Document:

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                                                                  Exhibit 10.1

                               EXTENSION AGREEMENT

                           DATED AS OF OCTOBER 2, 2000

          THIS EXTENSION AGREEMENT (the "Agreement") is made as of October 2,
2000 by and among Fed Ex Corporation, a Delaware corporation (the "Borrower"),
the Lenders and Bank One, NA, having its principal office in Chicago, Illinois
and formerly known as The First National Bank of Chicago, in its capacity as
agent ("Agent"). Defined terms used herein and not otherwise defined herein
shall have the meanings given to them in that certain Credit Agreement dated as
of January 15, 1998, as amended, by and among the Borrower, the Lenders, Banc
One Capital Markets, Inc., formerly known as First Chicago Capital Markets,
Inc., as Arranger, J.P. Morgan Securities Inc., as Co-Arranger and Syndication
Agent, Chase Securities Inc., as Co-Arranger and Documentation Agent, and the
Agent (as amended, the "Credit Agreement").

                                   WITNESSETH

          WHEREAS, the Borrower, the Lenders and the Agent are parties to the
Credit Agreement;

          WHEREAS, the Borrower, the Lenders and the Agent have agreed to extend
the Tranche B Facility Termination Date on the terms and conditions set forth
herein;

          NOW, THEREFORE, in consideration of the premises set forth above, the
terms and conditions contained herein, and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
Borrower, the Lenders and the Agent agree as follows:

          1.   EXTENSION OF TRANCHE B FACILITY TERMINATION DATE. Notwithstanding
any of the notice requirements of Section 2.19 of the Credit Agreement but
otherwise subject to such Section 2.19, each of the Lenders consents to the
extension of the Tranche B Facility Termination Date to September 30, 2001, and
waives its right under such Section 2.19 to revoke such consent.

          2.   CONDITIONS OF EFFECTIVENESS. This Agreement shall become
effective as of the date set forth above when the Agent shall have received:

               (i)   a counterpart of this Agreement executed by the Borrower,
          the Agent and each Lender;

               (ii)  a counterpart of the Acknowledgment attached hereto as
          EXHIBIT A executed by Guarantor; and

               (iii) such documents evidencing corporate existence, action
          and authority of the Borrower and the Guarantors as the Agent may
          reasonably request.

<PAGE>

          3.   REPRESENTATIONS AND WARRANTIES OF THE BORROWER. The Borrower
represents and warrants that:

               (a)  This Agreement, and the Credit Agreement as previously
          executed and amended and as amended hereby, constitute legal, valid
          and binding obligations of the Borrower and are enforceable against
          the Borrower in accordance with their terms, except as enforceability
          may be limited by bankruptcy, insolvency or similar laws affecting the
          enforcement of creditors' rights generally and subject also to the
          availability of equitable remedies if equitable remedies are sought.

               (b)  Upon the effectiveness of this Agreement, the Borrower
         reaffirms all covenants, representations and warranties made in the
         Credit Agreement.

               (c)  No Default or Unmatured Default has occurred and is
          continuing.

          4.   EFFECT ON CREDIT AGREEMENT.

               (a)  Each reference in the Credit Agreement to "this Agreement,"
          "hereunder," "hereof," "herein" or words of like import shall mean and
          be a reference to the Credit Agreement as amended hereby.

               (b)  Except as specifically amended above, the Credit Agreement
          and all other Loan Documents, instruments and agreements executed
          and/or delivered in connection therewith, shall remain in full force
          and effect, and are hereby ratified and confirmed.

               (c)  The execution, delivery and effectiveness of this
          Agreement shall not, except as expressly provided herein, operate as a
          waiver of any right, power or remedy of the Agent or the Lenders, nor
          constitute a waiver of any provision of the Credit Agreement or any
          other Loan Documents, instruments and agreements executed and/or
          delivered in connection therewith.

          5.   GOVERNING LAW. This Agreement shall be governed by and construed
in accordance with the laws of the State of Illinois.

          6.   HEADINGS. Section headings in this Agreement are included herein
for convenience of reference only and shall not constitute a part of this
Agreement for any other purpose.

          7.   COUNTERPARTS. This Agreement may be executed by one or more of
the parties to the Agreement on any number of separate counterparts and all of
said counterparts taken together shall be deemed to constitute one and the same
instrument.

                                       2

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          IN WITNESS WHEREOF, the Borrower, the Lenders and the Agent have
executed this Agreement as of the date first above written.

                                     FEDEX CORPORATION

                                     By: /s/ Burnetta B. Williams
                                     Name: Burnetta B. Williams
                                     Title: Staff Vice President &
                                            Asst. Treasurer

                                       3

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                                     BANK ONE, NA, having its principal office
                                     in Chicago, Illinois, as Agent

                                     By: /s/ Kenneth J. Kramer
                                     Name: Kenneth J. Kramer
                                     Title: Managing Director

                                       4

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                                     MORGAN GUARANTY TRUST
                                      COMPANY OF NEW YORK

                                     By: /s/ Dennis Wilczek
                                     Name: Dennis Wilczek
                                     Title: Associate

                                       5

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                                     THE CHASE MANHATTAN BANK

                                     By: /s/ Matthew H. Massie
                                     Name: Matthew H. Massie
                                     Title: Managing Director

                                       6

<PAGE>

                                     KBC BANK N.Z., GRAND CAYMAN
                                       BRANCH

                                     By: /s/ Robert Snauffer
                                     Name: Robert Snauffer
                                     Title: First Vice President

                                     By: /s/ Patrick A. Janssens
                                     Name: Patrick A. Janssens
                                     Title: Vice President

                                       7

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                                     BANK OF AMERICA, N.A.,

                                     By: /s/ Sharon Burks Horos
                                     Name: Sharon Burks Horos
                                     Title: Vice President

                                       8

<PAGE>

                                     BANK OF TOKYO-MITSUBISHI
                                       TRUST COMPANY

                                     By:    /s/ Jeff Staebler
                                          -------------------------------
                                     Name:   Jeff Staebler
                                     Title:  Vice President

                                       9

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                                     CITICORP USA, INC.

                                     By: /s/ Michael Boster
                                     Name: Michael Boster
                                     Title: Vice President
                                            Global Aviation

                                       10

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                                     COMMERZBANK AKTIENGESELLSCHAFT,
                                     NEW YORK AND GRAND CAYMAN BRANCHES

                                     By: /s/ Harry Yergey
                                     Name: Harry Yergey
                                     Title: SVP and Manager

                                     By: /s/ Subash Viswanathan
                                     Name: Subash Viswanathan
                                     Title: Vice President

                                       11

<PAGE>

                                     THE FUJI BANK, LIMITED

                                     By: /s/ Raymond Ventura
                                     Name: Raymond Ventura
                                     Title: Vice President and Manager

                                       12

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                                     MELLON BANK, N.A.

                                     By: /s/ Mark F. Johnston
                                     Name: Mark F. Johnston
                                     Title: Vice President

                                       13

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                                     KEYBANK NATIONAL ASSOCIATION

                                     By: /s/ Mark A. LoSchiavo
                                     Name: Mark A. LoSchiavo
                                     Title: Assistant Vice President

                                       14

<PAGE>

                                     AMSOUTH BANCORPORATION, successor-by-
                                     merger to FIRST AMERICAN NATIONAL BANK

                                     By: /s/ S. Floyd Harvey III
                                     Name: S. Floyd Harvey III
                                     Title: Vice President

                                       15

<PAGE>

                                     THE BANK OF NEW YORK

                                     By: /s/ Steven Cavallizzo
                                     Name: Steven Cavallizzo
                                     Title: Vice President

                                       16

<PAGE>

                                     THE BANK OF NOVA SCOTIA

                                     By: /s/ F.C.H. Ashby
                                     Name: F.C.H. Ashby
                                     Title: Senior Manager Loan Operator

                                       17

<PAGE>

                                     CREDIT SUISSE FIRST BOSTON

                                     By: /s/ Robert Hetu
                                     Name: Robert Hetu
                                     Title: Vice President

                                     By: /s/ James P. Moran
                                     Name: James P. Moran
                                     Title: Director

                                       18

<PAGE>

                                     DEUTSCHE VERKEHRS BANK AG

                                     By: /s/ James M. Morton
                                     Name: James M. Morton
                                     Title: Assistant Vice President

                                     By: /s/ Constance Laudenschlager
                                     Name: Constance Laudenschlager
                                     Title: Senior Vice President

                                       19

<PAGE>

                                     THE SANWA BANK, LIMITED

                                     By: /s/ P. Bartlett Wu
                                     Name: P. Bartlett Wu
                                     Title: Vice President

                                       20

<PAGE>

                                     SUNTRUST BANK, NASHVILLE, N.A.

                                     By: /s/ Renee D. Drake
                                     Name: Renee D. Drake
                                     Title: Vice President

                                       21

<PAGE>

                                     THE SUMITOMO BANK, LIMITED

                                     By: /s/ C. Michael Garrido
                                     Name: C. Michael Garrido
                                     Title: Senior Vice President

                                       22

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                                     BANCA COMMERCIALE ITALIANA
                                     NEW YORK BRANCH

                                     By: /s/ J. Dickerhof
                                     Name: J. Dickerhof
                                     Title: VP

                                     By: /s/ E. Bermant
                                     Name: E. Bermant
                                     Title: FVP/Deputy Manager

                                       23

<PAGE>

                                     THE NORTHERN TRUST COMPANY

                                     By: /s/ Ashish S. Bhagwat
                                     Name: Ashish S. Bhagwat
                                     Title: Second Vice President

                                       24

<PAGE>

                                     WACHOVIA BANK, N.A.

                                     By: /s/ Karin E. Reel
                                     Name: Karin E. Reel
                                     Title: Vice President

                                       25

<PAGE>

                                     FIRST UNION NATIONAL BANK

                                     By: /s/ Andrew Tompkins
                                     Name: Andrew Tompkins
                                     Title: VP

                                       26

<PAGE>

                                    EXHIBIT A

                                       TO

                               EXTENSION AGREEMENT

                           DATED AS OF OCTOBER 2, 2000

                                       FOR

                                CREDIT AGREEMENT

                          DATED AS OF JANUARY 15, 1998

                                 ACKNOWLEDGMENT

          Each of the undersigned hereby (i) acknowledges receipt of a copy of
the Extension Agreement dated as of October 2, 2000, relating to the Credit
Agreement dated as of January 15, 1998 by and among the Borrower, the Lenders,
Banc One Capital Markets, Inc., formerly known as First Chicago Capital Markets,
Inc., as Arranger, J.P. Morgan Securities Inc., as Co-Arranger and Syndication
Agent, Chase Securities Inc., as Co-Arranger and Documentation Agent, and the
Agent, as amended (as amended, the "Credit Agreement"), (ii) reaffirms the terms
and conditions of that certain Guaranty dated as of January 27, 1998 (the
"Guaranty") and (iii) acknowledges and agrees that the Guaranty (A) remains in
full force and effect and (B) is hereby ratified and confirmed.

                                     FEDERAL EXPRESS CORPORATION

                                     By: /s/ Tracy G. Schmidt
                                     Name: Tracy G. Schmidt
                                     Title: Sr. Vice President & CFO

                                     FEDEX GROUND PACKAGE SYSTEM, INC.

                                     By: /s/ Daniel J. Sullivan
                                     Name: Daniel J. Sullivan
                                     Title: President & CEO

                                       27

<PAGE>

                                     VIKING FREIGHT, INC.

                                     By: /s/ Douglas G. Duncan
                                     Name: Douglas G. Duncan
                                     Title: President & CEO

                                     FEDEX CUSTOM CRITICAL, INC.

                                     By: /s/ R. Bruce Simpson
                                     Name: R. Bruce Simpson
                                     Title: President

Dated as of October 2, 2000

                                       28<PAGE>

===============================================================================
                                   SUBLEASE

THIS SUBLEASE, IS MADE AND ENTERED INTO THIS 1ST. DAY OF JUNE, 2000, BETWEEN
TWENTY-FIVE-FORTY, LLC (2540 LLC), HEREINAFTER CALLED "SUBLESSOR" AND MOBILE
P.E.T. SYSTEMS, INC. (PET), HEREINAFTER CALLED "SUBLESSEE,"

     WITNESSETH:

     SUBLESSOR, for the consideration hereinafter set forth hereby leases to
SUBLESSEE for the term and upon the conditions hereinafter set forth, the
premises consisting of the office and improvements described more
particularly as "SUITE P" Plus three (3) parking spaces, including the
exclusive use of the adjacent restroom.

     TO HAVE AND TO HOLD said leased premises for the term of the Sublease
and upon the conditions as follows:

     1. TERM:
The term of the Sublease shall be for a period of FIVE (5) YEARS. The
Sublease period shall commence on June 1, 2000, and expire at midnight on May
31, 2004, unless sooner terminated as herein provided.

     2. RENT:
SUBLESSEE agrees to pay to SUBLESSOR rent in accordance with the following
schedule and procedure:
     (a.) The First Year through the Fifth years as follows:

          1st. year: June 1, 2000 thru May 31, 2001, the rental shall be
$3090.00 per month;
          2nd. year: June 1, 2001 thru May 31, 2002, the rental shall be
$3335.00 per month;
          3rd. year: June 1, 2002 thru May 31, 2003, the rental shall be
$3600.00 per month;
          4th. year: June 1, 2003 thru May 31, 2004, the rental shall be
$3885.00 per month;
          5th. year: June 1, 2004 thru May 31, 2005, the rental shall be
$4195.00 per month;
          A fee is to be paid herewith of $2500.00, no part of which is
refundable, for cleaning and restoring the premises and furnishings.
          The foregoing is based upon the local San Diego COLA rate of 8%
during the 1999 rental year as contained in the San Diego Business Journal.
The above rent amounts will be adjusted each year on the first of June in
order to reflect this area wide inflationary figure; up or down, as the case
may be.

                                                           Page 1.  Initial SA
                                                                           ----
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Rent shall be delivered to SUBLESSOR at 2540 Shelter Island Dr., San Diego,
CA 92106. The designated place of payment may be changed at any time by
SUBLESSOR upon ten (10) days written notice to SUBLESSEE.
In the event SUBLESSEE is delinquent in rendering to SUBLESSOR the rental
due, or in remitting the rent due in accordance with the rent provisions of
the Sublease, then SUBLESSEE shall pay to SUBLESSOR a delinquent fee of
$300.00 each occurnace, and the rent not paid when due shall bear interest at
the rate of ten percent (10%) per annum from the date due until paid.
SUBLESSEE agrees to notify SUBLESSOR in writing whenever it changes it's
on-site manager or operator. This notice shall be sent no later than ten (10)
days after the change. In the event the amount of rent increases that
SUBLESSOR is required to pay the San Diego Unified Port District as LESSOR of
the premises covered by the Sublease, and/or as a result of this Sublease,
the rent that SUBLESSEE pays SUBLESSOR shall automatically increase at the
same time by the same rate of by an equal or proportional amount, as
applicable, based upon the premises occupied by SUBLESSEE.

3. USE:
     The premises shall be used by SUBLESSEE for the purpose of
administrative offices for SUBLESSEE's operations. SUBLESSEE shall not use or
permit the premises, or any part thereof, to be used for any other purposes
or in violation of the SUBLESSOR'S Master Lease with the San Diego Unified
Port District (Lessor) dated October 1, 1995, and incorporated herein by
reference. This Sublease is subject to the terms and conditions of said
Master Lease.
     SUBLESSEE shall commit no act of waste and shall take good care of the
premises and the fixtures and appurtenances therein, and, shall, in the use
and occupancy of the premises, conform to all applicable laws, orders and
regulations of the Federal, State and San Diego Municipal Governments, and of
the San Diego Unified Port District. In addition, SUBLESSOR grants to
SUBLESSEE, a license to the exclusive use of three (3) parking spaces.

     4. CONSTRUCTION OF IMPROVEMENTS:
          No construction of any improvements upon the leased premises shall
commence without the prior approval of the SUBLESSOR and the Port Director,
evidenced in writing, and all such construction shall be in accordance with
plans and specifications which must be submitted to SUBLESSOR and Port
Director in writing prior to commencement of any such construction. All such
improvements shall be at SUBLESSEE's sole cost and expense.

                                                           Page 2.  Initial SA
                                                                           ----
<PAGE>

SUBLESSEE further agree that no banners, pennants, flags, advertising
devices, nor any temporary signs shall be permitted to be flown, installed,
placed, or erected on the premises without written consent of the SUBLESSOR
and the Port Director. SUBLESSOR will assist SUBLESSEE in obtaining approval
for normal and customary signage at both street and waterside locations.

     5. TITLE TO IMPROVEMENTS:
          All structures, installations and improvements of any kind placed
on the sub-leased premise by SUBLESSEE shall be deemed owned by SUBLESSEE and,
at the option of SUBLESSOR, with written permission of the Port Director, are
to be removed at SUBLESSEE's expense upon termination of this Sublease. If
SUBLESSOR exercises such option SUBLESSEE shall remove such structures,
buildings, installations or improvements within sixty (60) days after the
expiration of the term of this Sublease or sooner termination thereof. If
SUBLESSEE fails to remove such structures, buildings or improvements with the
60 day period, SUBLESSOR shall have the right to have such structures,
buildings, installations or improvements removed at the expense of SUBLESSEE.
If any structures, buildings, installations or improvements owned by
SUBLESSEE are not removed by SUBLESSEE or SUBLESSOR pursuant to this
paragraph upon termination of this Sublease, then title thereto shall vest in
SUBLESSOR without any cost to SUBLESSOR and SUBLESSEE shall not be entitled
to any payment thereon. In such case, SUBLESSOR shall immediately pay any
debts or obligation relating to such improvements if such debts or
obligations are secured by a perfected lien describing such improvements.
Machines, appliances, equipment and trade fixtures of any kind placed on the
subleased premises by SUBLESSEE shall be owned by, and title thereto, shall
be vested in SUBLESSEE and shall be removed by SUBLESSEE within sixty (60)
days after the expiration of the term of this Sublease or sooner termination
thereof; provided, however, SUBLESSEE agrees to repair any and all damage to
the premises occasioned by the removal thereof. If any such machines,
appliances, equipment and trade fixtures are not removed within sixty (60)
days after the termination of this Sublease, the same may be considered
abandoned and shall thereupon become the property of SUBLESSOR without cost
to the SUBLESSOR and without any payment to SUBLESSEE, except that SUBLESSOR
shall have the right to have the same removed at the expense of the SUBLESSEE.

     6. PERMITS:
          SUBLESSEE is responsible for obtaining all necessary business
licenses, environmental permits if required of any other type of operation
permit required by any governmental or regulatory agency for SUBLESSEE's use
of the premises.

     7. LIENS:
          SUBLESSEE agrees that it will at all times hold SUBLESSOR free and
harmless and indemnify it against all claims for labor and/or materials in
connection with improvements, repairs or alterations on the sub-leased
premises and the costs of defending against such claims, including reasonable
attorney's fees.

                                                           Page 3.  Initial SA
                                                                           ----
<PAGE>

       8.  SUBLEASE ENCUMBRANCE
           SUBLESSEE understands and agrees that it may not encumber this
Sublease, it's sub-lease hold estate or the improvements thereon by Deed of
Trust, Mortgage or other Security Instrument without the prior express
written consent of SUBLESSOR in each such instance. SUBLESSEE acknowledges
that any such encumbrance shall be subominate to existing liens of SUBLESSOR.

       9.  ASSIGNMENT-SUBLEASE
           SUBLESSEE shall not assign or transfer the whole or any part of
this Sublease or any interest therein, nor sublease the whole or any part of
the sub-leased premises or any right or privilege appurtenant thereto without
the express written consent of SUBLESSOR. In the event any consent of
SUBLESSOR is given for any sub-lease, assignment or transfer, the Assignee
hereby agrees to, and assumes, each and every obligation under the Sublease.

      10.  DEFAULT
           It is mutually understood and agreed that if any default be made
in the payment of rent herein provided, or, in the performance of the
covenants, conditions, or agreements herein, and such default shall not be
cured within three (3) days after written notice thereof, SUBLESSOR shall
have the right to immediately terminate this Sublease. In the event of such
termination, SUBLESSEE shall have no further rights hereunder.

      11.  UTILITIES
           SUBLESSEE shall pay the pro-rata portions of all utilities, taxes,
possessory, real and personal, in-lieu or otherwise, assessed or imposed, and
a percentage of water, gas and trash costs incurred in the operation of the
premises by SUBLESSOR.

      12.  INSURANCE
           SUBLESSEE shall maintain insurance acceptable to SUBLESSOR in full
force and effect throughout the term of this Sublease. The policies for said
insurance shall, as a minimum, provide the following:
           a. FORMS OF COVERAGE
              (1) "Occurrence" from Commercial General Liability covering the
premises, operations and contractual liability assumed by SUBLESSEE on this
Sublease, in the amount of not less than $1,000,000.00 combined single limit
per occurrence for bodily injury, personal injury and property damage. Either
the general aggregate limit shall apply separately to this location or the
general aggregate limit shall be twice the required occurrence limit.

                                                           PAGE 4. INITIAL SA
                                                                           ---

<PAGE>

in the amount of not less than ninety (90%) of full replacement value of all
improvements placed within the sub-leased premises. The fire and extended
coverage policy's shall be endorsed to state that any insurance proceeds in
excess of $25,000 shall be payable jointly to SUBLESSOR, SUBLESSEE, San Diego
Unified Port District and Peninsula Bank of San Diego, in order that said
proceeds will be reinvested in rebuilding and/or repairing the damaged
portions of the sub-leased premises; provided, however, that within the
period during which there is in existence a deed of trust upon the
sub-leasehold premises given by SUBLESSEE with the prior written consent of
the San Diego Unified Port District, then, and for that period, all Fire and
Extended Coverage policies shall be made payable jointly to the SUBLESSEE,
SUBLESSOR, the San Diego Unified Port District and Peninsula Bank of San
Diego, and any proceeds therefrom shall be held by Peninsula Bank of San Diego
for the following purposes:
           (i) As a trust fund to pay for the reconstruction, repair or
               replacement of the damaged or destroyed improvements in kind and
               scope with progress payments as the work is performed with any
               excess remaining after completion of said work to be retained by
               Peninsula Bank of San Diego and applied to reduction of the debt
               secured by the Deed of Trust and, with any excess remaining after
               full payment of said debt to be paid over to SUBLESSEE; or,

          (ii) in the event that this Sublease is terminated with the consent
               of both the SUBLESSOR and Peninsula Bank of San Diego and said
               improvements are not reconstructed, repaired or replaced, the
               insurance proceeds shall be retained by the Peninsula Bank of
               San Diego to the extent necessary to fully discharge the debt
               secured by the Deed of Trust and said bank shall hold the
               balance thereof without liability while restoring the premises
               to as neat and clean a condition as previously maintained, and
               then, for SUBLESSOR and SUBLESSEE as their interests may appear.

          b.  GENERAL REQUIREMENTS:
          (1) All required insurance shall be in force the first day of the
              term  of the Sublease. The cost of all required insurance shall
              be borne by SUBLESSEE. Certificates in a form acceptable to
              SUBLESSOR and the San Diego Unified Port District evidencing the
              existence of the necessary insurance policies and original
              endorsements effecting coverage required by this clause, shall be
              kept on file with SUBLESSOR during the entire term of this
              Sublease. The certificates and endorsements for each insurance
              policy are to be signed by a person authorized by that insurer to
              bind coverage on it's behalf. The San Diego Unified Port District
              and SUBLESSOR reserve the right to require complete, CERTIFIED
              copies of all required policies at any time.

                                                           PAGE 5. INITIAL SA
                                                                           ---

<PAGE>

          (2) All liability insurance policy's with name, or be endorsed
              to name SUBLESSOR the Port of San Diego and Peninsula Bank of
              San Diego as additional assured's and protect the Port of
              San Diego, Peninsula Bank of San Diego, SUBLESSOR, their
              officers, officials and employees against any legal costs in
              defending claims.
              All insurance policies will be endorsed to state that coverage
              will not be suspended, voided, canceled, reduced in coverage or
              in limits except after 30 days prior written notice by certified
              mail, return receipt requested, has been given SUBLESSOR.
              All insurance policies will be endorsed to state that
              SUBLESSEE's insurance is primary and not excess or contributory
              to any insurance issued in the name of the Port of San Diego,
              Peninsula Bank of San Diego or SUBLESSOR.
              All insurance policies must conform to Best's top ratings.
              If SUBLESSEE fails or refuses to maintain insurance as required
              in this Sublease, or fails to provide proof of insurance,
              SUBLESSOR has the right to declare this Sublease in default
              without further notice to SUBLESSEE and SUBLESSOR shall be
              entitled to exercise all legal remedies.
              The procuring of such required policies of insurance shall not
              be construed to limit SUBLESSEE's liability hereunder, nor to
              fulfill the indemnification provisions and requirements of this
              Sublease. Notwithstanding said policies of insurance, SUBLESSEE
              shall be obligated for the full and total amount of any damage,
              injury or loss caused by negligence or neglect connected with
              this Sublease, or with the use or occupancy of the subleased
              premises.

      13.  ENTRY BY SUBLESSOR/LESSOR:
           SUBLESSEE shall permit SUBLESSOR and/or LESSOR (in accordance with
           the Master Lease) and their agents to enter into and upon the
           premises at all reasonable times, after prior notice, either
           written or oral, appropriate under all circumstances, for the
           purpose of inspecting the same or for any purpose whatsoever
           including anytime in case of an emergency.

      14.  WARRANTIES-GUARANTIES-COVENANTS:
           SUBLESSOR makes no warranty, guarantee, covenant, including but not
           limited to, covenants of title and quiet enjoyment, or any nature
           whatsoever concerning the condition of the premises, including the
           physical condition thereof, or any condition which may affect the
           Sublease premises, and it is agreed that SUBLESSOR will not be
           responsible for any loss, damage or costs which may be incurred by
           SUBLESSEE acknowledges the existence of the fueling dock operations
           and the rigging operations adjacent to the subleased premises.

                                                           PAGE 6. INITIAL SA
                                                                           ---

<PAGE>

15.  DAMAGE TO OR DESTRUCTION OF PREMISES:
     In the event of a partial destruction of the premises during the term of
     this sublease or any extension thereof from any cause, SUBLESSOR shall
     forthwith repair same, provided insurance proceeds are readily available
     and in such amounts as are necessary to effect such repairs, and,
     provided such repairs can be made within ninety (90) days under the laws
     and regulations of State, Federal, County or Municipal agencies; but
     such partial destruction shall in no way annul or void this Sublease,
     except that SUBLESSEE shall be entitled to a proportionate deduction to
     be based upon the extent to which the making of such repairs shall
     interfere with the business carried on by SUBLESSEE in the premises. If
     such repairs cannot be made within ninety (90) days, SUBLESSOR may, at
     it's option, make same within a reasonable time, and this Sublease shall
     continue in full force and effect, the rent to be proportionately abated
     as aforesaid in this paragraph provided. In the event that SUBLESSOR
     does not so elect to make such repairs which cannot be made or completed
     within ninety (90) days, or such repairs cannot be made under existing
     laws and regulations, this Sublease may be terminated at the option of
     either party. In the event that the improvements that comprise the
     premises are destroyed to the extent of not less than 33.3% (percent) of
     the replacement cost thereof, SUBLESSEE may elect to terminate this
     Sublease, whether the premises be injured or not. A total destruction of
     the premises shall terminate this Sublease.

16.  EMINENT DOMAIN:
     If the whole or a substantial part of the premises hereby subleased
     shall be taken by any public authority under the power of eminent
     domain, then the term of this Sublease shall cease as to the part taken
     from the day of possession of that part so taken for any public purpose;
     and, the rent shall be paid up to that day, and from that day SUBLESSEE
     shall have the right either to terminate this Sublease and declare the
     same null and void, or, to continue in the possession of the remainder
     of the same under the terms herein provided, except that the rent shall
     be reduced in proportion to the amount of the premises taken by
     decreasing the rent proportionately. All damages awarded for such a
     taking shall belong to, and, be the property of SUBLESSOR, whether such
     damages shall be awarded as compensation for diminution in value to the
     subleasehold, or to the fee of the premises herein leased; provided,
     however, that SUBLESSOR shall not be entitled to any award made for the
     taking of any installations or improvements on the subleased premises
     belonging to SUBLESSEE.

                                                          Page 7. Initial  SA
                                                                          -----

<PAGE>

17.  SUCCESSORS IN INTEREST:
     Unless otherwise provided in this Sublease, the terms, covenants and
     conditions herein apply to, and bind, the heirs, successors, executors,
     administrators and assigns of all the parties hereto, all of whom shall
     be jointly and severally liable hereunder.

18.  WASTE & QUIET CONDUCT:
     SUBLESSEE shall not commit, or suffer to be committed, any waste upon
     the subleased premises, nor any nuisance, or act, or thing, which may
     disturb the quiet enjoyment of any other tenant of the premises.
     SUBLESSEE acknowledge the premises are a portion of the premise
     described in the Master Lease and as such are used by a multitude of
     business operations, including, but not limited to, offices, marine
     repairs, equipment storage, engine and equipment operation and
     maintenance, docking, loading and other facility uses which can cause
     nuisances and otherwise disturb the quiet enjoyment of SUBLESSEE and
     SUBLESSOR on the premises.

19.  MAINTENANCE & REPAIRS:
     SUBLESSEE shall, at it's sole cost and expense, keep and maintain the
     premises (via customary janitorial and maintenance services) and
     appurtenances in clean, neat and sanitary order, condition and repair,
     ordinary "wear and tear" excluded.

20.  ACCEPTANCE OF PREMISES:
     By signing this Sublease, SUBLESSEE accepts the premises in an "AS IS"
     condition as being in good and sanitary order, condition and repair as
     of SUBLESSEE also agrees that on the last day of the term of this
     Sublease, or any extension thereof, or sooner termination of same, to
     surrender the premises in the same condition as when received;
     reasonable use and wear thereof excepted.

21.  BANKRUPTCY:
     In the event SUBLESSEE becomes insolvent, makes an assignment for the
     benefit of creditors, becomes the subject of a bankruptcy proceeding,
     reorganization, arrangement, insolvency, receivership, liquidation or
     dissolution proceedings, or in the event of any judicial sale of
     SUBLESSEE's interest under this Sublease, SUBLESSOR shall have the right
     to declare this Sublease in default.

                                                          Page 8. Initial  SA
                                                                          -----

<PAGE>

22.  REMEDIES:
     a.  DEFAULT
         The occurrence of any one or more of the following events shall
         constitute a material default of this Sublease by SUBLESSEE:
         (1)  The vacating or abandonment of the premises by SUBLESSEE.
         (2)  The failure by SUBLESSEE to make any payment of rent
              installment or other payment required to be made by SUBLESSEE,
              as and when due, where such failure shall continue for a period
              of three (3) days after written notice thereof from SUBLESSOR to
              SUBLESSEE. In the event that SUBLESSOR serves SUBLESSEE with a
              Notice to Pay Rent or Quit pursuant to the applicable Unlawful
              Detainer Statutes, such notice to Pay Rent or Quit shall also
              constitute the notice required by this sub-paragraph;
         (3)  Except as otherwise provided in this Sublease, the failure by
              SUBLESSEE to observe or perform any of the covenants,
              conditions or provisions of this Sublease to be observed or
              performed by SUBLESSEE, other than described in Paragraph (2)
              above, where such failure shall continue for a period of thirty
              (30) days after written notice thereof from SUBLESSOR to
              SUBLESSEE provided, however, that if the nature of SUBLESSEE
              non-compliance is such that more than thirty (30) days are
              reasonably required for it's cure, then SUBLESSEE shall not be
              deemed to be in default if SUBLESSEE commenced such cure within
              said thirty (30) day period and thereafter diligently
              prosecutes such cure to completion. To the extent permitted by
              law, such thirty (30) day notice shall constitute the sole and
              exclusive notice required to be given to SUBLESSEE under
              applicable Unlawful Detainer Statutes;
         (4)  The making by Sublease of any general arrangement or general
              assignment for the benefit of creditors;
         (5)  SUBLESSEE become a "Debtor" as defined in 11 U.S.C./101 or any
              successor statute thereto unless, in the case of a petition
              filed against SUBLESSEE, the same is dismissed within sixty
              (60) days;
         (6)  The appointment of a trustee or receiver to take possession of
              substantially all of SUBLESSEE assets located at or upon the
              promises, or, of SUBLESSEE interest in the sublease, where
              possession is not restored to SUBLESSEE within thirty (30)
              days;
         (7)  The attachment, execution or other judicial seizure of
              substantially all of SUBLESSEE assets located at the premises
              or of SUBLESSEE'S interest in the Sublease, where such seizure
              is not discharged within thirty (30) days;
         (8)  The discovery by SUBLESSOR that any financial statement given
              to SUBLESSOR by SUBLESSEE, any assignee of SUBLESSEE, any
              Sub-tenant of SUBLESSEE, and Successor in Interest of SUBLESSEE
              or any Guarantor of SUBLESSEE'S obligation hereunder, was
              materially false.

                                                          Page 9. Initial  SA
                                                                          -----

<PAGE>

b.  REMEDIES

    In the event of any such material default by SUBLESSEE, SUBLESSOR may at
    any time hereafter, with or without notice or demand and without limiting
    SUBLESSOR in the exercise of any right or remedy which SUBLESSOR may have
    by reason of such default.

    (1)  Terminate SUBLESSEE right to possession of the premises by any
         lawful means, in which case this Sublease and the term hereof shall
         terminate and SUBLESSEE shall immediately surrender possession of the
         premises to SUBLESSOR.  In such event SUBLESSOR shall be entitled to
         recover from SUBLESSEE all damages incurred by SUBLESSOR by reason of
         SUBLESSEE'S default, including, but not limited to, the cost of
         recovering possession of the premises; expense of relating, including
         necessary renovation and alteration of the premises, reasonable
         attorney's fees; the worth, at the time of award by the court having
         jurisdiction thereof, or the amount by which the unpaid rent for the
         balance of the term (after the time of the award) exceeds the
         amount of such rental loss for the same period that SUBLESSEE prove
         could be reasonably avoided.

    (2)  Maintain SUBLESSEE'S right to possession in which case this Sublease
         shall continue in effect whether or not SUBLESSEE shall have vacated
         or abandoned the premises.  In such event SUBLESSOR shall be entitled
         to enforce all of SUBLESSOR'S rights and remedies under this Sublease,
         including the right to recover the rent as it becomes due whereunder;

    (3)  Pursue any other remedy now or hereafter available to SUBLESSOR
         under the laws or judicial decisions of the State of California.
         Unpaid installments of rent and other monetary obligations of
         SUBLESSEE under the terms of this Sublease shall bear interest from
         the date due at the maximum rate then allowable by law.

c.  LATE CHARGES

    SUBLESSEE hereby acknowledges that, SUBLESSEE'S share of utilities,
    insurance, taxes or other sums due here under that will cause SUBLESSOR to
    incur costs not contemplated in this Sublease, the exact amount of which
    will be extremely difficult to ascertain.  Such costs include, but are not
    limited to, processing and accounting charges, and late charges be imposed
    on SUBLESSOR by the term of the Master Lease.  Accordingly, if any
    installment of rent or any other sum due from SUBLESSEE shall not be
    received by SUBLESSOR or SUBLESSOR'S designee within three (3) days after
    such amount shall be due, then, without any requirement for notice to
    SUBLESSEE, SUBLESSEE shall pay to SUBLESSOR a late charge of three-hundred
    dollars ($300.00).

                                                   Page 10. Initial  SA
                                                                    ----
<PAGE>

    The parties hereto agree that such a late charge represents a fair and
    reasonable estimate of the costs SUBLESSOR will incur by reason of late
    payment by SUBLESSEE.  Acceptance of such late charge by SUBLESSOR shall
    in no event constitute a waiver of SUBLESSEE'S default with respect to
    such overdue amount, nor prevent SUBLESSOR from exercising any of the
    rights and remedies granted here under.

23. PARTIAL INVALIDITY:

    If any term, covenant, condition or provision of this Sublease is held
    by a court of competent jurisdiction to be invalid, void or unenforceable,
    the remainder of the provisions hereof shall remain in full force and
    effect and in no way shall be affected, impaired or invalidated thereby.

24. ATTORNEY'S FEES:

    Should any action be brought to enforce or interpret this Sublease, the
    prevailing party shall be entitled to reasonable attorney's fees and
    costs of suit.

25. NOTICES:

    All notices to be given to SUBLESSEE, shall be given in writing by
    depositing same in the U.S. mail, postage pre-paid, and addressed to
    SUBLESSEE at the premises, whether or not SUBLESSEE has departed from,
    abandoned, or vacated the same.  All notices to be given to SUBLESSOR
    shall be delivered in the same way to:

                         2540 LLC
                         2540 SHELTER ISLAND DR.,
                         SAN DIEGO, CA 92106

26. WAIVER:

    The waiver by SUBLESSOR, of any breach of any term, covenant, or
    condition herein shall not be deemed to be waiver of such term, covenant
    or any subsequent breach of the same or any other term, covenant or
    condition herein contained. The subsequent acceptance of rent here under
    by SUBLESSOR shall not be deemed to be a waiver of any preceding breach
    by SUBLESSEE.
    SUBLESSEE shall attorn to any purchaser at any foreclosure sale, or to
    any grantee or transferee designated in any deed given in lieu of
    foreclosure. SUBLESSEE shall execute the written agreement and any other
    documents required by the lender to accomplish the purpose of this
    paragraph.

                                                        Page 11. Initial  SA
                                                                         ----

<PAGE>

27. TIME:

     Time is of the essence of this Sublease.

     28. INTERRUPTION OF SERVICES OR USE:
         Interruption or curtailment of any service maintained in the
         premises, if caused by strikes, mechanical difficulties, or any caused
         SUBLESSOR'S control whether similar or dissimilar to those enumerated,
         shall not entitle SUBLESSEE to any claim against SUBLESSOR or to any
         abatement in rent, and shall not constitute constructive or partial
         eviction, unless SUBLESSOR fails to take such measures as may be
         reasonable in the circumstances to restore the service without undue
         delay.

     29. RIGHT TO SHOW PREMISES:
         SUBLESSOR may show the Premises to prospective purchasers,
         mortgagees and to prospective tenants during business hours on
         reasonable notice to SUBLESSEE.

     30. ESTOPPEL CERTIFICATE:
         SUBLESSEE will promptly execute any reasonable estoppel certificate
         requested by SUBLESSOR.

     31. RULES AND REGULATIONS:
         SUBLESSEE and its agents and employees shall at all times be
         governed by all reasonable rules and regulations promulgated by
         SUBLESSOR for use of the premises and surrounding areas. Said rules and
         regulations shall be deemed to be a part hereof and incorporated
         herein. Said rules and regulations may be amended, changed or altered
         from time to time, or new rules and regulations may be promulgated.
         Said rules and regulations shall be personally delivered to SUBLESSEE
         or mailed to SUBLESSEE at SUBLESSEE'S premises by first class mail.
         SUBLESSEE'S continued rental of the Premises shall indicate an
         agreement to be bound by said rules and regulations.

     32. MASTER LEASE SHALL PREVAIL:
         This Sublease shall be, and remain, subject and subordinate to the
         terms, covenants, and conditions of the Master Lease, and
         furthermore, in the event of any conflict or inconsistency between
         the Sublease and the Master Lease, the provisions of the Master Lease
         shall govern and prevail.

     33. COUNTERPARTS:
         This Sublease may be executed in counterparts.

                                       Page 12. Initial SA
                                                       -----

<PAGE>

     34. ACCEPTANCE OF PREMISES:
         By signing this Sublease, SUBLESSES represents and warrants that it
         has independently inspected the premises and made all tests,
         investigations and observations necessary to satisfy itself of the
         condition of the premises. SUBLESSEE agrees it is relying solely on
         such independent inspection, tasks, investigations and observations in
         making this Sublease. SUBLESSEE further acknowledges that the premises
         are in the condition called for by this Sublease; that SUBLESSOR has
         performed all work with respect to premises and that SUBLESSEE does
         not hold SUBLESSOR responsible for any defects in the premises.
         SUBLESSEE further accepts and shall be responsible for any risk of
         harm to any person and property, including without limitations,
         employees of SUBLESSEE, from any latent defects in the premises.

     35. GENDER/SINGULAR/PLURAL
         The neuter gender includes the feminine and masculine; the masculine,
         includes the feminine and neuter, and the feminine includes the
         masculine and neuter and each includes corporation, limited liability
         company, partnership, or other legal entity when the context so
         requires. The singular number includes the plural whenever the context
         so requires.

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

     SUBLESSOR: 2540 LLC     BY:
                                -------------------------

                             NAME:  Michael Selter
                                  -------------------------

                             TITLE: Director
                                  -------------------------

                             DATE:
                                  -------------------------

     SUBLESSEE: MOBILE P.E.T. SYSTEMS, INC.

                               BY:/s/Susan Arrowsmith
                                -------------------------

                             NAME: Susan Arrowsmith
                                  -------------------------

                            TITLE: Office Manager
                                  -------------------------

                             DATE: 5-18-00
                                  -------------------------

                                       Page 13. Initial SA
                                                       -----

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