Document:

<PAGE>

                                                                   Exhibit 10.16

       THIS FIRST AMENDATORY LEASE AGREEMENT made this 27/th/ day of June, 2001,
by and between (ELDERSBURG BUSINESS CENTER, INC.) MERRITT-ELI, LLC, (hereinafter
called "Landlord") and DAL-TILE CORPORATION, (hereinafter called "Tenant").
Subsequently, the interest of Eldersburg Business Center, Inc. under the Lease
was assigned to MERRITT-ELI, LLC.

                              EXPLANATORY STATEMENT
                              ---------------------

       By lease (hereinafter called the "Lease") dated January 16, 1997,
Landlord leased to Tenant, and the latter rented from the former, certain
premises within the building known as 1470 Progress Way, Suites 701-725,
Eldersburg, MD 21784.  Pursuant to Section 48, Tenant desires to expand its
premises.  In accordance with Section 48, the parties desire to amend the Lease
as hereinafter set forth.

       NOW, THEREFORE, AND IN CONSIDERATION of the mutual covenants and
agreement herein contained, the parties hereto hereby covenant and agree as
follows:

                1.  Landlord and Tenant agree to expand Tenant's premises to
                    include 1470 Progress Way, Suites 726-729, Eldersburg, MD
                    21784 ("Expansion Premises") which represents 41,400 square
                    feet, for a period of sixty-six (66) months, commencing
                    August 1, 2001 and expiring February 28, 2007. Tenant's
                    premises shall be known as 1470 Progress Way, Suites
                    701-729, Eldersburg, MD 21784, which represents 356,400
                    square feet.

                2.  Landlord shall provide an allowance of up to twenty thousand
                    seven hundred dollars ($20,700.00) for improvements to the
                    Expansion Premises.

                3.  Landlord shall provide all electrical, plumbing and
                    mechanical systems in good working order upon occupancy.
                    Landlord shall provide two (2) openings through the demising
                    wall to the premises and shall combine the electric services
                    at Landlord's expense. Landlord shall be under no obligation
                    to perform any other work at Landlord's expense.

<PAGE>

        4. The rental rate for the total square footage shall be as follows:
           ---------------------------------------------------------------------
               Term             Annual Rate:       Monthly Rate:   Per Sq. Ft.:
           ---------------------------------------------------------------------
            8/1/01 - 2/28/02        N/A            $ 95,634.00        $3.22
           ---------------------------------------------------------------------
            3/1/02 - 2/28/03    $1,168,992.00      $ 97,416.00        $3.28
           ---------------------------------------------------------------------
            3/1/03 - 2/28/04    $1,193.940.00      $ 99,495.00        $3.35
           ---------------------------------------------------------------------
            3/1/04 - 2/28/05    $1,218.888.00      $101,574.00        $3.42
           ---------------------------------------------------------------------
            3/1/05 - 2/28/06    $1,240,272.00      $103,356.00        $3.48
           ---------------------------------------------------------------------
            3/1/06 - 2/28/07    $1,265,220.00      $105,435.00        $3.55
           ---------------------------------------------------------------------

        5. Tenant's pro-rata share shall increase from 74.19% to 83.90%
           effective August 1, 2001.

        6. Tenant's cancellation fee referenced in Section 42 of the Lease shall
           be increased to three hundred ninety-nine thousand ninety-six dollars
           and sixty-eight cents ($399,096.68).

        7. Except as herein provided, the Lease shall remain unchanged and in
           full force and effect.

        8. Time is of the essence for all purposes in this Amendatory Lease
           Agreement.

    IN WITNESS WHEREOF, the parties hereto have executed the within Amendatory
Lease Agreement as of the day and year first above written.

WITNESS:                                   DAL-TILE CORPORATION

/s/ [ILLEGIBLE]                            BY: /s/ [ILLEGIBLE]   (SEAL)
---------------------                          ------------------
                                                Tenant Vice President

                                           MERRITT-ELI, LLC
ATTEST:                         BY: MERRITT MANAGEMENT CORPORATION AGENT

/s/ [ILLEGIBLE]                            BY: /s/ [ILLEGIBLE]   (SEAL)
---------------------                          ------------------
                                                   Landlord

<PAGE>

[LOGO OF MERRITT]
--------------------------------------------------------------------------------
INDUSTIAL . COMMERCIAL . OFFICE BUILDINGS

March 7, 1997

CERTIFIED, RETURN RECEIPT REQUESTED

Dal-Tile Corporation
7834 Hawn Freeway
P.O. Box 17130
Dallas, Texas 75217

ATTN: Real Estate Department

Re: Commencement of Lease

Ref: 1470 Progress Way, Eldersburg, MD 21784

        ACCOUNT #EL1240
        ---------------

Dear Sir/Madam:

Per the terms of your lease dated January 16, 1997, by and between Eldersburg
Business Center, Inc. and Dal-Tile Corporation, I would like to confirm the
following:

- Lease Term Commencement Date: March 1, 1997

- Lease Term Termination Date: February 28, 2007

- Rent Commencement Date: March 1, 1997

As the original term of the Lease is for ten (10) years, the above termination
date supersedes that of February 28, 2006, as originally stated in the Lease.

- Monthly Minimum Rent for Initial Term:
*March 1, 1997 - February 28, 1998: $75,075.00
*March 1, 1998 - February 28, 1999: $77,327.25
*March 1, 1999 - February 28, 2000: $79,647.07
*March 1, 2000 - February 28, 2001: $82,036.48
*March 1, 2001 - February 28, 2002: $84,497.57
*March 1, 2002 - February 28, 2003: $86,187.52
*March 1, 2003 - February 28, 2004: $87,911.27
*March 1, 2004 - February 28, 2005: $89,669.50
*March 1, 2005 - February 28, 2006: $91,462.89
*March 1, 2006 - February 28, 2007: $93,292.15

Please acknowledge by signing the duplicate copy where indicated and return to
my attention in the enclosed envelope within ten (10) days of the date of this
letter. Also, please be sure to fill in the section at the bottom of the
signature page with the name and phone of the person we can contact after
business hours should there be an emergency.

All rental payments are due in our office by the first day of each month. Please
be advised that Landlord

    2066 Lord Baltimore Drive . Baltimore, Maryland . 21244 . (410) 298-2600
                               FAX (410) 298-9644

<PAGE>

Dal-Tile Corporation
March 7, 1997
Page 2

does not send out monthly invoices. Your check should be made payable to
Eldersburg Business Center, Inc. and mailed to same at 2066 Lord Baltimore
Drive, Baltimore, MD 21244. Also, kindly reference the above account number on
your check.

If you have not done so already, please contact BGE at (410) 685-0123 and have
the electric service placed in your name effective as of your commencement
date being March 1, 1997. This can be done retractively and if you fail to
contact BGE, you run the risk of having your service interrupted.

Please return the following items to my attention with the acknowledgment of the
above:

- The enclosed Tenant Emergency Card
- A Certificate of Insurance showing current coverage as outlined in Section 8
  of your lease
- A copy of your HVAC Maintenance Agreement as required under Section 11 of your
  lease

Regarding the HVAC Maintenance Agreement, I am enclosing a proposal for the
maintenance required. Merritt has Certified HVAC Technicians on staff and we
offer a full service Maintenance Agreement at a below market rate that not only
covers all parts and labor but also guarantees the HVAC unit for the term of you
lease and any extension(s). If you would like to accept our proposal, please
sign both copies and return one along with payment to the attention of Josie
Kaminiski. Please feel free to contact Josie with any questions you may have
regarding the proposal.

Sincerely,

ELDERSBURG BUSINESS CENTER, INC.

BY  MERRITT MANAGEMENT CORPORATION
    AGENT FOR ELDERSBURG BUSINESS CENTER, INC.

/s/ Beth Meuche

Beth Meuche

enclosure

AGREED TO AND ACKNOWLEDGED THIS 21 DAY OF MARCH, 1997
                               ---        -----

WITNESS                        DAL-TILE CORPORATION

                               /s/ [ILLEGIBLE]
                               --------------------(SEAL)

EMERGENCY CONTACT PERSON AFTER BUSINESS HOURS:
----------------------------------------------

---------------------------       -----------------------
NAME (PLEASE PRINT)               PHONE

cc: 1470 Progress Way
    Eldersburg, MD 21784
    District Manager

<PAGE>

                      TABLE OF CONTENTS FOR LEASE BETWEEN

                   ELDERSBURG BUSINESS CENTER, INC., LANDLORD

                         DAL-TITLE CORPORATION, TENANT.

1.  PAYMENT OF RENTAL .........................................................2

2.  USE .......................................................................2

3.  UTILITIES .................................................................2

4.  COMPLIANCE WITH LAWS ......................................................3

5.  ASSIGNMENT AND SUBLETTING .................................................4

6.  LOADING CAPACITY ..........................................................5

7.  INCREASE IN LANDLORD'S INSURANCE RATES.....................................5

8.  INSURANCE - INDEMNITY .....................................................5

9.  ALTERATIONS ...............................................................8

10. OWNERSHIP OF ALTERATIONS ..................................................8

11. REPAIRS AND MAINTENANCE ...................................................8

12. OPERATING COSTS ..........................................................10

13. DEFAULT ..................................................................12

14. DAMAGE OR DESTRUCTION ....................................................14

15. POSSESSION ...............................................................15

16. EXTERIOR OF PREMISES - SIGNS .............................................15

17. RELOCATION ...............................................................16

18. FOR RENTAL/SALE SIGNS ....................................................16

19. WATER AND OTHER DAMAGE ...................................................16

20. RIGHT OF ENTRY ...........................................................16

21. TERMINATION OF TERM ......................................................16

22. CONDEMNATION .............................................................17

23. SUBORDINATION ............................................................18

24. LANDLORD'S RIGHT TO PERFORM TENANT'S COVENANTS ...........................18

25. ATTORNMENT ...............................................................19

26. NON-WAIVER OF FUTURE ENFORCEMENT .........................................20

27. PERSONAL PROPERTY TAXES ..................................................20

28. RECORDATION OF LEASE .....................................................20

29. NOTICES ..................................................................21

30. WAIVER OF JURY TRIAL .......................Section intentionally deleted

                                       1

<PAGE>

31. SEVERABILITY ..........................................................   21

32. NON-WAIVER ............................................................   22

33. SUCCESSORS AND ASSIGNS ................................................   22

34. NOTICES TO MORTGAGEE ..................................................   22

35. ESTOPPEL CERTIFICATE ..................................................   23

36. ENVIRONMENTAL PROVISIONS ..............................................   23

37. CAPTIONS ..............................................................   25

38. FINAL AND ENTIRE AGREEMENT ............................................   25

39. TENANT REPRESENTATIVE .................................................   25

40. ADDITIONAL RENT .......................................................   25

41. LANDLORD'S WORK .......................................................   26

42. CANCELLATION OPTION ...................................................   26

43. LANDLORD'S GUARANTEE ..................................................   26

44. CONSENT ...............................................................   26

45. RIGHT OF FIRST OFFER FOR CONTIGUOUS SPACE .............................   27

46. NON-DISTURBANCE .......................................................   27

47. TENANT FENCE ..........................................................   28

48. EXPANSION .............................................................   28

49. RENEWAL OPTIONS .......................................................   28

                                       2

<PAGE>

month of the term to the date the term ends shall be prorated and shall be
payable on the first day of the last month of the term.

          All rentals shall be paid to Landlord at 2066 Lord Baltimore
Drive, Baltimore, Maryland 21244, or at such other place or to such appointee of
the Landlord as the Landlord may from time to time designate in writing.

          This Lease is made subject to the following additional terms,
covenants and conditions:

     1.   Payment of Rental.

Tenant covenants and agrees to pay the rental herein reserved and each
installment thereof promptly when and as due, without setoff or deduction
whatsoever. Tenant further agrees that it will not prepay rent more than one (1
month in advance without Landlord's prior written consent.

     2.   Use.

Tenant covenants and agrees to use and occupy the Premises solely for the
following purposes:
          STORAGE, DISTRIBUTION, AND RELATED OFFICE, AND ANY OTHER USE PERMITTED
          UNDER THE EXISTING ZONING.

Tenant agrees to comply with all applicable zoning and other laws and
regulations, and provide and install at its own expense any additional equipment
or alterations required to comply with all such laws and regulations as
required from time to time; provided, however, in any non-compliance by Tenant
which does not have an adverse effect on the Premises shall not be deemed a
breach of this lease. Tenant will not permit, allow or cause any public or
private auction sales or sheriffs' or constables' sales to be conducted on or
from the Premises.

     3.   Utilities.

          (a) Tenant agrees to pay as additional rent Tenant's pro rata share of
the water rent and sewer service charges chargeable to the total building in
which the Premises are located, based upon the size of the Premises in
proportion to the total square footage of the building, which sum shall be due
within fifteen (15) days after Landlord's written demand. However, if in
Landlord's reasonable judgment, the water and sewer charges for the Premises are
substantially higher than normal due

                                        2

<PAGE>

          THIS LEASE, made this 16/th/ day of January, 1997, by and between
ELDERSBURG BUSINESS CENTER, INC., hereinafter called "Landlord," and DAL-TILE
CORPORATION, hereinafter call "Tenant."

          WITNESSETH, that in consideration of the rental hereinafter agreed
upon and the performance of all the conditions and covenants hereinafter set
forth on the part of the Tenant to be performed, the Landlord does hereby lease
unto the said Tenant, and the latter does lease from the former the following
Premises (hereinafter sometimes called the "Premises"):

          BEING those Premises outlined in red on the Plat attached hereto as
     Exhibit A, said Premises being located within the building known as 1470
     Progress Way, Eldersburg, MD 21784; 315,000 square feet; (Building)

for the term of ten (10) years, beginning on the first day of March 1997, and
ending on the last day of February, 2006, at and for the annual rental as
follows:

     Terms:      Annually:          Monthly:         Per S.F.:
     ------      ---------          --------         ---------
     Year 1      $  900,900.00      $75,075.00       $2.86
     Year 2      $  927,927.00      $77,327.25       $2.95
     Year 3      $  955,764.84      $79,647.07       $3.03
     Year 4      $  984,437.76      $82,036.48       $3.13
     Year 5      $1,013,970.84      $84,497.57       $3.22
     Year 6      $1,034,250.24      $86,187.52       $3.28
     Year 7      $1,054,935.24      $87,911.27       $3.35
     Year 8      $1,076,034.00      $89,669.50       $3.42
     Year 9      $1,097,554.68      $91,462.89       $3.48
     Year 10     $1,119,505.80      $93,292.15       $3.55

     *    Notwithstanding the above, Tenant will receive a total rent credit in
the amount of Ninety Thousand Dollars ($90,000.00) which shall be applied at a
rate of Thirty Thousand Dollars ($30,000.00) per month for the first three (3)
months of the first year of the lease term.

Payable in advance on the first day of each and every month during the term of
this Lease, in equal monthly installments each, without setoff or deduction
whatsoever. If the term of this Lease shall commence on a date other than the
first day of a month, the rental for the period from the date of commencement of
the term to the first day of the first full calendar month of the term shall be
prorated and shall be payable on the first day of the term; if the term of this
Lease shall end on a date other than the last day of a month, the rent for the
period from the first day of the last

<PAGE>

to Tenant's water usage, the Landlord may install a water meter at Landlord's
expense and thereafter Tenant will pay all water charges for the Premises based
on such meter readings.

          (b)  Tenant shall also pay all costs of electricity, gas, telephone
and other utilities used or consumed on the Premises together with all taxes,
levies or other charges on such utilities. If Tenant defaults in payment of any
such utilities, charges or taxes, Landlord may, at its option, pay the same for
and on Tenant's account, in which event Tenant shall promptly reimburse Landlord
therefor.

          (c)  In addition, Tenant shall pay, as additional rent, 74.15% (being
the same percentage which the square foot floor area of the Premises bears to
the entire leasable area of the building) of Landlord's costs of public service
electric usage, including usage for lighting the parking and other common areas,
which sum shall be due within fifteen (15) days after Landlord's demand.

     4.   Compliance with Laws.

          (a)  Tenant covenants and agrees that it will, at its own expense,
observe, comply with and execute all laws, orders, rules, requirements and
regulations of any and all governmental departments, bodies, bureaus, agencies
and officers, and all rules, directions, requirements and recommendations of the
local board of fire underwriters and the fire insurance rating organizations
having jurisdiction over the area in which the Premises are situated, or other
bodies or agencies now or hereafter exercising similar functions in the area in
which the Premises are situated, in any way pertaining to the Premises or the
use and occupancy thereof, provided, however that any non-compliance by Tenant
which does not have an adverse effect on the Premises shall not be a breach of
this lease. In the event Tenant shall fail or neglect to comply with any of the
aforesaid laws, orders, rules, requirements or recommendations and any such
non-compliance does not have an adverse effect on the Premises, Landlord or its
agents may enter the Premises after providing written notice to Tenant and
Tenant has a thirty (30) day period to comply with any laws, orders, rules,
requirements or recommendations, and take all such action and do all such work
in or to the Premises as may be necessary in order to cause compliance with such
laws, orders, rules, requirements or recommendations, and Tenant covenants and
agrees to reimburse Landlord promptly upon demand for the expenses incurred by
Landlord in taking such action and performing such work.

          (b)  Without limiting the generality of paragraph (a) hereof, Tenant
shall at all times keep the Premises in compliance

                                       3

<PAGE>

with the Americans With Disabilities Act and its supporting regulations, and all
similar federal, state or local laws, regulations and ordinances. If Landlord's
consent would be required for alterations to bring the Premises into compliance,
Landlord agrees not to unreasonably withhold its consent.

     5.   Assignment and Subletting.

          (a)  Tenant covenants and agrees not to assign this Lease, in whole or
in part, nor sublet the Premises, or any part or portion thereof, nor grant any
license or concession for all or any part thereof, without the prior written
consent of the Landlord in each instance first had and obtained. If such
assignment or subletting is permitted, Tenant shall not be relieved from any
liability whatsoever under this Lease. In the event that the amount of the rent
or other consideration to be paid to the Tenant by any assignee or sublessee is
greater than the rent required to be paid by the Tenant to the Landlord pursuant
to this Lease, Tenant shall pay to Landlord one-half of any such excess, after
deducting Tenant's transaction and improvement costs, as is received by Tenant
from such assignee or sublessee. Any consent by Landlord to an assignment or
subletting of this Lease shall not constitute a waiver of the necessity of such
consent as to any subsequent assignment or subletting. An assignment for the
benefit of Tenant's creditors shall not be effective to transfer or assign
Tenant's interest under this Lease unless Landlord shall have first consented
thereto in writing.

          (b)  In the event this Lease contains a renewal option exercisable by
Tenant, Landlord's consent to an assignment or sublease of the Premises or any
portion thereof during the original Lease term shall be deemed to be conditioned
upon the agreement of Tenant and such assignee or sublessee that such renewal
right or option shall terminate and be of no further force or effect unless
Landlord's consent to such assignment or sublease expressly provides otherwise.
Consequently, unless so provided otherwise, any assignment or sublease during
the original Lease term shall automatically constitute a termination of the
right of Tenant or such assignee or sublessee to exercise any renewal option
contained herein.

          (c)  In the event Tenant desires to assign this Lease or to sublease
all or any substantial portion of the Premises, Landlord shall have the right
and option to terminate this Lease, which right or option shall be exercisable
by written notice from Landlord to Tenant within thirty (30) days from the date
Tenant gives Landlord written notice of its desire to assign or sublease.

                                       4

<PAGE>

     6.   Loading Capacity.

Tenant covenants and agrees not to load the Premises beyond its present carrying
or loading capacity, subject to the specifications set forth in Exhibit "A".

     7.   Increase in Landlord's Insurance Rates.

Tenant will not do, or suffer to be done, anything in or about the Premises, or
keep or suffer to be kept, anything in or about the Premises which will
contravene or materially affect any policy of insurance against loss by fire or
other hazards, including, but not limited to, public liability, now existing or
which will prevent the Landlord from procuring such policies in companies
acceptable to Landlord at standard rates.

     8.   Insurance - Indemnity.

          (a)  Tenant covenants and agrees that from and after the date of
delivery of the Premises from Landlord to Tenant, Tenant will carry and
maintain, at its sole cost and expense and in the amounts specified and in the
form hereinafter provided, the following types of insurance

                (i) Public Liability and Property Damage. General Public
                    ------------------------------------
     Liability Insurance covering the Premises and Tenant's use thereof against
     claims for personal injury or death and property damage occurring upon, in
     or about the Premises, such insurance to afford protection to the limit of
     not less than $2,000,000 arising out of any one occurrence, and against
     property damage to afford protection to the limit of not less than
     $2,000,000; or such insurance may be for a combined single limit of
     $2,000,000 per occurrence. The insurance coverage required under this
     Section 8(a)(i) shall, in addition, extend to any liability of Tenant
     arising out of Tenant's indemnities hereinafter provided, as well as
     Independent Contractors' Liability, Products/Completed Operations
     Liability, Personal Injury LIability and Contractual Liability.

               (ii)  Boilers. If Tenant's Premises shall contain a boiler or
                     -------
     other similar pressure vessel, Tenant shall carry Boiler and Machinery
     Insurance with a direct damage limit not less than the full value of the
     building in which Tenant's Premises are situated. Such insurance shall be
     written on a "repair and replacement" (replacement cost) basis.

               (iii) Tenant Improvements and Property. Insurance covering all
                     --------------------------------

     leasehold improvements and other improvements installed by Tenant upon the
     Premises, trade fixtures and personal property from time to time in, on or
     upon the

                                       5

<PAGE>

        Premises and any alterations, improvements, additions or changes made by
        Tenant thereto in an amount not less than one hundred percent (100%) of
        their full replacement cost from time to time during the Lease term,
        providing protection against perils included within the standard
        Maryland form of fire and extended coverage insurance policy, together
        with insurance against sprinkler leakage or other sprinkler damage,
        vandalism and malicious mischief.

                (iv) Plate Glass. Plate glass insurance covering all plate glass
                     -----------
        in the Premises. Tenant shall be and remain liable for the repair and
        restoration of all such plate glass.

            (b) All policies of insurance to be provided by Tenant shall be
issued in form acceptable to Landlord by insurance companies with general
policyholder's rating of not less than A and a financial rating of AAA as rated
in the most current available "Best's" Insurance Reports, and qualified to do
business in Maryland. A certificate of insurance, naming Landlord as additional
insured shall be delivered to Landlord within ten (10) days after delivery of
possession of the Premises to Tenant and thereafter at least fifteen (15) days
prior to the expiration of each such policy. As often as any such policy shall
expire or terminate, renewal or additional policies shall be procured and
maintained by Tenant in like manner and to like extent. All such policies of
insurance shall contain a provision that the company writing said policy will
give to Landlord at least thirty (30) days' notice in writing in advance of any
cancellations, or lapse, or the effective date of any reduction in the amounts
of insurance. In the event Tenant shall fail to promptly furnish any insurance
herein required, Landlord may after giving Tenant written notice effect the same
for a period not exceeding one (1) year and Tenant shall promptly reimburse
Landlord upon demand, as additional rent, the premium so paid by Landlord. If,
upon Tenant's failure, rather than purchase separate insurance coverage,
Landlord chooses to include Tenant's coverage under Landlord's insurance
policies, then Tenant shall promptly reimburse Landlord upon demand, as
additional rent, the greater of the increase in Landlord's premium resulting
therefrom or One Thousand Dollars ($1,000.00). All such public liability,
property damage and other casualty policies shall be written as primary policies
which do not contribute to and are not in excess of coverage which Landlord may
carry. All such public liability and property damage policies shall contain a
provision that Landlord shall damage policies shall contain a provision that
Landlord shall nevertheless be entitled to recover under said policies for any
loss occasioned to it, its servants, agents and employees by

                                       6

<PAGE>

reason of the negligence of Tenant or any other named assured. Any insurance
provided for may be affected by a policy or policies of blanket insurance,
covering additional items or locations; provided, however, that (i) Landlord
shall be named as an additional assured thereunder as its interests may appear;
(ii) the coverage afforded Landlord will not be reduced or diminished by reason
of the use of such blanket policy of insurance; (iii) any such policy or
policies (except any covering the risks referred to in paragraph [i]), shall
specify therein (or Tenant shall furnish Landlord with a written statement from
the insurers under such policy specifying) the amount of the total insurance
allocated to the "Tenant Improvements and Property" more specifically detailed
in paragraph (iii), above; and (iv) the requirements set forth herein are
otherwise satisfied. Any insurance policies herein required to be procured by
Tenant shall contain an express waiver of any right of subrogation by the
insurance company against the Landlord.

        (c) Tenant shall, and does hereby, indemnify and hold harmless Landlord
and any other parties in interest set forth in paragraph (b), above, from and
against any and all liabilities, fines, claims, damages and actions, costs and
expenses of any kind or nature (including attorneys' fees) and of anyone
whatsoever (i) relating to or arising from Tenant's use and occupancy of the
Premises, to the extent that Tenant's negligent acts or omissions are a
proximate cause of any such liabilities, fines, claims, damages, actions, costs
and expenses of any kind or nature (including attorneys fees), (ii) due to or
arising out of any mechanic's lien filed against the building, or any part
thereof, for labor performed or for materials furnished or claimed to be
furnished to Tenant, or (iii) due to or arising out of any breach, violation or
nonperformance of any covenant, condition or agreement in this Lease set forth
and contained on the part of Tenant to be fulfilled, kept, observed or
performed, unless such  damage or injury shall be occasioned by the
negligence or willful act or omission of the Landlord, and its agents in which
event, Landlord shall indemnify and hold harmless Tenant to the extent of such
negligence or willful act or omission. Notwithstanding the foregoing, Tenant
shall at all times remain liable for, and indemnify and hold harmless Landlord
as aforesaid against, any damage or injury arising from perils against which
Tenant is required by this Lease to insure regardless of the negligence or
willful act or omissions of others, to the extent that Tenant's negligent acts
or omissions are a proximate cause of any such damage or injury and only to

                                       7

<PAGE>

the extent of payments received pursuant to such insurance coverage.

        9.  Alterations.

Tenant shall not make alterations (other than non-structural interior
alterations or alterations whose cost is less than $5,000.00 in each instance)
to the Premises, or any part thereof, without prior written consent of Landlord
in each instance first had and obtained. If Tenant shall desire to make such
alterations, plans for the same shall first be submitted to and approved by
Landlord, and all work and installations shall be performed by Tenant at its own
expense in accordance with approved plans. Tenant agrees that all such work
shall be done in a good and workmanlike manner, that the structural integrity of
the building shall not be impaired, and that no liens shall attach to the
Premises by reason thereof. Tenant agrees to obtain, at Tenant's expense, all
permits required for such alterations.

        10. Ownership of Alterations.

Unless Landlord shall elect that all or part of any alteration made by Tenant to
the Premises (including any alteration consented to by Landlord pursuant to
paragraph 9 hereof) shall remain on the Premises after the termination of this
Lease, the Premises shall be restored to their original condition by Tenant
before the expiration of this Lease at Tenant's sole expense, excepting normal
wear and tear. Upon such election by Landlord, any such alterations,
improvement, betterments or mechanical equipment, including but not limited to,
heating and air conditioning systems, shall become the property of Landlord as
soon as they are affixed to the Premises, and all right, title and interest
thereof of Tenant shall immediately cease, unless otherwise agreed to in writing
by Landlord. Tenant shall promptly pay any franchise, minor privilege or other
tax or assessment resulting directly or indirectly from any alterations or
improvements made by Tenant to the Premises. Tenant shall repair promptly, at
its own expense, any damage to the Premises caused by bringing into the Premises
any property for Tenant's use, or by the installation or removal of such
property, regardless of fault or by whom such damage shall be caused.

        11. Repairs and Maintenance.

            (a) Except for the improvements provided by Landlord as set forth on
the attached Exhibit "A", the Premises hereby leased are leased to Tenant "as
is." Except as herein expressly provided, Landlord shall be under no liability,
nor have any

                                       8

<PAGE>

obligation to do any work or make any repairs in or to the Premises and any work
which may be necessary to outfit the Premises for Tenant's occupancy or for the
operation of Tenant's business therein is the sole responsibility of Tenant and
shall be performed by Tenant at its own cost and expense. Tenant acknowledges
that it has fully inspected the Premises prior to the execution of this Lease,
and Tenant further acknowledges that Landlord has made no warranties or
representations (other than the warranties and representations made by Landlord
as set forth in Section 11(d)) with respect to the condition or state of repairs
of the Premises.

          (b)  Tenant will, during the term of this Lease, keep the Premises and
appurtenances (including windows, doors, plumbing heating and electrical
facilities and installations) in good order and repair and will make all
necessary repairs thereof at its own expense, except that Landlord will make all
necessary repairs to the exterior masonry walls and roof of the Premises, after
being notified in writing by Tenant of the need for such repairs, and shall have
a reasonable time in which to complete such repairs. Tenant agrees to carry a
maintenance and/or service agreement or policy on the HVAC system in the demised
Premises. This agreement or policy shall be carried throughout the term of this
Lease and any renewals or extensions hereof. Tenant shall provide Landlord with
a copy of such policy or a certificate evidencing such coverage. In the event
that the repairs required to be made by Landlord are necessitated as a result of
negligence or misuse by Tenant, its agents, servants, employees, licensees or
guests, or by any contractor engaged by or on behalf of Tenant, such repairs
shall be made by and be paid for by Tenant. Tenant will, at the expiration of
the term or at the sooner termination thereof by forfeiture or otherwise,
deliver up the Premises in the same good order and condition as they were at the
beginning of tenancy, reasonable wear and tear excepted. Tenant further agrees
that it will maintain the Premises at its own expense in a clean, orderly and
sanitary condition, free of insects, rodents, vermin, and other pests; and that
it will not permit undue accumulation of garbage, trash, rubbish or other
refuse, but will remove the same at its own expense and will keep such refuse in
proper containers within the interior of the Premises until called for to be
removed. Except as provided for in paragraph 9 herein, Tenant further agrees
that it will not install any additional electrical wiring or plumbing unless it
has first obtained Landlord's written consent thereto, and, if such consent is
given, Tenant will install the same at its own cost and expense, and Tenant
shall

                                       9

<PAGE>

obtain, at Tenant's expense, all permits required for such installation.

        (c)  In the event Tenant shall not proceed promptly and diligently to
make any repairs or perform any obligation imposed upon it by subparagraphs (a)
and (b) hereof within thirty (30) days after receiving written notice from
Landlord to make such repairs or perform such obligation, then and in such
event, Landlord may, at its option, enter the Premises and do and perform the
things specified in said notice, and Tenant agrees to pay promptly upon demand
any cost or expense incurred by Landlord in taking such action.

        (d)  Notwithstanding the provisions of paragraph 11, Landlord represents
that at the commencement of the lease the Site to include any paved areas, the
Building and all operating systems to include the roof, electrical, mechanical,
plumbing and sprinkler systems, are in a good state of repair and condition and
are in compliance with all applicable building codes, rules and regulations.
Landlord represents that the condition of the aforementioned systems will comply
with the specifications set forth on Exhibit "A".

    12. Operating Costs.

        (a)  "Operating Costs" are the costs of operating, maintaining,
repairing, redecorating, refurbishing and insuring the building in which the
Premises is situate: together with all common areas and facilities within the
property herein described (collectively "the Building and Common Areas")
including, but not limited to, stairwells, loading areas, parking areas,
pavements and walkways, landscaping, gardening, storm drainage, and other
utility systems; the cost of utilities for the Building and Common Areas and
facilities; fire protection and security services, if any; traffic control
equipment; repairs; parking lot striping; lighting; sanitary control; removal of
snow, trash, rubbish, garbage and other refuse; depreciation on or rentals of
machinery and equipment used exclusively in such maintenance; the pro-rata cost
of personnel to implement such services; all insurance of whatsoever nature
kept, or caused to be kept, by Landlord out of or in connection with the
ownership of the Building and Common areas, including, but not limited to,
insurance insuring the same against loss or damage by, or abatement of rental
income resulting from, fire and other such hazards, casualties, and
contingencies, and liability and indemnity insurance. Such costs shall not
include;

        (i)  Landlord's management and office overhead costs:

                                       10

<PAGE>

          (ii)  the cost of any capital improvements to the Building as
determined under generally accepted accounting principles or

          (iii) work which Landlord performs specifically for or at the expense
of any tenant of the Building. "Operating Costs" shall also include all taxes
(as hereinafter defined) assessed against the Building and Common Areas, whether
as a result of an increase in the tax rate, or the levy, assessment or
imposition of any tax on real estate as such not now levied, assessed or
imposed. The foregoing shall apply to increases in real estate taxes assessed
against the Building and Common Areas generally, and not resulting from
improvements placed thereon by Tenant. In the event of any increases in real
estate taxes resulting from improvements, alterations or additions made by
Tenant, Tenant shall pay the entire amount of said increase. "Taxes" as used
herein shall also include, but not by way of limitation, all paving taxes,
special paving taxes, Metropolitan District Charges, and any and all other
benefits or assessments which may be levied on the Building and Common Areas,
but shall not include any income tax on the income or rent payable hereunder.
"Taxes" shall also include all reasonable expenses incurred by Landlord
(including attorneys' fees and costs) in contesting any increase in, or applying
for any reduction of, a tax assessment only to the extent of any reduction.

          (b)  Tenant shall pay Landlord, as additional rent, an amount equal to
Tenant's "Proportionate Share" (as hereinafter defined) of all Operating Costs
during the Lease term, and any renewal term thereof. As used herein, Tenant's
"Proportionate Share" shall be seventy-four and fifteen hundredths percent
(74.15%), which is the same percentage which the leasable area of the Premises
bears to the total leasable area of the Building.

          (c)  Landlord shall notify Tenant from time to time of the amount
which Landlord estimates will be the amount payable by Tenant in accordance with
paragraph (b), above, and Tenant shall pay such amounts to Landlord in equal
monthly installments, in advance, on the first day of each month, simultaneously
with payments of the base rent reserved hereunder. Within a reasonable period of
time following the end of each annual period of the term, Landlord shall submit
to Tenant a statement showing the actual amounts incurred by Landlord as set
forth in paragraph (b), the amount theretofore paid by Tenant, and the amount of
the resulting balance due thereon, or overpayment thereof, as the case may be.
In the event any balance may be due by Tenant, Tenant shall pay said balance
within thirty (30) days from the date of such statement. In the event Tenant has
made any overpayment,

                                       11

<PAGE>

such overpayment shall be credited by Landlord against the next installment or
installments of rent which are due and payable hereunder, or if the term of this
Lease has expired, such overpayment shall be refunded by Landlord to Tenant,
without interest, within thirty (30) days after the date of such statement. Each
such statement submitted by Landlord shall be final and conclusive between the
parties hereto as to the matters therein set forth, if no objection is raised
with respect thereto within thirty (30) days after submission of each such
statement.

     13. Default.

         (a)   Any of the following events shall constitute a default by Tenant:

               (i)   If the rent (basic or additional) shall be in arrears for a
     period of ten (10) days following receipt of written notice from Landlord,
     in whole or in part; or

               (ii)  If Tenant shall have failed to perform any other term,
     condition, or covenant of this Lease on its part to be performed for a
     period of thirty (30) days after notice of such failure from Landlord and
     Tenant is not diligently pursuing the cure of such default; or

               (iii) If the Premises are vacant, unoccupied or deserted for a
     period of thirty (30) days or more at any time during the term; or

               (iv)  If Tenant is adjudicated a bankrupt or insolvent by any
     court of competent jurisdiction, or if any such court enters an order,
     judgment or decree finally approving any petition against Tenant seeking
     reorganization, liquidation, dissolution or similar relief or if a
     receiver, trustee, liquidator or conservator is appointed for all or
     substantially all of Tenant's assets and such appointment is not vacated
     within ten (10) days after the appointment, or if Tenant seeks or consents
     to any of the relief hereinabove enumerated in this subparagraph (iv) or
     files a voluntary petition in bankruptcy or insolvency or makes an
     assignment of all or substantially all of its assets for the benefit of
     creditors or admits in writing of its inability to pay its debts generally
     as they come due or files Articles of Dissolution, or similar writing
     indicating its intention to wind up or liquidate its business, with the
     appropriate authority of the place of its incorporation; or

               (v)   If Tenant's leasehold interest under this Lease is sold
     under execution, attachment or decree of court to satisfy any debt of
     Tenant, or if any lien (including a

                                       12

<PAGE>

     mechanic's lien) is filed against Tenant's leasehold interest and is not
     discharged within ten (10) days thereafter.

          (b)  In the event of default as defined in paragraph (a) hereof,
Landlord, in addition to any and all legal and equitable remedies it may have,
shall have the following remedies;

               (i)  To distrain for any rent or additional rent in default; and
               (ii) At any time after default, without notice, to declare this
     Lease terminated and enter the Premises with or without legal process; and
     in such event Landlord shall have the benefit of all provisions of law now
     or hereafter in force respecting the speedy recovery of possession from
     Tenant's holding over or proceedings in forcible entry and detainer, and
     Tenant waives any and all provisions for notice under such laws.

          Notwithstanding such reentry and/or termination, Tenant shall
immediately be liable to Landlord for the sum of the following: (a) all rent and
additional rent then in arrears, without apportionment to the termination date,
including Tenant's contribution to taxes under paragraph 12 for the year of
termination, whether such termination is before or after July 1st of such year;
(b) all other liabilities of Tenant and damages sustained by Landlord as a
result of Tenant's default, including, but not limited to, the reasonable costs
of reletting the Premises and any broker's commissions payable as a result
thereof; (c) all of Landlord's costs and expenses (including reasonable counsel
fees) in connection with such default and recovery of possession; (d) the
difference between the rent reserved under this Lease for the balance of the
term and the fair rental value of the Premises for the balance of the term to be
determined as of the date of reentry; or at Landlord's option in lieu thereof,
Tenant shall pay the amount of the rent and additional rent reserved under this
Lease at the times herein stipulated for payment of rent and additional rent for
the balance of the term, less any amount received by Landlord during such period
from others to whom the Premises may be rented on such terms and conditions and
at such rentals as Landlord, in its sole discretion, shall deem proper; and (e)
any other damages recoverable by law. In the event Landlord brings any action
against Tenant to enforce compliance by Tenant with any covenant or condition of
this Lease, including the covenant to pay rent, and it is judicially determined
that Tenant has defaulted in performing or complying with any such covenant or
condition, then and in such event, Tenant shall pay to Landlord all costs and
expenses incurred by Landlord in bringing and

                                       13

<PAGE>

prosecuting such action against Tenant, including a reasonable attorney's fee.

          (c)  In the event Tenant fails to pay Landlord any rental payment or
other charge due hereunder on the date due, Tenant shall pay a late charge equal
to five percent (5%) of the rental payment or other such charge, which late
charge shall be collectible as additional rent. In addition, any such rental
payment or other charge which is delinquent, shall bear interest from the date
on which same was due at the prime rate of interest then being charged by
NationsBank to its most favored commercial customers.

     14.  Damage or Destruction.

          (a)  If, during the Lease term, the Premises hereby leased are damaged
by fire or other casualty, but not to the extent that Tenant is materially
prevented from carrying on business in the Premises, Landlord shall promptly
cause such damage to be repaired, if such damage renders a substantial portion
of the Premises untenantable, the rent reserved hereunder (except Tenant's share
of any charges for water) shall be abated, and such abatement shall be from the
date of the casualty to the date when the leased Premises are rendered fully
tenantable. Notwithstanding the foregoing, in the event such fire or other
casualty damages or destroys any of Tenant's leasehold improvements,
alterations, betterments, fixtures or equipment, Landlord shall have no
liability for the restoration or repair thereof.

          (b)  If, during the Lease term, the Premises or a substantial portion
of the building in which the Premises is situated are rendered as untenantable
to the extent that Tenant's ability to conduct its business is materially
impaired as the result of fire, the elements, unavoidable accident or other
casualty, Landlord shall have the option either to restore the Premises to their
condition immediately prior to the casualty or to terminate this Lease, such
option shall be exercised by Landlord by written notice to Tenant within thirty
(30) days after the fire, accident or casualty. In the event of such
termination, the rent reserved hereunder shall be adjusted as of the date of the
fire, accident or casualty. If Landlord elects to restore the Premises, such
restoration shall be completed within one hundred twenty (120) days of such
casualty and the rent reserved hereunder shall abate until the Premises are
again rendered tenantable.

                                       14

<PAGE>

     15. Possession.

In case possession of the Premises, in whole or in part, cannot be given to
Tenant on or before the commencement of the term of this Lease, Landlord agrees
to abate the rent proportionately until possession is given to Tenant, and
Tenant agrees to accept such pro rata abatement as liquidated damages for the
failure to obtain possession on the commencement date herein specified. The
parties hereto covenant and agree that if the term of this Lease commences on a
date other than the date herein specified, they will, upon the request of either
of them, execute an agreement in recordable form setting forth the new
commencement and termination dates of the Lease term. Under no circumstances
shall Landlord be under any liability for failure to deliver possession of the
Premises to Tenant on the date herein specified. Tenant shall have the right to
place its manufactured product (Inventory) in the Premises prior to the lease
commencement date without the provision to pay rent. Tenant agrees not to
interfere with Landlord, its agents or contractors who may be performing
improvements within the Premises or the Building. Landlord shall not be
responsible for any damage or theft of Tenant's inventory during the early
occupancy period.

     16. Exterior of Premises - Signs.

          (a)  Tenant covenants and agrees that it will not place or permit any
sign, billboard, marquee, lights, awning, poles, placard, advertising matter, or
other thing of any kind, in or about the exterior of the Premises or the
building in which the Premises are situate, nor paint or make any change in, to
or on the exterior of said Premises to change the uniform architecture, paint or
appearance of the building, without in each such instance obtaining the prior
written consent of Landlord. In the event such consent is given, Tenant agrees
to pay any minor privilege or other tax arising as a result of any such
installation immediately when due. Tenant shall obtain, at Tenant's expense, all
permits required for such installation. Tenant further agrees to maintain any
sign, billboard, marquee, awning, decoration, placard, or advertising matter or
other thing of any kind as may be approved by Landlord in good condition and
repair at all times.

          (b)  Tenant further covenants and agrees not to pile or place anything
on the sidewalk, parking lot or other exterior portion of the Premises or
building or in the front, rear or sides of the building, nor block the sidewalk,
parking lot or other exterior portion of the Premises or building, nor do
anything that directly or indirectly will interfere with any of the rights of
ingress or egress or of light from any other tenant, nor do anything which will,
in any way, change the uniform and general

                                       15

<PAGE>

design of any property of Landlord in which the Premises are situate.  In the
event this Lease covers all or substantially all of an entire building, Tenant
agrees to keep sidewalks, steps and porches free and clear of ice, snow and
debris.

     17.  Relocation

          Intentionally deleted.

     18.  For Rent/Sale Signs

Landlord shall have the right to place a "For Rent" sign on any portion of said
Premises for six (6) months prior to termination of this Lease and to place a
"For Sale" sign thereon at any time. During such six-month period, Landlord may
after reasonable notice to Tenant show the Premises and all parts thereof to
prospective tenants during Tenant's normal business hours.

     19.  Water and Other Damage

Landlord shall not be liable for, and Landlord is hereby released and relieved
from, all claims and demands of any kind by reason of or resulting from damage
or injury to person or property of Tenant or any other party, directly or
indirectly caused by (a) dampness, water, rain or snow, in any part of the
Premises and/or (b) falling plaster, steam, gas, electricity, or any leak or
break in any part of the Premises or from any pipes, appliances or plumbing or
from sewers or the street or subsurface or from any other place in the Premises
or of others or in the pipes of the plumbing or heating facilities thereof, no
matter how caused.

     20.  Right of Entry.

Landlord and its agents, servants, employees, including any builder or
contractor employed by Landlord, shall have the absolute and unconditional
right, license and permission, at any and all reasonable times, to enter with
prior notice and inspect the Premises or any part thereof, and at the option of
Landlord, to make such reasonable repairs and/or changes in the Premises as
Landlord may deem necessary or proper and/or to enforce and carry out any
provision of this Lease.

     21.  Termination of Term

          (a)  It is agreed that the term of this Lease shall expire and
terminate at the end of the original term hereof (or at the expiration of the
last renewal term, if this Lease contains a renewal option and the same is
properly exercised), without the necessity of any notice by or to any of the
parties hereto, unless otherwise provided herein.  If Tenant shall occupy the
Premises

<PAGE>

after such expiration or termination, it is understood that Tenant shall hold
the Premises as a tenant from month-to-month, subject to all the other terms and
conditions of this Lease, at an amount equal to 110% the highest monthly rental
installment reserved in this Lease. Landlord shall, upon such expiration or
termination of this Lease, be entitled to the benefit of all public general or
local laws relating to the speedy recovery of possession of lands and tenements
held over by Tenants that may be now in force or may hereafter be enacted.

          (b)  At the time Tenant surrenders the Premises to Landlord, the
Premises shall be in compliance with all applicable building code requirements
insofar as such requirements relate to Tenant's use and occupancy of the
Premises or to any installations, alterations or improvements made by Tenant
thereto.

     22.  Condemnation.

          (a)  If, during the term of this Lease, all or a substantial part of
the Premises shall be taken by or under power of eminent domain, this Lease
shall terminate as of, and the rent (basic and additional) shall be apportioned
to and abate from and after, the date of taking. Except as to Tenant's
improvements, Tenant shall have no right to participate in any award or damages
for such taking and hereby assigns all of its right, title and interest therein
to Landlord. For the purposes of this paragraph, "a substantial part of the
Premises" shall mean such part that the remainder thereof is rendered inadequate
for Tenant's business and that such remainder cannot practicably be repaired and
improved so as to be rendered adequate to permit Tenant to carry on its business
with substantially the same efficiency as before the taking.

          (b)  If, during the Lease term, less than a substantial part of the
Premises (as hereinabove defined) is taken by or under power of eminent domain,
this Lease shall remain in full force and effect according to its terms; and
Tenant shall not have the right to participate in any award or damages for such
taking and Tenant hereby assigns all of its right, title and interest in and to
the award to Landlord. In such event Landlord shall, at its expense, promptly
make such repairs and improvements as shall be necessary to make the remainder
of the Premises adequate to permit Tenant to carry on its business to
substantially the same extent and with substantially the same efficiency as
before the taking; provided that in no event shall Landlord be required to
expend an amount in excess of the award received by Landlord for such taking.
If, as a result of such taking, any part of the Premises is rendered permanently
unusable, the basic annual rent reserved hereunder

                                       17

<PAGE>

shall be reduced in such amount as may be fair and reasonable, which amount
shall not exceed the proportion which the area so taken or made unusable bears
to the total area which was usable by Tenant prior to the taking. If the taking
does not render any part of the Premises unusable, there shall be no abatement
of rent.

          (c)  For purposes of this section, "taking" shall include a negotiated
sale or lease and transfer of possession to a condemning authority under bona
fide threat of condemnation for public use, and Landlord alone shall have the
right to negotiate with the condemning authority and conduct and settle all
litigation connected with the condemnation. As hereinabove used, the words
"award or damages" shall, in the event of such sale or settlement, include the
purchase or settlement price.

          (d)  Nothing herein shall be deemed to prevent Tenant from claiming
and receiving from the condemning authority, if legally payable, compensation
for the taking of Tenant's own tangible property and such amount as may be
payable by statute or ordinance toward Tenant's damages for Tenant's loss of
business, removal and relocation expenses.

          (e)  Notwithstanding the provisions of paragraph 22 herein, Tenant
shall have the right to file for a separate award from any condemning authority.

     23.  Subordination.

Tenant covenants and agrees that all of Tenant's rights hereunder are and shall
be subject and subordinate to the lien of any first mortgage hereafter placed on
the leased Premises or any part thereof, except the Tenant's property or trade
fixtures, and to any and all renewals, modifications, consolidations,
replacements, extensions or substitutions of any first mortgage. Such
subordination shall be automatic, without the execution of any further
subordination agreement by Tenant. If, however, a written subordination
agreement, consistent with the provision, is required by a mortgagee, Tenant
agrees to execute, acknowledge and deliver the same and in the event of failure
so to do, Landlord may, execute, acknowledge and deliver the same as the agent
or attorney in fact of Tenant, and Tenant hereby irrevocably constitutes
Landlord its attorney-in-fact for such purpose.

     24.  Landlord's Right to Perform Tenant's Covenants.

If Tenant shall fail to perform any covenant or duty required of it by this
Lease or by law, Landlord, after giving thirty (30) days prior written notice to
Tenant and Tenant shall fail to cure or diligently pursue the cure of such
default, shall have the

                                       18

<PAGE>

right (but not the obligation) to perform the same, and if necessary to enter
the Premises for such purposes without notice.

  The reasonable cost thereof to Landlord shall be deemed to be additional rent
hereunder payable by Tenant, and Landlord shall have the same rights and
remedies with respect to such additional rent as Landlord has with respect to
the rental reserved hereunder.

     25.  Attornment.

          (a)  If Landlord assigns this Lease or the rents hereunder to a
creditor as security for a debt, Tenant shall, after notice of such assignment
and upon demand by Landlord or the assignee, pay all sums thereafter becoming
due Landlord hereunder either to Landlord or such assignee. Tenant shall also,
upon receipt of such notice, have all policies of insurance required hereunder
endorsed so as to protect the assignee's interest as it may appear and shall
deliver such policies, or certificates thereof, to the assignee.

          (b)  If, at any time during the term of this Lease, the Landlord of
the leased Premises shall be the holder of a leasehold estate covering Premises
which include the leased Premises, and if such leasehold shall terminate or be
terminated for any reason, or if, at any time during the term of Lease a
mortgage to which this Lease is subordinate shall be foreclosed, Tenant agrees
at the election and upon demand of any owner of the Premises which include the
leased Premises, or of any mortgagee in possession thereof, or of any holder of
a leasehold thereafter affecting Premises which include the leased Premises, or
of any purchaser at foreclosure, to attorn, from time to time, to any such
owner, mortgagee, holder or purchaser upon the terms and conditions set forth
herein for the remainder of the term demised in this Lease.

  Provided however, that Tenant shall not be obligated to attorn unless, if
Tenant shall so request in writing, such holder, owner, mortgage or purchaser
shall execute and deliver to Tenant an instrument wherein said holder, owner,
mortgagee or purchaser agrees that so long as Tenant performs all the terms,
covenants and conditions of this Lease, on Tenant's part to be performed,
Tenant's possession under the provisions of this Lease shall not be disturbed by
such holder, owner, mortgagee or purchaser.

          (c)  The foregoing provisions shall inure to the benefit of any such
owner, mortgagee, holder or purchaser and shall apply notwithstanding that this
Lease may terminate upon the termination of any such leasehold estate or upon
such foreclosure, and shall be self-operative upon any such demand, without
requiring any further instrument to give effect to such

                                       19

<PAGE>

provisions. Tenant, however upon demand of any such owner, mortgagee, holder or
purchaser, agrees to execute, from time to time an instrument in confirmation of
the foregoing provisions, satisfactory to any such owner, mortgagee, holder or
purchaser, in which Tenant shall acknowledge such attornment and set forth
herein and shall apply for the remainder of the term originally demised in this
Lease.

     26.  Non-Waiver of Future Enforcement.

The receipt of rent by Landlord, with knowledge of any breach of this Lease by
Tenant or of any default on the part of Tenant in the observance or performance
of any of the conditions or covenants of this Lease, shall not be deemed to be a
waiver of any provisions of this Lease, other than the provisions relating to
the non-payment of such rental payment. No failure on the part of Landlord or of
the Tenant to enforce any covenant or provision herein contained nor any waiver
of any right hereunder by Landlord or Tenant, shall discharge or invalidate such
covenant or provision or affect the right of Landlord or Tenant to enforce the
same in the event of any subsequent default. The receipt by Landlord of any rent
or any sum of money or any other consideration hereunder paid by Tenant after
the termination, in any manner, of the term herein demised, or after the giving
by Landlord of any notice hereunder to effect such termination, shall not
reinstate, continue or extend the term herein demised, or destroy, or in any
manner impair the efficacy of any such notice of termination as may have been
given hereunder by Landlord to Tenant prior to the receipt of any such sum of
money or other consideration, unless so agreed to in writing and signed by
Landlord. Neither acceptance of the keys nor any other act or thing done by
Landlord or any agent or employee during the term herein demised shall be deemed
to be an acceptance of a surrender of said Premises, excepting only an agreement
in writing signed by landlord accepting or agreeing to accept such surrender.

     27.  Personal Property Taxes.

Tenant shall be responsible for and shall pay any taxes or assessments levied or
assessed during the term of this Lease against any leasehold interest of Tenant
or personal property or trade fixtures of Tenant of any kind, owned by Tenant or
placed in, upon or about the Premises by Tenant.

     28.  Recordation of Lease.

Tenant agrees that it will, upon Landlord's request, execute a Memorandum of the
Lease in a form suitable for recording under

                                       20

<PAGE>

applicable Maryland law. The party recording such Memorandum of Lease shall pay
all costs of recordation, including transfer taxes and documentary stamp taxes
hereon.

     29.  Notices.

Any notice required by this Lease shall be sent by certified mail or by a
recognized overnight delivery service such as Federal Express with a receipt by
addressee to Landlord at: 2066 Lord Baltimore Drive, Baltimore, Maryland 21244.
Any notice required by this Lease shall be sent by certified mail, return
receipt requested to Tenant at:

     Dal-Tile Corporation    AND A COPY TO: Dal-Tile Corporation
     7834 Hawn Freeway                      1470 Progress Way
     P.O. Box 17130                         Eldersburg, MD 21784
     Dallas, Texas 75217                    ATTN: DISTRICT MGR.
     ATTN: REAL ESTATE DEBT.

if no other address specified, such notices to Tenant shall be addressed to the
leased Premises). Either party may, at any time, or from time to time, designate
in writing a substitute address for that above set forth, and thereafter all
notices to such party shall be sent by certified mail to such substitute
address.

     31.  Severability.

          (a)  It is agreed that, for the purpose of any suit brought or based
on this Lease, this Lease shall be construed to be a divisible contract, to the
end that successive actions may be maintained thereon as successive periodic
sums shall mature or be due hereunder, and it is further agreed that failure to
include in any suit or action any sum or sums then matured or due shall not be a
bar to the maintenance of any suit or action for the recovery of said sum or
sums so omitted; and Tenant agrees that it will not, in any suit or suits
brought or arising under this Lease for a matured sum for which judgment has not
previously been obtained or entered, plead, rely on or interpose the defenses of
res adjudicata, former recovery, extinguishment, merger, election of remedies
--- ----------
or other similar defense as a default to said suit or suits.

          (b)  If any terms, clause or provision of this Lease is declared
invalid by a court of competent jurisdiction, the validity of the remainder of
this Lease shall not be affected thereby but shall remain in full force and
effect.

                                       21

<PAGE>

     32.  Non-Waiver

It is understood and agreed that nothing herein shall be construed to be a
waiver of any of the terms, covenants or conditions herein contained, unless the
same shall be in writing, signed by the party to be charged with such waiver and
no waiver of the breach of any covenant herein shall be construed as a waiver of
such covenant or any subsequent breach thereof. No mention in this Lease of any
specific right or remedy shall preclude Landlord from exercising any other right
or from having any other remedy or from maintaining any action to which it may
be otherwise entitled either at law or in equity.

     33.  Successors and Assign.

Except as herein provided, this Lease and the covenants and conditions herein
contained shall inure to the benefit of and be binding upon Tenant, its
successors and assigns, and shall inure to the benefit of Tenant and only such
assignees of Tenant to whom an assignment by Tenant has been consented to in
writing by Landlord. In the event more than one person, firm or corporation is
named herein as Tenant, the liability of all parties named herein as Tenant
shall be joint and several.
          In the event Landlord's interest under this Lease is transferred or
assigned and written notice thereof is given to Tenant, the Landlord herein
named (or any subsequent assignee or transferee of Landlord's interest under
this Lease who gives such notice to Tenant) shall automatically be relieved and
released from and after the date of such transfer or conveyance from all
liability hereunder. The provision contained in the foregoing sentence is not
intended to, and shall not, limit any right that Tenant might otherwise have to
obtain injunctive relief against Landlord or Landlord's successors in interest
or any other action not involving the personal liability of Landlord to respond
in monetary damages from assets other than Landlord's interest in the building
or any suit or action in connection with enforcement or collection of amounts
which may become owing or payable under or on account of insurance maintained by
Landlord.

     34.  Notices to Mortgagee.

Tenant agrees that a copy of any notice of default from Tenant to Landlord shall
also be sent to the holder of any mortgage or deed of trust on the Premises;
provided Tenant has been given written notice of the fact that such mortgage or
deed of trust has been made; and Tenant shall allow said mortgagee or holder of
the deed of trust a reasonable time, not to exceed thirty (30) days from

                                       22

<PAGE>

the receipt of said notice, to cure, or cause to be cured, any such default. If
such default cannot reasonably be cured within the time specified herein, then
such additional time as may be necessary shall be allowed, provided the curing
of such default is commenced and diligently pursued within such time period
(including, but not limited to, commencement of foreclosure proceedings if
necessary to effect such cure) in which event this Lease shall not be terminated
while such remedies are being thus diligently pursued.

     35.  Estoppel Certificate.

Tenant shall, at any time and from time to time during the term of this Lease or
any renewal thereof, upon request of Landlord, execute, acknowledge, and deliver
to Landlord or its designee, a statement in writing, certifying that this Lease
is unmodified and in full force and effect if such is the fact (or if there have
been any modifications thereof, that the same is in full force as modified and
stating the modifications), the dates to which the rents and other charges have
been paid in advance, if any, and any defaults or claimed defaults by Landlord.
Any such statement delivered pursuant to this paragraph may be relied upon by
any prospective purchaser of the estate of Landlord or by the mortgagee or any
assignee of any mortgagee or the trustee or beneficiary of any deed of trust
constituting a lien on the Premises or upon property in which the Premises are
situate.

     36.  Environmental Provisions.

          (a)  Tenant and its successors and assigns shall use and operate the
building, the property and the leased premises, respectively, at all times
during the term hereof, under and in compliance with the laws of the State of
Maryland and in compliance with all applicable Environmental Legal Requirements.
"Environmental Legal Requirements" shall mean any applicable law relating to
public health, safety or the environment, including, without limitation,
relating to releases, discharges or omissions to air, water, land or
groundwater, to the withdrawal or use of groundwater, to the use and handling of
polychlorinated biphenyls (PCB's") or asbestos, or asbestos containing products,
to the disposal, treatment, storage or management of solid or other hazardous or
harmful wastes or to exposure to toxic, hazardous or other harmful materials
(collectively "Hazardous Substances") to the handling, transportation, discharge
or release of gaseous or liquid substance and any regulation or final order or
directive issues pursuant to such statute or ordinance, in each case applicable
to the premises, the building or its operation,

                                       23

<PAGE>

construction or modification, including without limitation the following: the
Clean Air Act, the Federal Water Pollution Control Act ("FWPCA"), the Safe
Drinking Water Act, the Toxic Substances Control Act, the Comprehensive
Environmental Response Compensation and Liability Act, as amended by the Solid
and Hazardous Waste Amendments of 1984 ("RCRA"), the Occupational Safety and
Health Act, the Emergency Planning and Community Right-to-Know Act of 1986, the
Solid Waste Disposal Act, and any state statutes addressing similar matters, and
any state statute providing for financial responsibility for clean-up or other
actions with respect to the release or threatened release of any of the
abovereferenced substances.

     (b) Tenant hereby indemnifies and saves Landlord harmless from all
liabilities and claims arising from the use, storage or placement of any
Hazardous Substances upon the premises or elsewhere within the Building or
property of Landlord (if brought or placed thereon by Tenant, its agents,
employees, contractors or invitees); and Tenant shall (i) within fifteen (15)
days after written notice thereof, take or cause to be taken, at its sole
expense, such actions as may be necessary to comply with all Environmental Legal
Requirements and (ii) within fifteen (15) days after written demand therefore,
reimburse Landlord for any amounts reasonably expended by Landlord (after first
consulting with Tenant) to comply with any Environmental Requirements with
respect to the premises or with respect to any other portions of Landlord's
Building or property as the result of the placement or storage of Hazardous
Substances by Tenant, its agents, employees, contractors or invitees, or in
connection with any judicial or administrative investigation or proceeding
relating thereto, including, without limitation, reasonable attorneys' fees,
fines or other penalty payments, to the extent that the acts or omissions of
Tenant are determined by a final, non-appealable order to have been a producing
cause of the violation of Environmental Legal Requirement.

     (c) For purposes of this provision, Tenant shall be conclusively deemed to
have violated the Environmental Legal Requirements if (i) Landlord obtains and
delivers to Tenant a report prepared by an engineer or other party engaged in
the business of testing or determining the existence of Hazardous Substances,
which report states that there are Hazardous Substances used, stored or placed
upon the premises, in violation of the Environmental Legal Requirements that
requires remediation, to the extent that the acts or omission of the tenant are
a producing cause of the violation requiring remediation.

<PAGE>

     In the event Tenant is deemed to have violated any of the Environmental
Legal Requirements requiring remediation as set forth in the preceding sentence,
Landlord shall have the right and option, after fifteen (15) days prior written
notice to Tenant, to terminate this lease by written notice thereof to Tenant,
in which event Landlord shall retain all rights and remedies, and Tenant shall
be subject to all liabilities, set forth in Article 13 of this lease
notwithstanding such termination.

          (d)  Tenant hereby grants Landlord, and Landlord's agents and
employees (including but not limited to, any engineers or other parties engaged
in the testing of Hazardous Substances) the right to enter upon the premises for
the purpose of determining whether Tenant, its agents, employees, contractors or
invitees, has violated any of the provisions of this Section.

          Environmental representations and warranties of the Landlord regarding
the Premises are set forth in the attached Exhibit "C".

     37.  Captions.

The captions of the various sections of this Lease are for convenience only and
are not a part of this Lease. Such captions shall not be construed to define or
limit any of the provisions of this Lease.

     38.  Final and Entire Agreement.

This Lease contains the final and entire agreement between the parties hereto,
and neither they nor their agents shall be bound by any terms, conditions or
representations not herein written.

     39.  Tenant Representative.

Tenant shall provide Landlord with the name, address and telephone number of
Tenant's representative to be contacted in event of emergency:

     40.  Additional Rent.

All sums of money required to be paid by Tenant to Landlord pursuant to the
terms of this Lease, unless otherwise specified herein, shall be considered
additional rent and shall be collectible by Landlord as additional rent, in
accordance with the terms of this Lease. Nothing herein contained shall be
deemed to suspend or delay the payment of any amount of money or charge at the
time the same becomes due and payable hereunder or to limit any other remedy of
Landlord.

                                       25

<PAGE>

     41.  Landlord's Work.

Landlord shall be responsible at its sole cost and expense for providing the
improvements to the Building and Premises as set forth in Exhibit "A" attached
hereto. The commencement date of the lease is conditioned upon Landlord's
substantial completion (excepting punch list items) of the improvement work set
forth on Exhibit "A". Landlord shall provide the finished offices (inclusive of
truckers' reception area with restroom) and shall provide openings in the
demising walls as reflected on the attached Exhibit "A". Landlord shall provide
warehouse lighting sufficient to maintain 30 foot-candles at four feet (4')
above the floor in accordance with a rack layout provided by Tenant.

     42.  Cancellation Option.

Tenant shall have the one-time right to terminate this contract after the
seventh (7th) year of occupancy by providing Landlord written notice of its
intention to terminate on or before February 28, 2003. Should Tenant terminate
this lease at the end of the seventh (7th) year, Tenant shall pay a cancellation
fee to Landlord at the time Tenant gives notice in the amount of Three Hundred
Fifty-one Thousand, Six Hundred Forty-five Dollars and Twelve Cents
($351,645.12). One-half of the cancellation fee shall be paid upon the date of
Tenant's notification, and the balance shall be due and payable at lease
termination.

     43.  Landlord's Guarantee.

Landlord shall provide and Guarantee Tenant a "Dedicated Loading Area" with a
paved truck court depth of 120', for Tenant's exclusive use. Landlord shall also
provide a "Common Loading Area" to be used by Tenant in common with others, and
Landlord shall not permit any improvements or obstructions to be constructed by
others in this area which may interfere with Tenant's truck access or
maneuvering. Both of the aforementioned "Dedicated and Common Loading Areas" are
described on the attached Exhibit "B".

     44.  Consent.

     Any consent required of any party hereto shall not be unreasonably withheld
or delayed.

                                       26

<PAGE>

     45.  Right of First Offer for Contiguous Space.

Landlord hereby grants Tenant the first right to lease any contiguous space as
same becomes available within the Building. In the event Landlord becomes aware
that such contiguous space is available, Landlord shall give Tenant written
notice thereof which notice shall set forth the prevailing market rent
(inclusive of tenant improvements) for comparable space in the Eldersburg
Business Center. In the event Tenant elects to exercise its right under this
Section, Tenant shall be required to give Landlord written notice thereof within
five (5) business days from the date of such notice from Landlord, and Tenant
shall be required to enter into a lease for such space within thirty (30) days
following the date of such notice. In the event Tenant fails to give Landlord
written notice of acceptance within such five (5) business day period or in the
event Tenant fails to  execute a lease within thirty (30) days thereafter,
Tenant shall be deemed to have forfeited its rights with respect to such
contiguous space, for that specific event of notification from Landlord. It is
the intent of the parties, that Tenant's right to lease space as set forth
herein shall apply to each instance where space becomes available, and Landlord
will provide Tenant the Right of First Offer. The terms of this Section 45 shall
not alter or change the provisions set forth in Section 48 of this Lease.

     46.  Non-Disturbance.

Landlord agrees within fifteen (15) days of execution of this Lease by both
parties to submit a written request for a Non-Disturbance Agreement on behalf of
Tenant from Landlord's mortgagee, and to use its best efforts to obtain the
Agreement within ninety (90) days from the date of Landlord's initial written
request. In the event Landlord refinances the Building, Landlord agrees to
resubmit a Non-Disturbance Agreement request to the new mortgagee, and Tenant
agrees to review same and make any reasonable modifications.

                                       27

<PAGE>

        47.  Tenant Fence.

Tenant shall have the right to install, at its sole cost and expense, chain link
fences both in the "Dedicated Loading Area" and the "Common Loading Area", with
an additional fence linking the two fenced areas together, no greater than 8
feet in height, and in the locations as shown on the attached Exhibit "B".
Tenant shall provide Landlord with six (6) months prior written notice of its
intent to install the fence(s). Tenant shall provide access to the "Common
Loading Area" for all other tenants in the Building.

        48.  Expansion

At any time during the lease term or any extension term (provided there is a
minimum of three (3) years remaining in the lease term) Tenant may notify
Landlord of its need to occupy the adjacent 41,400 square foot space ("Expansion
Space") and upon such notice Landlord agrees to relocate any Tenant occupying
such Expansion Space within one (1) year from the date of Tenant's notification
to Landlord. Tenant shall lease the Expansion Space at the then prevailing
market rent, inclusive of tenant improvements, for comparable space in the
Eldersburg Business Center.

        49.  Renewal Options.

If Tenant is not then in default under this Lease or any of the provisions
hereof, Tenant may extend the term of this Lease for one (1) additional
successive period of five (5) years, by notifying Landlord in writing of its
intention to do so at least six (6) months prior to the expiration of the then
current term. The renewal term shall be under the same lease terms and
conditions as are herein set forth except that the annual rental for the renewal
term shall be adjusted as follows:

                Term:         Annually:         Monthly:           Per S.F.:
                --------      ---------         --------           ---------
                Year 11       $1,141,895.88     $95,157.99         $3.63
                Year 12       $1,164,733.80     $97,001.15         $3.70
                Year 13       $1,188,028.44     $99,002.37         $3.77
                Year 14       $1,211,789.04     $100,982.42        $3.85
                Year 15       $1,236,024.84     $103,002.07        $3.92

All said rental shall be payable in advance in equal monthly installments on the
1st day of each month during said renewal term, without setoff or deduction.

There shall be no additional right to renew or extend this Lease except as
provided herein.

                                       28

<PAGE>

     AS WITNESS the hands and seals of the parties hereto the date and year
first above written.

                                          ELDERSBURG BUSINESS CENTER, INC.

                                      BY: MERRITT MANAGEMENT CORPORATION, INC.

                                          AGENT

                                          [ILLEGIBLE]                (SEAL)
                                          ---------------------------
                                                            President

                                                     LANDLORD

                                          DAL-TILE CORPORATION

                                          BY: [ILLEGIBLE]
                                              -----------------------(SEAL)

                                                      TENANT

                                       29

<PAGE>

                              DAL-TILE CORPORATION
                           ELDERSBURG BUSINESS CENTER
                                  EXHIBIT "A"

FLOOR: 6" concrete reinforced with Fibre Mesh (trade name) with a compression
     strength equal to or greater than 3,000 psi,

HVAC: Warehouse heat to be provided by gas-fired air rotation units sufficient
     to maintain an indoor temperature of 65 degrees Fahrenheit at an outside
     temperature of 8 degrees Fahrenheit.

ELECTRICAL: 277'480 volt three-phase, four wire service. One (1) duplex
     receptacle provided for each pair of overhead loading doors.

CHARGING STATIONS: To be provided as shown on the attached floor plan.

VENTILATION: Cross ventilation to be provided in warehouse areas, as shown on
     attached floor plan, sufficient to maintain comfortable, in Landlord's
     reasonable judgment, working conditions.

DOCK LIGHTS & DOCK LOCKS: Tenant shall have the right to install dock lights and
     dock locks at Tenant's expense. Landlord will upon written notice from
     Tenant prior to the commencement date of this Lease, agree to furnish and
     install dock locks on dock doors as specified by Tenant, provided that the
     total costs including installation does not exceed One Hundred Thousand
     Dollars ($100,000.00). Tenant agrees that the principal amount of
     Landlord's actual costs for the dock locks shall be amortized at an
     interest rate of ten percent (10%) for a term of seven (7) years, and that
     the annual payment for amortization shall be added to the annual rent
     payable by Tenant for the first seven (7) years of the lease term.

TRAILER STORAGE: Landlord shall provide a paved lot approximately 90' x 120' for
     Tenant's exclusive use for trailer storage. Landlord shall retain the right
     throughout the lease term, to relocate the lot within Eldersburg Business
     Center.

LIGHTING: As set forth in paragraph 41 in the lease agreement.

WATER FOUNTAINS: Landlord will furnish and install water fountains in the
     locations identified on the Exhibit A floor plan.

     *Exhibit A shall also include the attached floor plan describing the office
          space and other related improvements.

<PAGE>

                                   "EXHIBIT C"

                  ADDITIONAL PROVISIONS TO THAT CERTAIN LEASE
                  -------------------------------------------
BY AND BETWEEN ELDERSBURG BUSINESS CENTER, AS LANDLORD, AND DAL-TILE
--------------------------------------------------------------------
CORPORATION, AS TENANT, DATED JANUARY 15, 1997
----------------------------------------------

1.       REPRESENTATIONS AND WARRANTIES OF LANDLORD REGARDING THE PREMISES
         -----------------------------------------------------------------

     A.  Not withstanding any other provisions in this Lease to the contrary,
Landlord hereby warrants, covenants and represents to Tenant that, to the best
of Landlord's knowledge after reasonable inquiry, with respect to the Premises:

         (i)    it is in complete compliance, without exception, with the
Environmental Requirements:

         (ii)   it has no present knowledge, directly or indirectly, of the
issuance or threat of issuance by a Governmental Agency of any notice of
violation of the Environmental Requirements by the Landlord or a Co-Tenant;

         (iii)  No Hazardous Material is now located on the Premises in such a
manner or condition that results or could reasonably be expected to result in
any Adverse Environmental Impact;

         (v)    No part of the Premises has ever been used for the disposal,
storage, treatment, processing, manufacturing or other handling of Hazardous
Material in such a manner as to result in any Adverse Environmental Impact, nor
has any part of the Premises been affected by any Hazardous Materials
Contamination;

         (vi)   Landlord has not obtained and is not required to obtain any
licenses, permits or authorizations pursuant to any Environmental Requirements
in order to construct, occupy, operate or use any building, improvement, fixture
or equipment constituing any part of the premises;

         (vii)  No property adjoining the Premises is or has ever been used for
the disposal, storage, treatment, processing, manufacturing or other handling of
Hazardous Material, nor has any other property adjoining the Premises been
affected by Hazardous Material Contamination;

         (viii) No investigaion, administrative order, consent order and
agreement, litigation or settlement with respect to Hazadous Material or
Hazardous Material Contamination is proposed, threatened, anticipated or in
existence; and

         (ix)   The Premises has never been included on any federal or state
"Superfund" or "Superlien" list.

2.       INDEMNITY BY LANDLORD
         ---------------------

     A.  Notwithstanding any other provisions in this Lease to the contrary:

                    (i)   Landlord, its successors and assigns agree to
indemnify, defend, reimburse and hold harmless:

                          (a) The Tenant Group; and

                          (b) The directors, officers, shareholders, employees,
partners, contractors, subcontractors, experts, licensees, affiliates, lessees,
mortgagees, trustees, heirs, devises, successors, assigns and invitees of such
persons from and against any and all Environmental Damages, for which the
activities or omissions of the Landlord were a proximate cause or which exist as
a result of the breach of any warranty or covenant or the material inaccuracy of
any representation of Landlord contained in this Lease, or by Landlord's
remediation of the Premises or failure to meet its remediation obligations
contained in this Lease.

                    (ii)  The obligations contained in this Section 2 shall
include, but not be limited to, the reasonable and necessary burden and expense
of defending all claims, suits and administrative proceedings, even if such
claims, suits or proceedings are groundless, false or fraudulent, and conducting
all negotiations of any description, and paying and discharging, when and as the
same become due, any and all judgments, penalties or other sums due against such
indemnified persons. Landlord, at its sole expense, may employ additional
counsel of its choice to associate with counsel representing Tenant.

                    (iii) Landlord shall have the right but not the obligation
to join and participate in, at its own expense, if it so elects, any legal
proceedings or actions initiated in connection with Tenant's activities.

                    (iv)  The obligations of Landlord in this paragraph shall
survive the expiration or termination of this Lease.

                    (v)   The obligations of Landlord under this paragraph shall
not be affected by any investigation by or on behalf of Tenant, or by any
information which Tenant may have or obtain with respect thereto.

                    (vi)  In addition to the obligation of Landlord to indemnify
Tenant pursuant to this Lease, Landlord shall, upon approval and demand of
Tenant, at its sole cost and expense and using contractors approved by Tenant,
which approval shall not be unreasonably withheld, promptly take all actions to
remediate the Premises which are required by any Governmental Agency, or which
are reasonably necessary to mitigate Environmental Damages or to allow full
economic use of the Premises, which remediation is necessitated from the
presence upon, about or beneath the Premises, at any time during or immediately
prior to termination of this Lease, of a Hazardous Material or a violation of
Environmental Requirements for which the activities or omissions of the Landlord

<PAGE>

Group and/or Co-Tenant Group were a proximate cause. Such actions shall include,
but not be limited to, the investigation of the environmental condition of the
Premises, the preparation of any feasibility studies, reports or remedial plans,
and the performance of any cleanup, remediation, containment, operation,
maintenance, monitoring or restoration work, whether on or off the Premises,
which shall be performed in a manner approved by Tenant which approval shall not
be unreasonably withheld. Landlord shall take all actions reasonable and
practicable to restore the Premises to substantially the condition existing
prior to the introduction of Hazardous Material upon, about or beneath the
Premises.

3.        LANDLORD'S ADDITIONAL OBLIGATIONS
          ---------------------------------

     A.   Nothwithstanding any other provision in this Lease to the contrary:

                (i)    Landlord shall not cause, permit or suffer the existence
of Hazardous Material Contamination or the commission by the Landlord Group or
the Co-Tenant Group of any violation of any Environmental Requirements upon,
about or beneath the Premises.

                (ii)   Landlord shall neither create or suffer to exist, nor
permit the Landlord Group or the Co-Tenant Group to create or suffer to exist
any lien, security interest or other charge or encumbrance of any kind with
respect to the Premises including, but without limitation, any lien imposed
pursuant to Section 107(f) of the Superfund Amendments and Reauthorization Act
of 1986 (42 U.S.C.(S)9607(1)) or any similar state statute, arising as a
proximate result of the acts or omissions of the Landlord Group and/or the
Co-Tenant Group.

                (iii)  Landlord's breach of any of its covenants or obligations
under these Additional Provisions shall constitute a material default under the
Lease; if not remediated within twenty days after written notice from Tenant.
The obligations of the Landlord under these Additional Provisions shall survive
the expiration or earlier termination of the Lease without any limitation, and
shall constitute obligations that are independent and severable from Landlord's
covenants and obligations under the Lease.

4.        INDEMNITY BY TENANT
          -------------------

          Notwithstanding any other provisions in this Lease to the contrary:

          A.    Tenant, its successors and assigns agree to indemnify, defend
reimburse and hold harmless the Landlord Group; and from and against any and all
Environmental Damages, for which the activities or omissions of the Tenant were
a proximate cause or which exist as a result of the breach of any warranty or
covenant or the inaccuracy of any representation of Tenant contained in this
Lease.

          B.    The obligations contained in this Section 4 shall include, but
not be limited to, the reasonable and necessary burden and expense of defending
all claims, suits and administrative proceedings, even if such claims, suits or
proceedings are groundless, false or fraudulent, and conducting all negotiations
of any description, and paying and discharging, when and as the same become due,
any and all judgments, penalties or other sums due against such indemnified
persons.

          C.    Tenant shall have the right but not the obligation to join and
participate in, at its own expense, if it so elects any legal proceedings or
actions initiated in connection with Tenant's activities. Tenant may also, at
its own expense and risk, participate in any Hazardous Material attributable to
Landlord or Co-Tenant.

          D.    The obligations of Tenant in this paragraph shall survive the
expiration or termination of this Lease.

5.        ADDITIONAL DEFINITIONS:
          ----------------------

          Notwithstanding any other provisions in this Lease to the contrary.

     A.   "Hazardous Material" means any substance, whether solid, liquid, or
           ------------------
gaseous in nature:

          (i)   the presence of which requires investigation or remediation
under any federal, state or local statue, regulation, ordinance, order, action,
policy or common law; or

          (ii)  which is or becomes defined as a "hazardous waste," hazardous
substance," pollutant or contaminant under any federal, state or local statute,
regulations, rule or ordinance or amendments thereto including, without
limitation, the Comprehensive Environmental Response, Compensation and Liability
Act (42 U.S.C. section 9601, et seq.) and/or the Resource Conservation and
                             -- ---
Recovery Act (42 U.S.C. section 6901, et seq.); or
                                      -- ---

          (iii) which is toxic, explosive, corrosive, flammable, infectious,
radioactive, carcinogenic, mutagenic, or otherwise hazardous or is or becomes
regulated by any governmental authority, agency, department, commission, board,
agency or instrumentality of the United States, the State of Maryland or any
political subdivision thereof.; or

          (iv)  the presence of which on the Premises causes or threatens to
pose a hazard to the health or safety of persons on or about the Premises; or

          (v)   the presence of which on adjacent properties could constitute a
trespass by Landlord; or

          (vi)  without limitation which contains gasoline, diesel fuel or other
petroleum hydrocarbons; or

<PAGE>

       (vii)  without limitation which contains polychlorinated biphenyls
(PCBs), asbestos or urea formaldehyde foam insulation; or

       (viii) without limitation which contains radon gas.

   B.  "Hazardous Material Contamination" means the contamination (whether
        --------------------------------
presently existing or hereafter occurring) of the Improvements, facilities, soil
groundwater, air or other elements on or of the Premises by Hazardous Material,
or the contamination of the buildings, facilities, soil, groundwater, air or
other elements on or of any other property as a result of Hazardous Material at
any time emanating from the Premises.

   C.  "Release" means any spilling, leaking, pumping, pouring, emitting,
        -------
emptying, discharging, injecting, escaping, leaching, dumping or disposing into
the environment (including, but not limited to the abandonment or discarding of
barrels, containers and other receptacles containing any Hazardous Material).

   D.  "Reportable Quantity" means that quantity of a material as set forth in
        -------------------
40 C.F.R. Part 302.

   E.  "Adverse Environmental Impact" means (i) a Release of a Hazardous
        ----------------------------
Material in a Reportable Quantity or (ii) any material adverse impact on human
health or the quality of any property.

   F.  "Environmental Requirements" means all applicable present and future:
        --------------------------

       (i)  statutes, regulations, rules, ordinances, codes, licenses, permits,
orders, approvals, plans, authorizations, concessions, franchises, and similar
items (including, but not limited to those pertaining to reporting, licensing,
permitting, investigations and remediation), of all Governmental Agencies; and

       (ii) all applicable judicial, administrative, and regulatory decrees,
judgments, and orders relating to the protection of human health or the
environment, including, without limitation, all requirements pertaining to
emissions, discharges, releases, or threatened releases of Hazardous Materials
or chemical substances into the air, surface water, groundwater or land, or
relating to the manufacture, processing, distribution, use, treatment, storage,
disposal, transport, or handling of Hazardous Materials or chemical substances.

   G.  "Environmental Damages" means all claims, judgments, damages, losses,
        ---------------------
penalties, fines, liabilities (including strict liability), encumbrances, liens,
costs and expenses (including the expense of investigation and defense of any
claim, whether or not such claim is ultimately defeated, or the amount of any
good faith settlement or judgment arising from any such claim) of whatever kind
or nature, contingent or otherwise, matured or unmatured, foreseeable or
unforeseeable (including without limitation reasonable attorneys' fees and
disbursements and consultants' fees) any of which are incurred at any time as a
result of the existence of Hazardous Material or Hazardous Material
Contamination upon, about, or beneath the Premises migrating or threatening to
migrate in or from the Premises, or the existence of a violation of
Environmental Requirements pertaining to the Premises and the activities
thereon, regardless of whether the existence of such Hazardous Material or the
violation of Environmental Requirements arose prior to the present ownership or
operation of the Premises in whole or in part. Environmental Damages include,
without limitation:

       (i)   damages for personal injury, or injury to property of natural
resources occurring upon or off the Premises including, without limitation, lost
profits, consequential damages [if incurred as a result of fraud or material
misrepresentation as to these two elements of damage only], the cost of
demolition and rebuilding of any improvements on real property, interest and
penalties; and damages arising from claims brought by or on behalf of employees
of Landlord (with respect to which Landlord waives any right to raise as a
defense against Tenant any immunity to which it may be entitled under any
industrial or worker's compensation laws);

       (ii)  reasonable and necessary fees, costs or expenses incurred for the
services of attorneys, consultants, contractors, experts, laboratories and all
other costs incurred in connection with the investigation or remediation of such
Hazardous Material or Hazardous Material Contamination or violation of such
Environmental Requirements, including, but not limited to, the preparation of
any feasibility studies or reports or the performance of any cleanup,
remediation, removal, response, abatement, containment, closure, restoration or
monitoring work required by any Governmental Agency or reasonably necessary to
make full economic use of the Premises or any other property in a manner
consistent with its current use or otherwise expanded in connection with such
conditions, and including without limitation any reasonable and necessary
attorneys' fees, costs and expenses incurred in enforcing the provisions of this
Lease or collecting any sums due hereunder; and

       (iii) liability to any third person or Governmental Agency to indemnify
such person or Governmental Agency for costs expended in connection with the
items referenced in subparagraph (ii) above.

   H.  "Governmental Agency" means all governmental agencies, departments,
        -------------------
commissions, boards, bureaus or instrumentalities of the United States, states,
counties, cities and political subdivisions thereof.

   I.  The "Tenant Group" means Tenant, Tenant's successors, assignees,
            ------------
guarantors, officers, directors, mortgagees trustees, agents, partners,
employees, invitees, permitees or other parties under the supervision or control
of Tenant or lawfully entering the Premises during the term of this Lease with
the permission of Tenant, other than Landlord or its agents or employees.

   J.  The "Landlord Group" means the Landlord, Landlord's successors,
            --------------
assignees, guarantors, officers, directors, mortgagees, trustees, agents,
partners, employees, invitees, permitees or other parties under the supervision
or control of the Landlord or lawfully entering the Premises during the term of
this Lease with the permission of Landlord, other than Tenant or its agents or
employees.

   K.  "Co-Tenant" means any other lessee of any interest in the Premises.
        ---------

   L.  The "Co-Tenant Group" means any Co-Tenant, Co-Tenant's successors,
            ---------------
assigns, guarantors, officers, directors, mortgagees, trustees, agents,
partners, employees, invitees, permitees or other parties under the supervision
or control of the Co-Tenant or lawfully

<PAGE>

entering the Premises during the term of this Lease with the permission of
Co-Tenant, other than Tenant or Landlord or their agents or employees.

         TENANT                                     LANDLORD
         ------                                     --------

    Dal-Tile Corporation                      Eldersburg Business Center, Inc.

    By:____________________________________   By: /s/ [ILLEGIBLE]
                                                  ------------------------------

    Typewritten Carlos Sala, Vice President   Typewritten
    Name:  /s/ Carlos Sala                    Name: Leroy M. Merritt
    Title: ________________________________   Title: President
                                                     ---------------------------
    Date: _________________________________   Date: [ILLEGIBLE]
                                                    ----------------------------<PAGE>

                                                                   Exhibit 10.17

                                    SUBLEASE

     This sublease is made as of the 3 day of February, 1997 between KMART
CORPORATION, 3100 West Big Beaver Road, Troy, Michigan 48084 ("Sublessor"), and
DAL-TILE Corporation, a Pennsylvania corporation having an address 7834 C.F.
Hawn Freeway, Dallas Texas 75217 ("Sublessee").

                                   Recitals:
                                   --------

     A.   Metropolitan Life Insurance Company, a New York corporation, ("Prime
Lessor") and Sublessor entered into that certain lease, dated February, 1989,
(the "Prime Lease"), whereby the Prime Lessor leased to Sublessor certain land
and building in the City of Sunnyvale, Dallas County, Texas together with
certain non-exclusive rights and easements, all as more fully described on
Exhibit "A" attached hereto and made a part hereof (the "Demised Premises").

     B.   Sublessor and Sublessee desire to enter into a Sublease of the Demised
Premises upon the terms and conditions hereinafter set forth.

          NOW, THEREFORE, in consideration of the Demised Premises, the rents
reserved herein and the mutual benefits to be derived by Sublessor and
Sublessee, the parties hereby agree as follows:

     1.   Base Rent. Sublessee agrees to pay to Sublessor annual rent ("Base
          ---------
Rent") as follows: a) for the first two months of the term of this Sublease the
Base Rent shall be abated; b) for the third month through the thirty-sixth month
of the term of this Sublease, the Base Rent shall be One Million One Hundred Ten
Thousand Three Hundred Seventy Five and no/100 Dollars ($1,110,375.00) payable
in monthly installments of Ninety Two Thousand Five Hundred Thirty One and
25/100 Dollars ($92,531.25) each; c) for the thirty-seventh month through the
seventy second month of the term of this Sublease, the annual Base Rent shall be
One Million One Hundred Fifty Seven Thousand Six Hundred Twenty Five and 00/100
Dollars ($1,157,625.00) payable in monthly installments of Ninety Six Thousand
Four Hundred Sixty Eight and 75/100 Dollars ($96,468.75) each; d) if Sublessee
shall elect to extend the term hereof, for the First Extended Term of this
Sublease, the Basic Rent shall be One Million Two Hundred Fifty Two Thousand One
Hundred Twenty Five and 00/100 Dollars ($1,252,125.00) payable in monthly
installments of One Hundred Four Thousand Three Hundred Forty Three and 75/100
Dollars ($104,343.75) each; and e) for the Second Extended Term of this Sublease
the Base Rent shall be One Million Three Hundred Forty Six Thousand Six Thousand
Twenty Five and 00/100 Dollars ($1,346,625.00), payable in monthly installments
of One Hundred Twelve Thousand Two Hundred Eighteen and 75/100 Dollars
($112,218.75). Each installment shall be due on the first day of each calendar
month, and provided that Sublessor is able to obtain the agreement of Prime
Lessor as set forth in Section 6(e) below, shall be made at such place as may
from time to time be designated by Sublessor, in writing, and without previous
demand, setoff or deduction whatsoever; in the event that Sublessor is unable to
obtain the agreement of Prime Lessor as set forth in Section 6(e), then and in
that event, Sublessee shall pay a portion

<PAGE>

of the Basic Rent directly to Prime Lessor each month equal to the installment
of rent due to Prime Lessor under the Prime Lease, and shall pay the balance of
the Basic Rental installment each month to Sublessor and deliver therewith a
copy of the check for rent sent to the Prime Lessor. If the term of this
Sublease commences on a day other than the first of the month or ends on a day
other than the last day of the month (for a reason other than termination of the
Sublease on account of Sublessee's default), Base Rent for such month shall be
prorated. Prorated Base Rent for any such partial first month of the term hereof
shall be paid on the date on which the term commences and Base Rent for a
partial final month of the term shall be prorated on a daily basis and be
refunded to Sublessee.

     2.   Sublease Term. (a) Primary Term. Sublessor hereby subleases and
          -------------      ------------
demises to Sublessee and Sublessee hereby subleases and takes from Sublessor the
Demised Premises for an initial term commencing on the earlier of the thirty
first day from the date hereof or the date upon which the conditions of Sections
22(c) and 22(d) of the Prime Lease are satisfied (the "Term Commencement Date")
and ending on January 30, 2003 (the "Primary Term"). Sublessor agrees to deliver
to Sublessee and Sublessee agrees to accept from Sublessor exclusive possession
of the Demised Premises on the Term Commencement Date and Sublessee shall
thereafter have all of the rights and obligations of Tenant under the Prime
Lease, except as hereinafter set forth. Sublessor hereby agrees that Sublessee
shall have the benefit of all representations, rights and covenants provided to
Sublessor under the Prime Lease as fully and completely as if such
representations, rights and covenants were made by Prime Lessor directly to
Sublessee. From and after the date of this Sublease until the Term Commencement
Date, Sublessee shall have a license to enter upon the Demised Premises at
reasonable times and upon reasonable notice, in order to minimize interference
with the conduct of Sublessor's business and from time to time to make
inspections and investigations, to show the Demised Premises to contractors, to
professional consultants and others. All such entries by Sublessee and its
employees, agents, and invitees shall be at Sublessee's own risk and expense and
Sublessee agrees to indemnify Sublessor from and against any loss, cost,
liability or damage which results from Sublessee's rights of entry provided for
herein.

          (b)  Extension Terms. Sublessee shall have the option to extend the
               ---------------
term of Sublease for two successive terms, the first of which ("First Extended
Term") shall be for a period of six (6) years, and the second of which ("Second
Extended Term") shall commence at the end of the First Extended Term and shall
terminate on March 14, 2014, provided:

               (i)   Sublessee shall give Sublessor written notice of the
exercise of its option not less than nine (9) months prior to the expiration of
the then existing term hereof;

               (ii)  Sublessee shall not at the time of such exercise or at the
commencement of the extension term, be in default under the terms of this
Sublease; and

               (iii) each such extension term shall be upon the terms and
conditions as set forth herein.

     3.   Prime Lease Obligations. (a) Sublessor shall be responsible for the
          -----------------------
maintenance and repair of the roof of the Demised Premises.

                                       2

<PAGE>

          (b) Except as otherwise specifically provided herein, Sublessee agrees
to pay and perform Sublessor's obligations under the Prime Lease which are to be
performed after the date hereof, other than the obligation to pay the annual
rental required under the terms of Section 3, of the Prime Lease ("Prime Lease
Rent"). All payments to be made to governmental authorities and other third
parties shall be made by Sublessee on or before the due date. All such payments
shall be made directly to such governmental authorities or third parties.
Sublessor may from time to time request and Sublessee shall supply evidence of
payment. Sublessee shall have the same rights with respect to the timing and
manner of payments as Sublessor would have had under the Prime Lease including,
without limitation, the right to contest the imposition or amount of any tax or
other governmental assessment or levy, or the application to Sublessee or the
Demised Premises of any law, rule, regulation, order, ordinance or other form of
governmental regulation, to the same extent that Sublessor could do so under the
Prime Lease. Sublessor shall forward to Sublessee immediately upon receipt all
bills, invoices, statements, notices, orders or communications of any kind
concerning or pertainig to any matter or thing for which Sublessee is or may be
responsible hereunder.

          (c) All amounts which Sublessee is required to pay pursuant to this
Sublease (other than Base Rent), together with every fine, penalty, interest and
cost which may be added for non-payment or late payment thereof, (other than
non-payment or late payment attributable to Sublessor's failure or delay in
forwarding bills invoices, statements or notices relating to such required
payment), shall constitute additional rent ("Additional Rent"). In the event
that Sublessee shall fail to make any payment of Additional Rent for five (5)
days following notice that the same was not paid when due, Sublessor shall have
the right to make such payment on Sublessee's behalf and to demand reimbursement
of such amount from Sublessee.

          (d) If any installment of Base Rent shall not be paid on its due date,
Sublessee shall pay to Sublessor, on demand, interest at the rate provided for
late payments of Prime Lease Rent under the Prime Lease (or the highest interest
rate allowed by law, whichever is lower) on the amount of such installment from
the due date thereof until paid. Sublessee shall pay to Sublessor, on demand,
interest at such rate on all overdue Additional Rent paid by Sublessor on behalf
of Sublessee from the date of payment by Sublessor until repaid by Sublessee.

          (e) Sublessor agrees that it will pay to Prime Lessor, on or before
the date due, all installments of annual rent which are due under the Prime
Lease and shall otherwise comply with all terms and conditions of the Prime
Lease which are not undertaken by Sublessee under this Sublease. Sublessor
agrees that it will, upon request of Sublessee, pursue any rights which it may
have under the Prime Lease against the Prime Lessor in the event that the Prime
Lessor shall fail to comply with a request by the Sublessee under the Prime
Lease.

     4.   Use. The Demised Premises are agreed to contain 472,500 square feet
          ---
and may be used by Sublessee solely as a warehouse and distribution facility and
not for any manufacturing activities. The foregoing notwithstanding, Sublessee
shall not use the Demised Premises nor permit the Demised Premises to be used,
directly or indirectly, for: a massage parlor, adult book store or pornographic
display of any nature; gas station, auto service or repair center; junk yard or
dump; dry cleaner; or any use involving the operation of a below ground storage
tank or the use or sale on the Demised Premises of toxic, hazardous or explosive
substances, in violation of applicable law.

                                       3

<PAGE>

     5.   Title and Condition of Demised Premises. Sublessor will remove all of
          ---------------------------------------
its equipment from the Demised Premises, except the security system and
equipment utilized in the operation of the building and systems, prior to tender
of possession. Except as specifically provided in Section 7, (a)(v) below, (a).
The Demised Premises are subleased to Sublessee in their present condition by
Sublessor, without representation or warranty, subject to: (i) the Prime Lease
and all other easements, agreements, covenants and matters of record, (ii) all
taxes not yet due and payable, and (iii) subject to paragraph 4 above, all
applicable zoning rules, restrictions, regulations, resolutions and ordinances
and building restrictions and governmental regulations now or hereafter in
effect.

          (b)  By execution of this Sublease, Sublessee acknowledges and agrees
that it shall accept the Demised Premises on the Term Commencement Date in its
then "as is" and "where is" condition, provided that there has been no change or
deterioration in the Demised Premises from the date hereof other than change or
deterioration caused by Sublessee's use of the Demised Premises. Sublessee
acknowledges and agrees that neither Sublessor nor its agents or employees has
made any express warranty or representation regarding the physical or
environmental condition of the Demised Premises, the quality or workmanship of
the Demised Premises, latent or patent, or the fitness of the Demised Premises
for any particular use or purpose and that no such representation or warranty
shall be implied by law, it being agreed that all such risks are to be borne by
Sublessee.

          (c)  Sublessor makes no representation or warranty, express or
implied, with respect to the necessity (or lack of necessity) for or
availability of any permits, licenses or other governmental authorizations in
order to modify, alter or change the Demised Premises or to operate the Demised
Premises for the uses intended by Sublessee, it being agreed that all such risks
are to be borne by Sublessee.

          (d)  Upon termination of this Sublease, Sublessee shall remove all of
its equipment from the Demised Premises, repair any damage caused by such
removal and return the Demised Premises, broom clean and in the same condition
as received, ordinary wear and tear excepted.

     6.   The Prime Lease. (a) This Sublease and all rights of Sublease
          ---------------
hereunder and with respect to the Demised Premises are subject to the terms,
conditions and provisions of the Prime Lease. Sublessee shall have all of the
rights of Sublessor vis a vis the Landlord to enforce the obligations of the
Landlord under the Prime Lease.

          (b)  Without limitation of the foregoing:

               (i)  if Sublease desires to take any action, including structural
changes within the Demised Premises, and the Prime Lease would require the
Sublessor obtain the consent of the Prime Lessor before undertaking any action
of the same kind, Sublessee shall not undertake the same without the prior
written consent of Sublessor. Sublessor may condition its consent on the consent
of the Prime Lessor being obtained, and may require Sublessee to contact the
Prime Lessor directly for such consent but Sublessor shall not otherwise
unreasonably withhold, delay or condition its consent;

               (ii) Sublessor shall also have all rights, and all privileges,
options, reservations and remedies, granted or allowed to, or held by, the Prime
Lessor under the

                                       4

<PAGE>

Prime Lease to the extent that the exercise of those rights is not inconsistent
with the terms of the Sublease;

               (iii) Sublessee shall maintain insurance of the kinds required to
be maintained by Sublessor under the Prime Lease and including any rights of
self insurance subject to the Net Worth Requirement under the Prime Lease, and
the consent of Prime Lessor. All policies of liability insurance shall name the
Prime Lessor and Sublessor as additional insured and all physical damage
insurance shall insure Prime Lessor as its interest may appear; provided, that
Sublessee shall not be entitled to any insurance proceeds from policies which
may be carried by Sublessor, and if Sublessor is required to repair or restore
improvements and betterments to the Demised Premises insured by Sublessee,
Sublessee shall make available all insurance proceeds for such repair or
restoration to Prime Lessor; provided, however, that at the election of
Sublessee, Sublessor will maintain the insurance required to be maintained under
the Prime Lease, and Sublessee shall reimburse Sublessor therefore at the rate
of Forty Seven Thousand Two Hundred Fifty and no/100 Dollars (47,250.00) per
annum payable in equal monthly installment of Three Thousand Nine Hundred Thirty
Seven and 50/100 Dollars ($3,937.50) in advance on the first of each calendar
month;

               (iv)  Neither Sublessor nor Sublessee shall do anything or suffer
or permit anything to be done which results in a default under the Prime Lease
or permit the Prime Lease to be canceled or terminated. Sublessor shall not
attempt or agree to amend modify, cancel or reject the Prime Lease without the
prior written consent of Sublessee which may be withheld or granted in
Sublessor's sole discretion.

          (c)  Notwithstanding anything contained herein or in the Prime Lease
which may appear to be to the contrary, Sublessor and Sublessee hereby agree as
follows

               (i)   Sublessee shall not assign, or otherwise transfer or permit
the transfer of the Sublease or any interest of Sublessee in this Sublease, by
operation of law or otherwise, or permit the use of the Demised Premises or any
part thereof by any persons other than Sublessee and Sublessee's employees, or
sublet the Demised Premises or any part thereof, except to the extent Sublessor
gives consent to a subletting or assignment; provided that no consent shall be
required for a full or partial assignment of this Sublease or a sub-sublease of
all or any portion of the Demised Premises to an entity which controls, is
controlled by or under common control with the Sublessee. Sublessor agrees that
it will not unreasonably withhold, delay or condition its consent to a proposed
subletting or assignment for which its consent is required, provided that
Sublessee shall remain liable under this Sublease;

               (ii)  neither rental nor other payments hereunder shall abate by
reason of any damage to or destruction of all or part of the Demised Premises or
the Building unless, and then only to the extent that, rent actually abates
under the Prime Lease with respect to the Demised Premises on account of such
event;

               (iii) in the event of any conflict between the terms, conditions
and provisions of the Prime Lease and of this Sublease, the terms, conditions
and provisions of this Sublease shall govern and control.

                                       5

<PAGE>

        (d) Except as provided herein it is expressly understood and agreed that
Sublessor does not assume and shall not have any of the obligations or
liabilities of the Prime Lessor under the Prime Lease and that Sublessor is not
making the representations or warranties, if any, made by the Prime Lessor in
the prime Lease. With respect to work, services, repairs and restorations or the
performance of other obligations required of the Prime Lessor under the Prime
Lease, Sublessor's sole obligation with respect thereto shall be to request the
same, upon written request from Sublessee, and to use diligent efforts to abtain
the same from the Prime Lessor. Sublessor shall have the right to deal directly
with the Prime Lessor concerning the performance of Prime Lessor's obligations
under the Prime Lease. Sublessor shall not be liable in damages, nor shall rent
abate hereunder, for or on account of any failure by the Prime Lessor to perform
the obligations and duties imposed on it under the Prime Lease, except as set
forth in Section 6(c)(ii) above.

        (e) Sublessor shall use its best commercially reasonable efforts to
obtain an agreement from Prime Lessor for the benefit of Sublessee, that Prime
Lessor shall give written notice of any default under the Prime Lease to
Sublessee and thereafter Sublessee shall have fifteen (15) days to cure such
default.

     7. Representations and Warranties.
        ------------------------------

        (a) Sublessor. Sublessor represents and warrants to Sublessee as
            ---------
follows:

            (i)   Sublessor is a corporation, duly organized, validly existing
and in good standing in the State of Michigan; it has full power and authority
to enter into this Sublease with Sublessee; it has duly authorized the execution
and delivery of this Sublease; the Sublease has been duly executed and delivered
and constitutes a valid and binding obligation of Sublessor, enforceable in
accordance with its terms; the execution and delivery of the Sublease does not
violate or contravene any document, instrument, agreement, rule, regulation or
order to which Sublessor is a party or by or under which Sublessor is bound; no
consent or approval of any person or entity is required for this Sublease which
has not been obtained. As of the execution and delivery of the Sublease,
Sublessor is solvent, and will not be rendered insolvent by the transaction
contemplated herein;

            (ii)  There is no litigation pending, or to Sublessor's best
knowledge, threatened by any person or entity which does or could affect the
Demised Premises, or the Prime Lease, or this Sublease; Sublessor has not been
notified that there is any violation of law at or with respect to the Demised
Premises;

            (iii) The Prime Lease is in full force and effect, and has not been
terminated, amended, or modified except as indicated above. To the best of
Sublessor's knowledge and belief no default by Sublessor or Prime Lessor exists
under the Prime Lease and no event or act has occurred which, with the giving of
notice or passage of time or both, could ripen into a default under the Prime
Lease;

            (iv)  To the best of Sublessor's knowledge and belief, no
underground storage tanks are located on the Demised Premises;

                                       6

<PAGE>

               (v)  The Demised Premises will be delivered broom clean,
equipment in proper working order and bolts will be removed or flush cut
and holes in the floor caused by equipment removal or excessive wear by material
handling equipment will be repaired to the extent required for safety;

               (vi)  The Commencement Date of the Prime Lease is March 15, 1989
and the Prime Lease shall terminate March 31, 2014;

               (vii) On July 12, 1996, Sublessor sent written notice to Prime
Lessor of its intention to discontinue its operation at the Demised Premises and
of its desire to assign or sublet the Demised Premises, and that on the Term
Commencement Date, Sublessor shall not have received a notice of termination of
the Prime Lease from Prime Lessor.

          (b)  Sublessee represents and warrants to Sublessor that: (i)
Sublessee is a corporation, duly organized, validly existing and in good
standing under the laws of The State of Pennslyvania and has the power to own
its property and assets and carry on its business in the State of Texas;

               (ii)  the execution of this Sublease constitutes the binding
obligation of Sublessee;

               (iii) the sublease of the Demised Premises will not conflict with
or result in a breach of Sublessee's Articles of Incorporation or By-laws or any
material agreement to which Sublessee is a party or by which it may be bound, or
violate any state or federal governmental law, statute, ordinance or regulation.

     8.   Notices, Demands and Other Instruments. All notices, demands or other
          --------------------------------------
communications given pursuant to this Sublease shall be in writing and shall be
deemed given on the date mailed if mailed by nationally recognized overnight
courier or by registered or certified mail, return receipt requested, with
postage prepaid if: (a) when mailed to Sublessor, it is addressed to Sublessor
at its address set forth above, marked "Attention: Vice President - Corporate
Facilities," and (b) when mailed to Sublessee, it is addressed to Sublessee at
its address set forth above. The parties may specify any other address in the
United States with fifteen (15) days' notice.

           To Sublessor:            Kmart Corporation.
                                    3100 West Big Beaver Road
                                    Troy, Michigan 48084
                                    Attn: Vice President Real Estate
                                    Telecopier: 810-643-2689

          With a copy to:           Dickinson Wright, Moon, VanDusen
                                         and Freeman
                                    225 West Washington Street, #400
                                    Chicago, Illinois 60606
                                    Attention: Ronald B. Grais
                                    Telecopier: 312-220-0021

                                       7

<PAGE>

          To Sublessee:             Dal-Tile Corporation
                                    7834 Hawn Freeway
                                    Dallas, TX 75217
                                    Attn: Manager-Real Estate
                                    Telecopier: 214-309-4934

          With a copy to:           Godwin & Carlton
                                    901 Main Street
                                    Suite 3300
                                    Dallas, TX 75202-3714
                                    Attn: Joshua Mond
                                    Telecopier: 214-760-7332

     9.   Separability. If any provision of this Sublease or its application to
          ------------
any persor or circumstance shall be declared invalid or unenforceable, the
remaining provisions of this Sublease, or the application of such provision to
persons or circumstances other than those to which it is invalid or
unenforceable, shall not be affected thereby and each provision shall be valid
and enforceable to the extent permitted by law.

     10.  Binding Effect. All provisions contained in this Sublease shall be
          --------------
binding upon, inure to the benefit of, and be enforceable by, the respective
successors and assigns of Sublessor and Sublessee. If Sublessor acquires a fee
interest in the Demised Premises, this Sublease shall not be affected and shall
continue as a direct lease of the Demised Premises between Sublessor and
Sublessee.

     11.  Interpretation, Amendment and Modification. This Sublease shall be
          -------------------------------------------
interpreted under the laws of the State of Texas. The Section and subsection
captions are for the convenient reference of the parties only and are not
intended to and shall not be deemed to modify the interpretation of the Section
or subsection from that which is indicated by the text of the Section or
subsection alone. All of the representations, warranties and indemnities
contained in this Sublease shall survive indefinitely the expiration or
termination of this Sublease. This Sublease is the product of negotiation and
the parties agree that it shall not be interpreted against the drafter. This
Sublease contains the entire agreement between the parties with respect to the
Demised Premises and all prior negotiations or agreements, whether oral or
written, are superseded and merged herein. This Sublease may not be changed or
amended except by a writing duly authorized and executed by the party against
whom enforcement is sought.

     12.  Brokers. Each party hereby represents and warranties to the other that
          -------
it has had no dealings with any real estate broker or agent in connection with
this Sublease excepting only Russ Peterson of Dallas, Texas, whose commission
shall be paid upon Sublessee's occupancy by Sublessor in accordance with the
agreement between broker and Sublessor and subject to rent offset and that it
knows of no other real estate broker or agent who is or might be entitled to a
commission in connection with this Sublease. Each party agrees to protect,
defend, indemnify and hold the other harmless from and against any and all
claims inconsistent with the foregoing representations and warranty for any
brokerage, finders or similar fee or commission in connection with this Sublease
if such claims are based on or relate to any act of the indemnifying party which
is contrary to the foregoing representations and warrantiies.

                                        8

<PAGE>

     13.  Memorandum of Sublease. This Sublease shall not be recorded. If a
          ----------------------
party records this Sublease, it shall be a default hereunder by such party.
Sublessor and Sublessee shall, simultaneously with the execution of this
Sublease, enter into a short form memorandum of this Sublease and Sublessee
shall pay the cost to record the memorandum and any transfer, conveyance or
similar tax due as a result of the subleasing of the Demised Premises or the
recording of the memorandum.

     14.  Indemnification. (a) Indemnification by Sublessee. Sublessee agrees
          ---------------      ----------------------------
that it will indemnify and hold Sublessor, and its successors in interest
hereunder, harmless from and against any loss, cost, expense, damage (including
consequential or incidental damage), penalty or liability which Sublessor does
incur as a result of or arising from

               (i)   Sublessee's use of the Demised Premises during the term;

               (ii)  the breach or violation of any representation, warranty,
covenant or agreement made by Sublessee hereunder;

               (iii) Sublessee's failure to perform its obligations under this
Sublease or to perform those of the obligations under the Prime Lease which
Sublessee has agreed to perform on Sublessor's behalf.

          (b)  Indemnification by Sublessor. Sublessor agrees that it will
               ----------------------------
indemnify and hold Sublessee, and its successors in interest hereunder, harmless
from and against any loss, cost, expense, damage (including consequential or
incidental damage), penalty or liability which Sublessee does incur as a result
of or arising from

               (i)   the condition or use of the demised Premises prior to the
Sublease Term Commencement Date;

               (ii)  the breach or violation of any representation, warranty,
covenant or agreement made by Sublessor hereunder.

               (iii) the failure of Sublessor to perform its obligations under
this Sublease or to perform those of its obligations under the Prime Lease which
remain the primary responsibility of Sublessor, or

               (iv)  any act or omission done or made by Sublessor which results
in the termination, cancellation or rejection of the Prime Lease and/or the
Sublease, or the inability of Sublessee to have the full benefit of the rights
provided to Sublessee hereunder.

          (c)  In no event shall Sublessee or Sublessor be required to indemnify
or hold harmless any person or entity for any loss, cost, damage, penalty or
liability which is the result of the negligence or willful misconduct of the
person or entity seeking indemnification.

     15.  Rental Deposit. Upon the Term Commencement Date, Sublessee shall
          --------------
prepay the monthly installments of Base Rent for the eleventh and twelfth months
of the Primary Term, in the amount of Ninety Two Thousand Five Hundred Thirty
One and 25/100 Dollars ($92,531.25) each respectively.

                                       9

<PAGE>

        16. Condition Precedent. This Sublease is subject to consent thereto by
            -------------------
Prime Lessor either by lapse of time under Section 22 (b) of the Prime lease or
by written consent to the terms of this Sublease, within thirty (30) days of the
date hereof. If Prime Lessor refuses to consent to this Sublease, or elects to
negotiate directly with Sublessee in accordance with Section 22(b) of the Prime
Lease, this Sublease shall simultaneously terminate and neither party shall have
any further rights or obligations under the Sublease and each party hereby
releases the other from any cost, loss, damage, claim, liability, expense, fee
or charge related to, arising from or involving this Sublease or the Demised
Premises.

        IN WITNESS WHEREOF, the parties hereto have caused this Sublease to be
executed as of the date first above written.

WITNESSED:                    KMART CORPORATION
                              ("Sublessor")

/s/ [ILLEGIBLE]
--------------------          By: /s/ [ILLEGIBLE]
                                 -----------------------------------
--------------------          Its:     Real Estate Rep:
                                   ---------------------------------------------
                                       Dickinson, Wright:
                                          Approved:_____________________________
                                          Reviewed (see comments): /s/ ILLEGIBLE
                                                                  --------------

                              DAL-TILE CORPORATION
                              ("Sublessee")

                              By:  /s/ James Eckelberger
                                 -------------------------------
                                   James Eckelberger
/s/ [ILLEGIBLE]               Its: Vice President
--------------------

                                       10

<PAGE>

                                    EXHIBIT A
                                    ---------

K MART ADDITION, an Addition to the City of Sunnyvale, Dallas County, Texas,
according to the Plat recorded in Volume 87118, Page 1904, Map Records, Dallas
County, Texas, and being more particularly described by metes and bounds as
follows:

Beginning at an iron rod found at the Northeast corner of Lot 1, Block 8 of
SAMUEL PARK FARMS WEST, an Addition to the City of Mesquite, Texas, according to
the Plat recorded in Volume 83216, Page 3409, Map Records, Dallas County, Texas,
said iron rod also being in the West right-of-way line of Planters Road;

THENCE South 89 degrees 33 minutes 38 seconds West, along the North line of said
SAMUEL PARK FARMS WEST, a distance of 1669,48 feet to an iron rod found in
place;

THENCE North 0 degrees 05 minutes 25 seconds West, 970.81 feet to an iron rod
found in place;

THENCE North 89 degrees 33 minutes 38 seconds East, 1237.00 East to an iron rod
found in place in the aforementioned West right-of-way line of Planters Road;

THENCE along said West right-of-way line as follows;

1)   Southeasterly, 8.04 feet along a curve to the left having a radius of
1030.00 feet, a central angle of 0 dgrees 26 minutes 50 seconds and a chord
bearing South 46 degrees 18 minutes 50 seconds East a distance of 8.04 feet to
an iron rod found in place at the-end of said curve;

2)   South 46 degrees 32 minutes 20 seconds East, 373.37 feet to an iron rod
found in place at the beginning of a curve to the right;

3)   Southeasterly, 398.27 feet along said curve to the right having a radius of
495.00 feet, a central angle of 46 degrees 05 minutes 58 seconds and a chord
bearing South 23 degrees 29 minutes 21 seconds East a distance of 387.81 feet to
a ??? found cut in concrete at the end of said curve;

4)   South 0 degrees 26 minutes 22 seconds East, 349.63 feet to the PLACE OF
BEGINNING and containing 35.000 acres (1,524,600 square feet) of land.

<PAGE>

                                   EXHIBIT "C"

                 THIS LEASE (the "Lease") made and entered into as of the _____
            day of February, 1989, by and between METROPLITAN LIFE INSURANCE
            COMPANY, a New York corporation having its principal office at One
            Madison Avenue, New York, New York 10010 (herein referred to as
            "Landlord"), and K MART CORPORATION, a Michigan corporation having
            its principal office at 3100 West Big Beaver Road, Troy, Michigan
            48084 (herein referred to as "Tenant"),

                 WITNESSETH:  That in consideration of the rents, covenants, and
            conditions herein set forth, landlord and Tenant do hereby covenant,
            promise and agree as follows:

Demised
Premises         1.  Without representation or warranty, express or implied,
--------    Landlord does demise unto Tenant and Tenant does take from Landlord,
            for the "Lease Term" (hereinafter defined), the following property:
            That certain tract or parcel of real property which is more
            particularly described on Exhibit "A" attached hereto and made a
            part hereof (the "Land"), together with the building(s) and/or
            improvements existing on the Land on the date hereof and all
            additional buildings and/or improvements hereafter erected or
            constructed on the Land (the "Improvements"); subject, however, to
            the matters listed on Exhibit "B" attached hereto and made a part
            hereof.

                 Said Land and Improvements, together with any right, title or
            interest of Landlord in or to any licenses, rights, privileges and
            easements  appurtenant thereto, shall be hereinafter collectively
            referred to as the "demised premises".

Term             2.  The term of this Lease shall commence upon the date of this
----        Lease (the "Commencement Date") and shall terminate upon such date
            as shall be twenty-five (25) years from the last day of the month
            during which the Commencement Date occurs (the "Initial Lease Term);
            provided however, the term of this Lease may be extended as provided
            in Article 12 hereof. The phrase "Lease Term", as used in this
            Lease, shall mean the Initial Lease Term, together with any
            extension(s) pursuant to Article 12 hereof.

Annual
Rental           3.  Tenant shall, during the Lease Term, pay to Landlord, at
------      such place as Landlord shall designate in writing from time to time,
            an annual rental in the following amounts:

                 Years  1-5:   $1,040,910 per annum
                 Years  6-10:  $1,092,956 per annum
                 Years 11-15:  $1,147,604 per annum
                 Years 16-20:  $1,204,984 per annum
                 Years 21-25:  $1,265,233 per annum

                 Rental During Option Period
                 ---------------------------

                 1st five-year option - $1,391,756.00 per annum
                 2nd five-year option - $1,530,931.00 per annum
                 3rd five-year option - $1,684,024.00 per annum
                 4th five-year option - $1,852,427.00 per annum
                 5th five-year option - $2,037,670.00 per annum
                 6th five-year option - $2,241,437.00 per annum

<PAGE>

          The annual rentals listed above shall be paid by Tenant to Landlord
          without deduction or offset, except as expressly provided in Articles
          20 and 21 hereof, in equal monthly installments on the first day of
          each month, in advance, commencing on the Commencement Date; provided
          however, in the event the Commencement Date shall not be the first day
          of a calendar month, then the rental for such month shall be prorated
          (on the basis of a rental of $1,040,910.00 per annum) upon a daily
          basis and shall be in addition to rental for the first year of the
          Lease Term in the amount of $1,040,910.00 as provided above in this
          Article 3; it being understood between Landlord and Tenant that the
          first year of the Lease term shall be a period of twelve (12) months,
          plus the number of days which exist between the Commencement Date and
          the last day of the month during which the Commencement Date occurs.
          The annual rental to be paid by Tenant hereunder shall be absolutely
          net to Landlord and free of any operating expenses relative to the
          demised premises, so that this Lease shall yield the annual rentals
          specified above, net to Landlord, throughout the Lease Term.

Real
Estate
Tax           4.   Tenant shall pay and discharge all ad valorem real estate
---
          taxes and assessments of any nature which shall be levied against the
          demised premises during the Lease Term.

               Tenant shall pay and be liable for all sales and use taxes and
          other similar taxes, if any, levied or imposed by any city, state,
          county or other governmental body having authority. Tenant shall also
          be liable for and shall pay all taxes levied or assessed against
          Tenant's property or equipment located in or upon the demised
          premises, or any part thereof. Notwithstanding the immediately
          preceding sentence, Tenant shall not be chargeable with, nor be
          obligated to pay, any income, profit, inheritance, estate, succession,
          gift, franchise or transfer taxes which are or may be imposed upon
          Landlord, its successors or assigns, and which do not result from
          Tenant's use of the demised premises, by whatsoever authority imposed
          or howsoever designated.

               Taxes and assessments payable by Tenant pursuant to this Article
          4 for the last year of the Lease Term shall be prorated based upon
          actual tax and/or assessments statements, if available; otherwise, the
          proration shall be made based upon the most recent tax and/or
          assessment statements available.

               Written evidence of the payment by Tenant of taxes and
          assessments pursuant to this Article 4 shall be furnished by Tenant to
          Landlord not later than ten (10) days prior to the date upon which any
          such taxes or assessments would become delinquent.

               Tenant shall have the right to contest, with such right to be
          exercised reasonably and in good faith, the validity or the amount of
          any tax or assessment levied against the demised premises by such
          appellate or other proceedings as may be appropriate in the
          jurisdiction and may defer payment of such obligations, pay same under
          protest, or take such other steps as Tenant may reasonably deem
          appropriate; provided that, (i) neither the demised premises, nor any
          part thereof or interest therein, would be, in Landlord's sole
          opinion, in any danger of being sold, forfeited, lost or interfered
          with, and (ii) Tenant

                                       -2-

<PAGE>

               shall furnish such security as may be required in any legal
               proceeding or as shall be reasonably requested by Landlord.
               Landlord shall cooperate in the institution and prosecution of
               any such proceedings in a reasonable manner (but without cost or
               expense to Landlord) and will execute any documents reasonably
               required therefor. All costs and expenses of such proceedings
               shall be borne solely by Tenant and any refunds or rebates
               secured thereby shall belong to Tenant. Tenant shall not withhold
               payment of taxes which will cause any taxing authority to impose
               a tax lien against the demised premises, or any part thereof, and
               shall indemnify and hold Landlord harmless from any loss, cost or
               expense incurred by Landlord including, without limitation,
               attorneys' fees, as a result of any such contest(s) or
               proceeding(s).

                    5.   Article 5 is Intentionally Deleted.

                    6.   Article 6 is Intentionally Deleted.

                    7.   Article 7 is Intentionally Deleted.

                    8.   Article 8 is Intentionally Deleted.

                    9.   Article 9 is Intentionally Deleted.

                    10.  Article 10 is Intentionally Deleted.

Landlord's
Covenant
not to
Build               11.  Landlord covenants that it will not erect any buildings
-----
               or other structures on the land described in Exhibit "A" during
               the Lease Term.

Options
Extend
Lease               12.  Tenant shall have the right and option to extend the
-----
               term of this Lease for six (6) successive additional periods of
               five (5) years each, such extended term to begin, as the case may
               be, upon the expiration of the Initial Lease Term or upon the
               expiration of the then current extension following the expiration
               of the Initial Lease Term and each such extension shall be upon
               the same terms and conditions as herein set forth, except as
               otherwise provided herein. If Tenant shall elect to exercise one
               or more of the aforesaid option(s), it shall do so, in each case,
               by giving written notice to Landlord not less than six (6) months
               prior to the expiration of the then current term of this Lease.
               Time is of the essence with respect to each notice of Tenant's
               election to extend the term of this Lease and the failure of
               Tenant to provide written notice to Landlord on or before six (6)
               months prior to the expiration of the then current term of this
               Lease, shall be deemed to be an irrevocable waiver of any further
               rights to Tenant to extend the term of this Lease.

Purchase
Options             13.  Anything in this Lease contained to the contrary
-------
               notwithstanding, and without in any manner affecting or limiting
               any of the rights, options or estates granted to Tenant under
               this Lease, if the Landlord, at any time during the Lease Term,
               receives one or more bona fide offers from third parties to
               purchase the demised premises, and if any such offer is
               acceptable to the Landlord, then Landlord shall notify Tenant in
               writing, giving the price, terms and conditions of such offer,
               and

                                      -3-

<PAGE>

               Tenant shall have ten (10) days from and after the receipt of
               such notice from Landlord in which to elect to purchase the
               demised premises for the consideration and on the terms and
               conditions contained in the bona fide offer. If Tenant does not
               elect to purchase said demised premises and Landlord thereafter
               sells the demised premises, the purchaser shall take the demised
               premises, subject to and burdened with all the terms, provisions
               and conditions of this Lease, excluding this Article 13, the
               former landlord shall be relieved of all obligations hereunder,
               and the rights of the Tenant under this Lease as against the new
               owner shall not be lessened or diminished by reason of the change
               of ownership. Tenant's failure at any time to exercise its option
               under this Article 13 in the manner and within the time period
               specified above shall be deemed to be an irrevocable waiver by
               Tenant of such option. The date of closing of the subject sales
               transaction and the procedure to be followed with respect to the
               closing of the subject transaction shall be as specified in
               Landlord's notice. The purchase option granted to Tenant under
               this Article 13 shall be personal to Tenant and shall terminate
               upon the assignment of this Lease or the subletting of all or any
               portion of the demised premises by Tenant. The provisions of this
               Article 13 shall not be applicable to the transfer, conveyance or
               assignment, by whatsoever means, of the demised premises, or any
               portion thereof, or interest therein, and/or this Lease to an
               "Affiliate" of Landlord. As used in this Article 13, the term
               "Affiliate" shall mean any person or entity under common control
               of a person or entity which controls Landlord or which is
               controlled by Landlord.

Repairs             14. Tenant shall, at Tenant's sole cost and expense,
-------        undertake all maintenance and repairs with respect to the demised
               premises including, without limitation, structural and
               non-structural repairs and replacements, and Tenant shall, during
               and throughout the Lease Term, take good care of the demised
               premises and maintain the demised premises in good, safe and
               tenantable condition. With respect to any structural repairs or
               replacements, Tenant shall, after obtaining Landlord's prior
               written consent to the extent required pursuant to this Article
               14, promptly cause all necessary structural repairs and
               replacements to be made in quality and class equal to the
               condition of such structural portions on the date of this Lease,
               and upon completion shall furnish to Landlord "as built" plans
               and specifications for the work so performed. As used herein, the
               phrase "structural portions" refers to the foundation, exterior
               walls, members supporting the roof and the roof, but excludes, by
               way of example and not by way of limitation, interior walls,
               doors, molding, trim, window frames, door frames, closure,
               devices, hardware and plate glass. With respect to non-structural
               repairs or replacements, Tenant, after obtaining Landlord's
               consent to the extent required pursuant to this Article 14, shall
               promptly cause all necessary non-structural repairs and
               replacements to be made in quality and class equal to the
               condition of the demised premises on the date of this Lease. In
               the event that Landlord considers it necessary that any
               maintenance, replacements, renewals or repairs required by the
               provision of this Article 14 be made by Tenant, Landlord may
               request Tenant to undertake such repairs, renewals, replacements,
               or maintenance; and upon Tenant's failure or refusal to do so
               promptly, and in any event in case of an emergency, Landlord
               shall have the right, but not the obligation, to perform such
               maintenance or to make such repairs, renewals or replacements,
               Tenant hereby waiving any claim for damage caused thereby. Any

                                      -4-

<PAGE>

               sum so expended by Landlord shall be promptly reimbursed to
               Landlord by Tenant; and any such amount shall bear interest from
               the date on which Landlord expends such sum to the date of
               payment by Tenant at the then highest lawful contract rate which
               Tenant is authorized to pay under applicable law, not to exceed
               18% per annum. Any such sum for which Tenant becomes liable to
               reimburse Landlord may be treated by Landlord as rent and be
               payable to Landlord on the first (1st) day of the next succeeding
               month. In the event that Landlord performs any such maintenance
               or makes any such repairs, renewals or replacements or undertakes
               to do so, Landlord shall not be liable to Tenant for any loss or
               damage which may occur to Tenant's equipment and property located
               within or on the demised premises incident to such action by
               Landlord. Tenant need not obtain the consent of Landlord before
               undertaking repairs or replacements pursuant to this Article 14
               or alterations pursuant to Article 15, provided, in the case of
               non-structural repairs, replacements, changes and alternations,
               the costs of all such non-structural repairs, replacements,
               changes and alternations made during any calendar year do not
               exceed $200,000.00 in the aggregate; and provided, further that
               in the case of structural repairs, replacements, changes and
               alterations, the costs of all such structural repairs,
               relacements, changes and alterations made during any calendar
               year do not exceed $75,000.00 in the aggregate. In the event the
               costs of repairs, replacements, changes, and alterations proposed
               to be made would cause the aggregate costs of such repairs,
               replacements and alterations to exceed the limits for a calendar
               year set forth in the immediately preceding sentence of this
               Article 14, then Tenant shall obtain the consent of Landlord to
               such repairs, replacements, changes and alterations proposed to
               be made before the same are commenced, which consent shall not be
               unreasonably withheld or delayed by Landlord.

Alterations
and Addi-
tional Con-
struction           15.  Tenant may, at its own expense at any time, subject to
---------
               the conditions hereinafter set forth in this Article 15, (a)
               after obtaining the prior written consent of Landlord, which
               consent shall not be unreasonably withheld or delayed, erect or
               construct additional buildings or structures ("Additional
               Improvements") on any portion of the Land; (b) make such
               alterations or changes, structural or non-structural, in and to
               the buildings on the Land as it may deem necessary or suitable
               after obtaining the consent of Landlord to the extent required
               under the provisions of Article 14; or (c) after obtaining the
               prior written consent of Landlord, demolish the whole or any part
               of any building at any time standing on the Land; provided that,
               if Tenant obtains Landlord's prior written consent to demolish a
               building on the Land, Tenant will replace the building which was
               demolished with a structure equal to or greater in value than the
               building demolished (the demolition of a building and the
               replacement thereof being referred to in this Article 15 as
               "Demolition Improvements").

               In the event Tenant obtains the prior written consent of Landlord
               for Additional Improvements or Demolition Improvement, the
               following terms and conditions shall be applicable to Tenant's
               making Additional Improvements or Demolition Improvements:

                                      -5-

<PAGE>

          (a) In connection with the design and construction (including
     demolition work, if any) of Additional Improvements or Demolition
     Improvements, Tenant shall comply with and observe all laws, codes, rules,
     regulations and restrictions applicable to (i) such design and construction
     and (ii) the demised premises.

          (b) The erection or construction of neither Additional Improvements
     nor Demolition Improvements shall adversely affect the Value (as
     hereinafter defined) of the demised premises.

          (c) Prior to the commencement of any work to erect or construct
     (including demolition work, if any) Additional Improvements or Demolition
     Improvements, Tenant shall cause to be issued to Landlord an unconditional
     irrevocable sight draft letter of credit ("Letter of Credit") issued by a
     national banking institution acceptable to Landlord in an amount equal to
     125% of the Costs (as hereinafter defined). The term of the Letter of
     Credit shall be for a period extending twelve (12) months beyond the
     Completed Date (as hereinafter defined).

          (d) Completion (as hereinafter defined) of the Additional Improvements
     or Demolition Improvements must occur within 180 days after the Completion
     Date, and, notwithstanding anything to the contrary contained in this
     Lease, Tenant shall be deemed to be in default under the terms of this
     Lease if Completion does not occur within said 180 day period.

          (e) Landlord, as separate covenants with Tenant and without imposing
     conditions on the right of Landlord to draw on the Letter of Credit by
     sight draft or restricting the obligation of the issuing bank to pay upon
     said Letter of Credit upon presentation of a sight draft from Landlord
     identifying the Letter of Credit, shall have the right to draw on the
     Letter of Credit only during the last sixty (60) days of the term of the
     Letter of Credit or at such earlier date on which Tenant shall be in
     default under the terms of this Lease.

          (f) In the event Tenant is in default under the provisions of
     subparagraph (d) of this Article 15, Landlord shall have the right, but not
     the obligation, in its sole discretion, to (i) cause the Additional
     Improvements or Demolition Improvements to be completed in whole or in part
     to the satisfaction of Landlord and/or (ii) cause the Additional
     Improvements or Demolition Improvements to be removed in whole or in part
     from the Land. For the purposes of performing all work which may be
     necessary to the full exercise of the rights granted to Landlord pursuant
     to this subparagraph (f), Landlord, its agents, contractors and consultants
     and their respective agents, employees, contractors and materialmen shall
     have the right to enter upon and use the demised premises without being or
     becoming liable for any damages resulting to Tenant from such actions.

          (g) Landlord may use the proceeds obtained from payment to it on the
     Letter of Credit to pay (i) all costs and expenses of work performed
     pursuant to the provisions of subparagraph (f) of this Article 15,

                                      -6-

<PAGE>

     including but not limited to architectural, engineering and consultant's
     fees, all charges for work performed and materials furnished and reasonable
     fees of independent legal counsel and (ii) all charges for labor performed,
     services rendered and materials furnished in connection with the Additional
     Improvements or Demolition Improvements performed, rendered or furnished
     prior to the date Landlord exercises its rights under subparagraph (f) of
     this Article 15 which have not been paid by Tenant. In the event such
     proceeds are insufficient to make all payments authorized in this
     paragraph, Tenant shall be and remain liable to Landlord for the payment of
     any deficiency. In the event any of such proceeds remain unexpended by
     Landlord thirty (30) days after the last date on which any contractor,
     subcontractor, laborer or materialman who performs labor or furnishes
     labor, material or services in connection with the Additional Improvements
     or Demolition Improvements or work which may be performed pursuant to
     subparagraph (f) could perfect a lien pursuant to the provisions of Chapter
     53 of the Texas Property Code, as amended, such remaining proceeds shall be
     paid to Tenant.

          (h) Upon request from Landlord, Tenant agrees to promptly furnish to
     Landlord such information and documentation relating to the design and
     construction of Additional Improvements of Demolition Improvements and
     Landlord may reasonably request, including but not limited to construction
     contracts and subcontracts, agreements with architects and engineers,
     working plans and specifications, permits and licenses, inspection reports,
     draw requests and cost certifications. Upon Completion, Tenant shall
     furnish to Landlord a complete set of the as-built plans and
     specifications for the Additional Improvements or Demolition Improvements
     and an as-built survey of the demised premises after Completion certified
     to Landlord in substantially the form of the Survey Certificate attached as
     Exhibit "D" to that certain Agreement of Sale dated ______________ between
     Tenant, as Seller, and Landlord, as Buyer, covering the demised premises.

     For the purposes of this Article 15 the term "Completion" is defined to
mean the substantial completion of the Additional Improvements or Demolition
Improvements in accordance with the plans and specifications therefor as
evidenced by (i) a certificate addressed to Landlord and Tenant, in form and
substance acceptable to Landlord, from Tenant's independent architect to the
effect that the Additional Improvements or Demolition Improvements have been
built in accordance with the plans and specifications, are in compliance with
all codes, rules, regulations and restrictions applicable to (x) such
construction or (y) the demised premises and have been substantially completed,
(ii) the issuance to Tenant of a certificate of occupancy for the Additional
Improvements or Demolition Improvements by the governmental authority having
jurisdiction to issue the same and (iii) the written certification by Tenant to
Landlord, in form and substance satisfactory to Landlord, that the Additional
Improvements or Demolition Improvements have been constructed in accordance with
the plans and specifications therefor and in compliance with all laws, codes,
rules, regulations and restrictions applicable thereto, that after Completion
the demised premises are in compliance with all laws, codes,

                                      -7-

<PAGE>

                 rules, regulations and restrictions applicable to the demised
                 premises, that the Additional Improvements and Demolition
                 Improvements do not impair the Value of the demised premises
                 and that all bills and charges for labor performed, services
                 rendered and materials furnished in connection with the
                 Additional Improvements of Demolition Improvements have been
                 paid, said certification to be accompanied by lien waivers or
                 releases from all contractors, subcontractors, materialmen and
                 laborers who performed services or labor or furnished materials
                 with respect to the Additional Improvements or demolition
                 Improvements. The term "Completion Date" is defined for the
                 purposes of this Article 15 as the original date specified in
                 the initial construction contract, before any amendments,
                 modifications or changes thereto or change orders relating
                 thereto, for substantial completion of the Additional
                 Improvements or Demolition Improvements, a copy or which
                 contract shall be furnished by Tenant to Landlord. The term
                 "Costs" is defined for the purposes of this Article 15 to mean
                 the greater of (i) the estimated total costs and expenses
                 (including all "soft costs") of designing and constructing
                 (including demolition costs, if any) the Additional
                 Improvements or Demolition Improvements as submitted in writing
                 to Landlord by Tenant at the time Tenant requests the consent
                 of Landlord as provided in this Article 15 or (ii) if Landlord,
                 in its sole discretion, disagrees with the estimate submitted
                 by Tenant, then such estimated total costs and expenses as
                 Landlord may determine, in its sole discretion, and submit to
                 Tenant within thirty (30) days after receipt of Tenant's
                 estimate. The term "Value" as used in this Article 15 is
                 defined to mean the fair market value of the demised premises
                 assuming the completion of the Additional Improvements or
                 Demolition Improvements, as estimated by Landlord in its sole
                 discretion. The reference to "structural changes", as used in
                 clause (b) of the first paragraph of this Article 15, shall not
                 include the moving of non-loadbearing partitions, minor
                 plumbing or minor electrical work, modification and
                 rearrangement of fixtures or other minor changes.

                           Any costs connected with filing applications for
                 building permits or authorizations for any work permitted under
                 Article 14 or this Article 15, or processing or obtaining the
                 same shall be borne by Tenant. Landlord, at Tenant's cost,
                 shall cooperate with Tenant in securing building or other
                 permits or authorizations required from time to time for any
                 work permitted under Article 14 or this Article 15 or for
                 installations by Tenant permitted under Article 14 or this
                 Article 15.

Utilities
---------                  16. Tenant shall pay all charges for utility services
                 furnished to the demised premises during the Lease Term and
                 Landlord shall not be responsible for any interruption in or
                 termination of any or all of said services.

Govern-
mental
Regula-
tions
-----                      17. (a) Tenant shall, at its own expense, observe and
                 comply with all rules, orders and regulations of all duly
                 constituted public authorities including, without limitation,
                 the environmental laws, rules, regulations and orders referred
                 to in Article 17(b) and all restrictions, covenants, agreement
                 and other matters of record on the date of this Lease effecting
                 the Land and/or the

                                       -8-

<PAGE>

Improvements. Tenant shall have the right to diligently contest, by proper
proceedings conducted reasonably and in good faith and without cost to Landlord,
the validity or application of any such rule, order or regulation and may
postpone compliance therewith until the final determination of any such
proceeding, provided that:

           (i)    Neither the demised premises, nor any part thereof or interest
     therein, would be in any danger of being sold, forfeited, lost of
     interfered with;

           (ii)   Landlord would not be in any danger of any civil or any
     criminal penalty for the failure to comply therewith;

           (iii)  Tenant shall have furnished such security, if any, as may be
     required in any such proceedings or may be requested by Landlord; and

           (iv)   Nothing contained herein shall be construed as providing
     Tenant with the right to contest any sum billed to Tenant by Landlord.

     (b)   "Hazardous Materials" shall mean (a) any "hazardous waste" as defined
by the Resource Conservation and Recovery Act of 1976 ( 42 U.S.C. Section 6901
et seq.), as amended from time to time, and regulations promulgated thereunder;
(b) any "hazardous substance" as defined by the Comprehensive Environmental
Response, Compensation and Liability Act of 1080 ( 42 U.S.C. Section 9601 et
seq.) ("CERLA"), as amended from time to time, and regulations promulgated
thereunder; (c) asbestos; (d) polychlorinated biphenyls; (e) Underground or
above ground storage tanks, whether empty, filled or partially filled with any
substance; (f) any substance the presence of which on the demised premises is
prohibited by any Governmental Requirements; (g) any other substance which by
any Governmental Requirements requires special handling or notification of any
federal, state or local governmental entity in its collection, storage,
treatment, or disposal; (h) urea formaldehyde insulation; (i) "toxic chemicals,"
"hazardous chemicals", or "extremely hazardous substances," under either the
Emergency Planning and Community Right to Know Act of 1986 or the Occupational
Safety and Health Act of 1970; (j) any "pollutant" within the meaning of the
federal Clean Water Act and the regulations promulgated thereunder, including
within the definitions found in 40 CFR (S) 122.2; (k) any "waste" within the
meaning of the Texas Water Code, including within the definition thereof in
Section 26.001; (l) any substance governed by the Toxic Substances Control Act
(15 U.S.C. (S) 2601); and ( m) any "hazardous waste" or "solid waste" within the
meaning of the Texas Solid Waste Act, with particular reference to the
definitions of such terms which appear in TEX. REV. CIV. STAT. ANN. Art. 4477-7,
(S) 2.

           (i) Neither Tenant nor the demised premises shall become subject to
     any private or governmental lien or judicial or administrative notice,
     order or action relating to Hazardous Materials or subject to any public or
     governmental lien or judicial or administrative notice, order or action
     relating to any environmental problems, impairments, or liabilities with
     respect to the demised premises, as a result of Tenant's use of the demised
     premises.

<PAGE>

                        (ii)  Tenant shall immediately notify Landlord should
                    Tenant become aware of (1) any Hazardous Materials in, upon
                    or under the demised premises, (2) any lien, action or
                    notice of the nature described in subparagraph (b) (i) of
                    this Article 17 relating, directly or indirectly, to the
                    demised premises, or (3) any litigation or threat of
                    litigation relating to any alleged unauthorized release of
                    any Hazardous Material from or the existence of any
                    Hazardous Material in, on or under the demised premises.

                        (iii)  Tenant hereby covenants and agrees not to do or
                    take any action or omit or fail to take any such action
                    which will result in the introduction of any Hazardous
                    Materials in, on or under the demised premises.

Liens and
Encumb-
rances
------              18.   Tenant will not, directly or indirectly, create or
                permit to be created or to remain, and will promptly discharge,
                any mortgage, lien, security interest, encumbrance, or charge
                on, pledge of, or conditional sale or other title retention
                agreement with respect to the demised premises or any part
                thereof, Tenant's interest therein, the rents accruing
                hereunder, or any other sum payable to Landlord under this
                Lease. Should any mechanic's or materialman's lien or liens or
                encumbrances or affidavits claiming liens or encumbrances be
                filed against the demised premises, or any part thereof, or
                interest therein, for any reason whatsoever incident to the acts
                or omissions of Tenant, or of any contractor, subcontractor,
                laborer performing labor, or materialmen furnishing materials
                at or for the demised premises or by reason of any specially
                fabricated materials, whether or not placed upon the demised
                premises, Tenant shall cause the same to be canceled or
                discharged of record by payment within fifteen (15) days of the
                filing thereof, or at such earlier time as shall be necessary to
                prevent the foreclosure thereof.

Insurance
---------           19.   Throughout the Lease Term, Tenant shall, at its own
                expense, be obligated to have procured and shall be obligated to
                maintain insurance against loss or damage by fire and such other
                hazards as are included in so-called "extended coverage" and
                against malicious mischief and against such other insurable
                hazards as, under good insurance practices, from time to time
                are insured against for structures similar to the Improvements
                in Dallas, Texas (the "Minimum Insurance"). The amount of such
                insurance shall be not less than eighty percent (80%) of the
                full replacement costs of the Improvements without reduction for
                depreciation. "Full replacement costs", as used in this Article
                19, means the costs of replacing the Improvements; exclusive of
                the costs of excavations, foundations and footings below the
                lowest basement floor.

                    Notwithstanding the foregoing provisions of this Article 19,
                at any time during the Lease Term that Tenant's net worth,
                determined as hereinafter provided in this Article 19, shall
                have exceeded One Hundred Million and No/100 Dollars
                ($100,000,000.00) throughout the immediately preceding fiscal
                year of Tenant (the "Net Worth Requirement"), Tenant shall have
                the right, upon not less than thirty (30) days' prior written
                notice to Landlord and any mortgagee of Landlord, to self-insure
                the Improvements for perils which could be covered by the
                Minimum Insurance. Tenant shall promptly furnish to

                                      -10-

<PAGE>

Landlord, upon Landlord's request, quarterly financial statements for Tenant
prepared in accordance with generally accepted accounting principles and signed
or certified by an officer of Tenant, and Tenant shall furnish to Landlord not
later than June 1 of each year during the Lease Term an annual report, which
will include audited financial statements, for Tenant for the preceding fiscal
year of Tenant ended January 31. Provided each of the financial statements
required to be furnished to Landlord by Tenant reflect Tenant's net worth to be
$100,000,000.00 or more the Net Worth Requirement shall be deemed satisfied;
however, in the event any of the aforesaid financial statements shall reflect a
net worth for Tenant of less than $100,000,000.00, then Landlord may give
written notice to Tenant that Tenant does not satisfy the Net Worth Requirement
and that Tenant must immediately cease to be self insured under this Article 19.
Tenant may not thereafter elect to be self insured under this Article 19 unless
and until the financial statements for Tenant included in an annual report
furnished to Landlord after the date of its notice of non-compliance to Tenant
reflect a net worth for Tenant of $100,000,000.00, or more. Landlord hereby
acknowledges that Tenant has furnished evidence of its satisfaction of the Net
Worth Requirement as of the date of this Lease and that Landlord has been
advised of Tenant's intent to self-insure the Improvements during the Lease
Term; provided that, Tenant continues to satisfy the Net Worth Requirement.
Tenant hereby acknowledges and agrees that during any time that Tenant shall
have failed to obtain and shall fail to maintain the Minimum Insurance in the
amount of not less than eighty percent (80%) of the full replacement cost of the
Improvements, Tenant shall be deemed to be a self-insurer and, in the event of
any casualty loss or damage to any of the Improvements, Tenant shall be
obligated to pay to Landlord, as additional rent, an amount equal to eighty
percent (80%) of the full replacement cost of such Improvements, with such
additional rent being due and payable to Landlord by Tenant upon the first day
of the first month following written notice from Landlord to Tenant of the
amount of additional rent so due and owing by Tenant to Landlord.

     In addition, Tenant shall obtain and keep in force, during and throughout
the Lease Term, a policy of comprehensive public liability insurance insuring
Landlord and Tenant, as their respective interests may appear, against any
liability arising out of the ownership, use, occupancy or maintenance of the
demised premises. Such insurance shall be in an amount of not less than One
Million Dollars ($1,000,000,000.00) for injury to or death of one person in any
one accident or occurrence and in an amount not less than Five Million Dollars
($5,000,000.00) for injury to or death of more than one person. Such insurance
shall further insure Landlord and Tenant against liability for property damage
of at least Five Hundred Thousand Dollars ($500,000.00). The limits of said
insurance shall not, however, limit the liability of Tenant hereunder. In
addition, said policy of comprehensive public liability insurance shall insure
Landlord with respect to the contractual indemnification of Landlord by Tenant
for which provision is made in Article 29 of this Lease. In the event that
Tenant shall fail to secure and maintain said policy of comprehensive public
liability insurance, Landlord may, at Landlord's sole option and without any
requirement with respect thereto, procure and maintain the same; and the cost of
any such policy shall be considered as an operating

                                      -11-

<PAGE>

              expense of Tenant which shall be repaid to Landlord on demand,
              with interest accruing on any sums so expended by Landlord at the
              then highest lawful contract rate which Tenant is authorised to
              pay under the laws of the State of Texas from the date on which
              Landlord expended such sums to the date of payment.
              Notwithstanding the foregoing, so long as Tenant satisfies the Net
              Worth Requirement, Tenant's general corporate public liability
              insurance shall be deemed to satisfy the public liability
              insurance requirements of this Article 19, and Tenant may self
              insure for losses under $50,000,000.00.

                    Policies of insurance procured and maintained pursuant to
              this Article 19 shall be payable to Landlord. Tenant shall furnish
              to Landlord and Landlord's mortgagee, if any, certificates from
              the insuring company showing the existence of the insurance
              required by this Article 19. In case of casualty loss or damage,
              Tenant shall have no right to adjust the loss or execute proof
              thereof in the name of Landlord without the prior written consent
              of Landlord.

Casualty            20.  Should the whole or any part of the demised premises be
--------      partially or totally destroyed by fire or any other casualty after
              the commencement of this Lease, Tenant shall give prompt written
              notice thereof to Landlord, generally describing the nature and
              the extent of such damage. Should over fifty (50%) percent of the
              usable area (as such term is defined in the third subparagraph (a)
              of Article 21) in the building existing on the Land as of the date
              of this Lease be destroyed during the last three years of the
              Lease Term, Tenant shall have the right, at its option, to
              terminate this Lease by giving written notice to Landlord within
              thirty (30) days after the casualty. In the event of the
              termination of this Lease by Tenant as provided in the immediately
              preceding sentence of this Article 20, the following provision
              shall apply:

                         (a) All the insurance proceeds payable as a result of
                    such casualty shall be paid and belong to Landlord. In the
                    event the Improvements are self insured at the time of the
                    loss, Tenant shall pay to Landlord or as Landlord may
                    direct, an amount equivalent to the insurance proceeds that
                    would have been paid had insurance been in force, but not to
                    exceed eighty (80%) percent of the full replacement costs of
                    the Improvements.

                         (b) Tenant shall have sixty (60) days, rent free,
                    within which to remove its property from the demised
                    premises.

                         (c) All unearned rent and other charges paid in advance
                    shall be refunded to Tenant.

              If Tenant does not terminate or does not have the right to
              terminate this Lease as provided above, then the following
              provisions shall be applicable:

                         (a) Within forty-five (45) days after the date of the
                    casualty and before work is commenced to repair or restore
                    the demised premises to substantially the same condition as
                    before the casualty ("Restoration Work"), Tenant shall cause
                    to be issued to Landlord by a national banking institution
                    acceptable to Landlord an unconditional irrevocable sight
                    draft letter of credit ("Letter of

                                      -12-

<PAGE>

Credit") in an amount equal to 125% of the Costs (as hereinafter defined). The
Letter of Credit shall be for a term extending for a period of twelve (12)
months beyond the Completion Date (as hereinafter defined). Notwithstanding
anything to the contrary contained in this Lease, if prior to the date of the
casualty the originally named Landlord herein shall have transferred, conveyed
or assigned the demised premises and/or this Lease to a party which is not an
Affiliate of such Landlord (as the term Affiliate is defined in Article 13)
payment on the Letter of Credit other than during the last sixty (60) days of
the term thereof may be conditioned upon a certification by the then Landlord to
the issuing bank the Tenant is in default under this Lease.

     (b)  All of the insurance proceeds payable under insurance policies
maintained by Tenant pursuant to Article 19 as a result of the casualty shall be
paid to Landlord. In the event the Improvements are self-insured at the time of
the casualty, Tenant shall pay to Landlord on or before the expiration of
forty-five (45) days after the date of the casualty an amount equivalent to the
insurance proceeds that would have been paid had insurance been in force, but
not to exceed eighty (80) percent of the full replacement cost of the
Improvements, unless Tenant shall have theretofore furnished to Landlord the
Letter of Credit.

     (c)  Not later than forty-five (45) days after the date of the casualty,
Tenant shall commence the Restoration Work. Completion (as hereinafter defined)
of the Restoration Work must occur within 180 days after the Completion Date,
and, notwithstanding anything to the contrary contained in this Lease, Tenant
shall be deemed to be in default under the terms of this Lease if Completion
does not occur within said 180 day period. Tenant shall be obligated to repair
and restore the demised premises to substantially the same condition as before
the casualty, notwithstanding the fact that insurance proceeds or proceeds from
self insurance may not be adequate to pay the Costs in full.

     (d)  There shall be no abatement of rental or other charges payable by
Tenant under the terms of this Lease during the period of repairs or
restoration.

     (e)  Landlord, as separate covenants with Tenant and without imposing
conditions on the right of Landlord to draw on the Letter of Credit by sight
draft or restricting the obligation of the issuing bank to pay upon said Letter
of Credit upon presentation of a sight draft from Landlord identifying the
Letter of Credit, shall have the right to draw on the Letter of Credit only
during the last sixty (60) days of the term of the Letter of Credit or at such
earlier date on which Tenant shall be in default under the terms of this Lease.

     (f)  In the event Tenant is in default under the provisions of the second
subparagraph (c) of this Article 20, Landlord shall have the right, but not the
obligation, in its sole discretion, to cause the Restoration Work to be
completed in whole or in part to the satisfaction of Landlord. For the purposes
of

                                      -13-

<PAGE>

     performing all work which may be necessary to the full exercise of the
     rights granted to Landlord pursuant to this subparagraph (f), Landlord, its
     agents, contractors and consultants and their respective agents, employees,
     contractors and materialmen shall have the right to enter upon and use the
     demised premises without being or becoming liable for any damages resulting
     to Tenant from such actions.

           (g)  Landlord may use the insurance proceeds and proceeds obtained
     from payment to it on the Letter of Credit to pay (i) all costs and
     expenses of work performed pursuant to the provisions of subparagraph (f)
     of this Article 20, including but not limited to architectural, engineering
     and consultant's fees, all charges for work performed and materials
     furnished and reasonable fees of independent legal counsel and (ii) all
     charges for labor performed, services rendered and materials furnished in
     connection with the Restoration Work performed, rendered or furnished
     prior to the date Landlord exercises its rights under subparagraph (f) of
     this Article 20 which have not been paid by Tenant. In the event such
     proceeds are insufficient to make all payments authorized in this
     paragraph, Tenant shall be and remain liable to Landlord for the payment
     of any deficiency. In the event any of such proceeds remain unexpended by
     Landlord thirty (30) days after the last date on which any contractor,
     subcontractor, laborer or materialman who performs labor or furnishes
     labor, material or services in connection with the Restoration Work or work
     which may be performed pursuant to subparagraph (f) could perfect a lien
     pursuant to the provisions of Chapter 53 of the Texas Property Code, as
     amended, such remaining proceeds shall be paid to Tenant.

           (h)  Upon request from Landlord, Tenant agrees to promptly furnish to
     Landlord such information and documentation relating to the design and
     construction of Restoration Work as Landlord may reasonably request,
     including but not limited to construction contracts and subcontracts,
     agreements with architects and engineers, working plans and specifications,
     permits and licenses, inspection reports, draw requests and cost
     certifications. Upon Completion, Tenant shall furnish to Landlord a
     complete set of the as-built plans and specifications for the Restoration
     Work and an as-built survey of the demised premises after Completion
     certified to Landlord in substantially the form of the Survey Certificate
     attached as Exhibit "D" to that certain Agreement of Sale dated ___________
     between Tenant, as Seller, and Landlord, as Buyer, covering the demised
     premises.

           (i)  In connection with the design and construction (including
     demolition work, if any) of Restoration Work, Tenant shall comply with and
     observe all laws, codes, rules, regulations, and restrictions applicable to
     (i) such design and construction and (ii) the demised premises.

     For the purposes of this Article 20 the term "Completion" is defined to
mean the substantial completion of the Restoration Work in accordance with the
plans and specifications therefor as evidenced by (i) a certificate

                                      -14-

<PAGE>

          addressed to Landlord and Tenant, in form and substance acceptable to
          Landlord, from Tenant's independent architect to the effect that the
          Restoration Work has been built in accordance with the plans and
          specifications, are in compliance with all codes, rules, regulations
          and restrictions applicable to (x) such construction or (y) the
          demised premises and have been substantially completed, (ii) the
          issuance to Tenant of a certificate of occupancy for the Restoration
          Work by the governmental authority having jurisdiction to issue the
          same and (iii) the written certification by Tenant to Landlord, in
          form and substance satisfactory to Landlord, that the Restoration Work
          has been constructed in accordance with the plans and specifications
          therefor and in compliance with all laws, codes, rules, regulations
          and restrictions applicable thereto, that after Completion the demised
          premises are in compliance with all laws, codes, rules, regulations
          and restrictions applicable to the demised premises, that the
          Restoration Work does not impair the Value of the demised premises and
          that all bills and charges for labor performed, services rendered and
          materials furnished in connection with the Restoration Work have been
          paid, said certification to be accompanied by lien waivers or releases
          from all contractors, subcontractors, materialmen and laborers who
          performed services or labor or furnished materials with respect to the
          Restoration Work. The term "Completion Date" is defined for the
          purposes of this Article 20 as the original date specified in the
          initial construction contract, before any amendments, modifications or
          changes thereto or change orders relating thereto, for substantial
          completion of the Restoration Work, a copy of which contract shall be
          furnished by Tenant to Landlord. The term "Costs" is defined for the
          purposes of this Article 20 to mean the greater of (i) the estimated
          total costs and expenses (including all "soft costs") of designing and
          constructing (including demolition costs, if any) the Restoration Work
          as submitted in writing to Landlord by Tenant prior to commencement of
          the Restoration Work or (ii) if Landlord, in its sole discretion,
          disagrees with the estimate submitted by Tenant, then such estimated
          total costs and expenses as Landlord may determine, in its sole
          discretion, and submit to Tenant within twenty (20) days after receipt
          of Tenant's estimate. The term "Value" as used in this Article 20 is
          defined to mean the fair market value of the demised premises assuming
          the completion of the Restoration Work, as estimated by Landlord in
          its sole discretion.

               Any costs connected with filing applications for building permits
          or authorizations for any work required under this Article 20, or
          processing or obtaining the same shall be borne by Tenant. Landlord,
          at Tenant's cost, shall cooperate with Tenant in securing building or
          other permits or authorizations required from time to time for any
          work required under this Article 20.

Eminent
Domain         21.  As used herein, the term "Taking" refers to a permanent
------    taking during the Lease Term of all or any part of the demised
          premises or of Tenant's leasehold interest with respect thereto, as
          the result of or in lieu of or in  anticipation of the exercise of the
          right of condemnation or of eminent domain for any public or
          quasi-public use under any governmental law, ordinance or regulation
          including, without limitation, a sale to a condemning authority in
          lieu of condemnation. As used herein, the term "Total Taking" shall
          refer to a Taking of the whole

                                      -15-

<PAGE>

     or substantially the whole of the demised premises. As used herein, the
     term "Partial Taking" shall refer to a Taking of less than the whole of the
     Improvements or the demised premises. As used herein, the term "Tender
     Date" shall refer to the earlier of (i) the date physical possession of the
     demised premises or any portion thereof is tendered to the condemning
     authority or (ii) the date physical possession of the demised premises or
     any portion thereof is taken by the condemning authority. As used in
     this Article 21, the term "Restoration Work" is defined to mean the work
     necessary to repair and restore the demised premises to substantially the
     same condition as before the Partial Taking insofar as possible. For the
     purposes of this Article 21 the term "Completion" is defined to mean the
     substantial completion of the Restoration Work in accordance with the plans
     and specifications therefor as evidenced by (i) a certificate addressed to
     Landlord and Tenant, in form and substance acceptable to Landlord, from
     Tenant's independent architect to the effect that the Restoration Work has
     been built in accordance with the plans and specifications, are in
     compliance with all codes, rules, regulations and restrictions applicable
     to (x) such construction or (y) the demised premises and have been
     substantially completed, (ii) the issuance to Tenant of a certificate of
     occupancy for the Restoration Work by the governmental authority having
     jurisdiction to issue the same and (iii) the written certification by
     Tenant to Landlord, in form and substance satisfactory to Landlord, that
     the Restoration Work has been constructed in accordance with the plans and
     specifications therefor and in compliance with all laws, codes, rules,
     regulations and restrictions applicable thereto, that after Completion the
     demised premises are in compliance with all laws, codes, rules,
     regulations and restrictions applicable to the demised premises, and that
     all bills and charges for labor performed, services rendered and materials
     furnished in connection with the Restoration Work have been paid, said
     certification to be accompanied by lien waivers or releases from all
     contractors, subcontractors, materialmen and laborers who performed
     services or labor or furnished materials with respect to the Restoration
     Work. The term "Completion Date" is defined for the purposes of this
     Article 21 as the original date specified in the initial construction
     contract, before any amendments, modifications or changes thereto or change
     orders relating thereto, for substantial completion of the Restoration
     Work, a copy of which contract shall be furnished by Tenant to Landlord.
     The term "Costs" is defined for the purposes of this Article 21 to mean the
     greater of (i) the estimated total costs and expenses (including all "soft
     costs") of designing and constructing (including demolition costs, if any)
     the Restoration Work as submitted in writing to Landlord by Tenant prior to
     commencement of the Restoration Work or (ii) if Landlord, in its sole
     discretion, disagrees with the estimate submitted by Tenant, then such
     estimated total costs and expenses as Landlord may determine, in its sole
     discretion, and submit to Tenant within twenty (20) days after receipt of
     Tenant's estimate. The term "Value" as used in this Article 21 is defined
     to mean the fair market value of the demised premises assuming the
     completion of the Restoration Work, as estimated by Landlord in its sole
     discretion.

            Any costs connected with filing applications for building permits or
     authorizations for any work required under this Article 21, or processing
     or obtaining the same shall be borne by Tenant. Landlord, at Tenant's cost,

                                      -16-

<PAGE>

shall cooperate with Tenant in securing building or other permits or
authorizations required from time to time for any work required under this
Article 21.

        In the event of a Total Taking during the Lease Term, such Total Taking
shall be deemed to have caused this Lease to terminate and the Lease Term to
expire on the Tender Date.

        If at any time during the Lease Term a Partial Taking occurs, then:

                (a)     If the Partial Taking involves a Taking of more than
        75,000 square feet of usable area (as defined in the third paragraph (a)
        of this Article 21) in the building existing on the Land on the date of
        this Lease, Tenant shall have the option to terminate this Lease by
        giving Landlord written notice of such termination within thirty (30)
        days after the Tender Date of the usable area, such termination to be
        effective as of the date of the tender or taking of physical possession.

                (b)     If the Partial Taking results in the total denial of
        access by Tenant to (i) any utility necessary to service the
        demised premises, (ii) all of the parking areas on the Land or (iii) the
        building located on the Land as of the date of this Lease, or if as a
        result of such Partial Taking the parking area or spaces on the demised
        premises remaining after such Partial Taking are inadequate to satisfy
        zoning or parking ordinances or regulations applicable to the demised
        premises as applied to the Improvements existing on the date of this
        Lease or restrictive covenants applicable to the demised premises
        improved only by the Improvements existing on the date of this lease
        (the requirements of which shall be reduced by any modifications or
        waivers thereof made or granted prior to the date of the Partial Taking)
        and substitute or alternate areas for parking necessary to bring the
        demised premises into compliance with such ordinances, regulations or
        restrictive covenants are not available on the demised premises for
        reasons other than the construction of additional buildings or
        structures on the demised premises by Tenant after the date of this
        Lease, Tenant shall have the option to terminate the Lease by giving
        Landlord written notice of such termination within thirty (30) days
        after the Tender Date of that portion of the demised premises involved
        in the Taking, such termination to be effective as of the date of the
        Tender Date.

                (c)     If more than 75,000 square feet of usable area in the
        building existing on the Land as of the date of this Lease is involved
        in the Partial Taking, Landlord shall have the option to terminate this
        Lease by giving Tenant written notice of such termination within thirty
        (30) days after the Tender Date of the usable area, such termination to
        be effective as of the last described date.

        In the event this Lease should be terminated pursuant to this Article
21, any rent paid for occupancy subsequent to the effective termination date
shall be refunded to Tenant, and Tenant shall have sixty (60) days, rent free,
within which to remove its property from the demised premises.

                                      -17-

<PAGE>

          If this Lease is not terminated as provided above in this Article 21
as a result of a Partial Taking, then the following provisions shall be
applicable:

               (a) Within forty-five (45) days after the Tender Date and before
          Restoration Work is commenced Tenant shall cause to be issued to
          Landlord by a national banking institution acceptable to Landlord an
          unconditional irrevocable sight draft letter of credit ("Letter of
          Credit") in an amount equal to 125% of the Costs. The Letter of Credit
          shall be for a term extending for a period of twelve (12) months
          beyond the Completion Date.

               (b) All damages awarded for such Partial Taking shall be
          deposited in an account with a national banking institution acceptable
          to Landlord under the joint control of Landlord and Tenant. Upon
          Completion by Tenant there shall be disbursed from such joint account
          to Tenant an amount up to the Costs, and any balance remaining in the
          joint Account after such disbursement shall be disbursed to Landlord.

               (c) Not later than forty-five (45) days after the Tender Date,
          Tenant shall commence the Restoration Work. Completion of the
          Restoration Work must occur within 180 days after the Completion Date,
          and, notwithstanding anything to the contrary contained in this Lease,
          Tenant shall be deemed to be in default under the terms of this Lease
          if Completion does not occur within said 180 day period. Tenant shall
          be obligated to repair and restore the demised premises to
          substantially the same condition as before the Partial Taking,
          notwithstanding the fact that damages awarded for such Partial Taking
          may not be adequate to pay the Costs in full.

               (d) Landlord, as separate covenants with Tenant and without
          imposing conditions on the right of Landlord to draw on the Letter of
          Credit by sight draft or restricting the obligation of the issuing
          bank to pay upon said Letter of Credit upon presentation of a sight
          draft from Landlord identifying the Letter of Credit, shall have the
          right to draw on the Letter of Credit only during the last sixty (60)
          days of the term of the Letter of Credit or at such earlier date on
          which Tenant shall be in default under the terms of this Lease.

               (e) In the event Tenant is in default under the provisions of the
          second subparagraph (c) of this Article 21, Landlord shall have the
          right, but not the obligation, in its sole discretion, to cause the
          Restoration Work to be completed in whole or in part to the
          satisfaction of Landlord. For the purposes of performing all work
          which may be necessary to the full exercise of the rights granted to
          Landlord pursuant to this subparagraph (e), Landlord, its agents,
          contractors and consultants and their respective agents, employees,
          contractors and materialmen shall have the right to enter upon and use
          the demised premises without being or becoming liable for any damages
          resulting to Tenant from such actions.

                                      -18-

<PAGE>

          (f) Landlord may use the proceeds from the Condemnation Award and
     proceeds obtained from payment to it on the Letter of Credit to pay (i) all
     costs and expenses of work performed pursuant to the provisions of
     subparagraph (e) of this Article 21, including but not limited to
     architectural, engineering and consultant's fees, all charges for work
     performed and materials furnished and reasonable fees of independent legal
     counsel and (ii) all charges for labor performed, services rendered and
     materials furnished in connection with the Restoration Work performed,
     rendered or furnished prior to the date Landlord exercises its rights
     under subparagraph (e) of this Article 21 which have not been paid by
     Tenant. In the event such proceeds are insufficient to make all payments
     authorized in this paragraph, Tenant shall be paid and remain liable to
     Landlord for the payment of any deficiency. In the event any of such
     proceeds remain unexpended by Landlord thirty (30) days after the last date
     on which any contractor, subcontractor, laborer or materialman who performs
     labor or furnishes labor, material or services in connection with the
     Restoration Work or work which may be performed pursuant to subparagraph
     (e) could perfect a lien pursuant to the provision of Chapter 53 of the
     Texas Property Code, as amended, such remaining proceeds shall be paid to
     Tenant.

          (g) Upon request from Landlord, Tenant agrees to promptly furnish to
     Landlord such information and documentation relating to the design and
     construction of Restoration Work as Landlord may reasonably request,
     including but not limited to construction contracts and subcontracts,
     agreements with architects and engineers, working plans and specifications,
     permits and licenses, inspection reports, draw requests and cost
     certifications. Upon Completion, Tenant shall furnish to Landlord a
     complete set of the as-built plans and specifications for the Restoration
     Work and an as-built survey of the demised premises after Completion
     certified to Landlord in substantially the form of the Survey Certificate
     attched as Exhibit "D" to that certain Agreement of Sale dated
     ______________ between Tenant, as Seller, and Landlord, as Buyer, covering
     the demised premises.

          (h) In connection with the design and construction (including
     demolition work, if any) of Restoration Work, Tenant shall comply with and
     observe all laws, codes, rules, regulations and restrictions applicable to
     (i) such design and construction and (ii) the demised premises.

     If a Partial Taking involves less than 75,000 square feet of usable area in
the building existing on the Land on the date of this Lease, then the annual
rent rate payable during the remainder of the Lease Term commencing with the
first day of the first full calendar month following the calendar month in which
the Tender Date occurs shall be the greater of the following:

          (a) The annual rent payable pursuant to the provisions of Article 3
     multiplied by a fraction the numerator of which is the number of square
     feet of usable area remaining in the building existing on the Land after
     the Partial Taking and the denominator of which is the number of square
     feet of usable area in

                                      -19-

<PAGE>

                   such building immediately prior to such Partial Taking. For
                   the purposes of this Article 21, the term "usable area" is
                   defined to mean the gross square footage of building area
                   enclosed within the interior surface of the exterior walls of
                   the building, and, as of the date of this Lease, is deemed to
                   be 470,182 square feet; or

                         (b)  An annual rental computed in accordance with the
                   following formula: ($11,500,000.00 minus Net Award) X Rental
                   Percentage. For the purposes of the above stated formula the
                   term "Net Award" is defined to mean the award made to the
                   Landlord or the proceeds of sale realized by Landlord
                   resulting from a taking for public or quasi-public purposes
                   less (i) attorneys fees and other costs and expenses incurred
                   by Landlord in connection with obtaining the award or
                   consummating the sale and (ii) the portion of such award or
                   proceeds used by Landlord and/or made available to Tenant to
                   pay for or reimburse Tenant for the Costs of Restoration
                   Work. For the purposes of the above stated formula "Rental
                   Percentage" is defined to mean the percentage set forth below
                   for the year in which the Tender Date Occurs:

                         Years 1-5                      9.1 %
                         Years 6-10                     9.5 %
                         Years 11-15                   10.0 %
                         Years 16-20                   10.5 %
                         Years 21-25                   11.0 %
                         1st Renewal option            12.1 %
                         2nd Renewal option            13.3 %
                         3rd Renewal option            14.6 %
                         4th Renewal option            16.1 %
                         5th Renewal option            17.7 %
                         6th Renewal option            19.5 %

                Provided, however, in no event shall the Tenant be required to
                pay rent at an annual rental rate which exceeds the annual
                rental rates set forth in Article 3 of this Lease. There shall
                be no other abatement of rental or other charges payable by
                Tenant as a result of a Partial Taking under this Lease.

                   All damages awarded for a Taking hereunder which results in a
                termination of this Lease shall belong to the Landlord; nothing
                herein contained, however, shall prevent Tenant from claiming,
                proving, collecting (from the condemning authority) and
                retaining any damages separately awarded to the Tenant by the
                condemnor for Tenant's fixtures and leasehold improvements,
                relocation costs, lost business or for any other damage
                separately compensable to Tenant by the condemnor without
                causing or resulting in a reduction of any award to Landlord.
                Landlord makes no representation or warranty that any such
                separate award or compensation is available under applicable
                law.

Assignment
and Subletting
--------------     22.   (a)  Tenant shall not (i) assign this Lease or any
                interest therein, or (ii) sublease the demised premises or any
                portion thereof except in accordance with the terms and
                covenants of this Article 22. Any attempted assignment or
                sublease by Tenant in violation of the terms and covenants of
                this Article 22 shall be void. If Tenant is not a natural
                person, the acquisition of a controlling interest in Tenant
                shall be deemed to be an assignment for

                                      -20-

<PAGE>

purposes hereof. As used herein, the phrase "controlling interest" shall mean
ownership of in excess of forty-nine percent (49%) of the voting interest in
Tenant. Notwithstanding the provisions of this Article 22, Tenant may, upon
written notice to Landlord but without the necessity of obtaining Landlord's
consent and without the necessity to comply with the provisions of subparagraph
(b) of this Article 22, assign this Lease or sublet the demised premises to an
"Affiliate." As used herein, the term "Affiliate" shall mean any entity under
common control of a person or entity which controls Tenant or which is
controlled by Tenant. Notwithstanding any assignment or sublease to an
Affiliate, Tenant shall remain liable for payment of all rents and the
performance and compliance with all other obligations and liabilities imposed
upon Tenant hereunder.

     (b) In the event Tenant desires to assign this Lease or sublet all (but not
less than all) of the demised premises, Tenant shall give Landlord written
notice thereof ("Tenant's Notice"). If, as of the date of Tenant's Notice,
Tenant has received or made a proposal for an assignment of the Lease or a
sublease of the entire demised premises or has had communications with a third
party regarding the same, Tenant's Notice shall identify the party to or from
whom the proposal was made or received or the party with whom Tenant has had
communications regarding a possible assignment or sublease. Landlord may request
from Tenant such additional information and materials relating to the aforesaid
proposal or communications as may be within Tenant's knowledge or control.
During a period of two hundred ten (210) days after receipt of Tenant's Notice
("Negotiation Period"), Landlord shall have an absolute right to negotiate
directly with third parties (including the party or parties identified in
Tenant's Notice) for a lease covering the demised premises. At any time prior to
the expiration of the Negotiation Period, Landlord may terminate this Lease by
giving Tenant written notice of termination ("Landlord's Notice") and this Lease
shall terminate thirty (30) days after the date of Landlord's Notice. In the
event Landlord does not give Landlord's Notice as provided in the immediately
preceding sentence, then from and after the expiration of the Negotiation Period
Tenant shall have the right to assign this Lease or sublease the entire demised
premises (but not less than all of the demised premises) without the necessity
for obtaining Landlord's consent, provided (i) any such assignment or sublease
is subject to the terms and provisions of this Lease, including but not limited
to subparagraphs (c) and (d) of this Article 22 and Article 47 and (ii) Tenant
shall remain primarily liable for payment of all rents and the performance and
compliance with all other obligations and liabilities imposed upon Tenant under
this Lease notwithstanding such assignment or sublease.

     (c)  Notwithstanding the provisions of subparagraphs (a) and (b) of this
Article 22, no assignment of this Lease or sublease of the demised premises
pursuant to the provisions of subparagraphs (a) or (b) of this Article 22 shall
be effective until such time as Landlord receives evidence satisfactory to
Landlord that (i) the proposed subtenant or assignee will use the demised
premises in accordance with Article 47 hereof, for the remainder of the Lease
Term, or for the entire term of any sublease, if such expires prior to the

                                      -21-

<PAGE>

          expiration of the Lease Term; (ii) the occupancy of the demised
          premises by the proposed third party would not increase fire hazards,
          require substantial alterations to the demised premises, or adversely
          affect the reputation and image of the demised premises; and (iii) the
          third party is not owned or controlled by a foreign government,
          involved in lobbying activities, or reputed to be involved in illegal
          or illicit activities.

                        (d)    No assignment or sublease by Tenant permitted
          under the terms of this Article 22 shall be effective until Tenant has
          furnished Landlord with a true and correct copy of the assignment or
          sublease and, with respect to an assignment or sublease pursuant to
          subparagraph (b) of this Article 22, until Landlord has been furnished
          with the evidence as required by subparagraph (c) of this Article 22.
          In the event of an assignment or sublease by Tenant pursuant to the
          provisions of subparagraph (b) of this Article 22, no assignee or
          sublessee or any subsequent assignee or sublessee shall have (i) any
          options to extend the term of this Lease as provided in Article 12
          beyond the expiration of the then current term of this Lease; (ii) any
          right to make Additional Improvements or Demolition Improvements
          pursuant to Article 15; or (iii) any right to self-insure in any of
          the amounts or against any of the perils as provided in Article 19.
          Notwithstanding any assignment or sublease made in compliance with
          this Article 22 or the collection by Landlord of rent from any
          assignee or sublessee, Tenant shall remain primarily 1iable for
          payment of all rents and the performance and compliance with all other
          obligations and liabilities imposed upon Tenant under this Lease.

Signs           23.     During the Lease Term and the continued occupancy of the
-----     entire demised premises by Tenant, the demised premises shall be
          referred to by only such designation as Tenant may indicate. Landlord
          expressly recognizes that Tenant claims the service mark and trademark
          "K mart" as valid and exclusive property of Tenant, and Landlord
          agrees that it shall not either during the Lease Term or thereafter,
          directly or indirectly, contest the validity of said mark "K mart" or
          any of Tenant's registrations pertaining thereto in the United States
          or elsewhere, nor adopt or use said mark or any term, word, mark or
          designation which is in any aspect similar to the mark of Tenant.
          Landlord further agrees that it will not at any time do or cause to be
          done any act or thing directly or indirectly, contesting or in any way
          impairing or tending to impair any part of the Tenant's right, title
          and interest in the aforesaid mark, and Landlord shall not in any
          manner represent that it has ownership interest in the aforesaid mark
          or registrations therefor, and specifically acknowledges that any use
          thereof pursuant to this Lease shall not create in Landlord any right,
          title or interest in the aforesaid mark.

Ingress
and
Egress          24.     Landlord warrants, as a consideration for Tenant
------    entering into this Lease, that it will refrain from taking any steps
          to interfere with the ingress and egress facilities to public streets
          and highways in the number and substantially in the locations existing
          on the date of this Lease, subject to unavoidable temporary closings
          or temporary relocations necessitated by public authority, or other
          circumstances beyond Landlord's control.

                                      -22-

<PAGE>

Landlord's
Remedies
--------                25.  (a) The following events shall be deemed to be
               events of default by Tenant under this Lease: (i) Tenant shall
               fail to pay any rent or other sum of money due hereunder and such
               failure shall continue for a period of ten (10) business days
               after the date such sum is due; (ii) Tenant shall fail to comply
               with any provision of this Lease or any other agreement between
               Landlord and Tenant not requiring the payment of money, all of
               which terms, provisions and covenants shall be deemed material
               and such failure shall continue for a period of thirty (30) days
               after written notice of such default is delivered to Tenant, or
               if such condition cannot reasonably be cured within such thirty
               (30) day period, Tenant shall fail to commence to cure such
               condition within such thirty (30) day period and/or shall
               thereafter fail to prosecute such cure diligently and
               continuously to completion within ninety (90) days of the date of
               Landlord's notice of such default; (iii) the leasehold hereunder
               demised shall be taken on execution or other process of law in
               any action against Tenant; (iv) Tenant shall cease to do business
               in (except for temporary periods necessary to prepare the demised
               premises or a portion thereof for occupancy by an assignee or
               sublessee permitted under the terms of this Lease) or abandon any
               portion of the demised premises; (v) Tenant shall become
               insolvent or unable to pay its debts as they become due, or
               Tenant notifies Landlord that it anticipates either condition; or
               (vi) a receiver or trustee shall be appointed for Tenant's
               leasehold interest in the demised premises or for all or a
               substantial part of the assets of Tenant and such receiver or
               trustee shall not be discharged within (90) days of appointment.

                            (b) Upon the occurrence of any event or events of
               default by Tenant, Landlord shall have the option to pursue any
               one or more of the following remedies without any notice [except
               for such notice expressly required by Article 25(a)(ii) or
               applicable law] or demand for possession whatsoever (and without
               limiting the generality of the foregoing, Tenant hereby
               specifically waives notice and demand for payment of rent or
               other obligations due and waives any and all other notices or
               demand requirements except as imposed by applicable law): (i)
               terminate this Lease, in which event Tenant shall immediately
               surrender the demised premises to Landlord; (ii) terminate
               Tenant's right to occupy the demised premises and re-enter and
               take possession of the demised premises (without terminating this
               Lease); (iii) enter upon the demised premises and do whatever
               Tenant is obligated to do under the terms of this Lease; and
               Tenant agrees to reimburse Landlord on demand for any expenses
               which Landlord may incur in effecting compliance with Tenant's
               obligations under this Lease, and Tenant further agrees that
               landlord shall not be liable for any damages resulting to the
               Tenant from such action; and (iv) exercise all other remedies
               available to Landlord at law or in equity including, without
               limitation, injunctive relief of all varieties.

                            (c) In the event Landlord elects to re-enter or take
               possession of the demised premises after Tenant's default, Tenant
               hereby waives notice of such re-entry or repossession except to
               the extent required by law and of Landlord's intent to re-enter
               or retake possession. Landlord may, without prejudice to any
               other remedy which it may have for possession arrearages in or
               future rent, expel or remove Tenant and any other person who may

                                      -23-

<PAGE>

be occupying said demised premises or any part thereof. The rental provisions
for holding over of Article 32 hereof shall apply with respect to the period
from and after the giving of notice of such repossession by Landlord. In
addition, Landlord may change or alter the locks and other security devices on
the doors to the demised premises after having a notice posted on the demised
premises as to the location of a key to such new locks and any right to obtain
such a key. All Landlord's remedies shall be cumulative and not exclusive.
Forbearance by Landlord to enforce one or more of the remedies herein provided
upon an event of default shall not be deemed or construed to constitute a waiver
of such default.

        (d)  In the event that Landlord elects to terminate this Lease, then,
notwithstanding such termination, Tenant shall be liable for and shall pay to
Landlord the sum of all rents and other indebtedness accrued to the date of such
termination, plus, as damages, an amount equal to the total of (i) the cost of
recovering the demised premises, (ii) the cost of removing land storing Tenant's
and other occupant's property located therein, (iii) the costs of reletting the
demised premises, or portion thereof, (including, without limitation, brokerage
commission), and (iv) the cost of collecting such amounts from Tenant hereunder.

        (e)  In the event that Landlord elects to take possession of the demised
premises and terminate Tenant's right to occupy the demised premises without
terminating this Lease, Tenant shall remain liable, and shall pay to Landlord,
monthly, on demand, any deficiency between the total rental due under this Lease
for the remainder of the Lease Term and rents, if any, which Landlord is able to
collect from another tenant(s) for the demised premises, or portion thereof,
during the remainder of the Lease Term ("Rental Deficiency"). In addition,
Tenant shall be liable for and shall pay to Landlord, on demand, an amount equal
to (i) the cost of recovering possession of the demised premises, (ii) the cost
of removing and storing Tenant's or any other occupant's property located
therein, (iii) the costs of reletting the demised premises, or applicable
portion thereof, whether accomplished in one or more phases (including without
limitation, brokerage alterations and additions to the demised premises, or
applicable portion thereof, whether accomplished in one or more phases,
reasonably required to relet the demised premises, (v) the cost of collection of
the rent accruing from any such reletting, and (vi) the cost of collecting any
sums billable to Tenant by Landlord hereunder. Landlord may file suit to recover
any sums falling due under the terms hereof, from time to time, and no delivery
to or recovery by Landlord of any portion of the sums due Landlord hereunder
shall be any defense in any action to recover any unpaid amount not theretofore
reduced to judgment in favor of Landlord. Landlord shall be obligated to use
reasonable efforts to relet the demised premises by engaging the services of a
management company, leasing agent and/or real estate brokerage firm to attempt
to obtain another tenant or tenants, but the acceptability of a proposed tenant
and the terms and conditions of any such reletting shall be within the sole
discretion of Landlord. Any sums received by Landlord through reletting shall
reduce the sums owing by Tenant to Landlord hereunder, but in no event shall
Tenant be entitled to any excess of any sums obtained by reletting over and
above the sums owing

                                      -24-

<PAGE>

                   by Tenant to Landlord. For the purpose of such reletting,
                   Landlord is authorized to decorate or to make any repairs,
                   changes, alterations, or additions in and to the demised
                   premises or applicable portion thereof, reasonably necessary
                   or advisable to relet the demised premises. No reletting
                   shall be construed as an election on the part of Landlord to
                   terminate this Lease unless a written notice of such
                   intention is given to Tenant by Landlord. Notwithstanding any
                   such reletting without termination, Landlord may at any time
                   thereafter elect to terminate this Lease for such previous
                   default. In the alternative, Landlord may elect to
                   immediately recover as damages, in lieu of the Rental
                   Deficiency, a sum equal to the difference between (i) the
                   total rent due under this Lease for the remainder of the
                   Lease Term, and (ii) the then fair market rental value of the
                   demised premises during such period, discounted to present
                   value at the prime interest rate charged by Chase Manhattan
                   Bank, N.A. as announced or published by such bank as of the
                   date Landlord took possession of the demised premises and
                   terminated Tenant's right to occupy the same ("Discounted
                   Future Rent"). In such event, Landlord shall have no
                   responsibility to attempt to relet the demised premises or to
                   apply any rentals received by Landlord as a result of any
                   such reletting (other than rentals received by Landlord from
                   other tenants for the demised premises prior to the exercise
                   by Landlord of its election to recover damages in lieu of the
                   Rental Deficiency) to Tenant's obligations hereunder; and the
                   aggregate amount of all damages due to Landlord, including
                   the Discounted Future Rent hereunder, shall be immediately
                   due and payable to Landlord upon demand.

                             (f) This Article 25 shall be enforceable to the
                   maximum extent not prohibited by applicable law, and the
                   unenforceability of any portion thereof shall not thereby
                   render unenforceable any other portion. No act or thing done
                   by Landlord or its agents during the Lease Term shall be
                   deemed an acceptance of an attempted surrender of the demised
                   premises, and no agreement to accept a surrender of the
                   demised premises shall be valid unless made in writing and
                   signed by Landlord. No re-entry or taking of possession of
                   the demised premises by Landlord shall be construed as an
                   election on Landlord's part to terminate this Lease unless a
                   written notice of such termination is given to Tenant.

                             (g) Landlord shall be in default hereunder in the
                   event Landlord has not begun and pursued with reasonable
                   diligence the cure of any failure of Landlord to meet its
                   obligations hereunder within ninety (90) days of the receipt
                   by Landlord of written notice from Tenant of the alleged
                   failure to perform. Tenant hereby covenants that, prior to
                   the exercise by Tenant of any remedies to terminate this
                   Lease, it will give the mortgagees holding mortgages on the
                   demised premises notice and a reasonable time to cure any
                   default by Landlord.

Bankruptcy              26.  Article 26 is Intentionally Deleted.
----------

Quiet Enjoyment         27.  Landlord covenants, represents and warrants that it
---------------
                   has full right and power to execute and perform this Lease
                   and to grant the estate demised herein and that Tenant, on
                   payment of the rent and performance of the covenants and
                   agreements hereof, shall peaceably and

                                      -25-

<PAGE>

             quietly have, hold and enjoy the demised premises during the Lease
             Term.

Mortgage
Subor-
dination              28. Tenant accepts this Lease subject and subordinate to
--------     any mortgage, deed of trust or other lien presently existing or
             hereafter arising upon the demised premises, and to any renewals,
             modifications, consolidations, refinancing and extensions thereof,
             but Tenant agrees that any such mortgagee shall have the right at
             any time to subordinate such mortgage, deed of trust or other lien
             to this Lease on such terms and subject to such conditions as such
             mortgagee may deem appropriate in its discretion. Within ten (10)
             business days after written request from Landlord, Tenant agrees to
             execute such further instruments subordinating this Lease or
             attorning to the holder of any such liens as Landlord may request.
             Tenant agrees that it will, within ten (10) business days after
             written request by Landlord execute and deliver to such persons as
             Landlord shall request a statement in the form attached hereto as
             Exhibit "C" furnishing the information required therein and further
             stating such other matters as Landlord shall reasonably require.
             Landlord shall as a condition to Tenant's subordination of the
             Lease as provided herein obtain and deliver to Tenant a
             non-disturbance agreement from any Landlord's mortgagee, similar in
             form and content to the form of Subordination, Non-Disturbance and
             Attornment Agreement attached hereto as Exhibit "D" and made a part
             hereof.

Tenant
Indemnifies
Landlord              29. During the Lease Term, Tenant shall indemnify and save
--------     Landlord harmless against all expenses, losses, costs, penalties,
             claims or demands of whatsoever nature arising from Tenant's use of
             the demised premises, except those which shall result from and are
             in the amount attributable to the willful misconduct or negligence
             of Landlord.

Tenant's
Right to
Cure
Defaults              30. In the event Landlord shall neglect to pay when due
--------     any obligations on any mortgage or encumbrance affecting title to

             the demised premises and to which this Lease shall be subordinate
             and for which Tenant has not received a Subordination Non-
             disturbance and Attornment Agreement, then Tenant may, after the
             continuance of any such default for thirty (30) days after written
             notice thereof by Tenant (specifying the nature of such default),
             pay said principal, interest or other charges all on behalf of and
             at the expense of Landlord, and Landlord shall on demand pay Tenant
             forthwith the amount so paid by Tenant, together with interest
             thereon at the highest lawful contract rate which Landlord is
             authorized to pay under applicable law not to exceed 18% per annum,
             and Tenant may withhold any and all rental payments thereafter due
             to Landlord, and apply the same to the payment of such in-
             debtedness.

Condition
of Premises
at Termina-
tion                  31. At the expiration or earlier termination of the Lease
----         Term, Tenant shall surrender the demised premises, together with
             alterations, additions and improvements then

                                      -26-

<PAGE>

               a part thereof, in good order and condition, ordinary wear, tear
               and use thereof excepted. All trade fixtures located on the
               demised premises on the date of this Lease other than the trade
               fixtures described on Exhibit "F", attached hereto and made a
               part hereof, are and shall remain the property of Landlord. The
               trade fixtures described in Exhibit "F" and all replacements and
               substitutions thereof installed at the expense of Tenant or other
               occupant shall remain the property of Tenant or such other
               occupant, and Tenant shall repair any damage to the buildings
               resulting from their removal; provided however, Tenant shall, at
               any time and from time to time during the Lease Term, have the
               option to relinquish its property rights with respect to such
               trade fixtures, which option shall be exercised by notice of such
               relinquishment to Landlord, and from and after the exercise of
               said option the property specified in said notice shall be the
               property of Landlord.

Holding
Over
----                    32.  In the absence of any written agreement to the
                contrary, if Tenant should remain in occupancy of the demised
                premises after the expiration of the Lease Term or earlier
                termination of this Lease, it shall so remain as a tenant from
                month-to-month and all provisions of this Lease applicable to
                such tenancy shall remain in full force and effect, except that
                rent hereunder shall be at the rate of one hundred fifty percent
                (150%) of the rent payable by Tenant on the last day of the
                Lease Term.

                        33.  This Article 33 is Intentionally Deleted.

Notices                 34.  Notices required under this Lease shall be in
-------          writing and deemed to be properly served on receipt thereof
                 if sent by certified or registered mail to Landlord at the last
                 address where rent was paid, with a copy to 8150  N. Central
                 Expressway, Suite 1201, Dallas, Texas 75206, Attention:
                 Assistant Vice President, Real Estate Investments, and to
                 Metropolitan Life Insurance Company, 5420 LBJ Freeway, Two
                 Lincoln Centre, Suite 1300, Dallas, Texas 75240, Attention:
                 Vice President, Real Estate Investments, or to Tenant at its
                 principal office in Troy, Michigan, Attention: Vice President,
                 Real Estate, or to any subsequent address which Landlord or
                 Tenant shall designate for such purpose. Date of notice shall
                 be the date on which such notice is deposited in a post office
                 of the United States Postal Service.

Captions
and
Definitions             35.  Marginal captions of this Lease are solely for
-----------      convenience of reference and shall not in any way limit or
                 amplify the terms and provisions thereof. The necessary
                 grammatical changes which shall be required to make the
                 provisions of this Lease apply (a) in the plural sense if there
                 shall be more than one Landlord, and (b) to any Landlord which
                 shall be either corporation, an association, a partnership, or
                 an individual, male or female, shall in all instances be
                 assumed as though in each case fully expressed. Unless
                 otherwise provided, upon the termination of this Lease under
                 any of the Articles hereof, the parties hereto shall be
                 relieved of any further liability hereunder except as to acts,
                 omissions or defaults occurring prior to such termination.

                                      -27-

<PAGE>

Successors
and
Assigns
-------            36.  The conditions, covenants and agreements contained in
             this Lease shall be binding upon and inure to the benefit of the
             parties hereto and their respective heirs, executors,
             administrators, successors and assigns. All covenants and
             agreements of this Lease shall run with the Land.

Memorandum
of Lease
--------           37.  The parties hereto have simultaneously with the
             execution and delivery of this Lease executed and delivered a
             Memorandum of Lease which Landlord shall, at its sole expense,
             cause to be recorded within (60) days following delivery of
             this Lease and returned to Tenant by Landlord after return from the
             County Clerk's Office where recorded. Such Memorandum of Lease
             shall be in form and content identical to the form of Memorandum of
             Lease Attached hereto as Exhibit "E" and incorporated herein by
             reference for all purposes. Upon the expiration or termination of
             this Lease and Tenant's removal from the demised premises, whether
             by expiration of the Lease Term, event of default, or otherwise, at
             the written request of Landlord, Tenant shall execute and deliver
             to Landlord a document in form and content acceptable to Landlord,
             which shall be in recordable form, and shall evidence the
             cancellation and termination of this Lease and the Memorandum of
             Lease. Tenant's obligations to execute and deliver such document of
             release shall survive the termination of this Lease and may be
             enforced by Landlord in an action for specific performance of the
             provisions of this Article 37. In addition, Tenant shall indemnify
             and save Landlord harmless from and against any and all losses,
             costs and expenses including, without limitation, reasonable
             attorneys' fees, and other incidental and consequential costs,
             claims, damages or obligations incurred by Landlord and arising out
             of Tenant's failure to execute and deliver such documents as are
             required by this Article 37 within thirty (30) days after being
             requested to do so by Landlord including, without limitation, any
             additional interest, expenses, nonrefundable fees or commissions,
             or other costs and expenses associated with any sale, financing or
             refinancing of any improvements that are delayed or withdrawn
             because of the failure of Tenant to execute and deliver such
             documents to Landlord within the time period specified.

No Waiver
---------           38.  The failure of either Landlord or Tenant to declare an
             event of default immediately upon its occurrence, or delay in
             taking any action in connection with an event of default, shall not
             constitute a waiver of the default, but said party shall have the
             right to declare the default at any time and take such action as is
             lawful or authorized under this Lease.

Estoppel
Certificate        39.  Article 39 is Intentionally Deleted.
-----------

No Brokers
----------         40.  Landlord and Tenant each represents and warrants to the
             other that except as provided for in Article 16 of the Agreement of
             Sale between Landlord and Tenant, dated _________, 1989 (the
             "Contract"), providing for the purchase of the demised premises by
             Landlord from Tenant,

                                      -28-

<PAGE>

              it has not entered into any agreement with, or otherwise had any
              dealings with, any broker or agent in connection with the
              negotiation or execution of this Lease which could form the basis
              of any claim by any such broker or agent for a brokerage fee,
              commission, finder's fee, or any other compensation of any kind or
              nature in connection with the negotiation or execution of this
              Lease, and Landlord and Tenant shall each indemnify and hold
              harmless the other from any costs (including, but not limited to,
              court costs, investigation costs and attorneys' fees), expenses or
              liability for commissions or other compensation claimed by any
              broker or agent with respect to this Lease which arise out of any
              agreement or dealings by such party, or alleged agreement or
              dealings by such party, with any such agent or broker.

Severability     41.  In case any of the provisions of this Lease shall for any
------------  reason be held to be invalid, illegal or unenforceable, such
              invalidity, illegality or unenforceability shall not affect any
              other provision hereof, and this Lease shall be construed as if
              such invalid, illegal or unenforceable provision had never been
              contained herein.

Entire
Agreement        42.  It is expressly agreed by Landlord and Tenant, as a
---------     material consideration for the execution of this Lease, that this
              Lease, with the specific references to written extrinsic
              documents, if any, is the entire agreement of the parties; that
              there are, and were, no verbal representations, warranties,
              understandings, stipulations, agreements or promises pertaining to
              this Lease or the expressly mentioned written extrinsic documents
              not incorporated in writing in this Lease or in the Contract or in
              that certain Agreement dated of even date executed by Tenant and
              containing representations and warranties with respect to
              environmental matters (the "Environmental Certificate"). Landlord
              and Tenant expressly agree that there are and shall be no implied
              warranties of merchantability, habitability, fitness for a
              particular purpose or of any other kind arising out of this Lease
              and there are no warranties which extend beyond those expressly
              set forth in this Lease; except as otherwise provided in the
              Contract or the Environmental Certificate. It is likewise agreed
              that this Lease shall be governed by the laws of the State of
              Texas and may not be altered, waived, amended or extended except
              by an instrument in writing signed by both Landlord and Tenant.

Attorney's
Fees             43.  In the event either party files suit to enforce the
----          performance of or obtain damages caused by a default under any of
              the terms of this Lease, the party against whom a judgment is
              rendered shall pay the prevailing party's reasonable attorneys'
              fees.

Personal
Liability        44.  In no event shall Landlord be liable to Tenant either for
---------     (a) any loss or damage that may be occasioned by or through the
              acts or omissions of Landlord or of any employee or agent of
              Landlord or of any other persons whomsoever, or (b) any
              consequential damages regardless of causation. With respect to
              tort claims against Landlord, Landlord shall not be liable to
              Tenant or to any other person for any act or omission of Landlord
              or of its

                                      -29-

<PAGE>

      repairs thereto (provided Landlord shall never be under any obligation to
      do so) and Tenant shall not be entitled to any abatement or reduction of
      rent by reason thereof.

          IN WITNESS WHEREOF, the parties hereto have executed these presents in
      triplicate and affixed their seals as of the day and year first above
      written.

                                        LANDLORD:

WITNESS:                                METROPOLITAN LIFE INSURANCE COMPANY

___________________________             By:_____________________________________
                                           _____________________________________
                                           Its _________________________________

___________________________

                                        TENANT:

WITNESS:                                K MART CORPORATION

___________________________             By:_____________________________________
                                           _____________________________________
                                           Its /s/ M. L. SKILES. VICE PRESIDENT
                                               ---------------------------------
___________________________

                                      -31-

<PAGE>

                                  EXHIBIT "C"

               THIS LEASE (the "Lease") made and entered into as of the _____
           day of February, 1989 by and between METROPOLITAN LIFE INSURANCE
           COMPANY, a New York corporation having its principal office at One
           Madison Avenue, New York, New York 10010 (herein referred to as
           "Landlord"), and K MART CORPORATION, a Michigan corporation having
           its principal office at 3100 West Big Beaver Road, Troy, Michigan
           48084 (herein referred to as "Tenant"),

               WITNESSETH: That in consideration of the rents, covenants, and
           conditions herein set forth, Landlord and Tenant do hereby covenant,
           promise and agree as follows:

Demised
Premises       1. Without representation or warranty, express or implied,
--------   Landlord does demise unto Tenant and Tenant does take from Landlord,
           for the "Lease Term" (hereinafter defined), the following property:
           That certain tract or parcel of real property which is more
           particularly described on Exhibit "A" attached hereto and made a part
           hereof (the "Land"), together with the building(s) and/or
           improvements existing on the Land on the date hereof and all
           additional buildings and/or improvements hereafter erected or
           constructed on the Land (the "Improvements"); subject, however, to
           the matters listed on Exhibit "B" attached hereto and made a part
           hereof.

               Said Land and Improvements, together with any right, title or
           interest of Landlord in or to any licenses, rights, privileges and
           easements appurtenant thereto, shall be herein after collectively
           referred to as the "demised premises".

Term           2. The term of this lease shall commence upon the date of this
----       Lease (the "Commencement Date") and shall terminate upon such date as
           shall be twenty-five (25) years from the last day of the month during
           which the Commencement Date occurs (the "Initial Lease Term);
           provided however, the term of this Lease may be extended as provided
           in Article 12 hereof. The phrase "Lease Term", as used in this Lease,
           shall mean the Initial Lease Term, together with any extension(s)
           pursuant to Article 12 hereof.

Annual
Rental         3. Tenant shall, during the Lease Term, pay to Landlord, at such
------     place as Landlord shall designate in writing from time to time, an
           annual rental in the following amounts:

               89-94  Years  1-5:   $1,040,910 per annum
               94-99  Years  6-10:  $1,092,956 per annum
               99-01  Years 11-15:  $1,147,604 per annum
               01-09  Years 16-20:  $1,204,984 per annum
               09-19  Years 21-25:  $1,265,233 per annum

               Rental During Option Period
               ---------------------------

               1st five-year option - $1,391,756.00 per annum
               2nd five-year option - $1,530,931.00 per annum
               3rd five-year option - $1,684,024.00 per annum
               4th five-year option - $1,852,427.00 per annum
               5th five-year option - $2,037,670.00 per annum
               6th five-year option - $2,241,437.00 per annum.

<PAGE>

                The annual rentals listed above shall be paid by Tenant to
                Landlord without deduction or offset, except as expressly
                provided in Articles 20 and 21 hereof, in equal monthly
                installments on the first day of each month, in advance,
                commencing on the Commencement Date; provided however, in the
                event the Commencement Date shall not be the first day of a
                calendar month, then the rental for such month shall be prorated
                (on the basis of a rental of $1,040,910.00 per annum) upon a
                daily basis and shall be in addition to rental for the first
                year of the Lease Term in the amount of $1,040,910.00 as
                provided above in this Article 3; it being understood between
                Landlord and Tenant that the first year of the Lease Term shall
                be a period of twelve (12) months, plus the number of days which
                exist between the Commencement Date and the last day of the
                month during which the Commencement Date occurs. The annual
                rental to be paid by Tenant hereunder shall be absolutely net to
                Landlord and free of any operating expenses relative to the
                demised premises, so that this Lease shall yield the annual
                rentals specified above, net to Landlord, throughout the Lease
                Term.

     Real
     Estate
     Tax                4. Tenant shall pay and discharge all ad valorem real
     ---        estate taxes and assessments of any nature which shall be levied
                against the demised premises during the Lease Term.

                        Tenant shall pay and be liable for all sales and use
                taxes and other similar taxes, if any, levied or imposed by any
                city, state, county or other governmental body having authority.
                Tenant shall also be liable for and shall pay all taxes levied
                or assessed against Tenant's property or equipment located in or
                upon the demised premises, or any part thereof. Notwithstanding
                the immediately preceding sentence, Tenant shall not be
                chargeable with, nor be obligated to pay, any income, profit,
                inheritance, estate, succession, gift, franchise or transfer
                taxes which are or may be imposed upon Landlord, its successors
                or assigns, and which do not result from Tenant's use of the
                demised premises, by whatsoever authority imposed or howsoever
                designated.

                        Taxes and assessments payable by Tenant pursuant to this
                Article 4 for the last year of the Lease Term shall be prorated
                based upon actual tax and/or assessments statements, if
                available; otherwise, the proration shall be made based upon the
                most recent tax and/or assessment statements available.

                        Written evidence of the payment by Tenant of taxes and
                assessments pursuant to this Article 4 shall be furnished by
                Tenant to Landlord not later than ten (10) days prior to the
                date upon which any such taxes or assessments would become
                delinquent.

                        Tenant shall have the right to contest, with such right
                to be exercised reasonably and in good faith, the validity or
                the amount of any tax or assessment levied against the demised
                premises by such appellate or other proceedings as may be
                appropriate in the jurisdiction and may defer payment of such
                obligations, pay same under protest, or take such other steps as
                Tenant may reasonably deem appropriate; provided that, (i)
                neither the demised premises, nor any part thereof or interest
                therein, would be, in Landlord's sole opinion, in any danger of
                being sold, forfeited, lost or interfered with, and (ii) Tenant

                                      -2-

<PAGE>

                     shall furnish such security as may be required in any legal
                     proceeding or as shall be reasonably requested by Landlord.
                     Landlord shall cooperate in the institution and prosecution
                     of any such proceedings in a reasonable manner (but without
                     cost or expense to Landlord) and will execute any documents
                     reasonably required therefor. All costs and expenses of
                     such proceedings shall be borne solely by Tenant and any
                     refunds or rebates secured thereby shall belong to Tenant.
                     Tenant shall not withold payment of taxes which will cause
                     any taxing authority to impose a tax lien against the
                     demised premises, or any part thereof, and shall indemnify
                     and hold Landlord harmless from any loss, cost or expense
                     incurrred by Landlord including, without limitation,
                     attorneys' fees, as a result of any such contest(s) or
                     proceeding(s).

                            5.  Article 5 is Intentionally Deleted.

                            6.  Article 6 is Intentionally Deleted.

                            7.  Article 7 is Intentionally Deleted.

                            8.  Article 8 is Intentionally Deleted.

                            9.  Article 9 is Intentionally Deleted.

                            10. Article 10 is Intentionally Deleted.

       Landlord's
       Covenant
       not to
       Build
       -----                11. Landlord covenants that it will not erect any
                     buildings or other structures on the land described in
                     Exhibit "A" during the Lease Term.

       Options
       Extend
       Lease
       -----                12. Tenant shall have the right and option to extend
                     the term of this Lease for six (6) successive additional
                     periods of five (5) years each, such extended term to
                     begin, as the case may be, upon the expiration of the
                     Initial Lease Term or upon the expiration of the then
                     current extension following the expiration of the Initial
                     Lease Term and each such extension shall be upon the same
                     terms and conditions as herein set forth, except as
                     otherwise provided herein. If Tenant shall elect to
                     exercise one or more of the aforesaid option(s), it shall
                     do so, in each case, by giving written notice to Landlord
                     not less than six (6) months prior to the expiration of the
                     then current term of this Lease. Time is of the essence
                     with respect to each notice of Tenant's election to extend
                     the term of this Lease and the failure of Tenant to provide
                     written notice to Landlord on or before six (6) months
                     prior to the expiration of the then current term of this
                     Lease, shall be deemed to be an irrevocable waiver of any
                     further rights of Tenant to extend the term of this Lease.

       Purchase
       Options
       -------              13. Anything in this Lease contained to the contrary
                     nothwithstanding, and without in any manner affecting or
                     limiting any of the rights, options or estates granted to
                     Tenant under this Lease, if the Landlord, at any time
                     during the Lease Term, receives one or more bona fide
                     offers from third parties to purchase the demised premises,
                     and if any such offer is acceptable to the Landlord, then
                     Landlord shall notify Tenant in writing, giving the price,
                     terms and conditions of such offer, and

                                       -3-

<PAGE>

            Tenant shall have ten (10) days from and after the receipt of such
            notice from Landlord in which to elect to purchase the demised
            premises for the consideration and on the terms and conditions
            contained in the bona fide offer. If Tenant does not elect to
            purchase said demised premises and Landlord thereafter sells the
            demised premises, the purchaser shall take the demised premises,
            subject to and burdened with all the terms, provisions and
            conditions of this Lease, excluding this Article 13, the former
            landlord shall be relieved of all obligations hereunder, and the
            rights of the Tenant under this Lease as against the new owner shall
            not be lessened or diminished by reason of the change of ownership.
            Tenant's failure at any time to exercise its option under this
            Article 13 in the manner and within the time period specified above
            shall be deemed to be an irrevocable waiver by Tenant of such
            option. The date of closing of the subject sales transaction and the
            procedure to be followed with respect to the closing of the subject
            transaction shall be as specified in Landlord's notice. The purchase
            option granted to Tenant under this Article 13 shall be personal to
            Tenant and shall terminate upon the assignment of this Lease or the
            subletting of all or any portion of the demised premises by Tenant.
            The provisions of this Article 13 shall not be applicable to the
            transfer, conveyance or assignment, by whatsoever means, of the
            demised premises, or any portion thereof, or interest therein,
            and/or this Lease to an "Affiliate" of Landlord. As used in this
            Article 13, the term "Affiliate" shall mean any person or entity
            under common control of a person or entity which controls Landlord
            or which is controlled by Landlord.

Repairs
-------         14.  Tenant shall, at Tenant's sole cost and expense, undertake
            all maintenance and repairs with respect to the demised premises
            including, without limitation, structural and non-structural repairs
            and replacements, and Tenant shall, during and throughout the Lease
            Term, take good care of the demised premises and maintain the
            demised premises in good, safe and tenantable condition. With
            respect to any structural repairs or replacements, Tenant shall,
            after obtaining Landlord's prior written consent to the extent
            required pursuant to this Article 14, promptly cause all necessary
            structural repairs and replacements to be made in quality and class
            equal to the condition of such structural portions on the date of
            this Lease, and upon completion shall furnish to Landlord "as built"
            plans and specifications for the work so performed. As used herein,
            the phrase "structural portions" refers to the foundation, exterior
            walls, members supporting the roof and the roof, but excludes, by
            way of example and not by way of limitation, interior walls, doors,
            molding, trim, window frames, door frames, closure devices, hardware
            and plate glass. With respect to non-structural repairs or
            replacements, Tenant, after obtaining Landlord's consent to the
            extent required pursuant to this Article 14, shall promptly cause
            all necessary non-structural repairs and replacements to be made in
            quality and class equal to the condition of the demised premises on
            the date of this Lease. In the event that Landlord considers it
            necessary that any maintenance, replacements, renewals or repairs
            required by the provision of this Article 14 be made by Tenant,
            Landlord may request Tenant to undertake such repairs, renewals,
            replacements or maintenance; and upon Tenant's failure or refusal to
            do so promptly, and in any event in case of an emergency, Landlord
            shall have the right, but not the obligation, to perform such
            maintenance or to make such repairs, renewals or replacements,
            Tenant hereby waiving any claim for damage caused thereby. Any

                                      -4-

<PAGE>

               sum so expended by Landlord shall be promptly reimbursed to
               Landlord by Tenant; and any such amount shall bear interest from
               the date on which Landlord expends such sum to the date of
               payment by Tenant at the then highest lawful contract rate which
               Tenant is authorized to pay under applicable law, not to exceed
               18% per annum. Any such sum for which Tenant becomes liable to
               reimburse Landlord may be treated by Landlord as rent and be
               payable to Landlord on the first (1st) day of the next succeeding
               month. In the event that Landlord performs any such maintenance
               or makes any such repairs, renewals or replacements or undertakes
               to do so, Landlord shall not be liable to Tenant for any loss or
               damage which may occur to Tenant's equipment and property located
               within or on the demised premises incident to such action by
               Landlord. Tenant need not obtain the consent of Landlord before
               undertaking repairs or replacements pursuant to this Article 14
               or alterations pursuant to Article 15, provided, in the case of
               non-structural repairs, replacements, changes and alterations,
               the costs of all such non-structural repairs, replacements,
               changes and alterations made during any calendar year do not
               exceed $200,000.00 in the aggregate; and provided, further that
               in the case of structural repairs, replacements, changes and
               alterations, the costs of all such structural repairs,
               replacements, changes and alterations made during any calendar
               year do not exceed $75,000.00 in the aggregate. In the event the
               costs of repairs, replacements, changes and alterations proposed
               to be made would cause the aggregate costs of such repairs,
               replacements and alterations to exceed the limits for a calendar
               year set forth in the immediately preceding sentence of this
               Article 14, then Tenant shall obtain the consent of Landlord to
               such repairs, replacements, changes and alterations proposed to
               be made before the same are commenced, which consent shall not be
               unreasonably withheld or delayed by Landlord.

Alterations
and Addi-
tional Con-
struction               15.   Tenant may, at its own expense at any time,
---------      subject to the conditions hereinafter set forth in this Article
               15, (a) after obtaining the prior written consent of Landlord,
               which consent shall not be unreasonably withheld or delayed,
               erect or construct additional buildings or structures
               ("Additional Improvements") on any portion of the Land; (b) make
               such alterations or changes, structural or non-structural, in and
               to the buildings on the Land as it may deem necessary or suitable
               after obtaining the consent of Landlord to the extent required
               under the provisions of Article 14; or (c) after obtaining the
               prior written consent of Landlord, demolish the whole or any part
               of any building at any time standing on the Land; provided that,
               if Tenant obtains Landlord's prior written consent to demolish a
               building on the Land, Tenant will replace the building which was
               demolished with a structure equal to or greater in value than the
               building demolished (the demolition of a building and the
               replacement thereof being referred to in this Article 15 as
               "Demolition Improvements").

                        In the event Tenant obtains the prior written consent of
               Landlord for Additional Improvements or Demolition Improvements,
               the following terms and conditions shall be applicable to
               Tenant's making Additional Improvements or Demolition
               Improvements:

                                       -5-

<PAGE>

     (a) In connection with the design and construction (including demolition
work, if any) of Additional Improvements or Demolition Improvements, Tenant
shall comply with and observe all laws, codes, rules, regulations and
restrictions applicable to (i) such design and construction and (ii) the demised
premises.

     (b) The erection or construction of neither Additional Improvements nor
Demolition Improvements shall adversely affect the Value (as hereinafter
defined) of the demised premises.

     (c) Prior to the commencement of any work to erect or construct (including
demolition work, if any) Additional Improvements or Demolition Improvements,
Tenant shall cause to be issued to Landlord an unconditional irrevocable sight
draft letter of credit ("Letter of Credit") issued by a national banking
institution acceptable to Landlord in an amount equal to 125% of the Costs (as
hereinafter defined). The term of the Letter of Credit shall be for a period
extending twelve (12) months beyond the Completion Date (as hereinafter
defined).

     (d) Completion (as hereinafter defined) of the Additional Improvements or
Demolition Improvements must occur within 180 days after the Completion Date,
and, notwithstanding anything to the contrary contained in this Lease, Tenant
shall be deemed to be in default under the terms of this Lease if Completion
does not occur within said 180 day period.

     (e) Landlord, as separate covenants with Tenant and without imposing
conditions on the right of Landlord to draw on the Letter of Credit by sight
draft or restricting the obligation of the issuing bank to pay upon said Letter
of Credit upon presentation of a sight draft from Landlord identifying the
Letter of Credit, shall have the right to draw on the Letter of Credit only
during the last sixty (60) days of the term of the Letter of Credit or at such
earlier date on which Tenant shall be in default under the terms of this Lease.

     (f) In the event Tenant is in default under the provisions of subparagraph
(d) of this Article 15, Landlord shall have the right, but not the obligation,
in its sole discretion, to (i) cause the Additional Improvements or Demolition
Improvements to be completed in whole or in part to be satisfaction of Landlord
and/or (ii) cause the Additional Improvements or Demolition Improvements to be
removed in whole or in part from Land. For the purposes of performing all work
which may be necessary to the full exercise of the rights granted to Landlord
pursuant to this subparagraph (f), Landlord, its agents, contractors and
consultants and their respective agents, employees, contractors and materialmen
shall have the right to enter upon and use the demised premises without being or
becoming liable for any damages resulting to Tenant from such actions.

     (g) Landlord may use the proceeds obtained from payment to it on the Letter
of Credit to pay (i) all costs and expenses of work performed pursuant to the
provisions of subparagraph (f) of this Article 15,

                                       -6-

<PAGE>

                    including but not limited to architectural, engineering and
                    consultant's fees, all charges for work performed and
                    materials furnished and reasonable fees of independent legal
                    counsel and (ii) all charges for labor performed, services
                    rendered and materials furnished in connection with the
                    Additional Improvements or Demolition Improvements
                    performed, rendered or furnished prior to the date Landlord
                    exercises its rights under subparagraph (f) of this Article
                    15 which have not been paid by Tenant. In the event such
                    proceeds are insufficient to make all payments authorized in
                    this paragraph, Tenant shall be and remain liable to
                    Landlord for the payment of any deficiency. In the event any
                    of such proceeds remain unexpended by Landlord thirty (30)
                    days after the last date on which any contractor,
                    subcontractor, laborer or materialman who performs labor or
                    furnishes labor, material or services in connection with the
                    Additional Improvements or Demolition Improvements or work
                    which may be performed pursuant to subparagraph (f) could
                    perfect a lien pursuant to the provisions of Chapter 53 of
                    the Texas Property Code, as amended, such remaining proceeds
                    shall be paid to Tenant.

                         (h)  Upon request from Landlord, Tenant agrees to
                    promptly furnish to Landlord such information and
                    documentation relating to the design and construction of
                    Additional Improvements or Demolition Improvements as
                    Landlord may reasonably request, including but not limited
                    to construction contracts and subcontracts, agreements with
                    architects and engineers, working plans and specifications,
                    permits and licenses, inspection reports, draw requests and
                    cost certifications. Upon Completion, Tenant shall furnish
                    to Landlord a complete set of the as-built plans and
                    specifications for the Additional Improvements or Demolition
                    Improvements and an as-built survey of the demised premises
                    after Completion certified to Landlord in substantially the
                    form of the Survey Certificate attached as Exhibit "D" to
                    that certain Agreement of Sale dated ______________ between
                    Tenant, as Seller, and Landlord, as Buyer, covering the
                    demised premises.

                    For the purposes of this Article 15 the term "Completion" is
               defined to mean the substantial completion of the Additional
               Improvements or Demolition Improvements in accordance with the
               plans and specifications therefor as evidenced by (i) a
               certificate addressed to Landlord and Tenant, in form and
               substance acceptable to Landlord, from Tenant's independent
               architect to the effect that the Additional Improvements or
               Demolition Improvements have been built in accordance with the
               plans and specifications, are in compliance with all codes,
               rules, regulations and restrictions applicable to (x) such
               construction or (y) the demised premises and have been
               substantially completed, (ii) the issuance to Tenant of a
               certificate of occupancy for the Additional Improvements or
               Demolition Improvements by the governmental authority having
               jurisdiction to issue the same and (iii) the written
               certification by Tenant to Landlord, in form and substance
               satisfactory to Landlord, that the Additional Improvements or
               Demolition Improvements have been constructed in accordance with
               the plans and specifications therefor and in compliance with all
               laws, codes, rules, regulations and restrictions applicable
               thereto, that after Completion the demised premises are in
               compliance with all laws, codes,

                                      -7-

<PAGE>

                    rules, regulations and restrictions applicable to the
                    demised premises, that the Additional Improvements and
                    Demolition Improvements do not impair the Value of the
                    demised premises and that all bills and charges for labor
                    performed, services rendered and materials furnished in
                    connection with the Additional Improvements or Demolition
                    Improvements have been paid, said certification to be
                    accompanied by lien waivers or releases from all
                    contractors, subcontractors, materialmen and laborers who
                    performed services or labor or furnished materials with
                    respect to the Additional Improvements or Demolition
                    Improvements. The term "Completion Date" is defined for the
                    purposes of this Article 15 as the original date specified
                    in the initial construction contract, before any amendments,
                    modifications or changes thereto or change orders relating
                    thereto, for substantial completion of the Additional
                    Improvements or Demolition Improvements, a copy of which
                    contract shall be furnished by Tenant to Landlord. The term
                    "Costs" is defined for the purposes of this Article 15 to
                    mean the greater of (i) the estimated total costs and
                    expenses (including all "soft costs") of designing and
                    constructing (including demolition costs, if any) the
                    Additional Improvements or Demolition Improvements as
                    submitted in writing to Landlord by Tenant at the time
                    Tenant requests the consent of Landlord as provided in this
                    Article 15 or (ii) if Landlord, in its sole discretion,
                    disagrees with the estimate submitted by Tenant, then such
                    estimated total costs and expenses as Landlord may
                    determine, in its sole discretion, and submit to Tenant
                    within thirty (30) days after receipt of Tenant's estimate.
                    The term "Value" as used in this Article 15 is defined to
                    mean the fair market value of the demised premises assuming
                    the completion of the Additional Improvements or Demolition
                    Improvements, as estimated by Landlord in its sole
                    discretion. The reference to "structural changes", as used
                    in clause (b) of the first paragraph of this Article 15,
                    shall not include the moving of non-loadbearing partitions,
                    minor plumbing or minor electrical work, modification and
                    rearrangement of fixtures or other minor changes.

                         Any costs connected with filing applications for
                    building permits or authorizations for any work permitted
                    under Article 14 or this Article 15, or processing or
                    obtaining the same shall be borne by Tenant. Landlord, at
                    Tenant's cost, shall cooperate with Tenant in securing
                    building or other permits or authorizations required from
                    time to time for any work permitted under Article 14 or this
                    Article 15 or for installations by Tenant permitted under
                    Article 14 or this Article 15.

Utilities                16.  Tenant shall pay all charges for utility services
---------           furnished to the demised premises during the Lease Term and
                    Landlord shall not be responsible for any interruption in or
                    termination of any or all of said services.

Governmental
Regulations              17.  (a) Tenant shall, at its own expense, observe and
-----------         comply with all rules, orders and regulations of all duly
                    constituted public authorities including, without
                    limitation, the environmental laws, rules, regulations and
                    orders referred to in Article 17(b) and all restrictions,
                    covenants, agreements and other matters of record on the
                    date of this Lease effecting the Land and/or the

                                      -8-

<PAGE>

                    Improvements. Tenant shall have the right to diligently
                    contest, by proper proceedings conducted reasonably and in
                    good faith and without cost to Landlord, the validity or
                    application of any such rule, order or regulation and may
                    postpone compliance therewith until the final determination
                    of any such proceeding, provided that:

                              (i)   Neither the demised premises, nor any part
                         thereof, or interest therein, would be in any danger of
                         being sold, forfeited, lost or interfered with;

                              (ii)  Landlord would not be in any danger of any
                         civil or any criminal penalty for the failure to comply
                         therewith;

                              (iii) Tenant shall have furnished such security,
                         if any, as may be required in any such proceedings or
                         may be requested by Landlord; and

                              (iv)  Nothing contained herein shall be construed
                         as providing Tenant with the right to contest any sum
                         billed to Tenant by Landlord.

                         (b)  "Hazardous Materials" shall mean (a) any
                    "hazardous waste" as defined by the Resource Conservation
                    and Recovery Act of 1976 (42 U.S.C. Section 6901 et seq.),
                    as amended from time to time, and regulations promulgated
                    thereunder; (b) any "hazardous substance" as defined by the
                    Comprehensive Environmental Response, Compensation and
                    Liability Act of 1080 (42 U.S.C. Section 9601 et seq.)
                    ("CERCLA"), as amended from time to time, and regulations
                    promulgated thereunder; (c) asbestos; (d) polychlorinated
                    biphenyls; (e) underground or above ground storage tanks,
                    whether empty, filled or partially filled with any
                    substance; (f) any substance the presence of which on the
                    demised premises is prohibited by any Governmental
                    Requirements; (g) any other substance which by any
                    Governmental Requirements requires special handling or
                    notification of any federal, state or local governmental
                    entity in its collection, storage, treatment, or disposal;
                    (h) urea formaldehyde insulation; (i) "toxic chemicals,"
                    "hazardous chemicals", or "extremely hazardous substances,"
                    under either the Emergency Planning and Community Right to
                    Know Act of 1986 or the Occupational Safety and Health Act
                    of 1970; (j) any "pollutant" within the meaning of the
                    federal Clean Water Act and the regulations promulgated
                    thereunder, including within the definitions found in 40 CFR
                    (S) 122.2; (k) any "waste" within the meaning of the Texas
                    Water Code, including within the definition thereof in
                    Section 26.001; (l) any substance governed by the Toxic
                    Substances Control Act (15 U.S.C (S) 2601); and (m) any
                    "hazardous waste" or "solid waste" within the meaning of the
                    Texas Solid Waste Act, with particular reference to the
                    definitions of such terms which appear in TEX. REV. CIV.
                    STAT. ANN. Art. 4477-7, (S) 2.

                              (i)   Neither Tenant nor the demised premises
                         shall become subject to any private or governmental
                         lien or judicial or administrative notice, order or
                         action relating to Hazardous Materials or subject to
                         any public or governmental lien or judicial or
                         administrative notice, order or action relating to any
                         environmental problems, impairments, or liabilities
                         with respect to the demised premises, as a result of
                         Tenant's use of the demised premises.

                                      -9-

<PAGE>

                         (ii)  Tenant shall immediately notify Landlord should
                    Tenant become aware of (1) any Hazardous Materials in, upon
                    or under the demised premises, (2) any lien, action or
                    notice of the nature described in subparagraph (b)(i) of
                    this Article 17 relating, directly or indirectly, to the
                    demised premises, or (3) any litigation or threat of
                    litigation relating to any alleged unauthorized release of
                    any Hazardous Material from or in the existence of any
                    Hazardous Material in, on or under the demised premises.

                         (iii) Tenant hereby covenants and agrees not to do or
                    take any action or omit or fail to take any such action
                    which will result in the introduction of any Hazardous
                    Materials in, on or under the demised premises.

Liens and
Encumbrances
------------        18.  Tenant will not, directly or indirectly, create or
               permit to be created or to remain, and will promptly discharge,
               any mortgage, lien, security interest, encumbrance, or charge on,
               pledge of, or conditional sale or other title retention agreement
               with respect to the demised premises or any part thereof,
               Tenant's interest therein, the rents accruing hereunder, or any
               other sum payable to Landlord under this Lease. Should any
               mechanic's or materialman's lien or liens or encumbrances or
               affidavits claiming liens or encumbrances be filed against the
               demised premises, or any part thereof, or interest therein, for
               any reason whatsoever incident to the acts or omissions of
               Tenant, or of any contractor, subcontractor, laborer performing
               labor, or materialmen furnishing materials at or for the demised
               premises or by reason of any specially fabricated materials,
               whether or not placed upon the demised premises, Tenant shall
               cause the same to be canceled or discharged of record by payment
               within fifteen (15) days of filing thereof, or at such earlier
               time as shall be necessary to prevent the foreclosure thereof.

Insurance           19.  Throughout the Lease Term, Tenant shall, at its own
---------      expense, be obligated to have procured and shall be obligated to
               maintain insurance against loss or damage by fire and such other
               hazards as are included in so-called "extended coverage" and
               against malicious mischief and against such other insurable
               hazards as, under good insurance practices, from time to time are
               insured against for structures similar to the Improvements in
               Dallas, Texas (the "Minimum Insurance"). The amount of such
               insurance shall not be less than eighty percent (80%) of the full
               replacement costs of the Improvements without reduction for
               depreciation. "Full replacement costs", as used in this Article
               19, means the costs of replacing the Improvements; exclusive of
               the cost of excavations, foundations and footings below the
               lowest basement floor.

                    Notwithstanding the foregoing provisions of this Article 19,
               at any time during the Lease Term that Tenant's net worth,
               determined as hereinafter provided in this Article 19, shall have
               exceed One Hundred Million and No/100 Dollars ($100,000,000.00)
               throughout the immediately preceding fiscal year of Tenant (the
               "Net Worth Requirement"), Tenant shall have the right, upon not
               less than thirty (30) days' prior written notice to Landlord and
               any mortgagee of Landlord, to self-insure the Improvements for
               perils which could be covered by the Minimum Insurance. Tenant
               shall promptly furnish to

                                      -10-

<PAGE>

Landlord, upon Landlord's request, quarterly financial statements for Tenant
prepared in accordance with generally accepted accounting principles and signed
or certified by an officer of Tenant, and Tenant shall furnish to Landlord not
later than June 1 of each year during the Lease Term an annual report, which
will include audited financial statements, for Tenant for the preceding fiscal
year of Tenant ended January 31. Provided each of the financial statements
required to be furnished to Landlord by Tenant reflect Tenant's net worth to be
$100,000,000.00 or more the Net Worth Requirement shall be deemed satisfied;
however, in the event any of the aforesaid financial statements shall reflect a
net worth for Tenant of less than $100,000,000.00, then Landlord may give
written notice to Tenant that Tenant does not satisfy the Net Worth Requirement
and that Tenant must immediately cease to be self insured under this Article 19.
Tenant may not thereafter elect to be self insured under this Article 19 unless
and until the financial statements for Tenant included in an annual report
furnished to Landlord after the date of its notice of non-compliance to Tenant
reflect a net worth for Tenant of $100,000,000.00 or more. Landlord hereby
acknowledges that Tenant has furnished evidence of its satisfaction of the Net
Worth Requirement as of the date of this Lease and that Landlord has been
advised of Tenant's intent to self-insure the Improvements during the Lease
Term; provided that, Tenant continues to satisfy the Net Worth Requirement.
Tenant hereby acknowledges and agrees that during any time that Tenant shall
have failed to obtain and shall fail to maintain the Minimum Insurance in the
amount of not less than eighty percent (80%) of the full replacement cost of
the Improvements, Tenant shall be deemed to be self-insurer and, in the event of
any casualty loss or damage to any of the Improvements, Tenant shall be
obligated to pay to Landlord, as additional rent, an amount equal to eighty
percent (80%) of the full replacement cost of such Improvements, with such
additional rent being due and payable to Landlord by Tenant upon the first day
of the first month following written notice from Landlord to Tenant of the
amount of additional rent so due and owing by Tenant to Landlord.

     In addition, Tenant shall obtain and keep in force, during and throughout
the Lease Term, a policy of comprehensive public liability insurance insuring
Landlord and Tenant, as their respective interests may appear, against any
liability arising out of the ownership, use, occupancy or maintenance of the
demised premises. Such insurance shall be in an amount of not less than One
Million Dollars ($1,000,000.00) for injury to or death of one person in any one
accident or occurrence and in an amount not less than Five Million Dollars
($5,000,000.00) for injury to or death of more than one person. Such insurance
shall further insure Landlord and Tenant against liability for property damage
of at least Five Hundred Thousand Dollars ($500,000.00). The limits of said
insurance shall not, however, limit the liability of Tenant hereunder. In
addition, said policy of comprehensive public liability insurance shall insure
Landlord with respect to the contractual indemnification of Landlord by Tenant
for which provision is made in Article 29 of this Lease. In the event that
Tenant shall fail to secure and maintain said policy of comprehensive public
liability insurance, Landlord may, at Landlord's sole option and without any
requirement with respect thereto, procure and maintain the same; and the cost of
any such policy shall be considered as an operating

                                      -11-

<PAGE>

          expense of Tenant which shall be repaid to Landlord on demand, with
          interest accruing on any sums so expended by Landlord at the then
          highest lawful contract rate which Tenant is authorized to pay under
          the laws of the State of Texas from the date on which Landlord
          expended such sums to the date of payment. Notwithstanding the
          foregoing, so long as Tenant satisfies the Net Worth Requirement,
          Tenant's general corporate public liability insurance shall be deemed
          to satisfy the public liability insurance requirements of this Article
          19, and Tenant may self insure for losses under $50,000,000.00.

               Policies of insurance procured and maintained pursuant to this
          Article 19 shall be payable to Landlord. Tenant shall furnish to
          Landlord and Landlord's mortgagee, if any, certificates from the
          insuring company showing the existence of the insurance required by
          this Article 19. In case of casualty loss or damage, Tenant shall have
          no right to adjust the loss or execute proof thereof in the name of
          Landlord without the prior written consent of Landlord.

Casualty       20.  Should the whole or any part of the demised premises be
--------  partially or totally destroyed by fire or any other casualty after the
          commencement of this Lease, Tenant shall give prompt written notice
          thereof to Landlord, generally describing the nature and the extent of
          such damage. Should over fifty (50%) percent of the usable are (as
          such term is defined in the third subparagraph (a) of Article 21) in
          the building existing on the Land as of the date of this Lease be
          destroyed during the last three years of the Lease Term, Tenant shall
          have the right, at its option, to terminate this Lease by giving
          written notice to Landlord within thirty (30) days after the casualty.
          In the event of the termination of this Lease by Tenant as provided in
          the immediately preceding sentence of this Article 20, the following
          provision shall apply:

                    (a)  All the insurance proceeds payable as a result of such
               casualty shall be paid and belong to Landlord. In the event the
               Improvements are self insured at the time of the loss, Tenant
               shall pay to Landlord or as Landlord may direct, an amount
               equivalent to the insurance proceeds that would have been paid
               had insurance been in force, but not to exceed eighty (80%)
               percent of the full replacement costs of the Improvements.

                    (b)  Tenant shall have sixty (60) days, rent free, within
               which to remove its property from the demised premises.

                    (c)  All unearned rent and other charges paid in advance
               shall be refunded to Tenant.

          If Tenant does not terminate or does not have the right to terminate
          this Lease as provided above, then the following provisions shall be
          applicable:

                    (a)  Within forty-five (45) days after the date of the
               casualty and before work is commenced to repair or restore the
               demised premises to substantially the same condition as before
               the casualty ("Restoration Work"), Tenant shall cause to be
               issued to Landlord by a national banking institution acceptable
               to Landlord an unconditional irrevocable sight draft letter of
               credit ("Letter of

                                      -12-

<PAGE>

               Credit") in an amount equal to 125% of the Costs (as hereinafter
               defined). The Letter of Credit shall be for a term extending for
               a period of twelve (12) months beyond the Completion Date (as
               hereinafter defined). Notwithstanding anything to the contrary
               contained in this Lease, if prior to the date of the casualty the
               originally named Landlord herein shall have transferred, conveyed
               or assigned the demised premises and/or this Lease to a party
               which is not an Affiliate of such Landlord (as the term Affiliate
               is defined in Article 13) payment on the Letter of Credit other
               than during the last sixty (60) days of the term thereof may be
               conditioned upon a certification by the then Landlord to the
               issuing bank the Tenant is in default under this Lease.

                    (b)  All of the insurance proceeds payable under insurance
               policies maintained by Tenant pursuant to Article 19 as a result
               of the casualty shall be paid to Landlord. In the event the
               Improvements are self-insured at the time of the casualty, Tenant
               shall pay to Landlord on or before the expiration of forty-five
               (45) days after the date of the casualty an amount equivalent to
               the insurance proceeds that would have been paid had insurance
               been in force, but not to exceed eighty (80) percent of the full
               replacement cost of the Improvements, unless Tenant shall have
               theretofore furnished to Landlord the Letter of Credit.

                    (c)  Not later than forty-five (45) days after the date of
               the casualty, Tenant shall commence the Restoration Work.
               Completion (as hereinafter defined) of the Restoration Work must
               occur within 180 days after the Completion Date, and,
               notwithstanding anything to the contrary contained in this Lease,
               Tenant shall be deemed to be in default under the terms of this
               Lease if Completion does not occur within said 180 day period.
               Tenant shall be obligated to repair and restore the demised
               premises to substantially the same condition as before the
               casualty, notwithstanding the fact that insurance proceeds or
               proceeds from self insurance may not be adequate to pay the Costs
               in full.

                    (d)  There shall be no abatement of rental or other charges
               payable by Tenant under the terms of this Lease during the period
               of repairs or restoration.

                    (e)  Landlord, as separate covenants with Tenant and without
               imposing conditions on the right of Landlord to draw on the
               Letter of Credit by sight draft or restricting the obligation of
               the issuing bank to pay upon said Letter of Credit upon
               presentation of a sight draft from Landlord identifying the
               Letter of Credit, shall have the right to draw on the Letter of
               Credit only during the last sixty (60) days of the term of the
               Letter of Credit or at such earlier date on which Tenant shall be
               in default under the terms of this Lease.

                    (f)  In the event Tenant is in default under the provisions
               of the second subparagraph (c) of this Article 20, Landlord shall
               have the right, but not the obligation, in its sole discretion,
               to cause the Restoration Work to be completed in whole or in part
               to the satisfaction of Landlord. For the purposes of

                                      -13-

<PAGE>

                    performing all work which may be necessary to the full
                    exercise of the rights granted to Landlord pursuant to this
                    subparagraph (f), Landlord, its agents, contractors and
                    consultants and their respective agents, employees,
                    contractors and materialmen shall have the right to enter
                    upon and use the demised premises without being or becoming
                    liable for any damages resulting to Tenant from such
                    actions.

                         (g)  Landlord may use the insurance proceeds and
                    proceeds obtained from payment to it on the Letter of Credit
                    to pay (i) all costs and expenses of work performed pursuant
                    to the provisions of subparagraph (f) of this Article 20,
                    including but not limited to architectural, engineering and
                    consultant's fees, all charges for work performed and
                    materials furnished and reasonable fees of independent legal
                    counsel and (ii) all charges for labor performed, services
                    rendered and materials furnished in connection with the
                    Restoration Work performed, rendered or furnished prior to
                    the date Landlord exercises its rights under subparagraph
                    (f) of this Article 20 which have not been paid by Tenant.
                    In the event such proceeds are insufficient to make all
                    payments authorized in this paragraph, Tenant shall be and
                    remain liable to Landlord for the payment of any deficiency.
                    In the event any of such proceeds remain unexpended by
                    Landlord thirty (30) days after the last date on which any
                    contractor, subcontractor, laborer or materialman who
                    performs labor or furnishes labor, material or services in
                    connection with the Restoration Work or work which may be
                    performed pursuant to subparagraph (f) could perfect a lien
                    pursuant to the provisions of Chapter 53 of the Texas
                    Property code, as amended, such remaining proceeds shall be
                    paid to Tenant.

                         (h)  Upon request from Landlord, Tenant agrees to
                    promptly furnish to Landlord such information and
                    documentation relating to the design and construction of
                    Restoration Work as Landlord may reasonably request,
                    including but not limited to construction contracts and sub-
                    contracts, agreements with architects and engineers,
                    working plans and specifications, permits and licenses,
                    inspection reports, draw requests and cost certifications.
                    Upon Completion, Tenant shall furnish to Landlord a complete
                    set of the as-built plans and specifications for the
                    Restoration Work and an as-built survey of the demised
                    premises after Completion certified to Landlord in
                    substantially the form of the Survey Certificate attached as
                    Exhibit "D" to that certain Agreement of Sale dated
                    _________________ between Tenant, as Seller, and Landlord,
                    as Buyer, covering the demised premises.

                         (i)  In connection with the design and construction
                    (including demolition work, if any) of Restoration Work,
                    Tenant shall comply with and observe all laws, codes, rules,
                    regulations and restrictions applicable to (i) such design
                    and construction and (ii) the demised premises.

                    For the purposes of this Article 20 the term "Completion" is
               defined to mean the substantial completion of the Restoration
               Work in accordance with the plans and specifications therefor
               as evidenced by (i) a certificate

                                      -14-

<PAGE>

               addressed to Landlord and Tenant, in form and substance
               acceptable to Landlord, from Tenant's independent architect to
               the effect that the Restoration Work has been built in accordance
               with the plans and specifications, are in compliance with all
               codes, rules, regulations and restrictions applicable to (x) such
               construction or (y) the demised premises and have been
               substantially completed, (ii) the issuance to Tenant of a
               certificate of occupancy for the Restoration Work by the
               governmental authority having jurisdiction to issue the same and
               (iii) the written certification by Tenant to Landlord, in form
               and substance satisfactory to Landlord, that the Restoration Work
               has been constructed in accordance with the plans and
               specifications therefor and in compliance with all laws, codes,
               rules, regulations and restrictions applicable thereto, that
               after Completion the demised premises are in compliance with all
               laws, codes, rules, regulations and restrictions applicable to
               the demised premises, that the Restoration Work does not impair
               the Value of the demised premises and that all bills and charges
               for labor performed, services rendered and materials furnished in
               connection with the Restoration Work have been paid, said
               certification to be accompanied by lien waivers or releases from
               all contractors, subcontractors, materialmen and laborers who
               performed services or labor or furnished materials with respect
               to the Restoration Work. The term "Completion Date" is defined
               for the purposes of this Article 20 as the original date
               specified in the initial construction contract, before any
               amendments, modifications or changes thereto or change orders
               relating thereto, for substantial completion of the Restoration
               Work, a copy of which contract shall be furnished by Tenant to
               Landlord. The term "Costs" is defined for the purposes of this
               Article 20 to mean the greater of (i) the estimated total costs
               and expenses (including all "soft costs") of designing and
               constructing (including demolition costs, if any) the Restoration
               Work as submitted in writing to Landlord by Tenant prior to
               commencement of the Restoration Work or (ii) if Landlord, in its
               sole discretion, disagrees with the estimate submitted by Tenant,
               then such estimated total costs and expenses as Landlord may
               determine, in its sole discretion, and submit to Tenant within
               twenty (20) days after receipt of Tenant's estimate. The term
               "Value" as used in this Article 20 is defined to mean the fair
               market value of the demised premises assuming the completion of
               the Restoration Work, as estimated by Landlord in its sole
               discretion.

                    Any costs connected with filing applications for building
               permits or authorizations for any work required under this
               Article 20, or processing or obtaining the same shall be borne by
               Tenant. Landlord, at Tenant's cost, shall cooperate with Tenant
               in securing building or other permits or authorizations required
               from time to time for any work required under this Article 20.

Eminent
Domain              21.  As used herein, the term "Taking" refers to a permanent
------         taking during the Lease Term of all or any part of the demised
               premises or of Tenant's leasehold interest with respect thereto,
               as the result of or in lieu of or in anticipation of the exercise
               of the right of condemnation or of eminent domain for any public
               or quasi-public use under any governmental law, ordinance or
               regulation including, without limitation, a sale to a condemning
               authority in lieu of condemnation. As used herein, the term
               "Total Taking" shall refer to a Taking of the whole

                                      -15-

<PAGE>

or substantially the whole of the demised premises. As used herein, the term
"Partial Taking" shall refer to a Taking of less than the whole of the
Improvements or the demised premises. As used herein, the term "Tender Date"
shall refer to the earlier of (i) the date physical possession of the demised
premises or any portion thereof is tendered to the condemning authority or (ii)
the date physical possession of the demised premises or any portion thereof is
taken by the condemning authority. As used in this Article 21, the term
"Restoration Work" is defined to mean the work necessary to repair and restore
the demised premises to substantially the same condition as before the Partial
Taking insofar as possible. For the purposes of this Article 21 the term
"Completion" is defined to mean the substantial completion of the Restoration
Work in accordance with the plans and specifications therefor as evidenced by
(i) a certificate addressed to Landlord and Tenant, in form and substance
acceptable to Landlord, from Tenant's independent architect to the effect that
the Restoration Work has been built in accordance with the plans and
specifications, are in compliance with all codes, rules, regulations and
restrictions applicable to (x) such construction or (y) the demised premises and
have been substantially completed, (ii) the issuance to Tenant of a certificate
of occupancy for the Restoration Work by the governmental authority having
jurisdiction to issue the same and (iii) the written certification by Tenant to
Landlord, in form and substance satisfactory to Landlord, that the Restoration
Work has been constructed in accordance with the plans and specifications
therefor and in compliance with all laws, codes, rules, regulations and
restrictions applicable thereto, that after Completion the demised premises are
in compliance with all laws, codes, rules, regulations and restrictions
applicable to the demised premises, and that all bills and charges for labor
performed, services rendered and materials furnished in connection with the
Restoration Work have been paid, said certification to be accompanied by lien
waivers or releases from all contractors, subcontractors, materialmen and
laborers who performed services or labor or furnished materials with respect to
the Restoration Work. The term "Completion Date" is defined for the purposes of
this Article 21 as the original date specified in the initial construction
contract, before any amendments, modifications or changes thereto or change
orders relating thereto, for substantial completion of the Restoration Work, a
copy of which contract shall be furnished by Tenant to Landlord. The term
"Costs" is defined for the purposes of this Article 21 to mean the greater of
(i) the estimated total costs and expenses (including all "soft costs") of
designing and constructing (including demolition costs, if any) the Restoration
Work as submitted in writing to Landlord by Tenant prior to commencement of the
Restoration Work or (ii) if Landlord, in its sole discretion, disagrees with the
estimate submitted by Tenant, then such estimated total costs and expenses as
Landlord may determine, in its sole discretion, and submit to Tenant within
twenty (20) days after receipt of Tenant's estimate. The term "Value" as used in
this Article 21 is defined to mean the fair market value of the demised premises
assuming the completion of the Restoration Work, as estimated by Landlord in its
sole discretion.

     Any costs connected with filing applications for building permits or
authorizations for any work required under this Article 21, or processing or
obtaining the same shall be borne by Tenant. Landlord, at Tenant's cost,

                                      -16-

<PAGE>

shall cooperate with Tenant in securing building or other permits or
authorizations required from time to time for any work required under this
Article 21.

     In the event of a Total Taking during the Lease Term, such Total Taking
shall be deemed to have caused this Lease to terminate and the Lease Term to
expire on the Tender Date.

     If at any time during the Lease Term a Partial Taking occurs, then:

               (a) If the Partial Taking involves a Taking of more than 75,000
     square feet of usable area (as defined in the third paragraph (a) of this
     Article 21) in the building existing on the Land on the date of this Lease,
     Tenant shall have the option to terminate this Lease by giving Landlord
     written notice of such termination within thirty (30) days after the Tender
     Date of the usable area, such termination to be effective as of the date
     of the tender or taking of physical possession.

               (b) If the Partial Taking results in the total denial of access
     by Tenant to (i) any utility necessary to service the demised premises,
     (ii) all of the parking areas on the Land or (iii) the building located on
     the Land as of the date of this Lease, or if as a result of such Partial
     Taking the parking area or spaces on the demised premises remaining after
     such Partial Taking are inadequate to satisfy zoning or parking ordinances
     or regulations applicable to the demised premises as applied to the
     Improvements existing on the date of this Lease or restrictive covenants
     applicable to the demised premises improved only by the Improvements
     existing on the date of this lease (the requirements of which shall be
     reduced by any modifications or waivers thereof made or granted prior to
     the date of the Partial Taking) and substitute or alternate areas for
     parking necessary to bring the demised premises into compliance with such
     ordinances, regulations or restrictive covenants are not available on the
     demised premises for reasons other than the construction of additional
     buildings or structures on the demised premises by Tenant after the date of
     this Lease, Tenant shall have the option to terminate the Lease by giving
     Landlord written notice of such termination within thirty (30) days after
     the Tender Date of that portion of the demised premises involved in the
     Taking, such termination to be effective as of the date of the Tender Date.

               (c) If more than 75,000 square feet of usable area in the
     building existing on the Land as of the date of this Lease is involved in
     the Partial Taking, Landlord shall have the option to terminate this Lease
     by giving Tenant written notice of such termination within thirty (30) days
     after the Tender Date of the usable area, such termination to be effective
     as of the last described date.

     In the event this Lease shall be terminated pursuant to this Article 21,
any rent paid for occupancy subsequent to the effective termination date shall
be refunded to Tenant, and Tenant shall have sixty (60) days, rent free, within
which to remove its property from the demised premises.

                                      -17-

<PAGE>

                        If this Lease is not terminated as provided above in
                    this Article 21 as a result of a Partial Taking, then the
                    following provisions shall be applicable:

                              (a)   Within forty-five (45) days after the Tender
                        Date and before Restoration Work is commenced Tenant
                        shall cause to be issued to Landlord by a national
                        banking institution acceptable to Landlord an
                        unconditional irrevocable sight draft letter of credit
                        ("Letter of Credit") in an amount equal to 125% of the
                        Costs. The Letter of Credit shall be for a term
                        extending for a period of twelve (12) months beyond the
                        Completion Date.

                              (b)   All damages awarded for such Partial Taking
                        shall be deposited in an account with a national banking
                        institution acceptable to Landlord under the joint
                        control of Landlord and Tenant. Upon Completion by
                        Tenant there shall be disbursed from such joint account
                        to Tenant an amount up to the Costs, and any balance
                        remaining in the joint account after such disbursement
                        shall be disbursed to Landlord.

                              (c)   Not later than forty-five (45) days after
                        the Tender Date, Tenant shall commence the Restoration
                        work. Completion of the Restoration Work must occur
                        within 180 days after the Completion Date, and,
                        notwithstanding anything to the contrary contained in
                        this Lease, Tenant shall be deemed to be in default
                        under the terms of this Lease if Completion does not
                        occur within said 180 day period. Tenant shall be
                        obligated to repair and restore the demised premises to
                        substantially the same condition as before the Partial
                        Taking, notwithstanding the fact that damages awarded
                        for such Partial Taking may not be adequate to pay the
                        Costs in full.

                              (d)   Landlord, as separate covenants with Tenant
                        and without imposing conditions on the right of Landlord
                        to draw on the Letter of Credit by sight draft or
                        restricting the obligation of the issuing bank to pay
                        upon said Letter of Credit upon presentation of a sight
                        draft from Landlord identifying the Letter of Credit,
                        shall have the right to draw on the Letter of Credit
                        only during the last sixty (60) days of the term of the
                        Letter of Credit or at such earlier date on which Tenant
                        shall be in default under the terms of this Lease.

                              (e)   In the event Tenant is in default under the
                        provisions of the second subparagraph (c) of this
                        Article 21, Landlord shall have the right, but not the
                        obligation, in its sole discretion, to cause the
                        Restoration Work to be completed in whole or in part to
                        the satisfaction of Landlord. For the purposes of
                        performing all work which may be necessary to the full
                        exercise of the rights granted to Landlord pursuant to
                        this subparagraph (e), Landlord, its agents, contractors
                        and consultants and their respective agents, employees,
                        contractors and materialmen shall have the right to
                        enter upon and use the demised premises without being or
                        becoming liable for any damages resulting to Tenant from
                        such actions.

                                      -18-

<PAGE>

                 (f) Landlord may use the proceeds from the Condemnation Award
           and proceeds obtained from payment to it on the Letter of Credit to
           pay (i) all costs and expenses of work performed pursuant to the
           provisions of subparagraph (e) of this Article 21, including but not
           limited to architectural, engineering and consultant's fees, all
           charges for work performed and materials furnished and reasonable
           fees of independent legal counsel and (ii) all charges for labor
           performed, services rendered and materials furnished in connection
           with the Restoration work performed, rendered or furnished prior to
           the date Landlord exercises its rights under subparagraph (e) of this
           Article 21 which have not been paid by Tenant. In the event such
           proceeds are insufficient to make all payments authorized in this
           paragraph, Tenant shall be and remain liable to Landlord for the
           payment of any deficiency. In the event any of such proceeds remain
           unexpended by Landlord thirty (30) days after the last date on which
           any contractor, subcontractor, laborer or materialman who performs
           labor or furnishes labor, material or services in connection with the
           Restoration Work or work which may be performed pursuant to
           subparagraph (e) could perfect a lien pursuant to the provisions of
           Chapter 53 of the Texas Property Code, as amended, such remaining
           proceeds shall be paid to tenant.

                 (g) Upon request from Landlord, Tenant agrees to promptly
           furnish to Landlord such information and documentation relating to
           the design and construction of Restoration Work as Landlord may
           reasonably request, including but not limited to construction
           contracts and subcontracts, agreements with architects and engineers,
           working plans and specifications, permits and licenses, inspection
           reports, draw requests and cost certifications. Upon Completion,
           Tenant shall furnish to Landlord a complete set of the as-built plans
           and specifications for the Restoration Work and an as-built survey of
           the demised premises after Completion certified to Landlord in
           substantially the form of the Survey Certificate attached as Exhibit
           "D" to that certain Agreement of Sale dated ____________ between
           Tenant, as Seller, and Landlord, as Buyer, covering the demised
           premises.

                 (h) In connection with the design and construction (including
           demolition work, if any) of Restoration Work, Tenant shall comply
           with and observe all laws, codes, rules, regulations and restrictions
           applicable to (i) such design and construction and (ii) the demised
           premises.

           If a Partial Taking involves less than 75,000 square feet of usable
      area in the building existing on the Land on the date of this Lease, then
      the annual rent rate payable during the remainder of the Lease Term
      commencing with the first day of the first full calendar month following
      the calendar month in which the Tender Date occurs shall be the greater
      of the following:

                 (a) The annual rent payable pursuant to the provisions of
           Article 3 multiplied by a fraction the numerator of which is the
           number of square feet of usable area remaining in the building
           existing on the Land after the Partial Taking and the denominator of
           which is the number of square feet of usable area in

                                      -19-

<PAGE>

                    such building immediately prior to such Partial Taking. For
                    the purposes of this Article 21, the term "usable area" is
                    defined to mean the gross square footage of building area
                    enclosed within the interior surface of the exterior walls
                    of the building, and, as of the date of this Lease, is
                    deemed to be 470,182 square feet; or

                         (b) An annual rental computed in accordance with the
                    following formula: ($11,500,000.00 minus Net Award) X Rental
                    Percentage. For the purposes of the above stated formula the
                    term "Net Award" is defined to mean the award made to the
                    Landlord or the proceeds of sale realized by Landlord
                    resulting from a taking for public or quasi-public purposes
                    less (i) attorneys fees and other costs and expenses
                    incurred by Landlord in connection with obtaining the award
                    or consummating the sale and (ii) the portion of such award
                    or proceeds used by Landlord and/or made available to Tenant
                    to pay for or reimburse Tenant for the Costs of Restoration
                    Work. For the purposes of the above stated formula "Rental
                    Percentage" is defined to mean the percentage set forth
                    below for the year in which the Tender Date occurs:

                             Years 1-5                                 9.1%
                             Years 6-10                                9.5%
                             Years 11-15                              10.0%
                             Years 16-20                              10.5%
                             Years 21-25                              11.0%
                             1st Renewal Option                       12.1%
                             2nd Renewal Option                       13.3%
                             3rd Renewal Option                       14.6%
                             4th Renewal Option                       16.1%
                             5th Renewal Option                       17.7%
                             6th Renewal Option                       19.5%

                    Provided, however, in no event shall the Tenant be required
                    to pay rent at an annual rental rate which exceeds the
                    annual rental rates set forth in Article 3 of this Lease.
                    There shall be no other abatement of rental or other charges
                    payable by Tenant as a result of a Partial Taking under this
                    Lease.

                         All damages awarded for a Taking hereunder which
                    results in a termination of this Lease shall belong to the
                    Landlord; nothing herein contained, however, shall prevent
                    Tenant from claiming, proving, collecting (from the
                    condemning authority) and retaining any damages separately
                    awarded to the Tenant by the condemnor for Tenant's
                    fixtures and leasehold improvements, relocation costs, lost
                    business or for any other damage separately compensable to
                    Tenant by the condemnor without causing or resulting in a
                    reduction of any award to Landlord. Landlord makes no
                    representation or warranty that any such separate award or
                    compensation is available under applicable law.

Assignment
and Sub-
letting                  22. (a) Tenant shall not (i) assign this Lease or any
-------             interest therein, or (ii) sublease the demised premises or
                    any portion thereof except in accordance with the terms and
                    covenants of this Article 22. Any attempted assignment or
                    sublease by Tenant in violation of the terms and covenants
                    of this Article 22 shall be void. If Tenant is not a natural
                    person, the acquisition of a controlling interest in Tenant
                    shall be deemed to be an assignment for

                                      -20-

<PAGE>

purposes hereof. As used herein, the phrase "controlling interest" shall mean
ownership of in excess of forty-nine percent (49%) of the voting interest in
Tenant. Notwithstanding the provisions of this Article 22, Tenant may, upon
written notice to Landlord but without the necessity of obtaining Landlord's
consent and without the necessity to comply with the provisions of subparagraph
(b) of this Article 22, assign this Lease or sublet the demised premises to an
"Affiliate." As used herein, the term "Affiliate" shall mean any entity under
common control of a person or entity which controls Tenant or which is
controlled by Tenant. Notwithstanding any assignment or sublease to Affiliate,
Tenant shall remain liable for payment of all rents and the performance and
compliance with all other obligations and liabilities imposed upon Tenant
hereunder.

        (b)   In the event Tenant desires to assign this Lease or sublet all
(but not less than all) of the demised premises, Tenant shall give Landlord
written notice thereof ("Tenant's Notice").  If, as of the date of Tenant's
Notice, Tenant has received or made a proposal for an assignment of the Lease or
a sublease of the entire demised premises or has had communications with a third
party regarding the same, Tenant's Notice shall identify the party to or from
whom the proposal was made or received or the party with whom Tenant has had
communications regarding a possible assignment or sublease.  Landlord may
request from Tenant such additional information and materials relating to the
aforesaid proposal or communications as may be within Tenant's knowledge or
control.  During a period of two hundred ten (210) days after receipt of
Tenant's Notice ("Negotiation Period"), Landlord shall have an absolute right to
negotiate directly with third (including the party or parties identified in
Tenant's Notice) for a lease covering the demised premises.  At any time prior
to the expiration of the Negotiation Period, Landlord may terminate this Lease
by giving Tenant written notice of termination ("Landlord's Notice") and this
Lease shall terminate thirty (30) days after the date of Landlord's Notice. In
the event Landlord does not give Landlord's Notice as provided in the
immediately preceding sentence, then from and after the expiration of the
Negotiation Period Tenant shall have the right to assign this Lease or sublease
the entire demised premises (but not less than all of the demised premises)
without the necessity for obtaining Landlord's consent, provided (i) any such
assignment or sublease is subject to the terms and provisions of this Lease,
including but not limited to subparagraphs (c) and (d) of this Article 22 and
Article 47 and (ii) Tenant shall remain primarily liable for payment of all
rents and the performance and compliance with all other obligations and
liabilities imposed upon Tenant under this Lease notwithstanding such
assignment or sublease.

        (c)   Notwithstanding the provisions of subparagraphs (a) and (b) of
this Article 22, no assignment of this Lease or sublease of the demised premises
pursuant to the provisions of subparagraphs (a) or (b) of this Article 22 shall
be effective until such time as Landlord receives evidence satisfactory to
Landlord that (i) the proposed subtenant or assignee will use the demised
premises in accordance with Article 47 hereof, for the remainder of the Lease
Term, or for the entire term of any sublease, if such expires prior to the

                                      -21-

<PAGE>

                        expiration of the Lease Term; (ii) the occupancy of the
                        demised premises by the proposed third party would not
                        increase fire hazards, require substantial alterations
                        to the demised premises, or adversely affect the
                        reputation and image of the demised premises; and (iii)
                        the third party is not owned or controlled by a foreign
                        government, involved in lobbying activities, or reputed
                        to be involved in illegal or illicit activities.

                             (d)   No assignment or sublease by Tenant permitted
                        under the terms of this Article 22 shall be effective
                        until Tenant has furnished Landlord with a true and
                        correct copy of the assignment or sublease and, with
                        respect to an assignment or sublease pursuant to
                        subparagraph (b) of this Article 22, until Landlord has
                        been furnished with the evidence as required by
                        subparagraph (c) of this Article 22. In the event of an
                        assignment or sublease by Tenant pursuant to the
                        provisions of subparagraph (b) of this Article 22, no
                        assignee or sublessee or any subsequent assignee or
                        sublessee shall have (i) any options to extend the term
                        of this Lease as provided in Article 12 beyond the
                        expiration of the then current term of this Lease; (ii)
                        any right to make Additional Improvements or Demolition
                        Improvements pursuant to Article 15; or (iii) any right
                        to self-insure in any of the amounts or against any of
                        the perils as provided in Article 19. Notwithstanding
                        any assignment or sublease made in compliance with this
                        Article 22 or the collection by Landlord or rent from
                        any assignee or sublessee, Tenant shall remain primarily
                        liable for payment of all rents and the performance and
                        compliance with all other obligations and liabilities
                        imposed upon Tenant under this Lease.

         Signs
         -----               23.   During the Lease Term and the continued
                        occupancy of the entire demised premises by Tenant, the
                        demised premises shall be referred to by only such
                        designation as Tenant may indicate. Landlord expressly
                        recognizes that Tenant claims the service mark and
                        trademark "K mart" as valid and exclusive property of
                        Tenant, and Landlord agrees that it shall not either
                        during the Lease Term or thereafter, directly or
                        indirectly, contest the validity of said mark "K mart"
                        or any of Tenant's registrations pertaining thereto in
                        the United States or elsewhere, nor adopt or use said
                        mark or any term, word, mark or designation which is in
                        any aspect similar to the mark of Tenant. Landlord
                        further agrees that it will not at any time do or cause
                        to be done any act or thing directly or indirectly,
                        contesting or in any way impairing or tending to impair
                        any part of the Tenant's right, title and interest in
                        the aforesaid mark, and Landlord shall not in any manner
                        represent that it has ownership interest in the
                        aforesaid mark or registrations therefor, and
                        specifically acknowledges that any use thereof pursuant
                        to this Lease shall not create in Landlord any right,
                        title or interest in the aforesaid mark.

         Ingress
         and
         Egress
         ------              24.   Landlord warrants, as a consideration for
                        Tenant entering into this Lease, that it will refrain
                        from taking any steps to interfere with the ingress and
                        egress facilities to public streets and highways in the
                        number and substantially in the locations existing on
                        the date of this Lease, subject to unavoidable temporary
                        closings or temporary relocations necessitated by public
                        authority, or other circumstances beyond Landlord's
                        control.

                                      -22-

<PAGE>

Landlord's
Remedies                25.   (a) The following events shall be deemed to be
--------       events of default by Tenant under this Lease: (i) Tenant shall
               fail to pay any rent or other sum of money due hereunder and such
               failure shall continue for a period of ten (10) business days
               after the date such sum is due; (ii) Tenant shall fail to comply
               with any provision of this Lease or any other agreement between
               Landlord and Tenant not requiring the payment of money, all of
               which terms, provisions and covenants shall be deemed material
               and such failure shall continue for a period of thirty (30) days
               after written notice of such default is delivered to Tenant, or
               if such condition cannot reasonably be cured within such thirty
               (30) day period, Tenant shall fail to commence to cure such
               condition within such (30) day period and/or shall thereafter
               fail to prosecute such cure diligently and continuously to
               completion within ninety (90) days of the date of Landlord's
               notice of such default; (iii) the leasehold hereunder demised
               shall be taken on execution or other process of law in any action
               against Tenant; (iv) Tenant shall cease to do business in (except
               for temporary periods necessary to prepare the demised premises
               or a portion thereof for occupancy by an assignee or sublessee
               permitted under the terms of this Lease) or abandon any portion
               of the demised premises; (v) Tenant shall become insolvent or
               unable to pay its debts as they become due, or Tenant notifies
               Landlord that it anticipates either condition; or (vi) a receiver
               or trustee shall be appointed for Tenant's leasehold interest in
               the demised premises or for all or a substantial part of the
               assets of Tenant and such receiver or trustee shall not be
               discharged within (90) days of appointment.

                        (b)   Upon the occurrence of any event or events of
               default by Tenant, Landlord shall have the option to pursue any
               one or more of the following remedies without any notice (except
               for such notice expressly required by Article 25(a)(ii) or
               applicable law) or demand for possession whatsoever (and without
               limiting the generality of the foregoing, Tenant hereby
               specifically waives notice and demand for payment of rent or
               other obligations due and waives any and all other notices or
               demand requirements except as imposed by applicable law): (i)
               terminate this Lease, in which event Tenant shall immediately
               surrender the demised premises to Landlord; (ii) terminate
               Tenant's right to occupy the demised premises and re-enter and
               take possession of the demised premises (without terminating this
               Lease); (iii) enter upon the demised premises and do whatever
               Tenant is obligated to do under the terms of this Lease; and
               Tenant agrees to reimburse Landlord on demand for any expenses
               which Landlord may incur in effecting compliance with Tenant's
               obligations under this Lease, and Tenant further agrees that
               Landlord shall not be liable for any damages resulting to the
               Tenant from such action; and (iv) exercise all other remedies
               available to Landlord at law or in equity including, without
               limitation, injunctive relief of all varieties.

                        (c)   In the event Landlord elects to re-enter or take
               possession of the demised premises after Tenant's default, Tenant
               hereby waives notice of such re-entry or repossession except to
               the extent required by law and of Landlord's intent to re-enter
               or retake possession. Landlord may, without prejudice to any
               other remedy which it may have for possession or arrearages in or
               future rent, expel or remove Tenant and any other person who may

                                      -23-

<PAGE>

               be occupying said demised premises or any part thereof. The
               rental provisions for holding over of Article 32 hereof shall
               apply with respect to the period from and after the giving of
               notice of such repossession by Landlord. In addition, Landlord
               may change or alter the locks and other security devices on the
               doors to the demised premises after having a notice posted on the
               demised premises as to the location of a key to such new locks
               and any right to obtain such a key. All Landlord's remedies shall
               be cumulative and not exclusive. Forbearance by Landlord to
               enforce one or more of the remedies herein provided upon an event
               of default shall not be deemed or construed to constitute a
               waiver of such default.

                        (d)   In the event that Landlord elects to terminate
               this Lease, then, notwithstanding such termination, Tenant shall
               be liable for and shall pay to Landlord the sum of all rents and
               other indebtedness accrued to the date of such termination, plus,
               as damages, an amount equal to the total of (i) the cost of
               recovering the demised premises, (ii) the cost of removing and
               storing Tenant's and other occupant's property located therein,
               (iii) the costs of reletting the demised premises, or portion
               thereof (including, without limitation, brokerage commissions),
               and (iv) the cost of collecting such amounts from Tenant
               hereunder.

                        (e)   In the event that Landlord elects to take
               possession of the demised premises and terminate Tenant's right
               to occupy the demised premises without terminating this Lease,
               Tenant shall remain liable, and shall pay to Landlord, monthly,
               on demand, any deficiency between the total rental due under this
               Lease for the remainder of the Lease Term and rents, if any,
               which Landlord is able to collect from another tenant(s) for the
               demised premises, or portion thereof, during the remainder of the
               Lease Term ("Rental Deficiency"). In addition, Tenant shall be
               liable for and shall pay to Landlord, on demand, an amount equal
               to (i) the cost of recovering possession of the demised premises,
               (ii) the cost of removing and storing Tenant's or any other
               occupant's property located therein, (iii) the costs of reletting
               the demised premises, or applicable portion thereof, whether
               accomplished in one or more phases (including without limitation,
               brokerage commissions), (iv) the cost of decorations, changes,
               alterations and additions to the demised premises, or applicable
               portion thereof, whether accomplished in one or more phases,
               reasonably required to relet the demised premises, (v) the cost
               of collection of the rent accruing from any such reletting, and
               (vi) the cost of collecting any sums billable to Tenant by
               Landlord hereunder. Landlord may file suit to recover any sums
               falling due under the terms hereof, from time to time, and no
               delivery to or recovery by Landlord of any portion of the sums
               due Landlord hereunder shall be any defense in any action to
               recover any unpaid amount not theretofore reduced to judgment in
               favor of Landlord. Landlord shall be obligated to use reasonable
               efforts to relet the demised premises by engaging the services of
               a management company, leasing agent and/or real estate brokerage
               firm to attempt to obtain another tenant or tenants, but the
               acceptability of a proposed tenant and the terms and conditions
               of any such reletting shall be within the sole discretion of
               Landlord. Any sums received by Landlord through reletting shall
               reduce the sums owing by Tenant to Landlord hereunder, but in no
               event shall Tenant be entitled to any excess of any sums obtained
               by reletting over and above the sums owing

                                      -24-

<PAGE>

                    by Tenant to Landlord. For the purpose of such reletting,
                    Landlord is authorized to decorate or to make any repairs,
                    changes, alterations, or additions in and to the demised
                    premises or applicable portion thereof, reasonably necessary
                    or advisable to relet the demised premises. No reletting
                    shall be construed as an election on the part of Landlord to
                    terminate this Lease unless a written notice of such
                    intention is given to Tenant by Landlord. Notwithstanding
                    any such reletting without termination, Landlord may at any
                    time thereafter elect to terminate this Lease for such
                    previous default. In the alternative, Landlord may elect to
                    immediately recover as damages, in lieu of the Rental
                    Deficiency, a sum equal to the difference between (i) the
                    total rent due under this Lease for the remainder of the
                    Lease Term, and (ii) the then fair market rental value of
                    the demised premises during such period, discounted to
                    present value at the prime interest rate charged by Chase
                    Manhattan Bank, N.A. as announced or published by such bank
                    as of the date Landlord took possession of the demised
                    premises and terminated Tenant's right to occupy the same
                    ("Discounted Future Rent"). In such event, Landlord shall
                    have no responsibility to attempt to relet the demised
                    premises or to apply any rentals received by Landlord as a
                    result of any such reletting (other than rentals received by
                    Landlord from other tenants for the demised premises prior
                    to the exercise by Landlord of its election to recover
                    damages in lieu of the Rental Deficiency) to Tenant's
                    obligations hereunder; and the aggregate amount of all
                    damages due to Landlord, including the Discounted Future
                    Rent hereunder, shall be immediately due and payable to
                    Landlord upon demand.

                            (f) This Article 25 shall be enforceable to the
                    maximum extent not prohibited by applicable law, and the
                    unenforceability of any portion thereof shall not thereby
                    render unenforceable any other portion. No act or thing done
                    by Landlord or its agents during the Lease Term shall be
                    deemed an acceptance of an attempted surrender of the
                    demised premises, and no agreement to accept a surrender of
                    the demised premises shall be valid unless made in writing
                    and signed by Landlord. No re-entry or taking of possession
                    of the demised premises by Landlord shall be construed as an
                    election on Landlord's part to terminate this Lease unless a
                    written notice of such termination is given to Tenant.

                            (g) Landlord shall be in default hereunder in the
                    event Landlord has not begun and pursued with reasonable
                    diligence the cure of any failure of Landlord to meet its
                    obligations hereunder within ninety (90) days of the receipt
                    by Landlord of written notice from Tenant of the alleged
                    failure to perform. Tenant hereby covenants that, prior to
                    the exercise by Tenant of any remedies to terminate this
                    Lease, it will give the mortgagees holding mortgages on the
                    demised premises notice and a reasonable time to cure any
                    default by Landlord.

Bank-
ruptcy                  26. Article 26 is Intentionally Deleted.
------

Quiet
Enjoyment               27. Landlord covenants, represents and warrants that it
---------           has full right and power to execute and perform this Lease
                    and to grant the estate demised herein and that Tenant, on
                    payment of the rent and performance of the covenants and
                    agreements hereof, shall peaceably and

                                       -25-

<PAGE>

                    quietly have, hold and enjoy the demised premises during the
                    Lease Term.

Mortgage
Subor-
dination                  28.  Tenant accepts this Lease subject and subordinate
--------            to any mortgage, deed of trust or other lien presently
                    existing or hereafter arising upon the demised premises, and
                    to any renewals, modifications, consolidations, refinancing
                    and extensions thereof, but Tenant agrees that any such
                    mortgagee shall have the right at any time to subordinate
                    such mortgage, deed of trust or other lien to this Lease on
                    such terms and subject to such conditions as such mortgagee
                    may deem appropriate in its discretion. Within ten (10)
                    business days after written request from Landlord, Tenant
                    agrees to execute such further instruments subordinating
                    this Lease or attorning to the holder of any such liens as
                    Landlord may request. Tenant agrees that it will, within ten
                    (10) business days after written request by Landlord,
                    execute and deliver to such persons as Landlord shall
                    request a statement in the form attached hereto as Exhibit
                    "C" furnishing the information required therein and further
                    stating such other matters as Landlord shall reasonably
                    require. Landlord shall as a condition to Tenant's
                    subordination of the Lease as provided herein obtain and
                    deliver to Tenant a non-disturbance agreement from any
                    Landlord's mortgage, similar in form and content to the form
                    of Subordination, Non-Disturbance and Attornment Agreement
                    attached hereto as Exhibit "D" and made a part hereof.

Tenant
Indemnifies
Landlord                  29.  During the Lease Term, Tenant shall indemnify and
--------            save Landlord harmless against all expenses, losses, costs,
                    penalties, claims or demands of whatsoever nature arising
                    from Tenant's use of the demised premises, except those
                    which shall result from and are in the amount attributable
                    to the willful misconduct or negligence of Landlord.

Tenant's
Right to
Cure
Defaults                  30.  In the event Landlord shall neglect to pay when
--------            due any obligations on any mortgage or encumbrance affecting
                    title to the demised premises and to which this Lease shall
                    be subordinate and for which Tenant has not received a
                    Subordination Non-disturbance and Attornment Agreement, then
                    Tenant may, after the continuance of any such default for
                    thirty (30) days after written notice thereof by Tenant
                    (specifying the nature of such default), pay said principal,
                    interest or other charges all on behalf of and at the
                    expense of Landlord, and Landlord shall on demand pay Tenant
                    forthwith the amount so paid by Tenant, together with
                    interest thereon at the highest lawful contract rate which
                    Landlord is authorized to pay under applicable law not to
                    exceed 18% per annum, and Tenant may withhold and all
                    rental payments thereafter due to Landlord, and apply the
                    same to the payment of such indebtedness.

Condition
of Premises
at Termina-
tion                      31.  At the expiration or earlier termination of the
----                Lease Term, Tenant shall surrender the demised premises,
                    together with alterations, additions and improvements then

                                      -26-

<PAGE>

            a part thereof, in good order and condition, ordinary wear, tear and
            use thereof excepted. All trade fixtures located on the demised
            premises on the date of this Lease other than the trade fixtures
            described on Exhibit "F", attached hereto and made a part hereof,
            are and shall remain the property of Landlord. The trade fixtures
            described in Exhibit "F" and all replacements and substitutions
            thereof installed at the expense of Tenant or other occupant shall
            remain the property of Tenant or such other occupant, and Tenant
            shall repair any damage to the buildings resulting from their
            removal; provided however, Tenant shall, at any time and from time
            to time during the Lease Term, have the option to relinquish its
            property rights with respect to such trade fixtures, which option
            shall be exercised by notice of such relinquishment to Landlord, and
            from and after the exercise of said option the property specified in
            said notice shall be the property of Landlord.

Holding
Over             32.  In the absence of any written agreement to the contrary,
----        if Tenant should remain in occupancy of the demised premises after
            the expiration of the Lease Term or earlier termination of this
            Lease, it shall so remain as a tenant from month-to-month and all
            provisions of this Lease applicable to such tenancy shall remain in
            full force and effect, except that rent hereunder shall be at the
            rate of one hundred fifty percent (150%) of the rent payable by
            Tenant on the last day of the Lease Term.

                 33.  This Article 33 is Intentionally Deleted.

Notices          34.  Notices required under this Lease shall be in writing and
-------     deemed to be properly served on receipt thereof if sent by certified
            or registered mail to Landlord at the last address where rent was
            paid, with a copy to 8150 N. Central Expressway, Suite 1201, Dallas,
            Texas 75206, Attention: Assistant Vice President, Real Estate
            Investments, and to Metropolitan Life Insurance Company, 5420 LBJ
            Freeway, Two Lincoln Centre, Suite 1300, Dallas, Texas 75240,
            Attention: Vice President, Real Estate Investments, or to Tenant at
            its principal office in Troy, Michigan, Attention: Vice President,
            Real Estate, or to any subsequent address which Landlord or Tenant
            shall designate for such purpose. Date of notice shall be the date
            on which such notice is deposited in a post office of the United
            States Postal Service.

Captions
and
Defini-
tions            35.  Marginal captions of this Lease are solely for convenience
-----       of reference and shall not in any way limit or amplify the terms and
            provisions thereof. The necessary grammatical changes which shall be
            required to make the provisions of this Lease apply (a) in the
            plural sense if there shall be more than one Landlord, and (b) to
            any landlord which shall be either corporation, an association, a
            partnership, or an individual, male or female, shall in all
            instances be assumed as though in each case fully expressed. Unless
            otherwise provided, upon the termination of this Lease under any of
            the Articles hereof, the parties hereto shall be relieved of any
            further liability hereunder except as to acts, omissions or defaults
            occurring prior to such termination.

                                      -27-

<PAGE>

Successors
and
Assigns               36. The conditions, covenants and agreements contained in
-------
                  this Lease shall be binding upon and inure to the benefit of
                  the parties hereto and their respective heirs, executors,
                  administrators, successors and assigns. All covenants and
                  agreements of this Lease shall run with the Land.

Memorandum
of Lease              37. The parties hereto have simultaneously with the
--------
                  execution and delivery of this Lease executed and delivered a
                  Memorandum of Lease which Landlord shall, at its sole expense,
                  cause to be recorded within sixty (60) days following delivery
                  of this Lease and returned to Tenant by Landlord after return
                  from the County Clerk's Office where recorded. Such Memorandum
                  of Lease shall be in form and content identical to the form of
                  Memorandum of Lease attached hereto as Exhibit "E" and
                  incorporated herein by reference for all purposes. Upon the
                  expiration or termination of this Lease and tenant's removal
                  from the demised premises, whether by expiration of the Lease
                  Term, event of default, or otherwise, at the written request
                  of Landlord, Tenant shall execute and deliver to Landlord a
                  document in form and content acceptable to Landlord, which
                  shall be in recordable form, and shall evidence the
                  cancellation and termination of this Lease and the Memorandum
                  of Lease. Tenant's obligations to execute and deliver such
                  document of release shall survive the termination of this
                  Lease and may be enforced by Landlord in an action for
                  specific performance of the provisions of this Article 37. In
                  addition, Tenant shall indemnify and save Landlord harmless
                  from and against any and all losses, costs and expenses
                  including, without limitation, reasonable attorney's fees, and
                  other incidental and consequential costs, claims, damages or
                  obligations incurred by Landlord and arising out of Tenant's
                  failure to execute and deliver such documents as are required
                  by this Article 37 within thirty (30) days after being
                  requested to do so by Landlord including, without limitation,
                  any additional interest, expenses, non-refundable fees or
                  commissions, or other costs and expenses associated with any
                  sale, financing or refinancing of any improvements that are
                  delayed or withdrawn because of the failure of Tenant to
                  execute and deliver such documents to Landlord within the time
                  period specified.

No Waiver             38. The failure of either Landlord or Tenant to declare an
---------
                  event of default immediately upon its occurrence, or delay in
                  taking any action in connection with an event of default,
                  shall not constitute a waiver of the default, but said party
                  shall have the right to declare the default at any time and
                  take such action as is lawful or authorized under this Lease.

Estoppel
Certificate           39. Article 39 is Intentionally Deleted.
-----------

No Brokers            40. Landlord and Tenant each represents and warrants to
----------
                  the other that except as provided for in Article 16 of the
                  Agreement of Sale between Landlord and Tenant, dated
                  ____________, 1989 (the "Contract"), provided for the purchase
                  of the demised premises by Landlord from Tenant,

                                      -28-

<PAGE>

               it has not entered into any agreement with, or otherwise had any
               dealings with, any broker or agent in connection with the
               negotiation or execution of this Lease which could form the basis
               of any claim by any such broker or agent for a brokerage fee,
               commission, finder's fee, or any other compensation of any kind
               or nature in connection with the negotiation or execution of this
               Lease, and Landlord and Tenant shall each indemnify and hold
               harmless the other from any costs (including, but not limited to,
               court costs, investigation costs and attorneys' fees), expenses
               or liability for commissions or other compensation claimed by any
               broker or agent with respect to this Lease which arise out of any
               agreement or dealings by such party, or alleged agreement or
               dealings by such party, with any such agent or broker.

Sever-
ability             41.  In case any of the provisions of this Lease shall for
-------        any reason be held to be invalid, illegal or unenforceable, such
               invalidity, illegality or unenforceability shall not affect any
               other provision hereof, and this Lease shall be construed as if
               such invalid, illegal or unenforceable provision had never been
               contained herein.

Entire
Agree-
ment                42.  It is expressly agreed by Landlord and Tenant, as a
----           material consideration for the execution of this Lease, that this
               Lease with the specific references to written extrinsic
               documents, if any, is the entire agreement of the parties; that
               there are, and were, no verbal representations, warranties,
               understandings, stipulations, agreements or promises pertaining
               to this Lease or the expressly mentioned written extrinsic
               documents not incorporated in writing in this Lease or in the
               Contract or in that certain Agreement dated of even date executed
               by Tenant and containing representations and warranties with
               respect to environmental matters (the "Environmental
               Certificate"). Landlord and Tenant expressly agree that they are
               and shall be no implied warranties of merchantability,
               habitability, fitness for a particular purpose or of any other
               kind arising out of this Lease and there are no warranties which
               extend beyond those expressly set forth in this Lease; except as
               otherwise provided in the Contract or the Environmental
               Certificate. It is likewise agreed that this Lease shall be
               governed by the laws of the State of Texas and may not be
               altered, waived, amended or extended except by an instrument in
               writing signed by both Landlord and Tenant.

Attorney's
Fees                43.  In the event either party files suit to enforce the
----           performance of or obtain damages caused by a default under any of
               the terms of this Lease, the party against whom a judgement is
               rendered shall pay the prevailing party's reasonable attorneys'
               fees.

Personal
Liability           44.  In no event shall Landlord be liable to Tenant either
---------      for (a) any loss or damage that may be occasioned by or through
               the acts or omissions of Landlord or of any employee or agent of
               Landlord or of any other persons whomsoever, or (b) any
               consequential damages regardless of causation. With respect to
               tort claims against Landlord, Landlord shall not be liable to
               Tenant or to any other person for any act or omission of Landlord
               or of its

                                      -29-

<PAGE>

                        repairs thereto (provided Landlord shall never be under
                        any obligation to do so) and Tenant shall not be
                        entitled to any abatement or reduction of rent by reason
                        thereof.

                                IN WITNESS WHEREOF, the parties hereto have
                        executed these presents in triplicate and affixed their
                        seals as of the day and year first above written.

                                            LANDLORD:

              WITNESS:                      METROPOLITAN LIFE INSURANCE
                                            COMPANY

              ____________________          By:_________________________________
                                               _________________________________
                                               Its______________________________
              ____________________

                                            TENANT:

              WITNESS:                      K MART CORPORATION

              ____________________          By:_________________________________
                                               _________________________________
                                               Its: M. L. SKILES. VICE PRESIDENT
              ____________________             ---------------------------------

                                      -31-

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