Document:

<PAGE>

                                                                   EXHIBIT 10.24

                        LIONS GATE ENTERTAINMENT CORP.

                       SUBSCRIPTION AGREEMENT FOR UNITS

     A completed and originally executed copy of this Subscription must be
        delivered to Yorkton Securities Inc. at the following address:

                          BCE Place, 181 Bay Street
                                  Suite 3100
                               Toronto, Ontario
                                    MSJ 2T3

                            Attention: Nelson Smith
                           Telephone: (416) 864-3585
                              Fax: (416) 864-9509

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    LIONS GATE ENTERTAINMENT CORP. Issue: Units issued at US$2,550 per Unit.

    Number of Units: 648
                     -----------------------------------------------------------
    [NOTE: NUMBER OF UNITS AVAILABLE FOR SUBSCRIPTION IS LIMITED BY SECTION
    2(B)]

    Total Subscription Price: US$ 1,652,400
                              --------------------------------------------------
    Name and Residential Address of Subscriber:

    Name: Future Media Productions, Inc.    Residential 25136 Anza Drive
          ------------------------------                ------------------------
    Account No.:                            Address: Valencia, Ca. 91355
                 -----------------------             ---------------------------

    Alternate Registration Instructions: If other than in the name of the
    Subscriber:

    Name:                                   Residential
          ------------------------------                ------------------------
    Account No:                             Address:
                ------------------------             ---------------------------

    Delivery Instructions: The name and address (including contact name and
    telephone number) of the person to whom the certificate representing the
    Shares is to be delivered, other than the Subscriber:

    Name: Louis Weiss                       Address: 25136 Anza Drive
          ------------------------------             ---------------------------
    Contract Name:                                   Valencia, Ca. 91355
                   ---------------------             ---------------------------
    Telephone No.: 661-294-5575
                   ---------------------             ---------------------------
    Account No.
                ------------------------             ---------------------------
<PAGE>

                                      -2-

                       SUBSCRIPTION AGREEMENT FOR UNITS

THIS AGREEMENT is dated for reference the 21st day of December, 1999.
                                          ----
AMONG:
                   LIONS GATE ENTERTAINMENT CORP., a company having
                   an address at Suite 3123, Three Bentall Centre,
                   595 Burrard Street, Vancouver,  B.C., V7X 1J1

                   (the "Issuer")

AND:
                   YORKTON SECURITIES INC., a company having an
                   address at Suite 3100, BCE Place, 181 Bay Street,
                   Toronto, Ontario, M5J 2T3

                   (the "Agent")

AND:
                   THE SUBSCRIBER WHOSE NAME AND ADDRESS APPEARS ON THE
                   EXECUTION PAGE OF THIS AGREEMENT

                   (the "Subscriber")

WHEREAS:

A. Each Unit of the Issuer ("Unit") consists of one 5.25% convertible
redeemable preferred share, Series A ("Preferred Share") and 425 common share
purchase warrants ("Warrants");

B. The Issuer is offering for issue and sale and the Agent is offering for sale,
on a best efforts basis, the Units at a per Unit price of US$2,550 in accordance
with the terms of this Agreement and an agency agreement dated December 20, 1999
between the Issuer and the Agent (the "Agency Agreement");

C. The Subscriber wishes to purchase Units of the Issuer in accordance with the
terms of this Agreement; and

D. In order to prevent a change of control of the Issuer and in order for the
Issuer to remain "Canadian-controlled" pursuant to the Investment Canada Act,
this Agreement contains certain restrictions on the Subscriber, including in
respect of the number of Units which may be purchased and in respect of the
acquisition of additional securities of the Issuer.
<PAGE>

                                      -3-

     IN CONSIDERATION OF THE MUTUAL PROMISES CONTAINED IN THIS AGREEMENT, THE
PARTIES AGREE AS FOLLOWS:

1.   Definitions
     -----------

     In this Agreement:

     (a)  "Agency Agreement" means the agency agreement dated December 20, 1999
          between the Issuer and the Agent;

     (b)  "Agent" means Yorkton Securities Inc.;

     (c)  "Agreement" means this subscription agreement between the Issuer and
          the Subscriber;

     (d)  "Applicable Securities Laws" includes, without limitation,
          collectively, all applicable securities, corporate and other laws,
          rules, regulations, notices and policies;

     (e)  "Canadian Selling Jurisdictions" means the provinces of Ontario,
          Manitoba, Alberta and British Columbia;

     (f)  "Closing" means the making of the deliveries contemplated in Section 7
          of this Agreement in order to complete the purchase and sale of the
          Units contemplated hereby;

     (g)  "Closing Date" means the date or dates of the Closing, as provided for
          in Section 6 of this Agreement;

     (h)  "Common Shares" means the common shares in the capital of the Issuer;

     (i)  "Documents" means, collectively:

          (i)   the Annual Information Form on Form 20-F of the Issuer dated
                August 16, 1999 for the year ended March 31, 1999 and the
                management's discussion and analysis of financial condition and
                results of operations for the year ended March 31, 1999
                incorporated by reference therein;

          (ii)  the comparative audited financial statements of the Issuer as at
                and for the years ended March 31, 1999 and 1998, together with
                the notes thereto and the auditors' report thereon;

          (iii) the report to shareholders containing the unaudited interim
                comparative consolidated financial statements for the three
                month periods ended June 30, 1999 and 1998, and the three and
                six month periods ended September 30, 1999 and 1998; and
<PAGE>

                                      -4-

          (iv)  the Management Information Circular of the Issuer dated August
                12, 1999 prepared in connection with the Issuer's annual meeting
                of shareholders held on September 22, 1999;

     (j)  "Exchanges" means collectively, The Toronto Stock Exchange and the
          American Stock Exchange;

     (k)  "Execution Page" means the page or pages at the end of this Agreement
          for execution by the parties hereto and marked "Execution Page";

     (1)  "Final Closing Date" means January 15, 2000 or such earlier date as
          may be agreed to in writing by the Agent and the Issuer;

     (m)  "Financial Statements" means the audited financial statements of the
          Issuer for the year ended March 31, 1999 and the unaudited financial
          statements for the three months ended June 30, 1999 and the three and
          six months ended September 30, 1999;

     (n)  "Issuer" means Lions Gate Entertainment Corp.;

     (o)  "Misrepresentation", "material change" and "material fact" shall have
          the meanings ascribed thereto under the Applicable Securities Laws of
          the Selling Jurisdictions; "distribution" means "distribution" or
          "distribution to the public", as the case may be, as defined under the
          Applicable Securities Laws of the Selling Jurisdiction; and
          "distribute" has a corresponding meaning;

     (p)  "Offering" means the offering by the Issuer and the Agent, on a best
          efforts basis, of up to 13,000 Units;

     (q)  "Preferred Shares" means the 5.25% convertible redeemable preferred
          shares, Series A in the capital of the Issuer;

     (r)  "Preliminary Prospectus" means the preliminary short form prospectus
          of the Issuer dated December 6, 1999 in respect of the distribution of
          the Preferred Shares and Warrants comprising the Units, including
          (except where otherwise provided) all documents incorporated by
          reference therein, and any amendments thereto;

     (s)  "Prospectus" means the final short form prospectus of the Issuer dated
          December 20, 1999 in respect of the distribution of the Preferred
          Shares and Warrants comprising the Units, including (except where
          otherwise provided) all documents incorporated by reference therein,
          and any amendments thereto;

     (t)  "Public Record" means all information filed by or on behalf of the
          Issuer after March 31, 1999 and on or before the cessation of
          distribution of the Units with the Securities Commissions, including
          without limitation, the Documents, the Preliminary Prospectus and the
          Prospectus and any other information filed with
<PAGE>

                                      -5-

          any Securities Commission in compliance, or intended compliance, with
          any Applicable Securities Laws;

     (u)  "Reference Date" means the reference date of this Agreement being the
          date first written above;

     (v)  "Regulation D" means Regulation D under the U.S. Securities Act;

     (w)  "Regulation S" means Regulation S under the U.S. Securities Act;

     (x)  "Securities Commissions" means the securities commissions or similar
          regulatory authorities in the Canadian Selling Jurisdictions;

     (y)  "Selling Jurisdictions" means the Canadian Selling Jurisdictions, the
          United States and such other jurisdictions as may be agreed to by the
          Issuer and the Agent;

     (z)  "Subscription Price" means the price to be paid by the Subscriber to
          purchase the Units under the Offering, being US$2,550 per Unit;

     (aa) "Trust Company" means CIBC Mellon Trust Company in its capacity
          as registrar and transfer agent for the Preferred Shares and
          Common Shares and as trustee for the Warrants;

     (bb) "United States" means the United States as that term is defined
          in Regulation S under the U.S. Securities Act;

     (cc) "Units" means the units of the Issuer, where each Unit consists
          of one Preferred Share and 425 Warrants;

     (dd) "U.S. Person" means a "U.S. Person", as that term is defined
          in Regulation S under the U.S. Securities Act;

     (ee) "U.S. Securities Act" means the Securities Act of 1933, as
          amended, of the United States;

     (ff) "Warrant Indenture" means the warrant indenture to be dated as
          of the Closing Date between the Issuer and the Trust Company, as
          trustee, governing the terms and conditions of the Warrants; and

     (gg) "Warrants" means the common share purchase warrants of the
          Issuer, where each whole Warrant entitles the holder to purchase
          one Common Share at a price of US$5.00 prior to January 1, 2004.

2.   Subscription for Units
     ----------------------

     (a)  On the terms and subject to the conditions set out in this Agreement,
          the Subscriber hereby subscribes for, and the Issuer agrees to issue
          and sell as herein provided, that number of Units set forth on the
          Execution Page, at and for the
<PAGE>

                                      -6-

          Subscription Price of US$2,550 per Unit, for that total Subscription
          Price set forth on the Execution Page.

     (b)  The Issuer will not accept subscriptions for more than 4,350 Units
          from: (i) any Subscriber acting alone; (ii) all Subscribers forming a
          "voting group" (as defined in the Investment Canada Act); or (iii) all
          Subscribers "acting jointly or in concert" (as defined in the
          Securities Act (British Columbia)).

     (c)  No fractional Units may be purchased by a Subscriber.

     (d)  At the Closing, Subscribers will be entitled to receive certificates
          representing the Preferred Shares and Warrants constituting the Units
          purchased, as provided for in Section 7 of this Agreement.

3.   Certification and Covenants of the Subscriber
     ---------------------------------------------

     The Subscriber certifies and covenants with the Issuer and the Agent that
     as of the Reference Date and the Closing Date (and in respect of Sections
     3(b), 3(c), 3(d) and 3(e), for the period referred to below):

     (a)  Jurisdiction of Control: the Subscriber, or the beneficial purchaser
          -----------------------
          for whom it is purchasing, is:

          (i)  [_] "Canadian-controlled" as determined pursuant to subsection
                   26(1) or 26(2) of the Investment Canada Act and in respect of
                   which no determination or declaration has been made under
                   subsection 26(2.1) of that Act (see attached Appendix "A"),
                   or

          (ii) [X] Other: Delaware, USA
                                        ----------------------------------------
                                            (state jurisdiction of control)

     (b)  Restrictions on Acquisitions: the Subscriber hereby covenants that the
          ----------------------------
          Subscriber will not, acting alone, acting as part of a "voting group"
          (as defined in the Investment Canada Act) or "acting jointly or in
          concert" (as defined in the Securities Act (British Columbia)) with
          another person(s):

          (i)  acquire an interest in Units which would cause the undersigned,
               such voting group or such group acting jointly or in concert, to
               acquire beneficial ownership of, or to exercise control or
               direction over, more than 4,350 Units; or

          (ii) acquire an interest in additional securities of the Issuer which
               would cause the undersigned, such voting group or such group
               acting jointly or in concert, to acquire beneficial ownership of,
               or to exercise control or direction over, more than 12.5% of the
               outstanding Common Shares (on a fully diluted basis);
<PAGE>

                                      -7-

               in each case, without the prior written consent of a majority of
               the directors of the Issuer.

          (c)  Restriction on Groups: the Subscriber hereby covenants that the
               ---------------------
               Subscriber will not act as part of a "voting group" (as
               defined in the Investment Canada Act) or act "jointly or in
               concert" (as defined in the Securities Act (British Columbia))
               with another person(s), in any matter relating, directly or
               indirectly, to the Issuer;

          (d)  Restrictions on Soliciting Proxies: the Subscriber hereby
               ----------------------------------
               covenants that, during the period in which the Subscriber has
               beneficial ownership of, or exercises control or direction over,
               any Preferred Shares or more than 10% of the outstanding Common
               Shares (on a fully diluted basis), the Subscriber will not
               solicit proxies from any holders of securities of the Issuer, and
               will not participate in any solicitation of proxies (other than a
               solicitation by management), if such solicitation relates to the
               election of directors of the Issuer, provided that (i) the Issuer
               is not in default of its covenants contained in Sections
               5(z) and/or 5(aa) and/or 5(dd) and (ii) that number of nominees
               of the holders of the Series A Preferred Shares equal to the
               number of directors which the holders of Series A Preferred
               Shares are or would have been entitled to elect, exclusively and
               separately as a class, pursuant to the provisions of the
               amendment to the articles and memorandum of the Issuer
               contemplated by Section 5(z), have been elected as directors of
               the Issuer; and

          (e)  Restrictions on Transfer: the Subscriber hereby agrees that the
               ------------------------
               Subscriber may not sell or otherwise transfer the Units, the
               Preferred Shares or the Warrants, without the prior written
               approval of the Issuer. The Subscriber acknowledges that such
               approval may not be granted if the transferee is not "Canadian-
               controlled" and such approval may only be granted subject to
               certain conditions, including, without limitation, that the
               transferee be bound by the covenants contained in Sections 3(b),
               3(c), 3(d) and 3(e) in respect of such securities to be
               transferred.

          The Subscriber acknowledges and agrees that the foregoing
          certification and covenants set out herein are made by the
          Subscriber with the intent that they be relied upon in determining its
          suitability as a purchaser of Units and the Subscriber hereby agrees
          to indemnify the Issuer and the Agent against all losses, claims,
          costs, expenses arising from any inaccuracy in or breach by the
          Subscriber of the foregoing certification and covenants.

          The Subscriber further acknowledges that damages would be an
          insufficient remedy for a breach by it of the covenants contained in
          Sections 3(b), 3(c), 3(d) and 3(e) and agrees that the Issuer may
          apply for and obtain any relief available to it in a court of law or
          equity, including injunctive relief, to restrain breach or threat of
          breach of the foregoing covenants by the Subscriber or to enforce the
          foregoing covenants, in addition to rights the Issuer may have to
          damages arising from such breach or threat of breach. In addition, the
          Subscriber acknowledges that the Issuer will not register, and will
          direct the Transfer Agent of the Issuer's securities not to register,
          any proposed transfer of such securities which violates the covenants
          in Sections 3(b) and 3(e).
<PAGE>

                                      -8-

     Notwithstanding any other provision herein, the covenants contained in
     Sections 3(b), 3(c), 3(d) and 3(e) shall not operate to prevent the
     Subscriber or any member of a "voting group" (as defined in the
     Investment Canada Act) of which the Subscriber forms a part or any
     person(s) with whom the Subscriber is "acting jointly or in concert" (as
     defined in the Securities Act (British Columbia)) from making a take-over
     bid for the Issuer in response to a competing take-over bid made for the
     Issuer by a person(s) who is not a member of a "voting group" (as defined
     in the Investment Canada Act) of which the Subscriber forms a part or a
     person(s) with whom the Subscriber is "acting jointly or in concert" (as
     defined in the Securities Act (British Columbia)).

     Notwithstanding any other provision herein, the covenants contained in
     Sections 3(b), 3(c), 3(d) and 3(e) shall survive the Closing Date for a
     period ending on the earlier of (i) 3 years from the Closing Date and
     (ii) the date on which the Issuer ceases to be "Canadian-controlled" as
     determined pursuant to subsection 26(l) or 26(2) of the Investment Canada
     Act and in respect of which no determination or declaration has been made
     under subsection 26(2.1) of that Act.

4.   Further Acknowledgements, Warranties, Representations and Covenants of
     ----------------------------------------------------------------------
     the Subscriber
     --------------

     The Subscriber acknowledges, warrants and represents to, and covenants
     with, the Issuer and the Agent that as of the Reference Date and the
     Closing Date:

     (a)  Legal Capacity: the Subscriber has the legal capacity to enter into,
          --------------
          execute and deliver this Agreement and this Agreement has been duly
          authorized, executed and delivered by, and once accepted by the
          Issuer, constitutes a legal, valid and binding agreement of, the
          Subscriber enforceable against the Subscriber in accordance with its
          terms;

     (b)  Age of Majority: if an individual, the Subscriber is of the full age
          ---------------
          of majority and is legally competent to execute this Agreement and
          to take all action pursuant to it;

     (c)  Acceptance By the Issuer: the offer made by the Subscriber in this
          ------------------------
          subscription is irrevocable and the offer requires acceptance by the
          Issuer and the Subscriber acknowledges that the Issuer may, in its
          sole discretion, accept or reject such offer in whole or in part,
          including pursuant to Section 2(b);

     (d)  Legal Advice: the Subscriber acknowledges and agrees that it is
          ------------
          responsible for obtaining such legal advice as it considers
          appropriate in connection with the execution, delivery and performance
          by it of this Agreement and the transactions contemplated hereunder;

     (e)  Investment Suitability: the Subscriber, or any beneficial Subscriber
          ----------------------
          on whose behalf the Subscriber is purchasing the Units, has such
          knowledge and experience in financial and business affairs as to be
          capable of evaluating the merits and risks
<PAGE>

                                      -9-

          of the investment hereunder and is able to bear the economic risk of
          loss of such investment;

     (f)  Compliance with Local Laws: the purchase by the Subscriber of the
          --------------------------
          Units subscribed for hereunder will be made in compliance with all
          requirements of the applicable laws of the jurisdiction(s) in which it
          is resident or to which it is subject and no filings or approvals will
          be required by the Subscriber under the laws of such jurisdiction(s)
          in connection with the purchase by it of the Units hereunder;

     (g)  No Representation: No person has made to the Subscriber any written or
          -----------------
          oral representation:

          (i)  as to the future price or value of the securities offered
               hereunder; or

          (ii) that the Units or the securities which constitute the Units
               (excluding, for greater certainty, the Common Shares issuable
               upon conversion of the Preferred Shares and upon exercise of the
               Warrants) will be listed and posted for trading on a stock
               exchange or that an application has been made to list and post
               such securities for trading on a stock exchange;

     (h)  No Registration: the Subscriber understands that the Units, the
          ---------------
          Preferred Shares, the Warrants and the Common Shares issuable upon
          conversion of the Preferred Shares and upon exercise of the Warrants,
          have not been and will not be registered under the U.S. Securities
          Act, as amended or the securities laws of any state of the United
          States and that the sale contemplated hereby is being made in reliance
          on an exemption from such registration requirements and the Subscriber
          understands and agrees that the Units, the Preferred Shares, the
          Warrants and the Common Shares issuable upon conversion of the
          Preferred Shares and upon exercise of the Warrants, may not be traded
          in the United States or by or on behalf of a U.S. Person or a person
          in the United States unless registered under the U.S. Securities Act
          and any applicable state securities laws or unless an exemption from
          such registration requirements is available and that certificates
          representing the Preferred Shares, the Warrants and the Common Shares
          issuable upon conversion of the Preferred Shares and upon exercise of
          the Warrants, will bear a legend to such effect; and

     (i)  The Subscriber is one of the following (please check appropriate
          lines):

          (i)  _______ Not a "U.S. Person": the Subscriber, whether acting as
                       principal, trustee or agent, is neither a U.S. Person,
                       nor purchasing the Units as a U.S. Person or for resale
                       in the United States and the Subscriber confirms that
                       the Units have not been offered to the Subscriber in the
                       United States and this Agreement has not been signed in
                       the United States; or

          (ii) _______ U.S. Residents: the Subscriber satisfies one or more of
                       the categories indicated below (please check appropriate
                       lines):

<PAGE>

                                      -10-

    _____ Category 1

          Any bank as defined in Section 3(a)(2) of the U.S. Securities Act or
          any savings and loan association or other institution as defined in
          Section 3(a)(5)(A) of the U.S. Securities Act, whether acting in its
          individual or fiduciary capacity; any broker dealer registered
          pursuant to Section 15 of the Securities Exchange Act of 1934; any
          insurance company as defined in Section 2(13) of the U.S. Securities
          Act; any investment company registered under the Investment Company
          Act of 1940 or a business development company as defined in Section
          2(a)(48) thereof; any Small Business Investment Company licensed by
          the U.S. Small Business Administration under Section 301(c) or (d) of
          the Small Business Investment Act of 1958; any plan established and
          maintained by a state, its political subdivisions, or any agency or
          instrumentality of a state or its political subdivisions, for the
          benefit of its employee, if such plan has total assets in excess of
          US$5,000,000; any employee benefit plan within the meaning of the
          Employee Retirement Income Security Act 1974, if the investment
          decision is made by plan fiduciary, as defined in Section 3(21)
          thereof, which is either a bank, savings and loan association,
          insurance company, or registered investment adviser, or if the
          employee benefit has total assets in excess of US$5,000,000, or, if a
          self-directed plan, with the investment decisions made solely by
          persons that are accredited investors;

    _____ Category 2.

          Any private business development company as defined in Section
          202(a)(22) of the Investment Advisors Act of 1940;

    _[X]_ Category 3.

          Any organization described in Section 501(c)(3) of the Internal
          Revenue Code of 1986, corporation, Massachusetts or similar business
          trust, or partnership, not formed for the specific purpose of
          acquiring the Units, with total assets in excess of US$5,000,000;

    _____ Category 4.

          Any director or executive officer of the Issuer;

    _____ Category 5.

          Any natural person whose individual net worth, or joint net worth with
          that person's spouse, at the time of such person's purchase of the
          Units exceeds US$1,000,000;

          Category 6.

          Any natural person who had an individual income in excess of
          US$200,000 in each of the two most recent years or joint income
          with that person's spouse in excess of US$300,000 in each of
<PAGE>

                                      -11-

                    those years and has a reasonable expectation of reaching the
                    same level in the current year;

              _____ Category 7.

                    Any trust with total assets in excess of US$5,000,000, not
                    formed for the specific purpose of acquiring the Units,
                    whose purchase is directed by a sophisticated person as
                    described in Rule 506(b)(2)(ii) of Regulation D under the
                    U.S. Securities Act; or

              _[X]_ Category 8.

                    Any entity in which all of the equity owners are accredited
                    investors.

              and the Subscriber makes the additional representations and
              warranties contained in Schedule "A" attached to this Agreement.

      The Subscriber acknowledges and agrees that the foregoing representations,
      warranties and covenants set out herein are made by the Subscriber with
      the intent that they be relied upon in determining its suitability as a
      purchaser of Units and the Subscriber hereby agrees to indemnify the
      Issuer and the Agent against all losses, claims, costs, expenses arising
      from any inaccuracy in or breach by the Subscriber of the foregoing
      representations, warranties and covenants. The Subscriber further agrees
      that by accepting the Units, the Subscriber shall be representing and
      warranting that the foregoing representations and warranties are true as
      at the Closing Date with the same force and effect as if they had been
      made by the Subscriber at the Closing Date. The Subscriber undertakes to
      notify the Issuer and the Agent immediately at the address of the Issuer
      or the Agent first set forth above of any change in any representation,
      warranty or other information relating to the Subscriber set forth herein
      which takes place prior to the Closing Date.

5.    Warranties, Representations and Covenants of the Issuer
      -------------------------------------------------------

      The Issuer warrants and represents to, and covenants with the Subscriber
      and the Agent that as of the Reference Date and as at the Closing Date:

      (a)  each of the Issuer and its subsidiaries has been duly incorporated
           and organized and is validly existing under the laws of the
           jurisdiction of its incorporation and has all requisite corporate
           authority and power to carry on its business, as now conducted and as
           presently proposed to be conducted by it, and to own, lease, or own
           and lease its property and assets (including licenses or other
           similar rights) and has all the requisite corporate power and
           authority to carry on its business as currently carried on or as
           currently proposed to be carried on;

      (b)  each of the Issuer and its subsidiaries is qualified to carry on
           business under the laws of each jurisdiction in which it carries on a
           material portion of its business and is duly licensed, registered or
           qualified in all jurisdictions in which it owns, leases or operates
           any material portion of its property or carries on any material
           portion of its business to enable its business and assets to be
           owned, leased and
<PAGE>

                                      -12-

          operated, except to the extent that the failure to so comply or to be
          so licensed, registered or qualified would not have a material adverse
          effect on the Issuer and its subsidiaries (taken as a whole) and all
          such licenses, registrations or qualifications which are material are
          valid and existing in good standing in all material respects;

     (c)  except as otherwise disclosed in the Prospectus, each of the Issuer
          and its subsidiaries holds all requisite material licenses,
          registrations, qualifications, permits and consents necessary or
          appropriate for carrying on its business as currently carried on and
          all such licenses, registrations, qualifications, permits and consents
          are valid and subsisting and in good standing in all material respects
          and none of the same contains any burdensome term, provision,
          condition or limitation which has or may have a material adverse
          effect upon the operations of the business of the Company and its
          subsidiaries (taken as a whole) as currently carried on or as
          currently proposed to be carried on;

     (d)  except as otherwise disclosed in the Prospectus, the Issuer owns all
          of the issued and outstanding shares of each of its subsidiaries, in
          each case free and clear of all mortgages, liens, charges, pledges,
          security interests, encumbrances, claims or demands whatsoever (other
          than mortgages, liens, charges, pledges and/or security interests
          granted to its principal banker in the ordinary course), and no
          person, firm or Issuer has any agreement, option, right or privilege
          (whether preemptive or contractual) capable of becoming an agreement,
          for the purchase from the Issuer or any of its subsidiaries of any
          interest in any of the issued or unissued shares in the capital stock
          of any subsidiary other than pursuant to a unanimous shareholders'
          agreement among the Issuer, Fox Family Worldwide Inc. and others dated
          June 23, 1998;

     (e)  except as disclosed in the Prospectus, each of the Issuer and its
          subsidiaries has valid title to all of its material assets including
          all material licenses, free and clear of all charges, hypothecs,
          mortgages, encumbrances or other liens (other than mortgages, liens,
          charges, pledges and/or security interests granted to its principal
          lender and such other subordinated or project-specific lenders and
          other permitted liens as its principal lender permits);

     (f)  the Issuer has full corporate power and authority to enter into this
          Agreement and the Warrant Indenture and to perform its obligations set
          out herein and therein and this Agreement and the Warrant Indenture
          have been, or will be, duly authorized, executed and delivered by the
          Issuer and are or will constitute a legal, valid and binding
          obligation of the Issuer enforceable against the Issuer in accordance
          with their terms, subject to laws relating to creditors' rights
          generally and except as rights to indemnity may be limited by
          applicable law;

     (g)  at the Closing Date, the Preferred Shares and the Warrants will be
          duly and validly authorized, allotted and reserved for issuance and,
          in the case of the Preferred Shares, upon receipt of the purchase
          price therefor, will be issued as fully paid and non-assessable shares
          in the capital of the Issuer, as the case may
<PAGE>

                                      -13-

          be, and the Common Shares issuable upon exercise of the Warrants or
          conversion of the Preferred Shares will have been allotted and
          reserved for issuance;

     (h)  the Issuer is not in default or breach of, and the execution and
          delivery of, and the performance of and compliance with the terms of,
          this Agreement and the Warrant Indenture by the Issuer or any of the
          transactions contemplated hereby or thereby, does not and will not
          result in any breach of, or constitute a default under, and does not
          and will not create a state of facts which, after notice or lapse of
          time or both, would result in a breach of or constitute a default
          under, any term or provision of the charter documents of the Issuer,
          by-laws or resolutions of shareholders or directors of the Issuer, or
          any indenture, mortgage, note, contract, agreement (written or oral),
          instrument, lease or other document to which the Issuer or any of its
          subsidiaries is a party or by which any of them is bound, or any
          judgment, decree or order or, to the best of the knowledge of the
          Issuer, any law, statute, rule or regulation applicable to the Issuer
          or any of its subsidiaries, which default or breach might reasonably
          be expected to materially adversely affect the business, operations,
          capital or condition (financial or otherwise) of the Issuer and its
          subsidiaries (taken as a whole) or its assets (on a consolidated
          basis);

     (i)  other than as has been publicly and generally disclosed, there has not
          been any material adverse change in the business, operations, capital
          or condition (financial or otherwise) or results of the operations of
          the Issuer and its subsidiaries (taken as a whole) since March 31,
          1999; and since March 31, 1999, there have been no material facts,
          transactions, events or occurrences which, to the knowledge of the
          Issuer, could materially adversely affect the capital, assets,
          liabilities (absolute, accrued, contingent or otherwise), business,
          operations or condition (financial or otherwise) or results of the
          operations of the Issuer and its subsidiaries (taken as a whole) which
          have not been disclosed to the public or in writing to the Subscriber;

     (j)  the Financial Statements fairly present, in all material respects and
          in accordance with generally accepted accounting principles in Canada
          consistently applied, the financial position of the Issuer and its
          subsidiaries (on a consolidated basis) as at the dates thereof and the
          results of the operations of the Issuer and its subsidiaries (on a
          consolidated basis) for the periods then ended and reflect all
          liabilities (absolute, accrued, contingent or otherwise) of the Issuer
          and its subsidiaries (on a consolidated basis) as at the dates
          thereof;

     (k)  except as disclosed in the Financial Statements, there are no actions,
          suits, proceedings or inquiries pending or threatened against or
          affecting the Issuer or any of its subsidiaries at law or in equity or
          before or by any federal, provincial, state, municipal or other
          governmental department, commission, board, bureau, agency or
          instrumentality which in any way materially adversely affect, or may
          in any way materially adversely affect, the business, operations,
          capital or condition (financial or otherwise) of the Issuer and its
          subsidiaries (taken as a whole) or its assets (on a consolidated
          basis) or which questions the validity of any action taken
<PAGE>

                                      -14-

          or to be taken by the Issuer pursuant to or in connection with this
          Agreement or as contemplated by the Prospectus, or which affects or
          may affect the distribution of the Preferred Shares and Warrants
          comprising the Units, and the Issuer is not aware of any existing
          ground on which such action, suit, proceeding or inquiry might be
          commenced with any reasonable likelihood of success;

     (l)  the information and statements set forth in the Public Record were
          true, correct and complete and did not contain any misrepresentation,
          as of the date of such information or statement, and the Issuer has
          not filed any confidential material change reports still maintained on
          a confidential basis;

     (m)  the Issuer has an authorized share capital of 500,000,000 Common
          Shares and 200,000,000 preference shares, of which 30,551,167 Common
          Shares and no preference shares were issued and outstanding as at
          December 20, 1999 before giving effect to the Offering, and all of
          such issued and outstanding shares in the capital of the Issuer are
          duly authorized, issued and outstanding as fully paid and non-
          assessable shares in the capital of the Issuer. No person, firm or
          Issuer (except employees, officers and directors of the Issuer and its
          subsidiaries who collectively hold, as at December 13, 1999, options
          to acquire approximately 3,511,123 Common Shares) has any agreement
          or option, or right or privilege (whether pre-emptive or contractual)
          capable of becoming an agreement or option, for the purchase from the
          Issuer of any unissued shares of the Issuer except as otherwise
          described in the Prospectus and except pursuant to a unanimous
          shareholders' agreement among the Issuer, Fox Family Worldwide Inc.
          and others dated June 23, 1998;

     (n)  except as otherwise described in the Prospectus, to the knowledge of
          the Issuer no agreement is in force or effect which in any manner
          affects the voting or control of any of the securities of the Issuer
          or any of its subsidiaries;

     (o)  no approval, authorization, consent or other order of, and no filing,
          registration or recording with, any governmental authority is required
          of the Issuer in connection with the execution and delivery or with
          the performance by the Issuer of this Agreement except compliance
          with the Applicable Securities Laws (including stock exchange
          approvals) with regard to the Offering;

     (p)  the Issuer and its subsidiaries have timely filed all necessary
          material tax returns and notices and have paid or made provision for
          all applicable taxes of whatever nature for all tax years to the date
          hereof to the extent such taxes are material and have become due or
          have been alleged to be due; the Issuer is not aware of any material
          tax deficiencies or material interest or penalties accrued or
          accruing, or alleged to be accrued or accruing, thereon with respect
          to itself or its subsidiaries which have not otherwise been provided
          for by the Issuer;

     (q)  except as otherwise disclosed in the Prospectus, the Issuer is not
          aware of any legislation which it anticipates will materially and
          adversely affect the business, affairs, operations, assets,
          liabilities (contingent or otherwise) or prospects of the Issuer and
          its subsidiaries considered as a whole;
<PAGE>

                                      -15-

     (r)  the Trust Company has been duly appointed transfer agent and registrar
          for the Common Shares of the Issuer and the Preferred Shares at its
          principal offices in the cities of Vancouver and Toronto and has
          been duly appointed as the Trustee for the Warrants and Chase Mellon
          Shareholder Services has been appointed co-transfer agent and co-
          registrar for the Common Shares;

     (s)  no Securities Commission, other securities commission or similar
          regulatory authority, Exchange or other exchange in Canada, Europe,
          the United Kingdom or the United States has issued any order which is
          currently outstanding preventing or suspending trading in any
          securities of the Issuer, no such proceeding is, to the knowledge of
          the Issuer, pending, contemplated or threatened and the Issuer is not
          in default of any material requirement of Applicable Securities Laws
          of the Selling Jurisdictions;

     (t)  the issued and outstanding Common Shares are listed and posted for
          trading on the Exchanges and the Common Shares issuable upon exercise
          of the Warrants and upon conversion of the Preferred Shares are
          conditionally approved for listing on the Exchanges subject to the
          fulfillment of all of the requirements of the Exchanges;

     (u)  the Issuer is in compliance with its timely disclosure obligations
          under Applicable Securities Laws in the Selling Jurisdictions and
          under the rules of the Exchanges;

     (v)  the Issuer is a "reporting issuer" or maintains an equivalent standard
          in each of the Canadian Selling Jurisdictions within the meaning of
          the Applicable Securities Laws in such provinces and is eligible to
          participate in the prompt offering qualification system in each of the
          Canadian Selling Jurisdictions with a "Current AIF" (within the
          meaning of National Policy Statement No. 47) and is not in default of
          any requirement in relation thereto in any material respect;

     (w)  to the knowledge of the Issuer, no officer of the Issuer has a present
          intention to sell any material number of securities of the Issuer;

     (x)  there are no actions, suits, proceedings, investigations or claims,
          pending or threatened against the Issuer or any of its subsidiaries in
          respect of any benefit acquired by the Issuer or any of its
          subsidiaries or any reassessment of any benefit acquired by the Issuer
          or any of its subsidiaries under any Canadian federal or provincial
          incentive program to promote the television and motion picture
          production and distribution industries ("Incentive Program") which
          would, if determined adversely to the Issuer or any of its
          subsidiaries, have a material adverse effect on the business,
          operations, capital or condition (financial or otherwise) of the
          Issuer and its subsidiaries (taken as a whole) or its assets (on a
          consolidated basis); any material representation or warranty made by
          the Issuer and/or its subsidiary in an application for a benefit
          issuable under an Incentive Program was true and accurate at the time
          said representation or warranty was made by the Issuer and/or
          subsidiary;
<PAGE>

                                      -16-

    (y)  on the Closing Date, the Issuer will appoint Jon Feltheimer, Herbert
         Kloiber and Howard A. Knight to the board of directors of the Issuer to
         serve as board members until the next annual meeting of the Issuer;

    (z)  the Issuer will submit to the shareholders of the Issuer a resolution
         to approve an amendment to the articles and memorandum of the Issuer at
         the next special or annual meeting of shareholders of the Issuer to
         provide holders of the Preferred Shares with a right satisfactory to
         the Subscriber, acting reasonably, to appoint three members and
         nominate a fourth member (who must be a resident of Canada) to the
         board of directors of the Issuer for so long as a certain number of
         Preferred Shares remain outstanding;

    (aa) if the amendment to the articles and memorandum of the Issuer provided
         for in Section 5(z) is not approved by the holders of the Common
         Shares, the Issuer will include in any slate of nominees proposed for
         election by the holders of Common Shares as directors of the Issuer
         four nominees of the holders of the Preferred Shares (of whom one must
         be a resident of Canada) for so long as a certain number of Preferred
         Shares remain outstanding (or the lesser number of nominees
         contemplated by the amendment to the articles and memorandum of the
         Issuer provided for in Section 5(z), of whom one must be a resident of
         Canada, if a fewer number of Preferred Shares remain outstanding) and
         if (and to the extent that) the holders of the Common Shares fail to
         elect as directors of the Issuer three nominees of the holders of the
         Preferred Shares for so long as a certain number of Preferred Shares
         remain outstanding, those nominees of the holders of the Preferred
         Shares shall nevertheless be entitled to receive notice of, together
         with all materials delivered to directors in respect of, and to attend,
         each meeting of the directors of the Issuer;

    (bb) it will file amended articles and an amended memorandum of the Issuer
         to create the Preferred Shares, on terms satisfactory to the
         Subscriber, acting reasonably;

    (cc) it will grant to any resident of the United States holding more than
         US$5 million principal amount of Preferred Shares, where the Common
         Shares issuable upon their conversion would not be freely tradeable in
         the United States, rights to require the Issuer, up to two times, to
         file a registration statement to qualify such Common Shares in the
         United States, provided that such rights will be exercisable commencing
         12 months after the Final Closing Date and will be at the expense of
         the Issuer and provided further that such holders will also be granted
         rights to register the Common Shares issuable upon conversion of their
         Preferred Shares in any registration statement filed by the Issuer in
         the United States in respect of Common Shares; and

    (dd) it will grant to the holders of not less than one half of the Preferred
         Shares then outstanding the right to designate, by instrument in
         writing, the nominees of the holders of the Preferred Shares to be
         included in the slate of nominees proposed for election as directors of
         the Issuer as contemplated by Sections 5(z)and 5(aa).
<PAGE>

                                     -17-

6. Closing
   -------

   (a)  The Closing will take place at the offices of Goodman Phillips &
        Vineberg, Suite 1900, 355 Burrard Street, Vancouver, British Columbia at
        8:00 a.m., Vancouver time on December 23, 1999, or on such date or
        dates and at such time or times as the Issuer and the Agent determine
        (the "Closing Date"), but in any event no later than January 15, 2000,
        unless extended in writing by the parties.

   (b)  After the Closing, the Issuer is irrevocably entitled to the
        Subscription Price, subject to the rights of the Subscriber under this
        Agreement and any applicable laws.

7. Payment and Delivery
   --------------------

   (a)  At the Closing, the Agent, on behalf of the Subscriber, will deliver or
        will have delivered to the Issuer a bank draft or certified cheque
        payable to Lions Gate Entertainment Corp. representing the net aggregate
        Subscription Price for the Units subscribed for hereunder and the Issuer
        will thereupon deliver to the Agent, on behalf of the Subscriber, a
        photocopy of this Agreement confirming the execution hereof by the
        Issuer, and issue one or more definitive certificates representing the
        Preferred Shares and Warrants constituting the Units subscribed for
        hereunder, registered in the Subscriber's name (or in such other name as
        set forth under "Alternative Registration Instructions" on the first
        page of this Agreement) and will cause to be delivered to the Agent such
        definitive certificates.

   (b)  In the event that the Closing has not occurred by January 15, 2000,
        unless extended, or this subscription is not accepted by the Issuer,
        this Agreement and the subscription proceeds, together with any other
        documents delivered in connection herewith, will be returned to the
        Subscriber at the address under "Name and Residential Address of the
        Subscriber" on the first page of this Subscription Agreement within ten
        business days of the date of such event.

8. Acceptance of Subscription
   --------------------------

   (a)  The Issuer intends to offer for issue and sale an aggregate of up to
        13,000 Units at a per Unit price of US$2,550, for an aggregate amount
        of up to US$33,150,000 in accordance with the terms of this Agreement
        and the Agency Agreement. The Issuer in its sole discretion may accept
        or reject this subscription (in whole or in part), including pursuant to
        Section 2(b).

   (b)  If this subscription is rejected, the Subscriber understands that any
        funds delivered by the Subscriber to the Agent will be promptly
        returned to the Subscriber without deduction or interest. The Subscriber
        hereby waives any requirement for the Issuer to communicate its
        acceptance of this subscription to the Subscriber. The Issuer will be
        deemed to have accepted this offer upon delivery at the Closing Date to
        the Subscriber of the certificate representing the Units referred to in
        Section 7 above.
<PAGE>

                                     -18-

9.   Authority of Agent
     ------------------

     The Subscriber irrevocably authorizes the Agent in its sole discretion:

     (a)  to act as the Subscriber's representative at the Closing, to execute
          in its name and on its behalf all required receipts and documents, to
          receive a certificate or certificates for the Preferred Shares and
          Warrants constituting the Units purchased by the Subscriber and to
          terminate this Agreement on its behalf in the event that any condition
          precedent to the offering has not been satisfied; and

     (b)  to vary any time periods, including establishing and/or changing the
          Closing Date or the time of Closing.

10.  No Assignment
     -------------

     The Subscriber may not assign all or any part of its interest in or to this
     Agreement without the written consent of the Issuer and any purported
     assignment without such consent is void.

11.  Notice
     ------

     Any notice to be given by any party to another under this Agreement will be
     deemed to be properly given when in writing and delivered by hand or
     communicated by telecopier, on any business day to the following address
     for notice of the intended recipient:

          for the Subscriber:

          To the address of the Subscriber set out under "Name and Residential
          Address of the Subscriber" on the first page of this Agreement.

          for the Issuer:

          LIONS GATE ENTERTAINMENT CORP.
          Suite 3123, Three Bentall Centre
          595 Burrard Street
          Vancouver, British Columbia
          V7X 1Jl

          Attention: Mr. Gordon Keep
          Fax: (604)609-6145

          for the Agent:

          YORKTON SECURITIES INC.
          Suite 3100
          BCE Place, 181 Bay Street
          Toronto, Ontario
          M5J 2T3
<PAGE>

                                     -19-

            Attention: Nelson Smith
            Fax: (416)864-9509

     A party may by notice to the other party change its address for notice to
     some other address and will so change its address for notice to an address
     that is adequate whenever its existing address for notice is not adequate
     for delivery by hand.

12.  Further Assurances
     ------------------

     The parties hereto each covenant and agree to execute and deliver such
     further agreements, documents and writings and provide such further
     assurances as may be required by the parties to give effect to this
     Agreement and without limiting the generality of the foregoing to do all
     acts and things, execute and deliver all documents, agreements and writings
     and provide such assurances, undertakings, information and investment
     letters as may be required from time to time by all regulatory or
     governmental bodies or stock exchanges having jurisdiction over the
     Issuer's affairs or as may be required from time to time under the
     applicable securities legislation, and any other applicable law.

13.  Miscellaneous
     -------------

     (a)  The representations, warranties and covenants contained in this
          Agreement, in any Schedule hereto, in any documents to be executed and
          delivered pursuant to this Agreement and in any documents executed and
          delivered in connection with the completion of the transaction
          contemplated herein shall survive the Closing and, notwithstanding the
          Closing and any investigations made by or on behalf of the Subscriber,
          shall continue in full force and effect for two years from the Closing
          Date and any claim in respect thereof, except a claim based on fraud
          (which may be made at any time), shall be made in writing within the
          time so limited for survival.

     (b)  This Agreement is and will be deemed to have been made in British
          Columbia and for all purposes will be governed exclusively by and
          interpreted according to the laws of British Columbia, and the parties
          hereby agree to submit to the jurisdiction of the Courts of British
          Columbia in connection with any disputes arising hereunder.

     (c)  Time is of the essence of this Agreement and will be calculated in
          accordance with the provisions of the Interpretation Act (British
          Columbia).

     (d)  Except as expressly provided in this Agreement and in the agreements,
          instruments and other documents contemplated or provided for herein,
          this Agreement contains the entire agreement between the parties with
          respect to the sale of the Units and there are no other terms,
          conditions, representations or warranties, whether expressed, implied,
          oral or written, by statute, by common law, by the Issuer, by the
          Subscriber, by the Agent, or by anyone else.
<PAGE>

                                     -20-

     (e)  This Agreement may be amended only in writing signed by each of the
          Issuer, the Agent and the Subscriber.

     (f)  In this Agreement a reference to:

          (i)   currency means United States currency;

          (ii)  a statute or code or a specific provision thereof includes every
                regulation made pursuant thereto, all amendments to the statute,
                code or any such regulation in force from time to time, and any
                statute, code or regulation that supplements or supersedes such
                statute, code or any such regulation; and

          (iii) an entity includes any entity that is a successor of such
                entity.

     (g)  The terms, provisions, representations, warranties and covenants of
          the Issuer and the Subscriber, respectively, survive the Closing, the
          payment of the Subscription Price, the issue and delivery of the
          Preferred Shares and Warrants, the completion of filings contemplated
          herein, and all other transactions contemplated herein.

     (h)  This Agreement may be executed in as many counterparts as may be
          necessary, each of which so executed shall be deemed to be an original
          and such counterparts together shall constitute one and the same
          instrument.

     (i)  This Agreement enures to the benefit of and is binding upon the
          Issuer, the Agent and the Subscriber and their respective successors
          and permitted assigns.

     (j)  The obligations of the parties hereunder are subject to any required
          regulatory approvals, if any, being obtained.

              The remainder of this page has been intentionally left blank.
<PAGE>

                                     -21-

                                Execution Page
                                --------------

IN WITNESS WHEREOF the parties have executed this Agreement as of the day,
month and year first above written.

                         PLEASE COMPLETE THIS SECTION

The undersigned Subscriber hereby subscribes for:

____ 648 _____ Units at a price of US$2,550 per Unit for a total Subscription
Price of: US$ _____________________

Future Media Productions, Inc.
---------------------------------------------------------------
Name of Subscriber (Please print)

---------------------------------------------------------------
Signature of Subscriber

Per: Alex Sandel
    -----------------------------------------------------------
    Authorized Signatory (if Subscriber is not an individual)

President /s/ ^^ILLEGIBLE SIGNATURE^^
---------------------------------------------------------------
Title

This subscription is hereby accepted as to ________________________ Units.

LIONS GATE ENTERTAINMENT CORP.

Per: /s/ ^^ILLEGIBLE SIGNATURE^^
    ------------------------------------------
            Authorized Signatory

This subscription is hereby acknowledged and the authority provided in Section 9
is hereby accepted.

YORKTON SECURITIES INC.

Per:
    ------------------------------------------
Per:           Authorized Signatory
<PAGE>

                                     -21-

                                Execution Page
                                --------------

IN WITNESS WHEREOF the parties have executed this Agreement as of the day,
month and year first above written.

                         PLEASE COMPLETE THIS SECTION

The undersigned Subscriber hereby subscribes for:

_________ Units at a price of US$2,550 per Unit for a total Subscription Price
of: US$_________________

-------------------------------------------------------------------
Name of Subscriber (Please print)

-------------------------------------------------------------------
Signature of Subscriber

Per:
    ---------------------------------------------------------------
    Authorized Signatory (if Subscriber is not an individual)

-------------------------------------------------------------------
Title

This subscription is hereby accepted as to _____________________ Units.

LIONS GATE ENTERTAINMENT CORP.

Per:
    ---------------------------------------------------------------
                    Authorized Signatory

This subscription is hereby acknowledged and the authority provided in Section 9
is hereby accepted.

YORKTON SECURITIES INC.

Per:
     /s/ NELSON SMITH
     --------------------------------------------------------------
Per: Authorized Signatory
<PAGE>

                                     -21-

                                Execution Page
                                --------------

IN WITNESS WHEREOF the parties have executed this Agreement as of the day, month
and year first above written.

                         PLEASE COMPLETE THIS SECTION

The undersigned Subscriber hereby subscribes for:

_____ 648 _____ Units at a price of US$2,550 per Unit for a total Subscription
Price of: US$_________________

Future Media Productions, Inc.
----------------------------------------------------------------
Name of Subscriber (Please print)

----------------------------------------------------------------
Signature of Subscriber

Per:  Alex Sandel
     -----------------------------------------------------------
     Authorized Signatory (if Subscriber is not an individual)

President         ^^ILLEGIBLE SIGNATURE^^
----------------------------------------------------------------
Title

This subscription is hereby accepted as to __________________ Units.

LIONS GATE ENTERTAINMENT CORP.

Per:
    ------------------------------------------------------------
                     Authorized Signatory

This subscription is hereby acknowledged and the authority provided in Section 9
is hereby accepted.

YORKTON SECURITIES INC.

Per:
    ------------------------------------------------------------
Per:                 Authorized Signatory
<PAGE>

                                      A-l

                    SCHEDULE "A" TO SUBSCRIPTION AGREEMENT

                       U.S. Representations & Warranties
                       ---------------------------------

     If the Subscriber falls under one of the categories listed in Section
4(i)(ii) of the Subscription Agreement, by executing the Subscription Agreement,
the Subscriber, on its own behalf and, if applicable on behalf of others for
whom it is contracting, represents, warrants and acknowledges to the Issuer the
following:

     (a)   the Subscriber is acquiring the Units for its own account, for
           investment purposes only and not with a view to any resale,
           distribution or other disposition of the Units in violation of the
           United States securities laws;

     (b)   if the Subscriber decides to offer, sell or otherwise transfer any of
           the Units, the Preferred Shares, the Warrants or the Common Shares
           issuable upon conversion of the Preferred Shares or upon exercise of
           the Warrants, it will not offer, sell or otherwise transfer any of
           such securities directly or indirectly, unless:

           (i)    the sale is to the Issuer;

           (ii)   the sale is made outside the United States in a transaction
                  meeting the requirements of Rule 904 of Regulation S under the
                  U.S. Securities Act and in compliance with applicable local
                  laws and regulations;

           (iii)  the sale is made pursuant to the exemption from the
                  registration requirements under the U.S. Securities Act
                  provided by Rule 144 thereunder and in accordance with any
                  applicable state securities or "Blue Sky" laws; or

           (iv)   such securities are sold in a transaction exempt from
                  registration under the U.S. Securities Act or any applicable
                  state laws and regulations governing the offer and sale of
                  securities, and it has prior to such sale furnished to the
                  Issuer satisfactory evidence of the availability of such
                  exemption which may, at the Issuer's discretion, include an
                  opinion of counsel;

     (c)   the Subscriber understands and agrees that there may be material tax
           consequences to the Subscriber of an acquisition or disposition of
           the Units, the Preferred Shares, the Warrants or the Common Shares
           issuable upon conversion of the Preferred Shares or upon exercise of
           the Warrants. The Issuer gives no opinion and makes no
           representation with respect to the tax consequences to the Subscriber
           under United States, state, local or foreign tax law of the
           undersigned's acquisition or disposition of such securities. In
           particular, no determination has been made whether the Issuer will be
           a "passive foreign investment company" ("PFIC") within the meaning of
           Section 1291 of the United States Internal Revenue Code;
<PAGE>

                                      A-2

(d)   the Subscriber understands and agrees that the financial statements of the
      Issuer have been prepared in accordance with Canadian generally accepted
      accounting principles, which differ in some respects from United States
      generally accepted accounting principles, and thus may not be comparable
      to financial statements of United States companies; and

(e)   the Subscriber understands that all certificates representing the
      Preferred Shares, the Warrants and the Common Shares issuable upon
      conversion of the Preferred Shares and upon exercise of the Warrants,
      sold in the United States as part of the Offering, and all certificates
      issued in exchange for or in substitution of the foregoing securities,
      will bear a legend to the following effect:

      THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN AND WILL NOT BE REGISTERED
      UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE "U.S.
      SECURITIES ACT")NOR THE SECURITIES ACT OF ANY STATE OF THE UNITED STATES.
      THESE SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, OR OTHERWISE
      TRANSFERRED OR ASSIGNED UNLESS THEY ARE OFFERED FOR SALE, SOLD OR
      OTHERWISE TRANSFERRED OR ASSIGNED: (A) TO THE COMPANY, (B) OUTSIDE THE
      UNITED STATES IN ACCORDANCE WITH RULE 904 OF REGULATION S UNDER THE U.S.
      SECURITIES ACT, (C) PURSUANT TO THE EXEMPTION FROM THE REGISTRATION
      REQUIREMENTS UNDER THE U.S. SECURITIES ACT PROVIDED BY RULE 144
      THEREUNDER, IF AVAILABLE AND IN ACCORDANCE WITH APPLICABLE STATE
      SECURITIES LAW, OR (D) PURSUANT TO ANOTHER EXEMPTION FROM REGISTRATION
      AFTER PROVIDING A SATISFACTORY LEGAL OPINION TO THE COMPANY;

      provided that, if any such Preferred Shares, Warrants and Common Shares
      issuable upon conversion of the Preferred Shares and upon exercise of the
      Warrants, are being sold outside the United States in accordance with Rule
      904 of Regulation S, the legend relating to United States securities laws
      may be removed by providing a declaration to the Issuer in such form as
      the Issuer's counsel from time to time prescribes; and provided, further,
      that, if any such securities are being sold under paragraph (C) above, the
      legend relating to the United States securities laws may be removed by
      delivery to the Issuer, of an opinion of counsel, of recognized standing
      reasonably satisfactory to the Issuer's counsel, that such legend is no
      longer required under applicable requirements of the U.S. Securities Act
      or state securities laws.
<PAGE>

                                      A-3

                   Appendix "A" to Subscription Agreement

                 Relevant Provisions of the Investment Canada Act

1.   Section 3 - Definitions:

     "Canadian" means

     (a)   a Canadian citizen,

     (b)   a permanent resident within the meaning of the Immigration Act who
           has been ordinarily resident in Canada for not more than one year
           after the time at which he first became eligible to apply for
           Canadian citizenship,

     (c)   a Canadian government, whether federal, provincial or local, or an
           agency thereof, or

     (d)   an entity that is Canadian-controlled, as determined pursuant to
           subsection 26(1) or (2) and in respect of which no determination or
           declaration has been made under subsection 26(2.1) or (2.2).

     "voting group" means two or more persons who are associated with respect to
     the exercise or rights attached to voting interests in an entity by
     contract, business arrangement, personal relationship, common control in
     fact through the ownership of voting interests, or otherwise, in such a
     manner that they would ordinarily be expected to act together on a
     continuing basis with respect to the exercise of those rights.

     "voting interest", with respect to

     (a)   a corporation with share capital, means a voting share,

     (b)   a corporation without share capital, means an ownership interest in
           the assets thereof that entitles the owner to rights similar to those
           enjoyed by the owner of a voting share, and

     (c)   a partnership, trust or joint venture, means an ownership interest in
           the assets thereof that entitles the owner to receive a share of the
           profits and to share in the assets on dissolution.

     "voting share" means a share in the capital of a corporation to which is
     attached a voting right ordinarily exercisable at meetings of shareholders
     of the corporation and to which is ordinarily attached a right to receive a
     share of profits, or to share in the assets of the corporation on
     dissolution, or both.

2.   Section 26(l) to (2.2) - Rules Respecting Control of Entities:

     (1)   Subject to subsections (2.1) and (2.2), for the purposes of this Act,

     (a)   where one Canadian or two or more members of a voting group who are
           Canadians own a majority of the voting interests of an entity, it is
           a Canadian-controlled entity;
<PAGE>

                                      A-4

(b)    where paragraph (a) does not apply and one non-Canadian or two or more
       members of a voting group who are non-Canadians own a majority of the
       voting interests of an entity, it is not a Canadian-controlled entity;

(c)    where paragraphs (a) and (b) do not apply and a majority of the voting
       interests of an entity are owned by Canadians and it can be established
       that the entity is not controlled in fact through the ownership of its
       voting interests by one non-Canadian or by a voting group in which a
       member or members who are non-Canadians own one-half or more of those
       voting interests of the entity owned by the voting group, it is a
       Canadian entity; and

(d)    where paragraphs (a) to (c) do not apply and less than a majority of the
       voting interests of an entity are owned by Canadians, it is presumed not
       to be a Canadian-controlled entity unless the contrary can be established
       by showing that:

       (i)   the entity is controlled in fact through the ownership of its
             voting interests by one Canadian or by a voting group in which a
             member or members who are Canadians own a majority of those voting
             interests of the entity owned by the voting group, or

       (ii)  in the case of an entity that is a corporation or limited
             partnership, the entity is not controlled in fact through the
             ownership of its voting interest and two-thirds of the members of
             its board of directors or, in the case of a limited partnership,
             two-thirds of its general partners, are Canadians.

(2)    Subject to subsection (2.1) and (2.2), where it can be established that a
       trust is not controlled in fact through the ownership of its voting
       interests, subsection (1) does not apply and the trust is a Canadian-
       controlled entity where two-thirds of its trustees are Canadians.

(2.1)  Where an entity that carries on or proposes to carry on a specific type
       of business activity that is prescribed for the purposes of paragraph
       15(a) qualifies as a Canadian-controlled entity by virtue of subsection
       (1) or (2), the Minister may nevertheless determine that the entity is
       not a Canadian-controlled entity where, after considering any information
       and evidence submitted by or on behalf of the entity or otherwise made in
       fact by one or more non-Canadians.

(2.2)  Where an entity referred to in subsection (2.1) has refused or neglected
       to provide, within a reasonable time, information that the Minister or
       the Director has requested and that the Minister considers necessary in
       order to make a decision under that subsection, the Minister may declare
       that the entity is not a Canadian-controlled entity.<PAGE>

                                                                   EXHIBIT 10.25

              [LOGO] AMERICAN INDUSTRIAL REAL ESTATE ASSOCIATION

            STANDARD INDUSTRIAL/COMMERCIAL SINGLE-TENANT LEASE--NET
               (DO NOT USE THIS FORM FOR MULTI-TENANT BUILDINGS)

1.  Basic Provisions ("Basic Provisions").

     1.1  Parties:  This Lease ("Lease"), dated for reference purposes only,
March 1, 2000, is made by and between 24811 Avenue Rockefeller, LLC, a Delaware
limited liability company ("Lessor") and Future Media Productions, a California
corporation (collectively, "Lessee"), (collectively the "Parties," or
individually a "Party").

     1.2  Premises:  That certain real property, including all improvements
therein or to be provided by Lessor under the terms of this Lease, and commonly
known as 24811 Avenue Rockefeller, Santa Clarita, located in the County of Los
Angeles, State of California, and generally described as (describe briefly the
nature of the property and, if applicable, the "Project", if the property is
located within a Project) an approximate 82,835 square foot building situated on
approximately 3.47 acres of land ("Premises"). (See also Paragraph 2)

     1.3  Term:  13 years and 10 months ("Original Term") commencing March 1,
2000 ("Commencement Date") and ending December 31, 2013 (See Addendum Paragraph
52) ("Expiration Date"). (See also Paragraph 3)

     1.5  Base Rent:  $53,842.75 ($.65 x 82,835 sq. ft.) per month ("Base
Rent"), payable on the 1st day of each month commencing March 1, 2000. (See also
Paragraph 4)

[X] If this box is checked, there are provisions in this Lease for the Base Rent
    to be adjusted. See Addendum Paragraph 50 and Paragraph 51.

     1.6  Base Rent Paid Upon Execution:  $53,842.75 as Base Rent for the period
March 1, 2000 through March 31, 2000.

     1.7  Security Deposit: $53,842.75 ("Security Deposit"). (See also Paragraph
5).

     1.8  Agreed Use: Any legal use (See also Paragraph 6).

     1.9  Insuring Party:  Lessee is the "Insuring Party" unless otherwise
stated herein. (See also Paragraph 8).

     1.10 Real Estate Brokers: (See also Paragraph 15) None. See Addendum
Paragraph 52.

     1.12 Addenda and Exhibits.  Attached hereto is an Addendum or Addenda
consisting of Paragraphs 50 through 53 and Exhibits___, all of which constitute
a part of this Lease.

2.  Premises.

     2.1  Letting.  Lessor hereby leases to Lessee, and Lessee hereby leases
from Lessor, the Premises, for the term, at the rental, and upon all of the
terms, covenants and conditions set forth in this Lease. Unless otherwise
provided herein, any statement of size set forth in this Lease, or that may have
been used in calculating rental, is an approximation which the Parties agree is
reasonable and the rental based thereon is not subject to revision whether or
not the actual size is more or less.

     2.2  Condition.  Lessor shall deliver the Premises to Lessee broom clean
and free of debris on the Commencement Date ("Start Date"). Lessor makes no
warranty as to the condition of the existing electrical, plumbing, fire
sprinkler, lighting, heating, ventilating and air conditioning systems,
("HVAC"), loading doors, if any, and all other such elements in the Premises.

                                 Page 1 of 15

                                                   Initials
                                                            ---------  ---------
<PAGE>

    2.3 Compliance. Lessor warrants that the improvements on the Premises comply
with all applicable laws, covenants or restrictions of record, building codes,
regulations and ordinances ("Applicable Requirements") in effect of the Start
Date. Said warranty does not apply to the use to which Lessee will put the
Premises or to any Alterations or Utility Installations (as defined in Paragraph
7.3(a)) made or to be made by Lessee. NOTE: Lessee is responsible for
determining whether or not the zoning is appropriate for Lessee's intended use,
and acknowledges that past uses of the Premises may no longer be allowed. If the
Premises do not comply with said warranty, Lessor shall, except as otherwise
provided, promptly after receipt of written notice from Lessee setting forth
with specificity the nature and extent of such non-compliance, rectify the same
at Lessor's expense. If Lessee does not give Lessor written notice of non-
compliance with this warranty within six (6) months following the Start Date,
correction of that non-compliance shall be the obligation of Lessee at Lessee's
sole cost and expense. If the Applicable Requirements are hereafter changed (as
opposed to being in existence at the Start Date, which is addressed in Paragraph
6.2(e) below) so as to require during the term of this Lease the construction of
an addition to or an alteration of the Building, the remediation of any
Hazardous Substance, or the reinforcement or other physical modification of the
Building ("Capital Expenditure"), Lessor and Lessee shall allocate the cost of
such work as follows:

          (a) Subject to Paragraph 2.3(c) below, if such Capital Expenditures
are required as a result of the specific and unique use of the Premises by
Lessee as compared with uses by tenants in general, Lessee shall be fully
responsible for the cost thereof.

          (b) If such Capital Expenditure is not the result of the specific and
unique use of the Premises by Lessee (such as, governmentally mandated seismic
modifications), then Lessor and Lessee shall allocate the obligation to pay for
such costs pursuant to the provisions of Paragraph 7.1(c); provided, however,
that if such Capital Expenditure is required during the last two years of this
Lease or if Lessor reasonably determines that it is not economically feasible to
pay its share thereof, Lessor shall have the option to terminate this Lease upon
ninety (90) days prior written notice to Lessee unless Lessee notifies Lessor,
in writing, within ten (10) days after receipt of Lessor's termination notice
that Lessee will pay for such Capital Expenditure. If Lessor does not elect to
terminate, and fails to tender its share of any such Capital Expenditure, Lessee
may advance such funds and deduct same, with Interest, from Rent until Lessor's
share of such costs have been fully paid. If Lessee is unable to finance
Lessor's share, or if the balance of the Rent due and payable for the remainder
of this Lease is not sufficient to fully reimburse Lessee on an offset basis,
Lessee shall have the right to terminate this Lease upon thirty (30) days
written notice to Lessor.

          (c) Notwithstanding the above, the provisions concerning Capital
Expenditures are intended to apply only to non-voluntary, unexpected, and new
Applicable Requirements. If the Capital Expenditures are instead triggered by
Lessee as a result of an actual or proposed change in use, change in intensity
of use, or modification to the Premises then, and in that event, Lessee shall be
fully responsible for the cost thereof, and Lessee shall not have any right to
terminate this Lease.

    2.4 Acknowledgements. Lessee acknowledges that: (a) it has been advised by
Lessor to satisfy itself with respect to the condition of the Premises
(including but not limited to the electrical, HVAC and fire sprinkler systems,
security, environmental aspects, and compliance with Applicable Requirements),
and their suitability for Lessee's intended use; (b) Lessee has made such
investigation as it deems necessary with reference to such matters and assumes
all responsibility therefor as the same relate to its occupancy of the Premises;
and (c) neither Lessor, Lessor's agents, nor any Broker has made any oral or
written representations or warranties with respect to said matters other than as
set forth in this Lease. In addition, Lessor acknowledges that: (a) Broker has
made no representations, promises or warranties concerning Lessee's ability to
honor the Lease or suitability to occupy the Premises; and (b) it is Lessor's
sole responsibility to investigate the financial capability and/or suitability
of all proposed tenants.

3. Term. See, also, Paragraph 39 and Addendum Paragraph 53.

        3.1 Term. The Commencement Date, Expiration Date and Original Term of
this Lease are as specified in Paragraph 1.3 and Addendum Paragraph 50.

        3.3 Delay in Possession. Lessor agrees to use its best commercially
reasonable efforts to deliver possession of the Premises to Lessee by the
Commencement Date. If, despite said efforts, Lessor is unable to deliver
possession as agreed, Lessor shall not be subject to any liability thereof, nor
shall such failure affect the validity of this Lease. Lessee shall not, however,
be obligated to pay Rent or perform its other obligations until it receives
possession of the Premises. If possession is not delivered within sixty (60)
days after the Commencement Date, Lessee may, at its option, by notice in
writing within ten (10) days after the end of such sixty (60) day period, cancel
this Lease, in which event the Parties shall be discharged from all obligations
hereunder. If such written notice is not received by Lessor within said ten (10)
day period, Lessee's right to cancel shall terminate. Except as otherwise
provided, if possession is not tendered to Lessee by the Start Date and Lessee
does not terminate this Lease, as aforesaid, any period of rent abatement that
Lessee would otherwise have enjoyed shall run from the date of delivery of
possession and continue for a period equal to what Lessee would otherwise have
enjoyed under the terms hereof, but minus any days of delay caused by the acts
or omissions of Lessee. If possession of the Premises is not delivered within
four (4) months after the Commencement Date, this Lease shall terminate unless
other agreements are reached between Lessor and Lessee, in writing.

    3.4 Lessee Compliance. Lessor shall not be required to tender possession of
the Premises to Lessee until Lessee compiles with its obligation to provide
evidence of insurance (Paragraph 8.5). Pending delivery of such evidence, Lessee
shall be  required to perform all of its obligations under this Lease from and
after the Start Date, including the payment of Rent, notwithstanding Lessors
election to withhold possession pending receipt of such evidence of insurance.
Further, if Lessee is required to perform any other conditions prior to or
concurrent with the Start Date, the Start Date shall occur but Lessor may elect
to withhold possession until such conditions are satisfied.

4.  Rent. See Addendum Paragraph 50 and Paragraph 51.

    4.1 Rent Defined. All monetary obligations of Lessee to Lessor under the
terms of this Lease are deemed to be rent

                                 Page 2 of 15                Initials ____  ____
<PAGE>

("Rent")

     4.2  Payment. Lessee shall cause payment of Rent to be received by Lessor
in lawful money of the United States, without offset or deduction (except as
specifically permitted in this Lease), on or before the day on which it is due.
Rent for any period during the term hereof which is for less than one (1) full
calendar month shall be prorated based upon the actual number of days of said
month. Payment of Rent shall be made to Lessor at its address stated herein or
to such other persons or place as Lessor may from time to time designate in
writing. Acceptance of a payment which is less than the amount then due shall
not be a waiver of Lessor's rights to the balance of such Rent, regardless of
Lessor's endorsement of any check so stating.

5.   Security Deposit. Lessee shall deposit with Lessor upon execution hereof
the Security Deposit as security for Lessee's faithful performance of its
obligations under this Lease. If Lessee fails to pay Rent, or otherwise Defaults
under this Lease, Lessor may use, apply or retain all or any portion of said
Security Deposit for the payment of any amount due Lessor or to reimburse or
compensate Lessor for any liability, expense, loss or damage which Lessor may
suffer or incur by reason thereof. If Lessor uses or applies all or any portion
of said Security Deposit, Lessee shall within ten (10) days after written
request there for deposit monies with Lessor sufficient to restore said Security
Deposit to the full amount required by this Lease. If the Base Rent increases
during the term of this Lease, Lessee shall, upon written request from Lessor,
deposit additional monies with Lessor so that the total amount of the Security
Deposit shall at all times bear the same proportion to the increased Base Rent
as the initial Security Deposit bore to the initial Base Rent. Should the Agreed
Use be amended to accommodate a material change in the business of Lessee or to
accommodate a sublessee or assignee, Lessor shall have the right to increase the
Security Deposit to the extent necessary, in Lessor's reasonable judgment, to
account for any increased wear and tear that the Premises may suffer as a result
thereof. If a change in control of Lessee occurs during this Lease and following
such change the financial condition of Lessee is, in Lessor's reasonable
judgment, significantly reduced, Lessee shall deposit such addition monies with
Lessor as shall be sufficient to cause the Security Deposit to be at a
commercially reasonable level based on said change in financial condition.
Lessor shall not be required to keep the Security Deposit separate from its
general accounts. Within fourteen (14) days after the expiration or termination
of this Lease, if Lessor elects to apply the Security Deposit only to unpaid
Rent, and otherwise within thirty (30) days after the Premises have been vacated
pursuant to Paragraph 7.4(c) below, Lessor shall return that portion of the
Security Deposit not used or applied by Lessor. No part of the Security Deposit
shall be considered to be held in trust, to bear interest or to be prepayment
for any monies to be paid by Lessee under this Lease.

6.   Use.

     6.1  Use.  Lessee shall use and occupy the Premises only for the Agreed
Use, or any other legal use which is reasonably comparable thereto, and for no
other purpose. Lessee shall not use or permit the use of the Premises in a
manner that is unlawful, creates damage, waste or a nuisance, or that disturbs
owners and/or occupants of, or causes damage to neighboring properties. Lessor
shall not unreasonably withhold or delay its consent to any written request for
a modification of the Agreed Use, so long as the same will not impair the
structural integrity of the improvements of the Premises or the mechanical or
electrical systems therein, is not significantly more burdensome to the
Premises. If Lessor elects to withhold consent, Lessor shall within five (5)
business days after such request give written notification of same, which notice
shall include an explanation of Lessor's objections to the change in use.

     6.2  Hazardous Substances.

          (a)  Reportable Uses Require Consent.  The term "Hazardous Substance"
as used in this Lease shall mean any product, substance, or waste whose
presence, use, manufacture, deposit, transportation, or release, either by
itself or in combination with other materials expected to be on the Premises, is
either: (i) potentially injurious to the public health, safety or welfare, the
environment or the Premises, (ii) regulated or monitored by any governmental
authority, or (iii) a basis for potential liability of Lessor to any
governmental agency or third party under any applicable statute or common law
theory. Hazardous Substances shall include, but not be limited to, hydrocarbons,
petroleum, gasoline, and/or crude oil or any products, by-procuts or fractions
thereof. Lessee shall not engage in any activity in or on the Premises which
constitutes a Reportable Use of Hazardous Substances without the express prior
written consent of Lessor and timely compliance (at Lessee's expense) with all
Applicable Requirements. "Reportable Use" shall mean (i) the installation or use
of any above or below ground storage tank, (ii) the generation, possession,
storage, use, transportation, or disposal of a Hazardous Substance that requires
a permit from, or with respect to which a report, notice, registration or
business plan is required to be filed with, any governmental authority, and/or
(iii) the presence at the Premises of a Hazardous Substance with respect to
which any Applicable Requirements requires that a notice be given to persons
entering or occupying the Premises or neighboring properties. Notwithstanding
the foregoing, Lessee may use any ordinary and customary materials reasonably
required to be used in the normal course of the Agreed Use, so long as such use
is in compliance with all Applicable Requirements, is not a Reportable Use, and
does not expose the Premises or neighboring property to any meaningful risk of
contamination or damage or expose Lessor to any liability therefor. In addition,
Lessor may condition its consent to any Reportable Use upon receiving such
additional assurances as Lessor reasonably deems necessary to protect itself,
the public, the Premises and/or the environment against damage, contamination,
injury and/or liability, including, but not limited to, the installation (and
removal on or before Lease expiration or termination) of protective
modifications (such as concrete encasements) and/or increasing the Security
Deposit.

          (b)  Duty to Inform Lessor. If Lessee knows, or has reasonable cause
to believe, that a Hazardous Substance has come to be located in, on, under or
about the Premises, other than as previously consented to by Lessor, Lessee
shall immediately give written notice of such fact to Lessor, and provide Lessor
with a copy of any report, notice, claim or other documentation which it has
concerning the presence of such Hazardous Substance.

          (c)  Lessee Remediation. Lessee shall not cause or permit any
Hazardous Substance to be spilled or released in, on, under, or about the
Premises (including through the plumbing or sanitary sewer system) and shall
promptly, at Lessee's expense, take all investigatory and/or remedial action
reasonably recommended, whether or not formally ordered or required, for the
cleanup of any contamination of, and for the maintenance, security and/or
monitoring of the Premises or neighboring properties, that was caused or
materially contributed to by Lessee, or pertaining to or involving any Hazardous
Substance brought onto the Premises during the term of this Lease, by or for
Lessee, or any third party.

          (d)  Lessee Indemnification.  Solely as between Lessee and Lessor,
Lessee shall indemnify, defend and hold Lessor, its agents, employees, lenders
and ground lessor, if any, harmless from and against any and all loss of rents
and/or damages, liabilities, judgments, claims, expenses, penalties, and
attorneys' and consultants' fees arising out of or involving any Hazardous
Substance brought onto the Premises by or for Lessee, or any third party
(provided, however, that Lessee shall have no liability under this Lease with
respect to underground migration of any Hazardous Substance under the Premises
from adjacent properties). Lessee's obligations shall include, but not be
limited to, the effects of any contamination or injury to person, property or
the environment created or suffered by Lessee, and the cost of investigation,
removal, remediation, restoration and/or abatement, and shall survive the
expiration or termination of this Lease. No termination, cancellation or release
agreement entered into by Lessor and Lessee shall release Lessee from its
obligations under this Lease with respect to Hazardous Substances, unless
specifically so agreed by Lessor in writing at the time of such agreement.

          (e)  Lessor Indemnification.  Solely as between Lessor and Lessee,
Lessor and its successors and assigns shall indemnify, defend, reimburse and
hold Lessee, its employees and lenders, harmless from and against any and all
environmental damages, including the cost of remediation, which existed as a
result of Hazardous Substances on the Premises prior to the Start Date or which
are caused by the gross negligence or willful misconduct of Lessor, its

                                 Page 3 of 15                       Initials____
<PAGE>

agents or emplyees.  Lessor's obligations, as and when required by the
Applicable Requirements, shall include, but not be limited to, the cost of
investigation removal, remediation, restoration and/or abatement, and shall
survive the expiration or termination of this Lease.

          (f) investigations and Remediations. Lessee shall be responsible for
and shall pay for any investigations or remediation measures required by
governmental entities having jurisdiction with respect to the existence of
Hazardous Substances on the Premises Lessor shall cooperate fully in any such
activities at the request of Lessee, including allowing Lessor and Lessor's
agents to have reasonable access to the Premises at reasonable times in order to
carry out Lessor's investigative and remedial responsibilities.

     6.3 Lessee's Compliance with Applicable Requirements. Except as otherwise
provided in this Lease, Lessee shall, at Lessee's sole expense, fully,
diligently and in a timely manner, materially comply with all Applicable
Requirements, the requirements of any applicable fire insurance underwriter or
rating bureau, and the recommendations of Lessor's engineers and/or consultants
which relate in any manner to the Premises, without regard to whether said
requirements are now in effect or become effective after the Start Date. Lessee
shall, within ten (10) days after receipt of Lessor's written request, provide
Lessor with copies of all permits and other documents, and other information
evidencing Lessee's compliance with any Applicable Requirements specified by
Lessor, and shall immediately upon receipt, notify Lessor in writing (with
copies of any documents involved) of any threatened or actual claim, notice,
citation, warning, complaint or report pertaining to or involving the failure of
Lessee or the Premises to comply with any Applicable Requirements.

      6.4 Inspection; Compliance. Lessor and Lessor's "Lender" (as defined in
Paragraph 30 below) and consultants shall have the right to enter into Premises
at any time, in the case of an emergency, and otherwise at reasonable times, for
the purpose of inspecting the condition of the Premises and for verifying
compliance by Lessee with this Lease. The cost of any such inspections shall be
paid by Lessor, unless a violation of Applicable Requirements, or a
contamination is found to exist or be imminent, or the inspection is requested
or ordered by a governmental authority. In such case, Lessee shall upon request
reimburse Lessor for the cost of such inspections, so long as such inspection
is reasonably related to the violation or contamination.

7.        Maintenance; Repairs, Utility Installations; Trade Fixtures and
Alterations.

      7.1 Lessee's Obligations.

          (a) In General.  Subject to the provisions of Paragraph 2.3
(Compliance), 6.3 (Lessee's Compliance with Applicable Requirements), 7.2
(Lessor's Obligations), 9 (Damage or Destruction), and 14 (Condemnation), Lessee
shall, at Lessee's sole expense, keep the Premises, Utility Installations, and
Alterations in good order, condition and repair (whether or not the portion of
the Premises requiring repairs, or the means of repairing the same, are
reasonably or readily accessible to Lessee, and whether or not the need for such
repairs occurs as a result of Lessee's use, any prior use, the elements or the
age of such portion of the Premises), including, but not limited to, all
equipment or facilities, such as plumbing, heating, ventilating, air-
conditioning, electrical, lighting facilities, boilers, pressure vessels, fire
protection system, fixtures, walls (interior and exterior), foundations,
ceilings, roofs, floors, windows, doors, plate glass, skylights, landscaping,
driveways, parking lots, fences, retaining walls, signs, sidewalks and parkways
located in, on, or adjacent to the Premises. Lessee, in keeping the Premises in
good order, condition and repair, shall exercise and perform good maintenance
practices, specifically including the procurement and maintenance of the service
contracts required by Paragraph 7.1(b) below. Lessee's obligations shall include
restorations, replacements or renewals when necessary to keep the Premises and
all improvements thereon or a part thereof in good order, condition and state of
repair. Lessee shall, during the term of this Lease, keep the exterior
appearance of any buildings on the Premises (the "Building") in a first-class
condition consistent with the exterior appearance of other similar facilities of
comparable age and size in the vicinity, including, when necessary, the exterior
repainting of the Building.

          (b) Service Contracts. Lessee shall, at Lessee's sole expense, procure
and maintain contracts, with copies to Lessor, in customary form and substance
for, and with contractors specializing and experienced in the maintenance of the
following equipment and improvements, if any, if and when installed on the
Premises: (iv) landscaping and irrigation systems, (v) roof covering and drains,
(vi) driveways and parking lots, and (ix) any other equipment, if reasonably
required by Lessor.

          (c) Replacement. Subject to Lessee's indemnification of Lessor as set
forth in Paragraph 8.7 below, and without relieving Lessee of liability
resulting from Lessee's failure to exercise and perform good maintenance
practices, if the Basic Elements described in Paragraph 7.1(b) cannot be
repaired other than at a cost which is in excess of 50% of the cost of replacing
such Basic Elements, then such Basic Elements shall be replaced by Lessor, and
the cost thereof shall be prorated between the Parties and Lessee shall only be
obligated to pay, each month during the remainder of the term of this Lease, on
the date on which Base Rent is due, an amount equal to the product of
multiplying the cost of such replacement by a fraction, the numerator of which
is one, and the denominator of which is the number of months of the useful life
of such replacement as such useful life is specified pursuant to Federal income
tax regulations or guidelines for depreciation thereof (including interest on
the unamortized balance as is then commercially reasonable in the judgement of
Lessor's accountants), with Lessee reserving the right to prepay its obligation
at any time.

          7.2 Lessor's Obligations. Subject to the provisions of Paragraphs 2.3
(Compliance), 9 (Damage or Destruction) and 14 (Condemnation), it is intended by
the Parties hereto that Lessor have no obligation, in any manner whatsoever, to
repair and maintain the Premises, or the equipment therein, all of which
obligations are intended to be that of the Lessee. It is the intention of the
Parties that the terms of this Lease govern the respective obligations of the
Parties as to maintenance and repair of the Premises, and they expressly waive
the benefit of any statute now or hereafter in effect to the extent it is
inconsistent with the terms of this Lease.

                                 Page 4 of 15        Initials ________ ________

<PAGE>

      7.3   Utility Installations; Trade Fixtures; Alterations.

            (a) Definitions; Consent Required. The term "Utility Installations"
refers to all floor and window coverings, air lines, power panels, electrical
distribution, security and fire protection systems, communication systems,
lighting fixtures, heating, ventilating and air conditioning systems ("HVAC"
equipment, plumbing and fencing in or on the Premises. The term "Trade Fixtures"
shall mean Lessee's machinery and equipment that can be removed without doing
material damage to the Premises. The term "Alterations" shall mean any
modification of the improvements, other than Utility installations or Trade
Fixtures whether by addition or deletion. "Lessee Owned Alterations and/or
Utility Installations" are defined as Alterations and/or Utility installations
made by Lessee that are not yet owned by Lessor pursuant to Paragraph 7.4(a).
Lessee shall not make any Alterations or Utility Installations to the Premises
without Lessor's prior written consent. Lessee may, however, make non-structural
Utility installations to the interior of the Premises (excluding the roof)
without such consent but upon notice to Lessor, as long as they are not visible
from the outside, do not involve puncturing, relocating or removing the roof or
any existing walls, and the cumulative cost thereof during this Lease as
extended does not exceed $50,000 in the aggregate or $10,000 in any one year.

            (b) Consent. Any Alterations or Utility Installations that Lessee
shall desire to make and which require the consent of the Lessor shall be
presented to Lessor in written form with detailed plans. Consent shall be deemed
conditioned upon Lessee's: (i) acquiring all applicable governmental permits,
(ii) furnishing Lessor with copies of both the permits and the plans and
specifications prior to commencement of the work and, (iii) compliance with all
conditions of said permits and other Applicable Requirements in a prompt and
expeditious manner. Any Alterations or Utility Installations shall be performed
in a workmanlike manner with good and sufficient materials. Lessee shall
promptly upon completion furnish Lessor with as-built plans and specifications.
For work which costs an amount greater than $10,000, Lessor may condition its
consent upon Lessee providing a lien and completion bond in an amount equal to
one and one-half times the estimated cost of such Alteration or Utility
Installation and/or upon Lessee's posting an additional Security Deposit with
Lessor.

            (c) Indemnification. Lessee shall pay, when due, all claims for
labor or materials furnished or alleged to have been furnished to or for Lessee
at or for use on the Premises, which claims are or may be secured by any
mechanic's or materialmen's lien against the Premises or any interest therein.
Lessee shall give Lessor not less than ten (10) days' notice prior to the
commencement of any work in, on or about the Premises, and Lessor shall have the
right to post notices of non-responsibility. If Lessee shall contest the
validity of any such lien, claim or demand, then Lessee shall, at its sole
expense defend and protect itself, Lessor and the Premises against the same and
shall pay and satisfy any such adverse judgment that may be rendered thereon
before the enforcement thereof. If Lessor shall require, Lessee shall furnish a
surety bond in an amount equal to one and one-half times the amount of such
contested lien, claim or demand, indemnifying Lessor against liability for the
same. If Lessor elects to participate in any such action, Lessee shall pay
Lessor's attorneys' fees and costs.

     7.4    Ownership; Removal; Surrender; and Restoration.

            (a) Ownership. Subject to Lessor's right to require removal or elect
ownership as hereinafter provided, all Alterations and Utility Installations
made by Lessee shall be the property of Lessee, but considered a part of the
Premises. Lessor may, at any time, elect in writing to be the owner of all or
any specified part of the Lessee Owned Alterations and Utility Installations.
Unless otherwise instructed per Paragraph 7.4(b) hereof, all Lessee Owned
Alterations and Utility Installations shall, at the expiration or termination of
this Lease, become the property of Lessor and be surrendered by Lessee with the
Premises.

            (b) Removal. By delivery to Lessee of written notice from Lessor not
earlier than ninety (90) and not later than thirty (30) days prior to the end of
the term of this Lease, Lessor may require that any or all Lessee Owned
Alterations or Utility Installations be removed by the expiration or termination
of this Lease. Lessor may require the removal at any time of all or any part of
any Lessee Owned Alterations or Utility Installations made without the required
consent.

            (c) Surrender/Restoration. Lessee shall surrender the Premises by
the Expiration Date or any earlier termination date, with all of the
improvements, part and surfaces thereof broom clean and free of debris, and in
good operating order, condition and state of repair, ordinary wear and tear
excepted. "Ordinary wear and tear" shall not include any damage or deterioration
that would have been prevented by good maintenance practice. Lessee shall repair
any damage occasioned by the installation, maintenance or removal of Trade
Fixtures, Lessee Owned Alterations and/or Utility Installations, furnishings,
and equipment as well as the removal of any storage tank installed by or for
Lessee, and the removal, replacement, or remediation of any soil, material or
groundwater contaminated by Lessee. Trade Fixtures shall remain the property of
Lessee, shall be removed by Lessee. The failure by Lessee to timely vacate the
Premises pursuant to this Paragraph 7.4(c) without the express written consent
of Lessor shall constitute a holdover under the provisions of Paragraph 26
below.

8.   Insurance; Indemnity.

     8.1 Payment for Insurance.  Lessee shall pay for all insurance required
under Paragraph 8. Premiums for policy periods commencing prior to or extending
beyond the Lease term shall be prorated to correspond to the Lease term. Payment
shall be made by Lessee to Lessor within ten (10) days following receipt of an
invoice.

     8.2 Liability Insurance.

         (a) Carried by Lessee. Lessee shall obtain and keep in force a
Commercial General Liability Policy of Insurance protecting Lessee and Lessor
against claims for bodily injury, personal injury and property damage based upon
or arising out of the ownership, use, occupancy or maintenance of the Premises
and all areas appurtenant thereto. Such insurance shall be on an occurence basis
providing single limit coverage in an amount not less than $2,000,000 per
occurence with an "Additional Insured-Managers or Lessors of Premises
Endorsement" and contain the "Amendment of the Pollution Exclusion Endorsement"
for damage caused by heat, smoke or fumes from a hostile fire. The Policy shall
not contain any intra-insured exclusions as between insured persons or
organizations, but shall include coverage for liability assumed under this Lease
as an  "insured contract" for the performance of Lessee's indemnity obligations
under this Lease. The limits of said insurance shall not, however, limit the
liability of Lessee nor relieve Lessee of any obligation hereunder.  All
insurance carried by Lessee shall be primary to and not contributory with any
similar insurance carried by Lessor, whose insurance shall be considered excess
insurance only.

     8.3    Property Insurance - Building, Improvements and Rental Value.

            (a) Building and Improvements. The Insuring Party shall obtain and
keep in force a policy or policies in the name of Lessor, with loss payable to
Lessor, any groundlessor, and to any Lender(s) insuring loss or damage to the
Premises. The amount of such insurance shall be equal to the full replacement
cost of the Premises, as the same shall exist from time to time, or the amount
required by any Lenders, but in no event more than the commercially reasonable
and available insurance value thereof. Lessee Owned Alterations and Utility
Installations, Trade Fixtures, and Lessee's personal property shall be insured
by Lessee under Paragraph 8.4. If the coverage is available and commercially
appropriate, such policy or policies shall insure against all risks of direct
physical loss or damage (except the perils of flood and/or earthquake unless
required by a Lender), including coverage for debris removal and the enforcement
of any Applicable Requirements requiring the upgrading, demolition,
reconstruction or replacement of any portion of the Premises as the result of a
covered loss. Said policy or policies shall also contain an agreed valuation
provision in lieu of any coinsurance clause, waiver of subrogation, and
inflation guard protection causing an increase in the annual property
insurance coverage amount by a factor of not less than the adjusted U.S.

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<PAGE>

Department of Labor Consumer Price Index for All Urban Consumers for the city
nearest to where the Premises are located. If such insurance coverage has a
deductible clause, the deductible amount shall not exceed $1,000 per occurrence,
and Lessee shall be liable for such deductible amount in the event of an
Insured Loss.

        (b) Rental Value. The Insuring Party shall obtain and keep in force a
policy or policies in the name of Lessor with loss payable to Lessor and any
Lender, insuring the loss of the full Rent for one (1) year. Said insurance
shall provide that in the event the Lease is terminated by reason of an insured
loss, the period of indemnity for such coverage shall be extended beyond the
date of the completion of repairs or replacement of the Premises, to provide for
one full year's loss of Rent from the date of any such loss. Said insurance
shall contain an agreed valuation provision in lieu of any coinsurance clause,
and the amount of coverage shall be adjusted annually to reflect the projected
Rent otherwise payable by Lessee, for the next twelve (12) month period.  Lessee
shall be liable for any deductible amount in the event of such loss.

        (c) Adjacent Premises. If the Premises are part of a larger building, or
of a group of buildings owned by Lessor which are adjacent to the Premises, the
Lessee shall pay for any increase in the premiums for the property insurance of
such building or buildings if said increase is caused by Lessee's acts,
omissions, use or occupancy of the Premises.

   8.4 Lessee's Property/Business Interruption Insurance.

        (a) Property Damage. Lessee shall obtain and maintain insurance coverage
on all of Lessee's personal property. Trade Fixtures, and Lessee Owned
Alterations and Utility Installations. Such insurance shall be full replacement
cost coverage with a deductible of not to exceed $1,000 per occurrence. The
proceeds from any such insurance shall be used by Lessee for the replacement of
personal property, Trade Fixtures and Lessee Owned Alterations and Utility
Installations. Lessee shall provide Lessor with written evidence that such
insurance is in force.

        (b) Business Interruption. Lessee shall obtain and maintain loss of
income and extra expense insurance in amounts as will reimburse Lessee for
direct or indirect loss of earnings attributable to all perils commonly insured
against by prudent lessees in the  business of Lessee or attributable to
prevention of access to the Premises as a result of such perils.

        (c) No Representation of Adequate Coverage. Lessor makes no
representation that the limits or forms of coverage of insurance specified
herein are adequate to cover Lessee's property, business operations or
obligations under this Lease.

    8.5 Insurance Policies. Insurance required herein shall be by companies duly
licensed or admitted to transact business in the state where the Premises are
located, and maintaining during the policy term a "General Policyholders Rating"
of at least 8+, V, as set forth in the most current issue of "Best's Insurance
Guide", or such other rating as may be required by a Lender. Lessee shall not do
or permit to be done anything which invalidates the required insurance policies.
Lessee shall, prior to the Start Date, deliver to Lessor certified copies of
policies of such insurance or certificates evidencing the existence and amounts
of the required insurance. No such policy shall be cancelable or subject to
modification except after thirty (30) days prior written notice to Lessor.
Lessee shall, at least thirty (30) days prior to the expiration of such
policies, furnish Lessor with evidence of renewals or "insurance binders"
evidencing renewal thereof, or Lessor may order such insurance and charge the
cost thereof to Lessee, which amount shall be payable to Lessee to Lessor upon
demand. Such policies shall be for a term of at least one year, or length of the
remaining term of this Lease, whichever is less. If either Party shall fail to
procure and maintain the insurance required to be carried by it, the other Party
may, but shall not be required to, procure and maintain the same.

    8.6 Waiver of Subrogation. Without affecting any other rights or remedies,
Lessee and Lessor  each hereby release and relieve the other, and waive their
entire right to recover damages against the other, for loss of or damage to its
property arising out of or incident to the perils required to be insured
against herein. The affect of such releases and waivers is not limited by the
amount of insurance carried or required, or by any deductibles applicable
hereto. The Parties agree to have their respective property damage insurance
carriers waive any right to subrogation that such companies may have against
Lessor or Lessee, as the case may be, so long as the insurance is not
invalidated thereby.

    8.7 Indemnity. Except for Lessor's gross negligence or willful misconduct,
Lessee shall indemnify, protect, defend and hold harmless the Premises, Lessor
and its agent, Lessor's master or ground lessor, partners and Lenders, from and
against any and all claims, loss of rents and/or damages, liens, judgments,
penalties, attorneys' and consultants' fees, expenses and/or liabilities
arising out of, involving, or in connection with, the sue and/or occupancy of
the Premises by Lessee. If any action or proceeding is brought against Lessor by
reason of any of the foregoing matters, Lessee shall upon notice defend the same
at Lessee's expense by counsel reasonably satisfactory to Lessor and Lessor
shall cooperate with Lessee in such defense. Lessor need not have first paid any
such claim in order to be defended or indemnified.

    8.8 Exemption of Lessor from Liability. Lessor shall not be liable for
injury or damage to the person or goods, wares, merchandise or other property of
Lessee, Lessee's employees, contractors, invitees, customers, or any other
person in or about the Premises, whether such damage or injury is caused by or
results from fire, steam, electricity, gas, water or rain, or from the breakage,
leakage, obstruction or other defects of pipes, fire sprinklers, wires,
appliances plumbing, HVAC or lighting fixtures, or from any other cause, whether
the said injury or damage results from conditions arising upon the Premises or
upon other portions of the Building of which the Premises are a part, or from
other sources or places. Lessor shall not be liable for any damages arising from
any act or neglect of any other tenant of Lessor. Notwithstanding Lessor's
negligence or breach of this Lease, Lessor shall under no circumstances be
liable for injury to Lessee's business or for any loss of income or profit
therefrom.

9.  Damage or Destruction.

    9.1 Definitions.

        (a) "Premises Partial Damage" shall mean damage or destruction to the
improvements on the Premises, other than Lessee Owned Alterations and Utility
Installations, which can reasonably be repaired in six (6) months or less from
the date of the damage or destruction at a cost of no more than $100,000.
Lessor shall notify Lessee in writing within thirty (30) days from the date of
the damage or destruction as to whether or not the damage is Partial or Total.

        (b) "Premises Total Destruction" shall mean damage or destruction to the
Premises, other than Lessee Owned Alterations and Utility Installations and
Trade Fixture, which cannot reasonably be repaired in six (6) months or less
from the date of the damage or destruction or which costs more than $100,000 to
repair. Lessor shall notify Lessee in writing within thirty (30) days from the
date of the damage or destruction as to whether or not the damage is Partial or
Total.

        (c) "Insured Loss" shall mean damage or destruction to improvements on
the Premises, other than Lessee Owned Alterations and Utility Installations and
Trade Fixtures, which was caused by an event required to be covered by the
insurance described in Paragraph 8.3(a), irrespective of any deductible amounts
or coverage limits involved.

        (d) "Replacement Cost" shall mean the cost to repair or rebuild the
improvements owned by Lessor at the time of the occurrence to their condition
existing immediately prior thereto, including demolition, debris removal and
upgrading required by the operation of Applicable Requirements, and without

                                 Page 6 of 15           Initials ______  ______
<PAGE>

deduction for depreciation.

                (e) "Hazardous Substance Condition" shall mean the occurrence or
discovery of a condition involving the presence of, or a contamination by, a
Hazardous Substance as defined in Paragraph 6.2(a), in, on, or under the
Premises.

        9.2     Partial Damage - Insured Loss. If a Premises Partial Damage that
is an Insured Loss occurs, then Lessor shall, but only to the extent of any
insurance proceeds, repair such damage (but not Lessee's Trade Fixtures or
Lessee Owned Alterations and Utility Installations) as soon as reasonably
possible and this Lease shall continue in full force and effect; provided,
however, that Lessee shall, at Lessor's election, make the repair of any damage
or destruction the total cost to repair of which is $10,000 or less, and, in
such event, Lessor shall make any applicable insurance proceeds available to
Lessee on a reasonable basis for that purpose. Notwithstanding the foregoing, if
the required insurance was not in force or the insurance proceeds are not
sufficient to effect such repair, the Insuring Party shall promptly contribute
the shortage in proceeds (except as to the deductible which is Lessee's
responsibility) as and when required to complete said repairs. In the event,
however, such shortage was due to the fact that, by reason of the unique nature
of the improvements, full replacement cost insurance coverage was not
commercially reasonable and available, Lessor shall have no obligation to pay
for the shortage in insurance proceeds or to fully restore the unique aspects of
the Premises unless Lessee provides Lessor with the funds to cover same, or
adequate assurance thereof, within ten (10) days following receipt of written
notice of such shortage and request therefor. If Lessor receives said funds or
adequate assurance thereof within said ten (10) day period, the party
responsible for making the repairs shall complete them as soon as reasonably
possible and this Lease shall remain in full force and effect. If such funds or
assurance are not received, Lessor may nevertheless elect by written notice to
Lessee within ten (10) days thereafter to: (i) make such restoration and repair
as is commercially reasonable with Lessee payee any shortage in proceeds, in
which case this Lease shall remain in full force and effect, or have this Lease
terminate thirty (30) days thereafter. Lessee shall not be entitled to
reimbursement of any funds contributed by Lessee to repair any such damage or
destruction. Premises Partial Damage due to flood or earthquake shall be subject
to Paragraph 9.3, notwithstanding that there may be some insurance coverage, but
the net proceeds of any such insurance shall be made available for the repairs
if made by either Party.

        9.3     Partial Damage - Uninsured Loss. If a Premises Partial Damage
that is not an Insured Loss occurs, unless caused by a negligent or willful act
of Lessor (in which event Lessor shall make the repairs at Lessor's expense).
Lessee shall repair such damage as soon as reasonably possible at Lessee's
expense and this Lease shall continue in full force and effect, but subject to
Lessor's rights under Paragraph 13.

        9.4     Total Destruction. Notwithstanding any other provision hereof,
if a Premises Total Destruction occurs, at the option of Lessor, this Lease
shall terminate sixty (60) days following such Destruction. If the damage or
destruction was caused by the gross negligence or willful misconduct of Lessee,
Lessor shall have the right to recover Lessor's damages from Lessee, except as
provided in Paragraph 8.6.

        9.5     Damage Near End of Term. If at any time during the last six (6)
months of this Lease there is damage for which the cost to repair exceeds one
(1) month's Base Rent, whether or not an insured Loss, Lessor may terminate this
Lease effective sixty (60) days following the date of occurrence of such damage
by giving a written termination notice to Lessee within the thirty (30) days
after the date of occurrence of such damage. Notwithstanding the foregoing, if
Lessee at that time has an exercisable option to extend this Lease or to
purchase the Premises, then Lessee may preserve this Lease by, (a) exercising
such option and (b) providing Lessor with any shortage in insurance proceeds (or
adequate assurance thereof) needed to make the repairs on or before the earlier
of (i) the date which is ten days after Lessee's receipt of Lessor's written
notice purporting to terminate this Lease, or (ii) the day prior to the date
upon which such option expires. If Lessee duly exercises such option during such
period and provides Lessor with funds (or adequate assurance thereof) to cover
any shortage in insurance proceeds, Lessor shall, at Lessor's commercially
reasonable expense, repair such damage as soon as reasonably possible and this
Lease shall continue in full force and effect. If Lessee fails to exercise such
option and provide such funds or assurance during such period, then this Lease
shall terminate on the date specified in the termination notice and Lessee's
option shall be extinguished.

        9.6     Abatement of Rent; Lessee's Remedies.

                (a) Abatement. In the event of Premises Partial Damage or
Premises Total Destruction or a Hazardous Substance Condition for which Lessee
is not responsible under this Lease, the Rent payable by Lessee for the period
required for the repair, remediation or restoration of such damage shall be
abated in proportion to the degree to which Lessee's use of the Premises is
impaired, but not to exceed the proceeds received from the Rental Value
insurance. All other obligations of Lessee hereunder shall be performed by
Lessee, and Lessor shall have no liability for any such damage, destruction,
remediation, repair or restoration except as provided herein.

                (b) Remedies. If Lessor shall be obligated to repair or restore
the Premises and does not commence, in a substantial and meaningful way, such
repair or restoration within ninety (90) days after such obligation shall
accrue, Lessee may, at any time prior to the commencement of such repair or
restoration, give written notice to Lessor and to any Lenders of which Lessee
has actual notice, of Lessee's election to terminate this Lease on a date not
less than sixty (60) days following the giving of such notice. If Lessee gives
such notice and such repair or restoration is not commenced within thirty (30)
days thereafter, this Lease shall terminate as of the date specified in said
notice. If the repair or restoration is commenced within said thirty (30) days,
this Lease shall continue in full force and effect. "Commence" shall mean either
the unconditional authorization of the preparation of the required plans, or the
beginning of the actual work on the Premises, whichever first occurs.

        9.7     Termination - Advance Payments. Upon termination of this Lease
pursuant to Paragraph 6.2(g) or Paragraph 9, an equitable adjustment shall be
made concerning advance Base Rent and any other advance payments made by Lessee
to Lessor. Lessor shall, in addition, return to Lessee so much of Lessee's
Security Deposit as has not been, or is not then required to be, used by Lessor.

        9.8     Waive Statutes. Lessor and Lessee agree that the terms of this
Lease shall govern the effect of any damage to or destruction of the Premises
with respect to the termination of this Lease and hereby waive the provisions of
any present or future statute to the extent inconsistent herewith.

10.     Real Property Taxes.

        10.1    Definition of "Real Property Taxes." As used herein, the term
"Real Property Taxes" shall include any form of assessment; real estate,
general, special, ordinary or extraordinary, or rental levy or tax (other than
inheritance, personal income or estate taxes); improvement bond; and/or license
fee

                                 Page 7 of 15
                                    REVISED             Initials _______ _______
<PAGE>

imposed upon or levied against any legal or equitable interest of Lessor in the
Premises, Lesssor's right to other income therefrom, and/or Lessor's business of
leasing, by any authority having the direct or indirect power to tax and where
the funds are generated with reference to the Building address and where the
proceeds so generated are to be applied by the city, county or other local
taxing authority of a jurisdiction within which the Premises are located. The
term "Real Property Taxes" shall also include any tax, fee, levy, assessment or
charge, or any increase therein, imposed by reason of events occurring during
the term of this Lease, including but not limited to, a change in the ownership
of the Premises.

   10.2

       (a) Payment of Taxes. Lessee shall pay the Real Property Taxes
applicable to the Premises during the term of this Lease. Subject to
Paragraph 10.2(b), all such payments shall be made at least ten (10) days prior
to any delinquency date. Lessee shall promptly furnish Lessor with satisfactory
evidence that such taxes have been paid. If any such taxes shall cover any
period of time prior to or after the expiration or termination of this Lease,
Lessee's share of such taxes shall be prorated to cover only that portion of the
tax bill applicable to the period that this Lease is in effect, and Lessor shall
reimburse Lessee for any overpayment. If Lessee shall fail to pay any required
Real Property Taxes, Lessor shall have the right to pay the same, and Lessee
shall reimburse Lessor therefor upon demand.

      (b)  Advance Payment. In the event Lessee incurs a late charge on any Rent
payment, Lessor may, at Lessor's option, estimate the current Real Property
Taxes, and require that such taxes be paid in advance to Lessor by Lessee,
either: (i) in a lump sum amount equal to the installment due, at least twenty
(20) days prior to the applicable delinquency date, or (ii) monthly in advance
with the payment of the Base Rent. If Lessor elects to require payment monthly
in advance, the monthly payment shall be an amount equal to the amount of the
estimated installment of taxes divided by the number of months remaining before
the month in which said installment becomes delinquent. When the actual amount
of the applicable tax bill is known, the amount of such equal monthly advance
payments shall be adjusted as required to provide the funds needed to pay the
applicable taxes. If the amount collected by Lessor is insufficient to pay such
Real Property Taxes when due, Lessee shall pay Lessor, upon demand, such
additional sums as are necessary to pay such obligations. All monies paid to
Lessor under this Paragraph may be intermingled with other monies of Lessor and
shall not bear interest. In the event of a Breach by Lessee in the performance
of its obligations under this Lease, then any balance of funds paid to Lessor
under the provisions of this Paragraph may, at the option of Lessor, be treated
as an additional Security Deposit.

   10.3  Joint Assessment. If the Premises are not separately assessed, Lessee's
liability shall be an equitable proportion of the Real Property Taxes for all of
the land and improvements included within the tax parcel assessed, such
proportion to be conclusively determined by Lessor from the respective
valuations assigned in the assessor's work sheets or such other information as
may be reasonably available.

   10.4  Personal Property Taxes. Lessee shall pay, prior to delinquency, all
taxes assessed against and levied upon Lessee Owned Alterations, Utility
installations, Trade Fixtures, furnishings, equipment and all personal property
of Lessee. When possible, Lessee shall cause such property to be assessed and
billed separately from the real property of Lessor. If any of Lessee's said
personal property shall be assessed with Lessor's real property, Lessee shall
pay Lessor the taxes attributable to Lessee's property within ten (10) days
after receipt of a written statement.

11.  Utilities. Lessee shall pay for all water, gas, heat, light, power,
telephone, trash disposal and other utilities and services supplied to the
Premises, together with any taxes thereon. If any such services are not
separately metered to Lessee, Lessee shall pay a reasonable proportion, to be
determined by Lessor, of all charges jointly metered.

12.  Assignment and Subletting.

   12.1 Lessor's Consent Required.

        (a) Lessee shall not voluntarily or by operation of law assign,
transfer, mortgage or encumber (collectively, "assign or assignment") or sublet
all or any part of Lessee's interest in this Lease or in the Premises without
Lessor's prior written consent, which consent shall not be unreasonably
withheld.

        (b) A change in the control of Lessee shall constitute an assignment
requiring consent. The transfer, on a cumulative basis, of (50)% or more of the
voting control of Lessee shall constitute a change in control for this purpose.
This Paragraph 12.1(b) shall not apply if the shares of Lessee are owned by 50
or more persons.

        (c) The involvement of Lessee or this assets in any transaction, or
series of transactions (by way of merger, sale, acquisition, financing,
transfer, leverage buy-out or otherwise), whether or not a formal assignment or
hypothecation of this Lease or Lessee's assets occurs, which results or will
result in a reduction of the Net Worth of Lessee (or the restructured entity) by
an amount greater than twenty-five percent (25%) of such Net Worth as it was
represented at the time of the execution of this Lease or at the time of the
most recent assignment to which Lessor has consented, or as it exists
immediately prior to said transaction or transactions constituting such
reduction, whichever was or is greater, shall be considered an assignment of
this Lease to which Lessor may withhold its consent. "Net Worth of Lessee" shall
mean the net worth of Lessee (excluding any guarantors) established under
generally accepted accounting principles. This Paragraph 12.1(c) shall not apply
if the shares of Lessee are owned by 50 or more persons.

        (d) An assignment or subletting without consent shall, at Lessor's
option, be a default curable after notice per Paragraph 13.1(c), or a noncurable
Breach without the necessity of any notice and grace period. If Lessor elects to
treat such unapproved assignment or subletting as a noncurable Breach, Lessor
may either; (i) terminate this Lease, or (ii) upon thirty (30) days written
notice, increase the monthly Base Rent to one hundred ten percent (110%) of the
Base Rent then in effect. Further, in the event of such Breach and rental
adjustment, (i) the purchase price of any option to purchase the Premises held
by Lessee shall be subject to similar adjustment to one hundred ten percent
(110%) of the price previously in effect, and (ii) all fixed and non-fixed
rental adjustments scheduled during the remainder of the Lease term shall be
increased to One Hundred Ten Percent (110%) of the scheduled adjusted rent.

        (e) Lessee's remedy for any breach of Paragraph 12.1 by Lessor shall be
limited to compensatory damages and/or injunctive relief.

   12.2 Terms and Conditions Applicable to Assignment and Subletting.

        (a) Regardless of Lessor's consent, any assignment or subletting shall
not: (i) be effective without the express written assumption by such assignee or
sublessee of the obligations of Lessee under this Lease; (ii) release Lessee of
any obligations hereunder, or (iii) after the primary liability of Lessee for
the payment of Rent or for the performance of any other obligations to be
performed by Lessee.

        (b) Lessor may accept Rent or performance of Lessee's obligations from
any person other than Lessee pending approval or disapproval of an assignment.
Neither a delay in the approval or disapproval of such assignment nor the
acceptance of Rent or performance shall constitute a waiver or estoppel of
Lessor's right to exercise its remedies for Lessee's Default or Breach.

        (c) Lessor's consent to any assignment or subletting shall not
constitute a consent to any subsequent assignment or subletting.

        (d) In the event of any Default or Breach by Lessee, Lessor may proceed
directly against Lessee, any Guarantors or anyone else responsible for the
performance of Lessee's obligations under this Lease, including any assignee or
sublessee, without first exhausting Lessor's remedies against any other person

                              Page 8 of 15                  Initials
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<PAGE>

or entity responsible therefore to Lessor, or any security held by Lessor.

          (e) Each request for consent to an assignment or subletting shall be
in writing, accompanied by information relevant to Lessor's determination as to
the financial and operational responsibility and appropriateness of the proposed
assignee or sublessee, including but not limited to the intended use and/or
required modification of the Premises, if any, together with a fee of $1,000 or
ten percent (10%) of the current monthly Base Rent applicable to the portion of
the Premises which is the subject of the proposed assignment or sublease,
whichever is greater, as consideration for Lessor's considering and processing
said request. Lessee agrees to provide Lessor with such other or additional
information and/or documentation as may be reasonably requested.

          (f) Any assignee of, or sublessee under, this Lease shall, by reason
of accepting such assignment or entering into such sublease, be deemed to have
assumed and agreed to conform and comply with each and every term, covenant,
condition and obligation herein to be observed or performed by Lessee during the
term of said assignment or sublease, other than such obligations as are contrary
to or inconsistent with provisions of an assignment or sublease to which Lessor
has specifically consented to in writing.

    12.3  Additional Terms and Conditions Applicable to Subletting. The
following terms and conditions shall apply to any subletting by Lessee of all or
any part of the Premises and shall be deemed included in all subleases under
this Lease whether or not expressly incorporated therein;

          (a) Lessee hereby assigns and transfers to Lessor all of Lessee's
interest in all Rent payable on any sublease, and Lessor may collect such Rent
and apply same toward Lessee's obligations under this Lease; provided, however,
that until a Breach shall occur in the performance of Lessee's obligations,
Lessee may collect said Rent. Lessor shall not, by reason of the foregoing or
any assignment of such sublease, nor by reason of the collection of Rent, be
deemed liable to the sublessee for any failure of Lessee to perform and comply
with any of Lessee's obligations to such sublessee. Lessee herby irrevocably
authorizes and directs any such sublessee, upon receipt of a written notice from
Lessor stating that a Breach exists in the performance of Lessee's obligations
under this Lease, to pay to Lessor all Rent due and to become due under the
sublease. Sublessee shall rely upon any such notice from Lessor and shall pay
all Rents to Lessor without any obligation or right to inquire as to whether
such Breach exists, notwithstanding any claim from Lessee to the contrary.

          (b) In the event of a Breach by Lessee, Lessor may, at its option,
require sublessee to attorn to Lessor, in which event Lessor shall undertake
the obligations of the sublessor under such sublease from the time of the
exercise of said option to the expiration of such sublease; provided, however,
Lessor shall not be liable for any prepaid rents or security deposit paid by
such sublessee to such sublessor or for any prior Defaults or Breaches of such
sublessor.

          (c) Any matter requiring the consent of the sublessor under a sublease
shall also require the consent of Lessor.

          (d) No sublessee shall further assign or sublet all or any part of the
Premises without Lessor's prior written consent.

          (e) Lessor shall deliver a copy of any notice of Default or Breach by
Lessee to the sublessee, who shall have the right to cure the Default of Lessee
within the grace period, if any, specified in such notice.  The sublessee shall
have a right of reimbursement and offset from and against Lessee for any such
Defaults cured by the sublessee.

13. Default; Breach; Remedies.

    13.1  Default; Breach. A "Default" is defined as a failure by the Lessee to
comply with or perform any of the terms, covenants, conditions or rules under
this Lease. A "Breach" is defined as the occurrence of one or more of the
following Defaults, and the failure of Lessee to cure such Default within any
applicable grace period:

          (a) The abandonment of the Premises; or the vacating of the Premises
without providing a commercially reasonable level of security, or where the
coverage of the property insurance described in Paragraph 8.3 is jeopardized as
a result thereof, or without providing reasonable assurances to minimize
potential vandalism.

          (b) The failure of Lessee to make any payment of Rent or any Security
Deposit required to be made by Lessee hereunder, whether to Lessor or to a third
party, when due, to provide reasonable evidence of insurance or surety bond, or
to fulfill any obligation under this Lease which endangers or threatens life or
property, where such failure continues for a period of three (3) business days
following written notice to Lessee.

          (c) The failure by Lessee to provide (i) reasonable written evidence
of compliance with Applicable Requirements, (ii) the service contracts, (iii)
the rescission of an unauthorized assignment or subletting, (iv) a Tenancy
Statement, (v) a requested subordination, (vi) any document requested under
Paragraph 42 (easements), or (vii) any other documentation or information which
Lessor may reasonably require of Lessee under the terms of this Lease, where any
such failure continues for a period of ten (10) days following written notice to
Lessee.

          (d) A Default by Lessee as to the terms, covenants, conditions or
provisions of this Lease, or of the rules adopted under Paragraph 40 hereof,
other than those described in subparagraphs 13.1(a),(b) or (c), above, where
such Default continues for a period of thirty (30) days after written notice;
provided, however, that if the nature of Lessee's Default is such that more than
thirty (30) days are reasonably required for its cure, then it shall not be
deemed to be a Breach if Lessee commences such cure within said thirty (30) day
period and thereafter diligently prosecutes such cure to completion.

          (e) The occurrence of any of the following events; (i) the making of
any general arrangement or assignment for the benefit of creditors; (ii)
becoming a "debtor" as defined in 11 U.S.C (S) 101 or any successor statute
thereto (unless, in the case of a petition filed against Lessee, the same is
dismissed within sixty (60) days); (iii) the appointment of a trustee or
receiver to take possession of substantially all of Lessee's assets located at
the Premises or of Lessee's interest in this Lease, where possession is not
restored to Lessee within thirty (30) days; or (iv) the attachment, execution or
other judicial seizure of substantially all of Lessee's assets located at the
Premises or of Lessee's interest in this Lease, where such seizure is not
discharged within thirty (30) days; provided, however, in the event that any
provision of this subparagraph 13.1 (e) is contrary to any applicable law, such
provision shall be of no force or effect, and not affect the validity of the
remaining provisions.

          (f) The discovery that any financial statement of Lessee given to
Lessor was materially false.

    13.2 Remedies. If Lessee fails to perform any of its affirmative duties or
obligations, within ten (10) days after written notice (or in case of an
emergency, without notice), Lessor may, at its option, perform such duty or
obligation on Lessee's behalf, including but not limited to the obtaining of
reasonably required bonds, insurance policies, or governmental licenses, permits
or approvals. The costs and expenses of any such performance by Lessor shall be
due and payable by Lessee upon receipt of invoice therefor. If any check given
to Lessor by Lessee shall not be honored by the bank upon which it is drawn,
Lessor, at its option, may require all future payments to be made by Lessee to
be by cashier's check. In the event of a Breach, Lessor may, with or without
further notice or demand, and without limiting Lessor in the exercise of any
right or remedy which Lessor may have by reason of such Breach:

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           (a) Terminate Lessee's right to possession of the Premises by any
lawful means, in which case this Lease shall terminate and Lessee shall
immediately surrender possession to Lessor. In such event, Lessor shall be
entitled to recover from Lessee: (i) the unpaid Rent which had been named at the
time of termination; (ii) the worth at the time of award of the amount by which
the unpaid rent which would have been earned after termination until the time of
award exceeds the amount of such rental loss that the Lessee proves could have
been reasonably avoided; (iii) the worth at the time of award of the amount by
which the unpaid rent for the balance of the term after the time of award
exceeds the amount of such rental loss that the Lessee proves could be
reasonably avoided; and (iv) any other amount necessary to compensate Lessor for
all the detriment proximately caused by the Lessee's failure to perform its
obligations under this Lease or which in the ordinary course of things would be
likely to result therefrom, including but not limited to the cost of recovering
possession of the Premises, expenses of reletting including necessary renovation
and alteration of the Premises, reasonable attorneys' fees, and that portion of
any leasing commission paid by Lessor in connection with this Lease applicable
to the unexpired term of this Lease. The worth at the time of award of the
amount referred to in provision (iii) of the immediately preceding sentence
shall be computed by discounting such amount at the discount rate of the Federal
Reserve Bank of the District within which the Premises are located at the time
of award plus one percent (1%). Efforts by Lessor to mitigate damages caused by
Lessee's Breach of this Lease shall not waive Lessor's right to recover damages
under Paragraph 12. If termination of this Lease is obtained through the
provisional remedy of unlawful detainer, Lessor shall have the right to recover
in such proceeding any unpaid Rent and damages as are recoverable therein, or
Lessor may reserve the right to recover all or any part thereof in a separate
suit. If a notice and grace period required under Paragraph 13.1 was not
previously given, a notice to pay rent or quit, or to perform or quit given to
Lessee under the unlawful detainer statute shall also constitute the notice
required by Paragraph 13.1. In such case, the applicable grace period required
by Paragraph 13.1 and the unlawful detainer statute shall run concurrently, and
the failure of Lessee to cure the Default within the greater of the two such
grace periods shall constitute both an unlawful detainer and a Breach of this
Lease entitling Lessor to remedies provided for in this Lease and/or by said
statute.
           (b) Continue the Lease and Lessee's right to possession and recover
the Rent as it becomes due, in which event Lessee may sublet or assign,
subject only to reasonable limitations. Acts of maintenance, efforts to relet,
and/or the appointment of a receiver to protect the Lessor's interests, shall
not constitute a termination of the Lessee's right to possession.
           (c) Pursue any other remedy now or hereafter available under the laws
or judicial decisions of the state wherein the Premises are located. The
expiration or termination of the Lease and/or the termination of Lessee's right
to possession shall not relieve Lessee from liability under any indemnity
provisions of this Lease as to matters occurring or accruing during the term
hereof or by reason of Lessee's occupancy of the Premises.
     13.4  Late Charges. Lessee hereby acknowledges that late payment by Lessee
of Rent will cause the Lessor to incur costs not contemplated by this Lease, the
exact amount of which will be extremely difficult to ascertain. Such costs
include, but are not limited to, processing and accounting charges, and late
charges which may be imposed upon Lessor by any Lender. Accordingly, if any Rent
shall not be received by Lessor within five (5) days after such amount shall
be due, then, without any requirement for notice to Lessee, Lessee shall pay to
Lessor a one-time late charge equal to ten percent (10%) of each such overdue
amount. The Parties hereby agree that such late charge represents a fair and
reasonable estimate of the costs Lessor will incur by reason of such late
payment. Acceptance of such late charge by Lessor shall in no event constitute a
waiver of Lessee's Default or Breach with respect to such overdue amount, nor
prevent the exercise of any of the other rights and remedies granted hereunder.
In the event that a late charge is payable hereunder, whether or not collected,
for three (3) consecutive installments of Base Rent, then notwithstanding any
provision of this Lease to the contrary, Base Rent shall, at Lessor's option,
become due and payable quarterly in advance.
     13.5  Interest. Any monetary payment due Lessor hereunder, other than late
charges, not received by Lessor, when due as to scheduled payments (such as Base
Rent) or within thirty (30) days following the date on which it was due for non-
scheduled payment, shall bear interest from the date when due, as to scheduled
payments, or the thirty-first (31st) day after it was due as to non-scheduled
payments. The interest ("Interest") charged shall be equal to the prime rate
reported in the Wall Street Journal as published closest prior to the date when
due plus four percent (4%), but shall not exceed the maximum rate allowed by
law. Interest is payable in addition to the potential late charge provided for
in Paragraph 13.4.
     13.6  Breach by Lessor.
           (a) Notice of Breach. Lessor shall not be deemed in breach of this
Lease unless Lessor fails within a reasonable time to perform an obligation
required to be performed by Lessor. For purposes of this Paragraph, a reasonable
time shall in no event be less than thirty (30) days after receipt by Lessor,
and any Lender whose name and address shall have been furnished Lessee in
writing for such purpose, of written notice specifying wherein such obligation
of Lessor has not been performed; provided, however, that if the nature of
Lessor's obligation is such that more than thirty (30) days are reasonably
required for its performance, then Lessor shall not be in breach if performance
is commenced within such thirty (30) day period and thereafter diligently
pursued to completion.
           (b) Performance of Lessee on Behalf of Lessor. In the event that
neither Lessor nor Lender cures said breach within thirty (30) days after
receipt of said notice, or if having commenced said cure they do not diligently
pursue it to completion, the Lessee may elect to cure said breach at Lessee's
expense and offset from Rent an amount equal to the greater of one month's Base
Rent or the Security Deposit, and to pay an excess of such expense under
protest, reserving Lessee's right to reimbursement from Lessor, Lessee shall
document the cost of said cure and supply said documentation to Lessor.
14.  Condemnation. If the Premises or any portion thereof are taken under the
power of eminent domain or sold under the threat of the exercise of said power
(collectively "Condemnation"), the Lease shall terminate as to the part taken as
of the date the condemning authority takes title or possession, whichever first
occurs. If more than ten percent (10%) of any building portion of the Premises,
or more than twenty-five percent (25%) of the land area portion of the Premises
not occupied by any building, is taken by Condemnation, Lessee may, at Lessee's
option, to be exercised in writing within ten (10) days after Lessor shall have
given Lessee written notice of such taking (or in the absence of such notice,
within ten (10) days after condemning authority shall have taken possession)
terminate this Lease as of the date the condemning authority takes such
possession. If Lessee does not terminate this Lease in accordance with the
foregoing, this Lease shall remain in full force and effect as to the portion of
the Premises remaining, except that the Base Rent shall be reduced in proportion
to the reduction in utility of the Premises caused by such Condemnation.
Condemnation awards and/or payments shall be the property of Lessor, whether
such award shall be made as compensation for diminution in value of the
leasehold, the value of the part taken, or for severance damages; provided,
however, that Lessee shall be entitled to any
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compensation for Lessee's relocation expenses, loss of business goodwill and/or
Trade Fixtures, without regard to whether or not this Lease is terminated
pursuant to the provisions of this Paragraph. All Alterations and Utility
Installations made to the Premises by Lessee, for purposes of Condemnation only,
shall be considered the property of the Lessee and Lessee shall be entitled to
any and all compensation which is payable therefor. In the event that this Lease
is not terminated by reason of the Condemnation, Lessor shall repair any damage
to the Premises caused by such Condemnation.
15.  Brokers' Fee. None. See Addendum (P)52.
16.  Estoppel Certificates.
         (a) Each Party (as "Responding Party") shall within ten (10) days after
written notice from the other Party (the "Requesting Party") execute,
acknowledge and deliver to the Requesting Party a statement in writing in form
similar to the then most current "Estoppel Certificate" form published by the
American Industrial Real Estate Association, plus such additional information,
confirmation and/or statements as may be reasonably requested by the Requesting
Party.
         (b) If the Responding Party shall fail to execute or deliver the
Estoppel Certificate within such ten day period, the Requesting Party may
execute an Estoppel Certificate stating that: (i) the Lease is in full force and
effect without modification except as may be represented by the Requesting
Party, (ii) there are no uncured defaults in the Requesting Party's performance,
and (iii) if Lessor is the Requesting Party, not more than one month's Rent has
been paid in advance. Prospective purchasers and encumbrancers may rely upon the
Requesting Party's Estoppel Certificate, and the Responding Party shall be
estopped from denying the truth of the facts contained in said Certificate.
         (c) If Lessor desires to finance, refinance, or sell the Premises, or
any part thereof, Lessee and all Guarantors shall deliver to any potential
lender or purchaser designated by Lessor such financial statements as may be
reasonably required by such lender of purchaser, including, but not limited to,
Lessee's financial statements for the past three (3) years. All such financial
statements shall be received by Lessor and such lender or purchaser in
confidence and shall be used only for the purposes herein set forth.
17.  Definition of Lessor. The term "Lessor" as used herein shall mean the owner
or owners at the time in question of the fee title to the Premises, or, if this
is a sublease, of the Lessee's interest in the prior lease. In the event of a
transfer of Lessor's title or interest in the Premises or this Lease, Lessor
shall deliver to the transferee or assignee (in cash or by credit) any unused
Security Deposit held by Lessor. Except as provided in Paragraph 15, upon such
transfer or assignment and delivery of the Security Deposit, as aforesaid, the
prior Lessor shall be relieved of all liability with respect to the obligations
and/or covenants under this Lease thereafter to be performed by the Lessor.
Subject to the foregoing, the obligations and/or covenants in this Lease to be
performed by the Lessor shall be binding only upon the Lessor as hereinabove
defined. Notwithstanding the above, and subject to the provisions of Paragraph
20 below, the original Lessor under this Lease, and all subsequent holders of
the Lessor's interest in this Lease shall remain liable and responsible with
regard to the potential duties and liabilities of Lessor pertaining to Hazardous
Substances as outlined in Paragraph 6 above.
18.  Severability. The invalidity of any provision of this Lease, as determined
by a court of competent jurisdiction, shall in no way affect the validity of
any other provision hereof.
19.  Days. Unless otherwise specifically indicated to the contrary, the word
"days" as used in this Lease shall mean and refer to calendar days.
20.  Limitation on Liability. Subject to the provisions of Paragraph 17 above,
the obligations of Lessor under this Lease shall not constitute personal
obligations of Lessor, the individual partners of Lessor or its or their
individual partners, directors, officers or shareholders, and Lessee shall look
to the Premises, and to no other assets of Lessor, for the satisfaction of
any liability of Lessor with respect to this Lease, and shall not seek recourse
against the individual partners of Lessor, or its or their individual partners,
directors, officers or shareholders, or any of their personal assets for such
satisfaction.
21.  Time of Essence. Time is of the essence with respect to the performance of
all obligations to be performed or observed by the Parties under this Lease.
22.  No Prior or Other Agreements. This Lease contains all agreements between
the Parties with respect to an matter mentioned herein, and no other prior or
contemporaneous agreement or understanding shall be effective. Lessor and
Lessee each represents and warrants to the Brokers that it has made, and is
relying solely upon, its own investigation as to the nature, quality, character
and financial responsibility of the other Party to this Lease and as to the
nature, quality and character of the Premises.
23.  Notices.
     23.1 Notice Requirements. All notices required or permitted by this Lease
shall be in writing and may be delivered in person (by hand or by courier) or
may be sent by regular, certified or registered mail or U.S. Postal Service
Express Mail, with postage prepaid, or by facsimile transmission, and shall be
deemed sufficiently given if served in a manner specified in this Paragraph 23.
The addresses noted adjacent to a Party's signature on this Lease shall be that
Party's address for delivery or mailing of notices. Either Party  may by written
notice to the other specify a different address for notice, except that upon
Lessee's taking
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possession of the Premises, the Premises shall constitute Lessee's address for
notice. A copy of all notices to Lessor shall be concurrently transmitted to
such party or parties at such addresses as Lessor may from time to time
hereafter designate in writing.
     23.2 Date of Notice. Any notice sent by registered or certified mail,
return receipt requested, shall be deemed given on the date of delivery shown on
the receipt card, or if no delivery date is shown, the postmark thereon. If sent
by regular mail the notice shall be deemed given forty-eight (48) hours after
the same is addressed as required herein and mailed with postage prepaid.
Notices delivered by United States Express Mail or overnight courier that
guarantee next day delivery shall be deemed given twenty-four (24) hours after
delivery of the same to the Postal Service or courier. Notices transmitted by
facsimile transmission or similar means shall be deemed delivered upon telephone
confirmation of receipt. provided a copy is also delivered via delivery or mail.
If notice is received on a Saturday, Sunday or legal holiday, it shall be deemed
received on the next business day.
24.  Waivers. No waiver by Lessor of the Default or Breach of any term, covenant
or condition hereof by Lessee, shall be deemed a waiver of any other term
covenant or condition hereof, or of any subsequent Default or Breach by Lessee
of the same or of any other term, covenant or condition hereof. Lessor's consent
to or approval of, any act shall not be deemed to render unnecessary the
obtaining of Lessor's consent to, or approval of, any subsequent or similar act
by Lessee, or be construed as the basis of an estoppel to enforce the provision
of provisions of this Lease requiring such consent. The acceptance of Rent by
Lessor shall not be a waiver of any Default or Breach of Lessee. Any payment by
Lessee may be accepted by Lessor on account of monies of damages due Lessor,
notwithstanding any qualifying statements or conditions made by Lessee in
connection therewith, which such statements and/or conditions shall be of no
force or effect whatsoever unless specifically agreed to in writing by Lessor at
or before the time of deposit of such payment.
25.  Recording. Either Lessor Lessee shall, upon request of the other,
execute, acknowledge and deliver to the other a short form memorandum of this
Lease for recording purposes. The Party requesting recordation shall be
responsible for payment of any fees applicable thereto.
26.  No Right to Holdover. Lessee has no right to retain possession of the
Premises or any part thereof beyond the expiration or termination of this Lease.
In the event that Lessee holds over, then the Base Rent shall be increased to
one hundred fifty  percent (150%) of the Base Rent applicable during the month
immediately preceding the expiration or termination. Nothing contained herein
shall be construed as consent by Lessor to any holding over by Lessee.
27.  Cumulative Remedies. No remedy or election hereunder shall be deemed
exclusive but shall, wherever possible, be cumulative with all other remedies
at law or in equity.
28.  Covenants and Conditions; Construction of Agreement. All provisions of this
Lease to be observed or performed by Lessee are both covenants and conditions.
In constructing this Lease, all headings and titles are for the convenience of
the Parties only and shall not be considered a part of this Lease. Whenever
required by the context, the singular shall include the plural and vice versa.
This lease shall not be construed as if prepared by one of the Parties, but
rather according to its fair meaning as a whole, as if both Parties had prepared
it.
29.  Binding Effect; Choice of Law. This Lease shall be binding upon the
Parties, their personal representatives, successors and assigns and be governed
by the laws of the State in which the Premises are located. Any litigation
between the Parties hereto concerning this Lease shall be initiated in the
county in which the Premises are located.
30.  Subordination; Attornment; Non-Disturbance.
     30.1  Subordination. This Lease and any Options granted hereby shall be
subject and subordinate to any ground lease, mortgage, deed of trust, or other
hypothecation or security device (collectively, "Security Device"), now or
hereafter placed upon the Premises, to any and all advances made on the security
thereof, and to all renewals, modifications, and extensions thereof. Lessees
agrees that the holders of any such Security Devices (in this Lease together
referred to as "Lessor's Lender") shall have no liability or obligation to
perform any of the obligations of Lessor under this Lease. Any Lender may elect
to have this Lease and/or any Option granted hereby superior to the lien of its
Security Device by giving written notice thereof to Lessee, whereupon this Lease
and such Options shall be deemed prior to such Security Device, notwithstanding
the relative date of the documentation or recordation thereof.
     30.2  Attornment. Subject to the non-disturbance provisions of Paragraph
30.3, Lessee agrees to attorn to a Lender or any other party who acquires
ownership of the Premises by reason of a foreclosure of a Security Device, and
for any act or omission or any prior lessor or with respect to the events
occurring prior to the acquisition of ownership; (ii) be subject to any offsets
of defenses which Lessee might have against any prior lessor; of (iii) be bound
by prepayment of more than one (1) month's rent.
     30.3 Non-Disturbance. With respect to Security Devices entered into by
Lessor and after the execution of this Lease, Lessee's subordination of this
Lease shall be subject to receiving a commercially reasonable non-disturbance
agreement (a "Non-Disturbance Agreement") from the Lender which Non-Disturbance
Agreement provides that Lessee's possession of the Premises, and this Lease,
including any options to extend the term hereof, will not be disturbed so long
as Lessee  is not in Breach hereof and attorns to the record owner of the
Premises. Further, within sixty days (60) after the execution of this Lease,
Lessor shall use its commercially reasonable efforts to obtain a Non-Disturbance
Agreement from the holder of any pre-existing Security Device which is secured
by the Premises. In the event that the Lessor is unable to provide the Non-
Disturbance Agreement within sixty (60) days, then Lessee may, at Lessee's
option directly contact Lessor's lender and attempt to negotiate for the
execution and delivery of a Non-Disturbance Agreement.
     30.4  Self-Executing. The agreements contained in this Paragraph 30 shall
be effective without the execution of any further documents; provided, however,
that, upon written request from Lessor or a Lender in connection with a sale,
financing or refinancing of the Premises, Lessee and Lessor shall execute such
further writings as may be reasonably required to separately document any
subordination, attornment and/or Non-Disturbance Agreement provided for herein.
31.  Attorneys Fees. If any Party brings an action or proceeding involving the
Premises to enforce the terms hereof or to declare rights hereunder, the
Prevailing Party (as hereafter defined) in any such proceeding, action or appeal
thereon, shall be entitled to reasonable attorneys' fees. Such fees may be
awarded in the same suit or recovered in a separate suit, whether or not such
action or proceeding is pursued to decision or judgment. The term, "Prevailing
Party" shall include, without limitation, a Party who substantially obtains or
defeats the relief sought, as the case may be, whether by compromise,
settlement, judgement, or the abandonment by the other Party of its claim of
defenses. The attorneys' fees shall not be computed in accordance with any
court fee schedule, but shall be such as to fully reimburse all attorneys' fees
reasonably incurred. In addition, Lessor shall be entitled to attorneys' fees,
costs and expenses incurred in the preparation and service of notices of Default
and consultations in connection therewith, whether or not a legal action is
subsequently commenced in connection with such Default or resulting Breach.
32.  Lessor's Access; Showing Premises; Repairs. Lessor and Lessee's agents
shall have the right to enter the Premises at any time, in the case of an
emergency, and otherwise at reasonable times for the purpose of showing the same
to prospective purchasers, lenders, or lessees, and making such alterations,
repairs, improvements or additions to the Premises as Lessor may deem necessary.
All such activities shall be without abatement of rent or liability to Lessee.
Lessor may at any time place on the Premises any ordinary "For Sale" signs and
Lessor may during the last six (6) months of the term hereof place on the
Premises any ordinary "For Lease" signs. Lessee may at any time place on or
about the Premises any ordinary "For Sublease" sign.
33.  Auctions. Lessee shall not conduct, nor permit to be conducted, any auction
upon the Premises without the Lessor's prior written consent. Lessor shall not
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be obligated to exercise any standard of reasonableness in determining whether
to permit an auction.
34.  Signs. Except for ordinary "For Sublease" signs, Lessee shall not place any
sign upon the Premises with Lessor's prior written consent. All signs must
comply with all Applicable Requirements.
35.  Termination; Merger. Unless specifically stated otherwise in writing by
Lessor, the voluntary or other surrender of this Lease by Lessee, the mutual
termination or cancellation hereof, or a termination hereof by Lessor for Breach
by Lessee, shall automatically terminate any sublease or lesser estate in the
Premises; provided, however, that Lessor may elect to continue any one or all
existing subtenancies. Lessor's failure within ten (10) days following any such
event to elect to the contrary by written notice to the holder of any such
lesser interest, shall constitute Lessor's election to have such event
constitute the termination of such interest.
36.  Consents. Except as otherwise provided herein, wherever in this Lease the
consent of a party is required to an act by or for the other Party, such consent
shall not be unreasonably withheld or delayed. Lessor's actual reasonable costs
and expenses (including, but not limited to, architects', attorneys', engineers'
and other consultants' fees) incurred in the consideration of, or response to, a
request by Lessee for any Lessor consent, including, but not limited to,
consents to an assignment, a subletting or the presence or use of a Hazardous
Substance, shall be paid by Lessee upon receipt of an invoice and supporting
documentation therefor. Lessor's consent to any act, assignment or subletting
shall not constitute an acknowledgement that no Default or Breach by Lessee of
this Lease exists, nor shall such consent be deemed a waiver of any then
existing Default or Breach, except as may be otherwise specifically stated in
writing by Lessor at the time of such consent. The failure to specify herein any
particular condition to Lessor's consent shall not preclude the imposition by
Lessor at the time of consent of such further or other conditions as are then
reasonable with reference to the particular matter for which consent is being
given. In the event that either Party disagrees with any determination made by
the other hereunder and reasonably requests the reasons for such determination,
the determining party shall furnish its reasons in writing and in reasonable
detail within ten (10) business days following such request.
38.  Quiet Possession. Subject to payment by Lessee of the Rent and performance
of all of the covenants, conditions and provisions on Lessee's part to by
observed and performed under this Lease, Lessee shall have quiet possession and
quiet enjoyment of the Premises during the term hereof.
39.  Options. See Addendum (P)53.
     39.1  Definition. "Option" shall mean: (a) the right to extend the term of
this Lease.
     39.3  Multiple Options. In the event that Lessee has any multiple Options
to extend or renew this Lease, a later Option cannot be exercised unless the
prior Options have been validly exercised.
     39.4  Effect of Default on Options.
           (a) Lessee shall have no right to exercise an Option: (i) during the
period commencing with the giving of any notice of Default and continuing until
said Default is cured, (ii) during the period of time any Rent is unpaid
(without regard to whether notice thereof is given Lessee), (iii) during the
time Lessee is in Breach of this Lease, or (iv) in the event that Lessee has
been given three (3) or more notices of separate Default, whether or not the
Defaults are cured, during the twelve (12) month period immediately preceding
the exercise of the Option.
           (b) The period of time within which an Option may be exercised shall
not be extended or enlarged by reason of Lessee's inability to exercise an
Option because of the provisions of Paragraph 39.4(a).
           (c) An Option shall terminate and be of no further force or effect,
notwithstanding Lessee's due and timely exercise of the Option, if, after such
exercise and prior to the commencement of the extended term, (i) Lessee fails to
pay Rent for a period of thirty (30) days after such Rent becomes due (without
any necessity of Lessor to give notice thereof), (ii) Lessor gives to Lessee
three (3) or more notices of separate Default during any twelve (12) month
period, whether or not the Defaults are cured, or (iii) if Lessee commits a
Breach of this Lease.
40.  Multiple Buildings. If the Premises are a part of a group of buildings
controlled by Lessor, Lessee agrees that it will observe all reasonable rules
and regulations which Lessor may make from time to time for the management,
safety, and care of said properties, including the care and cleanliness of the
grounds and including the parking, loading and unloading of vehicles, and that
Lessee will pay its fair share of common expenses incurred in connection
therewith.
41.  Security Measures. Lessee hereby acknowledges that the rental payable to
Lessor hereunder does not include the cost of guard service or other security
measures, and that Lessor shall have no obligation whatsoever to provide same.
Lessee assumes all responsibility for the protection of the Premises, Lessee,
its agents and invitees and their property from the acts of third parties.
42.  Reservations. Lessor reserves to itself the right, from time to time, to
grant, without the consent or joinder of Lessee, such easements, rights and
indications that Lessor deems necessary, and to cause the recordation of parcel
maps and restrictions, so long as such easements, rights, dedications, maps and
restrictions do not unreasonable interfere with the use of the Premises by
Lessee. Lessee agrees to sign any documents reasonable requested by Lessor to
effectuate any such easement rights, dedication, map or restrictions.
43.  Performance Under Protest. If at any time a dispute shall arise as to any
amount or sum of money to be paid by one Party to the other under the provisions
hereof, the Party against whom the obligation to pay the money is asserted shall
have the right to may payment "under protest" and such payment shall not be
regarded as a voluntary payment and there shall survive the right on the part of
said Party to institute suit for recovery of such sum. If it shall be adjudged
that there was no legal obligation on the part of said Party to pay such sum or
any part thereof, said Party shall be entitled to recover such sum or so much
thereof as it was not legally required to pay.
44.  Authority. If either Party hereto is a corporation, trust, limited
liability company, partnership, or similar entity, each individual executing
this Lease on behalf of such entity represents and warrants that he or she is
duly authorized to execute and deliver this Lease on its behalf. Each Party
shall, within thirty (30) days
<TABLE>
<S>                                                    <C>                            <C>
                                                        Page 13 of 16                 Initials____________
(c) . American Industrial Real Estate Association       REVISED                           FORM STN-6-2/97E
</TABLE>

<PAGE>

after request, deliver to the other Party satisfactory evidence of such
authority.

45.  Conflict.  Any conflict between the printed provisions of this Lease and
the typewritten or handwritten provisions shall be controlled by the typewritten
or handwritten provisions.

46.  Offer.  Preparation of this Lease by either Party or their agent and
submission of same to the other Party shall not be deemed an offer to lease to
the other Party. This Lease is not intended to be binding until executed and
delivered by all Parties hereto.

47.  Amendments.  This Lease may be modified only in writing, signed by the
Parties in interest at the time of the modification. As long as they do not
materially change Lessee's obligations hereunder, Lessee agrees to make such
reasonable non-monetary modifications to this Lease as may be reasonably
required by a Lender in connection with the obtaining of normal financing or
refinancing of the Premises.

48.  Multiple Parties.  If more than one person or entity is named herein as
either Lessor or Lessee, such multiple Parties shall have joint and several
responsibility to comply with the terms of this Lease.

49.  Mediation and Arbitration of Disputes.  An Addendum requiring the Mediation
and/or the Arbitration of all disputes between the Parties arising out of this
Lease [ ] is [X] is not attached to this Lease.

LESSOR AND LESSEE HAVE CAREFULLY READ AND REVIEWED THIS LEASE AND EACH TERM AND
PROVISION CONTAINED HEREIN, AND BY THE EXECUTION OF THIS LEASE SHOW THEIR
INFORMED AND VOLUNTARY CONSENT THERETO. THE PARTIES HEREBY AGREE THAT, AT THE
TIME THIS LEASE IS EXECUTED, THE TERMS OF THIS LEASE ARE COMMERCIALLY REASONABLE
AND EFFECTUATE THE INTENT AND PURPOSE OF LESSOR AND LESSEE WITH RESPECT TO THE
PREMISES.

--------------------------------------------------------------------------------
ATTENTION: NO REPRESENTATION OR RECOMMENDATION IS MADE BY THE AMERICAN
INDUSTRIAL REAL ESTATE ASSOCIATION OR BY ANY BROKER AS TO THE LEGAL SUFFICIENCY,
LEGAL EFFECT, OR TAX CONSEQUENCES OF THIS LEASE OR THE TRANSACTION TO WHICH IT
RELATES. THE PARTIES ARE URGED TO:

1.  SEEK ADVICE OF COUNSEL AS TO THE LEGAL AND TAX CONSEQUENCES OF THIS LEASE.

2.  RETAIN APPROPRIATE CONSULTANTS TO REVIEW AND INVESTIGATE THE CONDITION OF
THE PREMISES. SAID INVESTIGATION SHOULD INCLUDE BUT NOT BE LIMITED TO: THE
POSSIBLE PRESENCE OF HAZARDOUS SUBSTANCES, THE ZONING OF THE PREMISES, THE
STRUCTURAL INTEGRITY, THE CONDITION OF THE ROOF AND OPERATING SYSTEMS, AND THE
SUITABILITY OF THE PREMISES FOR LESSEE'S INTENDED USE.

WARNING: IF THE PREMISES IS LOCATED IN A STATE OTHER THAN CALIFORNIA, CERTAIN
PROVISIONS OF THE LEASE MAY NEED TO BE REVISED TO COMPLY WITH THE LAWS OF THE
STATE IN WHICH THE PREMISES IS LOCATED.
--------------------------------------------------------------------------------

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

Executed at: 24811 Avenue Rockefeller,    Executed at: 24811 Avenue Rockefeller,
             Valencia, CA                              Valencia, CA
on:                                       on:
   -----------------------------------       -----------------------------------

By LESSOR:                                By LESSEE:

24811 AVENUE ROCKEFELLER, LLC,            FUTURE MEDIA PRODUCTIONS, a California
--------------------------------------    --------------------------------------
a Delaware limited liability company      corporation
--------------------------------------    --------------------------------------
By: /s/ Alex Sandel                       By: [signature illegible]
   -----------------------------------       -----------------------------------

Name Printed: Alex Sandel                 Name Printed:
             -------------------------                 -------------------------
Title: Manager                            Title:
      --------------------------------          --------------------------------

By:                                       By:
   -----------------------------------       -----------------------------------

Name Printed:                             Name Printed:
             -------------------------                 -------------------------
Title:                                    Title:
      --------------------------------          --------------------------------

                                 Page 14 of 15         Initials
(c)1997 - American Industrial       REVISED                     ------ -------
   Real Estate Association                                      FORM STN-6-2/97E
<PAGE>

Address:                                 Address:
        -------------------------------          -------------------------------

        -------------------------------          -------------------------------
Telephone: (    )                        Telephone: (    )
          -----------------------------            -----------------------------
Facsimile: (    )                        Facsimile: (    )
          -----------------------------            -----------------------------
Federal ID No.                           Federal ID No.
              -------------------------                -------------------------

NOTE: These forms are often modified to meet the changing requirements of law
      and industry needs. Always write or call to make sure you are utilizing
      the most current form: AMERICAN INDUSTRIAL REAL ESTATE ASSOCIATION, 700
      So. Flower Street, Suite 600, Los Angeles, California 90017. (213) 687-
      8777. Fax No. (213) 687-8616.

                                 Page 15 of 15
(c) 1997 - American Industrial      REVISED                     FORM STN-6-2/97E
    Real Estate Association
<PAGE>

                  ADDENDUM TO STANDARD INDUSTRIAL/COMMERCIAL
                           SINGLE-TENANT LEASE - NET
                                BY AND BETWEEN
                        24811 AVENUE ROCKEFELLER, LLC,
                     A DELAWARE LIMITED LIABILITY COMPANY
                                  ("LESSOR"),
                                      AND
                           FUTURE MEDIA PRODUCTION,
                           A CALIFORNIA CORPORATION
                                  ("LESSEE")

                      Dated For Reference Purposes Only,
                                 March 1, 2000

     50.  Base Rent: "Fair Market Rental".  Subject to the provisions of
Paragraph 51 hereof, the Base Rent payable hereunder shall be $53,842.75 ($.65 X
82,835 square feet) per month, payable on the 1st day of each month, commencing
on March 1, 2000 and continuing through and including February 28, 2005.
Commencing on March 1, 2005 (the "First Adjustment Date") and again on March 1,
2010 (the "Second Adjustment Date"), the monthly rental shall be adjusted to the
then "Fair Market Rental" (as such term is defined in Paragraph 53(a) hereof)
for the Premises, as determined pursuant to Paragraph 53(c) hereof. Subject to
the provisions of Paragraph 51 hereof, the Fair Market Rental, as so determined,
shall become the new Base Rent for the Premises for the 60-month period
following the First Adjustment Date, beginning on March 1, 2005 and continuing
through and including February 28, 2010, and for the remainder of the Original
Term following the Second Adjustment Date, beginning on March 1, 2010 and
continuing through and including February 28, 2013. Following the expiration of
the Original Term, if Lessee exercises one or both Options pursuant to Paragraph
53 hereof, subject to the provisions of Paragraph 51 hereof, the Base Rent
payable during each "Option Term" (as such term is hereinafter defined) will be
the Fair Market Rental for the Premises determined as of the first day of the
applicable Option Term.

     51.  Rental Increases tied to Changes in the Consumer Price Index.
Beginning on March 1, 2001 and on March 1 of each succeeding year during the
Original Term (except March 1, 2005 and March 1, 2010) and beginning on March 1
of the second year of each Option Term, the Base Rent, as determined pursuant to
Paragraph 50 hereof, shall be increased (but shall not decrease) by the
percentage increase in the "CPI" (as such term is hereinafter defined) for the
12 month period ending one month before each such March 1 date. The increased
monthly rent shall become the new Base Rent for purposes of determining the
increased monthly rental amount for the following 12 month period. The term
"CPI" means the Consumer Price Index of the Bureau of Labor Statistics of the
U.S. Department of Labor for All Urban Consumers for Los Angeles-Riverside-
Orange County, All Items (1982-1984 = 100). The provisions of this Paragraph 51
shall not apply during

<PAGE>

the first 12 months following the adjustment of the monthly rental to the then
Fair Market Rental for the Premises on the First Adjustment Date and the Second
Adjustment Date.

     52.  Brokers.  Lessee warrants and represents that it has not had any
contact or dealings with any real estate broker, finder or other person which
would give rise to the obligation to pay any brokerage commission or other fee
in connection with the Lease, and Lessee hereby indemnifies, holds harmless and
agrees to defend Lessor from and against any liability with respect to any
brokerage commission or fee arising out of any act or omission of Lessee,
including attorney's fees and costs.

     53.  Option to Extend Lease.

          (a)  Option to Extend Lease.  Lessor hereby grants to Lessee the right
and option (the "Option") to renew the Lease upon its termination for 2
additional periods of 5 years each, with the term for the first Option beginning
on the day following the expiration of the Original Term (each Option period
being an "Option Term"), and with the term for the second Option beginning on
the day following the expiration of the first Option Term, at the fair market
rental for properties similar in quality and character to the Premises (the
"Fair Market Rental") (as determined pursuant to Paragraph 53(c) hereof). The
Option shall be effective as of the date hereof (the "Effective Date").

          (b)  Exercise of Option.  Provided (i) the Option has not otherwise
expired or terminated as provided herein and (ii) Lessee is not then in default
under the Lease, the Option shall be exercised by Lessee providing Lessor
written notice of its unconditional and irrevocable exercise of the Option (the
"Notice"), at any time within 9 months, but no later than 6 months prior to the
expiration of the initial term (or, if applicable, within said time period prior
to the expiration of the first Option Term). If the Option is not exercised
after the last date to do so as provided in the foregoing sentence, the Option
shall expire and terminate and be of no further force or effect. If the Option
shall terminate with respect to the first Option Term, it shall also terminate
and be of no further force or effect with respect to the second Option Term.
Time is of the essence of the Option and this entire Paragraph 53.

          (c)  Determination of Fair Market Rental.  The Fair Market Rental for
the Premises shall be as mutually agreed between the parties. In the event
Lessor and Lessee shall disagree as to the determination of the Fair Market
Rental for the Premises for either Option Term, such dispute shall be settled by
an arbitrator mutually selected by Lessor and Lessee and shall be conducted in
accordance with the rules existing at the date thereof of the American
Arbitration Association. The dispute shall be submitted to a single arbitrator,
who shall have had at lease 10 years' experience in connection with matters such
as fair market rental determinations of commercial property located in Los
Angeles, California. Lessor and Lessee shall share equally the cost of such
arbitrator's fees and expenses. Judgment may be entered on any award rendered by
the arbitrator

                                      -2-
<PAGE>

in any federal or state court having jurisdiction. If the arbitrator determines
that there is a "prevailing party" in any arbitration under the Lease, that
party shall be awarded reasonable attorneys' fees and costs in connection with
that arbitration, as determined by the arbitrator. Lessor and Lessee shall
accept as final the Fair Market Rental as determined by the arbitrator.

          (d)  Termination of Option.  Lessee agrees to execute, acknowledge and
deliver to Lessor a quitclaim deed to the Premises, if requested by Lessor, upon
expiration or termination of the Option as provided in the Lease.

                                      -3-

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