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                                                                EXHIBIT 10.17

                           OAK RIDGE TECHNICAL CENTER

LEASE AGREEMENT

This lease ("Lease"), dated, for reference purposes only December 15, 2004 is
made by and between Oak Ridge Technical Center Partners-One, LP, ("Landlord")
whose address for purposes hereof is c/o Cowperwood Company, 245 Commerce Green
Blvd., Suite 140, Sugar Land, TX 77478, and IPIX Corporation, ("Tenant").
Tenant's address for purposes hereof until commencement of the term of this
Lease is 1009 Commerce Park Drive, Suite 400, Oak Ridge, Tennessee 37830
and thereafter shall be Suite No. 100 in the Building (hereinafter defined)
located at 1055 Commerce Park Drive, Oak Ridge, Tennessee 37830. This Lease is
subject to the terms, covenants and conditions herein set forth and Tenant
covenants as a material part of the consideration for this Lease to keep and
perform each and all of said terms, covenants and conditions by it to be kept
and performed and that this Lease is made upon the condition of said
performance.

1. INTRODUCTORY PROVISIONS. The Lease provisions and definitions set forth in
this Section 1. in summary form are solely to facilitate convenient reference by
the parties. If there is any conflict between this Section and other provisions
of this Lease, the latter shall control.

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    <S>                                     <C>
    1.a. LANDLORD'S NAME AND ADDRESS:       Oak Ridge Technical Center Partners-One, L.P.
                                            c/o Cowperwood Company
                                            245 Commerce Green Blvd.
                                            Suite 140
                                            Sugar Land, Texas 77478

    1.b. TENANT'S NAME AND ADDRESS
         UPON LEASE COMMENCEMENT:           IPIX Corporation
                                            -----------------------------------
                                            1009 Commerce Park Drive
                                            -----------------------------------
                                            Suite 400
                                            -----------------------------------
                                            Oak Ridge, TN 37830
                                            -----------------------------------

    1.c. BUILDING:                          Oak Ridge Technical Center Partners One, LP.
                                            1055 Commerce Park Drive
                                            Oak Ridge, TN 37830
                                            Containing approximately 35,1001 sq. ft. of NRA

    1.d. PREMISES:                          19,7652 square feet of NRA designated as Suite 100.

    1.e. PARKING:                           # of Surface Parking Spaces: 4.5/1000

    1.f. PERMITTED USE:                     Office Area and ancillary uses, including
                                            labs and light assembly

    1.g. PRIMARY TERM:                      Five (5) Years
                                            --------------

    1.h. TENANT'S PRO RATA SHARE:           56.3106%
                                            --------

    1.i. BASE ANNUAL RENTAL RATE:           Year 1 = $15.82 per net rentable sq. ft.
                                            -----------------------------------------
                                            Year 2 = $16.07 per net rentable sq. ft.
                                            -----------------------------------------
                                            Year 3 = $16.32 per net rentable sq. ft.
                                            -----------------------------------------
                                            Year 4 = $16.57 per net rentable sq. ft.
                                            ----------------------------------------
                                            Year 5 = $16.82 per net rentable sq. ft.
                                            -----------------------------------------
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   <S>                                     <C>
   1.j. BASE YEAR OPERATING EXPENSE:       Expense Stop of $6.27/ sq. ft.
                                           ------------------------------
                                           of NRA included in the Base Annual
                                           -----------------------------------
                                           Rental Rate
                                           -----------

   1.k. SECURITY DEPOSIT:                  NONE
                                           ----

   1.l. RENTAL CONCESSIONS:                2.5 months rental abatement totaling $65,142.15
                                           -----------------------------------------------

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2. PREMISES. Landlord does hereby lease to Tenant and Tenant hereby leases from
Landlord certain premises ("Premises") in the building known as Oak Ridge
Technical Center One ("Building"). The Building is situated on real property
located in Anderson County, Tennessee, which real property is more particularly
described in the attached Exhibit D. The Premises are shown on the attached
Exhibit B, which exhibit also depicts the Premises in relation to the Building's
floor plan for the floor occupied by Tenant. The net rentable area for the
Premises has been established using the current Building Owners and Managers
Association International ANSI Z 65.1 method of measurement, Copyright 1990
("BOMA Method") and is stipulated by the parties to be 19,765 net rentable
square feet of office space as of the Commencement Date (hereinafter defined).

3. TERM, RENEWAL, TERMINATION.

         3.a. The term ("Term") of this Lease shall be five (5) years,
commencing on the "Commencement Date," which shall be the earlier of (a) the
date on which Tenant begins to actually occupy all or any portion of the
Premises for the Permitted Use or (b) the date a certificate of occupancy issues
with respect to the tenant improvements described in Addendum A. If the
Commencement Date has not occurred by June 1, 2005, through no fault of Tenant,
Tenant shall have the right to terminate the Lease upon written notice to
Landlord, in which event the Lease shall be null and void and neither party
shall have further liability to the other, such right to terminate being
Tenant's sole remedy in those circumstances.

         3.b. PRE-COMMENCEMENT ACCESS. Tenant shall be permitted to enter the
Premises at least three weeks prior to the Commencement Date, without any
obligation to pay rent, for the purpose of installing furniture, communications
system, fixtures, and special leasehold improvements. Such installation shall be
coordinated with Landlord's Construction Manager.

         3.c. Landlord and Tenant will, at the request of either, execute a
declaration specifying the Commencement Date. Rental under this Lease shall not
commence until the Commencement Date.

         3.d. OPTION TO RENEW. Landlord hereby grants Tenant the option to renew
the Lease for three (3) additional three (3) year terms, with the Annual Base
Rental Rate for the Renewal Term (Renewal Rate) to be 95% of the fair market
rental rate, which shall be based on the then comparable rates for comparable
office space located in Commerce Park, Oak Ridge, Tennessee. In no event will
the Renewal Rate during the first three year Renewal Term be less than $16.00
per net rentable square foot. In no event will the Renewal Rate during the
second and third Renewal Term(s) be less than the Base Annual Rental Rate per
net rentable square foot for the year immediately preceding the commencement of
the Renewal Term (the "Prior Year Rental Rate"). Tenant shall receive a new
Operating Expense Stop (Renewal Term Operating Expense Stop) at the commencement
of the Renewal Term. The Renewal Term Operating Expense Stop shall be equal to
actual operating expenses paid by Landlord (i.e., grossed up to 95% occupancy)
for the calendar year immediately preceding the commencement of the Renewal
Term. To accept this option, Tenant shall notify Landlord in writing not less
than six (6) months prior to the expiration date of the initial lease term (or
the then current Renewal Term), and Landlord shall notify Tenant of the fair
market rate for such Renewal Term, and provide substantiation therefor. In the
event Landlord and Tenant are not able to agree on the fair market rate within
thirty (30) days, such fair market rate shall be determined by arbitration
conducted by the American Arbitration Association pursuant to its Commercial
Arbitration Rules and shall be conducted on an expedited basis pursuant to its
Expedited Basis Rules. The arbitration shall be binding on the parties,
provided, however, that if the award is a Renewal Rate which is less than the
Prior Year Rental Rate, the

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Renewal Rate shall be equal to the Prior Year Rental Rate. The Renewal Rate
during the arbitration shall be the Prior Year Rental Rate. If the award is for
a Renewal Rate which is greater than the Prior Year Rental Rate, Tenant shall
pay the difference in rent which accrued during the arbitration period to
Landlord within 30 days of the award and shall commence paying at the awarded
Renewal Rate on the first of the month next following the award.

         3.e. OPTION TO TERMINATE. Landlord hereby grants Tenant a ONE-TIME
right to terminate this Lease at the end of the third (3rd) year of the Lease
Term. To exercise this right, Tenant shall provide Landlord with not less than
six (6) months prior written notice of its intent to exercise such right and
shall pay to Landlord all unamortized Tenant Improvement Costs and brokerage
fees. Landlord shall provide a final cost statement upon completion of Tenant
Improvements. Such cost statement shall set forth the sum of the actual final
cost of the project, plus Landlord's markup for overhead and profit, plus
brokerage fees, which sum shall be amortized over the five-year lease term at
6.5% annual interest rate.

4. POSSESSION.

         4.a. If the Commencement Date has not occurred by June 1, 2005 and such
failure was solely the result of acts or omissions of Tenant or its agents,
Tenant's obligations under this Lease shall commence on the date a certificate
of occupancy could have been issued with respect to the improvements described
in Addendum A, but for Tenant's sole delay.

         4.b. Tenant shall have fifteen (15) days following the Commencement
Date to notify Landlord in writing setting forth specifically any construction
work which Landlord had agreed in writing to cause to be performed within the
Premises and which has been omitted or is deficient through no fault or request
of Tenant or its agents. Upon receipt of such written notice, Landlord shall
cause such specified omitted work to be completed within thirty (30) days.
Occupation of all or any portion of the Premises by Tenant shall be conclusive
evidence that the Premises are in satisfactory condition and acceptable to
Tenant, subject to latent defects and the omissions and deficiencies so listed
in writing as specified above.

5. ANNUAL BASE RENTAL. During the Term, Tenant shall pay a base annual rental
("Annual Base Rent") amount scheduled as follows:

              YEAR 1: $15.82 per net rentable square foot, Annual Rent of Three
              hundred and twelve thousand six hundred and eighty-two. and 30/00
              Dollars, payable by Tenant in equal monthly installments of
              Twenty-six thousand and fifty-six and 86/00 Dollars ($26,056.86)
              (Monthly Base Rent) commencing upon the Commencement Date, but
              such total amount and commencement of payment subject to the
              provisions of 5.a. below detailing the rental concession granted
              hereunder.

              YEAR 2: $16.07 per net rentable square foot, Annual Base Rent of
              Three hundred seventeen thousand six hundred twenty three and
              55/00 Dollars ($317,623.55), payable by Tenant in equal monthly
              installments of Twenty-six thousand four hundred sixty-eight and
              63/00 Dollars ($26,468.63) (Monthly Base Rent).

              YEAR 3: $16.32 per net rentable square foot, Annual Base Rent of
              Three hundred twenty-two thousand five hundred sixty-four and
              80/00 Dollars ($322,564.80), payable by Tenant in equal monthly
              installments of Twenty-six thousand eight hundred eighty and 40/00
              Dollars ($26,880.40) (Monthly Base Rent).

              YEAR 4: $16.57 per net rentable square foot, Annual Base Rent of
              Three hundred twenty-seven thousand five hundred six and 86/00
              Dollars ($327,506.05), payable by Tenant in equal monthly
              installments of Twenty-seven thousand two hundred ninety-two and
              17/00 Dollars ($27,292.17) (Monthly Base Rent).

              YEAR 5: $16.82 per net rentable square foot, Annual Base Rent of
              Three hundred thirty-two thousand four hundred forty-seven and
              30/00 Dollars ($332,447.30), payable by Tenant in equal monthly
              installments of Twenty-seven thousand seven hundred three and
              94/00 Dollars ($27,703.94) (Monthly Base Rent).

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Each installment payment of Annual Base Rent shall be paid in advance and
without demand by a check delivered by the first business day of each month to
Landlord at the address set out in Article 1, above, or such other address as
may be designated by Landlord in writing from time to time.

Landlord will invoice Tenant for each installment of Annual Base Rent prior to
the first of each month, but the installment of Annual Base Rent is at all times
due and payable without demand or invoice. Installment payments of Annual Base
Rent are considered late after the 10th of each month. All past due installments
of Annual Base Rent shall bear interest at the maximum lawful rate per annum
permitted by the State of Tennessee (not to exceed the prime rate plus 3%) from
the due date until paid. Rent for any partial month shall be prorated and paid
in advance.

         5.a. RENTAL CONCESSION. Landlord herby grants Tenant a "rental
concession" in the form of 2.5 months of rental abatement, which rental
concession equates to $65,142.15 (19,765 RSF x $15.82/RSF /12 x 2.5 months).
Landlord has agreed to permit Tenant to extend occupancy in their current lease
space in the Oak Ridge Technical Center Four Building (ORTC4 Building) paying NO
rent beyond their current lease expiration date of January 31, 2005 until 5
business days after the Commencement Date in the Oak Ridge Technical Center One
Building (ORTC1 Building). The value of the extended occupancy in the ORTC4
Building is 12,793 RSF x $14.83/RSF x number of months (calculated as to partial
months on a per diem due basis) Tenant remains in current space beyond their
lease expiration date and shall be deducted or offset against the value of the
rental concession for the ORTC1 Building. By way of example only: If IPIX
remains in their current lease space in the ORTC4 Building until February 28th,
2005, the value of the extended occupancy period rent would be $15,810.02
(12,793RSF x $14.83/RSF /12). Thus the value of the rental concession in the
ORTC1 Building would be reduced to $49,332.13 (i.e. $65,142.15 - $15,810.02).
Rent abatement shall be applied against Annual Base Rent first due and owing. In
no event shall the value of the extended occupancy in the ORTC4 Building be
deemed to exceed $65,142.15.

6. ADDITIONAL ANNUAL RENT.

         6.a. DEFINITIONS. For the purposes of this Section 6.

                  1) ADDITIONAL ANNUAL RENT. Annual Additional Rent is Tenant's
Pro Rata Share of actual Operating Expenses for the prior calendar year reduced
by the product of the Expense Stop multiplied by 19,765 square feet, except that
Landlord will place a CAP of 4% per year over each preceding year of the Lease
Term, on the increase of the Controllable Operating Expenses of the Building,
excluding however, any increase in the Uncontrollable Operating Expenses, for
which Tenant will always pay its full Pro Rata Share of such increases, even if
such increases are greater than 4% over the previous year's costs.

                  2) BASE YEAR. The calendar year in which the Lease commences.

                  3) CONTROLLABLE OPERATING EXPENSES, Controllable Operating
Expenses are all Operating Expenses but for Uncontrollable Operating Expenses.

                  4) BUILDING. Building shall mean collectively, the Building,
the Premises, all common areas, the parking area, the land described in Exhibit
A, and any other improvements on said land.

                  5) EXPENSE STOP. Tenant's Annual Base Rent includes a
component applicable to the Operating Expenses equal to $6.27 per net rentable
square foot, which component is hereinafter referred to as the "Expense Stop."
The Expense Stop is an estimate of the Operating Expenses of the Building
(grossed up to 95% occupancy) as of December 15, 2004, and is the sum of (a)
$1.25 per net rentable square foot for electricity and gas serving the Premises
plus (b) $5.02 per net rentable square foot for all other Operating Expenses.

                  6) MONTHLY ESTIMATED ADDITIONAL RENT. Monthly Estimated
Additional Rent is the quotient of (a) Additional Annual Rent for the current
calendar year divided by (b) the number of complete months remaining in the
current calendar year following the month in which Tenant receives Landlord's
Annual Statement.

                  7) PRO RATA SHARE. Tenant's Pro Rata share is defined as the
ratio of the net rentable square footage of the Leased Premises to the total net
rentable square footage of the Building. In this Lease, the total net rentable
square footage of the Building is 35,100 square feet and Tenant's Pro Rata share
is 56.3106% subject to increase or decrease in the rentable square footage of
the Leased Premises.

                  8) SUBSEQUENT YEAR. Any calendar year following the Base Year.

                  9) UNCONTROLLABLE OPERATING EXPENSES. Uncontrollable Operating
Expenses are Landlord's costs for taxes, insurance and utilities.

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                  10) OPERATING EXPENSES. "Operating Expenses" as said term is
used herein shall consist of all reasonable and customary expenses of the
Building (as defined above) which shall be computed on the accrual basis and
shall consist of all expenditures by Landlord to maintain all facilities in
operation from the beginning of the term of this lease and such additional
facilities in subsequent years as may be reasonably determined by Landlord to be
necessary. All operating expenses shall be determined in accordance with
generally accepted accounting principles which shall be consistently applied.
All operating expenses shall be "grossed up" to 95% occupancy for the 2005 Base
Year and all subsequent lease years during the term.

         The term "Operating Expenses" as used herein shall mean all reasonable
and customary expenses, costs and disbursements (but not replacement of capital
investment items, new capital investment items, or specific costs especially
billed to specific Tenants) of every kind and nature which Landlord shall pay or
become obligated to pay because of or in connection with the operation of the
Building, including, but not limited to, the following:

                           a) Reasonable wages and salaries of all employees
engaged in the operation and maintenance, or access control, of the Building and
personnel who may provide traffic control relating to Ingress and egress to and
from the parking area to the adjacent streets. All wages, taxes, insurance and
benefits relating to employees providing these services, to the extent such
apply to operating and maintaining of the Building, shall be included.

                           b) All supplies, tools, equipment, and materials used
in operation and maintenance of the Building.

                           c) Costs of all utilities and taxes thereon,
including the cost of water and power, heating, lighting, air conditioning and
ventilating the Building.

                           d) Reasonable cost of all maintenance and service
agreements for the Building and the equipment therein, including, but not
limited to, security/fire alarm service, HVAC service, window cleaning, and
janitorial service including equipment, uniforms, supplies and sundries.

                           e) Cost of all reasonable insurance relating to the
Building (excluding terrorism insurance unless the same has been included in the
expenses for the Base Year), including, but not limited to, the cost of
casualty, rental abatement (to supplement loss of rents that may occur after
property damage while premises is being restored) and personal injury and
property liability insurance applicable to the Building and Landlord's personal
property used in connection therewith.

                           f) All real estate taxes, assessments and other
 charges and all non-capital improvement assessments and governmental charges,
whether federal, state county or municipal and whether they be by taxing
districts or authorities presently taxing the Building or by others,
subsequently created or otherwise, and any other taxes and assessments
attributable to the Building and its operation, together with the allocation
paid by the Landlord of such taxes, assessments, and charges attributable to the
tracts of land designated by Landlord as common area for the benefit of
occupants of the Building. Tenant will promptly pay any increase in ad valorem
taxes resulting from Tenant's personal property and form the value of Tenant's
leasehold improvements to the extent that same exceed Building standard
allowances.

                           g) Cost of repairs and general maintenance of the
Building.

                           h) Amortization of the cost of installation of
capital investment items which are for the purpose of reducing operation costs
(to the extent of any reduction thereby achieved) or which may be required by
governmental authority (as a result of changes of law after the Lease
Commencement Date) and will reduce operation costs.

                           i) Reasonable landscape maintenance costs for the
Building and the tracts of land designated by Landlord as common area for the
benefit of occupants of the Building.

                           j) Any lease payments made by Landlord for any
equipment (i.e., personal property only) used in the operation and maintenance
of the Building.

                           k) Legal, architectural or engineering fees incurred
directly in connection with services required to be provided by Landlord to its
tenants and Landlord's central accounting costs applicable to the Building.

                           l) Management fees paid to the manager of the
Building (who may be Landlord or a person or entity related to or affiliated
with Landlord) equal to a maximum of four percent (4)% of the gross income
received by Landlord in connection with the Building.

                           m) All assessments and charges imposed against the
Building under any private covenant, restriction or easement agreement.

                  11) OPERATING EXPENSE EXCLUSIONS. Notwithstanding anything in
this Lease to the contrary, the

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following expenses are excluded from Building Operating Expenses:

                           a) Repairs or other work occasioned by fire,
windstorm or other insurable casualty or condemnation to the extent such expense
is actually covered by the insurance proceeds or the condemnation award, as the
case may be.

                           b) Leasing commissions, attorney's fees, costs and
disbursements and other expenses incurred in connection with negotiations or
disputes with tenants, other occupants, or prospective tenants or other
occupants.

                           c) Expenses incurred in renovating or otherwise
improving or decorating, painting or redecorating space for tenants or other
occupants or vacant space.

                           d) Landlord's costs of electricity and other services
sold to tenants and for which Landlord is entitled to be reimbursed by such
tenants as an additional charge or rental over and above the basic rent payable
under the lease with such tenant.

                           e) Except as otherwise provided above, costs incurred
by Landlord for alterations, repairs or replacements which are considered
capital expenditures under generally accepted accounting principles.

                           f) Expenses in connection with services or other
benefits of a type which are not provided Tenant but which are provided to
another tenant or occupant.

                           g) Costs incurred due to violation by Landlord or any
tenant of the terms and conditions of any lease.

                           h) Overhead and profit increment paid to subsidiaries
or affiliates of Landlord for services on or to the real property, to the extent
only that the costs of such services exceed competitive costs of such services
were they not so rendered by a subsidiary or affiliate.

                           i) Interest on debt or amortization payments on any
mortgage or mortgages, and rental under any ground or underlying leases or
lease.

                           j) Any compensation paid to clerks, attendants, or
other persons in commercial concessions operated by Landlord.

                           k) Advertising and promotional expenditures.

                           l) Expenses for the replacement of any item covered
under warranty.

                           m) Cost to correct any penalty or fine incurred by
Landlord due to Landlord's violation of any federal, state, or local law or
regulation and any interest or penalties due for late payment by Landlord of any
operating expenses.

                           n) Landlord's general corporate overhead and
administrative expenses, except if it is solely for the Building.

                           o) Interest or penalties arising by reason of
Landlord's failure to timely pay any Operating Expenses.

         6.b. Tenant agrees to pay Landlord Additional Annual Rent beginning on
January 1 of the year following the Base Year, and for each Subsequent Year (or
part of one) during the Term of this Lease in accordance with the following:

                  1) Tenant agrees to pay to Landlord the Monthly Estimated
Additional Rent on the first day of each month remaining in the applicable
calendar year, which Monthly Estimated Additional Rent is paid by Tenant toward
Tenant's Additional Annual Rent obligation for the calendar year in which the
Monthly Estimated Additional Rent payment is paid;

                  2) Within 90 days after the end of each calendar year (and the
Termination Date, if it is not the last day of a calendar year), Landlord will
deliver to Tenant a statement (the "Annual Statement") that: (i) details the
actual Operating Expenses for the prior calendar year; (ii) states the total
Additional Annual Rent due by Tenant for the prior calendar year; (iii) states
the total Monthly Estimated Additional Rent paid by Tenant during the prior
calendar year; (iv) states the Monthly Estimated Additional Rent to be paid by
Tenant for each month during the remainder of the current calendar year; and (v)
states the amount of overpayment or underpayment by Tenant toward Additional
Annual Rent for the prior calendar year;

                  3) If the statement reflects that Tenant has overpaid its
Additional Annual Rent for the prior calendar year, then Landlord agrees to pay
Tenant the difference within 30 days of delivery of the applicable Annual
Statement;

                  4) If the statement reflects that Tenant has underpaid its
Additional Annual Rent for the prior calendar year, then Tenant agrees to pay
Landlord the difference within 30 days of receiving the applicable Annual
Statement; and

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                  5) Nothing contained in this Section 6 shall be construed at
any time so to reduce the monthly installments of Base Annual Rent payable
hereunder below the amount set forth in Article 5 of this Lease.

         6.c. Landlord shall maintain records concerning estimated and actual
operating costs for thirty-six (36) months following the period covered by the
statement or statements furnished Tenant after which Landlord may dispose of
such records. Tenant and Tenant's auditors may inspect Landlord's records during
Landlord's normal business hours at the office where Landlord maintains its
Building Operating Expense records and only upon first furnishing fourteen (14)
day advance written notice. Tenant shall, however, be entitled to only one such
inspection each calendar year (which may be more than 1 day). No audit shall be
conducted at anytime that Tenant is in default of any terms of this Lease. No
subtenant shall have any right to conduct an audit and no assignee shall conduct
an audit for any period during which such assignee was not in possession of the
Premises. Tenant shall deliver to Landlord a copy of the results of such audit
within fifteen (15) days of receipt by Tenant.

         6.d. During the course of any audit of the Operating Expenses, Tenant
shall pay the amount in dispute. Any audit conducted pursuant to sub-article
6.g. shall be conducted at Tenant's sole cost and expense. If the audit shows
that Tenant has made an underpayment, Tenant shall reimburse Landlord for the
amount of the underpayment within thirty (30) days following such determination.
If the audit shows that Tenant has made an overpayment, Landlord shall reimburse
Tenant for the amount of the overpayment within thirty (30) days following such
determination, provided, however, that Landlord shall have the right to contest
Tenant's audit before any payment obligation shall be due.

7. OTHER RENT. Any monetary obligation owed by Tenant to Landlord pursuant to
the terms of this Lease in addition to Annual Base Rent and Annual Additional
Rent shall be deemed to be rent and shall hereinafter be referred to as "Other
Rent". All Other Rent shall be due and payable by Tenant to Landlord within
thirty (30) days of Landlord's invoice for same to Tenant. All past due Other
Rent shall bear interest at the highest rate allowed by law (not to exceed prime
plus 3) from date which is ten (10) days after its due date until paid in full.
Annual Base Rent, Annual Additional Rent and Other Rent may hereinafter
sometimes collectively be referred to as "Rent."

8. DEPOSIT. Tenant had deposited with Landlord the sum of NONE-DEPOSIT IS WAIVED
Dollars $(00.00) ("Deposit").

9. USE. Tenant may only use the Premises for general office purposes and uses
ancillary thereto and shall not use or permit the Premises to be used for any
other purpose without the prior written consent of Landlord. Tenant shall not do
or permit anything to be done in or about the Premises nor bring or keep
anything therein which will in any way increase the existing rate of or affect
any fire or other insurance upon the Building or any of its contents, or cause
cancellation of any insurance policy covering said Building or any part thereof
or any of its contents.

10. COMPLIANCE WITH THE LAW. Subject to any contrary provision of this Lease,
Landlord shall be responsible, as regards the Building's common areas, and
Tenant shall be responsible, as regards the Premises (other than structural or
base building portions thereof), for compliance with and for all of the costs to
comply with the Americans With Disabilities Act of 1990, as subsequently
amended, and all regulations promulgated thereunder ("ADA"), the City of Oak
Ridge Building Codes, the State of Tennessee Accessibility Standards, and all
other present and future laws, ordinances, requirements, orders, directives,
rules and regulations of federal, state, county and city governments and of all
other governmental authorities having or claiming jurisdiction over the Property
(the "Laws"). The cost of compliance with the ADA and the Laws shall be borne as
follows:

         10.a. The cost of bringing Building common areas into compliance with
the ADA and the Laws as of the Commencement Date and at all times during the
Term shall be the sole responsibility of Landlord;

         10.b. Landlord hereby warrants that Premises are (i) in compliance with
ADA and the Laws (including all building and fire codes) and (ii) fully
sprinklered, as of the Commencement Date. Tenant shall, therefore, be
responsible throughout the Term, as regards the Premises (which shall include
lavatories within the Premises) for the cost of any additional compliance
required by the ADA and/or the Laws;

         10.c. Within ten (10) days after receipt, Landlord and Tenant shall
advise the other party in writing, and provide the other with copies of any
notices alleging violation of the ADA or the Laws relating to any portion of the

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Building or the Premises, as applicable, any claims made or threatened in
writing regarding non-compliance with the ADA or the Laws and relating to any
portion of the Building or the Premises, as applicable, or any governmental or
regulatory actions or investigations instituted or threatened regarding
noncompliance with the ADA or the Laws and relating to any portion of the
Building or the Premises, as applicable;

         10.d. In its use of the Premises and the remainder of the Building,
Tenant shall not violate any of the Laws; and

         10.e. Landlord and Tenant agree to defend, indemnify and hold each
other harmless from and against any loss, claims, demands, costs (including
attorney fees and disbursements), damages, fines, causes of action or penalties
resulting from any violations of the ADA or the Laws in the area or areas for
which each party is responsible.

11. ALTERATIONS AND ADDITIONS. During the Term, Tenant may without Landlord's
prior consent, make nonstructural improvements, alterations or additions to the
Premises (not adversely affecting building systems) through contractors selected
by Tenant and acceptable to Landlord. Other alterations shall require Landlord's
prior written consent thereto, which consent shall not be unreasonably withheld.
Such work shall be done at Tenant's sole cost and expense and in a workmanlike
manner with materials and finishes comparable to those then existing in the
Premises. Improvements, alterations or additions that shall affect Building
electrical, plumbing, mechanical or HVAC systems or the Building's structural
components shall be made only with the prior written consent of Landlord,
regardless of the cost. Landlord shall assess no "overhead" or "supervision" fee
or charge to Tenant in connection with such work performed by Tenant's
contractors, except as may be mutually agreed upon between Landlord and Tenant,
nor shall Tenant be charged for Building services provided to Tenant's
contractors, with the exception of after hours HVAC charges, if such service is
required. If Tenant makes any improvements, alterations or additions during the
Term, Tenant agrees that:

         11.a. Any contractor or person selected by Tenant to make the
improvements, alteration or additions must first be approved in writing by the
Landlord.

         11.b. Tenant and its contractors will, prior to commencement of the
construction, furnish Landlord with proof satisfactory to Landlord that Tenant
and its contractors are in compliance with all insurance requirements of
Landlord and all laws, ordinances, rules and regulations of all governmental
authorities;

         11.c. Tenant shall discharge by payment, bond or otherwise, any
mechanics's and materialman's lien filed against the Property for work, labor,
services or materials performed at or furnished to the Premises and Tenant shall
do so within fifteen (15) days of the date such lien was filed without demand by
Landlord;

         11.d. Tenant will furnish Landlord with proposed plans and copies of
all necessary permits prior to commencing construction of such improvements,
alterations or additions and with as-builts upon completion of such
construction; and

         11.e. Tenant will cause its contractors to work harmoniously with
Landlord and Landlord's contractors and to reasonably cooperate with Landlord
and Landlord's tenants and their invitees in respect of entering and exiting the
Building, and not take any action or fail to take such action as may be
inconsistent with routine Building operations.

         Any alteration, additions or improvements to or of the Premises,
including, but not limited to, wall coverings, paneling and built-in cabinet
work, but excepting movable furniture and trade fixtures installed by Tenant,
shall on the expiration of the Term become a part of the realty and belong to
the Landlord and shall be surrendered with the Premises. Tenant, at its sole
expense, shall promptly repair any damage caused by its removal of movable
furniture and trade fixtures and shall promptly restore any Building HVAC,
electrical or other system impaired by such removal to good operating order and
condition.

12. TENANT REPAIRS. By taking possession of the Premises, subject to the terms
and conditions set forth in Article 4.b. of this Lease, Tenant shall be deemed
to have accepted the Premises as being in good, sanitary order, condition and
repair, subject to latent defects and punch list items. Tenant shall, at
Tenant's sole cost and expense,

                                       8
<PAGE>

make all repairs necessary to maintain the Premises (other than structural
repairs or repairs to base building work) in such condition and state as is
consistent with similar premises in first class buildings in the Building's
market area, ordinary wear and tear excepted, and shall keep the Premises and
fixtures therein in neat and orderly condition, except Tenant shall not be
required to make any repairs required of Landlord in Article 13 hereof. All the
aforesaid repairs shall be of quality or class equal to the original work or
construction. If Tenant refuses or neglects to expeditiously complete any such
repairs, Landlord may, following notice and reasonable opportunity to cure, make
such repairs at the expense of Tenant and Landlord's actual costs shall be
collectable as Other Rent.

         Except as specifically provided in an addendum, if any, to this Lease,
Landlord shall have no obligation whatsoever to alter, remodel, improve, repair,
decorate or paint the Premises or any part thereof and the parties hereto affirm
that Landlord has made no representations to Tenant respecting the condition of
the Premises or the Building except as specifically herein set forth.

13. LANDLORD REPAIRS; SERVICES AND UTILITIES.

         13.a. Provided that Tenant is not in default of this Lease, Landlord,
without cost to Tenant (except as otherwise provided in Article 6), shall
maintain, repair and replace, as necessary, all structural and non-structural
portions of the Property, and all service systems for the same, including,
without limitation, the plumbing, sprinkler, heating, ventilating and air
conditioning systems, Building electrical and mechanical lines and equipment
associated therewith, and elevators and boilers, the exterior and interior
structure of the Building and all other structures situated on the Property, the
interior walls, ceilings, floors and floor coverings of common areas, lighting
in common areas, and the exterior improvements to the Property; provided,
however, that if the need for such maintenance, repairs or replacements is
caused in whole or in part by the act, neglect, fault or omission of any duty by
the Tenant, its agents, servants, employees or invitees, Tenant shall (except as
to any items subject to Section 17(a)(2)) pay to Landlord the reasonable cost of
such maintenance and repairs as Other Rent. All the aforesaid repairs shall be
of quality or class equal to the original work or construction.

         13.b. Provided that Tenant is not in default of the Lease, Landlord
shall provide the following services to the Premises, without cost to Tenant
(except as otherwise provided herein and in Article 6): (a) janitorial service
(per Addendum C) on a schedule and at a level consistent with that for other
first class buildings in the Building's market area, (b) HVAC sufficient to
provide for comfortable use and occupancy of the Premises in accordance with
Exhibit E from 7:00 a.m. to 6:00 p.m. during weekdays, 8:00 a.m. to 1:00 p.m. on
Saturdays and (c) electricity (24 hours per day, seven days pre week) for normal
lighting and general office machines of a type which require no more than a 110
volt duplex outlet, (excepting that equipment requiring 220 volts which may be
limited in quantity due to electrical code specifications). Should Tenant
require after-hours HVAC, Tenant will give Landlord notice of such requirement
at least one (1) business day prior to such requirement. Tenant will be
responsible for the cost of any after hours usage of HVAC at a rate of $25 per
hour. Whenever heat generating machines or equipment, other than the general
office machines referenced above, are used in the Premises which affect the
temperature otherwise maintained by the air conditioning system, Landlord
reserves the right to install supplementary air conditioning units in the
Premises and the cost thereof, including the cost of installation, and the cost
of operation and maintenance thereof shall be paid by Tenant to Landlord as
Other Rent.

         13.c. Upon notification by Tenant of the need for repairs or the
restoration of services, Landlord shall proceed with due diligence to begin to
make repairs or to perform maintenance considering the emergency or routine
nature of the situation. There shall be no abatement of Rent and no liability of
Landlord by reason of any injury to or interference with Tenant's business
arising from the cessation of services or the making of any repairs, alterations
or improvements in or to any portion of the Property or the Premises or in or to
fixtures, appurtenances and equipment therein, unless the Premises are rendered
untenantable in whole or in part for a period of more than three (3) business
days. In that event and only in that event, Tenant's sole remedy shall be a
proportionate reduction of Annual Base Rent until the services are restored or
the repair is made.

         13.d. Tenant will not, without written consent of Landlord, use any
apparatus or device in the Premises, including, by without limitation thereto,
electronic data processing machines and machines using in excess of 220 volts,
which will in any way increase the amount of electricity usually furnished or
supplied for the use of the Premises as general office space; nor connect with
electric current except through existing electrical outlets in the Premises, any
apparatus or device, for the purpose of using electric current. If Tenant shall
require water or electric

                                       9
<PAGE>

current in excess of that usually furnished or supplied for the use of the
Premises as general office space, Tenant shall first procure the written consent
of Landlord, which Landlord may refuse, to the use thereof and Landlord may
cause a water meter or electrical current meter to be installed in the Premises,
so as to measure the amount of water and electric current consumed for any such
use. The cost of any such meters and of installation, maintenance and repair
thereof, and the cost of all such water and electric current consumed as shown
by said meters plus any additional expense incurred in keeping account of the
water and electric current so consumed shall be paid for by Tenant as Other
Rent. If a separate meter is not installed, such excess cost for such water and
electric current will be established using a method mutually acceptable to
Landlord and Tenant and paid for by Tenant as Other Rent.

14. LIENS. Tenant shall keep the Premises and the Building free from any liens
arising out of any work performed, materials furnished or obligations incurred
by Tenant.

15. ASSIGNMENT AND SUBLETTING. Tenant shall not either voluntarily or by
operation of law, assign, transfer, mortgage, pledge, hypothecate or encumber
this Lease or any interest therein, and shall not sublet all or any part of the
Premises, or any right or privilege appurtenant thereto, or suffer any other
person (the employees, agents, servants and invitees of Tenant excepted) to
occupy or use the said Premises, or any portion thereof; provided, however, that
Tenant may, after first obtaining the written consent of Landlord, which consent
shall not be unreasonably withheld, assign this Lease or sublet the Premises, or
part thereof, to an affiliate of Tenant, such as a parent, subsidiary or sister
corporation or to another reputable firm (which as to an assignee or a sublessee
of the entire Demised Premises shall be) of financial means adequate to pay all
Lease related rents, liabilities and costs. Should Tenant assign or sublease all
or any portion of the Premises to a merged entity or affiliate, the affiliate or
merged entity shall have the same rights as Tenant under the Lease, especially
with regard to renewal options, rights of first refusal, and expansion options.

16. HOLD HARMLESS.

         16.a. Tenant shall defend and indemnify Landlord and save Landlord
harmless from and against any and all losses, claims, liability, expenses,
damages (other than consequential damages), and attorney's fees which, either
directly or indirectly, in whole or in part, arise out of or result from the
negligence or willful misconduct of Tenant, its agents, contractors or
employees.

         16.b. Landlord shall defend and indemnify Tenant and save Tenant
harmless from and against any and all losses, claims, liability, expenses,
damages (other than consequential damages) and attorney's fees which, either
directly or indirectly, in whole or in part, arise out of or result from the
negligence or willful misconduct of Landlord, its agents, contractors or
employees.

         16.c. Nothing in this Article 16 is intended to require indemnification
for any claim for which insurance is required to be maintained under the terms
of this Lease. The rights and obligations of Landlord and Tenant under this
Article 16 shall survive the expiration or earlier termination of this Lease.

17. INSURANCE.

         17.a. Tenant shall maintain, at its expense, with an insurer(s) holding
a Best Rating of AAA or higher and reasonably acceptable to Landlord:

                  1) Standard Commercial General Liability Insurance. The limits
of liability of such insurance shall be an amount not less than One Million
Dollars ($1,000,000) per occurrence, Personal Injury, including death and One
Million Dollars ($1,000,000) per occurrence, Property Damage Liability, or Five
Million Dollars ($5,000,000) combined single limit for Personal Injury and
Property Damage Liability. Such policies shall name Landlord as additional
insured and extend to any liability of Tenant arising out of the indemnities of
Tenant under this Lease and include contractual liability coverage. Such
policies shall not be cancelable or subject to reduction without thirty (30)
days written notice to the insureds; and

                  2) "All risk" property insurance on Tenant's personal
property. This insurance shall include fire and extended coverage perils. Such
property insurance policy shall contain appropriate endorsements waiving the
insurer's right of subrogation against Landlord; and

                                       10
<PAGE>

                  3) Worker's Compensation and Employer's Liability insurance as
required by state law, or if self-insured, Tenant shall indemnify and hold
harmless Landlord from all claims, demands, actions, liabilities, costs,
expenses, damages, fines, reimbursement, restitution, and obligations (including
investigative responses and attorney's fees) arising from acts or omissions
which would have been covered by such insurance had Tenant carried same.

                  4) At Tenant's option, Tenant may provide the coverage
required above through blanket policies of insurance covering Tenant's other
properties or Tenant may self-insure. In the event Tenant elects to self-insure,
Tenant shall so advise Landlord in writing and Tenant shall furnish Landlord
with copies of Tenant's monthly income statements and balance sheets and
Tenant's audited annual income statements and balance sheets within 30 days of
preparation of same. If Tenant has elected to self-insure and Landlord, in
Landlord's sole and unfettered discretion, is unsatisfied with Tenant's
financial condition at any time, Landlord may require Tenant to obtain policies
from insurer(s) reasonably acceptable to Landlord providing the coverages
required by this Section 17.a. within ten days of Landlord's written notice of
such requirement to Tenant. If Tenant fails to obtain such policies within said
ten (10) days, Tenant shall be in material breach of this Lease.

         17.b. Tenant shall deliver copies of all of these insurance policies or
an appropriate certificate of insurance issued by a reputable supplier of
insurance reflecting all the above-required insurance coverage to Landlord prior
to the Commencement Date. If Tenant fails to procure and maintain any of these
insurance policies, Landlord may, at its option, after notice and Tenant's
failure to cure within fifteen (15) days of such notice, procure and maintain
same at the expense of Tenant, which expense shall be billed to Tenant as Other
Rent.

         17.c. Landlord shall maintain, at its expense except as otherwise
provided in Article 6, insurance through such carriers and in such amounts as is
required by its mortgagee to be maintained by Landlord. All such property
insurance shall contain waivers of subrogation in favor of Tenant.

18. PERSONAL PROPERTY TAXES. Tenant shall pay, before delinquency, any and all
taxes levied or assessed upon Tenant's equipment, furniture, fixtures and
personal property located in the Premises, except that which has been paid for
by Landlord, and taxed with the Building. Tenant shall pay to Landlord, as Other
Rent, Tenant's share of such taxes within thirty (30) days after delivery to
Tenant by Landlord of a statement in writing setting forth the amount of such
taxes applicable to Tenant's property.

19. RULES AND REGULATIONS. Tenant shall faithfully observe and comply with the
rules and regulations set forth in Addendum B to this Lease, and any reasonable
rules and regulations imposed by Landlord during the Term and not inconsistent
with this Lease. Landlord reserves the right to make reasonable modifications to
said rules, provided such modifications do not conflict with other terms of this
Lease. The additions and modifications to those rules shall be binding upon
Tenant upon delivery of a copy of them to Tenant. Landlord shall not be
responsible to Tenant for the failure of other tenants to comply with said
rules, but Landlord shall use its best efforts to enforce uniform compliance
with such rules by all tenants.

20. HOLDING OVER.

         20.a. If Tenant, with Landlord's consent, remains in possession of the
Premises or any part thereof after the expiration of the Term hereof, such
occupancy shall be a tenancy from month to month upon all the provisions of this
Lease pertaining to the obligations of Tenant and the rent payable shall be one
hundred and three percent (103%) of the rent payable immediately preceding the
termination date of this Lease (but with no inflation of Operating Expenses
unless it is a new calendar year and an increase in Operating Expenses is due
all tenants), but all options, if any, granted under the terms of this Lease
shall be deemed terminated and be of no further effect during such month to
month tenancy.

         20.b. If Tenant, without the consent of Landlord, remains in possession
of the Premises or any part thereof after the expiration of the Term hereof,
then Tenant shall be a tenant at sufferance only, and shall pay Landlord for
each month of such retention one hundred and fifty percent (150%) of the amount
of the monthly rent for the last period prior to the date of such termination
(but with no inflation of Operating Expenses unless it is a new calendar year
and an increase in Operating Expenses is due all tenants) and shall also pay as
to any holdover in excess of

                                       11
<PAGE>

sixty (60) days all damages sustained by Landlord by reason of such retention.
Acceptance by Landlord of such payments after such termination shall not
constitute Landlord's consent to such holding over or to a renewal of this
Lease. Nothing in this paragraph shall operate as a waiver of Landlord's right
of re-entry or any other right of Landlord and Landlord shall be entitled to
take all lawful action for Tenant's immediate removal from the Premises.

21. ENTRY BY LANDLORD. Landlord reserves and shall at reasonable times, given
prior notice during business hours, have the right to enter the Premises,
inspect the same, supply janitorial service and any other service to be provided
by Landlord to Tenant hereunder, to submit said Premises to prospective
purchasers or tenants within the final 12 months of the Term, and to alter,
improve or repair the Premises and any portion of the Building of which the
Premises are a part, without abatement of Rent, provided, however, that prior
notice shall not be required in emergencies. Landlord may erect scaffolding and
other necessary structures where reasonably required by the character of the
work to be performed, always providing that the entrance to the Premises shall
not be blocked thereby, and further providing that the business of the Tenant
shall not be interfered with unreasonably. Tenant hereby waives any claim for
damages or for any injury or inconvenience to or interference with Tenant's
business, any loss of occupancy or quiet enjoyment of Premises, and any other
loss occasioned thereby. For each of the aforesaid purposes, Landlord shall at
all times have and retain a key with which to unlock all of the doors in, upon
and about the Premises, excluding Tenant's vaults, safes and files, and Landlord
shall have the right to use any and all means which Landlord may deem proper to
open said doors in an emergency, in order to obtain entry to the Premises
without liability to Tenant except for any failure to exercise due care for
Tenant's property. Any entry to the Premises obtained by Landlord by any of said
means, or otherwise shall not under any circumstances be construed or deemed to
be a forcible or unlawful entry into, or a detainer of, the Premises, or an
eviction of Tenant from the Premises or any portion thereof.

22. DAMAGE TO PREMISES.

         22.a. If the Property or any portion thereof is damaged by fire or
other casualty, then, except as provided below, Landlord shall proceed with due
diligence to commence to repair the same at the expense of Landlord. Until such
repairs and restoration are substantially completed, the Annual Base Rent and
Annual Additional Rent shall be proportionately abated based upon the square
footage in the Premises rendered unusable by the fire or casualty to the extent
that Tenant is deprived of the use of all or any portion of the Premises as a
result of damage to the Premises and/or other portions of the Building,
provided, however, that Tenant shall not be entitled to any such abatement if
such casualty was caused by intentional or grossly negligent acts of Tenant
except to the extent covered by Landlord's rent loss insurance. Landlord shall
notify Tenant in writing within thirty (30) days of such damage as to whether
the damage is susceptible of substantially complete repair within one hundred
eighty (180) days after the occurrence. If such damage to the Building shall not
be susceptible of substantially complete repair and restoration within one
hundred eighty (180) days after the occurrence of such casualty, and, such
damage materially and adversely interferes with the conduct of Tenant's business
within any remaining undamaged portion(s) of the Premises, then Tenant may, by
written notice to Landlord. terminate this Lease as of the date of occurrence of
such damage, provided such notice is given within forty-five (45) days after the
date of such casualty. Otherwise, should such damage to the Building not be
susceptible of substantially complete repair and restoration within one hundred
eighty (180) days, but such damage does not materially and adversely interfere
with the conduct of Tenant's business within any remaining undamaged portion(s)
of the Premises, Tenant shall not have the right to terminate this Lease so long
as Landlord promptly commences and diligently pursues restoration and repair of
the Premises (or Building, as relevant) and the above referenced rent abatement
shall continue in effect until restoration and repair is substantially
completed.

         22.b. If such damage can be repaired within one hundred eighty (180)
days from the date of such casualty, and Landlord notifies Tenant in writing
within said thirty (30) day period of its intent to repair and restore the
Premises, Annual Base Rent and Annual Additional Rent shall be proportionately
abated based upon the square footage in the Premises rendered unusable by the
fire or casualty during the period of repair and restoration, as set forth
above, and this Lease shall not terminate.

         22.c. Notwithstanding the foregoing provisions of this Paragraph 22, in
the event that any portion of the Premises or the Building is damaged during the
last twelve (12) months of the Term, then Landlord shall have the option to
terminate this Lease upon thirty (30) days' prior written notice to Tenant. In
the event of the termination of

                                       12
<PAGE>

this Lease pursuant to this Paragraph 22, Annual Base Rent and Annual Additional
Rent shall be prorated as of the date of such termination.

         22.d. Tenant acknowledges that Landlord need not obtain insurance of
any kind on Tenant's furniture, furnishings or any equipment, fixtures,
alterations or improvements, or additions installed at Tenant's request, and
that it is Tenant's obligation to obtain all such insurance at Tenant's sole
cost and expense and that Landlord shall not be obligated to repair any damage
thereto or replace same.

         22.e. Landlord and Tenant do each hereby release and discharge the
other party and any officer, agent, employee or representative of such party
from any liability, regardless of such parties' negligence, for loss or damage
to property caused by fire or other casualty for which insurance (containing
waiver of subrogation) is required to be carried by the injured party under the
terms of this Lease (and for purposes hereof, Landlord's insurance shall provide
(or be deemed to provide) coverage not less than that to be carried by Tenant
pursuant to the provisions hereof). Landlord and Tenant shall each have included
in all polices of commercial property insurance, commercial general liability
insurance, and business interruption and other insurance obtained by them
covering the Premises and the Building, a waiver by the insurer of all right of
subrogation against the other in connection with any loss or damage thereby
insured against. Any additional premium for such waiver shall be paid by the
primary insured.

23. DEFAULT. The occurrence of any one or more of the following events shall
constitute a material default and breach of this Lease:

         23.a. Tenant's abandoning the Premises without the continuation of Rent
payment as obligated hereunder.

         23.b. Tenant's failing to pay in full any installment of Annual Base
Rent or Annual Additional Rent or failing to pay in full Other Rent within ten
(10) days after receiving written notice that the same is overdue.

         23.c. Tenant's failing to observe or perform any other covenant,
condition or provision of this Lease to be observed or performed by the Tenant,
where such failure shall continue for a period of thirty (30) days after written
notice thereof by Landlord to Tenant; provided, however, that if the nature of
Tenant's default is such that more than thirty (30) days is reasonably required
for its cure, then Tenant shall not be deemed to be in default if Tenant
commences such cure within said thirty (30) days and thereafter diligently
prosecutes such cure to completion.

         23.d. The making by Tenant of any general assignment or general
arrangement for the benefit of creditors; or the filing by or against Tenant of
a petition to have Tenant adjudged a bankrupt, or a petition or reorganization
or arrangement under any law relating to bankruptcy (unless, in the case of a
petition filed against Tenant, the same is dismissed within sixty (60) days); or
the appointment of a trustee or a receiver to take possession of a substantially
all of Tenant's assets located at the Premises or of Tenant's interest in this
Lease where such seizure is not discharged in thirty (30) days.

         23.e. Landlord shall file or have filed against it a petition or case
under any section or chapter of the United States Bankruptcy Code, as amended,
or under any similar law or statute of the United States or any State and such
case or petition is not discharged within sixty (60) days; the foregoing shall
be an event of default and Tenant shall have all rights, powers and remedies
available at law or equity.

24. REMEDIES IN DEFAULT. In the event of any material default or breach by
Tenant, Landlord may at any time thereafter, with or without notice or demand
and without limiting Landlord in the exercise of a right or remedy which
Landlord may have reason of such default or breach:

         24.a. Terminate this Lease in writing, in which case Tenant shall
immediately surrender possession of the Premises to Landlord. In such event
Landlord shall be entitled to recover from Tenant all direct damages incurred by
Landlord by reason Tenant's default including, but not limited to, all Rents
owed as of the date of termination; the cost of recovering possession of the
Premises; that portion of the leasing commission paid by Landlord and build-out
expenses incurred by Landlord in connection with this Lease and applicable to
the unexpired Term; and all attorney's fees, costs and expenses incurred by
Landlord in enforcing its remedies against Tenant.

                                       13
<PAGE>

         24.b. Terminate Tenant's right to possession without terminating this
Lease and enter upon and take possession of the Premises by dispossessory suit
or otherwise. Tenant shall continue to be liable for all Rent as it becomes due.
Landlord may bring actions to collect amounts due from Tenant from time to time
on one or more occasions, without the necessity of Landlord's waiting until the
expiration of the Term. At any time during the remainder of the Term following
the termination of Tenant's right to possession, Landlord may elect to make such
alterations, redecorations and repairs as, in Landlord's reasonable judgment,
may be necessary to re-let the Premises and Landlord may re-let the Premises or
any portion thereof for such term or terms and such rental or rentals as
Landlord may reasonably deem advisable. In the event Landlord elects to re-let
the Premises or a portion thereof, Landlord shall receive the rent therefore,
Tenant hereby agreeing to pay to Landlord the deficiency, if any, between all
Rent reserved hereunder and the total rental applicable to the Term hereof
obtained by Landlord by re-letting. In the event Landlord elects to re-let,
Tenant shall be liable for Landlord's reasonable and necessary expenses in
redecorating and restoring the Premises and all reasonable and necessary costs
incident to such re-letting, including broker's commissions. In no event shall
Tenant be entitled to any rentals received by Landlord in excess of the amounts
due by Tenant hereunder. In the event Landlord is unable to re-let the Premises
after using reasonable efforts to do so, Tenant shall be liable to Landlord for
all Rents which have accrued as of the time of the election plus the present
value of all future rentals as of the date of the election. Landlord's election
as to whether or not to re-let can only be made in writing and no conduct of
Landlord may be construed as the making of that election. Landlord shall use
reasonable efforts to mitigate its damages.

         24.c. Pursue any other remedy now or hereafter available to Landlord
under the laws or judicial decision of the State in which the Premises are
located.

25. EMINENT DOMAIN. If twenty-five percent (25%)or more of the Premises shall be
taken under the power of eminent domain or conveyed in lieu thereof, then either
party shall have the right, at its option, to terminate this Lease at such time
by furnishing written notice to the other party. In that event, Landlord shall
be entitled to any and all income, rent award, or any interest therein
whatsoever which may be paid or made in connection with such taking, except that
Tenant shall have the right to claim, in a separate proceeding, a condemnation
award for the value of its personal property, and equipment, if any, plus moving
and relocation expenses so long as such separate award does not substantially
diminish the award payable to Landlord in respect of such taking. If less than
twenty-five percent (25%) of the Premises is taken or if neither party elects to
terminate as provided above, the rental thereafter to be paid shall be equitably
reduced. If any part of the Building other than the Premises is taken or
appropriated, Landlord shall have the right at its option to terminate this
Lease and shall be entitled to the entire award except as above provided.

26. ESTOPPEL CERTIFICATE. Upon not less than fifteen (15) days prior written
notice from Landlord, Tenant shall execute, acknowledge and deliver to Landlord
a statement in writing, (a) certifying that this Lease is unmodified and in full
force and effect (or, if modified, stating the nature of such modification and
certifying that this Lease as so modified, is in full force and effect), and the
date to which the rental and other charges are paid in advance, if any, and (b)
acknowledging that there are not, to Tenant's knowledge, any uncured defaults on
the part of the Landlord hereunder, or specifying such defaults if any are
claimed. Any such statement may be relied upon by any prospective purchaser or
encumbrancer of all or any portion of the real property of which the Premises
are a part.

27. PARKING. Tenant shall at all times during the Term have, without additional
charge, the right to park up to 4.5/1000 (s. f. of net rentable area) cars in
the Building's parking area. Of these parking spaces allocated to Tenant, Nine
(9) shall be reserved spaces for either Tenant's visitors or employees. Landlord
may make, modify and enforce reasonable rules and regulations relating to the
parking of automobiles in the parking area, so long as such modifications do not
conflict with other terms of this Lease, and Tenant will abide by such rules and
regulations.

28. AUTHORITY OF PARTIES. Each individual executing this Lease on behalf of a
corporation or partnership warrants that he or she is duly authorized to execute
and deliver this Lease on behalf of said entity; that if such entity is a
corporation, his/her execution of this Lease in its behalf is in accordance with
a duly adopted resolution of the board of directors of said corporation or in
accordance with the by-laws of said corporation; and that this Lease is binding
upon said entity in accordance with its terms.

                                       14
<PAGE>

29. LANDLORD'S LIMITED LIABILITY. Landlord shall have no personal liability with
respect to any of the provisions of this Lease. If Landlord is in default with
respect to its obligations under this Lease, Tenant shall look solely to the
equity of Landlord in and to the Building for satisfaction of Tenant's remedies.
In no event shall any partner of Landlord, nor any joint venturer or partner in
Landlord, nor any officer, director or shareholder of Landlord be personally
liable with respect to any of the provisions of this Lease.

30. LANDLORD'S LIEN. Landlord waives any contractual lien for rent, but retains
its statutory lien for rent.

31. HAZARDOUS MATERIALS.

         32.a. "Toxic or Hazardous Substances" shall be interpreted to mean any
material or substance that is defined or classified under federal, state or
local laws as:

                  1) A "hazardous substance" pursuant to Section 101 of the
Comprehensive Environmental Response Compensation and Liability Act ("CERCLA"),
42 U.S.C. Section 9601(14), Section 311 of the Federal Water Pollution Control
Act, 33 U.S.C. Section 1321, as now or hereafter amended;

                  2) A "hazardous waste" pursuant to Section 1004 or Section
3001 of the Resource Conservation and Recovery Act, 42 U.S.C. Section 6903, 42
U.S.C. Section 6921, as now or hereafter amended;

                  3) A "toxic pollutant" pursuant to Section 37(1)(a) of the
Federal Water Pollution Control Act, 33 U.S.C. Section 1317(1)(a); and

                  4) "Toxic or Hazardous Substances" pursuant to regulations
promulgated now or hereafter under the aforementioned laws.

         32.b. Tenant hereby agrees that (i) Tenant will conduct no activity on
the Premises that will produce any Toxic or Hazardous Substance, nor cause there
to be stored any Toxic or Hazardous Substance, except for such activities
involving the use of office products and supplies routinely utilized in office
operations ("Permitted Activities"), provided said Permitted Activities are
conducted in accordance with all environmental laws; (ii) Tenant will not
install any underground or aboveground tank of any type on the Property; (iii)
Tenant will not permit any Toxic or Hazardous Substances to be brought onto the
Premises, except in accordance with the terms and conditions hereof and, if so
brought thereon, the same shall be immediately removed and properly disposed and
all required cleanup procedures shall be diligently undertaken pursuant to all
environmental laws; and (iv) Tenant shall in all regards comply with
environmental laws. Prior to any Toxic and Hazardous Substance being brought
upon or into the Premises, whether Landlord's written permission is required or
not, Tenant will provide to Landlord any applicable material safety data sheets
regarding said Toxic or Hazardous Substance as well as a written description of
the amount of such Toxic or Hazardous Substance to be brought upon or into the
Premises and the common and recognized chemical name of such Toxic or Hazardous
Substance. Tenant shall bear responsibility for insuring that all
record-keeping, reporting and remediation responsibilities of Tenant under
applicable environmental laws are met, and Tenant assumes all such
responsibility and liability for such legal compliance. Landlord or Landlord's
representative shall have the right, but not the obligation, to enter the
Premises for, among other purposes, the purposes of inspecting the storage, use
and disposal of any Hazardous Substances and to review compliance with all
environmental laws. Should it be determined, in Landlord's reasonable but sole
discretion, that any Toxic or Hazardous Substances are being improperly stored,
used or disposed of by Tenant, then Tenant shall immediately take such
corrective action as required by applicable environmental laws. Tenant will
provide Landlord written notification of the release or disposal of any Toxic or
Hazardous Substance either within the Premises or outside of Tenant's Premises
and will also provide Landlord written notice of any pending or threatened
litigation concerning the breach or purported breach of any environmental laws
with respect thereto. If, at any time during or after the term of the Lease, the
Premises are found to be contaminated by Toxic or Hazardous Substances as a
result of Tenant's negligence, in whole or in part, or the use of the Premises
or any Toxic or Hazardous Substances by Tenant or any of Tenant's agents or
employees, assigns or subtenants, Tenant shall diligently institute proper and
thorough cleanup procedures in accordance with environmental laws at Tenant's
sole cost, and Tenant agrees to indemnify and hold Landlord harmless from all
claims, demands, actions, liabilities, costs, expenses, damages, fines,
reimbursement, restitution, response costs, cleanup costs, and obligations
(including investigative responses and attorney's fees) so caused during
Tenant's occupancy of the Premises. The foregoing indemnification and the

                                       15
<PAGE>

responsibilities of Tenant shall apply to Tenant regardless of whether they
arise from any Permitted Activity or from any Toxic or Hazardous Substances, the
use of which Landlord approved, and shall survive the termination or expiration
of this Lease. Landlord shall be under no obligation to expend any sums or to
seek reimbursement to enforce the indemnification obligations of Tenant
hereunder.

         32.c. Landlord represents that the Property and its existing uses, and
to the best of Landlord's knowledge after due investigation, its prior uses,
comply with and Landlord is not in violation of, and has not violated, in
connection with the ownership, use, maintenance or operation of the Property and
the conduct of the business related thereto, any applicable federal, state,
county, regional or local statutes, laws regulations, rules, ordinances, codes,
standards, orders, licenses and permits of any governmental authorities relating
to environmental, health or safety matters (including, without limitation, Toxic
or Hazardous Materials, as defined in Subsection 32.a. above) collectively
"Environmental Laws". Landlord shall, at its own expense, promptly observe and
comply with all present and future Environmental Laws, including without
limitation, the Clean Air Act Amendments of 1990 and any regulations (as
amended) and all regulations or standard as are or may be promulgated
thereunder. Without limiting the generality of the foregoing, Landlord
represents that Landlord, its agents, contractors and employees (1) have
operated the Property and have at all times received, handled, used, stored,
treated, transported and disposed of any and all Toxic or Hazardous Materials in
strict compliance with all Environmental Laws, and (ii) have removed (or will
remove prior to the Commencement Date) from the Property all Toxic or Hazardous
Materials. Landlord represents that there is no fact pertaining to the physical
condition of the Property which (i) materially and adversely affects or
materially and adversely will affect the Property, or the use enjoyment or value
thereof, or Landlord's ability to perform the obligations contained in this
Lease, and (ii) which Landlord has not disclosed to Tenant in writing prior to
the date of this Lease. Landlord represents that it has received no notices of
any violation or claimed violation of any of the matters referred to in Section
32 or of any pending or contemplated investigation, lawsuit or other action
relating thereto. The representations contained in this Section 32 shall survive
the expiration or earlier termination date of this Lease. Landlord represents
and warrants that, to the best of its knowledge, there are no Toxic or Hazardous
Substances (including but not limited to asbestos) in the Premises or the
Building. Landlord will indemnify and defend Tenant against all claims relating
to the existence or discharge of Toxic or Hazardous Substances within the
Building or on the Premises, except to the extent that Tenant is responsible for
the existence or discharge thereof.

32. GENERAL PROVISIONS.

         (i) PLATS AND RIDERS. Clauses, plats and riders, if any, signed by the
Landlord and the Tenant and endorsed on or affixed to this Lease are a part
hereof.

         (ii) WAIVER. The waiver by either party of any term, covenant or
condition herein contained shall not be deemed a waiver of such term, covenant
or condition on any subsequent breach of the same or any other term, covenant or
condition herein contained. The subsequent acceptance of Rent hereunder by
Landlord shall not be deemed to be a waiver of any preceding breach by Tenant of
any term, covenant or condition of this Lease, other than the failure of the
Tenant to pay the particular rental so accepted, regardless of Landlord's
knowledge of such preceding breach at the time of the acceptance of such Rent.

         (iii) NOTICES. All notices by Landlord to Tenant shall be sent to
Tenant at the Premises, or to such other place as Tenant may from time to time
designate in a notice to Landlord. All notices by Tenant to Landlord shall be
sent to Landlord at the address specified in Article 1, above, or to such other
place as Landlord may from time to time designate in a notice to Tenant. Notices
shall be in writing, sent by hand delivery by the party giving the notice, by a
reputable private carrier or mailed by U.S. Certified Mail, Return Receipt
Requested, postage prepaid. All notices shall be deemed effective upon receipt
or upon refusal to accept delivery.

         (iv) JOINT OBLIGATION. If there is more than one Tenant the obligations
hereunder imposed upon Tenants shall be joint and several.

         (v) MARGINAL HEADINGS. The marginal headings and titles to the Articles
of this Lease are not a part of this Lease and shall have no effect upon the
construction or interpretation of any part hereof.

                                       16
<PAGE>

         (vi) TIME. Time is of the essence of this Lease and each and all of its
provisions in which performance is a factor.

         (vii) SUCCESSORS AND ASSIGNS. The covenants and conditions herein
contained, subject to the provisions as to assignment, apply to and bind the
heirs, successors, executors, administrators and assigns of the parties hereto.

         (viii) RECORDATION. Neither Landlord nor Tenant shall record this Lease
or a short form memorandum hereof without the prior written consent of the other
party.

         (ix) QUIET POSSESSION. Landlord represents that it is the Fee Simple
owner of the Property and has full right and authority to make this Lease. Upon
Tenant paying the Rent reserved hereunder and observing and performing all of
the covenants, conditions and provisions on Tenant's part to be observed and
performed hereunder, Tenant shall have quiet possession of the Premises for the
entire Term hereof, subject to all the provisions of this Lease.

         (x) LATE CHARGES. Tenant hereby acknowledges that late payment by
Tenant to Landlord of Rent or other sums due hereunder will cause Landlord to
incur costs not contemplated by this Lease, the exact amount of which will be
extremely difficult to ascertain. Such costs include, but are not limited to,
processing and accounting charges, and late charges which may be imposed upon
Landlord by terms of any mortgage of trust deed covering the Premises.
Accordingly, if any installment of Rent or of a sum due from Tenant shall not be
received by Landlord or Landlord's designee within ten (10) days after written
notice that said amount is past due, then Tenant shall pay a late charge to
Landlord of five cents ($.05) for each dollar ($1.00) of each installment of
Annual Base Rent that is due, or the maximum amount allowed by law, whichever is
less. The parties hereby agree that such late charges represent a fair and
reasonable estimate of the cost that Landlord will incur by reason of the late
payment by Tenant. Acceptance of such late charges by the Landlord shall in no
event constitute a waiver of Tenant's default with respect to such overdue
amount, nor prevent Landlord from exercising any of the other rights and
remedies granted hereunder.

         (xi) PRIOR AGREEMENTS. This Lease contains all of the agreements of the
parties hereto with respect to any matter covered or mentioned in this Lease,
and no prior agreements or understandings pertaining to any such matters shall
be effective for any purpose. No provision of this Lease may be amended or added
to except by an agreement in writing signed by the parties hereto or their
respective successors in interest. This Lease shall not be effective or binding
on any party until fully executed by both parties hereto.

         (xii) INABILITY TO PERFORM/FORCE MAJEURE. This Lease and the
obligations of the parties hereunder shall not be affected or impaired because
the other party is unable to fulfill any of its obligations hereunder or is
delayed in doing so, if such inability or delay is caused by reason of acts of
God, or any other cause beyond the reasonable control of the party.

         (xiii) ATTORNEY'S FEES. In the event of any action or proceeding
brought by either party against the other under this Lease the prevailing party
shall be entitled to recover all reasonable costs and expenses including the
fees of its attorneys in such action or proceeding in such amount as the court
may adjudge reasonable.

         (xiv) SALE OF PREMISES BY LANDLORD. In the event of any sale of the
Building, Landlord shall be and is hereby entirely freed and relieved of all
liability under any and all of its covenants and obligations contained in or
derived from this Lease arising out of any act, occurrence or omission occurring
after the consummation of such sale; and the purchaser, at such sale or any
subsequent sale of the Premises shall be deemed, without any further agreement
between the parties or their successors in interest or between the parties and
any such purchaser, to have assumed and agreed to carry out any and all of the
covenants and obligation of the Landlord under this Lease.

         (xv) SUBORDINATION, ATTORNMENT. Upon request of Landlord, Tenant will,
in writing, subordinate its rights hereunder to the lien of any first mortgage,
or first deed of trust to any bank, insurance company or other lending
institution, now or hereafter in force against the land and Building of which
the Premises are a part, and upon any buildings hereafter placed upon the land
of which the Premises are a part, and to advances made or hereafter to be made
upon the security thereof, conditioned, however, upon the nondisturbance of
Tenant's use and

                                       17
<PAGE>

possession of the Premises and recognition of all of its rights hereunder so
long as Tenant performs its covenants and obligations under this Lease.

         In the event any proceeding is brought for foreclosure, or in the event
of the exercise of the power of sale under any mortgage or deed of trust made by
Landlord covering the Premises, Tenant shall attorn to the purchaser upon any
such foreclosure or sale and recognize such purchaser as Landlord under this
Lease.

         (xvi) NAME. Tenant shall not use the name of the Building or of the
development in which the Building is situated for any purpose other than as an
address of the business to be conducted by Tenant in the Premises without the
prior written permission of Landlord. In addition, Landlord shall not use
Tenant's name for any purposes other than that as required on the Building
directory, signage or Landlord's files, without prior written permission of
Tenant.

         (xvii) SEPARABILITY. Any provision of this Lease which shall prove to
be invalid, void or illegal shall in no way affect, impair or invalidate any
other provision hereof and such other provision shall remain in full force and
effect.

         (xviii) CUMULATIVE REMEDIES. No remedy or election hereunder shall be
deemed exclusive but shall, wherever possible, be cumulative with all other
remedies at law or in equity.

         (xix) CHOICE OF LAW. This Lease shall be governed by the laws of the
State in which the Premises are located.

         (xx) SIGNS AND AUCTIONS. Tenant shall not place any sign upon the
Property, Building or Premises or conduct any auction thereon without Landlord's
prior written consent. However, Landlord will allow the placement of Tenant
logo/signage on the wall within the Premises and said logo/signage may be
visible from the common hallway or outside the Premises. Landlord, at its sole
cost and expense, shall provide Tenant with building standard signage on the
monument sign located in front of the entrance to Oak Ridge Technical Center I.
Landlord shall not permit a competitor to place its name on the exterior of the
Building facia. Tenant may in addition, place a sign which refers to its trade
name on the exterior of the Building near the main entrance as designated by
Landlord ("Initial Exterior Sign") provided Landlord gives its written approval
prior to installation, such approval not to be unreasonably withheld,
conditioned or delayed. Such sign shall conform to all zoning regulations, and
be properly maintained at Tenant's expense. Tenant shall install the sign, at
its sole cost and expense. If any governmental authority fails to approve the
Initial Exterior Sign, or, if for any other reason, Tenant is prohibited from
installing the Initial Exterior Sign, the Initial Exterior Sign may be modified
by Tenant to the extent necessary to install the sign, subject to Landlord's
reasonable approval. Tenant shall remove all such signage, at Tenant's sole cost
and expense, within thirty days following expiration of this Lease. Tenant shall
be solely responsible for any and all damages caused by the installation and
removal of all signage.

         (xxi) KEYS. Landlord shall furnish Tenant, free of charge, with two (2)
keys for each corridor door entering the Premises, and twenty-five (25) card
keys for access to the building after hours. Any additional keys and/or cardkeys
will be furnished at a charge by Landlord equal to its cost plus fifteen percent
(15%) on an order signed by Tenant or Tenant's authorized representative. All
such keys and cardkeys shall remain the property of Landlord. No additional
locks shall be allowed on any door of the Premises other than those approved by
Landlord. Upon termination of this Lease, Tenant shall surrender to Landlord all
keys and cardkeys to the Premises, and give to Landlord the combination of all
locks for safes, safe cabinets and vault doors, if any, left in the Premises.

         (xxii) GRAPHICS. Landlord shall provide and install all letters or
numerals on the entry door of the Premises. All such letters and numerals shall
be in the Building's standard graphics. Only Building standard graphics may be
used in any public area or openings on to public areas.

         (xxiii) LANDLORD'S CONSENT. Wherever Landlord's consent is required,
it shall not be unreasonably withheld unless expressly provided otherwise
herein.

33. SATELLITE ANTENNA. Tenant shall have the right, at its sole cost, expense
and liability, to install and operate a satellite antenna dish and cables
thereto on the roof of the Oak Ridge Technical Center One Building at no

                                       18
<PAGE>

additional charge. The satellite dish shall be approximately 30" in diameter and
shall be mounted in a non-penetrating manner under Landlord's supervision.
Tenant shall be totally responsible for the costs associated with the
installation, all maintenance required, and removal of the satellite dish.
Tenant will be responsible for any and all repairs caused by damage to the roof
from such installation.

34. SECURITY CAMERAS. Tenant shall have the right to erect a pole(s) similar to
the pole currently installed at Oak Ridge Technical Center IV (1009 Commerce
park Drive) for the purpose of mounting and testing its security cameras. Tenant
shall bear all costs associated with the installation, maintenance and removal
of the pole(s) including, but not limited to, damage done to the property, such
as irrigation or landscape repair. Tenant shall coordinate with Cowperwood
Maintenance a suitable location for such installation. Internet Pictures
Corporation (IPIX) employees shall have access to the pole and cameras 24 hours
a day, 7 days a week in order to properly test their equipment.

35. NON-DISTURBANCE. Tenant, at no cost to Tenant, shall receive a
subordination, non-disturbance and attornment agreement from present or future
mortgage holders or holders of other superior interest, if any. A copy of the
subordination, non-disturbance and attornment agreement that Landlord's lender
will agree to sign shall be provided to Tenant prior to lease execution.4

36. BROKERS. Each party represents to the other that (i) it has not dealt with
any broker, agent or other intermediary who is or may be entitled to be paid a
broker commission or finder's fee in connection with this Lease, except for N/A
('Landlord's Broker") and Holrob Commercial Realty, LLC in cooperation with
Trammell Crow Services, Inc. ("Tenant's Broker"); and (ii) there are no claims
for brokerage commissions or finder's fees in connection with this Lease, except
as to Landlord's Broker and Tenant's Broker. Landlord acknowledges that any
commission or finder's fee due to the Landlord's Broker and the Tenant's Broker
in connection with this Lease shall be the sole obligation of Landlord. Each
party agrees to indemnify the other and hold it harmless from all liabilities
arising from breach of the representations stated above. The representations and
obligations contained in this Article 34 shall survive the termination of this
Lease.

38. RIGHT OF FIRST REFUSAL. Tenant shall have the right of first refusal to
lease any and all rentable area in the Building (the "Option Space"). Prior to
entering into a lease of the Option Space, Landlord shall give Tenant written
notice of all the terms and conditions of a bona fide third party offer
("Offered Terms") Landlord has received for all or any portion of the Option
Space from a tenant acceptable to Landlord. Tenant may exercise such right only
as to all of the Option Space designated in the Landlord's notice and (except as
set forth below) all of the Offered Terms, and not to merely a part of such
Option Space or a part of such Offered Terms. Tenant shall have ten (10)
business days in which to provide Landlord with written notice of its election
to exercise such right. If Tenant does not give Landlord written notice of its
election to lease such Option Space within the ten (10) business day period,
Landlord shall thereafter be free, for a period of one hundred eighty (180)
days, to lease such Option Space to the bona fide third party on the Offered
Terms. Except as herein set forth, Tenant's rights of first refusal shall
continue in full force and effect as to any and all Option Space.
Notwithstanding the foregoing, (x) if the Offered Terms are for a Lease Term not
co-terminous with the expiration date of the Lease, Tenant's right of first
refusal shall be for a term co-terminous with the Lease (and in that event the
concession package set forth in the bona fide third party offer shall be
increased or decreased pro rata based on the extent to which the Offered Terms
provide for a term that exceeds or precedes the expiration date of the then
current Lease Term, and (y) in no event shall Tenant be obligated to post any
security deposit, whether or not any such deposit is part of the Offered Terms.

39. LEASE ADDENDUMS, AMENDMENTS, EXHIBITS. The following documents are attached
hereto and made a part of this Lease:

         Addendum A - Improvement of Premises
         Addendum B - Rules and Regulations
         Addendum C - Janitorial Specifications
         Exhibit A - Final Floor Plan
         Exhibit B - Final Reflected Ceiling Plan
         Exhibit C - Final Tenant Improvements General Specifications
         Exhibit D - Legal Description of Land

                                       19
<PAGE>

         Exhibit E - Specifications for HVAC Service

The parties hereto have executed this Lease at the place and on the dates
specified immediately adjacent to their respective signatures.

LANDLORD: OAK RIDGE TECHNICAL CENTER PARTNERS, ONE L.P.

ADDRESS: C/O COWPERWOOD COMPANY                 BY:    /s/ Jacquelin Schlather
         -----------------------------------           -------------------------
         245 COMMERCE GREEN BLVD., SUITE 140    TITLE: Sr. V.P. - Cowperwood Co.
         -----------------------------------           -------------------------
         SUGAR LAND, TEXAS 77478                DATE:
         -----------------------------------           -------------------------

TENANT: IPIX CORPORATION

ADDRESS:                                        BY:    /s/ Clara M. Conti
         -----------------------------------           -------------------------
                                                TITLE:  CEO
         -----------------------------------           -------------------------
                                                DATE:   1-28-05
         -----------------------------------           -------------------------

                                       20
<PAGE>

                           LEASE AGREEMENT -ADDENDUM A
                             IMPROVEMENT OF PREMISES

To Lease dated December 15, 2004 between Landlord: Oak Ridge Technical Center
Partners-One, LP, & Tenant: IPIX Corporation.

1. Landlord shall furnish and install within the Premises the tenant
improvements described in the attached Exhibits A, B and C. Landlord will
provide Tenant with a turnkey build-out of the Premises in accordance with the
Final Floor Plan attached hereto as Exhibit A, the Final Reflected Ceiling Plan
attached hereto as Exhibit B and the Final Tenant Improvements General
Specifications attached hereto as Exhibit C.

2. All work not within the scope of the normal construction trades employed on
the Building shall be installed by the Tenant or at Tenant's expense. Tenant
shall adopt a schedule in conformance with the schedule of Landlord's contractor
and conduct its work in such a manner as to maintain harmonious labor relations
and not as to unreasonably interfere with or delay the work of Landlord's
contractor. All said work and labor to be performed by Tenant shall be subject
to the administrative supervision of the Landlord's general contractor (but at
no expense to Tenant for such administrative service.)

3. Landlord shall give to Tenant and Tenant's contractors and subcontractors
access and entry to the Premises, reasonable use of the Building facilities
(including loading platforms, lifts, temporary power, facilities for storage and
protection of materials and all other facilities available to subcontractors of
Landlord's general contractor to the same extent and upon the same terms and
conditions as such facilities are available for the use of subcontractors of the
Landlord's general contractor) in order to allow the Tenant to adapt the
Premises for Tenant's use.

4. Landlord and Tenant agree the first $642,060.00 in aggregate costs (including
Landlord's markup of 10% for overhead and profit) shall be borne solely by
Landlord. Should the aggregate costs (including Landlord's markup of 10% for
overhead and profit) exceed $642,060.00, then Tenant shall have the option to
either (a) pay the excess amount within thirty (30) days of receiving an invoice
for the excess amount (along with a detailed statement showing the breakdown of
the excess amount) or (b) amortize the excess amount, in which case, the excess
amount shall be charged solely to Tenant in equal monthly amounts, amortized
over the five-year lease term at a 6.5% interest rate. If the excess amount is
amortized over the five-year lease term, then the excess amount shall be
included as part of the Tenant Improvement Costs cost for purposes of
determining the early termination fee set forth in Article 3.e.

5. Tenant shall in no event be allowed to install plumbing, mechanical work, or
electrical wiring or fixtures without the prior written approval of Landlord.

6. Tenant agrees that in the event Tenant or its agents cause any delay in
Landlord's completion of the Premises, thereby delaying Tenant's occupancy of
the Premises beyond the Commencement Date of this Lease as set forth herein,
then the Landlord may at its option require the Tenant to commence payment of
rental on the stated Commencement Date as specified herein in Section 3 of the
Lease hereto (or, if later, the date the work would have been substantially
completed, but for Tenant's delay).

7. Should Tenant exercise its OPTION TO RENEW, upon renewal, Tenant shall
receive a Tenant Improvement Allowance (TI Allowance) equal to the same TI
Allowance given to new tenants that have recently leased second generation space
in Commerce Park, Oak Ridge, TN. In no event will the TI Allowance be less than
$4.00 per rentable square foot.

                                       21

<PAGE>

                          LEASE AGREEMENT - ADDENDUM B
                              RULES AND REGULATIONS

1. No sign, placard, picture, advertisement, name or notice shall be inscribed,
displayed or printed or affixed on or to any part of the outside or inside of
the Building without the written consent of Landlord first had and obtained and
Landlord shall have the right to remove any such sign, placard, picture,
advertisement, name or notice without notice to and at the expense of Tenant.

    All approved signs or lettering on doors shall be printed, painted, affixed
or inscribed at the expense of Tenant by the Landlord.

    Tenant shall not place anything or allow anything to be placed near the
glass of any window, door, partition or wall which may appear unsightly from
outside the Premises; provided, however, that Landlord may furnish and install a
Building standard window covering at all exterior windows. Tenant shall not
without prior written consent of Landlord cause or otherwise sun screen any
window.

2. The sidewalks, halls, passages, exits, entrances, elevators and stairways
shall not be obstructed by any of the tenants or used by them for any purpose
other than for ingress and egress from their respective Premises.

3. Tenant shall not alter any lock or install any new or additional locks or any
bolts on any doors or windows of the Premises without first getting Landlord's
permission, which shall not unreasonably be withheld.

4. The toilet rooms, urinals, wash bowls and other apparatus shall not be used
for any purpose other than that for which they were constructed and no foreign
substance of any kind whatsoever shall be thrown therein and the expense of any
breakage, stoppage or damage resulting from the violation of this rule shall be
borne by the Tenant who, or whose employees or invitees shall have caused it.

5. Tenant shall not overload the floor of the Premises or in any way deface the
Premises or any part thereof.

6. No furniture, freight or equipment of any kind, other than occasional
deliveries, shall be brought into the Building without the prior notice to
Landlord and all moving of the same into or out of the Building shall be done at
such time and in such manner as Landlord shall designate. Landlord shall have
the right to prescribe the weight, size and position of all safes and other
heavy equipment brought into the Building and also the times and manner of
moving the same in and out of the Building. Safes or other heavy objects shall,
if considered necessary by Landlord, stand on supports of such thickness as is
necessary to properly distribute the weight. Landlord will not be responsible
for loss of or damage to any such safe or property from any cause and all damage
done to the Building by moving or maintaining any such safe or other property
shall be repaired at the expense of Tenant.

7. Tenant shall not use, keep or permit to be used or kept any foul or noxious
gas or substance in the Premises, or permit or suffer the Premises to be
occupied or used in a manner offensive or objectionable to the Landlord or other
occupants of the Building by reason of noise, odors and/or vibrations, or
interfere in any way with other tenants or those having business therein, nor
shall any animals or birds be brought in or kept in or about the Premises or the
Building.

8. No cooking, other than that done in a microwave, shall be done or permitted
by any Tenant on the Premises, nor shall the Premises be used for the storage of
merchandise, for washing clothes, for lodging, or for any improper,
objectionable or immoral purposes.

9. Tenant shall not use or keep in the Premises or the Building any kerosene,
gasoline or inflammable or combustible fluid or material, or use any method of
heating or air conditioning other than that supplied by Landlord.

10. Landlord will direct electricians as to where and how telephone and
telegraph wires are to be introduced. No boring or cutting for wires will be
allowed without the consent of the Landlord, which consent shall not be
unreasonably withheld. The location of telephones, call boxes and other office
equipment affixed to the Premises shall be subject to the approval of Landlord.

                                       22
<PAGE>

11. In case of invasion, mob, riot, public excitement, or other commotion, the
Landlord reserves the right to prevent access to the Building during the
continuance of the same by closing of the doors or otherwise, for the safety of
the tenants and protection of property in the Building and the Building.

12. Landlord reserves the right to exclude or expel from the Building any person
who, in the judgement of Landlord, is intoxicated or under the influence of
liquor or drugs, or shall in any manner do or act in violation of any rules or
regulations of the Building.

13. Tenant may maintain vending machines in Tenant's Premises for the exclusive
use of Tenant's employees. Such equipment will be the sole responsibility of
Tenant.

14. Landlord shall have the right, given reasonable notice and without liability
to Tenant, to change the name and street address of the Building of which the
Premises are a part, except as otherwise provided herein.

15. Tenant shall not disturb, solicit, or canvass any occupant of the Building
and shall cooperate to prevent the same.

16. Without the written consent of Landlord, Tenant shall not use the name of
the Building in connection with or in promoting or advertising the business of
Tenant except as Tenant's address.

17. Landlord shall have the right to control and operate the public portions of
the Building, and the public facilities, and heating and air conditioning, as
well as facilities furnished for the common use of the tenants, in such manner
as it deems best for the benefit of the tenants generally.

18. All entrance doors in the Premises shall be left locked when the Premises
are not in use, and all doors opening to public corridors shall be kept closed
except for normal ingress and egress from the Premises.

19. Tenant agrees that it shall not without Landlord's prior written consent
permit any person, firm or corporation to perform any cleaning, maintenance or
related services in the Premises other than the person, firm or corporation
authorized by the Landlord to perform such services in the Building.

20. Tenant shall be allowed to install and maintain its own security system for
the Premises, which may include establishing limited access to areas within the
Premises that are reasonably acceptable to Landlord. At its sole option, Tenant
may remove any security, telephone, or computer system or any portion thereof
(the "Systems") installed on behalf of Tenant, provided that Tenant repairs any
damage caused by such removal and restores the affected portion of the Premises
to a usable condition, reasonable wear and tear excepted. In no event, however,
shall Tenant be required to remove any portion of the Systems, (including
without limitation, any cabling) installed in any floor, wall, partition,
ceiling or under any floor covering, though if Tenant removes any portion it
must remove it all.

                                       23

<PAGE>

                          LEASE AGREEMENT - ADDENDUM C
                            JANITORIAL SPECIFICATIONS

AREAS SERVICED:  All office space, restrooms, and public areas.

FREQUENCY:       General cleaning on a five (5) night per week basis. Other work
                 will be performed on a weekly, monthly, quarterly and yearly
                 schedule.

NIGHTLY SERVICES: OFFICES

                 1. Empty waste receptacles.
                 2. Horizontal dusting of office furniture no higher than 5
                    feet.
                 3. Remove film, smudges, stains and markings removable with a
                    mild detergent from top of office furniture.
                 4. Wash main entrance door glass to suites to remove
                    fingerprints, smudges, and outside splashing.
                 5. Clean and return main entrance mats to proper locations.
                 6. Dust mop, and damp mop if necessary, all hard surfaces.
                 7. Wipe clean telephones.
                 8. Vacuum all carpeted surfaces.

                 RESTROOMS

                 1. Empty waste receptacles.
                 2. Fill toilet tissue, hand soap and towel dispensers.
                 3. Fill sanitary napkin dispensers at customer's request.
                 4. Clean all mirrors, bright metal work, fixtures, towel, paper
                    and sanitary napkin dispensers.
                 5. Spot remove fingerprints, smudges and all marks from
                    partitions and doors, removable by a mild detergent.
                 6. Dust tops of restroom stalls.
                 7. Wash and disinfect all basins, bowls, and urinals.
                 8. Sweep and mop all restroom floors.

                 PUBLIC AREAS

                 1. Vacuum corridors.
                 2. Dust mop and buff lobbies.
                 3. Clean elevators (if any) including tracks.
                 4. Empty debris from sand urns, smooth sand and replace when
                    necessary.
                 5. Wash clean all water coolers and fountains.
                 6. Police immediate area of outside lobby entrance.
                 7. Dust mop, damp mop and buff main lobby entrance.
                 8. Clean entrance doors to main lobby and immediate glass
                    panels on each side of doors from top to bottom.
                 9. Keep all lobbies and corridors free of cobwebs.
                 10. Keep wall in main lobby dusted and free of fingerprints,
                     smudges and all marks.

                                       24
<PAGE>

WEEKLY SERVICES:  OFFICES

                  1. All vertical dusting of office furniture.
                  2. Low dusting of furniture legs, baseboards, and top of
                     office furniture beyond 5 feet.
                  3. High dusting of picture frames and top of office furniture
                     beyond 5 feet.
                  4. Brush all fabric chairs.
                  5. Spot remove stains on carpet using the bonnet system.
                  6. Buff hard surface floors.
                  7. Polish desk tops at tenant's request (tenant must
                     remove all papers and articles from the desk top.

                  PUBLIC AREAS

                  1. Spot remove stains on the carpet using the bonnet system.
                  2. Keep lobby walls dusted and free of fingerprints, smudges,
                     and all marks removable by a mild detergent.
                  3. Keep corridor walls free of cobwebs.

MONTHLY SERVICE:  PUBLIC AREAS

                  1. Wax terrazzo floor on main lobby.
                  2. Wax any hard surface floors in all lobbies.
                  3. Wash down glass along corridors.
                  4. Wash down and remove marks from all corridor doors.

QUARTERLY SERVICE: RESTROOMS

                  1. Scrub floors.
                  2. Wash down ceramic and vinyl walls from ceiling to floor.

                  PUBLIC AREAS

                  1. Shampoo all carpets in corridors using the bonnet system.
                  2. Wipe down light fixtures in corridors.

                  OFFICES

                  1. Dust blinds.
                  2. High dusting of air vents.

ANNUAL SERVICE:

                  LOBBY FLOORS

                  Completely strip and re-wax first floor lobby &
                  elevator lobby terrazzo floor.

                  WINDOWS

                  Clean exterior and interior windows.

                                       25
<PAGE>

                           LEASE AGREEMENT - EXHIBIT A
                                FINAL FLOOR PLAN

                                (To Be Attached)

                                       26

<PAGE>

                           LEASE AGREEMENT - EXHIBIT B
                          FINAL REFLECTED CEILING PLAN

                                (To Be Attached)

                                       27
<PAGE>

                           LEASE AGREEMENT - EXHIBIT C
                FINAL TENANT IMPROVEMENTS GENERAL SPECIFICATIONS

DIVISION 1 (General Requirements)-Not used

DIVISION 2 (Site Work)--

      1.  Landlord will install new plants, shrubs, etc. to help enhance the
          landscaping as well as draw attention to Tenant's main entrances.
          Landlord will also plant a hedge between the parking lot for Tech
          Center I and the next building down the hill in order to help hide the
          roof of the adjacent building. Landlord shall provide a plan showing
          landscaping improvements for the Tenant's reasonable approval. For
          planning purposes, Landlord shall coordinate with Tenant's designer.

      2.  Landlord will install two new sections of concrete patio to match the
          existing on the north (or upper side) of the building, adjacent to the
          Employee Entrance These sections shall be approximately 4'-O" x 17'-O"
          and 10'-0" x 17'-O". Joint lines shall align with surrounding existing
          sidewalk sections tenant architect shall direct locations of the two
          sections in the field.

      3.  Landlord shall install a public-style, in-ground, bicycle rack with a
          capacity of approximately 15 bicycles; location to be mutually agreed
          upon by Landlord and Tenant's designer.

DIVISION 3 (Concrete) --

      1.  Refer to Item 2, Division 2 above.

DIVISION 4 (Masonry) -- Not used

DIVISION 5 (Metals) -- Not used

DIVISION 6 (Wood & Plastics)--

     1.  Wood base, nominal 3/4" x 4" with eased edges and beveled at door
         frames, shall be installed in Reception, both Lobbies, Central Corridor
         including Kitchen and Break Room, and Main Conference, Training Room,
         Engineer Conference and Small Conference Room that open off Central
         Corridor.

     2.  Landlord shall provide new millwork based on the Floor Plan in the
         Kitchen (bar area) and a base cabinet with drawers arid countertop,
         approximately 4'-O" wide in Shipping. New millwork shall be plastic
         laminate with colors selected by Tenant's designer.

     3.  Landlord shall provide new millwork for mail slots as shown on Floor
         Plan.

     4.  Landlord shall provide new millwork for display case as shown on
         Floor Plan.

DIVISION 7 (Thermal & Moisture Protection) --

         Include Sound Attenuation Blanket in walls surrounding the Large and
         Medium Conference Rooms, the three executive offices (Rosmus, Ortiz and
         Cruz), the

                                       28
<PAGE>

          Hardware lest Lab, between the Break Room and adjacent office, and the
          Server Room.

DIVISION 8 (Doors & Windows) --

          1. Door Types are as follows. Types are keyed for each door on the
             Floor Plan (Exhibit A). All doors are to match the existing stock
             in finish and size with any differences noted below Doors may
             be new or retrofitted existing stock as described below but if
             existing shall be free of blemishes, chips, etc. Existing black
             anodized frames are acceptable but shall be free of blemishes,
             chips, etc.

                 Type A:  Door with full-light tempered glass panel; no lock.

                 Type B:  Solid door with 18" wide x door height tempered
                          glass sidelight with 1 metal blind, color to be
                          selected by Tenant with lockset, key side on corridor.

                 Type C:  Solid door, with lockset, key side on corridor, or
                          Training Room or Small Conference as it applies.

                 Type D:  Existing door to remain in place, clean and touch-up
                          as required to make free of blemishes; hardware to
                          match new.

                 Type E:  Solid door with electronic strike for prox/keypad
                          reader by Tenant.

                 Type F:  Solid door with privacy lockset.

                 Type G:  Existing exterior doors to be cleaned, touched up,
                          refitted with weather striping as needed; door to
                          receive electronic strike for Tenant's prox/keypad
                          reader.

                 Type H:  Solid door; no lock.

          2. New door Frames shall match the existing.

          3. Hardware shall be lever, commercial grade, brushed stainless.

          4. Interior glass sidelights are as noted in Item 1, Type B, above and
             on the Floor Plan.

DIVISION 9 (Finishes)--

         Walls shall be painted 5/8" gypsum unless noted otherwise.

         2.  Kitchen/Break area flooring shall be 12" x 12" ceramic tile in
             three colors. Pattern and selections shall be provided by Tenant
             designer. Transition strip between tile and adjacent carpet shall
             be metal strip equal to a Schluter Systems.

         3. Ceilings:

                 A.  Ceilings in open office areas, private offices, labs,
                     storage rooms and restrooms shall be existing 2' x 2'
                     tegular edge acoustic ceiling tile with existing grid with
                     any discolored, chipped, broken or otherwise marred tile or
                     grid either repaired or replaced.

                 B.  Ceilings in the main corridor, break room and kitchen and
                     the conference or training rooms that open off the main
                     corridor shall be a

                                       28

<PAGE>

                      high performance 2' x 2' tegular edge high performance
                      ceiling tile such as USG's Optima or equal with new grid
                      to match existing.

          4.  Carpet shall average $22 / yard installed and shall be used
              everywhere unless otherwise noted in this section. Selections
              shall be made by Tenant's designer.

          5.  Base shall be as follows:

                 A.  Carpet base shall be installed in the common areas and open
                     office areas.

                 B.  4" high vinyl cove base shall be installed in private
                     offices, storage rooms, labs and anywhere not otherwise
                     covered in this section.

                 C.  Refer to Division 6 above.

          6.  Finish flooring in Security Inventory, InfoMedia Inventory,
              Software Test Lab, Software Test Storage, and InfoMedia Storage
              shall be VCT. Finish flooring in Hardware Test Lab and Optics Labs
              shall be anti-static VCT.

          7.  All walls shall be painted with at least two coats of good quality
              interior paint in an eggshell finish unless noted otherwise.

          8.  Walls in the Reception, Large and Medium Conference Rooms shall be
              covered in good quality vinyl wall covering at $10/square yard.

          9.  Walls in the Kitchen shall be covered in vinyl wall covering at
              $7/square yard.

          10. Existing restrooms shall receive new ceramic tile flooring and
              base in no more than two colors, new vinyl wall covering with
              a $7/square yard allowance and new plastic laminate counter
              tops; colors and patterns to be determined by Tenant designer.

          11. Shower room walls and floors shall be ceramic tile throughout
              including a ceramic tile covered bench, 18 high as shown on Floor
              Plan in each room.

          12. Landlord shall paint exterior door frames to match the existing
              color.

 DIVISION 10 (Specialties) --

          1.  Provide and install one foot (1'-0") high access flooring in the
              Server Room.

          2.  Signage shall be as directed by Building Manager.

          3.  Include semi-recessed Fire Extinguisher Cabinets as required by
              code.

 DIVISION 11 (Equipment)

          1.  Landlord shall move and install Tenant's existing kitchen
              appliances and millwork as shown on plans. Any new appliances
              shall be provided by the Tenant.

          2.  Landlord shall move and install Tenant's existing Main Conference
              Room millwork, including the rear projection screen and trim as
              shown on plans.

          3.  Landlord shall move and install Tenant's existing Meco Shades and
              Draperies and associated hardware to locations in the new offices
              as directed by Tenant designer.

          4.  Landlord shall provide two ceiling mounted, automatically
              retractable projection screens in northwestern Conference Room and
              the Engineering Conference Room.

                                       28
<PAGE>

          5.  Landlord shall provide a rear project screen equivalent to the one
              in the Tenant's existing Main Conference Room in the Training
              Room.

 DIVISION 12 (Furnishings) --

          1.  Building standard window treatments are to be provided by
              Landlord.

 DIVISION 13 (Special Construction) -- Not used.

 DIVISION 14 (Conveying Systems)-- Not used.

 DIVISION 15 (Mechanical) --

          1.  HVAC zoning shall be constructed so that the following rooms have
              individual thermostat control each lab, each conference room, and
              the three largest executive offices Other areas shall be
              constructed to meet best practice.

          2.  The Server Room shall be equipped with a dedicated Liebert
              Challenger 3-ton HVAC unit. The model number is BFO42A-CAEI.
              Required options are the Network Interface Card, Dual Float
              Condensate Pump, 12" floor stand and NFORM Liebert monitor
              software (part number: NFORM).

          3.  The Server Room shall be equipped with a Surge Suppressor for the
              Emergency Panel, model number S10016120YANSE.

          4.  The Electric/UPS room shall be equipped with the Landlord's
              existing Liebert DataMate 1-ton HVAC unit.

 DIVISION 16 (Electrical) --

          1.  Each workstation and office shall be equipped with a data port
              with four (4) CAT-Se cables, Cables shall be fed from the ceiling
              plenum through fin walls constructed of steel studs and gypsum
              board strategically placed to feed the systems furniture.
              Locations are shown on Floor Plan.

          2.  Each workstation and office shall be equipped with four (4)
              electrical outlets; with one circuit reserved for computer
              equipment. Electrical lines shall be fed from the ceiling plenum
              through fin walls constructed of steel studs and gypsum board
              strategically placed to feed the systems furniture. Locations are
              shown on Floor Plan.

         3.   Floor slab core drills for power and data will be required below
              the conference tables in the Large and Medium Conference Rooms.
              Locations are shown on Floor Plan.

         4.   Other electrical distribution shall be as required by code and
              best practice. Locations are as shown on Floor Plan.

         5.   Overhead lighting shall be indirect recessed fluorescent
              "bat-wing" style fixtures similar to Lightolier Avanti fixtures.
              Individual bulbs in the same fixture (where feasible) or the
              entire fixtures shall be wired and switched so that only
              one-third, two-thirds or all of the light fixtures can be operated
              in the

                                       28
<PAGE>

              same area Landlord's suggestion that the fixtures be equipped with
              a "controllable" ballast with remote control is acceptable as
              long as it meets the intention of giving the occupants control
              over light levels.

         6.   Incandescent recessed light fixtures shall be provided as shown on
              Reflected Ceiling Plan.

         7.   No more than five duplex outlets shall be installed on any one
              electrical circuit.

         8.   Provide and install a 20k VA UPS for the Server Room. This will be
              a 20k VA Liebert NX UPS (model 38SAO2OCOCFJ).

         9.   Critical Panel in the Server Room shall be 42 pole.

         10.  The Server Room shall be equipped with a Surge Suppressor for the
              Emergency Panel, model number SIOO16I2OYANSE.

         11.  Landlord shall provide specialty lighting as shown on the
              Reflected Ceiling Plan. Landlord has provided a $20,000
              allowance in the Tenant's build-out cost Specialty lighting shall
              be ConTech Lighting's Magellan Series with CRS 129-S heads with
              the CRS-SP 130 Frosted White Glass Ring with Clips or equal. If
              substitution made, Landlord is to review with Tenant's designer.

         12.  Landlord shall provide for additional exterior lighting at the
              Main and Employee's Entrances New lighting is needed to increase
              the foot-candles and is not intended to be decorative, Tenant's
              designer will coordinate with Landlord.

                                       28

<PAGE>

                           LEASE AGREEMENT - EXHIBIT D
                                LAND DESCRIPTION

The land upon which the Building sits, and for which Tenant pays its pro rata
share of any "Operating Expenses" associated with such is hereby defined as:

Tract 10.01 of Commerce Park, Oak Ridge, Tennessee, consisting of 5.34 acres and
further described by the following:

Beginning at an iron pin in the west R.O.W. of Commerce Park Drive east of said
property, being also the southeast corner of Parcel 6.

Thence, S 15 degree 09'16" W 322.47" with said R.O.W. to an iron pin.

Thence, an arc distance of 151.82' with a radius of 741.2' to an iron pin; with
a chord S 9 degree 17'12" W 151.55'.

Thence, S 3 degree 25'13" W 39.36' with said R.O.W. to an iron pin; being also
the northeast corner of Tract 10.01.

Thence, N 85 degree 10'55" W 433.39' to an iron pin; being also the southeast
corner of Tract 10.01.

Thence N 1 degree 51'43" E 481.69' to an iron pin; being also the southeast
corner of Tract 10.01.

Thence S 88 degree 08'24" E 527.63' to point of beginning.

Containing 5.34 acres more or less.

                                       29

<PAGE>

                           LEASE AGREEMENT - EXHIBIT E
                         SPECIFICATIONS FOR HVAC SERVICE

         The Base Building HVAC has the capability to provide a thermal
environment to satisfy the following conditions:

                  Summer: Maintain room conditions not in excess of 76 degrees
                  Fahrenheit dry bulb and 50% relative humidity when the
                  coincident outside conditions do not exceed 95 degrees
                  Fahrenheit dry bulb and 78 degrees Fahrenheit wet bulb.

                  Winter: Maintain room conditions of not less than 70 degrees
                  Fahrenheit dry bulb when the outside temperature is not less
                  than 15 degrees Fahrenheit dry bulb.

                  The above conditions shall be maintained, based upon the
following:

                  (A) Mecho shades or mini blinds fully lowered (mini blind
                      slats at 45(Degree) angle), at peak sun load.

                  (B) Electrical load (combined lighting and equipment) of seven
                      watts per square foot.

                  (C) People load of one person per 150 square feet.

         Base Building design is for outside air of 0.14 cfm per square foot,
which is per code.

                                       30exv10w46

 

Exhibit 10.46

EMPLOYMENT AGREEMENT

     THIS EMPLOYMENT AGREEMENT (this “Agreement”) is by and between Jafra Cosmetics
International, Inc. a Delaware corporation (“the Company”), and Beatriz Gutai, an
individual resident of California (“Employee”).

AGREEMENT

     The parties to this Agreement, intending to be legally bound, agree as follows:

     1. Effective Date. Employee began employment with the Company on 20th
April, 1981. Effective 1st September, 2004, Employee’s employment will be governed by
the terms of this Agreement (the “Effective Date”).

     2. Employment Terms and Duties.

          2.1 Employment. The Company employs Employee, and Employee accepts employment by the
Company (the “Employment”), upon the terms and conditions set forth in this Agreement.

          2.2 At-Will Employment. Employee’s employment relationship with the Company is
at-will, terminable at any time and for any reason with or without notice by either the Company or
Employee. Although certain provisions of this Agreement describe events that could occur at a
particular time in the future, nothing in this Agreement may be construed as a guarantee of
Employee’s employment for any length of time.

          2.3 Duties. As of the Effective Date, Employee will serve as Senior Vice President
Global Marketing & Strategic Planning and will have such duties as are assigned or delegated to
Employee by the Chief Executive Officer (the “CEO”) or the Chief Operating Officer (the
“COO”). Employee will: (i) devote her entire business time, attention, skill, and energy
exclusively to the business of the Company; (ii) use her best efforts to promote the success of the
Company’s business; and (iii) cooperate fully with the CEO, COO and the Board of Directors of the
Company in the advancement of the best interests of the Company. Employee understands and agrees
that as part of her employment, she may from time to time be called upon to serve as consultant to
or may be assigned to related Company entities. The terms and conditions of any assignment will be
set forth in a separate Temporary Assignment Contract. Unless otherwise agreed in writing, during
any temporary assignment, Employee remains employed by the Company.

          2.4 Compliance with the Company’s Policies. Employee acknowledges and agrees that
compliance with the Company’s policies, practices and procedures is a term and condition of the
Employment under this Agreement. Employee agrees to comply with the terms and conditions of the
Company’s Employee Confidentiality and Inventions Agreement, a copy of which is attached to this
Agreement as Exhibit A and is incorporated by this reference.

 

 

          2.5 Place of Employment. Employee will perform her duties at a location defined by
Jafra’s CEO, COO or Board of Directors. Unless temporarily assigned as described above, Employee
will perform her duties at Jafra’s headquarters, currently 2451 Townsgate Road, Westlake Village,
California 91361.

     3. Compensation.

          3.1
Salary. Employee will be paid an annual salary of two hundred fifty Thousand
Dollars ($250,000) (the “Salary”), less any applicable state and federal taxes or other
payroll deductions. The Salary will be payable in equal periodic installments according to the
Company’s customary payroll practices. Any adjustment to the Salary is at the sole discretion of
the Company.

          3.2 Benefits. Employee may participate in such sick leave, pension, profit sharing,
life insurance, hospitalization, long term disability, major medical and other employee benefit
plans of the Company (collectively, the “Benefits”), that may be in effect from time to
time for management level employees, to the extent that Employee is eligible under the terms of
those plans.

          3.3 Additional Compensation. Employee may be eligible, as additional compensation for
the services rendered by Employee pursuant to this Agreement, for a bonus and long term incentive
compensation at the discretion of the CEO, COO or the Board and in an amount to be determined by
the CEO, COO and the Board, in accordance with the Company’s bonus plans and Long Term Incentive
Compensation Plan (the “Additional Compensation”). In order to be eligible for the
Additional Compensation, Employee shall be employed by the Company on the date that the Additional
Compensation, if any, is customarily distributed by the Company.

     4. Expenses. The Company will pay on behalf of Employee (or reimburse Employee)
reasonable expenses incurred by Employee at the request of, or on behalf of, the Company in the
performance of Employee’s duties pursuant to this Agreement, and in accordance with the Company’s
employment policies, including reasonable expenses incurred by Employee (a) while attending
conventions, seminars and other business meetings, (b) for appropriate business entertainment
activities and (c) for appropriate promotional expenses. In order to be eligible for
reimbursement, Employee shall file expense reports with respect to such expenses in accordance with
the Company’s policies, and must secure approval from the CEO or the COO before expenses will be
reimbursed.

     5. Vacations and Holidays. Employee is entitled to vacation and holidays according to
the Company’s vacation policies for management employees. Employee must request and receive
permission from the CEO or COO prior to taking vacation. Every effort will be made to accommodate
an employee’s vacation request if the absence is consistent with the Company’s workload and
business needs.

     6. Payment upon Termination of Employment. Upon termination of Employee’s Employment,
the Company will be obligated to pay to Employee only such compensation as is provided in this
Section 6.

2

 

          6.1 Termination of Employee without Cause. In the event Employee’s employment is
terminated by the Company without Cause as defined in Section 6.2 below, Employee will receive
Salary and accrued but unused vacation through the date of such termination (the “Termination
Date”). In addition, Employee will receive severance in an aggregate amount equal to eighteen
(18) months’ Salary (the “Severance Payment.”) The Severance Payment is the exclusive
severance payment to which Employee is entitled, and include any severance amounts to which
Employee is entitled under any Company severance plan, policy or program. Any payment will be less
applicable state and federal taxes and/or other payroll deductions. The Severance Payment will be
made in a lump sum within forty five (45) days of the Effective Date as defined in Exhibit B.
Further, if Employee elects continued coverage pursuant to the Consolidated Budget Reconciliation
Act (“COBRA”), the Company will pay an amount equal to the previously paid “employer portion” of
Employee’s monthly premium, for continuation of the Employee’s benefits for six (6) months.

          6.2 Termination of Employee with Cause or Resignation by Employee. In the event the
Employment is terminated by the Company for Cause or Employee resigns her employment for any
reason, Employee will receive any earned portion of Salary and accrued but unused vacation through
the Termination Date, less applicable state and federal taxes and/or other payroll deductions.
Termination for “Cause” occurs if Employee is terminated for any one of the following
reasons: (i) Employee’s material breach of this Agreement; (ii) Employee’s material failure to
adhere to any written policy of the Company that is legal and generally applicable to officers of
the Company; (iii) the appropriation (or attempted appropriation) of a material business
opportunity of the Company, including attempting to secure or securing any personal profit in
connection with any transaction entered into on behalf of the Company; (iv) the misappropriation
(or attempted misappropriation) of any of the Company’s funds or property; or (v) the conviction
of, or the entering of a guilty plea or plea of no contest with respect to, a felony, the
equivalent thereof, or any other crime with respect to which imprisonment is a possible punishment.

          6.3 Termination of Employment following Death or Disability. In the event the
Employment is terminated as a result of Employee’s death or as a result of Employee suffering a
disability which cannot be reasonably accommodated and which renders her unable to perform the
essential functions of her position for 120 days, Employee or her heirs are entitled to any earned
portion of Salary and accrued but unused vacation through the Termination Date.

          6.4 Termination for Any Other Reason. In the event that Employee resigns or Employee’s
employment terminates under any circumstance other than that described in Sections 6.1 through 6.3,
Employee will be entitled to receive the portion of the Salary earned and any vacation accrued and
owing to Employee only through the Termination Date.

          6.5 Benefits. Except where specifically provided by this Agreement, Employee’s
accrual of, or participation in plans providing for, the Benefits will cease at the effective date
of Employee’s termination, and Employee will be entitled to accrued Benefits pursuant to such plans
only as provided in such plans.

          6.6 Release in Exchange for Payment. Employee’s receipt of any Severance Payment and
continued Benefits coverage as described in Section 6.1 is conditioned upon

3

 

Employee executing a release of all claims effective as of the Termination Date, in
substantially the form attached to this Agreement as Exhibit B.

     7. General Provisions.

          7.1 Representations and Warranties by Employee. Employee represents and warrants to
the Company that the execution of this Agreement and the performance by Employee of her obligations
under this Agreement will not: (a) violate any judgment, writ, injunction, or order of any court,
arbitrator, or governmental agency applicable to Employee; or (b) conflict with, result in the
breach of any provisions of or the termination of, or constitute a default under, any agreement to
which Employee is a party or by which Employee is or may be bound.

          7.2 Obligations Contingent on Performance. The obligations of the Company hereunder,
including its obligation to pay the compensation provided for herein, are contingent upon
Employee’s performance of Employee’s obligations hereunder.

          7.3 Waiver. The rights and remedies of the parties to this Agreement are cumulative
and not alternative. Neither the failure nor any delay by either party in exercising any right,
power, or privilege under this Agreement will operate as a waiver of such right, power, or
privilege, and no single or partial exercise of any such right, power, or privilege will preclude
any other or further exercise of such right, power, or privilege or the exercise of any other
right, power, or privilege. To the maximum extent permitted by applicable law: (a) no claim or
right arising out of this Agreement can be discharged by one party, in whole or in part, by a
waiver or renunciation of the claim or right unless in writing signed by the other party; (b) no
waiver that may be given by a party will be applicable except in the specific instance for which it
is given; and (c) no notice to or demand on one party will be deemed to be a waiver of any
obligation of such party or of the right of the party giving such notice or demand to take further
action without notice or demand as provided in this Agreement.

          7.4 Binding Effect; Delegation of Duties Prohibited. This Agreement shall inure to
the benefit of, and shall be binding upon, the parties and their respective successors, assigns,
heirs, and legal representatives, including any entity with which the Company may merge or
consolidate or to which all or substantially all of its assets may be transferred. The duties and
covenants of Employee under this Agreement, being personal, may not be delegated.

          7.5 Notices. All notices, consents, waivers, and other communications under this
Agreement must be in writing and will be deemed to have been duly given when (a) delivered by hand
(with written confirmation of receipt), (b) sent by facsimile (with written confirmation of
receipt), provided that a copy is mailed by registered mail, return receipt requested or (c) when
received by the addressee, if sent by a nationally recognized overnight delivery service (receipt
requested), in each case to the appropriate addresses and facsimile numbers set forth below (or to
such other addresses and facsimile numbers as a party may designate by notice to the other
parties):

4

 

	 	 	 	 	 
	 

	 	If to the Company:
	 	Chief Executive Officer
	

	 	 	 	Jafra Cosmetics International, Inc.
	

	 	 	 	2451 Townsgate Road
	

	 	 	 	Westlake Village, California 91361
	 
	 	 	 	 
	

	 	If to Employee:
	 	Home office address on file with the Company

          7.6 Entire Agreement; Amendments. This Agreement, including its exhibits, contains
the entire agreement between the parties with respect to the subject matter of this Agreement and
supersedes all prior agreements and understandings, oral or written, between the parties with
respect to the subject matter of this Agreement.

          7.7 Governing Law. This Agreement will be governed by the laws of California without
regard to conflicts of law principles.

          7.8 Jurisdiction. Any proceeding seeking to enforce any provision of, or based on any
right arising out of, this Agreement will be brought against any of the parties in the courts of
the state in which the defendant in such action or proceeding resides or is domiciled, or, if it
has or can acquire jurisdiction, in the United States District Court for the district of the state
in which such defendant resides or is domiciled, and each of the parties consents to the
jurisdiction of such courts (and of the appropriate appellate courts) in any such action or
proceeding and waives any objection to venue laid therein. Process in any action or proceeding
referred to in the preceding sentence may be served on any party anywhere in the world.

          7.9 No Undue Influence. This Agreement is executed voluntarily and without any duress
or undue influence. Employee acknowledges that he has read this Agreement and executed it with her
full and free consent. No provision of this Agreement shall be construed against any party by
virtue of the fact that such party or its counsel drafted such provision or the entirety of this
Agreement.

          7.10 Section Headings, Construction. The section headings in this Agreement are
provided for convenience only and will not affect its construction or interpretation.

          7.11 Severability. If any provision of this Agreement is held invalid or
unenforceable by any court of competent jurisdiction, the other provisions of this Agreement will
remain in full force and effect. Any provision of this Agreement held invalid or unenforceable only
in part or degree will remain in full force and effect to the extent not held invalid or
unenforceable.

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          7.12 Counterparts. This Agreement may be executed in one or more counterparts, each of
which will be deemed to be an original copy of this Agreement and all of which, when taken
together, will be deemed to constitute one and the same agreement.

	 	 	 	 	 	 	 
	JAFRA COSMETICS	 	 	 	 
	INTERNATIONAL, INC.	 	 	 	 
	 
	 	 	 	 	 	 
	By:
	 	 	 	 	 	 
	

	 	 
	 	 	 	 
	

	 	Chief Executive Officer
	 	 	 	Employee
	 
	 	 	 	 	 	 
	By:
	 	 	 	 	 	 
	

	 	 	 	 	 	 
	

	 	Chief Operating Officer	 	 	 	 

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EXHIBIT A

EMPLOYEE CONFIDENTIALITY AND INVENTIONS AGREEMENT

     The following confirms the agreement between Employee and Jafra Cosmetics International, Inc.,
a Delaware corporation (the “Company”), which is a material part of the consideration for
Employee’s employment by the Company:

          1. Employee understands that the Company possesses and will possess Proprietary Information
which is important to its business. For purposes of this Agreement, “Proprietary Information” is
information that was or will be developed, created, or discovered by or on behalf of the Company,
or which became or will become known by, or was or is conveyed to the Company, which has commercial
value in the Company’s business. “Proprietary Information” includes, but is not limited
to, information about trade secrets, computer programs, designs, technology, ideas, know-how,
processes, compositions, data, techniques, improvements, inventions (whether patentable or not),
works of authorship, business and product development plans, the salaries and terms of compensation
of other employees, customers and other information concerning the Company’s actual or anticipated
business, research or development, or which is received in confidence by or for the Company from
any other person. Employee understands that Employee’s employment creates a relationship of
confidence and trust between Employee and the Company with respect to Proprietary Information.

          2. Employee understands that the Company possesses or will possess “Company Materials” which
are important to its business. For purposes of this Agreement, “Company Materials” are
documents or other media or tangible items that contain or embody Proprietary Information or any
other information concerning the business, operations or future/strategic plans of the Company,
whether such documents have been prepared by Employee or by others including but not limited to
portions of the Company’s customer lists which have been specially compiled by the Company to
include information not available to the public such as customer preferences and customer buying
history. “Company Materials” also include, but are not limited to, blueprints, drawings,
photographs, charts, graphs, notebooks, customer lists, computer disks, tapes or printouts, sound
recordings and other printed, typewritten or handwritten documents.

          3. In consideration of Employee’s employment by the Company and the compensation received by
Employee from the Company Employee hereby agrees as follows:

               a. All Proprietary Information and trade secret rights, and other intellectual property and
rights (collectively “Rights”) in connection therewith will be the sole property of the
Company. At all times, both during Employee’s employment by the Company and after its termination,
Employee will keep in confidence and trust and will not use or disclose any Proprietary Information
or anything relating to it without the prior written consent of an officer of the Company except as
may be necessary and appropriate in the ordinary course of performing Employee’s duties to the
Company.

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               b. All Company Materials will be the sole property of the Company. Employee agrees that during
Employee’s employment by the Company, Employee will not remove any Company Materials from the
business premises of the Company or deliver any Company Materials to any person or entity outside
the Company, except as Employee is required to do in connection with performing the duties of
Employee’s employment. Employee further agrees that, immediately upon the termination of Employee’s
employment by Employee or by the Company for any reason, or during Employee’s employment if so
requested by the Company, Employee will return all Company Materials, apparatus, equipment and
other physical property, or any reproduction of such property, excepting only (i) Employee’s
personal copies of records relating to Employee’s compensation; (ii) Employee’s personal copies of
any materials previously distributed generally to stockholders of the Company; and (iii) Employee’s
copy of this Agreement.

               c. During the term of Employee’s employment and for two years thereafter, Employee will not
encourage or solicit any employee or consultant of the Company to leave the Company for any reason.
However, this obligation will not affect any responsibility Employee may have as an employee of
the Company with respect to the bona fide hiring and firing of Company personnel.

               d. Employee promptly will disclose in writing to Employee’s immediate supervisor, with a copy
to the President of the Company, or to any persons designated by the Company, all
“Inventions”, which includes all improvements, inventions, designs, formulas, works of
authorship, trade secrets, technology, computer programs, compositions, ideas, processes,
techniques, know-how and data, whether or not patentable, made or conceived or reduced to practice
or developed by me, either alone or jointly with others, during the term of Employee’s employment.
Employee also will disclose to the President of the Company all things that would be Inventions if
made during the term of Employee’s employment, conceived, reduced to practice, or developed by
Employee within six months after the termination of Employee’s employment with the Company. Such
disclosures will be received by the Company in confidence (to the extent they are not assigned in
Section 3(f) below) and do not extend the assignment made in Section 3 (f) below.
Employee will not disclose Inventions to any person outside the Company unless Employee is
requested to do so by management personnel of the Company.

               e. Employee agrees that all Inventions which Employee makes, conceives, reduces to practice or
develop (in whole or in part, either alone or jointly with others) during Employee’s employment
will be the sole property of the Company to the maximum extent permitted by Section 2870 of the
California Labor Code, a copy of which is attached and hereby assign such Inventions and all Rights
therein to the Company. No assignment in this Agreement will extend to inventions, the assignment
of which is prohibited by Labor Code Section 2870 (attached Exhibit 1). The Company will
be the sole owner of all Rights in connection therewith.

               f. Employee agrees to perform, during and after Employee’s employment, all acts deemed
necessary or desirable by the Company to permit and assist it, at the Company’s expense, in
obtaining, maintaining, defending and enforcing Rights with respect to such Inventions and
improvements in any and all countries. Such acts may include, but are

8

 

not limited to, execution of documents and assistance or cooperation in legal proceedings.
Employee irrevocably designates and appoints the Company and its duly authorized officers and
agents, as Employee’s agents and attorneys-in-fact to act for and in Employee’s behalf and instead
of Employee, to execute and file any documents and to do all other lawfully permitted acts to
further the above purposes with the same legal force and effect as if executed by Employee.

               g. Any assignment of copyright pursuant to this Agreement includes all rights of paternity,
integrity, disclosure and withdrawal and any other rights that may be known as or referred to as
“moral rights” (collectively “Moral Rights”). To the extent such Moral Rights cannot be
assigned under applicable law and to the extent the following is allowed by the laws in the various
countries where Moral Rights exist, Employee waives such Moral Rights and consent to any action of
the Company that would violate such Moral Rights in the absence of such consent. Employee will
confirm any such waivers and consents from time to time as requested by the Company.

               h. Employee has attached to this Agreement as Exhibit 2 a complete list of all
existing Inventions or improvements to which Employee claims ownership as of the date of this
Agreement and that Employee desires to specifically clarify are not subject to this Agreement, and
Employee acknowledges and agrees that such list is complete. If no such list is attached to this
Agreement, Employee represents that he has no such Inventions and improvements at the time of
signing this Agreement. ___[INITIAL HERE]

               i. Employee agrees that during Employee’s employment with the Company Employee will not engage
in any employment, business, or activity that is in any way competitive with the business or
proposed business of the Company, and Employee will not assist any other person or organization in
competing with the Company or in preparing to engage in competition with the business or proposed
business of the Company. The provisions of this paragraph will apply both during normal working
hours and at all other times including, but not limited to, nights, weekends and vacation time,
while Employee is employed by the Company.

               j. Employee represents that Employee’s performance of all the terms of this Agreement will not
breach any agreement to keep in confidence proprietary information acquired by Employee in
confidence or in trust prior to Employee’s employment by the Company. Employee has not entered
into, and Employee agrees he will not enter into, any agreement either written or oral in conflict
with this Agreement or in conflict with Employee’s employment with the Company.

          4. Employee agrees that this Agreement is not an employment contract and that Employee has the
right to resign and the Company has the right to terminate Employee’s employment at any time, for
any reason, with or without cause.

          5. Employee agrees that this Agreement does not purport to set forth all of the terms and
conditions of Employee’s employment, and that as an employee of the Company Employee has
obligations to the Company which are not set forth in this Agreement.

9

 

          6. Employee agrees that Employee’s obligations under sections 3(a) through
3(f) and section 3(h) of this Agreement will continue in effect after termination
of Employee’s employment, regardless of the reason or reasons for termination, and whether such
termination is voluntary or involuntary on Employee’s part, and that Employee will notify any
future client, employer or potential employer or client of Employee’s obligations under this
Agreement. Employee agrees that the Company is entitled to communicate Employee’s obligations under
this Agreement to any future employer or potential employer.

          7. Employee acknowledges and agrees he has an obligation to protect the Company’s Propriety
Information and Company Materials and that this obligation continues in effect after termination of
Employee’s employment, regardless of the reason or reasons for termination, and whether such
termination is voluntary or involuntary on Employee’s part. Therefore, Employee agrees that he
will not disclose these Propriety Information and Company Materials to assist any other person or
organization in competing with the Company or in preparing to engage in competition with the
business or proposed business of the Company.

          8. Employee agrees that the Company has expended substantial efforts to maintain the
confidentiality and proprietary nature of the information described in this Agreement and would be
materially and irreparably injured by an unauthorized disclosure of any of that information. Any
breach of this Agreement will result in irreparable and continuing damage to the Company for which
there can be no adequate remedy at law, and in the event of any such breach, the Company will be
entitled to immediate injunctive relief and other equitable remedies (without any need to post any
bond or other security) in addition to such other and further relief as may be proper.

          9. Employee agrees that any dispute in the meaning, effect or validity of this Agreement will
be resolved in accordance with the laws of California without regard to the conflict of laws
provisions to this Agreement. Employee further agrees that if one or more provisions of this
Agreement are held to be illegal or unenforceable under applicable California law, such illegal or
unenforceable portion(s) will be revised to make them legal and enforceable. The remainder of this
Agreement will otherwise remain in full force and effect and enforceable in accordance with its
terms.

          10. This Agreement will be effective as of the date Employee executes this Agreement and will
be binding upon me, Employee’s heirs, executors, assigns, and administrators and will inure to the
benefit of the Company, its subsidiaries, successors and assigns.

10

 

          11. This Agreement only can be modified by a subsequent written agreement executed by the
President of the Company.

I HAVE READ THIS AGREEMENT CAREFULLY AND UNDERSTAND AND ACCEPT THE OBLIGATIONS WHICH IT IMPOSES
UPON ME WITHOUT RESERVATION. NO PROMISES OR REPRESENTATIONS HAVE BEEN MADE TO ME TO INDUCE ME TO
SIGN THIS AGREEMENT. I SIGN THIS AGREEMENT VOLUNTARILY AND FREELY, IN DUPLICATE, WITH THE
UNDERSTANDING THAT ONE COUNTERPART WILL BE RETAINED BY THE COMPANY AND THE OTHER COUNTERPART WILL
BE RETAINED BY ME.

	 	 	 	 	 
	Dated: ___, 200_

	 	

	 	 
	

	 	Employee	 	 

11

 

EXHIBIT 1

     Section 2870. Application of provision providing that employee will assign or offer to assign
rights in invention to employer.

     (a) Any provision in an employment agreement which provides that an employee will assign, or
offer to assign, any of his or her rights in an invention to his or her employer will not apply to
an invention that the employee developed entirely on his or her own time without using the
employer’s equipment, supplies, facilities, or trade secret information except for these inventions
that either:

          (1) Relate at the time of conception or reduction to practice of the invention to the
employer’s business, or actual or demonstrably anticipated research or development of the employer,
or

          (2) Result from any work performed by the employee for the employer.

     (b) To the extent a provision in an employment agreement purports to require an employee to
assign an invention otherwise excluded from being required to be assigned under subdivision (a),
the provision is against the public policy of this state and is unenforceable.

12

 

EXHIBIT 2

Jafra Cosmetics International, Inc.

Address

To Whom It May Concern::

     1. The following is a complete list of inventions or improvements relevant to the subject
matter of my employment by Jafra Cosmetics International, Inc. (the “Company”) that have been made
or conceived or first reduced to practice by me alone or jointly with others prior to my employment
by the Company that I desire to clarify are not subject to the Company’s Proprietary Information
and Inventions Agreement.

                     No inventions or improvements

                     See below:

                     Additional sheets attached

     2. I propose to bring to my employment the following materials and documents of a former
employer:

                     No materials or documents

                     See below:

                                                            

     Employee

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