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                                                                  Exhibit 10.32

                                                            [Florida NET LEASE]

                                LEASE AGREEMENT

      THIS LEASE AGREEMENT IS MADE THIS 15 day of - June 1999, between ProLogis
Limited Partnership TV, a Delaware Limited Partnership By: ProLogis IV, Inc. a
Delaware Corporation, as the General Partner ("Landlord"), and the Tenant named
below.

TENANT:                  STERILE RECOVERIES, INC,
TENANT'S REPRESENTATIVE, Mr. WAYNE PETERSON, EXECUTIVE VICE PRESIDENT
ADDRESS, AND phone no.:  28100 U.S. HIGHWAY 19. SUITE 201
                         CLEARWATER. FLORIDA 33761
                         (727) 726-4421 / FAX (727) 725-8037

Premises:                That portion of the Building, containing approximately
                         40,800 rentable square feet, as determined by Landlord,
                         as shown on Exhibit A.

Project:                 PLANT CITY DISTRIBUTION CENTER #1 (40,800 SF)

BUILDING:                1802 CORPORATE CENTER LANE. PLANT CITY. FLORIDA 33567

TENANT'S PROPORTIONATE
SHARE

or Project:              100%

TENANT'S PROPORTIONATE
SHARE                    100%

of Building:

Lease Term:              Beginning on the Commencement Date and ending on the
                         last day of the 63rd FULL calendar month thereafter.

<TABLE>
<CAPTION>

<S>                                <C>                         <C>                           <C>
Commencement Date:                 AUGUST 1, 1999

Initial Monthly Base Rent:                                                                   $ 11,492.00

* SEE ADDENDUM ONE, SECTION I
  INITIAL ESTIMATED MONTHLY        1. Utilities:               $   0.00
  OPERATING EXPENSE PAYMENTS:
  (estimates only and subject to   2. Common Area Charges:     $ TENANT'S RESPONSIBILITY
  adjustment to actual costs and
  expenses according to the
  provisions of this Lease)        3. Taxes:                   $ TO BE PAID DIRECTLY BY
                                                                 TENANT ON AN ANNUAL
                                                                 BASIS.

                                   4. Insurance:               $  119.00

                                   5. Others:                  $   0.00

  INITIAL ESTIMATED MONTHLY OPERATING EXPENSE PAYMENTS:                                      $    119.00

  INITIAL MONTHLY SALES TAX:                                                                 $    783.74

  INITIAL MONTHLY BASE RENT, OPERATING EXPENSE, and

  Sales Tax Payments:                                                                        $ 12,394.74

  SECURITY Deposit:                 $12,394.74*
  1 *SEE Addendum One, Section X

  Broker:                           CB Richard Ellis
</TABLE>

Addenda: EXHIBIT A, EXHIBIT B. ADDENDUM ONE, ADDENDUM TWO, ADDENDUM THREE,
         ADDENDUM 4, ADDENDUM 5, ADDENDUM 6, AND ADDENDUM SEVEN, ADDENDUM
         FOUR, ADDENDUM FIVE, ADDENDUM SIX, AND ADDENDUM SEVEN

      1. GRANTING CLAUSE. IN CONSIDERATION OF THE OBLIGATION OF TENANT TO PAY
RENT AS HEREIN PROVIDED AND IN CONSIDERATION OF THE OTHER TERMS, COVENANTS, AND
CONDITIONS HEREOF, LANDLORD LEASES TO TENANT, AND TENANT TAKES FROM LANDLORD,
THE PREMISES, TO HAVE AND TO HOLD FOR THE LEASE TERM, SUBJECT TO THE TERMS,
COVENANTS AND CONDITIONS OF THIS LEASE.

      2. ACCEPTANCE or PREMISES. TENANT SHALL ACCEPT THE PREMISES IN ITS
CONDITION AS OF THE COMMENCEMENT DATE, SUBJECT TO ALL APPLICABLE LAWS,
ORDINANCES, REGULATIONS, COVENANTS AND RESTRICTIONS. LANDLORD HAS MADE NO
REPRESENTATION OR WARRANTY AS TO THE SUITABILITY OF THE PREMISES FOR THE
CONDUCT OF TENANT'S BUSINESS, AND TENANT WAIVES ANY IMPLIED WARRANTY THAT THE
PREMISES ARE SUITABLE FOR TENANT'S INTENDED PURPOSES. EXCEPT AS PROVIDED IN
PARAGRAPH 10, IN NO EVENT SHALL LANDLORD HAVE ANY OBLIGATION FOR ANY DEFECTS IN
THE PREMISES OR ANY LIMITATION ON ITS USE. THE TAKING OF POSSESSION OF THE
PREMISES SHALL BE CONCLUSIVE EVIDENCE THAT TENANT ACCEPTS THE PREMISES AND THAT
THE PREMISES WERE IN GOOD CONDITION AT THE TIME POSSESSION WAS TAKEN EXCEPT FOR
ITEMS THAT ARE LANDLORD'S RESPONSIBILITY UNDER PARAGRAPH 10 AND ANY PUNCHLIST
ITEMS AGREED TO IN WRITING BY LANDLORD AND TENANT.




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      3. Use. The Premises shall be used only for the purpose of receiving,
storing, shipping and selling (but limited to wholesale sales) products,
materials and merchandise made and/or distributed by Tenant and for such other
lawful purposes as may be incidental thereto; Tenant may also use the Premises
for light manufacturing. Tenant shall not conduct or give notice of any
auction, liquidation, or going out of business sale on the Premises. Tenant
will use the Premises in a careful, safe and proper manner and will not commit
waste, overload the floor or structure of the Premises or subject the Premises
to use that would damage the Premises. Tenant shall not permit any
objectionable or unpleasant odors, smoke, dust, gas, noise, or vibrations to
emanate from the Premises, or take any other action that would constitute a
nuisance or would disturb, unreasonably interfere with, or endanger Landlord or
any tenants of the Project. Outside storage, including without limitation,
storage of trucks and other vehicles, is prohibited without Landlord's prior
written consent. Tenant, at its sole expense, shall use and occupy the Premises
in compliance with all laws, including, without limitation, the

      Americans With Disabilities Act, orders, judgments, ordinances,
regulations, codes, directives, permits, licenses, covenants and restrictions
now or hereafter applicable to the Premises (collectively, "Legal
Requirements"). ' The Premises shall not be used as a place of public
accommodation under the Americans With Disabilities Act or similar state
statutes or local ordinances or any regulations promulgated thereunder, all as
may be amended from time to time. Tenant shall, at its expense, make any
alterations or modifications, within or without the Premises, that are required
by Legal Requirements related to Tenant's use or occupation of the Premises.
Tenant will not use or permit the Premises to be used for any purpose or in any
manner that would void Tenant's or Landlord's insurance, increase the insurance
risk, or cause the disallowance of any sprinkler credits. If any increase in
the cost of any insurance on the Premises or the Project is caused by Tenant's
use or occupation of the Premises, or because Tenant vacates the Premises, then
Tenant shall pay the amount of such increase to Landlord. Any occupation of the
Premises by Tenant prior to the Commencement Date shall be subject to all
obligations of Tenant under this Lease.

      4. Base Rent. Tenant shall pay Base Rent in the amount set forth above.
The first month's Base Rent, and the first monthly installment of estimated
Operating Expenses (as hereafter defined) shall be due and payable on the date
hereof, and Tenant promises to pay to Landlord in advance, without demand,
deduction or set-off, monthly installments of Base Rent on or before the first
day of each calendar month succeeding the Commencement Date. Payments of Base
Rent for any fractional calendar month shall be prorated. All payments required
to be made by Tenant to Landlord hereunder shall be payable at such address as
Landlord may specify from time to time by written notice delivered in
accordance herewith. The obligation of Tenant to pay Base Rent and other sums
to Landlord and the obligations of Landlord under this Lease are independent
obligations. Tenant shall have no right at any time to abate, reduce, or
set-off any rent due hereunder except as may be expressly provided in this
Lease. If Tenant is delinquent in any monthly installment of Base Rent or of
estimated Operating Expenses for more than 5 days, Tenant shall pay to Landlord
on demand a late charge equal to 5 percent of such delinquent sum. The
provision for such late charge shall be in addition to all of Landlord's other
rights and remedies hereunder or at law and shall not be construed as a
penalty.

      5. SECURITY DEPOSIT. The Security Deposit shall be held by Landlord as
security for the performance of Tenant's obligations under this Lease. The
Security Deposit is not an advance rental deposit or a measure of Landlord's
damages in case of Tenant's default. Upon each occurrence of an Event of
Default (hereinafter defined), Landlord may use all or part of the Security
Deposit to pay delinquent payments due under this Lease, and the cost of any
damage, injury, expense or liability caused by such Event of Default, without
prejudice to any other remedy provided herein or provided by law. Tenant shall
pay Landlord on demand the amount that will restore the Security Deposit to its
original amount. Landlord's obligation respecting the Security Deposit is that
of a debtor, not a trustee; no interest shall accrue thereon. The Security
Deposit shall be the property of Landlord, but shall be paid to Tenant when
Tenant's obligations under this Lease have been completely fulfilled. Landlord
shall be released from any obligation with respect to the Security Deposit upon
transfer of this Lease and the Premises to a person or entity assuming
Landlord's obligations under this Paragraph 5.

      6. OPERATING EXPENSE PAYMENTS. During each month of the Lease Term, on
the same date that Base Rent is due, Tenant shall pay Landlord an amount equal
to 1/12 of the annual cost, as estimated by Landlord from time to time, of
Tenant's Proportionate Share (hereinafter defined) of Operating Expenses for
the Project. Payments thereof for any fractional calendar month shall be
prorated. The term "Operating Expenses" means all costs and expenses incurred
by Landlord with respect to the ownership, maintenance, and operation of the
Project including, but not limited to costs of: Taxes (hereinafter defined) and
fees payable to tax consultants and attorneys for consultation and contesting
taxes; insurance; utilities; maintenance, repair and replacement of all
portions of the Project, including without limitation, paving and parking
areas, roads, roofs, alleys, and driveways, mowing, landscaping, exterior
painting, utility lines, heating, ventilation and air conditioning systems,
lighting, electrical systems and other mechanical and building systems; amounts
paid to contractors and subcontractors for work or services performed in
connection with any of the foregoing; charges or assessments of any association
to which the Project is subject; property management fees payable to a property
manager, including any affiliate of Landlord, or if there is no property
manager, an administration fee not to exceed 15 percent of Operating Expenses
payable to Landlord; security services, if any; trash collection, sweeping and
removal; and additions or alterations made by Landlord to the Project or the
Building in order to comply with Legal Requirements (other than those expressly
required herein to be made by Tenant) or that are appropriate to the continued
operation of the Project or the Building as a bulk warehouse facility in the
market area, provided that the cost of additions or alterations that are
required to be capitalized for federal income tax purposes shall be amortized
on a straight line basis over a period equal to the lesser of the useful life
thereof for federal income tax purposes or 10 years. Operating Expenses do not
include costs, or expenses, depreciation or amortization for capital repairs
and capital replacements required to be made by Landlord under Paragraph 10 of
this Lease, debt service under mortgages or ground rent under ground leases,
costs of




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restoration to the extent of net insurance proceeds received by Landlord with
respect thereto, leasing commissions, or the costs of renovating space for
tenants. *See Addendum One, Section III.

      If Tenant's total payments of Operating Expenses for any year are less
than Tenant's Proportionate Share of actual Operating Expenses for such year,
then Tenant shall pay the difference to Landlord within 30 days after demand,
and if more, then Landlord shall retain such excess and credit it against
Tenant's next payments. For purposes of calculating Tenant's Proportionate
Share of Operating Expenses, a year shall mean a calendar year except the first
year, which shall begin on the Commencement Date, and the last year, which
shall end on the expiration of this Lease. With respect to Operating Expenses
which Landlord allocates to the entire Project, Tenant's "Proportionate Share"
shall be the percentage set forth on the first page of this Lease as Tenant's
Proportionate Share of the Project as reasonably adjusted by Landlord in the
future for changes in the physical size of the Premises or the Project; and,
with respect to Operating Expenses which Landlord allocates only to the
Building. Tenant's "Proportionate Share" shall be the percentage set forth on
the first page of this Lease as Tenant's Proportionate Share of the Building as
reasonably adjusted by Landlord in the future for changes in the physical size
of the Premises or the Building. Landlord may equitably increase Tenant's
Proportionate Share for any item of expense or cost reimbursable by Tenant that
relates to a repair, replacement, or service that benefits only the Premises or
only a portion of the Project or Building that includes the Premises or that
varies with occupancy or use. The estimated Operating Expenses for the Premises
set forth on the first page of this Lease are only estimates, and Landlord
makes no guaranty Or warranty that such estimates will be accurate.

      7. UTILITIES. Tenant shall pay for all water, gas, electricity, heat,
light, power, telephone, sewer, sprinkler services, refuse and trash
collection, and other utilities and services used on the Premises, all
maintenance charges for utilities, and any storm sewer charges or other similar
charges for utilities imposed by any governmental entity or utility provider,
together with any taxes, penalties, surcharges or the like pertaining to
Tenant's use of the Premises. Landlord may cause at Tenant's expense any
utilities to be separately metered or charged directly to Tenant by the
provider. Tenant shall pay its share of all charges for jointly metered
utilities based upon consumption, as reasonably determined by Landlord. No
interruption or failure of utilities shall result in the termination of this
Lease or the abatement of rent. Tenant agrees to limit use of water and sewer
for normal restroom use.

      8. Taxes." Tenant shall pay all taxes, assessments and governmental
charges (collectively referred to as "Taxes") that accrue against the Project
during the Lease Term. If Tenant fails to pay such Taxes, Landlord may pay such
Taxes and be reimbursed by Tenant upon demand, and such non-payment of Taxes by
Tenant shall constitute an Event of Default under this Lease. Landlord may
contest by appropriate legal proceedings the amount, validity, or application
of any, Taxes or liens thereof. Tenant can request of Landlord, in writing, to
contest Taxes, in which case, Landlord will do so, but Tenant will be
responsible to reimburse Landlord upon demand for the costs incurred in
contesting such Taxes. All capital levies or other taxes assessed or imposed on
Landlord upon the rents payable to Landlord under this Lease and any franchise
tax, any excise, transaction, sales or privilege tax, assessment, levy or
charge measured by or based, in whole or in part, upon such rents from the
Premises and/or the Project or any portion thereof shall be paid by Tenant to
Landlord monthly in estimated installments or upon demand, at the option of
Landlord, as additional rent; provided, however, in no event shall Tenant be
liable for any net income taxes imposed on Landlord unless such net income
taxes are in substitution for any Taxes payable hereunder. If any such tax or
excise is levied or assessed directly against Tenant, then Tenant shall be
responsible for and shall pay the same at such times and in such manner as the
taxing authority shall require. Tenant shall be liable for all taxes levied or
assessed against any personal property or fixtures placed in the Premises,
whether levied or assessed against Landlord or Tenant.

      9. INSURANCE. Landlord shall maintain all risk property insurance
covering the full replacement cost of the Building. Landlord may, but is not
obligated to, maintain such other insurance and additional coverages as it may
deem necessary, including, but not limited to, commercial liability insurance
and rent loss insurance. All such insurance shall be included as part of the
Operating Expenses charged to Tenant. The Project or Building may be included
in a blanket policy (in which case the cost of such insurance allocable to the
Project or Building will be determined by Landlord based upon the insurer's
cost calculations). Tenant shall also reimburse Landlord for any increased
premiums or additional insurance which Landlord reasonably deems necessary as a
result of Tenant's use of the Premises.

      Tenant, at its expense, shall maintain during the Lease Term: all risk
property insurance covering the full replacement cost of all property and
improvements installed or placed in the Premises by Tenant at Tenant's expense;
worker's compensation insurance with no less than the minimum limits required
by law; employer's liability insurance with such limits as required by law; and
commercial liability insurance, with a minimum limit of $1,000,000 per
occurrence and a minimum umbrella limit of $1,000,000, for a total minimum
combined general liability and umbrella limit of $2,000,000 (together with such
additional umbrella coverage as Landlord may reasonably require) for property
damage, personal injuries, or deaths of persons occurring in or about the
Premises. Landlord may from time to time require reasonable increases in any
such limits. The commercial liability policies shall name Landlord as an
additional insured, insure on an occurrence and not a claims-made basis, be
issued by insurance companies which are reasonably acceptable to Landlord, not
be cancelable unless 30 days' prior written notice shall have been given to
Landlord, contain a hostile fire endorsement and a contractual liability
endorsement and provide primary coverage to Landlord (any policy issued to
Landlord providing duplicate or similar coverage shall be deemed excess over
Tenant's policies). Such policies or certificates thereof shall be delivered to
Landlord by Tenant upon commencement of the Lease Term and upon each renewal of
said insurance.

      The all risk property insurance obtained by Landlord and Tenant shall
include a waiver of subrogation by the insurers and all rights based upon an
assignment from its insured, against Landlord or Tenant, their officers,
directors, employees, managers, agents, invitees and contractors, in connection
with any loss or damage thereby insured against. Neither party nor its
officers, directors, employees, managers, agents, invitees or contractors




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shall be liable to the other for loss or damage caused by any risk coverable by
all risk property insurance, and each party waives any claims against the other
party, and its officers, directors, employees, managers, agents, invitees and
contractors for such loss or damage. The failure of a party to insure its
property shall not void this waiver. Landlord and its agents, employees and
contractors shall not be liable for, and Tenant hereby waives all claims
against such parties for, business interruption and losses occasioned thereby
sustained by Tenant or any person claiming through Tenant resulting from any
accident or occurrence in or upon the Premises or the Project from any cause
whatsoever, including without limitation, damage caused in whole or in part,
directly or indirectly, by the negligence of Landlord or its agents, employees
or contractors.

      10. LANDLORD'S REPAIRS. Landlord shall maintain, at its expense, the
structural soundness of the roof, foundation, and exterior walls of the
Building in good repair, reasonable wear and tear and uninsured losses and
damages caused by Tenant, its agents and contractors excluded. The term "walls"
as used in this Paragraph 10 shall not include windows, glass or plate glass,
doors or overhead doors, special store fronts, dock bumpers, dock plates or
levelers or office entries. Tenant shall promptly give Landlord written notice
of any repair required by Landlord pursuant to this Paragraph 10, after which
Landlord shall have a reasonable opportunity to repair.

      11. TENANT'S REPAIRS. Tenant, as provided in Paragraph 6, shall maintain
in good repair and condition the parking areas and other common areas of the
Building, including, but not limited to driveways, alleys, landscape and
grounds surrounding the Premises. Subject to Landlord's obligation in Paragraph
S 10 and subject to Paragraphs 9 and 15, Tenant, at its expense, shall repair,
replace and maintain in good condition all portions of the Premises and all
areas, improvements and systems exclusively serving the Premises including,
without limitation, dock and loading areas, truck doors, plumbing, water, and
sewer lines up to points of common connection, fire sprinklers and fire
protection systems, entries, doors, ceilings and roof membrane, windows,
interior walls, and the interior side of demising walls, and heating,
ventilation and air conditioning systems. Such repair and replacements include
capital expenditures and repairs whose benefit may extend beyond the Term.
Heating, ventilation and air conditioning systems and other mechanical and
building systems serving the Premises shall be maintained at Tenant's expense
pursuant to maintenance service contracts entered into by Tenant or, at
Landlord's election, by Landlord. The scope of services and contractors under
such maintenance contracts shall be reasonably approved by Landlord. If Tenant
fails to perform any repair or replacement for which it is responsible,
Landlord may perform such work and be reimbursed by Tenant within 10 days after
demand therefor. Subject to Paragraphs 9 and 15, Tenant shall bear the full
cost of any repair or replacement to any part of the Building or Project that
results from damage caused by Tenant, its agents, contractors, or invitees and
any repair that benefits only the Premises.

      12.TENANT-MADE ALTERATIONS AND TRADE FIXTURES. Any alterations,
additions, or improvements made by or on behalf of Tenant to the Premises
("Tenant-Made Alterations") shall be subject to Landlord's prior written
consent. Tenant shall cause, at its expense, all Tenant-Made Alterations to
comply with insurance requirements and with Legal Requirements and shall
construct at its expense any alteration or modification required by Legal
Requirements as a result of any Tenant-Made Alterations. All Tenant-Made
Alterations shall be constructed in a good and workmanlike manner by
contractors reasonably acceptable to Landlord and only good grades of materials
shall be used. All plans and specifications for any Tenant-Made Alterations
shall be submitted to Landlord for its approval. Landlord may monitor
construction of the Tenant-Made Alterations. Tenant shall reimburse Landlord
for its costs in reviewing plans and specifications and in monitoring
construction. Landlord's right to review plans and specifications and to
monitor construction shall be solely for its own benefit, and Landlord shall
have no duty to see that such plans and specifications or construction comply
with applicable laws, codes, rules and regulations. Tenant shall provide
Landlord with the identities and mailing addresses of all persons performing
work or supplying materials, prior to beginning such construction, and Landlord
may post on and about the Premises notices of non-responsibility pursuant to
applicable law. Tenant shall enSURE payment for the completion of all work free
and clear of liens and shall provide certificates of insurance for worker's
compensation and other coverage in amounts and from an insurance company
satisfactory to Landlord protecting Landlord against liability for personal
injury or property damage during construction Upon completion of any
Tenant-Made Alterations, Tenant shall deliver to Landlord sworn statements
setting forth the names of all contractors and subcontractors who did work on
the Tenant-Made Alterations and final lien waivers from all such contractors
and subcontractors. Upon surrender of the Premises, all Tenant-Made Alterations
and any leasehold improvements constructed by Landlord or Tenant shall remain
on the Premises at Landlord's property, except to the extent Landlord's
requires removal at Tenant's expense of any such items or Landlord and Tenant
have otherwise agreed in writing in connection with Landlord's consent to any
Tenant-Made Alterations. Tenant shall repair any damage caused by such removal.

      Tenant, at its own cost and expense and without Landlord's prior
approval, may erect such shelves, bins, machinery and trade fixtures
(collectively "Trade Fixtures") in the ordinary course of its business provided
that such items do not alter the basic character of the Premises, do not
overload or damage the Premises, and may be removed without injury to the
Premises, and the construction, erection, and installation thereof complies
with all Legal Requirements and with Landlord's requirements set forth above.
Tenant shall remove its Trade Fixtures and shall repair any damage caused by
such removal.

      13. SIGNS. Tenant shall not make any changes to the exterior of the
Premises, install any exterior lights, decorations, balloons, flags, pennants,
banners, or painting, or erect or install any signs, windows, or door
lettering, placards, decorations, or advertising media of any type which can be
viewed from the exterior of the Premises, without Landlord's prior written
consent. Upon surrender or vacation of the Premises, Tenant shall have removed
all signs and repair, paint, and/or replace the building facia surface to which
its signs are attached. Tenant shall obtain




<PAGE>   5

all applicable governmental permits and approvals for sign and exterior
treatments. All signs, decorations, advertising media, blinds, draperies and
other window treatment or bars or other security installations visible from
outside the Premises shall be subject to Landlord's approval and conform in all
respects to Landlord's requirements.

      14. PARKING. Tenant shall be entitled to park in common with other
tenants of the Project in those areas designated for nonreserved parking.
Landlord may allocate parking spaces among Tenant and other tenants in the
Project if Landlord determines that such parking facilities are becoming
crowded. Landlord shall not be responsible for enforcing Tenant's parking
rights against any third parties.

      15. RESTORATION. If at any time during the Lease Term the Premises am
damaged by a fire or other casualty, Landlord shall notify Tenant within 60
days after such damage as to the amount of time Landlord reasonably estimates
it will take to restore the Premises. If the restoration time is estimated to
exceed 6 months from the date of damage, either Landlord or Tenant may elect to
terminate this Lease upon notice to the other party given no later than 30 days
after Landlord's notice. If neither party elects to terminate this Lease or if
Landlord estim tes that restoration will take 6 months or is less, then,
subject to receipt of sufficient insurance proceeds, Landlord shall promptly
restore the Premises excluding the improvements installed by Tenant or by
Landlord and paid by Tenant, subject to delays arising from the collection of
insurance proceeds or from Force Majeure events. Tenant at Tenant's expense
shall promptly perform, subject to delays arising from the collection of
insurance proceeds, or from Force Majeure events, all repairs or restoration 10
not required to be done by Landlord and shall promptly re-enter the Premises
and commence doing business in accordance with this Lease. Notwithstanding the
foregoing, either party may terminate this Lease if the Premises are damaged
during the last year of the Lease Term and Landlord reasonably estimates that
it will take more than one month to repair such damage, Tenant shall pay to
Landlord with respect to any-damage to the Premises the amount of the
commercially reasonably deductible under Landlord's insurance policy (CURRENTLY
$10,000) within 10 days after presentment of Landlord's invoice. If the damage
involves the premises of other tenants, Tenant shall pay the portion of the
deductible that the cost of the restoration of the Premises bears to the total
cost of restoration, as determined by Landlord. Base Rent and Operating
Expenses shall be abated for the period of repair and restoration in the
proportion which the area of the Premises, if any, which is not usable by
Tenant bears to the total area of the Premises. 'Such abatement shall be the
sole remedy of Tenant, and except as provided herein, Tenant waives any right
to terminate the Lease by reason of damage or casualty loss.

      16. CONDEMNATION. If any part of the Premises or the Project should be
taken for any public or quasi public use under governmental law, ordinance, or
regulation, or by right of eminent domain, or by private purchase in lieu
thereof (a "Taking" or "Taken"), and the Taking would prevent or materially
interfere with Tenant's use of in Landlord's judgment would materially
interfere with or impair its ownership or operation of the Project, then upon
written notice by Landlord this Lease shall terminate and Base Rent shall be
apportioned as of said date. If part of the Premises shall be Taken, and this
Lease is not terminated as provided above, the Base Rent payable hereunder
during the unexpired Lease Term shall be reduced to such extent as may be fair
and reasonable under the circumstances. In the event of any such Taking,
Landlord shall be entitled to receive the entire price or award from any such
Taking without any payment to Tenant, and Tenant hereby assigns to Landlord
Tenant's interest, if any, in such award. Tenant shall have the right, to the
extent that same shall not diminish Landlord's award, to make a separate claim
against the condemning authority (but not Landlord) for such compensation as
may be separately awarded or recoverable by TENANT FOR MERVING EXPENSES AND
DAMAGE a Tenant's Trade, Fixtures, if separate award for. such tagns is made G
Tenant.

      17. ASSIGNMENT AND SUBLETTING. Without Landlord's prior written consent,
Tenant shall not assign this Lease or sublease the Premises or any part thereof
or mortgage, pledge, or hypothecate its leasehold interest or grant any
concession or license within the Premises and any attempt to do any of the
foregoing shall be void and of no 4) effect. For purposes of this paragraph, a
transfer of the ownership interests controlling Tenant shall be deemed an
assignment of this Lease unless such ownership interests are publicly traded.
Notwithstanding the above, Tenant may assign or sublet the Premises, or any
part thereof, to any entity controlling Tenant, controlled by Tenant or under
no common control with Tenant (a "Tenant Affiliate"), without the prior written
consent of Landlord. Tenant shall th reimburse Landlord for all of Landlord's
reasonable out-of-pocket expenses in connection with any assignment or
sublease. Upon Landlord's receipt of Tenant's written notice of a desire to
assign or sublet the Premises, or any part ld thereof (other than to a Tenant
Affiliate), Landlord may, by giving written notice to Tenant within 30 days
after receipt of Tenant's notice, terminate this Lease with respect to the
space described in Tenant's notice, as of the date specified in Tenant's notice
for the commencement of the proposed assignment or sublease. Notwithstanding
any assignment or subletting, Tenant and any guarantor or surety of Tenant's
obligations under this Lease shall at all times remain fully responsible and
liable for the payment of the rent and for compliance with all of Tenant's
other obligations under this Lease (regardless of whether Landlord's approval
has beenm obtained for any such assignments or sublettings). In the event that
the rent due and payable by a sublessee or assignee (or a combination of the
rental payable under such sublease or assignment plus any bonus or other
consideration a therefor or incident thereto) exceeds the rental payable under
this Lease, then Tenant shall be bound and obligated to pay Landlord as
additional rent hereunder all such excess rental and other excess consideration
within 10 days following receipt thereof by Tenant. *fifty percent (50%) of If
this Lease be assigned or if the Premises be subleased (whether in whole or in
part) or in the event of the mortgage, pledge, or hypothecation of Tenant's
leasehold interest or grant of any concession or license within the Premises or
if the Premises be occupied in whole or in part by anyone other than Tenant,
then upon a default by Tenant hereunder Landlord may collect rent from the
assignee, sublessee, mortgagee, pledgee, party to whom the leasehold interest
was hypothecated, concessionee or licensee or other occupant and, except to the
extent set forth in




<PAGE>   6
the preceding paragraph, apply the amount collected to the next rent payable
hereunder; and all such rentals collected by Tenant shall be held in trust for
Landlord and immediately forwarded to Landlord. No such transaction or
collection of rent or application thereof by Landlord, however, shall be deemed
a waiver of these provisions or a release of Tenant from the further
performance by Tenant of its covenants, duties, or obligations hereunder.

      18. INDEMNIFICATION. EXCEPT FOR THE NEGLIGENCE OF LANDLORD, ITS AGENTS,
EMPLOYEES OR CONTRACTORS, to the extent permitted by law, Tenant agrees to
indemnify, defend and hold harmless Landlord, and Landlord's agents, employees
and contractors! from 'and against any and all losses, liabilities, damages,
costs and expenses (including attorneys' fees) resulting from claims by third
parties for injuries to any person and damage to or theft or misappropriation
or loss of property occurring in or about the Project and arising from the use
and occupancy of the Premises or from any activity, work, or thing done,
permitted or suffered by Tenant in or about the Premises or due to any other
act or omission of Tenant, its subtenants, assignees, invitees, employees,
contractors and agents. The furnishing of insurance required hereunder shall
not be deemed to limit Tenant's obligations under this Paragraph 18.

      19. INSPECTION AND ACCESS. Landlord and its agents, representatives, and
contractors may enter the Premises at any reasonable time to inspect the
Premises and to make such repairs as may be required or permitted pursuant to
this Lease and for any other business purpose. Landlord and Landlord's
representatives may enter the Premises during business hours for the purpose of
showing the Premises to prospective purchasers and, during the last year of the
Lease Term, to prospective tenants. Landlord may erect a suitable sign on the
Premises stating the Premises are available to let or that the Project is
available for sale. Landlord may grant easements, make public dedications,
designate common areas and create restrictions on or about the Premises,
provided that no such easement, dedication, designation or restriction
materially interferes with Tenant's use or occupancy of the Premises. At
Landlord's request, Tenant shall execute such instruments as may be necessary
for such easements, dedications or restrictions.

      20. QUIET ENJOYMENT. If Tenant shall perform all of the covenants and
agreements herein required to be performed by Tenant, Tenant shall, subject to
the terms of this Lem, at all times during the Lease Term, have peaceful and
quiet enjoyment of the Premises against any person claiming by, through or
under Landlord.

      21. SURRENDER. Upon termination of the Lease Term or earlier termination
of Tenant's right of possession, Tenant shall surrender the Premises to
Landlord in the same condition as received, broom clean, ordinary wear and tear
and casualty loss and condemnation covered by Paragraphs 15 and 16 excepted.
Any Trade Fixtures, Tenant-Made Alterations and property not so removed by
Tenant as permitted or required herein shall be deemed abandoned and may be
stored, removed, and disposed of by Landlord at Tenant's expense, and Tenant
waives all claims against Landlord for any damages resulting from Landlord's
retention and disposition of such property. All obligations of Tenant hereunder
not fully performed as of the termination of the Lease Term shall survive the
termination of the Lease Term, including without limitation, indemnity
obligations, payment obligations with respect to Operating Expenses and
obligations concerning the condition and repair of the Premises.

      22. HOLDING OVER. If Tenant retains possession of the Premises after the
termination of the Lease Term, unless otherwise agreed in writing, such
possession shall be subject to immediate termination by Landlord at any time,
and all of the other terms and provisions of this Lease (excluding any
expansion or renewal option or other similar right or option) shall be
applicable during such holdover period, except that Tenant shall pay Landlord
from time to time, upon demand, as Base Rent for the holdover period, an amount
equal to double the Base Rent in effect on the termination date, computed on a
monthly basis for each month or part thereof during such holding over. All
other payments shall continue under the terms of this Lease. In addition,
Tenant shall be liable for all damages incurred by Landlord as a result of such
holding over. No holding over by Tenant, whether with or without consent of
Landlord, shall operate to extend this Lease except as otherwise expressly
provided, and this Paragraph 22 shall not be construed as consent for Tenant to
retain possession of the Premises.

      23. EVENTS OF DEFAULT. Each of the following events shall be an event of
default ("Event of Default by Tenant under this Lease:

          (i)   Tenant shall fail to pay any installment of Base Rent or any
      other payment required herein when due, and such failure shall continue
      for a period of 5 days FROM THE DATE SUCH PAYFFIENT WAS DUE

          (ii)  Tenant or any guarantor or surety of Tenant's obligations
      hereunder shall (A) make a general assignment for the benefit of
      creditors; (B) commence any case, proceeding or other action seeking to
      have an order for relief entered on its behalf as a debtor or to
      adjudicate it a bankrupt or insolvent, or :3 seeking reorganization,
      arrangement, adjustment, liquidation, dissolution or composition of it or
      its debts or O seeking appointment of a receiver, trustee, custodian or
      other similar official for it or for all or of any I substantial part of
      its property (collectively a "proceeding for relief"); (C) become the
      subject of any S proceeding for relief which is not dismissed within 60
      days of its filing or entry; or (D) die or suffer a legal disability (if
      Tenant, guarantor, or surety is an individual) or be dissolved or
      otherwise fail to maintain its legal existence (if Tenant, guarantor or
      surety is a corporation, partnership or other entity).

          (iii) Any insurance required to be maintained by Tenant pursuant to
      this Lease shall be cancelled or terminated or shall expire or shall be
      reduced or materially changed, except, in each case, as permitted in this
      Lease.
<PAGE>   7

          (iv)  Tenant shall not occupy or shall vacate the Premises or shall
      fail to continuously operate its business at the Premises for the
      permitted use set forth herein, whether or not Tenant is in monetary or
      other default under this Lease. *' *(See Addendum One, Section VIII)

          (v)   Tenant shall attempt or there shall occur any assignment,
      subleasing or other transfer of Tenant's interest in or with respect to
      this Lease except as otherwise permitted in this Lease.

          (vi)  Tenant shall fail to discharge any lien placed upon the Premises
      in violation of this Lease within 30 days after any such lien or
      encumbrance is filed against the Premises.

          (vii) Tenant shall fail to comply with any provision of this Lease
      other than those specifically referred to in this Paragraph 23, and
      except as otherwise expressly provided herein, such default shall
      continue for more than 30 days after Landlord shall have given Tenant
      written notice of such default.

      24. LANDLORD'S REMEDIES. Upon each occurrence of an Event of Default and
so long as such Event of Default shall be continuing, Landlord may at any time
thereafter at its election: terminate this Lease or Tenant's right of
possession (but Tenant shall remain liable as hereinafter provided), and/or
pursue any other remedies at law or in equity. Upon the termination of this
Lease or termination of Tenant's right of possession, it shall be lawful for
Landlord, without formal demand or notice of any kind, to re-enter the Premises
by summary dispossession proceedings or any other action or proceeding
authorized by law and to remove Tenant and all persons and property therefrom.
If Landlord re-enters the Premises, Landlord shall have the right to keep in
place and use, or remove and store, all of the furniture, fixtures and
equipment at the Premises.

            If Landlord terminates this Lease, Landlord may recover from Tenant
the sum of: all Base Rent and all other amounts accrued hereunder to the date
of such termination; the cost of reletting the whole or any part of the
Premises, including without limitation brokerage fees and/or leasing
commissions incurred by Landlord, and costs of removing and storing Tenant's or
any other occupant's property, repairing, altering, remodeling, or otherwise
putting the Premises into condition acceptable to a new tenant or tenants, and
all reasonable expenses incurred by Landlord in pursuing its remedies,
including reasonable attorneys' fees and court costs; and the excess of the
then present value of the Base Rent and other amounts payable by Tenant under
this Lease as would otherwise have been required to be paid by Tenant to
Landlord during the period following the termination of this Lease measured
from the date of such termination to the expiration date stated in this Lease,
over the present value of any net amounts which Tenant establishes Landlord can
reasonably expect to recover by reletting the Premises for such period, taking
into consideration the availability of acceptable tenants and other market
conditions affecting leasing. Such present values shall be calculated at a
discount rate equal to the 90-day U.S. Treasury bill rate at the date of such
termination.

            If Landlord terminates Tenant's right of possession (but not this
Lease), Landlord may, but shall be under no obligation to, relet the Premises
for the account of Tenant for such rent and upon such terms as shall be
satisfactory to Landlord without thereby releasing Tenant from any liability
hereunder and without demand or notice of any kind to Tenant. For the purpose
of such reletting Landlord is authorized to make any repairs, changes,
alterations, or additions in or to the Premises as Landlord deems reasonably
necessary or desirable. If the Premises are not relet, then Tenant shall pay to
Landlord as damages a sum equal to the amount of the rental reserved in this
Lease for such period or periods, plus the cost of recovering possession of the
Premises (including attorneys' fees and costs of suit), the unpaid Base Rent
and other amounts accrued hereunder at the time of repossession, and the costs
incurred in any attempt by Landlord to relet the Premises. If the Premises are
relet and a sufficient sum shall not be realized from such reletting [after
first deducting therefrom, for retention by Landlord, the unpaid Base Rent and
other amounts accrued hereunder at the time of reletting the cost of recovering
possession (including attorneys' fees and costs of suit), all of the costs and
expense of repairs, changes, alterations, and additions, the expense of such
reletting (including without limitation brokerage fees and leasing commissions)
and the cost of collection of the rent accruing therefrom] to satisfy the rent
provided for in this Lease to be paid, then Tenant shall immediately satisfy
and pay any such deficiency. Any such payments due Landlord shall be made upon
demand therefor from time to time and Tenant agrees that Landlord may file suit
to recover any sums failing due from time to time. Notwithstanding any such
reletting without termination, Landlord may at any time thereafter elect in
writing to terminate this Lease for such previous breach.

            Exercise by Landlord of any one or more remedies hereunder granted
or otherwise available shall not be deemed to be an acceptance of surrender of
the Premises and/or a termination of this Lease by Landlord, whether by
agreement or by operation of law, it being understood that such surrender
and/or termination can be effected only by the written agreement of Landlord
and Tenant. Any law, usage, or custom to the contrary notwithstanding, Landlord
shall have the right at all times to enforce the provisions of this Lease in
strict accordance with the terms hereof, and the failure of Landlord at any
time to enforce its rights under this Lease strictly in accordance with same
shall not be construed as having created a custom in any way or manner contrary
to the specific terms, provisions, and covenants of this Lease or as having
modified the same. Tenant and Landlord further agree that forbearance or waiver
by Landlord to enforce its rights pursuant to this Lease or at law or in
equity, shall not be a waiver of Landlord's right to enforce one or more of its
rights in connection with any subsequent default. A receipt by Landlord of rent
or other payment with knowledge of the breach of any covenant hereof shall not
be deemed a waiver of such breach, and no waiver by Landlord of any provision
of this Lease shall be deemed to have been made unless expressed in writing and
signed by Landlord. To the greatest extent permitted by law, Tenant waives the
service of notice of Landlord's intention to re-enter as provided for in any
statute, or to institute legal proceedings to that end, and also waives all
right of redemption in case Tenant shall be dispossessed by a judgment or by
warrant of any court or judge. The terms "enter," "re-enter," entry" or
"re-entry," as used in this Lease, are not restricted




<PAGE>   8

to their technical legal meanings. Any reletting of the Premises shall be on
such terms and conditions as Landlord in its sole discretion may determine
(including without limitation a term different than the remaining Lease Term,
rental concessions, alterations and repair of the Premises, lease of less than
the entire Premises to any tenant and leasing any or all other portions of the
Project before reletting the Premises). Landlord shall not be liable, nor shall
Tenant's obligations hereunder be diminished because of, Landlord's failure to
relet the Premises or collect rent due in respect of such reletting

      25. TENANT'S REMEDIES/LIMITATION OF LIABILITY. Landlord shall not be in
default hereunder unless Landlord fails to perform any of its obligations
hereunder within 30 days after written notice from Tenant specifying such
failure (unless such performance will, due to the nature of the obligation,
require a period of time in excess of 30 days, then after such period of time
as is reasonably necessary). All obligations of Landlord hereunder shall be
construed as covenants, not conditions; and, except as may be otherwise
expressly provided in this Lease, Tenant may not terminate this I-ease for
breach of Landlord's obligations hereunder. All obligations of Landlord under
this Lease will be binding upon Landlord only during the period of its
ownership of the Premises and not thereafter. The term "Landlord" in this Lease
shall mean only the owner, for the time being of the Premises, and in the event
of the transfer by such owner of its interest in the Premises, such owner shall
thereupon be released and discharged from all obligations of Landlord
thereafter accruing, but such obligations shall be binding during the Lease
Term upon each new owner for the duration of such owner's ownership. Any
liability of Landlord under this Lease shall be limited solely to its interest
in the Project, and in no event shall any personal liability be asserted
against Landlord in connection with this Lease nor shall any recourse be had to
any other property or assets of Landlord.

      26. WAIVER OF JURY TRIAL. TENANT AND LANDLORD WAIVE ANY RIGHT TO TRIAL BY
JURY OR TO HAVE A JURY PARTICIPATE IN RESOLVING ANY DISPUTE, WHETHER SOUNDING
IN CONTRACT, TORT, OR OTHERWISE, BETWEEN LANDLORD AND TENANT ARISING OUT OF
THIS LEASE OR ANY OTHER INSTRUMENT, DOCUMENT, OR AGREEMENT EXECUTED OR
DELIVERED IN CONNECTION HEREWITH OR THE TRANSACTIONS RELATED HERETO.

      27. SUBORDINATION. This Lease and Tenant's interest and rights hereunder
are and shall be subject and subordinate at all times to the lien of any first
mortgage, now existing or hereafter created on or against the Project or the
Premises, and all amendments, restatements, renewals, modifications,
consolidations, refinancing, assignments and extensions thereof, without the
necessity of any further instrument or act on the part of Tenant. Tenant
agrees, at the election of the holder of any such mortgage, to attorn to any
such holder. Tenant agrees upon demand to execute, acknowledge and deliver such
instruments, confirming such subordination and such instruments of attornment
as shall be requested by any such holder. Tenant hereby appoints Landlord
attorney in fact for Tenant irrevocably (such power of attorney being coupled
with an interest) to execute, acknowledge and deliver any such instrument and
instruments for and in the name of the Tenant and to cause any such instrument
to be recorded. Notwithstanding the foregoing, any such holder may at any time
subordinate its mortgage to this Lease, without Tenant's consent, by notice in
writing to Tenant, and thereupon this Lease shall be deemed prior to such
mortgage without regard to their respective dates of execution, delivery or
recording and in that event such holder shall have the same rights with respect
to this Lease as though this Lease had been executed prior to the execution,
delivery and recording of such mortgage and had been assigned to such holder.
The term "mortgage" whenever used in this Lease shall be deemed to include
deeds of trust, security assignments and any other encumbrances, and any
reference to the "holder" of a mortgage shall be deemed to include the
beneficiary under a deed of trust. * *(See Addendum One, Section IX)

      28. MECHANIC'S LIENS. Tenant has no express or implied authority to
create or place any lien or encumbrance of any kind upon, or in any manner to
bind the interest of Landlord or Tenant in, the Premises or to charge the
rentals payable hereunder for any claim in favor of any person dealing with
Tenant, including those who may furnish materials or perform labor for any
construction or repairs. Tenant covenants and agrees that it will pay or cause
to be paid all sums legally due and payable by it on account of any labor
performed or materials furnished in connection with any work performed on the
Premises and that it will save and hold Landlord harmless from all loss, cost
or expense based on or arising out of asserted claims or liens against the
leasehold estate or against the interest of Landlord in the Premises or under
this Lease. Tenant shall give Landlord immediate written notice of the placing
of any lien or encumbrance against the Premises and cause such lien or
encumbrance to be discharged within 30 days of the filing or recording
thereof-, provided, however, Tenant may contest such liens or encumbrances as
long as such contest prevents foreclosure of the lien or encumbrance and Tenant
causes such lien or encumbrance to be bonded or insured over in a manner
satisfactory to Landlord within such 30 day period.

      29. ESTOPPEL CERTIFICATES. Tenant agrees, from time to time, within 10
days after request of Landlord, to execute and deliver to Landlord, or
Landlord's designee, any estoppel certificate requested by Landlord, stating
that this Lease is in full force and effect, the date to which rent has been
paid, that Landlord is not in default hereunder (or specifying in detail the
nature of Landlord's default), the termination date of this Lease and such
other matters pertaining to this Lease as may be requested by Landlord.
Tenant's obligation to furnish each estoppel certificate in a timely fashion is
a material inducement for Landlord's execution of this Lease. No cure or grace
period provided in this Lease shall apply to Tenant's obligations to timely
deliver an estoppel certificate. Tenant hereby irrevocably appoints Landlord as
its attorney in fact to execute on its behalf and in its name any such estoppel
certificate if Tenant fails to execute and deliver the estoppel certificate
within 10 days after Landlord's written request thereof.

      30. ENVIRONMENTAL REQUIREMENTS. Except for Hazardous Material contained
in products used by Tenant in de minimis quantities for ordinary cleaning and
office purposes, Tenant shall not permit or cause any party to bring any
Hazardous Material upon the Premises or transport, store, use, generate,
manufacture or release any




<PAGE>   9

Hazardous Material in or about the Premises without Landlord's prior written
consent. Tenant, at its sole cost and expense, shall operate its business in
the Premises in strict compliance with all Environmental Requirements and shall
remediate in a manner satisfactory to Landlord any Hazardous Materials released
on or from the Project by Tenant, its agents, employees, contractors,
subtenants or invitees Tenant shall complete and certify to disclosure
statements as requested by Landlord from time to time relating to Tenant's
transportation, storage, use, generation, manufacture, or release of Hazardous
Materials on the Premises. The term "Environmental Requirements" means all
applicable present and future statutes, regulations, ordinances, rules, codes,
judgments, orders or other similar enactments of any governmental authority or
agency regulating or relating to health, safety, or environmental conditions
on, under, or about the Premises or the environment, including without
limitation, the following: the Comprehensive Environmental Response,
Compensation and Liability Act; the Resource Conservation and Recovery Act; and
all state and local counterparts thereto, and any regulations or policies
promulgated or issued thereunder. The term "Hazardous Materials" means and
includes any substance, material, waste, pollutant, or contaminant listed or
defined as hazardous or toxic, under any Environmental Requirements, asbestos
and petroleum, including crude oil or any fraction thereof, natural gas, or
synthetic gas usable for fuel (or mixtures of natural gas and such synthetic
gas). As defined in Environmental Requirements, Tenant is and shall be deemed
to be the "operator" of Tenant's "facility" and the "owner" of all Hazardous
Materials brought on the Premises by Tenant, its agents, employees, contractors
or invitees and the wastes, by-products, or residues generated, resulting, or
produced therefrom.

            Tenant shall indemnify, defend, and hold Landlord harmless from and
against any and all losses (including, without limitation, diminution in value
of the Premises or the Project and loss of rental income from the Project),
claims, demands, actions, suits, damages (including, without limitation,
punitive damages), expenses (including, without limitation, remediation,
removal, repair, corrective action, or cleanup expenses), and costs (including,
without limitation, actual attorneys' fees, consultant fees or expert fees and
including, without limitation, removal or management of any asbestos brought
into the Premises or disturbed in breach of the requirements of this Paragraph
30, regardless of whether such removal or management is required by law) which
are brought or recoverable against, or suffered or incurred by Landlord as a
result of any release of Hazardous Materials for which Tenant is obligated to
remediate as provided above or any other breach of the requirements under this
Paragraph 30 by Tenant, its agents, employees, contractors, subterants,
assignees or invitees regardless of whether Tenant had knowledge of such
noncompliance. 'Me obligations of Tenant under this Para.gaph 30 shall survive
any termination of this Lease.

            Landlord shall have access to, and a right to perform inspections
and tests of, the Premises to determine Tenant's compliance with Environmental
Requirements, its obligations under this Paragraph 30, or the environmental
condition of the Premises. Access shall be granted to Landlord upon Landlord's
prior notice to Tenant and at such times so as to minimize, so far as may be
reasonable under the circumstances, any disturbance to Tenant's operations.
Such inspections and tests shall be conducted at Landlord's expense, unless
such inspections or tests reveal that Tenant has not complied with any
Environmental Requirement, in which case Tenant shall reimburse Landlord for
the reasonable cost of such inspection and tests. Landlord's receipt of or
satisfaction with any environmental assessment in no way waives any rights that
Landlord holds against Tenant. *(See Addendum One, Section V)

      31. RULES AND REGULATIONS. Tenant shall, at all times during the Lease
Term and any extension thereof, comply with all reasonable rules and
regulations at any time or from time to time established by Landlord covering
use of the Premises and the Project. The current rules and regulations are
attached hereto. In the event of any conflict between said rules and
regulations and other provisions of this Lease, the other terms and provisions
of this Lease shall control. Landlord shall not have any liability or
obligation for the breach of any rules or regulations by other tenants in the
Project.

      32. Security Service. Tenant acknowledges and agrees that, while Landlord
may patrol the Project, Landlord is not providing any security services with
respect to the Premises and that Landlord shall not be liable to Tenant for,
and Tenant waives any claim against Landlord with respect to, any loss by theft
or any other damage suffered or incurred by Tenant in connection with any
unauthorized entry into the Premises or any other breach of security with
respect to the Premises.

      33. Force Majeure. Landlord shall not be held responsible for delays in
the performance of its obligations hereunder when caused by strikes, lockouts,
labor disputes, acts of God, inability to obtain labor or materials or
reasonable substitutes therefor, governmental restrictions, governmental
regulations, governmental controls, delay in issuance of permits, enemy or
hostile governmental action, civil commotion, fire or other casualty, and other
causes beyond the reasonable control of Landlord ("Force Majeure").

      34. ENTIRE AGREEMENT. This Lease constitutes the complete agreement of
Landlord and Tenant with respect to the subject matter hereof. No
representations, inducements, promises or agreements, oral or written, have
been made by Landlord or Tenant, or anyone acting on behalf of Landlord or
Tenant, which are not contained herein, and any prior agreements, promises,
negotiations, or representations are superseded by this Lease. This Lease may
not be amended except by an instrument in writing signed by both parties
hereto.

      35. SEVERABILITY. If any clause or provision of this Lease is illegal,
invalid or unenforceable under present or future laws, then and in that event,
it is the intention of the parties hereto that the remainder of this I-ease
shall not be affected thereby. It is also the intention of the parties to this
Lease that in lieu of each clause or provision of this Lease that is illegal,
invalid or unenforceable, there be added, as a part of this Lease, a clause or
provision as similar in terms to such illegal, invalid or unenforceable clause
or provision as may be possible and be legal, valid and enforceable.




<PAGE>   10

      36. BROKERS. Tenant represents and warrants that it has dealt with no
broker, agent or other person in connection with this transaction and that no
broker, agent or other person brought about this transaction, other than the
broker, if any, set forth on the first page of this Lease, and Tenant agrees to
indemnify and hold Landlord harmless from and against any claims by any other
broker, agent or other person claiming a commission or other form of
compensation by virtue of having dealt with Tenant with regard to this leasing
transaction.

      37. MISCELLANEOUS. (a) Any payments or charges due from Tenant to
Landlord hereunder shall be considered rent for all purposes of this Lease.

          (b) If and when included within the term "Tenant," as used in this
      instrument, there is more than one person, firm or corporation, each
      shall be jointly and severally liable for the obligations of Tenant.

          (c) All notices required or permitted to be given under this Lease
      shall be in writing and shall be sent by registered or certified mail,
      return receipt requested, or by a reputable national overnight courier
      service, postage prepaid, or by hand delivery addressed to the parties at
      their addresses below, and with a copy sent to Landlord at 14100 East
      35th Place, Aurora. Colorado 80011. Either party may by notice given
      aforesaid change its address for all subsequent notices. Except where
      otherwise expressly provided to the contrary, notice shall be deemed
      given upon delivery.

          (d) Except as otherwise expressly provided in this Lease or as
      otherwise required by law, Landlord retains the absolute right to
      withhold any consent or approval.

          (e) At Landlord's request from time to time Tenant shall furnish
      Landlord with true and complete copies of its most recent annual and
      quarterly financial statements prepared by TENANT OR TENANT'S ACCOUNTANTS
      AND ANY other financial information or summaries that Tenant typically
      provides to its lenders or shareholders.

          (f) Neither this Lease nor a memorandum of lease shall be filed by or
      on behalf of Tenant in any public record. Landlord may prepare and file,
      and upon request by Landlord Tenant will execute, a memorandum of lease.

          (g) The normal rule of construction to the effect that any
      ambiguities are to be resolved against the drafting party shall not be
      employed in the interpretation of this Lease or any exhibits or
      amendments hereto.

          (h) The submission by Landlord to Tenant of this Lease shall have no
      binding force or effect, shall noi constitute an option for the leasing
      of the Premises, nor confer any right or impose any obligations upon
      either party until execution of this Lease by both parties.

          (i) Words of any gender used in this Lease shall be held and
      construed to include any other gender, and words in the singular number
      shall be held to include the plural, unless the context otherwise
      requires. The captions inserted in this Lease are for convenience only
      and in no way define, limit or otherwise describe the scope or intent of
      this Lease, or any provision hereof, or in any way affect the
      interpretation of this Lease.

          0) Any amount not paid by Tenant within 5 days after its due date in
      accordance with the terms of this Lease shall bear interest from such due
      date until paid in full at the lesser of the highest rate permitted by
      applicable law or 15 percent per year. It is expressly the intent of
      Landlord and Tenant at all times to comply with applicable law governing
      the maximum rate or amount of any interest payable on or in connection
      with this Lease. If applicable law is ever judicially interpreted so as
      to render usurious any interest called for under this Lease, or
      contracted for, charged, taken, reserved, or received with respect to
      this Lease, then it is Landlord's and Tenant's express intent that all
      excess amounts theretofore collected by Landlord be credited on the
      applicable obligation (or, if the obligation has been or would thereby be
      paid in full, refunded to Tenant), and the provisions of this Lease
      immediately shall be deemed reformed and the amounts thereafter
      collectible hereunder reduced, without the necessity of the execution of
      any new document, so as to comply with the applicable law, but so as to
      permit the recovery of the fullest amount otherwise called for hereunder.

          (k) Construction and interpretation of this Lease shall be governed
      by the laws of the state in which the Project is located, excluding any
      principles of conflicts of laws *both *and Landlord's I

          (1) Time is of the essence as to the performance of Tenant's
      obligations under this Lease.

          (in) All exhibits and addenda attached hereto are hereby incorporated
      into this Lease and made a part hereof. In the event of any conflict
      between such exhibits or addenda and the terms of this Lease, such
      exhibits or addenda shall control.

      38. Landlord's LIEN/SECURITY INTEREST. Tenant hereby grants Landlord a
security inter mmercial f the Lease constitutes a security agreement, within
the meaning of and pursuant to the Uniform Com 1!, 714 state in which the
Premises are situated as to all of Tenant's property situate in, or u , r d pon
or use in connection with the Premises (except merchandise sold in the ordinary
course of buss) as security for all of Tenant's obligations hereunder,
including, without limitation, the obligati n to pay rent. Such personalty thus
encumbered includes to specifically all trade and other fixm~es s for the
purpose of this Paragraph and inventory, equipment, contract rights, accounts
receivable and the proceeds thereof. in order to perfect such security
interest, Tenant shall execute such financing st file the same at Tenant's
expense at the state and county Uniform Commercial Code filing tatements and
OFFIOFTEN AS Landlord IN ITS DISCRETIO SHALL REQUIRE. mid TENANT HEREBY
IRREVOCABLY APPOINTS LANDLORD ITS AGENT




<PAGE>   11

for the PULP- of executing mid filing SUCH financing statements on Tenant's
BEHALF as Landlord deem NECESSARY Nothing contained in this Lease shall be
construed as a consent on the part of Lessor to subject the e estate of Lessor
to liability under the Flo pressly understood that the Lessor's estate shall
not

      39. Radon Gas. Radon is a naturally occurring radioactive gas, that when
it has accumulated in a building in sufficient quantities, may present health
risks to persons who are exposed to it over time. Levels of radon that exceed
federal and state guidelines have been found in buildings in Florida.
Additional information regarding radon and radon testing may be obtained from
your county public health unit.

      40. Limitation of Liability of Trustees, Shareholders, and Officers of
ProLogis Trust. Any obligation of liability whatsoever of ProLogis Trust, a
Maryland real estate investment trust, which may arise at any time under this
Lease or any obligation or liability which may be incurred by it pursuant to
any other instrument, transaction, or undertaking contemplated hereby shall not
be personally binding upon, nor shall resort for the enforcement thereof be had
to the property of, its trustees, directors, shareholders, officers, employees
or agents, regardless of whether such obligation or liability is in the nature
of contract, tort, or otherwise.

            IN WITNESS WHEREOF, Landlord and Tenant have executed this Lease as
of the day and year first above written.

TENANT:                                LANDLORD:

STERILE RECOVERIES. INC.              PROLOGIS LIMITED PARTNERSHIP IV, A

                                       DELAWARE LIMITED PARTNERSHIP BY:
                                       TV, INC. A DELAWARE CORPORATION, AS
                                       THE GENERAL PARTNER

TITLE:       V.                        By:
                                       Name: Paul C. Congleton
                                       Title: Senior Vice President

Address:                               Address:

   28100  U. S. Highway 19, Suite 201  207 D Kelsey Lane
   Clearwater, Florida 33761          Tampa, Florida 33619

WITNESS AS TO TENANT:                  WITNESS AS TO LANDLORD




<PAGE>   12

                             RULES AND REGULATIONS

   The sidewalk, entries, and driveways of the Project shall not be obstructed
   by Tenant, or its agents, or used by them for any purpose other than ingress
   and egress to and from the Premises. Tenant shall not place any objects,
   including antennas, outdoor furniture, etc., in the parking areas,
   LANDSCAPED AREAS or other areas outside of its Premises, or on the roof of
   the Project.

3.  Except for seeing-eye dogs, no animals shall be allowed in the offices,
    halls, or corridors in the Project.

4.  Tenant shall not disturb the occupants of the Project or adjoining
    buildings by the use of any radio or musical instrument or by the making of
    loud or improper noises. If Tenant desires telegraphic, telephonic or other
    electric connections in the Premises, Landlord or its agent will direct the
    electrician as to where and how the wires may be introduced; and, without
    such direction, no boring or cutting of wires will be permitted. Any such
    installation or connection shall be made at Tenant's expense.

6.  Tenant shall not install or operate any steam or gas engine or boiler, or
    other mechanical apparatus in the Premises, except as specifically approved
    in the Lease. The use of oil, gas or inflammable liquids for heating,
    lighting or any other purpose is expressly prohibited. Explosives or other
    articles deemed extra hazardous shall not be brought into the Project.
    Parking any type of recreational vehicles is specifically prohibited on or
    about the Project. Except for the overnight parking of operative vehicles,
    no vehicle of any type shall be stored in the parking areas at any time. In
    the event that a vehicle is disabled, it shall be removed within 48 hours.
    There shall be no "For Sale" or other advertising signs on or about any
    parked vehicle- All vehicles shall be parked in the designated parking
    areas in conformity with all signs and other markings. All parking will be
    open parking, and no reserved parking, numbering or lettering of individual
    spaces will be permitted except as specified by Landlord.

8.  Tenant shall maintain the Premises free from rodents, insects and other
    pests.

9.  Landlord reserves the right to exclude or expel from the Project any person
    who, in the judgment of Landlord, is intoxicated or under the influence of
    liquor or drugs or who shall in any manner do any act in violation of the
    Rules and Regulations of the Project.

10. Tenant shall not cause any unnecessary labor by reason of Tenant's
    carelessness or indifference in the preservation of good order and
    cleanliness. Landlord shall not be responsible to Tenant for any loss of
    property on the Premises, however occurring, or for any damage done to the
    effects of Tenant by the janitors or any other employee or person. Tenant
    shall give Landlord prompt notice of any defects in the water, lawn
    sprinkler, sewage, gas pipes, electrical lights and fixtures, heating
    apparatus, or any other service equipment affecting the Premises.

12.Tenant shall not permit storage outside the Premises, including without
   limitation, outside storage of trucks and other vehicles, or dumping of
   waste or refuse or permit any harmful materials to be placed in any drainage
   system or sanitary system in or about the Premises.

13. All moveable trash receptacles provided by the trash disposal firm for the
    Premises must be kept in the trash enclosure areas, if any, provided for
    that purpose. No auction, public or private, will be permitted on the
    Premises or the Project.

15. No awnings shall be placed over the windows in the Premises except with the
    prior written consent of Landlord.

16. The Premises shall not be used for lodging, sleeping or cooking or for any
    immoral or illegal purposes or for any purpose other than that specified in
    the Lease. No gaming devices shall be operated in the Premises. Tenant
    shall ascertain from Landlord the maximum amount of electrical current
    which can safely be used in the Premises, taking into account the capacity
    of the electrical wiring in the Project and the Premises and the needs of
    other tenants, and shall not use more than such safe capacity. Landlord's
    consent to the installation of electric equipment shall not relieve Tenant
    from the obligation not to use more electricity than such safe capacity.

18.Tenant assumes full responsibility for protecting the Premises from theft,
    robbery and pilferage.

19.Tenant shall not install or operate on the Premises any machinery or
    mechanical devices of a nature not directly related to Tenant's ordinary
    use of the Premises and shall keep all such machinery free of vibration,
    noise and air waves which may be transmitted beyond the Premises.




<PAGE>   13

                                  ADDENDUM ONE

                                 MISCELLANEOUS
                 ATTACHED TO AND A PART OF THE LEASE AGREEMENT
                              DATED 1999, BETWEEN
                        PROLOGIS LIMITED PARTNERSHIP TV
                                      AND
                            STERILE RECOVERIES, INC.

1.   MONTHLY BASE RENT SCHEDULE. The monthly Base Rent and Operating Expenses
     shall be abated for the first three (3) months of the Lease Term (August
     1, 1999 October 31, 1999).

H.   Notwithstanding anything contained herein to the contrary, Landlord's
     costs relating to its annual roof inspection shall be included as part of
     Operating Expenses under Paragraph 6, and Ten shall beobligated for the
     payment of its Proportionate Share of such costs thereof.

Ill. Notwithstanding anything contained herein to the contrary, Tenant shall be
     responsible for the maintenance, repair and replacement of all portions of
     the Building, (including, without limitation, the commonareas of the
     Building) and for all costs and expenses related thereto (including,
     without limitation, paving and parking areas, roads, roofs, alleys, and
     driveways, mowing, landscaping, exterior painting, utility lines, heating,
     ventilation and air conditioning systems, lighting, electrical systems and
     other mechanical and building systems; amounts paid to contractors and
     subcontractors for work or services performed in connection with any of
     the foregoing; security services, if any; and trash collection, sweeping
     and removal). In the event Tenant does not maintain the foregoing
     responsibilities or maintain the commonareas of the Building in a
     condition acceptable to Landlord, Landlord shall perform such work, and
     all costs related thereto (including, but not limited to, property
     management fees) shall be reimbursed to Landlord as Operating Expenses in
     accordance with the provisions of this Paragraph 6.

IV.  after notice from Landlord to Tenant that such payment was due; provided,
     however, that Landlord shall not be obligated to provide written notice of
     such failure more than 2 times in any consecutive 12-month period, and the
     failure of Tenant to pay any third or subsequent installment of Base Rent
     or any other payment required herein when due in any consecutive 12-month
     period shall constitute an Event of Default by Tenant under this Lease
     without the requirement of notice or opportunity to cure.

V.   Notwithstanding anything to the contrary in this Paragraph 30, Tenant
     shall have no liability of any kindto Landlord as to Hazardous Materials
     on the Premises caused or ]2ermitted by: (i) Landlord, its
     agents,employees, contractors or invitees; or (ii) any other * tenants in
     the Project or their agents, employees, contractors, subtenants, assignees
     or (iii) any other person or entity located outside of the Premises or the
     Project.

VI.  Landlord will repair, prior to the Commencement Date, at its sole cost and
     expense, any roof leaks that may currently exist.

VII. If there are any warranties that are still in place, then the benefit of
     those warranties will be assigned to the Tenant.

VII  1. Vacation of Premises. Tenant's vacating of the Premises shall not
     constitute an Event of Default if, prior to vacating the Premises, Tenant
     has made arrangements reasonably acceptable to Landlord to (a) insure that
     Tenant's insurance for the Premises will not be voided or cancelled with
     respect to the Premises as a result of such vacancy, (b) insure that the
     Premises are secured and not subject to vandalism, and (c) insure that the
     Premises will be properly maintained after such vacation. Tenant shall
     inspect the Premises at least once each month and report monthly in
     writing to Landlord on the condition of the Premises.

IX.  Non-Disturbance Agreement. Tenant shall not be obligated to subordinate
     the Lease or its interest therein to any future mortgage, deed, of trust
     or ground lease on the Project unless concurrently with such subordination
     the holder of such mortgage or deed of trust or the ground lessor under
     such ground lease agrees not to disturb Tenant's possession of the
     Premises under the terms of the Lease in the event such holder or ground
     lessor acquires title to the Premises through foreclosure, deed in lieu of
     foreclosure or otherwise. Tenant shall be for any FEES or EXPENSES charged
     by the holde OF SUCH MORTGAGE or deed of trust in connection with the
     granting Of such non disturbance agreemen

X.   Security Deposit. Tenant shall not be obligated to submit the Security
     Deposit to Landlord until six (6) months prior to the expiration date of
     the Lease Term. Should Tenant exercise it Renewal Option(s), per the terms
     of Addendum Four, then the submission of the Security Deposit will be
     delayed until six (6) months prior to the expiration date of the First or
     Second Extension Term, as the case may be.




<PAGE>   14

                                  ADDENDUM TWO

                                  CONSTRUCTION
                                  (ALLOWANCE)

                 ATTACHED TO AND A PART OF THE LEASE AGREEMENT
                           DATED I 6/15 1999, BETWEEN

                        PROLOGIS LIMITED PARTNERSHIP TV

                                      and

                            STERILE RECOVERIES, INC.

      (a) Landlord agrees to furnish or perform those items of construction and
those improvements (the 'Tenant improvements") specified below:
          Remove building structure in truck court/parking area.
          Remove wood fencing and concrete containment walls located outside
            the Northwest side of the Building.
          Remove interior pipes and repair wall penetrations located along the
            Northwest wall of the Building.
          Repair uneven section of warehouse floor.
          Add additional paved parking area along the Northwest side of the
Building, Landlord shall pay for tile Tenant Improvements up to a maximum
amount of $30,000.00 and Tenant shall pay for the cost of tile Tenant
Improvements in excess of such amount. If tile cost of the Tenant Improvements
is estimated to exceed such amount, such estimated overage shall be paid by
Tenant before Landlord begins construction and a final adjusting payment based
upon the actual costs of tile Tenant Improvements shall be made when the Tenant
Improvements are complete.

      (b) If Tenant shall desire any changes, Tenant shall so advise Landlord
in writing and Landlord shall determine whether such changes can be made in a
reasonable and feasible manner. Any and all costs of reviewing any requested
changes, and any and all costs of making any changes to the Tenant Improvements
which Tenant may request and which Landlord may agree to shall be at Tenant's
sole cost and expense and shall be paid to Landlord upon demand and before
execution of (lie change order.

      (c) Landlord shall proceed with and complete the construction of the
Tenant Improvements. As soon as such improvements have been substantially
completed, Landlord shall notify Tenant in writing of the date that (lie Tenant
Improvements were Substantially Completed. Such date, unless an earlier date is
specified as tile Commencement Date in this Lease or otherwise agreed it) in
writing between Landlord and Tenant, shall be the "Commencement Date," unless
the completion of such improvements was delayed due to any act or omission of,
or delay caused by, Tenant including, without limitation, Tenant's failure to
approve plans, complete submittals or obtain permits within the time periods
agreed to by the parties or as reasonably required by Landlord, in which case
the Commencement Date shall be the date such improvements would have been
completed but for the delays caused by Tenant, The Ten4nt improvements shall be
deemed substantially completed ("Substantially Completed") when, in the opinion
of the construction manager (whether an employee or agent of Landlord or a
third party construction manager), the Premises are substantially completed
except for punch list items which do not prevent in any material way the use of
the Premises for the purposes for which they were intended. After the
Commencement Date Tenant shall, upon demand, execute and deliver to Landlord a
letter of acceptance of delivery of the Premises.

      (d) The failure of Tenant to take possession of or to occupy the Premises
shall not serve to relieve Tenant of obligations arising on the Commencement
Date or delay the payment of rent by Tenant. Subject to applicable ordinances
and building codes governing Tenant's right to occupy or perform in the
Premises, Tenant shall be allowed to install its tenant improvements,
machinery, equipment, fixtures, or other property on the Premises during the
final stages of completion of construction provided that Tenant does not
thereby interfere with the completion of construction or cause any labor
dispute as a result of such installations, and provided further that Tenant
does hereby agree to indemnify, defend, and hold Landlord harmless from any
loss or damage to such property, and all liability, loss, or damage arising
from any injury to tile Project or the property of Landlord, its contractors,
subcontractors, or materialmen, and any death or personal injury to any person
or persons arising out of such installations, whether or not any such loss,
damage, liability, death, or personal injury was caused by Landlord's
negligence. Any such occupancy or performance in the Premises shall be in
accordance with tile provisions governing Tenant-Made Alterations and Trade
Fixtures in the Lease, and shall be subject to Tenant providing to Landlord
satisfactory evidence of insurance for personal injury and property damage
related to such installations and satisfactory evidence of payment arrangements
with respect to installations permitted hereunder. Delay in putting Tenant in
possession of the Premises shall not serve to extend the term of this Lease or
to make Landlord liable for any damages arising therefrom.

      (e) Except for incomplete punch list items, Tenant upon tile Commencement
Date shall have and hold the Premises as the same shall then be without any
liability or obligation on the part of Landlord for making any further
alterations or improvements of any kind in or about the Premises.




<PAGE>   15

                                 ADDENDUM THRE
                      ASSIGNMENT AND SUBLETTING (CONSENT)
                      ATTACHED TO AND A PART OF THE LEASE
                                   AGREEMENT
                            DATED 6/15 1222, BETWEEN
                        PROLOGIS LIMITED PARTNERSHIP IV
                                      and
                            STERILE RECOVERIES, INC.

      (a) Landlord shall not unreasonably withhold its consent to Tenant's
request for permission to assign the Lease or sublease all or part of the
Premises. It shall be reasonable for the Landlord to withhold its consent to
any assignment or sublease in any of the following instances:

          (i) The assignee or sublessee does not have a net worth calculated
      according to generally accepted accounting principles at least equal to
      the greater of the net worth of Tenant immediately prior to such
      assignment or sublease or the net worth of the Tenant at the time it
      executed the Lease:

          (ii) The intended use of the Premises by the assignee or sublessee is
      not reasonably satisfactory to Landlord;

          (iii) 'Me intended use of the Premises by the assignee or sublessee
      would materially increase the pedestrian or vehicular traffic to the
      Premises or the Project;

          (iv) Occupancy of the Premises by the assignee or sublessee would, in
      Landlord's opinion, violate any agreement binding upon Landlord or the
      Project with regard to the identity of tenants, usage in the Project, or
      similar matters:

          (v) The identity or business reputation of the assignee or sublessee
      will, in the good faith judgment of Landlord, tend to damage the goodwill
      or reputation of the Project;

          (vi) The assignment or sublet is to another tenant in the Project and
      is at rates which are below those charged by Landlord for comparable
      space in the Project; (vii) In the case of a sublease, the subtenant has
      not acknowledged that the Lease controls over any inconsistent provision
      in the sublease; or (viii)The proposed assignee or sublessee is a
      government entity. foregoing criteria shall not exclude any other
      reasonable basis for Landlord to refuse its consent to such assignment or
      sublease.

      (b) Any approved assignment or sublease shall be expressly subject to the
terms and conditions of this Lease.

      (c) Tenant shall provide to Landlord all information concerning the
assignee or sublessee as Landlord may request.

      (d) Landlord may revoke its consent immediately and without notice if, as
of the effective date of the assignment or sublease, there has occurred and is
continuing any default under the Lease.

      (e) Landlord's agreement to not unreasonably withhold its consent shall
only apply to the first assignment or sublease under the Lease.




<PAGE>   16

                                 ADDENDUM FOUR
                                RENEWAL OPTIONS
                                   (BASEBALL
                                  ARBITRATION)
                 ATTACHED TO AND A PART OF THE LEASE AGREEMENT
                           DATED I 6/15 1999, BETWEEN
                        PROLOGIS LIMITED PARTNERSHIP IV
                                      and
                            STERILE RECOVERIES INC.

      (1) Provided that as of (lie time of tile giving of the First Extension
Notice and tile Commencement Date of the First Extension Term, (x) Tenant is
tile Tenant originally named herein, (y) Tenant actually occupies all of the
Premises initially demised under this Lease and any spice added to tile
Premises, and (z) no Event of Default exists or would exist but for the passage
of time or tile giving of notice, or both; then Tenant shall have the right to
extend die Lease Term for all additional term of 5 years (such additional lei
in is hereinafter called (tic "rim Extension Term") commencing oil the (lay
following the expiration of tile Lease Term (hereinafter referred to as tile
"Commencement Date of the First Extension Term") 'Tenant shall give Landlord
notice (hereinafter called file "First Extension Notice") of its election to
extend the term of [lie Lease Term at least 6 months, but not more than months,
prior to the scheduled expiration date of the Lease Term.

      (b) Provided that as of the time of the giving of [lie Second Extension
Notice and the Commencement Date of tile Second Extension Term, (x) Tenant is
the Tenant originally named all of the Premises initially demised under this
Lease and any space added to the Premises, and (z) no Event of Default exists
or would exist but for (lie passage of time or the giving of notice, or both
and provided Tenant his exercised its option for tile First Extension Term;
then Tenant shall have the right to extend the Lease Term additional term of 5
years (such additional term is hereinafter called the "Second Extension Term")
commencing on the (lay following (lie expiration of (lie First Extension Term
(hereinafter referred to as the "Commencement D te of the Second Extension
Term") Tenant shall give Landlord notice (hereinafter called tile "Second
Extension Notice") of its election to extend the term of tile Lease Term at
least A months, but not more than 2 months, prior to tile scheduled expiration
date of (lie First Extension Term.

      (c) The Base Rent payable by Tenant to Landlord during tile First
Extension Term shall be the -- -- I of (i) the Base Rent applicable to the last
year of tile initial Lease term and (ii) the then prevail comparable spice in
tile Project and comparable buildings in (lie vicinity of the Projec of tile
Lease, tile length of the renewal term, market escalation.% and life credit
unit. The Rise Rent shall not be reduced by reason of any costs or expenses
saved 1)), Landlord by reason of Landlord's not having to find a new tenant for
such Premises (including, will itation, brokerage commissions, costs of
improvements, rent concessions or lost rental income agreement on such ren dur
g any vacancy period), In the event Landlord and Tenant fail to reach all ntal
rate and execute the Amendment (defined below) at least 0 months prior to (lie
expiration of [tic Lease, then Tenant's exercise of tile renewal option shall
be deemed withdrawn and (lie Lease shall terminate original expi ion d le
$12,682.00 per month.

      (d) The Base Rent payable by Tenant to Landlord during the Extension Term
shall be the greater of: First Extension Term.

          (i) the Base Refit in effect oil tile expiration or the Lease Term
      (if the Base Rent is stated as all annual or other periodic rate,
      adjusted for tile length of the Lease Term) and *First Extension Term

          (ii) tile Fair Market Refit, as defined and determine([ pursuant to
      Paragraphs (e), (f), and (9) t below. n 0 The term "Fair Market Ren shall
      in tile Base Rent, expressed as *Second (e) l rent per square foot of
      floor area, which Landlord would have received from ]casing file Premises
      for the Extension Term to in unaffiliated person which is not then a
      tenant in (lie Project, assuming that such space were to be delivered in
      "is-is" condition, and liking into account the rental which such other
      tenant would most likely have paid For such premises, 11 including market
      escalations, provided that Fair Market Rent shall not in any event be
      less than tile Base Refit for the Premises as of the expiration of the
      Lease Term. Fair Market Refit shall not be reduced by reason of my costs
      or expenses saved by Landlord by reason of Landlord's not having to find
      a new tenant for the Premises (including w t out inflation brokerage
      commissions, cost of improvements necessary to prepare tile spice for
      such tenant's occupancy, rent concession, or lost rental income during
      any vacancy period). Fair Market Refit means only (lie ill ark ket rate
      for tile size rent component defined as Base Refit in the Lease and does
      not include reimbursements and payments by Tenant to Landlord with
      respect to operating expenses and other items payable or reimbursable by
      Tenant under (be Lease. In addition to its obligation to pay Base Rent
      (as determined herein), Tenant shall continue to pay and reimburse
      Landlord as set forth in file Lease with respect to such operating
      expenses and other items with respect to (lie mises during the Extension
      Term described below shall be limited of the Base Refit and shall not
      affect or otherwise reduce or modify the Tenant's obligation to ply or
      reimburse Landlord for such operating expenses and other reimbursable
      items.




<PAGE>   17

      rm (f)Landlord shall notify Tenant of its determination of the Fair
      Market Rent (which shall be made Tein Landlord's -tole discretion and
      shall in any event he not less thin the Base Rent in effect as of the
      expiration of (R)R Lease Term)* ill Extension Term, and Tenant shall
      advise Landlord of any objection within 10 days of -day period shall
      constitute Tenant's acceptance of receipt of Landlord's notice. Failure
      to respond within file 10 such Fair Market Rent. If Tenant objects,
      Landlord and Tenant shall commence negotiations to attempt to agree upon
      the Fair Market Rent within 30 days of Landlord's receipt of Tenant's
      notice. If (lie parties cannot agree, each faith but without any
      obligation to agree, then [lie Lease Term shall not be extended and shall
      acting in good fa terminate oil its scheduled termination date and Tenant
      shall have no further right hereunder or ally remedy by 0 reason of the
      parties' failure to agree unless Tenant or Landlord invokes the
      arbitration procedure provided below to determine (lie Fair Market Rent.

      (9) Arbitration to determine the Fail- Market Rent shall be in accordance
with the Real Estate Valuation Arbitration Rules of the American Arbitration
Association. Unless otherwise required by state law, arbitration shall be
conducted in the metropolitan area where the Project is located by a single
arbitrator unaffiliated with either party. Either Party may elect to arbitrate
by sending written notice to die other party and the Regional Office of (he
tAmerica., Arbitration Association within 5 days after (he 30-day negotiating
period provided in Paragraph (f) invoking the binding arbitration provisions of
this paragraph. Landlord and Tenant shall each submit to the nv ITS 0arbitrator
their respective proposal of Fair Market Rent.The arbitrator must choose
between the Landlord's proposaland the Tenant's proposal and may not compromise
between the two or select some other amount. Notwithstanding any other
provision herein, the Fair Market Rent determined by the arbitrator shall not
be less (hall, and the -arbitrator shall have no authority to determine a Fair
Market Rent less than, the Base Rent in effect as of xpiration of the Lease
TermThe cost of the arbitration shall be paid by Landlord if the Fair Market
Rent is [hit proposed by Landlord and by Tenant if the Fair Market Rent is that
proposed by Tenant; and shall be borne equally otherwise. If [he arbitrator his
not determined the Fair Market Rent as of the end of th ase Term, Tenant shall
pay 105 percent of the Base Rent in effect under the Lease as of the end of the
Lease Te until the Fair Market Rent is determined as provided herein.Upon such
determination, Landlord and Tenant shall make tile appropriate adjustments to
the payments between them.*First Extension Term 0

      (h) The parties consent to the jurisdiction of any appropriate court to
ENFORCE THE ARBITRATION PROVISIONS OF THIS ADDENDUM and to enter judgment upon
the decision of (lie -arbitrator. Te *Terms for the Base Rent as determined
above, Tenant's occupancy of the Premises during the Extension 1 OF shall be on
the same terms and conditions as are in effect immediately prior to the
expiration of file initial Lease Term; provided, however, Tenant shall have no
further right to extend the Lease Term pursuant to this .addendum or to any
allowances, credits or abatements or options to expand, contract, renew or
extend the Lease. *Notices

      (j) If Tenant does not send (lie Extension Notice within the period set
forth IN PARAGRAPH (A) Tenant's right to extend the Lease Term shall
automatically terminate. Time is of (lie essence as to the giving of die
Extension Notice and the notice of Tenant's objection wider Paragraph (f)
either the First or Second Extension Terms

      (k) Landlord shall have no obligation to refurbish or otherwise improv
(he Premises for the Extension The Premises shall be tendered on the
Commencement Date ofion Ter in "as-is" condition. Fir t and Second Exte sion Te
First and Second Extension Terms

      (1) If the Lease is ended for the *Extension Term then Landlord shall
prepare and Tenant shall execute an amendment to the Lease confirming the
extension of the Lease Term and the other provisions applicable thereto. *
First and Second Extension Terms

      (in) If Tenant exercises its right to extend the term of the Lease for
the Extension Extension Term pursuant to Addendum, the term "Lease Term" as
used in file Lease, shall be construed to include, when practicable, (lie
Extension Term except as provided in (j ) above. *First and Second *Terms I




<PAGE>   18

                                 ADDENDUM FIVE
                                PURCHASE OPTION
                              ATTACHED TO AND A PA
                           ART OF THE LEASE AGREEMENT
                           DATED 6/15 .1999, BETWEEN
                        PROLOGIS LIMITED PARTNERSHIP IV
                                      AND
                            STERILE RECOVERIES, INC.

      Provided that as of the date of the giving of Teriant's Purchase Option
Notice Landlord's notice (x) Tenant is the Tenkint originally named herem, (y)
Tenant actually occu originally demised kinder this Lease and any premises
added to the Promises, kind (z) no Event of Defauh. or event which but for tire
passage of time or tire giving of notice, or both, would Constitute all Event o
occurred and is confinuing, then subject to still in accordance ivith fire
terms of this Addendum Ten M. lite right and option (the "Purchase Option") to
purchase the Building.* Tenant s hall exercis by delivering written notice
("Purchase, Option Notice,") to Landlord at any tone during the

      0 E xh B I Purch The Purchasforth in Landlo cleric to exercise its
Purchase Option tied close on the Premises (see Exhibit B attached hereto add
made a part hereof) within the first (1st) year of the Lease Terin, the
Purchase Price will be set at $1,360,000. The Purchase Price will increase try
four percent (4%) each year thereafter,

      2. CLOSING. THE CLOSING SHALL BE CONDUCTED THROUGH AN ESCROW ESTABLISHED
AT A TITLE COMPANY ACCEPTABLE TO BOTH LANDLORD AND TENANT. ALL DELIVERIES SHALL
BE DEPOSITED IN ESCROW AND ALL CLOSING DELIVERIES AND DISBURSEMENTS SHALL BE
MADE THROUGH THE ESCROW. THE CLOSING SHALL OCCUR NO LATER THAN 60 DAYS
FOLLOWING THE EXERCISE OF THE PURCHASE OPTION.

      3. INSPECTION. FOR A PERIOD OF 30 DAYS AFTER THE DATE OF TENANT'S
PURCHASE OPTION NOTICE TO LANDLORD, TENANT SHALL BE ENTITLED TO INSPECT THE
PREMISES. TENANT SHALL INDEMNIFY AND DEFEND LANDLORD FOR ANY CLAIM, DAMAGE OR
LIABILITY ARISING OUT OF TENANT'S AND ITS AGENT'S AND CONTRACTOR'S INSPECTION.
TENANT MAY REVOKE ITS ELECTION TO EXERCISE THE PURCHASE OPTION BY NOTICE TO
LANDLORD WITHIN THE 30-DAY PERIOD IF TENANT IS NOT SATISFIED WITH ANY ASPECT OF
THE PREMISES, IN WHICH CASE THIS LEASE SHALL CONTINUE IN FULL FORCE AND EFFECT.

      4. TITLE. LANDLORD SHALL CONVEY TO TENANT FEE SIMPLE TITLE TO THE
PREMISES BY SPECIAL WARRANTY DEED (WARRANTING TITLE BY, THROUGH, OR UNDER
LANDLORD, BUT NOT OTHERWISE) SUBJECT ONLY TO ALL MATTERS OF RECORD AND THOSE
MATTERS WHICH A CORRECT SURVEY WOULD SHOW BUT FREE AND CLEAR OF ANY LIENS OR
ANY OTHER EXCEPTIONS CREATED BY, UNDER, OR THROUGH LANDLORD. TENANT SHALL HAVE
THE ABSOLUTE RIGHT TO APPROVE TITLE TO THE PROPERTY, AND IF TITLE IS NOT
SATISFACTORY, TENANT MAY REVOKE ITS ELECTION TO EXERCISE THE PURCHASE OPTION BY
GIVING NOTICE TO LANDLORD (X) WITHIN THE INSPECTION PERIOD IN SUBPARAGRAPH (A)
ABOVE AND, (Y) WITH RESPECT TO ANY TITLE EXCEPTIONS OF WHICH PURCHASER IS
NOTIFIED AFTER SUCH INSPECTION PERIOD BUT BEFORE THE CLOSING, AT ANY TIME
BEFORE THE CLOSING. LANDLORD SHALL ASSIGN TO TENANT ALL ITS RIGHT, TITLE AND
INTEREST IN AND TO ALL CONTRACTS, WARRANTIES, PERMITS, APPROVALS, AND OTHER
INTANGIBLE PROPERTY RELATED TO THE PREMISES EXCEPT FOR ANY TRADENAME OR OTHER
SIMILAR RIGHTS RELATED TO THE PREMISES, WHICH LANDLORD SHALL RETAIN.

      5.PRORATIONS. THERE SHALL BE NO PRORATION OF TAXES OR OTHER EXPENSES.

      6. LEASE TERMINATION. THE LEASE SHALL BE TERMINATED AS OF THE CLOSING.
ALL RENT AND OTHER PAYMENTS DUE BY TENANT TO LANDLORD UNDER THE LEASE SHALL BE
PRORATED TO THE DATE OF CLOSING AND SHALL BE DEPOSITED INTO THE ESCROW AND
DISBURSED TO LANDLORD AT CLOSING.

      7. NO WARRANTY. LANDLORD MAKES NO, AND AT CLOSING TENANT SHALL WAIVE IN
WRITING SATISFACTORY TO LANDLORD ANY, WARRANTY OR REPRESENTATION WITH RESPECT
TO THE PREMISES (OTHER THAN TITLE TO THE PREMISES AS PROVIDED ABOVE) AND SHALL
RELEASE LANDLORD FROM ANY RIGHT OR CLAIMS, KNOWN OR UNKNOWN, WITH RESPECT TO
THE PHYSICAL OR ENVIRONMENTAL CONDITION OF THE PREMISES OR THE COMPLIANCE OF
THE PREMISES WITH APPLICABLE LAW. TENANT IS RELYING ON ITS OWN INSPECTION AND
REVIEW OF THE PREMISES.

      8. RISK OF LOSS. RISK OF LOSS SHALL REMAIN WITH LANDLORD, SUBJECT TO
TENANT'S OBLIGATIONS UNDER THE LEASE, UNTIL THE CLOSING. IF ANY CONDEMNATION IS
INSTITUTED OR THREATENED AGAINST THE PREMISES OR THE PREMISES ARE DAMAGED,
EITHER PARTY MAY TERMINATE THE PURCHASE TRANSACTION, AND THE LEASE SHALL REMAIN
IN FULL FORCE AND EFFECT.




<PAGE>   19

      9. Tax-Free Exchange. Landlord may conduct the sale as a tax-free
exchange pursuant to Section 1031 of the Internal Revenue Code. Such exchange
shall be conducted through a qualified intermediary, at no cost to Tenant, and
without affecting Landlord's obligations to Tenant. Tenant shall not be
required to take title to any other property in connection with a Section 1031
exchange. Landlord reserves the right to delay closing for up to thirty (30)
days to finalize a 1031 exchange.

      10. Exercise is Irrevocable. Tenant's exercise of the Purchase Option is
irrevocable except as provided herein. Time is of the essence.

      11. Exercise by Tenant or Tenant Affiliate Only. Only the Tenant
originally named herein or a Tenant Affiliate may exercise this Purchase
Option. The Purchase Option is not assignable except to a Tenant Affiliate to
which the Lease is assigned and shall terminate automatically upon any
termination of the Lease other than as a result of default by Landlord.
Further, no such right is exercisable if as of the date of exercised of the
right or the Closing, the Lease has terminated or an Event of Default or event
("Potential Default") which but for the passage of time or the giving of
notice, or both, would constitute an Event of Default has occurred and is
continuing.

      12. Landlord's Right of First Offer If at any time Tenant desires to sell
the Building, d then Tenant, before offering the Building to anyone, shall
offer to Landlord the right to purchase the Building on :3, the same terms and
conditions upon which Tenant intends to offer the Building for sale.

      00 SO Such offer shall be made by Tenant to Landlord in a written notice
(hereinafter called the "First Offer Notice") which offer shall designate the
terms which Tenant intends to offer the Building for sale. Landlord may accept
the offer set forth in the First Offer Notice by delivering to Tenant an
acceptance v (hereinafter called " Landlord's Notice") of such offer within 10
business days after delivery by Tenant of the First Offer Notice to Landlord.
Time shall be of the essence with respect to the giving of Landlord's Notice.
If Landlord does not accept (or fails to timely accept) an offer made by Tenant
pursuant to the provisions of this CD Addendum with respect to the purchase of
the Building, Tenant shall be free to sell the Building to anyone on terms
which may be 95% less favorable to Tenant than those offered to Landlord.

      t I f T Tenant desires to sell the Building to anyone on terms which are
less than 95% of the purchase price offered to Landlord, then Tenant must
reoffer to Landlord the right to purchase the Building 0 on such terms (the
"Second Offer Notice"). Tenant shall deliver to Landlord the Second Offer
Notice in the same manner as the First Offer Notice. If Landlord does not
accept (or fails to timely accept) the re-offer made by Tenant pursuant to the
provisions of this Addendum with respect to the purchase of the Building,
Landlord shall be deemed to have irrevocably waived all further rights under
this Addendum and Tenant shall be under no further obligation to Landlord with
respect to the sale of the Building by reason of this Addendum.




<PAGE>   20

                                  ADDENDUM SIX

                           HVAC MAINTENANCE CONTRACT

                 ATTACHED TO AND A PART OF THE LEASE AGREEMENT
                          DATED ------ , 1999, BETWEEN

                        PROLOGIS LIMITED PARTNERSHIP IV

                                      and

                            STERILE RECOVERIES, INC.

      Per Paragraph 11, captioned "TENANT REPAIRS", is revised to include the
following: a.Tenant agrees to ENTER INTO AND maintain through the term of the
Lease, a regularly scheduled preventative maintenance/service contract for
servicing all hot water, heating and air conditioning systems and equipment
within the Premises. The Landlord requires a qualified HVAC contractor perform
this work. A- CERTIFICATE mi.

      The service contract MUST becomeWITHIN THIRTY (30) DAYS OF OCCUPANCY, and
service visits should be performed on a quarterly basis. THE CONTRACT should
indicate THE TERM 9 SERVICE (PREFERABLY ONE YEAR). We suggest that you send the
following list to a qualified HVAC contractor to be assured that these items
are included in the maintenance contract:

       1) Adjust belt tension;

       2) Lubricate all moving parts, as necessary;

       3) Inspect and adjust all temperature and safety controls;

       4) Check refrigeration system for leaks and operation;

       5) Check refrigeration system for moisture;

       6) Inspect compressor oil level and crank case heaters;

       7) Check head pressure, suction pressure and oil pressure;

       8) Inspect air filters and replace when necessary;

       9) Check space conditions;

      10) Check condensate drains and drain pans and clean, if necessary;

      11) Inspect and adjust all valves;

      12) Check and adjust dampers;

      13) Run machine through complete cycle.

      Landlord accepts that Tenant will handle all of its own maintenance and
repair work "in-house" by qualified employees. Tenant will still be obligated
to provide to Landlord on a quarterly basis a written report showing that all
of the above check list items have been addressed.




<PAGE>   21

                                 ADDENDUM SEVEN
                              MOVE-OUT CONDITIONS
   ATTACHED TO AND A PART OF THE LEASE AGREEMENT DATED 6/15 _, 1999, BETWEEN.
                        PROLOGIS LIMITED PARTNERSHIP IV
                                      and
                            STERILE RECOVERIES, INC

      Per Paragraph 21, Tenant is obligated to check and address, prior to
move-out of the facility, the following items. Landlord expects to receive the
space in a well maintained condition, with normal wear and tear of certain
areas acceptable. The following list is designated to assist you in the
move-out procedures but is not intended to be all inclusive.

      All lighting is to be placed into good working order. This includes
replacement of bulbs, ballasts, and lenses as needed.

       2. All truck doors and dock levelers should be serviced and placed in
good operating order. This would include the necessary replacement of any
dented truck door panels and adjustment of door tension to insure proper
operation. All door panels which are replaced need to be painted to match the
building standard.

       3. All structural steel columns in the warehouse and office should be
inspected for damage. Repairs of this nature should be pre-approved by the
Landlord prior to implementation.

       4. Heating/air-conditioning systems should be placed in good working
order, including the necessary replacement of any parts to return the unit to a
well maintained condition. This includes warehouse heaters and exhaust fans.
Upon move-out, Landlord will have an exit inspection performed by a certified
mechanical contractor to determine die condition.

       5.All holes in the sheet rock walls should be repaired prior to move-out.

       6. The carpets and vinyl tiles should be in a clean condition and should
not have any holes or chips in them. Landlord will accept normal wear on these
items provided they appear to be in a maintained condition. Facilities should
be returned in a clean condition which would include cleaning of the coffee
bar, restroorn areas, windows, and other portions of the space.

       8. The warehouse should be in broom clean condition with all inventory
and racking removed. There should be no protrusion of anchors from the
warehouse floor and all holes should be appropriately patched. If
machinery/equipment is removed, the electrical I lines should be properly
terminated at the nearest junction box.

       9. All exterior windows with cracks of breakage should be replaced.

      10. The Tenant shall provide keys for all locks on the Premises,
including front doors, rear doors, and interior doors.

      11. Items that have been added by the Tenant and affixed to the Building
will remain the property of Landlord, unless agreed otherwise. This would
include but is not limited to mini-blinds, air conditioners, electrical, water
heaters, cabinets, flooring, etc. Please note that if modifications have been
made to the space, such as the addition of office areas, Landlord retains the
right to have the Tenant remove these at Tenant's expense.

      12. All electrical systems should be left in a safe condition that
conforms to code. Bare wires and dangerous installations should be corrected
prior to move-out.

      13. All plumbing fixtures should be in good working order, including the
water heater. Faucets and toilets should not leak.

      14. All dock bumpers must be left in place and well secured.