MODIFIED TRIPLE NET LEASE



Lease Preparation Date:  September 30, 1999

Lessor:           PS Business Parks, L.P., A California Limited Partnership

Lessee:           Epitope, Inc., An Oregon Corporation

Guarantor:
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1.       LEASE TERMS

         1.01      Premises:  The leased Premises  located within the Project as
indicated on Exhibit "A1" contains  Approximately  30,499  rentable square feet.
The address of the leased  Premises is: 8505 S.W.  Creekside  Place,  Beaverton,
Oregon 97008.

         1.02      Building:  The Premises is located in the Building  indicated
on  Exhibit"A-2"  and contains  30,499  rentable  square feet and is part of the
Project.

         1.03      Project:  The Project,  as  indicated  on Exhibit A-3,  which
consists of all  buildings on the  Property,  of which the Premises is a part is
commonly referred to as: Creekside  Corporate Park, Phase 1, Building 6 or 03083
and contains approximately 155,765 Rentable square feet.

         1.04      Property:  The Premises,  the Project,  and all Lessor's land
thereunder or appurtenant thereto as described in Exhibit Property.

         1.05      Lessee's  Notice  Address:  Lessee's  Notice  Address  is the
address  of the  leased  Premises  as  stated in  Paragraph  1.01  above  unless
otherwise specified here: N/A

         1.06      Lessor's Notice Address:  Lessor's Notice Address is: 8905 SW
Nimbus Avenue, Suite 155, Beaverton, OR 97008.

         1.07      Lessee's  Permitted Use:  Lessee and Lessor agree that Lessee
may only use the  Premises for the  following  purpose(s):  General  office use,
research and development, manufacturing, storage, and distribution of products.

         1.08      Lease Term:  The Lease Term commences on February 1, 2000 and
ends on January 31, 2005 (60 months, and 0 days).

         1.09      Base Rent:  During the original term of this Lease, Base Rent
shall be paid  monthly,  in  lawful  money of the  United  States,  the  amounts
specified below, during the applicable periods noted:

Base Rent       Applicable Period

$29,279.00      Beginning    February 1, 2000     Ending       January 31, 2001

$30,194.00      Beginning    February 1, 2001     Ending       January 31, 2002

$31,109.00      Beginning    February 1, 2002     Ending       January 31, 2003

$32,024.00      Beginning    February 1, 2003     Ending       January 31, 2004

$32,939.00                   February 1, 2004                  January 31, 2005

         1.10      Security Deposit:  $22,875.00  payable in lawful money of the
United  States of America  and held by Lessor  from  previous  lease of the same
premises.

         1.11      Lease Documentation Fee: $ None.
<TABLE>
<S>      <C>                                                      <C>              <C>
         1.12       Initial Monthly Rent Charges:  Base Rent      (1.09)           $29,279.00
                                                   CAM            (1.13)           $ 6,099.00*
                                                   Taxes          (1.13)           $ 6,099.00*
                                                   Insurance      (1.13)           $ 6,099.00*
                                                   Total initial monthly payment   $35,378.00
</TABLE>

         1.13      Proportionate  Share:  Lessee's  Proportionate  share  of the
Project, which represents the approximate Proportionate Share of the Premises to
the Project is 19.6%. Lessee's  Proportionate Share of the Building within which
it is located,  which  represents  the  approximate  proportionate  share of the
Premises to the Building is 100%. Proportionate Share may be adjusted during the
Lease Term if the size of the Project, Premises or Building changes.

         1.14      Operating  Expense  Estimate:   Lessee's   Operating  Expense
Estimate is *6,099.00.

         1.15      Broker(s): Mark McFarland, Trammel Crow Company

         1.16      Additional Attachments: Addendums #1-#3, Exhibit A-1, Exhibit
A-2, Exhibit B, Exhibit C, Exhibit D.

*Or the then prevailing rate.

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2.       Letting; Condition; Possession

         2.01      Lessor leases to Lessee,  and Lessee leases from Lessor,  the
Premises, as indicated in Paragraph 1.01 in consideration of Lessee's payment of
Base Rent and other payments  hereunder  subject to all of the terms,  covenants
and  conditions of this Lease and all recorded  matters,  laws,  ordinances  and
governmental  regulations and orders.  Lessee's  possession and occupancy of the
Premises constitutes  Lessee's  acknowledgment that it has satisfied itself with
respect  to the  overall  condition  of the  Premises,  the  present  and future
suitability  of the  Premises  for  Lessee's  intended  use and the  substantial
completion of Lessor constructed Lessee  Improvements,  if any,  consistent with
Paragraph 10 below and specifically set forth in Exhibit "B".

         2.02      Lessee  shall only use the Premises  for its  permitted  use.
Lessee  shall not occupy or use the  Premises or any part thereof for other than
its  permitted use and not for any use or purpose which is unlawful or deemed by
Lessor to be disreputable in any manner or dangerous to life, limb or property.

         2.03      Unless  otherwise  provided  herein,  any statement of square
footage  set forth in this  Lease is an  approximation  which  Lessor and Lessee
agree is  reasonable  for all  purposes  and shall be the basis for this  Lease.
Lessor reserves the right to change Lessee's  proportionate share to reflect any
increase or decrease in the common  area.  Any use of the terms  "rentable"  and
"usable" is for  convenience  only,  and such  descriptions  represent  Lessor's
interpretation  of such terms. If there are no Tenant  Improvements or Exhibit B
is not attached  hereto,  then Lessee accepts the Premises in "AS-IS"  condition
and Lessor  shall have no  obligation  to provide or pay for any repair or other
work therein, except as stated in this Lease.

         2.05      To Lessor's best  knowledge,  all  Lessor-constructed  Lessee
Improvements  on or in the Premises as set forth in Exhibit "B", if any,  comply
with  all  then  applicable   governmental  agency  laws,  codes,   regulations,
ordinances,  covenants and restrictions.  However,  Lessor makes no warranty nor
accepts any responsibility for specifically meeting such compliance presently or
in the future with respect to any Lessee activity, including but not limited to:
a.) any Lessee Improvements or Lessee Alterations, as defined in Paragraph 10.02
below,  made or to be made by  Lessee or at  Lessee's  direction;  b.)  Lessee's
Permitted Use; c.) Lessee's  occupancy of the Premises and/or the Property;  and
d.) the presence of Lessee's employees, agents, contractors, suppliers, invitees
or licensees on or about the Property.

         2.07      Subject  to  Paragraph  10.05  and  Lessor's  right to retain
improvements,  upon  termination  of this  Lease,  Lessee  agrees to return  the
Premises  to  Lessor  in the same  condition  as  received  by  Lessee as of the
original  date Lessor  delivers  the  Premises  to Lessee,  normal wear and tear
excepted.

3.       Base Rent

         3.01      On or  before  the first  day of each  calendar  month of the
Lease Term,  Lessee will pay to Lessor in lawful  monies of the United States of
America,  without deduction or offset,  prior notice or demand, Base Rent at the
place Lessor designates.

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4.       Additional Rent

         4.01      Unless otherwise  specifically  stated, any charge payable by
Lessee  under this  Lease  other than Base Rent is,  called  "Additional  Rent".
Additional  Rent is to be paid  concurrently  with and subject to the same terms
and conditions of Base Rent.  The term "rent"  whenever used in this Lease means
Base Rent,  Additional  Rent and/or any other monies payable by Lessee under the
terms of this Lease. In the event any rent payable under this Lease commences or
ends on a day other than the first day of a calendar month, the actual number of
days in the prorated month will be used as the basis for the calculation.

         4.02      "Operating   Expenses"  as  used  herein  shall  include  all
reasonable  costs  and  expenses,  operation,  maintenance,  and  repair  of the
Premises,  Building,  Project and  Property,  or any part  thereof,  incurred by
Lessor including but not limited to: (1) Property  supplies,  materials,  labor,
equipment, and tools; (2) Lessor-incurred utility and service costs and expenses
(as further described In Paragraph 4.03B below), security,  janitorial,  and all
applicable  service and  maintenance  agreements;  (3) Property  related  legal,
accounting,  and consulting fees, costs and expenses; (4) insurance premiums for
all policies deemed  necessary by Lessor and/or its lenders,  and all deductible
amounts under such policies (as further described in Paragraph 4.03C below); (5)
costs and expenses of operating,  maintaining, and repairing common areas of the
Property, including but not limited to, hallways,  restrooms,  conference rooms,
exercise rooms, equipment and telephone rooms, driving,  parking and other paved
or unpaved  areas  (including  but not limited to,  resurfacing  and  striping),
landscaped  areas  (including  but not  limited to,  tree  trimming),  walkways,
building  exteriors  (including but not limited to,  painting and roof repairs),
signs and directories, and elevators and stairways; (6) capital improvements and
replacements  (including  all financing  costs and interest  charges) which have
been made to improve  the  operating  efficiency  of the  Property;  (7) capital
improvements and replacements (including but not limited to, all financing costs
and Interest  charges)  required by any governmental  authority or law including
but not limited to,  compliance  required under the Americans with  Disabilities
Act of 1990; (8) compensation  (including but not limited to, any payroll taxes,
worker's  compensation for employees,  and customary  employee  benefits) of all
persons,  including  independent  contractors,  who  perform  duties,  or render
services on behalf of, or in connection with the Property,  or any part thereof,
including but not limited to,  Property  operations,  maintenance,  repair,  and
rehabilitation;  (9) Property  management  fees;  (10) Real  Property  Taxes (as
further described In Paragraph 4,03,  below),  provided,  however,  wherever the
Lessee  and/or any other  lessee of space  within the Property has agreed in its
lease or otherwise to provide any item of such services partially or entirely at
its own expense,  or wherever in the Lessor's judgment any such significant item
of  expense is not  incurred  with  respect to or for the  benefit of all of the
space within the Property,  in allocating the Operating Expenses pursuant to the
foregoing  provisions of this  subsection  the Lessor shall make an  appropriate
adjustment,  as  aforesaid,  so as to avoid  allocating to the Lessee or to such
other  lessee  (as the case  may be)  those  Operating  Expenses  covering  such
services already being provided by the Lessee or by such other lessee at its own
expense,  or to avoid  allocating  to all of the net  rentable  space within the
Property those Operating Costs incurred only with respect to a portion  thereof,
as aforesaid.

         4.03A     Real  Property  Taxes" as used herein shall  include any fee,
license,  tax,  late fee,  levy,  charge,  assessment,  penalty  (if a result of
Lessee's  delinquency or  negligence),  or surcharge  (hereinafter  individually
and/or  collectively  referred to as "Tax") imposed by any authority  (including
but not limited to, any federal,  state,  county,  or local  government,  or any
school,  agricultural,  lighting,  drainage,  or other improvement  district, or
public or private  association)  having the direct or indirect  power to tax and
where such Tax is Imposed against the Property,  or any part thereof,  or Lessor
in connection with its ownership or operation of the Property, including but not
limited to: (1) any Tax on Lessor's right to receive, or the receipt of, rent or
income from the Property,  or any part thereof, or Tax against Lessor's business
of  leasing  the  Property;  (2)  any  Tax  by any  authority  for  services  or
maintenance  provided to the Property,  or any part  thereof,  including but not
limited to, fire protection,  streets,  sidewalks, and utilities; (3) any Tax on
real estate or personal  property  levied with respect to the  Property,  or any
part thereof, and any fixtures and equipment and other property of Lessor or the
Property used in connection  with the  operation,  maintenance  or repair of the
Property; (4) any Tax imposed on this transaction,  or based upon a reassessment
of the Property,  or any part thereof,  due to a change in ownership or transfer
of all or part of Lessor's  interest in the  Property,  or any part thereof and,
(5) any Tax  replacing,  substituting  for, or in addition to any Tax previously
included with this definition.  Real Property Taxes do not include: (1) Lessor's
federal  or state  income,  franchise,  inheritance,  or  estate  taxes;  or (2)
Lessee's personal property taxes (taxes charged against Lessee's trade fixtures,
furnishings,   equipment,  or  other  personal  property)  which  are  the  sole
responsibility of Lessee,  and shall be billed directly to, and paid in a timely
manner by Lessee.

         4.03B     "Utility and Service  Costs" as used herein shall include all
Lessor  incurred  utility  and service  costs and  expenses  including,  but not
limited to water,  electricity,  gas,  heating,  lighting,  steam  sewer,  waste
disposal, air conditioning, heating and ventilation.

         4.03C     "Insurance"  as  used  herein  shall  include  all  insurance
premiums  for all  policies  deemed  necessary  by Lessor  and/or  its  lenders,
including  but not  limited to,  worker's  compensation,  liability,  commercial
general liability,  automobile,  rental  interruption  insurance and any and all
additional  endorsements,  extended  coverage,  riders under or attached to such
policies.

         4.04      Throughout the Lease Term, Lessee will pay as Additional Rent
its proportionate share (of the

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Project and/or  building,  as  applicable)  of Operating  Expenses which will be
equal to each calendar  year's total Operating  Expenses  multiplied by Lessee's
Proportionate  Share. in the event Lessee is only responsible for a portion of a
given  calendar  year,  Lessee's  share  will be based on the  actual  number of
elapsed  applicable days. All Operating  Expenses will be adjusted to reflect an
average Project occupancy level of ninety-five percent (95%) during any calendar
year in  which  the  Project  is not at least  eighty  percent  (80%)  occupied.
Operating Expense Estimates and actualized Operating expenses will be determined
as outlined in 4.05A, 4.05B below and subject to the provisions of 4.07.

         4.05      Lessee's  Operating  Expense estimates shall be determined as
follows:

         4.05A     Lessee's Operating Expense  estimates:  On or about April 1st
of each  calendar  year,  Lessor will  provide  Lessee with a statement  of: (1)
Lessee's  annual  share of  estimated  Operating  Expenses  for the then current
calendar year; (2) Lessee's new monthly  Operating Expense estimate for the then
current year; and, (3) Lessee's retroactive estimate correction billing (for the
period of January  1st through the date  immediately  prior to the  commencement
date of Lessee's new monthly  Operating  Expense  estimate)  for the  difference
between Lessee's new and previously  billed monthly  Operating Expense estimates
for the then current year.

                   4.05A(1)  Annual  estimate  share:  Lessee's  annual share of
                   estimated  Operating  Expenses for the then current  calendar
                   year shall be determined by  multiplying  Lessor's  estimated
                   total Operating  Expenses for the then current calendar year,
                   by Lessee's  Proportionate Share (of the Project or Building,
                   as applicable) identified in Paragraph 1.11.

                   4.05A(2) Monthly  Operating  Expense  estimate:  Lessee's new
                   monthly  Operating  Expense  estimate  for the  then  current
                   calendar year shall be calculated by dividing Lessee's annual
                   share of  estimated  Operating  Expenses,  as  determined  in
                   4.05A, above, by 12.

                   4.05A(3) Retroactive  estimate correction:  Lessee's share of
                   the change in  Operating  Expense  estimates  retroactive  to
                   January 1st of each year shall be determined as follows:  For
                   the then current  calendar  year, the total of Lessee monthly
                   Operating  Expense estimates billed prior to the commencement
                   of Lessee's new monthly  Operating  Expense estimate shall be
                   subtracted  from  Lessee's  new  monthly   Operating  Expense
                   estimate  multiplied  by the number of elapsed  months within
                   the same period.

         4.05(B)   Lessee's share of actualized annual Operating Expenses: On or
about  April 1st of each year,  Lessor  will  provide  Lessee  with a  statement
reflecting the total Operating Expenses for the calendar year just ended. If the
total of Lessee's  Operating Expense estimates billed for the calendar year just
ended are less than Lessee's share of the actualized  Operating Expenses for the
calendar  year just ended,  the statement  will indicate the payment  amount and
date due. If Lessee has paid more than its share of  Operating  Expenses for the
preceding  calendar year,  Lessor will credit the overpayment  towards  Lessee's
future Operating Expense obligations.

         4.06      Under  this  Lease,   monthly  Operating  Expense  estimates,
retroactive  estimate  corrections,  and  Lessee's  share of  actualized  annual
Operating  Expenses are considered  Additional Rent.  Monthly  Operating Expense
estimates  are due on the 1st of each  month  and  shall  commence  in the month
specified by Lessor.  Lessee's retroactive  estimate correction,  and actualized
annual Operating Expense charges,  if any, shall be due, in full, on the date(s)
specified by Lessor.

         4.07      Lessee  will be entitled to any  reduction,  refund,  offset,
allowance or rebate should any Real  Property  Taxes be  retroactively  reduced,
credited,  abated or exempted by any direct or indirect taxing authority for any
prior taxation or assessment  period.  If Lessor fails to provide Lessee with an
Operating  Expense statement by April 1st of any calendar year, or elects not to
bill  Lessee  its  share of  actualized  Operating  Expenses,  and/or  Operating
Expenses  estimate(s),  or estimate increase(s) for any period of time, Lessor's
right to bill and  collect  these  charges  from  Lessee at a later  time is not
waived.

         4.08.     Whether now in force or hereafter  in force,  Lessee will pay
as Additional  Rent its share of any duties,  levies or fees  resulting from any
statutes or regulations,  or interpretations  thereof,  enacted by any governing
authority  which pertains to Lessor's or Lessee's use,  ownership,  occupancy or
alteration of the Premises,  Project, or Property, or any part thereof. Lessee's
share of such  duties or fees will be based on Lessee's  Proportionate  Share as
indicated in Paragraph 1.13, or other equitable  method  determined by Lessor in
its sole  discretion.  In the event the Property,  or any part  thereof,  shares
common  Operating  Expenses,  commonly  used  areas,  land or  other  items  not
exclusive to the  Property,  Lessor shall  allocate and bill Lessee its share of
any costs and expenses  attributable  to such sharing on an equitable  basis, as
determined by Lessor in its sole discretion.

         4.09      In the event  Lessee  wishes to audit any Lessee rent charge,
such a  review  shall  be  performed  only  at a time  and  location  designated
reasonably  by  Lessor,  and only if Lessee is not in  Default,  as  defined  in
Paragraph 20.02 below at the time of the audit request and/or at any time during
the course of the audit.  Lessor and Lessee  agree that any Lessee audit must be
conducted  within six (6) months of the date the rent charge becomes due, and if
this audit is not conducted within this period of time,  Lessee's right to audit
is waived, and the rent charge, as originally billed, including all calculations
used as the basis for the Base Year or expense  stop shall be deemed  conclusive
and final for all purposes under this Lease.  If the audit reveals that expenses
are overstated by more than ten percent (10%), Lessor shall reimburse Lessee for
Lessee's out-of-pocket expenses.

         4.10      Limitations  on increase in Expenses:  Controllable  expenses
shall not increase more than five percent (5%) per year.

5.       Late Charges

         Any  installment,  including  any  partial  installment,  of Base Rent,
Additional  Rent, rent or any other rent charge payable which is not received by
Lessor within five (5) days after it becomes due, shall be considered past

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due, and shall  constitute a default per paragraph 20.02 below and Lessee shall,
without the  necessity of  notification  from  Lessor,  pay Lessor a late charge
equal to fifty  dollars  ($50.00)  or ten percent  (10%) of the then  delinquent
amount, whichever is greater. Additionally, a fifty dollar ($50.00) handling fee
will be paid to Lessor by Lessee for each bank returned check which return shall
constitute a Default, and Lessee will be required to make all future payments to
Lessor by money order or cashier's  check.  The  acceptance  of late charges and
returned  check charges by Lessor will in no way constitute a waiver of Lessee's
Default with respect to any overdue  amount nor prevent  Lessor from  exercising
any of its rights or remedies resulting from such late payment.

6.       Security Deposit

         6.01      Lessee has deposited with Lessor an initial  Security Deposit
in the amount  specified  in Paragraph  1.10 as security  for Lessee's  full and
faithful  performance of every  provision  under this Lease.  Lessor will not be
required to keep the Security Deposit separate from its general funds and has no
obligation or liability for payment of interest thereon (except when required by
law).

         6.02      In no event will  Lessee  have the right to apply any part of
the Security Deposit to any amounts payable under the terms of this Lease nor is
it a measure of Lessor's  damages in event of a Default or Breach by Lessee.  If
Lessee fails to pay any rent due herein, or otherwise is in Default or in Breach
of any  provision  of this  Lease,  Lessor  may use,  apply or retain all or any
portion of the Security Deposit for the payment of any amount due Lessor,  or to
compensate  Lessor,  for any loss or damage  suffered  by  Lessee's  Default  or
Breach.  Within ten (10) days after written notification by Lessor,  Lessee will
pay monies to Lessor  sufficient  to restore  the  Security  Deposit to the full
amount required under this Lease.

         6.03      Within  sixty (60) days (or as otherwise  prescribed  by law)
after the  expiration or earlier  termination of the Lease Term and after Lessee
has vacated  the  Premises,  Lessor  will  return to Lessee that  portion of the
Security  Deposit  not used or  applied  by  Lessor  to  fulfill  any and all of
Lessee's obligations under this Lease.

         6.04      At any time during the Lease Term,  within  fifteen (15) days
after written request from Lessor, Lessee shall deliver to Lessor such financial
statements  as Lessor  reasonably  requires to verify the net worth of Lessee or
any  assignee,  subtenant,  or  guarantor of Lessee.  In addition,  Lessee shall
deliver to any lender designated by Lessor any financial  statements required by
such lender to facilitate the financing or  refinancing of the Property.  Lessee
represents  and warrants to Lessor that each  financial  statement is a true and
accurate  statement as of the date of such statement.  All financial  statements
shall be confidential  and shall be used only for the purposes set forth in this
Lease.

7.       USE OF PREMISES; QUIET ENJOYMENT; TRASH

         7.01      The  Premises  will be used and  occupied  only for  Lessee's
Permitted Use, as described in Paragraph  1.07.  Lessee agrees it has negotiated
its  Permitted  Use in a fair and  reasonable  manner and,  as so  written,  the
Permitted Use is enforceable for all purposes under this Lease. Further,  Lessee
expressly  waives the right to  challenge  the  validity of its  Permitted  Use,
including  but not limited to, as defined in  Paragraph  20.  below,  challenges
which pertain to Default or Breach of this Lease, mitigation of damages, and any
and all Transfers under this Lease.

         7.02      Lessee will comply with all  conditions and covenants of this
Lease,  and  all  applicable  governmental  agency  laws,  codes,   regulations,
ordinances,  covenants  and  restrictions  affecting  the  Property  or any part
thereof.  Lessee will not use or permit the use of the Premises, the Property or
any part thereof,  in a manner that is unlawful,  diminishes  the  appearance or
aesthetic  quality of any part of the  Property,  creates  waste or a  nuisance,
disturbs Lessor, other lessees or any neighboring property occupants,  or causes
damage to the Property,  or any part thereof,  or to any  neighboring  property,
personal property or person.  Any animals,  excepting guide dogs or animals used
in Lessee's research, on or about the Property or any part thereof are expressly
prohibited.

         7.03      Lessor  agrees  that so long as  Lessee  performs  all of its
obligations under the Lease, Lessee's possession, quiet enjoyment and use of the
Premises for the term of the Lease will not be disturbed by Lessor, subject only
to the provisions of the Lease.

         7.04      Lessee  shall  be   responsible   for   providing  all  trash
receptacles and pickup for its premises.  In the event of any excessive trash in
or  outside  Lessee's  premises,  as  determined  by  Lessor  in its  reasonable
discretion,  Lessor will have the right to remove such excess trash,  charge all
costs and expenses  attributable to its removal to Lessee, and require Lessee to
obtain, at its sole cost and expense, additional trash receptacles, to be placed
in a  location  designated  by  Lessor  for  Lessee's  specific  use.  Under  no
circumstances may any "Hazardous  Materials",  as defined in Paragraph 14 below,
any  materials  not  permitted by law,  any  materials  improperly  or illegally
handled, stored, contained or released, or any materials which are not permitted
by Lessor,  as  determined in its sole  discretion,  be disposed of in any trash
receptacles located in or about the Property. Lessee will not cause, maintain or
permit  any  outside  storage on or about the  Property  without  prior  written
consent by Lessor,  which consent,  if given, may be revoked at any time. In the
event of any unauthorized outside storage by Lessee, Lessor will have

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the right,  without notice, in addition to such other rights and remedies it may
have, to remove any such storage and charge all direct and associated  costs and
expenses to Lessee.

8.       PARKING

         All parking will comply with the terms and conditions of this Lease and
the parking criteria set forth in Exhibit "D". Unless otherwise stated,  Lessee,
its employees, agents, contractors,  suppliers, invitees and licensees will have
a  non-exclusive  privilege,  in conjunction  with Lessor,  other lessees of the
Property,  and such other persons as Lessor may designate,  to use those parking
spaces  designated  by Lessor  for  public  parking.  Vehicles  parked in public
parking areas will be no larger than full-sized passenger automobiles or pick-up
trucks.  Larger  vehicles,  if permitted  in writing by Lessor,  will be parked,
loaded and  unloaded in  locations  designated  by Lessor.  Lessor  reserves the
right,  with notice to Lessee, to tow away at Lessee's sole cost and expense any
vehicles  parked in any parking  area for any  continuous  period of 24 hours or
more, or earlier If Lessor,  in its sole discretion,  determines such parking to
be a hazard or inconvenience to other lessees or Lessor,  upon written notice to
Lessee,  or  violates  any rules or  regulations  or posted  notices  related to
parking.  Lessor shall not be responsible for enforcing  Lessee's parking rights
against  third  parties.  From time to time,  Lessor  reserves  the right,  upon
written notice to Lessee, to change the location, the availability and nature of
parking  spaces,  establish  reasonable  time  limits  on  parking,  and,  on an
equitable  basis,  assign specific spaces without charge to Lessee as Additional
Rent.

9.       UTILITIES

         9.01      Lessor  agrees to  provide  at its cost  water  and  electric
service  connections  (and gas where  applicable)  to the Premises and telephone
service connections to the Building,  but Lessee agrees to make all arrangements
for and pay directly to the  appropriate  utility company all costs and expenses
of utility  services  supplied  to,  and for the use of,  Lessee in or about the
Premises,  including  but not  limited  to,  water,  gas,  heat,  light,  power,
telephone,  sewer,  sprinkler charges,  usage costs and expenses,  service fees,
connection charges, deposits and any duties or taxes for such utilities.

         9.02      If for any  reason,  Lessor  incurs  any  utility  costs  and
expenses  which are  attributed to Lessee,  as reasonably  determined by Lessor,
Lessee,  upon notification from Lessor,  shall immediately  reimburse Lessor for
all such costs and expenses.

         9.03      In the event it is not  possible  for Lessee to pay  directly
for any utility service,  may, at Lessor's  discretion,  be obtained in Lessor's
name, and Lessee will pay Lessor, as Additional Rent,  Lessor's best estimate of
Lessee's  share of such utility costs and expenses.  Lessor's best estimate will
be  determined  by Lessor in its  reasonable  discretion  and will be subject to
change as Lessor deems  necessary.  Periodically  during the Lease Term,  Lessor
will compare  Lessee's  utility  estimates to actual  utility costs and expenses
incurred,  and  bill  or  credit,  whichever  is  applicable,   Lessee  for  any
difference.  Lessor reserves the right to separately  meter any such service not
so  separately  metered at Lessee's sole cost and expense at any time during the
Lease Term,  at which time Lessee shall be directly  responsible  for payment of
such expense directly to the utility service provider, if possible.

         9.04      Lessor will not be liable or deemed in Default or Breach, nor
will there be any  abatement  of rent,  for any  interruption  or  reduction  of
utilities,  utility  services  or  telecommunication  services  except  for  any
interruptions  solely and directly caused by Lessor.  Additionally Lessee agrees
to comply with any energy conservation  programs implemented by Lessor by reason
of enacted laws or ordinances, or otherwise.

         9.06      By  execution  of  this  Lease,  Lessee  acknowledges  it has
satisfied itself as to the adequacy of any Lessor owned telephone equipment,  if
any, and the quantity of telephone lines and service connections to the Building
available for Lessee's use. Should Lessee require additional equipment, lines or
wiring,  beyond the Initial  installation  of the outside  line to the  building
itself,  any and all  associated  costs and  expense  will be borne  directly by
Lessee and be  subject to the  provisions  of this  Lease and  Lessor's  written
approval.  Additionally  prior to termination of this Lease,  Lessee at its sole
cost and  expense,  will  remove all  telecommunications  and  computer  related
equipment, installed after February 1, 2000, both above and below the ceiling to
the phone close where  applicable,  (if required by Lessor),  including  but not
limited to, all lines,  wiring and all telephone  boards belonging to Lessee and
restore the Premises to the same condition as before such installation.

         9.07      Lessee   acknowledges   and   agrees   that  the  number  and
installation  of  telephone  lines to its  Premises,  including  any  telephone,
telecommunication or other communication  equipment  (specifically including any
antennas,  towers  {microwave or otherwise} or other  exterior  equipment of any
nature)  which  either  utilizes  telephone or  telecommunications  equipment or
technology or in any other manner which adversely  affects  Lessor's  ability to
provide  telephone  or  communications  facilities  to the Project is subject to
Lessor's approval, which will not be unreasonably withheld. Additionally, in the
event  that  Lessee  wishes  additional  telephone,  telecommunication  or other
communication  lines or access  after  the date of  Lessee's  execution  of this
Lease,  no such  additional  lines  or  access  shall  be  permitted  nor  other
telephone,   telecommunication  or  communication  related  equipment  installed
without first  securing the prior written  consent of Lessor,  which will not be
unreasonably withheld.  Any telecommunications  installation shall be subject to
the following:

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(1) Lessor  shall  incur no  expense  whatsoever  with  respect to any aspect of
Lessee's need for additional access or equipment,  including without limitation,
the costs of installation, consultants, materials, permits, service, etc.

(2) Prior to the  commencement  of any work in or about the  Building to install
such additional access, lines or equipment,  Lessee shall agree to abide by such
rules and regulations, as reasonably determined by Lessor.

(3) Lessor reasonably  determines that there is sufficient space in the Building
for the placement of all of the lines, access and equipment.

(5) Any other requirements Lessor may deem reasonable.

The refusal of Lessor to consent to any request shall not be deemed a Default or
Breach by Lessor of its  obligation  under  this  Lease nor be  grounds  for any
termination or offset by Lessee. Lessee agrees that to the extent service by any
telephone or communication equipment is interrupted, curtailed, or discontinued,
except for any interruptions solely and directly caused by Lessor;  Lessor shall
have no  obligation or liability  with respect  thereto and it shall be the sole
obligation of Lessee at its expense to obtain substitute service,  but only with
Lessor's prior written  permission,  which shall not be  unreasonably  withheld.
Lessor's  consent  under  this  section  shall  not  be  deemed  a  warranty  or
representation by Lessor as to the availability or suitability of the present or
future  telephone or  communications  equipment,  connections,  compatibility or
space available for any additional equipment, lines or access. The provisions of
this clause may be enforced solely by the Lessee and Lessor, and are not for the
benefit of another  party,  specifically,  without  limitation,  no telephone or
telecommunications  provider  shall be deemed a third party  beneficiary  of the
Lease.

10.      LESSEE IMPROVEMENTS; LESSEE ALTERATIONS AND MECHANIC'S LIENS

         10.01     Any  improvements  constructed  under this Lease on behalf of
Lessee or at Lessee's expense prior to Lessor's initial delivery of the Premises
are  referred  to  throughout  this Lease as "Lessee  Improvements".  All Lessee
Improvements  will be  performed  in  accordance  with the terms and  conditions
outlined in Exhibit "B". Upon substantial  completion,  as determined by Lessor,
of the Lessee  Improvements  outlined in Exhibit "B", Lessor will be relieved of
any further obligation to alter,  change,  decorate or improve the Premises,  or
any part thereof.

         10.02     Lessor's   prior   written   consent  is  required   for  any
alterations greater than $2,500: (a) Lessee constructed Lessee Improvements; and
(b) any alterations,  utility  installations,  additions,  or other improvements
made by Lessee, at its sole cost and expense, after Lessor's initial delivery of
the  Premises  (hereafter  collectively  referred  to  as  Lessee  Alterations).
Lessor's  consent  will be  conditioned  upon  its  approval  of:  (i)  Lessee's
contractor(s);   (ii)  detailed   plans  and  work   specifications   of  Lessee
Alterations; and (iii) certificates of insurance from Lessee's contractor(s) for
commercial general liability, automobile liability and property damage insurance
with limits not less then $2,000,000 / $250,000 / $500,000 respectively endorsed
to show Lessor as an additional  insured evidencing  Lessor's  requirement to be
notified  at least  thirty  (30) days in advance of any  change,  expiration  or
cancellation  of any  such  policies  along  with  proof of a  current  worker's
compensation  policy. In addition,  Lessee must obtain all approvals and permits
required by any and all  governmental  authorities  and  provide  same to Lessor
prior to commencement of any work, and after work commences must comply with all
conditions  of such  approvals  and  permits  and  perform  work in a prompt and
expeditious manner with good and sufficient  materials.  Lessor also retains the
right, as a condition of its consent, to require Lessee to provide Lessor with a
lien and  completion  bond in a form  acceptable to Lessor in an amount equal to
one  and  one-half  times  the  estimated  cost  of  Lessee  constructed  Lessee
Improvements  and Lessee  Alterations  and/or  require the inclusion of Lessor's
non-responsibility  language  in all  contracts  In a form  approved  by Lessor.
Lessee will give Lessor a minimum of fifteen (15) days prior  written  notice to
the  commencement  of any  Lessee  constructed  Lessee  Improvements  and Lessee
Alterations  to  allow  Lessor  sufficient  time in  which  to post  notices  of
non-responsibility  or no  liability  for work then in progress in, on, or about
the  Premises  as  provided  by  law.  Upon  completion  of  any   improvements,
alterations or additions, Lessee shall deliver to Lessor accurate,  reproducible
as-built plans of such  construction.  For purposes of this paragraph  only, (a)
and (b) shall be defined as those legally requiring a permit.

         10.03     Lessor's   approval   of  any   Lessee   constructed   Lessee
Improvements and Lessee Alterations will not create any liability  whatsoever on
the part of Lessor. By way of example and without limitation,  Lessor's approval
of Lessee's plans and work  specifications will not create any responsibility or
liability  on  the  part  of  Lessor  for  their  sufficiency,  completeness  or
compliance with any and all governmental laws, codes,  regulations,  ordinances,
covenants and restrictions (including without reservation any and all provisions
of the Americans with  Disabilities  Act of 1990 applicable to the Property,  or
any part thereof).

         10.04     Lessee will pay when due, all claims for services,  labor and
materials furnished by, or at the request of Lessee,  including any claims which
are  secured  by any  mechanic's  or  materialmen's  or other lien  against  the
Property, or any interest therein.  Lessee agrees that should any lien be posted
on the Property  due to work  performed,  materials  furnished,  or  obligations
incurred by Lessee, or its employees, agents, contractors,  suppliers,  invitees
or licensees,  Lessee will immediately  notify Lessor and proceed to remove such
lien.  Lessee  further  acknowledges  that it will  remain  liable to Lessor and
indemnify Lessor for any costs and expenses or damages to Lessor or the Property
or any interest therein as a result of such lien(s).  If Lessee,  in good faith,
contests the  validity of any such lien,  claim or demand,  Lessee will,  at its
sole expense,  defend and protect itself,  Lessor and the Property,  or any part
thereof.  To ensure  such  protection  of Lessor and the  Property  and any part
thereof, Lessor

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may, at its sole  option,  require  Lessee to provide  Lessor with a surety bond
satisfactory  to Lessor in an amount  deemed  appropriate  by Lessor  which will
indemnify  Lessor  against any liability  and ensure the  Property,  or any part
thereof,  is free from the effect of such a lien or claim.  In addition,  Lessor
may require Lessee to pay all reasonable  legal fees of Lessor's  attorney(s) of
choice and any other associated costs and expenses should Lessor decide it Is In
its best interest to participate in such an action.  If Lessee fails to keep the
Property,  or any part thereof,  free from any lien or provide a Lessor approved
surety bond,  then,  in addition to any other  rights and remedies  available to
Lessor, Lessor may take any action necessary to discharge such a lien, including
but not limited to,  payment to the claimant on whose behalf the lien was filed,
and regardless of the corrective  action taken by Lessor,  Lessee will be liable
to Lessor  for all costs and  expenses  of such  action to  discharge  the lien,
including, but not limited to, any reasonable legal fees and costs.

         10.5      All Lessee  Improvements  and Lessee  Alterations are part of
the realty and belong to Lessor.  As a  condition  of Lessor  consenting  to any
Lessee  Improvements  or Lessee  Alterations,  Lessor reserves the right, at the
time  consent is sought to: (i) require  Lessee to pay an amount  determined  by
Lessor to cover the costs of demolishing part or all of any Lessee  Improvements
or  Lessee  Alterations  and or the  cost of  returning  the  Premises  to their
condition  before any such work commenced  (normal wear and tear  excepted);  or
(ii)  elect to make  Lessee  the owner of all or any  specified  part and,  upon
termination  of this Lease,  require  Lessee to remove same at its sole cost and
expense.  The provisions of this Paragraph shall survive the termination of this
Lease.

         10.06     Lessee may,  without  prior written  consent of Lessor,  make
non-structural   installations  within  the  Premises  of  its  trade  fixtures,
equipment,  and machinery in conformance  with all applicable  governing  agency
laws, codes, regulations,  ordinances,  covenants and restrictions, and they may
be removed upon  termination of this Lease provided the Premises are restored to
its condition at the  commencement  of this Lease and no material  damage to the
Premises  will occur.  All such  installations  shall be made by a licensed  and
bonded contractor,  approved by Lessor,  with all permits obtained when required
by law.

         10.07     Lessor retains the right to construct or permit  construction
of improvements,  and/or Lessee Alterations, for new and existing lessees and to
alter any commonly used areas in or about the Property. Notwithstanding anything
which may be contained in this Lease,  Lessee  understands  this right of Lessor
and agrees that such  construction will not be deemed to constitute a Default or
a Breach of this Lease by Lessor.  Lessee  waives any such claims which it might
have arising from such construction. Lessor will not unreasonably interfere with
Lessee's enjoyment of the leased premises.

11.      REPAIRS

         11.01     This is a net  lease.  Lessee  will,  at all times and at its
sole cost and expense, keep all parts of the Premises, interior and exterior, in
good order,  condition and repair,  and all equipment and  facilities  within or
serving the  Premises,  including but not limited to:  windows,  glass and plate
glass,  doors and  office  entry(s),  walls and  finish  work,  floors and floor
coverings,   interior  of  the  roof,  heating  and  air  conditioning  systems,
electrical systems,  dock boards, truck doors, chain link gates and fences, dock
bumpers, life  safety-sprinkler  systems,  signage,  plumbing work and fixtures,
termite and pest extermination, regular removal of trash and debris, keeping the
parking  areas,  driveways,  alleys  and  whole of the  Premises  in a clean and
sanitary condition.  The cost of maintenance and repair of any common party wall
(any wall,  divider,  partition or other structure  separating the premises from
any adjacent  premises  occupied by other  Lessees)  shall be shared  equally by
Lessee and the lessee occupying the adjacent  promises.  Lessee shall not damage
any party wall or disturb the integrity  and support  provided by any party wall
and shall, at its sole cost and expense, promptly repair any damage or injury to
any party wall caused by Lessee or its  employees,  agents or  invitees.  Lessee
will keep the  Premises  and every part  thereof in good  order,  condition  and
repair regardless of whether any portion of the Premises requiring  repairs,  or
the means of repairing same are reasonably or readily accessible.  Additionally,
Lessee shall be  obligated to maintain and repair the Premises  whether the need
for such repairs or  maintenance  occurs as a result of Lessee's  use, any prior
use, vandalism, acts of third parties, Force Majeure or the age of the Premises.
The standard for  comparison of condition  will be the condition of the Premises
as of  Lessee's  initial  occupancy  of the  Premises  and  failure to meet such
standard  shall create the need to repair.  All Lessee repairs will be made by a
licensed and bonded contractor,  approved by Lessor,  with permits and any other
governmental  agency  approvals  and  requirements  obtained and  observed,  and
conform to all requirements of Paragraph 10.02 herein.  Lessor's maintenance and
repair obligations are limited to facilities and areas used in common with other
lessees,  exterior walls,  foundations and exterior roofs which Lessor agrees to
repair and maintain on behalf of Lessee unless such repairs are due to negligent
or intentional acts of Lessee or its employees, agents, contractors,  suppliers,
invitees or licensee.

         11.02     Lessee  expressly  waives the benefit of any statute or other
legal right now or hereafter in effect which would  otherwise  afford Lessee the
right to make  repairs at  Lessor's  expense,  whether by  deduction  of rent or
otherwise,  or to terminate  this Lease because of Lessor's  failure to keep the
Property,  or any part thereof in good order,  condition  and repair.  If Lessee
does  not  keep  the  Premises  in  good  order,  condition,  conforming  to and
consistent with  Lessor-specified  standard  colors,  materials and quality,  or
fails to make any Lessor  required  maintenance or repairs,  Lessor reserves the
right to perform such obligations of Lessee on Lessee's behalf,  and Lessee will
reimburse  Lessor  for any  direct  and  indirect  costs and  expenses  incurred
immediately  upon  demand.  Failure by Lessee to pay for such costs and expenses
within  five (5) days of  written  notification  by  Lessor  is a Breach of this
Lease.

         11.03     In the event the Premises  constitute a portion of a multiple
occupancy building, Lessor shall

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perform the roof,  paving,  and  landscape  maintenance,  exterior  painting and
common  sewage line  plumbing  which are  otherwise  Lessee's  obligation  under
Subsection  11.01 above,  and Lessee shall, in lieu of the obligations set forth
under  Section  11.01  above  with  respect  to such  items,  be liable  for its
Proportionate  Share of the  Building  (as defined in Section 1.13 above) of the
costs and expense of Building  maintenance  and the care for the grounds  around
the Building, including but not limited to, the mowing of grass, care of shrubs,
general  landscaping,  maintenance of parking areas,  driveways and alleys, roof
maintenance,  exterior  repainting and common sewage line;  plumbing;  provided,
however,  that Lessor  shall have the right to require  Lessee to pay such other
reasonable  proportion for said mowing, shrub care and general landscaping costs
as may be determined by Lessor in its sole discretion, and further provided that
if  Lessee  or any  other  particular  lessee  of the  Building  can be  clearly
identified  as being  responsible  for  obstruction  or  stoppage  of the common
sanitary  sewage line,  then  Lessee,  if Lessee is  responsible,  or such other
responsible  lessee,  shall  pay  the  entire  cost  thereof,  upon  demand,  as
Additional Rent.

         11.04     Lessee  shall,  at its  own  cost  and  expense,  enter  into
regularly  scheduled   preventative   maintenance/service   contract(s)  with  a
maintenance  contractor for servicing all heating and air  conditioning  systems
and equipment  within the Premises and shall  provide  Lessor with copies of all
quarterly  preventative  maintenance service reports. The maintenance contractor
and contract must be reasonably  approved by Lessor.  The service  contract must
include  all  services  suggested  by  the  equipment  manufacturer  within  the
operation/maintenance  manual  and must  become  effective  (and a copy  thereof
delivered to Lessor) within thirty (30) days of the date Lessee takes possession
of the  Premises.  Each Lease year Lessor,  at its option,  may inspect the HVAC
system to determine that the aforementioned  maintenance is being performed.  If
the HVAC system is not being  maintained  pursuant to this Section,  Lessor will
send notice of such lack of  maintenance  to Lessee and Lessee shall  thereafter
have thirty (30) days to perform the necessary maintenance. Failure by Lessee to
complete  the  necessary  maintenance  in such thirty (30) day period shall be a
material  Event of Default and Lessor shall have the right to cure such Event of
Default.  Should the  inspection  demonstrate a lack of  maintenance of the HVAC
system,  Lessee  shall pay for the cost of such  inspection.  Thirty days before
Lessee vacates the Premises,  Lessor will have the HVAC equipment inspected by a
qualified HVAC mechanic at Lessor's  expense.  If, in the reasonable  opinion of
the HVAC mechanic,  taking into account the age of the equipment,  the equipment
has not been properly  maintained,  then Lessor may authorize  necessary repairs
and/or replacements to be made to the system. Such repairs will be deducted from
the Lessee's  Security  Deposit.  Lessee shall reimburse  Lessor for any and all
costs  associated  with such  repairs  which  exceed the amount of any  Security
Deposit.  The remainder of the Security  Deposit,  if any,  shall be refunded to
Lessee in accordance with the terms of the Lease.

12.      INSURANCE

         12.01     Except as expressly provided as Lessee's Permitted Use, or as
otherwise  consented  to by  Lessor  in  writing,  Lessee  will not do or permit
anything to be done  within or about the  Premises  or the  Property  which will
increase  the existing  rate of any  insurance on any portion of the Property or
cause the  cancellation  of any  insurance  policy  covering  any portion of the
Property.  Lessee will not keep,  use or sell, or permit anyone to keep,  use or
sell, anything in or about the Premises, which may be prohibited by the standard
form of fire and other  insurance  policies.  Lessee will,  at its sole cost and
expense, comply with any requirements of any insurer of Lessor and of Lessee.

         12.02     Lessee  agrees to  maintain  In full  force and effect at all
times during the Lease Term, at its sole cost and expense, for the protection of
Lessee and Lessor, policies of insurance which afford the following coverage:
<TABLE>
<S>      <C>       <C>                           <C>
         (a)       Worker's Compensation         Statutory Requirements
                   Employer's Liability          Not less than $1,000,000.00
         (b)       Commercial General Liability  Not less than $1,000,000.00 per occurrence
                                                 Not less than $2,000,000.00 aggregate this location
Commercial  policies shall insure on an occurrence  and not a claims-made  basis
and cover the premises,  project and property.  The policy shall cover liability
arising from premises, operations,  independent contractors,  products-completed
operations,  personal injury,  advertising injury and liability assumed under an
insured contract and not be excess, nor exclude pollution or  employment-related
practices.
         (c)       Automobile Liability          Not  less  than   $300,000.00   combined   single  limit
                                                 including property damage
</TABLE>
         (d)       "All Risk"  coverage  including  fire and extended  coverage,
vandalism,  malicious  mischief and any other perils normally  covered  therein.
This  insurance  coverage  must be upon the Premises  and all property  owned by
Lessee,  for which Lessee is legally liable,  or which is made at the expense of
or at  the  request  of  Lessee,  including  but  not  limited  to,  any  Lessee
Improvements, Lessee Alterations,  furniture, fixtures, equipment, installations
and any other personal property of Lessee, in an amount not less than their full
replacement value, and with a deductible not to exceed $1,000.00 per occurrence.
All proceeds of this insurance shall only be used for the repair and replacement
of property so insured,  and Lessee  hereby  assigns to Lessor all Its rights to
receive  any  proceeds of such  insurance  policies  attributable  to any Lessee
Improvements and Lessee Alterations.

The limits of the insurance  coverage  required  under this Lease will not limit
the  liability of Lessee nor relieve  Lessee of any  obligation  hereunder.  All
insurance to be carried by Lessee will be primary to, and non-contributory  with
Lessor's  insurance,  and  contain  cross-liability  endorsements  and  will  in
addition to the above coverage  specifically insure Lessor against any damage or
loss that may result either directly or indirectly from any breach or default of
Lessee under Paragraph 14 (Hazardous  Materials)  herein.  Any similar insurance
carried by Lessor will be considered excess insurance only.

         12.03     Lessee  will name  Lessor  (and,  at  Lessor's  request,  any
Mortgagee) and each of its officers,

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subsidiaries,   partners,  officers,  directors,  and  employees  as  additional
insureds on all insurance  policies  required of Lessee under this Lease,  other
than  Worker's   Compensation   and  Fire  and  Extended   coverage  (except  on
improvements or alterations to Lessees' Premises for which Lessor shall be named
an additional  insured).  Such insurance policies carried by Lessee will include
an express waiver of  subrogation by the insurer in favor of Lessor,  permit the
insured,  prior to any loss,  to agree with a third  party to waive any claim it
might have against said third party without  invalidating the coverage under the
insurance  policy,  and will release  Lessor and any of its agents and employees
from any claims for damage to any person,  to the Property of which the Premises
are a part, any existing  improvements,  etc.,  Lessee  Improvements  and Lessee
Alterations  to  the  Premises,  and  to  any  furniture,  fixtures,  equipment,
installations  and any other personal  property of Lessee caused by or resulting
from,  risks  which are to be  insured  against  by  Lessee  under  this  Lease,
regardless of cause, except for grossly negligent or intentional acts by Lessor.
Lessee's  failure to provide  evidence of this  required  insurance  coverage to
Lessor shall constitute a Default under this Lease, and Lessee's failure, at any
time  during  the Lease  Term,  to  maintain,  in full  force and  effect,  this
coverage, as required,  shall constitute a Breach under this Lease. See Addendum
1.

         12.04     Lessee will deliver to Lessor,  (and, at Lessor's request any
Mortgagee,  Assignee or  Receiver)  simultaneously  with its  execution  of this
Lease,   (and  thereafter  at  least  thirty  (30)  days  prior  to  expiration,
cancellation  or change  in any  Lessor  required  certificates  of  Insurance),
certificates of insurance  evidencing,  at a minimum,  the coverage specified in
Paragraph  12.02.  All  insurance  required  hereunder  will be  with  companies
licensed  and  authorized  to do business in the state in which the  Property is
located and holding a "General  Policyholders Rating" of "A-, VII" or better, as
set forth In the most current BEST'S INSURANCE GUIDE.

         12.05     If Lessee does not meet the  insurance  requirements  of this
Lease, Lessor will secure and maintain, at Lessee's expense,  insurance coverage
in such  limits as Lessor may deem  reasonable  in its sole  judgment  to afford
Lessor adequate protection. Lessor's coverage, where applicable, will contain an
express waiver of subrogation.

         12.06     Lessor makes no  representation  that the insurance  policies
and coverage amounts specified to be carried by Lessee or Lessor under the terms
of this Lease are adequate to protect  Lessee,  and in the event Lessee believes
that such insurance is  insufficient,  Lessee will provide,  at its own expense,
such additional insurance as Lessee deems adequate.

         12.07     As  to  any  insurance  proceeds  received  by  Lessor,  such
proceeds shall for all purposes be deemed Lessor's sole property,  free from any
claims of Lessee, and unless otherwise stated,  available for Lessor's exclusive
use as it may alone determine in the exercise of its sole discretion.

                                                                       [INITIAL]

13.      INDEMNIFICATION AND WAIVER OF CLAIMS

         Except due to the gross negligence of Lessor,  Lessee waives all claims
against  Lessor for any damage to any  property in or about the Property and for
injury to any persons, including death resulting therefrom,  regardless of cause
or time of occurrence.  Lessee will indemnify, protect, defend and hold harmless
Lessor from and  against  all  claims,  losses,  damages,  costs,  expenses  and
liabilities,  including legal fees, arising out of, involving,  or in connection
with  Lessee's  occupancy  of  the  Premises,  presence  on  the  Property,  the
conducting of Lessee's business and any act, omission or neglect of Lessee,  its
agents, contractors,  employees, suppliers, licensees or invitees except for any
damage or injury which is the direct result of the gross or intentional  acts by
Lessor, its agents, contractors, employees, suppliers, licensees or invitees. In
the event any  action or  proceeding  is brought  against  Lessor,  its  agents,
contractors,  employees,  suppliers,  licensees  or  invitees,  by reason of the
foregoing,  Lessee,  upon  notice by Lessor,  will  defend  Lessor,  its agents,
contractors,  employees, suppliers, licensees or invitees, at Lessee's sole cost
and expense,  and by counsel  reasonably  satisfactory to Lessor.

14.      HAZARDOUS MATERIALS

         14.01     For purposes of this Lease,  "Hazardous  Materials" will mean
any product,  substance,  chemical,  material or waste whose  presence,  nature,
quantity   and/or   intensity  of   existence,   use,   manufacture,   disposal,
transportation,  spill,  release or effect,  either by itself or in  combination
with other materials  expected to be on the Property,  now or in the future,  is
either: (i) potentially  injurious to the public health,  safety or welfare, the
environment or the Property, or any part thereof, (ii) regulated or monitored by
any governmental  authority;  or (iii) a basis for potential liability of Lessor
to any governmental  authority or third party. Hazardous Materials will include,
but not be limited to, solvents,  petrochemical  products,  flammable materials,
explosives, asbestos, urea formaldehyde,  PCB's,  chlorofluorocarbons,  freon or
radioactive materials.  Lessor,  however, grants Lessee permission to keep small
amounts of  materials or  substances  in the Premises  which are  necessary  for
Lessee's normal business  operations.  Lessee agrees to provide Lessor, prior to
its occupancy of the Premises,  a list of all  materials and  substances,  their
locations within the Premises, and methods of storage.  Lessee further agrees to
comply with all future  requests for  information  by Lessor  including  but not
limited to copies of all applicable Material Safety Data Sheets (MSDS sheets).

         14.02     Lessee  shall:  (1) use such  Hazardous  Material  only as is
reasonably necessary to Lessee's business,  in properly labeled quantities;  (2)
handle,  use,  keep,  store,  and dispose of such  Hazardous  Material using the
highest  accepted  industry  standards  and in  compliance  with all  applicable
regulatory  agencies and  governmental  Hazardous  Materials  requirements;  (3)
maintain at all times with Lessor a copy of the most current MSDS sheet for each
such Hazardous Material; and (4) comply with such other

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rules and requirements Lessor may from time to time impose.
                                                                       [INITIAL]

         14.03     Lessee will comply  with all  federal,  state and local laws,
ordinances, and rules and regulations relating to Hazardous Materials, including
but not limited to, current rules and regulations or levels and standards as set
from time to time by the Environmental Protection Agency, the U. S. Occupational
Safety and Health  Administration,  or any other governmental  agency. It is not
necessary  that any  presence  or  contamination  of the  Premises  reflect  any
government mandated threshold or quantity in order for Lessor to take any action
under this paragraph 14.  Notwithstanding  the  foregoing,  Lessee will have the
right to bring, store, and use hazardous materials and controlled  substances on
the premises in its business  operations  without the Lessor's  prior consent in
each specific  instance,  provided that Lessee complies with the requirements of
Section 12 and 14 of this Lease.

         14.04     Upon expiration or earlier  termination of this Lease, Lessee
will, at Lessee's sole cost and expense,  cause all Hazardous  Materials brought
on the  Property  by Lessee,  its  agents,  contractors,  employees,  suppliers,
licensees or invitees,  to be removed from the Property in  compliance  with any
and all applicable  Hazardous  Material  disposal laws. If Lessee or its agents,
contractors,   employees,   suppliers,   licensees  or  invitees,  violates  the
provisions of this Section 14, or performs any act or omission, or contaminates,
or expands the scope of contamination of the Premises, the Property, or any part
thereof,  the  underlying  groundwater,  or any  property  adjacent  to Lessor's
Property, then Lessee will promptly, at Lessee's expense, take all investigatory
and/or remedial action (collectively called  "Remediation") that is necessary to
clean up, remove and dispose of such Hazardous  Materials and any  contamination
so  caused  in  compliance  with  any  applicable  Hazardous  Material  laws and
regulations.  Lessee will also repair any damage to the  Premises  and any other
affected  portion(s) of the Property caused by such Hazardous Material presence,
investigation and Remediation.

         14.05     With respect to any Remediation of the Premises, the Property
or any portion  thereof,  Lessee will  provide  Lessor  with  written  notice of
Lessee's intended Remediation,  including Lessee's method, time and procedure of
Remediation,  and Lessor  will have the right to require  reasonable  changes in
such method,  time or procedure  before Lessee  commences any such work.  Lessee
will not commence any  Remediation  of Hazardous  Materials in any way connected
with the Property,  or any portion thereof,  without first notifying  Lessor, in
writing,  of Lessee's  intention to do so and affording Lessor ample opportunity
to appear,  intervene or  otherwise  appropriately  assert and protect  Lessor's
interest.

         14.06     Lessee  will  immediately  notify  Lessor in  writing  of any
governmental or regulatory action  threatened,  any claim,  demand, or complaint
made or threatened by any person  against  Lessee or any portion of the Property
relating to damage, contribution,  cost recovery compensation, or loss or injury
resulting from any Hazardous Materials,  and any report made to any governmental
authority  arising  out of any  Hazardous  Materials  on, or removed  from,  the
Property  or  any  portion  thereof.  Lessor  retains  the  right  to  join  and
participate,  as a party,  in any legal  actions  affecting  the Property or any
portion  thereof  initiated in connection with Hazardous  Materials laws.

         14.07     Lessee  will  indemnify,  protect,  defend and  forever  hold
Lessor,  its agents,  employees,  lenders  and ground  lessor,  if any,  and the
Premises,  the  Property,  or any  portion  thereof,  harmless  from any and all
damages,  losses,  liabilities,   judgments,   penalties,  claims,  obligations,
attorneys' and consultants' fees and any other costs and expenses arising out of
any failure of Lessee, its agents, contractors,  employees, suppliers, licensees
or  invitees  to  observe  any  covenants  of this  Section  14 of  this  Lease.
Non-compliance by Lessee with any provisions of this Section 14 shall constitute
a Breach under this Lease,  and all  provisions of this Section 14 shall survive
any termination of this Lease.

15.      AUCTIONS AND SIGNS

         15.01     Lessee will not conduct,  nor permit to be conducted,  either
voluntarily  or  involuntarily,  any auction on or about the  Property,  without
having the express written  consent of Lessor,  and Lessor will not be obligated
to exercise  any standard of  reasonableness  in  determining  whether or not to
grant such consent.  Should  Lessor grant such consent,  Lessee will comply with
any requirements of Lessor and any applicable laws governing such an auction.

         15.02     Lessee will not place any  Signage on or about the  Property,
or on any part  thereof,  without  the prior  written  consent of Lessor,  which
Lessor may withhold in its sole  discretion.  All approved  Lessee  Signage will
comply with the terms and  conditions  of this Lease and the sign  criteria  set
forth in Exhibit "C" and Exhibit "D", Rules and  Regulations,  or other criteria
which Lessor may  establish  from time to time.  Non-compliance  with any of the
provisions of this Paragraph 15,  Exhibit "C' or Exhibit "D" shall  constitute a
Default under this Lease.

16. LESSOR'S ACCESS

         16.01     Lessor, its agents,  contractors,  consultants,  servants and
employees,  will have the right to enter the Premises at any time in the case of
an emergency,  and otherwise at reasonable  times and upon reasonable  notice to
(a) examine the Premises; (b) perform any obligation to or exercise any right or
remedy of Lessor under this Lease; (c) make repairs,  alterations,  improvements
or  additions  to the  Premises or to other  portions of the  Property as Lessor
deems  necessary or desirable;  (d) perform work  necessary to comply with laws,
ordinances,  rules  or  regulations  of any  governing  authority  or  insurance
underwriter;  (e) serve,  post or keep  posted any  notices  required or allowed
under the  provisions  of this Lease or by law;  (f) show at  reasonable  times,
Lessee's Premises to prospective  lessees; (g) post on or about the Premises any
ordinary  "For Lease"  signs  during the last sixty (60) days of the Lease Term;
and (h)  perform  work at  Lessee's  sole cost that Lessor  deems  necessary  to
prevent waste or deterioration of the Premises should Lessee fail to commence to
make, and diligently pursue to completion, its

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required repairs.  When the Lessor is exercising its right to enter the premises
for various allowed purposes, Lessor will comply with all of Lessee's reasonable
instructions with respect to hazardous materials and controlled  substances kept
on the  premises  by  Lessee,  and will be  responsible  to Lessee for any loss,
liability, cost, or expense directly arising from Lessor's failure to do so.

                                                                       [INITIAL]

         16.02     For each of the purposes  described in Paragraph 16.01 above,
Lessor will at all times have and retain any necessary keys with which to unlock
all doors in, upon and about the Premises,  excluding Lessee's vaults and safes.
Lessee  will not alter any lock or install new or  additional  locks or bolts on
any door in or about the  Premises  without  obtaining  Lessor's  prior  written
approval  and will,  in each event,  furnish  Lessor with a new key.  All access
activities of Lessor will be without  abatement of rent or liability on the part
of Lessor.

17.      ABANDONMENT

         Lessee will not vacate or abandon the Premises,  or permit the Premises
to remain  unoccupied for any period longer than fifteen (15)  consecutive  days
any time during the Lease Term. If Lessee  abandons,  vacates or surrenders  the
Premises,  or is  dispossessed  by process of law, or  otherwise,  any  personal
property  belonging to Lessee left in or about the Premises  will, at the option
of Lessor, be deemed abandoned and may be disposed of by Lessor.

18.      DAMAGE OR DESTRUCTION

         18.01     If the Premises,  or any portion of the Property,  is damaged
or destroyed by fire or other  casualty,  Lessee will  immediately  give written
notice to Lessor of the casualty and Lessor will  promptly  repair the damage as
set forth in Paragraph 18.03 unless Lessor has the right to terminate this Lease
as provided In Paragraphs 18.02 and 18.04, and lessor elects to so terminate.

       18.02       If Lessee, or its agents, contractors,  employees, suppliers,
licensees  or  invitees is not the cause of the  casualty,  Lessor will have the
right,  but not the obligation,  to terminate this Lease following a casualty if
any  of  the  following  occurs:  (i)  insurance  proceeds  (excluding  Lessor's
deductible  and including  Lessee's  deductible)  together  with any  additional
monies Lessee elects,  at its option,  to contribute are not available to Lessor
to pay one hundred  percent (100%) of the cost to fully repair the damage;  (ii)
Lessor determines that the Premises cannot,  with reasonable  diligence,  within
six (6) months after Lessor obtains knowledge of the casualty, be fully repaired
by Lessor or cannot be safely  repaired  because of the  presence  of  hazardous
factors and  conditions,  including  but not limited  to,  Hazardous  Materials,
earthquakes,  utility outages and any other similar dangers;  (iii) the Premises
are damaged or  destroyed  within the last twelve (12) months of the Lease Term;
(iv) the building within which the Premises is located,  or any other portion of
the  Property,  is damaged or destroyed  and Lessor (as  determined  in its sole
discretion)  cannot  reasonably  complete  such repair  within six (6) months of
Lessor obtaining  knowledge of the casualty;  (v) Lessee is in Default or Breach
of this Lease at the time of the  casualty;  or (vi)  Lessor  would be  required
under Paragraph 18.05 to abate or reduce Lessee's rent for a period in excess of
six (6) months if the repairs  were  undertaken.  If Lessor  elects to terminate
this Lease  pursuant to this  Paragraph  18.02,  Lessor will give Lessee written
notice of this election,  and fifteen (15) days after  Lessee's  receipt of such
notice,  this Lease will  terminate.  If Lessor elects to terminate  this Lease,
subject to the rights of any  mortgagee,  Lessor  will be entitled to retain all
applicable Lessee insurance  proceeds  excepting those  attributable to Lessee's
furniture, fixtures, equipment,  installations, and any other personal property.
See Addendum 2.

         18.03     If Lessee, or its agents, contractors,  employees, suppliers,
licensees or invitees is not the cause of the casualty, and Lessor elects not to
terminate  this  Lease,  this Lease will  remain in full force and  effect,  and
Lessor  will,  within ten (10) days after  receipt of all  applicable  insurance
proceeds  and monies  required to fully repair 100% of the  Premises,  begin the
process of  obtaining  all  necessary  permits and  approvals,  and upon receipt
thereof, diligently pursue the repair through completion.

         18.04     If Lessee, or its agents, contractors,  employees, suppliers,
licensees  or invitees  is the cause of the  casualty,  or any portion  thereof,
Lessor may elect any of the following:  (i) to continue this Lease in full force
and  effect;  (ii) to make Lessor or Lessee,  as  determined  in  Lessor's  sole
discretion,  responsible  for the  completion  of all,  or any  portion,  of the
repairs necessitated by the casualty,  and all such repairs shall be at Lessee's
sole cost and expense;  and/or (iii) terminate this Lease with fifteen (15) days
written notice and retain all applicable  Lessee  insurance  proceeds  excepting
those  specifically  attributable to Lessee's  furniture,  fixtures,  equipment,
installations,  and other personal property. No election by Lessor of any remedy
hereunder shall be deemed a limitation on Lessee's liability.

         18.05     If Lessor  elects not to  terminate  this  Lease,  during the
period of  repair,  Lessee's  rent will be  temporarily  abated  or  reduced  in
proportion to the degree to which  Lessee's use of the Premises is impaired,  as
determined  by Lessor in its  reasonable  discretion,  beginning the date Lessor
obtains  knowledge of the casualty and ending on the date all repairs  affecting
Lessee's use of the Premises  are  substantially  completed,  as  determined  by
Lessor in its  reasonable  discretion.  However,  the total  amount of such rent
abatement or reduction shall not exceed the total amount of insurance  proceeds,
directly  attributable to Lessee's Premises,  Lessor may receive from any rental
loss insurance  coverage it may carry free from any claim of Lessee.  Except for
the  abatement of rent as herein  described,  Lessee will not be entitled to any
compensation or damages for the loss of or interference  with Lessee's  personal
property  (including but not limited to,  furniture,  fixtures,  equipment,  and
installations),  or existing improvements of the Premises,  Lessee Improvements,
Lessee  Alterations  or any other  improvements  on or about any  portion of the
Property,  or business,  or use, or access to all or any part of the Premises or
the Property  resulting from such damage,  destruction or repair,  including but
not limited to, any  consequential  damages,  opportunity  costs or lost profits
incurred or suffered by Lessee. In no event, however, will Lessor be responsible
for any  abatement  of rent if Lessee,  or its agents,  contractors,  employees,
suppliers,  licensees  or  invitees  is the cause of the  casualty,  or any part
thereof.

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19.      TRANSFER (ASSIGNMENT/SUBLETTING)

         19.01     Lessee will not assign,  sell,  mortgage,  encumber,  convey,
pledge,  sublet  or  otherwise  transfer  all or any part of  Lessee's  right or
interest in this Lease, or allow any other person or entity to occupy or use all
or any part of the  Premises  (collectively  called  "Transfer")  without  first
obtaining the written consent of Lessor which shall not unreasonably be withheld
or delayed.  The  following  shall be deemed a  "Transfer"  for purposes of this
section:  (i) a request  by Lessee  for an entity  other  than  itself to become
Lessee hereunder by merger, consolidation,  or other reorganization;  a transfer
of any ownership  interest in Lessee  (unless Lessee is an entity whose stock is
publicly  traded) so as to result in a change in the current  control of Lessee;
(ii) a grant of a  license,  concession,  or other  right  of  occupancy  of any
portion of the  Premises,  or (iii) the use of the  Premises  by any party other
than  Lessee.  Should  Lessee  desire a Transfer,  Lessee will notify  Lessor in
writing  of: (i)  Lessee's  intent to  Transfer.  (ii) the name of the  proposed
transferee;  (iii)  the  nature  of the  proposed  transferee's  business  to be
conducted  on the  Premises,  (iv) the  terms  and  provisions  of the  proposed
Transfer, and (v) any other information Lessor may reasonably request concerning
the proposed  Transfer;  including but not limited to, a statement of net worth,
financial statements covering a specified period of time,  environmental reports
and a completed environmental questionnaire supplied by Lessor.

         19.02     Lessee agrees, by way of example and without limitation, that
Lessor  may  withhold  its  consent  to a  proposed  Transfer  if  Lessor in its
reasonable  judgment  determines  that  the  proposed  transferee:  (a)  is of a
character  or is  engaged in a business  which is not in keeping  with  Lessor's
standards for the Property,  as determined solely by Lessor; (b) has a use which
conflicts  with a provision  of this Lease or proposes an  unacceptable  risk to
Lessor,  as determined  by Lessor;  (c) does not meet the  reasonable  financial
standards required by Lessor; (d) has been required by any prior lessor,  lender
or governmental authority to take a remedial action in connection with Hazardous
Materials  contaminating a property;  (e) is  unacceptable  because Lessee is in
Default or Breach under this Lease at the time of the request for Transfer or as
of the effective date of the Transfer.  Notwithstanding the foregoing,  Lessee's
right to a Transfer  is subject  to  Lessor's  approval  of  Lessee's  financial
condition at the time the Transfer is requested by Lessee.

         19.03     In the event Lessor consents to a Transfer, the Transfer will
not be  effective  until Lessor is in receipt of a fully  executed  agreement to
Transfer, in a form and of substance acceptable to Lessor, and a Transfer fee of
two hundred and fifty dollars  ($250.00) which shall represent  Lessee's minimum
liability  for such  service.  The  receipt  and  cashing of any check by Lessor
wherein such check is in a name other than that of Lessee will not  constitute a
Transfer.  Lessor  also  reserves  the right to collect any rents due under this
Lease  directly  from  the  transferee,  and  such  direct  collection  will not
constitute  recognition  of the  transferee  as Lessee or release  Lessee or any
guarantor  of  Lessee  from  any  of  its  obligations  under  this  Lease.  Any
consideration  received  by Lessee in excess of  Lessee's  Base Rent  (including
additional  rent) as a result  of a Lessor  approved  transfer  shall be due and
payable to Lessor and any rights of first refusal,  options or expansions  under
the original lease shall be null and void.

         19.04     Lessor  may,   within   fifteen  (15)   business  days  after
submission  of  Lessee's  written  request for  Lessor's  consent to a Transfer,
cancel  this Lease  (or,  as to a  subletting  or  assignment,  cancel as to the
portion of the  Premises  proposed to be sublet or  assigned) as of the date the
proposed  Transfer was to be effective.  If Lessor  cancels this Lease as to any
portion of the  Premises,  then this Lease shall  cease for such  portion of the
Premises, and Lessee shall pay to Lessor all Base Rent and other amounts accrued
through the cancellation date relating to the portion of the Premises covered by
the proposed Transfer and all brokerage commissions paid or payable by Lessor in
connection  with this Lease that are  allocable to such portion of the Premises.
Thereafter,  Lessor may lease such  portion of the  Premises to the  prospective
transferee (or to any other person) without liability to Lessee.

         19.05     If Lessor has not  responded in writing to a Transfer  within
fifteen (15) business days of Lessee's request hereunder,  Lessor will be deemed
to have approved Lessee's request.

20.      DEFAULT AND BREACH

         20.01     Lessee's  performance of each of Lessee's  obligations  under
this Lease is a condition as well as a covenant.  Lessee's  right to continue in
possession of the Premises is conditioned upon such performance.  Time is of the
essence in the performance of all covenants and conditions.  Lessee's failure to
perform  any of its  obligations  shall put it in Default  or Breach  under this
Lease.

         20.02     A "Default"  is a failure to fulfill  any terms,  conditions,
covenants or rules under this Lease.  A "Breach" is a Default  which has no cure
period,  stated or otherwise,  or a Default which is not cured within the stated
cure  period  provided  under this  Lease.  Lessor  and Lessee  agree that if an
attorney is consulted by Lessor in connection  with a Lessee  Default or Breach,
$250.00 is a reasonable minimum sum to charge Lessee as Additional Rent to cover
Lessor's legal  preparation and service costs.  Unless  otherwise stated in this
Lease, Lessee will be in Breach if at any time during the Lease Term:

         (a)       Lessee  fails to make any  payment of Base  Rent,  Additional
                   Rent, or any other  monetary  payment  required to be made by
                   Lessee  herein and Lessee does not cure such  failure  within
                   five (5) days after  receipt of  Lessor's  written  notice to
                   Lessee.

         (b)       Lessee  fails to provide  Lessor with proof of  insurance  or
                   performance or surety bond as required under this Lease;  and
                   Lessee does not cure such failure  within five (5) days after
                   Lessor's

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<PAGE>

written notice to Lessee.

         (c)       Lessee, at any time during the Lease Term, fails to maintain,
                   in full force and effect, its required insurance coverage.

         (d)       Lessee  fails  to  ensure  that  life  and  property  are not
                   endangered,   as  determined  by  Lessor  in  its  reasonable
                   discretion.

                                                                       [INITIAL]

         (e)       Lessee  vacates the Premises with payment of rent or abandons
                   the Premises as further  described  in  Paragraph  17. In the
                   event  of  such  abandonment,  Lessee  shall  not be  held in
                   default as long as it conducts thorough weekly inspections of
                   the premises.

         (f)       Lessee  fails to  observe,  perform or comply with any of the
                   non-monetary  terms,  covenants,  conditions,  provisions  or
                   rules and  regulations  applicable to Lessee under this Lease
                   and such  failure is curable,  in the sole opinion of Lessor,
                   and then is not cured  within  ten (10) days  after  Lessor's
                   written  notice to  Lessee;  provided,  however,  that if the
                   nature of Lessee's obligation is such that more than ten (10)
                   days are required for performance, then Lessee will not be in
                   Breach if Lessee commences  performance  within such ten (10)
                   day  period  and  thereafter  diligently,  in  Lessor's  sole
                   opinion, pursues such cure to completion.

         (g)       Lessor discovers that any financial statement of Lessee or of
                   any guarantor of this Lease given to Lessor,  was  materially
                   false.

         (h)       Lessee makes any general  arrangement  or assignment  for the
                   benefit of creditors,  becomes a "debtor" as defined in 11 U.
                   S.  Code   Section  101  or  any   successor   statute,   has
                   substantially  all its assets  located at the Premises or its
                   interest  in this Lease  appointed  to a receiver or trustee,
                   indicates in Lessor's  reasonable opinion an inability to pay
                   its debts or obligations as they occur, has an attachment, or
                   execution or other judicial seizure of  substantially  all of
                   its assets  located at the  Property or its  interest in this
                   Lease.

         (i)       Lessee is in Breach of any other  term or  condition  of this
                   Lease.

 21.     REMEDIES OF LESSOR

         21.01     If Lessee fails to perform any duty or  obligation  of Lessee
under this Lease,  Lessor may at its option  perform any such duty or obligation
on Lessee's  behalf.  The costs and expenses of any such  performance  by Lessor
will be  immediately  due and payable by Lessee upon  receipt from Lessor of the
reimbursement amount required.  In the event of a Breach of this Lease by Lessee
as defined in Paragraph  20.02,  with or without  notice or demand,  and without
limiting any other of Lessor's rights or remedies, Lessor may:

         (a)       Terminate  Lessee's  right to possession of the Premises,  in
                   which  case  this  Lease  will   terminate  and  Lessee  will
                   immediately  surrender  possession of the Premises to Lessor.
                   Lessor  reserves  all  right  and  remedies  available  to it
                   pursuant to the terms and conditions of this Lease as well as
                   under state law.  Lessee  hereby  grants  Lessor the full and
                   free right, to enter the Premises with process of law. Lessee
                   releases  Lessor of any  liability  for any damage  resulting
                   therefrom  and  waives  any  right to claim  damage  for such
                   re-entry.  Lessee also agrees that Lessor's  right to release
                   or any  other  right  given to  Lessor  as a  consequence  of
                   Lessee's  breach  hereunder  or by  operation  of  law is not
                   relinquished. On such termination, Lessor will be entitled to
                   recover from  Lessee:  (i) the worth at the time of the award
                   of the unpaid  rent which had been  earned at the time of the
                   termination;  (ii) the  worth at the time of the award of the
                   amount by which the unpaid rents which would have been earned
                   after  termination until the time of award exceeds the amount
                   of such  rental  loss  that  Lessee  proves  could  have been
                   avoided;  (iii)  the  worth at the  time of the  award of the
                   amount by which the unpaid rents for the balance of the Lease
                   Term  after  the time of award  exceeds  the  amount  of such
                   rental  loss for such  period  that  Lessee  proves  could be
                   reasonably  avoided;  and (iv) any other amount  necessary to
                   compensate  Lessor for all the damage  proximately  caused by
                   Lessee's failure to perform its obligations  under this Lease
                   or which in the ordinary course of events would likely result
                   therefrom,  including  but not  limited  to,  all  costs  and
                   expenses   attributable  to  recovering   possession  of  the
                   Premises,   reletting  expenses   (including  the  costs  and
                   expenses   of  any   necessary   repairs,   renovations   and
                   alterations to the Premises),  costs of carrying the Premises
                   (including  but not  limited  to,  Lessor's  payment  of real
                   property taxes and insurance premiums), actual legal fees and
                   associated  costs  and  expenses,   any  unearned   brokerage
                   commissions   paid  in  connection   with  this  Lease,   any
                   unamortized  Lessee  Improvements,  and  reimbursement of any
                   deferred rent or other Lease execution inducement.

         (b)       Continue  the  Lease and  Lessee's  right to  possession  and
                   recover  rent  as it  becomes  due.  Acts of  maintenance  or
                   preservation,  efforts  to relet  the  Premises,  removal  or
                   storage of Lessee's personal property or the appointment of a
                   receiver to protect Lessor's  interest under this Lease, will
                   not constitute a termination of Lessee's right to possession.
                   Lessor  agrees to make  reasonable  efforts to  mitigate  its
                   damages  provided  however,  Lessor  shall not be required to
                   relet  any or all of the  Premises  prior  to  leasing  other
                   vacant space on the Project,  nor shall Lessor be required to
                   accept a tenant of lesser  financial  quality than Lessee was
                   as of the commencement date of this Lease.

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

         21.02     In the event of bankruptcy of Lessee, or if Lessee becomes a
debtor as defined under the  Bankruptcy  Code,  Lessee assigns to Lessor all its
rights, title and interest in the Premises as security for its obligations under
this Lease. The expiration or termination of this Lease,  and/or the termination
of Lessee's  right to  possession,  will not relieve  Lessee from any  liability
accruing  during  Lessee's Lease Term or by reason of Lessee's  occupancy of the
Premises.  Any  efforts by Lessor to  mitigate  the  damages  caused by Lessee's
Breach of this Lease will not waive Lessor's right to recover damages.

         21.03     The "worth at the time of award"  referred to in 21.01(a)(i)
and 21.01(a)(ii) and 21.01(a)(iii) will be computed by discounting the amount at
the discount rate of the Federal  Reserve Bank of San Francisco in effect at the
time of award, plus one percent (1%).

         21.04     No right or remedy  conferred  upon or reserved to Lessor in
this Lease is intended to be exclusive of any right or remedy  granted to Lessor
by statute  or common  law,  and each and every  such  right and remedy  will be
cumulative.

22.      ARBITRATION

         In the event any dispute arises  regarding  matters  occurring  before,
during or after the term of this  agreement,  the parties  agree that in lieu of
judicial proceedings,  the matter shall be submitted to arbitration,  and if not
otherwise  resolved,  arbitrated  in  accordance  with the rules of the American
Arbitration  Association,  in a venue  nearest  to the  location  of the  Leased
Premises.  The  Lessor  and  Lessee  further  agree  that  such  requirement  of
arbitration  shall not be  limited  to  contractual  disputes  alone,  but shall
pertain to any dispute between Lessor and Lessee, whether arising from contract,
tort, in equity, under statute or administrative  resolution, or any other legal
basis.  This agreement to arbitrate  shall not,  however,  prohibit  Lessor from
exercising its statutory  and/or common law rights to proceed against Lessee for
possession  of the  Premises  and  damages  related  thereto,  in the  nature of
unlawful detainer, ejectment, or any other similar summary proceeding.

23.      SURRENDER OF LEASE NOT MERGER

         Unless   specifically  stated  otherwise  in  writing  by  Lessor,  the
voluntary or other surrender of this Lease by Lessee,  the mutual termination or
cancellation  of this Lease, or the termination of this Lease by Lessor due to a
Breach by Lessee,  will not work as a merger, and will, at the option of Lessor,
terminate all or any Transfer of the Premises or operate as a Transfer to Lessor
of any or all such Transfers.

24.      PROFESSIONAL FEES, COSTS AND EXPENSES

         24.01     In the event that any party to this Lease initiates an action
or  proceeding  to enforce the terms of this Lease or to declare the rights of a
party to this Lease,  the prevailing  party will be entitled to all actual costs
and  expenses,  including but not limited to, all fees and costs and expenses of
appraisers,  experts,  accountants  and attorneys,  which  obligations  shall be
deemed to have accrued as of the commencement date of such action or proceeding.
Should Lessor be named as a defendant in any legal action or proceeding  brought
against Lessee in connection with, or arising out of, Lessee's  occupancy within
the  Property,  Lessee  will pay to  Lessor  all of  Lessor's  actual  costs and
expenses  incurred,  including  its  legal  fees.  Attorneys'  fees  will not be
computed  in  accordance  with any court fee  schedule,  but will be the  actual
amount of any fees incurred.

         24.02     If Lessor  utilizes the services of any attorney  with regard
to Lessee's  occupancy or tenancy  under this Lease,  Lessor will be entitled to
reimbursement  by Lessee of its reasonable  legal fees, and all other reasonable
costs and expenses, whether or not a legal action is commenced by Lessor.

25.      CONDEMNATION

         If any portion of the  Premises or any portion of the Building in which
the  Premises  is  located,   or  any  portion  of  the  Property   which  would
substantially interfere with Lessor's ownership, or Lessor's or Lessee's ability
to  conduct  business  is taken for any  public or  quasi-public  purpose by any
governmental  authority,  including but not limited to, by exercise of the right
of appropriation, inverse condemnation,  condemnation or eminent domain, or sold
to prevent such taking,  Lessor, at its option, may terminate this Lease without
recourse by Lessee.  Any award for such taking or payment made under such threat
of exercise of such power will be the property of Lessor,  whether such award be
made as compensation  for diminution of value of the leasehold or for the taking
of the fee, or as  severance  damages;  however,  Lessee will be entitled to any
compensation,  separately awarded to Lessee for Lessee's relocation expenses and
alterations  made by  Lessee.  If this  Lease  is not  terminated,  Lessor  will
promptly proceed to restore the Premises and/or any portion of the Property used
in common by all lessees to  substantially  the same  condition as prior to such
taking  allowing for any  reasonable  effects of such  taking.  Should a partial
taking directly affect a portion of Lessee's Premises including parking area and
Lessor does not exercise its right to terminate this Lease,  Lessor will make an
appropriate  allowance to Lessee for the rent  corresponding  to the term during
which,  and to the part of the Premises which,  Lessee is deprived on account of
such taking and restoration.

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26.      RULES AND REGULATIONS

         Lessee  agrees to abide by, keep and observe all rules and  regulations
Lessor has set forth in Exhibit  "D".  Lessor  reserves  the right to modify and
amend them,  upon prior notice to Lessee,  as it deems necessary and will not be
responsible to Lessee for any  nonperformance  by any other lessee,  occupant or
invitee of the Property of any said rules and regulations.  Violation by Lessee,
its employees,  agents,  contractors,  suppliers,  invitees or licensees will be
deemed a Default under this Lease.

27.      ESTOPPEL CERTIFICATE

         Lessee  will  execute and  deliver,  in a form  prepared by Lessor,  to
Lessor  within ten (10) days after  written  receipt of notice  from  Lessor,  a
written  statement  certifying:  (i) that this Lease is  unmodified  and in full
force and effect (or,  if  modified,  stating the nature of such  modification);
(ii) the date to which rent and any other  charges are paid in advance,  if any;
(iii)  acknowledgment  that there are not,  to Lessee's  knowledge,  any uncured
Defaults on the part of Lessor,  or stating the nature of any uncured  Defaults;
(iv) the  current  Base Rent  amount  and the  amount  and form of the  Security
Deposit  on  deposit  with  Lessor;  and (v) any other  information  as  Lessor,
Lessor's agents,  mortgagees and prospective  purchasers may reasonably request,
including  but not limited to, any  requested  information  regarding  Hazardous
Materials.  Lessee's  failure to deliver such statement  within ten (10) days of
its receipt will be deemed as Lessee's  conclusive  confirmation  that: (1) this
Lease (including  specifically the Base Rent, Additional Rent and Lease Term) is
in full force and effect and without  modification  except as may be represented
by Lessor; (2) neither Lessor nor Lessee are in Default under the Lease; and (3)
not more than one (1) month's rent  charges,  if any, are paid in advance.  Such
failure shall be deemed, at Lessor's option, a Breach of this Lease.

28.      SALE BY LESSOR

         Upon the sale or any other conveyance by Lessor of the Property, or any
portion  thereof,  Lessor will be relieved of all liability under any and all of
its covenants and obligations contained in or derived from this Lease or arising
out of any act, encumbrance,  occurrence or omission occurring after the date of
such  conveyance.  In such event,  all obligations of Lessor,  under this Lease,
transfer to new Lessor.

29.      NOTICES

         All written  communications and notices required under this Lease shall
be considered  sufficiently given and served if sent to: 1) Lessee by U. S. mail
(First Class, postage prepaid),  personal delivery or by other reasonable method
(including posting on or about the Premises),  unless otherwise required by law,
to the address  indicated in Paragraph  1.05 and shall be deemed  received three
(3) days after such mailing,  personal  delivery or posting;  2) Lessor by U. S.
mail (First Class,  postage prepaid),  registered or certified (unless otherwise
required by law) to the address  indicated in Paragraph 1.06 and shall be deemed
received  five (5) days  after  such  mailing;  and 3)  Lessee by  facsimile  or
overnight  delivery and shall be deemed  received  twenty-four  (24) hours after
transmission of such facsimile or placement in an overnight  depository.  At any
time  during the Lease Term,  Lessor or Lessee may  specify a  different  Notice
Address by providing written notification to the other.

30.      WAIVER

         No waiver by Lessor  of a Default  or Breach of any term,  covenant  or
condition  of this Lease by Lessee,  will be deemed a waiver of any other  term,
covenant or condition of this Lease,  or of any subsequent  Default or Breach of
Lessee of the same or any other term,  covenant or condition of this Lease,  nor
will any delay or omission by Lessor to seek a remedy for any Lessee  Default or
Breach of this Lease be deemed a waiver by Lessor of its remedies or rights with
respect  to  such  Default  or  Breach.  Additionally,  regardless  of  Lessor's
knowledge of a Default or Breach at the time of accepting  rent,  the acceptance
of rent by Lessor  whether  on  account  of monies or  damages  due  Lessor,  or
otherwise,  will not  constitute  a waiver by Lessor of any Default or Breach by
Lessee.

31.      LESSEE'S INTENT; HOLDOVER

         Unless otherwise  specified in this Lease, Lessee will give Lessor, not
less than  ninety  (90) days prior to the  expiration  date of this Lease  Term,
written  notice of its intent to remain or vacate the Premises on the expiration
date of this Lease.  If Lessee  remains in  possession of all or any part of the
Premises with Lessor's  written  consent after the expiration of the Lease Term,
such  possession  will  constitute  a  month-to-month   tenancy,  which  may  be
terminated by either  Lessor or Lessee with thirty (30) days written  notice and
will not  constitute a renewal or extension of the Lease Term. If Lessee remains
in possession  after the Lease Term without Lessor's  written  permission,  such
possession will constitute a  tenancy-at-will  terminable upon  forty-eight (48)
hour notice by either Lessee or Lessor. In the event of a month-to-month tenancy
or tenancy-at-will,  Lessee's Base Rent will be one hundred fifty percent (150%)
of the Base Rent payable  during the last month of the Lease Term, and any other
sums due under  this  Lease  will be  payable  in the  amounts  and at the times
specified in this Lease and all options,  rights of refusal,  expansions  and/or
renewals  shall be null and void.  Such  tenancy  will be subject to every other
term, condition and covenant contained in this Lease.

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33.      DEFAULT BY LESSOR;LIMITATION OF LIABILITY; REAL ESTATE INVESTMENT TRUST

         33.01     In the event  Lessor is  deemed in  Default  or Breach in the
performance of any obligation  required to be performed under this Lease, Lessee
will notify  Lessor In writing,  pursuant to the  provisions of Paragraph 29, of
Lessor's  Default or Breach at Lessor's Notice Address as specified In Paragraph
1.06,  and within ten (10) working  days of receipt of such notice,  Lessor will
commence  to make a good  faith  effort to cure the  Default  or Breach and in a
diligent and prudent manner continue to do so until completion.

         33.02     The  obligations  of Lessor under this Lease shall be binding
only on Lessor and not upon any of the individual partners, investors, trustees,
directors,  officers,  employees, agents, shareholders,  advisors or managers of
Lessor in their  individual  capacities,  and with respect to any obligations of
Lessor to Lessee, Lessee's sole and exclusive remedy shall be against Lessor.

         33.03     In consideration of the benefits accruing  hereunder,  Lessee
on behalf of itself and all of its Transferees covenants and agrees that, in the
event of any  actual or  alleged  failure,  Default  or Breach of this  Lease by
Lessor,  Lessee's  recourse  against  Lessor for any  monetary  damages  will be
limited to the lesser of Lessor's interest in the Property including, subject to
the  prior  rights  of any  mortgagee,  Lessor's  interest  in the  rents of the
Property,  or Lessor's  equity  interest in the  Property if the  Property  were
encumbered  by debt in an amount equal to eighty  percent  (80%) of its value of
the  Property as of the initial  date  Lessee  notifies  Lessor of the actual or
alleged  failure,  Default  or Breach,  and any  insurance  proceeds  payable to
Lessor.  Any action by Lessee  will be limited to actual  damages  only and will
not, under any circumstances, include future profits or consequential damages.

         33.04     If Lessor is a real estate investment trust, and if Lessor in
good faith  determines that its status as a real estate  investment  trust under
the applicable provisions of the Internal Revenue Code of 1986, as heretofore or
hereafter amended,  will be jeopardized  because of any provision of this Lease,
Lessor may  require  reasonable  amendments  to this Lease and Lessee  shall not
unreasonably  withhold  or  delay  its  consent  thereto,   provided  that  such
modifications  do not in any way, (i) increase the  obligations  of Lessee under
this Lease or (ii) adversely  affect any rights or benefits to Lessee under this
Lease.  Lessor  shall pay all  reasonable  costs  incurred by Lessee,  including
without  limitation,  legal  fees  incurred  for  reviewing  any  such  proposed
modifications.

34.      SUBORDINATION

         Without the  necessity of any  additional  document  being  executed by
Lessee for the  purposes of  effecting a  subordination,  and at the election of
Lessor or any  mortgagee or any ground  lessor with respect to the land of which
the Premises are a part, this Lease will be subject and subordinate at all times
to: (i) all ground leases or underlying  leases which may now exist or hereafter
be executed  affecting the Property and (ii) the lien of any mortgage or deed of
trust which may now exist or  hereafter  be executed in any amount for which the
Property,  ground leases or underlying leases, or Lessor's interest or estate in
any of said items is specified as  security.  Lessor or any  mortgagee or ground
lessor  will have the right,  at its  election,  to  subordinate  or cause to be
subordinated  any ground lessee or  underlying  leases or any such liens to this
Lease.  If Lessor's interest in the Premises is acquired by any ground lessor or
mortgagee,  or in the event any  proceedings are brought for the foreclosure of,
or in the event of  exercise  of power of sale  under,  any  mortgage or deed of
trust made by Lessor covering the Premises, or in the event a conveyance in lieu
of  foreclosure  is made  for  any  reason,  Lessee  will,  notwithstanding  any
subordination  and upon the  request of such  successor  in  interest to Lessor,
attorn to and become  the  Lessee of the  successor  in  interest  to Lessor and
recognize  such  successor  in interest as the Lessor  under this Lease.  Lessee
acknowledges that although this Paragraph 34 is self-executing, Lessee covenants
and  agrees to  execute  and  deliver,  upon  demand  by Lessor  and in the form
requested by Lessor,  or any other  mortgagee or ground  lessor,  any additional
documents evidencing the priority or subordination of this Lease with respect to
any such ground leases or underlying  leases or the lien of any such mortgage or
deed of trust.  Lessee's  failure to timely execute and deliver such  additional
documents will, at Lessor's option, constitute a Breach of this Lease.

35.      FORCE MAJEURE

         Neither party will have  liability to the other,  nor will either party
have any  right to  terminate  this  Lease  or abate  rent or  assert a claim of
partial or constructive eviction,  because of Lessor's failure to perform any of
its  obligations  under this  Lease if the  failure is due in part or in full to
reasons beyond Lessor's reasonable control. Such reasons will include but not be
limited  to:  strike,  other labor  trouble,  fuel,  labor or supply  shortages,
utility  failure or defect,

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the inability to obtain any necessary governmental permit or approval (including
building  permits and  certificates  of  occupancy),  war,  riot,  mandatory  or
prohibitive  injunction  issued  in  connection  with  the  enforcement  of  the
Americans with Disabilities Act of 1990, civil insurrection,  accidents, acts of
God, any governmental  preemption in connection with a national emergency or any
other  cause,  whether  similar or  dissimilar,  which is beyond the  reasonable
control of Lessor.  If this Lease  specifies a time period for performance of an
obligation  by Lessor,  that time  period  will be extended by the period of any
delay in Lessor's performance caused by such events as described herein.

36.      MISCELLANEOUS PROVISIONS

         36.01     Whenever the context of this Lease requires,  the neuter, the
masculine and the feminine  gender shall include the other,  and the word person
shall include  partnership or  corporation  or joint  venture,  and the singular
shall include the plural and the plural shall include the singular.

         36.02     If more than one person or entity is Lessee,  the obligations
imposed on each such person or entity will be joint and several.

         36.03     The  captions  and  headings  of this  Lease are used for the
purpose of  convenience  only and shall not be construed to interpret,  limit or
extend the meaning of any part of this Lease.

         36.04     This Lease contains all of the agreements and conditions made
between  Lessor and Lessee and may not be modified in any manner other than by a
written  agreement signed by both Lessor and Lessee.  Any statements,  promises,
agreements,  warranties  or  representations,   whether  oral  or  written,  not
expressly  contained  herein  will in no way bind either  Lessor or Lessee,  and
Lessor  and  Lessee  expressly  waive all  claims  for  damages by reason of any
statements,  promises,  agreements,  warranties or representations,  if any, not
contained in this Lease. No provision of this Lease shall be deemed to have been
waived by Lessor  unless  such  waiver is in writing  signed by a regional  vice
president  or  higher  of Lessor  or the  management  company,  and no custom or
practice which may develop between the parties during the Lease Term shall waive
or diminish the Lessor's  right to enforce  strict  performance by Lessee of any
terms of the Lease.

         36.05     Time is of the  essence  for the  performance  of each  term,
condition and covenant of this Lease.

         36.06     Except as otherwise expressly noted, each payment required to
be made by Lessee is in addition to and not in  substitution  for other payments
to be made by Lessee.

         36.07     Subject to Section 19, the terms,  conditions  and provisions
of  this  Lease  will  apply  to and  bind  the  heirs,  successors,  executors,
administrators and assigns of Lessor and Lessee.

         36.08     If  any  provision  contained  herein  is  determined  to  be
invalid,  illegal or unenforceable in any respect, such invalidity,  illegality,
or unenforceability will not affect any other provision of this Lease.

         36.09     In  consideration   of  Lessor's   covenants  and  agreements
hereunder,  Lessee  hereby  agrees  not to  disclose  any  terms,  covenants  or
conditions  of this Lease to any  non-related  party  other  than its  officers,
directors, attorneys or accountants without the prior written consent of Lessor.
Additionally,  Lessee  shall not record this Lease or any short form  memorandum
hereof without the prior written consent of Lessor, which Lessor may withhold in
its sole discretion.

         36.10     The rights and  obligations  of the parties  under this Lease
shall survive its termination.

         36.11     The  duties and warranties of  Lessor  are  limited  to those
expressly  stated in this Lease and does not and shall not  include  any implied
duties or  implied  warranties,  now or in the  future.  No  representations  or
warranties have been made by Lessor other than those contained in this Lease.

         36.12     Lessee  promises and it is a condition to the  continuance of
this Lease that there will be no  discrimination  against or  segregation of any
person or group of persons on the basis of race,  color,  sex,  creed,  national
origin or ancestry in the leasing,  subleasing,  transferring occupancy, tenure,
or use of the Property, the Premises, or any portion thereof.

         36.13     Lessor and Lessee  each  warrant to the other that it has not
dealt with any broker or agent in  connection  with this  Lease,  other than the
person(s) listed in Paragraph 1.15 above.  Except for any broker(s) who shall be
compensated in accordance  with the provisions of a separate  agreement,  Lessor
and Lessee each agree to indemnify the other against all costs, expenses,  legal
fees and other  liability for commissions or other  compensation  claimed by any
other broker or agent.

37.      EXAMINATION OF LEASE; GOOD FAITH DEPOSITS

         Submission  of this  document for  examination  and signature by Lessee
does not create a  reservation  or option to lease.  Lessee  hereby  agrees that
Lessor will be entitled to immediately  endorse and cash any good faith check(s)
forwarded by Lessee  along with this  document.  it is further  agreed that such
cashing of good faith  checks by Lessor will not  guarantee  acceptance  of this
document  by Lessor,  but, in the event  Lessor does not accept or

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execute this  document,  the amount of such good faith check(s) will be refunded
to Lessee.  This  document will become this "Lease" and be effective and binding
only upon full execution by authorized representatives of both Lessee and Lessor
as defined in this Lease.  Thereafter,  a fully executed copy of this Lease will
be deemed an original for all purposes.

38.      GOVERNING LAW

         This Lease is governed by and construed in accordance  with the laws of
the state in which the Premises are located,  and venue of any legal action will
be in the county where the Premises are located.

39.      LESSOR'S LIEN

         LESSOR  HEREUNDER  WILL HAVE THE  BENEFIT OF, AND THE RIGHT TO, ANY AND
ALL LESSOR'S LIENS PROVIDED UNDER THE LAW BY WHICH THIS LEASE IS GOVERNED.

40.      SPECIAL PROVISIONS AND EXHIBITS

         Special provisions of this Lease number 41 through        are attached
                                                               ------
hereto and made a part hereof. The following Exhibits are attached to this Lease
and by this reference made a part hereof: "A", "Al", "A2", "B", "C", and "D".

         IN WITNESS  WHEREOF,  Lessor and Lessee have  executed this Lease as of
the day and year indicated by Lessor's execution date as written below.

         If Lessee is a corporation, each person signing this Lease on behalf of
Lessee  represents  and warrants that he or she has full  authority to do so and
that this Lease binds the  corporation.  Prior to the  execution  of this Lease,
Lessee  shall  deliver to Lessor a certified  copy of a  resolution  of Lessee's
Board of Directors  authorizing the execution of this Lease or other evidence of
such authority  reasonably  acceptable to Lessor.  If Lessee is a partnership or
limited liability  company,  each person or entity signing this Lease for Lessee
represents  and  warrants  that  he,  she  or it is a  general  partner  of  the
partnership  or limited  liability  company,  as  applicable.  Lessee shall give
written  notice to Lessor of any general  partner's or  member's  withdrawal  or
addition.  Simultaneous with the delivery of Lessee's signed lease, Lessee shall
deliver  to Lessor a copy of  Lessee's  recorded  statement  of  partnership  or
certificate of limited partnership or articles of organization, as applicable.

         THIS LEASE, WHETHER OR NOT EXECUTED BY LESSEE, IS SUBJECT TO ACCEPTANCE
BY LESSOR,  ACTING BY ITSELF OR BY ITS AGENT BY THE  SIGNATURE  ON THIS LEASE OF
ITS SENIOR  VICE  PRESIDENT,  VICE  PRESIDENT,  REGIONAL  MANAGER OR DIRECTOR OF
LEASING.

LESSOR:                                        LESSEE:
PS BUSINESS PARKS, L.P.                        EPITOPE, INC.
A California Limited Partnership               An Oregon Corporation
Federal ID #95-4609260



By:
      --------------------------------
      OWNER ENTITY


By:   Eileen Newkirk, Assistant                By: /s/ Charles E. Bergeron
      ----------------------                       -----------------------------
                Vice-President                     AUTHORIZED SIGNATURE

Date:     10-25-99                                 President/CFO
      ----------------------                       -----------------------------
      LEASE EXECUTION DATE                         TITLE



Lessor Fed. ID #95-4609260
                ----------

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                                   ADDENDUM #1

MUTUAL WAIVER OF SUBROGATION
ADDITION TO PARAGRAPH 12.03

To the extent permitted by their respective  policies of insurance,  the parties
hereby  waive  any right of  recovery  against  the other  party for any loss or
damage  that is covered by any  insurance  policy  maintained  or required to be
maintained with respect to this agreement. The parties shall inform all of their
insurers  of  policies   described  in  this  agreement  about  this  waiver  of
subrogation,  and shall  secure from such  insurers  amendments  to the policies
recognizing and providing for such waiver.


                                   ADDENDUM #2

ADDITION TO PARAGRAPH 18.02

If (a) the Premises are destroyed, or any substantial part thereof is damaged by
                                                                      ----------
fire, (b) the  destruction or damage is not the fault of Lessee,  and (c) Lessor
----
reasonably  determines that the Premises cannot be restored to substantially the
same condition as existed before the destruction,  damage or condemnation within
ninety (90) days  following such event and (d) the fire damage or destruction is
                                               ---------------------------------
limited to the Premises as opposed to a project-wide disaster,  then Lessee also
-------------------------------------------------------------
will have the right to  terminate  the Lease  unless  Lessor  provides  suitable
premises for Lessee's  occupancy  while the  replacement or repair work is being
done. In the event Lessor provides temporary premises,  Lessor will be obligated
to  abate  only the  positive  difference,  if any,  between  the Base  Rent and
Additional  Rent  under  the  Lease  and the cost to  Lessor  in  providing  the
temporary  premises.  In no event will Lessee be  obligated to pay more than the
Base Rent and Additional Rent for the temporary  premises without Lessee's prior
written  consent.  Lessor must  determine  within thirty (30) days following the
destruction or damage whether the Premises can be restored.


                                   ADDENDUM #3

OPTION TO EXTEND LEASE

Provided  Lessee is not in default under any terms and  conditions of the Lease,
Lessee  shall  have the option to extend the term of this Lease for -5- years on
the  same  terms  and  conditions  of  this  Lease,  except  for  the  following
provisions:

         1.   That the Base Monthly  Rental during the option period shall be at
              market rate.

         2.   That the option to extend  shall be exercised in writing by Lessee
              270 days prior to the expiration of the initial term of the within
              lease.

         3.   In the event  that  Lessor and  Lessee  have not  reached a mutual
              agreement  in writing at least  ninety (90) DAYS in advance of the
              renewal term,  this Lease shall terminate at the expiration of the
              initial -5- year term.
                                       17                              [INITIAL]
<PAGE>
                                    Exhibits

Ex. A          The Project [Diagrams]

               First Floor/Second Floor [Diagram]

Ex. B          Tenant Improvement List

Ex. C          Sign Requirements

Ex. D          Rules and Regulations