Document:

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                                                                   EXHIBIT 10.34

                                                                     Page 1 of 9
10k Wizard; SEC Filings

                              SPEEDFAM-IPEC, INC.

                       STAND-ALONE STOCK OPTION AGREEMENT

I.   NOTICE OF STOCK OPTION GRANT

     Peter Simone

     61 Lehigh Road

     Wellesley, MA 02482

     You have been granted a Nonstatutory Stock Option to purchase Common Stock
of the Company, subject to the terms and conditions of this Agreement, as
follows:

     Date of Grant                      June 14, 2001

     Vesting Commencement Date          June 18, 2001

     Exercise Price per Share           $        3.65

     Total Number of Shares Granted           360,000

     Total Exercise Price               $   1,314,000

     Term/Expiration Date:              June 13, 2004

     Vesting Schedule:

     This Option shall vest and may be exercised, in whole or in part, in
accordance with the following schedule:

     One eighteenth (1/18) of the Shares subject to this Option shall vest each
month after the Vesting Commencement Date so that this Option shall be fully
vested eighteen (18) months from the Date of Grant, subject to the Optionee
continuing to be a Service Provider on such dates.

     In the event that the Company or any successor corporation (i) terminates
Optionee as a Service Provider other than for Cause following a Change of
Control (as defined in Section 10(c)) or (ii) Constructively Terminates
Optionee as a Service Provider following a Change of Control, all remaining
unvested Shares shall vest immediately.

          Termination Period

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     This Option may be exercised for thirty (30) days after Optionee ceases to
be a Service Provider in accordance with Section 7 of this Agreement. Upon the
death or Disability of the Optionee, this Option may be exercised for twelve
(12) months after the Optionee ceases to be a Service Provider in accordance
with Sections 8 and 9 of this Agreement. In no event shall this Option be
exercised later than the Term/Expiration Date provided.

II.  AGREEMENT

     1. Definitions. As used herein, the following definitions shall apply:

          (a) "Agreement" means this stock option agreement between the Company
and Optionee evidencing the terms and conditions of this Option.

          (b) "Applicable Laws" means the requirements relating to the
administration of stock options under U.S. state corporate laws, U.S. federal
and state securities laws, the Code, any stock exchange or quotation system on
which the Common Stock is listed or quoted and the applicable laws of any
foreign country or jurisdiction that may apply to this Option.

          (c) "Board" means the Board of Directors of the Company or any
committee of the Board that has been designated by the Board to administer this
Agreement.

          (d) "Cause" means the occurrence of any one or more of the following:
(i) Optionee's conviction by, or entry of a plea of guilty or nolo contendere
in, a court of competent jurisdiction for any crime which constitutes a felony
in the jurisdiction involved; (ii) Optionee's misappropriation of funds or
commission of an act of fraud, whether prior or subsequent to the date hereof,
upon the Company or any successor corporation; or (iii) negligence by Optionee
in the scope of Optionee's services to the Company or any successor corporation.

          (e) "Code" means the Internal Revenue Code of 1986, as amended.

          (f) "Common Stock" means the common stock of the Company.

          (g) "Company" means SpeedFam-IPEC, Inc., an Illinois corporation.

          (h) "Constructively Terminates" means that the Optionee is required
(i) to perform services for the Company or any successor corporation that
involve responsibilities and duties substantially below the level of a senior
executive officer of a publicly-traded company, (ii) to commit more than
twenty-five percent (25%) of his business time and attention to the Company or
any successor corporation, or (iii) to enter into any agreement that obligates
him or restricts his actions substantially more than the terms set forth in the
letter of employment, dated June 14, 2001.

          (i) "Consultant" means any person, including an advisor, engaged by
the Company or a Parent or Subsidiary to render services to such entity.

          (j) "Director" means a member of the Board.

          (k) "Disability" means total and permanent disability as defined in
Section 22(e)(3) of the Code.

                                      -2-

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     (l) "Employee" means any person, including Officers and Directors,
employed by the Company or any Parent or Subsidiary of the Company. A Service
Provider shall not cease to be an Employee in the case of (i) any leave of
absence approved by the Company or (ii) transfers between locations of the
Company or between the Company, its Parent, any Subsidiary, or any successor.
Neither service as a Director nor payment of a director's fee by the Company
shall be sufficient to constitute "employment" by the Company.

     (m) "Exchange Act" means the Securities Exchange Act of 1934, as amended.

     (n) "Fair Market Value" means, as of any date, the value of Common Stock
determined as follows:

            (1) If the Common Stock is listed on any established stock exchange
or a national market system, including without limitation the Nasdaq National
Market or The Nasdaq SmallCap Market of The Nasdaq Stock Market, its Fair
Market Value shall be the closing sales price for such stock (or the closing
bid, if no sales were reported) as quoted on such exchange or system on the day
of determination, as reported in The Wall Street Journal or such other source
as the Administrator deems reliable;

            (2) If the Common Stock is regularly quoted by a recognized
securities dealer but selling prices are not reported, its Fair Market Value
shall be the mean between the high bid and low asked prices for the Common
Stock on the day of determination; or

            (3) In the absence of an established market for the Common Stock,
the Fair Market Value thereof shall be determined in good faith by the Board.

     (o) "Nonstatutory Stock Option" means an Option not intended to qualify as
an incentive stock option within the meaning of Section 422 of the Code and the
regulations promulgated thereunder.

     (p) "Notice of Grant" means a written notice, in Part I of this Agreement,
evidencing certain the terms and conditions of this Option grant. The Notice of
Grant is part of the Option Agreement.

     (q) "Officer" means a person who is an officer of the Company within the
meaning of Section 16 of the Exchange Act and the rules and regulations
promulgated thereunder.

     (r) "Option" means this stock option.

     (s) "Optioned Stock" means the Common Stock subject to this Option.

     (t) "Optionee" means the person named in the Notice of Grant or such
person's successor.

     (u) "Parent" means a "parent corporation," whether now or hereafter
existing, as defined in Section 424(e) of the Code.

                                      -3-

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          (v)  "Service Provider" means an Employee, Director or Consultant to
the Company or any successor corporation.

          (w)  "Share" means a share of the Common Stock, as adjusted in
accordance with Section 11 of this Agreement.

          (x)  "Subsidiary" means a "subsidiary corporation", whether now or
hereafter existing, as defined in section 424(f) of the Code.

     2.   Grant of Option. The Board hereby grants to the Optionee named in the
Notice of Grant attached as Part I of this Agreement the Option to purchase the
number of Shares, as set forth in the Notice of Grant, at the exercise price
per share set forth in the Notice of Grant (the "Exercise Price"), subject to
the terms and conditions of this Agreement.

     3.   Exercise of Option.

          (a)  Right to Exercise. This Option is exercisable during its term in
accordance with the Vesting Schedule set out in the Notice of Grant and the
applicable provisions of this Agreement.

          (b)  Method of Exercise. This Option is exercisable by delivery of an
exercise notice, in the form attached as Exhibit A (the "Exercise Notice"),
which shall state the election to exercise the Option, the number of Shares in
respect of which the Option is being exercised (the "Exercised Shares"), and
such other representations and agreements as may be required by the Company.
The Exercise Notice shall be completed by the Optionee and delivered to
Secretary of the Company. The Exercise Notice shall be accompanied by payment
of the aggregate Exercise Price as to all Exercised Shares. This Option shall
be deemed to be exercised upon receipt by the Company of such fully executed
Exercise Notice accompanied by such aggregate Exercise Price.

          (c)  Legal Compliance. No Shares shall be issued pursuant to the
exercise of this Option unless each issuance and exercise complies with
Applicable Laws. Assuming such compliance, for income tax purposes the Exercised
Shares shall be considered transferred to the Optionee on the date the Option is
exercised with respect to such Exercised Shares.

     4.   Method of Payment. Payment of the aggregate Exercise Price shall be
by any of the following, or a combination thereof, at the election of the
Optionee:

          (a)  cash or check;

          (b)  consideration received by the Company under a cashless exercise
program implemented by the Company; or

          (c)  surrender of other Shares, provided Shares acquired directly
from the Company, (i) have been owned by the Optionee for more than six (6)
months on the date of surrender, and (ii) have a Fair Market Value on the date
of surrender equal to the aggregate Exercise Price of the Exercised Shares.

                                      -4-
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     5. Non-Transferability of Option. This Option may not be transferred in
any manner otherwise than by will or by the laws of descent or distribution and
may be exercised during the lifetime of Optionee only by the Optionee. The
terms of this Agreement shall be binding upon the executors, administrators,
heirs, successors and assigns of the Optionee.

     6. Term of Option. This Option may be exercised only within the term set
out in the Notice of Grant, and may be exercised during such term only in
accordance with the terms of this Agreement.

     7. Termination of Relationship as a Service Provider. If the Optionee
ceases to be a Service Provider (other than for death or Disability), this
Option may be exercised for a period of thirty (30) days after the date of such
termination (but no event later than the expiration date of this Option as set
forth in the Notice of Grant) to the extent that the Option is vested on the
date of such termination. To the extent that the Optionee does not exercise
this Option within the time specified herein, the Option shall terminate.

     8. Disability of Optionee. If the Optionee ceases to be a Service Provider
as a result of the Optionee's Disability, this Option may be exercised for a
period of twelve (12) months after the date of such termination (but in no event
later than the expiration date of this Option as set forth in the Notice of
Grant) to the extent that the Option is vested on the date of such termination.
To the extent that Optionee does not exercise this Option within the time
specified herein, the Option shall terminate.

     9. Death of Optionee. If the Optionee dies while a Service Provider, the
Option may be exercised at any time within twelve (12) months following the
date of death (but in no event later then the expiration date of this Option as
set forth in the Notice of Grant), by the Optionee's estate or by a person who
acquired the right to exercise the Option by bequest or inheritance, but only
to the extent that the Optionee was entitled to exercise the Option at the
date of death. If, after death, the Optionee's estate or a person who acquired
the right to exercise the Option by bequest or inheritance does not exercise
the Option within the time specified herein, the Option shall terminate.

     10. Adjustments Upon Changes in Capitalization, Dissolution, Merger or
Asset Sale.

         (a) Changes in Capitalization. Subject to any required action by the
stockholders of the Company, the number of shares of Common Stock covered by
this Option, as well as the price per share of Common Stock covered by this
Option, shall be proportionately adjusted for any increase or decrease in the
number of issued shares of Common Stock resulting from a stock split, reverse
stock split, stock dividend, combination or reclassification of the Common
Stock, or any other increase or decrease in the number of issued shares of
Common Stock effected without receipt of consideration by the Company; provided,
however, that conversion of any convertible securities of the Company shall not
be deemed to have been "effected without receipt of consideration." Such
adjustment shall be made by the Board, whose determination in that respect shall
be final, binding and conclusive. Except as expressly provided herein, no
issuance by the Company of shares of stock of any class, or securities
convertible into shares of stock of any class, shall affect, and no adjustment
by reason thereof shall be made with respect to, the number of price of shares
of Common Stock subject to this Option.

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          (b) Dissolution or Liquidation. In the event of the proposed
dissolution or liquidation of the Company, the Board shall notify Optionee as
soon as practicable prior to the effective date of such proposed transaction.
The Board in its discretion may provide for the Optionee to have the right to
exercise his or her Option until fifteen (15) days prior to such transaction as
to all of the Optioned Stock covered thereby, including Shares as to which the
Option would not otherwise be exercisable. To the extent it has not been
previously exercised, the Option will terminate immediately prior to the
consummation of such proposed

          (c) Merger or Asset Sale. In the event of a merger of the Company with
or into another corporation, or the sale of substantially all of the assets of
the Company (a "Change of Control"), the Option shall be assumed or an
equivalent option substituted by the successor corporation or a Parent or
Subsidiary of the successor corporation. In the event that the successor
corporation refuses to assume or substitute for the Option, the Optionee shall
fully vest in and have the right to exercise the Option as to all of the
Optioned Stock, including Shares as to which it would not otherwise be vested or
exercisable. If the Option becomes fully vested and exercisable in lieu of
assumption or substitution in the event of a merger or sale of assets, the Board
shall notify the Optionee in writing or electronically that the Option shall be
fully exercisable for a period of fifteen (15) days from the date of such
notice, and the Option shall terminate upon the expiration of such period. For
the purposes of this paragraph, the Option shall be considered assumed if,
following the merger or sale of assets, the option confers the right to purchase
or receive, for each Share of Optioned Stock subject to the Option immediately
prior to the merger or sale of assets, the consideration (whether stock, cash,
or other securities or property) received in the merger or sale of assets by
holders of Common Stock for each Share held on the effective date of the
transaction (and if holders were offered a choice of consideration, the type of
consideration chosen by the holders of a majority of the outstanding Shares);
provided, however, that if such consideration received in the merger or sale of
assets is not solely common stock of the successor corporation or its Parent,
the Administrator may, with the consent of the successor corporation, provide
for the consideration to be received upon the exercise of the Option, for each
Share of Optioned Stock subject to the Option, to be solely common stock of the
successor corporation or its Parent equal in fair market value to the per share
consideration received by holders of Common Stock in the merger or sale of
assets.

     11.  Notices. Any notice to be given to the Company hereunder shall be in
writing and shall be addressed to the Company at its then current principal
executive office or to such other address as the Company may hereafter designate
to the Optionee by notice as provided in this Section. Any notice to be given to
the Optionee hereunder shall be addressed to the Optionee at the address set
forth beneath his signature hereto, or at such other address as the Optionee may
hereafter designate to the Company by notice as provided herein. A notice shall
be deemed to have been duly given when personally delivered or mailed by
registered or certified mail to the party entitled to receive it.

     12.  Withholding Taxes. Optionee agrees to make appropriate arrangements
with the Company (or the Parent or Subsidiary employing or retaining Optionee)
for the satisfaction of all Federal, state, and local income and employment tax
withholding requirements applicable to the Option exercise. Optionee
acknowledges and agrees that the Company may refuse to honor the exercise and
refuse to deliver Shares if such withholding amounts are not delivered at the
time of exercise.

                                      -6-

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     13.  Entire Agreement; Governing Law. This Agreement constitutes the entire
agreement of the parties with respect to the subject matter hereof and
supersedes in its entirety all prior undertakings and agreements of the Company
and Optionee with respect to the subject matter hereof, and may not be modified
adversely to the Optionee's interest except by means of a writing signed by the
Company and Optionee. This agreement is governed by the internal substantive
laws, but not the choice of law rules, of Illinois.

     14.  NO GUARANTEE OF CONTINUED SERVICE. OPTIONEE ACKNOWLEDGES AND AGREES
THAT THE VESTING OF SHARES PURSUANT TO THE VESTING SCHEDULE HEREOF IS EARNED
ONLY BY CONTINUING AS A SERVICE PROVIDER AT THE WILL OF THE COMPANY (AND NOT
THROUGH THE ACT OF BEING HIRED, BEING GRANTED AN OPTION OR PURCHASING SHARES
HEREUNDER). OPTIONEE FURTHER ACKNOWLEDGES AND AGREES THAT THIS AGREEMENT, THE
TRANSACTIONS CONTEMPLATED HEREUNDER AND THE VESTING SCHEDULE SET FORTH HEREIN DO
NOT CONSTITUTE AN EXPRESS OR IMPLIED PROMISE OF CONTINUED ENGAGEMENT AS A
SERVICE PROVIDER FOR THE VESTING PERIOD, FOR ANY PERIOD, OR AT ALL, AND SHALL
NOT INTERFERE WITH OPTIONEE'S RIGHT OR THE COMPANY'S RIGHT TO TERMINATE
OPTIONEE'S RELATIONSHIP AS A SERVICE PROVIDER AT ANY TIME, WITH OR WITHOUT
CAUSE.

     By your signature and the signature of the Company's representative below,
you and the Company agree that this Option of granted under and governed by the
terms and conditions of this Agreement. Optionee has reviewed this Agreement in
its entirety, has had an opportunity to obtain the advice of counsel prior to
executing this Agreement and fully understands all provisions of this Agreement.
Optionee hereby agrees to accept as binding, conclusive and final all decisions
or interpretations of the Board upon any questions relating to this Agreement.
Optionee further agrees to notify the Company upon any change in the residence
address indicated below.

OPTIONEE                                 SPEEDFAM-IPEC, INC.

-----------------------------------      ---------------------------------------
Signature                                By

-----------------------------------      ---------------------------------------
Print Name                               Title

-----------------------------------
Residence Address

-----------------------------------

-----------------------------------

                                      -7-
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                                   EXHIBIT A

                              SPEEDFAM-IPEC, INC.

                                EXERCISE NOTICE

SpeedFam-IPEC, Inc.
305 North 54th Street
Chandler, AZ 85226

Attention: Chief Financial Officer

     1. Exercise of Option. Effective as of today, ________________, 20__, the
undersigned ("Purchaser") hereby elects to purchase ______________ shares (the
"Shares") of the Common Stock of SpeedFam-IPEC. Inc. (the "Company") under and
pursuant to the Stock Option Agreement dated June 14, 2001 (the "Option
Agreement"). The purchase price for the Shares shall be [$______], as required
by the Option Agreement.

     2. Delivery of Payment. Purchaser herewith delivers to the Company the
full purchase price for the Shares.

     3. Representations of Purchaser. Purchaser acknowledges that Purchaser has
received, read and understood the Option Agreement and agrees to abide by and
be bound by their terms and conditions.

     4. Rights as Shareholder. Until the issuance (as evidenced by the
appropriate entry on the books of the Company or of a duly authorized transfer
agent of the Company) of the Shares, no right to vote or receive dividends or
any other rights as a stockholder shall exist with respect to the Optioned
Stock, notwithstanding the exercise of the Option. The Shares so acquired shall
be issued to the Optionee as soon as practicable after exercise of the Option.
No adjustment will be made for a dividend or other right for which the record
date is prior to the date of issuance, except as provided in Section 11 of the
Option Agreement.

     5. Tax Consultation. Purchaser understands that Purchaser may suffer
adverse tax consequences as a result of Purchaser's purchase or disposition of
the Shares. Purchaser represents that Purchaser has consulted with any tax
consultants Purchaser deems advisable in connection with the purchase or
disposition of the Shares and that Purchaser is not relying on the Company for
any tax advice.

     6. Successors and Assigns. The Company may assign any of its rights under
this Exercise Notice to single or multiple assignees, and this Exercise Notice
shall inure to the benefit of the successors and assigns of the Company.
Subject to the restrictions on transfer herein set forth, this Exercise Notice
shall be binding upon Optionee and his or her heirs, executors, administrators,
successors and assigns.

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     7. Interpretation. Any dispute regarding the interpretation of this
Exercise Notice shall be submitted by Optionee or by the Company forthwith to
the Board which shall review such dispute at its next regular meeting. The
resolution of such a dispute by the Board shall be final and binding on all
parties.

     8.   Entire Agreement; Governing Law. The Option Agreement is incorporated
herein by reference. This Agreement, and the Option Agreement constitute the
entire agreement of the parties with respect to the subject matter hereof and
supersede in their entirety all prior undertakings and agreements of the Company
and Purchaser with respect to the subject matter hereof, and may not be modified
adversely to the Purchaser's interest except by means of a writing signed by the
Company and Purchaser. This agreement is governed by the internal substantive
laws, but not the choice of law rules, of Illinois.

<Table>
<Caption>
<S>                                     <C>
Submitted by:                                Accepted by:

OPTIONEE                                SPEEDFAM-IPEC, INC.

-----------------------------           -----------------------------
Signature

-----------------------------           -----------------------------
Print Name

-----------------------------           -----------------------------
Address                                 Address

-----------------------------           -----------------------------

-----------------------------           -----------------------------

                                        Date Received:
                                                       --------------
</Table>

                                      -2-<PAGE>
                                                                   EXHIBIT 10.35

                                 LEASE AGREEMENT

                                     between

                              SELDIN PROPERTIES

                                      and

                    INTEGRATED PROCESS EQUIPMENT CORPORATION

                             Dated December 26, 1996

                                   EXHIBIT "A"
<PAGE>
                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                                    PAGE
                                                                                                    ----
<S>    <C>                                                                                          <C>
 1.    Demise of Premises ......................................................................      1

 2.    Definitions .............................................................................      1

 3.    Title and Condition......................................................................      5

 4.    Use of Leased Premises; Quiet Enjoyment..................................................      7

 5.    Term  ...................................................................................      8

 6.    Rent; Security Deposit ..................................................................      9

 7.    Net Lease; Non-Terminability.............................................................     11

 8.    Payment of Impositions; Compliance with Legal Requirements and Insurance Requirements....     12

 9.    Liens; Recording and Title ..............................................................     14

10.    Indemnification .........................................................................     14

11.    Maintenance and Repair ..................................................................     15

12.    Alterations .............................................................................     16

13.    Condemnation.............................................................................     17

14.    Insurance ...............................................................................     21

16.    Subordination to Financing ..............................................................     26

17.    Assignment, Subleasing and Vacating .....................................................     27

18.    Permitted Contests.......................................................................     29

19.    Conditional Limitations; Default Provisions .............................................     30

20.    Additional Rights of Landlord  ..........................................................     33

21.    Notices .................................................................................     34

22.    Estoppel Certificates ...................................................................     35

23.    Surrender and Holding Over ..............................................................     35

24.    Risk of Loss ............................................................................     36

25.    No Merger of Title ......................................... ............................     36
</TABLE>

                                        i
<PAGE>
                                TABLE OF CONTENTS
                                   (CONTINUED)

<TABLE>
<CAPTION>
                                                                                                    PAGE
                                                                                                    ----
<S>    <C>                                                                                          <C>
26.    Landlord's Liability ....................................................................     37

27.    Hazardous Substances.....................................................................     37

28.    Entry by Landlord .......................................................................     38

29.    Financial Statements.....................................................................     39

30.    Broker  .................................................................................     39

31.    Additional Provisions Regarding Use .....................................................     39

32.    Landlord's Right to Take Action..........................................................     39

33.    Miscellaneous ...........................................................................     40
</TABLE>

                                       ii
<PAGE>
                                TABLE OF CONTENTS
                                   (CONTINUED)

                         INDEX OF EXHIBITS AND SCHEDULES

<TABLE>
<CAPTION>
                                                                                                    PAGE
                                                                                                    ----
<S>          <C>                                                                                    <C>
Exhibit A -  Leased Premises

Exhibit B -  Permitted Encumbrances

Exhibit C -  Rent Schedule

Exhibit D -  Memorandum of Lease

Exhibit E -  Purchase Offer Computation

Schedule I - Schedule of Air Compressors
</TABLE>

                                       iii
<PAGE>
         THIS LEASE AGREEMENT is made this 26th day of December, 1996, by and
between Seldin Properties, a Nebraska partnership ("Landlord") and Integrated
Process Equipment Corporation, a Delaware corporation ("Tenant").

         In consideration of the rents and covenants herein stipulated to be
paid and performed, Landlord and Tenant hereby covenant and agree as follows:

         1.       Demise of Premises. Landlord hereby demises and lets to Tenant
and Tenant hereby takes and leases from Landlord for the term and upon the
provisions hereinafter specified the following described property (collectively,
the "Leased Premises");

                  (a)      the real property described in Exhibit "A" attached
hereto and made a part hereof together with the easements, rights and
appurtenances thereunto belonging (collectively the "Land"); and

                  (b)      the buildings, structures and other improvements
constructed and to be constructed on the Land (collectively, the
"Improvements").

         2.       Definitions. For all purposes of this Lease, except as
otherwise expressly provided the terms defined in this Section have the
meanings assigned to them in this Section, and include the plural as well as the
singular.

                  "Act" means the Comprehensive Environmental Response,
         Compensation, and Liability Act, (42. U.S.C. Section 9601 et seq.), as
         amended.

                  "Additional Rent" has the meaning given to it in Section 6(b).

                  "Adjoining Property" means all sidewalks and curbs adjoining
         any of the Leased Premises.

                  "Alteration" means any or all changes, additions,
         improvements, demolitions, reconstructions or replacements of any of
         the Improvements, both interior or exterior, ordinary and
         extraordinary.

                  "Assignment" means any Assignment of Rents and Landlord's
         Interest in Leases hereafter executed from Landlord to Lender (which
         may be contained in a Mortgage).

                  "Basic Rent" has the meaning given to it in Section 6(a).

                  "Basic Rent Payment Dates" has the meaning given to it in
         Section 6(a).

                  "Commencement Date" has the meaning given to it in Section 5.

                  "Condemnation" means a Taking and/or a Requisition as the
         context requires.

                                       1
<PAGE>
                  "CPI" means the Consumer Price Index for All Urban Consumers,
         All Items, U.S. City Average (1982-1984 - 100), published by the United
         States Department of Labor, Bureau of Labor Statistics, together with
         any successor rate selected by Landlord in its reasonable discretion in
         the event the foregoing is no longer published.

                  "Default" has the meaning given to it in Section 19(d).

                  "Default Rate" has the meaning given to it in Section 6(b).

                  "Deposit Increase Date" has the meaning given to it in Section
         6(c).

                  "Environmental Laws" means collectively the Act and any other
         present or future law, ordinance, rule or regulation of any local,
         county, state or federal authority having jurisdiction over the Leased
         Premises or any portion thereof or its use, including but not limited
         to: (a) the Federal Water Pollution Control Act (33 U.S.C. Section 1317
         et seq.), as amended; (b) the Federal Resource Conservation and
         Recovery Act (42 U.S.C. Section 6901 et seq.), as amended; (c) the
         Toxic Substance Control Act (15 U.S.C. Section 2601 et seq.), as
         amended; and (d) the Clean Air Act (42 U.S.C. Section 7401 et seq.) as
         amended.

                  "Event of Default" has the meaning given to it in Section
         19(a).

                  "Hazardous Substance" means any hazardous or toxic material
         or substance or waste which is defined by those or similar terms and is
         regulated as such under Environmental Laws.

                  "Improvements" has the meaning given to it in Section 1 (b).

                  "Insurance Requirement" means any one or more of the terms of
         each insurance policy required to be carried by Tenant under this Lease
         and the requirements of the issuer of such policy, and whenever Tenant
         shall be engaged in making any Alteration or Alterations, repairs or
         construction work of any kind (collectively "Work"), the term
         "Insurance Requirement" is also deemed to include a requirement that
         (i) all insurance policies shall contain an endorsement referring to
         such Work and (ii) Tenant shall obtain or cause its contractors and
         subcontractors to obtain workmen's compensation insurance covering all
         persons respectively employed by such parties in connection with the
         Work, and with respect to whom death or bodily injury claims could be
         asserted against Landlord or the Leased Premises.

                                        2
<PAGE>
                  "Land" has the meaning given to it in Section 1(a).

                  "Law" means any constitution, statute or rule of law, whether
         federal, state or local.

                  "Lease" means this Lease Agreement, as the same may hereafter
         be amended, modified or extended from time to time.

                  "Leased Premises" has the meaning given to it in Section 1.

                  "Legal Requirement" means any one or more of all present and
         future laws, codes, ordinances, orders, judgments, decrees,
         injunctions, rules, regulations and requirements, even if unforeseen or
         extraordinary, of every governmental or quasi-governmental authority or
         agency (but excluding those which by their terms are not applicable to
         and do not impose any obligation on Tenant, Landlord or the Leased
         Premises as a result of some grandfather clause or similar provision)
         and all covenants, restrictions and conditions now or hereafter of
         record which may be applicable to Tenant, to Landlord or to any of the
         Leased Premises, or to the use, manner of use, occupancy, possession,
         operation, maintenance, Alteration, repair or reconstruction of any of
         the Leased Premises, even if compliance therewith (i) necessitates
         structural changes or improvements or results in interference with the
         use or enjoyment of any of the Leased Premises or (ii) requires Tenant
         to carry insurance other than as required by the provisions of this
         Lease.

                  "Lender" means an entity which makes a Loan to Landlord,
         secured by a Mortgage and evidenced by a Note, or such Lender's
         successors and assigns thereof.

                  "Loan" means a loan made by a Lender to Landlord secured by a
         Mortgage and evidenced by a Note.

                  "Mortgage" means a mortgage or similar security instrument
         hereafter executed covering the Leased Premises by Landlord in favor of
         Lender.

                  "Net Award" means the entire award payable to Landlord by
         reason of a Condemnation, less any expenses reasonably incurred by
         Landlord in collecting such award.

                  "Net Proceeds" means the entire proceeds of any insurance
         required under Section 14 less any expenses reasonably incurred by
         Landlord in collecting such proceeds.

                                        3
<PAGE>
                  "Note" means a promissory note hereafter executed from
         Landlord to Lender, which Note will be secured by a Mortgage and an
         Assignment.

                  "Permitted Encumbrances" means those covenants, restrictions,
         reservations, liens, conditions, encroachments, easements listed on
         Exhibit "B" attached hereto and any other matters of title existing on
         the Commencement Date.

                  "Purchase Offer" has the meaning given to it in Section 13(b).

                  "Purchase Price" has the meaning given to it in Section 13(d).

                  "Requisition" means any temporary Condemnation or confiscation
         of the use or occupancy of any of the Leased Premises by any
         governmental or quasi-governmental authority, civil or military,
         whether pursuant to an agreement with such governmental or
         quasi-governmental authority in settlement of or under threat of any
         such requisition or confiscation, or otherwise.

                  "State" means the State of Arizona, being the state in which
         the Leased Premises are situated.

                  "Taking" means any taking of any portion of the Leased
         Premises in or by Condemnation or other eminent domain proceedings
         pursuant to any Law, general or special, or by reason of any agreement
         with any condemnor in settlement of or under threat of any such
         Condemnation or other eminent domain proceedings or by any other means,
         or any de facto Condemnation.

                  "Term" has the meaning given to it in Section 5.

                  "Termination Date" has the meaning given to it in Section
         13(b).

                  "Trade Fixtures" means (a) all fixtures, equipment and other
         items of personal property which are owned by Tenant and used in the
         operation of the business conducted on the Leased Premises and (b)
         without limiting the foregoing, (i) all kitchen fixtures, (ii) the
         reverse osmosis deionizers (including without limitation the three
         demineralizing beds and three CDI's), (iii) the nitrogen generation
         system, (iv) those air compressors specifically listed on Schedule 1
         attached hereto and made a part hereof, (v) any and all telephone
         systems (except for cables and wires permanently installed), (vi) any
         and all computer network systems, and (vii) any and all fitness
         equipment.

                  "UCC" means the Uniform Commercial Code as enacted from time
         to time under the Laws of the State.

                                        4
<PAGE>
         3.       Title and Condition.

                  (a)      The Leased Premises are demised and let subject to
(i) the rights of parties in possession, if any, and the existing state of title
of the Leased Premises, including without limitation the Permitted Encumbrances,
as of the commencement of the Term, (ii) any state of facts which an accurate
survey or physical inspection of the Leased Premises might show, (iii) all Legal
Requirements (including without limitation applicable building codes and zoning
ordinances), Insurance Requirements and existing contracts, including without
limitation any existing violation of any of the foregoing, and (iv) the
condition of the Leased Premises as of the commencement of the Term, including
without limitation any existing conditions relating to Hazardous Substances,
without representation or warranty by Landlord; it being understood and agreed,
however, that the recital of the Permitted Encumbrances herein shall not be
construed as a revival of any thereof which for any reason may have expired.

                  (b)      Tenant acknowledges that the Leased Premises are in
good condition and repair at the inception of this Lease, the interior
improvements thereof having been constructed on behalf of Tenant by a contractor
of its choice. LANDLORD HAS NOT MADE AND WILL NOT MAKE ANY INSPECTION OF ANY OF
THE LEASED PREMISES, AND LANDLORD LEASES AND WILL LEASE AND TENANT TAKES AND
WILL TAKE THE LEASED PREMISES "AS IS", AND TENANT ACKNOWLEDGES THAT LANDLORD
(WHETHER ACTING AS LANDLORD HEREUNDER OR IN ANY OTHER CAPACITY) HAS NOT MADE AND
WILL NOT MAKE, NOR SHALL LANDLORD BE DEEMED TO HAVE MADE, ANY WARRANTY OR
REPRESENTATION, EXPRESS OR IMPLIED, WITH RESPECT TO ANY OF THE LEASED PREMISES,
INCLUDING WITHOUT LIMITATION ANY WARRANTY OR REPRESENTATION AS TO ITS
SUITABILITY OR FITNESS FOR USE OR PURPOSE, DESIGN OR CONDITION FOR ANY
PARTICULAR USE OR PURPOSE, AS TO THE QUALITY OF THE MATERIAL, CONSTRUCTION OR
WORKMANSHIP THEREIN, LATENT OR PATENT, AS TO LANDLORD'S TITLE THERETO, OR AS TO
VALUE, COMPLIANCE WITH SPECIFICATIONS, LOCATION, USE, CONDITION,
MERCHANTABILITY, QUALITY, DESCRIPTION, DURABILITY OR OPERATION, IT BEING AGREED
THAT ALL RISKS INCIDENT THERETO ARE TO BE BORNE SOLELY BY TENANT. TENANT
ACKNOWLEDGES THAT THE LEASED PREMISES ARE OF ITS SELECTION AND TO ITS
SPECIFICATIONS, AND THAT THE LEASED PREMISES HAVE BEEN INSPECTED BY TENANT AND
ARE SATISFACTORY TO IT.

                                        5
<PAGE>
IN THE EVENT OF ANY DEFECT OR DEFICIENCY IN ANY OF THE LEASED PREMISES OF ANY
NATURE, WHETHER PATENT OR LATENT, LANDLORD SHALL NOT HAVE ANY RESPONSIBILITY OR
LIABILITY WHATSOEVER WITH RESPECT THERETO, INCLUDING WITHOUT LIMITATION FOR ANY
INCIDENTAL OR CONSEQUENTIAL DAMAGES (INCLUDING WITHOUT LIMITATION STRICT
LIABILITY IN TORT) AND TENANT HEREBY RELEASES LANDLORD FROM ANY RESPONSIBILITY
OR LIABILITY RELATING TO ANY CONDITIONS WHATSOEVER RESPECTING THE CONDITION OF
THE LEASED PREMISES EXCEPT AS CAUSED BY LANDLORD'S NEGLIGENCE OR WILFUL
MISCONDUCT. THE PROVISIONS OF THIS SECTION 3(b) HAVE BEEN NEGOTIATED, AND THE
FOREGOING PROVISIONS ARE INTENDED TO BE A COMPLETE EXCLUSION, RELEASE AND
NEGATION OF ANY REPRESENTATIONS OR WARRANTIES BY LANDLORD, EXPRESS OR IMPLIED,
WITH RESPECT TO ANY OF THE LEASED PREMISES, ARISING PURSUANT TO THE UCC OR ANY
OTHER LAW NOW OR HEREAFTER IN EFFECT OR OTHERWISE.

                  (c)      Tenant represents to Landlord that Tenant has
examined the title to the Leased Premises prior to the execution and delivery of
this Lease and has found the same to be satisfactory for the purposes
contemplated hereby and acknowledges that title is in Landlord and that Tenant
has only the right of possession and use of the Leased Premises as provided in
this Lease.

                  (d)      Landlord hereby assigns, without recourse or warranty
whatsoever, to Tenant, the right to enforce all warranties, guaranties and
indemnities, if any, express or implied, and similar rights, if any, which
Landlord may or may not have against any manufacturer, seller, engineer,
contractor or builder in connection with the Leased Premises, including, but not
limited to, any rights and remedies existing under contract or pursuant to the
UCC. Such assignment shall remain in effect so long as no Event of Default
exists hereunder or until the termination of this Lease, whereupon any interest
so assigned hereunder to Tenant shall be deemed automatically reassigned to
Landlord without further act or deed. Landlord shall also retain the right to
enforce any such warranty, guaranty, or indemnity. Landlord hereby agrees to
execute and deliver at Tenant's expense such further documents as Tenant may
reasonably request (and which in the good faith judgment of Landlord, do not
adversely affect Landlord), in order that Tenant may have the full benefit of
the assignment effected or intended to be effected by this Section 3(d).

                                        6
<PAGE>
                  (e)      Landlord agrees to enter into with Tenant, at
Tenant's expense, such easements, covenants or restrictions for utilities,
parking or other matters as necessary for operation of the Leased Premises as
requested by Tenant, subject to Landlord's approval thereof, not to be
unreasonably withheld.

                  (f)      Tenant and Landlord agree that their relationship is
that of Landlord and Tenant, and there is no intention by either party that this
Lease Agreement be construed as a loan, partnership or joint venture. Tenant
represents to Landlord that it engaged legal counsel to review this Agreement,
and understands fully the rights and duties of a Tenant pursuant to this
Agreement, and in this connection, Tenant, with advice of legal counsel, waives
any rights to raise any defenses to an action by Landlord to enforce the terms
of this Lease Agreement, that would portray (or bring an action that would
assert) this Lease Agreement as a loan, partnership or joint venture or any
other arrangement other than a Lease.

         4.       Use of Leased Premises; Quiet Enjoyment.

                  (a)      The Leased Premises may be used (i) in the same
manner as Tenant's use and purpose as of the Commencement Date, or a use related
thereto, or (ii) for any other legal purpose upon Landlord's prior written
consent (not to be unreasonably withheld), in either case subject to the
provisions of Section 17. Tenant acknowledges and agrees that it shall be
reasonable for Landlord to object to the use of the Leased Premises, or any
portion thereof, if (among other things) such use (a) creates a detrimental
environmental effect or increases environmental risks to the Leased Premises or
liability risks to Landlord, (b) creates or requires material and adverse
modifications to the physical structure of any portion of the Leased Premises,
(c) will materially lessen the fair market value of the Leased Premises, or (d)
materially and adversely changes the primary character of the Leased Premises.
In no event shall the Leased Premises be used for any purpose which would
otherwise violate any of the provisions of this Lease, including but not
limited to, Legal Requirements, Insurance Requirements or other recorded
covenants, restrictions or agreements applicable to the Leased Premises.

                  (b)      Tenant shall not permit any unlawful occupation,
business or trade to be conducted on any of the Leased Premises or any use to be
made thereof contrary to applicable Legal Requirements or Insurance
Requirements. Tenant shall not use, occupy or permit any of the Leased Premises
to be used or occupied, nor do or permit anything to be done in or on any of the
Leased Premises, in a manner which

                                        7
<PAGE>
would (i) violate any certificate of occupancy or equivalent certificate
affecting any of the Leased Premises, (ii) make void or voidable any Insurance
then in effect with respect to any of the Leased Premises, (iii) affect in any
manner the ability of Tenant to obtain fire or other Insurance which Tenant is
required to furnish hereunder, (iv) cause any Injury or damage to any of (the
Improvements, ordinary wear and tear excepted, or (v) constitute a public or
private nuisance or waste.

                  (c)      Subject to all of the provisions of this Lease,
including but not limited to the provisions of Section 3 and Section 7(b), so
long as no Event of Default exists hereunder, Landlord covenants to do no act to
disturb the peaceful and quiet occupation and enjoyment of the Leased Premises
by Tenant, provided that Landlord may enter upon and examine any of the Leased
Premises at reasonable times (except in the case of emergencies, when Landlord
may access the Leased Premises at any time) and exercise any rights and
privileges granted to Landlord under the provisions of this Lease or provided by
Law.

         5.       Term. Subject to the provisions hereof, Tenant shall have and
hold the Leased Premises for an initial term (the "Term") commencing on December
26,1996 (the "Commencement Date" and ending on December 31, 2011. Provided this
Lease shall not have been terminated pursuant to any provision of this Lease,
including but not limited to Section 19, Tenant shall have the option to extend
the Term for two (2) renewal terms of five (5) years each, by giving written
notice to Landlord in writing at least twelve (12) months, but not more than
eighteen (18) months, prior to the expiration of the then-current term. Any
option granted to Tenant to extend the Term hereunder for any of the two renewal
terms of five (5) years each is on the condition that at the time of the
exercise of the option and at the time of the commencement date of each such
renewal term, no Event of Default shall exist. In the absence of giving of such
notice to renew by Tenant to Landlord, the Term shall be automatically
terminated at the end of the then-current Term. Any such extension or renewal
of the Term (also referred to as the Term") shall be subject to and shall
continue in full force and effect all the provisions of this Lease. In the event
that Tenant does not exercise its option to renew or to further renew the Term
as hereinabove provided, then Landlord shall have the right during the remainder
of the Term then in effect to (i) advertise the availability of the Leased
Premises for sale or for reletting and to erect upon the Leased Premises signs
indicating such availability (provided that such signs do not unreasonably
interfere with the use of the Leased Premises by Tenant), and (ii) show the
Leased Premises to prospective

                                        8
<PAGE>
purchasers, lenders or tenants at such reasonable times during normal business
hours as Landlord may select. If Tenant shall fail to timely give such notice of
its irrevocable election to exercise any renewal option, then Tenant's right to
exercise such option and all options with regard to subsequent extensions or
renewals of the Term shall expire and be null and void.

         Tenant shall remove all Trade Fixtures by the expiration or earlier
termination of this Lease and shall repair any damage occasioned by the removal
of the Trade Fixtures. If the Trade Fixtures are not removed by this time, at
the option of Landlord such Trade Fixtures may be deemed abandoned and become
the property of Landlord without any further action and Landlord may remove some
or all of such Trade Fixtures and dispose of them as Landlord deems appropriate,
all at the cost and expense of Tenant.

         6.       Rent; Security Deposit.

                  (a)      Tenant shall pay to Landlord, as annual rent during
the Term, the amounts determined in accordance with the schedule set forth in
Exhibit "C" attached hereto made a part hereof ("Basic Rent"), commencing on the
first day of the first month next following the Commencement Date and continuing
on the same day of each month thereafter during the Term (the said days being
called the "Basic Rent Payment Dates"), and shall pay the same at Landlord's
address set forth below, or at such other place as Landlord from time to time
may designate to Tenant in writing, in funds which at the time of such payment
shall be legal tender for the payment of public or private debts in the United
States of America. Pro rata Basic Rent shall be due for the period from the
Commencement Date through the first day of the month next following the
Commencement Date computed as set forth in Exhibit "C" and shall be paid in
advance on the Commencement Date, but if the Commencement Date shall occur on
the first day of a calendar month, full monthly installment of Basic Rent shall
be paid on the Commencement Date.

                  (b)      Tenant shall pay and discharge when the same shall
become due, as additional rent, all other amounts, liabilities and obligations
which Tenant assumes or agrees to pay or discharge pursuant to this Lease,
together with every fine, penalty, interest and cost which may be added for
nonpayment or late payment thereof. In the event of any failure by Tenant to pay
or discharge any of the foregoing, Landlord shall have all rights, powers and
remedies provided herein, by Law or otherwise, in the event of nonpayment of
Basic Rent. Tenant shall also pay to Landlord on demand, as additional rent,
interest, at the rate of interest

                                        9
<PAGE>
equal to the "prime rate" of interest charged Wells Fargo Bank at its offices in
Phoenix, Arizona (or, if unavailable, any successor rate or bank chosen by
Landlord in its reasonable discretion) plus five percent (5.0%) per annum (the
"Default Rate"), on all overdue installments of Basic Rent from and after the
expiration of any applicable grace period(s) provided in Section 19(d) of this
Lease, and on all overdue amounts of additional rent relating to obligations
which Landlord shall have paid on behalf of Tenant, from the date of payment
thereof, until paid in full. In addition, Tenant shall pay to Landlord, on
account of each overdue installment of Basic Rent, the sum of $1,000 to
compensate Landlord for its administrative and collection costs associated with
such overdue installment. All the foregoing additional rent referred to in this
Section 6(b) is herein sometimes called "Additional Rent". Landlord shall comply
with the requirements of Section 19(d) regarding notice and grace periods prior
to the imposition of the Additional Rent charges of this Section 6(b).

                  (c)      Tenant has deposited, and Landlord acknowledges
receipt of, a security deposit (herein the "Security Deposit") in the amount of
$250,000 as security for Tenant's payment and performance of its obligations
hereunder. During the existence of an Event of Default, Landlord may apply the
Security Deposit for the payment of any amount due Landlord hereunder and
Tenant shall promptly deposit moneys with Landlord sufficient to restore said
Security Deposit to the full amount required by this Lease. Until the Deposit
Increase Date described below, the Security Deposit shall be held in the form of
United States Treasury instruments having a maturity date of not less than one
year; interest accruing thereon shall be drawn down within ninety (90) days
following the end of each Lease year and promptly distributed 50.0% to Landlord
and (unless an Event of Default shall have occurred and be continuing) 50.0% to
Tenant. From and after the Deposit Increase Date, the Security Deposit shall not
be commingled with Landlord's general funds and shall be held in a
federally-insured or -guaranteed financial institution, in an interest-bearing
account accruing for Landlord's benefit. On or before December 31, 2001 (the
"Deposit Increase Date") Tenant shall deposit a sum sufficient to increase the
Security Deposit to the amount of $350,000, and on and after that date the
Security Deposit shall be deemed to mean such increased amount. Landlord shall,
within ten (10) business days after the expiration or earlier termination of the
Term, return to Tenant that portion of the Security Deposit not used or applied
by Landlord.

                                       10
<PAGE>
         7.       Net Lease; Non-Terminability.

                  (a)      This is an absolutely net Lease to Landlord. Tenant
and Landlord agree that the Basic Rent, Additional Rent and all other sums
payable hereunder by Tenant shall be paid without notice or demand, and without
setoff, counterclaim, recoupment, abatement, suspension, deferment, diminution,
deduction, reduction or defense and shall be an absolutely net return to
Landlord. Tenant shall pay all costs and expenses relating to the Leased
Premises and the business carried on therein, unless otherwise expressly
provided in this Lease. Any amount or obligation herein relating to the Leased
Premises which is not expressly declared to be that of Landlord shall be deemed
to be an obligation of Tenant to be performed by Tenant at Tenant's sole cost
and expense.

                  (b)      This Lease shall not terminate and Tenant shall not
have any right to terminate this Lease during the Term except as otherwise
expressly provided in Section 13. Tenant shall not be entitled to any setoff,
counterclaim, recoupment, abatement, suspension, deferment, diminution,
deduction, reduction or defense of or to Basic Rent, Additional Rent or any
other sums payable under this Lease except as otherwise expressly provided in
Section 13. The obligations of Tenant under this Lease shall not be affected by
any interference with Tenant's use of any of the Leased Premises for any reason,
including without limitation the following: (i) any damage to or destruction of
any of the Leased Premises by any cause whatsoever, (ii) any Condemnation, (iii)
the prohibition, limitation or restriction of Tenant's use of any of the Leased
Premises under applicable Law, (iv) any latent or other defect in, or any theft
or loss of any of the Leased Premises or (v) any other cause, whether similar or
dissimilar to the foregoing, including without limitation any default, breach,
act or omission of Landlord (any present or future Law to the contrary
notwithstanding). It is the intention of the parties hereto that the obligations
of Tenant hereunder shall be separate and independent covenants and agreements,
and the Basic Rent, Additional Rent and all other sums payable by Tenant
hereunder shall continue to be payable in all events and that all of the
obligations of Tenant hereunder shall continue unaffected, unless the
requirement to pay or perform the same shall have been terminated pursuant to
Section 13. Notwithstanding anything to the contrary contained in this Section,
Tenant retains a separate and independent right to sue Landlord for among other
things any act or failure to act in connection herewith;

                                       11
<PAGE>
provided, however, any judgment in favor of Tenant shall not abate Basic Rent,
Additional Rent and all other sums payable by Tenant hereunder or terminate
Tenant's obligations hereunder.

                  (c)      Tenant agrees that it shall remain obligated under
this Lease in accordance with its provisions and that, except as otherwise
expressly provided in Section 13, it shall not take any action to terminate,
rescind or avoid this Lease, notwithstanding (i) the bankruptcy, insolvency,
reorganization, composition, readjustment, liquidation, dissolution, winding-up
or other proceeding affecting Landlord, (ii) the exercise of any remedy,
including foreclosure, under the Mortgage, or (iii) any action with respect to
this Lease (including without limitation the disaffirmance hereof) which may be
taken by Landlord under the Federal Bankruptcy Code or by any trustee, receiver
or liquidator of Landlord or by any court under the Federal Bankruptcy Code or
otherwise.

                  (d)      Tenant waives all rights which may now or hereafter
be conferred by Law (i) to quit, terminate or surrender this Lease or any of the
Leased Premises, and (ii) to any setoff, counterclaim, recoupment, abatement,
suspension, deferment, diminution, deduction, reduction or defense of or to
Basic Rent, Additional Rent or any other sums payable under this Lease, in
either case except as otherwise expressly provided in Section 13.

                  (e)      Notwithstanding anything to the contrary contained in
this Lease, Tenant retains a separate and independent right to sue Landlord;
provided, however, that any judgment in favor of Tenant shall not abate Basic
Rent, Additional Rent and all other sums payable by Tenant hereunder or
terminate Tenant's obligations hereunder.

         8.       Payment of Impositions; Compliance with Legal Requirements and
Insurance Requirements.

                  (a)      Subject to the provisions of Section 18 relating to
contests, Tenant shall, before interest or penalties are due thereon, pay and
discharge (i) all taxes, assessments (including without limitation assessments
for benefits from public works or improvements, whether or not begun or
completed prior to the commencement of the term of this Lease and whether or not
to be completed within said term, if the same are due during the term of this
Lease), levies, fees, water and sewer rents and charges, and all other
governmental charges of every kind, general and special, ordinary and
extraordinary, whether or not the same shall have been within the express
contemplation of the parties hereto, together with any interest and penalties

                                       12
<PAGE>
thereon, which are, at any time, imposed or levied upon or assessed against (A)
the Leased Premises or any part thereof, (B) any Basic Rent, any Additional Rent
reserved or payable hereunder, (C) this Lease or the leasehold estate hereby
created or which arise in respect of the operation, possession, occupancy or use
of the Premises; (ii) any gross receipts or similar taxes imposed or levied
upon, assessed against or measured by the Basic Rent, Additional Rent or any
other sums payable by Tenant hereunder or levied upon or assessed against the
Leased Premises; (iii) all sales and use taxes which may be levied or assessed
against or payable by Landlord or Tenant on account of the acquisition, leasing
or use of the Leased Premises or any portion thereto; and (iv) all charges for
water, gas, light, heat, telephone, electricity, power and other utilities and
services rendered or used on or about the Leased Premises (collectively the
"Impositions"). Upon written request from Landlord, Tenant shall within thirty
(30) days thereafter furnish paid receipts or other evidence that the
Impositions are not delinquent.

                  Nothing in this Section shall obligate Tenant to pay federal,
state or local (i) franchise, capital stock or similar taxes, if any, of
Landlord, (ii) income, excess profits or similar taxes, if any, of Landlord,
determined on the basis of its net income, or (iii) any estate, inheritance,
succession, gift, capital levy or similar tax unless the taxes referred to in
clauses (i) and (ii) above are in addition to or in lieu of or a substitute for
any other tax or assessment upon or with respect to any of the Leased Premises
which, if such other tax or assessment were in effect at the commencement of the
Term, would be payable by Tenant. In the event that any assessment against any
of the Leased Premises may be paid in installments, Tenant shall have the option
to pay such assessment in installments; and in such event, Tenant shall be
liable only for those installments which become due and payable during or are
allocable to the Term. Tenant shall prepare and file all tax reports required by
governmental authorities which relate to the Impositions. Tenant shall deliver
to Landlord, within twenty (20) days of receipt thereof, copies of all
settlements and notices pertaining to the Impositions which may be issued by any
governmental authority and receipts for payments of all Impositions made during
each calendar year of the Term, within thirty days after payment.

                  (b)      Tenant, at its cost and expense, shall promptly
comply with and conform to and cause the Leased Premises to comply with and
conform to all of the Legal Requirements and Insurance Requirements, subject to
the provisions of Section 18.

                                       13
<PAGE>
         9.       Liens; Recording and Title.

                  (a)      Tenant shall not, directly or indirectly, create or
permit to be created or to remain, and shall promptly discharge at its expense,
any lien, encumbrance or charge on any of the Leased Premises, on the Basic
Rent, Additional Rent or on any other sums payable by Tenant under this Lease,
other than the Mortgage, the Assignment, the Permitted Encumbrances and any
mortgage, lien, encumbrance or other charge created by or resulting from any act
or omission by Landlord, not resulting from a default by Tenant hereunder.
NOTICE IS HEREBY GIVEN THAT LANDLORD SHALL NOT BE LIABLE FOR ANY LABOR, SERVICES
OR MATERIALS FURNISHED OR TO BE FURNISHED TO TENANT, OR TO ANYONE HOLDING ANY OF
THE LEASED PREMISES THROUGH OR UNDER TENANT, AND THAT NO MECHANIC'S OR OTHER
LIENS FOR ANY SUCH LABOR, SERVICES OR MATERIALS SHALL ATTACH TO OR AFFECT THE
INTEREST OF LANDLORD IN AND TO ANY OF THE LEASED PREMISES. This notice shall be
included in the memorandum of this Lease to be filed pursuant to Section 33(1).

                  (b)      Upon demand by Landlord, Tenant shall execute,
deliver and record, file or register from time to time all such instruments as
may be required by any present or future Law in order to evidence the
respective interest of Landlord and Tenant in any of the Leased Premises, and
shall cause a memorandum of this Lease, and any supplement hereto or to such
other instrument, if any, as may be appropriate, to be recorded, filed or
registered and re-recorded, refiled or re-registered in such manner and in such
places as may be required by any present or future Law in order to give public
notice and protect the validity of this Lease. In the event of any discrepancy
between the provisions of said recorded memorandum of this Lease or any other
recorded instrument referring to this Lease and the provisions of this Lease,
the provisions of this Lease shall prevail.

                  (c)      Nothing in this Lease and no action or inaction by
Landlord shall be deemed or construed to mean that Landlord has granted to
Tenant any right, power or permission to do any act or to make any agreement
which may create, give rise to, or be the foundation for, any right, title,
interest or lien in or upon the estate of Landlord in any of the Leased
Premises.

         10.      Indemnification. Tenant agrees to defend, pay, protect,
indemnify, save and hold harmless Landlord for, from and against any and all
liabilities, losses, damages, penalties, costs, expenses (including

                                       14
<PAGE>
without limitation reasonable attorneys' fees and expenses), causes of action,
suits, claims, demands or judgments of any nature whatsoever, howsoever caused,
arising from or relating to (a) any of the Leased Premises or Adjoining Property
or the use, non-use, occupancy, condition, design, construction, maintenance,
repair or rebuilding of any of the Leased Premises or Adjoining Property, and
any injury to or death of any person or persons or any loss of or damage to any
property, real or personal, in any manner arising therefrom connected therewith
or occurring thereon, whether or not Landlord has or should have knowledge or
notice of the defect or conditions, if any, causing or contributing to said
injury, death, loss, damage or other claim, (b) any violation by Tenant of any
provision of this Lease, of any contract or agreement to which Tenant is a
party, including but not limited to any violation of any Insurance Requirement
or Legal Requirement or Permitted Encumbrance, or (c) any other cause not
resulting from the negligence or wilful misconduct of Landlord or its officers,
directors, employees or others in privity of contract in connection with the
Leased Premises or this Lease. In case any proceeding is brought against
Landlord by reason of any such claim, Tenant covenants upon notice from Landlord
to resist or defend Landlord in such action, with the expenses of such defense
paid by Tenant, and Landlord will cooperate and assist in the defense of such
action or proceeding if reasonably requested so to do by Tenant. The obligations
of Tenant under this Section 10 shall survive any termination of this Lease.

         11.      Maintenance and Repair.

                  (a)      Tenant acknowledges that it has received the Leased
Premises in good condition, repair and appearance. Tenant agrees that, at its
expense, Tenant shall at all times, including without limitation any Requisition
period, put, keep and maintain the Leased Premises, including, without
limitation, the roof, landscaping, walls and structural components of the Leased
Premises, and the Adjoining Property, and any altered, rebuilt, additional or
substituted buildings, structures or other improvements, in good repair and
appearance, except for ordinary wear and tear, and shall promptly make all
repairs and replacements (substantially equivalent in quality and workmanship to
the original work) of every kind and nature, whether foreseen or unforeseen,
structural or non-structural, which may be required to be made upon or in
connection with any of the Leased Premises in order to keep and maintain the
Leased Premises in compliance with all Legal Requirements and Insurance
Requirements and in as good repair and appearance as they were originally,

                                       15
<PAGE>
except for ordinary wear and tear. Tenant shall do or cause others to do all
shoring of the Leased Premises or Adjoining Property or of foundations and walls
of the Improvements and every other act necessary or appropriate for
preservation and safety thereof, by reason of or in connection with any
excavation or other building operation upon any of the Leased Premises or
Adjoining Property, whether or not Landlord shall, by reason of any Legal
Requirements or Insurance Requirements, be required to take such action or be
liable for failure to do so. Landlord shall not be required to make any repair,
whether foreseen or unforeseen, or to maintain any of the Leased Premises or
Adjoining Property in any way, and Tenant hereby expressly waives the right to
make repairs at the expense of Landlord, which right may be provided for in any
Law now or hereafter in effect. Tenant shall, in all events, make all repairs
promptly upon written notice from Landlord, and all repairs shall be in a good,
proper and workmanlike manner.

                  (b)      In the event that any Improvement now or hereafter
constructed encroaches upon any property, street or right-of-way adjoining any
of the Leased Premises or Adjoining Property, violates any Legal Requirements,
Insurance Requirements or the provisions of any restrictive covenant affecting
any of the Leased Premises, hinders or obstructs any easement or right-of-way to
which any of the Leased Premises is subject, or impairs the rights of others in,
to or under any of the foregoing, then, promptly after written request of
Landlord, Tenant shall either (i) obtain valid and effective waivers or
settlements of all claims, liabilities and damages resulting from each such
encroachment, violation, hindrance, obstruction or impairment, whether the same
shall affect Landlord, Tenant or both, or (ii) take such action as shall be
necessary to remove such encroachment, violation, hindrance, obstruction or
impairment including, if necessary, an Alteration. Any such repair or Alteration
shall be made in conformity with the applicable provisions of Section 12.

         12.      Alterations. Except as otherwise expressly provided in this
Section 12, Tenant shall not make any Alterations which would tend to impair the
value of the Leased Premises, or the usefulness or structural integrity thereof,
without Landlord's written consent, not to be unreasonably withheld.
Notwithstanding the above, Tenant may make non-structural Alterations without
the prior written consent of Landlord. In the event that Landlord gives its
prior written consent to any Alterations, or if such consent is not required,
Tenant agrees that in connection with any Alteration (a) the value of the Leased
Premises shall not be lessened by any such Alteration, or its usefulness or
structural integrity impaired, (b) the Alteration shall not change the general

                                       16
<PAGE>
character of the Improvements, or materially reduce the useable square footage
of the Improvements, (c) all such Alterations shall be performed in a good and
workmanlike manner, and shall be expeditiously completed in compliance with all
Legal Requirements, (d) all work done in connection with any such Alteration
shall comply with all Insurance Requirements, (e) Tenant shall promptly pay all
costs and expenses of any such Alteration, and shall discharge all liens filed
against any of the Leased Premises arising out of the same, (f) Tenant shall
procure and pay for all permits and licenses required in connection with any
such Alteration, (g) all such Alterations shall be the property of Landlord and
shall be subject to this Lease, (h) Alterations may only be performed if Tenant
is otherwise in compliance with terms and conditions of this Lease; and (i) all
Alterations shall be made (except in the case of any Alteration the estimated
cost of which in any one instance does not exceed $75,000) under the supervision
of an Arizona licensed architect or engineer, reasonably satisfactory to
Landlord, in accordance with detailed plans and specifications approved by
Landlord, approval not to be unreasonably withheld.

         13.      Condemnation.

                  (a)     Subject to the rights of Tenant set forth in this
Section 13, Tenant hereby irrevocably assigns to Landlord any award or payment
to which Tenant may be or become entitled with respect to the Taking of the
Leased Premises or any part thereof, by Condemnation or other eminent domain
proceedings pursuant to any Law, general or special, or by reason of the
temporary Taking of the use or occupancy of the Leased Premises or any part
thereof, by any governmental authority, civil or military, whether the same
shall be paid or payable in respect of Tenant's leasehold interest hereunder or
otherwise. Landlord shall be entitled to participate in any such proceeding and
the expenses thereof (including without limitation reasonable attorneys' fees
and expenses) shall be paid by Tenant. Nothing in this Lease shall be deemed to
(i) assign to Landlord any award or payment on account of Tenant's Trade
Fixtures, or Tenant's other tangible personal property, moving expenses and
similar claims, if available, to the extent Tenant shall have a right to make a
separate claim therefor against the condemnor or (ii) impair Tenant's right to
any such award or payment so long as such claim is not based upon the value of
Tenant's leasehold interest.

                  (b)      If during the term of this Lease (i) the entire
Leased Premises shall be taken by or on account of any actual or threatened
Condemnation or other eminent domain proceeding pursuant to any law,

                                       17
<PAGE>
general or special or (ii) if 25% or more of the Improvements or 25% or more of
the Land is taken and said Taking renders the remaining Leased Premises
uneconomic for the continued use or occupancy in the business of Tenant in the
reasonable business judgment of Tenant's board of directors, then Tenant shall
deliver a Purchase Offer (the "Purchase Offer") to Landlord specifying a
termination date (the "Termination Date") occurring not less than ninety (90)
nor more than one hundred eighty (180) days after the delivery of such Purchase
Offer and this Lease shall continue in full force and effect without any
abatement of rent, notwithstanding any Taking, until the Termination Date.
The Purchase Offer shall be accompanied by Tenant's certificate stating that
the conditions set forth in either clause (i) or (ii) of this Section 13(b) have
been fulfilled. If the conditions set forth in clause (i) or (ii) of this
Section 13(b) are fulfilled and if Tenant shall have failed to deliver a
Purchase Offer as required above, Tenant conclusively shall be presumed to have
made a Purchase Offer on a date which is seventy-five (75) days after any such
Taking (or such later date as is agreed to in writing by Landlord), and in the
event Tenant is so presumed to have made a Purchase Offer, the Termination Date
shall be deemed to be one hundred twenty (120) days after such Purchaser Offer
is presumed to have been made; but nothing in this sentence shall relieve Tenant
of its obligation actually to deliver such Purchase Offer.

                  (c)      If during the Term (i) a portion of the Leased
Premises shall be taken by condemnation or other eminent domain proceedings,
which Taking is not sufficient to require that Tenant give a Purchase Offer or
(ii) the use or occupancy of the Leased Premises or any part thereof shall be
temporarily taken by any governmental authority; then this Lease shall continue
in full effect without abatement or reduction of Basic Rent, Additional Rent or
other sums payable by Tenant hereunder notwithstanding such partial or temporary
Taking. Tenant shall, promptly after any such temporary Taking ceases, at its
expense, repair any damage caused thereby in conformity with the applicable
requirements of Section 12 so that, thereafter, the Leased Premises shall be, as
nearly as commercially and reasonably possible, in a condition as good as the
condition thereof immediately prior to such Taking. In the event of any such
partial Taking, Landlord shall make the Net Award available to Tenant to make
such repair but, if such Net Award shall be in excess of $75,000, only against
certificates of Tenant delivered to Landlord from time to time as such work or
repair progresses, each such certificate describing the work or repair for which
Tenant is requesting payment and the cost incurred

                                       18
<PAGE>
by Tenant in connection therewith and stating that Tenant has not theretofore
received payment for such work. Any Net Award remaining after such repairs have
been made shall be delivered to Landlord and shall not reduce Tenant's
obligation to pay Basic Rent hereunder. In the event of such temporary
Requisition, Tenant shall be entitled to receive the entire Net Award payable by
reason of such temporary Requisition or portion of such temporary Requisition
occurring during the term hereof. If the cost of any repairs required to be made
by Tenant pursuant to this Section 13(c) shall exceed the amount of the Net
Award, the deficiency shall be paid by Tenant. Notwithstanding anything in
this Section 13 to the contrary, during any period of time when there continues
to exist an Event of Default, Landlord, in the exercise of its sole and absolute
discretion, shall have the right to receive any payments pursuant to this
Section 13(c) and to apply the same toward payment of any delinquent Basic Rent
or Additional Rent then due and owing to Landlord under this Lease until such
Event of Default is cured.

                  (d)      Landlord may reject any Purchase Offer but must do so
not later than the thirtieth (30th) day prior to the Termination Date or the
purchase date specified in such Purchase Offer, whereupon this Lease shall
terminate on such date (except with respect to obligations and liabilities of
Tenant under this Lease, actual or contingent, which have arisen on or prior to
such termination), upon payment by Tenant of the Basic Rent, Additional Rent and
all other sums then due and payable hereunder to and Including the date of
termination without offset or deduction for any reason. Upon a purchase of the
Leased Premises pursuant to Section 13(c) and the payment to Landlord of the
amount determined in accordance with Exhibit "E" attached hereto and made a part
hereof (the "Purchase Price"), Landlord shall convey the Leased Premises and all
its right, title and interest in and to the Net Award, (whether or not such Net
Award shall have been received by Landlord) to Tenant or its designee.

                  (e)      Any minor Condemnation or Taking of the Leased
Premises for the construction or maintenance of streets or highways shall not be
considered a Condemnation or Taking for purposes of this Section 13 so long as
the Leased Premises shall not be materially or adversely affected, ingress and
egress for the remainder of the Leased Premises shall be adequate for the
business of Tenant and the provisions of any Mortgage relating thereto shall be
complied with. Tenant agrees that it will notify Landlord of any such
Condemnation or Taking.

                                       19
<PAGE>
                  (f)      If the Leased Premises or any part thereof shall be
purchased by Tenant pursuant to any provision of this Lease, Landlord need not
transfer and convey to Tenant or its designee any better title thereto than
existed on the date of the commencement of this Lease. Tenant shall accept such
title, subject, to such liens, encumbrances, charges, exceptions and
restrictions on, against or relating to the Leased Premises (including without
limitation those arising pursuant to the terms of this Lease) and to all
applicable laws, regulations and ordinances, but free of the Mortgage and all
other mortgages, liens, encumbrances, charges, exceptions and restrictions which
shall have been created by acts of Landlord. Notwithstanding the thirty-day
time limit in Section 13(d), Landlord's inability to deliver such title in such
condition on the date fixed for any such purchase shall be deemed to be
Landlord's rejection of the Purchase Offer pursuant to Section 13(d) as of and
effective on such date.

                  (g)      On the date fixed for any such purchase, Tenant shall
pay to Landlord, at any place within the United States of America designated by
Landlord, the Purchase Price as determined pursuant to Exhibit "E". together
with all installments of Basic Rent and all other sums then due under this Lease
and unpaid to and including the date of purchase without offset or deduction for
any reason, and Landlord shall deliver to Tenant a special warranty deed
conveying title to the Leased Premises of the character described in Section
13(f) above and describing the Leased Premises or portion thereof being sold and
conveying the title thereto, together with such instruments as shall be
necessary to transfer to Tenant or its designee any other property then required
to be transferred by Landlord pursuant to this Lease. Tenant shall pay all
reasonable charges incident to such conveyance and transfer, including without
limitation counsel fees, escrow fees, recording fees, title insurance premiums
and all applicable federal, state and local taxes (other than any income or
franchise taxes levied upon or assessed against Landlord) which may be incurred
or imposed by reason of such conveyance and transfer.

                  (h)      Upon the completion of such purchase, but not prior
thereto (whether or not any delay in the compilation of, or the failure to
complete such purchase shall be the fault of Landlord), this Lease and all
obligations hereunder (including without limitation the obligations to pay Basic
Rent and Additional Rent) shall terminate, except with respect to (i)
obligations and liabilities of Tenant, actual or contingent, under this Lease
which arose on or prior to such date of purchase or (ii) those obligations
contained in Section 10.

                                       20
<PAGE>
         14.      Insurance.

                  (a)      Tenant shall maintain, or cause to be maintained, at
its sole cost and expense the following insurance on the Leased Premises:

                           (i)      Property insurance against loss or damage to
the Improvements under a so-called "all-risk" policy or policies of insurance
(special form), which may contain such exclusions as may be reasonably
acceptable to Landlord, in amounts to prevent Landlord or Tenant from becoming a
co-insurer under the applicable policies, and in any event in amounts not less
than the actual replacement cost of the Improvements (excluding footings and
foundations and other parts of the Improvements which are not insurable) but not
less than the full insurable replacement value of the Improvements, and as
determined from time to time, but not more frequently than once in any 12-month
period, by the insurer or insurers. Such policies shall contain a replacement
cost endorsement. Notwithstanding anything to the contrary in this Section 14,
(i) that portion of the property insurance covering loss or damage on account of
floods shall have a limit of $5,000,000, and (ii) Tenant shall not be required
to obtain or maintain insurance against loss or damage on account of
earthquakes.

                           (ii)     Comprehensive general public liability
insurance against claims for bodily injury, death or property damage occurring
on, in or about any of the Leased Premises or the Adjoining Property, which
insurance shall be written on a so-called "occurrence basis", and shall provide
minimum protection with a combined single limit in an amount not less than the
greater of (x) Twenty-Five Million Dollars ($25,000,000) (or in such increased
limits from time to time to reflect declines in the purchasing power of the
dollar as Landlord may reasonably request) or (y) the aggregate amount of such
insurance carried by Tenant, for bodily injury, death and property damage in any
one occurrence. Tenant shall be required to increase its insurance limits from
time to time as may be reasonably required by Lender or as may reasonably
required by Landlord consistent with coverage on properties similarly
constructed, occupied and maintained. In no event shall the limits of such
insurance be considered as limiting the liability of Tenant under this Lease.

                           (iii)    Workers' compensation insurance covering all
persons employed in connection with any work done on or about any of the Leased
Premises for which claims for death

                                       21
<PAGE>
or bodily injury could be asserted against Landlord, Tenant or the Leased
Premises in compliance with statutory law and employer's liability insurance
with a limit of not less than $200,000 per employee and $1,000,000 per
occurrence.

                           (iv)     Insurance against loss or damage from
explosion of any steam or pressure boilers or similar apparatus located in or
about the Improvements in an amount not less than Five Million Dollars
($5,000,000);

                           (v)      Rental insurance against loss of rental
income under a loss of rents insurance policy covering risk of loss due to the
occurrence of any of the hazards insured against under Tenant's fire and
extended insurance on the building, in an amount sufficient to prevent Landlord
from becoming a co-insurer but in any event, in an amount sufficient to pay for
one (1) year the rent payable under this Lease. All proceeds received by
Landlord will be credited as received against the rent due.

                           (vi)     Builders risk insurance insuring perils
covered by the causes of loss special form (all risk) shall be purchased for
the value of any Alteration and/or additions made to the leased Premises when
the work is not insured under Tenant's property insurance policy.

                           (vii)    Such additional and/or other insurance with
respect to the Leased Premises as Landlord may, from time to time, reasonably
require or which Lender may, from time to time, reasonably require, so long as
such other insurance is in such amounts and of a type as at the time is
customarily carried with respect to improvements similar in character, location
and use to the Improvements then comprising the Leased Premises.

                  (b)      The insurance required by this Section 14 shall be
written and maintained by one or more companies having an insurance company
claims paying rating equal to or stronger than "A-9" by A.M. Best Company, or a
similar rating by a nationally-recognized rating agency. Insurers shall be
approved by Landlord and authorized to do an insurance business in the State
and domiciled in the United States. The insurance policies (i) shall be for a
term of not less than one year, (ii) shall be in amounts sufficient at all times
to satisfy any co-insurance requirements thereof, and (iii) shall (except for
the workers' compensation insurance referred to in Section 14(a)(iii) name
Landlord and any Lender as additional named insured parties and/or loss

                                       22
<PAGE>
payees, as applicable, as their respective interests may appear. If said
insurance or any part thereof shall expire, be withdrawn, become void by breach
of any condition thereof by Tenant or become void or unsafe by reason of the
failure or impairment of the capital of any insurer, or if for any other
reasonable cause said insurance shall become unsatisfactory to Landlord, Tenant
shall immediately obtain new or additional insurance satisfactory to Landlord.
Insurance required under this Section 14 shall be primary and not contributing
to any insurance available to Landlord and Landlord's insurance shall be in
excess thereto.

                  (c) Each insurance policy referred to in
Sections-14(a)(i),-14(a)(ii)-and-14(a)(iv) shall contain standard
noncontributory mortgagee clauses in favor of any Lender. Each policy shall
provide that it may not be canceled except after thirty (30) days prior written
notice to Landlord and any Lender. Each policy shall also provide that any loss
otherwise payable thereunder shall be payable notwithstanding (i) any act or
omission of Landlord or Tenant which might, absent such provision, result in a
forfeiture of all or a part of such insurance payment, (ii) the occupation or
use of any of the Leased Premises for purposes more hazardous than permitted by
the provisions of such policy or (ii) any foreclosure or other action or
proceeding taken by any Lender pursuant to any provision of the Mortgage upon
the happening of an event of default therein.

                  (d) Tenant shall pay as they become due all premiums for the
insurance required by this Section 14, shall renew or replace each policy, and
shall deliver to Landlord or Lender the existing policy and such renewal or
replacement policy at least ten (10) days prior to the expiration date of each
policy and if any such policy be delivered to Lender, Tenant shall deliver to
Landlord a certificate of such policy. In the event of Tenant's failure to
comply with any of the foregoing requirements of this Section 14 and following
the notice and cure periods set forth in this Lease, Landlord shall be entitled
to procure such insurance. Any sums expended by Landlord in procuring such
insurance shall be Additional Rent and shall be immediately repaid by Tenant.

                  (e) Anything in this Section 14 to the contrary
notwithstanding, any insurance which Tenant is required to obtain pursuant to
Section 14(a) may be carried under a so-called "blanket" policy or policies
covering other properties or liabilities of Tenant, provided that such blanket
policy or policies otherwise comply with the provisions of this Section 14. In
the event any such insurance is carried under a blanket policy, Tenant shall
deliver to Landlord and Lender a certified copy of those provisions of the
blanket

                                       23
<PAGE>

policy that pertain to the Leased Premises to evidence the issuance and
effectiveness of the policy, the amount and character of the coverage with
respect to the Leased Premises and the presence in the policy of provisions of
the character required in the above Sections of this Section 14.

                  (f)      (i)      Insurance claims by reason of damage to or
         destruction of any portion of the Leased Premises shall be adjusted by
         Tenant; provided, however, that although Tenant shall make the final
         decision with respect to any such adjustment, Tenant shall, promptly
         after such damage or destruction, advise Landlord and Lender of such
         occurrences and consult with Landlord and Lender throughout the process
         of adjusting any such claim, and provided further that both Landlord
         and Lender are fully advised as to all matters on a current basis.
         Landlord shall not be required to prosecute any claim against, or to
         contact any settlement proposed by, an insurer. Tenant may, at its
         expense, prosecute any such claim or contest any such settlement in the
         name of Landlord, Tenant or both, and Landlord will join therein at
         Tenant's written request upon the receipt by Landlord of an indemnity
         from Tenant against all reasonable costs, liabilities and expenses in
         connection therewith.

                           (ii)     Subject to the provisions of Section 15, Net
         Proceeds shall be made available from Landlord and/or Lender to Tenant,
         but, if such Net Proceeds shall be in excess of $75,000, only against
         certificates of Tenant delivered to Landlord from time to time as such
         work or repair progresses, each such certificate describing the work or
         repair for which Tenant is requesting payment and the cost incurred by
         Tenant in connection therewith and stating that Tenant has not
         theretofore received payment for such work and has sufficient funds
         remaining to complete the work free of liens or claims. Any Net
         Proceeds remaining after Tenant has repaired the Leased Premises in
         conformity with the applicable requirements of Section 12 shall be
         delivered to Tenant.

                  (g)      In the event Tenant does not purchase the insurance
required by this Lease or keep the same in full force and effect, Landlord may,
but shall not be obligated, to purchase the necessary insurance and pay the
premium. Tenant shall repay to Landlord, as Additional Rent, the amount so paid
promptly upon demand. In addition, Landlord may recover from Tenant and Tenant
agrees to pay, as Additional Rent, any and all expenses (including reasonable
attorneys' fees) and damages which Landlord may sustain by reason of the failure
of Tenant to obtain and maintain such insurance.

                                       24
<PAGE>
                  (h)      Landlord or Lender shall not be limited in the proof
of any damages which Landlord or Lender may claim against Tenant arising out of
or by reason of Tenant's failure to provide and keep in force Insurance, as
provided in this Section 14, to the amount of the insurance premium or premiums
not paid or incurred by Tenant and which would have been payable under such
insurance; but Landlord and Lender shall also be entitled to recover as damages
for such breach, the uninsured amount of any loss, to the extent of any
deficiency in the insurance required by this Section 14 and damages, costs and
expenses of suit suffered or incurred by reason of or damage to, or
destruction of, the Leased Premises, occurring during any period when Tenant may
have failed or neglected to obtain the insurance required by this Section 14.
Tenant shall indemnify and hold harmless Landlord and Lender for any liability
incurred by Landlord or Lender arising out of any deductible for any insurance
required by this Section 14.

         15.      Casualty.

                  (a)      If a part of the Leased Premises shall be damaged or
destroyed by casualty, and if the estimated cost of rebuilding, replacing and
repairing the same shall exceed $75,000, Tenant shall promptly notify Landlord
thereof; and (whether or not such estimated cost shall exceed $75,000) Tenant
shall, with reasonable promptness and diligence, rebuild, replace and repair any
damage or destruction to the Leased Premises, at its expense, in conformity with
the requirements of Section 12 in such manner as to restore the same to the same
condition, as nearly as possible, as existed prior to such casualty and there
shall be no abatement of Basic Rent or Additional Rent. If the cost of any
repairs required to be made by Tenant pursuant to this Section 15(a) shall
exceed the amount of the Net Proceeds, the deficiency shall be paid by Tenant.
Any Net Proceeds remaining after such repairs have been made shall be delivered
to Tenant.

                  (b)      Notwithstanding anything in Section 14 or this
Section 15 to the contrary, during any period of time when there continues to
exist an Event of Default, Landlord, in the exercise of its sole and absolute
discretion, shall have the right to receive any insurance proceeds from any
casualty and to apply the same toward payment of any delinquent Basic Rent or
Additional Rent then due and owing to Landlord under this Lease until such Event
of Default is cured.

                  (c)      In no event may Tenant abate payment of Basic Rent
unless Landlord is receiving rental loss or other insurance payments sufficient
to offset such abatement.

                                       25
<PAGE>
         16.      Subordination to Financing.

                  (a)      Tenant agrees that this Lease shall at all times be
subject and subordinate to the lien of any Mortgage, and Tenant agrees, upon
demand, without cost, to promptly execute instruments as may be required to
further effectuate or confirm such subordination, provided such instruments
provide for the non-disturbance of Tenant's occupancy hereunder and Tenant's
attornment, and otherwise are in form and content reasonably acceptable to
Tenant. So long as Tenant shall faithfully discharge the obligations on its part
to be kept and performed under the terms of this Lease, then Tenant's tenancy
shall not be disturbed, nor shall this Lease be affected by any default under
such Mortgage, and in the event of a foreclosure or other enforcement of any
such Mortgage, or sale in lieu thereof, the purchaser at such foreclosure sale
shall be bound to Tenant for the term of this Lease and any extensions thereof,
the rights of Tenant hereunder shall expressly survive, and this Lease shall in
all respects continue in full force and effect so long as Tenant fully performs
all of its obligations hereunder. Tenant shall not be named as a party defendant
in any such foreclosure suit.

                  (b)      Notwithstanding the provisions of Section 16(a), the
holder of the Mortgage to which this Lease is subject subordinate, as provided
in said Section 16(a), shall have the right, at its sole option, at any time, to
subordinate and subject the Mortgage, in whole or in part, to this Lease by
recording a unilateral declaration to such effect.

                  (c)      At any time prior to the expiration of the Term,
Tenant agrees, at the election and upon demand of Landlord or its successors or
assigns, or of the holder of the Mortgage on the Leased Premises, to attorn,
from time to time, to any such owner or holder, upon the then executory terms
and conditions of this Lease, for the remainder of the Term originally demised
in this Lease and for any renewal Term, provided that such owner or holder as
the case may be, shall then be entitled to possession of the Leased Premises
subject to the provisions of this Lease. The provisions of this Section 16(c)
shall inure to the benefit of any such owner or holder, shall apply
notwithstanding that, as a matter of Law, this Lease may terminate upon the
foreclosure of the Mortgage, shall be self-operative upon any such demand, and
no further instrument shall be required to give effect to said provisions. Upon
demand of any such owner or holder, Tenant agrees to promptly execute, from time
to time, instruments in confirmation of the foregoing provisions of this Section
16(c), satisfactory to any such owner or holder and to Tenant acknowledging such
attornment

                                       26
<PAGE>
and setting forth the terms and conditions of its tenancy. Nothing contained in
this Section 16(c) shall be construed to impair any right otherwise exercisable
by any such owner or holder.

                  (d)      Tenant agrees that, if requested by Landlord, Tenant
shall promptly, without charge, enter into (i) a subordination, non-disturbance
and attornment agreement reasonably requested by Lender and in form and content
reasonably acceptable to Tenant and (ii) an agreement with any holder of the
Mortgage whereby Tenant shall agree for the benefit of the holder of the
Mortgage that Tenant will not, without in each case the prior written consent of
such holder, (1) amend, modify, cancel or surrender the term of this Lease
except as expressly permitted by Section 13 of this Lease, or enter into any
agreement with Landlord so to do, or (2) pay any installment of Basic Rent more
than one (1) month in advance of the due date thereof or otherwise than in the
manner provided for in this Lease.

                  (e)      Tenant agrees that it will give notice to any holder
of a first Mortgage encumbering the Leased Premises, provided that Tenant has
been notified in writing of the name and address of such Mortgage holder, of any
defaults of Landlord or other circumstances which would entitle Tenant to
terminate this Lease or abate the rental payable hereunder, specifying the
nature of the default by Landlord, and thereupon the holder of the Mortgage
shall have the right, but not the obligation, to cure any such default by
Landlord. Tenant shall afford the Mortgage holder thirty (30) days after such
notice to cure such default and a reasonable period of time in addition thereto
if circumstances are such that said default cannot be reasonably cured within
such 30-day period. No such Lender shall, upon assuming title to the Leased
Premises, be liable for any act or omission of any prior landlord (including
Landlord), be subject to any offsets or defenses which Tenant may have against
any prior landlord, or be bound by any rent or additional rent paid for more
than the then-current period plus one (1) additional month's Basic Rent to any
prior landlord. Nothing herein shall be construed to be in conflict with the
provisions of Section 7.

         17.      Assignment, Subleasing and Vacating. The Leased Premises may
be assigned or sublet by Tenant in whole or in part only with the consent of
Landlord, not to be unreasonably withheld. The bases for withholding consent
include, but is not limited to: (i) an unsatisfactory credit history and/or a
showing of unsatisfactory financial responsibility of the proposed transferee;
(ii) the business reputation of the proposed transferee is not in accordance
with generally acceptable commercial standards; (iii) the use of the Leased

                                       27
<PAGE>
Premises would be a violation of Section 4(a); (iv) the managerial and
operational skills of proposed transferee are not at least as good as those of
existing Tenant; (v) the use of the Leased Premises violates any other
agreements affecting the Leased Premises the Landlord, or other tenants; and
(vi) the transfer and/or the use of the Leased Premises would be contrary to
public policy or statute. Within thirty (30) days after Tenant gives Landlord
notice of assignment and/or sublease, said assignment shall be deemed approved
by Landlord if Landlord fails to give written notice of disapproval thereof with
specific reasons for such disapproval. Notwithstanding any assignment or
subletting, Tenant shall continue to remain liable and responsible for
the payment of the Basic Rent and Additional Rent and the performance of all its
other obligations under this Lease. Any payments of rent by such subtenant or
sublessee in excess of the Basic Rent payable hereunder shall be shared in the
ratio of 50% to Tenant and 50% to Landlord.

                  Each sublease of any of the Leased Premises shall be subject
and subordinate to the provisions of this Lease. No assignment or sublease made
as permitted by this Section 17 or otherwise shall affect or reduce any of the
obligations of Tenant hereunder, and all such obligations shall continue in full
force and effect as obligations of a principal and not as obligations of a
guarantor, as if no assignment or sublease had been made. No assignment or
sublease shall impose any obligations on Landlord under this Lease. No
assignment or sublease shall be valid unless, in the case of an assignment,
Tenant shall, within ten (10) days after the execution and delivery of any such
assignment, deliver to Landlord (a) a duplicate original of such assignment in
recordable form and (b) an agreement executed and acknowledged by the assignee
in recordable form wherein the assignee shall agree to assume and agree to
observe and perform all of the terms and provisions of this Lease on the part of
Tenant to be observed and performed, and, in the case of a sublease, Tenant
shall, within ten (10) days after the execution and delivery of such sublease,
deliver to Landlord a duplicate original of such sublease. Notwithstanding
anything to the contrary contained herein, any change in ownership or control of
Tenant shall not be deemed to be an assignment or sublet hereof.

                  Upon the occurrence of an Event of Default under this Lease,
Landlord shall have the right to collect and enjoy all rents and other sums of
money payable under any sublease of any of the Leased Premises, and Tenant
hereby irrevocably and unconditionally assigns such rents and money to Landlord,
which assignment may be exercised upon and after (but not before) the occurrence
of an Event of Default. Tenant

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<PAGE>
shall not mortgage or pledge this Lease without Landlord's express written
consent, which may not be unreasonably withheld, and any such mortgage or pledge
made in violation of this Section 17 shall be void.

         Landlord may from time to time freely assign its interest hereunder.
Upon such assignment and following written notice to Tenant thereof, Landlord
shall be discharged from any further obligation or liability hereunder;
provided, however, that Landlord shall be discharged from its obligations with
respect to the Security Deposit only upon the written acknowledgement by such
assignee to Tenant of such assignee's actual receipt of or obligation to assume
responsibility for the Security Deposit.

         18.      Permitted Contests. After prior written notice to Landlord,
Tenant shall not be required to (a) pay any Imposition, (b) comply with any
Legal Requirement, (c) discharge or remove any lien referred to in Section 9 or
Section 12, or (d) take any action with respect to any encroachment, violation,
hindrance, obstruction or impairment referred to in Section 11(b), so long as
Tenant shall contest, in good faith and at its expense, the existence, the
amount or the validity thereof, the amount of the damages caused thereby, or the
extent of its or Landlord's liability therefor, by appropriate proceedings which
shall operate during the pendency, thereof to prevent (A) the collection of, or
other realization upon, the Imposition or lien so contested, (B) the sale,
forfeiture or loss of any of the Leased Premises, any Basic Rent or any
Additional Rent to satisfy the same or to pay any damages caused by the
violation of any such Legal Requirement or by any such encroachment, violation,
hindrance, obstruction or impairment, (C) any interference with the use or
occupancy of any of the Leased Premises, (D) any interference with the payment
of any Basic Rent or any Additional Rent, (E) the cancellation of any fire or
other insurance policy, and (F) Landlord would not be in danger of civil or
criminal liability or sanctions for failure so to pay or perform. Tenant shall
provide Landlord security satisfactory in the sole opinion of Landlord assuring
the payment, compliance, discharge, removal or other action, including without
limitation all reasonable costs, attorneys' fees, interest and penalties, in the
event that the contest is unsuccessful. While any such proceedings are pending
and the required security is held by Landlord, Landlord shall not have the right
to pay, remove or cause to be discharged the Imposition or lien thereby being
contested unless any one or more of the conditions in subdivisions (A) through
(F) shall not be prevented during the pendency of the contest. Tenant further
agrees that each such contest shall be promptly and diligently prosecuted to a
final conclusion, except that Tenant shall, so long as all of the

                                       29
<PAGE>
conditions of the first sentence of this Section 18 are at all times complied
with, have the right to attempt to settle or compromise such contest through
negotiations. Tenant shall pay and save Landlord and Lender harmless for, from
and against any and all losses, judgments, decrees and costs (including without
limitation all reasonable attorneys' fees and expenses) in connection with any
such contest and shall, promptly after the final determination of such contest,
fully pay and discharge the amounts which shall be levied, assessed, charged or
imposed or be determined to be payable therein or in connection therewith,
together with all penalties, fines, interest, costs and expenses thereof or in
connection therewith, and perform all acts the performance of which shall be
ordered or decreed as a result thereof.

         19.      Conditional Limitations; Default Provisions.

                  (a)      The occurrence of any one or more of the following
shall constitute an "Event of Default" under this Lease: (i) a failure by Tenant
to make (regardless of the pendency of any bankruptcy, reorganization,
receivership, insolvency or other proceedings, in law, in equity or before any
administrative tribunal, which had or might have the effect of preventing Tenant
from complying with the provisions of this Lease) any payment of Basic Rent,
Additional Rent or other sum herein required to be paid by Tenant; (ii) a
failure by Tenant to duly perform and observe, or a violation or breach of any
other provision hereof; (iii) any representation or warranty made by Tenant
herein which proves at any time to be incorrect, in any material respect; (iv)
Tenant shall (A) voluntarily be adjudicated a bankrupt or insolvent, (B) seek or
consent to the appointment of a receiver or trustee for itself or for any of the
Leased Premises, (C) file a petition seeking relief under the bankruptcy or
other similar Laws of the United States, any state or any jurisdiction, (D) make
a general assignment for the benefit of creditors, or (E) be unable to pay its
debts as they mature; (v) a court shall enter an order, judgment or decree
appointing, with the consent of Tenant, a receiver or trustee for it or for any
of the Leased Premises or approving a petition filed against Tenant which seeks
relief under the bankruptcy or other similar Laws of the United States, any
state or any jurisdiction, and such order, judgment or decree shall remain in
force, undischarged or unstayed, sixty days after it is entered; (vi) Tenant
shall be liquidated or dissolved or shall begin proceedings towards its
liquidation or dissolution; or (vii) the estate or interest of Tenant in any of
the Leased Premises shall be levied upon or attached in any proceeding and such
estate or

                                       30
<PAGE>
interest is about to be sold or transferred or such process shall not be vacated
or discharged within sixty days after such levy or attachment.

                  (b)      If an Event of Default shall have occurred and be
continuing, Landlord shall have the right at its sole option, then or at any
time thereafter, to do any one or more of the following without demand upon or
notice to Tenant:

                           (i)      Landlord may give Tenant notice of
         Landlord's intention to terminate this Lease on a date specified in
         such notice. Upon the date therein specified, the Term and the estate
         hereby granted and all rights of Tenant hereunder shall expire and
         terminate as if such date were the date hereinbefore fixed for the
         expiration of the Term, but Tenant shall remain liable for all its
         obligations hereunder through such date, including its liability for
         Basic Rent and Additional Rent as hereinafter provided.

                           (ii)     Landlord may, whether or not the Term of
         this Lease shall have been terminated pursuant to Section 19(b)(i)
         above, (A) give Tenant notice to surrender any of the Leased Premises
         to Landlord immediately or on a date specified in such notice, at which
         time Tenant shall surrender and deliver possession of the Leased
         Premises to Landlord or (B) reenter and repossess any of the Leased
         Premises by force, summary proceedings, ejectment or any other means or
         procedure. Upon or at any time after taking possession of any of the
         Leased Premises, Landlord may remove any persons or property therefrom.
         Landlord shall be under no liability for or by reason of any such
         entry, repossession or removal. No such entry or repossession shall be
         construed as an election by Landlord to terminate this Lease unless
         Landlord gives a written notice of such intention to Tenant pursuant to
         Section 19(b)(i) above.

                           (iii)    After repossession of any of the Leased
         Premises pursuant to Section 19(b)(ii) above, whether or not this Lease
         shall have been terminated pursuant to Section 19(b)(i) above, Landlord
         shall have the right to relet the Leased Premises or any part thereof
         to such tenant or tenants for such term or terms (which may be greater
         or less than the period which would otherwise have constituted the
         balance of the Term) for such rent, on such conditions (which, if
         commercially reasonable to do so, may include concessions or free rent)
         and for such uses as Landlord, in its

                                       31
<PAGE>
         absolute discretion, may determine; and Landlord may collect and
         receive any rents payable by reason of such reletting, provided
         Landlord has made a good faith effort to mitigate its damages.

                           (iv)     Landlord may exercise any other right or
         remedy now or hereafter existing by Law or in equity.

                           (v)      To continue this Lease in effect for so long
         as Landlord does not terminate Tenant's right to possession of the
         Leased Premises and to reinforce all of Landlord's rights under this
         Lease and recover all Basic Rent, Additional Rent and other sums
         payable hereunder as the same become due.

                  (c)      No expiration or termination of this Lease pursuant
to Section 19(b)(i) or any other provision of this Lease, by operation of Law,
repossession of the Leased Premises pursuant to Section 19(b)(ii) or otherwise,
or reletting of any of the Leased Premises pursuant to Section 19(b)(iii), shall
relieve Tenant of any liabilities and obligations hereunder, including the
liability for Basic and Additional Rent, all of which shall survive such
expiration, termination, repossession or reletting.

                           In the event of any expiration or termination of this
Lease or repossession of any of the Leased Premises by reason of the occurrence
of an Event of Default, Tenant shall pay to Landlord Basic Rent, Additional Rent
and all other sums required to be paid by Tenant to and including the date of
such expiration, termination or repossession and, thereafter, Tenant shall,
until the end of what would have been the Term in the absence of such
expiration, termination or repossession, and whether or not any of the Leased
Premises shall have been relet, be liable to Landlord for and shall pay to
Landlord as liquidated and agreed current damages (but discounted at an
appropriate discount rate to its current value) (i) Basic Rent, Additional Rent
and all other sums which would be payable under this Lease by Tenant in the
absence of such expiration, termination or repossession, less (ii) the net
proceeds, if any, of any reletting pursuant to Section 19(b)(iii), after
deducting from such proceeds all of Landlord's expenses in connection with such
reletting (including all repossession costs, brokerage commissions, legal
expenses, attorneys' fees, employees' expenses, costs of Alterations and
expenses of preparation for reletting). Tenant hereby agrees to be and remain
liable for all sums aforesaid, and Landlord may recover such damages from Tenant
and institute and maintain successive actions or legal proceedings against
Tenant for the recovery of such damages. Nothing herein contained shall

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<PAGE>
be deemed to require Landlord to wait to begin such action or other legal
proceedings until the date when the Term would have expired by limitation had
there been no such Event of Default.

                  (d)      Before an Event of Default shall exist under Section
19 or any other Section hereof by reason of an Event of Default under Section
19(a), Landlord shall have given Tenant written notice of any failure by Tenant
or occurrence of any event specified in said Section 19(a) (any such failure or
occurrence being referred to in this Lease as a "Default") and Tenant shall have
failed to cure the Default within the applicable grace period stated below. If
the cure consists of payment of money or furnishing of insurance coverages
required in Section 14, the applicable grace period shall be five business days
(5) from the date on which the notice is given. If the cure consists of
something other than payment of money (except the failure to provide insurance),
the applicable grace period shall be thirty (30) days from the date on which the
notice is given, or such longer time as reasonably necessary to cure the
Default, provided that Tenant shall commence to cure the Default within said
thirty (30) day period and actively, diligently and in good faith proceed with
continued curing of the Default until it shall be fully cured.

         20.      Additional Rights of Landlord and Tenant.

                  (a)      No right or remedy herein conferred upon or reserved
to a party hereof is intended to be exclusive of any other right or remedy and
every right and remedy shall be cumulative and in addition to any other right or
remedy contained in this Lease. No delay or failure by a party hereof to enforce
its rights hereunder shall be construed as a waiver, modification or
relinquishment thereof. In addition to the other remedies provided in this
Lease, each party shall be entitled, to the extent permitted by applicable Law,
to injunctive relief in case of the violation or attempted or threatened
violation of any of the provisions of this Lease, or to specific performance of
any of the provisions of this Lease.

                  (b)      In the event of any action between the parties hereto
by reason of an alleged breach or default of this Lease, in addition to any
other rights or remedies provided by Law the prevailing party shall be entitled
to recover from the other party its costs and expenses in connection thereof,
including without limitation attorneys' fees, expenses and expert witness fees.

                  (c)      Tenant hereby waives and surrenders for itself and
all those claiming by, through or under it, including without limitation
creditors of all kinds, (i) any right or privilege which it or any of them

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<PAGE>
may have under any present or future Law to redeem the Leased Premises or to
have a continuance of this Lease for the Term hereby demised after termination
of Tenant's right of occupancy or after termination of the Term of this Lease as
herein provided, (ii) the benefits of any present or future Law which exempts
property from liability for debt or for distress for rent.

         21.      Notices. All notices, demands, requests, consents, approvals,
offers, statements and other instruments or communications or permitted to be
given pursuant to the provisions of this Lease shall be in writing and shall be
deemed to have been given for all purposes when deposited (i) with an overnight
courier service, (ii) with a personal messenger or (iii) in the United States
mail by registered or certified mail, return receipt requested, postage prepaid,
in any case addressed to the other party at its address stated below:

Tenant:                    Integrated Process Equipment Corporation
                           4717 East Hilton Avenue
                           Phoenix, Arizona 85034
                           Attention: John S. Hodgson

with a copy to:            Quarles & Brady
                           One East Camelback Road, Suite 400
                           Phoenix, Arizona 85012-1649
                           Attention: Roger K. Spencer, Esq.

Landlord:                  Seldin Properties
                           c/o Seldin Development & Management
                           13057 West Center Road
                           Omaha, Nebraska 68144-3790
                           Attention: Millard R. Seldin & Theodore M. Seldin

with a copy to:            Santin, Poli, Ball & Simms, P.L.C.
                           2999 North 44th Street
                           Phoenix, Arizona 85018
                           Attention: Peter G. Santin, Esq.

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<PAGE>
For the purposes of this Section 21, any party may substitute its address by
giving fifteen days' written notice to the other party in the manner provided
above.

         22. Estoppel Certificates. Landlord and Tenant shall, at any time and
from time to time, upon not less than fifteen (15) days' prior written request
by the other, execute, acknowledge and deliver to the other a statement in
writing, executed by a duly authorized representative of Landlord or Tenant as
the case may be certifying (a) that this Lease is unmodified and in full effect
(or, if there have been modifications, that this Lease is in full effect as
modified, setting forth such modifications), (b) the dates to which Basic Rent,
payable hereunder has been paid, (c) that to the current actual knowledge of the
signer of such certificate no Default by either Landlord or Tenant exists
hereunder or specifying each such Default of which the signer may have
knowledge; and (d) with respect to a certificate signed on behalf of Tenant,
that to the knowledge of the signer of such certificate, there are no
proceedings pending or threatened against Tenant before or by any court or
administrative agency which if adversely decided would materially and adversely
affect the financial condition and operations of Tenant or if any such
proceedings are pending or threatened to said signer's knowledge, specifying and
describing the same. It is intended that any such statements may be relied upon
by Lender, the recipient of such statements or their assignees or by any
prospective purchaser or Lender of the Leased Premises.

         23. Surrender and Holding Over. Upon the expiration or earlier
termination of this Lease, Tenant shall peaceably leave and surrender the Leased
Premises (except as to any portion thereof with respect to which this Lease has
previously terminated) to Landlord in the same condition in which the Leased
Premises were originally received from Landlord at the commencement of this
Lease, except as to any repair or Alteration as permitted or required by any
provision of this Lease, and except for ordinary wear and tear. Tenant shall
remove from the Leased Premises on or prior to such expiration or earlier
termination Tenant's Trade Fixtures and other personal property which are owned
by Tenant or third parties other than Landlord, and Tenant at its expense shall,
on or prior to such expiration or earlier Termination, repair any damage caused
by such removal. Tenant's Trade Fixtures and other personal property not removed
within fifteen (15) days following the end of the Term or within thirty (30)
days after the earlier termination of the Term for any reason whatsoever shall
become the property of Landlord, and Landlord may thereafter cause such property

                                       35
<PAGE>
to be removed from the Leased Premises. The cost of removing and disposing of
such property and repairing any damage to any of the Leased Premises caused by
such removal shall be borne by Tenant. Landlord shall not in any manner or to
any extent be obligated to reimburse Tenant for any property which becomes the
property of Landlord as a result of such expiration or earlier termination.
Tenant shall not commit waste of the Leased Premises.

                  Any holding over by Tenant of the Leased Premises following
the expiration or earlier termination of the Term of this Lease or any
extensions thereof, with the consent of Landlord, shall operate and be construed
as tenancy from month to month only, at one hundred and fifty percent (150.0%)
of the Basic Rent reserved herein and otherwise upon the same terms and
conditions as contained in this Lease. Notwithstanding the foregoing, any
holding over shall entitle Landlord, in addition to collecting such increased
Basic Rent, to all rights and remedies provided by Law or in equity, including
the remedies of Section 19(b).

         24. Risk of Loss. The risk of loss or enjoyment and beneficial use of
any of the Leased Premises in consequence of the damage or destruction thereof
by fire, the elements, casualties, thefts, riots, wars or otherwise, or in
consequence of foreclosure, attachments, levies or executions (other than by
Landlord and those claiming from, through or under Landlord) is assumed by
Tenant, and Landlord shall in no event be answerable or accountable therefor.
Except as otherwise specifically provided in Section 13 of this Lease, none of
the events mentioned in this Section 24 shall entitle Tenant to any abatement of
Basic Rent or Additional Rent or otherwise affect any of the obligations of
Tenant hereunder.

         25. No Merger of Title. There shall be no merger of this Lease nor of
the leasehold estate created by this Lease with the fee estate in or ownership
of any of the Leased Premises by reason of the fact that the same person,
corporation, firm or other entity may acquire or hold or own, directly or
indirectly, (a) this Lease or the leasehold estate created by this Lease or any
interest in this Lease or in such leasehold estate and (b) the fee estate or
ownership of any of the Leased Premises or any interest in such fee ownership.
No such merger shall occur unless and until all persons, corporations, firms and
other entities having any interest in (a) this Lease or the leasehold estate
created by this Lease and (b) the fee estate in or ownership of the Leased
Premises or any part thereof sought to be merged shall join in a written
instrument effecting such merger and shall duly record the same.

                                       36
<PAGE>
         26. Landlord's Liability. Anything contained herein to the contrary
notwithstanding, any claim based on or in respect of any liability of Landlord
under this Lease shall be enforced only against the Leased Premises and not
against any other assets, properties or funds of Landlord or any director,
officer, general partner, limited partner, employee or agent of Landlord or any
legal representative, heir, estate, successor or assign of any thereof.

                  The term "Landlord" as used in this Lease so far as covenants
or obligations on the part of Landlord are concerned shall be limited to mean
and include only the owner or owners of the Leased Premises or holder of the
Mortgage in possession at the time in question of the Leased Premises and in the
event of any transfer or transfers of the title of the Leased Premises, Landlord
herein named (and in case of any subsequent transfers or conveyances, the then
grantor) shall be automatically freed and relieved from and after the date of
such transfer and conveyance of all personal liability as resets the performance
of any covenants or obligations on the part of Landlord contained in this Lease
thereafter to be performed.

         27. Hazardous Substances. Tenant represents and warrants that it will
not on or about the Leased Premises, make, treat, generate, store or dispose of
any Hazardous Substances except in strict compliance with all Environmental
Laws, and Tenant represents and warrants that it will at all times strictly
comply with all Environmental Laws. To the extent required by applicable
Environmental Laws, at the termination of its tenancy hereunder Tenant shall
remove any Hazardous Substances whether now or hereafter existing on the Leased
Premises and whether or not arising out of or in any manner connected with
Tenant's occupancy of the Leased Premises during the initial Term or any
additional Term hereof. Tenant shall and hereby does agree to defend, indemnify
and hold Landlord, its officers, directors, shareholders and employees harmless
for, from and against any and all loss, damage, expenses, fees, claims, costs,
and liabilities, including, but not limited to, attorneys' fees and costs of
litigation, arising out of or in any manner connected with the "release" or
"threatened release" of or failure to remove, as required by this Section 27,
Hazardous Substances from the Leased Premises or any portion or portions
thereof, now or hereafter existing and whether or not arising out of or in any
manner connected with Tenant's occupancy of the Leased Premises during the
initial Term or any additional Term, except as such Hazardous Substances were
introduced by or caused to be introduced by

                                       37
<PAGE>
Landlord, Lender or their respective officers, directors, employees or others in
privity of contract in connection with the Leased Premises or this Lease.

         At the end of the Term, Tenant shall furnish to Landlord an
environmental report from an environmental consultant acceptable to Landlord in
its reasonable discretion evidencing that the Leased Premises are not in
violation of Environmental Laws. Such report shall be at Landlord's expense,
unless Tenant shall have previously violated Environmental Laws or such report
discloses a violation thereof. In addition, from time to time during the Term
Landlord may conduct such investigations or studies with respect to the Leased
Premises and Environmental Laws as it may reasonably desire to ascertain
compliance with Environmental Laws; the cost of any such report shall be at
Landlord's expense unless such report discloses a violation of Environmental
Laws.

         Tenant shall notify Landlord and Lender in writing of any Hazardous
Substance that exists on or is discharged from or onto the Leased Premises
(whether originating thereon or migrating to the Leased Premises from other
property) in violation of any Environmental Law within ten (10) days after
Tenant first has knowledge of such violation. In addition, on the Commencement
Date, and annually thereafter, Tenant shall provide a written list of any
Hazardous Substance that exists on or is discharged from or onto the Leased
Premises together with relevant Material Data Safety Sheets to the extent in
Tenant's possession.

         Tenant's obligations and liabilities under this Section shall survive
the expiration of this Lease.

         28. Entry by Landlord. Landlord and its authorized representatives
shall have the right to enter the Leased Premises at all reasonable times (a)
for the purpose of inspecting the same or for the purpose of doing any work
under Section 32, and may take all such action thereon as may be necessary or
appropriate for any such purpose (but nothing contained in this Lease or
otherwise shall create or imply any duty upon the part of Landlord to make any
such inspection or do any such work), and (b) for the purpose of showing the
Leased Premises to prospective purchasers and mortgagees and, at any time within
12 months prior to the expiration of the term of this Lease for the purpose of
showing the same to prospective tenants. No such entry shall constitute an
eviction of Tenant.

                                       38
<PAGE>
         29.      Financial Statements. Tenant shall furnish to Landlord
Tenant's most recent publicly filed annual and quarterly reports within twenty
(20) days of filing thereof with the United States Securities and Exchange
Commission.

         30. Broker. Landlord and Tenant represent and warrant to each other
that neither party negotiated with any broker in connection with this Lease and
that this Lease was negotiated directly by Landlord and Tenant. Each party
covenants to indemnify and hold harmless the other party for any loss caused by
the breach of the foregoing representation and warranty.

         31.      Additional Provisions Regarding Use.

                  (a)      Tenant shall continuously use and occupy the Leased
Premises during the first five (5) years of the Term.

                  (b) Tenant shall be solely responsible for security at, in and
on the Leased Premises and Landlord shall have no responsibility or liability
for any loss or damage therefor unless the same is caused by the gross
negligence or wilful misconduct of Landlord or its officers, directors,
employees or others in privity of contract in connection with the Leased
Premises or this Lease.

                  (c) Landlord shall not be liable to Tenant by reason of any
interruption of utilities or other services provided to the Leased Premises
unless such interruption is caused by the gross negligence or wilful misconduct
of Landlord or its officers, directors, employees or others in privity of
contract in connection with the Leased Premises or this Lease.

         32. Landlord's Right to Take Action. Subject to Tenant's right to
receive notice of such violation or default and opportunity to cure as expressly
provided in this Lease, if Tenant shall have violated or be in default under any
provision of this Lease, Landlord may do whatever is necessary to cure such
violation or default for the account of and/or in the name of, and at the
expense of, Tenant. All sums so paid by Landlord and all costs and expenses
(including, without limitation, reasonable attorneys' fees and expenses) so
incurred, together with interest thereon at the Default Rate from the date of
payment or incurring the expense, shall constitute Additional Rent payable by
Tenant under this Lease and shall be paid by Tenant to Landlord on demand.

                                       39
<PAGE>
         33.      Miscellaneous.

                  (a) The Section headings in this Lease are used only for
convenience in finding the subject matters and are not part of this Lease or to
be used in determining the intent of the parties or otherwise interpreting this
Lease.

                  (b) References to a "Section" or "section" when used without
further attribution refer to the particular section of this Lease.

                  (c) For the purpose of any Law that construes the
interpretation of this Lease against the drafter thereof, neither party hereto
shall be deemed to be the "drafter" of this Lease. In addition, the following
words and phrases shall have the following meanings: (i) "including" shall mean
"including but not limited to"; (ii) "provisions" shall mean "provisions, terms,
agreements, covenants and/or conditions"; (iii) "lien" shall mean "lien, charge,
encumbrance, title retention agreement, pledge, security interest, mortgage
and/or deed of trust"; (iv) "obligation" shall mean "obligation, duty,
agreement, liability, covenant or condition"; (v) "any of the Leased Premises"
shall mean "the Leased Premises or any part thereof or interest therein"; and
(6) "any of the Improvements" shall mean "the Improvements or any part thereof
or interest therein".

                  (d) Except as otherwise expressly set forth in this Lease,
this Lease is solely for the benefit of Landlord and Tenant,; there are no other
intended third party beneficiaries hereof.

                  (e) This Lease may be modified, amended, discharged or waived
only by an agreement in writing specifically referring to this Lease and signed
by the party against whom enforcement of any such modification, amendment,
discharge or waiver is sought.

                  (f) The covenants of this Lease shall run with the Land and
bind Tenant and Landlord as applicable and their respective successors and
assigns and all present and subsequent encumbrances and subtenants of any of the
Leased Premises, and shall inure to the benefit of and bind Landlord and Tenant
as applicable and their respective successors and assigns.

                  (g) In the event any one or more of the provisions contained
in this Lease shall for any reason be held to be invalid, illegal or
unenforceable in any respect, such invalidity, illegality or unenforceability
shall not affect any other provision of this Lease but this Lease shall be
construed as if such invalid, illegal or unenforceable provision had never been
contained herein.

                                       40
<PAGE>
                  (h) This Lease will be simultaneously executed in
counterparts, each of which when so executed and delivered shall constitute an
original, fully enforceable counterpart for all purposes.

                  (i)      This Lease shall be governed by and construed
according to the Laws of the State of Arizona.

                  (j)      Time shall be of the essence of this Agreement and
each and every term and condition hereof.

                  (k) The exhibits and schedules attached to this Agreement
and/or described in this Lease are incorporated herein and shall be considered a
part of this Lease for the purposes stated herein.

                  (l) A memorandum of this Lease, in form and content
substantially similar to Exhibit "D", shall be recorded in the office of the
Maricopa County, Arizona Recorder's Office immediately upon the execution and
delivery of this Lease.

                            [SIGNATURE PAGE FOLLOWS]

                                       41
<PAGE>
         IN WITNESS WHEREOF, Landlord and Tenant have caused this instrument to
be executed as of the day and year first above written.

LANDLORD:                      TENANT:

SELDIN PROPERTIES              INTEGRATED PROCESS EQUIPMENT CORPORATION

By: /s/ Millard R. Seldin      By: /s/ John S.Hodgson
-------------------------      ----------------------------------------------
Name: Millard R. Seldin        Name: John S. Hodgson
Title: General Partner         Title: Vice President and chief Financial Officer

<PAGE>
                              EXHIBIT "A" TO LEASE

                      Legal Description of Leased Premises

The Leased Premises are located in Maricopa County, Arizona, and is legally
described as follows:

Parcel No. 1:

Lots 6, 7 and 8, RIO SALADO GATEWAY CENTER, according to Book 267 of Maps, page
34, records of Maricopa County, Arizona.

Parcel No. 2:

That portion of Lot 9, RIO SALADO GATEWAY CENTER, according to Book 267 of Maps,
page 34, records of Maricopa County, Arizona, described as follows:

         BEGINNING at the Northeast corner of said Lot 9;

         thence South 00(degree) 14' 14" West along the East line of said Lot 9
         a distance of 447.45 feet to the South line of said RIO SALADO GATEWAY
         CENTER;

         thence North 89(degree) 45' 46" West (basis of bearings) along said
         South line 55.66 feet to the East right-of-way line of the proposed
         47th Street roadway;

         thence North 00(degree) 14' 19" East along the said East right-of-way
         line 427.44 feet;

         thence North 45(degree) 14' 16" East"28.28 feet to the South
         right-of-way line of Hilton Avenue as depicted on said RIO SALADO
         GATEWAY CENTER;

         thence South 89(degree) 45' 46" East along said South right-of-way line
         35.65 feet to the Northeast corner of said Lot 9 and the POINT OF
         BEGINNING.
<PAGE>
                              EXHIBIT "B" TO LEASE

                             Permitted Encumbrances

         1.       Reservations contained in the patent from the United States of
America, reading as follows:

                           SUBJECT to any vested and accrued water rights for
                  mining, agricultural, manufacturing, or other purposes, and
                  rights to ditches and reservoirs used in connection with such
                  water rights as may be recognized and acknowledged by the
                  local customs, laws and decisions of courts, and also subject
                  to the right of the proprietor of a vein or lode to extract
                  and remove his ore therefrom, should the same be found to
                  penetrated or intersect the premises hereby granted, as
                  provided by law; and any other reservation as set forth in the
                  statutes under which said patent was issued.

         2. The rights of the United States of America, the State of Arizona
and/or the public to any portion of the Land lying within the bed, or former
bed, of any water course, as that term is defined under the Law of the State of
Arizona.

         3. Restrictions, conditions and regulations governing use of
groundwater by reason of the inclusion of said land within Phoenix Active
Management Area, pursuant to Arizona Revised Statutes Section 45-101 et seq.

         4.       Water rights, claims or title to water, and agreements,
covenants, conditions or rights incident thereto, whether or not shown by the
public records.

         5.       Taxes and assessments collectible by the Maricopa County
Treasurer constituting a lien payable but not yet due.

         6. Easement and rights incident thereto, as set forth in those certain
Right of Way Easements each dated December 21, 1962, recorded with the Maricopa
County Recorder in Docket 4432, Page 454 and Docket 4437, Page 427,
respectively.

         7.       Easements, restrictions, reservations and conditions as shown
on the plat recorded in Book 267 of Maps, Page 34.

         8. Restrictions, conditions, covenants, reservations, including but not
limited to any recitals creating easements, liabilities, obligations or party
walls, omitting, if any, from the above, any restrictions based on race, color,
religion or national origin contained in that certain Declaration of
Restrictions for Rio Salado Gateway Center dated May 16, 1984, recorded with the
Maricopa County Recorder as Document Number 84-217129, and that certain First
Amendment to Declaration of Restrictions for Rio Salado Gateway Center dated May
16, 1984, recorded with the Maricopa County Recorder as Document Number
84-311463.

         9.       Easements as shown on the plat recorded in Book 305 of Maps,
Page 28.

         10. Easement and rights incident thereto, as set forth in that certain
Underground Power Easement dated June 9, 1995, recorded with the Maricopa County
Recorder as Document Number 95-0352382.

         11.      This Lease.
<PAGE>
                              EXHIBIT "C" TO LEASE

                                  Rent Schedule

         The Basic Rent for the first Lease year, being the period of December
26, 1996 through December 31, 1997, shall be in the annual amount of $2,057,000,
payable in monthly installments each in the amount of $171,416.67. The Basic
Rent for each subsequent period of January 1 through December 31 shall be in an
annual amount increasing by (a) the amount of 2.5% plus any make-up adjustment
as set forth below, or (b) in the event that the percentage increase in the CPI
for the preceding Lease year is less than one percent (1.0%), the amount of
$20,570.00 (1.0%).

         The make-up adjustment for any given year shall be averaged on a
sum-of-the-years basis throughout the term of this Lease, but shall not exceed a
cumulative average increase of $51,425. For example, assuming the following CPI
increases:

                  End of first Lease year, 0.50%; End of second Lease year,
                  4.0%; and End of third Lease year, 4.0%;

then the increase for each Lease year would be as follows:

                  Basic Rent for the second Lease year would increase by 1.0%;
                  Basic Rent for the third Lease year would increase by 4.0%;
                  and Basic Rent for the fourth Lease year would increase by
                  2.50%.

         Notwithstanding anything to the foregoing, all increases shall be based
upon the Basic Rent for the first Lease year; accordingly, increases in the
Basic Rent shall not be compounded.

         Basic Rent for the first year of any period of extension or renewal of
the Term shall be the market rate of rent at the time of each respective renewal
or extension; provided, however, that such Basic Rent shall in no event be any
less than the Basic Rent in effect for the Lease year immediately preceding such
extension or renewal period. Basic Rent for each subsequent year of any period
of extension or renewal shall increase pursuant to the formula set forth above
and otherwise applicable during the initial Term hereof.
<PAGE>
         The schedule of Basic Rent, on an annual basis, assuming the maximum
increase each year and no extension or renewal of the initial Term, is as
follows:

<TABLE>
<CAPTION>

Lease Year            Annual Basic Rent
<S>          <C>      <C>                 <C>
 1                      $  2,057,000      Dec 26, 1996 - Dec 30, 1997
 2                      $  2,108,425      Jan 1, 1998 - Dec 30, 1998
 3                      $  2,159,850      Jan 1, 1999 - Dec 30, 1999
 4                      $  2,211,275      Jan 1, 2000 - Dec 30, 2000
 5           15.04      $  2,262,700      Jan 1, 2001 - Dec 30, 2001
 6           15.38      $  2,314,125      Jan 1, 2002 - Dec 30, 2002
 7           16.06      $  2,365,550      Jan 1, 2003 - Dec 30, 2003
 8                      $  2,416,975      Jan 1, 2004 - Dec 30, 2004
 9                      $  2,468,400      Jan 1, 2005 - Dec 30, 2005
10                      $  2,519,825
11                      $  2,571,250
12                      $  2,622,675
13                      $  2,674,100
14                      $  2,725,525
15                      $  2,776,950
</TABLE>

                                 150,420 sq. ft.

                                       C-2
<PAGE>
                              EXHIBIT "D" TO LEASE

                           Form of Memorandum of Lease

After recording, return to:
Peter G. Santin, Esq.
Santin, Poli, Ball & Simms, P.L.C.
2999 North 44th Street
Phoenix, Arizona 85018

                          MEMORANDUM OF LEASE AGREEMENT

 STATE OF ARIZONA    Section
                     Section
 COUNTY OF MARICOPA  Section

         THIS MEMORANDUM OF LEASE is made as of December 26,1996, between SELDIN
PROPERTIES, a Nebraska partnership ("Landlord"), whose address is 13057 West
Center Road, Omaha, Nebraska 68144-3790, Attn: Millard R. Seldin, and INTEGRATED
PROCESS EQUIPMENT CORPORATION ("Tenant"), having an address of 4717 East Hilton
Avenue, Phoenix, Arizona 85034, Attn: John S. Hodgson.

                                   WITNESSETH:

         (1) Landlord as of this day hereby leases unto Tenant the land and
improvements situated on that certain tract of land legally described on Exhibit
"A" attached hereto (the "Premises") pursuant to the terms of that certain Lease
of even date hereto (the "Lease"). The terms and conditions of the Lease are
incorporated herein by reference.

         (2)      The Lease sets forth the above names and addresses of the
parties thereto.

         (3)      The term of the Lease commences on the date hereof and expires
at midnight on December 31, 2011.

         (4) Tenant has a right to extend the term of the Lease for two (2)
successive periods of five (5) years each. The maximum date to which the Lease
may be extended is December 31, 2021. Tenant's rights of extension are
exercisable as set forth in the Lease. Failure to exercise any of the foregoing
rights to extend the term of the Lease shall render null and void the subsequent
right or rights to extend the term.

         (5) Notice is hereby given that Landlord shall not be liable for any
labor, services or materials furnished or to be furnished to Tenant, or to
anyone holding any of the Premises through or under Tenant, and that no
mechanic's liens for such labor, services or materials shall attach to or affect
the interest of Landlord in and to any of the Premises.

                            [SIGNATURE PAGE FOLLOWS]
<PAGE>
         IN WITNESS WHEREOF, the parties have caused this Memorandum of Lease to
be executed by their duly authorized representatives the day and year first
above written.

                               INTEGRATED PROCESS EQUIPMENT CORPORATION

                               By:______________________________________________
                              Name: John S. Hodgson

                               Title: Vice President and Chief Financial Officer

                                SELDIN PROPERTIES

                               By:______________________________________________
                               Name: Millard R. Seldin
                               Title: General Partner

STATE OF ARIZONA    Section
                    Section
COUNTY OF Maricopa  Section

         The foregoing instrument was acknowledged before me this ___ day of
December, 1996, by John S. Hodgson, Vice President and Chief Financial Officer
of INTEGRATED PROCESS EQUIPMENT CORPORATION, a Delaware corporation, on behalf
of said corporation.

                               -----------------------------------------------
                               Notary Public in and for

                              The State of Arizona

STATE OF___________ Section
                    Section

COUNTY OF__________ Section

         The foregoing instrument was acknowledged before me this __ day of
December, 1996, by Millard R. Seldin, general partner of SELDIN PROPERTIES, a
Nebraska partnership, on behalf of said general partnership.

                               -----------------------------------------------
                               Notary Public in and for The State of _________

                                       D-2
<PAGE>
STATE OF ARIZONA    Section
                    Section
COUNTY OF Maricopa  Section

         The foregoing instrument was acknowledged before me this __ day of
December, 1996, by John S. Hodgson, Vice President and Chief Financial Officer
of INTEGRATED PROCESS EQUIPMENT CORPORATION, a Delaware corporation, on behalf
of said corporation.

                               -----------------------------------------------
                               Notary Public in and for

                              The State of Arizona

STATE OF___________ Section
                    Section

COUNTY OF__________ Section

         The foregoing instrument was acknowledged before me this __ day of
December, 1996, by Millard R. Seldin, general partner of SELDIN PROPERTIES, a
Nebraska general partnership, on behalf of said general partnership.

                               -----------------------------------------------
                               Notary Public in and for The State of _________

                                       D-3
<PAGE>
STATE OF __________ Section
                    Section

COUNTY OF _________ Section

         The foregoing instrument was acknowledged before me this __ day of
December, 1996, by Theodore M. Seldin, general partner of SELDIN PROPERTIES, a
Nebraska general partnership, on behalf of said general partnership.

                               -----------------------------------------------
                               Notary Public in and for The State of _________

STATE OF___________ Section
                    Section

COUNTY OF__________ Section

         The foregoing instrument was acknowledged before me this __ day of
December, 1996, by Stanley C. Seldin, the general partner of SELDIN PROPERTIES,
a Nebraska general partnership, on behalf of said general partnership.

                               -----------------------------------------------
                               Notary Public in and for The State of _________

                                       D-4
<PAGE>
                              EXHIBIT "E" TO LEASE

                           Purchase Offer Computation

         The "Purchase Price" means the fair market value of the Leased Premises
(excluding Trade Fixtures) as of the date of receipt of notice of the Taking, as
established by an independent appraisal prepared by an MAI-certified commercial
appraiser agreed upon by Landlord and Tenant. If no such agreement can be made,
each party shall select an MAI-certified commercial appraiser, and such
appraisers shall select a third MAI-certified commercial appraiser who shall
conduct such independent appraisal. In any event, Landlord and Tenant shall each
pay one-half of the cost of such appraisal.
<PAGE>
                                  SCHEDULE "I"

                           Schedule of Air Compressors

1.    75 h.p. Sollaire Serial Number 003-74391

2.    I.R. Air Dryer Serial Number 72P5766

3.    100 h.p. Sollaire Serial Number _______

4.    Sollaire Air Dryer Serial Number 003-01105

5.    Kaeser-SK19 Air Compressor and Dryer Serial Number 3333-1-9105-27K

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