EXHIBIT 10.7

STANDARD INDUSTRIAL/COMMERCIAL MULTI-TENANT LEASE - MODIFIED NET
                   AMERICAN INDUSTRIAL REAL ESTATE ASSOCIATION


1. Basic Provisions ['Basic Provisions")

1.1      Parties:  This Lease  ("Lease"),  dated for  reference  purposes  only,
         AUGUST 12, 1996,is made by and between EBJ PARTNERS, L.P., A CALIFORNIA
         LIMITED PARTNERSHIP  ("lessor") and ORYX TECHNOLOGY CORPORATION & SURGX
         CORPORATION ("Lessee:)  (collectively the '"Parties," or individually a
         "Party")

1.2(a)   Premises:   That  certain  portion  of  the  Building,   including  ail
Improvements  therein or to be provided by Lessor under the terms of this Lease,
commonly known by the street address of 1100 AUBURN STREET , located In the City
of FREMONT  County of ALAMEDA , State Or  CALIFORNIA  , with zip code 94538 , as
outlined  on Exhibit A attached  hereto  ['Premises',.  The  "Building"  is that
certain  building  containing the Premises and generally  described as (describe
briefly the nature of the Building):  Approximately  22,689 square feet of R & D
building and offices of a larger  38,628  square foot  building . In addition to
Lessee's rights to use and occupy the Premises as hereinafter specified,  Lessee
shall have non-exclusive rights to the Common Areas (as defined In Paragraph 2.7
below) as  hereinafter  specified,  but  shall not have any  rights to the roof,
exterior walls or utility  raceways of the Building or to any other buildings In
the Industrial  Center. The Premises,  the Building,  the Common Areas, the land
upon which they are located,  along with all other  buildings  and  Improvements
thereon,  are herein collectively  referred to as the "Industrial Center." (Also
see Paragraph 2.)
      1.2(b)  Parking:  Its prorata  share  unreserved  vehicle  parking  spaces
(Unreserved  Parking Spaces; and Not Applicable  reserved vehicle parking spaces
['Reserved Parking Spaces") (Also see Paragraph 2.6.)

1.3      Term: Five years and O months ("Original Term") commencing September 1,
         1996  (Commencement  Date),  and ending  August 30,  2001  ['Expiration
         Date") (Also see Paragraph 3.)

1.4      Early Possession:  See Addendum ("Early  Possession  Date").  (Also see
         Paragraphs  3.2 and 3.3.) 1.5 Base Rent:  $ 18,151.2D  per month ("Base
         Rent")  payable  on the  first  (  1st)day  of  each  month  commencing
         September 1, 1996 (Also see Paragraph 4.)

If this box is checked, this Lease provides for the Base Rent to be adjusted per
Addendum One, attached hereto.

1.6(a)   Base Rent Paid Upon  Execution:  $18,151.20 as Base Rent for the period
         September 1 through  September 30 1.6(b)  Lessee's Share of Common Area
         Operating  Expenses:  58. 70 percent  (58.70 %)  {'Lessee's  Share") as
         determined by prorate square footage of the Premises as compared to the
         total square  footage of the Building or other criteria as described in
         Addendum .

1.7      Securely Deposit: 18,151.20 ('Security Deposit) (Also see Paragraph 5.)

1.8      Permitted   use:   manufacturing   and  research  and   development  of
         electronics   equipment,   administrative,   and  other  related  uses.
         (Permitted Use-) (Also see Paragraph 6.)

1.9      Insuring Party.  Lessor Is the "Insuring Party.  (Also see Paragraph 8)

1.10(a)  Real Estate Brokers. The following real estate broker(s) (collectively,
         the "Brokers',  and brokerage  relationships  exist in this transaction
         and are consented to by the Parties (check applicable boxes):

BISHOP   HAWK represents Lessor exclusively  ('Lessor's  Broker);  GRUBB & ELLIS
         represents Lessee  exclusively  ['Lessee's Broker 1; or represents both
         Lessor and Lessee (Dual Agency-). (Also see Paragraph 15.)

1.       10(b)  Payment to  Brokers.  Upon the  execution  of this Lease by both
         Parties, Lessor shall pay to said Broker(s) jointly or in such separate
         shares as they may mutually designate In writing, a fee as set forth in
         a  separate  written   agreement  between  Lessor  and  said  Broker(s)
         for-brokerage  services  rendered by said Broker(s) In connection  with
         this transaction.  
1.11 Guarantor.  The Obligations of the Lessee under
         this Lease are to be guaranteed by NOT APPLICABLE  ("Guarantor")  (also
         see  Paragraph  37.) NO. 1 & 2 1.12  Addendum  and  Exhibits.  Attached
         hereto is an Addendum or  Addenda/consisting  of  Paragraphs 49 through
         66, and  Exhibits A through C, all of which  constitute  a part of this
         Lease.

2. Premises, Parking and Common Areas.

      2.1 Letting. Lessor hereby leases to Lessee, and Lessee hereby leases from
Lessor,  the Premises,  for the term, at the rental;  and upon all of the terms,
covenants and  conditions  set forth in this Lease.  Unless  otherwise  provided
herein,  any  statement of square  footage set forth in this Lease,  or that may
have been used In calculating rental and/or Common Area Operating  Expenses,  is
an approximation  which Lessor and Lessee agree is reasonable and the rental and
Lessee's Share (as defined In Paragraph  1.6(b)) based thereon is not subject to
revision whether or not the actual square footage is more or less.

      2.2 Condition.  Lessor shall deliver the Premises to Lessee clean and free
of debris on the  Commencement  Date and  warrants to Lessee  that the  existing
plumbing,  electrical systems, fire sprinkler system, lighting, all conditioning
and heating systems and loading doors, inane, in the Premises,  other than those
constructed by Lessee,  shall be in good operating condition on the Commencement
Date. If a non-compliance with said warranty exists as of the Commencement Date,
Lessor shall, except as otherwise provided In this Lease, promptly under receipt
of written  notice from Lessee  setting  forth with  specificity  the nature and
extent of such non-compliance,  rectify same at Lessor's expense. If Lessee does
not give Lessor written  notice of a  non-compliance  with this warranty  within
thirty (30) days after the Commencement Date,  correction of that non-compliance
shall be the obligation of Lessee at Lessee's sole cost and expense.

      2.3 Compliance  with  Covenants,  Restrictions  and Building Code.  Lessor
warrants that any  improvements  (other than those  constructed  by Lessee or at
Lessee's  direction)  on or In the  Premises  which  have  been  constructed  or
installed  by Lessor or with  Lessor's  consent or at Lessor's  direction  shall
comply with all applicable  covenants or  restrictions  of record and applicable
building codes,  regulations and ordinances in effect on the Commencement  Date.
Lessor  further  warrants to Lessee that  Lessor has no  knowledge  of any claim
having been made by any  governmental  agency that a violation or  violations of
applicable building codes,  regulations,  or ordinances exist with regard to the
Premises as of the  Commencement  Date. Said  warranties  shall not apply to any
Alterations or Utility Installations (defined In Paragraph 7.3(a)) made or to be
made by Lessee.  If the  Premises  do not comply  with said  warranties,  Lessor
shall,  except as otherwise  provided in this Lease,  promptly  after receipt of
written   notice  from  Lessee  given  within  six  (6)  months   following  the
Commencement  Date and setting forth with  specificity  the nature and extent of
such non-compliance, take such action, at Lessor's expense, as may be reasonable
or appropriate to rectify the non-compliance.  Lessor makes no warranty that the
Permitted Use in Paragraph 1.8 Is permitted  for the Premises  under  Applicable
Laws (as defined In Paragraph 2.4).

      2.4  Acceptance of Premises.  Lessee hereby  acknowledges  (a) that it has
been advised by the Broker(s) to satisfy itself with respect to the condition of
the Premises  including  but not limited to the  electrical  and fire  sprinkler
systems, security, environmental aspects, and compliance with the Americans with
Disabilities Act and applicable  zoning,  municipal,  county,  state and federal
laws,  ordinances and  regulations  and any covenants or  restrictions of record
(collectively, "Applicable Laws" ) and the present and future suitability of the
Premises for Lessee's intended use; (b) that Lessee has made such  investigation
as It  deems  necessary  with  reference  to such  matters,  if  satisfied  with
reference thereto,  and assume" all responsibility  therefore as the same relate
to Lessee's  occupancy of the Premises  and/or the terms of this Lease;  and (c)
that neither Lessor,  nor any of Lessor's  agents,  has made any oral or written
representations  or  warranties  with respect to said matters  other than as set
forth in this Lease.

      2.5 Lessee as Prior Owner/Occupant.  The warranties made by Lessor in this
Paragraph 2 shall be of no force or effect it Immediately  prior to the dale set
forth In Paragraph 1.1 Lessee was the owner or occupant of the Premises. In such
event,   Lessee  shall,   at  Lessee's  sole  cost  and  expense,   correct  any
non-compliance of the Premises with said warranties.

     2.6  Vehicle  Parking.  Lessee  shall  be  entitled  to use the  number  of
Unreserved  Parking Spaces and Reserved  Parking  Spaces  specified in Paragraph
1.2(b) on those  portions of the Common  Areas  designated  from time to time by
Lessor for parking.  Lessee shall not use more parking  spaces than said number.
Said  parking  spaces  shall be used for  parking  by  vehicles  no larger  than
full-size passenger automobiles or pick-up trucks, herein called "Permitted size
Vehicles."  Vehicles  other than  Permitted  Size  Vehicles  shall be parked and
loaded or  unloaded  as  directed  by Lessor  In the Rules and  Regulations  (as
defined in Paragraph 40) Issued by Lessor. (Also see Paragraph 2.9.)

             (a) Lessee shall not permit or allow any vehicles that belong to or
are controlled by Lessee or Lessee's employees,  suppliers, shippers, customers,
contractors  or Invitees to be loaded,  unloaded,  or parked in areas other than
those designated by Lessor for such activities.

             (b) If Lessee  permits or allows any of the  prohibited  activities
described  In this  Paragraph  2.6,  then Lessor  shall have the right,  without
notice,  In  addition to such other  rights and  remedies  that it may have,  to
remove or tow away the  vehicle  Involved  and charge the cost to Lessee,  which
cost shall be Immediately payable upon demand by Lessor.

(c) Lessor  shall at the  Commencement  Dale of this Lease,  provide the parking
facilities required by Applicable Law.

      2.7 Common Arena -  Definition.  The term "Common  Areas Is defined as all
areas and facilities  outside the Premises and within the exterior boundary line
of the Industrial  Center and Interior utility raceways within the Premises that
are  provided  and  designated  by the Lessor  from time to time for the general
non-exclusive  use of Lessor,  Lessee and other lessees of the Industrial Center
and their respective employees,  suppliers,  shippers, customers contractors and
Invitees,  Including  parking areas,  loading and unloading areas,  trash areas,
roadways, sidewalks, walkways, parkways, driveways and landscaped areas.

      2.8 Common Areas - Lessee's Right. Lessor hereby grants to Lessee, for the
benefit of Lessee and Its employees, suppliers, shippers contractors,  customers
and invitees,  during the term of this Lease, the non-exclusive right to use, In
common with others  entitled  to such use,  the Common  Areas as they exist from
time to time, subject to any rights,  powers, and privileges  reserved by Lessor
under the terms  hereof  or under  the  terms of any  rules and  regulations  or
restrictions  governing the use of the Industrial Center. Under no circumstances
shall the right herein  granted to use the Common Areas be deemed to Include the
right to store any property,  temporarily or  permanently,  In the Common Areas.
Any such storage shall be permitted only by the prior written  consent of Lessor
or Lessor's  designated agent,  which consent may be revoked at any time. In the
event that any  unauthorized  storage  shall  occur then  Lessor  shall have the
right, without notice, In addition to such other rights and remedies that It may
have, to remove the property and charge the cost to Lessee,  which cost shall be
immediately payable upon demand by Lessor.

      2.9 Common Arena - Rules and  Regulations.  Lessor or such other person(s)
as Lessor may appoint  shall have the  exclusive  control and  management of the
Common Areas and shall have the right, from time to time, to establish,  modify,
amend and enforce  reasonable  rules and  Regulations  with  respect  thereto In
accordance  with Paragraph 40. Lessee agrees to abide by and conform to all such
Rules  and  Regulations,  and  to  cause  its  employees,  suppliers,  shippers,
customers, contractors and Invitees to so abide and conform. Lessor shall not be
responsible for Lessee for the non-compliance with said rules and regulations by
other lessees of the Industrial Center.

2.10     Common Area - Changes.  Lessor shall have the right,  In Lessor's  sole
         discretion, from time to time: (a) To make changes to the Common Areas,
         including, without limitation, changes in the location, size, shape and
         number of driveways,  enhances,  parking spaces, parking areas, loading
         and unloading areas, ingress, egress, direction of traffic,  landscaped
         areas, walkways and utility raceways;

(b)      To close  temporarily any of the Common Areas for maintenance  purposes
         so long as reasonable access to the Premises remains available;

(c)      To designate other land outside the boundaries of the Industrial Center
         to be a part of the Common Areas

(d)      To add additional buildings and Improvements to the Common Areas;

(e)      To  use  the  Common   Areas   while   engaged  In  making   additional
         Improvements,  repairs or alterations to the Industrial  Center, or any
         portion thereof; and

(f)      To do and perform such other acts and make such other changes in, to or
         with respect to the Common Areas and  Industrial  Center as Lessor may,
         In the exercise of sound business Judgment, deem to be appropriate.

3. Term

      3.1 The Commencement Data, Expiration Data and Original Term of this Lease
are as specified in Paragraph 1.3.

      3.2  Early  Possession.  If an  Early  Possession  Data  Is  specified  In
Paragraph 1.4 and if Lessee totally or partially occupies the Premises alter the
Early Possession Date but prior to the Commencement  Date, the obligation to pay
Base Rent  shall be abated for the  period of such  early  occupancy.  All other
terms of this lease,  however,  (including but not limited to the obligations to
pay Lessee's Share of Common Area Operating  Expenses and to carry the Insurance
required by Paragraph 8) shall be in effect  during such period.  Any such early
possession  shall not affect nor advance  the  Expiration  Date of the  Original
Term.

      3.3  Delay  In  Possession.  If  for  any  reason  Lessor  cannot  deliver
possession  of the Premises to lessee by the Early  Possession  Date,  if one Is
specified In Paragraph 1.4, or if no Early Possession Date is specified,  by the
Commencement Date, Lessor shall not be subject to any liability  therefore,  nor
shall such failure  affect the  validity of this Lease,  or the  obligations  of
Lessee hereunder, or extend the term hereof, but In such case, Lessee shall not,
except as  otherwise  provided  herein,  be obligated to pay rent or perform any
other  obligation of Lessee under the terms of this Lease until Lessor  delivers
possession  of the  Premises to Lessee.  If  possession  of the  Premises is not
delivered to Lessee  within sixty (60) days after the  Commencement  Data Lessee
may,  at Its option,  by notice In writing to Lessor  within ten (10) days after
the end of said sixty (60) day period,  cancel  this  Lease,  In which event the
parties shall be discharged from all obligations  hereunder;  provided  further,
however,  that if such written notice of Lessee is not received by Lessor within
said ten (10) day period,  Lessee's right to cancel this Lease  hereunder  shall
terminate  and be of no  further  force or  effect.  Except as may be  otherwise
provided,  and  regardless  of when the Original  Term  actually  commences,  If
possession is not tendered to Lessee when required by this Lease and Lessee does
not terminate this Lessee as aforesaid, the period free of the obligation to pay
Base Rent, if any, that Lessee would  otherwise  have enjoyed shall run from the
date of delivery of  possession  and  continue  for a period equal to the period
during which the Lessee would have otherwise enjoyed under the terms hereof, but
minus any days of delay caused by the acts, changes or omissions of Lessee.

4. Rent.

      4.1 Base Rent.  Lessee  shall pay Base rent and other rent or charges,  as
the same may be  adjusted  from time to time,  to Lessor in lawful  money of the
United States, without offset or deduction,  on or before the day on which it Is
due under the terms of this Lease.  Base Rent and all other rent and charges for
any period during the term hereof which Is for less than one full month shall be
prorated based upon the actual number of days of the month involved.

Payment of Base rent and other  charges  shall be made to Lessor at its  address
stated herein or to such other persons or at such other  addresses as Lessor may
from time to time designate in writing to Lessee.

4.2 Common Area Operating  Expenses.  Lessee shall pay to Lessor during the term
hereof, In addition to the Lease Rent,  Lessee's Share as specified In Paragraph
1.6(b)) of all Common Area Operating Expenses,  as hereinafter  defined,  during
each calendar year of the term of this Lease,  In accordance  with the following
provisions:
         (a) "Common Area Operating Expenses" are defined,  for purposes of this
Lease,  as all costs Incurred by Lessor  relating to the ownership and operation
of the Industrial Center, Including, but not limited to, the following:
                  (i) The operation,  repair and  maintenance,  in neat,  clean,
good order and condition, of the following:

                      (aa)  The Common Areas, Including parking areas, loading 
and unloading areas, trash areas, roadways,
sidewalks,  walkways, parkways, driveways,  landscaped areas, striping, bumpers,
Irrigation systems, Common Area lighting facilities, fences and gates, elevators
and roof.

                      (bb) Exterior signs and any tenant directories.

                      (cc) Fire detection and sprinkler systems.

                   (ii) The cost of water,  gas,  electricity  and  telephone to
service the Common Areas.
         
            (iii) Trash disposal, property management and security services and
 the costs of any environmental    inspections.

                  (iv) Reserves set aside for maintenance and repair of Common 
Areas.
                   (v) Real Property  Taxes (as defined in Paragraph  10.2) to
be paid by Lessor for the Building and the Common Areas
under Paragraph 10 hereof.
                   (vi)  The cost of the  premiums  for the  Insurance  policies
                   maintained  by Lessor  under  Paragraph  8 hereof.  (vii) Any
                   deductible portion of an Insured IOSB concerning the Building
                   or the Common Areas.

                   (viii) Any other  services  to be provided by Lessor that are
stated elsewhere In this Lease to be a Common Area Operating Expanse.
              (b) Any Common Area  Operating  Expenses and Real  Property  Taxes
that are  specifically  attributable to the Building or to any other building in
the industrial Center or to the operation, repair and maintenance thereof, shall
be allocated  entirely to the Building or to such other building.  However,  any
Common Area Operating Expenses and Real Property Taxes that are not specifically
attributable to the Building or to any other building or to the operation repair
and maintenance thereof, shall be equitably allocated by Lessor to all buildings
In the Industrial Center.
             (c) The Inclusion of the Improvements,  facilities and services set
forth In  Subparagraph  4.2(a) shall not be deemed to Impose an obligation  upon
Lessor to either  have said  Improvements  or  facilities  or to  provide  those
services  unless the  Industrial  Center  already has the same,  Lessor  already
Provides the services,  or Lessor has agreed  elsewhere in this Lease to provide
the same or some of them.
            (d)  Lessee's  Share of  Common  Area  Operating  Expenses  shall be
payable by Lessee within ten (10) days after a reasonably  detailed statement of
actual expenses is presented to Lessee by Lessor.  At Lessor's option,  however,
an amount may be  estimated  by Lessor  from time to time of  Lessee's  Share of
annual Common Area Operating  Expenses and the same shall be payable  monthly or
quarterly,  as Lessor shall designate,  during each 12-month period of The Lease
term, on the same day as the Base rent Is due hereunder. Lessor shall deliver to
Lessee  within  sixty (60) days after the  expiration  of each  calendar  year a
reasonably  detailed  statement showing Lessee's Share of the actual Common Area
Operating  Expenses  Incurred  during the preceding  year. If lessee's  payments
under this Paragraph  4.2(d) during said preceding year exceed Lessee's Share as
Indicated  on said  statement,  Lessor  shall be  credited  the  amount  of such
overpayment  against  Lessee's  Share of Common  Area  Operating  Expenses  next
becoming  due. If Lessee's  payments  under This  Paragraph  4.2(d)  during said
preceding  year were less than  Lessee's  Share as indicated on said  statement,
Lessee  shall pay to Lessor  the amount of the  deficiency  within tan ,10) days
after delivery by Lessor to Lessee of said statement.

5. Security  Deposit.  Lessee shall deposit with Lessor upon Lessee's  execution
hereof the Security  Deposit set forth in Paragraph 1.7 as security for Lessee's
faithful  performance of Lessee's  obligations under this Lease. If Lessee fails
to pay Base Rent or other rent or charges due hereunder,  or otherwise  Defaults
under this Lease (as defined in Paragraph 13.1), Lessor may use, apply or retain
all or any  portion of said  Security  Deposit for the payment of any amount due
Lessor or to reimburse or compensate  Lessor for any liability,  cost,  expense,
loss or damage  (including  attorney's fees) which Lessor may suffer or incur by
reason  thereof.  If Lessor uses or applies all or any portion of said  Security
Deposit,  Lessee  shall  within ten (10) days alter  written  request  therefore
deposit  monies with Lessor  sufficient to restore said Security  Deposit to the
full amount required by this Lease.  Any time the Base Rent increases during the
term of this Lease,  Lessee  shall,  upon written  request from Lessor,  deposit
additional monies with Lessor as an addition to the Security Deposit so that the
total amount of the Security Deposit shall at all times bear the same proportion
to the then  current  Base Rent as the  initial  Security  Deposit  bears to the
initial  Base Rent set forth in Paragraph  1.5.  Lessor shall not be required to
keep all or any part of the Security Deposit separate from Its general accounts.
Lessor shall,  at the  expiration or earlier  termination of the term hereof and
after  Lessees  has  vacated  the  Premises,  return to Lessee  (or, at Lessor's
option, to the last assignee, If any, of Lessee's Interest herein), that portlon
of the  Security  Deposit  not  used or  applied  by  Lessor.  Unless  otherwise
expressly agreed In writing by Lessor,  no part of the Security Deposit shall be
considered to be held in trust, to bear interest of other increment for Its use,
or to be prepayment for any monies to be paid by Lessee under this Lease.

6.  Use

6.1 Permitted Use

             (a) Lessee shall use and occupy the Premises only for the Permitted
Use set  forth In  Paragraph  1.8,  or any other  legal use which is  reasonably
comparable thereto, and for no other purpose. Lessee shall not use or permit the
use of the Premises in a manner that is unlawful,  creates  waste or a nuisance,
or that disturbs owners and/or occupants of, or causes damage to the Premises or
neighboring premises or properties.

             (b)) Lessor hereby agrees to not unreasonably withhold or delay Its
consent to any written request by Lessee,  Lessee's  assignees or subtenants and
by prospective assignees and subtenants of Lessee, Its assignees and subtenants,
for a  modification  of said  Permitted Use, so long as the same will not Impair
the structural  integrity of the Improvements on the Premises or In the Building
or the mechanical or electrical systems therein,  does not conflict with uses by
other  lessees,  is not  significantly  more  burdensome  to the Premises or the
Building and the Improvements  thereon, and is otherwise permissible pursuant to
this Paragraph 6. If Lessor elects to withhold such content, Lessor shall within
five (5) business days after such request give a written  notification  of same,
which notice shelf Include an explanation of Lessor's  reasonable  objections to
the change In use.

6.2 Hazardous Substances.

             (a) Reportable Uses Require Consent. The term "Hazardous Substance.
as used In this Lease shall mean any product,  substance,  chemical, malarial or
waste whose  presence,  nature,  quantify  and/or  intensity of existence,  use,
manufacture, disposal, transportation, spill, release or effect either by Itself
or In combination with other materials expected to be on the Premises, is either
p)  potentially   Injurious  to  the  public  health,  safety  or  welfare,  the
environment,  or the Premises;  (ii) regulated or monitored by any  governmental
authority;   or  (iii)  a  basis  for  potential  liability  of  Lessor  to  any
governmental  agency or third party under any  applicable  statute or common law
theory.  hazardous Substance shall include, but not be limited to, hydrocarbons,
petroleum,  gasoline,  crude oil or any products or by-products thereof.  Lessee
shall not engage In any activity In or about the Premises  which  constitutes  a
Reportable  Use (as  hereinafter  defined) of Hazardous  Substances  without the
express  prior written  consent of Lessor and  compliance in a timely manner (at
Lessee's sole cost and expense) with all Applicable  Requirements (as defined In
Paragraph 6.3).  reportable  use" shall mean (i) the  Installation or use of any
above or below ground storage tank,  pi) the  generation,  possession,  storage,
use, transportation, or disposal of a Hazardous Substance that requires a permit
from, or with respect to which a report,  notice,  registration or business plan
is required to be filed with, any governmental authority,  and (ii) the presence
In, on or about the Premises o1 a Hazardous  Substance with respect to which any
Applicable Laws require that a notice be given to persons  entering or occupying
the Premises or neighboring propels.  Notwithstanding the foregoing, Lessee may,
without Lessor's prior consent, but upon notice to Lessor and In compliance with
all Applicable Requirements, use any ordinary and customary materials reasonably
required to be used by Lessee In the normal course of the permitted Use, so long
as such  use is not a  reportable  Use and  does  not  expose  the  Premises  or
neigboring  properties  to any  meaningful  risk of  contamination  or damage or
expose Lessor to any liability  therefor.  In addition,  Lessor may (but without
any  obligation  to do so) condition  its consent to any  Reportable  use of any
Hazardous  Substance  by Lessee upon  Lessee's  giving  Lessor  such  additional
assurances as Lessor, in its reasonable  discretion,  deems necessary to protect
Itself,   the  public,   the  Premises  and  the  environment   against  damage,
contamination or injury and/or liability therefor,  including but not limited to
the installation (and, at Lessor's option, removal on or before Lease expiration
or earlier termination) of reasonably necessary protective  modifications to the
Premises  (such as concrete  encasements)  and/or the  deposit of an  additional
Security Deposit under Paragraph 5 hereof.

             (b) Duty to Inform Lessor, If Lessee knows, or has reasonable cause
to believe,  that a Hazardous  Substance has come to be located In, on, under or
about the Premises or the  Building,  other than as  previously  consented to by
Lessor,  Lessee shall  Immediately give Lessor written notice thereof,  together
with a copy of any statement, report, notice, registration, application, permit,
business plan, license, claim, action, or proceeding given to, or received from,
any  governmental  authority or private party  concerning  the presence,  spill,
release,  discharge of, or exposure to, such Hazardous  Substance  including but
not  limited 10 all such  documents  as may be Involved  In any  Reportable  Use
Involving the Premises. Lessee shall not cause or permit any Hazardous Substance
to be  spilled  or  released  in, on,  under or about the  Premises  (Including,
without limitation, through the plumbing or sanitary sewer system).

             (c) Indemnification.  Lessee shall Indemnify,  protect,  defend and
hold Lessor, its agents,  employees,  lenders and ground lessor, if any, and the
Premises, harmless from and against any and all damages, liabilities, judgments,
costs, claims, liens,  expenses,  penalties,  loss of permits and attorneys' and
consultant's fees along out of or involving any Hazardous Substance brought onto
the  Premises by or for Lessee or by anyone  under  Lessee's  control.  Lessee's
obligations  under this Paragraph  6.2(c) shall Include,  but not be limited to,
the  effects  of  any  contamination  or  injury  to  person,  property  or  the
environment  created  or  suffered  by  Lessee,  and the  cost of  investigation
including consultants' and attorneys' fees and testing),  removal,  remediation,
restoration and/or abatement thereof, or of any contamination  therein involved,
and shall  survive the  expiration  or earlier  termination  of this  Lease.  No
termination, cancellation or release agreement entered Into by Lessor and Lessee
shall  release  Lessee  from its  obligations  under this Lease with  respect to
Hazardous Substances,  unless specifically so agreed by Lessor In writing at the
time of such agreement.

      6.3 Lessee's Compliance with Requirements.  Lessee shall, a1 Lessee's sole
cost and expense,  fully,  diligently  and In a timely  manner,  comply with all
"Applicable  Requirements;  which  term is used In this  Lease to mean all laws,
rules,   regulations,   ordinances,   directives,   covenants,   easements   and
restrictions  of  record,  permits,  the  requirements  of any  applicable  fire
Insurance  underwriter or rating  bureau,  and the  recommendations  of Lessor's
engineers and/or consultants,  relating In any manner to the Premises (including
but  not  limited  to  matters  pertaining  to  (i)  industrial   hygiene,   (i)
environmental conditions on, In, under or about the Premises, Including soil and
groundwater conditions, and (iii) the use, generation, manufacture,  production,
installation maintenance, removal, transportation, storage, spill, or release of
any Hazardous Substance), now In effect or which may hereafter come Into effect.
Lessee shall,  within five (5) days after receipt of Lessor's  written  request,
provide Lessor with copies of all documents and  information,  including but not
limited  to  permits,  registrations,   manifests,   applications,  reports  and
certificates,  evidencing Lessee's  compliance with any Applicable  Requirements
specified  by Lessor,  and shall  Immediately  upon  receipt,  notify  Lessor In
writing  (with copies of any  documents  involved) of any  threatened  or actual
claim, notice, citation warning,  complaint or report pertaining to or Involving
failure by Lessee or the Premises to comply with any Applicable Requirements.

      6.4 Inspection;; Compliance with Law:. Lessor, Lessor's agents, employees,
contractors  and designated  representatives,  and the holders of any mortgages,
deeds of trust or ground leases on the Premises ['Lenders', shall have the right
to enter the Premises at any time In the case of an emergency,  and otherwise at
reasonable  times,  for the purpose of Inspecting  the condition of the Premises
and for  verifying  compliance  by  Lessee  with this  Lease and all  Applicable
Requirements  (as defined in  Paragraph  6.3),  and Lessor  shall be entitled to
employ experts and/or consultants In connection  therewith to advise Lessor with
respect  to  Lessee's   activities,   Including  but  not  limited  to  Lessee's
Installation,  operation,  use,  monitoring,  maintenance,  or  removal  of  any
Hazardous Substance on or from the Premises.  The costs and expenses of any such
Inspections  shall be paid by the party  requesting  same,  unless a Default  or
Breach of this Lease by Lessee or a violation of  Applicable  Requirements  or a
contamination,  caused or materially contributed to by Lessee, is found to exist
or  to  be  imminent,  or  unless  the  Inspection  requested  or  ordered  by a
governmental  authority as the result of any such existing or Imminent violation
or  contamination.  In such case,  Lessee shall upon request reimburse Lessor or
Lessor's Lender, as the case maybe, for the costs and expenses/such inspection.

7, Maintenance, Repairs, Utility Installations, Trade Fixtures and Alterations.

7.1 Lessee's Obligations,

             (a) Subject to the  provisions of Paragraphs 2.2  (Condition),  2.3
(Compliance  with  Covenants,  Restrictions  and Building  Code),  7.2 (Lessor's
Obligations), 9 (Damage or Destruction), and 14 (Condemnation), Lessee shall, at
Lessee's sole cost and expense and at all times keep the Premises end every part
thereof In good order,  condition and repair (whether or not such portion of the
Premises requiring repair, or the means of repairing the same, are reasonably or
readily  accessible  to Lessee,  and  whether  or not the need for such  repairs
occurs as a result of Lessee's  use,  any prior use,  the elements or the age of
such portion of the Premises), Including, without limiting the generality of the
foregoing,  all equipment or facilities  specifically serving the Premises, such
as  plumbing,  heating,  air  conditioning,  ventilating,  electrical,  lighting
facilities, boilers, fired or unfired pressure vessels, fire hose connections if
within the Premises,  fixtures,  Interior walls,  Interior  surfaces of exterior
walls,  ceilings,  floors,  windows,  doors,  plate glass,  and  skylights,  but
excluding any items which are the responsibility of Lessor pursuant to Paragraph
7.2 below. Lessee, in keeping the Premises in good order,  condition and repair,
shall  exercise and perform good  maintenance  practices.  Lessee's  obligations
shall Include restorations,  replacements or renewals when necessary to keep the
Premises and all Improvements thereon or a part thereof In good order, condition
and state of repair.

             (b) Lessee shall,  at Lessee's  sole cost and expense,  procure and
maintain a contract,  with copies to Lessor, in customary form and substance for
and  with  a  contractor   specializing   and  experienced  In  the  inspection,
maintenance and service of the heating,  air conditioning and ventilation system
for the Premises.  However,  Lessor reserve the right, upon notice to Lessee, to
procure  and  maintain  the  contract  for the  heating,  air  conditioning  and
ventilating  systems,  and If Lessor so elects,  Lessee shall reimburse  Lessor,
upon demand, for the cost thereof.

             (c) If Lessee  fails to  perform  Lessee's  obligations  under this
Paragraph  7.1,  Lessor may enter upon the  Premises  under ten (10) days' prior
written notice to Lessee  (except In the case of an emergency,  In which case no
notice shall be required),  perform such obligations on Lessee's behalf, and put
the Premises In good order  condition and repair,  In accordance  with Paragraph
13.2 below.

      7.2 Lessor's  Obligations.  Sublet to the  provisions  of  Paragraphs  2.2
(Condition),  2.3 (Compliance  with Covenants,  Restrictions and Building Coda),
4.2 (Common Area Operating  expenses),  6. (Use) 7.1 (Lessee's  Obligations),  9
(Damage or Destruction) and 14 (Condemnation),  Lessor, subject to reimbursement
pursuant to Paragraph  4.2,  shall keep In good order,  condition and repair the
foundations,  exterior walls,  structural  condition of Interior  bearing walls,
exterior  roof,  fire  sprinkler  and/or  standpipe  and hose (11 located In the
Common Areas) or other automatic fire extinguishing system Including fire alarm

Initials:

  ore,.  -~



<PAGE>


and/or smoke  detection  systems and  equipment,  fire  hydrants,  parking lots,
walkways,  parkways,  driveways,  landscaping,  fences, signs and utility system
serving'  the  Common  Areas and all parts  thereof,  as well as  providing  the
services  for  which  there is a  Common  Area  Operating  Expense  pursuant  to
Paragraph  4.2.  Lessor shall not be obligated to paint the exterior or Interior
surfaces of exterior walls nor shall Lessor be obligated to maintain,  repair or
replace windows,  doors or plate glass of the Premises.  Lessee expressly waives
the benefit of any  statute now or  hereafter  In effect  which would  otherwise
afford Lessee the right to make repairs at Lessor's expense or to terminate this
Lease  because of Lessor's  failure to keep the building,  Industrial  Center or
Common Areas In good order, conditlon and repair

7.3 Utility Installations, Trade Fixtures, Alterations.

             (a) Definitions; Consent required. The term "Utility Installations"
is used In this  Lease to  refer  to all air  lines,  power  panels,  electrical
distribution,   security,  fire  protection  systems,   communications  systems,
lighting  fixtures,   heating,   ventilating  and  alr  conditioning  equipment,
plumbing,  and fencing In, on or about the Premises.  The term "Trade  Fixtures"
shall mean Lessee's  machinery and equipment  which can be removed without doing
material  damage  to  the  Premises.  The  term  "Alterations"  shall  mean  any
modification  of the  improvements  on the Premises which are provided by Lessor
under  the  terms of this  Lease,  other  than  Utility  Installations  or Trade
Fixtures. "Lessee-Owned Alterations and/or utility installations. are defined as
Alterations  and/or Utility  Installations made by Lessee that are not yet owned
by Lessor  pursuant to Paragraph  7.4(a).  Lessee shall not make nor cause to be
made any  Alterations  or  Utility  Installations  in,  on,  under or about  the
Premises  without  Lessor's prior written  consent.  Lessee may,  however,  make
non-structural  Utility Installations to the Interior of the Premises (excluding
the roof) without  Lessor's  consent but upon notice to Lessor,  so long as they
are not  visible  from the outside of the  Premises  do not involve  puncturing,
relocating  or  removing  the  roof  or  any  existing  walls,  or  changing  or
Interfering with the fire sprinkler or fire detection systems and the cumulative
cost  thereof  during  the  term of this  Lease  as  extended  does  not  exceed
$2,500.00.

             (b) Consent.  Any Alterations or Utility  Installations that Lessee
shall  desire to make and which  require  the  consent  of the  Lessor  shall be
presented to Lessor In written form with detailed  plans.  All consents given by
Lessor, whether by virtue of Paragraph 7.3(a) or by subsequent specific consent,
shall be deemed  conditioned upon: p) Lessee's  acquiring all applicable permits
required  by  governmental  authorities;  pi) the  furnishing  of copies of such
permits together with a copy of the plans and  specifications for the Alteration
or Utility Installation to Lessor prior to commencement of the work thereon; and
(ii) the  compliance  by Lessee with all  conditions of said permits In R prompt
and  expeditious  manner.  Any  Alterations or Utility  Installations  by Lessee
during the term of this Lease  shall be done In a good and  workmanlike  manner,
with good and sufficient  materials,  and be the compliance  with all Applicable
requirements.  Lessee shall promptly upon completion thereof furnish Lessor with
as-built plans and specifications therefor.  Lessor may, (but without obligation
to do  so)  condition  Its  consent  to  any  requested  Alteration  or  Utility
Installation that costs $2,500.00 or more upon Lessee's  providing Lessor with a
lien and  completion  bond in an  amount  equal to one and  one-half  times  the
estimated cost of such Alteration or Utility Installation.

             (c) Lien Protection. Lessee shall pay when due all claims for labor
or material  furnished or alleged to have been  furnished to or for Lessee at or
for use on the Premises, which claims are or may be secured by any mechanic's or
materialmen's  lien against the Premises or any interest  therein.  Lessee shall
give Lessor not lass than tan (10) days' notice prior to the commencement of any
work in,  on, or about the  Premises,  and  Lessor  shall have the right to post
notices of  non-responsibility  In or on the  Premises  as  provided  by law. If
Lessee  shall,  In good faith,  contest the validity of any such lien,  claim or
demand,  then Lessee  shall,  at Its sole  expense,  defend and protect  itself,
Lessor and the  Premises  against  the same and shall pay and  satisfy  any such
adverse  judgement that may be rendered  thereon before the enforcement  thereof
against  the Lessor or the  Premises.  If Lessor  shall  require,  Lessee  shall
furnish to Lessor a surety bond satisfactory to Lessor In an amount equal to one
and  one-half  times  the  amount  of  such  contested  lien  claim  or  demand,
Indemnifying  Lessor against  liability for the same, as required by law for the
holding of the Premises free from the effect of such lien or claim. In addition,
Lessor  may  require  Lessee  to pay  Lessor's  attorneys'  fees  and  costs  In
participating  In such action If Lessor shall decide It is to Its best  interest
to do so.

7.4 Ownership, removal, Surrender, and Restoration.

             (a)  Ownership.  Sublet to Lessor's  right to require their removal
and to cause Lessee to become the owner thereof as hereinafter  provided In this
Paragraph 7.4, all Alterations and Utility Installations made to the Premises by
Lessee  shall be the property of and owned by Lessee,  but  considered a part of
the  Premises.  Lessor may,  at any time and at Its option,  elect In writing to
Lessee  to be  the  owner  of  all or any  specified  part  of the  Lessee-Owned
Alterations  and  Utility   Installations.   Unless  otherwise   Instructed  per
Subparagraph   7.4(b)  hereof,   all   Lessee-Owned   Alterations   and  Utility
Installations  shall,  at the  expiration or earlier  termination of this Lease,
become the property of Lessor and remain upon the  Premises  and be  surrendered
with the Premises by Lessee.

              (b)  removal.  Unless  otherwise  agreed In  writing,  Lessor  may
require that any or all  Lessee-Owned  Alterations or Utility  Installations  be
removed by the expiration or earlier termination of this Lease,  notwithstanding
that their Installation may have been consented to by Lessor. Lessor may require
the  removal  at any  time of all or any  part  of any  Alterations  or  Utility
Installations made without the required consent of Lessor.

             (c)  Surrender/Restoration.  Lessee shall surrender the Premises by
the end of the last day of the Lease term or any earlier terminatlon date, clean
and free of debris and In good operating  order,  condition and state of repair,
ordinary  wear and tear  excepted.  Ordinary wear and tear shall not Include any
damage or  deterioration  that would  have been  prevented  by good  maintenance
practice or by Lessee performing all of Its obligations under this Lease. Except
as otherwise agreed or specified  herein,  the Premises,  as surrendered,  shall
Include the  Alterations  and Utility  Installations.  The  obligation of Lessee
shall  Include  the  repair  of  any  damage  occasioned  by  the  installation,
maintenance or removal of Lessee's Trade f fixtures, furnishings, equipment, and
Lessee-Owned  Alterations and Utility  Installations,  as well as the removal of
any storage tank Installed by or for Lessee,  and the removal,  replacement,  or
remediation of any soil, material or ground water contaminated by Lessee, all as
may then be required by Applicable  requirements and/or good practice.  Lessee's
Trade  Fixtures  shall  remain  the  property  of Lessee and shall be removed by
Lessee  subject to Its  obligation  to repair and restore the  Premises per this
Lease.

8. Insurance; Indemnity.

      8.1  Payment  of  Premiums.  the cost of the  premiums  for the  Insurance
policies  maintained  by Lessor  under this  Paragraph  8 shall be a Common Area
Operating Expense pursuant to Paragraph 4.2 hereof.  Premiums for policy periods
commencing  prior to,  or  extending  beyond,  the term of this  Lease  shall be
prorated to coincide  with the  corresponding  Commencement  Date or  Expiration
Date.

8.2 Liability Insurance.

             (a) Carried by Lessee. Lessee shall obtain and keep In force during
the term of this  Lease a  Commercial  General  Liability  policy  of  Insurance
protecting  Lessee,  Lessor and any Lender(s)  whose names have been provided to
Lessee In writing (as  additional  Insured)  agalnst  clalms for bodlly  injury,
personal injury and property damage based upon,  Involving or arising out of the
ownership,  use,  occupancy  or  maintenance  of  the  Premises  and  all  areas
appurtenant  thereto.  Such Insurance shall be on an occurrence  basis providing
single limit coverage In an amount not less than  $1,000,000 per occurrence with
an 'Additional  Insured-Managers or Lessors of premises  endorsement and contain
the Amendment of the Pollution Exclusion  endorsement for damage caused by heat,
smoke  or  fumes  from  a  hostile  fire.  The  policy  shall  not  contain  any
Intra-lnsured exclusions as between insured persons or organizations,  but shall
Include coverage for liability assumed under this Lease as an "insured contract"
for the  performance of Lessee's  indemnity  obligations  under this Lease.  The
limits of said  insurance  required by this Lease ores  carried by Lessee  shall
not,  however,  limited  liability of Lessee nor relieve Lessesof any obilgatlon
hereunder.  All  Insurance  to be carrled by lessee  shall be prlmary to and not
contrlbutory with any similar insurance carried by Lessor, whose insurance shall
be considered excess Insurance only.

             (b)  Carried  by  Lessor.  Lessor  shall  also  maintain  liability
Insurance  described In Paragraph  8.2(a) above,  In addition to and not In lieu
of, the Insurance required to be maintained by Lessee. Lessee shall not be named
as an additional Insured therein.

8.3 Property Insurance-Buliding, Improvements and Rental Value.

             (a) Building and Improvement. Lessor shall obtain and keep in force
during the term of this Lease a policy or policies  In the name of Lessor,  with
JOBS payable to Lessor and to any Lender(s),  Insuring against loss or damage to
the Premises.  Such Insurance  shall be for full  replacement  cost, as the same
shall exist from time to time, or the amount  required by any Lender(s),  but In
no event more than the  commercially  reasonable and available  Insurable  value
thereof If, by reason of the unique nature or age of the Improvements  Involved,
such later amount Is less than full replacement cost.  Lessee-Owned  Alterations
and Utility  Installations,  Trade Fixtures and Lessee's personal property shall
be Insured by Lessee  pursuant to Paragraph 8.4. H the coverage Is available and
commercially  appropriate,  Lessor's policy or policies shall Insure against all
risks of direct  physical  loss or damage  (except  the  perils of flood  and/or
earthquake unless required by a Lender),  Including  coverage for any additional
costs  resulting from debris removal and reasonable  amounts of coverage for the
enforcement of any ordinance or law regulating the reconstruction or replacement
of any undamaged  sections of the Building  required to be demolished or removed
by reason of the enforcement of any building, zoning, safety or land use laws as
the result of a covered loss,  but not  including  plate glass  Insurance.  Said
policy or policies shall also contain an agreed  valuation  provision in lieu of
any co-insurance clause, waiver of subrogation, and inflation ',guard protection
causing an Increase In the annual property Insurance coverage amount by a factor
of not less than the adjusted U.S.  Department of Labor Consumer Price Index for
All Urban Consumers for the city nearest to where the Premises are located.

             (b) Rental Value.  Lessor shall also obtain and keepin force during
the term of this Lease a pollcy or  policies  In the name of  Lessor,  with loss
payable to Lessor and any  Lender(s),  insuring  the loss of the full rental and
other  charges  payable by all  lessees of the  building  to Lessor for one year
including all f teal Property Taxes,  Insurance costs, all Common Area Operating
Expenses and any scheduled rental Increases). Said Insurance may provide that In
the event the Lease 18 terminated  by reason of an Insured  loss,  the period of
indemnity for such coverage shall be extended  beyond the date of the completion
of repairs or replaceme to the Premises,  to provide for one full year's loss of
rental  revenues from the date of any such loss. Said Insurance shall contain an
agreed valuation provision In lieu of any co-insurance clause, and the amount of
coverage shall be adjusted annually to reflect the projected rental income, Real
Property Taxes,  insurance premium costs and other expenses,  If any,  otherwise
payable,  for the next 1 2-month  period.  Common Area Operating  Expenses shall
Include any deductible amount in the event of such loss.

             (c)  Adjacent  Premises.  Lessee  shall pay for any Increase In the
premiums for the property  Insurance of the Building and for the Common Areas or
other buildings In the Industrial  Center If said Increase Is caused by Lessee's
acts, omissions, use or occupancy of the Premises.

             (d) Lessee's  Improvements.  Since  Lessor is the  insuring  Party,
Lessor  shall not be required  to insure  Lessee-Owned  Alterations  and Utility
installations  unless the Item in  question  has become the  property  of Lessor
under the terms of this Lease.

      8.4 Lessee's Property Insurance.  subject to the requirements of Paragraph
8.5, Lessee at Its cost shall either by separate policy or, at Lessor's  option,
by endorsement to a policy already carried,  maintain  Insurance coverage on all
of Lessee's personal property,  Trade Fixtures and Lessee-Owned  Alterations and
Utility  Installations In, on, or about the Premises similar In coverage to that
carried by Lessor as the Insuring Party under Paragraph 8.3(a).

Such Insurance shall be full  replacement cost coverage with a deductible not to
exceed $1,000 per occurrence. The proceeds from any such Insurance shall be used
by Lessee for the replacement of personal  property and the restoration of Trade
Fixtures and Lessee-Owned  Alterations and Utility  Installations.  Upon request
from  Lessor,  Lessee  shall  provide  Lessor with  written  evidence  that such
Insurance Is In force.

8.5      Insurance Policies.  Insurance required hereunder shall be In companies
         duly licensed to transact  business In the state where the Premises are
         located, and maintaining during the policy term a General Policyholders
         Rating.  of at least B +, V, or such other rating as may be required by
         a Lender, as set

Initial:



<PAGE>


forth in the most current Issue of "Best's Insurance Guide.. Lessee shall not do
or permit to be d `~,e anything which shall  Invalidate  the insurance  policies
referred to In this  Paragraph  8. Lessee shall cause to be delivered to Lessor,
within  seven p) days  alter the  earlier  of the Early  Possession  Date or the
Commencement Date, certified copies of, or certificates evidencing the existence
and amounts of, the insurance  required under Paragraph  8.2(a) and e.4. No such
policy shall be cancelable or subject to  modification  except after thirty (30)
days' prior  written  notice to Lessor.  Lessee  shall at least thirty (30) days
prior to the  expiration  of such  policies,  furnish  Lessor  with  evidence of
renewals or insurance binders  evidencing  renewal thereof,  or Lessor may order
such  Insurance  and charge the cost  thereof to Lessee,  which  amount shall be
payable by Lessee to Lessor upon demand.

      8.6 Waiver of Subrogatlon. Without affecting any other rights or remedies,
Lessee and Lessor  each hereby  release  and relieve the other,  and waive their
entire  right to recover  damages  (whether In contract or In tort)  against the
other,  for loss or damage to their  property  arising out of or Incident to the
perils  required to be Insured  against  under  Paragraph  8. The effect of such
releases and waivers of the right to recover damages shall not be limited by the
amount of  insurance  carried  or  required,  or by any  deductibles  applicable
thereto.  Lessor and Lessee agree to have their respective  Insurance  companies
issuing  property  damage  insurance  waive any right to  subrogation  that such
companies  may have against  Lessor  Lessee,  as the case maybe,  so long as the
insurance is not invalidated thereby.

      8.7  Indemnity.  Except for Lessor's  negligence  and/or breach of express
warranties,  Lessee  shall  Indemnify,  protect,  de/end and hold  harmless  the
Premises,  Lessor and Its agents, Lessor's master or ground lessor, partners and
Lenders,  from and  against any and all claims,  loss of rents  and/or  damages,
costs,  liens,  |judgements,   penalties,   loss  of  permits,   attorneys'  and
consultants' fees, expenses and/or liabilities arising out of, involving,  or In
connection with the occupancy of the Premises by Lessee, the conduct of Lessee's
business,  any act,  omission  or neglect of Lessee,  Its  agents,  contractors,
employees  or  Invitees,  and out of any  Default  or  Breach  by  Lessee In the
performance  In a  timely  manner  of any  obligation  on  Lessee's  part  to be
performed under this Lease. The foregoing shall Include,  but not be limited to,
the  defense  or  pursuit  of any  claim or any  action or  proceeding  Involved
therein,  and  whether  or not  (In the  case of  claims  made  against  Lessor)
litigated  and/or  reduced to  judgement.  In case any action or  proceeding  be
brought  against Lessor by reason of any of the foregoing  matters,  Lessee upon
notice  from  Lessor  shall  defend  the same at  Lessee's  expense  by  counsel
reasonably satisfactory to Lessor and Lessor shall cooperate with Lessee In such
defense.  Lessor  need not  have  first  paid  any such  claim In order to be so
Indemnified.

      8.8  Exemption  of Lessor from  Liability.  Lessor shall not be liable for
injury or damage to the person or goods, wares, merchandise or other property of
Lessee,  Lessee's  employees,  contractors,  Invitees,  customers,  or any other
person In or about the  Premises,  whether such damage or injury Is caused by or
results from fire, steam, electricity, gas, water or rain, or from the breakage,
leakage,  obstruction  or  other  defects  of  pipes,  fire  sprinklers,  wires,
appliances,  plumbing,  air conditioning or lighting fixtures, or from any other
cause,  whether said injury or damage results from  conditions  arising upon the
Premises or upon other  portions of the  Building  of which the  Premises  are a
part, from other sources or places,  and regardless of whether the cause of such
damage or Injury or the means of repairing the same Is accessible or not. Lessor
shall not be liable for any damages arising from any act or neglect of any other
lessee of Lessor nor from the failure by Lessor to enforce the provisions of any
other lease in the Industrial  Center.  Notwithstanding  Lessor's  negligence or
breach of this Lease,  Lessor shall under no  circumstances be liable for Injury
to Lessee's business or for any loss of income or profit therefrom.

9. Damage or Destruction.

9.1 Definitions.

             (a) "Premises  Partial  Damage" shall mean damage or destruction to
the Premises, other than Lessee-Owned Alterations and Utility Installations, the
repair cost of which damage or  destruction  is less than fifty percent (50%) of
the then  Replacement  Cost (as  defined In  Paragraph  9.1(d)) of the  Premises
(excluding   Lessee-Owned   alterations  and  utility  installations  and  Trade
fixtures) Immediately prior to such damage or destruction.

             (b) "Premises Total  Destruction.  shall mean damage or destruction
to the Premises,  other than Lessee-Owned Alterations and Utility Installations,
the repair cost of which damage or destruction Is fifty percent (50%) or more of
the then Replacement Cost of the Premises  (excluding  Lessee-Owned  alterations
and utility  Installations and Trade fixtures)  immediately prior to such damage
or destruction.  In addition,  damage or destruction to the building, other than
Lessee-Owned  alterations  and utility  installations  and Trade fixtures of any
lessees  of the  building,  the cost of which  damage  or  destruction  of fifty
percent  (50%)  or more of the then  Replacement  Cost  (excluding  Lessee-Owned
alterations and utility  installations  and Trade fixtures of any lessees of the
Building)  of the  building  shall,  at the  option of  Lessor,  be deemed to be
Premises Total Destruction.

             (c)  "Insured  Loss"  shall  mean  damage  or  destruction  to  the
Premises,  other than  Lessee-Owned  Alterations and Utility  Installations  and
trade  fixtures was caused by an event  required to be covered by the  Insurance
described In Paragraph B.3(a) irrespective of any deductible amounts or coverage
limits Involved.

             (d) "Replacement Cost" shall mean the cost to repair or rebuild the
Improvements  owned by Lessor at the time of the  occurrence to their  condition
existing  Immediately prior thereto,  including  demolition,  debris removal and
upgrading required by the operation of applicable building codes,  ordinances or
laws, and without deduction for depreciation.

             (e) "Hazardous  Substance  Condition"  shall mean the occurrence or
discovery of a condition  Involving  the presence of, or a  contamination  by, a
Hazardous  Substance  as  deemed  In  Paragraph  6.2(a),  In,  on.  or under the
Premises.

      9.2 Premises  Partial  Damage - Insured Loss. If Premises  Partial  Damage
that is an Insured Loss occurs,  then Lessor shall, at Lessor s expense,  repair
such damage (but not Lessee s Trade  fixtures or  Lessee-Owned  Alterations  and
Utility  Installations  as soon as  reasonably  possible  end  the  Lease  shall
continue  In full  force and  effect.  In the  event,  however,  that there Is a
shortage of  Insurance  proceeds and such  shortage is due to the fact that,  by
reason  of  the  unique  nature  of  the  Improvements  In  the  Premises,  full
replacement  cost  Insurance  coverage  was  not  commercially   reasonable  and
available,  Lessor shall have no obligation to pay for the shortage In Insurance
proceeds or to fully  restore the unique  aspects of the Premises  unless Lessee
provides  Lessor with the funds to cover same,  or adequate  assurance  thereof,
within ten (10) days  following  receipt of written  notice of such shortage and
request  therefor.  If Lessor receives said funds or adequate  assurance thereof
within  said  ten  (t0)  day  period,  Lessor  shall  complete  them  as soon as
reasonably  possible  and this Lease shall  remain In full force and effect.  If
Lessor does not receive such funds or assurance  within said period,  Lessor may
nevertheless  elect by written notice to Lessee within ten (t0) days  thereafter
to make such  restoration and repair as Is  commercially  reasonable with Lessor
paying any shortage in  proceeds,  In which case this Lease shall remain In full
force and effect. If Lessor does not receive such funds or assurance within such
ten (10) day period, and if Lessor does not so elect to restore and repair, then
this Lease shall  terminate  sixty (60) days  following  the  occurrence  of the
damage or destruction.  Unless otherwise  agreed,  Lessee shall In no event have
any right to  reimbursement  from Lessor for any funds  contributed by Lessee to
repair any such damage or destruction.  Premises  Partial Damage due to flood or
earthquake  shall be  subject  to  Paragraph  9.3  rather  than  Paragraph  9.2,
notwithstanding that there may be some Insurance coverage,  but the net proceeds
of any such insurance  shall be made available for the repairs if made by either
Party.

      9.3 Partial  Damage - Uninsured  Lose. If Premises  Partial Damage that if
not an Insured  Loss  occurs,  unless  caused by a  negligent  or willful act of
Lessee (in which event  Lessee  shall make the  repairs at Lessee's  expense and
this Lease  shall  continue  In full force and  effect),  Lessor may at Lessor's
option, either (1) repair such damage as soon as reasonably possible at Lessor's
expense,  In which event this Lease shall continue in full force and effect,  or
(ii) give  written  notice to Lessee  within  thirty (30) days after  receipt by
Lessor of  knowledge  of the  occurrence  of such damage of  Lessor's  desire to
terminate  this Lease as of the date sixty (60) days  following the date of such
notice. In the event Lessor elects to give such notice of Lessor's  intention to
terminate this Lease, Lessee shall have the right within ten (10) days after the
receipt of such notice to give written  notice to Lessor of Lessee's  commitment
to pay for the repair of such  damage  totally at  Lessee's  expense and without
reimbursement  from Lessor.  Lessee shall provide Lessor with the required funds
or  satisfactory  assurance  thereof  within  thirty  (30) days  following  such
commitment  form Lessee.  In such event this Lease shall  continue In lull force
and effect,  and Lessor shall proceed to make such repairs as soon as reasonably
possible  after the required  funds are  available.  H Lessee does not give such
notice and provide the funds or  assurance  thereof  within the times  specified
above, this Lease shall terminate as of the date specified in Lessor's notice of
termination.

      9.4 Total  Destruction.  Notwithstanding  any other provision  hereof,  if
Premises Total  Destruction  occurs  (including any destruction  required by any
authorized  public  authority),  this  Lease  shall  terminate  sixty  (60) days
following the date of such Premises Total Destruction, whether or not the damage
or destruction Is an insured Loss or was caused by a negligent or willful act of
Lessee.  in the event,  however,  that the damage or  destruction  was caused by
Lessee,  Lessor  shall have the right to recover  Lessor's  damages  from Lessee
except as released and waived In Paragraph 9.7.

      9.5 Damage Near End of Term.  H at anytime  during the last six (6) months
of the term of this Lease  there Is damage for which the cost to repair  exceeds
one month's Base rent,  whether or not an Insured Loss,  Lessor may, at Lessor's
option,  terminate  this Lease  effective  sixty (60) days following the date of
occurrence  of such  damage by  giving  written  notice  to  Lessee of  Lessor's
election to do so within  thirty (30) days after the date of  occurrence of such
damage.  Provided,  however, if Lessee at that time has an exercisable option to
extend this Lease or to purchase the  Premises,  then Lessee may  preserve  this
Lease by (a) exercising such option,  and (b)providing  Lessor wlth any shortage
in insurance proceeds (or adequate  assurance/hereof) needed to make the repairs
on or before the  earlier  of 0) the date which is ten (10) days after  Lessee's
receipt of Lessor's  written notice  purporting to terminate this Lease, or (ii)
the day  prior to the date upon  which  such  option  expires.  If  Lessee  duly
exercises  such option  during such  period and  provides  Lessor with funds (or
adequate assurance thereof) to cover any shortage in insurance proceeds,  Lessor
shall, at Lessor's expense repair such damage as soon as reasonably possible and
this Lease shall continue in full force and effect.  If Lessee fails to exercise
such option and provide  such funds or assurance  during such period,  then this
Lease  shall  terminate  as of the date set forth in the first  sentence of this
Paragraph 9.5.

9.6 Abatement  of Rent; Lessee'e Remedies

             (a) In the event of (i) Premises  Partial  Damage or (ii) Hazardous
Substance Condition for which Lessee is not legally responsible,  the Base Rent,
Common Area  Operating  Expenses and other  charges,  if any,  payable by Lessee
hereunder  for the period  during  which such damage or  condition,  Its repair,
remediation  or  restoration  continues,  shall be abated In  proportion  to the
degree to which  Lessee's use of the Premises is impaired,  but not In excess of
proceeds from Insurance required to be canted under Paragraph 8.3(b). Except for
abatement of Base Rent,  Common Area Operating f expenses and other charges,  If
any, as aforesaid,  all other obligations of Lessee hereunder shall be performed
by Lessee, and Lessee shall have no claim against Lessor for any damage suffered
by reason of any such damage destruction, repair, remediation or restoration.

             (b) The Lessor shall be obligated to repair or restore the Premises
under  the  provisions  of  this  Paragraph  9  and  shall  not  commence,  In a
substantial and meaningful way, the repair or restoration of the Premises within
ninety (90) days after such  obligation  shall  accrue,  Lessee may, at any time
prior to the commencement of such repair or restoration,  give written notice to
Lessor and to any Lenders of which Lessee has actual notice of Lessee's election
to terminate  this Lease on e date not less than sixty (60) days  following  the
giving of such  notice.  11 Lessee  gives such notice to Lessor and such Lenders
and such repair or  restoration  is not commenced  within thirty (30) days after
receipt of such notice,  this Lease shall  terminate as of the date specified In
said notice.  The Lessor or a Lender  commences the repair or restoration of the
Premises  within thirty (30) days after the receipt of such notice,  this Lessee
shall  continue In full force and affect.  'Commencement  used In this Paragraph
9.6 shall mean after the  unconditional  authorization of the preparation of the
required plans,  or the beginning of the actual work on the Premises,  whichever
occurs first.

Initial:

9.7 Hazardous  Substance  Condition.  If a Hazardous Substance Condition occurs,
unless  Lessee Is legally  responsible  thereof (In which case lessee shall make
the  investigation and remediation  thereof required by Applicable  requirements
and this Lease shall continue In full force and effect,  but subject to Lessor's
rights under  Paragraph  6.2(c) and Paragraph 13), Lessor may at Lessor s option
either p)  Investigate  and remediate  such Hazardous  Substance  Condition,  if
required,  as soon as  reasonably  possible at Lessor s expense,  In which event
this Lease shall  continue In full force and  effect,  or (ii) if the  estimated
cost to Investigate  and remediate such condition  exceeds twelve (12) times the
then monthly Base Rent or $100,000 whichever Is greater,  give written notice to
Lessee  within  thirty  (30) days after  receipt by Lessor of  knowledge  of the
occurrence of such Hazardous Substance Condition of Lessor's desire to terminate
this Lease as of the date sixty (60) days following the date of such notice.  In
the event Lessor  elects to give such notice of Lessor's  Intention to terminate
this Lease,  Lessee  shall have the right within ten (10) days alter the receipt
of such notice to give written  notice to Lessor of Lessee's  commitment  10 pay
for the excess costs of (a)  investigation  end  remediation  of such  Hazardous
Substance Condition to the extent required by Applicable requirements,  over (b)
an amount  equal to twelve (12) times the then  monthly  Base Rent or  S100,000,
whichever 19 greater.  Lessee shall provide  Lessor with the /funds  required of
Lessee or satisfactory  assurance thereof within thirty (30) days following said
commitment by Lessee.  In such event this Lease shall continue In full force and
effect and Lessor shall proceed to make such  Investigation  and  remediation as
soon as reasonably  possible after the required  funds are available.  If Lessee
does not give such notice and provide the required  funds or  assurance  thereof
within the time period  specified  above,  this Lease shall  terminate as of the
data specified In Lessor's notice of termination.

      9.8  Termination  -  Advance  Payments.  Upon  termination  of this  Lease
pursuant to this Paragraph 9, Lessor shall return to Lessee any advance  payment
made by Lessee to Lessor  and so much of  Lessee's  Security  Deposit as has not
been,  or is not then  required  to be,  used by Lessor  under the terms of this
Lease.

      9.9 Waiver of  Statutes  Lessor  and  Lessee  agree that the terms of this
Lease shall govern the effect of any damage to  destruction  of the Premises and
the building with respect to the  termination of this Lease and hereby waive the
provisions  of any  present or future  statute to the extent It Is  inconsistent
herewlth.

10. Real Property Taxes.

      10.1  Payment  ot Taxes.  Lessor  shall pay the Real  Property  Taxes,  as
defined in Paragraph 10.2,  applicable to the Industrial  Center,  and except as
otherwise  provided in Paragraph 10.3, any such amounts shall be Included In the
calculation of Common Area Operating  Expenses In accordance with the provisions
of Paragraph 4.2.

      10.2 Real Property Tax Definition. As used herein, the term "Real Property
Taxes" shall Include any form of real estate tax or assessment, general special,
ordinary  or  extraordinary,   and  any  license  fee,  commercial  rental  tax,
Improvement bond or bonds, levy or tax (other than Inheritance,  personal Income
or estate taxes) Imposed upon the Industrial  Center by any authority having the
direct  or  Indirect  power  to  tax,  Including  any  city,  state  or  federal
government,  or any school,  agricultural,  sanitary, fire, street, drainage, or
other  Improvement  district  hereof,  levied  against  any  legal or  equitable
Interest of Lessor In the  Industrial  Center or any portion  thereof,  Lessor ~
right to rent or other Income therefrom, and/or Lessor's business of leasing the
Premises.  The term Real Property  Taxes" shall also Include any tax, fee, levy,
assessment  or  charge,  or any  Increase  therein,  Imposed by reason of events
occurring,  or changes In Applicable Law taking effect,  during the term of this
Lease,  Including but not limited to a change In the ownership of the Industrial
Canter or In the  improvements  thereon,  the  execution  of this Lease,  or any
modification,  amendment or transfer thereof, and whether or not contemplated by
the Parties.  In calculating Real Property Taxes for any calendar year, the Real
Property taxes for any real estate tax year shall be Included In the calculation
of Real Property Taxes hr such calendar year based upon the number of days which
such calendar year and tax year have In common.

      10.3  Additional  Improvements.  Common Area Operating  Expenses shall not
Include  Real  Property  Taxes  specified In the tax assessor s records and work
sheets as being caused by  additional  Improvements  placed upon the  Industrial
Center by other lessees or by Lessor for the  exclusive  enjoyment of such other
lessees.  Notwithstanding  Paragraph 10.1 hereof,  Lessee shall, however, pay to
Lessor at the time Common Area  Operating  expenses are payable under  Paragraph
4.2, the entirety of any increase In f teal Property Taxes If assessed solely by
reason of alterations,  Trade fixtures or Utility  installations placed upon the
Premises by Lessesor at lessee's request.

      10.4 Joint Assessment.  If the Buliding is not separately  assessed,  Peal
Property Taxes allocated to the Building shall be an equitable proportion of the
Real Property Taxes for all of the land and Improvements Included within the tax
parcel assessed,  such proportion to be determined by Lessor from the respective
valuations  assigned in the assessor's work sheets or such other  Information as
maybe reasonably available.  Lessor's reasonable  determination thereof, In good
faith, shall be conclusive.

      10.5 Lessee's  Properly  Taxes.  Lessee shall pay prior to delinquency all
taxes  assessed  against and levied upon  Lessee-Owned  Alterations  and Utility
installations,  Trade fixtures, furnishings, equipment and all personal property
of Lessee contained In the Premises or stored within the Industrial Center. When
possible,   Lessee  shall  cause  Its   Lessee-Owned   Alterations  and  Utility
Installations,  Trade  fixtures,  furnishings,  equipment and all other personal
property to be assessed and billed  separately from the real property of Lessor.
If any of Lessee's said property  shall be assessed with Lessor's real property,
Lessee shall pay lessor the taxes  attributable to Lessee's  property within ten
(10) days after recelpt of written  statement setting forth the taxes applicable
to Lessee's property.

11. Utilities. Lessee shall pay directly for all utilities and services supplied
to the Premises, Including but not limited to electricity,  telephone, security,
gas and cleaning of the Premises,  together with any taxes thereon.  If any such
utilities or services are not  separately  metered to the Premises or separately
billed to the Premises, Lessee shall pay to Lessor a reasonable proportion to be
determined  by Lessor of all such charges  jointly  metered or billed with other
premises In the Building, In the manner and within the time periods set forth In
Paragraph 4.2(d).

12. Assignment and Subletting.

12.1 Lessor's Consent Required.

             (a) Lessee  shall not  voluntarily  or by  operation of law assign,
transfer,  mortgage or otherwise transfer or encumber collectively,  assign.) or
sublet all or any part of  Lessee's  Interest  in this Lease or in the  Premises
without  Lessor's prior written  consent given under and subject to the terms of
Paragraph 36.

             (b)  A  change  In  the  control  of  Lessee  shall  constitute  an
assignment requiring Lessor's consent.  The transfer,  on a cumulative basis, of
twenty-five  percent  (25%)  or more  of the  voting  control  of  Lessee  shall
constitute a change In control for this purpose.

             (c) The Involvement of Lessee or Its assets In any transaction,  or
series  of  transactions  (by  way  of  merger,  sale,  acquisition,  financing,
refinancing,  transfer, leveraged buy-out or otherwise), whether or not a formal
assignment  or  hypothecatlon  of this Lease or Lessee's  assets  occurs,  which
results or will result In a reduction of the Net Worth of Lessee, as hereinafter
defined,  by an amount equal to or greater than  twenty-five  percent  (2516) of
such Net  Worth of Lessee  as It was  represented  to Lessor at the time of full
execution  and  delivery  of  this  Lease  or at the  time  of the  most  recent
assignment to which Lessor has consented,  or as It exists  immediately prior to
said  transaction or transactions  consulting such reduction,  at whichever time
said Net Worth of Lessee was or Is greater, shall be considered an assignment of
this Lease by Lessee to which Lessor may reasonably  withhold Its consent.  "Net
Worth of Lessee  for  purposes  of this  Lease  shall be the net worth of lessee
(excluding any  Guarantors)  established  under  generally  accepted  accounting
principles consistently supplied.

             (d) An assignment or subletting of Lessee's  interest in this Lease
without Lessor specific prior written consent shall,  at Lessor's  option,  be a
Default curable after notice per Paragraph 13.1, or a non-curable Breach without
the  necessity of any notice and grace  period.  If Lessor  elects to treat such
unconsented  to assignment or subletting as a non-curable  Breach,  Lessor shall
have the right to either:  p) terminate this Lease, or 01) upon thirty (30) days
written  notice  {'Lessor's  Notice',,  Increase  the monthly  Base Rent for the
Premises to the greater of the then  fairmarket  rental value of the Premises as
easonably  determined  by Lessor,or one hundred ten percent (1 t016) of the Base
Rent then In effect.  Pending  determination of the new fair market rental value
if disputed by Lessee, Lessee shall pay the amount set forth In Lessor's Notice,
with any  overpayment  credited  against  the next  Installment(s)  of Base Rent
coming due, and any underpayment  for the period  retroactively to the effective
date of the adjustment being due and payable  immediately upon the determinatlon
thereof.  Further,  in the  event of such  Breach  and  rental  adjustment,  the
purchase  price of any option to purchase the  Premises  held by Lessee shall be
subject  to  similar  adjustment  to the then fair  market  value as  reasonably
determined by Lessor  (without the Lease being  considered an encumbrance or any
deduction for depreciation or obsolescence,  and considering the Premises at Its
highest and best use and in good condition) or one hundred ten percent  (110%)of
the  price  previously  in  effect,  pi)  any  lndex-orlented  rental  or  price
adjustment  formulas  contained  In this Lease shall be adjusted to require that
the base Index be determined with reference to the index  applicable to the time
of such adjustment,  and (iii) any fixed rental adjustments scheduled during the
remainder  of the Lease  term  shall be  Increased  In the same ratio as the new
rental  bears to the Base Rent in  effect  Immediately  prior to the  adjustment
specified in Lessor's Notice.

(e)      Lessee's  remedy for any breach of this  Paragraph 12.1 by Lessor shall
         be Itemized to compensatory damages and/or Injunctive relief.

12.2 Terms and Conditions Applicable to Assignment and Subletting.

             (a)  regardless of Lessor's  consent,  any assignment or subletting
shall not (i) be  effective  without  the  express  written  assumption  by such
assignee or  sublessee  of the  obligations  of Lessee  under this  Lease,  (ii)
release  Lessee  of any  obligations  hereunder,  nor (iii)  alter  the  primary
liability  of Lessee  for the  payment  of Base Rent and other  sums due  Lessor
hereunder or for the  performance  of any other  obilgatlons  to be performed by
Lessee under this Lease.

             (b)  Lessor  may  accept  any  rent  or   performance  of  Lessee's
obligations from any person other than Lessee pending approval or disapproval of
an assignment. Neither a delay In the approval or disapproval of such assignment
nor the  acceptance  of any rent for  performance  shall  constitute a waiver or
estoppel of Lessor's right to exercise its remedies for the Default or Breach by
Lessee of any of the terms covenants or conditions of this Lease.

             (c) The consent of Lessor to any assignment or subletting shall not
constitute a consent with any  subsequent  assignment or subletting by Lessee or
to any  subsequent  or  successive  assignment  or subletting by the assignee or
sublessee. However, Lessor may consent to subsequent sublettings and assignments
of the sublease or any amendments or  modifications  thereto  without  notifying
Lessee or anyone  else  liable  under this  Lease or the  sublease  and  without
obtaining  their  consent,  and such action  shall not relieve such persons from
liability under this Lease or the sublease.

             (d) In the event of any  default or Breach of  Lessee's  obligation
under this Lease,  Lessor may proceed directly against Lessee, any Guarantors or
anyone else  responsible for the performance of the Lessee's  obligations  under
this Lease, Including any sublessee,  without first exhausting Lessor's remedies
against  any other  person or entity  responsible  therefor  to  Lessor,  or any
security held by Lessor.

             (e) Each request for consent to an assignment  or subletting  shall
be In writing,  accompanied by Information relevant to Lessor's determination to
the financial and operational responsibility and appropriateness of the proposed
assignee or  sublessee,  Including  but not limited to the  Intended  use and/or
required  modificatlon of the Premises,  If any,  together wlth  anon-refundable
deposit of $1,000 or ten percent  (10%) of the monthly base rent  applicable  to
the portion of the Premises  which Is the Subject of the proposed  assignment or
sublease,  whichever  is  greater,  as  reasonable  consideration  for  Lessor's
considering  and  processing  the request for consent.  Lessee agrees to provide
Lessor with such other or additlonal  Information and/or  documentatlon as maybe
reasonably requested by Lessor.

             (f) Any  assignee  of, or sublessee  under,  this Lease  shall,  by
reason of accepting such  assignment or entering Into such  sublease,  be deemed
for the benefit of Lessor, to have assumed and agreed to conform and comply with
each and every term, covenant, condition and obligation herein to be observed or
performed by Lessee during the term of said  assignment or sublease,  other than
such  obligations  as are  contrary to or  Inconsistent  with  provisions  of an
assignment or sublease to which Lessor has specifically consented In writing.

Initials:





<PAGE>


(9) The  occurrence of a transaction  described In Paragraph  12.2(c) shall give
Lessor the right (but not the  obligation) to require that the Security  Deposit
be Increased by an amount equal to six (6) times the then monthly Base Rent, and
Lessor may make the actual receipt by Lessor of the Security  Deposit increase a
condition to Lessor's consent to such transactlon.

             (h) Lessor,  as a condition to giving its consent to any assignment
or subletting,  may require that the amount and adjustment  schedule of the rent
payable  under this Lease be  adjusted to what is then the market  value  and/or
adjustment  schedule for property similar to the Premises and then  constituted,
as determined by Lessor.

      12.3  Additional  Terms  and  Conditions  Applicable  to  Subletting.  The
following terms and conditions shall apply to any subletting by Lessee of all or
any part of the Premises  and shall be deemed  Included In all  subleases  under
this Lease whether or not expressly incorporated therein:

             (a) Lessee  hereby  assigns and transfers to Lessor all of Lessee's
Interest In all rentals and income arising from any sublease of all or a portion
of the Premises  heretofore or hereafter made by Lessee,  and Lessor may collect
such rent and income  and apply  same  toward  Lessee's  obligations  under this
Lease;  provided,  however,  that until a Breach (as defined in Paragraph  13.1)
Shall occur In the performance of Lessee's  obligations under this Lease, Lessee
may, except 8B otherwise provided In this Lease, receive,  collect and enjoy the
rents accruing under such sublease. Lessor shall not, by reason of the foregoing
provision or any other  assignment of such sublease to Lessor,  nor by reason of
the collection of the rents from a sublessee,  be deemed liable to the sublessee
for any failure of Lessee to perform and comply with any of Lessee's obligations
to such sublessee under such Sublease.  Lessee hereby Irrevocably authorizes and
directs any such sublessee, upon receipt of a written notice from Lessor stating
that a Breach  exists in the  performance  of  Lessee's  obligations  under this
Lease,  to pay to Lessor the rents and other charges due and to become due under
the  sublease.  Sublessee  shall rely upon any such  statement  end request from
Lessor  and  shall  pay such  rents and other  charges  to  Lessor  without  any
obligation   or  right  to  inquire  as  to  whether  such  Breach   exists  and
notwithstanding  any notice  from or claim from Lessee to the  contrary.  Lessee
shall have no right or claim  against such  sublessee,  or, until the Breach has
been cured, against Lessor, for any such rents and other charges so paid by said
sublessee to Lessor.

             (b) In the event of a Breach by  Lessee in the  performance  of its
obligations  under this Lease,  Lessor, at its option and without any obligation
to do so, may require any  sublessee to attorn to Lessor,  in which event Lessor
shall  undertake the  obligations of the sublessor  under such sublease from the
time of the  exercise  of  said  option  to the  expiration  of  such  sublease;
provided,  however, Lessor shall not be liable for any prepaid rents or security
deposit paid by such sublessee to such sublessor or for any other prior defaults
or breaches of such sublessor under such sublease.

             (c) Any matter or thing  requiring the consent of the sublessor 
under a sublease shall also require the consent of Lessor herein.

             (d) No sublessee under a sublease  approved by Lessor shall further
assign or sublet and or any part of the Premises  without Lessor's prior written
consent.

             (e) Lessor shall  deliver a copy of any notice of Defaultor  Breach
by Lessee to the  sublessee,  who shall  have the right to cure the  Default  of
Lessee within the grace period, If any,  specified In such notice. The sublessee
shall have a right of  reimbursement  and offset from and against Lessee for any
such Defaults cured by the sublessee.

13. Default; Breach; Remedies.

      13.1  Default;  Breach.  Lessor and Lessee  agree that If an  attorney  Is
consulted  by  Lessor  In  connection  with  a  Lessee  Default  or  Breach  (as
hereinafter  defined),  $350.00 Is a reasonable  minimum sum per such occurrence
for legal  services  and costs in the  preparation  and  service  of a notice of
Default, and that Lessor may Include the cost of such services and costs In said
notice as rent due and payable to cure said  default.  A "Default"  by Lessee is
defined as a failure by Lessee to  observe,  comply  with or perform  any of the
terms,  covenants,  conditions or rules applicable to Lessee under this Lease. A
"Breach"  by  Lessee  Is  defined  as the  occurrence  of any one or more of the
following Defaults, and, where a grace period for cure after notice Is specified
herein,  the failure by Lessee to cure such Default  prior to the  expiration of
the applicable grace period, and shall entitle Lessor to pursue the remedies set
forth in Paragraphs 1 3.2 and/or 13.3:

(a)      The vacating of the Premises without the intention to reoccupy same, or
         the abandonment of the Premises.

(b)Except as expressly  otherwise  provided in this Lease, the failure by Lessee
to make any  payment  of Base  Rent,  Lessee's  Share of Common  Area  Operating
Expenses,  or any other monetary payment required to be made by Lessee hereunder
as and when due,  the  failure  by  Lessee to  provide  Lessor  with  reasonable
evidence of Insurance or surety bond required  under this Lease,  or the failure
of Lessee to  fulfill  any  obligation  under  this  Lease  which  endangers  or
threatens life or property,  where such failure  continues for a period of three
(3) days following written notice thereof by or on behalf of Lessor to Lessee.

             (c) Except as  expressly  otherwise  provided  In this  Lease,  the
failure by Lessee to provide Lessor with reasonable  written evidence given duly
executed  original  form,  If  applicable)  to (i)  compliance  with  Applicable
Requirements  per Paragraph 6.3, (ii) the  Inspection,  maintenance  and service
contracts   required  under  Paragraph  7.1(b),   {ill)  the  rescission  of  an
unauthorized  assignment  or  subletting  per  Paragraph  12.1,  (iv) a  Tenancy
Statement per Paragraphs 16 or 37, {v) the subordination or non-subordination of
this Lease per  Paragraph 30, (vi) the guaranty of the  performance  of Lessee's
obligations under this Lease if required under Paragraphs 1.11 and 37, (vii) the
execution of any document  requested under  Paragraph 42 (easements),  or (viii)
any other  documentation or Information  which Lessor may reasonably  require of
Lessee  under the terms of this lease,  where any such failure  continues  for a
period of ten (10) days  following  written  notice by or on behalf of Lessor to
Lessee.

             (d) A Default by Lessee en to the terms,  covenants,  conditions or
provisions of this Lease, or of the rules adopted under Paragraph 40 hereof that
are to be  observed,  complied  with or  performed  by Lessee,  other than those
described  In  Subparagraphs  13.1(a),  (b) or (c),  above,  where such  Default
continues for a period of thirty (30) days after written notice thereof by or on
behalf of Lessor to Lessee;  provided,  however,  that if the nature of Lessee's
Default Is such that more than thirty (30) days are reasonably  required for its
cure,  then it shall not be  deemed  to be a Breach  of this  Lease by Lessee If
Lessee  commences  such cure within  said thirty (30) day period and  thereafter
diligently prosecutes such cure to completion.

             (e) The occurrence of any of the following events: 0) the making by
Lessee of any general  arrangement  or assignment  for the benefit of creditors;
{ii) Lessee's  becoming a debtor.  as defined In 11 U.S. Code Section 101 or any
successor  statute  thereto  (unless,  in the case of a petition  filed  against
Lessee, the same 1s dismissed within sixty (60) days); (vii)) the appointment of
a trustee or receiver to take possession of substantially all of Lessee's assets
located at the Premises or of Lessee's interest in this Lease,  where possession
is not  restored  to Lessee  within  thirty (30) days;  or liv) the  attachment,
execution or other  judicial  seizure of  substantially  all of Lessee's  assess
located at the  Premises  or of  Lessee's  Interest  In this  Lease,  where such
seizure is not discharged  within thirty (30) days;  provided,  however,  In the
event  that any  provision  of this  Subparagraph  13.t(e)  Is  contrary  to any
applicable  law, such  provision  shall be of no force or effect,  and shall not
affect the validity of the remaining provisions.

             p) The discovery by Lessor that any  financial  statement of Lessee
or of any Guarantor,  given to Lessor by Lessee or any Guarantor, was materially
false.

             (g) If the performance of Lessee's  obligations under this Lease is
guaranteed:  (~) the death of a Guarantor, (11) the termination of a Guarantor's
liability  with respect to this lease other than In accordance  with the term of
such  guaranty,  (iii) a  Guarantor's  becoming  insolvent  or the  subject of a
bankruptcy  filing,  (iv) a Guarantor's  refusal to honor the guaranty,  or (v)a
Guarantor's breach of Its guaranty  obilgation on an anticipatory  breach basis,
and Lessee's  failure,  within sixty(60) days following  written notice by or on
behalf of Lessor to Lessee of any such event,  to provide  Lessor  with  written
alternative  assurances of security,  which, when coupled with the then existing
resources  of Lessee,  equals or exceeds the  combined  financial  resources  of
Lessee and the Guarantors that existed at the time of execution of this Lease.

      13.2  Remedies.  If  Lessee  fails  to  perform  any  affirmative  duty or
obligation of Lessee under this Lease, within ten (10) days after written notice
to Lessee (or In case of an emergency, without notice), Lessor may at Its option
(but without  obligation to do so),  perform such duty or obligation on Lessee's
behalf, Including but not limited to the obtaining of reasonably required bonds,
Insurance policies, or governmental  licenses,  permits or approvals.  The costs
and  expenses  of any such  performance  by Lessor  shall be due and  payable by
Lessee to Lessor upon  invoice  therefor.  N any check given to Lessor by Lessee
shall not be  honored  by the bank upon  which It is drawn,  Lessor,  at its own
option, may require all future payments to be made under this Lease by Lessee to
be made only by  cashier's  check.  In the  event of a Breach  of this  Lease by
Lessee (as defined In Paragraph 13.1), with or without further notice or demand,
and without  limiting Lessor In the exercise of any right or remedy which Lessor
may have by reason of such Breach, Lessor may:

             (a) Terminate  Lessee's  right to possession of the Premises by any
lawful means,  In which case this Lease and the term hereof shall  terminate and
Lessee shall Immediately surrender possession of the Premises to Lessor. In such
event Lessor shall be entitled to recover from Lessee: (i) the worth at the time
of the  award  of the  unpaid  rent  which  had  been  earned  at  the  time  of
termination;  (ii) the  worth at the time of award of the  amount  by which  the
unpaid rent which would have been earned a  termination  until the time of award
exceeds the amount of such rental  loss that the Lessee  proves  could have been
reasonably avoided;  (iii) the worth at the time of award of the amount by which
the unpaid rent for the balance of the term after the time of award  exceeds the
amount of such rental loss that the Lessee proves could be  reasonably  avoided;
and (iv) any other amount  necessary to compensate  Lessor for all the detriment
approximately  caused by the Lessee's  failure to perform Its obligations  under
this Lease or which In the  ordinary  course of things would be likely to result
therefrom, including but not limited to the cost of recovering possession of the
Premises,  expenses of reletting,  including necessary renovation and alteration
o/ the Premises,  reasonable  attorneys'  fees,  and that portion of any leasing
commission  paid by  Lessor In  connection  with this  Lease  applicable  to the
unexpired  term of this  Lease.  The  worth in the  time of award of the  amount
referred to In provision  f~lH) of the Immediately  preceding  sentence shall be
computed by discounting  such amount at the discount rate of the Federal Reserve
Bank of San Francisco or the Federal Reserve Bank District In Which the Premises
are  located at the time of award plus one  percent  (1%).  Efforts by Lessor to
mitigate  damages  caused by Lessee's  Default or Breach of this Lease shall not
waive  Lessor's  right  to  recover   damages  under  this  Paragraph  13.2.  If
termination of this Lease is obtained through the provisional remedy of unlawful
detainer,  Lessor shall have the right to recovering  such proceeding the unpaid
rent and damages as are recoverable  therein, or Lessor may reserve the right to
recover all or any part thereof in a separate suit for such rent and/or damages.
If a notice and grace period  required under  Subparagraph  13.1 (b), (c) or (d)
was not  previously  given, a notice to pay rent or quit, or to perform or quit,
as the case may be, given to Lessee under any statute authorizing the forfeiture
of leases for unlawful  detainer shall also constitute the applicable notice for
grace period  purposes  required by  Subparagraph  13.1 (b), (c) or (d). In such
case, the applicable  grace period under the unlawful  detainer statue shall run
concurrently  after the one such statutory notice,  and the failure of Lessee to
cure the  default  within the  greater of the two (2) such grace  perlods  shall
constitute both an unlawful detainer and a Breach of this Lease entitling Lessor
to the remedial provided for in this Lease and/or by said statute.

             (b) Continue the Lease and Lessee's  right to  possession In effect
in California  under California Civil Code Section 1951.4) after Lessee's Breach
and recover the rent as It becomes due,  provided Lessee has the right to sublet
or assign, subject only to reasonable limitations.  Lessor and Lessee agree that
the limitations on assignment and subletting in this Lease are reasonable.  Acts
of  maintenance  or  preservation,  efforts  to  reflect  the  Premises,  or the
appointment  of a receive to protect  the  Lessor's  Interest  under this Lease,
shall not constitute a termination of the Lessee's right to possession.

          (c) Pursue any other remedy now or hereafter available to Lessor under
the laws or judicial decisions of the state wherein the Premises are located.

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<PAGE>


          (d) The expiration or termination of this Lease and/or the termination
of Lessee B right to  possession  shall  not  relieve  Lessee  from  liability  
under  any indemnity  provisions of this Lease as to matters  occurring or 
accruing  during the term hereof or by reason of Lessee's occupancy of the 
Premises.

      13.3 Inducement  recapture In Event of Breach. Any agreement by Lessor for
free or abated rent or other  charges  applicable  to the  Premises,  or for the
giving  or  paying  by  Lessor  to or for  Lessee  of any cash or  other  bonus,
inducement or consideration  for Lessee's entering Into this Lease, all of which
concessions  are  hereinafter  referred to as "Inducement  Provisions"  shall be
deemed  conditioned  upon Lessee s full and faithful  performance  of all of the
terms,  covenants  and  conditions  of this Lease to be performed or observed by
Lessee during the term hereof as the same may be extended.  Upon the  occurrence
of a Breach (as  defined in  Paragraph  13.1)on  this Lease by lessee,  any such
Inducement  Provision shall  automatically be deemed deleted from this Lease end
of no further force or effect, and any rent, other charge, bonus,  Inducement or
consideratlon  therefore  debated,  given  or  pald  by  Lessor  under  such  an
Inducement  Provision  shall be Immedlately due and payable by Lessee to Lessor,
and   recoverable  by  Lessor,   as  additional   rent  due  under  this  Lease,
notwithstanding  any subsequent cure of said Breach by Lessee, The acceptance by
Lessor of rent or the cure of the Breach which  initialed  the operation of this
Paragraph  13.3 shall not be deemed a waiver by Lessor of the provisions of this
Paragraph 13.3 unless specifically so stated in writing by Lessor at the time of
such acceptance.

      13.4 Late Charges.  Lessee hereby acknowledges that late payment by Lessee
to Lessor of rent and other sums due hereunder  will cause Lessor to Incur costs
not  contemplated  by this Lease,  the exact  amount of which will be  extremely
difficult to ascertain.  Such costs Include,  but are not limited to, processing
and accounting charges, and late charges which may be Imposed upon Lessor by the
terms of any ground  lease,  mortgage or deed of trust  covering  the  Premises.
Accordingly,  If any  Installment of rent or other sum due from Lessee shall not
be  received  by Lessor or  Lessor's  designee  within  ten (10) days after such
amount shall be due, then, without any requirement for notice to Lessee,  Lessee
shall pay to Lessor a late  charge  equal to six  percent  (6%) of such  overdue
amount.  The parties  hereby  agree that such late charge  represents a fair and
reasonable  estimate of the costs Leasor will Incur by reason of late payment by
Lessee.  Acceptance o/ such late charge by Lessor shall In no event constitute a
waiver of Lessee's  Default or Breach with respect to such overdue  amount,  nor
prevent  Lessor from  exercising  any of the other rights and  remedies  granted
hereunder. In the event that a late charge Is payable hereunder,  whether or not
collected,   for  three  (3)   consecutive   Installments  of  Base  Rent,  then
notwithstanding  Paragraph  4.1 or any  other  provision  of this  Lease  to the
contrary,  Base Rent shall, at Lessor's option, become due and payable quarterly
In advance.

      13.5 Breach by Lessor.  Lessor shall not be deemed In breach of this Lease
unless Lessor fails within a reasonable  time to perform an obligation  required
to be performed by Lessor.  For  purposes of this  Paragraph  13.5, a reasonable
time shall In no event be less than  thirty  (30) days after  receipt by Lessor,
and by any Lender(s)  whose name and address shall have been furnished to Lessee
In  writing  for  such  purpose,  of  written  notice  specifying  wherein  such
obligation  of Lessor has not been  performed:  provided,  however,  that if the
nature of Lessor's obligation Is such that more then thirty (30) days after such
notice arer easonably required for its performance,  then Lessor shall not be In
breach of this Lease If  performance  is  commenced  within such thirty (30) day
period and thereafter diligently pursued to completion.

14.  Condemnation.  K the  Premises or any  portion  thereof are taken under the
power of eminent  domain or sold under the threat of the  exercise of said power
(all of which are herein called condemnation.), this Lease shall terminate as to
the  part so  taken  as of the date  the  condemning  authority  taken  title or
possession, whichever first occurs. If more than ten percent (1096) of the floor
area of the Premises,  or more than twenty-five  percent (25%) of the portion of
the Common Areas  designated  for Lessee's  parking,  Is taken by  condemnation,
Lessee may, at Lessee's option,  to be exercised In writing within ten (10) days
after Lessor shall have given  Lessee  written  notice of such taking (or In the
absence of such  notice,  within ten (10) days  after the  condemning  authority
shall have taken possession)  terminate this Lease as of the date the condemning
authority  takes such  possession.  If Lessee does not  terminate  this Lease In
accordance with the foregoing,  this Lease shall remain In full force and effect
as to the portion of the Premises remaining,  except that the Base Rent shall be
reduced In the same  proportion as the rentable floor area of the Premises taken
bears to the total  rentable  floor area of the  Premises.  No reduction of Base
Rent  shall  occur If the  condemnation  does not  apply to any  portion  of the
Premises.  Any award for the taking of all or any part of the Premises under the
power of eminent domain or any payment made under threat of the exercise of such
power  shall be the  property  of Lessor,  whether  such award  shall be made as
compensation  for  diminution of value of the leasehold or for the taking of the
fee, or as severance damages:  provided,  however, that Lessee shall be entitled
to any  compensation,  separately  awarded  to Lessee  for  Lessee's  relocation
expenses and/or loss of Lessee's Trade Fixtures. In the event that this Lease Is
not terminated by reason of such condemnation, Lessor shall to the extent of Its
net severance damages  received,  over and above Lessee's Share of the legal and
other expenses Incurred by Lessor In the condemnation matter,  repair any damage
to  the  Premises  caused  by  such  condemnation  authority.  Lessee  shall  be
responsible  for the  payment  of any  amount In  excess  of such net  severance
damages required to complete such repair.

15. Brokers Fees.

15.1     Procuring  Cause.  The  Broker(s)  named In  Paragraph  1.10 Is/are the
         procuring cause of this Lease.

      15.2 Additional  Terms.  Unless Lessor and broker(s) have otherwise agreed
In writing,  Lessor agrees that: (a) If Lessee  exercises any option (as defined
In Paragraph 39.1) granted under this Lessor any Option subsequently granted, or
(b) If Lessee  acquires  any rights to the  Premises or other  premises in which
Lessor has an Interest,  or (c) If Lessee  remains In possession of the Premises
with the consent of Lessor alter the  expiration of the term of this Lease alter
having  failed to exercise an Option,  or (d) If said Brokers are the  procuring
cause of any other lease or sale entered Into between the Parties  pertaining to
the Premises  and/or any adjacent  property In which Lessor has an Interest,  or
(e) If  Base  Rent  Is  Increased,  whether  by  agreement  or  operation  of an
escalation clause herein,  then as to any of said  ransactlons,  Lessor shall be
said Broker(s) a fee in accordance with the schedule of said Broker(s) In effect
at the time of the execution of this Lease.

      15 3  Assumption  of  Obligations.  Any  buyer or  transferee  of Lessor s
Interest In this Lease, whether such transfer Is by agreement or by operation of
law, shall be deemed to have assumed  Lessor's  obligation  under this Paragraph
15. Each Broker shall be an Intended  third party  benificiary of the provisions
of Paragraph  1.10 and of this Paragraph 15 to the extent of its interest in any
commisslon  arising from this Lease and may enforce that right directly  agalnst
Lessor and Its successors.

      15.4  Representation and Warranties.  Lessee and Lessor each represent and
warrant to the other that It has had no dealings with any person, firm broker or
finder  other  than as  named  In  Paragraph  1.10(a)  In  connection  with  the
negotiation  of  this  Lease  and/or  the   consummation   of  the   transaction
contemplated  hereby,  and that no broker or other person,  firm or entity other
than said named  Broker(s)  Is entitled  to any  commission  or finder's  fee in
connection  with said  transaction.  Lessee and Lessor do each  hereby  agree to
Indemnify,  protect,  defend  and  hold the  other  harmless  from  and  against
liability for  compensation  or charges which may be claimed by any such unnamed
broker,  finder or other  similar  party by reason of any dealings or actions of
the indemnifying Party,  Including any costs,  expenses,  and/or attorneys' fees
reasonably Incurred with respect thereto.

16. Tenancy and Financial Statements.

      16.1 Tenancy Statement.  Each Party (as "Responding  Party',  shall within
ten (10) days after written notice from the other Party (the "Requesting Party',
execute,  acknowledge and deliver to the Requesting Party a statement In writing
In a form similar to the then most current tenancy  Statement" form published by
the  American   industrial  Real  Estate   Association,   plus  such  additional
Information,  confirmation  and/or statements as may be reasonably  requested by
the Requesting Party.

      16.2 Financial Statement. If Lessor decides to finance, refinance, or sell
the Premises or the  Building,  or any part thereof,  Lessee and all  Guarantors
shall  deliver to any  potential  lender or purchaser  designated by Lessor such
financial statements of Lessee and such Guarantors as may be reasonably required
by such lender or  purchaser,  including  but not limited to Lessee's  financial
statements for the past three (3) years. All such financial  statements shall be
received by Lessor and such lender or purchaser In confidence  and shall be used
only for the purposes herein set forth.

17. Lessor's Liability. The term "Lessor" as used herein shall mean the owner or
owners at the time In question of the fee title to the Premises. In the event of
a transfer  of  Lessor's  title or  Interest  In the  Premises or In this Lease,
Lessor  shall  deliver to the  transferee  or assignee on cash or by credit} any
unused  Security  Deposit  held  by  Lessor  at the  time of  such  transfer  of
assignment.  Except as provided Paragraph 15.3, upon such transfer or assignment
and delivery of the Security  Deposit,  as aforesaid,  the prior Lessor shall be
relieved of all liability with respect to the obligations and/or covenants under
this Lease  thereafter to be performed by the Lessor.  Subject to the foregoing,
the  obligations  and/or  covenants  In this Lease to be performed by the Lessor
shall be binding only upon the Lessor as hereinabove  defined. 18. Severabillty.
The  Invalidity  of any  provision of this Lease,  as  determined  by a court of
competent  jurisdiction,  shall  in no way  affect  the  validity  of any  other
provision hereof.

19. Interest on Past-Due Obligation.  Any monetary payment due Lessor hereunder,
other than late charges,  not received by Lessor within ten (10) days  following
the date on which It was due, shall bear interest from the date due at the prime
rate  charged  by the  largest  state  chartered  bank in the state In which the
Premises are located plus four percent  (496) per annum,  but not  exceeding the
maximum rate allowed by law, In addition to the potential  late charge  provided
for In Paragraph 13.4.

20. Time of Essence.  Time is of the essence with respect to the  performance of
all obligations to be performed or observed by the Partied under this Lease.

21. Rent Defined . All monetary  obilgatlons of Lessee to Lessor under the terms
of this Lease are deemed to be rent.

22. No Prior or other  Agreement;  Broker  Disclaimer.  This Lease  contains all
agreements  between the Parties with respect to any matter mentioned herein, and
no other prior or contemporaneous agreement or understanding shall be effective.
Lessor and Lessee each  represents and warrants to the Brokers that It has made,
and Is relying  solely upon,  its own  investigaton  as to the nature,  quality,
character and financial  responsibillty  of the other Party to this Lease and as
to  the  nature,  quality  and  character  of  the  Premises.  Brokers  have  no
responsibility  wlth  respect  thereto or wlth  respect to any default or breach
hereof by either Party. Each Broker shall be an intended third party beneflclary
of the provislons of this Paragraph 22.

23. Notices.

      23.1 Notice requirements.  All notices required or premitted by this Lease
shall be In writing and may be  delivered  In person (by hand or by messenger or
courier service) or may be sent by regular, certified or registered mail or U.S.
Postal Service Express Mall, with postage prepaid, or by facsimile  transmission
during normal business hours, and shall be deemed  sufficiently  given if served
In a manner  specified In this  Paragraph 23. The addresses  noted adjacent to a
Party's  signature on this Lease shall be that  Party's  address for delivery or
mailing of notice  purposes.  Either  Party may by  written  notice to the other
specify a different  address  for notice  purposes,  except  that upon  Lessee's
taking  possession  of the  Premises,  the Premises  shall  constitute  Lessee's
address for the purpose of mailing or  delivering  notices to Lessee.  A copy of
all  notices  required or  permitted  to be given to Lessor  hereunder  shall be
concurrently  transmitted  to such party or parties at such  addresses as Lessor
may from time to time hereafter designate by written notice to Lessee.

23.2 Date of Notice.  Any notice sent by  registered or certified  mall,  return
receipt  requested,  shall be deemed given on the date of delivery  shown on the
receipt card, or If no delivery date is shown, the postmark thereon.  If sent by
regular mail, the notice shall be deemed given  forty-eight (48) hours after the
name is addressed as required  herein and mailed with postage  prepaid.  Notices
delivered by United  States  Express Mail or overnight  courier that  guarantees
next day

Initials::

delivery shall be deemed given twenty-four (24) hours after delivery of the same
to the United States Postal Service or courier.  If any notice Is transmitted by
facsimile  transmission  or similar  means,  the same shall be deemed  served or
delivered   upon  telephone  or  facsimile   confirmation   of  receipt  of  the
transmission thereof, provided a copy Is also delivered via delivery or mail. If
notice Is  received on a Saturday  or a Sunday or a legal  holiday,  it shall be
deemed received on the next business day.

24. Waivers.  No waiver by Lessor of the Default or Breach of any term, covenant
or  condition  hereof by  Lessee,  shall be  deemed a waiver of any other  term,
covenant or condition hereof,  or of any subsequent  Default or Breach by Lessee
of the same or any other term,  covenant or condition  hereof.  Lessor's consent
to, or approval of, any such act shall not be deemed to render  unnecessary  the
obtaining of Lessor's  consent to, or approval of, any subsequent or similar act
by Lessee,  or be construed as the basis of an estoppel to enforce the provision
or  provisions  of this Lease  requiring  such  consent.  regardless of Lessor's
knowledge of a Default or breach at the time of accepting  rent,  the acceptance
of rent by Lessor  shall not be a waiver of any  Default  or Breach by Lessee of
any  provision  hereof.  Any payment  given  Lessor by Lessee may be accepted by
Lessor  on  account  of  moneys  or  damages  due  Lessor,  notwithstanding  any
qualifying  statements  or conditions  made by Lessee In  connection  therewith,
which statements  and/or  conditions  shall be of no force or effect  whatsoever
unless  specifically  agreed to In  writing  by Lessor at or before  the time of
deposit of such payment.

25.  Recording.  Wither  Lessor or Lessee  shall,  upon  request  of the  other,
execute,  acknowledge  and deliver to the other a short form  memorandum of this
Lease  for  recording  purposes.  The  Party  requesting  recordation  shall  be
responsible for payment of any fees or taxes applicable thereto.

26.  No Right To  Holdover.  Lessee  has no right to  retain  possession  of the
Premises or any part thereof  beyond the  expiration or earlier  termination  of
this Lease.  In the event that Lessee holds over In violation of this  Paragraph
26 then the Base  Rent  payable  from and after  the time of the  expiration  or
earlier  termination  of this Lease shall be  Increased  to two hundred  percent
(20016) of the Base Rent applicable during the month Immediately  preceding such
expiration or earlier  termination.  Nothing contained herein shall be construed
as a consent by Lessor to any holding over by Lessee.

27.  Cumulative  Remedies  No  remedy  or  election  hereunder  shall be  deemed
exclusive but shall,  wherever possible, be cumulative with all other remediesat
law or In equity.

28.  Covenants  and  Conditions.  Ml  provisions of this Lease to be observed or
performed by Lessee are both covenants and conditions.

29. Binding Effect; Choice of Law. This Lease shall be binding upon the Parties,
their  personal  representatives,  successors and assigns and be governed by the
laws of the State In which the Premises are located.  Any litigation between the
Parties hereto  concerning  this Lease shall be Initiated In the county In which
the Premises are located.

30. Subordination; Attornment; Non-Disturbance.

      30.1  Subordination.  This Lease and any Option  granted  hereby  shall be
subject and subordinate to any ground lease,  mortgage,  deed of trust, or other
hypothecatlon  or security  device  (collectively,  "Security  Device"),  now or
hereafter  placed by Lessor upon the real  property of which the  Premises are a
part, to any and all advances made on the security thereof, and to all renewals,
modifications,  consolidations,  replacements  and  extensions  thereof.  Lessee
agrees that the Lenders  holding any such  Security  Device  shall have no duty,
llabillty or obligation to perform any of the  obligations  of Lessor under this
Lease  but that In the  event  of  Lessor's  default  with  respect  to any such
obligation,  Lessee  will  give any  Lender  whose  name and  address  have been
furnished Lessee In writing for such purpose notice of Lessor's default pursuant
to  Paragraph  13.5.  If any Lender  shall  elect to have this Lease  and/or any
Optlon granted hereby superior to the lien of Its Security Device and shall give
written  notice  thereof to Lessee,  this Lease and such Options shall be deemed
prior  to such  Security  Device,  notwithstanding  the  relative  dates  of the
documentation or recordation thereof.

      30.2 Attornment.  Subject to the  non-disturbance  provisions of Paragraph
30.3,  Lessee  agrees to attorn  to a Lender  or any  other  party who  acquires
ownership of the Premises by reason of a foreclosure of a Security  Device,  and
that In the event of such  foreclosure,  such new owner shall not: (i) be liable
for any act or omission of any prior lessor or with respect to events  occurring
prior to  acquisition  of  ownership,  (ii) be sublet to any offsets or defenses
which  Lessee  might  have  against  any  prior  lessor,  or  (iii)  be bound by
prepayment of more than one month's rent.

      30.3  Non-Disturbance.  With respect to Security  Devices  entered into by
Lessor after the execution of this lease,  Lessee's  subordination of this Lease
shall be subject to receiving assurance (a non-disturbance  agreement") from the
Lender that Lessee's possession and this Lease,  including any options to extend
the term hereof, will not be disturbed so long as Lessee Is not In Breach hereof
and attorns to the record owner of the Premises.

      30.4  Self-Executing.  The agreements contained in this Paragraph 30 shall
be effective without the execution of any further  documents,  provided however,
that upon  written  request from Lessor or a Lender In  connection  with a sale,
financing or  refinancing  of Premises,  Lessee and Lessor shall  execute;  such
further writings as may be reasonably  required to separately  document any such
subordination or non-subordination,  attornment and/or non-disturbance agreement
as is provided for herein.

31.  Attorneys'  Fees.  If any Party or Broker brings an action or proceeding to
enforce the terms hereof or declare rights  hereunder,  the Prevailing Party (as
hereafter defined) In any such proceeding,  action, or appeal thereon,  shall be
entitled to  reasonable  Attorneys'  fees.  Such fees may be awarded In the same
suit or recovered In a separate  suit,  whether or not such action or proceeding
Is pursued to decision or judgment.  The term "Prevailing  Party" shall Include,
without limitation,  a Party or Broker who substantially  obtains or defeats the
relief sought, as the case may be, whether by compromise, settlement, judgement,
or the  abandonment  by the other Party or Broker of its claim or  defense.  The
attorneys'  fee award  shall not be computed  In  accordance  with any court fee
schedule, but shall be such as to fully reimburse all attorneys' fees reasonably
Incurred.  Lessor  shall be  entitled to  attorneys'  fees,  costs and  expenses
Incurred In preparation and service of notices of Default and  consultations  In
connection therewith, whether or not a legal action Is subsequently commenced in
connection  with such Default or resulting  Breach.  Broker(s) shall be Intended
third party beneficiaries of this Paragraph 31.

32. Lessor's Access; Showing Premise;  Repairs. Lessor and Lessor's agents shall
have the right to enter the Premises at any time,  In the case of an  emergency,
and  otherwise  at  reasonable  times for the  purpose  of  showing  the same to
prospective  purchasers,  lenders,  or  lessees,  and making  such  alterations,
repairs, Improvements or additions to the Premises or to the Building, as Lessor
may  reasonably  deem  necessary.  Lessor  may at any time place on or about the
Premises or Building  any  ordinary  "For Sale" signs and Lessor may at any time
during the last one hundred  eighty  (180) days of the term  hereof  place on or
about the Premises any ordinary "For Lease" signs.  As such activities of Lessor
shall be without abatement of rent or liability to Lessee.

33.  Auctions.  Lessee shall not  conduct,  nor permit to be  conducted,  either
voluntarily or involuntarily, any auction upon the Premises without first having
obtained  Lessor's  prior  written  consent.  Notwithstanding  anything  to  the
contrary In this Lease,  Lessor  shall not be obligated to exercise any standard
of reasonableness In determining whether to grant such consent.

34. Signs.  Lessee shall not place any sign upon the exterior of the Premises or
the  Building,  except that Lessee may, with  Lessor's  prior  written  consent,
install (but not on the roof)such signs as are reasonably  required to advertise
Lessee's  own  business so long  assuch  signs are in a location  designated  by
Lessor  and  comply  with  Applicable  requirements  and  the  signage  criteria
established for the Industrial Center by Lessor. The Installation of any sign on
the Premises by or for Lessee shall be subject to the  provisions of Paragraph 7
(Maintenance,  Repairs, Utility Installations,  Trade Fixtures and Alterations).
Unless otherwise expressly agreed herein,  Lessor reserves all rights to the use
of the roof of the Building,  and the right to Install  advertising signs on the
Building,  Including  the roof,  which do not  unreasonably  interfere  with the
conduct of Lessee's business; Lessor shall be entitled to all revenues from such
advertising signs.

35.  Termination;  Merger.  Unless  specifically  stated otherwise In writing by
Lessor,  the  voluntary or other  surrender of this Lease by Lessee,  the mutual
termination or cancellation hereof, or a termination hereof by Lessor for Breach
by Lessee,  shall  automatically  terminate any sublease or lesser estate In the
Premises:  provided,  however, Lessor shall, In the event of any such surrender,
termination or  cancellation,  have the option to continue any one or all of any
existing subtenancles.  Lessor's failure within ten (10) days following any such
event to make a written election to the contrary by written notice to the holder
of any such lesser  Interest,  shall constitute  Lessor's  election to have such
event constitute the termination of such interest.

36. Consents.

             (a) Except  for  Paragraph  33 hereof  (Auctions)  or as  otherwise
provided herein, wherever In this Lease the consent of a Party is required to an
act by or for the other Party,  such consent shall not be unreasonably  withheld
or delayed.  Lessor's actual  reasonable  costs and expenses  (Including but not
limited to  architects',  attorneys',  engineers' end other  consultants'  fees)
Incurred In the  consideration  of, or response  to, a request by Lessee for any
Lessor  consent  pertaining  to this Lease or the  Premises,  Including  but not
limited to consents to an  assignment a  subletting  or the presence or use of a
Hazardous  Substance,  shall be paid by  Lessee  to Lessor  upon  receipt  of an
invoice  and  supporting  documentation  therefor.  In  addition  to the deposit
described in Paragraph  12.2(e),  Lessor may, as a condition to considering  any
such  request by Lessee,  require  that Lessee  deposit with Lessor an amount of
money (In addition to the Security  Deposit held under  Paragraph 5)  reasonably
calculated by Lessor to represent the cost Lessor will Incur in considering  and
responding  to Lessee's  request.  Any unused  portion of said deposit  shall be
refunded to Lessee without interest.  Lessor's consent to any act, assignment of
this Lease or  subletting  of the  Premises by Lessee  shall not  constitute  an
acknowledgment  that no Default or Breach by Lessee of this  Lease  exists,  nor
shall such  consent be deemed a waiver of any then  existing  Default or Breach,
except as may be otherwise  specifically stated In writing by Lessor at the time
of such consent.

             (b) All conditions to Lessor's consent authorized by this Lease are
acknowledged  by Lessee as being  reasonable.  The failure to specify herein any
particular  condition to Lessor's  consent shall not preclude the impositions by
Lessor at the time of consent of such  further or other  conditions  as are then
reasonable  with reference to the  particular  matter for which consent is being
given.

37. Guarantor.

      37.1 Form of Guaranty. If there are to be any Guarantors of this Lease per
Paragraph  1.11 the form of the  guaranty to be executed by each such  Guarantor
shall be In the form most  recently  published by the American  Industrial  Real
Estate  Association,  and each such Guarantor shall have the same obligations as
Lessee under this lease,  Including but not limited to the obligation to provide
the Tenancy Statement and Information required In Paragraph 16.

      37.2 Additional Obligations of Guarantor. It shall constitute a Default of
the  Lessee  under  this  Lease If any such  Guarantor  fails or  refuses,  upon
reasonable  request by Lessor to give:  (a) evidence of the due execution of the
guaranty called for by this Lease, Including the authority of the Guarantor (and
of the party signing on  Guarantor's  behalf) to obligate such Guarantor on said
guaranty,  and  resolution of Its board of directors  authorizing  the making of
such guaranty,  together with a certificate of incumbency  showing the signature
of  the  persons  authorized  to  sign  on its  behalf,  (b)  current  financial
statements  of Guarantor as may from time to time be requested by Lessor,  (c) a
Tenancy  Statement,  or (d) written  confirmation  that the guaranty is still In
effect.

38.  Quite  Possession.  Upon payment by Lessee of the rent for the Premises and
the  performance of all of the covenants,  conditions and provisions on Lessee's
part to be observed  and  performed  under this Lease,  Lessee  shall have quiet
possession  of the  Premises  for the entire term  hereof  subject to all of the
provisions of this Lease.

Initials:



<PAGE>


39. Optlons.

  39.1  Dentition.  As used In this Lease,  the word  "Option" has the following
  meaning: (A) the right to extend the term of this Lease or to renew this Lease
  or to extend or renew any lease that  Lessee has on other  property of Lessor;
  (b) the right of first  refusal  to lease the  Premises  or the right of first
  offer to lease the  Premises  or the  right of first  refusal  to lease  other
  property  of Lessor or the right of first  offer to lease  other  property  of
  Lessor; (c) the right to purchase the Premises,  or the right of first refusal
  to  purchase  the  Premises,  or the  right of first  offer  to  purchase  the
  Premises,  or the right to purchase other property of Lessor,  or the right of
  first  refusal to purchase  other  property  of Lessor,  or the right of first
  offer to purchase other property of Lessor.

      39.2 Options Personal 10 Original Lease.  Each Option granted to Lessee In
the Lease is personal to the original Lessee named In Paragraph 1.1 hereof,  and
cannot be  voluntarily or  involuntarily  assigned or exercised by any person or
entity other than said original  Lessee while the original Lessee Is In full and
actual  possession  of the  Premises  and without the  Intention  of  thereafter
assigning or subletting.  The Options,  If any, herein granted to Lessee are not
assignable,  either as a part of an  assignment  of this Lease or  separately or
apart  therefrom,  and no Option may be separated from this Lease In any manner,
by reservation or otherwise.

      39.3 Multiple  Options.  In the event that Lessee has any multiple options
to extend or renew the Lease,  a later  option  cannot be  exercised  unless the
prior Options to extend or renew this Lease have been validly exercised.

39.4 Effect of Default on Options.

             (a)   Lessee   shall   have  no  right  to   exercise   an  option,
notwithstanding any provision In the grant of option to the contrary: (1) during
the period  commencing  with the giving of any notice of Default under Paragraph
13.1 and continuing until the noticed Default Is cured, or (i) during the period
of time any monetary obligation due Lessor from Lessee is unpaid (without regard
to whether notice thereof is given Lessee), or (ii) during the time Lessee Is In
Breach of this tease,  or ~v) in the event that Lessor has given to Lessee three
(3) or more notices of separate  Defaults under Paragraph 13.1 during the twelve
(12) month period Immediately  preceding the exercise of the Option,  whether or
not the Defaults are cured.

             (b) The  period of time  within  which an Option  may be  exercised
shall not be extended or enlarged by reason of Lessee's inability to exercise an
option because of the provisions of Paragraph 39.4(a)

             (c) All rights of Lessee  under the  provisions  of an option shall
terminate and be of no further force or effect, notwithstanding Lessee's due and
timely  exercise of the Option,  If, after such  exercise and during the term of
this Lease, 0) Lessee fails to pay to Lessor a monetary obligation of Lessee for
a period of thirty  (30) days after such  obligation  becomes due  (without  any
necessity  of Lessor to give notice  thereof to Lessee),  or (i) Lessor gives to
Lessee  three (3) or more  notices of separate  defaults  under  Paragraph  13.1
during any twelve (12) month period,  whether or not the Defaults are cured,  or
(ii) If Lessee commits a Breach of this Lease.

40.  Rules and  Regulation  Lessee  agrees  that It will  abide by, and keep and
observe all reasonable  rules and regulations  (-Rules and  Regulations.)  which
Lessor  may  make  from  time to time  for the  management,  safety,  care,  and
cleanliness  of the  grounds,  the parking  and  unloading  of vehicles  and the
preservation of good order, as well as for the convenience of other occupants or
tenants of the Building and the Industrial Center and their invitees.

4t. Security  Measures.  Lessee hereby  acknowledges  that the rental payable to
Lessor  hereunder  does not Include the cost of guard service or other  security
measures,  and that Lessor shall have no obligation  whatsoever to provide same.
Lessee assumes all responsibility for the protection of the Premises Lessee, Its
agents and Invitees and their property from the acts of third parties.

42.  Reservations.  Lessor  reserves  the  right,  from time to time,  to grant,
without the consent or joinder of Lessee, such easements, rights of way, utility
raceways,  and  dedications  that  Lessor  deems  necessary,  and to  cause  the
recordation of parcel maps and restrictions,  so long as such easements,  rights
of way, utility raceways,  dedications,  maps and restrictions do not reasonably
Interfere  with the use of the  Premises  by Lessee.  Lessee  agrees to sign any
documents reasonably requested by Lessor to effectuate any such easement rights,
dedication, map or restriction.

43.  Performance  Under Protest.  If at any time a dispute shall arise as to any
amount or sum of money to be paid by one Party to the other under the provisions
hereof, the Party against whom the obligation to pay the money Is asserted shall
have the right to make payment  under  protest.  and such  payment  shall not be
regarded as a voluntary payment and there shall survive the right on the part of
said Party to  Institute  suit for recovery of such sum. If It shall be adjudged
that there was no legal  obligation on the part of said Party to pay such sum or
any part  thereof,  said Party shall be entitled to recover  such sum or so much
thereof  as It was not  legally  required  to pay under the  provisions  of this
Lease.

44.  Authority.  If either Party hereto Is a corporation,  trust,  or general or
limited  partnership,  each  individual  executing  this Lease on behalf of such
entity  represents and warrants that he or she Is duly authorized to execute and
deliver  this  Lease  on its  behalf.  If  Lessee  Is a  corporation,  trust  or
partnership,  Lessee  shall,  within  thirty (30) days after  request by Lessor,
deliver to Lessor evidence satisfactory to Lessor of such authority.

45. Conflict.  Any conflict between the printed provisions of this Lease and the
typewritten or handwritten  provisions shall be controlled by the typewritten or
handwritten provisions.

46.  Offer.  Preparation  of this Lease by either  Lessor or Lessee or  Lessor's
agent or Lessee's  agent and submission of same to Lessee or Lessor shall not be
deemed  an offer to  lease.  This  Lease is not  Intended  to be  binding  until
executed and delivered by all Parties hereto.

47. Amendment. This Lease may be modified only in writing, signed by the parties
In interest at the time of the modification.  The Parties shall amend this Lease
from time to time to reflect any  adjustments  that are made to the Base Rent or
other rant payable under this Lease.  AB long as they do not  materially  change
Lessee's   obligations   hereunder,   Lessee  agrees  to  make  such  reasonable
non-monetary  modifications  to this Lease as may be  reasonably  required by an
Institutional  Insurance  company or pension plan Lender In connection  with the
obtaining  of normal  financing  or  refinancing  of the  property  of which the
Premises are a part.

48. Multiple  Parties.  Except as otherwise  expressly  provided herein, If more
than one  person or entity is named  herein  as  either  Lessor or  Lessee,  the
obligation   of  such   multiple   parties   shall  be  the  joint  and  several
responsibility of all persons or entitles named herein as such Lessor or Lessee.

Initials:


<PAGE>


         ADDENDUM TO STANDARD INDUSTRIAL/COMMERCIAL MULTI-TENANT LEASE -
       MODIFIED NET DATED AUGUST 1996 BY AND BETWEEN EBJ PARTNERS, L.P., A
         CALIFORNIA LIMITED PARTNERSHIP AS ~LESSOR. AND ORYX TECHNOLOGY
         CORPORATION AND SURGX CORPORATION AS "LESSEE" FOR THE PREMISES
            COMMONLY KNOWN AS 1100 AUBURN STREET, FREMONT, CALIFORNIA

49. CONTINGENT UPON TERMINATION OF EXISTING LEASE: This Lease is contingent upon
the early  termination  of the lease  dated  June 2, 1994 with  Concept  Systems
Design, Inc. on terms acceptable to Lessor and Lessor's counsel.

50.  REFER TO LEASE  AGREEMENT.  PARAGRAPH  1.4  [EARLY  POSSESSION1:  The Early
Possession  date shall commence upon the  occurrence of Lessor's  receipt of the
following:  (i) a fully  executed  Lease,  (ii) all required  deposits under the
Lease, and (iii) Lessee's  liability  insurance  endorsement naming Lessor as an
additional  insured party.  Additionally,  Lessee will change all utilities into
Lessee's name as of the Early Possession Date.

51. BASE RENT  SCHEDULE:  The following  monthly Base Rent Schedule  shall apply
during the term of this Lease:

Months 01 - 30: $18,151.20
Months 31 - 60: $19,285.65

52. TENANT IMPROVEMENTS BY LESSOR:  Prior to the Lease Commencement Date, Lessor
shall, at Lessor's sole cost and expense:

A. Professionally shampoo and clean all carpets.

B. Repaint or touch-up interior office walls as needed as agreed

by Lessor and Lessee during inspection.

C. Professionally clean and wax all VCT tile.

53. LOADING DOCK:  Lessee  acknowledges that the loading dock to the rear of the
Premises is common to the entire  building and Lessee  agrees to cooperate  with
other  Lessee's  of the  building  regarding  the use of the loading  dock.  The
loading dock may not be used by persons and/or entities which are not tenants of
the building.

54. HVAC  MAINTENANCE:  Lessor will contract for the HVAC quarterly  maintenance
and will pass  through the  expenses  and any repairs to Lessee as an  operating
expense.

55. OPERATING EXPENSES: Lessor estimates that the 1996/97 Operating Expenses are
approximately  $.13 per square foot per month and Lessee  agrees to pay Lessee's
pro rate share of  Operating  Expenses  monthly as  provided  herein  commencing
September 1, 1996.  Lessee's share of Operating  Expenses shall be $2,949.57 per
month  commencing  on September 1, 1996 which shall be payable in advance on the
first day of each and every month. Lessor shall guarantee that Lessee's pro rata
share of  Operating  Expenses  shall not exceed  $.13 per square  foot per month
through  December 31, 1997.  The  Operating  Expenses  shall be  determined on a
calendar year basis in a detailed statement of the actual expenses, and shall be
delivered to Lessee  within  ninety (90) days after  expiration of each calendar
year as set forth in the Lease.

56.  OPTION TO EXTENT):  Provided  that Lessee has not been in default of any of
the provisions of this Lease during the then current term, Lessee shall have the
right to extend the initial term hereof for one (1)  additional  period of three
(3) years upon the same terms and  conditions as stated  herein,  except for the
Minimum  Monthly  Rent.  Such  extension is herein  referred to as the "Extended
Term".  Lessee must exercise its right, if at all, by written  notification (the
"Notice of Exercise-) to Lessor not less than twelve (12) months,  nor more than
fifteen (15) months prior to the expiration of the initial term hereof.

                   The  option  to extend  granted  herein  is  personal  to the
original  Lessee  executing this Lease and is not assignable or  transferable by
such original  Lessee.  Lessor grants the rights  contained  herein to Lessee in
consideration  of  Lessee's  strict  compliance  with  the  provisions   hereof,
including, without limitation, the manner of exercise of this option.

                   If Lessee  exercises  the  right to extend  the term then the
Minimum  Monthly  Rent shall be adjusted  to equal the Fair  Market  Rental (the
~Newly  Established  Base  Rent.)  for  the  premises  as of  the  date  of  the
commencement of such Extended Term,  pursuant to the procedures  hereinafter set
forth.  The term ~Fair Market Rental.  means the Minimum Monthly Rent chargeable
for the Premises based upon the following factors  applicable to the Premises or
any comparable premises:

A. Rental rates being charged for comparable  premises in the same  geographical
location.

B. The relative locations of the comparable premises.

C. Yearly rental adjustments

D. Services and utilities provided or to be provided.

E. Any other relevant Lease terms or conditions.

                   In no event.  however.  shall the Newly Established Base Rent
be less  than  the  Minimum  Monthly  Rent in  effect  immediately  prior to the
commencement  date of the Extended Term. The Fair Market Rental evaluation shall
include  provision for yearly rent adjustments  during the Extended Term if such
adjustments are common in the market place similar types of leases.

Upon exercise of the right to extend the term, and included within the Notice of
Exercise,  Lessee  shall notify  Lessor of its opinion of Fair Market  Rental as
above  defined for the Extended  Term. If the parties are unable to agree upon a
Minimal  Monthly  Rent for the  Extended  Term  within  thirty  (30) days  after
exercise  of the  right to  extend  the term,  within  ten (10)  days  after the
expiration  thereof,  either  party at its own cost and  expense  and by  giving
notice to the other  party in writing,  may appoint a MAI real estate  appraiser
(.Qualified  Appraiser.) to set the Minimum  Monthly Rent for the Extended Term.
The terms  ~Minimum  Monthly  Rent.  and "Fair  Market  Rental"  as used in this
paragraph shall be interchangeable.

                   If a party does not appoint a Qualified  Appraiser within ten
(10) days after the first  party has given  notice of the name of its  Qualified
Appraiser,  the single Qualified Appraiser appointed shall be the sole appraiser
and shall set the Fair Market Rent for the Extended Term.

                   If two  Qualified  Appraisers  are  appointed by the parties,
they shall meet promptly,  on ten (10) days' notice to the parties, to take such
evidence and other  information as the parties may deem  reasonable to submit to
the  Qualified  Appraisers.  Within  thirty (30) days after the selection of the
last of the  two  Qualified  Appraisers  to be  appointed  by the  parties,  the
Qualified  Appraisers  shall render their  opinions of the Fair Market Rental of
the premises as above  qualified.  If the two valuations are within five percent
(5%) of each other  (using the lower  valuation as the basis for  computing  the
5%),  they shall be  averaged  and the  average of the two shall be the  Minimum
Monthly Rent for the Extended  Term. If only one  appraisal is timely  submitted
that appraisal shall constitute the Minimum Monthly Rent for the Extended Term.

                   If the two valuations are separated by more than five percent
(5%), then the two Qualified  Appraisers  shall,  within ten (10) days following
the last  date for  submission  of the two  appraisals  of Fair  Market  Rental,
appoint a third  Qualified  Appraiser.  If they are unable to agree upon a third
Qualified  Appraiser  within such ten (10) day period,  either of the parties to
this  Lease,  by giving  five (5) days'  notice to the other  party,  may demand
arbitration as specified below. If neither party applies for Arbitration  within
the ten (10) day period herein  specified,  the two appraisals of value shall be
averaged as stated above.

                   In the event the parties are unable to mutually  agree upon a
Minimum  Monthly Rent for the Extended  Term,  and in such event  proceed to the
Appraisal or  Arbitration  procedures  herein  specified,  both parties shall be
bound to submit the matter for such  determination.  The procedure  specified in
this paragraph for appointment of Qualified Appraisers,  delivery of appraisals,
appointment of an Arbitrator, and determination of Fair Market Value thereby, is
herein  collectively  referred to as  ~Arbitration..  The  Arbitration  shall be
conducted and determined in the County where the Leased Premises are situated.

If the  Arbitration is not concluded  before  commencement of the Extended Term,
Lessee  shall pay Minimum  Monthly Rent to Lessor in an amount equal to the Fair
Market Rental set forth in the appraisal by Lessor's  Qualified  Appraiser until
the Fair  Market  Rental  is  determined  in  accordance  with  the  arbitration
provisions  hereof.  If the Fair  Market  Rental as  determined  by  Arbitration
differs from that stated by Lessor's  Qualified  Appraiser,  then any adjustment
required  to  correct  the  amount  previously  paid by Lessee  shall be made by
payment by the appropriate party within thirty (30) days after the determination
of Fair Market Rental by Arbitration  has been  concluded,  as provided  herein.
Lessee shall be obligated to make payment during the entire Extended Term of the
Minimum Monthly Rent  determined in accordance  with the Arbitration  procedures
hereunder.

                   A party demanding Arbitration hereunder shall make its demand
in writing (-Demand  Notice.) within ten (10) days after delivery of the last of
the two appraisals  presented by the Qualified  Appraisers as specified above. A
copy of the  Demand  Notice  shall be sent to the local  office of the  American
Arbitration  Association,  or any successor  thereto,  for the appointment of an
arbitrator  satisfactory  to both  parties  to render a final  determination  as
hereinafter  provided.  If agreement regarding selection of an arbitrator is not
reached within ten (10) days,  then a copy of the Demand Notice shall be sent to
the  Presiding  Judge of the highest trial court in such county for the state in
which the premises are located.  The Presiding Judge is hereinafter  referred to
as the ~Appointer-.  The Appointer shall appoint within ten (10) days thereafter
a Arbitrator.  The Arbitrator  shall be qualified to serve as an expert witness,
over objection,  to give opinion testimony  addressed to the issue in a court of
competent jurisdiction.

                   As  used  herein,  the  term  Arbitrator  refers  to a  third
Qualified  Appraiser,  selected by any of the methods  heretofore set forth. The
Arbitrator  shall,  within  ninety  (90) days  after his  appointment,  state in
writing his  determination of the Fair Market Rental.  The Arbitrator shall have
the right to consult experts and competent  authorities with factual information
or evidence  pertaining to a determination  of Fair Market Rental,  but any such
consultation  shall be made in the  presence of both  parties with full right to
cross examine.  If the  Arbitrator's  determination  of Fair Market Rental is an
amount which falls between the respective values stated by Lessor's and Lessee's
Qualified  Appraisers,  the value of the Qualified Appraiser which is closest to
that of the  Arbitrator  shall be averaged with that of the  Arbitrator  and the
resultant  amount shall be the Fair Market Rental for the Extended  Term. If the
Arbitrator's  valuation is exactly between that of the two Qualified Appraisers,
the  Arbitrator's  valuation  shall be the Fair Market  Rental for the  Extended
Term. If, however,  the Arbitrator's  valuation is either higher than the higher
valuation  posed  by the two  Qualified  Appraisers  or  lower  than  the  lower
valuation of the two Qualified  Appraisers,  then the valuation of the Qualified
Appraiser  which is closest to that of the  Arbitrator  shall be the Fair Market
Rental for the Extended  Term.  The Fair Market  Rental so  determined  shall be
subject  to  increase  both  as to  manner  and  time(s)  as  determined  by the
Arbitrator,  based on then prevailing  market  conditions.  The Arbitrator shall
render a decision and award in writing,  with counterpart  copies to each party.
Judgment may be entered thereon in any court of competent jurisdiction.

                   In  the  event  of  failure,  refusal,  or  inability  of the
Arbitrator to act in a timely manner, a successor shall be appointed in the same
manner as such Arbitrator was first chosen  hereunder.  The fees and expenses of
the Arbitrator and for the administrative  hearing fee, if any, shall be divided
equally  between the parties.  Each party shall bear its own attorneys' fees and
other expenses  including fees of witness in presenting  evidence,  and the fees
and cost of its own Qualified Appraiser.


57.  CONDITION UPON  TERMINATION:  Upon termination or expiration of this Lease,
Lessee  shall  surrender  the  premises  to Lessor,  broom clean and in the same
condition as received,  except for ordinary wear and tear.  For purposes of this
Lease,  items which are not ~ordinary wear and tear.  shall include,  but not be
limited to, the  following  items,  which shall be the  Lessee's  obligation  to
repair or  correct:  (i) damage to or  defacement  of  partitions,  woodwork  or
plaster  or any  portion  of the  Premises  from any cause  (including,  without
limitation,  from nails or screws);  (ii) soiled carpet or woodwork  through the
over-watering  of plants or other  misuse;  (iii)  defacement  to the  warehouse
floor:  (iv)  damage  to the  Premises  not  caused by the  passage  of time and
ordinary  use; (v)  excessive  wear to carpeting  from  Lessee's  failure to use
carpet protectors under desk chairs; and (vi) any disrepair in the Premises that
is capable of being repaired and which is Lessee's obligation to repair pursuant
to the Lease (for  example,  light  fixtures,  door  knobs,  ceiling  panels and
interior walls.)


                         [Signatures on Following Pages]



<PAGE>








READ AND APPROVED:

LESSEE: ORYX TECHNOLOGY CORPORATION

By: /s/ Andrew Wilson

By:

LESSEE: SURGX CORPORATION
By: /s/ Andrew Wilson

By:

LESSOR: EBJ PARTNERS L.P.
                 A CALIFORNIA Limited PARTNERSHIP

By: SEE ATTACHED EXHIBIT "B"


                                                       EXHIBIT "A"

LESSOR:  EBJ PARTNERS, L.P., A CALIFORNIA LIMITED PARTNERSHIP

By: RICHARD LEVIN
RICHARD LEVIN,  GENERAL PARTNER

By:  /s/ ALAN J.LEVIN
       ALAN J. LEVEN, his Co-Attorney In Fact

 By:  /s/ SYDNEY LEVIN
        SYDNEY LEVIN, his Co-Attorney In Fact

            UNDER DURABLE ATTORNEY POWER OF ATTORNEY
            EXECUTED DECEMBER 4, 1991

 By: EMILY LEVIN
        EMILY LEVIN, GENERAL PARTNER

         By:  /s/ ALAN J. LEVIN
                ALAN J. LEVIN, her Co-Attorney In Fact

         By:  /s/ SYDNEY LEVIN
               SYDNEY LEVIN, her Co-Attorney In Fact


 UNDER DURABLE POWER OF ATTORNEY
 EXECUTED FEBRUARY 17, 1992



<PAGE>







                                                       EXHIBIT "B"

LESSOR:  EBJ PARTNERS, L.P., A CALIFORNIA LIMITED PARTNERSHIP

By: RICHARD LEVIN
RICHARD LEVIN,  GENERAL PARTNER

By:  /s/ ALAN J.LEVIN
       ALAN J. LEVEN, his Co-Attorney In Fact

 By:  /s/ SYDNEY LEVIN
        SYDNEY LEVIN, his Co-Attorney In Fact

            UNDER DURABLE ATTORNEY POWER OF ATTORNEY
            EXECUTED DECEMBER 4, 1991

 By: EMILY LEVIN
        EMILY LEVIN, GENERAL PARTNER

         By:  /s/ ALAN J. LEVIN
                ALAN J. LEVIN, her Co-Attorney In Fact

         By:  /s/ SYDNEY LEVIN
               SYDNEY LEVIN, her Co-Attorney In Fact


 UNDER DURABLE POWER OF ATTORNEY
 EXECUTED FEBRUARY 17, 1992



<PAGE>











ADDENDUM II TO STANDARD INDUSTRIAL/COMMERICAL  MULTI-TENANT LEASE - MODIFtED NET
DATISD  AUGUST 1996 BY AND  BETWEEN  EBJ  PARTNERS,  L.P.,  A CALIFORMA  LIMITED
PARTNERSHIP  ("LESSOR") ~`{D ORYX TECHNOLOGY  CORPORATION AND SURGX  CORPORATION
("LESSEE")  FOR THE  PREMISES  COMMONLY  KNOWN AS 1lOO AUBURN  STREET,  FREMONT,
CALIFORNIA

58. Tenant  Improvement by Lessor: In addition to Addendum ~ Paragraph S2, prior
    to Lease Commencement Date. Lessor shall, at Lessor's 501e cost and expense:

A. Replace cracked or damaged VCT tiles as needed.

B. Clean and punt building' exterior wall' &s indicated on Exhibit "C"

C.  Retexture  and repaint  planter box, as shown on Exhibit ~C".  Additionally,
    existing  plants  shall be removed and  replaced  with new plants to be 
    mutually acceptable by Lessor and Lessee.

59.   Early  Possession;  Lessee's  early  possession as described in Addendum I
      Paragraph 50 shall be free from base rent and CAM charge.

60.  Operating  Expenses:  In addition to  Addendum I  Paragraph  S5,  operating
     expense increases shall not exceed 1S% annually.

61.   Signage: Lessee shall have the right to use one-half (1/2) of the existing
      monument  sign.  Lessee will initially use the entire sign until such time
      that the Tenant at 1120 Auburn  Street opts to use their one half (l/2) of
      the existing monument sign, at which time Lessee shall reduce their use of
      the sign to one-half (1/2).

62.   Hazardous  Materials:  Lessee  shall have no  obligation  to clean up., to
      comply with any law regulating,  or to reimburse,  release,  indemnify, or
      defend  lessor  with  respect to any  hazardous  materials  or waste which
      Lessee did not store, dispose, or transport in, use, or cause to be on the
      Premises  in  violation  of  applicable  law.  However,  Lessee  shall  be
      obligated to clean up. to comply with any law regarding,  or to reimburse,
      release,  indemnify  or  defend  Lessor  with  respect  to  any  hazardous
      materials or waste which Lessee, its agents, or future subtenants, if any,
      does store,  dispose,  or transport in, use or cause to be on the Premises
      in violation of applicable  law.  Lessee also agrees not to use or dispose
      of any toxic waste or hazardous  materials on the premises  without  first
      obtaining  Lessor's  consent.  In the event  consent is granted by Lessor,
      Lessee agrees to complete  compliance with governmental  regulations,  and
      Lessee also  agrees to install  such toxic  waste or  hazardous  materials
      monitoring device as Lessor deems necessary.

63. ADA  Compliance:  Paragreph  2.3  shall  also  apply to the  Americans  with
    Disabilites Act ("ADA")

64. Assignment and Subletting:

64.1 Paragraph  12.1 (b) of Lease  shall be changed  from 2S % or more of voting
     control to 50% or more of voting control.

64.2 Paragraph  12.2 (c) shall be changed from "... a non-refundable  deposit of
     S1,000..." to "...a non-refundable deposit of $500...".



<PAGE>


65. Holding  Over:  Paragraph 26 shall be changed from "...two  hundred  percent
    (200%) of the base rent" to "...one hundred fifty percent (150%) of the base
    rent".

66. Additional  Security Deposit:  Upon execution of the Lease, Lessee shall pay
    to Lessor a sum equal to two  month's  rent  (S36,302.40)  as an  additional
    security  deposit and shall be refundable to Tenant upon  fulfillment of all
    terms and conditions of the Lease after twelve (12) months.  This additional
    security deposit shall bear interest at five percent (5%) if Tenant fulfills
    all terms and conditions of Lease during the first twelve (12) months.


Read and Approved:

 Lessee: ORYX TECHNOLOGY CORPORATION             Lessor: EBJ PARTNERS, L.P.,
                                                 A CALFORNIA LIMIT PARTNERSIflP

 By: /s/ Andrew Wilson                           By:   See attached Exhibit "B1"

 Date:  8/15/96                                  Date:

Lessee: SURGX CORPORATION

By:  /s/ Andrew Wilson

Date:  8/15/96