Document:

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                                                                   EXHIBIT 10.20

                                 LEASE AGREEMENT

      THIS LEASE, made this 16th day of August, 2004, between CENTERPOINT 800
LLC, a Delaware limited liability company (hereinafter called "Landlord"), and
INNOTRAC CORPORATION, a Georgia corporation, (hereinafter called "Tenant"). In
consideration of the Leased Premises (as hereinafter defined) and the covenants,
conditions, and rents hereinafter set forth, it is agreed as follows:

      1.    PREMISES AND TERM:

            A. Landlord does hereby lease, demise, and let to Tenant, and Tenant
does hereby lease, take, and accept from Landlord, the premises being comprised
of approximately Seventy-five Thousand (75,000) square feet of space located in
the building shown on the site plan attached hereto as Exhibit "A" ("Leased
Premises") which building contains a net rentable area of approximately One
Hundred Seventy-nine Thousand Four Hundred Sixty-six (179,466) square feet
("Building"), and is located on the parcel lot of ground known as 800
Centerpoint Boulevard in New Castle County, Delaware more fully described in
Exhibit "B" attached hereto ("Real Property"), together with the use in common
with other occupants of the Building of the parking areas and access roads
serving the Building.

            B. TO HAVE AND TO HOLD the same for two month term commencing on
August 16, 2004 and ending on October 15, 2004 ("Temporary Term") with a renewal
term of three (3) years (the "Term") commencing on October 16, 2004 (hereinafter
the "Commencement Date") and ending on October 15, 2007 (hereinafter the
"Termination Date"). Tenant shall notify Landlord in writing of its option to
exercise the Term within twenty (20) business days prior to the start of the
Term. Notwithstanding anything to the contrary contained in this Agreement,
Tenant shall have no liability under this Agreement if it does not elect to
exercise the Term at upon

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expiration of the Temporary Term. In the event Tenant does not notify Landlord
of its intent to terminate, Tenant shall pay Basic Rental and Additional Rent
through November 15, 2004. Tenant shall remove all of Tenant's property from
Leased Premises and turn over space to Landlord as required by this Lease
Agreement by November 15, 2004. Landlord shall provide access to Tenant to
Leased Premises immediately upon execution of this Lease. Tenant shall upon
taking access put in electric meter for Leased Premises in Tenant's name.

      2.    TENANT IMPROVEMENTS;

            Landlord shall install tenant improvements at the Leased Premises,
in accordance with the summary attached hereto as Exhibit "C" (collectively, the
"Tenant Improvements").

      3.    RENT:

            Tenant covenants to pay to Landlord, the basic rent ("Basic Rental")
per the following schedule payable to Landlord via wire transfer at such wiring
address as Landlord shall provide to Tenant from time to time:

            The first month's Basic Rental is due upon signing of this Lease by
Tenant.

<TABLE>
<CAPTION>
 YEAR             MONTHLY BASIC RENTAL           ANNUAL BASIC RENTAL
 ----             --------------------           -------------------
<S>               <C>                            <C>
1                     $ 23,437.50*                  $ 281,250.00
2                     $ 24,062.50*                  $ 288,750.00
3                     $ 24,687.50*                  $ 296,250.00
</TABLE>

*Plus Additional Rent owed as outlined in this Lease Agreement.

            Such Basic Rental shall be payable in equal monthly installments in
advance and without demand, commencing on the Commencement Date and continuing
throughout the Term on the first day of each calendar month, but not later than
three (3) days following the first day of each calendar month, during the Term.
Basic Rental and any Additional Rent will be made

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payable to Centerpoint 800 LLC and mailed to Centerpoint 800 LLC, 1201 N. Market
Street, Suite 1605, Wilmington, DE 19801.

            A. The payment of Basic Rental shall be triple net the Landlord, and
accordingly shall be in addition to and over and above all other payments to be
made by Tenant as hereinafter provided, and all expenses pertaining to the
ownership, maintenance and use of the Leased Premises, except as expressly set
forth herein, it being the purpose and intent of the Landlord and Tenant that
the Basic Rental payable hereunder shall when received by Landlord be absolutely
triple net to it, and that except as expressly provided in Paragraph 12C below
all costs, charges, expenses and obligations of every kind relating to the
ownership of the Leased Premises and the use thereof which may arise or become
due during the Term shall be paid by Tenant and that Landlord shall be
indemnified and held harmless by Tenant from and against the same.

            B. Tenant covenants to pay when due, without any abatement,
deduction, or set-off, the Basic Rental provided for herein and to pay as
additional rental when due all other sums, costs, charges, and expenses payable
by Tenant under this Lease (collectively, "Additional Rental") and in the event
of any nonpayment thereof, such sums shall be collected as rent, and Landlord
shall have all the rights and remedies provided for herein or by law in the case
of nonpayment of rent. All payments of Basic Rental and Additional Rental,
except for any Additional Rent which may be disputed, which are not paid
promptly by Tenant to Landlord when due, shall be subject to a late charge of
one and a half percent (1.5%) per month.

            C. Tenant shall, at the execution of this Lease, pay to Landlord the
sum of Twenty-three Thousand Four Hundred Thirty-seven Dollars and Fifty Cents
($23,437.50) as a security deposit (the "Security Deposit"). The Security
Deposit shall be held by Landlord and may be applied in payment of any Basic
Rental and/or Additional Rental due under this Lease or to

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cure other default by Tenant during the Term including to reimburse Landlord for
the amount of any cost incurred or damage sustained as a result of the default.
The Security Deposit shall be retained by Landlord without interest and not in
trust or in a separate account. The portion of the Security Deposit which shall
not be utilized by Landlord during the Term shall be returned to Tenant upon the
expiration of the Term and surrender of the Demised Premises to Landlord in the
condition required by this Lease.

      4.    TAXES:

            Tenant covenants to pay Landlord, as Additional Rental, forty-one
point seventy-nine percent (41.79%) of any real estate taxes and assessments, as
hereinafter defined, levied on the Real Property and Building:

            a) Real estate taxes and assessments shall be adjusted and pro-rated
to the Commencement Date or the Termination Date as the case may be, however,
there shall be no right to proration upon a termination of this Lease if such
termination is caused by Tenant prior to the expiration of the Term.

            b) For purposes of this paragraph, the term "real estate taxes and
assessments" shall include any public charges against the Real Property
(including assessments by any county, municipality, metropolitan district or
commission), but shall specifically exclude any fines, penalties or interest.

      5.    FIRE AND EXTENDED COVERAGE AND RENTAL INSURANCE:

            Landlord shall maintain during the Term a policy of special form
property insurance covering the Building in an amount not less than its full
replacement cost with a reputable insurance company. Tenant covenants to pay
Landlord, as Additional Rental, forty-one point seventy-nine percent (41.79%) of
all premiums for such property insurance, as follows:

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            a) Premiums shall be adjusted and pro-rated to the Commencement Date
or the Termination Date as the case may be.

            b) The fire and extended coverage policy shall expressly waive any
right of subrogation against Landlord or Tenant and each party hereby waives any
such right of recovery against the other.

            c) In the event Tenant's occupancy causes any increase in premiums
for fire, and extended coverage insurance or rental insurance on the Building or
Real Property above the rate for [a general warehousing or distribution
facility] the Tenant shall pay the additional premiums due by reason thereof.
Bills for such additional premiums shall be rendered by Landlord to Tenant at
such times as Landlord may elect and shall be due from and payable by Tenant
when rendered, and the amount thereof shall be deemed to be, and be paid as
Additional Rental.

      6. SNOW REMOVAL, PARKING LOT MAINTENANCE, GROUNDS MAINTENANCE,
LANDSCAPING, SECURITY, MANAGEMENT FEES, COMMON AREA ELECTRIC, AND OTHER COMMON
AREA CHARGES:

            Tenant covenants to pay Landlord, as Additional Rental forty-one
point seventy-nine percent (41.79%) of all costs incurred by Landlord for snow
removal, parking lot maintenance, grounds maintenance, landscaping, security,
management fees, and administrative cost solely for management at property
manager level and below directly involved in the management of the Building,
water, sewer, Common Area electric, and all other common area expenses related
to the Building and the Real Property during the Term including without
limitation capital expenditures required by law (except to the extent such items
are the Tenant's

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responsibility pursuant to Paragraph 15 below) or which are designed to result
in cost savings or reductions.

      7.    PAYMENT OF ANNUAL OPERATING EXPENSES:

            Tenant shall pay Landlord for Annual Operating Expenses (as
hereinafter defined) in equal monthly installments in the amount set forth below
(prorated for any partial month), from the Commencement Date and continuing
throughout the Term on the first day of each calendar month during the Term, as
Additional Rental, without notice, demand, or set-off, provided that the monthly
installment for the first full month of the Term shall be paid at the signing of
this Lease. Landlord shall apply such payments to the operating expenses owed to
Landlord by Tenant pursuant to Paragraphs 4, 5, and 6 above (collectively,
"Annual Operating Expenses"). The initial amount of Annual Operating Expenses to
be paid by Tenant represents the estimated operating expenses during the first
calendar year of the Term on an annualized basis; from time to time Landlord may
adjust such estimated amount if the estimated operating expenses increase. By
April 30 of each year (and as soon as practical after the expiration or
termination of this Lease or at any time in the event of a sale of the Real
Property), Landlord shall provide Tenant with a statement of the actual amount
of such expenses for the preceding calendar year or part thereof. Landlord or
Tenant shall pay to the other the amount of any deficiency or overpayment then
due from one to the other or, at Landlord's option, Landlord may credit towards
Tenant's rent, Tenant's account for any overpayment. Upon prior, reasonable
written notice one (1) time per year, Tenant shall have the right, at its
expense, to audit any records, books or documents related to the Annual
Operating Expenses and shall provide Landlord with written notice of any
disputed Annual Operating Expenses. Tenant's obligation to pay Annual Operating
Expenses pursuant to this Paragraph 7 shall survive the expiration or
termination of the Lease. For purposes of this

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Paragraph 7, the Annual Operating Expenses for the Building for the first
calendar year of the Term are estimated to be Seventy-five Thousand Dollars and
Zero Cents ($75,000.00) per year and are summarized on attached Exhibit "D".
Basic Rental and any Additional Rent will be made payable to Centerpoint 800 LLC
and mailed to Centerpoint 800 LLC, 1201 N. Market Street, Suite 1605,
Wilmington, DE 19801 or sent by wire transfer, ACH or mail.

      8.    UTILITIES; ELECTRICAL EQUIPMENT

            Tenant shall pay any vendor directly for all charges for gas,
electricity, sewer (both sanitary and storm), telephone, water (including water
for fire protection service), and all other utilities and communication services
used, rendered or supplied upon or in connection with the Leased Premises.
Tenant acknowledges that Landlord has made no representations in this Lease
concerning the performance of the applicable public utility(s) servicing the
Leased Premises with Tenant being obligated to contract with such utility(s)
directly. Tenant shall be responsible at all times for the maintenance and
repair of all of Landlord's electrical equipment unless such repair is
necessitated by reason of waste or negligence on the part of Landlord, its
agents or employees. Should Tenant at any time require additional utility
service, Landlord agrees to cooperate with Tenant (at no cost to Landlord) and
to execute such documents as may be necessary to obtain same, but all costs in
connection therewith shall be paid by Tenant. In all events, Landlord's consent
(not to be unreasonably withheld) shall be required with respect to any expanded
or enhanced electric service which requires access to Landlord's electric
equipment servicing the Leased Premises. For purposes of this Paragraph 8, it is
understood that all equipment, power lines, and related property, which deliver
electric power from the main line of the electric supplier to the Leased
Premises are part of the Landlord's electrical equipment.

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            D. As to heat, ventilation, air conditioning, electricity, and any
other services, Landlord shall not be responsible or liable in any way for any
failure, interruption or inadequacy in the quantity or quality of the same where
caused by war, civil commotion, governmental restrictions, prohibitions or other
regulations, strikes, labor disturbances, inability to obtain adequate supplies
or materials, casualties, replacements, or causes beyond Landlord's reasonable
control whether similar or dissimilar to the foregoing.

      9.    LIENS OR ENCUMBRANCES:

            A. Tenant shall keep the Leased Premises free from any liens arising
out of any work performed, materials furnished or obligations incurred by or on
behalf of Tenant and shall indemnify, defend and hold Landlord harmless from all
claims, costs and liabilities, including reasonable attorneys' fees and costs,
in connection with or arising out of any such lien or claim of lien. Tenant
shall cause any such lien imposed on the Real Property to be released of record
by payment or posting of a proper bond within ten (10) days after written
request by Landlord.

            B. It is specifically understood and acknowledged by Tenant that
Tenant has no authority to act as agent or representative of, or bind Landlord
in any way with respect to contracts it may enter into for the alteration or
repair of the Leased Premises or the furnishing of any materials to be utilized
in connection therewith.

            C. Notwithstanding anything to the contrary in this Lease or in any
other writing signed by Landlord, neither this Lease nor any other writing
signed by Landlord shall be construed as evidencing, indicating, or causing an
appearance that any erection, construction, alteration or repair to be done, or
caused to be done, by Tenant is or was in fact for the immediate use and benefit
of Landlord. Further, notwithstanding anything contained herein to the contrary,
nothing contained in or contemplated by this Lease shall be deemed or construed
in any way to

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constitute the consent or request on the part of Landlord for the performance of
any work or services or the furnishing of any materials for which any lien could
be filed against the Leased Premises or the Building or the Real Property or any
part of any thereof, nor as giving Tenant any right, power, or authority to
contract for or permit the performance of any work or services or the furnishing
of any materials for which any lien could be filed against the Leased Premises,
the Building, the Real Property or any part of any thereof.

      10.   USE OF PREMISES:

            Tenant shall use and occupy the Leased Premises throughout the Term
solely for the purpose of warehouse, fulfillment operations and general office
and for no other purpose.

      11.   ALTERATIONS AND IMPROVEMENTS

            A. Upon completion of the Tenant Improvements in accordance with
Paragraph 2 and Exhibit "C" hereof, Landlord shall have no further obligation to
make any alterations or improvements to the Leased Premises except as provided
in Paragraph 12C hereof.

            B. Tenant further covenants that it will at no time or times make
any other alterations, improvements, or material changes of any kind to the
Leased Premises or the Building (collectively, "Alterations") over the amount of
$10,000 per occurrence without first submitting the plans thereof to Landlord
and securing the prior written consent of the Landlord. As a precondition to
receiving such Landlord's consent: (i) Tenant must demonstrate to Landlord's
satisfaction, in Landlord's sole determination, that the Tenant has the
financial ability to pay for any such Alteration(s); and (ii) the contractor or
contractors performing the Alteration(s) must acknowledge in writing to Landlord
in form and substance satisfactory to Landlord that it or they are relying
solely upon Tenant's ability to pay and are not looking to Landlord or to its
equity in the Real Property as a source of payment. Tenant acknowledges that the
preconditions set forth in

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subparagraphs (i) and (ii) above are material inducements to Landlord's consent
and shall be relied upon by Landlord in providing consent should Landlord, in
its sole discretion, elect to provide such consent.

            C. Tenant shall not install any equipment of any kind or nature
whatsoever which would or might necessitate any changes, replacements or
additions to any of the heating, ventilating, air conditioning, electric,
sanitary, or other systems serving the Leased Premises or any other portion of
the Building, without the prior written consent of the Landlord. In the event
that such consent is granted, all such replacements, changes or additions shall
be paid for by Tenant. At the expiration or earlier termination of the Term,
Tenant shall pay to Landlord Landlord's cost of restoring such systems to their
condition prior to such replacements, changes or additions, normal wear and tear
excepted.

            D. All improvements, alterations, replacements, and building service
equipment made or installed by or on behalf of Tenant and permanently affixed to
the Building shall immediately upon completion or installment thereof be and
become the property of Landlord without payment therefor by Landlord or, at
Landlord's option, after written notice to Tenant, any or all of the foregoing,
except for the Tenant Improvements, may be designated by Landlord as items which
shall be removed by Tenant at its sole cost and expense upon the expiration or
sooner termination of its Lease and in such event Tenant shall also repair all
damage to the Leased Premises caused by such installation or removal. All
machinery, equipment (other than HVAC and other building service equipment),
trade fixtures, movable partitions, furniture and furnishings installed by
Tenant or maintained on the Leased Premises, shall remain the property of
Tenant, and Tenant shall be entitled to remove the same or any part thereof upon
the expiration of the Term, but Tenant shall, at its expense, repair any and all
damage to the Leased Premises resulting from or

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caused by such removal. Landlord has the right to remove any of Tenant's
property remaining in the Leased Premises after ten (10) days following any
termination at Tenant's expense and at Landlord's option to treat the same as
Landlord's own or to store same at Tenant's expense. Landlord shall notify
Tenant in advance, if Tenant has previously provided Landlord with written
notice outlining improvements, in writing if any alterations or improvements
shall be required to be removed upon termination. The provisions of this
Paragraph 12 shall survive the expiration or sooner termination of this Lease.

      12.   REPAIRS AND MAINTENANCE:

            A. Tenant covenants throughout the Term, at its expense, to maintain
in good order and repair the interior structure of the Leased Premises, and to
maintain and replace when necessary, all window and door glass therein, interior
and exterior, to maintain and repair all building service equipment therein
including, but not limited to, electrical, plumbing, heating, air conditioning
and sprinkler equipment, pipes, wires, ducts, fixtures and appliances; to make
all ordinary and necessary repairs to any of the foregoing; to keep the Leased
Premises in a safe, clean, and sanitary condition; and to provide for the
removal of trash and rubbish. Landlord warrants that upon Tenant's occupancy,
that the following are in good order and repair: interior structure of the
Leased Premises, all window and door glass therein, interior and exterior, all
building service equipment therein including, but not limited to, electrical,
plumbing, heating, air conditioning and sprinkler equipment, pipes, wires,
ducts, fixtures and appliances; Landlord has made all ordinary and necessary
repairs to any of the foregoing prior to Tenant's occupancy.

            B. Landlord will provide, at Tenant's expense, for inspection at
least once each calendar quarter, of the Building's heating, air conditioning
and ventilating equipment (other than

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any such equipment installed in the Leased Premises by Tenant). Such inspection
shall encompass the work described on Exhibit "D" attached hereto and made a
part of and provide for necessary repairs thereto. Landlord will provide Tenant
with copies of all service calls and reports, upon written request to Landlord,
within thirty (30) days after any service call.

            C. Landlord agrees to perform at its expense, maintenance, repair
and replacement to: (i) the exterior and structural portions of the Building,
including without limitation, the replacement of parking lot; (ii) the roof and
roof membrane; (iii) all utility and Building systems not exclusively serving
the Leased Premises and those located outside of the Leased Premises; (iv) the
Common Areas at the Real Property; and (v) gutters, downspouts, flashing and
floor slab. The cost of all such repairs and replacements shall be allocated as
set forth in Paragraph 12D of this Lease except when such repairs and/or
replacements are necessitated by the negligence or other act or omission of the
Tenant or its employees, contractors or invitees (e.g. a roof penetration made
by Tenant's contractor as part of the Tenant's initial improvements) in which
event the cost shall be borne solely by Tenant.

            D. During the Term, the repair and replacement of capital items (as
determined by generally accepted accounting principles ("GAAP") such as the
roof, roof membrane, building systems, structural elements of the Building, HVAC
system components, utility connections, re-paving of parking lots and paved
areas are to be the expense and responsibility of the Landlord, with no
reimbursement by Tenant. Thereafter, during any extension or renewal of the
Term, the cost of these items shall be amortized over their useful life, and the
annual amortized portion of these costs shall be passed through as Annual
Operating Expenses. The repair of non-capital items as determined by GAAP shall
be included as part of Annual Operating Expenses both during the Term and any
extension or renewal thereof.

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      13.   LIABILITY INSURANCE:

            Tenant shall provide property and liability insurance throughout the
Term as follows:

            A. Tenant shall maintain in force special form property insurance
covering personal property Tenant places upon or installs within the Leased
Premises in an amount equal to the replacement cost of that personal property.

            B. Tenant shall maintain in force a policy of commercial general
liability insurance insuring Landlord, Tenant and Landlord's mortgagee(s) (the
"Mortgagee") against liability arising from Tenant's use, occupancy or
maintenance of the Leased Premises and appurtenant areas and providing
contractural liability coverage for the indemnities Tenant makes in Paragraph 18
of this Lease. Landlord and Mortgagee shall be named as additional insureds on
Tenant's policy. The amount of that insurance must be at least One Million
Dollars ($1,000,000.00) per occurrence for bodily injury to or death of any
persons or property damage, arising out of or related to Tenant's negligent acts
or omissions, with a Four Million Dollar umbrella policy as overlay. Tenant must
cause the policy by which Tenant provides that commercial general liability
insurance to be endorsed to order to confirm that (i) the insurance is primary
insurance, solely to the extent of Tenant's negligent acts or omissions and (ii)
insurance maintained by or for Landlord's benefit will not reduce the proceeds
payable in respect of any claim made on the insurance Tenant furnishes in
accordance with the terms of this Paragraph 13D.

            C. If Tenant does not qualify as a self-insurer in accordance with
the rules and regulations of the agency or commission that administers the
workers' compensation program in the State where the Leased Premises are
located, Tenant shall maintain in force workers' compensation insurance in the
amount required by applicable law and employer's liability

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insurance in an amount not less than Five Hundred Thousand Dollars
($500,000.00). The workers' compensation insurance must include an all-states
endorsement.

            D. Tenant shall also maintain automobile insurance coverage in an
amount of not less than $1,000,000 for its owned company autos.

            E. E. Each policy of insurance that Tenant maintains in accordance
with the terms of this Lease must be written by an insurance company licensed to
do business in the state where the Leased Premises are located and reasonably
satisfactory to Landlord, must be in form and substance reasonably satisfactory
to Landlord and must provide that the insurer will cancel, terminate or
materially change the policy only after it has given Landlord and Tenant written
notice of the anticipated cancellation, termination or material change at least
thirty (30) days in advance of the time at which the cancellation, termination
or material change becomes effective.

            F. Tenant may provide the insurance required by virtue of the
terms of this Lease by means of a combination of primary and excess or umbrella
coverage and by means of a policy or policies of blanket insurance so long as
(i) the amount of the total insurance allocated to the Leased Premises under the
terms of the blanket policy or policies furnishes protection equivalent to that
of separate policies in the amounts required by the terms of this Lease, and
(ii) the blanket policy or policies comply in all other respects with the other
requirements of this Lease.

            G. As soon as practicable, Tenant shall furnish to Landlord upon
request certificates of insurance reflecting that the policies Tenant has agreed
to maintain are in force, and it shall also provide certificates evidencing all
renewals of such policies.

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      14.   DAMAGE OR DESTRUCTION:

            A. If during the Term the Leased Premises are damaged by fire or
other casualty, but not to the extent that Tenant is prevented from carrying on
its business in the Leased Premises, Landlord shall promptly restore the Leased
Premises to their condition immediately prior to the casualty subject, however,
to reasonable delays for insurance adjustments and to delays caused by matters
beyond Landlord's reasonable control.

            B. If during the Term the Leased Premises are destroyed or so
damaged by fire or other casualty that Tenant is prevented from carrying on its
business in the Leased Premises, Landlord shall have the option either to
restore the Leased Premises to their condition immediately prior to the casualty
or to terminate this Lease. Such option shall be exercised by Landlord by
written notice to the Tenant within thirty (30) days after the casualty.

                  If Landlord chooses to restore the Leased Premises, it shall
prepare or cause to be prepared a reasonable estimate of the time needed to
restore the Leased Premises to their condition immediately prior to the
casualty. Such estimate shall accompany the above referenced written notice to
Tenant. If the time period indicated in the notice exceeds ninety (90) days,
Tenant may terminate this Lease within five (5) days of receipt of Landlord's
notice provided, however, that termination shall not be permitted: (i) if Tenant
was the sole cause of the damage or destruction; and (ii) unless the Mortgagee
has been given notice and opportunity to cause repairs to be made within one
hundred twenty (120) days.

                  If the restoration period is less than one hundred twenty
(120) days or if Tenant agrees to a restoration period in excess of one hundred
twenty (120) days, then Landlord shall promptly commence such repair work and
diligently proceed to complete the same subject,

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however, to reasonable delays for insurance adjustments and to delays caused by
matters beyond Landlord's reasonable control.

                  In the event that a casualty occurs within the last nine (9)
months of the term of this Lease Landlord (and Tenant if it is not the cause of
the casualty) shall have the right to terminate this Lease upon notice given to
the other party within thirty (30) days after the date of the casualty.

                  Notwithstanding anything to the contrary contained in this
Paragraph 14 Landlord shall have no duty to repair or replace any personal
property of Tenant or any of Tenant's fixtures or equipment or any Alterations
made by Tenant and Landlord shall have no liability to Tenant for, and Tenant
shall not be entitled to terminate this Lease by virtue of, any delays in the
completion of repairs for any reason beyond the reasonable control of Landlord.

                  Basic Rental shall be equitably abated for any period that the
Leased Premises are destroyed or damaged to the extent that Tenant is
substantially prevented from carrying on its business in the Leased Premises
unless Tenant was the cause of the damage or destruction.

      15.   COMPLIANCE WITH LAWS:

            Tenant covenants throughout the Term at its expense to comply
promptly with all laws, codes, ordinances, administrative and court orders and
directives, rules and regulations which have the force of law, whether now in
effect or hereafter promulgated, applicable to Tenant's use and occupancy of the
Leased Premises, and shall be required to install at its cost all Alterations
and/or improvements (both structural and nonstructural), required by law or code
or any capital improvements required by law or code as a result of Tenant's
occupancy of the Leased Premises, except that Landlord warrants that the Leased
Premises shall be in compliance with the

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Americans with Disabilities Act and any such alterations or improvements
required to cause the Leased Premises to be in such compliance shall be at
Landlord's sole cost and expense except to improvements made by Tenant to Leased
Premises. If during the Term, due to a change in the law, any other alterations
to the Leased Premises which are the responsibility of Landlord under the terms
of this Lease are required, the respective expenses will be amortized over their
useful life as provided in Paragraph 12D hereof.

      16.   CONDEMNATION:

            A. If during the Term, all or a substantial part of the Leased
Premises, the Building, or the Real Property shall be taken by eminent domain,
then at the option of the Tenant or the Landlord this Lease shall terminate as
of, and the Basic Rental and Additional Rental shall be apportioned to and
abated from and after, the date of taking, and Tenant shall have no right to
participate in any award or damages for such taking (except as set forth in
Paragraph 16D hereof) and hereby assigns all of its right, title, and interest
therein to Landlord. For purposes of this Paragraph 16 "a substantial part of
the Leased Premises" shall mean a taking which renders Tenant unable to carry on
its business on the Leased Premises.

            B. If during the Term, less than a substantial part of the Leased
Premises, the Building or the Real Property shall be taken by eminent domain,
this Lease shall remain in full force and effect; and Tenant shall have no right
to participate in any award or damages for such taking and hereby assigns all of
its right, title, and interest therein to Landlord, provided that Landlord shall
at its expense promptly make such repairs and improvements as shall be necessary
to restore the Leased Premises to substantially the same efficiency as before
the taking to the extent practicable..

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            C. For the purpose of this Paragraph 16, "taken by eminent domain"
or "taken under the power of eminent domain" shall include a negotiated sale or
lease and transfer of possession to a condemning authority under bona fide
threat of condemnation for public use, and Landlord alone shall have the right
to negotiate with the condemning authority and conduct and settle all litigation
connected with the condemnation. As hereinabove used, the words "award of
damage" shall, in the event of such sale or settlement, include the purchase or
settlement price of any such negotiated transfer.

            D. Nothing herein shall be deemed to prevent Tenant from claiming,
negotiating, and receiving from the condemning authority, if legally payable,
compensation for the taking of Tenant's own tangible property, improvements upon
the Leased Premises constructed at Tenant's sole expense, and damages for
Tenant's loss of business, business interruption and/or removal and relocation
as long as any such compensation to Tenant does not reduce the condemnation
award recoverable by Landlord. Should the condemnation be affected without a
cancellation of this Lease, there shall be an appropriate reduction in Basic
Rental and Additional Rental commensurate with the area so taken.

      17.   LANDLORD'S RIGHT TO PERFORM TENANT'S COVENANTS:

            If Tenant shall fail to perform any covenant or duty required of it
by this Lease or by law, Landlord shall, after notice to Tenant, and Tenant's
failure to cure, as provided for in Section 20 hereunder, have the right (but
not the duty) to enter the Leased Premises, if necessary, to perform the same
without further notice, but the reasonable cost thereof shall be deemed to be
Additional Rental, and shall give the Landlord the same rights and remedies as
though the Additional Rental were part of the Basic Rental due the Landlord
under this Lease.

                                       18
<PAGE>

      18.   INDEMNIFICATION OF LANDLORD:

            Except with respect to claims arising from Landlord's negligent acts
or omissions, or that of its agents, servants, contractors, or employees, Tenant
covenants to indemnify and save Landlord harmless (to the extent not reimbursed
by insurance required by this Lease to be furnished by Tenant) from any and all
claims for liability of any nature whatever arising from any use, occupancy,
construction, repairs, or other work or activity done in, on, or about the
Leased Premises during the Term by Tenant or Tenant's agents, servants,
contractors, employees, licensees, or invitees or from any condition of the
Leased Premises or anything thereon or therein during the Term, or from any
occurrence whatever in, on, or about the Leased Premises during the Term,
including all Landlord's reasonable costs, expenses, and counsel fees in
connection with any such claim.

            Except with respect to claims arising from Tenant's negligent acts
or omissions, or that of its agents, servants, contractors, or employees,
Landlord covenants to indemnify and save Tenant harmless (to the extent not
reimbursed by insurance required by this Lease to be furnished by Landlord) from
any and all claims for liability of any nature whatever arising from any use,
occupancy, construction, repairs, or other work or activity done in, on, or
about the Leased Premises and the Building during the Term by Landlord or
Landlord's agents, servants, contractors, employees, licensees, or invitees or
from any condition of the Leased Premises or the Building anything thereon or
therein during the Term, or from any occurrence whatever in, on, or about the
Leased Premises or the Building during the Term, including all Tenant's
reasonable costs, expenses, and counsel fees in connection with any such claim.

                                       19
<PAGE>

      19.   LANDLORD'S EXONERATION:

            Except with respect to claims arising from Landlord's negligent acts
or omissions, or that of its agents, servants, contractors, or employees, or
from Landlord's failure to make repairs or maintenance required of it to be made
pursuant to this Lease, Tenant covenants to save harmless, protect and indemnify
the Landlord from and against any and all losses, damages, claims, suits, or
actions, judgments, and costs, which may arise or grow out of any injury to or
death of any person or damage to any property (including, but not by way of
limitation, Tenant and employees of Tenant and their property) which is caused
by Tenant's negligent acts or omissions, its agents or servants, sublessees and
assigns, in the use and possession of the Leased Premises and the equipment
thereon by Tenant or the operation of the business conducted by Tenant on the
Leased Premises.

      20.   DEFAULT PROVISIONS:

            Each of the following events shall be deemed an event of default by
Tenant within the meaning of this Paragraph 20:

            (a) the failure to pay any installment of Basic Rental or Additional
Rental when due and payable;

            (b) the failure to perform any of the material non-monetary
covenants or conditions of this Lease on the part of Tenant to be performed;

            (c) if Tenant shall abandon the Leased Premises or removes Tenant's
property therefrom other than in the ordinary course of business;

            (d) the making of an assignment by Tenant or Guarantor (as
                hereinafter defined) for the benefit of its creditors;

                                       20
<PAGE>

            (e) the appointment of a receiver or trustee of all or part of
Tenant's or Guarantor's property;

            (f) the filing of a petition in bankruptcy by Tenant or Guarantor;

            (g) the filing of a petition by or against Tenant or Guarantor for
its reorganization or for an arrangement under any bankruptcy law or other law;
or

            (h) the filing of or petition by Tenant or Guarantor to effect a
composition or an extension of time to pay its debts; provided that if an event
referred to in sections (e) and (g) above shall have been involuntary on the
part of Tenant or Guarantor, the Tenant shall have sixty (60) days to discharge
the receiver or trustee or dismiss the petition after the appointment or filing.

            Upon the occurrence of any event of default described above (except
for an event of default under subparagraph (b) above), Landlord may elect to
terminate this Lease immediately upon serving a written notice of termination
upon Tenant. Upon the occurrence of an event of default described in
subparagraph (b) above, then Landlord may elect to terminate this Lease by
serving a written notice upon Tenant of Landlord's election to terminate this
Lease upon a specified date, not less than thirty (30) days after the day of
serving of such notice. If said event of default shall not be corrected within
said thirty (30) day period, this Lease shall then expire on the date specified,
as if that date had originally fixed as the expiration of the Term.

            In the event that this Lease is terminated in the manner provided
for in this Paragraph 20, or by court proceedings or otherwise, Landlord or
Landlord's agents, servants, or representatives may, at any time after written
notice to Tenant and the times set forth in this Paragraph 20, reenter and
resume possession of said Leased Premises, or any part thereof, and remove all
persons and property therefrom (at the cost and expense of Tenant), either by
any

                                       21
<PAGE>

suitable action or proceeding at law or otherwise, without being liable for any
damages thereof. No reentry by Landlord shall be deemed to be an acceptance of a
surrender of this Lease.

            In case the Basic Rental or any installment of said Basic Rental
hereby agreed to be paid shall at any time be in default, the Landlord shall
have the right to distrain therefor.

            The Landlord, upon the happening of any of the events giving it the
right to cancel and terminate this Lease, shall be entitled to the benefit of
all of the provisions of law for the speedy recovery of lands and tenements in
the State of Delaware that are now in force or may hereafter be enacted and as
such Landlord shall be entitled to exercise any or all rights or remedies
available to landlords in the State of Delaware at law or in equity following a
tenant default. All remedies available to Landlord under this Lease and at law
or in equity shall be cumulative and concurrent.

      21.   ADDITIONAL REMEDIES OF LANDLORD:

            In the event that this Lease is terminated in the manner set forth
in Paragraph 20, hereof, or by court proceedings or otherwise, Landlord may for
its own account, relet the whole or any portion of said Leased Premises for any
period equal to or greater or less than the remainder of the Term for any sum
which it may deem reasonable, to any tenant(s) which it may deem suitable and
satisfactory, and for any use and purposes which it may deem appropriate, but in
no event shall Landlord be under any obligation or duty to relet the same Leased
Premises. In the event of such termination of this Lease, or in the event of any
default or event of default mentioned in Paragraph 20 hereof, and whether or not
the Leased Premises be relet, and whether this Lease be terminated or not,
Landlord shall be entitled to recover of Tenant, and Tenant hereby agrees to pay
Landlord as damages, the following:

                                       22
<PAGE>

            (i) The amount of Basic Rental reserved under this Lease, less the
rent, if any, collected by Landlord on reletting the Leased Premises, plus the
Landlord's reasonable costs for reletting and the amount of any then unpaid
Additional Rental. The aforementioned sums will be due within thirty (30) days
of termination.

            (ii) In addition to the damages hereinbefore provided for in this
Paragraph 21, an amount equal to the cost of

                  (a) placing the Leased Premises in the condition in which
Tenant has agreed to surrender them to Landlord, and

                  (b) of performing any other covenant herein contained which
Tenant has agreed to perform, other than the covenant to pay Basic Rental.

                  Without any previous notice or demand, separate actions may be
maintained by Landlord against Tenant from time to time to recover any damages
which, at the commencement of any such action, have then or theretofore become
due and payable to Landlord under this Paragraph 21, without waiting until the
end of the Term.

                  (c) In the event of such termination of this Lease, or in the
event of any default or event of default mentioned in Paragraph 20 hereof, and
whether or not the Leased Premises be relet, and whether this Lease be
terminated or not, Landlord shall, in addition to all other rights and remedies
available to it by law or equity or by any other provisions hereof, be entitled
to declare to be immediately due and payable all Basic Rental and Additional
Rental reserved for the balance of the Term.

      22.   RIGHT TO ASSIGN AND SUBLEASE:

            Tenant may not assign this Lease or sublet the Leased Premises
without the prior written consent of Landlord, which consent will not be
unreasonably withheld (except to the extent

                                       23
<PAGE>

otherwise provided in this Paragraph 22), provided that in the event of any such
assignment or subletting with consent, Tenant shall remain liable for the
performance of Tenant's obligations during the balance of the Term and provided
further that any rental received by Tenant in excess of the Basic Rental
reserved under this Lease or any payment made to Tenant in consideration of such
assignment or subletting shall be paid over to Landlord as Additional Rental
concurrently with such assignment or subletting. For purposes of this Paragraph
22, a transfer, by any person and/or entity controlling the Tenant on the date
hereof, of such control to a person and/or entity not controlling the Tenant on
the date hereof shall be deemed to be an assignment of this Lease. However
notwithstanding the foregoing Landlord shall in no event be required to consent
to any: (i) sublease of space for rent less than that Tenant is required to pay
under this Lease; or (ii) assignment or subletting to a proposed assignee or
subtenant that is an existing tenant of Landlord or of any affiliate of
Landlord.

      23.   INSPECTION BY LANDLORD, ETC:

            Upon reasonable prior notice to Tenant and during standard business
hours (emergencies excepted), Landlord and its agents shall have the right at
all reasonable times during the Term to enter the Leased Premises for the
purpose of performing the maintenance and repairs required of it by this Lease
and for the purpose of inspecting the same and, during the last one hundred and
twenty (120) days of the Term, to show both the interior and exterior of the
Leased Premises to prospective tenants or purchasers and to place "For Rent" of
"For Sale" signs thereon. Such inspections and/or showings shall not disrupt the
business operations of Tenant.

      24.   ASSIGNMENTS OF LANDLORD'S INTEREST:

            If Landlord should ever assign this Lease or the Basic Rental
hereunder to a creditor as security for a debt, Tenant shall, after notice of
such assignment, and upon demand by

                                       24
<PAGE>

 Landlord or the assignee, pay all sums thereafter becoming due Landlord
 hereunder to the assignee (from and after the time Tenant is furnished with
 such assignee's address) and furnish such evidence of insurance coverages
 required hereunder as the assignee may reasonably require so as to protect the
 assignee's interest as it may appear and furnish such assurances to the
 assignee as it may reasonably request.

      25.   ATTORNMENT:

            In the event the Leased Premises are sold at any foreclosure sale or
sales, by virtue of any judicial proceedings or otherwise, this Lease shall
continue in full force and effect and Tenant agrees upon request to attorn to
and acknowledge the foreclosure purchaser or purchasers at such sale as Landlord
hereunder.

            The Tenant shall, promptly at the request of the Landlord or any
Mortgagee, execute, enseal, acknowledge, and deliver such further instrument or
instruments:

            a) evidencing such subordination as the Landlord or such Mortgagee
deems necessary or desirable, and

            b) (at such Mortgagee's request) attorning to such Mortgagee,
provided that such Mortgagee agrees with the Tenant that such Mortgagee will, in
the event of a foreclosure of any such mortgage or deed of trust (or termination
of any such ground lease) take no action to interfere with the Tenant's right
hereunder, except on the occurrence of a default or event of default.

      26.   SUBORDINATION:

            This Lease shall be subject and subordinate to the lien of any
present or future mortgage or mortgages upon the Leased Premises or the Real
Property irrespective of the time of execution or the time of recording of any
such mortgage or mortgages provided that in the event of

                                       25
<PAGE>

foreclosure or other action taken under any mortgage by the holders thereof,
this Lease and the rights of Tenant hereunder shall not be disturbed but shall
continue in full force and effect so long as Tenant shall not be in default
hereunder. The word "mortgage" as used herein includes mortgages, deeds of trust
or other similar instruments and modifications, extensions, renewals and
replacements thereof and any and all advances thereunder.

      27.   MORTGAGEE PROTECTION CLAUSE:

            Tenant agrees to give all Mortgagees by certified mail, a copy of
any notice of default served upon the Landlord, provided that prior to such
notice, Tenant has been notified in writing (by way of notice of assignment of
rents and leases, or otherwise) of the address of such Mortgagee(s). Tenant
further agrees that if Landlord shall have failed to cure such default, then the
Mortgagee(s) shall have thirty (30) days from the date of receiving notice
within which to cure such default, or if such default cannot be cured within
that time, then such additional time as may be necessary if within such thirty
(30) days any Mortgagee has commenced and is diligently pursuing the remedies
necessary to cure such default (including but not limited to commencement of
foreclosure proceedings if necessary to effect such cure), in which event this
Lease shall not be terminated while such remedies are being so diligently
pursued.

      28.   QUIET ENJOYMENT:

            Landlord covenants and warrants to Tenant that Tenant on paying the
Basic Rental and Additional Rental provided for in this Lease and performing its
material covenants herein set forth, shall peaceably and quietly have, hold and
enjoy the Leased Premises and all appurtenances thereon during the full Term
pursuant and subject to the terms of this Lease without hindrance or molestation
by Landlord or anyone claiming by or through Landlord.

                                       26
<PAGE>

      29.   FAILURE TO INSIST UPON STRICT PERFORMANCE:

            The failure of either party to insist upon a strict performance of
any of the terms, conditions, and covenants herein contained shall not be deemed
a waiver of any rights or remedies that either party may have and shall not be
deemed a waiver of any subsequent breach or default in the terms, conditions,
and covenants herein contained. This Lease may not be changed, modified, or
discharged except by a writing signed by both parties hereto.

      30.   TENANT HOLDING OVER:

            A. In the event Tenant remains in possession of the Leased Premises
after the expiration of the Term, without the written consent of Landlord, such
event shall be construed to be a tenancy from month-to-month at one and one-half
(1-1/2) times the monthly Basic Rental herein specified during the last month of
the expired Term, and shall otherwise be on the terms and conditions herein
specified.

            B. In the event that Tenant holds over at the expiration of the Term
or at the earlier termination thereof, Landlord shall be entitled to all the
remedies now or hereafter in effect in the State of Delaware, at law or in
equity, relating to the speedy recovery of possession of lands and damages for
wrongful detention.

      31.   UTILITY LINES AND FACILITIES:

            Landlord reserves the right to place (or permit any other tenant in
its Building so to place) in, over, below and upon the Leased Premises (in such
a manner as to not unreasonably interfere with Tenant's use of the Leased
Premises), utility lines, conduits, pipes, tunneling and the like to service the
Leased Premises and any other premises in the Building and to use, replace,
repair, and maintain (or permit any other tenant so to do) such utility lines,
conduits, pipes, tunneling and the like, in, over, below, and upon the Leased
Premises in such a manner as will not

                                       27
<PAGE>

materially interfere with Tenant's enjoyment thereof, provided that Landlord
shall use its best efforts to see that such work does not significantly
interfere with the ongoing business and operations of Tenant, that such work
shall be done expeditiously and in a workmanlike manner, and further that the
Leased Premises shall, upon conclusion of the work, be restored to substantially
the same conditions as they were prior to the commencement of the work.

      32.   SIGNS:

            Tenant shall be permitted to place signage on the exterior of the
Building or otherwise outside of the Building. Such signage shall be similar to
that depicted on Exhibit I, attached hereto. All signage shall be used for no
other purpose except to display Innotrac corporate name and/or logo.

      33.   END OF TERM:

            Upon the expiration or other termination of the Term, Tenant shall
quit the Leased Premises and surrender same to Landlord, broom clean, in good
order and condition ordinary wear and tear and damage or destruction by fire or
other casualty or the elements unless caused by Tenant or any other cause beyond
Tenant's reasonable control excepted and Tenant shall remove all of its
property.

      34.   SUCCESSORS AND ASSIGNS:

            Except as hereinabove expressly otherwise provided, this Lease shall
bind and inure to the benefit of the parties hereto and their respective
successors and assigns. Landlord's liability under this Lease shall be limited
to its interest in the Leased Premises and the Building.

      35.   NOTICES:

            All notices, requests, demands or other communications with respect
to this Lease, whether or not herein expressly provided for, shall be in writing
and shall be deemed to have been

                                       28
<PAGE>

duly given either (a) forty-eight (48) hours after being mailed by United States
First-Class, certified or registered mail, postage prepaid, return receipt
requested, or (b) the next business day after being deposited (in time for
delivery by such service on such business day) with Federal Express or another
national courier service, for delivery to the parties at the following addresses
(which such addresses may be changed by either party by giving written notice
thereof to the other):

            If to Landlord:

            Centerpoint 800 LLC
            1201 N. Market Street, Suite 1605
            Wilmington, Delaware 19801
            Attn: Mr. Paul M. McConnell

            with a copy to:

            McConnell Development, Inc.
            1201 N. Market Street, Suite 1605
            Wilmington, Delaware 19801
            Attention: Chief Financial Officer

            If to Tenant:

            Innotrac Corporation
            6655 Sugarloaf Parkway
            Duluth, GA. 30097
            Attention: David Gamsey, Chief Financial Officer

            With a copy to:

            Attention: Sandra Langley, General Counsel

Notices may be sent on behalf of a party by its legal counsel.

      36.   AGENCY:

            Unless otherwise disclosed, Broker (as hereinafter defined), any
cooperating broker, and any salesperson working with either, are representing
the Landlord's interest and have

                                       29
<PAGE>

fiduciary responsibilities to Landlord, but are obligated to treat all parties
fairly. Broker, any cooperating broker, and any salesperson working with either,
without breaching the fiduciary responsibilities to Landlord, may, among other
services, provide a potential tenant with information about the attributes of
properties and available financing, show properties, and assist in preparing an
offer to lease. Broker, any cooperating broker, and any salesperson working with
either, also have the duty to respond accurately and honestly to a potential
Tenant's questions and disclose material facts about properties, submit promptly
any offers to lease and offer properties without unlawful discrimination.
Landlord and Tenant represent that neither party entered into any agreement with
any broker or agent except McConnell Johnson Real Estate Company, LLC and CB
Richard Ellis, Inc. (the "Broker") regarding this Lease or the Leased Premises
and Landlord shall be responsible for payment of any and all brokerage fees or
commissions payable to the Broker in connection with this Lease for the Leased
Premises. Landlord and Tenant each agree to indemnify, defend and hold the other
harmless from all costs and liabilities, including reasonable attorneys' fees
and costs, arising out of or in connection with claims made by any other broker
or individual who alleges that it is entitled to commissions or fees with regard
to this Lease as a result of dealings it had with the indemnifying party.

      37.   RECORDING:

            Landlord and Tenant agree to execute a Memorandum of Lease which may
be recorded among the Land Records of New Castle County, Delaware, at the
expense of the Landlord if Landlord elects to record.

      38.   TENANT ESTOPPEL CERTIFICATES:

Tenant shall, within twenty (20) days after written request of Landlord,
execute, acknowledge and deliver to Landlord or to Landlord's Mortgagee,
proposed mortgagee, land lessor or proposed

                                       30
<PAGE>

purchaser of the Leased Premises, any estoppel certificate(s) requested by
Landlord which shall state whether this Lease is in full force and effect and
whether any changes may have been made to the original of this Lease; whether
the Term of this Lease has commenced and full rent is accruing; whether there
are any defaults by Landlord and, if so, the nature of such defaults; whether
possession has been assumed and all improvements to be provided by Landlord have
been completed; whether rent has been paid more than thirty (30) days in
advance; whether there are any liens, charges, or offsets against rent due or to
become due; and stating any other fact or certifying as to any other condition
as Landlord may reasonably request. Tenant acknowledges that any certificate
delivered pursuant to the provisions of this Paragraph 38 may be relied upon by
Landlord and/or any such mortgagee, lessor or purchaser.

      39.   CAPTIONS AND HEADINGS:

            The captions and headings throughout this Lease are for convenience
and reference only, and the words contained therein shall in no way be held or
deemed to define, limit, describe, explain, modify, amplify, or add to the
interpretation, construction, or meaning of any provision of or the scope or
intent of this Lease nor in any way affect this Lease.

      40.   ENVIRONMENTAL MATTERS:

            A. Tenant represents and warrants that the use of the Leased
Premises will not result in or involve the use, generation, manufacture,
refining, transportation, treatment, storage, handling, or disposal of, or the
conduct or performance of any activity in connection with, any hazardous
substance or hazardous waste, as such terms are defined in the Delaware General
Waste Management Act, 7 Del. C., Chapter 60, the Delaware Hazardous Waste
Management Act, 7 Del. C., Chapter 63, the Federal Resource SS6690, et seq., the
Federal Comprehensive Environmental Response, Compensation and Liability Act of
1980, as amended, 42 U.S.C. SS9601, et seq., and

                                       31
<PAGE>

the regulations promulgated under said Acts, which would subject the Leased
Premises or Landlord to any liability, including damages, penalties or fines, or
any lien on the Leased Premises under such Acts or under the Federal common law
or the common law of the State of Delaware.

            B. Tenant shall indemnify and hold harmless Landlord, its directors,
officers, partners, and all of its employees, agents, and contractors against
all costs incurred (including, without limitation, amounts paid pursuant to
penalties, fines, orders, judgment or settlements and attorney's fees
originating out of any claim made by Federal, State, or local agencies or
departments or private litigants or third parties) with respect to violations or
alleged violations by Tenant, its agents, employees, or invitees of
environmental or health laws, rules, regulations, orders, or common law, as said
laws, etc. are set forth above or otherwise.

            C. Landlord shall indemnify and hold harmless Tenant, its officers,
directors, partners, and any of its employees, against all costs incurred
(including, without limitation, amounts paid pursuant to penalties, fines,
orders, judgments, or settlements and attorneys' fees, originating out of any
claim made by Federal, State, or local agencies or departments or private
litigants or third parties) with respect to violations or alleged violations by
Landlord, its agents, employees, or invitees of environmental or health laws, or
regulations, orders or common law as said laws, etc., are set forth above, or
otherwise, provided that such violations or alleged violations are not in whole
or in part related to Tenant or Tenant's use of the Leased Premises. As used
herein, Tenant shall mean and include Tenant and Tenant's agents, employees, and
invitees. Notwithstanding anything to the contrary contained herein, Landlord
shall be solely responsible under this indemnification provision for any
violation of any environmental or other federal or state law that pre-dates
Tenant's use of the Leased Premises.

                                       32
<PAGE>

      41.   NO OFFER:

            The submission of this Lease for examination or the negotiation of
the transactions described herein or the execution of this Lease by only one of
the parties shall not in any way constitute an offer to lease on behalf of
either Landlord or Tenant, and this Lease shall not be binding on either party
until duplicate originals thereof, duly executed on behalf of both parties, have
been delivered to each of the parties hereto.

      42.   FINANCIAL STATEMENTS:

            Upon the request of Landlord Tenant shall supply to Landlord copies
of all of Tenant's and/or Guarantor's most recent financial statements then
available. Such financial statements shall be provided by Tenant to Landlord
within fifteen (15) days after Landlord's request therefor and shall be kept
confidential but may be disclosed to: (i) the extent required by law; and (ii)
Landlord's employees and advisors (e.g. accountants, attorneys etc.) who are
similarly bound by such confidentiality, to the extent necessary for Landlord to
exercise its rights and fulfill its obligations under this Lease.

      43.   MISCELLANEOUS PROVISIONS:

            43.1. TIME PERIODS. All periods of time referred to in this Lease
shall include all Saturdays, Sundays and state or national holidays, unless the
period of time specifies business days, however if the date or last date to
perform any act or give notice or approval shall fall on a Saturday, Sunday or
state or national holiday, such act, notice or approval shall be timely if
performed or given on the next succeeding day which is not a Saturday, Sunday or
state or national holiday.

                                       33
<PAGE>

            43.2. SEVERABILITY. If any provisions of this Lease shall be held to
be invalid, void or unenforceable, the remaining provisions hereof shall not be
affected or impaired, and such remaining provisions shall remain in full force
and effect.

            43.3. EXHIBITS. All exhibits referred to herein are attached hereto
and incorporated by reference.

            43.4. EXECUTED COPY. Any fully executed copy of this Lease shall be
deemed an original for all purposes.

            43.5. BINDING EFFECT. The covenants and agreements contained in this
Lease shall be binding on the parties hereto and on their respective successors
and permitted assigns.

            43.6. ENTIRE AGREEMENT. This Lease is the entire agreement between
the parties, and there are no agreements or representations between the parties
except as expressed herein.

            43.7 TIME OF THE ESSENCE. Time is of the essence for the performance
of each term, condition and covenant of this Lease.

            43.8 MORTGAGEE APPROVAL AND MODIFICATION. Tenant acknowledges that
Landlord's Mortgagee may have a right of approval of this Lease and/or may
require various changes in the terms of this Lease. Tenant agrees to cooperate
and act in good faith in agreeing to such changes in this Lease by written
amendment to this Lease which are required by a Mortgagee, provided that such
changes do not materially affect the Tenant's rental cost hereunder or change
the term hereby demised and provided that such requested changes are of a nature
reasonably necessary to protect such Mortgagee's security in accordance with
usual lending practices. In the event that Tenant shall not agree to a change
requested the Mortgagee, then Landlord shall have the right, upon thirty (30)
days notice to Tenant, to terminate this Lease and all of Tenant's rights
hereunder, and shall refund to Tenant such funds as Tenant may have paid on
account of future rent.

                                       34
<PAGE>

            43.9 NAME OF BUILDING. The Building may be designated and known by
any name Landlord may choose and such name may be changed from time to time at
Landlord's sole discretion.

            43.10 DOCUMENT INTERPRETATION. All references in the singular or
plural number shall be deemed to have been made, respectively, in the plural or
singular number as well.

            43.11 LANDLORD ENFORCEMENT. Tenant shall pay upon demand all of
Landlord's costs, charges and expenses, including the fees and out-of-pocket
expenses of counsel, agents and others retained by Landlord, incurred in
enforcing Tenant's obligations hereunder or incurred by Landlord in any
litigation, negotiation or transaction in which Tenant causes Landlord without
Landlord's fault to become involved or concerned.

            43.12 TRIAL BY JURY. It is mutually agreed by and between Landlord
and Tenant that they hereby waive trial by jury in any action, proceeding or
counterclaim brought by either of the parties hereto against the other on any
matter whatsoever arising out of or in any way connected with this Lease, the
relationship of Landlord and Tenant, Tenant's use or occupancy of the Leased
Premises or claim of injury or damage.

            43.13 RULES AND REGULATIONS. Such rules and regulations concerning
the Building and/or the Leased Premises as may from time to time be made by
Landlord in the exercise of Landlord's reasonable judgment upon written notice
to Tenant, shall be deemed a part of this Lease with the same effect as though
written herein, and Tenant also covenants that all such rules and regulations
will be faithfully observed by Tenant, Tenant's employees, and all those
visiting the Leased Premises or claiming under Tenant.

                                       35
<PAGE>

      WITNESS the execution of this Lease under seal by the parties hereto as of
the date first above written.

                                            CENTERPOINT 800 LLC
                                            Landlord

                                            By: /s/ Paul M. McConnell     (Seal)
                                                --------------------------
                                                    Paul M. McConnell
                                                    Managing Member

                                            INNOTRAC CORPORATION
                                            Tenant

                                            By: /s/ David Gamsey          (Seal)
                                                --------------------------
                                                    David Gamsey

                                            Title: Chief Financial Officer

                                            Attest: [ILLEGIBLE]

                                            Title: VP of logistics

                                       36
<PAGE>

                                   EXHIBIT "A"

                                    SITE PLAN

<PAGE>

                                    EXHIBIT A
                                 LEASED PREMISES
                                    75,000 SF

                                  [FLOOR PLAN]

<PAGE>

                                    EXHIBIT A

                                  [FLOOR PLAN]

<PAGE>

                                   EXHIBIT "B"

                                LEGAL DESCRIPTION
<PAGE>
                                  EXHIBIT "B"

                                  [ILLEGIBLE]

                                       35
<PAGE>

Parcels 2A, 2C, 3, 4, 5A, Private Open Space and Airport Holdings Parcel,
Centerpoint Business Park, dated December 29, 1998 and recorded January 22, 1999
in the Office of the Recorder of Deeds in and for New Castle County and State of
Delaware at Microfilm No. 13752, and being more particularly bounded and
described as follows, to-wit:

Beginning at a new common corner for Parcel 3A and 4A, said point being a common
corner for Parcel 3A and lands herein being described and located the following
eleven courses and distances from the southeasterly end of a fillet joining the
southerly side of Delaware Route 273(80 feet wide) with the westerly side of
Centerpoint Boulevard (60 feet wide):

(1)   South 08 degrees 19 minutes 11 seconds West, 307.47 feet to a point of
      curvature; thence,

(2)   By an arc curving to the right having a radius of 437.27 feet, an arc
      distance of 271.80 feet to a point of compound curvature; thence,

(3)   By an arc curving to the right having a radius of 532.68 feet, an arc
      distance of 224.31 feet to a point of tangency; thence,

(4)   South 68 degrees 03 minutes 43 seconds West, 881.67 feet to a point of
      curvature; thence,

(5)   Crossing Centerpoint Boulevard. South 21 degrees 56 minutes 17 seconds
      East, 60.00 feet to a point on the southerly side of Centerpoint
      Boulevard; thence, with same,

(6)   By an arc curving to the left having a radius of 1722.54 feet, an arc
      distance of 464.27 feet to a point of reverse curvature; thence,

(7)   By an arc curving to the right having a radius of 530.00 feet, an arc
      distance of 273.89 feet to a point of reverse curvature; thence,

(8)   By an arc curving to the left having a radius of 23.00 feet, an arc
      distance of 20.73 feet to a point of reverse curvature; thence,

(9)   By an arc curving to the right having a radius of 70.00 feet, an arc
      distance of 86.62 feet to a common corner for Parcels 3A and 4A; thence,
      with same the next two courses and distances.

(10)  South 29 degrees 46 minutes 49 seconds West, 32.64 feet to a point;
      thence,

(11)  South 00 degrees 30 minutes 53 seconds East, 586.52 feet to the Point of
      Beginning.

Thence, from said Point of Beginning the following five courses and distances:

(1)   South 00 degrees 30 minutes 53 seconds East, 100.00 feet to a point in
      line of lands now [ILLEGIBLE] formerly of the Delaware Division of
      P.B.&W.R.R. (70 feet wide); thence, with same the next two courses and
      distances,

(2)   South 88 degrees 57 minutes 28 seconds West, 275.71 feet to a point of
      curvature; thence,

(3)   By an arc curving to the left having a radius of 11499.14 feet, an arc
      distance of 287.11 feet to a new corner for the aforesaid Parcel 4A;
      thence, with the same the next two courses and distances,

(4)   North 02 degrees 28 minutes 14 seconds West, 103.61 feet to a point:
      thence,

(5)   North 88 degrees 57 minutes 28 seconds East, 566.30 feet to the Point of
      Beginning.

Containing within said metes and bounds 1.3040 acres of land, be they the same,
more or less.

      BEING the same lands and premises which Centerpoint 600, LLC, by Deed
dated February__, 1999 and recorded in the Office of the Recorder of Deeds
aforesaid prior hereto, or intended so to be, did grant and convey unto
Centerpoint 800, LLC.

EXCEPTING THEREOUT AND THEREFROM the following described parcel...

      ALL that certain piece, parcel or tract of land, with the improvements
thereon, situate in the City of New Castle. New Castle County and State of
Delaware, being known as a portion of Parcel 3 as shown on that certain Record
Minor Subdivision Plan of Parcels 2A, 2C, 3, 4, 5A, Private Open Space and
Airport Holdings Parcel, Centerpoint Business Park, dated December 29, 1998 and
recorded January 22, 1999 in the Office of the Recorder of Deeds in and for New
Castle County and State of Delaware at Microfilm No-13752, and being more
particularly bounded and described as follows, to-wit:

Beginning at a new common corner for Parcel 3A and Parcel 5D, said point being a
common corner for Parcel 5D and lands herein being described and located the
following seven courses and distances from the southeasterly end of a fillet
joining the southerly side of Delaware Route 273 (80 feet wide) with the
westerly side of Centerpoint Boulevard (60 feet wide);

(1)   South 08 degrees 19 minutes 11 seconds West, 307.47 feet to a point of
      curvature; thence,

(2)   By an arc curving to the right having a radius of 437.27 feet, an arc
      distance of 271.80 feet to a point of compound curvature; thence,

(3)   By an arc curving to the right having a radius of 532.68 feet, an arc
      distance of 224.31 feet to a point of tangency; thence,

                                  Page 2 of 4

<PAGE>

(4)   South 88 degrees 03 minutes 43 seconds West, 881.67 feet to a point of
      curvature; thence,

(5)   Crossing Centerpoint Boulevard, South 21 degrees 56 minutes 17 seconds
      East, 60.00 feet to a point on the southerly side of Centerpoint
      Boulevard; thence, with same,

(6)   By an arc curving to the left having a radius of 1722.54 feet, an arc
      distance of 379.83 feet to a common corner for the aforesaid Parcels 3A
      and 5D; thence, with same,

(7)   South 23 degrees 56 minutes 17 seconds East, 143.94 feet to a point feet
      to the Point of Beginning.

Thence, from said Point of Beginning the following six courses and distances:

(1)   South 23 degrees 56 minutes 17 seconds East, 259.60 feet to a point;
      thence,

(2)   South 01 degree 02 minutes 32 seconds East, 307.97 feet to a point in line
      of Private Open Space (see plan at Microfilm No. 13076): thence, with
      same, the next two courses and distances.

(3)   South 88 degrees 57 minutes 28 seconds West, 80.00 feet to a point;
      thence,

(4)   South 01 degree 02 minutes 32 seconds East, 225.00 feet to a point in line
      of lands now or formerly of the Delaware Division of P.B.&W.R.R; thence,
      with same,

(5)   South 88 degrees 57 minutes 28 seconds West, 21.00 feet to a corner for
      the aforesaid Parcel 3A; thence, with same,

(6)   North 01 degree 02 minutes 32 seconds East, 772.12 feet to the Point of
      Beginning.

Containing within said [ILLEGIBLE] and bounds 1.0998 acres of land, be they the
same, more or less.

      BEING the same lands and premises which Centerpoint 800, LLC, by Deed
dated February __, 1999 and recorded in the Office of the Recorder of Deeds
aforesaid prior hereto, or intended so to be, did grant and convey unto
Centerpoint 1000, LLC.

SAID LANDS NOW BEING DESCRIBED AS A SINGLE LOT, PIECE OR PARCEL AS...

ALL that certain piece, parcel or [ILLEGIBLE] of land, with the improvements
thereon, situate in the City of New Castle, New Castle County and State of
Delaware, commonly known as 800 Centerpoint Boulevard, being designated as
Parcel 3A on that certain Record Minor Subdivision Plan of Parcels 2A, 2C, 3, 4,
5A. Private Open Space and Airport Holdings Parcel, Centerpoint Business Park,
dated December 29, 1998 and recorded January 22, 1999 in the Office of the
Recorder of Deeds in and for New Castle County, State of Delaware, at Microfilm
No. 13752, and being more particularly bounded and described in accordance with
a survey titled "Plan of 800 Centerpoint Boulevard, also known as Parcel 3A,
Centerpoint Business Complex prepared tor Centerpoint 800, LLC" (Drawing No.
9803389-5004) by McBride & [ILLEGIBLE], Inc., Land Surveyors, Planners &
Engineers, dated February 4, 1999, as follows, to-[ILLEGIBLE]

Beginning at a point on the southeasterly side of Centerpoint Boulevard (60 feet
wide), said point being a common corner for Parcel 5D and lands herein being
described and located the following six courses and distances from the
southeasterly end of a fillet joining the southerly side of Delaware Route 273
(80 feet wide) with the westerly side of Centerpoint Boulevard (60 feet wide):

(1)   South 08 degrees 19 minutes 11 seconds West, 307.47 feet to a point of
      curvature; thence,

(2)   By an arc curving to the right having a radius of 437.27 feet, an arc
      distance of 271.80 feet to a point of compound curvature; thence,

(3)   By an arc curving to the right having a radius of 532.68 feet, an arc
      distance of 224.31 feet to a point of tangency; thence.

(4)   South 68 degrees 03 minutes 43 seconds West, 881.67 feet to a point of
      curvature; thence,

(5)   Crossing Centerpoint Boulevard, South 21 degrees 56 minutes 17 seconds
      East, 60.00 feet to a point on the southerly side of Centerpoint
      Boulevard; thence, with same.

(6)   By an arc curving to the left having a radius of 1722.54 feet, an arc
      distance of 379.83 feet to the Point of Beginning.

Thence, from said Point of Beginning the following twelve courses and distances:

(1)   South 23 degrees 56 minutes 17 seconds East, 143.94 feet to a point;
      thence

(2)   South 01 degree 02 minutes 32 seconds East, 772.12 feet to a point in line
      of lands now or formerly of the Delaware Division of P.B.&W.R.R.; thence,
      with same the next two courses and distances,

(3)   South 68 degrees 57 minutes 28 seconds West, 767.58 feet to a point of
      curvature; thence,

(4)   By an arc curving to the left having a radius of 11499.14 feet, an arc
      distance of 287.11 feet to a corner for Parcel 4A; thence, with same the
      next four courses and distances,

(5)   North 02 degrees 28 minutes 14 seconds West, 103.61 feet to a point;
      thence

(6)   North 88 degrees 57 minutes 28 seconds East, 566.30 feet to a point;
      thence,

(7)   North 00 degrees 30 minutes 53 seconds west, 586.52 feet to a point;
      thence,

                                  Page 3 of 4

<PAGE>

(8)   North 29 degrees 46 minutes 49 seconds East. 32.64 feet to a point on the
      cul-de-sac at the end of Centerpoint Boulevard; thence [ILLEGIBLE] with
      same the next four courses and distances.

(9)   By an arc curving to the left having a radius of 70.00 feet, an arc
      distance of 86.62 feet to a point of reverse curvature: thence,

(10)  By an arc curving to the right having a radius of 23.00 feet, an arc
      distance of 20.73 feet to a point of reverse curvature: thence.

(11)  By an arc curving to the left having a radius of 530.00 feet, an arc
      distance of [ILLEGIBLE] feet to a point of reverse curvature; thence.

(12)  By an arc curving to the right having a radius of 1722.54 feet, an arc
      distance of 84.44 feet to the Point of Beginning.

Containing within said metes and bounds 10.23 acres of land, be they the same.
more or less.

      TOGETHER WITH the non-exclusive right in and to the use of an irregular
shaped cross access easement leading from the hereinabove described property
over a portion of Parcel 5D and Parcel 4 to Centerpoint Boulevard as
shown on the aforementioned Record Plan (Microfilm No. 13752).

      UNDER AND SUBJECT to all applicable covenants. conditions. easements,
rights-of-way, reservations, restrictions, and agreements of record in the
Office of the Recorder of Deeds aforesaid including, but not limited to, the
Record Minor Subdivision Plan of Parcels 2A, 2C, 3, 4, 5A, Private
Open Space and Airport Holdings Parcel, Centerpoint Business Park, dated
December 29, 1998 and recorded January 22, 1999 at Microfilm No. 13752.

      This Deed is a confirmatory Deed intended to create of record the current
metes and bounds description for Parcel 3A in the Centerpoint Business Complex
as established and shown on the aforementioned Record Minor Subdivision Plan of
record in the Office of the Recorder of Deeds aforesaid at Microfilm No. 13752.

      IN WITNESS WHEREOF, the said Centerpoint 800, LLC has caused its name by
Paul M. McConnell, its Member to be hereunto set, the day and year first above
written.

Signed, Sealed, and Delivered
  in the Presence of:                           CENTERPOINT 800. LLC

/s/ [ILLEGIBLE]                                 By: /s/ Paul M. McConnell
------------------------------                      ---------------------------
                                                    Officer: Paul M. McConnell
                                                    Title: Member

STATE OF DELAWARE, COUNTY OF NEW CASTLE; SS.

      BE IT REMEMBERED, That on this 22nd day of February, 1999, personally came
before me, the Subscriber, a Notary Public for the State and County aforesaid,
Paul M. McConnell, Member of Centerpoint 800, LLC, a Delaware limited liability
company, party to this indenture, known to me personally to be such, and
acknowledged this Indenture to be his duly authorized act and deed for and on
behalf of said company.

      GIVEN under my Hand and Seal of Office, the day and year aforesaid.

                                               /s/ DONALD NELSON ISKEN
                                               ------------------------
                                               NOTARY PUBLIC
                                               Notary: Print Name and
                                               Date Commission Expires

                                                DONALD NELSON ISKEN
GRANTEE'S ADDRESS                               Notary Public, State of Delaware
                                                [ILLEGIBLE]
4001 Kennett Pike
Suite 222
Greenville, DE 19807
<PAGE>

                                   EXHIBIT "C"

                               TENANT IMPROVEMENTS

                              (PLAN TO BE ATTACHED)

Landlord shall, at Landlord's sole cost and expense, do the following work to
Leased Premises:

      (A) Remove areas noted on attached plan Area A and B. Landlord shall
remove drywall, carpet, electric and other fit-out currently noted in Area A and
B upon the request of Tenant. Landlord shall return both areas to be in a
warehouse shell condition. Any current demising walls in warehouse, including
but not limited to walls separating climate control area, wall separating the
existing tenant, or any wall separating unused space, and walls adjacent to
office area, shall removed upon Tenant's taking of additional space.

      (B) Upon request of Tenant, Landlord shall construct four (4) offices and
one (1) conference room using building standard finishes in Area C with
dimensions as noted on attached Plan and demolish remaining office area.

      (C) Landlord shall paint office break room and restrooms noted as Area D
on attached plan.

      (D) Landlord shall have the HVAC system inspected and repaired prior to
the Term.

      (E) Tenant shall have right to park cars in areas noted on Exhibit J.
Tenant shall have exclusive truck dock use for truck docks that are part of
Leased Premises.

      (F) Landlord shall at Landlord's option and sole cost and expense have the
right to remove existing warehouse air conditioning units and electrical
bus-duct.

      (G) Tenant shall install such aisle lighting in the Leased Premises as
necessary in order to provide adequate visibility for Tenant's use of the Leased
Premises. Landlord shall provide up to ten thousand dollars ($10,000) towards
lighting upgrades. Tenant shall provide Landlord with invoices outlining
expenditures. Landlord shall reimburse Tenant within thirty (30) days of receipt
of invoice.

<PAGE>

                                    EXHIBIT C

                                  [FLOOR PLAN]

<PAGE>

                                   EXHIBIT "D"

                                HVAC REQUIREMENTS

      The following work will be required in accordance with the maintenance
contract required in Paragraph 12B of the attached Lease:

            1.    Check performance of all major components.

            2.    Lubricate moving parts as required.

            3.    Check refrigerant charges (during cooling season).

            4.    Inspect for oil and refrigerant leaks.

            5.    Check operating and safety controls.

            6.    Check pressures and temperatures.

            7.    Inspect condensers.

            8.    Inspect fans, motors, and starters.

            9.    Tighten electrical connections at equipment.

            10.   Test amperages and voltages.

            11.   Check belts and drives.

            12.   Check oil and filters, or dryers, as required (at least four
                  times per year).

            13.   Check temperature on control system.

            14.   Thoroughly inspect heat exchanger.

<PAGE>

                                   EXHIBIT "E"

             ESTIMATED 2004 TAXES, INSURANCE AND OPERATING EXPENSES

                  Building: 800 Centerpoint Boulevard 2004 CAM
                                 179,466 Sq. Ft.

<TABLE>
<CAPTION>
                                            $/sq. ft
                                            --------
<S>                                         <C>
HVAC Maintenance                              $0.02

Insurance                                     $0.15

Management                                    $0.15

Misc./Maint./Repairs                          $0.01

Administrative Charges                        $0.05

Landscaping/Grounds Maintenance               $0.03

Snow Removal                                  $0.09

Sprinkler / Fire Protection                   $0.02

Taxes                                         $0.41

Water & Sewer                                 $0.02
                                              -----
   TOTAL                                      $0.95
                                              =====
</TABLE>

<PAGE>

                                    EXHIBIT F

                          RELOCATION OF EXISTING TENANT

Provided no event of Default exists under the Lease Agreement, Landlord agrees
to relocate tenant, Emile Henry, ("Existing Tenant") presently occupying 44,044
square feet and not actively lease the balance of the Premises ("Adjacent
Space") under the following terms and conditions:

Existing Tenant Relocation:

      A)    Tenant shall provide five (5) months written notice that Tenant
            wants Landlord to relocate Existing Tenant.

      B)    Relocation of Existing Tenant can only occur between December 18 and
            May 31 of any given year.

      C)    Tenant shall have leased the balance of Building prior to being able
            to exercise Existing Tenant Relocation.

      D)    Tenant shall commence paying rent on space vacated by Existing
            Tenant immediately upon Existing Tenant's vacation of 44,044 square
            feet.

      E)    The Lease shall automatically extend through the then current Term
            or Renewal Term, by three (3) years from the then current
            Termination Date of the Lease or any amendments to Lease.

      F)    Landlord shall deliver Premises in its "As Is, Where Is" condition,
            broom clean.

      G)    Tenant shall have a one (1) time termination option ("Termination
            Option") only if Tenant has exercised the Relocation of Existing
            Tenant. Tenant shall:

            (i)   Provide Landlord with sixty (60) days termination written
                  notice ("Termination Notice");

            (ii)  Provide Landlord with a payment of One Hundred Fifty Thousand
                  Dollars ($150,000) at the time of Termination Notice.

            (iii) Tenant shall only be permitted to terminate the Leased
                  Premises which was part of Existing Tenant Premises.

            (iv)  Tenant shall vacate the Leased Premises terminated and return
                  Leased Premises to Landlord in condition provided for in the
                  Lease.

Adjacent Space:

      A)    Landlord agrees not to actively market the adjacent vacant 33,500
            square feet for a period of five (5) months from the Rent
            Commencement Date.

                                        2
<PAGE>

      B)    After the five (5) month time frame, Landlord is free to market
            space. Except Tenant shall have an On-going Right of First Offer on
            contiguous space per Exhibit G.

      C)    If Tenant expands during the initial five (5) month period, Landlord
            and Tenant shall immediately execute an amendment to lease stating
            the new rentable square footage and the new expiration date for the
            entire Leased Premises shall be extended through the then current
            Term or Renewal Term, in conjunction with the Leased Premises.

                                        3
<PAGE>

                                    EXHIBIT G

                          ON-GOING RIGHT OF FIRST OFFER

Provided no event of Default exists under the Lease agreement, Landlord shall
provide Tenant with the On-Going Right of First Offer on contiguous space
occupied by Tenant under the following terms and conditions:

      A)    Landlord shall present Tenant with any written offer that has been
            presented to Landlord, in writing, specifying the square footage and
            rate per square foot. Landlord shall then provide Tenant with Right
            of First Offer on contiguous space occupied by Tenant. Such Right of
            First Offer shall be at Tenant's then current Basic Rental Rate.
            Tenant shall have a period of twenty (20) days to accept or reject
            space outlined in offer from Landlord.

      B)    If Tenant accepts offer, Landlord and Tenant shall immediately
            execute an amendment to Lease outlining the Rent Commencement Date,
            an amendment to this Lease that extends the term of the contiguous
            space through the then current Expiration Date of Lease or any
            amendments to Lease, in conjunction with the Leased Premises. All
            other terms of the Lease shall remain in full force and effect.

                                        4
<PAGE>

                                    EXHIBIT H

                   EXPANSION BASIC RENTAL RATE, RENEWAL OPTION

The Basic Rental Rate shall apply to the spaces taken during any expansion or
extension of Lease during the Term of this Agreement.

EXPANSION BASIC RENTAL RATES shall apply as follows:

Year 1        $ 3.75 per square foot, NNN
Year 2        $ 3.85 per square foot, NNN
Year 3        $ 3.95 per square foot, NNN
Year 4        $ 4.05 per square foot, NNN
Year 5        $ 4.15 per square foot, NNN
Year 6        $ 4.25 per square foot, NNN
Year 7        $ 4.35 per square foot, NNN
Year 8        $ 4.40 per square foot, NNN
Year 9        $ 4.40 per square foot, NNN

Any expansion beyond Year Nine (9) shall be fixed at Four Dollars and Forty
Cents ($4.40) per square foot, NNN.

RENEWAL OPTION

      A)    In the event Lease expires for the Leased Premises, the Landlord
            shall provide Tenant with the option to exercise two (2) renewal
            terms: one renewal term of one (1) year immediately following the
            Termination Date and subsequently one renewal term of three (3)
            years following the expiration of the initial renewal term of 1 year
            (collectively "Renewal Term(s)"). Such Renewal Terms shall be at a
            fixed Basic Rental Rate of Four Dollars and Forty Cents ($4.40) per
            square foot, NNN.

      B)    Tenant shall provide six (6) months written notice to Landlord of
            Tenant's exercise of Renewal Option.

      C)    If Tenant does not provide written notice to Landlord in the above
            time frame, Tenant shall loose all rights to renew the Lease for the
            Leased Premises.

                                        5
<PAGE>

                                    EXHIBIT I

                                 SIGN LOCATIONS

                                        6
<PAGE>

                                    EXHIBIT I

                                  [FLOOR PLAN]

<PAGE>

                                    EXHIBIT I

                                  [FLOOR PLAN]

<PAGE>

                                    EXHIBIT J

                                 PARKING SPACES

                                        7

<PAGE>

                                    EXHIBIT J

                                  [FLOOR PLAN]<PAGE>
                                                                    Exhibit 10.1

                              EMPLOYMENT AGREEMENT

         THIS EMPLOYMENT AGREEMENT (this "Agreement") is made and entered into
by and between PEDIATRIX MEDICAL GROUP, INC., a Florida corporation,
("Employer") and ROGER J. MEDEL, M.D., M.B.A. ("Employee") effective as of the
11th day of November, 2004.

                                    RECITALS

         WHEREAS, Employer is presently engaged in "Employer's Business" as
defined on Exhibit A hereto; and

         WHEREAS, Employee has experience providing management services in
Employer's Business or in fields relating to Employer's Business; and

         WHEREAS, Employer and Employee previously entered into an Amended and
Restated Employment Agreement effective as of April 1, 2003 (the "Prior
Employment Agreement"), which will be cancelled in its entirety with the
execution of this Agreement; and

         WHEREAS, Employer desires to employ Employee as an executive officer of
Employer and benefit from Employee's contributions to Employer; and

         WHEREAS, in order to induce Employer to enter into this Agreement on
the terms and conditions set forth herein (including an increase in compensation
over what was provided under the Prior Employment Agreement), and disclose its
trade secrets and confidential information in connection with Employee's
employment by Employer and provide incentive compensation from time to time,
Employee hereby agrees to be bound by the terms of this Agreement, including the
arbitration, non-competition and related restrictive covenants set forth herein.

         NOW, THEREFORE, in consideration of the premises and mutual covenants
set forth herein, the parties agree as follows:

         1. EMPLOYMENT.

                  1.1. EMPLOYMENT AND TERM. Employer hereby agrees to employ
Employee and Employee hereby agrees to serve Employer on the terms and
conditions set forth herein for an "Initial Term" commencing January 1, 2004
(the "Effective Date") and continuing for a period of five (5) years, unless
sooner terminated in accordance with the provisions of Section 4. Thereafter,
the employment of Employee hereunder shall automatically renew for successive
one (1) year periods until terminated in accordance with the provisions of
Section 4 of this Agreement. In this Agreement, the term "Employment Period"
shall refer to the period of time that this Agreement is in effect and ending on
the termination date as determined in accordance with the provisions of Section
4 of this Agreement.

                  1.2. DUTIES OF EMPLOYEE. During the Employment Period,
Employee shall serve as President and Chief Executive Officer of Employer and
perform such duties as are customary to the

<PAGE>

position Employee holds or as may be reasonably assigned to Employee from time
to time by Employer's Board of Directors ("Employee's Supervisor"); PROVIDED,
that such duties as assigned shall be customary to Employee's role as an
executive officer of Employer. Employee's employment shall be full-time and as
such Employee agrees to devote substantially all of Employee's attention and
professional time to the business and affairs of Employer. During the Employment
Period, Employer shall promote the proficiency of Employee by, among other
things, providing Employee with Confidential Information, specialized
professional development programs, and information regarding the organization,
administration and operation of Employer. During the Employment Period, Employee
agrees that Employee will not, without the prior written consent of Employer
(which consent shall not be unreasonably withheld), serve as a director on a
corporate board of directors or in any other similar capacity for any
institution other than Employer. During the Employment Period, it shall not be a
violation of this Agreement to (i) serve on civic or charitable boards or
committees, or (ii) deliver lectures, fulfill speaking engagements or teach at
educational institutions, so long as such activities do not interfere with the
performance of Employee's responsibilities as an employee of Employer in
accordance with this Agreement, including the restrictions of Section 8 hereof.

                  1.3. PLACE OF PERFORMANCE. Employee shall be based at
Employer's offices located in Sunrise, Florida, except for required travel
relating to Employer's Business.

         2. BASE SALARY AND PERFORMANCE BONUS.

                  2.1. BASE SALARY. Employee shall be paid an annual base salary
of Six Hundred Seventy-Five Thousand Dollars ($675,000.00) (the "Base Salary"),
payable in installments consistent with Employer's customary payroll schedule
and subject to applicable withholding for taxes and Employee directed
withholdings. The Compensation Committee of the Board of Directors of Employer
(the "Compensation Committee") shall review the amount of Employee's Base Salary
on an annual basis no later than ninety (90) days after the beginning of the
Employer's fiscal year. Any change to Employee's Base Salary that is approved by
the Compensation Committee shall become the Base Salary for purposes of this
Agreement.

                  2.2. PERFORMANCE BONUS. Employee shall be eligible for an
annual bonus (the "Performance Bonus") in accordance with incentive programs
approved from time to time by the Compensation Committee, which programs shall
contemplate a target bonus payment of at least One Hundred Percent (100%) of
Employee's Base Salary upon the fulfillment of reasonable performance objectives
set by the Compensation Committee. If earned, the Performance Bonus shall be
paid to Employee no later than ninety (90) days after the end of Employer's
fiscal year.

                                       2
<PAGE>

         3. BENEFITS.

                  3.1. EXPENSE REIMBURSEMENT. Employer shall promptly reimburse
Employee for all out-of-pocket expenses reasonably incurred by Employee on
behalf of or in connection with Employer's Business pursuant to the
reimbursement standards and guidelines of Employer in effect from time to time.
Employee shall account for such expenses and submit reasonable supporting
documentation to Employer in accordance with Employer's policies in effect from
time to time.

                  3.2. EMPLOYEE BENEFITS. During the Employment Period, Employee
shall be entitled to participate in such health, welfare, disability, stock
purchase, retirement savings and other fringe benefit plans and programs as may
be established and maintained by Employer from time to time to the extent that
such plans and programs are applicable to other similarly situated employees of
Employer and subject to the provisions of such plans and programs.

                  3.3. LEAVE TIME. During the Employment Period, Employer shall
allow Employee paid leave time each year for vacation, illness, injury or other
similar purposes in accordance with Employer's policies in effect from time to
time, but in no event less than six (6) weeks per calendar year (prorated for
periods of less than a calendar year). Any leave time not used during each
calendar year may be carried over into the next year to the extent permitted by
Employer's policies in effect from time to time.

                  3.4. INCENTIVE COMPENSATION PLAN. Employee shall be eligible
to participate in Employer's 2004 Incentive Compensation Plan or any other
similar plan adopted by Employer that provides for the issuance of stock
options, restricted stock and other awards to its employees. Employee's stock
based award each year shall be determined by the Compensation Committee based on
Employee's performance and the Company's performance during the immediately
preceding year and shall be consistent with the Compensation Committee's
determination of Employee's stock based award in prior years. The terms of any
award to Employee and Employee's rights and interest in any such award shall be
controlled by this Agreement, and the 2004 Incentive Compensation Plan or such
other plan then in effect. Employee acknowledges that this Section 3 is
sufficient consideration for Employee to enter into this agreement, including
the restrictive covenants set forth in Section 8 below.

                  3.5. PERSONAL USE OF CORPORATE AIRCRAFT. Corporate aircraft
may be used by Employee for personal matters; PROVIDED, HOWEVER, (i) the
aircraft is not being used, nor during the period Employee has requested use for
personal matters will it be needed for use, by Employer for business-related
matters, as Employer shall have priority over Employee's personal use; and (ii)
Employee's personal use of the aircraft does not exceed a total of seventy-five
(75) hours of flight in any calendar year without the advance approval of the
Compensation Committee. Such personal use of the aircraft by Employee shall be
treated as imputed income to Employee in accordance with rules and regulations
of the Internal Revenue Code of 1986, as amended.

                                       3
<PAGE>

         4. TERMINATION.

                  4.1. TERMINATION FOR CAUSE. Employer may terminate this
Agreement for Cause. As used in this Agreement, the term "Cause" shall mean:

                  (a) Any act or omission of Employee, which is materially
         contrary to the business interests, reputation or goodwill of Employer;

                  (b) A material breach by Employee of Employee's obligations
         under this Agreement, which breach is not promptly remedied upon
         written notice from Employer;

                  (c) Employee's failure or refusal to perform Employee's duties
         in any material respect as reasonably assigned pursuant to this
         Agreement, other than a failure or refusal which is remedied by
         Employee promptly after receipt of written notice thereof by Employer;
         or

                  (d) Employee's failure or refusal to comply with a reasonable
         policy, standard or regulation of Employer in any material respect,
         including but not limited to Employer's sexual harassment, other
         unlawful harassment, workplace discrimination or substance abuse
         policies.

The termination date for a termination of this Agreement pursuant to this
Section 4.1 shall be the date specified by Employer in a written notice to
Employee of finding of Cause, which may not be retroactive. Upon any termination
of this Agreement pursuant to this Section 4.1, Employee shall be entitled to
compensation in accordance with, and subject to, the provisions of Section 5.1
hereof.

                  4.2. DISABILITY. Employer may terminate this Agreement upon
the Disability (as defined below) of Employee. Subject to the requirements of
applicable law, Employee shall be deemed to have a "Disability" for purposes of
this Agreement in the event of (i) Employee's inability to perform Employee's
duties hereunder, with or without a reasonable accommodation, as a result of
physical or mental illness or injury, and (ii) a determination by an independent
qualified physician selected by Employer and acceptable to Employee (which
acceptance shall not be unreasonably withheld) that Employee is currently unable
to perform such duties and in all reasonable likelihood such inability will
continue for a period in excess of an additional ninety (90) or more days in any
one hundred twenty (120) day period. The termination date for a termination of
this Agreement pursuant to this Section 4.2 shall be the date specified by
Employer in a notice to Employee, which date shall not be retroactive. Upon any
termination of this Agreement pursuant to this Section 4.2, Employee shall be
entitled to compensation and/or benefits in accordance with, and subject to, the
provisions of Section 5.2 hereof.

                  4.3. DEATH. This Agreement shall terminate automatically upon
the death of Employee, without any requirement of notice by Employer to
Employee's estate. The date of Employee's death shall be the termination date of
this Agreement pursuant to this Section 4.3. Upon any termination of this
Agreement pursuant to this Section 4.3, Employee shall be entitled to the
compensation specified in Section 5.3 hereof.

                                       4
<PAGE>

                  4.4. TERMINATION BY EMPLOYER WITHOUT CAUSE. Employer may
terminate Employee's employment without cause by giving Employee written notice
of such termination. The termination date shall be the date specified by
Employer in such notice, which shall not be less than ninety (90) days from the
date of written notice to Employee. Upon any termination of this Agreement
pursuant to this Section 4.4, Employee shall be entitled to compensation and/or
benefits in accordance with, and subject to, the provisions of Section 5.4
hereof.

                  4.5. TERMINATION BY EMPLOYEE DUE TO POOR HEALTH. Employee may
terminate Employee's employment under this Agreement upon written notice to
Employer if Employee's health should become impaired to any extent that makes
the continued performance of Employee's duties under this Agreement hazardous to
Employee's physical or mental health or Employee's life (regardless of whether
such condition would be deemed a Disability under any other Section of this
Agreement), PROVIDED that Employee shall have furnished Employer with a written
statement from a qualified doctor to that effect, and PROVIDED FURTHER that, at
Employer's written request and expense, Employee shall submit to a medical
examination by an independent qualified physician selected by Employer and
acceptable to Employee (which acceptance shall not be unreasonably withheld),
which doctor shall substantially concur with the conclusions of Employee's
doctor. The termination date shall be ninety (90) days from Employer's receipt
of such notice. Upon any termination of this Agreement pursuant to this Section
4.5, Employee shall be entitled to compensation and/or benefits in accordance
with, and subject to, the provisions of Section 5.5 hereof.

                  4.6. TERMINATION BY EMPLOYEE. Employee may terminate
Employee's employment under this Agreement for any reason whatsoever upon not
less than ninety (90) days prior written notice to Employer. Upon receipt of
such notice from Employee, Employer may, at its option, require Employee to
terminate employment at any time in advance of the expiration of such ninety
(90) day period. The termination date under this Section 4.6 shall be the date
specified by Employer, but in no event more than ninety (90) days after
Employer's receipt of notice from Employee as contemplated by this Section 4.6.
Upon any termination of this Agreement pursuant to this Section 4.6, Employee
shall be entitled to compensation and/or benefits in accordance with, and
subject to, the provisions of Section 5.6 hereof.

                  4.7. TERMINATION BY EMPLOYEE FOR GOOD REASON. Employee may
terminate Employee's employment hereunder for Good Reason. For purposes of this
Section, "Good Reason" shall mean:

                  (a) the assignment to Employee of any duties inconsistent in
         any material respect with the Employee's position (including status,
         offices, titles and reporting requirements), authority, duties or
         responsibilities as assigned by Employee's Supervisor, or any other
         action by Employer that results in a material diminution in such
         position, authority, duties or responsibilities, excluding for this
         purpose an isolated, insubstantial and inadvertent action not taken in
         bad faith and which is remedied by Employer promptly after receipt of
         written notice from Employee;

                                       5
<PAGE>

                  (b) any material failure by Employer to comply with its
         obligations to Employee as agreed upon (including under Sections 2.2
         and 3.4 hereof), other than an isolated, insubstantial and inadvertent
         failure not occurring in bad faith and which is remedied by Employer
         promptly after receipt of written notice from Employee;

                  (c) the requirement by Employer that Employee be based at any
         office or location outside of twenty-five (25) miles from the location
         of Employee's service as of the date hereof, except for travel
         reasonably required in the performance of the Employee's duties;

                  (d) a decrease in Employee's Base Salary or failure to award
         incentive compensation as contemplated by Section 3.4;

                  (e) the failure of Employer to set a Performance Bonus target
         in accordance with Section 2.2 or pay a Performance Bonus otherwise due
         to Employee;

                  (f) the termination by Employer of the employment of two (2)
         Key Executives within a one (1) year period or three (3) Key Executives
         within a two (2) year period. For purposes of this subsection , "Key
         Executives" shall refer to the individuals serving as Chief Executive
         Officer, President, Chief Financial Officer and General Counsel as of
         the date first written above; or

                  (g) a Change in Control of Employer. For purposes of this
         subsection, "Change in Control of Employer" shall mean (i) the
         acquisition by a person or an entity or a group of persons and
         entities, directly or indirectly, of more than fifty (50%) percent of
         Employer's common stock in a single transaction or a series of
         transactions (hereinafter referred to as a "50% Change in Control");
         (ii) a merger or other form of corporate reorganization resulting in an
         actual or DE FACTO 50% Change in Control; or (iii) the failure of
         Applicable Directors (defined below) to constitute a majority of
         Employer's Board of Directors (the "Board") during any two (2)
         consecutive year period after the date of this Agreement (the "Two-Year
         Period"). "Applicable Directors" shall mean those individuals who are
         members of the Board at the inception of the Two-Year Period and any
         new director whose election to the Board or nomination for election to
         the Board was approved (prior to any vote thereon by the shareholders)
         by a vote of at least two-thirds (2/3) of the directors then still in
         office who either were directors at the beginning of the Two-Year
         Period at issue or whose election or nomination for election during
         such Two-Year Period was previously approved as provided in this
         sentence.

If Employee desires to terminate this Agreement pursuant to this Section,
Employee must, within ninety (90) days after the occurrence of events giving
rise to the Good Reason, provide Employer with a written notice describing the
Good Reason in reasonable detail. Such notice shall include the proposed
termination date of this Agreement, which must be ninety (90) days from the date
of the notice. Upon receipt of such notice from Employee, Employer may, at its
option, require Employee to terminate employment at any time in advance of the
expiration of such ninety (90) day period. The termination date under this
Section 4.7 shall be the date specified by Employer, but in no event more than
ninety (90) days after Employer's receipt of notice from Employee as
contemplated by this

                                       6
<PAGE>

Section 4.7. If (i) Employee terminates this Agreement pursuant to this Section
4.7, or (ii) Employer terminates this Agreement for any reason within
twenty-four (24) months after a Change in Control of Employer, then Employee
shall be entitled to compensation and/or benefits in accordance with, and
subject to, the provisions of Section 5.7 hereof, but shall not be entitled to
compensation under any other subsection of Section 5 hereof.

         5. COMPENSATION AND BENEFITS UPON TERMINATION.

                  5.1. CAUSE. If Employee's employment is terminated for Cause,
Employer shall pay Employee's Base Salary through the termination date specified
in Section 4.1 at the rate in effect at the termination date. In addition, if
Employee's employment is terminated pursuant to Section 4.1(c), Employer shall
continue Base Salary payments to Employee for a period of twelve (12) months
after the termination date. Upon payment of such amounts, plus any amounts as
may be due under Section 5.9 below, Employer shall have no further obligation to
Employee under this Agreement.

                  5.2. DISABILITY. In the event of Employee's Disability,
Employee shall continue to receive Employee's Base Salary for the first ninety
(90) days of Disability. Thereafter, payments, if any, shall be administered
pursuant to Employer's sponsored long-term disability policy. If Employee's
employment is terminated pursuant to Section 4.2 in connection with Employee's
Disability, Employee shall receive any amounts payable under Section 5.9 hereof;
and, Employee shall also receive fifty percent (50%) of Employee's annual Base
Salary at the rate in effect at the termination date, payable in six (6) equal
monthly installments after the termination date, plus a bonus calculated in
accordance with Section 5.10 hereof. The six (6) month period after the
termination date during which Employee may continue to receive Base Salary
payments pursuant to this Section 5.2 shall be referred to as the "Severance
Period" for purposes of this Agreement.

                  5.3. DEATH. Upon Employee's death during the Employment
Period, Employer shall pay to the person or entity designated by Employee in a
notice filed with Employer or, if no person is designated, to Employee's estate
any unpaid amounts of Base Salary to the date of Employee's death, plus any
amounts as may be due under Sections 5.9 and 5.10 below. Any payments Employee's
spouse, beneficiaries or estate may be entitled to receive pursuant to any
pension plan, employee welfare benefit plan, life insurance policy, or similar
plan or policy then maintained by Employer shall be determined and paid in
accordance with the written instruments governing the respective plans and
policies. In the event of Employee's death during the Employment Period,
Employer shall notify Employee's designee or estate of the stock awards held by
Employee and the procedures pursuant to which all vested stock options may be
exercised and other stock awards may be realized under the terms applicable to
such awards.

                  5.4. TERMINATION BY EMPLOYER WITHOUT CAUSE. If Employer
terminates Employee's employment in accordance with Section 4.4, then (i)
Employer shall pay Employee's Base Salary through the termination date specified
in Section 4.4 at the rate in effect at such termination date, plus any amount
due under Section 5.9 hereof; and (ii) Employer shall (a) continue to pay
Employee's monthly Base Salary for a period of twenty-four (24) months after the
termination date, and (b) on the first (1st) and second (2nd) anniversaries of
the termination date, pay Employee an

                                       7
<PAGE>

amount equal to the lesser of Employee's Average Annual Performance Bonus (as
defined below) or Employee's bonus for the year immediately preceding Employee's
termination, and (c) pay Employee a bonus calculated in accordance with Section
5.10 hereof. The twenty-four (24) month period after the termination date during
which Employee may continue to receive Base Salary payments pursuant to this
Section 5.4 shall be referred to as the "Severance Period" for purposes of this
Agreement. For purposes of this Agreement, "Average Annual Performance Bonus"
shall be equal to the Employee's then applicable Base Salary multiplied by a
percentage obtained by averaging the quotients of the Performance Bonus paid to
Employee for the three (3) full calendar years prior to the termination date
divided by the Employee's Base Salary in effect for the calendar year for which
the Performance Bonus relates.

                  5.5. TERMINATION BY EMPLOYEE DUE TO POOR HEALTH. If Employee
terminates this Agreement pursuant to Section 4.5 hereof, Employer shall pay to
Employee any unpaid amounts of Base Salary to the termination date specified in
Section 4.5, plus any disability payments otherwise payable by or pursuant to
plans provided by Employer, plus any amounts as may be due under Section 5.9
hereof. Employer shall also pay Employee a bonus calculated in accordance with
Section 5.10 hereof.

                  5.6. TERMINATION BY EMPLOYEE. If this Agreement terminates
pursuant to Section 4.6 hereof, Employer shall pay to Employee any unpaid
amounts of Base Salary to the termination date specified in Section 4.6, plus
any amounts as may be due under Section 5.9 below. In the event that the
termination date specified by Employer is less than ninety (90) days after the
date of Employer's receipt of notice as contemplated by Section 4.6, then
Employer shall continue Employee's Base Salary for a period of days equal to
ninety (90) minus the number of days from Employee's notice to the termination
date.

                  In addition, if Employee gives Employer sufficient notice in
accordance with Section 4.6 and executes a general release of Employer that is
satisfactory to Employer, Employer shall pay Employee a bonus calculated in
accordance with Section 5.10 hereof.

                  5.7. TERMINATION BY EMPLOYEE FOR GOOD REASON. If this
Agreement is terminated in accordance with Section 4.7, then (i) Employer shall
pay Employee's Base Salary through the termination date specified in Section 4.7
at the rate in effect at such termination date, plus any amounts as may be due
under Section 5.9 hereof; and (ii) Employer shall (a) continue to pay Employee's
monthly Base Salary for a period of twenty-four (24) months after the
termination date; (b) on the first (1st) and second (2nd) anniversaries of the
termination date, pay Employee an amount equal to the lesser of Employee's
Average Annual Performance Bonus or Employee's bonus for the year immediately
preceding Employee's termination; PROVIDED, HOWEVER, that if this Agreement is
terminated in connection with a Change in Control of Employer, then Employer
shall make such Performance Bonus payments due to Employee under this Agreement
in a lump sum within ninety (90) days after termination of this Agreement; and
(c) pay Employee a bonus calculated in accordance with Section 5.10 hereof. The
twenty-four (24) month period after the termination date during which Employee
continues to receive Base Salary payments pursuant to this Section 5.7 shall be
referred to as the "Severance Period" for purposes of this Agreement.
Notwithstanding the

                                       8
<PAGE>

foregoing, if this Agreement is terminated in connection with a Change in
Control of Employer, the payments to Employee under this Section shall be
subject to the provisions of Section 5.8 below.

                  5.8. PAYMENTS IN THE EVENT OF A CHANGE IN CONTROL OF EMPLOYER.
In the event it shall be determined that any payment, distribution or other
action by Employer to or for the benefit of the Employee (whether paid or
payable or distributed or distributable pursuant to the terms of this Agreement
or otherwise, including any additional payments required under Section 5.7) (a
"Payment") would be subject to an excise tax imposed by Section 4999 of the
Internal Revenue Code of 1986, as amended (the "Code"), or any interest or
penalties are incurred by the Employee with respect to any such excise tax (such
excise tax, together with any such interest and penalties, are hereinafter
collectively referred to as the "Excise Tax"), Employer shall make a payment to
the Employee (a "Gross-Up Payment") in an amount such that after payment by the
Employee of all taxes (including any Excise Tax) imposed upon the Gross-Up
Payment, the Employee retains (or has had paid to the Internal Revenue Service
on his behalf) an amount of the Gross-Up Payment equal to the sum of (x) the
Excise Tax imposed upon the Payments and (y) the product of any deductions
disallowed because of the inclusion of the Gross-Up Payment in the Employee's
adjusted gross income and the highest applicable marginal rate of federal income
taxation for the calendar year in which the Gross-Up Payment is to be made. For
purposes of determining the amount of the Gross-Up Payment, the Employee shall
be deemed to (i) pay federal income taxes at the highest marginal rates of
federal income taxation for the calendar year in which the Gross-Up Payment is
to be made, and (ii) pay applicable state and local income taxes at the highest
marginal rate of taxation for the calendar year in which the Gross-Up Payment is
to be made, net of the maximum reduction in federal income taxes which could be
obtained from deduction of such state and local taxes.

                  (a) Subject to the provisions of paragraph (b) of this
         Section, all determinations required to be made under this Section 5.8,
         including whether and when a Gross-Up Payment is required and the
         amount of such Gross-Up Payment and the assumptions to be utilized in
         arriving at such determination, shall be made by a "Big Four"
         accounting firm (the "Accounting Firm") selected by the Chief Executive
         Officer; PROVIDED, that if the Gross-Up Payment relates to the
         termination of the Chief Executive Officer's employment with Employer,
         then the Accounting Firm shall be selected by the Chief Financial
         Officer; and PROVIDED, FURTHER that the Accounting Firm shall not also
         be Employer's independent auditor. The Accounting Firm shall provide
         detailed supporting calculations both to Employer and the Employee
         within fifteen (15) business days of the receipt of notice from the
         Employee that there has been a Payment, or such earlier time as is
         requested by Employer. All fees and expenses of the Accounting Firm
         shall be borne solely by Employer. Any Gross-Up Payment, as determined
         pursuant to this Section 5.8, shall be paid by Employer to the Employee
         within five (5) days of the receipt of the Accounting Firm's
         determination. If the Accounting Firm determines that no Excise Tax is
         payable by the Employee, it shall furnish the Employee with a written
         opinion that failure to report the Excise Tax on the Employee's
         applicable federal income tax return would not result in the imposition
         of a negligence or similar penalty. Any determination by the Accounting
         Firm shall be binding upon Employer and the Employee. As a result of
         the uncertainty in the application of Section 4999 of the Code at the
         time of the initial determination by the Accounting Firm hereunder, it
         is possible that Gross-Up Payments that may not have been made by
         Employer should have been made

                                       9
<PAGE>

         ("Underpayment") consistent with the calculations required to be made
         hereunder. In the event that Employer exhausts its remedies pursuant to
         Section 5.8 and the Employee thereafter is required to make a payment
         of any Excise Tax, the Accounting Firm shall determine the amount of
         the Underpayment that has occurred and any such Underpayment shall be
         promptly paid by Employer to or for the benefit of the Employee.

                  (b) Employee shall notify Employer in writing of any claim by
         the Internal Revenue Service that, if successful, would require the
         payment by Employer of the Gross-Up Payment. Such notification shall be
         given as soon as practicable but no later than twenty (20) business
         days after the Employee is informed in writing of such claim and shall
         apprise Employer of the nature of such claim and the date on which such
         claim is requested to be paid. The Employee shall not pay such claim
         prior to the expiration of the thirty (30) day period following the
         date on which it gives such notice to Employer (or such shorter period
         ending on the date that any payment of taxes with respect to such claim
         is due). If Employer notifies the Employee in writing prior to the
         expiration of such period that it desires in good faith to contest such
         claim, the Employee shall:

                           (i) give Employer any information reasonably
                  requested by Employer relating to such claim;

                           (ii) take such action in connection with contesting
                  such claim as Employer shall reasonably request in writing
                  from time to time, including, without limitation, accepting
                  legal representation with respect to such claim by an attorney
                  reasonably selected by Employer;

                           (iii) cooperate with Employer in good faith in order
                  effectively to contest such claim; and

                           (iv) permit Employer to participate in any
                  proceedings relating to such claim;

         PROVIDED, HOWEVER, that Employer shall bear and pay directly all costs
         and expenses (including additional interest and penalties) incurred in
         connection with such contest and shall indemnify and hold the Employee
         harmless, on an after-tax basis, for any Excise Tax or income tax
         (including interest and penalties with respect thereto) imposed as a
         result of such contest and payment of costs and expenses. Without
         limitation on the foregoing provisions of this Section 5.8(b), Employer
         shall control all proceedings taken in connection with such contest
         and, after making a determination in good faith, at its sole option,
         may pursue or forego any and all administrative appeals, proceedings,
         hearings and conferences with the taxing authority in respect of such
         claim and may, at its sole option, either direct the Employee to pay
         the tax claimed and sue for a refund or contest the claim in any
         permissible manner, and the Employee agrees to prosecute such contest
         to a determination before any administrative tribunal, in a court of
         initial jurisdiction and in one or more appellate courts, as Employer
         shall reasonably determine; PROVIDED, HOWEVER, that if Employer directs
         the Employee to pay such claim and sue for a refund, Employer shall
         advance the amount of such payment to the Employee, on an interest-free
         basis and shall indemnify and hold the

                                       10
<PAGE>

         Employee harmless, on an after-tax basis, from any Excise Tax or income
         tax (including interest or penalties with respect thereto) imposed with
         respect to such advance or with respect to any imputed income with
         respect to such advance; and FURTHER PROVIDED that any extension of the
         statute of limitations relating to payment of taxes for the taxable
         year of the Employee with respect to which such contested amount is
         claimed to be due is limited solely to such contested amount.
         Furthermore, Employer's control of the contest shall be limited to
         issues with respect to which a Gross-Up Payment would be payable
         hereunder and the Employee shall be entitled to settle or contest, as
         the case may be, any other issue raised by the Internal Revenue Service
         or any other taxing authority.

                  (c) If, after the receipt by the Employee of an amount
         advanced by Employer pursuant to Section 5.8(b), the Employee becomes
         entitled to receive any refund with respect to such claim, the Employee
         shall (subject to Employer's complying with the requirements of Section
         5.8(b)) promptly pay to Employer the amount of such refund (together
         with any interest paid or credited thereon after taxes applicable
         thereto). If, after the receipt by the Employee of an amount advanced
         by Employer pursuant to Section 5.8(b), a determination is made that
         the Employee shall not be entitled to any refund with respect to such
         claim and Employer does not notify the Employee in writing of its
         intent to contest such denial of refund prior to the expiration of
         thirty (30) days after such determination, then such advance shall be
         forgiven and shall not be required to be repaid and the amount of such
         advance shall offset, to the extent thereof, the amount of Gross-Up
         Payment required to be paid.

                  5.9. EXPENSE REIMBURSEMENT. Employee shall be entitled to
reimbursement for reasonable business expenses incurred prior to the termination
date, subject, however to the provisions of Section 3.1.

                  5.10. PERFORMANCE BONUS. In the situations described in
Sections 5.2, 5.3, 5.4, 5.5, 5.6, and 5.7, upon termination of this Agreement
Employee may be paid a bonus with respect to Employer's fiscal year in which the
termination date occurs, equal to the Performance Bonus that would have been
payable to Employee for the fiscal year if Employee's employment had not been
terminated, multiplied by the number of days in the fiscal year prior to and
including the date of termination and divided by three hundred sixty-five (365).
Any amount paid under this Section 5.10 shall be paid to Employee when Employer
pays performance bonuses to its eligible employees, which may be in the calendar
year following the termination date of this Agreement.

                  5.11. EMPLOYMENT TRANSITION AND SEVERANCE AGREEMENT. If
Employer so requests within five business days following a termination of this
Agreement pursuant to Section 4.2, 4.4, 4.5, or 4.7, Employee shall continue to
be employed by Employer on a part time basis for a period (the "Transition
Period") to be determined by Employer that shall not exceed ninety (90) days,
unless extended by mutual agreement. During the Transition Period, the Employee
shall perform (to the extent reasonably capable in the case of a termination
pursuant to Section 4.5 or Section 4.7) such services as may reasonably be
required for the transition to others of matters previously within Employee's
responsibilities. Unless otherwise mutually agreed, Employee will not be
required to serve more than five (5) days per month during the Transition
Period. For services during the Transition Period, Employee shall be compensated
at a daily rate equal to his Base Salary

                                       11
<PAGE>

immediately preceding the termination of this Agreement divided by 365. In
addition, if Employee fully satisfies his obligations during the Transition
Period and fully complies with all provisions of Section 8 of this Agreement,
all stock options, restricted stock and other incentive compensation awards
granted to Employee by Employer prior to termination of this Agreement shall
continue to vest.

                  5.12. CONTINUATION OF BENEFIT PLANS. Employee shall be
entitled to continuation of health, medical, hospitalization and other similar
health insurance programs as if Employee were still an employee of Employer
during any Severance Period and, in all cases, as provided by any applicable
law. In addition, if (i) Employee has been an employee of Employer for at least
five (5) years, (ii) this Agreement is terminated (a) by Employer pursuant to
Section 4.2 or 4.4, (b) pursuant to Section 4.3, or (c) by Employee pursuant to
Sections 4.5, 4.6 (provided that such termination is after December 31, 2005),
or 4.7, and (iii) Employee does not breach Section 5.11 of this Agreement, then
Employee and Employee's dependents will be entitled to continue to participate
in Employer's group health and welfare benefit plans (as such plans are in
effect at such time) for a period of five (5) years following the termination
date (or the last day of the Transition Period if Employee's employment is
continued pursuant to Section 5.11 of this Agreement) at the same cost to
Employee (or Employee's family in the case of Employee's death) as such benefits
are provided to other similarly situated active employees of Employer.

                  5.13. VESTING OF INCENTIVE AWARDS UPON A CHANGE IN CONTROL OF
EMPLOYER. Notwithstanding any contrary provision in this Agreement or any Stock
Option or Incentive Compensation Plan then maintained by Employer, in the event
of a Change in Control of Employer, all unvested stock options, stock
appreciation rights, restricted stock and other incentive compensation awards
held by Employee shall automatically vest and, in the case of stock options,
become immediately exercisable.

                  5.14. PERIOD FOR EXERCISING STOCK OPTIONS AFTER TERMINATION.
Except as to incentive stock options granted in accordance with Section 422 of
the Internal Revenue Code, Employee shall be allowed a period of twelve (12)
months after termination of this Agreement for any reason during which to
exercise any vested options to purchase Employer's common stock or vested stock
appreciation rights and realize any other vested incentive compensation awards
that may be granted or made under Employer's 2004 Incentive Compensation Plan
and/or any other similar plan adopted by Employer that provides for the issuance
of stock options, restricted stock and other awards to its employees. In all
other respects, the terms of the 2004 Incentive Compensation Plan or such other
plan then in effect shall control the terms and conditions of any awards made
pursuant thereto.

         6. SUCCESSORS; BINDING AGREEMENT.

                  6.1. SUCCESSORS. Employer shall require any successor (whether
direct or indirect, by purchase, merger, consolidation or otherwise) acquiring a
majority of Employer's voting common stock or any other successor to all or
substantially all of the business and/or assets of Employer to expressly assume
and agree to perform this Agreement in the same manner and to the same extent
that Employer would be required to perform it if no such succession had taken
place and Employee hereby consents to any such assignment. In such event,
"Employer" shall mean Employer as

                                       12
<PAGE>

previously defined and any successor to its business and/or assets which
executes and delivers the agreement provided for in this Section 6 or which
otherwise becomes bound by all the terms and provisions of this Agreement by
operation of law. This Section shall not limit Employee's ability to terminate
this Agreement in the circumstances described in Section 4.7 in the event of a
Change in Control of Employer.

                  6.2. BENEFIT. This Agreement and all rights of Employee under
this Agreement shall inure to the benefit of and be enforceable by Employee's
personal or legal representatives, executors, administrators, successors, heirs,
distributees, devisees and legatees. If Employee should die after the
termination date and amounts would have been payable to Employee under this
Agreement if Employee had continued to live, including under Section 5 hereof,
then such amounts shall be paid to Employee's devisee, legatee, or other
designee or, if there is no such designee, Employee's estate.

         7. CONFLICTS WITH PRIOR EMPLOYMENT CONTRACT. Except as otherwise
provided in this Agreement, this Agreement constitutes the entire agreement
among the parties pertaining to the subject matter hereof, and supersedes and
revokes any and all prior or existing agreements, written or oral, relating to
the subject matter hereof, and this Agreement shall be solely determinative of
the subject matter hereof.

                                       13
<PAGE>

         8. RESTRICTIVE COVENANTS; CONFIDENTIAL INFORMATION; WORK PRODUCT;
INJUNCTIVE RELIEF.

                  8.1. NO MATERIAL COMPETITION.

                  (a) Employer and Employee acknowledge and agree that a strong
         relationship and connection exists between Employer and its current and
         prospective patients, referral sources, and customers as well as the
         hospitals and healthcare facilities at which it provides professional
         services. Employer and Employee further acknowledge and agree that the
         restrictive covenants described in this Section are designed to
         enforce, and are ancillary to or part of, the promises contained in
         this Agreement and are reasonably necessary to protect the legitimate
         interests of Employer in the following: (i) the use and disclosure of
         the Confidential Information as described in Section 8.4; and (ii) the
         professional development activities described in Section 1.2. The
         foregoing listing is by way of example only and shall not be construed
         to be an exclusive or exhaustive list of such interests. Employee
         acknowledges that the restrictive covenants set forth below are of
         significant value to Employer and were a material inducement to
         Employer in agreeing to the terms of this Agreement. Employee further
         acknowledges that the goodwill and other proprietary interest of
         Employer will suffer irreparable and continuing damage in the event
         Employee enters into competition with Employer in violation of this
         Section.

                   Therefore, Employee agrees that, except with respect to
         services performed under this Agreement on behalf of Employer, EMPLOYEE
         SHALL NOT, at any time during the Restricted Period (as defined below)
         for any reason, for Employee or on behalf of any other person, persons,
         firm, partnership, corporation or employer, participate or engage in or
         own an interest in, directly or indirectly, any individual
         proprietorship, partnership, corporation, joint venture, trust or other
         form of business entity, whether as an individual proprietor, partner,
         joint venturer, officer, director, member, employee, consultant,
         independent contractor, stockholder, lender, landlord, finder, agent,
         broker, trustee, or in any manner whatsoever, if such entity or its
         affiliates is engaged in, directly or indirectly, "Employer's
         Business," as defined on Exhibit A hereto. Employee acknowledges that,
         as of the date hereof, Employee's responsibilities will include matters
         affecting the businesses of Employer listed on Exhibit A.

                  (b) MEDICAL SERVICES IN FLORIDA. Employee acknowledges that
         Employee's duties under this Agreement have included Employee's active
         leadership relating to medical practices owned or operated by Employer
         and by Employer's affiliate of Employer in the State of Florida.
         Employee further acknowledges that Employer and Employer's affiliates
         in Florida have a substantial investment in such medical practices and
         that Employer and Employer's affiliates would be economically injured
         due to lost income in a material amount in the event Employee competes
         with Employer or any of Employer's affiliates in their primary market
         areas in Florida. Accordingly, Employee agrees that EMPLOYEE SHALL NOT,
         at any time during the Restricted Period, for any reason, for Employee
         or on behalf of any other person, persons, firm, partnership,
         corporation or employer, provide professional medical services in any
         of the clinical practice areas described as Employer's Business on
         Exhibit A

                                       14
<PAGE>

         within a radius of twenty (20) miles of a medical practice owned or
         operated by Employer or any of Employer's affiliates in Florida.

                  For purposes of this Section 8, the "Restricted Period" shall
mean the Employment Period plus (i) twelve (12) months in the event this
Agreement is terminated pursuant to Sections 4.1(a), 4.1(b) or 4.1(d), (ii)
eighteen (18) months in the event this Agreement is terminated pursuant to
Section 4.1(c), (iii) thirty (30) months in the event this Agreement is
terminated pursuant to Section 4.4 or 4.7, or (iv) twenty-four (24) months in
the event this Agreement is terminated for any other reason.

                  8.2. NO HIRE. Employee further agrees that EMPLOYEE SHALL NOT,
at any time during the Restricted Period, for any reason, for Employee or on
behalf of any other person, persons, firm, partnership, corporation or employer,
employ, or knowingly permit any company or business directly or indirectly
controlled by Employee to employ or otherwise engage (a) any person who is a
then current employee or independent contractor of Employer or one of its
affiliates, or (b) any person who was an employee or independent contractor of
Employer or one of its affiliates in the prior six (6) month period, or in any
manner seek to induce such persons to leave his or her employment or engagement
with Employer or one of its affiliates (including without limitation for or on
behalf of a subsequent employer of Employee). Notwithstanding the foregoing, it
shall not be a violation of this Section for Employee to participate in any
capacity in a business venture after termination of this Agreement with a
current or former employee or independent contractor of Employer or its
affiliates if (i) Employee's participation in such business venture does not
violate Section 8.1, (ii) Employee and such individual were actively pursuing
such business venture for a period of at least six (6) months while both were
employed or otherwise engaged by Employer, and (iii) a period of at least one
(1) year has elapsed since the termination of Employee's employment.

                  8.3. NON-SOLICITATION. Employee further agrees that EMPLOYEE
SHALL NOT, at any time during the Restricted Period, for any reason, for
Employee or on behalf of any other person, persons, firm, partnership,
corporation or employer, solicit or accept business from or take any action that
would interfere with, diminish or impair the valuable relationships that
Employer or its affiliates have with (i) hospitals or other health care
facilities with which Employer or its affiliates have contracts to render
professional services or otherwise have established relationships, (ii)
patients, (iii) referral sources, (iv) vendors, (v) any other clients of
Employer or its affiliates, or (vi) prospective hospitals, patients, referral
sources, vendors or clients whose business Employee was aware that Employer or
any affiliate of Employer was in the process of soliciting at the time of
Employee's termination (including potential acquisition targets).

                  8.4. CONFIDENTIAL INFORMATION. At all times during the term of
this Agreement, Employer shall provide Employee with access to "Confidential
Information." As used in this Agreement, the term "Confidential Information"
means any and all confidential, proprietary or trade secret information, whether
disclosed, directly or indirectly, verbally, in writing or by any other means in
tangible or intangible form, including that which is conceived or developed by
Employee, applicable to or in any way related to: (i) patients with whom
Employer has a physician/patient relationship; (ii) the present or future
business of Employer; or (iii) the research and development of Employer. Without
limiting the generality of the foregoing, Confidential Information includes: (a)

                                       15
<PAGE>

the development and operation of Employer's medical practices, including
information relating to budgeting, staffing needs, marketing, research, hospital
relationships, equipment capabilities, and other information concerning such
facilities and operations and specifically including the procedures and business
plans developed by Employer for use at the hospitals where Employer conducts its
business; (b) contractual arrangements between the Employer and insurers or
managed care associations or other payors; (c) the databases of Employer; (d)
the clinical and research protocols of Employer, including coding guidelines;
(e) the referral sources of Employer; and (f) other confidential information of
Employer that is not generally known to the public that gives Employer the
opportunity to obtain an advantage over competitors who do not know or use it,
including the names, addresses, telephone numbers or special needs of any of its
patients, its patient lists, its marketing methods and related data, lists or
other written records used in Employer's business, compensation paid to
employees and other terms of employment, accounting ledgers and financial
statements, contracts and licenses, business systems, business plan and
projections, and computer programs. The parties agree that, as between them,
this Confidential Information constitutes important, material, and confidential
trade secrets that affect the successful conduct of Employer's business and its
goodwill. Employer acknowledges that the Confidential Information specifically
enumerated above is special and unique information and is not information that
would be considered a part of the general knowledge and skill Employee has or
might otherwise obtain.

                  Notwithstanding the foregoing, Confidential Information shall
not include any information that (i) was known by Employee from a third party
source before disclosure by or on behalf of Employer, (ii) becomes available to
Employee from a source other than Employer that is not, to Employee's knowledge,
bound by a duty of confidentiality to Employer, (iii) becomes generally
available or known in the industry other than as a result of its disclosure by
Employee, or (iv) has been independently developed by Employee and may be
disclosed by Employee without breach of this Agreement, PROVIDED, in each case,
that the Employee shall bear the burden of demonstrating that the information
falls under one of the above-described exceptions.

                  Employee agrees that, except as required in the performance of
Employee's duties as an employee of Employer, Employee will not at any time,
whether during or subsequent to the term of Employee's employment with Employer,
in any fashion, form or manner, unless specifically consented to in writing by
Employer, either directly or indirectly, use or divulge, disclose, or
communicate to any person, firm or corporation, in any manner whatsoever, any
Confidential Information of any kind, nature, or description, subject to
applicable law. The parties agree that any breach by Employee of any term of
this Section is a material breach of this Agreement and shall constitute "cause"
for the termination of Employee's employment hereunder. In the event that
Employee is ordered to disclose any Confidential Information, whether in a legal
or a regulatory proceeding or otherwise, Employee shall provide Employer with
prompt written notice of such request or order so that Employer may seek to
prevent disclosure or, if that cannot be achieved, the entry of a protective
order or other appropriate protective device or procedure in order to assure, to
the extent practicable, compliance with the provisions of this Agreement. In the
case of any disclosure required by law, Employee shall disclose only that
portion of the Confidential Information that Employee is ordered to disclose in
a legally binding subpoena, demand or similar order issued pursuant to a legal
or regulatory proceeding.

                                       16
<PAGE>

                  All Confidential Information, and all equipment, notebooks,
documents, memoranda, reports, files, samples, books, correspondence, lists,
other written and graphic records, in any media (including electronic or video)
containing Confidential Information or relating to the business of Employer,
which Employee shall prepare, use, construct, observe, possess, or control shall
be and remain Employer's sole property (collectively "Employer Property"). Upon
termination or expiration of this Agreement, or earlier upon Employer's request,
Employee shall promptly deliver to Employer all Employer Property, retaining
none.

                  8.5. OWNERSHIP OF WORK PRODUCT. Employee agrees and
acknowledges that all copyrights, patents, trade secrets, trademarks, service
marks, or other intellectual property or proprietary rights associated with any
ideas, concepts, techniques, inventions, processes, or works of authorship
developed or created by Employee during the course of performing work for
Employer and any other work product conceived, created, designed, developed or
contributed by Employee during the term of this Agreement that relates in any
way to Employer's Business (collectively, the "Work Product"), shall belong
exclusively to Employer and shall, to the extent possible, be considered a work
made for hire within the meaning of Title 17 of the United States Code. To the
extent the Work Product may not be considered a work made for hire owned
exclusively by Employer, Employee hereby assigns to Employer all right, title,
and interest worldwide in and to such Work Product at the time of its creation,
without any requirement of further consideration. Upon request of Employer,
Employee shall take such further actions and execute such further documents as
Employer may deem necessary or desirable to further the purposes of this
Agreement, including without limitation separate assignments of all right,
title, and interest in and to all rights of copyright and all right, title, and
interest in and to any inventions or patents and any reissues or extensions
which may be granted therefore, and in and to any improvements, additions to, or
modifications thereto, which Employee may acquire by invention or otherwise, the
same to be held and enjoyed by Employer for its own use and benefit, and for the
use and benefit of Employer's successors and assigns, as fully and as entirely
as the same might be held by Employee had this assignment not been made.

                  8.6. CLEARANCE PROCEDURE FOR PROPRIETARY RIGHTS NOT CLAIMED BY
EMPLOYER. In the event that Employee wishes to create or develop, OTHER THAN on
Employer's time or using Employer's resources, anything that may be considered
Work Product but of which Employee believes Employee should be entitled to the
personal benefit, Employee agrees to follow the clearance procedure set forth in
this Section 8.6. Before beginning any such work, Employee agrees to give
Employer advance written notice and provide Employer with a sufficiently
detailed written description of the work under consideration for Employer to
make a determination regarding the work. Unless otherwise agreed in a writing
signed by Employer prior to receipt, Employer shall have no obligation of
confidentiality with respect to such request or description. Employer will
determine in its sole discretion, within thirty (30) days after Employee has
fully disclosed such plans to Employer, whether rights in such work will be
claimed by Employer. If Employer determines that it does not claim rights in
such work, Employer agrees to so notify Employee in writing and Employee may
retain ownership of the work to the extent that such work has been expressly
disclosed to Employer. If Employer fails to so notify Employee within such
thirty (30) day period, then Employer shall be deemed to have agreed that such
work is not considered Work Product for purposes of this Agreement. Employee
agrees to submit for further review any significant improvement,

                                       17
<PAGE>

modification, or adaptation that could reasonably be related to Employer's
Business so that it can be determined whether the improvement, modification, or
adaptation relates to the business or interests of Employer. Clearance under
this procedure does not relieve Employee of the restrictive covenants set forth
in this Section 8.

                  8.7. NON-DISPARAGEMENT AND MEDICAL MALPRACTICE CASE. Employer
agrees that for a period of ten (10) years after the termination of this
Agreement, Employer shall not disparage Employee or otherwise impugn Employee's
name or reputation. Employee agrees that for a period of ten (10) years after
the termination of this Agreement, Employee shall not (i) disparage Employer or
any of Employer's affiliates (including any present, future or former agent,
attorney, employee, officer or director of Employer or any of Employer's
affiliates); (ii) impugn in any manner the name or reputation of Employer or any
of Employer's affiliates (including any present, future or former agent,
attorney, employee, officer or director of Employer or any of Employer's
affiliates); or (iii) speak or write anything disparaging or critical of
Employee's work conditions or the circumstances of the termination of Employee's
employment with Employer. Furthermore, for a period of ten (10) years after the
termination of this Agreement, Employee shall not serve as a medical consultant
or expert witness for any person or entity (including any attorney for such
person or entity) in any lawsuit or other proceeding against Employer or any
Related Person (as hereinafter defined). For purposes of this Section 8.7, each
of the following is a Related Person: (a) every present, future and former
affiliate of Employer; (b) every present, future and former agent, employee,
officer and director of Employer or any affiliate of Employer; and (c) every
hospital at which professionals affiliated with Employer have provided services
at any time material to the lawsuit or other proceeding.

                  8.8. REVIEW BY EMPLOYEE. EMPLOYEE HAS CAREFULLY READ AND
CONSIDERED THE TERMS AND PROVISIONS OF THIS SECTION 8, AND HAVING DONE SO,
AGREES THAT THE RESTRICTIONS SET FORTH IN THIS SECTION 8 ARE FAIR AND REASONABLY
REQUIRED FOR THE PROTECTION OF THE INTERESTS OF EMPLOYER. Without limiting other
possible remedies available to Employer, Employee agrees that injunctive or
other equitable relief will be available to enforce the covenants set forth in
this Section, such relief to be without the necessity of posting a bond. In the
event that, notwithstanding the foregoing, any part of the covenants set forth
in this Section 8 shall be held to be invalid, overbroad, or unenforceable by an
arbitration panel or a court of competent jurisdiction, the parties hereto agree
that such invalid, overbroad, or unenforceable provision(s) may be modified or
severed from this Agreement without, in any manner, affecting the remaining
portions of this Section 8 (all of which shall remain in full force and effect).
In the event that any provision of this Section 8 related to time period or
areas of restriction shall be declared by an arbitration panel or a court of
competent jurisdiction to exceed the maximum time period, area or activities
such arbitration panel or court deems reasonable and enforceable, said time
period or areas of restriction shall be deemed modified to the minimum extent
necessary to make the geographic or temporal restrictions or activities
reasonable and enforceable.

                  8.9. SURVIVAL AND TERMINATION OF PAYMENTS AND BENEFITS. The
provisions of this Section 8 shall survive the termination of this Agreement and
Employee's employment with Employer. If Employee fails to comply fully with any
provision of this Section 8, Employee shall not be entitled to receive any
further payments or benefits of any kind under Section 5 of this

                                       18
<PAGE>

Agreement (other than Base Salary through date of termination and any amounts
due under Section 5.9 hereof) and Employer shall have the right to terminate
without advance notice any and all other future payments and benefits of every
kind that otherwise would be due Employee under Section 5 of this Agreement. The
provisions of this Section 8 are expressly intended to benefit and be
enforceable by other affiliated entities of Employer, who are express third
party beneficiaries hereof. Employee shall not assist others in engaging in any
of the activities described in the foregoing restrictive covenants.

         9. ARBITRATION. Any controversy or claim arising out of or relating to
this Agreement, or any alleged breach hereof shall be finally determined by
binding arbitration before a three member panel, consisting of one member
selected by each party hereto, with the third member selected by the first two
arbitrators. Each party hereto shall bear the costs of its own nominee, and
shall share equally the cost of the third arbitrator and the parties agree that
the costs of arbitration shall not be subject to reapportionment by the
arbitration panel. The arbitration proceedings shall be held in Sunrise,
Florida, unless otherwise mutually agreed by the parties, and shall be conducted
in accordance with the American Health Lawyer's Association Dispute Resolution
Service, Rules of Procedure for Arbitration. Judgment on the award rendered by
the arbitration panel may be entered and enforced by any court having
jurisdiction thereof. Notwithstanding anything herein to the contrary, if the
Employer shall require immediate injunctive relief, then the Employer shall be
entitled to seek such relief in any court having jurisdiction, and if the
Employer elects to do so, the Employee hereby consents to the jurisdiction of
the state and federal courts sitting in the State of Florida and to the
applicable service of process. Employee hereby waives and agrees not to assert,
to the fullest extent permitted by applicable law, any claim that (i) Employee
is not subject to the jurisdiction of such courts, (ii) Employee is immune from
any legal process issued by such courts and (iii) any litigation or other
proceeding commenced in such courts is brought in an inconvenient forum. Any
such arbitration shall be treated as confidential by all parties thereto, except
as otherwise provided by law or as otherwise necessary to enforce any judgment
or order issued by the arbitrators.

         10. GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of Florida without regard to its conflict
of laws principles to the extent that such principles would require the
application of laws other than the laws of the State of Florida.

         11. NOTICES. Any notice required or permitted to be given under this
Agreement shall be in writing and shall be deemed to have been given when
delivered by hand or when deposited in the United States mail by registered or
certified mail, return receipt requested, postage prepaid, addressed as follows:

          If to Employer:                      If to Employee:

          Pediatrix Medical Group, Inc.        Roger J. Medel, M.D., M.B.A.
          1301 Concord Terrace                 c/o Pediatrix Medical Group, Inc.
          Sunrise, FL 33323                    1301 Concord Terrace
          Attention: General Counsel           Sunrise, FL 33323

                                       19
<PAGE>

or to such other addresses as either party hereto may from time to time give
notice of to the other in the aforesaid manner.

         12. BENEFITS: BINDING EFFECT. This Agreement shall be for the benefit
of and binding upon the parties hereto and their respective heirs, personal
representatives, legal representatives, successors and, where applicable,
assigns. Notwithstanding the foregoing, Employee may not assign the rights or
benefits hereunder without the prior written consent of Employer.

         13. SEVERABILITY. The invalidity of any one or more of the words,
phrases, sentences, clauses or Sections contained in this Agreement shall not
affect the enforceability of the remaining portions of this Agreement or any
part thereof.

         14. WAIVERS. The waiver by either party hereto of a breach or violation
of any term or provision of this Agreement shall not operate nor be construed as
a waiver of any subsequent breach or violation.

         15. DAMAGES. Nothing contained herein shall be construed to prevent
Employer or Employee from seeking and recovering from the other damages
sustained by either or both of them as a result of a breach of any term or
provision of this Agreement. In the event of any controversy or claim arising
out of or relating to this Agreement, each party will bear its own costs for
court and attorneys' fees.

         16. NO THIRD PARTY BENEFICIARY. Except as provided in Section 8.9,
nothing expressed or implied in this Agreement is intended, or shall be
construed, to confer upon or give any person (other than the parties hereto and,
in the case of Employee, Employee's heirs, personal representative(s) and/or
legal representative) any rights or remedies under or by reason of this
Agreement. No agreements or representations, oral or otherwise, express or
implied, have been made by either party with respect to the subject matter of
this Agreement which agreements or representations are not set forth expressly
in this Agreement, and this Agreement supersedes any other agreement between
Employer and Employee.

         17. HEADINGS. The section headings in this Agreement are solely for
convenience of reference and form no part of this Agreement.

         IN WITNESS WHEREOF, the undersigned have executed this Agreement as of
the date first above written.

EMPLOYER:                                   EMPLOYEE:

PEDIATRIX MEDICAL GROUP, INC.

By: /s/ Waldemar A. Carlo, M.D.             /s/ Roger J. Medel, M.D.
    ---------------------------------       ------------------------------------
    Waldemar A. Carlo, M.D.                 Roger J. Medel, M.D.
    Chairman, Compensation Committee

                                       20
<PAGE>

                                    EXHIBIT A

                              BUSINESS OF EMPLOYER

         As of the date hereof, Employer, directly or through its affiliates,
provides professional medical services and all aspects of practice management
services in medical practice areas that include, but are not limited to, the
following (collectively referred to herein as "Employer's Business"):

                  (1) Neonatology, including hospital well baby care;

                  (2) Maternal-Fetal Medicine, including general obstetrics
         services;

                  (3) Pediatric Cardiology;

                  (4) Pediatric Intensive Care, including Pediatric Hospitalist
         Care; and

                  (5) Newborn metabolic and hearing screening services.

         References to Employer's Business in this Agreement shall include such
other medical service lines, practice management services and other businesses
entered into by Employer after the date hereof but during the term of this
Agreement; PROVIDED, that to be considered a part of Employer's Business,
Employer must have engaged in such other service line, practice management
service or other business at least six (6) months prior to the termination date
of this Agreement. For purposes of this Exhibit A, businesses of Employer shall
include the businesses conducted by Employer's subsidiaries, entities under
common control and affiliates as defined under Rule 144 of the Securities Act of
1933, as amended. Such affiliates shall include the professional corporations
and associations whose operating results are consolidated with Employer for
financial reporting purposes.

         Notwithstanding the foregoing, Employer acknowledges and agrees to the
following exceptions and clarifications regarding the scope of Employer's
Business.

         A. PRACTICE MANAGEMENT SERVICES. Employer acknowledges that, as of the
date hereof, Employer's Business relates to the delivery of both professional
and practice management services in the forgoing practice areas. Therefore, as
of the date hereof, Employer acknowledges that it would not be a violation of
Section 8.1 of the Agreement for Employee to provide services to a practice
management company (such as a billing company or management services
organization (MSO)) if such practice management company is not owned by,
affiliated with (as defined under Rule 144 of the Securities Act of 1933, as
amended) or under common control with a health care provider that provides
services in the medical services areas included in Employer's Business. Subject
to paragraph C below, the provisions of this paragraph shall not apply to the
extent that, after the date hereof, Employer enters into a business that
involves the delivery of practice management services to unrelated third
parties.

         B. HOSPITAL SERVICES. Employer and Employee acknowledge that, as of the
date hereof, Employer does not currently operate hospitals, hospital systems or
universities. Nevertheless, the businesses of hospitals, hospital systems and
universities would be the same as Employer's Business where such hospitals,
hospital systems or universities provide some or all of the medical services

                                       21
<PAGE>

included in Employer's Business. Therefore, the parties desire to clarify their
intent with respect to the limitations on Employee's ability to work for a
hospital, hospital system or university after termination of this Agreement.
Section 8.1 shall not be deemed to restrict Employee's ability to work for a
hospital, hospital system or university if the hospital, hospital system or
university does not provide any of the medical services included in Employer's
Business. Furthermore, even if a hospital, hospital system or university
provides medical services that are included in Employer's Business, Employee may
work for such hospital, hospital system or university if (i) Employee has no
direct supervisory responsibility for or involvement in the hospital's, hospital
system's or university's medical services that are Employer's Business, and (ii)
Employee would not otherwise violate Section 8.1(b). Finally, Employer agrees
that Employee may hold direct supervisory responsibility for or be involved in
the medical services of a hospital, hospital system or university that are
included in Employer's Business so long as such hospital, hospital system or
university is located at least ten (10) miles from a medical practice owned or
operated by Employer or its affiliate. Subject to paragraph C below, the
provisions of this paragraph shall not apply to the extent that, after the date
hereof, Employer enters into the business of operating a hospital or health
system.

         C. DEMINIMUS EXCEPTION. Employer agrees that a medical service line
(other than those listed in items 1 through 5 above), practice management
service or other business entered into by Employer shall not be considered to be
a part of Employer's Business if such medical service line, practice management
service or other business constitutes less than Fifteen Million Dollars
($15,000,000) of Employer's annual revenues.

         D. CERTAIN OWNERSHIP INTERESTS. It shall not be deemed to be a
violation of Section 8.1 for Employee to: (i) own, directly or indirectly, one
percent (1%) or less of a publicly-traded entity; or (ii) own, directly or
indirectly, less than five percent (5%) of a privately-held business or company,
if Employee is at all times a passive investor with no board representation,
management authority or other special rights to control operations of such
business.

                                       22

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