Document:

<PAGE>

                                                                   EXHIBIT 10.50

                              AMENDMENT NO. 3 TO
                             EMPLOYMENT AGREEMENT
                             --------------------

     This is an Amendment, dated April 24, 2001 (the "Amendment") to the
Employment Agreement made as of the 1st day of March, 2000 by and between SELECT
MEDICAL CORPORATION, a Delaware corporation (the "Employer"), and ROCCO A.
ORTENZIO, an individual (the "Employee").

                                  Background
                                  ----------

     A.   The Employer and the Employee executed and delivered that certain
Employment Agreement dated as of March 1, 2000, that certain Amendment No. 1 to
Employment Agreement dated as of August 8, 2000, and that certain Amendment No.
2 to Employment Agreement dated as of February 23, 2001 (as amended, the
"Employment Agreement").  The Employer and the Employee now desire to further
amend the Employment Agreement as hereinafter provided.

     B.   Accordingly, and intended to be legally bound hereby, the Employer and
the Employee agree as follows:

                                   Agreement
                                   ---------

     1.   The phrase "employed by the Employer" which appears in the first
sentence of Section 3.07 of the Employment Agreement is hereby amended and
restated as follows:

          "an employee, director, consultant, advisor or independent contractor
          of the Employer, or an affiliate of the Employer"

          In addition, the following new paragraph is added to the end of
          Section 3.07:

          "The obligation of the Employer to pay the premiums described in this
          Section 3.07 will survive the termination or expiration of this
          Agreement so long as the Employee continues to serve the Employer, or
          any affiliate of the Employer, as an employee, director, consultant,
          advisor or independent contractor."

     2.   Except as amended hereby, the Employment Agreement shall continue in
effect in accordance with its terms.
<PAGE>

     IN WITNESS WHEREOF, the parties have executed this Amendment as of the date
first above written.

                                        SELECT MEDICAL CORPORATION

                                        By: Michael E. Tarvin
                                           -----------------------------
                                                Michael E. Tarvin,
                                                Senior Vice President

                                            Rocco A. Ortenzio
                                           -----------------------------
                                                Rocco A. Ortenzio

                                      -2-<PAGE>

                                                                   EXHIBIT 10.51

                   FIRST AMENDMENT TO COST SHARING AGREEMENT
                   -----------------------------------------

          THIS FIRST AMENDMENT is made as of the 1st day of April, 2001, by and
among SELECT TRANSPORT, INC., a Delaware corporation ("ST"), having an address
at 4718 Old Gettysburg Road, Mechanicsburg, Pennsylvania 17055, SELECT MEDICAL
CORPORATION, a Delaware corporation ("SMC"), having an address at 4716 Old
Gettysburg Road, P.O. Box 2034, Mechanicsburg, Pennsylvania 17055, and SELECT
AIR II CORPORATION, a Pennsylvania corporation ("SAII"), having an address at
4718 Old Gettysburg Road, Mechanicsburg, Pennsylvania 17055.

                                  BACKGROUND
                                  ----------

     A.   ST, SMC and SAII executed and delivered that certain Cost Sharing
Agreement dated December 11, 2000 (the "Agreement"), pursuant to which the
parties agreed to share certain costs relating to the operation of a hanger and
aircraft located at Harrisburg International Airport.  All capitalized terms not
specifically defined herein shall have the meanings ascribed to them in the
Agreement.

     B.   ST, SMC and SAII now desire to amend the Agreement as hereinafter
provided.

     NOW, THEREFORE, the parties hereto, intending to be legally bound hereby,
covenant and agree as follows:

     1.   Amendment to Section 2. The percentage "40%" which is set forth in the
          ----------------------
second sentence of Section 2 of the Agreement is hereby changed to "25%".

     2.   No Other Modifications. Except as expressly amended hereby, the
          ----------------------
Agreement shall remain unmodified and in full force and effect.
<PAGE>

     IN WITNESS WHEREOF, the parties hereto have caused this First Amendment to
be executed the day and year first above written.

                              SELECT TRANSPORT, INC., a Delaware corporation

                              By: Michael E. Salerno
                                 --------------------------
                                   Michael E. Salerno
                                   Treasurer

                              SELECT MEDICAL CORPORATION., a Delaware
                              corporation

                              By: Michael E. Tarvin
                                 --------------------------
                                   Michael E. Tarvin
                                   Senior Vice President

                              SELECT AIR II CORPORATION, a Pennsylvania
                              corporation

                              By: Michael E. Salerno
                                 --------------------------
                                   Michael E. Salerno
                                   Vice President

                                      -2-<PAGE>

                                                                   EXHIBIT 10.52

                           Old Gettysburg Associates
                           4718 Old Gettysburg Road
                           Mechanicsburg, Pa  17055

                       Third Addendum To Lease Agreement
                       ---------------------------------

THIS THIRD AMENDMENT (this "Third Amendment") is made as of the 17th day of May,
2001, by and between OLD GETTYSBURG ASSOCIATES, a Pennsylvania general
partnership ("Landlord"), and SELECT MEDICAL CORPORATION, a Delaware corporation
("Tenant").

                                  BACKGROUND:
                                  -----------

A.    Landlord and Tenant are parties to that certain Office Lease Agreement
      dated June 15, 1999 (the "Lease"), and the First and Second Amendments
      pursuant to which Landlord leased to Tenant, and Tenant hired from
      Landlord, approximately 12,400 rentable square feet of space in the
      building located at 4718 Old Gettysburg Road, Mechanicsburg, Pennsylvania.
      All capitalized terms not otherwise defined herein shall have the meanings
      ascribed to them in the Lease.

B.    Tenant and Landlord desire to extend the term of the Lease Agreement.

C.    Landlord and Tenant now desire to amend the Lease as hereinafter set
      forth.

NOW, THEREFORE, in consideration of the mutual covenants and promises contained
herein, and intending to be legally bound hereby, Landlord and Tenant agree as
follows:

      1.   The Lease Term shall be extended through December 31, 2014.

      2.   All other terms and conditions contained in the Lease and not amended
           hereby remain in full force and effect.
<PAGE>

IN WITNESS WHEREOF, Landlord and Tenant have caused this Third Amendment to be
duly executed as of May ___, 2001.

                                   Landlord:

                                   Old Gettysburg Associates
                                   a Pennsylvania general partnership

Witness: Linda F. Kilmore          By: Michael E. Salerno         Date: 5/22/01
        ------------------------      --------------------------       ---------
                                          Michael E. Salerno
                                          Agent for Owner

                                   Tenant:

                                   Select Medical Corporation
                                   a Delaware Corporation

Attest: Michael Tarvin            By:  Scott A. Romberger         Date: 5/17/01
        ------------------------      --------------------------       ---------
           Michael Tarvin                 Scott A. Romberger
           Secretary                      Vice President

                                      -2-<PAGE>

                                                                   Exhibit 10.53

                               TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                     Page
                                                                                     ----
<S>                                                                                  <C>
ARTICLE 1  PREMISES...............................................................      2
ARTICLE 2  TERM...................................................................      2
ARTICLE 3  DELIVERY OF THE PREMISES TO TENANT.....................................      2
ARTICLE 4  ACCEPTANCE OF THE PREMISES AND BUILDING BY TENANT......................      2
ARTICLE 5  RENTAL.................................................................      3
ARTICLE 6  OPERATING EXPENSES.....................................................      3
ARTICLE 7  SERVICES BY LANDLORD...................................................      6
ARTICLE 8  UTILITIES..............................................................      6
ARTICLE 9  USE....................................................................      8
ARTICLE 10 LAWS, ORDINANCES AND REQUIREMENTS OF PUBLIC AUTHORITIES................      8
ARTICLE 11 OBSERVANCE OF RULES AND REGULATIONS....................................      9
ARTICLE 12 ALTERATIONS............................................................      9
ARTICLE 13 LIENS..................................................................      9
ARTICLE 14 ORDINARY REPAIRS.......................................................     10
ARTICLE 15 INSURANCE..............................................................     10
ARTICLE 16 DAMAGE BY FIRE OR OTHER CAUSE..........................................     12
ARTICLE 17 CONDEMNATION...........................................................     13
ARTICLE 18 ASSIGNMENT AND SUBLETTING..............................................     13
ARTICLE 19 INDEMNIFICATION........................................................     14
ARTICLE 20 SURRENDER OF THE PREMISES..............................................     15
ARTICLE 21 ESTOPPEL CERTIFICATES..................................................     16
ARTICLE 22 SUBORDINATION..........................................................     16
ARTICLE 23 PARKING................................................................     17
ARTICLE 24 DEFAULT AND REMEDIES...................................................     17
ARTICLE 25 WAIVER BY TENANT.......................................................     20
ARTICLE 26 SECURITY DEPOSIT.......................................................     20
ARTICLE 27 ATTORNEY'S FEES AND LEGAL EXPENSES.....................................     20
ARTICLE 28 NOTICES................................................................     21
ARTICLE 29 MISCELLANEOUS..........................................................     21
</TABLE>

<PAGE>

                            OFFICE LEASE AGREEMENT

THIS Lease, dated as of the date specified in the Basic Lease Information which
is attached hereto and incorporated herein for all purposes, is made between
Landlord and Tenant.

                                   ARTICLE 1

                                   Premises
                                   --------

Landlord leases to Tenant, and Tenant leases from Landlord for the Term (as
defined below) and subject to the provisions hereof, to each of which Landlord
and Tenant mutually agree, the Premises, which Premises is more particularly
described in the floor plans in Exhibit A hereto, together with its
appurtenances, including the right to use, in common with others, the lobbies,
entrances, stairs, elevators, off-street parking and loading areas (for loading
and unloading of materials and supplies), and other public portions of the
Building, which Building is situated on the real property described in Exhibit B
hereto. The Premises shall constitute part of the "Rentable Area," which shall
be determined and defined by Landlord using standards adopted by Building Owners
and Managers Association (BOMA). For purposes of this Lease, the Rentable Area
of the Building and the Rentable Area of the Premises are as provided in the
foregoing Basic Lease Information. The term "Common Areas" shall mean all of the
common facilities now or hereafter under, over, in or adjacent to the Building
designed and intended for use by all Tenants in the Building in common
facilities now or hereafter under, over, in or adjacent to the Building designed
and intended for use by all Tenants in the Building in common with Landlord and
each other.

                                   ARTICLE 2

                                     Term
                                     ----

Section 2.01.    The term of this Lease (the "Term") shall begin on the
-------------
Commencement Date. The Commencement Date shall be the earlier of the date:

     (a)  specified in the Basic Lease Information provided Landlord has
          delivered the Premises with the Building Standard Leasehold
          Improvements as set forth on Exhibit C substantially completed: or

     (b)  of Tenant's occupancy of the Premises for the conduct of Tenant's
          business (i.e. not occupancy for construction purposes)(the
          "Commencement Date").

Unless sooner terminated, the Term shall end at midnight on the Expiration Date
specified in the Basic Lease Information

Section 2.02.    Provided Tenant performs all of Tenant's obligations under this
-------------
Lease, including Tenant's covenant for the payment of Rental as defined below,
Tenant shall, during the Term, peaceably and quietly enjoy the Premises without
disturbance from Landlord; subject, however, to the terms of this Lease and any
deeds of trust, restrictive covenants, ground leases, easements, and other
encumbrances to which this Lease now or may become subject and subordinate.

                                   ARTICLE 3

                      Delivery of the Premises to Tenant
                      ----------------------------------

Before the Commencement Date, Landlord shall substantially complete the floor(s)
or portions thereof on which the Premises are located and shall construct the
Leasehold Improvements, if any, to be constructed or installed by Landlord
pursuant to the provisions of Exhibit C hereto. If for any reason Landlord
cannot deliver the Premises to Tenant by the Commencement Date, this Lease shall
not be void or voidable, nor shall Landlord be liable for any loss or damage
resulting therefrom, except that the Rental shall be waived for the period
between the Commencement Date and the date when Landlord can deliver possession
and Landlord shall extend the Term. Tenant may not enter or occupy the Premises
until it is tendered by Landlord, unless Tenant's entry relates to construction
work in the Premises. The Premises shall be deemed completed and possession
delivered when the Premises is completed to accommodate Tenants use. The terms
of Exhibit C hereto shall govern the construction and installation of all
Leasehold Improvements. The term "Building Standard Leasehold Improvements" as
used herein shall mean those Leasehold Improvements which conform to Building
Standard. The term "Non-Building Standard Leasehold Improvements" as used herein
shall mean all Leasehold Improvements which exceed or deviate from Building
Standard. The terms "Building Standard" and "Non-Building Standard" as used
herein shall have the meanings specified in Exhibit C hereto.

                                   ARTICLE 4

               Acceptance of the Premises and Building by Tenant
               -------------------------------------------------

Taking possession of the Premises by Tenant shall be conclusive evidence that
Tenant:

     (a)  accepts the Premises as suitable for the purposes for which they are
          Leased;

     (b)  accepts the Building and every part and appurtenance thereof as being
          in a good and satisfactory condition; and

     (c)  waives any defects in the Premises and its appurtenances, except for
          the completion of those items, if any, on any punchlist and on Exhibit
          C attached hereto.

Landlord shall not be liable, except for negligence or willful misconduct, to
Tenant or any of its agents, employees, licensees, or invitees for any injury or
damage to person or property due to the condition or design of or any defect in
the Building or its mechanical systems and equipment which may exist or occur,
and Tenant, for itself and its agents, employees, licensees, and invitees,
expressly assumes all risks of injury or damage to person or property, either
proximate or remote, resulting from the condition of the Premises or the
Building.

                                      -2-
<PAGE>

                                   ARTICLE 5

                                    Rental
                                    ------

Section 5.01.    Tenant covenants and agrees to pay to Landlord as Rental for
-------------
the Premises, in lawful money of the United States, 1/12 of the Annual Base
Rental specified in the Basic Lease Information, payable monthly in advance,
without notice or demand, on the first day of each calendar month- In the event
of any late payment, Tenant agrees to pay a late charge for special handling
equal to 5% of the Rental due. Rental shall be paid to Landlord, without
deduction or offset, at the address of Landlord specified in the Basic Lease
Information or such other place as Landlord may designate in writing. The first
monthly installment of Rental shall be paid on the Commencement Date, except
that if the Commencement Date is a date other than the first day of a calendar
month, then the monthly Rental for the first and last fractional months of the
Term shall be appropriately prorated. The term "Rental" as used herein means the
sum of Annual Base Rental, Proportionate Share of Operating Expense Excess (as
defined in. Section 6.01), Parking Rental (as defined in Exhibit D hereof), and
all other suns, whether or not expressly denominated as rent, shall constitute
Rental for the purposes of Section 502(b)(7) of the Bankruptcy Code U.S.C.
502(b)(7). A service charge of 10% of the amount of any checks returned stamped
"NSF" will be due and payable, in addition to the overdue installments to cover
Landlord's extra cost and expense in handling and processing. No payment by
Tenant or receipt by Landlord of a lesser amount than the monthly installment
due under this Lease shall be deemed to be other than on account of the earliest
Rental due hereunder, nor shall any endorsement or statement on any check or
payment as Rental be deemed an accord and satisfaction, and Landlord may accept
such check or payment without prejudice to Landlord's right to recover the
balance of such Rental or pursue any other remedy provided in this Lease or by
law.

Section 5.02.    Upon the first anniversary of the Commencement Date of this
-------------
Lease, and upon each and every anniversary date thereafter, the then current
Annual Base Rental shall be increased by the Annual Base Rental Rate Increase
(cumulative) as specified in the Basic Lease Information.

                                   ARTICLE 6

                              Operating Expenses
                              ------------------

Section 6.01.    From the Commencement Date until the Fiscal Year End following
-------------
the Commencement Date, Tenant shall pay on a monthly basis in advance, without
demand, on the first day of each calendar month, as part of the Annual Base
Rental, Tenant's Proportionate Share of Operating Expenses (as defined in
article 6 and 7) in excess of the Initial Operating Expense Allowance
("Operating Expense Excess").  Such payments shall be calculated and made as
follows:

     (a)  Before the beginning of each Fiscal Year during the Term, Landlord
          shall furnish Tenant with Landlord's reasonable estimate of the
          Operating Expenses and any

                                      -3-
<PAGE>

          anticipated Operating Expense Excess for such Fiscal Year. On the
          first day of each month during such Fiscal Year, Tenant shall pay
          Tenant's Proportionate Share of such Fiscal Year's estimated Operating
          Expense Excess in monthly installments of 1/12th of Tenant's
          Proportionate Share of the estimated annual Operating Expense Excess
          of such Fiscal Year.

     (b)  By the first day of March of each Fiscal Year during Tenant's
          occupancy (beginning with the Fiscal Year following the Commencement
          Date), or as soon thereafter as possible, Landlord shall furnish to
          Tenant a statement of Landlord's actual Operating Expense Excess for
          the previous Fiscal Year or fraction thereof if the Commencement Date
          occurred after the first day of the previous Fiscal Year. If the
          actual Operating Expense Excess is greater than Landlord's estimate, a
          lump sum payment, considered Rental for all purposes, shall be made by
          Tenant, within 30 days of the delivery of that statement, equal to
          Tenant's Proportionate Share of the actual Operating Expense Excess
          over the Landlord's estimate for the previous Fiscal Year. If the
          actual Operating Expense Excess is less than Landlord's estimate, a
          lump sum payment shall be made by Landlord, within 30 days of delivery
          of that statement, equal to Tenant's Proportionate Share of the actual
          Operating Expense Excess under Landlord's estimate. The effect of this
          reconciliation payment or adjustment is that the Tenant shall pay
          during each Fiscal Year during the Term, in addition to the Annual
          Base Rental, Tenant's Proportionate Share of Operating Expenses in
          excess of an amount equal to that Fixed years allowance. Said amount
          is based upon 12 months of building operation with all tenants
          utilizing all services provided by Landlord pursuant to Article 7 and
          Article 8.

     (c)  The Annual Operating Expense Allowance shall be increased each fiscal
          year by the Annual Operating Expense Allowance Increase (cumulative)
          as specified in the Basic Lease Information.

     (d)  With respect to the last Fiscal Year or partial Fiscal Year, as the
          case may be, during the Term, an adjustment will be made between
          Landlord and Tenant pursuant to Section 6.02, at the appropriate time
          after the Expiration Date. The provisions of the paragraph (d) shall
          survive termination of this Lease with respect to such adjustment and
          any payments owing by either party to the other after termination
          hereof.

Section 6.02.    As used herein, "Operating Expense" means all expenses, costs,
-------------
and disbursements of every kind which Landlord pays or incurs in connection with
the ownership, operation (including, without limitation, the costs of
utilities), and maintenance of the Building, Parking Areas, and exterior areas
contained within the boundaries described in Exhibit B upon which the Building
is situated. All Operating Expenses shall be determined according to generally
accepted accrual accounting principles which shall be consistently applied.
Operating Expenses shall include, but are not limited to, the following:

     (a)  Wages, salaries, and fees of all personnel or entities (exclusive of
          Landlord's executive personnel) directly engaged in the operation,
          maintenance, repair, or

                                      -4-
<PAGE>

          security of the Building, including taxes, insurance, and benefits
          relating thereto. As to personnel not involved exclusively with the
          administration and operation of the Building, only those portions of
          such expenses reasonably allocable to the Building shall be included.

     (b)  All supplies and materials used in the operation and maintenance of
          the Building, except for special lighting, relamping and ballasts
          within any Tenant space.

     (c)  Expenses of all maintenance, janitorial, security, and service
          agreements for the Building and the equipment therein, including,
          without limitation, alarm service, janitorial services, exterior
          window cleaning, elevator maintenance, landscaping, parking facility
          maintenance, roadway and utility maintenance and cleaning, etc.

     (d)  Expenses of all insurance relating to the Building for which Landlord
          is responsible hereunder, or which Landlord considers reasonably
          necessary for the operation of the Building, including, without
          limitation, the cost of property, casualty and liability insurance
          applicable to the Building and Landlord's personal property used in
          connection therewith, and the cost of business interruption or rental
          insurance.

     (e)  All taxes, assessments, and other governmental charges, now or
          hereafter applicable to the Building, or any portion thereof, or to
          Landlord's personal property used in connection therewith, and dues
          (including those levied by any Association managing all common areas
          and easements) attributable to the Building or its operation,
          exclusive of any inheritance, gift, franchise, income, corporate, or
          profit taxes which may be assessed against Landlord.

     (f)  Expenses of repairs and general maintenance (excluding repairs and
          general maintenance paid by proceeds of insurance or by Tenant or
          other third parties, and alterations attributable solely to Tenants of
          the Building).

     (g)  Landlord's Costs related to fees paid to individuals or companies
          engaged in rendering legal, accounting or technical services including
          efforts to reduce Building Ad Valorem Tax expenses.

     (h)  All utility costs to Landlord of the Building (exclusive, however, of
          such special utility services as are provided in Section 8.02 hereof),
          including, without limitation, water, power, fuel, healing, lighting,
          air conditioning, and ventilation.

Operating Expenses shall not include specific costs especially billed to and
paid by specific Tenants such as above Building Standard janitor service, above
Building Standard utility service, or other services above Building Standard.

Tenant shall be liable for all taxes levied or assessed against personal
property, furniture, fixtures, or Tenant finish placed by Tenant in the
Premises. If any such taxes for which Tenant is liable are levied or assessed
against Landlord or Landlord's property, and Landlord elects to pay the taxes
based on such increase, Tenant shall pay to Landlord upon demand that part of
such taxes for which Tenant is liable hereunder; provided that Tenant shall have
the right to contest

                                      -5-
<PAGE>

such taxes if Tenant shall have furnished Landlord with security sufficient in
Landlord's reasonable determination.

                                   ARTICLE 7

                             Services by Landlord
                             --------------------

While Tenant is occupying the Premises and is not in default under this Lease,
Landlord shall, at its expense, but subject to the provisions of Articles 6 and
8 hereof, furnish the Premises with:

     (a)  passenger elevator service (where applicable) in common with other
          Tenants for access to and from the Premises, reasonably limited after
          normal business hours and on Saturdays, Sundays, and holidays;

     (b)  janitorial cleaning services as are customarily provided to Tenants in
          comparable office buildings in the greater Harrisburg area; and

     (c)  the utility services provided for in Article 8 below.

                                   ARTICLE 8

                                   Utilities
                                   ---------

Section 8.01.    While Tenant is occupying the Premises and is not in default
-------------
under this Lease, Landlord shall furnish Tenant with the following services:

     (a)  potable water

     (b)  heating, ventilating, and/or air conditioning in season on business
          days from 7:00 a.m. to 6:00 p.m.

     (c)  electric lighting for public areas and special Services Areas of the
          Building

all of which services shall be provided to Tenant by Landlord and paid for by
Landlord as part of the Operating Expense Allowance.  If Tenant requires air
conditioning or heating outside the hours and days specified above, Landlord
shall furnish it only at Tenant's request, and Tenant will bear the entire
charge therefor which will be an amount equal to the rate charged to Landlord,
at that time, plus a reasonable fee to cover Landlord's overhead costs, with a
two-hour minimum.  With respect to such after hours costs, Landlord acknowledges
that the current after hours charge is $35.00 per hour.  Whenever machines or
equipment that generate abnormal heat are used in the Premises by Tenant which
affect the temperature or humidity otherwise maintained by the central air
conditioning system, Landlord will have the right to install supplemental air
conditioning units in the Premises, and the full total cost thereof, will be
paid by Tenant to Landlord on demand.  Notwithstanding anything in this Lease to
the contrary, Tenant

                                      -6-
<PAGE>

shall be responsible for the cost of special lighting relamping and ballasts
within the Premises after initial installation of such items.

Section 8.02.    While Tenant is occupying the Premises and is not in default
-------------
under this Lease, Landlord will furnish sufficient power for lighting and for
typewriters, dictaphones, personal computers, calculating machines, and other
normal office machines of similar low electrical consumption, all of which power
shall be paid for by Landlord as a part of the Operating Expense Allowance.
Tenant agrees that Landlord's aforesaid obligation does not include the
provision of power for:

     (a)  special mainframe type computers and/or electronic data processing
          equipment,

     (b)  special lighting which has electrical consumption in excess of the
          Building Standard lighting, or

     (c)  any item that consumes more than 0.5 kilowatts at rated capacity or
          requires a voltage other than 120 volt single phase

and such consumption by Tenant shall be deemed excessive usage for which Tenant
shall pay Landlord upon receipt of an invoice for the cost to Landlord of such
usage.  Notwithstanding the aforementioned, Tenant acknowledges that the
Building electrical feeders have normal design limitations, such that

          (i)   in no event shall lighting have a design load greater than an
                average of 2.00 watts per Usable square foot, and

          (ii)  collectively, Tenant's equipment and lighting shall not have an
                electrical design load greater than an average of 3.75 watts per
                Usable square foot.

Upon the existence of Tenant's excess electrical requirements, Landlord may, at
its option, upon not less than 30 days prior written notice to Tenant,
discontinue electric services to the Premises until Tenant reduces its power
consumption to the permissible limits.  Landlord will not be liable in any way
to Tenant for failure or defect in the supply or character of electric energy or
any other utility service furnished to the Premises because of any requirement,
act, or omission of the public utility servicing the Building.  All
installations of electrical fixtures, appliances, and equipment within the
Premises shall be subject to Landlord's prior approval. Landlord's obligation to
furnish utility services shall be subject to the rules and regulations of any
municipal or other governmental authority regulating the business of providing
utility services. When Tenant's use of the Premises consumes power in excess of
the Building Standard lighting and for typewriters, dictaphones, calculating
machines and other normal office machines of similar low consumption, then the
usage of such additional consumption shall be determined, at Landlord's
election, either

          (i)   by a survey performed by a reputable consultant selected by
                Landlord (and paid for by Tenant when such additional
                consumption is proven), or

                                      -7-
<PAGE>

          (ii)  by separate meter in the Premises to be installed, maintained
                and read by Landlord at Tenant's sole expense.

Section 8.03.    Failure to furnish, or any stoppage of, the services provided
-------------
for in Article 7 above and in this Article 8 resulting from any cause will not
make Landlord liable in any respect for damages to either person, property, or
business, nor be construed as an eviction of Tenant, nor entitle Tenant to any
abatement of Rental, nor relieve Tenant from its obligations under this Lease.
Landlord will, with reasonable diligence, repair any malfunction of the Building
Improvements or facilities, but Tenant will have no claim for rebate, abatement
of Rental, or damages because of any malfunctions or interruptions in service.

                                   ARTICLE 9

                                      Use
                                      ---

The Premises shall be used for general office purposes, and for no other purpose
and Tenant agrees to use and maintain the Premises in a clean, careful, safe,
lawful, and proper manner.

                                  ARTICLE 10

            Laws, Ordinances and Requirements of Public Authorities
            -------------------------------------------------------

Tenant shall, at its sole expense,

               (i)   comply with all laws, orders, ordinances, and regulations
                     of federal, state, county, and municipal authorities having
                     jurisdiction over the Premises,

               (ii)  comply with any direction made pursuant to law of any
                     public officer or officers requiring abatement of any
                     nuisance, or imposing any obligation, order, or duty upon
                     Landlord or Tenant arising from Tenant's use of the
                     Premises or from conditions which have been created by or
                     at the insistence of Tenant or required by reason of a
                     breach of any of Tenant's obligations hereunder, and

               (iii) indemnify Landlord and hold Landlord harmless from any
                     loss, cost, claim, or expense which Landlord may incur or
                     suffer by reason of Tenant's failure to comply with its
                     obligations under clauses (i) or (ii) above. If Tenant
                     receives written notice of violation of any such law,
                     order, ordinance, or regulation, it shall promptly notify
                     Landlord thereof.

                                      -8-
<PAGE>

                                  ARTICLE 11

                      Observance of Rules and Regulations
                      -----------------------------------

Tenant and its employees, agents, visitors, and licensees shall observe
faithfully and comply strictly with all Rules and Regulations attached to this
Lease (Exhibit F).  Landlord shall at all times have the right to make
reasonable exchanges in and additions to such Rules and Regulation.  Any failure
by Landlord to enforce any of the Rules and Regulations now or hereafter in
effect, either against Tenant or any other Tenant in the Building, shall not
constitute a waiver of any such Rules and Regulations.  Landlord shall not be
liable to Tenant for the failure or refusal by any other Tenant, guest, invitee,
visitor, or occupant of the Building to comply with any of the Rules and
Regulations, but Landlord shall, after receipt of notice, take reasonable action
to assure compliance.

                                  ARTICLE 12

                                  Alterations
                                  -----------

Section 12.01.    Tenant may not, at any time during the Term, without
--------------
Landlord's prior written consent (which consent shall not be unreasonably
withheld), make any alterations to the Premises.  All alternations shall be made
at Tenant's expense, either by Tenant's contractors which have been approved in
writing by Landlord, or at Landlord's option, by Landlord's contractors on terms
reasonably satisfactory to Tenant, including a fee of 15% of the actual costs to
Landlord for performing such work to cover Landlord's overhead.

Section 12.02.    All Leasehold Improvements (whether Building Standard or Non-
--------------
Building Standard), alterations, and other physical additions made or installed
by or for Tenant in or to the Premises shall be and remain Landlord's property,
except Tenant's furniture, furnishings, personal property, and moveable trade
fixtures and shall not be removed without Landlord's written consent.

                                  ARTICLE 13

                                     Liens
                                     -----

Tenant shall keep the Premises, the Buildings, and the property on which the
Building is located, free from any liens arising from any work performed,
materials furnished, or obligations incurred by or at the request of Tenant.
Nothing contained in this Lease' shall be construed as Landlord's consent to any
performance of labor or furnishing of any materials for any specific
improvements, alteration, or repair of, or to, the Premises, that would result
in any liens against the Premises or liability of the Landlord.  If, based upon
acts of Tenant, any lien is filed against the Premises, the Building, the
Property on which the Building is located, or Tenant's Leasehold interests
therein, Tenant shall discharge same within 10 days after its filing.  If Tenant
fails to

                                      -9-
<PAGE>

discharge such lien within such period, then, in addition to any other right or
remedy of Landlord, Landlord may, at its election, discharge the lien by either
paying the amount claimed to be due, obtaining the discharge by deposit with a
court or a title company, or by bonding. Tenant shall pay on demand any amount
paid by Landlord for reasonable attorneys' fees and other legal expenses of
Landlord incurred in defending any such action or in obtaining the discharge of
such lien, together with all necessary disbursements in connection therewith, to
double the amount of the lien claim plus a sufficient amount to cover any
penalties, interest, attorneys' fees, court costs, and other legal expenses
resulting from such contest. This bond shall name Landlord and such other
parties as Landlord may direct as beneficiaries thereunder.

                                  ARTICLE 14

                               Ordinary Repairs
                               ----------------

Tenant shall, at all times during the Term hereof and at Tenants sole cost and
expense, keep the Premises and every part thereof in good condition and repair,
ordinary wear and tear, fire and other casualty excepted. Subject to Article 20,
section 20.02 herein, Tenant shall, at the end of the term hereof, surrender the
Premises, as repaired, to Landlord in the same condition as when received,
ordinary wear and tear excepted.  If Tenant fails to make such repairs promptly,
Landlord may, at its option, make such repairs, and Tenant shall pay Landlord on
demand Landlord's actual costs in making such repairs plus a fee of (15%) to
cover Landlord's overhead.

                                  ARTICLE 15

                                   Insurance
                                   ---------

Section 15.01.    Tenant shall, during the Term, at its sole expense, keep in
--------------
force, with Tenant, Landlord, and the mortgagees and ground lessors of Landlord
named as additional insured thereunder (except with respect to Worker's
Compensation coverage) all as their respective interests may appear, the
following insurance:

     (a)  All Risk Insurance (including fire, extended coverage, vandalism,
          malicious mischief, extended perils, sprinkler leakage and debits
          removal) upon property of every description and kind owned by Tenant
          and located in the Building or for which Tenant is legally liable or
          installed by or on behalf of Tenant including, without limitation,
          fittings, installations, fixtures, removable trade fixtures, Non-
          Building Standard Leasehold Improvements (as defined in Exhibit C),
          and alterations, in an amount not less than the full replacement cost
          thereof. If there is a dispute as to the amount which comprises full
          replacement cost, the decision of Landlord or the mortgagees of
          Landlord shall be conclusive and binding.

     (b)  Commercial liability insurance coverage to include death, personal
          injury, bodily injury (not less than $1,000,000 limits), broad form
          property damage (not less than $1,000,000 limits), fire sprinkler
          hazard, operations hazard, owner's protective coverage, contractual
          liability, and products and completed operations

                                      -10-
<PAGE>

          liability, with combined single liability limits not less than
          $1,000,000. Such coverage shall insure against all liability of Tenant
          and its authorized representatives and visitors arising out of, and in
          connection with, Tenant's use or occupancy of the Premises.

     (c)  Worker's Compensation and Employer's Liability Insurance, with a
          waiver of subrogation endorsement, in form and amount satisfactory to
          Landlord.

     (d)  Any other form or forms of insurance as Tenant or Landlord or the
          mortgagees of Landlord may reasonably require from time to time in
          form, in amounts, and for insurance risks against which a prudent
          Tenant of a comparable size and in a comparable business would protect
          itself.

All policies shall be issued by insurers with a Best's Insurance Reports rating
of A or better and shall be in form satisfactory to Landlord. Tenant agrees that
certificates of insurance on the Landlord's standard form, or certified copies
of each such insurance policy, naming Landlord and its mortgagees as additional
insured, will be delivered to Landlord not later than 5 days prior to the date
that Tenant takes possession of any part of the Premises. All policies shall
contain an undertaking by the insurers to notify Landlord and the mortgagees of
Landlord in writing, by Registered US. Mail, not less than 30 days before any
material change, reduction in coverage, cancellation, or other termination
thereof.  All insurance shall be primarily as to Landlord and not participating
with any other available insurance.  So long as Tenant is not in default,
proceeds of Tenant's insurance shall be available to repair or replace the
insured fixtures and equipment.

Section 15.02.    During the Term, Landlord shall insure the Building (but
--------------
excluding Non-Building Standard Leasehold Improvements and any other property
which Tenant is obligated to insure under Section 15.01 hereof) against damage
by fire and standard extended coverage perils in an amount equal to the full
replacement cost thereof, and shall provide public liability insurance in such
amounts and with such deductions as Landlord considers appropriate.  Landlord
may, but shall not be obligated to, take out and carry any other form or forms
of insurance as it or Landlord's mortgagees may reasonably determine
appropriate.  Notwithstanding any contribution by Tenant to the cost of
insurance premiums, as provided herein, Tenant acknowledges that it has no right
to receive any proceeds from any insurance policies carried by Landlord.
Landlord will not be required to carry insurance of any kind on any Non-Building
Standard Leasehold Improvements, on Tenant's furniture or furnishings, or on any
of Tenant's fixtures, equipment, improvements, or appurtenances under this
Lease; and Landlord shall not be obligated to repair or replace same.

Section 15.03.    Tenant shall not keep in the Premises any article which may be
--------------
prohibited by any reasonable insurance policy periodically in force covering the
Building.  If Tenant's occupancy results in any increase in premiums for the
insurance carried by Landlord, Tenant shall pay any such increase in premiums as
additional Rental within 10 days after being billed therefor. Tenant shall
promptly comply with all reasonable requirements of the insurance authority or
any present or future insurer relating to the Premises and the Building.

                                      -11-
<PAGE>

Section 15.04.    If any of Landlord's insurance policies shall be cancelled or
--------------
cancellation shall be threatened or the coverage thereunder reduced or
threatened to be reduced, or if the premiums on any of Landlord's insurance
policies are increased or threatened to be increased, in any way because of
Tenant's use of the Premises and, if Tenant fails to remedy the cause thereof
within 48 hours after notice, Landlord may, at its option, either terminate this
Lease or enter upon the Premises and attempt to remedy such condition, and
Tenant shall promptly pay the cost thereof to Landlord as additional Rental.
Landlord shall not be liable for any damage or injury caused to any property of
Tenant or of others located on the Premises resulting from such entry. If
Landlord is unable to remedy such condition, then Landlord shall have all of the
remedies provided for in this Lease in. the event of a default by Tenant.

Section 15.05.    All policies covering real or personal property which either
--------------
party obtains affecting the Premises shall include a clause or endorsement
denying the insurer any rights of subrogation against the other party to the
extent rights have been waived by the insured before the occurrence of injury or
loss. Landlord and Tenant hereby mutually waive any rights of recovery against
the other for injury or loss due to hazards covered by insurance containing such
a waiver of subrogation clause or endorsement to the extent of the injury or
loss covered thereby.

                                  ARTICLE 16

                         Damage by Fire or Other Cause
                         -----------------------------

Section 16.01.    Subject to Sections 16.02 and 16.03 hereof, if the Building is
--------------
damaged by fire or other casualty so as to affect the Premises, Tenant shall
immediately notify Landlord, who shall (but only if the proceeds from Landlord's
insurance available to Landlord

          (i)  are free from collection by Landlord's mortgagee, ground or
               primary lessor, and

          (ii) are sufficient)

have the damage repaired with reasonable speed at the expense of Landlord,
subject to delays which may arise by reason of adjustment of loss under the
insurance policies and to other delays beyond Landlord's reasonable control.
Provided such damage was not the result of the negligence or willful misconduct
of Tenant, or Tenant's employees or invitees, an abatement in the Rental
hereunder shall be allowed as to that portion of the Premises rendered
untenantable by such damage until such time as Landlord determines that such
damaged portion of the Premises has been made tenantable for Tenant's use.

Section 16.02.    If the Premises are damaged or destroyed by any cause
--------------
whatsoever, and if, in Landlord's reasonable opinion, the Premises cannot be
rebuilt or made fit for Tenant's purposes within 120 days of the damage or
destruction, or if the proceeds from insurance remaining after payment of any
such proceeds to Landlord's mortgagee, ground, or primary lessor, are
insufficient to repair or restore the damage by destruction, Landlord may, at
its option, terminate this Lease by giving Tenant, within 60 days after such
damage or destruction, notice of termination, and thereupon Rental and any other
payments for which Tenant is liable under this

                                      -12-
<PAGE>

Lease shall be apportioned and paid to the date of such damage and Tenant shall
immediately vacate the Premises, provided, however, that those provisions of
this Lease which are designated to cover matters of termination and the period
thereafter shall survive the termination hereof.

Section 16.03.  If either
--------------

     (a)  the Building is damaged or destroyed to the extent that, in Landlords
          reasonable opinion it would not be economically feasible to repair or
          restore such damage or destruction, or

     (b)  in Landlord's reasonable judgment, the damage or destruction to the
          Building cannot be repaired or restored within 60 days after such
          damage or destruction,

Landlord may, at its option, terminate this Lease by giving Tenant, within 60
days after such damage, notice of such termination requiring Tenant to vacate
the Premises 60 days after delivery of the notice of termination, and thereupon
Rental and any other payments shall be apportioned and paid to the date on which
possession is relinquished and Tenant shall immediately vacate the Premises
according to such notice of termination, provided, however, that those
provisions of this Lease which are designed to cover matters of termination and
the period thereafter shall survive the termination hereof.

Section 16.04.  No damages shall be payable by Landlord for inconvenience, loss
--------------
of business, or annoyance arising from any repair or restoration of any portion
of the Premises, or the Building. Landlord shall use its best efforts to have
such repairs made promptly so as not to unnecessarily interfere with Tenant's
occupancy.

Section 16.05.  The provisions of this Article shall be considered an express
--------------
agreement governing any case of damage or destruction of the Building, the
Building Standard Leasehold Improvements, the Non-Building Standard Leasehold
Improvements, the alterations, or the Premises by fire or other casualty.

                                  ARTICLE 17

                                 Condemnation
                                 ------------

If the Premises shall be taken or condemned, in whole or in part, for any public
purpose to such an extent as to render said Premises untenantable, this Lease
shall, at the option of Landlord or Tenant, forthwith terminate.  All proceeds
from any taking or condemnation shall belong to and be paid to Landlord, except
to the extent of any proceeds awarded to Tenant on account of moving and
relocation expenses and depreciation to and removal of Tenant's physical
property.

                                      -13-
<PAGE>

                                  ARTICLE 18

                           Assignment and Subletting
                           -------------------------

Section 18.01.  If Tenant should desire to assign this Lease or sublet the
--------------
Premises (or any part thereof), Tenant shall give Landlord written notice at
least 60 days in advance thereof. Landlord shall then have a period of 30 days
following receipt of such notice within which to notify Tenant in writing that
Landlord elects either

     (a)  to terminate this Lease as to the space so affected by Tenant in its
          notice, in which event Tenant, subject to the provisions of this Lease
          which expressly survive the termination hereof, shall be relieved of
          all further obligations hereunder as to such space;

     (b)  to permit Tenant to assign or sublet such space, subject however, to
          the subsequent written approval of the proposed assignee or subTenant
          by Landlord, and provided that if the Rental rate agreed upon between
          Tenant and its proposed subtenant is greater than the Rental rate that
          Tenant must pay Landlord hereunder, then 100% of such excess Rental
          shall be considered additional Rental owed by Tenant to Landlord, and
          shall be paid by Tenant to Landlord in the same manner that Tenant
          pays Annual Base Rental; or

     (c)  to refuse to consent to Tenant's assignment or subleasing of such
          space and to continue this Lease in full force and effect as to the
          entire Premises, in which case, any judgment against Landlord for
          unreasonable denial shall be limited to specific performance of
          approval of said assignment or sublease.

No assignment or subletting by Tenant shall relieve Tenant of Tenant's
obligations under this Lease. Any attempted assignment or sublease by Tenant in
violation of the terms and provisions of this Section 18.01 shall be void. In no
event shall Tenant solicit assignees or sublessees in other Buildings owned by
Landlord, or at less than a fair market rate.

Section 18.02.  Landlord may sell, transfer, assign, and convey all or any part
--------------
of the Building and any and all of its rights under this Lease, provided
Landlord's successor in interest assumes Landlord's obligations hereunder, and
in the event Landlord assigns its rights under this Lease, Landlord shall be
released from any further obligations hereunder, and Tenant agrees to look
solely to Landlord's successor in interest for performance of such obligations.

                                  ARTICLE 19

                                Indemnification
                                ---------------

Tenant waives all claims against Landlord for damage to any property or injury
to, or death of, any person in, upon, or about the Building, the Premises or
Parking Facilities arising at any time and from any and all causes whatsoever
other than solely by reason of the negligence or willful

                                      -14-
<PAGE>

misconduct of Landlord, its agents, employees, representatives, or contractors,
and Tenant agrees that it will defend, indemnify, save, and hold harmless,
Landlord from and against all claims, demands, actions, damages, loss, costs,
liabilities, expenses, and judgements suffered by, recovered from, or asserted
against Landlord on account of any damage to any property or injury to, or death
of, any person arising from the use of the Building, the Premises, or the
Parking Facilities by Tenant or its employees or invitees, except such as is
caused solely by the negligence or willful misconduct of Landlord, its agents,
employees, representatives, or contractors. Tenant's foregoing indemnity
obligation shall include reasonable attorneys' fees and all other reasonable
costs and expenses incurred by Landlord. The provisions of this Article 19 shall
survive the termination of this Lease with respect to any damage, injury, or
death occurring before such termination. If Landlord is made a party to any
litigation commenced by or against Tenant or relating to this Lease or to the
Premises, and provided that in any such litigation, Landlord is not finally
adjudicated to be at fault, then Tenant shall pay all costs and expenses,
including attorneys' fees and court costs, incurred by or imposed upon Landlord
because of any such litigation, and the amount of all such costs and expenses,
including attorneys' fees and court costs, shall be a demand obligation owing by
Tenant to Landlord, and shall be considered as additional Rental.

                                  ARTICLE 20

                           Surrender of the Premises
                           -------------------------

Section 20.01.  Upon the expiration or other termination of this Lease for any
--------------
cause whatsoever, Tenant shall peacefully vacate the Premises in as good order
and condition as the same were at the beginning of the Term or may thereafter
have been improved by Landlord or Tenant, subject only to reasonable use and
wear thereof, and repairs which are Landlord's obligation hereunder.

Section 20.02.  Landlord may require Tenant to remove any Non-Building
--------------
Standard Leasehold Improvements, alterations, and physical additions installed
in the Premises upon termination of this Lease. In the event Landlord so elects,
and Tenant fails to remove the aforementioned items, Landlord may remove and
store same at Tenant's cost, and Tenant shall pay Landlord on demand, the cost
of restoring the Premises to Building Standard, ordinary wear and tear excepted
Tenant agrees to remove, at Tenant's expense, all of its furniture, furnishings,
personal property, and moveable trade fixtures by the Expiration Date, and shall
promptly reimburse Landlord for the cost of repairing all damage done to the
Premises or the Building by such removal.

Section 20.03.  Should Tenant continue to hold the Premises after the
--------------
termination of this Lease, whether the termination occurs by lapse of time or
otherwise, such holding over shall, unless otherwise agreed to by Landlord in
writing, constitute and be construed as a tenancy at will at a daily Rental
equal to 1/30th of an amount equal to 2 times the monthly Rental Rate for the
Premises as of the date of termination, and subject to all of the other terms
set forth herein except any right to renew or expand this Lease. Tenant shall be
liable to Landlord for all damage which Landlord suffers because of any holding
over by Tenant, and Tenant shall indemnify Landlord against all claims made by
any other Tenant or prospective Tenant against Landlord resulting from delay by
Landlord in delivering possession of the Premises to such other Tenant or
prospective Tenant.

                                      -15-
<PAGE>

                                  ARTICLE 21

                             Estoppel Certificates
                             ---------------------

Tenant agrees to furnish, when requested by Landlord or the holder of any deed
of trust covering the Building, the Land, or any interest of Landlord therein, a
certificate signed by Tenant certifying to such parties as Landlord may
designate to the extent true matters with respect to the terms and status of
this Lease and the Premises, stating that Tenant, as of the date of such
certificate, has no charge, lien, or claim of offset under this Lease or
otherwise against Rentals or other charges due or to become due hereunder; and
such other matters as may be requested by Landlord or the holder of any such
deed of trust. To the extent any such statements requested are not true, Tenant
shall explain such facts in writing. Landlord agrees periodically to furnish,
when reasonably requested in writing by Tenant, certificates signed by Landlord
containing substantially the same information as described above.

                                  ARTICLE 22

                                 Subordination
                                 -------------

Section 22.01.  This Lease is subject and subordinate to any deeds of trust,
--------------
mortgages, or other security instruments, and any other supplements or
amendments thereto, which presently or may in the future cover the Building and
the Land or any interest of Landlord therein, and to any increases, renewals,
modifications, consolidations, replacements, and extensions of any of such deeds
of trust, mortgages, or security instruments. Landlord agrees to use his best
efforts to obtain for Tenant a "non-disturbance" agreement from the holder or
beneficiary of any deeds of trust, mortgages or other security instruments that
in the future may cover the Building and the Land or any interest of Landlord
therein. This provision is declared by Landlord and Tenant to be self-operative
and no further instrument shall be required to effect such subordination of this
Lease. Tenant shall, however, upon demand, execute, acknowledge, and deliver to
Landlord any further instruments and certificates evidencing such subordination
as Landlord may require. This Lease is further subject and subordinate to

     (a)  all ground or primary Leases in existence at the date hereof and to
          any supplements, modifications, and extensions thereof heretofore or
          hereafter made, and

     (b)  utility easements and agreements, covenants, restrictions, and other
          encumbrances which do not materially adversely effect Tenant's
          intended use of the Premises, both existing and future.

Section 22.02.  Notwithstanding the generality of the foregoing provisions of
--------------
Section 22.01 hereof, any such mortgagee or ground or primary lessor shall have
the right at any time to subordinate any such ground or primary Leases, deeds of
trust, mortgages, or other security instruments to this Lease on such terms and
subject to such conditions as such mortgagee or ground or primary lessor may
consider appropriate in its discretion.  At any time, before or after

                                      -16-
<PAGE>

the institution of any proceedings for the foreclosure of any such deeds of
trust, mortgages, or other security instruments or termination of any ground or
primary Lease, or sale of the Building under any such deeds of trust, mortgages.
or other security instruments or termination of any ground or primary Lease,
Tenant shall attorn to such ground or primary lessor or such purchaser upon any
such sale or the grantee under any deed in lieu of such foreclosure and shall
recognize such ground or primary lessor or such purchaser or grantee as Landlord
under this Lease The agreement of Tenant to attorn contained in the immediately
preceding sentence shall survive any such termination of any ground or primary
Lease, foreclosure sale, trustee's sale, or conveyance in lieu thereof. Tenant
shall upon demanded at any time, before or after any such termination execute,
acknowledge, and deliver to Landlord's mortgagee or ground or primary lessor any
written instruments and certificates evidencing such attornment as Landlord's
mortgagee or ground or primary lessor may reasonably require.

                                  ARTICLE 23

                                    Parking
                                    -------

Landlord will permit Tenant to use the areas designated by Landlord ("Parking
Facilities") for parking of vehicles in common with other Tenants in the
Building during the Term as more fully provided for in Exhibit D hereto.

                                  ARTICLE 24

                             Default and Remedies
                             --------------------

Section 24.01.  The occurrence of any one or more of the following events
--------------
shall, at Landlord's option, constitute an event of default of this Lease:

     (a)  if Tenant shall fail to pay any Rental or other sums payable by Tenant
          hereunder within 10 days of written notice thereof from Landlord
          (provided, however, if such event of default shall occur more than
          once in every 6 months period, Landlord shall not be required to
          provide any written notice of default and an event of default shall
          occur as and when such Rental or other sums becomes due and payable);

     (b)  if Tenant shall fail to perform or observe any other term hereof or
          any of the Rules and Regulations and such failure shall continue for
          more than 30 days after notice thereof from Landlord;

     (c)  if Tenant fails to take occupancy within 30 days following substantial
          completion;

     (d)  if Tenant deserts or vacates any substantial portion of the Premises;

     (e)  if any petition is filed by or against Tenant or any guarantor of
          Tenant's obligations under this Lease under any section or chapter of
          the present or any future Federal Bankruptcy Code or under any similar
          law or statute of the United States or any state thereof;

                                      -17-
<PAGE>

     (f)  if Tenant or any guarantor of Tenant's obligations under this Lease
          becomes insolvent or makes a transfer in fraud of creditors;

     (g)  if Tenant or any guarantor of this Lease makes an assignment for the
          benefit of creditors; or

     (h)  if a receiver, custodian, or trustee is appointed for Tenant or for
          any of the assets of Tenant which appointment is not vacated within 30
          days of the date of such appointment.

Section 24.02.  If an event of default occurs, at any time thereafter Landlord
--------------
may do one or more of the following without any additional notice or demand:

     (a)  Terminate this Lease, in which event Tenant shall immediately
          surrender the Premises to Landlord. If Tenant fails to do so, Landlord
          may, without notice and without prejudice to any other remedy Landlord
          may have, enter upon and take possession of the Premises and expel or
          remove Tenant and its effects without being liable to prosecution or
          any claim for damages therefor; and Tenant shall be liable to Landlord
          for all loss and damage which Landlord may suffer by reason of such
          termination, whether through inability to relet the Premises or
          otherwise, including any loss of Rental for the remainder of the Term.
          Any such loss of Rental shall be offset by any Rental received by
          Landlord as a result of reletting the Premises during the remainder of
          the Term.

     (b)  Terminate this Lease, in which event Tenant's event of default shall
          be considered a total breach of Tenant's obligations under this Lease
          and Tenant immediately shall become liable for such damages for such
          breach amount, equal to the total of:

               (1)  the costs of recovering the Premises;

               (2)  the unpaid Rental earned as of the date of termination, plus
                    interest thereon at a rate per annum from the due date equal
                    to 5% percent over the Prime Rate; provided, however, that
                    such interest shall never exceed the Highest Lawful Rate;

               (3)  the amount of the excess of

          (i)  the total Rental and other benefits which Landlord would have
               received under the Lease for the remainder of the Term, at the
               rates then in effect, together with all other expenses occurred
               by Landlord in connection with Tenant's default, over

          (ii) the Fair Market Rate of the balance of the Terms as of the time
               of such breach,

                                      -18-
<PAGE>

          which excess shall be discounted at the rate of 8% per annum to the
then present value; and

               (4)  all other sums of money and damages owing by Tenant and
                    Landlord.

     (c)  Enter upon and take possession of the Premises as Tenant's agent
          without terminating this Lease and without being liable to prosecution
          or any claim for damages therefor, and Landlord may relet the Premises
          as Tenant's agent and receive the Rental therefor, in which event
          Tenant shall pay to Landlord on demand the cost of renovating,
          repairing, and altering the Premises for a new Tenant or Tenants and
          any deficiency that may arise by reason of such reletting; provided,
          however, that Landlord shall have no duty to relet the Premises and
          Landlord's failure to relet the Premises shall not release or affect
          Tenant's liability for Rental or for damages.

     (d)  Do whatever Tenant is obligated to do under this Lease and may enter
          the Premises without being liable to prosecution or any claim for
          damages therefor, to accomplish this purpose. Tenant shall reimburse
          Landlord immediately upon demand for any expenses which Landlord
          incurs in thus effecting compliance with this Lease on Tenant's
          behalf, and Landlord shall not be liable for any damages suffered by
          Tenant from such action, whether caused by the negligence of Landlord
          or otherwise.

Section 24.03.  No act or thing done by Landlord or its agents during the Term
--------------
shall constitute an acceptance of an attempted surrender of the Premises, and no
agreement to accept a surrender of the Premises or to terminate this Lease shall
be valid unless made in writing and signed by Landlord. No re-entry or taking
possession of the Premises by Landlord shall constitute an election by Landlord
to terminate this Lease, unless a written notice of such intention is given to
Tenant.  Notwithstanding any such reletting or re-entry or taking possession,
Landlord may at any time thereafter terminate this Lease for a previous default.
Landlord's acceptance of Rental. following an event of default hereunder shall
not be construed as a waiver of such event of default.  No waiver by Landlord of
any breach of this Lease shall constitute a waiver of any other violation or
breach of any time of the terms hereof. Forbearance by Landlord to enforce one
or more of the remedies herein provided upon a breach hereof shall not
constitute a waiver of any other breach of the Lease.

Section 24.04.  No provision of this Lease shall be deemed to have been waived
--------------
by Landlord unless such waiver is in writing and signed by Landlord. Nor shall
any custom or practice which may evolve between the parties in the
administration of the terms of this Lease be construed to waive or lessen
Landlord's right to insist upon strict performance of the terms of this Lease.
The rights granted to Landlord in this Lease shall be cumulative of every other
right or remedy which Landlord may otherwise have at law or in equity or by
statue, and the exercise of one or more rights or remedies shall not prejudice
or impair the current or subsequent exercise of other rights or remedies.

                                      -19-
<PAGE>

                                  ARTICLE 25

                               Waiver by Tenant
                               ----------------

To the extent permitted by applicable law, Tenant waives for itself and all
claiming by, through, and under it, including creditors of all kinds

     (a)  any right and privilege which it or any of them may have under any
          present or future constitution, statute, or rule of law to redeem the
          Premises or to have a continuance of this Lease for the Term after
          termination of Tenant's right of occupancy by order or judgment of any
          court or by any legal process or writ, under the terms of this Lease,
          or after the termination of the Term as herein provided,

     (b)  the benefits of any present or future constitution, statute, or rule
          of law which exempts property form liability for debt or for distress
          for rent, and

     (c)  the provisions of law relating to notice and/or delay in levy of
          execution in case of eviction of a Tenant for non-payment of rent.

                                  ARTICLE 26

                               Security Deposit
                               ----------------

The Security Deposit shall be held by Landlord, without interest, as security
for the performance of Tenant's obligations under this Lease. Landlord may,
without prejudice to any other remedy, use the Security Deposit to remedy any
default in. any obligation of Tenant hereunder, and such use shall survive the
termination of this Lease, and Tenant shall promptly, on demand, restore the
Security Deposit to its original amount. If Tenant is not in default at the
termination of this Lease, any remaining portion of the Security Deposit shall
be returned to Tenant.  If Landlord transfers its interest in the Premises
during the Term, Landlord shall assign the Security Deposit to the transferee
who shall then become obligated to Tenant for its return, and thereafter
Landlord shall have no further liability for its return.

                                  ARTICLE 27

                      Attorney's Fees and Legal Expenses
                      ----------------------------------

In any action or proceeding brought by either party against the other with
respect to this Lease, the prevailing party shall be entitled to recover from
the other party's reasonable attorneys' fees, investigation costs, and other
legal expenses and court costs incurred by such party in such action or
proceeding as the court may find to be reasonable. The prevailing party shall be
the one who receives the net judgment in its behalf at the end of any action.

                                      -20-
<PAGE>

                                  ARTICLE 28

                                    Notices
                                    -------

Any notice or document required to be delivered hereunder shall be considered
delivered, whether actually received or not, when hand delivered to the address
of the other party, or 48 hours after deposited in the United States Mail,
postage prepaid, registered or certified mail, return receipt requested,
addressed to the parties hereto at the respective addresses specified in the
Basic Lease Information, or at such other address as they have subsequently
specified by written notice.

                                  ARTICLE 29

                                 Miscellaneous
                                 -------------

Section 29.01.  Where this Lease requires Tenant to reimburse Landlord the cost
--------------
of any item, if no such cost has been stipulated, such cost will be the
reasonable and customary charge therefor periodically established by Landlord.
Failure to pay any such cost shall be considered as a failure to pay Rental.

Section 29.02.  Tenant represents and warrants that it has had no dealings with
--------------
any broker or agent in connection with the negotiation or execution of this
Lease except such brokers or agents as may be identified in Item 23 of the Basic
Lease Information. Tenant shall indemnify and hold Landlord harmless from any
costs, expenses, or liability for commission or other compensation or charges
claimed by any person, broker or agent (other than those identified in the Basic
Lease Information), claiming through association with Tenant with respect to
this Lease.

Section 29.03.  As used herein, the terms "business days" means Monday through
--------------
Friday (except for holidays); "normal business hours" means 7:00 a.m. to 6:00
p.m. on business days; and "holidays" means those holidays designated by
Landlord which holidays shall be consistent with those holidays designated by
Landlords of comparable office Buildings in the immediate area and town.

Section 29.04.  Every agreement contained in this Lease is, and shall be
--------------
construed as, a separate and independent agreement. If any term of this Lease or
the application thereof to any person or circumstances shall be invalid and
unenforceable, the remainder of this Lease, or the application of such term to
persons or circumstances other than those as to which it is invalid or
unenforceable, shall not be affected.

Section 29.05.  There shall be no merger of this Lease or of the Leasehold
--------------
estate hereby created with the fee estate in the Premises or any part thereof by
reason of the fact that the same person may acquire or hold, directly or
indirectly, this Lease or the Leasehold state hereby created or any interest in
this Lease or in any interest in such fee estate. In the event of a voluntary or
other surrender of this Lease, or a mutual cancellation hereof, Landlord may, at
its option, terminate all subLeases, or treat such surrender or cancellation as
an assignment of such subLeases.

                                      -21-
<PAGE>

Section 29.06.  Any liability of Landlord to Tenant under the terms of this
--------------
Lease shall be limited to Landlord's interest in. the Building and. the Land,
and Landlord shall not be personally liable for any deficiency.

Section 29.07.  Whenever a period of time is herein prescribed for action,
--------------
other than the payment of money, to be taken by either party hereto, such party
shall not be liable or responsible for, and there shall be excluded from the
computation for any such period of time, any delays due to strikes, riots, acts
of God, shortages of labor or materials, war, governmental laws, regulations, or
restrictions, or any other cause of any kind whatsoever which is beyond the
control of such party.

Section 29.08.  The article headings contained in this Lease are for
--------------
convenience only and shall not enlarge or limit the scope or meaning of the
various and several articles hereof.  Words of any gender used in this Lease
shall include any other gender, and words in the singular number shall be held
to include the plural, unless the context otherwise requires.

Section 29.09.  If there be more than one Tenant, the obligations hereunder
--------------
imposed Tenant shall be joint and several, and all agreements and covenants
herein contained shall be binding upon the respective heirs, personal
representatives, successors, and to the extent permitted under this Lease,
assigns of the parties hereto. If there is a guarantor of Tenant's obligations
hereunder, Tenant's obligations shall be joint and several obligations of Tenant
and such guarantor, and Landlord need not first proceed against Tenant hereunder
before proceeding against such guarantor, nor shall any such guarantor be
released from its guarantee for any reason including without limitation, any
amendment, renewal, expansion or diminution of this Lease, any forbearance by
Landlord or waiver of any of Landlord's rights, the failure to give Tenant or
such guarantor any notices, or the release of any party liable for the payment
of Tenant's obligations hereunder.

Section 29.10.  Neither Landlord nor Landlord's agents or brokers have made any
--------------
representations or promises with respect to the Premises or the Building except
as herein expressly set forth and all reliance with respect to any
representations or promises is based solely on those contained herein.

Section 29.11.  This Lease sets forth the entire agreement between the parties
--------------
and cancels all prior negotiations, arrangements, brochures, agreements, and
understandings, if any, between Landlord and Tenant regarding the subject matter
of this Lease. No amendment or modification of this Lease shall be binding or
valid unless expressed in a writing executed by both parties hereto.

Section 29.12.  The submission of this Lease to Tenant shall not be construed as
--------------
an offer, nor shall Tenant have any rights with respect thereto unless Landlord
executes a copy of this Lease and delivers the same to Tenant.

Section 29.13.  If Tenant signs as a corporation, each of the persons executing
--------------
this Lease on behalf of Tenant represents and warrants that Tenant is a duly
organized and existing corporations that Tenant has and is qualified to do
business In the Commonwealth of Pennsylvania, that the corporation has full
right and authority to enter into this Lease, and that all

                                      -22-
<PAGE>

persons signing on behalf of the corporation were authorized to do so by
appropriate corporation actions. If Tenant signs as a partnership, trust, or
other legal entity, each of the persons executing this Lease on behalf of Tenant
represents and warrants that Tenant has complied with all applicable laws,
rules, and governmental regulations relative to its right to do business in the
Commonwealth of Pennsylvania, that such entity has the full right and authority
to enter into this Lease, and that all persons signing on behalf of the Tenant
were authorized to do so by any and all necessary or appropriate partnership,
trust, or other actions.

Section 29.14.  If, in connection with obtaining financing for the Building or
--------------
of any ground or underlying Lease, any lender shall request reasonable
modifications in the Lease as a condition for such financing, Tenant will not
unreasonably withhold, delay, or defer its consent thereto, provided that such
modifications do not increase the obligations of Tenant hereunder or materially
adversely affect either the Leasehold interest hereby created or Tenant's use
and enjoyment of the Premises.

Section 29.15.  This Lease shall be governed by and construed under the laws of
--------------
the Commonwealth of Pennsylvania.  Any action brought to enforce or interpret
this Lease shall be brought in the court of appropriate jurisdiction in
Cumberland County, Pennsylvania.  Should any provision of this Lease require
judicial interpretation, it is agreed that the Court interpreting or considering
same shall not apply the presumption that the terms hereof shall be more
strictly construed against a party by reason of the rule or conclusion that a
document should be construed more strictly against the party who itself or
through its agent prepared the same, it being agreed that all parties hereto
have participated in the preparation of this Lease and that legal counsel was
consulted by each party before the execution of this Lease.

Section 29.16.  Any elimination or shutting off of light, air, or view by any
--------------
structure which may be erected on lands adjacent to the Building, modification
of the amenities to the Building shall in no way affect this Lease or impose any
liability on Landlord.

Section 29.17.  Landlord may, upon reasonable notice (except in the case of
--------------
emergencies) enter upon the Premises at reasonable hours to inspect same or
clean or make repairs or alterations (but without any obligation to do so,
except as expressly provided for herein) and to show the Premises and to show
the Premises to prospective lenders or purchasers, and, during the last 6 months
of the Term of the Lease, to show them to prospective Tenants at reasonable
hours and, if they are vacated, to prepare them for re-occupancy. Landlord shall
cause its officers, agents and representatives to exercise care with any such
entry not to unreasonably interfere with the operation and normal office routine
of Tenant (except in the case of emergency).

Section 29.18.  Landlord may elect to relocate Tenant to other space in the
--------------
Building containing at least the same amount of Rentable Area as contained in
the Premises (`Substitution Space). If such relocation occurs, the description
of the Premises set forth in this Lease shall, without farther act on the part
of Landlord or Tenant, be deemed amended so that the Substitution Space shall be
deemed the Premises hereunder, and all of the terms, covenants, conditions and
provisions of this Lease shall continue in full force and effect and shall apply
to the Substitution Space. The cost of relocating Tenant and altering the
Substitution Space to make it comparable to the Premises shall be borne by
Landlord The Annual Base Rental for the Substitution Space shall be the amount
specified under item 14 of the Basic Lease Information.

                                      -23-
<PAGE>

Section 29.19.  The exhibits and numbered riders attached to this Lease are by
--------------
this reference incorporated fully herein. The term "this Lease" shall be
considered to include all such exhibits and riders.

IN WITNESS WHEREOF, Landlord and Tenant have set their hands and seals to this
Lease Agreement the day and year first above written.

                                    Landlord:

                                    Old Gettysburg Associates
                                    a Pennsylvania general partnership

Witness: Linda L. Kilmore           By: Michael E. Salerno
        -----------------------        --------------------------
                                          Michael E. Salerno
                                          Agent for Owner

                                    Tenant:

                                    Select Medical Corporation
                                    a Delaware Corporation

Attest:  Michael Tarvin             By: Scott A. Romberger
        -----------------------        --------------------------
          Michael Tarvin                  Scott A. Romberger
          Secretary                       Vice President

                                      -24-
<PAGE>

                               TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                     Page
                                                                                     ----
<S>                                                                                  <C>
ARTICLE 1  PREMISES...............................................................      1
ARTICLE 2  TERM...................................................................      1
ARTICLE 3  DELIVERY OF THE PREMISES TO TENANT.....................................      2
ARTICLE 4  ACCEPTANCE OF THE PREMISES AND BUILDING BY TENANT......................      2
ARTICLE 5  RENTAL.................................................................      3
ARTICLE 6  OPERATING EXPENSES.....................................................      3
ARTICLE 7  SERVICES BY LANDLORD...................................................      6
ARTICLE 8  UTILITIES..............................................................      6
ARTICLE 9  USE....................................................................      8
ARTICLE 10 LAWS, ORDINANCES AND REQUIREMENTS OF PUBLIC AUTHORITIES................      8
ARTICLE 11 OBSERVANCE OF RULES AND REGULATIONS....................................      9
ARTICLE 12 ALTERATIONS............................................................      9
ARTICLE 13 LIENS..................................................................      9
ARTICLE 14 ORDINARY REPAIRS.......................................................     10
ARTICLE 15 INSURANCE..............................................................     10
ARTICLE 16 DAMAGE BY FIRE OR OTHER CAUSE..........................................     12
ARTICLE 17 CONDEMNATION...........................................................     13
ARTICLE 18 ASSIGNMENT AND SUBLETTING..............................................     13
ARTICLE 19 INDEMNIFICATION........................................................     14
ARTICLE 20 SURRENDER OF THE PREMISES..............................................     15
ARTICLE 21 ESTOPPEL CERTIFICATES..................................................     16
ARTICLE 22 SUBORDINATION..........................................................     16
ARTICLE 23 PARKING................................................................     17
ARTICLE 24 DEFAULT AND REMEDIES...................................................     17
ARTICLE 25 WAIVER BY TENANT.......................................................     20
ARTICLE 26 SECURITY DEPOSIT.......................................................     20
ARTICLE 27 ATTORNEY'S FEES AND LEGAL EXPENSES.....................................     20
ARTICLE 28 NOTICES................................................................     21
ARTICLE 29 MISCELLANEOUS..........................................................     21
</TABLE>

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