Document:

Exhibit  10.26

                 ______________________________________________
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                              AMENDED AND RESTATED
                          CREDIT AND SECURITY AGREEMENT
                                 BY AND BETWEEN
                                 ROCKSHOX, INC.
                                       AND
                        WELLS FARGO BUSINESS CREDIT, INC.
                           Dated as of:  June 29, 2000
                 ______________________________________________
                 ==============================================

<PAGE>
                              AMENDED AND RESTATED
                          CREDIT AND SECURITY AGREEMENT

                            Dated as of June 29, 2000

This  Amended  and  Restated  Credit and Security Agreement (the "Agreement") is
                                                                  ---------
entered  into as of June 29, 2000 between ROCKSHOX, INC., a Delaware corporation
(the  "Borrower") and WELLS FARGO BUSINESS CREDIT, INC., a Minnesota corporation
       --------
(the  "Lender").
WHEREAS,  Borrower  has  previously entered into a Credit and Security Agreement
with  Lender  dated  as  of December 10, 1999 (the "Existing Credit Agreement");
WHEREAS, Borrower has requested certain changes to the existing credit facility;
WHEREAS,  Lender  is  willing to amend and restate the Existing Credit Agreement
pursuant to which Lender will continue to make loans and provide other financial
accommodations  to  Borrower;
NOW, THEREFORE, in consideration of the promises and of the mutual covenants and
agreements  contained  herein,  the  parties  hereto  hereby  agree to amend and
restate  the  Existing  Credit  Agreement  as  follows:

                                    ARTICLE I

                                   Definitions
                                   -----------
     Section 1.1     Definitions.  For all purposes of this Agreement, except as
                     -----------
otherwise  expressly  provided  or  unless  the  context  otherwise  requires:

          (a) the terms  defined in this Article  have the meanings  assigned to
     them in this Article, and include the plural as well as the singular; and

          (b) all  accounting  terms  not  otherwise  defined  herein  have  the
     meanings assigned to them in accordance with GAAP.

          "Accounts"  means  all  of  the  Borrower's accounts, as such term  is
      --------
     defined in the UCC,  including  without  limitation  the  aggregate  unpaid
     obligations of customers and other account debtors to the Borrower  arising
     out of the sale or lease of goods or  rendition of services by the Borrower
     on an open account or deferred payment basis.

          "Adjusted Net Income" means Net Income, decreased by the  sum  of  any
          ---------------------
     extraordinary,  non-operating  or non-cash  income recorded by the Borrower
     and increased by any  extraordinary,  non-cash or non-operating  expense or
     loss recorded by the Borrower, as determined in accordance with GAAP.

          "Advance" means a Revolving Advance.
           -------

          "Affiliate" or  "Affiliates"  means any Person  controlled by or under
           ---------       ----------
     common  control  with the  Borrower,  including  (without  limitation)  any
     Subsidiary of the  Borrower.  For purposes of this  definition,  "control,"
     when used with respect to ------- any specified Person,  means the power to
     direct the management and policies of such Person,  directly or indirectly,
     whether  through  the  ownership  of  voting  securities,  by  contract  or
     otherwise.

<PAGE>
          "Agreement"  means this  Amended  and  Restated  Credit  and  Security
           ---------
     Agreement,  as amended,  restated,  supplemented or otherwise modified from
     time to time.

          "Availability" means the difference of (i) the Borrowing Base and (ii)
           ------------
     the sum of (A) the then outstanding principal balance of the Revolving Note
     and (B) the L/C Amount.

          "Availability  Reserve"  means as of any date of  determination,  such
           ---------------------
     amount or amounts as Lender may from time to time  establish  and revise in
     good faith and in its reasonable  judgment reducing the amount of Revolving
     Advances  which would  otherwise be available to Borrower under the lending
     formula(s)  provided  for  herein:  (a)  to  reflect  events,   conditions,
     contingencies  or risks which, as determined by Lender in good faith and in
     its reasonable judgment,  do or may affect either (i) the Collateral or its
     value,  (ii) the assets,  business or prospects  of Borrower,  or (iii) the
     security interests and other rights of Lender in the Collateral  (including
     the  enforceability,  perfection and priority  thereof),  or (b) to reflect
     Lender's  good  faith  belief  that  any  collateral  report  or  financial
     information  furnished by or on behalf of Borrower to Lender is or may have
     been incomplete,  inaccurate or misleading in any material respect,  or (c)
     in  respect of any state of facts  which  Lender  determines  in good faith
     constitutes  an Event of Default or may,  with notice or passage of time or
     both, constitute an Event of Default.

          "Banking  Day" means a day other than a Saturday,  Sunday or other day
           ------------
     on which banks are generally not open for business in Pasadena, California.

          "Base Rate" means the rate of interest publicly announced from time to
          ----------
     time by Wells Fargo Bank,  N.A., San Francisco,  California,  as its "prime
     rate" (which  "prime  rate" shall not deviate from the Wall Street  Journal
     Prime Rate except for time lag in  adjustments  which shall not exceed five
     (5) Banking Days) or, if such bank ceases to announce a rate so designated,
     any similar successor rate designated by the Lender.

          "Book Net Worth"  means the  difference  between (i) the book value of
           ----------------
     tangible  assets  of the  Borrower,  which,  in  accordance  with  GAAP are
     tangible assets,  after deducting  adequate reserves in each case where, in
     accordance  with  GAAP,  a  reserve  is  proper  and  (ii)  all Debt of the
     Borrower.

          "Borrowing Base" means, at any time the lesser of:
           ---------------
          (a)     the  Maximum  Line;  or
          (b)     subject  to  change  from  time  to  time  in  the  Lender's
                  reasonable discretion,  the  sum  of:

10     eighty  five  percent  (85%)  of  Eligible  Accounts,  plus

11     the  lesser of (A) eighty-five percent (85%) of Eligible Foreign Accounts
and  (B)  One  Million  Dollars  ($1,000,000),  and

                                      - 2 -
<PAGE>
12     minus  any  Availability  Reserves.

          "Capital Expenditures" for a period means any expenditure of money for
           --------------------
     the lease, purchase or other acquisition of any fixed or capital asset.

          "Collateral"  means all  current  or  hereafter  acquired  or  arising
           ----------
     Equipment,   General  Intangibles,   Inventory,   Receivables,   Investment
     Property,  deposit  accounts,  letters  of credit,  proceeds  of letters of
     credit,  chattel paper and all sums on deposit in any  Collateral  Account,
     and any  items in any  Lockbox;  together  with (i) all  substitutions  and
     replacements for and products of any of the foregoing; (ii) proceeds of any
     and all of the  foregoing;  (iii) in the case of all  tangible  goods,  all
     accessions; (iv) all accessories, attachments, parts, equipment and repairs
     now or  hereafter  attached  or affixed to or used in  connection  with any
     tangible  goods;  (v) all  warehouse  receipts,  bills of lading  and other
     documents of title now or hereafter  covering such goods;  (vi) all sums on
     deposit in the Special Account; and (vii) the Life Insurance Policy.

          "Collateral  Account"  means the  "WFBCI  Account"  as  defined in the
           -------------------
     Collection  Account  Agreement  and the "Lender  Account" as defined in the
     ----------  ------------------
     Lockbox Agreement.
     -----------------

          "Collection Account Agreement" means the Collection Account Agreement,
           ----------------------------
     dated as of December 10, 1999, by and among the Borrower, Wells Fargo Bank,
     National Association and the Lender.

          "Commitment"  means the Lender's  commitment  to make  Advances and to
           ----------
     cause the  Issuer  to issue  Letters  of  Credit  to or for the  Borrower's
     account pursuant to Article II.

          "Credit  Facility"  means the credit  facility being made available to
           ----------------
     the Borrower by the Lender pursuant to Article II.

          "Deactivation Period" has the same meaning specified in Section 2.18.
          --------------------

          "Debt"  of  any  Person  means,  without  duplication,  all  items  of
           ----
     indebtedness  or liability  which in accordance with GAAP would be included
     in  determining  total  liabilities as shown on the  liabilities  side of a
     balance  sheet of that  Person  as at the  date as of  which  Debt is to be
     determined.  For purposes of  determining a Person's  aggregate Debt at any
     time,  "Debt"  shall  also  include  the aggregate  principal  payments
             ----
     required  to be made by such  Person at any time  under  any lease  that is
     considered a capitalized lease under GAAP.

          "Default"  means an event  that,  with  giving of notice or passage of
           -------
     time or both, would constitute an Event of Default.

          "Default  Period"  means  any  period of time  beginning  on the day a
           ---------------
     Default or Event of Default has  occurred and ending on the date the Lender
     notifies  the Borrower in writing that such Default or Event of Default has
     been waived.

                                      - 3 -
<PAGE>
          "Default  Rate" means an annual rate equal to three  percent (3%) over
           -------------
     the Floating  Rate,  which rate shall change when and as the Floating  Rate
     changes.

          "Eligible  Accounts"  means all unpaid  Accounts,  net of any credits,
           ------------------
     except the following shall not in any event be deemed Eligible Accounts:

               (i) That  portion  of  Accounts  unpaid 90 days or more after the
          invoice  date (in the event the  Accounts  have trade terms  beyond 30
          days,  that  portion of Accounts  unpaid 30 days after the due date or
          120 days after the invoice date, whichever is shorter);

               (ii) That  portion of  Accounts  that is disputed or subject to a
          claim of offset or a contra account;

               (iii)  That  portion  of  Accounts  not yet  earned  by the final
          delivery of goods or  rendition  of services,  as  applicable,  by the
          Borrower to the customer;

               (iv)  Accounts  owed by any federal unit of  government,  whether
          foreign or domestic (provided,  however,  that there shall be included
          in Eligible  Accounts  that portion of Accounts  owed by such units of
          government for which the Borrower has provided  evidence  satisfactory
          to the  Lender  that (A) the  Lender  has a first  priority  perfected
          security  interest and (B) such Accounts may be enforced by the Lender
          directly  against such unit of government  under all applicable  laws,
          including, without limitation, the Federal Assignment of Claims Act of
          1940, as amended, or any similar law);

               (v) Accounts owed by an account debtor located outside the United
          States or Canada  which are not (A) backed by a bank  letter of credit
          naming the Lender as  beneficiary  or assigned  to the Lender,  in the
          Lender's  possession and acceptable to the Lender in all respects,  in
          its sole discretion, or (B) covered by a foreign receivables insurance
          policy acceptable to the Lender in its reasonable discretion;

               (vi)  Accounts owed by an account  debtor that is insolvent,  the
          subject of bankruptcy proceedings or has gone out of business;

               (vii)  Accounts  owed by a  shareholder,  Subsidiary,  Affiliate,
          officer or employee of the Borrower;

               (viii) Accounts not subject to a duly perfected security interest
          in the  Lender's  favor or which are  subject  to any  lien,  security
          interest  or  claim  in  favor of any  Person  other  than the  Lender
          including without limitation any payment or performance bond;

               (ix)  That  portion  of  Accounts  that  has  been  restructured,
          extended,  amended or modified  which  exceeds an aggregate  amount of
          Fifty-Thousand Dollars ($50,000);

                                      - 4 -
<PAGE>
               (x)  That  portion  of  Accounts  that  constitutes  advertising,
          finance charges, service charges or sales or excise taxes;

               (xi)  Accounts owed by an account  debtor,  regardless of whether
          otherwise eligible,  if twenty-five percent (25%) or more of the total
          amount due under Accounts from such debtor is ineligible under clauses
          (i) or (ix) above;

               (xii)  That  portion  of  Accounts  of a  single  debtor  or  its
          affiliates  which  constitute  more than  twenty-five  percent  (25%),
          (forty  percent  (40%) for Trek  Bicycles  subject  to  credit  checks
          satisfactory to Lender) of all otherwise Eligible Accounts; and

               (xiii) Accounts, or portions thereof, otherwise deemed ineligible
          by the Lender in its reasonable discretion.

     "Eligible  Foreign  Accounts"  means  Accounts  due and owing by an Account
      ---------------------------
debtor  located outside the United States; but excluding any Accounts having the
following  characteristics:

          (i) (A) That  portion  of  Accounts  unpaid 90 days or more  after the
     invoice  date (in the event the  Accounts  have trade terms beyond 30 days,
     that  portion  of  Accounts  unpaid 30 days  after the due date or 120 days
     after the invoice date, whichever is shorter);

          (ii) That  portion of Accounts  that is disputed or subject to a claim
     of offset or a contra account;

          (iii) That portion of Accounts not yet earned by the final delivery of
     goods or  rendition  of  services,  as  applicable,  by the Borrower to the
     customer;

          (iv) Accounts owed by any unit of government;

          (v) Accounts owed by an account debtor that is insolvent,  the subject
     of bankruptcy proceedings or has gone out of business;

          (vi) Accounts owed by a shareholder, Subsidiary, Affiliate, officer or
     employee of the Borrower;

          (vii)  Accounts not subject to a duly perfected  security  interest in
     the Lender's favor or which are subject to any lien,  security  interest or
     claim in favor of any  Person  other  than  the  Lender  including  without
     limitation any payment or performance bond;

          (viii) That portion of Accounts that has been restructured,  extended,
     amended or modified  which  exceeds an aggregate  amount of  Fifty-Thousand
     Dollars ($50,000);

                                      - 5 -
<PAGE>
          (ix) That portion of Accounts that  constitutes  advertising,  finance
     charges, service charges or sales or excise taxes;

          (x)  Accounts  denominated  in any currency  other than United  States
     dollars,  Canadian  dollars,  French  francs,  Swiss francs,  German marks,
     Japanese yen, United Kingdom pounds sterling or New Taiwan Dollars;

          (xi)  Accounts  with respect to which the Borrower has not  instructed
     the Account debtor to pay the Account to the Collateral Account;

          (xii) Accounts owed by debtors  located in countries not acceptable to
     the  Lender in its  reasonable  discretion  (consistent  with its  internal
     policies);

          (xiii)  Accounts  owed by an  account  debtor,  regardless  of whether
     otherwise  eligible,  if 25% or more of the total amount due under Accounts
     from such debtor is ineligible under clauses (i) or (viii) above; and

          (xiv)  Accounts  otherwise  deemed  unacceptable  to the Lender in its
     reasonable discretion.

     "Environmental  Laws"  has  the  meaning  specified  in  Section  5.12.
      -------------------

     "Equipment"  means all of the Borrower's equipment, as such term is defined
      ---------
in  the  UCC, whether now owned or hereafter acquired, including but not limited
to  all  present  and  future  machinery,  vehicles,  furniture,  fixtures,
manufacturing  equipment,  shop  equipment,  office and recordkeeping equipment,
parts,  tools,  supplies,  and  including  specifically (without limitation) the
goods  described  in  any  equipment  schedule  or  list  herewith  or hereafter
furnished  to  the  Lender  by  the  Borrower.

          "ERISA" means the Employee  Retirement Income Security Act of 1974, as
           -----
     amended.

          "Event of Default" has the meaning specified in Section 8.1.
           ----------------

     "Floating Rate" means an annual rate equal to the sum of the Base Rate plus
      -------------
one and three hundred seventy five thousandths  percent  (1.375%),  which annual
rate shall change when and as the Base Rate  changes;  provided,  however,  such
                                                       --------   -------
Floating  Rate shall be adjusted as follows:  if, on December 31,  2000,  (i) no
Event of Default exists or has occurred and is continuing,  (ii) Borrower's Book
Net  Worth  is  not  less  than  Twenty  Million  Dollars  ($20,000,000),  (iii)
Borrower's  Net  Income is not less than  negative  Three  Million  Two  Hundred
Thousand Dollars  (-$3,200,000) for the nine (9) month period ending on December
31, 2000, and (iv)  Borrower's Net Income (net of costs incurred to relocate the
Borrower's  corporate  headquarters to Colorado  Springs,  Colorado) is not less
than negative Seven Hundred Thousand Dollars  (-$700,000) for the nine (9) month
period  ending on December  31, 2000,  the Floating  Rate shall be reduced to an
annual rate equal to the sum of the Base Rate plus three  hundred  seventy  five
thousandths percent (0.375%).

                                      - 6 -
<PAGE>
     "Funding Date" has the meaning specified in Section 2.1.
      ------------

     "GAAP" means generally accepted accounting  principles,  applied on a basis
      ----
consistent  with the accounting  practices  applied in the financial  statements
described in Section 5.5,  except for any change in accounting  practices to the
extent that, due to a promulgation of the Financial  Accounting  Standards Board
changing or implementing any new accounting standard, the Borrower either (i) is
required to implement  such change,  or (ii) for future periods will be required
to and  for  the  current  period  may in  accordance  with  generally  accepted
accounting  principles implement such change, for its financial statements to be
in conformity with generally accepted accounting  principles (any such change is
herein referred to as a "Required GAAP Change"),  provided that (1) the Borrower
                         --------------------
shall fully disclose in such financial  statements any such Required GAAP Change
and the effects of the Required GAAP Change on the Borrower's  income,  retained
earnings or other  accounts,  as applicable,  and (2) the  Borrower's  financial
covenants  set  forth in  Sections  6.12,  6.13 and 7.10  shall be  adjusted  as
necessary to reflect the effects of such Required GAAP Change.

     "General  Intangibles" means all of the Borrower's general intangibles,  as
      --------------------
such  term is  defined  in the UCC,  whether  now owned or  hereafter  acquired,
including   (without   limitation)  all  present  and  future  patents,   patent
applications,  copyrights,  trademarks,  trade names, trade secrets, customer or
supplier  lists  and  contracts,   manuals,  operating  instructions,   permits,
franchises,  the  right to use the  Borrower's  name,  and the  goodwill  of the
Borrower's business.  "Hazardous Substance" has the meaning specified in Section
5.12                   -------------------

     "Inventory" means all of the Borrower's inventory,  as such term is defined
      ---------
in the UCC, whether now owned or hereafter acquired, whether consisting of whole
goods, spare parts or components,  supplies or materials, whether acquired, held
or furnished for sale, for lease or under service  contracts or for  manufacture
or processing, and wherever located.

     "Investment  Property" means all of the Borrower's  investment property, as
      --------------------
such  term is  defined  in the UCC,  whether  now owned or  hereafter  acquired,
including but not limited to all securities,  security entitlements,  securities
accounts,  commodity contracts,  commodity accounts,  stocks, bonds, mutual fund
shares, money market shares and U.S. Government securities.

     "Issuer" means the issuer of any Letter of Credit.
      ------

     "L/C Amount" means the sum of (i) the  aggregate  face amount of any issued
      -----------
and  outstanding  Letters of Credit and (ii) the unpaid amount of the Obligation
of Reimbursement.

     "L/C  Application" means an application and agreement for letters of credit
      ----------------
in  a  form  acceptable  to  the  Issuer  and  the  Lender.

                                      - 7 -
<PAGE>
     "Letter  of  Credit"  has  the  meaning  specified  in  Section  2.2.
      ------------------

     "Loan Documents" means this Agreement, the Note and the Security Documents.
      --------------

     "Lockbox" has the meaning given in the Lockbox Agreement.
      -------

     "Lockbox  Agreement" means the Lockbox and Collection  Account Agreement by
      ------------------
and among the Borrower, Wells Fargo Bank, National Association, Regulus West LLC
and the Lender, dated as of December 10, 1999.

     "Maturity Date" has the meaning specified in Section 2.10.
      --------------

     "Maximum Line" means Five Million Dollars ($5,000,000),  unless said amount
      ------------
is reduced pursuant to Section 2.11, in which event it means the amount to which
said amount is reduced.

     "Minimum Interest Charge" has the meaning specified in Section 2.6(b).
      -----------------------

     "Net Income" has the meaning defined by GAAP.
      ----------

     "Note" means the Revolving Note.
      ----

     "Obligations"  means the Note and each and every other debt,  liability and
      -----------
obligation  of every type and  description  which the Borrower may now or at any
time  hereafter  owe to the  Lender  under  this  Agreement  and the other  Loan
Documents, whether such debt, liability or obligation now exists or is hereafter
created or incurred, and whether it is direct or indirect, due or to become due,
absolute or contingent,  primary or secondary,  liquidated or  unliquidated,  or
sole, joint,  several or joint and several and including  specifically,  but not
limited to, the Obligation of Reimbursement and all indebtedness of the Borrower
arising under this  Agreement,  the Note, any L/C  Application  completed by the
Borrower, or any other loan or credit agreement or guaranty between the Borrower
and the Lender, whether now in effect or hereafter entered into.

     "Obligation of Reimbursement" has the meaning given in Section 2.3(a).
      ---------------------------

     "Patent and Trademark  Security  Agreement"  means the Patent and Trademark
      -----------------------------------------
Security Agreement by the Borrower in favor of the Lender,  dated as of December
10, 1999.

     "Permitted Lien" has the meaning specified in Section 7.1.
      --------------

     "Person" means any  individual,  corporation,  partnership,  joint venture,
      ------
limited   liability   company,   association,    joint-stock   company,   trust,
unincorporated organization or government or any agency or political subdivision
thereof.

     "Plan"  means an employee  benefit  plan or other plan  maintained  for the
      ----
Borrower's employees and covered by Title IV of ERISA.

                                      - 8 -
<PAGE>
     "Premises" means all premises where the Borrower  conducts its business and
      --------
has any  rights of  possession,  including  (without  limitation)  the  premises
legally described in Exhibit C attached hereto.
                    ----------

     "Receivables"  means each and every right of the Borrower to the payment of
      -----------
money,  whether  such right to payment now exists or hereafter  arises,  whether
such right to payment arises out of a sale, lease or other  disposition of goods
or other  property,  out of a rendering of services,  out of a loan,  out of the
overpayment  of  taxes or other  liabilities,  or  otherwise  arises  under  any
contract or  agreement,  whether such right to payment is created,  generated or
earned by the Borrower or by some other person who  subsequently  transfers such
person's  interest to the  Borrower,  whether such right to payment is or is not
already  earned by  performance,  and  howsoever  such right to  payment  may be
evidenced, together with all other rights and interests (including all liens and
security  interests) which the Borrower may at any time have by law or agreement
against any account  debtor or other obligor  obligated to make any such payment
or against any property of such account debtor or other  obligor;  all including
but not limited to all present and future accounts,  contract rights,  loans and
obligations receivable, chattel papers, bonds, notes and other debt instruments,
tax  refunds  and  rights  to  payment  in the  nature of  general  intangibles.

     "Reportable Event" shall have the meaning assigned to that term in Title IV
      ----------------
of ERISA.

     "Revolving Advance" has the meaning specified in Section 2.1.
      -----------------

     "Revolving Note" means the Borrower's revolving promissory note, payable to
      --------------
the order of the Lender in  substantially  the form of Exhibit A hereto,  as the
                                                       ---------
same may hereafter be amended,  restated,  supplemented  otherwise modified from
time to time, and any note or notes issued in substitution therefor, as the same
may hereafter be amended, restated, supplemented otherwise modified from time to
time.

     "Security   Documents"  means  this  Agreement,   the  Collection   Account
      --------------------
Agreement,  the Lockbox  Agreement,  the Patent and Trademark Security Agreement
and any other  document  delivered to the Lender from time to time to secure the
Obligations,  as the same  may  hereafter  be  amended,  restated,  supplemented
otherwise modified from time to time.

     "Security Interest" has the meaning specified in Section 3.1.
      -----------------

     "Special Account" means a specified cash collateral account maintained by a
      ---------------
financial  institution  acceptable to the Lender in  connection  with Letters of
Credit, as contemplated by Section 2.4.

     "Subsidiary"  means any  corporation of which more than fifty percent (50%)
      ----------
of the  outstanding  shares of capital stock having  general  voting power under
ordinary  circumstances  to elect a majority of the board of  directors  of such
corporation, irrespective of whether or not at the time stock of any other class
or classes  shall have or might have voting power by reason of the  happening of
any contingency, is at the time directly or indirectly owned by the Borrower, by
the  Borrower  and  one or more  other  Subsidiaries,  or by one or  more  other
Subsidiaries.

                                      - 9 -
<PAGE>
     "Termination  Date" means the earliest of (i) the Maturity  Date,  (ii) the
      -----------------
date the Borrower  terminates the Credit Facility,  or (iii) the date the Lender
demands payment of the Obligations after an Event of Default pursuant to Section
8.2.

     "UCC" means the Uniform  Commercial  Code as in effect from time to time in
      ---
the state  designated  in Section 9.13 as the state whose laws shall govern this
Agreement, or in any other state whose laws are held to govern this Agreement or
any portion hereof.

          Section 1.2 Cross References. All references in this Agreement to
                      -----------------
Articles,  Sections  and  subsections,   shall  be  to  Articles,  Sections  and
subsections of this Agreement unless otherwise explicitly specified.

                                   ARTICLE II

                     Amount and Terms of the Credit Facility
                     ---------------------------------------

     Section  2.1     Revolving  Advances.  The  Lender agrees, on the terms and
                      -------------------
subject  to  the  conditions  herein set forth, to make advances to the Borrower
from  time  to time from the date all of the conditions set forth in Section 4.1
are  satisfied  (the  "Funding  Date")  to  the Termination Date (the "Revolving
                       -------------                                   ---------
Advances").  The Lender shall have no obligation to make a Revolving Advance if,
after  giving  effect  to  such  requested  Revolving  Advance,  the  sum of the
outstanding  and  unpaid Revolving Advances would exceed the Borrowing Base less
the  L/C  Amount.  The Borrower's obligation to pay the Revolving Advances shall
be  evidenced  by  the  Revolving Note and shall be secured by the Collateral as
provided  in  Article III.  Within the limits set forth in this Section 2.1, the
Borrower may borrow, prepay pursuant to Section 2.11 and reborrow.  The Borrower
agrees  to comply with the following procedures in requesting Revolving Advances
under  this  Section  2.1:

          (a) The Borrower  shall make each  request for a Revolving  Advance to
     the Lender before 10:30 a.m.  (California time) of the day of the requested
     Revolving  Advance.  Requests  may  be  made  in  writing  or by  telephone
     (promptly  confirmed  in  writing),  specifying  the date of the  requested
     Revolving Advance and the amount thereof.  Each request shall be by (i) any
     officer of the Borrower;  or (ii) any person  designated as the  Borrower's
     agent by any officer of the Borrower in a writing  delivered to the Lender;
     or (iii) any person whom the Lender reasonably believes to be an officer of
     the Borrower or such a designated agent.

                                     - 10 -
<PAGE>
          (b) Upon fulfillment of the applicable conditions set forth in Article
     IV, the Lender  shall  disburse  the  proceeds of the  requested  Revolving
     Advance by crediting  the same to the  Borrower's  demand  deposit  account
     maintained with Wells Fargo Bank, National  Association,  unless the Lender
     and the Borrower shall agree in writing to another manner of  disbursement.
     Upon the  Lender's  request,  the  Borrower  shall  promptly  confirm  each
     telephonic   request  for  an  Advance  by  executing  and   delivering  an
     appropriate  confirmation  certificate  to the Lender.  The Borrower  shall
     repay all Advances  even if the Lender does not receive  such  confirmation
     and even if the person  requesting an Advance was not in fact authorized to
     do so. Any request for an Advance, whether written or telephonic,  shall be
     deemed to be a representation by the Borrower that the conditions set forth
     in Section 4.2 have been satisfied as of the time of the request.

          Section  2.2  Letters  of Credit.
                        -------------------

          (a) The Lender  agrees,  on the terms and  subject  to the  conditions
     herein set forth, to cause an Issuer to issue, from the Funding Date to the
     Termination Date, one or more irrevocable standby or documentary letters of
     credit (each, a "Letter of Credit") for the Borrower's account.  The Lender
     shall have no  obligation  to cause an Issuer to issue any Letter of Credit
     if the face  amount of the Letter of Credit to be issued  would  exceed the
     lesser of:

               (i) Two Million Dollars ($2,000,000) less the L/C Amount, or

               (ii) the Borrowing Base less the sum of (A) all  outstanding  and
          unpaid Revolving Advances and (B) the L/C Amount.

     Each Letter of Credit,  if any, shall be issued  pursuant to a separate L/C
     Application  entered into by the Borrower and the Lender for the benefit of
     the  Issuer,  completed  in a manner  satisfactory  to the  Lender  and the
     Issuer.  The terms and  conditions  set forth in each such L/C  Application
     shall supplement the terms and conditions  hereof,  but if the terms of any
     such L/C Application and the terms of this Agreement are inconsistent,  the
     terms hereof shall control.

          (b) No Letter of Credit shall be issued with an expiry date later than
     the Termination Date in effect as of the date of issuance.

          (c) Any  request to cause an Issuer to issue a Letter of Credit  under
     this  Section 2.2 shall be deemed to be a  representation  by the  Borrower
     that the  conditions set forth in Section 4.2 have been satisfied as of the
     date of the request.

          Section  2.3  Payment of  Amounts  Drawn  Under  Letters  of  Credit;
Obligation  of  Reimbursement.  The Borrower  acknowledges  that the Lender,  as
co-applicant,  will be liable to the  Issuer  for  reimbursement  of any and all
draws  under  Letters of Credit and for all other  amounts  required  to be paid
under the applicable L/C Application. Accordingly, the Borrower agrees to pay to
the Lender any and all  amounts  required  to be paid under the  applicable  L/C
Application, when and as required to be paid thereby, and the amounts designated
below, when and as designated:

          (a) The Borrower hereby agrees to pay the Lender on the day a draft is
     honored  under any Letter of Credit a sum equal to all amounts  drawn under
     such Letter of Credit plus any and all reasonable charges and expenses that
     the  Issuer or the Lender  may pay or incur  relative  to such draw and the
     applicable L/C Application,  plus interest on all such amounts, charges and
     expenses  as set forth  below (the  Borrower's  obligation  to pay all such
     amounts is herein referred to as the "Obligation of Reimbursement").

                                     - 11 -
<PAGE>
          (b)  Whenever a draft is  submitted  under a Letter of Credit,  except
     during a  Deactivation  Period,  Issuer  shall  notify the Borrower and the
     Lender thereof, and the Lender shall make a Revolving Advance in the amount
     of the  Obligation  of  Reimbursement  and shall apply the proceeds of such
     Revolving  Advance  thereto.  Such Revolving  Advance shall be repayable in
     accordance with and be treated in all other respects as a Revolving Advance
     hereunder.

          (c) If a draft  is  submitted  under  a  Letter  of  Credit  during  a
     Deactivation  Period,  the Borrower shall either (i) deposit to the Special
     Account an amount, in immediately  available funds, equal to the Obligation
     of  Reimbursement  (such  deposit  shall be made within one (1) Banking Day
     from the date the draft is  honored),  or (ii) request the Lender to make a
     Revolving  Advance in the amount of the  Obligation  of  Reimbursement  and
     apply the proceeds of such Revolving  Advance thereto,  provided that, such
                                                             -------- ----
     Revolving  Advance by the Lender  shall  constitute a  reactivation  of the
     Credit Facility and all charges and fees under Section 2 of this Agreement.
     If the Credit Facility is reactivated  pursuant to this Section 2.3(c), all
     fees  pursuant to Section  2.7(b) for the thirty  (30) day period  prior to
     such reactivation shall become immediately due and payable.

          (d) If a draft is submitted under a Letter of Credit when the Borrower
     is unable, because a Default Period then exists or for any other reason, to
     obtain a Revolving  Advance to pay the  Obligation  of  Reimbursement,  the
     Borrower  shall pay to the  Lender on demand and in  immediately  available
     funds,  the  amount  of  the  Obligation  of  Reimbursement  together  with
     interest,  accrued from the date of the draft until  payment in full at the
     Default  Rate.   Notwithstanding  the  Borrower's  inability  to  obtain  a
     Revolving Advance for any reason, the Lender is irrevocably authorized,  in
     its sole discretion, to make a Revolving Advance in an amount sufficient to
     discharge  the  Obligation  of  Reimbursement  and all  accrued  but unpaid
     interest thereon.

          (e) The Borrower's  obligation to pay any Revolving Advance made under
     this  Section 2.3,  shall be  evidenced  by  Revolving  Note and shall bear
     interest as provided in Section 2.6.

          Section 2.4 Special Account.  If the Credit Facility is terminated for
                      ---------------
any reason  whatsoever  while any Letter of Credit is outstanding,  the Borrower
shall thereupon pay the Lender in immediately available funds for deposit in the
Special Account an amount equal to the L/C Amount.  The Special Account shall be
an  interest  bearing  account  maintained  for  the  Lender  by  any  financial
institution  acceptable to the Lender.  Any interest earned on amounts deposited
in the Special  Account  shall be credited  to the Special  Account.  Amounts on
deposit in the Special  Account may be applied by the Lender at any time or from
time to time to the Obligations in the Lender's sole  discretion,  and shall not
be subject to  withdrawal  by the  Borrower  so long as the Lender  maintains  a
security  interest  therein.  The Lender  agrees to transfer  any balance in the
Special  Account  to the  Borrower  at such time as the  Lender is  required  to
release its security  interest in the Special Account under applicable law or at
such time as no Letters of Credit remain outstanding.

                                     - 12 -
<PAGE>
     Section  2.5     Obligations  Absolute.  The Borrower's obligations arising
                      ---------------------
under Section 2.3 shall be absolute, unconditional and irrevocable, and shall be
paid  strictly  in  accordance  with  the  terms  of  Section  2.3,  under  all
circumstances  whatsoever,  including  (without  limitation)  the  following
circumstances:

          (a) any lack of validity or  enforceability of any Letter of Credit or
     any  other  agreement  or  instrument  relating  to any  Letter  of  Credit
     (collectively the "Related Documents");

          (b) any amendment or waiver of or any consent to departure from all or
     any of the Related Documents;

          (c) the existence of any claim,  setoff,  defense or other right which
     the  Borrower  may  have  at  any  time,  against  any  beneficiary  or any
     transferee of any Letter of Credit (or any persons or entities for whom any
     such beneficiary or any such transferee may be acting),  or other person or
     entity,  whether  in  connection  with  this  Agreement,  the  transactions
     contemplated   herein  or  in  the  Related   Documents  or  any  unrelated
     transactions;

          (d) any statement or any other document  presented under any Letter of
     Credit proving to be forged,  fraudulent,  invalid or  insufficient  in any
     respect or any statement  therein being untrue or inaccurate in any respect
     whatsoever;

          (e)  payment  by or on behalf of the  Issuer or the  Lender  under any
     Letter of Credit against  presentation of a draft or certificate which does
     not strictly comply with the terms of such Letter of Credit; or

          (f) any other  circumstance  or happening  whatsoever,  whether or not
     similar to any of the foregoing.

           Section  2.6     Interest;  Minimum  Interest  Charge;  Default
                            ----------------------------------------------
Interest; Participations;  Usury.
--------------------------------

          (a) REVOLVING NOTE. Except as set forth in Sections 2.6(c) and 2.6(e),
     the outstanding principal balance of the Revolving Note shall bear interest
     at the Floating Rate.

          (b) MINIMUM  INTEREST  CHARGE.  Notwithstanding  the interest  payable
     pursuant to Section  2.6(a),  the Borrower shall pay to the Lender interest
     of not less  than  Twenty-Five  Thousand  Dollars  ($25,000)  per  calendar
     quarter on a pro rated basis (the  "Minimum  Interest  Charge")  during the
                                         -------------------------
     term of this Agreement,  and the Borrower shall pay any deficiency  between
     the Minimum Interest Charge and the amount of interest otherwise calculated
     under Sections  2.6(a) and 2.6(d) on the date and in the manner provided in
     Section 2.8.

                                     - 13 -
<PAGE>
          (c) DEFAULT  INTEREST RATE. At any time during any Default Period,  in
     the Lender's sole  discretion  and without  waiving any of its other rights
     and remedies,  the principal of the Advances  outstanding from time to time
     shall  bear  interest  at the  Default  Rate,  effective  for  any  periods
     designated by the Lender from time to time during that Default Period.

          (d) PARTICIPATIONS. If any Person shall acquire a participation in the
     Advances  under this  Agreement,  the  Borrower  shall be  obligated to the
     Lender to pay the full  amount of all  interest  calculated  under  Section
     2.6(a), along with all other fees, charges and other amounts due under this
     Agreement, regardless if such Person elects to accept interest with respect
     to its  participation  at a lower rate than the Floating Rate, or otherwise
     elects to accept  less than its pro rata  share of such fees,  charges  and
     other amounts due under this Agreement.

          (e) USURY.  In any event no rate change shall be put into effect which
     would  result in a rate  greater  than the highest  rate  permitted by law.
     Notwithstanding  anything to the contrary  contained in any Loan  Document,
     all  agreements  which  either  now are or which  shall  become  agreements
     between  the  Borrower  and the  Lender  are  hereby  limited so that in no
     contingency or event  whatsoever  shall the total liability for payments in
     the nature of interest,  additional  interest and other charges  exceed the
     applicable  limits imposed by any applicable usury laws. If any payments in
     the nature of interest,  additional  interest and other  charges made under
     any Loan  Document  are held to be in excess of the  limits  imposed by any
     applicable  usury  laws,  it is agreed  that any such  amount held to be in
     excess  shall  be  considered  payment  of  principal  hereunder,  and  the
     indebtedness  evidenced  hereby shall be reduced by such amount so that the
     total liability for payments in the nature of interest, additional interest
     and other charges  shall not exceed the  applicable  limits  imposed by any
     applicable  usury laws, in compliance  with the desires of the Borrower and
     the Lender.  This  provision  shall never be superseded or waived and shall
     control  every other  provision of the Loan  Documents  and all  agreements
     between the Borrower and the Lender, or their successors and assigns.

     Section  2.7     Fees.
                      ----

          (a)  AMENDMENT  FEE.  The Borrower  hereby  agrees to pay the Lender a
     fully earned and  non-refundable  amendment fee of Three  Thousand  Dollars
     ($3,000) due and payable upon the execution of this Agreement.

          (b) UNUSED LINE FEE. For the purposes of this Section 2.7(b),  "Unused
                                                                          ------
     Amount"  means  the  Maximum  Line  reduced  by (1)  outstanding  Revolving
     ------
     Advances and (2) the L/C Amount.  The Borrower  agrees to pay to the Lender
     an unused line fee at the rate of  one-quarter  of one percent  (0.25%) per
     annum on the average  monthly Unused Amount from the date of this Agreement
     to and  including  the  Termination  Date,  due and  payable  quarterly  in
     arrears.

                                     - 14 -
<PAGE>
          (c) LETTER OF CREDIT FEES. The Borrower agrees to pay the Lender a fee
     with  respect to each Letter of Credit,  if any,  accruing on a daily basis
     and computed at the annual rate of two percent (2%) of the aggregate amount
     that may then be drawn on all  issued  and  outstanding  Letters  of Credit
     assuming  compliance  with  all  conditions  for  drawing  thereunder  (the
     "Aggregate  Face Amount"),  from and including the date of issuance of such
     Letter of Credit until such date as such Letter of Credit  shall  terminate
     by its terms or be  returned  to the  Lender,  due and  payable  monthly in
     advance  on the  first day of each  month.  The  foregoing  fee shall be in
     addition  to any and all fees,  commissions  and charges of any Issuer of a
     Letter of Credit  with  respect  to or in  connection  with such  Letter of
     Credit.

          (d) LETTER OF CREDIT  ADMINISTRATIVE  FEES. The Borrower agrees to pay
     the Lender,  on written  demand,  the  administrative  fees  charged by the
     Issuer  in  connection  with the  honoring  of drafts  under any  Letter of
     Credit,  amendments thereto,  transfers thereof and all other activity with
     respect to the Letters of Credit at the then-current rates published by the
     Issuer for such  services  rendered  on behalf of  customers  of the Issuer
     generally.

          (e) AUDIT FEES.  The  Borrower  hereby  agrees to pay the  Lender,  on
     demand,  reasonable  audit fees in connection with any standard bank audits
     or inspections  conducted by the Lender of any Collateral or the Borrower's
     operations  or business at the rates  established  from time to time by the
     Lender as its audit fees, together with all actual  out-of-pocket costs and
     expenses  incurred in  conducting  any such audit or  inspection  provided,
     however, that unless an Event of Default shall have occurred,  the Borrower
     shall be required to pay for no more than three (3) audits in any  calendar
     year.

          Section 2.8  Computation  of Interest and Fees;  When Interest Due and
                       ---------------------------------------------------------
Payable.  Interest accruing on the outstanding principal balance of the Advances
-------
and fees hereunder  outstanding from time to time shall be computed on the basis
of actual  number of days elapsed in a year of 360 days.  Interest  shall be due
and  payable in  arrears  on the first day of each month and on the  Termination
Date.

          Section 2.9 Capital Adequacy.  If any Related Lender determines at any
                      ----------------
time that its  Return  has been  reduced  as a result of any Rule  Change,  such
Related  Lender may  require  the  Borrower  to pay it the amount  necessary  to
restore its Return to what it would have been had there been no Rule Change. For
purposes of this Section 2.9:

          (a)  "Capital   Adequacy  Rule"  means  any  law,  rule,   regulation,
                ------------------------
     guideline, directive, requirement or request regarding capital adequacy, or
     the  interpretation  or  administration  thereof  by  any  governmental  or
     regulatory  authority,  central bank or comparable  agency,  whether or not
     having the force of law,  that  applies to any Related  Lender.  Such rules
     include rules requiring financial institutions to maintain total capital in
     amounts  based  upon  percentages  of  outstanding   loans,   binding  loan
     commitments and letters of credit.

          (b) "L/C Rule" means any law, rule, regulation,  guideline, directive,
               --------
     requirement or request regarding  letters of credit, or the  interpretation
     or  administration  thereof by any  governmental  or regulatory  authority,
     central bank or comparable agency,  whether or not having the force of law,
     that  applies to any Related  Lender.  Such rules  include  rules  imposing
     taxes,  duties or other similar  charges,  or mandating  reserves,  special
     deposits or similar  requirements  against assets of,  deposits with or for
     the account of, or credit  extended  by any Related  Lender,  on letters of
     credit.

                                     - 15 -
<PAGE>
          (c) "Return",  for any period,  means the return as determined by such
               ------
     Related  Lender on the  Advances and Letters of Credit based upon its total
     capital  requirements  and a  reasonable  attribution  formula  that  takes
     account of the Capital Adequacy Rules then in effect and cost of issuing or
     maintaining  any  Letter  of  Credit.  Return  may be  calculated  for each
     calendar  quarter and for the shorter  period between the end of a calendar
     quarter and the date of termination in whole of this Agreement.

          (d) "Rule Change" means any change in any Capital Adequacy Rule or L/C
               -----------
     Rule  occurring  after  the date of this  Agreement,  but the term does not
     include any changes in applicable requirements that at the Closing Date are
     scheduled to take place under the existing  Capital  Adequacy  Rules or L/C
     Rules or any  increases in the capital that any Related  Lender is required
     to  maintain  to the  extent  that  the  increases  are  required  due to a
     regulatory  authority's  assessment  of the  financial  condition  of  such
     Related Lender.

          (e) "Related Lender" includes (but is not limited to) the Lender,  the
               --------------
     Issuer, any parent corporation of the Lender or the Issuer and any assignee
     of any interest of the Lender  hereunder and any  participant  in the loans
     made hereunder.

Certificates  of  any  Related  Lender  sent  to  the Borrower from time to time
claiming  compensation  under  this Section 2.9, stating the reason therefor and
setting  forth  in reasonable detail the calculation of the additional amount or
amounts  to  be paid to the Related Lender hereunder to restore its Return shall
be  conclusive  absent manifest error.  In determining such amounts, the Related
Lender  may  use  any  reasonable  averaging  and  attribution  methods.

          Section  2.10     Maturity  Date. This Agreement and the other Loan
                            --------------
Documents  shall  become  effective  as  of the date set forth on the first page
hereof ("Effective Date") and shall continue in full force and effect for a term
ending  on December 10, 2001 (the "Maturity Date"), unless earlier terminated by
                                   -------------
Lender  or  Borrower  pursuant  to the terms hereof.  Upon the Termination Date,
Borrower  shall  immediately  pay to Lender, in full, all outstanding and unpaid
Obligations  and  shall  furnish  cash  collateral  to Lender in such amounts as
Lender  determines  are  reasonably  necessary to secure Lender from loss, cost,
damage  or  expense, including attorneys' fees and legal expenses, in connection
with  any  contingent  Obligations,  including  checks  and  other  payments
provisionally  credited to the Obligations and/or as to which Lender has not yet
received  final and indefeasible payment. Upon final and indefeasible payment in
full,  Lender shall promptly refund to Borrower any cash collateral then held by
Lender,  if  any.

          Section  2.11 Voluntary Prepayment; Reduction  of  the  Maximum Line;
                       ---------------------------------------------------------
Termination  of  the  Credit  Facility  by  the  Borrower.  Except  as otherwise
---------------------------------------------------------
provided  herein,  the  Borrower may prepay the Advances in whole at any time or
from time to time in part.  The Borrower may terminate the Credit Facility if it
(i)  gives  the  Lender  at least thirty (30) days prior written notice and (ii)
pays  the  Lender  termination or line reduction fees in accordance with Section
2.12.

     Section 2.12     Termination and Line Reduction Fees; Waiver of Termination
                      ----------------------------------------------------------
and  Line  Reduction  Fees.
--------------------------

          (a)  TERMINATION  AND LINE REDUCTION  FEES. If the Credit  Facility is
     terminated for any reason as of a date other than the Maturity Date, or the
     Borrower  reduces the Maximum Line,  the Borrower shall pay to the Lender a
     fee in an  amount  equal  to a  percentage  of the  Maximum  Line  (or  the
     reduction,  as the case may be) as follows:  (A) two percent  (2.0%) if the
     termination or reduction  occurs on or before the first  anniversary of the
     Funding Date; (B) one percent (1.0%) if the termination or reduction occurs
     after the first anniversary of the Funding Date but on or before the second
     anniversary of the Funding Date.

          (b) WAIVER OF TERMINATION  AND LINE REDUCTION  FEES. The Borrower will
     not be required to pay the termination or line reduction fees otherwise due
     under this  Section  2.12 if such  termination  or line  reduction  is made
     because of refinancing by an affiliate of the Lender.

          Section 2.13 Mandatory  Prepayment. Without  notice or demand, if the
                       ---------------------
sum  of the outstanding principal balance of the Revolving Advances plus the L/C
Amount  shall  at  any  time  exceed  the Borrowing Base, the Borrower shall (i)
first,  immediately  prepay  the  Revolving  Advances to the extent necessary to
eliminate  such excess; and (ii) if prepayment in full of the Revolving Advances
is  insufficient  to  eliminate  such  excess,  pay to the Lender in immediately
available  funds  for  deposit  in  the  Special  Account an amount equal to the
remaining excess.  Any payment received by the Lender under this Section 2.13 or
under  Section 2.11 may be applied to the Obligations, in such order and in such
amounts  as  the  Lender,  in  its  discretion, may from time to time determine.

         Section  2.14  Payment. For purposes of calculating the amount of
                        -------
Revolving  Advances  available  to  Borrower,   each  payment  will  be  applied
(conditional upon final collection) to the outstanding  principal balance of the
Revolving  Note on the Banking Day of receipt by Lender of advices of deposit in
the Collateral  Account, if such advices are received within sufficient time (in
accordance with Lender's usual and customary practices as in effect from time to
time) to credit  Borrower's  loan account on such day,  and if not,  then on the
next  Banking  Day.  Such  payment  shall be  applied  in any order or manner of
application satisfactory to Lender. For purposes of calculating interest, Lender
shall be entitled to charge  Borrower  for one (1)  Calendar Day of clearance at
the Floating Rate on all payments deposited into the Collateral Account, whether
or not such payments are applied to reduce the outstanding  principal balance of
the Revolving  Note.  This  clearance  charge is  acknowledged  to constitute an
integral  part  of  the  pricing  of  the  loans  and  financial  accommodations
contemplated  herein,  and shall  apply  whether or not the  amount of  payments
deposited  exceeds  the  obligations  outstanding.  Notwithstanding  anything in
Section 2.1, the Borrower hereby authorizes the Lender, in its discretion at any
time or from  time  to time  without  the  Borrower's  request  and  even if the
conditions set forth in Section 4.2 would not be satisfied,  to make a Revolving
Advance in an amount equal to the portion of the  Obligations  from time to time
due and payable.  At Lender's  option,  all principal,  interest,  fees,  costs,
expenses  and other  charges  provided  for in this  Agreement or the other Loan
Documents may be charged directly to the loan account(s) of Borrower.

                                     - 16 -
<PAGE>
         Section  2.15 Payment  on Non-Banking Days.  Whenever any payment to be
                       ----------------------------
made  hereunder  shall  be stated to be due on a day which is not a Banking Day,
such  payment may be made on the next succeeding Banking Day, and such extension
of  time  shall  in  such case be included in the computation of interest on the
Advances  or  the  fees  hereunder,  as  the  case  may  be.

         Section 2.16 Use of Proceeds.  All Advances made to Borrower and each
                      ---------------
Letter of Credit shall be used by Borrower only for general  operating,  working
capital and other proper corporate purposes of Borrower not otherwise prohibited
by the terms hereof.

         Section  2.17 Liability Records. The Lender may maintain from time to
                       -----------------
time, at its discretion,  liability  records as to the Obligations.  All entries
made on any such record shall be presumed correct until the Borrower establishes
the contrary.  Upon the Lender's demand,  the Borrower will admit and certify in
writing the exact principal  balance of the  Obligations  that the Borrower then
asserts to be outstanding.  Any billing statement or accounting  rendered by the
Lender shall be conclusive and fully binding on the Borrower unless the Borrower
gives the Lender  specific  written notice of exception  within thirty (30) days
after receipt or in the case of manifest error.

         Section 2.18     Deactivation of Credit Facility.  So long as no
                          -------------------------------

obligations  are  outstanding,  Borrower may deactivate the Credit Facility (any
period during which the Credit Facility is deactivated  pursuant to this Section
2.18 shall  hereinafter be referred to as, a  "Deactivation  Period");  provided
                                                                        --------
that, if a Deactivation  Period commences within thirty (30) days after the date
----
hereof,  Borrower  shall give Lender prior  written  notice of its  intention to
deactivate  the  Credit  Facility  promptly  upon  knowledge  thereof  and  if a
Deactivation  Period  commences  after  thirty  (30)  days of the  date  hereof,
Borrower  shall  give  Lender  thirty  (30)  days  prior  written  notice of its
intention to  deactivate  the Credit  Facility.  During a  Deactivation  Period,
Lender's Commitment shall not be in effect, and the charges pursuant to sections
2.6(b) and 2.7(b) and the clearance charge referred to in section 2.14 shall not
be applied.  Notwithstanding  any provisions in the Collection Account Agreement
or the Lockbox  Agreement,  Borrower may receive all payments on  Receivables or
payments  constituting  proceeds  of  other  Collateral  directly  (rather  than
depositing  or  directing  its account  debtors or other  obligors to remit such
payment  or  proceeds  to the  Lockbox  or the  Collateral  Account).  Except as
provided in Section 2.3(c) of this Agreement, a Deactivation Period shall remain
in effect until the date thirty (30) days after the Borrower notifies the Lender
that it  desires  to  reactivate  the  Credit  Facility.  No more than three (3)
Deactivation Periods may be initiated by Borrower within a calendar year. During
a  Deactivation  Period,  Borrower  shall  continue to comply with the reporting
requirements set forth in Section 6.1 of this Agreement.

                                     - 17 -
<PAGE>
                                   ARTICLE III

                      Security Interest; Occupancy; Setoff
                      ------------------------------------

     Section  3.1     Grant  of Security Interest.  The Borrower hereby pledges,
                      ---------------------------
assigns  and  grants to the Lender a security interest (collectively referred to
as  the  "Security Interest") in the Collateral, as security for the payment and
          -----------------
performance  of  the  Obligations.

     Section  3.2     Notification  of Account Debtors and Other Obligors.  Upon
                      ---------------------------------------------------
the  occurrence of an Event of Default, the Lender may notify any account debtor
or  other  person obligated to pay the amount due that such right to payment has
been  assigned  or  transferred  to  the  Lender  for security and shall be paid
directly  to  the  Lender.  The  Borrower will join in giving such notice if the
Lender  so  requests.  At  any  time after the Borrower or the Lender gives such
notice  to  an account debtor or other obligor, the Lender may, but need not, in
the  Lender's  name  or  in the Borrower's name, (a) demand, sue for, collect or
receive  any  money or property at any time payable or receivable on account of,
or  securing,  any  such  right  to payment, or grant any extension to, make any
compromise  or  settlement  with  or  otherwise agree to waive, modify, amend or
change  the  obligations  (including collateral obligations) of any such account
debtor  or  other obligor; and (b) as the Borrower's agent and attorney in fact,
notify  the  United  States Postal Service to change the address for delivery of
the Borrower's mail to any address designated by the Lender, otherwise intercept
the  Borrower's  mail,  and receive, open and dispose of the Borrower's mail for
purposes  of  the collection of Collateral, applying all Collateral as permitted
under  this  Agreement  and holding all other mail for the Borrower's account or
forwarding  such  mail  to  the  Borrower's  last  known  address.

Section 3.3     Assignment of Insurance.  As additional security for the payment
                -----------------------
and  performance  of  the Obligations, the Borrower hereby assigns to the Lender
any  and  all  monies  (including, without limitation, proceeds of insurance and
refunds  of  unearned premiums) due or to become due under, and all other rights
of the Borrower with respect to, any and all policies of insurance now or at any
time  hereafter  covering the Collateral or any evidence thereof or any business
records  or  valuable papers pertaining thereto, and the Borrower hereby directs
the issuer of any such policy to pay all such monies directly to the Lender.  At
any  time, whether or not a Default Period then exists, the Lender may (but need
not),  in the Lender's name or in the Borrower's name, execute and deliver proof
of  claim,  receive  all  such  monies  and endorse checks and other instruments
representing  payment  of  such monies.  Following the occurrence of an Event of
Default,  the  Lender  may  (but  need  not),  in  the  Lender's  name or in the
Borrower's  name,  adjust, litigate, compromise or release any claim against the
issuer  of  any  such  policy.

     Section  3.4     Occupancy.
                      ---------

          (a) The Borrower hereby  irrevocably grants to the Lender the right to
     take  possession of the Premises at any time following the occurrence of an
     Event of Default.

          (b)  The  Lender  may  use  the  Premises   only  to  hold,   process,
     manufacture, sell, use, store, liquidate, realize upon or otherwise dispose
     of goods that are  Collateral and for other purposes that the Lender may in
     good faith deem to be related or incidental purposes.

                                     - 18 -
<PAGE>
          (c) The Lender's  right to hold the Premises shall cease and terminate
     upon the earlier of (i) payment in full and  discharge  of all  Obligations
     and  termination of the  Commitment,  (ii) final sale or disposition of all
     goods constituting  Collateral and delivery of all such goods to purchasers
     and (iii) the waiver of such Event of Default.

          (d) The Lender  shall not be  obligated to pay or account for any rent
     or other  compensation  for the possession,  occupancy or use of any of the
     Premises; provided, however, that if the Lender does pay or account for any
     rent or other  compensation for the possession,  occupancy or use of any of
     the Premises, the Borrower shall reimburse the Lender promptly for the full
     amount thereof. In addition, the Borrower will pay, or reimburse the Lender
     for, all taxes,  fees,  duties,  imposts,  charges and expenses at any time
     incurred  by or  imposed  upon  the  Lender  by  reason  of the  execution,
     delivery,  existence,  recordation,  performance  or  enforcement  of  this
     Agreement or the provisions of this Section 3.4.

          Section 3.5 License. Without limiting the generality of the Patent and
                      -------
Trademark  Security  Agreement,  the  Borrower  hereby  grants  to  the Lender a
non-exclusive,  worldwide  and  royalty-free license to use or otherwise exploit
all  trademarks, franchises, trade names, copyrights and patents of the Borrower
for  the  purpose  of  selling,  leasing  or  otherwise  disposing of any or all
Collateral  during  any  Default  Period.

          Section  3.6 Financing  Statement. A  carbon,  photographic  or  other
                       --------------------
reproduction  of  this  Agreement  or  of any financing statements signed by the
Borrower  is sufficient as a financing statement and may be filed as a financing
statement  in  any  state to perfect the security interests granted hereby.  For
this  purpose,  the  following  information  is  set  forth:
Name  and  address  of  Debtor:

          Rockshox,  Inc.
          1610  Garden  of  the  Gods  Road
          Colorado  Springs,  Colorado  80907

          Federal  Tax  Identification  No.  77-0396555
          Name  and  address  of  Secured  Party:

          Wells  Fargo  Business  Credit,  Inc.
          245  South  Los  Robles  Avenue,  Suite  600
          Pasadena,  California  91101

     Section  3.7     Setoff.  The  Borrower agrees that, upon the occurrence of
                      ------
an  Event  of Default, the Lender may, at its sole discretion and without demand
and  without  notice to anyone, setoff any liability owed to the Borrower by the
Lender,  whether  or  not  due,  against any Obligation, whether or not due.  In
addition,  each other Person holding a participating interest in any Obligations
shall  have  the  right  to appropriate or setoff any deposit or other liability
then owed by such Person to the Borrower, whether or not due, and apply the same
to  the  payment  of said participating interest, as fully as if such Person had
lent  directly  to  the  Borrower  the  amount  of  such participating interest.

                                     - 19 -
<PAGE>
                                   ARTICLE IV

                              Conditions of Lending
                              ---------------------
     Section  4.1     Conditions  Precedent to the Initial Revolving Advance and
                      ----------------------------------------------------------
the  Initial  Letter  of  Credit.  The  Lender's  obligation to make the initial
 -------------------------------
Revolving  Advance  or  to  cause  to  be  issued  the  initial Letter of Credit
hereunder shall be subject to the condition precedent that the Lender shall have
received  all  of  the following, each in form and substance satisfactory to the
Lender:

          (a) This Agreement, properly executed by the Borrower.

          (b) A true  and  correct  copy of the  lease  pursuant  to  which  the
     Borrower has leased the Premises, together with a landlord's disclaimer and
     consent with respect to such lease.

          (c) Current searches of appropriate filing offices showing that (i) no
     state or federal tax liens have been filed and remain in effect against the
     Borrower,   (ii)  no  financing   statements  or  assignments  of  patents,
     trademarks or copyrights  have been filed and remain in effect  against the
     Borrower  except those  financing  statements  and  assignments of patents,
     trademarks  or copyrights  relating to Permitted  Liens or to liens held by
     Persons  who have  agreed in writing  that upon  receipt of proceeds of the
     Advances,  they will deliver UCC releases and/or  terminations and releases
     of such  assignments of patents,  trademarks or copyrights  satisfactory to
     the Lender,  and (iii) the Lender has duly filed all  financing  statements
     necessary  to perfect the  Security  Interest,  to the extent the  Security
     Interest is capable of being perfected by filing.

          (d) A true and  correct  copy of any and all  agreements  pursuant  to
     which the Borrower's property is in the possession of any Person other than
     the Borrower, together with, (i) an acknowledgment and waiver of liens from
     each  subcontractor who has possession of the Borrower's goods from time to
     time,  (ii) UCC financing  statements  sufficient to protect the Borrower's
     and the Lender's  interests in such goods,  and (iii) UCC searches  showing
     that no other secured party has filed a financing  statement  covering such
     Person's  property  other than the  Borrower,  or if there  exists any such
     secured  party,  evidence that each such secured party has received  notice
     from the Borrower and the Lender  sufficient to protect the  Borrower's and
     the  Lender's  interests  in the  Borrower's  goods  from any claim by such
     secured party.

          (e) A certificate  of an officer of the Borrower  confirming  that the
     representations  and warranties set forth in Article V are true and correct
     in all material respects.

          (f)  Payment of the fees and  commissions  due through the date of the
     initial  Advance  under  Section  2.7 and  expenses  incurred by the Lender
     through  such date and required to be paid by the  Borrower  under  Section
     9.6, including  reasonable legal expenses incurred through the date of this
     Agreement.

                                     - 20 -
<PAGE>
          (g) Such other documents as the Lender may reasonably require.

     Section 4.2     Conditions Precedent to All Advances and Letters of Credit.
                     ----------------------------------------------------------
The Lender's obligation to make each Advance or to cause the Issuer to issue any
Letter  of  Credit  shall be subject to the further conditions precedent that on
such  date:

          (a) the  representations  and  warranties  contained  in Article V are
     correct in all  material  respects on and as of the date of such Advance or
     issuance of Letter of Credit as though made on and as of such date,  except
     to the extent that such  representations and warranties relate solely to an
     earlier date;

          (b) no material  adverse change,  as determined by Lender,  shall have
     occurred  in the  financial  condition  or  business  of  Borrower  nor any
     material  decline,  as  determined  by Lender,  in the market  value of any
     Collateral or a substantial  or material  portion of the assets of Borrower
     since the date of the latest financial statements delivered to Lender prior
     to the Funding Date; and

          (c) no event has occurred and is continuing, or would result from such
     Advance or the issuance of such Letter of Credit, as the case may be, which
     constitutes a Default or an Event of Default.

                                    ARTICLE V

                         Representations and Warranties
                         ------------------------------

The  Borrower  represents  and  warrants  to  the  Lender  as  follows:

     Section  5.1     Corporate  Existence  and  Power;  Name;  Chief  Executive
                      ----------------------------------------------------------
Office;  Inventory  and  Equipment  Locations;  Tax  Identification Number.  The
      --------------------------------------------------------------------
Borrower is a corporation, duly organized, validly existing and in good standing
under  the  laws  of  the State of Delaware and is duly licensed or qualified to
transact business in all jurisdictions where the character of the property owned
or leased or the nature of the business transacted by it makes such licensing or
qualification  necessary.  The  Borrower  has all requisite power and authority,
corporate  or  otherwise,  to conduct its business, to own its properties and to
execute  and  deliver,  and  to  perform  all of its obligations under, the Loan
Documents.  During  its  existence,  the Borrower has done business solely under
the  names  set  forth  in  Schedule 5.1 hereto.  The Borrower's chief executive
                            ------------
office  and  principal  place of business is located at the address set forth in
Schedule  5.1 hereto, and all of the Borrower's records relating to its business
-------------
or  the  Collateral  are  kept at that location.  All Inventory and Equipment is
located  at that location or at one of the other locations set forth in Schedule
                                                                        --------
5.1  hereto.  The Borrower's tax identification number is correctly set forth in
---
Section  3.6  hereto.

     Section  5.2     Authorization  of  Borrowing;  No  Conflict  as  to Law or
                      ----------------------------------------------------------
Agreements.  The execution, delivery and performance by the Borrower of the Loan
----------
Documents  and  the  borrowings  from  time  to  time  hereunder  have been duly
authorized by all necessary corporate action and do not and will not (i) require
any  consent  or  approval  of  the  Borrower's  stockholders;  (ii) require any
authorization,  consent  or  approval by, or registration, declaration or filing

                                     - 21 -
<PAGE>
with,  or  notice  to,  any  governmental department, commission, board, bureau,
agency  or instrumentality, domestic or foreign, or any third party, except such
authorization, consent, approval, registration, declaration, filing or notice as
has been obtained, accomplished or given prior to the date hereof; (iii) violate
any  provision  of  any  law, rule or regulation (including, without limitation,
Regulation  X of the Board of Governors of the Federal Reserve System) or of any
order,  writ,  injunction  or decree presently in effect having applicability to
the  Borrower  or  of  the  Borrower's articles of incorporation or bylaws; (iv)
result  in  a  breach  of or constitute a default under any indenture or loan or
credit  agreement  or any other material agreement, lease or instrument to which
the  Borrower  is  a  party  or  by  which  it or its properties may be bound or
affected;  or  (v)  result  in,  or  require,  the creation or imposition of any
mortgage,  deed  of  trust,  pledge,  lien, security interest or other charge or
encumbrance  of  any  nature  (other  than  the  Security Interest) upon or with
respect  to  any  of  the  properties  now  owned  or  hereafter acquired by the
Borrower.

     Section  5.3  Legal  Agreements. This Agreement  constitutes  and, upon due
                   -----------------
execution  by  the Borrower, the other Loan Documents will constitute the legal,
valid  and binding obligations of the Borrower, enforceable against the Borrower
in  accordance  with  their  respective  terms.

     Section  5.4   Subsidiaries.  Except  as  set  forth in Schedule 5.4, the
                    ------------                             ------------
Borrower  has  no  Subsidiaries.

     Section  5.5   Financial  Condition;  No  Adverse  Change. The Borrower has
                    ------------------------------------------
heretofore  furnished to the Lender audited financial statements of the Borrower
for  its  fiscal year ended March 31, 1999 and unaudited financial statements of
the  Borrower  for  the  fiscal  year ended March 31, 2000, and those statements
fairly  present  the Borrower's financial condition on the dates thereof and the
results  of  its  operations  and cash flows for the periods then ended and were
prepared  in  accordance  with GAAP (subject, in the case of unaudited financial
statements,  to  the  absence of footnotes and year-end adjustments).  Since the
date of the most recent financial statements, there has been no material adverse
change  in  the  Borrower's  business,  properties  or  condition  (financial or
otherwise).

     Section 5.6  Litigation. There are no actions, suits or proceedings pending
                  ----------
or, to the Borrower's knowledge, threatened against or affecting the Borrower or
any of its Affiliates or the properties of the Borrower or any of its Affiliates
before  any  court or governmental department, commission, board, bureau, agency
or  instrumentality,  domestic or foreign, which could reasonably be expected to
have  a  material  adverse  effect  on  the  financial  condition, properties or
operations  of  the  Borrower  or  any  of  its  Affiliates.

     Section  5.7  Regulation U.  The Borrower is not engaged in the business of
                   -------------
extending  credit for the purpose of purchasing or carrying margin stock (within
the  meaning  of  Regulation  U of the Board of Governors of the Federal Reserve
System,  as amended), and no part of the proceeds of any Advance will be used to
purchase or carry any margin stock or to extend credit to others for the purpose
of  purchasing  or carrying any margin stock or to retire any indebtedness which
was  originally  incurred to purchase or carry any margin stock or for any other
purpose  which  might  cause  any  of  the  Advances to be considered a "purpose
credit"  within  the  meaning  of  Regulation U of the Board of Governors of the
Federal  Reserve  System,  as  amended.

                                     - 22 -
<PAGE>
     Section  5.8  Taxes. The Borrower and its Affiliates have paid or caused to
                   -----
be  paid  to  the proper authorities when due all federal, state and local taxes
required  to  be withheld by each of them.  The Borrower and its Affiliates have
filed  all  federal,  state  and local tax returns reflecting tax liabilities in
excess  of $50,000 which to the knowledge of the officers of the Borrower or any
Affiliate,  as  the  case may be, are required to be filed, and the Borrower and
its  Affiliates  have  paid  or  caused  to  be  paid  to  the respective taxing
authorities  all taxes as shown on said returns or on any assessment received by
any  of  them  to  the  extent  such  taxes have become due except such taxes or
assessments,  if  any,  as  are  being  contested  in good faith and as to which
adequate  reserves  have  been  provided  in  accordance  with  GAAP.

     Section 5.9  Titles and Liens.  The Borrower has good and absolute title
                  ----------------
to  all Collateral described in the collateral reports provided to the Lender at
the  time  of  delivery  hereof  and all other Collateral, properties and assets
reflected  in the latest financial statements referred to in Section 5.5 and all
proceeds thereof, free and clear of all mortgages, security interests, liens and
encumbrances,  except  for  Permitted  Liens.  No financing statement naming the
Borrower  as  debtor  is  on file in any office except to perfect only Permitted
Liens.

     Section  5.10  Plans. Except as disclosed to the Lender in writing prior to
                    -----
the date hereof, neither the Borrower nor any of its Affiliates maintains or has
maintained  any  Plan.  Neither  the Borrower nor any Affiliate has received any
notice or has any knowledge to the effect that it is not in full compliance with
any  of  the  requirements  of  ERISA.  No  Reportable  Event  or  other fact or
circumstance which may have an adverse effect on the Plan's tax qualified status
exists  in  connection  with  any  Plan.  Neither  the  Borrower  nor any of its
Affiliates  has:

          (a) Any accumulated funding deficiency within the meaning of ERISA; or

          (b) Any  liability or knows of any fact or  circumstances  which could
     result in any liability to the Pension Benefit  Guaranty  Corporation,  the
     Internal  Revenue  Service,  the Department of Labor or any  participant in
     connection  with any Plan (other than accrued  benefits  which or which may
     become payable to participants or beneficiaries of any such Plan).

     Section  5.11     Default.  The  Borrower  is  in  compliance  with  all
                       -------
provisions  of  all agreements, instruments, decrees and orders to which it is a
party or by which it or its property is bound or affected, the breach or default
of  which  could  have  a  material  adverse  effect on the Borrower's financial
condition,  properties  or  operations.

     Section  5.12     Environmental  Matters.
                       ----------------------

          (a) Definitions.  As used in this Agreement, the following terms shall
              -----------
     have the following meanings:

                                     - 23 -
<PAGE>
               (i) "Environmental Law" means any federal,  state, local or other
                    -----------------
          governmental  statute,  regulation,  law or ordinance dealing with the
          protection of human health and the environment.

               (ii)  "Hazardous  Substances"  means  pollutants,   contaminants,
                      ---------------------
          hazardous  substances,   hazardous  wastes,  petroleum  and  fractions
          thereof,  and all other  chemicals,  wastes,  substances and materials
          listed in, regulated by or identified in any Environmental Law.

          (b)  Except as would not  reasonably  be  expected  to have a material
     adverse effect, to the Borrower's best knowledge, there are not present in,
     on or under the Premises any Hazardous  Substances in such form or quantity
     as to create any  liability  or  obligation  for either the Borrower or the
     Lender under common law of any jurisdiction or under any Environmental Law,
     and no Hazardous Substances have ever been stored, buried, spilled, leaked,
     discharged,  emitted or released in, on or under the Premises in such a way
     as to create any such liability.

          (c) To the Borrower's best knowledge, the Borrower has not disposed of
     Hazardous  Substances in such a manner as to create any liability exceeding
     $100,000, individually or in the aggregate, under any Environmental Law.

          (d)  Except as would not  reasonably  be  expected  to have a material
     adverse effect,  there are not now and, since  Borrower's  occupancy of the
     Premises,   there   never  have  been  any   requests,   claims,   notices,
     investigations,    demands,   administrative   proceedings,   hearings   or
     litigation,  relating in any way to the Premises or the Borrower,  alleging
     liability under,  violation of, or noncompliance with any Environmental Law
     or any license,  permit or other authorization  issued pursuant thereto. To
     the Borrower's best knowledge, no such matter is threatened or impending.

          (e) To the Borrower's  best knowledge,  the Borrower's  businesses are
     and  have  in the  past  always  been  conducted  in  accordance  with  all
     Environmental  Laws and all  licenses,  permits  and  other  authorizations
     required pursuant to any Environmental Law and necessary for the lawful and
     efficient operation of such businesses are in the Borrower's possession and
     are in full force and effect except,  in each case, as would not reasonable
     be expected to result in a material adverse effect.

          (f) To the Borrower's best  knowledge,  the Premises are not and never
     have  been  listed  on the  National  Priorities  List,  the  Comprehensive
     Environmental  Response,  Compensation and Liability  Information System or
     any similar  federal,  state or local list,  schedule,  log,  inventory  or
     database.

          (g) The Borrower has delivered to Lender,  to the extent  Borrower has
     such  items  in its  possession,  all  environmental  assessments,  audits,
     reports,  permits  and  licenses  describing  or relating in any way to the
     Premises or Borrower's businesses.

                                     - 24 -
<PAGE>
           Section  5.13 Submissions  to  Lender.  All  financial  and  other
                         -----------------------
information provided to the Lender by or on behalf of the Borrower in connection
with  the  Borrower's  request  for the credit facilities contemplated hereby is
true  and correct in all material respects and, as to projections, valuations or
proforma  financial  statements, are based on assumptions made in good faith (it
being  acknowledged  by  the  Lender  that  no  assurance can be given that such
projections,  valuations,  or  proforma  results  will  be  realized).

           Section  5.14 Financing  Statements. The Borrower has provided to the
                         ---------------------
Lender signed financing statements sufficient when filed to perfect the Security
Interest  and  the  other  security interests created by the Security Documents.
When  such  financing  statements  are  filed  in the offices noted therein, the
Lender  will  have a valid and perfected security interest in all Collateral and
all  other  collateral  described  in the Security Documents which is capable of
being perfected by filing financing statements.  None of the Collateral or other
collateral covered by the Security Documents is or will become a fixture on real
estate,  unless  a  sufficient fixture filing is in effect with respect thereto.

           Section  5.15 Rights to Payment.  Each right to payment and each
                         -----------------
instrument,   document,  chattel  paper  and  other  agreement  constituting  or
evidencing  Collateral or other collateral  covered by the Security Documents is
(or, in the case of all future Collateral or such other collateral, will be when
arising or issued)  the  valid,  genuine  and  legally  enforceable  obligation,
subject to no  defense,  setoff or  counterclaim,  of the account  debtor  named
therein or in the Borrower's  records  pertaining  thereto as being obligated to
pay such obligation.

                                   ARTICLE VI

                        Borrower's Affirmative Covenants
                        --------------------------------

So  long  as  the  Obligations shall remain unpaid, or the Credit Facility shall
remain  outstanding,  the  Borrower will comply with the following requirements,
unless  the  Lender  shall  otherwise  consent  in  writing:

     Section  6.1     Reporting  Requirements.  The  Borrower  will  deliver, or
                      -----------------------
cause  to  be  delivered, to the Lender each of the following, which shall be in
form  and  detail  acceptable  to  the  Lender:

          (a) as soon as  available,  and in any event  within  ninety (90) days
     after the end of each fiscal year of the Borrower,  the Borrower's  audited
     financial statements with the unqualified opinion of independent  certified
     public  accountants  selected by the Borrower and acceptable to the Lender,
     which annual  financial  statements  shall include the  Borrower's  balance
     sheet as at the end of such fiscal year and the related  statements  of the
     Borrower's  income,  retained  earnings  and cash flows for the fiscal year
     then ended,  prepared,  if the Lender so requests,  on a consolidating  (if
     applicable) and consolidated basis to include any subsidiaries of Borrower,
     all in  reasonable  detail and prepared in accordance  with GAAP,  together
     with (i) copies of all management letters prepared by such accountants; and
     (ii) a certificate of the Borrower's  chief financial  officer stating that
     such financial  statements  have been prepared in accordance  with GAAP and
     whether or not such officer has knowledge of the  occurrence of any Default
     or Event of Default  hereunder and, if so, stating in reasonable detail the
     facts with respect thereto;

                                     - 25 -
<PAGE>
          (b) as soon as  available  and in any event  within  thirty  (30) days
     after  the end of each  month,  financial  statements,  unaudited  internal
     balance  sheet  and  statements  of income  and  retained  earnings  of the
     Borrower  as at the  end of and for  such  month  and for the  year to date
     period then ended,  prepared, if the Lender so requests, on a consolidating
     (if  applicable)  and  consolidated  basis to include any  subsidiaries  of
     Borrower,  in reasonable detail and stating in comparative form the figures
     for the  corresponding  date and periods in the previous year, all prepared
     in  accordance  with  GAAP,  subject to  year-end  audit  adjustments;  and
     accompanied  by a certificate of the Borrower's  chief  financial  officer,
     substantially  in the form of  Exhibit  B  hereto  stating  (i)  that  such
     financial statements have been prepared in accordance with GAAP, subject to
     year end audit adjustments,  (ii) whether or not such officer has knowledge
     of the  occurrence  of any  Default  or  Event  of  Default  hereunder  not
     theretofore  reported and remedied and, if so, stating in reasonable detail
     the facts with respect thereto,  and (iii) all relevant facts in reasonable
     detail to evidence, and the computations as to, whether or not the Borrower
     is in compliance with the requirements set forth in Sections 6.12, 6.13 and
     7.10;

          (c) within ten (10) days after the end of each month and weekly during
     a Deactivation Period when one or more Letter of Credit has been issued and
     remains  outstanding or more frequently if the Lender so requires after the
     occurrence  of an Event  of  Default,  agings  of the  Borrower's  accounts
     receivable  and its accounts  payable and a calculation  of the  Borrower's
     Accounts and Eligible  Accounts as at the end of such month or shorter time
     period;

          (d) at least thirty (30) days before the beginning of each fiscal year
     of the Borrower,  the projected  balance  sheets and income  statements for
     each  month of such  year,  each in  reasonable  detail,  representing  the
     Borrower's  good faith  projections  and certified by the Borrower's  chief
     financial  officer  as being  the most  recent  projections  available  and
     identical to the  projections  used by the  Borrower for internal  planning
     purposes,  together with such  supporting  schedules and information as the
     Lender may reasonably require;

          (e) as soon as possible and in any event within 10 days after  receipt
     of notice thereof by the Borrower,  notice in writing of all litigation and
     of all proceedings  before any governmental or regulatory  agency affecting
     the Borrower of the type described in Section 5.12 or which seek a monetary
     recovery in excess of One Hundred Thousand Dollars ($100,000).

          (f) as  promptly as  practicable  (but in any event not later than ten
     Banking  Days) after an officer of the  Borrower  obtains  knowledge of the
     occurrence  of any breach,  default or event of default  under any Security
     Document  or any event  which  constitutes  a Default  or Event of  Default
     hereunder, notice of such occurrence, together with a detailed statement by
     a  responsible  officer of the  Borrower  of the steps  being  taken by the
     Borrower to cure the effect of such breach, default or event;

          (g) as soon as possible and in any event within thirty (30) days after
     the  Borrower  knows or has reason to know that any  Reportable  Event with
     respect to any Plan has  occurred,  the statement of the  Borrower's  chief
     financial officer setting forth details as to such Reportable Event and the
     action which the Borrower  proposes to take with respect thereto,  together
     with a copy of the notice of such  Reportable  Event to the Pension Benefit
     Guaranty Corporation;

                                     - 26 -
<PAGE>
          (h) as soon as  possible,  and in any event within ten (10) days after
     the Borrower fails to make any quarterly contribution required with respect
     to any Plan under Section  412(m) of the Internal  Revenue Code of 1986, as
     amended,  the statement of the Borrower's  chief financial  officer setting
     forth details as to such failure and the action which the Borrower proposes
     to take with respect  thereto,  together  with a copy of any notice of such
     failure   required  to  be  provided  to  the  Pension   Benefit   Guaranty
     Corporation;

          (i) promptly  upon  knowledge  thereof,  notice of (i) any disputes or
     claims by the Borrower's  customers in which the disputed amount or amounts
     exceeds an aggregate amount of $100,000; (ii) credit memos; (iii) any goods
     returned to or recovered by the Borrower other than in the ordinary  course
     of business ; and(iv) any change in the persons constituting the Borrower's
     senior executive officers and directors;

          (j) promptly upon knowledge thereof, notice of any loss of or material
     damage  to any  Collateral  or other  collateral  covered  by the  Security
     Documents or of any  substantial  adverse  change in any Collateral or such
     other collateral or the prospect of payment thereof to the extent the value
     of such loss,  damage or adverse change or any combination  thereof exceeds
     $100,000;

          (k)  within  ten  (10)  days  of  their  distribution,  copies  of all
     financial statements, reports and proxy statements which the Borrower shall
     have sent to its stockholders;

          (l) within ten (10) days of sending or filing  thereof,  copies of all
     regular  and  periodic  reports  which  the  Borrower  shall  file with the
     Securities and Exchange Commission or any national securities exchange;

          (m)  promptly  upon  knowledge  thereof,   notice  of  the  Borrower's
     violation of any law, rule or  regulation,  the  non-compliance  with which
     could  materially  and  adversely  affect the  Borrower's  business  or its
     financial condition; and

          (n)  from  time  to  time,  with  reasonable  promptness,  any and all
     receivables  schedules,  collection  reports,  deposit  records,  equipment
     schedules,  copies of invoices to account debtors,  shipment  documents and
     delivery receipts for goods sold, and such other material, reports, records
     or  information as the Lender may reasonably  request,  including,  without
     limitation, weekly borrowing base certificates.

                                     - 27 -
<PAGE>
          Section 6.2 Books and Records;  Inspection  and  Examination.  The
                      -------------------------------------------------
Borrower will keep accurate books of record and account for itself pertaining to
the Collateral and pertaining to the Borrower's business and financial condition
in  which  true  and  complete entries will be made in accordance with GAAP and,
upon  the  Lender's  request,  will  permit  any  officer, employee, attorney or
accountant  for  the Lender to audit, review, make extracts from or copy any and
all  corporate  and  financial  books  and  records of the Borrower at all times
during  ordinary  business hours and upon reasonable notice, to send and discuss
with  account  debtors  and  other obligors requests for verification of amounts
owed  to  the  Borrower,  and  to discuss the Borrower's affairs with any of its
directors,  officers, employees or agents.  The Borrower will permit the Lender,
or  its  employees, accountants, attorneys or agents, to examine and inspect any
Collateral,  other  collateral  covered  by  the Security Documents or any other
property  of  the  Borrower  at any time during ordinary business hours and upon
reasonable  notice.

          Section 6.3 Account Verification. The Lender may at any time and from
                      --------------------
time to time send or require the Borrower to send requests for  verification  of
accounts or notices of assignment  to account  debtors and other  obligors.  The
Lender may also at any time and from time to time telephone  account debtors and
other obligors to verify accounts.

          Section  6.4     Compliance  with  Laws.
                      ----------------------

          (a) The Borrower will (i) comply with the  requirements  of applicable
     laws and regulations,  the  non-compliance  with which would materially and
     adversely  affect its business or its financial  condition and (ii) use and
     keep the  Collateral,  and require that others use and keep the Collateral,
     only for lawful purposes,  without violation of any federal, state or local
     law, statute or ordinance.

          (b)  Without  limiting  the  foregoing   undertakings,   the  Borrower
     specifically  agrees that it will comply with all applicable  Environmental
     Laws and obtain and comply with all permits, licenses and similar approvals
     required by any Environmental Laws, and will not generate,  use, transport,
     treat, store or dispose of any Hazardous  Substances in such a manner as to
     create any liability or obligation under the common law of any jurisdiction
     or any Environmental Law except as would not reasonably be expected to have
     a material adverse effect.

          Section 6.5 Payment  of Taxes and Other Claims.  The Borrower will pay
                      ----------------------------------
or  discharge,  when  due,  (a) all material taxes, assessments and governmental
charges  levied  or  imposed  upon  it  or  upon its income or profits, upon any
properties  belonging  to  it (including, without limitation, the Collateral) or
upon  or  against  the  creation,  perfection  or  continuance  of  the Security
Interest,  prior to the date on which penalties attach thereto, (b) all federal,
state  and  local taxes required to be withheld by it, and (c) all lawful claims
for  labor,  materials and supplies which, if unpaid, might by law become a lien
or charge upon any properties of the Borrower; provided, that the Borrower shall
not  be  required to pay any such tax, assessment, charge or claim whose amount,
applicability  or  validity  is  being  contested  in  good faith by appropriate
proceedings  and  for  which  proper  reserves  have  been  made.

          Section  6.6     Maintenance  of  Properties.
                           ---------------------------

          (a) The  Borrower  will keep and maintain  the  Collateral,  the other
     collateral  covered  by  the  Security  Documents  and  all  of  its  other
     properties  necessary or useful in its business in good  condition,  repair
     and working  order  (normal wear and tear  excepted)  and will from time to
     time  replace  or repair any worn,  defective  or broken  parts;  provided,
     however,  that nothing in this Section 6.6 shall  prevent the Borrower from
     discontinuing  the operation and  maintenance  of any of its  properties if
     such  discontinuance  is,  in the  Borrower's  judgment,  desirable  in the
     conduct of the Borrower's  business and not disadvantageous in any material
     respect to the Lender.

                                     - 28 -
<PAGE>
          (b) The  Borrower  will  defend the  Collateral  against all claims or
     demands of all  persons  (other  than the Lender and  holders of  Permitted
     Liens) claiming the Collateral or any interest therein.

          (c) The Borrower will keep all Collateral and other collateral covered
     by the Security Documents free and clear of all security  interests,  liens
     and encumbrances except Permitted Liens.

     Section  6.7     Insurance.  The  Borrower  will  obtain  and  at all times
                      ---------
maintain  insurance with insurers believed by the Borrower to be responsible and
reputable,  in  such  amounts and against such risks as may from time to time be
reasonably required by the Lender, but in all events in such amounts and against
such  risks  as  is usually carried by companies engaged in similar business and
owning  similar  properties  in  the  same  general  areas in which the Borrower
operates.  Without  limiting  the generality of the foregoing, the Borrower will
at  all  times  maintain  business interruption insurance including coverage for
force  majeure  and  keep  all tangible Collateral insured against risks of fire
(including  so-called  extended  coverage),  theft,  collision  (for  Collateral
consisting  of  motor  vehicles) and such other risks and in such amounts as the
Lender may reasonably request, with any loss payable to the Lender to the extent
of  its  interest,  and  all policies of such insurance shall contain a lender's
loss payable endorsement for the Lender's benefit acceptable to the Lender.  All
policies  of  liability insurance required hereunder shall name the Lender as an
additional  insured.

     Section  6.8     Preservation of Existence.  The Borrower will preserve and
                      -------------------------
maintain  its  existence  and  all  of  its  rights,  privileges  and franchises
necessary  or  desirable in the normal conduct of its business and shall conduct
its  business  in  an  orderly,  efficient  and  regular  manner.

Section  6.9     Delivery  of Instruments, etc.  Upon request by the Lender, the
                 -----------------------------
Borrower  will  promptly  deliver  to  the  Lender  in  pledge  all instruments,
documents  and chattel papers constituting Collateral, duly endorsed or assigned
by  the  Borrower.

     Section  6.10     Collateral  Account.
                       -------------------

          (a) If,  notwithstanding  the instructions to debtors to make payments
     to the Lockbox,  the Borrower  receives  any payments on  Receivables,  the
     Borrower shall deposit such payments into the Collateral Account.  Until so
     deposited,  the Borrower  shall hold all such  payments in trust for and as
     the property of the Lender and shall not  commingle  such payments with any
     of its other funds or property.

          (b)  Amounts  deposited  in the  Collateral  Account  shall  not  bear
     interest and shall not be subject to  withdrawal  by the  Borrower,  except
     after full payment and  discharge of all  Obligations.  All deposits in the
     Collateral  Account shall  constitute  proceeds of Collateral and shall not
     constitute payment of the Obligations.

                                     - 29 -
<PAGE>
          (c) All items deposited in the Collateral  Account shall be subject to
     final payment. If any such item is returned uncollected,  the Borrower will
     immediately  pay the  Lender,  or, for items  deposited  in the  Collateral
     Account,  the bank  maintaining  such account,  the amount of that item, or
     such  bank  at its  discretion  may  charge  any  uncollected  item  to the
     Borrower's  commercial  account or other  account.  The  Borrower  shall be
     liable as an endorser on all items  deposited  in the  Collateral  Account,
     whether or not in fact endorsed by the Borrower.

          Section 6.11 Performance by the Lender. Following the occurrence of an
                       -------------------------
Event  of Default, the Lender may, but need not, perform or observe any covenant
which  the  Borrower  has failed to perform on behalf and in the name, place and
stead  of  the  Borrower  (or, at the Lender's option, in the Lender's name) and
may,  but  need  not,  take  any  and  all  other  actions  which the Lender may
reasonably  deem  necessary  to cure or correct such failure (including, without
limitation,  the payment of taxes, the satisfaction of security interests, liens
or encumbrances, the performance of obligations owed to account debtors or other
obligors,  the  procurement  and  maintenance  of  insurance,  the  execution of
assignments,  security  agreements and financing statements, and the endorsement
of  instruments);  and  the Borrower shall thereupon pay to the Lender on demand
the  amount  of  all  monies  expended  and  all  costs  and expenses (including
reasonable  attorneys'  fees  and  legal  expenses)  incurred  by  the Lender in
connection  with  or  as  a  result  of  the  performance  or observance of such
agreements  or  the  taking of such action by the Lender, together with interest
thereon  from the date expended or incurred at the Floating Rate.  To facilitate
the  Lender's  performance  or  observance  of  such  covenants  of the Borrower
following the occurrence of an Event of Default, the Borrower hereby irrevocably
appoints  the  Lender, or the Lender's delegate, acting alone, as the Borrower's
attorney  in fact (which appointment is coupled with an interest) with the right
(but  not  the  duty)  from  time to time to create, prepare, complete, execute,
deliver,  endorse  or file in the name and on behalf of the Borrower any and all
instruments,  documents, assignments, security agreements, financing statements,
applications  for  insurance  and  other  agreements and writings required to be
obtained,  executed,  delivered  or  endorsed by the Borrower under this Section
6.11.

          Section  6.12 Minimum  Book  Net  Worth. The  Borrower  will maintain,
                        -------------------------
during each period described below, its Book Net Worth, determined as at the end
of  each  month,  at  an amount not less than the amount set forth opposite such
period:

                                     - 30 -
<PAGE>
                         Period         Minimum Book Net Worth
                  --------------------  ----------------------
                  July 31, 2000              $17,000,000
                  August 31, 2000            $17,000,000
                  September 30, 2000         $17,800,000
                  October 31, 2000           $18,000,000
                  November 30, 2000          $18,500,000
                  December  31,  2000
                  and thereafter             $19,100,000

     Section  6.13     Minimum  Adjusted  Net Income.  The Borrower will achieve
                       -----------------------------
during  each  period  described  below, Adjusted Net Income of not less than the
amount  set  forth  opposite  such  period:

                           Period               Minimum  Adjusted
                           ------               -----------------
                                                 Net Income
                                                 ----------

    Six  months  ending  September  30,  2000        ($5,500,000)
    Three  months  ending  December  31,  2000        $1,300,000
    Three  months  ending  March  31,  2001                    0

          Section 6.14 New Covenants.  On or before March 31, 2001 Lender shall
                       -------------
set  new covenant levels for Sections 6.12, 6.13 and 7.10 for periods after such
date.  The  new  covenant levels will be based on the Borrower's projections for
such  periods received by Lender pursuant to Section 6.1(c) and shall be no less
stringent  than  the  present  levels.

          Section 6.15 Premises. The Borrower agrees to provide the Lender with
                       --------
true  and correct copies of leases pursuant to which the Borrower is leasing the
Premises,  and  to  use  its  best efforts to obtain and provide to the Lender a
landlord's  disclaimer  and  consent  with  respect  to  each  such  lease.

          Section 6.16 Off-Site Inventory. In the event Inventory at any
                       -------------------
location other than those listed in Schedule 5.1 hereto, exceeds an amount equal
                                    ------------
to Two Hundred and Fifty Thousand Dollars ($250,000),  Borrower shall (i) notify
Lender of such location, and (ii) execute UCC financing statements sufficient to
protect the Borrower's and the Lender's interests in such Inventory.

                                   ARTICLE VII

                               Negative Covenants

So  long  as  the  Obligations shall remain unpaid, or the Credit Facility shall
remain outstanding, the Borrower agrees that, without the Lender's prior written
consent:

                                     - 31 -
<PAGE>
     Section  7.1     Liens.  The  Borrower  will not create, incur or suffer to
                      -----
exist  any  mortgage, deed of trust, pledge, lien, security interest, assignment
or  transfer  upon  or of any of its assets, now owned or hereafter acquired, to
secure  any  indebtedness;  excluding,  however,  from  the  operation  of  the
                            ---------   -------
foregoing,  the  following  (collectively,  "Permitted  Liens"):
                                             ----------------

          (a)  in the  case  of any of  the  Borrower's  property  which  is not
     Collateral  or  other  collateral  described  in  the  Security  Documents,
     covenants,  restrictions,  rights,  easements and minor  irregularities  in
     title which do not materially  interfere  with the  Borrower's  business or
     operations as presently conducted;

          (b) mortgages,  deeds of trust, pledges, liens, security interests and
     assignments  in  existence  on the date hereof and listed in  Schedule  7.1
     hereto;                                                       -------------

          (c) the Security Interest and liens and security  interests created by
     the Security Documents;

          (d) purchase money security  interests  relating to the acquisition of
     machinery  and  equipment of the Borrower  not  exceeding  the cost or fair
     market value thereof and so long as no Default  Period is then in existence
     and none would exist immediately after such acquisition.

          (e) liens for taxes,  assessments or governmental charges or levies on
     the Borrower's  property if the same shall not at the time be delinquent or
     thereafter  can be paid  without  penalty,  or are being  contested in good
     faith and by appropriate  proceedings  and for which  adequate  reserves in
     accordance with GAAP shall have been set aside on the Borrower's books;

          (f)  liens  imposed  by law,  such as  carriers',  warehousemen's  and
     mechanics'  liens and other similar lines arising in the ordinary course of
     business which secure payment of obligations not more than 60 days past due
     or which are being  contested in good faith by appropriate  proceedings and
     for which adequate reserves shall have been set aside on its books;

          (g)  liens  arising  out  of  pledges  or  deposits   under   worker's
     compensation  laws,  unemployment  insurance,  old age  pensions,  or other
     social security or retirement benefits, or similar legislation;

          (h) liens securing  capitalized  leases permitted  pursuant to Section
     7.2; and

          (i) the  replacement,  extension  or  renewal  of any  lien  permitted
     hereunder so long as the Debt secured by such lien is not increased by such
     replacement, extension or renewal.

     Section  7.2     Indebtedness.  The Borrower will not incur, create, assume
                      ------------
or  permit  to  exist  any  indebtedness  or liability on account of deposits or
advances  or  any indebtedness for borrowed money or letters of credit issued on
the  Borrower's  behalf,  or  any  other  indebtedness or liability evidenced by
notes,  bonds,  debentures  or  similar  obligations,  except:

                                     - 32 -
<PAGE>
          (a) indebtedness arising hereunder;

          (b)  indebtedness  of the Borrower in existence on the date hereof and
     listed in Schedule 7.2 hereto and all refundings and refinancings  thereof;
               ------------
     provided,  however,  that the dollar amount of such indebtedness may not be
     increased;

          (c)  indebtedness  relating  to liens  permitted  in  accordance  with
     Section 7.1;

          (d)  obligations  in respect  of  capitalized  leases in an  aggregate
     amount not to exceed $1,200,000 at any time outstanding, and

          (e) indebtedness in respect of performance bonds, bankers acceptances,
     letter of credit and surety or appeal bonds entered into by the Borrower in
     the ordinary course of business.

          Section 7.3 Guaranties. The Borrower will not assume, guarantee,
                      ----------
endorse  or  otherwise become directly or contingently liable in connection with
any  obligations  of  any  other  Person,  except:

          (a) the  endorsement  of  negotiable  instruments  by the Borrower for
     deposit or collection  or similar  transactions  in the ordinary  course of
     business; and

          (b)   guaranties,   endorsements   and  other  direct  or   contingent
     liabilities  in  connection  with  the  obligations  of other  Persons,  in
     existence   on  the  date  hereof  and  listed  in  Schedule   7.2  hereto.
                                                         --------------

          Section 7.4 Investments and Subsidiaries.
                      ------------------------------

     (a) The Borrower will not purchase or hold  beneficially any stock or other
     securities  or  evidences of  indebtedness  of, make or permit to exist any
     loans or  advances  to, or make any  investment  or  acquire  any  interest
     whatsoever  in,  any  other  Person,  including  specifically  but  without
     limitation any partnership or joint venture, except:

               (i)  investments  in direct  obligations  of the United States of
          America or any agency or  instrumentality  thereof  whose  obligations
          constitute  full faith and credit  obligations of the United States of
          America having a maturity of one year or less, commercial paper issued
          by  U.S.  corporations  rated  "A-1"  or  "A-2"  by  Standard  & Poors
                                         ----        ---
          Corporation  or  "P-1"  or  "P-2"  by  Moody's  Investors  Service  or
                            ---        ---
          certificates of deposit or bankers'  acceptances  having a maturity of
          one year or less  issued by  members  of the  Federal  Reserve  System
          having   deposits   in  excess   of  One   Hundred   Million   Dollars
          ($100,000,000)  (which certificates of deposit or bankers' acceptances
          are fully insured by the Federal Deposit Insurance Corporation);

               (ii) travel  advances  or loans to the  Borrower's  officers  and
          employees  not  exceeding  at any one time an aggregate of Twenty Five
          Thousand Dollars  ($25,000),  except for the loan in the amount of Two
          Hundred  Thousand  Dollars  ($200,000),  provided by Borrower to Bryan
          Kelln  as  evidenced  by  that  certain  Employment  Agreement,  dated
          December 23, 1999, between Bryan L. Kelln and Borrower;

                                     - 33 -
<PAGE>
               (iii) advances in the form of progress payments, prepaid rent not
          exceeding three (3) months or security deposits;

               (iv)  investments  existing on the date hereof and  described  in
          Schedule 7.4;

               (v) accounts receivable;

               (vi) investments  received in settlement of arms length disputes;
          and

               (vii) any  endorsement  of a check or other medium of payment for
          deposit or  collection,  or any similar  transaction  in the  ordinary
          course of business.

          (b) The Borrower will not create or permit to exist any Subsidiary.

               Section 7.5  Dividends.  The Borrower will not declare or pay any
                            ---------
dividends (other than dividends  payable solely in stock of the Borrower) on any
class of its stock or make any payment on account of the purchase, redemption or
other retirement of any shares of such stock or make any distribution in respect
thereof, either directly or indirectly.

               Section 7.6 Sale or Transfer  of Assets;  Suspension  of Business
                           -----------------------------------------------------
Operations.  The Borrower will not sell,  lease,  assign,  transfer or otherwise
----------
dispose of (i) the stock of any  Subsidiary,  (ii) all or a substantial  part of
its assets,  or (iii) any  Collateral  or any interest  therein  (whether in one
transaction or in a series of  transactions)  to any other Person other than the
sale of Inventory  in the ordinary  course of business and the sale of any other
property  which is  obsolete,  worn out or no longer  useful  in the  Borrower's
business, and will not liquidate, dissolve or suspend business operations.

               Section 7.7 Consolidation and Merger; Asset Acquisitions.
                           --------------------------------------------
The Borrower will not consolidate  with or merge into any Person,  or permit any
other Person to merge into it, or acquire (in a transaction analogous in purpose
or effect to a consolidation or merger) all or  substantially  all the assets of
any other Person.

               Section  7.8 Sale  and  Leaseback. The Borrower will not enter
                            --------------------
into any arrangement,  directly or indirectly, with any other Person whereby the
Borrower shall sell or transfer any real or personal property, whether now owned
or  hereafter  acquired,  and then or  thereafter  rent or lease as lessee  such
property or any part thereof or any other property which the Borrower intends to
use for substantially the same purpose or purposes as the property being sold or
transferred.

               Section 7.9 Restrictions on Nature of Business.
                           -----------------------------------
The Borrower will not engage in any line of business  materially  different from
that  presently  engaged  in by the  Borrower  and will not  purchase,  lease or
otherwise acquire assets not related to its business.

                                     - 34 -
<PAGE>
               Section 7.10 Capital Expenditures. The Borrower will not incur or
                            --------------------
contract to incur  Capital  Expenditures  of more than Three Million Six Hundred
Thousand Dollars ($3,600,000) in the aggregate during any fiscal year.

               Section 7.11     Accounting.  The Borrower will not adopt any
                                ----------
material  change in accounting  principles  other than as required by GAAP.  The
Borrower will not adopt, permit or consent to any change in its fiscal year.

               Section  7.12  Discounts,  etc.  The Borrower will not, after
                              ---------------
notice from the Lender, grant any discount,  credit or allowance to any customer
of the  Borrower  or accept any return of goods  sold,  or at any time  (whether
before or after notice from the Lender) modify,  amend,  subordinate,  cancel or
terminate the  obligation of any account debtor or other obligor of the Borrower
other than in accordance with its customary business practice.

               Section  7.13 Defined  Benefit  Pension Plans.
                             -------------------------------
The  Borrower  will not adopt,  create,  assume or become a party to any defined
benefit pension plan, unless disclosed to the Lender pursuant to Section 5.10.

               Section  7.14     Other  Defaults.  The  Borrower  will  not
                                 ---------------
permit any  breach,  default or event of default to occur  under any note,  loan
agreement,  indenture, lease, mortgage, contract for deed, security agreement or
other contractual obligation binding upon the Borrower.

               Section  7.15     Place of Business; Name.  Without providing 30
                                 -----------------------
days'  notice  to the  Lender,  (a) the  Borrower  will not  transfer  its chief
executive  office or principal place of business,  or move,  relocate,  close or
sell any  business  location;  (b) the  Borrower  will not permit  any  tangible
Collateral  or any records  pertaining  to the  Collateral  to be located in any
state or area in which,  in the event of such  location,  a financing  statement
covering  such  Collateral  would be  required  to be, but has not in fact been,
filed in order to perfect the Security  Interest;  and (c) the Borrower will not
change its name.

               Section  7.16     Organizational  Documents.  The  Borrower  will
                                 -------------------------
not amend its certificate of incorporation,  articles of incorporation or bylaws
in a manner which would adversely affect the Lender.

               Section 7.17  Salaries. The Borrower will not pay excessive or
                             --------
unreasonable   salaries,   bonuses,   commissions,   consultant  fees  or  other
compensation or excessively increase the salary, bonus, commissions,  consultant
fees or other compensation of any director, officer or consultant, or any member
of their families, either individually or for all such persons in the aggregate.

               Section  7.18 Change  in Ownership.  The Borrower will not issue
                             --------------------
or sell any stock of the Borrower so as to change the  percentage  of voting and
non-voting stock owned by each of the Borrower's shareholders.

               Section 7.19  Transactions  with  Affiliates.
                             ------------------------------
Borrower shall not enter into any transaction for the purchase, sale or exchange
of property or the  rendering of any service to or by any  Affiliate,  except in
the ordinary course of and pursuant to the reasonable requirements of Borrower's
business and upon fair and  reasonable  terms no less favorable to Borrower than
Borrower  would  obtain  in  a  comparable  arms  length   transaction  with  an
unaffiliated Person.

                                     - 35 -
<PAGE>
                                  ARTICLE VIII

                     Events of Default, Rights and Remedies
                     --------------------------------------

     Section  8.1     Events  of  Default.  "Event  of  Default",  wherever used
                      -------------------    ------------------
herein,  means  any  one  of  the following events, which Event of Default shall
exist  or  continue  or  be  continuing until such Event of Default is waived in
accordance  with  Section  9.2  hereof:

          (a) Default in the payment of the Obligations when they become due and
     payable;

          (b)  Failure  to pay when due any  amount  specified  in  Section  2.3
     relating to the Borrower's  Obligation of Reimbursement,  or failure to pay
     immediately when due or upon termination of the Credit Facility any amounts
     required to be paid for deposit in the Special  Account  under  Section 2.4
     or;

          (c) Default in the payment of any fees, commissions, costs or expenses
     required to be paid by the Borrower under this Agreement;

          (d)  Default  in  the  performance,  or  breach,  of any  covenant  or
     agreement of the Borrower  contained in this  Agreement and such default or
     breach shall  continue for ten (10) Banking Days;  provided,  that such ten
     (10) Banking Day cure period shall not apply in the case of (i) any default
     or event  addressed in any other  provision  or paragraph of this  Section,
     (ii) the failure to comply with the covenants  set forth in Sections  6.12,
     6.13 or 7.10, (iii) any default in the performance,  or breach, of any such
     covenant or agreement  which is not capable of being cured at all or within
     such ten (10) Banking Day period or which has  previously  been the subject
     of a previous  default or breach  within the prior twelve (12) month period
     or (iv) an intentional breach by Borrower of such covenant or agreement;

          (e) The Borrower shall be or become insolvent, or admit in writing its
     inability to pay its debts as they mature,  or make an  assignment  for the
     benefit of  creditors;  or the  Borrower  shall apply for or consent to the
     appointment of any receiver,  trustee, or similar officer for it or for all
     or any  substantial  part of its  property;  or such  receiver,  trustee or
     similar  officer shall be appointed  without the  application or consent of
     the Borrower and not dismissed in 60 days; or the Borrower shall  institute
     (by petition,  application,  answer,  consent or otherwise) any bankruptcy,
     insolvency, reorganization, arrangement, readjustment of debt, dissolution,
     liquidation  or  similar  proceeding  relating  to it under the laws of any
     jurisdiction;  or any such  proceeding  shall be  instituted  (by petition,
     application  or  otherwise)  against the Borrower  and not  dismissed in 60
     days; or any judgment,  writ, warrant of attachment or execution or similar
     process  shall be  issued  or  levied  against  a  substantial  part of the
     property of the Borrower and not dismissed in 60 days;

                                     - 36 -
<PAGE>
          (f) A petition  shall be filed by or against  the  Borrower  under the
     United  States  Bankruptcy  Code naming the  Borrower as debtor and, in the
     case of petitions  filed against  Borrower,  not dismissed  within 60 days;
     provided,  Borrower  shall not receive an Advance prior to the dismissal of
     any such petition filed against the Borrower;

          (g)  Any  representation  or  warranty  made by the  Borrower  in this
     Agreement,  or by the Borrower (or any of its  officers) in any  agreement,
     certificate,   instrument  or  financial   statement  or  other   statement
     contemplated by or made or delivered pursuant to or in connection with this
     Agreement  shall prove to have been incorrect in any material  respect when
     deemed to be effective;

          (h) The rendering against the Borrower of a final judgment,  decree or
     order for the  payment of money in excess of One Hundred  Thousand  Dollars
     ($100,000)  and  the   continuance  of  such  judgment,   decree  or  order
     unsatisfied  and in effect for any period of thirty (30)  consecutive  days
     without a stay of execution;

          (i) A default  under any bond,  debenture,  note or other  evidence of
     indebtedness  (excluding trade payables) of the Borrower owed to any Person
     other than the Lender,  or under any  indenture or other  instrument  under
     which any such evidence of  indebtedness  has been issued or by which it is
     governed, or under any lease of any of the Premises,  and the expiration of
     the  applicable  period of grace,  if any,  specified  in such  evidence of
     indebtedness, indenture, other instrument or lease;

          (j) Any Reportable  Event,  which the Lender  determines in good faith
     might  constitute  grounds  for  the  termination  of any  Plan  or for the
     appointment by the appropriate United States District Court of a trustee to
     administer any Plan, shall have occurred and be continuing thirty (30) days
     after  written  notice to such effect shall have been given to the Borrower
     by the Lender;  or a trustee  shall have been  appointed by an  appropriate
     United States District Court to administer any Plan; or the Pension Benefit
     Guaranty  Corporation  shall have  instituted  proceedings to terminate any
     Plan or to appoint a trustee to administer  any Plan; or the Borrower shall
     have filed for a distress  termination of any Plan under Title IV of ERISA;
     or the  Borrower  shall  have  failed  to make any  quarterly  contribution
     required  with  respect to any Plan under  Section  412(m) of the  Internal
     Revenue Code of 1986, as amended, which the Lender determines in good faith
     may by itself, or in combination with any such failures that the Lender may
     determine are likely to occur in the future,  result in the imposition of a
     lien on the Borrower's assets in favor of the Plan;

          (k) An event of default  shall  occur under any  Security  Document or
     under any other security agreement,  mortgage, deed of trust, assignment or
     other  instrument  or agreement  securing any  obligations  of the Borrower
     hereunder or under any note and such event of default shall not be cured or
     waived within ten (10) Banking Days;  provided,  that such ten (10) Banking
     Day cure  period  shall not apply in the case of (i) any  default  or event
     addressed in any other  provision or  paragraph of this  Section,  (ii) any
     event of default  which is not capable of being cured at all or within such
     ten (10) Banking Day period or which has  previously  been the subject of a
     previous  default or breach  within the prior  twelve (12) month  period or
     (iv) an intentional default by Borrower;

                                     - 37 -
<PAGE>
          (l) The Borrower shall liquidate,  dissolve,  terminate or suspend its
     business  operations  or  otherwise  fail to operate  its  business  in the
     ordinary course,  or sell all or substantially  all of its assets,  without
     the Lender's prior written consent;

     Section  8.2     Rights and Remedies.  Following the occurrence of an Event
                      -------------------
of  Default,  the  Lender  may  exercise  any or all of the following rights and
remedies:

          (a) the Lender may, by notice to the Borrower,  declare the Commitment
     to be terminated, whereupon the same shall forthwith terminate;

          (b) the Lender may, by notice to the Borrower, declare the Obligations
     to be forthwith due and payable, whereupon all Obligations shall become and
     be forthwith  due and  payable,  without  presentment,  notice of dishonor,
     protest or further  notice of any kind,  all of which the  Borrower  hereby
     expressly waives;

          (c) the Lender may, without notice to the Borrower and without further
     action,  apply any and all money owing by the Lender to the Borrower to the
     payment of the Obligations;

          (d) the Lender may make demand upon the Borrower and,  forthwith  upon
     such demand,  the Borrower will pay to the Lender in immediately  available
     funds for deposit in the Special Account pursuant to Section 2.13 an amount
     equal to the  aggregate  maximum  amount  available  to be drawn  under all
     Letters of Credit then outstanding, assuming compliance with all conditions
     for drawing thereunder;

          (e) the  Lender  may  exercise  and  enforce  any and all  rights  and
     remedies  available  upon  default  to  a  secured  party  under  the  UCC,
     including,  without limitation, the right to take possession of Collateral,
     or any evidence thereof, proceeding without judicial process or by judicial
     process  (without a prior  hearing or notice  thereof,  which the  Borrower
     hereby expressly  waives) and the right to sell, lease or otherwise dispose
     of any or all of the Collateral, and, in connection therewith, the Borrower
     will on demand  assemble the Collateral and make it available to the Lender
     at a place to be designated by the Lender which is reasonably convenient to
     both parties;

          (f) the Lender may exercise and enforce its rights and remedies  under
     the Loan Documents; and

          (g) the Lender may exercise any other rights and remedies available to
     it by law or agreement.

Notwithstanding  the  foregoing,  upon  the  occurrence  of  an Event of Default
described  in  subsections  (d)  or (e) of Section 8.1, the Obligations shall be
immediately  due  and payable automatically without presentment, demand, protest
or  notice  of  any  kind.

                                     - 38 -
<PAGE>
          Section 8.3 Certain Notices. If notice to the Borrower of any intended
                      ---------------
disposition  of  Collateral or any other intended action is required by law in a
particular  instance,  such  notice  shall  be deemed commercially reasonable if
given  (in  the manner specified in Section 9.3) at least ten (10) calendar days
before  the  date  of  intended  disposition  or  other  action.

                                   ARTICLE IX

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

          Section 9.1 No Waiver; Cumulative Remedies. No failure or delay by the
                      ------------------------------
Lender  in  exercising any right, power or remedy under the Loan Documents shall
operate  as  a  waiver  thereof; nor shall any single or partial exercise of any
such  right,  power  or remedy preclude any other or further exercise thereof or
the  exercise of any other right, power or remedy under the Loan Documents.  The
remedies  provided in the Loan Documents are cumulative and not exclusive of any
remedies  provided  by  law.

          Section 9.2 Amendments, Etc.  No amendment, modification, termination
                      ---------------
or  waiver  of any provision of any Loan Document or consent to any departure by
the  Borrower therefrom or any release of a Security Interest shall be effective
unless  the  same  shall  be  in writing and signed by the Lender, and then such
waiver  or  consent shall be effective only in the specific instance and for the
specific purpose for which given.  No notice to or demand on the Borrower in any
case  shall  entitle  the  Borrower  to any other or further notice or demand in
similar  or  other  circumstances.  No  amendment  or  modification  of any Loan
Document  shall  be  effective  unless the same shall be signed by the Borrower.
Section  9.3     Addresses  for  Notices,  Etc.  Except  as  otherwise expressly
                 -----------------------------
provided  herein,  all  notices,  requests,  demands  and  other  communications
provided  for  under  the  Loan  Documents  shall be in writing and shall be (a)
personally  delivered,  (b)  sent by first class United States mail, (c) sent by
overnight  courier  of  national  reputation, or (d) transmitted by telecopy, in
each  case addressed or telecopied to the party to whom notice is being given at
its  address  or  telecopier  number  as  set  forth  below:

                If  to  the  Borrower:

                Rockshox,  Inc.
                1610  Garden  of  the  Gods  Road
                Colorado  Springs,  Colorado  80907
                Telecopier:     _________________
                Attention:     Chris  Birkett

                If  to  the  Lender:

                Wells  Fargo  Business  Credit,  Inc.
                245  South  Los  Robles  Avenue,  Suite  600
                Pasadena,  California  91101
                Telecopier:  (626)  844-9063
                Attention:  Account  Executive

or,  as  to  each  party,  at  such  other  address  or telecopier number as may
hereafter  be  designated  by  such party in a written notice to the other party
complying  as  to  delivery  with  the terms of this Section.  All such notices,
requests, demands and other communications shall be deemed to have been given on
(a) the date received if personally delivered, (b) when deposited in the mail if
delivered  by  mail,  (c) the date sent if sent by overnight courier, or (d) the
date  of  transmission if delivered by telecopy, except that notices or requests
to  the  Lender  pursuant  to  any  of the provisions of Article II shall not be
effective  until  received  by  the  Lender.

                                     - 39 -
<PAGE>
          Section  9.4 Further Documents. The  Borrower  will from time to time
                       -----------------
execute  and deliver or endorse any and all instruments, documents, conveyances,
assignments,  security agreements, financing statements and other agreements and
writings  that  the  Lender  may reasonably request in order to secure, protect,
perfect  or  enforce the Security Interest or the Lender's rights under the Loan
Documents  (but  any  failure  to  request or assure that the Borrower executes,
delivers  or  endorses  any  such  item shall not affect or impair the validity,
sufficiency  or  enforceability of the Loan Documents and the Security Interest,
regardless  of  whether  any  such  item  was  or was not executed, delivered or
endorsed  in  a  similar  context  or  on  a  prior  occasion).

          Section  9.5 Collateral. This Agreement does not contemplate a sale of
                       ----------
accounts,  contract  rights  or  chattel  paper,  and,  as  provided by law, the
Borrower  is entitled to any surplus and shall remain liable for any deficiency.
The  Lender's  duty  of  care  with  respect to Collateral in its possession (as
imposed  by  law)  shall  be deemed fulfilled if it exercises reasonable care in
physically  keeping such Collateral, or in the case of Collateral in the custody
or  possession  of  a bailee or other third person, exercises reasonable care in
the  selection  of  the  bailee  or  other third person, and the Lender need not
otherwise  preserve,  protect,  insure  or  care for any Collateral.  The Lender
shall  not  be  obligated  to  preserve any rights the Borrower may have against
prior  parties,  to realize on the Collateral at all or in any particular manner
or order or to apply any cash proceeds of the Collateral in any particular order
of  application.

          Section 9.6 Costs and Expenses. The Borrower agrees to pay on demand
                      ------------------
all reasonable costs and expenses,  including  (without  limitation)  attorneys'
fees, incurred by the Lender in connection with the Obligations, this Agreement,
the Loan  Documents,  any Letters of Credit and any other  document or agreement
related hereto or thereto, and the transactions  contemplated hereby,  including
without limitation all such costs, expenses and fees incurred in connection with
the negotiation, preparation, execution, amendment, administration, performance,
collection  and  enforcement  of the  Obligations  and all  such  documents  and
agreements and the creation, perfection, protection,  satisfaction,  foreclosure
or enforcement of the Security Interest.

          Section 9.7 Indemnity. In addition to the payment of expenses pursuant
                      ---------
to  Section  9.6, the Borrower agrees to indemnify, defend and hold harmless the
Lender,  and any of its parent corporations, subsidiary corporations, affiliated
corporations,  successor  corporations,  and  all  present  and future officers,
directors,  employees, attorneys and agents of the foregoing (the "Indemnitees")
                                                                   -----------
from  and  against  any  of  the following except to the extent arising from the
gross  negligence or willful misconduct of Lender or the breach by Lender of any
Loan  Document  (collectively,  "Indemnified  Liabilities"):
                                 ------------------------

               (i) any and all transfer taxes, documentary taxes, assessments or
          charges made by any governmental  authority by reason of the execution
          and delivery of the Loan Documents or the making of the Advances;

               (ii) any claims,  loss or damage to which any  Indemnitee  may be
          subjected if any  representation or warranty contained in Section 5.12
          proves to be incorrect in any respect or as a result of any  violation
          of the covenant contained in Section 6.4(b); and

               (iii) any and all other liabilities,  losses, damages, penalties,
          judgments,  suits,  claims,  costs and  expenses of any kind or nature
          whatsoever  (including,  without  limitation,  the reasonable fees and
          disbursements  of counsel) in  connection  with the  foregoing and any
          other investigative,  administrative or judicial proceedings,  whether
          or not such Indemnitee shall be designated a party thereto,  which may
          be imposed on, incurred by or asserted against any such Indemnitee, in
          any  manner  related to or arising  out of or in  connection  with the
          making of the Advances  and the Loan  Documents or the use or intended
          use of the proceeds of the Advances.

If  any investigative, judicial or administrative proceeding arising from any of
the foregoing is brought against any Indemnitee, upon such Indemnitee's request,
the  Borrower,  or  counsel  designated  by the Borrower and satisfactory to the
Indemnitee, will resist and defend such action, suit or proceeding to the extent
and  in  the manner directed by the Indemnitee, at the Borrower's sole costs and
expense.  Each  Indemnitee will use its best efforts to cooperate in the defense
of  any  such  action,  suit  or  proceeding.  If  the  foregoing undertaking to
indemnify,  defend  and hold harmless may be held to be unenforceable because it
violates  any  law  or  public  policy, the Borrower shall nevertheless make the
maximum  contribution to the payment and satisfaction of each of the Indemnified
Liabilities  which  is  permissible  under  applicable  law.  The  Borrower's
obligation  under  this  Section  9.7  shall  survive  the  termination  of this
Agreement  and  the  discharge  of  the  Borrower's other obligations hereunder.

          Section 9.8 Participants. The Lender and its participants, if any, are
                      ------------
not  partners or joint venturers, and the Lender shall not have any liability or
responsibility  for  any obligation, act or omission of any of its participants.
All  rights and powers specifically conferred upon the Lender may be transferred
or  delegated  to  any  of  the  Lender's  participants,  successors or assigns.

          Section 9.9 Execution in Counterparts. This Agreement and other Loan
                      -------------------------
Documents  may  be executed in any number of counterparts, each of which when so
executed  and  delivered  shall  be  deemed  to  be an original and all of which
counterparts,  taken together, shall constitute but one and the same instrument.

          Section  9.10  Binding   Effect;   Assignment;   Complete   Agreement;
                         -------------------------------------------------------
Exchanging  Information.  The Loan Documents  shall be binding upon and inure to
------------------------
the benefit of the Borrower and the Lender and their  respective  successors and
assigns,  except that the Borrower shall not have the right to assign its rights
thereunder or any interest  therein without the Lender's prior written  consent.
This  Agreement,  together with the Loan  Documents,  comprises the complete and
integrated  agreement of the parties on the subject matter hereof and supersedes
all prior  agreements,  written or oral, on the subject matter  hereof.  Without
limiting the Lender's right to share information  regarding the Borrower and its
Affiliates  with the  Lender's  participants,  accountants,  lawyers  and  other
advisors  involved in the  transactions  subject to this Agreement,  the Lender,
Wells Fargo Corporation, and all direct and indirect subsidiaries of Wells Fargo
Corporation,  may  exchange  any and all  information  they  may  have in  their
possession  regarding  the  Borrower  as  may  be  reasonably  necessary  in the
administration  of  this  Agreement,  and  the  Borrower  waives  any  right  of
confidentiality it may have with respect to such exchange of such information.

                                     - 40 -
<PAGE>
          Section 9.11  Severability  of Provisions.  Any provision of this
                        ----------------------------
Agreementwhich is prohibited or unenforceable shall be ineffective to the extent
of such  prohibition  or  unenforceability  without  invalidating  the remaining
provisions hereof.

          Section 9.12  Headings. Article and Section headings in this Agreement
                        --------
are included herein for convenience of reference only and shall not constitute a
part of this Agreement for any other purpose.

          Section 9.13 Governing Law; Jurisdiction, Venue; Waiver of Jury Trial.
                       --------------------------------------------------------
This Agreement and the other Loan  Documents  shall be governed by and construed
in accordance with the substantive  laws (other than conflict laws) of the State
of  California.  Each of the parties  hereto hereby (i) consents to the personal
jurisdiction  of the state and federal courts located in the State of California
in connection with any  controversy  related to this Agreement or the other Loan
Documents;  (ii)  waives  any  argument  that  venue  in any  such  forum is not
convenient,  (iii)  agrees that any  litigation  initiated  by the Lender or the
Borrower in connection  with this Agreement or the other Loan Documents shall be
venued  in either  the State  Courts  of the  County  of Los  Angeles,  State of
California,  or the United  States  District  Court for the Central  District of
California;  and (iv) agrees that a final  judgment in any such suit,  action or
proceeding  shall be conclusive  and may be enforced in other  jurisdictions  by
suit on the judgment or in any other manner  provided by law. THE PARTIES  WAIVE
ANY RIGHT TO TRIAL BY JURY IN ANY ACTION OR PROCEEDING BASED ON OR PERTAINING TO
THIS AGREEMENT.

          Section 9.14 Release of Collateral. Upon a sale or other disposition
                       ---------------------
of assets of the  Borrower  constituting  Collateral  which was  consented to or
otherwise  approved by Lender or is permitted under this Agreement,  the Lender,
at the request of the  Borrower,  will  execute and deliver to the  Borrower the
proper  instruments  (including UCC termination  statements)  acknowledging  the
release of the Lender's Security Interest in such Collateral.

          Section 9.15 Termination, Release.  This Agreement and the Lender's
                       --------------------
Security  Interest shall terminate upon satisfaction in full of the Obligations.
Upon such termination,  the Lender, at the request of the Borrower, will execute
and deliver to the Borrower the proper  instruments  (including UCC  termination
statements)  acknowledging  the  termination  of this  Agreement  and will  duly
assign, transfer and deliver to the Borrower such of the Collateral as may be in
the possession of the Lender and has not  theretofore  been disposed of, applied
or released.

                                     - 41 -
<PAGE>
          Section  9.16 Confidentiality.  The  Lender  agrees to keep
                        ---------------
confidential  all  information  provided by the  Borrower  under this  Agreement
except  as  required  by  applicable  law or if such  information  is  otherwise
publicly available (other than as a result of actions by the Lender).

                                     - 42 -
<PAGE>
          IN  WITNESS  WHEREOF, the parties hereto have caused this Agreement to
be  executed  by  their  respective officers thereunto duly authorized as of the
date  first  above  written.

WELLS  FARGO  BUSINESS  CREDIT,  INC.,           ROCKSHOX,  INC.,
a  Minnesota  corporation                        a  Delaware  corporation
By                                               By
  -------------------------------                  -----------------------------
Name:                                            Name:
  -------------------------------                  -----------------------------
      Its  Vice  President                       Its

                                     - 43 -
<PAGE>
                                TABLE OF CONTENTS

                                                                            Page
                                                                            ----
                         TABLE OF EXHIBITS AND SCHEDULES

Exhibit  A        Form  of  Revolving  Note
Exhibit  B        Compliance  Certificate
Exhibit  C        Premises
---------------------------------------------------------------------
Schedule  5.1     Trade  Names,  Chief  Executive  Office,  Principal
                  Place  of Business,  and  Locations  of  Collateral
Schedule  5.4     Subsidiaries
Schedule  7.1     Permitted  Liens
Schedule  7.2     Permitted  Indebtedness  and  Guaranties
Schedule  7.4     Investments
---------------------------------------------------------------------

<PAGE>
                                      Exhibit A to Credit and Security Agreement

                            REVOLVING NOTE

$5,000,000                                                  San Jose, California
                                                               December 10, 1999

For value received, the undersigned, ROCKSHOX, INC., a Delaware corporation (the
"Borrower"),  hereby  promises  to  pay on the Termination Date under the Credit
 --------
Agreement  (defined below), to the order of WELLS FARGO BUSINESS CREDIT, INC., a
Minnesota  corporation  (the  "Lender"),  at  its  main  office  in  Pasadena,
                               ------
California,  or  at any other place designated at any time by the holder hereof,
in  lawful  money  of  the United States of America and in immediately available
funds,  the  principal sum of Five Million Dollars ($5,000,000) or, if less, the
aggregate  unpaid  principal amount of all Revolving Advances made by the Lender
to  the  Borrower  under  the  Credit  Agreement  (defined  below) together with
interest  on  the principal amount hereunder remaining unpaid from time to time,
computed  on  the basis of the actual number of days elapsed and a 360-day year,
from the date hereof until this Note is fully paid at the rate from time to time
in  effect under the Credit and Security Agreement of even date herewith (as the
same may hereafter be amended, restated, supplemented or otherwise modified from
time  to  time,  the  "Credit  Agreement")  by  and  between  the Lender and the
                       -----------------
Borrower.  The  principal  hereof and interest accruing thereon shall be due and
payable  as  provided in the Credit Agreement.  This Note may be prepaid only in
accordance  with  the  Credit  Agreement.
This  Note  is  issued  pursuant, and is subject, to the Credit Agreement, which
provides,  among  other  things,  for  acceleration  hereof.  This  Note  is the
Revolving Note referred to in the Credit Agreement.  This Note is secured, among
other  things,  pursuant  to  the Credit Agreement and the Security Documents as
therein  defined,  and  may  now  or  hereafter  be secured by one or more other
security agreements, mortgages, deeds of trust, assignments or other instruments
or  agreements.
The  Borrower hereby agrees to pay all costs of collection, including reasonable
attorneys'  fees and legal expenses in the event this Note is not paid when due,
whether  or  not  legal  proceedings  are  commenced.
Presentment  or  other  demand  for  payment, notice of dishonor and protest are
expressly  waived.

                                            ROCKSHOX,  INC.,
                                            a  Delaware  corporation

                                            By
                                            -----------------------------------
                                            Its  President

                                      A - 1
<PAGE>
                                      Exhibit B to Credit and Security Agreement

                             COMPLIANCE CERTIFICATE

To:     Wells  Fargo  Business  Credit,  Inc.

Date:
     ---------------------

Subject:     Financial  Statements
             ---------------------

In  accordance with our Amended and Restated Credit and Security Agreement dated
as  of  June  __,  2000  (the  "Credit  Agreement"),  attached are the financial
                                -----------------
statements  of  ROCKSHOX,  INC. (the "Borrower") as of and for ________________,
                                      --------
_____  (the  "Reporting  Date")  and  the  year-to-date  period  then ended (the
              ---------------
"Current  Financials").  All  terms  used  in this certificate have the meanings
       -------------
given  in  the  Credit  Agreement.
I  certify  that  the  Current  Financials have been prepared in accordance with
GAAP,  subject,  in  the  case  of quarterly or interim financial statements, to
year-end  audit adjustments and the absence of footnotes, and fairly present the
Borrower's  financial condition and the results of its operations as of the date
thereof.
Events  of  Default.  (Check  one):

     [ ] The undersigned  does not have knowledge of the occurrence of a Default
     or Event of Default under the Credit Agreement.

     [ ] The  undersigned  has knowledge of the occurrence of a Default or Event
     of Default under the Credit Agreement and attached hereto is a statement of
     the facts with respect to thereto.

I  hereby  certify  to  the  Lender  as  follows:

     [ ] The  Reporting  Date  does not  mark  the end of one of the  Borrower's
     fiscal quarters, hence I am completing only paragraph __ below.

     [ ] The  Reporting  Date  marks  the  end of one of the  Borrower's  fiscal
     quarters, hence I am completing all paragraphs below except paragraph __.

     [ ] The Reporting Date marks the end of the Borrower's fiscal year, hence I
     am completing all paragraphs below.

Financial  Covenants.  I  further  hereby  certify  as  follows:
--------------------

                                      B - 1
<PAGE>
          1.     Minimum Book Net Worth.  Pursuant to Section 6.12 of the Credit
                 ----------------------
Agreement,  as  of  the  Reporting  Date  the  Borrower's  Book  Net  Worth  was
$____________  which [ ]  satisfies [ ]  does  not satisfy the requirements of
 Section 6.12.

          2.     Minimum  Adjusted  Net Income.  Pursuant to Section 6.13 of the
                 -----------------------------
Credit  Agreement,  the  Borrower's  Adjusted Net Income for the ________ period
ending  on  the  Reporting  Date, was $___________, which [ ]  satisfies [ ]
does not satisfy  the  requirements  of  Section  6.13.

          3.     Capital  Expenditures.  Pursuant  to Section 7.10 of the Credit
                 ---------------------
Agreement,  for  the  year-to-date  period  ending  on  the  Reporting Date, the
Borrower  has  expended  or  contracted  to expend during the _____________ year
ended  ______________, ___, for Capital Expenditures, $__________________ in the
aggregate,  which [ ]  satisfies [ ]  does  not  satisfy  the  requirements of
Section 7.10.

          4.     Salaries.  As of the Reporting Date, the Borrower [ ]  is [ ]
                 --------
is not in  compliance  with  Section  7.16 of the Credit Agreement concerning
salaries.

                                      B - 2
<PAGE>
Attached hereto are all relevant facts in reasonable detail to evidence, and the
computations  of  the financial covenants referred to above.  These computations
were  made  in  accordance  with  GAAP.

                                      ROCKSHOX,  INC.,
                                      a  Delaware  corporation

                                      By
                                      ------------------------------------
                                      [Name]
                                      Its  Chief  Financial  Officer

                                      B - 3
<PAGE>
                                      Exhibit C to Credit and Security Agreement

                                    PREMISES

The  Premises  referred  to  in  the  Credit  and Security Agreement are legally
described  as  follows:

                                 (See Attached)

                                      C - 1
<PAGE>
                  Schedule 5.1 to Credit and Security Agreement

             TRADE NAMES, CHIEF EXECUTIVE OFFICE, PRINCIPAL PLACE OF
                      BUSINESS, AND LOCATIONS OF COLLATERAL

                                  (See Attached)

                                  Schedule 5.1
<PAGE>
                  Schedule 5.4 to Credit and Security Agreement

                                  SUBSIDIARIES

                         Rockshox Taiwan (branch office)

                                  Schedule 5.1
<PAGE>
                  Schedule 7.1 to Credit and Security Agreement

                                 PERMITTED LIENS

                                 [See attached]

                                  Schedule 7.1
<PAGE>
                  Schedule 7.2 to Credit and Security Agreement

                      PERMITTED INDEBTEDNESS AND GUARANTIES

                                      NONE.

<PAGE>
<TABLE>
<CAPTION>
<S>                                                                                 <C>
ARTICLE I     DEFINITIONS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   1
  Section 1.1  Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   1
  Section 1.2  Cross References  . . . . . . . . . . . . . . . . . . . . . . . . . .  10

ARTICLE II     AMOUNT AND TERMS OF THE CREDIT FACILITY . . . . . . . . . . . . . . .  10

  Section 2.1  Revolving Advances  . . . . . . . . . . . . . . . . . . . . . . . . .  10
  Section 2.2  Letters of Credit . . . . . . . . . . . . . . . . . . . . . . . . . .  11
  Section 2.3  Payment of Amounts Drawn Under Letters of Credit; Obligation of
               Reimbursement . . . . . . . . . . . . . . . . . . . . . . . . . . . .  12
  Section 2.4  Special Account . . . . . . . . . . . . . . . . . . . . . . . . . . .  13
  Section 2.5  Obligations Absolute  . . . . . . . . . . . . . . . . . . . . . . . .  13
  Section 2.6  Interest; Minimum Interest Charge; Default Interest; Participations;
               Usury . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  14
  Section 2.7  Fees  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  15
  Section 2.8  Computation of Interest and Fees; When Interest Due and Payable . . .  15
  Section 2.9  Capital Adequacy  . . . . . . . . . . . . . . . . . . . . . . . . . .  16
  Section 2.10 Maturity Date   . . . . . . . . . . . . . . . . . . . . . . . . . . .  17
  Section 2.11 Voluntary Prepayment; Reduction of the Maximum Line;
               Termination of the Credit Facility by the Borrower  . . . . . . . . .  17
  Section 2.12 Termination and Line Reduction Fees; Waiver of Termination and
               Line Reduction Fees . . . . . . . . . . . . . . . . . . . . . . . . .  17
  Section 2.13 Mandatory Prepayment  . . . . . . . . . . . . . . . . . . . . . . . .  17
  Section 2.14 Payment   . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  18
  Section 2.15 Payment on Non-Banking Days   . . . . . . . . . . . . . . . . . . . .  18
  Section 2.16 Use of Proceeds   . . . . . . . . . . . . . . . . . . . . . . . . . .  18
  Section 2.17 Liability Records   . . . . . . . . . . . . . . . . . . . . . . . . .  18
  Section 2.18 Deactivation of Credit Facility   . . . . . . . . . . . . . . . . . .  18

ARTICLE III    SECURITY INTEREST; OCCUPANCY; SETOFF  . . . . . . . . . . . . . . . .  19

  Section 3.1  Grant of Security Interest  . . . . . . . . . . . . . . . . . . . . .  19
  Section 3.2  Notification of Account Debtors and Other Obligors  . . . . . . . . .  19
  Section 3.3  Assignment of Insurance . . . . . . . . . . . . . . . . . . . . . . .  19
  Section 3.4  Occupancy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  20
  Section 3.5  License . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  20
  Section 3.6  Financing Statement . . . . . . . . . . . . . . . . . . . . . . . . .  20
  Section 3.7  Setoff  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  21

<PAGE>
ARTICLE IV     CONDITIONS OF LENDING . . . . . . . . . . . . . . . . . . . . . . . .  21

  Section 4.1  Conditions Precedent to the Initial Revolving Advance and the
               Initial Letter of Credit  . . . . . . . . . . . . . . . . . . . . . .  21
  Section 4.2  Conditions Precedent to All Advances and Letters of Credit  . . . . .  22

ARTICLE V     REPRESENTATIONS AND WARRANTIES . . . . . . . . . . . . . . . . . . . .  23

  Section 5.1  Corporate Existence and Power; Name; Chief Executive Office;
               Inventory and Equipment Locations; Tax Identification Number  . . . .  23
  Section 5.2  Authorization of Borrowing; No Conflict as to Law or Agreements . . .  23
  Section 5.3  Legal Agreements  . . . . . . . . . . . . . . . . . . . . . . . . . .  23
  Section 5.4  Subsidiaries  . . . . . . . . . . . . . . . . . . . . . . . . . . . .  23
  Section 5.5  Financial Condition; No Adverse Change  . . . . . . . . . . . . . . .  24
  Section 5.6  Litigation  . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  24
  Section 5.7  Regulation U  . . . . . . . . . . . . . . . . . . . . . . . . . . . .  24
  Section 5.8  Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  24
  Section 5.9  Titles and Liens  . . . . . . . . . . . . . . . . . . . . . . . . . .  24
  Section 5.10 Plans   . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  24
  Section 5.11 Default   . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  25
  Section 5.12 Environmental Matters   . . . . . . . . . . . . . . . . . . . . . . .  25
  Section 5.13 Submissions to Lender   . . . . . . . . . . . . . . . . . . . . . . .  26
  Section 5.14 Financing Statements  . . . . . . . . . . . . . . . . . . . . . . . .  26
  Section 5.15 Rights to Payment   . . . . . . . . . . . . . . . . . . . . . . . . .  26

<PAGE>
ARTICLE VI     BORROWER'S AFFIRMATIVE COVENANTS. . . . . . . . . . . . . . . . . . .  27

  Section 6.1  Reporting Requirements  . . . . . . . . . . . . . . . . . . . . . . .  27
  Section 6.2  Books and Records; Inspection and Examination . . . . . . . . . . . .  29
  Section 6.3  Account Verification  . . . . . . . . . . . . . . . . . . . . . . . .  29
  Section 6.4  Compliance with Laws  . . . . . . . . . . . . . . . . . . . . . . . .  29
  Section 6.5  Payment of Taxes and Other Claims . . . . . . . . . . . . . . . . . .  30
  Section 6.6  Maintenance of Properties . . . . . . . . . . . . . . . . . . . . . .  30
  Section 6.7  Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  30
  Section 6.8  Preservation of Existence . . . . . . . . . . . . . . . . . . . . . .  31
  Section 6.9  Delivery of Instruments, etc. . . . . . . . . . . . . . . . . . . . .  31
  Section 6.10 Collateral Account  . . . . . . . . . . . . . . . . . . . . . . . . .  31
  Section 6.11 Performance by the Lender   . . . . . . . . . . . . . . . . . . . . .  31
  Section 6.12 Minimum Book Net Worth  . . . . . . . . . . . . . . . . . . . . . . .  32
  Section 6.13 Minimum Net Income  . . . . . . . . . . . . . . . . . . . . . . . . .  32
  Section 6.14 New Covenants   . . . . . . . . . . . . . . . . . . . . . . . . . . .  32
  Section 6.15 Premises  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  33
  Section 6.16 Off-Site Inventory  . . . . . . . . . . . . . . . . . . . . . . . . .  33

<PAGE>
ARTICLE VII    NEGATIVE COVENANTS  . . . . . . . . . . . . . . . . . . . . . . . . .  33

  Section 7.1  Liens . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  33
  Section 7.2  Indebtedness  . . . . . . . . . . . . . . . . . . . . . . . . . . . .  34
  Section 7.3  Guaranties  . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  34
  Section 7.4  Investments and Subsidiaries  . . . . . . . . . . . . . . . . . . . .  35
  Section 7.5  Dividends . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  35
  Section 7.6  Sale or Transfer of Assets; Suspension of Business Operations . . . .  35
  Section 7.7  Consolidation and Merger; Asset Acquisitions  . . . . . . . . . . . .  36
  Section 7.8  Sale and Leaseback  . . . . . . . . . . . . . . . . . . . . . . . . .  36
  Section 7.9  Restrictions on Nature of Business  . . . . . . . . . . . . . . . . .  36
  Section 7.10 Capital Expenditures  . . . . . . . . . . . . . . . . . . . . . . . .  36
  Section 7.11 Accounting  . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  36
  Section 7.12 Discounts, etc.   . . . . . . . . . . . . . . . . . . . . . . . . . .  36
  Section 7.13 Defined Benefit Pension Plans   . . . . . . . . . . . . . . . . . . .  36
  Section 7.15 Place of Business; Name   . . . . . . . . . . . . . . . . . . . . . .  36
  Section 7.16 Organizational Documents  . . . . . . . . . . . . . . . . . . . . . .  37
  Section 7.17 Salaries  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  37
  Section 7.18 Change in Ownership   . . . . . . . . . . . . . . . . . . . . . . . .  37

ARTICLE VIII   EVENTS OF DEFAULT, RIGHTS AND REMEDIES  . . . . . . . . . . . . . . .  37

  Section 8.1  Events of Default . . . . . . . . . . . . . . . . . . . . . . . . . .  37
  Section 8.2  Rights and Remedies . . . . . . . . . . . . . . . . . . . . . . . . .  39
  Section 8.3  Certain Notices . . . . . . . . . . . . . . . . . . . . . . . . . . .  40

<PAGE>
ARTICLE IX     MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . . . . . . .  40

  Section 9.1  No Waiver; Cumulative Remedies  . . . . . . . . . . . . . . . . . . .  40
  Section 9.2  Amendments, Etc.  . . . . . . . . . . . . . . . . . . . . . . . . . .  40
  Section 9.3  Addresses for Notices, Etc. . . . . . . . . . . . . . . . . . . . . .  40
  Section 9.4  Further Documents . . . . . . . . . . . . . . . . . . . . . . . . . .  41
  Section 9.5  Collateral  . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  41
  Section 9.6  Costs and Expenses  . . . . . . . . . . . . . . . . . . . . . . . . .  42
  Section 9.7  Indemnity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  42
  Section 9.8  Participants  . . . . . . . . . . . . . . . . . . . . . . . . . . . .  43
  Section 9.9  Execution in Counterparts . . . . . . . . . . . . . . . . . . . . . .  43
  Section 9.10 Binding Effect; Assignment; Complete Agreement; Exchanging
               Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  43
  Section 9.11 Severability of Provisions  . . . . . . . . . . . . . . . . . . . . .  43
  Section 9.12 Headings  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  43
  Section 9.13 Governing Law; Jurisdiction, Venue; Waiver of Jury Trial  . . . . . .  43
  Section 9.14 Release of Collateral   . . . . . . . . . . . . . . . . . . . . . . .  44
  Section 9.15 Termination, Release    . . . . . . . . . . . . . . . . . . . . . . .  44
  Section 9.16 Confidentiality   . . . . . . . . . . . . . . . . . . . . . . . . . .  44
</TABLE>

<PAGE>Exhibit  10.27

                      OFFICE AND INDUSTRIAL BUILDING LEASE

                                 BY AND BETWEEN

                             CHEROKEE EQUITIES, LLC
                                  AS "LANDLORD"

                                       AND

                                 ROCKSHOX, INC.
                                   AS "TENANT"

<PAGE>
<TABLE>
<CAPTION>
                            INDEX

ARTICLE  NO.                TITLE                             PAGE  NO.
<S>        <C>                                                <C>
BASIC  LEASE  PROVISIONS                                       1

OFFICE  LEASE  PROVISIONS
-------------------------
I          Leased Premises; Common Areas                       5
II         Term                                                6
III        Minimum Rent; Additional Rent; Operating Costs      8
IV         Services and Expenses                              10
V          Real Estate Taxes and Assessments                  11
VI         Utilities                                          11
VII        Insurance                                          12
VIII       Maintenance of the Building and Repairs            13
IX         Property and Common Area Parking                   14
X          Quiet Enjoyment; Care of Leased Premises           15
XI         Signs and Advertising                              15
XII        Use of Leased Premises                             16
XIII       Alterations and Additions                          16
XIV        Waiver of Subrogation                              16
XV         Destruction of or Damage to Leased Premises        16
XVI        Eminent Domain                                     17
XVII       Indemnification                                    18
XVIII      Assignment and Subletting                          18
XIX        Landlord's Sale or Transfer                        19
XX         Default                                            19
XXI        Option to Extend                                   21
XXII       Late Rent Payment                                  22
XXIII      Non-Disturbance and Subordination                  23
XXIV       Notices                                            23
XXV        Security Deposit - Letter of Credit                23
XXVI       Miscellaneous                                      24

EXHIBITS

Exhibit A  Plat Map of Building and Property
Exhibit B  Depiction of Building Space Plan
Exhibit C  Form of Letter of Credit
Exhibit D  Form of Work Letter for Expansion Space
Exhibit E  Rules and Regulations
Exhibit F  Depiction of Common Areas of the Project
Exhibit G  Description of Initial Space Improvement Work and
           Existing Space Improvement Work
Exhibit H  Form of Tenant Estoppel Statement
</TABLE>

                                       -i-
<PAGE>
                             BASIC LEASE PROVISIONS

     THIS  SUMMARY  OF  BASIC LEASE PROVISIONS (the "Basic Lease Provisions") to
the  attached  "Office  and  Industrial Building Lease" (the "Lease") is entered
                --------------------------------------
into  by  and  between Landlord and Tenant as of the date first set forth in the
Lease,  for  purposes of convenience with respect to the terms and conditions of
the  Lease,  and  is  hereby  made  a  part  of  the Lease.  In the event of any
conflict,  inconsistency or ambiguity between the Basic Lease Provisions and the
attached  Lease,  the  attached  Lease  shall  govern.

A.     LANDLORD:     "Landlord"  means CHEROKEE EQUITIES, LLC A COLORADO LIMITED
       --------
                    LIABILITY COMPANY,  and its successors and assigns (Landlord
                    and  Tenant  each   acknowledge   that  Landlord   currently
                    contemplates  assigning  this  Lease to Hexokee at some time
                    during   the  first  year  of  the  Lease   Term,   as  more
                    particularly  discussed  below;  however,  Landlord  has not
                    warranted that any such transfer and assignment  will occur,
                    and  Tenant  is not  entering  into this  Lease in  reliance
                    thereon ).

B.     LANDLORD'S  ADDRESS  FOR  NOTICE:
       --------------------------------

                    5260  Mark  Dabling  Boulevard
                    Colorado  Springs,  CO  80918
                    Attn:  Link  Jackson
                    Phone  (719)  590-9955
                    Fax    (719)  598-4521

C.     TENANT:      "Tenant"  means  ROCKSHOX,  INC.,  A  DELAWARE  CORPORATION.
       ------

D.     TENANT'S  ADDRESS  FOR  NOTICE:
       ------------------------------

                    1610  Garden  of  the  Gods  Road
                    Colorado  Springs,  CO  80907
                    Attn:  Bryan  Kelln,  President
                    Phone  (719)  278-2999
                    Fax     (719)  278-1529

                    With  a  copy  to:
                    -----------------
                    David  W.  Isbell,  Esq.
                    90  S.  Cascade  Ave.,  Suite  1300
                    Colorado  Springs,  CO  80903
                    Phone  (719)  473-3800
                    Fax     (719)  633-1518

E.     HEXOKEE:     HEXOKEE,  LLLP,  A  COLORADO  LIMITED  LIABILITY  LIMITED
       -------
                    PARTNERSHIP  (or its  successors  and assigns)  which is the
                    owner of Lot 5, Lot 4 and Lot 3, Kaman Sciences  Subdivision
                    No. 3 (a replat of Kaman Sciences Subdivisions Numbers 1 and
                    2) in the  City of  Colorado  Springs,  County  of El  Paso,
                    Colorado  (hereinafter,  the  "Kaman  Subdivision"),   which
                    comprises  the Project  surrounding  the  Property,  as more
                    particularly  depicted  on the plat map  attached  hereto as
                    Exhibit "A". ------------

F.     BUILDING:     "Building"  means Building 6 in the Kaman Subdivision which
       --------
                    currently  comprises  approximately  52,500  rentable square
                    feet of office,  manufacturing,  assembly,  distribution and
                    warehousing  space.  The  Building  has an  address  of 1610
                    Garden of the Gods Road,  Colorado  Springs,  Colorado,  and
                    together with its related parking areas and improvements, is
                    located on certain real property more particularly described
                    as: "Lot 1 and Lot 2, Kaman  Sciences  Subdivision  No. 3, a
                         -------------------------------------------------------
                    replat of Kaman Sciences  Subdivisions Number 1 and 2 in the
                    ------------------------------------------------------------
                    City of Colorado  Springs,  County of El Paso,  Colorado" as
                    --------------------------------------------------------
                    more  particularly  depicted on the plat map attached hereto
                    as Exhibit  "A" and  incorporated  herein by this  reference
                       ------------
                    (the "Property").  References herein to the Building in this
                    Lease shall  include,  from and after the date of Landlord's
                    completion  thereof,  all of the Expansion Space (as defined
                    below) to be  constructed by Landlord and accepted by Tenant
                    as contemplated hereby, which Expansion Space will cause the
                    total rentable square footage of the Building to comprise no
                    less than 82,500 rentable square feet.

                                      -2-
<PAGE>
G.     LEASED  PREMISES:     "Leased  Premises"  means  the approximately 82,500
       ----------------
                    office,    manufacturing,    assembly,    distribution   and
                    warehousing space within the Building  (assuming  completion
                    of 30,000 square feet of the Expansion Space),  which Leased
                    Premises are depicted on the floor plan  attached  hereto as
                    Exhibit "B".  The  foregoing  notwithstanding,  Landlord and
                    -----------
                    Tenant  each  understand  that the Leased  Premises  will be
                    initially  occupied in phases;  such that:  (i) Tenant shall
                    occupy  approximately  15,000  rentable  square  feet of the
                    Building  (the  "Initial  Space")  comprised  of  that  area
                    identified  as such on Exhibit "B" from July 1, 2000 through
                                           -----------      ------------
                    October 1, 2000,  (ii) Tenant  shall  thereafter  occupy the
                    ---------------
                    balance of the existing  52,500  rentable square feet of the
                    Building  (the  "Existing  Space")  comprised  of that  area
                    identified  as such on  Exhibit  "B" from  October  1,  2000
                                            ------------       -----------------
                    through  approximately  May 1,  2001,  and (iii) by no later
                                            ------------
                    than August 1, 2000 Tenant shall  notify  Landlord as to the
                         --------------
                    size of the  contemplated  expansion of the  Building  (such
                    expansion  to be no less  than  30,000  additional  rentable
                    square  feet and no more  than  50,000  additional  rentable
                    square  feet as more  particularly  described  herein)  (the
                    "Expansion  Space") to be located  in the  approximate  area
                    shown on Exhibit "B", and Landlord shall,  following receipt
                             -----------
                    of such  notice,  commence  construction  of such  Expansion
                    Space  and  deliver  the same to  Tenant  on or about May 1,
                                                                          ------
                    2001,  all  as  more   particularly   contemplated   herein.
                    ----
                    Thereafter,  Tenant  shall  occupy the  Initial  Space,  the
                    Existing Space and the Expansion  Space until the expiration
                    of this Lease on April 30, 2011.
                                     --------------

H.     TENANT'S  PRO-RATA
       ------------------
       PROJECT  COMMON  AREA
       ---------------------
       SHARE
       -----

                    For  purposes of this Lease,  and from and after  Landlord's
                    contemplated sale or transfer of the Property and assignment
                    of  Landlord's  rights  under  this  Lease  to  Hexokee,  or
                    Landlord  otherwise  securing  Tenant's rights to the use of
                    the  Common  Areas of the  Project  (as  defined  herein) by
                    contractual  agreement  with  Hexokee,  all as  contemplated
                    herein,  "Tenant's Pro-Rata Project Common Area Share" shall
                    mean 14.29% prior to completion  of the Expansion  Space for
                         ------
                    the Building, and 29.97% following completion,  delivery and
                                      ------
                    acceptance  of the  Expansion  Space  for the  Building,  as
                    applicable, such percentage being determined on the basis of
                    a  fraction,  the  numerator  of which is the  total  square
                    footage  of  Lot  1  of  the  Kaman   Subdivision  prior  to
                    completion,  delivery and acceptance of the Expansion Space,
                    and the total square footage of Lot 1 and Lot 2 of the Kaman
                    Subdivision following completion, delivery and acceptance of
                    the Expansion  Space,  and the  denominator  of which is the
                    total square footage of Lot 1, Lot 2, Lot 4 and Lot 5 of the
                    Kaman Subdivision.

I.     LEASE  TERM: The  "Lease  Term"  of the Lease shall be 130 months, as
       -----------
                    more particularly described  in  Article  II  "Term"  below.

                                      -3-
<PAGE>
J.     MINIMUM  RENT:     "Minimum  Rent" means the base rent which Tenant shall
       -------------
                    pay each month,  exclusive of additional rent and other sums
                    and charges due under this Lease.  The Minimum  Rent payable
                    for the  Leased  Premises  during the Lease Term shall be as
                    follows (assuming  delivery of the Expansion Space by May 1,
                                                                          ------
                    2001:
                    ----

<TABLE>
<CAPTION>
MINIMUM  RENT SCHEDULE ASSUMING MAY 1, 2001 DELIVERY OF 30,000 SQ. FT. EXPANSION SPACE:
---------------------------------------------------------------------------------------
<S>                   <C>            <C>             <C>            <C>
Period                Annual Rate    Square Footage  Monthly Rent   Total Minimum Rents
--------------------  -------------  --------------  -------------  --------------------
07/01/00 to 09/30/00  $7.75/sq. ft.  15,000 sq. ft.  $    9,687.50  $          29,062.50
10/01/00 to 01/31/01  $7.75/sq. ft.  52,500 sq. ft.  $   33,906.25  $         135,625.00
02/01/01 to 04/30/01  $8.25/sq. ft.  52,500 sq. ft.  $   36,093.75  $         108,281.25
05/01/01 to 04/30/02  $8.25/sq. ft.  82,500 sq. ft.  $   56,718.75  $         680,625.00
05/01/02 to 04/30/03  $8.25/sq. ft.  82,500 sq. ft.  $   56,718.75  $         680,625.00
05/01/03 to 04/30/04  $8.66/sq. ft.  82,500 sq. ft.  $   59,537.50  $         714,450.00
05/01/04 to 04/30/05  $8.66/sq. ft.  82,500 sq. ft.  $   59,537.50  $         714,450.00
05/01/05 to 04/30/06  $9.10/sq. ft.  82,500 sq. ft.  $   62,562.50  $         750,750.00
05/01/06 to 04/30/07  $ 9.10/sq.ft.  82,500 sq. ft.  $   62,562.50  $         750,750.00
05/01/07 to 04/30/08  $ 9.56/sq.ft.  82,500 sq. ft.  $   65,725.00  $         788,700.00
05/01/08 to 04/30/09  $ 9.56/sq.ft.  82,500 sq. ft.  $   65,725.00  $         788.700.00
05/01/09 to 04/30/10  $10.04/sq.ft.  82,500 sq. ft.  $   69,025.00  $         828,300.00
05/01/10 to 04/30/11  $10.04/sq.ft.  82,500 sq. ft.  $   69,025.00  $         828,300.00
</TABLE>

     (Landlord  and  Tenant  each agree that the foregoing Minimum Rent Schedule
shall be revised by way of an amendment to this Lease in the event the Expansion
Space  is  not  delivered  on  May  1, 2001 or to the extent the Expansion Space
contains  more  than  30,000  rentable  square  feet.)

K.     SECURITY  DEPOSIT:     The  "Security  Deposit" shall be in the amount of
       -----------------

                    $0.00,  provided,  however,  that  in  lieu  of  a  Security
                    Deposit,  Tenant  shall  secure its  obligations  under this
                    Lease by way of an Irrevocable  Sight Draft Letter of Credit
                    from Wells Fargo Bank, N.A. (or other  institutional  lender
                    reasonably  acceptable  to  Landlord)  bearing  a  principal
                    amount of  $1,000,000  and having a term of no less than one
                    (1) year,  with Tenant being  obligated to renew such letter
                    of  credit  no later  than  thirty  (30)  days  prior to the
                    expiration  of the  term  thereof,  with  no  gap  occurring
                    between  the  terms,  all  as  more  particularly  described
                    herein.  The letter of credit shall be in the form  attached
                    as Exhibit "C" hereto (the "Letter of Credit"),  and must be
                       -----------
                    delivered  to  Landlord   concurrently   with  the  parties'
                    execution of this Lease and as a condition  precedent to any
                    occupancy by Tenant and to any  obligation of Landlord under
                    this  Lease.  The  foregoing  notwithstanding,  in the event
                    Landlord should at any time draw upon such Letter of Credit,
                    all amounts held by Landlord  and not used to cure  Tenant's
                    default shall be held as a Security  Deposit pursuant to the
                    provisions  of  Article  XXV  "Security  Deposit - Letter of
                                                  ------------------------------
                    Credit" of the Lease.
                    ---------------------

L.     PARKING  SPACES:     Tenant shall have the non-exclusive right to the use
       ---------------
                    of three and one-half  (3.5)  unreserved  parking spaces per
                    1,000 sq. ft. of the Leased Premises, such parking spaces to
                    be located on the  Property  (or in the Common  Areas of the
                    Project  following  Landlord's  transfer of the Property and
                    assignment  of its  rights  as  Landlord  under the Lease to
                    Hexokee  or  Landlord   otherwise   securing   from  Hexokee
                    contractual  rights for  Tenant's use of the Common Areas of
                    the Project,  as contemplated  herein) and to be utilized by
                    Tenant  pursuant to the  provisions  of Article IX "Property
                                                                        --------
                    and Common  Area Parking"  of the Lease.
                    ------------------------

M.     EXPANSION  SPACE
       ----------------

       WORK LETTER:     means a work letter, to be negotiated  between  Landlord
       -----------
                    and Tenant and substantially in the general form attached as
                    Exhibit "D" hereto, pursuant  to  which  Landlord  shall
                    -----------
                    complete the construction  and  delivery  of  the  Expansion
                    Space.

                                      -4-
<PAGE>
     OFFICE  AND  INDUSTRIAL  BUILDING  LEASE

     THIS OFFICE AND INDUSTRIAL BUILDING LEASE (the "Lease"), is entered into as
of this day of June, 2000 in Colorado Springs, Colorado, by and between CHEROKEE
EQUITIES,  LLC,  A  COLORADO  LIMITED  LIABILITY  COMPANY,  together  with  its
successors  and  assigns, as "Landlord" hereunder and ROCKSHOX, INC., A DELAWARE
CORPORATION,  together  with  its successors and assigns, as "Tenant" hereunder,
all  with  respect  to  the  following:

     A. Landlord is the owner of Lot 1 and Lot 2 in the Kaman  Subdivision,  and
Hexokee is the owner of Lot 3, Lot 4 and Lot 5 in the Kaman Subdivision,  all as
more  particularly  depicted on the plat map attached  hereto as Exhibit "A" and
                                                                 -----------
incorporated herein by this reference;

     B. Landlord has advised Tenant that, as between Landlord and Hexokee,  Lots
1 through 5 of the Kaman Subdivision  generally comprise a single business park,
with certain common areas,  common  elements,  reciprocal  driveway and alleyway
areas  and  reciprocal  parking  (hereinafter   sometimes  referred  to  as  the
"Project");  provided,  however,  that Landlord and Hexokee have  structured the
leases for their  respective  properties and their related  buildings within the
Project such that typical common area  maintenance  work is not always performed
by Landlord and Hexokee,  and thus charges for such operation and maintenance of
these common areas is not necessarily  passed through to the various tenants and
users within the Project;

     C. In  connection  with this  Lease,  Landlord  has  advised  Tenant  that,
following the parties' execution of this Lease and at some time during the first
year of the Lease  Term,  Landlord  contemplates  transferring  the  Property to
Hexokee, and concurrently  assigning its rights and obligations under this Lease
to Hexokee,  and having  Hexokee  assume the same,  all such that  Hexokee  will
become the owner of all of the various  Lots within the Kaman  Subdivision.  The
foregoing  notwithstanding,  Landlord has not given Tenant  assurances that such
transfer  and  assignment  will  occur,  but only  indicated  that  this is what
Landlord currently contemplates.  In the event such transfer and assignment does
occur,  Landlord and Tenant each intend that,  upon such transfer and assignment
and upon unification of the interests of Hexokee and Landlord hereunder,  all of
the obligations and covenants of Landlord hereunder would become the obligations
and covenants of Hexokee,  in its capacity as Landlord  following  such transfer
and assignment,  and would be evidenced by an Assignment and Assumption of Lease
Agreement in a form reasonably acceptable to Landlord,  Tenant and Hexokee. (The
foregoing  contemplated transfer and assignment to Hexokee is sometimes referred
to herein as the "Hexokee Transfer and Assignment");

     D. In the event  the  Hexokee  Transfer  and  Assignment  does not occur as
contemplated  above,  then  Landlord  intends to acquire  from  Hexokee,  or its
successor,  contractual rights to the use of the Common Areas of the Project for
the benefit of the Property,  which contractual  rights would entitle Tenant and
its  successors  and assigns the right to use and enjoy the Common  Areas of the
Project in the same  general  manner as if the Property and the Project had been
unified by the transfer and  assignment  of the Property and  Landlord's  rights
under this Lease. (The foregoing contractual arrangement with Hexokee concerning
the Common Areas of the Project is sometimes  referred to herein as the "Hexokee
Common Area  Agreement";  and the  "Hexokee  Transfer  and  Assignment"  and the
"Hexokee Common Area Agreement" are sometimes collectively referred to herein as
the "Hexokee Transaction");

     E. In  furtherance of the  anticipated  Hexokee  Transaction,  Landlord and
Tenant intend for Tenant to thereafter have the  non-exclusive  right to use the
Common Areas of the Project,  and to thereafter become  responsible for Tenant's
Pro-Rata  Project Common Area Share of the Operating  Costs (as defined  herein)
associated  with Hexokee's  maintenance of those portions of the Project defined
herein as the  Common  Areas,  and for  Hexokee  to assume or  otherwise  become
contractually  obligated  to perform all  maintenance  and repair of such Common
Areas,  all as more  particularly  set forth  herein.  Landlord  and Tenant each
acknowledge  that,  until such time as the  Hexokee  Transaction  is  completed,
Tenant  shall  not have any  rights  associated  with  the  Common  Areas of the
Project,  or any  obligation  to  contribute  toward the costs of operating  and
maintaining the Common Areas of the Project, and will only have the specific

                                      -5-
<PAGE>
leasehold  rights  concerning the Property, the Building and the Leased Premises
which  are  reflected  in  this Lease between Landlord and Tenant, together with
rights of access to the Property, the Building and the Leased Premises by way of
reciprocal  easements  which  are  of  record and which benefit the Property and
currently  encumber  all of the various lots within the Kaman Subdivision.  Upon
completion  of the Hexokee Transaction, Landlord and Tenant intend for Tenant to
thereafter  have the non-exclusive right to use the Common Areas of the Project,
and  to assume the obligation to pay Tenant's Pro-Rata Project Common Area Share
of the Operating Costs for such Common Areas, all as more particularly set forth
herein;  and

     F.  Landlord now desires to lease the  Building and the Leased  Premises to
Tenant,  and Tenant  desires to lease the Building and the Leased  Premises from
Landlord, all as more particularly described herein.

                                      AGREEMENT

     NOW,  THEREFORE,  In  consideration  of  the premises, the mutual covenants
hereinafter contained, and each and every act to be performed hereunder by them,
Landlord  and  Tenant  hereby  enter  into the following Lease pertaining to the
Leased  Premises:

                                      ARTICLE  I
                         LEASED  PREMISES;  COMMON  AREAS

     Landlord  hereby  lets and demises to Tenant, and Tenant hereby leases from
Landlord, for the Lease Term and upon the terms and conditions set forth in this
Lease, the Property, the Building and the Leased Premises, which Leased Premises
are  located  in  the Building and are more particularly outlined on Exhibit "B"
                                                                     -----------
attached hereto.  As indicated in the Basic Lease Provisions above, Landlord and
Tenant  have  agreed  that  Tenant  shall  occupy the Leased Premises in phases,
occupying  the  Initial  Space from July 1, 2000 through September 30, 2000, and
                                    ------------         ------------------
thereafter  occupying both the Initial Space and the Existing Space from October
                                                                         -------
1,  2000  through  the  date of Landlord's delivery of the Expansion Space on or
--------
about  May  1, 2001.  Following Landlord's delivery of the Expansion Space on or
       ------------
about May 1, 2001, Tenant shall occupy the Initial Space, the Existing Space and
      -----------
the  Expansion  Space  through  the  expiration of this Lease on April 30, 2011.
                                                                 --------------
Landlord  hereby represents and warrants that the square footage figures for the
Initial  Space and the Existing Space as set forth in the Basic Lease Provisions
have  been measured in conformance with the American National Standard Method of
Measuring  Floor  Area  in  Office  Buildings  ANSI Z65.1-1980, published by the
Building  Owners  and  Managers  Association  International  for  purposes  of
calculating  the  Minimum  Rent  payable  by  Tenant.  In addition, Landlord and
Tenant  shall  use such standards for purposes of measuring the Expansion Space.
Tenant  shall  have  the  right,  at any time during the Lease Term to cause the
Initial Space and the Existing Space to be re-measured (as well as the Expansion
Space  following  Landlord's delivery of the same) for purposes of adjusting the
Minimum  Rent  amounts which Tenant should pay under this Lease according to the
lease  rates  set  forth  in the Basic Lease Provisions above.  Tenant's use and
occupancy of the Property, the Building, the Leased Premises shall be subject to
the  rules  and  regulations for the use thereof prescribed from time to time by
Landlord,  a current copy of which is attached hereto as Exhibit "E" (the "Rules
                                                         -----------
and  Regulations").  Notwithstanding  the  foregoing,  Landlord  and Tenant each
agree  that,  to  the  extent the Rules and Regulations contain provisions which
conflict  with  the  provisions of this Lease, the provisions of the Lease shall
control.

     Landlord  and  Tenant  each  hereby understand, acknowledge and agree that,
following  Landlord's  completion  of  the Hexokee Transaction, Tenant's use and
occupation of the Property, the Building and the Leased Premises will thereafter
include  the non-exclusive right to use, in common with other owners and tenants
in  the  Project,  all  of the Common Areas of the Project, as more particularly
described  herein.  In  furtherance  of  the  foregoing,  Landlord  and  Tenant
understand,  acknowledge  and  agree  that  the  Hexokee  Transaction  will  be
accomplished  pursuant  to  either:  (i)  an  Assignment and Assumption of Lease
Agreement  in  a  form reasonably satisfactory to Landlord and Tenant, or (ii) a
contractual agreement between Landlord and Hexokee, for the benefit of Landlord,
Tenant  and  the  Property,  in  a  form reasonably satisfactory to Landlord and
Tenant, and Landlord hereby covenants to use commercially reasonable, good faith
efforts  to  cause  the  Hexokee  Transaction  to occur; provided, however, that
Tenant  hereby  acknowledges  that Landlord has not warranted or otherwise given
Tenant  any assurances that the Hexokee Transaction will occur, or that Landlord
will  otherwise be able to cause the Hexokee Transaction to occur.  In the event

                                      -6-
<PAGE>
Landlord  is  able  to cause the Hexokee Transaction to occur, then Landlord and
Tenant  each  understand  and  agree that, pursuant to the terms of such Hexokee
Transaction,  Hexokee  will  expressly agree to assume all of the obligations of
this  Lease concerning the provision of, operation and maintenance of the Common
Areas,  and will covenant and agree to provide, operate and maintain all "Common
Areas"  of  the  Project  for  the  non-exclusive  use of Tenant, its employees,
agents, servants, customers and other invitees (hereinafter, "Tenant's Agents"),
in  common  with  Landlord,  other  tenants  and users of the Project, and their
respective  employees,  agents,  servants,  customers, and invitees, except when
such  are  being  repaired,  altered  or  reconstructed,  and except as provided
hereinafter.  As  the  term  is  used  herein,  and  for  purposes of this Lease
following  completion  of  the  Hexokee  Transfer and Assignment, "Common Areas"
shall  mean:  (i)  the  sidewalks,  service  roads,  driveway  areas, alleyways,
truckways,  delivery  passages, curbs, parking areas and loading facilities more
particularly  depicted  on  Exhibit  "F"  attached  hereto,  together  with  all
                            ------------
lighting,  fencing and other amenities associated therewith, (ii) the landscaped
areas  fronting Garden of the Gods Road as more particularly depicted in Exhibit
                                                                         -------
"F"  attached hereto, including all irrigation and drainage systems servicing or
---
otherwise  associated  with the same, and (iii) the monument signs identified on
Exhibit  "F"  attached  hereto,  including  all electrical systems servicing the
-----------
same.  Landlord  and  Tenant  each  further  agree  that,  following the Hexokee
Transaction,  all  other  areas  of the Project will be and hereby are expressly
excluded  from  the Common Areas, and Tenant shall not have the right to the use
thereof,  and  shall  not  be  obligated  to  contribute  toward the cost of the
operation  and  maintenance  thereof, it being the understanding of Landlord and
Tenant that other tenants or users of the remaining portions of the Project have
separate obligations to maintain such areas, at their sole cost and expense, and
therefore, the same are not to be included within Common Areas under this Lease.
In  connection  with  its  use  of  the  Common  Areas  following  the  Hexokee
Transaction,  Tenant  hereby  agrees that it will not at any time interfere with
the  rights  of  Landlord  and  others  entitled to similar use of Common Areas.

     All  Common  Areas  furnished  by  Landlord  (or Hexokee in the case of the
Hexokee  Common  Area  Agreement,  as  the  case  may  be) following the Hexokee
Transaction,  shall  be  subject  to  the  reasonable  control and management of
Landlord  (or  Hexokee  in the case of the Hexokee Common Area Agreement, as the
case  may be) who shall have the right, and the obligation, from time to time to
establish,  modify  and  enforce the rules and regulations with respect thereto.
Tenant agrees to abide by all such rules and regulations at all times during the
Lease Term.  Following the Hexokee Transaction, Landlord (or Hexokee in the case
of  the  Hexokee  Common  Area Agreement, as the case may be) shall be deemed to
have  reserved,  and  hereby  does  reserve  the  right  to  change the area, to
rearrange  the  area,  and to restrict or eliminate the use of any Common Areas,
and do such other acts in and to Common Areas to change the location of building
areas  of  the Project as Landlord (or Hexokee in the case of the Hexokee Common
Area  Agreement, as the case may be) shall reasonably determine, all in the best
interests  of  the Project, the Building, the Property and the other tenants and
occupants  of  the  Project;  provided,  however,  that  no  such  change  shall
materially diminish or otherwise adversely affect Tenant's rights to the use and
enjoyment of the Leased Premises, the Building, the Property or the Common Areas
of  the  Project.  Such  actions  may  not  be deemed an eviction of Tenant or a
disturbance  of  Tenant's use of the Leased Premises or the Common Area portions
of  the  Project.  Following  the  Hexokee Transaction (and prior to the Hexokee
Transaction  given  that Tenant has no rights to the Common Areas of the Project
prior  to  the  Hexokee Transaction), no sign or advertising shall be displayed,
within  the  Common  Area without consent of Landlord (or Hexokee in the case of
the  Hexokee  Common  Area  Agreement,  as  the  case  may  be).

                                   ARTICLE  II
                                      TERM

     A.     LEASE  TERM.  The  Lease Term shall be for a period of approximately
            -----------
one  hundred  thirty (130) months beginning on the later of:  (i) twelve o'clock
midnight  on June 30, 2000 (with respect to the Initial Space only), or (ii) the
             -------------
date  upon  which  Landlord  delivers  the  Initial  Space portion of the Leased
Premises  to  Tenant  in  a  state  of  "Substantial  Completion"  (the  "Lease
Commencement  Date").  The  Lease  Term  will  thereafter  continue until twelve
o'clock  midnight  on  April  30, 2011 (the "Lease Termination Date"); provided,
                       ---------------
however, if the Lease Commencement Date occurs on a day other than the first day
of  a  calendar  month,  the  Minimum Rent, at the rate provided above, shall be
prorated  for  such  partial  month,  on  a per diem basis, and shall be due and
payable  on  the  actual  Lease  Commencement  Date.  Following the actual Lease
Commencement  Date, Landlord and Tenant shall execute an Addendum to this Lease,
setting  forth  the  exact  Lease  Commencement  Date  of  the  Lease  Term.

                                      -7-
<PAGE>
     B.     LANDLORD'S  COMPLETION  AND  DELIVERY  OF  INITIAL  SPACE.  Landlord
            ---------------------------------------------------------
hereby  covenants  and  agrees to construct, complete and perform, at Landlord's
sole  cost  and expense, certain works of improvement to the Initial Space prior
to  Landlord's  delivery  thereof  to  Tenant  and  as  a condition precedent to
Tenant's  occupation thereof and payment of Minimum Rent therefor.  The works of
improvement  which  Landlord covenants to construct, complete and perform to the
Initial  Space  are  more  particularly set forth in Exhibit "G" attached hereto
                                                     -----------
(the  "Initial  Space  Improvement  Work").  In  connection  therewith, Landlord
hereby  agrees  to  immediately  commence the Initial Space Improvement Work and
diligently  prosecute the same to completion so as to enable Landlord to deliver
the Initial Space to Tenant in a state of Substantial Completion on July 1, 2000
                                                                    ------------
as  contemplated  by this Lease.  In addition, Landlord shall cooperate with the
Tenant  in  the  installation  of  Tenant's  various  data,  telecom  and  power
requirements  in  the  Initial Space, and Landlord hereby agrees to purchase and
install, at Landlord's sole cost and expense, all of Tenant's telephone and data
wiring  in  the  Initial Space.  Upon Landlord's completion of the Initial Space
Improvement  Work, Landlord and Tenant shall conduct a final walk-through of the
Initial Space for purposes of confirming that all such Initial Space Improvement
Work  has been Substantially Completed.  In the event it is determined that such
Initial  Space  Improvement  Work has not been Substantially Completed, Landlord
shall continue its work and shall re-schedule another walk-through in the manner
herein  described.  In  such  walk-through,  Landlord and Tenant shall prepare a
written  punch  list  of  items in need of completion or correction, if any, but
which  do  not  preclude  Tenant  from operating its business within the Initial
Space  (the  "Punch List"), which Punch List shall be signed by the Landlord and
the Tenant at the time of the walk-through and prior to Tenant taking possession
of  the  Initial Space.  Upon Landlord's completion of the Punch List items, and
with  the exception of "latent defects" (as defined below), by taking possession
of  the  Initial Space, Tenant will be deemed to have accepted the Initial Space
in  its condition on the date of delivery of possession and to have acknowledged
that  Landlord  has  completed the Initial Space Improvement Work as required by
this  Lease.  For  purposes  of  this  Lease:  (i)  "Substantial  Completion" or
"Substantially  Completed"  shall  mean that Landlord has sufficiently completed
the  Initial  Space  Improvement Work or the Existing Space Improvement Work, as
applicable,  in  accordance  with  Exhibit  "G"  such  that  Tenant can commence
                                   ------------
installation of its furnishings, fixtures and equipment in the Initial Space and
the  Existing  Space,  as  applicable,  and  is  able to obtain a Certificate of
Occupancy authorizing Tenant to occupy the Initial Space and the Existing Space,
as  applicable,  for the conduct of its business therein, all in compliance with
building  code  requirements  of  the  Pikes  Peak Regional Building Department,
requirements  of  the Colorado Springs Fire Marshall, or the requirements of any
other  governmental agency having authority over the Building, the Initial Space
or  the  Existing Space; and (ii) a "latent defect" is a defect in the condition
of  the  Initial  Space,  the  Existing  Space or the Building either previously
existing or otherwise caused by Landlord's failure to construct and complete the
Initial  Space  Improvement  Work  or  the  Existing  Space Improvement Work, as
applicable,  in a good and workmanlike manner, which defect would not ordinarily
be  observed during a walk-through inspection.  If Tenant notifies Landlord of a
latent  defect, then Landlord, at its expense, will repair such latent defect as
soon  as  reasonably  practicable.  (The foregoing notwithstanding, Landlord has
advised  Tenant that certain of the window installations contemplated in Exhibit
                                                                         -------
"G"  may  not be fully completed by July 1, 2000, and Tenant has agreed that the
---                                 ------------
same  will  not  cause  a  failure  of  Landlord's Substantial Completion of the
Initial  Space  Improvement Work so long as Tenant is legally entitled to occupy
the  Initial  Space,  and  Landlord  thereafter  diligently  prosecutes  the
installation  of  such  windows  to  completion.)

     C.     LANDLORD'S  COMPLETION  AND  DELIVERY  OF  EXISTING SPACE.  Landlord
            ---------------------------------------------------------
further  covenants  and agrees to construct, complete and perform, at Landlord's
sole  cost and expense, certain works of improvement to the Existing Space prior
to  Landlord's  delivery thereof to Tenant on October 1, 2000 and as a condition
                                              ---------------
precedent  to Tenant's occupation thereof and payment of Minimum Rent therefore.
The  works  of  improvement  which Landlord covenants to construct, complete and
perform  to  the  Existing  Space are more particularly set forth in Exhibit "G"
                                                                     -----------
attached  hereto  (the  "Existing  Space  Improvement  Work").  In  connection
therewith,  Landlord  hereby  agrees  to immediately commence the Existing Space
Improvement Work and diligently prosecute the same to completion so as to enable
Landlord  to  delivery  the  Existing  Space to Tenant in a state of Substantial
Completion  on  October  1, 2000 as contemplated by this Lease.  In addition, as
                ----------------
with Landlord's delivery of the Initial Space, Landlord shall cooperate with the
Tenant  in  the  installation  of  Tenant's  various  data,  telecom  and  power
requirements  in  the Existing Space, and Landlord hereby agrees to purchase and
install, at Landlord's sole cost and expense, all of Tenant's telephone and data
wiring  in the Existing Space.  Upon Landlord's completion of the Existing Space
Improvement Work, Landlord and Tenant shall conduct a similar final walk-through
of  the  Existing  Space for purposes of confirming that all such Existing Space
Improvement  Work  has  been  Substantially  Completed.  In  the  event  it  is
determined  that such Existing Space Improvement Work has not been Substantially
Completed,  Landlord  shall  continue  its  work  and  shall re-schedule another
walk-through in the manner herein described.  In such walk-through, Landlord and

                                      -8-
<PAGE>
Tenant  shall  prepare  a  similar  Punch List of items in need of completion or
correction, if any, but which do not preclude Tenant from operating its business
within  the Existing Space, which Punch List shall be signed by the Landlord and
the Tenant at the time of the walk-through and prior to Tenant taking possession
of  the Existing Space.  Upon Landlord's completion of the Punch List items, and
with  the  exception  of  "latent defects", by taking possession of the Existing
Space,  Tenant  will  be  deemed  to  have  accepted  the  Existing Space in its
condition  on  the  date of delivery of possession and to have acknowledged that
Landlord  has  completed the Existing Space Improvement Work as required by this
Lease.  If  Tenant  notifies  Landlord of a latent defect, then Landlord, at its
expense,  will  repair  such  latent  defect  as soon as reasonably practicable.

D.     LANDLORD'S  INSTALLATION  OF  NEW  ROOF.  In  connection  with Landlord's
       ---------------------------------------
delivery  of the Building, Landlord has agreed to cause the existing roof of the
Building  to  be in good working order, condition and repair, and to replace the
existing  roof of the Building in its entirety, which replacement Landlord shall
complete  on  or before October 1, 2000.  Thereafter, pursuant to the provisions
                        ---------------
of  Article  VIII  "Maintenance  of  the  Building and Repairs", Tenant shall be
                    ------------------------------------------
responsible  for  all  maintenance  of  the  roof.

E.     TENANT'S  ACCEPTANCE  AND OCCUPATION.  Upon Landlord's delivery to Tenant
       ------------------------------------
of  the  Initial  Space,  with  all  Initial  Space  Improvement  Work  being
Substantially  Completed, and upon Landlord's delivery to Tenant of the Existing
Space,  with  all Existing Space Improvement Work being Substantially Completed,
Tenant  agrees  to  accept delivery of the Initial Space and the Existing Space,
and  to  enter  upon  them  and  promptly  and diligently install its furniture,
fixtures  and equipment therein.  Landlord shall not be responsible nor have any
liability  whatsoever  at  any  time  for  loss  or damage to Tenant's fixtures,
equipment  or  other  property  of  Tenant  installed or placed by Tenant on the
Leased  Premises  (whether  during the Lease Term or pursuant to any Early Entry
Permit  entered  into  between  Landlord  and Tenant), except to the extent such
damage  or  loss  is  caused  by  Landlord's  or  Landlord's  employees, agents,
servants,  invitees,  contractors  or  subcontractors  (hereinafter, "Landlord's
Agents")  negligence or willful misconduct.  Any occupancy by Tenant of any area
of the Leased Premises prior to the Lease Commencement Date(s), whether pursuant
to  an  Early Entry Permit between Landlord and Tenant or pursuant to a deferred
rent  period,  shall  in all respects be the same as that of a Tenant under this
Lease.  In  addition,  Tenant  shall  not,  during  any  such  early  occupancy,
interfere  with  Landlord's  completion of the Initial Space Improvement Work or
Landlord's  completion  of  the  Existing  Space  Improvement  Work.

F.     LANDLORD'S CONSTRUCTION AND DELIVERY OF EXPANSION SPACE.  As contemplated
       -------------------------------------------------------
in  Article  I  above,  Landlord  and  Tenant  intend for Landlord to expand the
Building  to  provide  for  the  Expansion  Space,  which  Expansion  Space will
generally  be  located in the area shown on Exhibit "F" attached hereto and will
                                            -----------
be  constructed  at  Landlord's sole cost and expense.  In connection therewith,
Landlord  and  Tenant each agree that Tenant shall, on or before August 1, 2000,
                                                                 --------------
notify  Landlord  in writing as to Tenant's desired size for the Expansion Space
("Tenant's  Expansion  Space  Notification"), which Expansion Space Landlord and
Tenant  have  each agreed will be no less than an additional 30,000 rentable sq.
                                                             ------
ft.  of  space, and no more than an additional 50,000 rentable sq. ft. of space.
                                               ------
Landlord  and  Tenant  currently  contemplate  that approximately 5,000 rentable
square  feet  of the Expansion Space will be comprised of office space, and that
the  balance  will  be  comprised  of  manufacturing, assembly, distribution and
warehousing  space;  provided, however, that the precise specifications for such
designations  of  the  Expansion Space will be as more particularly set forth in
the  Expansion Space Work Letter.  Landlord and Tenant each understand and agree
that the Expansion Space will be completed, at Landlord's sole cost and expense,
to  approximately  the  same level of fit, finish, systems and equipment as will
exist  in  the  Initial Space and the Existing Space once Landlord has completed
the  Initial  Space  Improvement  Work and the Expansion Space Improvement Work.
Landlord and Tenant each acknowledge that the portion of the Property upon which
the  Expansion  Space  will  be  constructed  is  currently  encumbered  with  a
reciprocal  easement  agreement  for  the benefit of the Project.  In connection
with  Landlord's  completion  of  the Expansion Space, Landlord shall cause such
reciprocal  easement  to  either  be relocated or vacated in lieu of alternative
easement rights by way of a replat of the Property, all so as to insure that the
Expansion  Space  no  longer  encroaches  upon  easement  rights benefitting the
Project.

                                      -9-
<PAGE>
     Within  thirty  (30)  days  following  delivery of Tenant's Expansion Space
Notification,  Landlord  and Tenant shall negotiate and enter into the Expansion
Space  Work  Letter for purposes of clarifying the scope and level of finish for
the  Expansion  Space,  and for purposes of establishing Landlord's construction
and  delivery  schedule  for  the  Expansion  Space.  In  connection  therewith,
Landlord and Tenant each currently expect that they will agree upon the terms of
the  Expansion  Space  Work  Letter within such thirty (30) day period, and that
Landlord will obtain building permits for the Expansion Space within ninety (90)
days of Tenant's delivery of Tenant's Expansion Space Notification.  Thereafter,
Landlord  and  Tenant contemplate that Landlord will deliver the Expansion Space
in  a  state  of  Substantial Completion on or before May 1, 2001.  Landlord and
                                                      -----------
Tenant  each  hereby  agree  to  work  together in good faith in connection with
reaching agreement as to the final design and plans for the Expansion Space, and
in  causing  the  same  to  be  completed  and  delivery within the time periods
contemplated herein.  In the event Landlord's delivery of the Expansion Space is
delayed  such  that  the  Minimum  Rent  schedule  set  forth in the Basic Lease
Provisions  is  inaccurate, Landlord and Tenant shall enter into an amendment to
this  Lease  correcting  such  schedule.

                                   ARTICLE  III
                MINIMUM  RENT;  ADDITIONAL  RENT;  OPERATING  COSTS

     A.     MINIMUM  RENT.  Tenant  covenants and agrees to pay Minimum Rent for
            -------------
the  Leased  Premises for the full Lease Term, all at the rates set forth in the
Minimum  Rent Schedule set forth in the Basic Lease Provisions as applicable for
each  portion  of  the  Leased  Premises  delivered  to Tenant for occupation as
described  above,  subject  to  any  requisite  adjustments  to the Minimum Rent
Schedule  required  under this Lease.  All such Minimum Rent shall be payable in
monthly  installments, without setoff or deduction, without notice or demand, in
advance, on or before the first day of each calendar month during the Lease Term
at  the  address of Landlord set forth in the Basic Lease Provisions, or at such
other  address  or  addresses  as  Landlord may hereafter determine by notice to
Tenant.  The  parties  hereto hereby represent and warrant that the increases in
Minimum  Rent  provided  for  herein  during  the  Lease Term and any extensions
thereof:  (a)  have been negotiated at arm's length; (b) were prompted solely by
legitimate  business  and economic concerns; (c) represent Landlord's negotiated
arm's  length  bargain  to  recoup  a  maximum economic return on its investment
taking  into  account market conditions and inflationary considerations over the
Lease  Term  (including  any  extensions  thereof);  and  (d) represent Tenant's
negotiated  effort  to minimize to the greatest extent possible its rental costs
over  the  Lease  Term,  including  any  extensions  thereof.

     B.     ADDITIONAL  RENT.  It  is  the  purpose  and  intent of Landlord and
            ----------------
Tenant  that,  except  as  otherwise  expressly  set forth herein, the return to
Landlord  under  this Lease shall be absolutely "net" so that all costs directly
or  indirectly  attributable  to the Building, the Leased Premises, the Property
(and  Tenant's  Pro-Rata  Share of the Common Areas of the Project following the
Hexokee  Transaction) shall be the obligation of Tenant.  In connection with the
costs  directly  or  indirectly related to the Building, the Leased Premises and
the  Property,  Tenant has agreed to undertake substantially all maintenance and
repair  of  the Building and the Property, at Tenant's sole cost and expense, as
more  particularly  described  in  Article VIII "Maintenance of the Building and
                                                 -------------------------------
Repairs"  below.  In  connection with Landlord's obligation to contribute toward
-------
the  Building's  and the Property's share of the costs and expenses of operating
and  maintaining  the  Common  Area portions of the Project, Landlord and Tenant
hereby agree that, following completion of the Hexokee Transaction, Tenant shall
pay  Landlord  (either  directly  in  the  event  of  the  Hexokee  Transfer and
Assignment,  or  to  Landlord  as  reimbursement  for  Landlord's  contractual
obligations  to Hexokee in the case of the Hexokee Common Area Agreement, as the
case  may  be) as additional rent (the "Additional Rent") and in addition to the
Minimum Rent set forth above, Tenant's Pro-Rata Project Common Area Share of the
costs  and  expenses actually incurred by Landlord in connection with Landlord's
(or  Hexokee's in the case of the Hexokee Common Area Agreement, as the case may
be)  operation  and  maintenance  of the Common Areas (all such costs being more
particularly  described  below  and  being hereinafter referred to as "Operating
Costs").  The  liability of Tenant for the payment of such Additional Rent shall
commence  from  and  after Landlord's completion of the Hexokee Transaction, and
Hexokee's  execution  and  delivery  to  Landlord  and  Tenant  of either (i) an
Assignment  and  Assumption of Lease Agreement in a form reasonably satisfactory
to  Landlord,  Tenant  and  Hexokee,  or  (ii)  a  contractual agreement between
Landlord and Hexokee, for the benefit of Landlord, Tenant and the Property, in a
form  reasonably  satisfactory  to  Landlord  and  Tenant,  and  thereafter such
Additional  Rent  shall  be payable in advance on the first day of the month, at
the  same  time  and  place  stated  for  the  payment  of  the  Minimum  Rent.

                                      -10-
<PAGE>
In  connection  with  Tenant's  payment of Additional Rent following the Hexokee
Transaction, regardless of the actual date upon which the Hexokee Transaction is
completed,  Landlord  and  Tenant have agreed that the amount of Additional Rent
which  Tenant shall be obligated to pay for Operating Costs during the first two
(2)  years  of  the  Lease  Term  shall be fixed at $30,000 per year ($2,500 per
                                                     ------            -----
month).  Within  sixty  (60)  days  prior to the commencement of the third (3rd)
year  of  the Lease Term, Landlord shall deliver to Tenant a reasonable estimate
of  the  anticipated  Operating Costs to be borne by Landlord in connection with
Landlord's  (or  Hexokee's  in the case of the Hexokee Common Area Agreement, as
the  case  may  be)  operation  and  maintenance  of  the  Common  Areas for the
forthcoming  calendar  year,  and a corresponding statement of Tenant's Pro-Rata
Project Common Area Share thereof.  Following such estimate, Tenant shall pay to
Landlord, as Additional Rent commencing as set forth above and continuing on the
first  day  of  each  calendar  month thereafter, an amount equal to one-twelfth
(1/12th) of Tenant's Pro-Rata Project Common Area Share of such Operating Costs.
Within  ninety  (90)  days  following  the  end  of  each year of the Lease Term
(following  the 3rd year of the Lease Term), Landlord shall furnish Tenant with:
(i)  a  detailed  itemized  statement  covering  the year of the Lease Term just
expired,  showing the actual Operating Costs incurred by Landlord (or Hexokee in
the case of the Hexokee Common Area Agreement, as the case may be) in connection
with  the  operation and maintenance of the Common Areas for that year, (ii) the
amount  of  Tenant's  Pro-Rata Project Common Area Share of such Operating Costs
for such year, and (iii) the monthly payments which Tenant made during such year
for  such  Operating  Costs ("Landlord's Reconciliation").  If Tenant's Pro-Rata
Project Common Area Share of the actual Operating Costs incurred by Landlord (or
Hexokee  in  the  case of the Hexokee Common Area Agreement, as the case may be)
during  such year exceeds Tenant's prior payments, Tenant shall pay Landlord the
deficiency  within  thirty  (30) days after its receipt of the annual statement.
If the payments made by Tenant during such year exceed Tenant's Pro-Rata Project
Common Area Share of the actual Operating Costs incurred by Landlord (or Hexokee
in  the  case  of  the Hexokee Common Area Agreement, as the case may be) during
such  year,  Landlord  shall  apply the excess payments against payments towards
Operating  Costs next due, or at the Lease end, shall pay Tenant such difference
within  thirty  (30) days of the delivery of the statement.  Upon the expiration
or  earlier  termination  of  the  Lease,  Landlord  shall compute the credit or
deficiency  up  to  the  date  of such expiration or termination, and payment by
Tenant  or  refund  by Landlord, as applicable, shall be made within thirty (30)
days  after  such  expiration  or  termination.

                                      -11-
<PAGE>
Notwithstanding  any  provision  of  this  Lease  to the contrary, following the
Hexokee  Transaction,  should  any  dispute  arise  as  to  the actual amount of
Operating Costs, or as to Tenant's Pro-Rata Project Common Area Share, or at any
other  time  during  the  Lease  Term,  Tenant shall have the right, at Tenant's
expense  and  upon thirty (30) days' prior notice to Landlord, to audit, inspect
and  photocopy all of Landlord's (or Hexokee's in the case of the Hexokee Common
Area  Agreement,  as  the  case  may  be)  pertinent accounting records or other
records  pertaining  to  the Operating Costs incurred with respect to the Common
Areas  of  the  Project  and  the  accounting  records  of  the property manager
pertaining  to  the  same.  If,  after  such audit, inspection and photocopying,
Tenant  continues to dispute the amount of Operating Costs incurred with respect
to  the  Common  Areas  of  the Project or Tenant's Pro-Rata Project Common Area
Share,  and  Tenant  and Landlord are otherwise unable to mutually agree as to a
reconciliation  of  such  dispute,  then  Tenant and Landlord shall collectively
retain  a  mutually  acceptable independent, certified public accounting firm to
audit  and/or review Landlord's records (or Hexokee's records in the case of the
Hexokee  Common  Area  Agreement,  as  the  case may be) to determine the proper
amount  of  Operating  Costs  incurred  with  respect to the Common Areas of the
Project  and  Tenant's Pro-Rata Project Common Area Share thereof.  Landlord and
Tenant  shall  mutually  agree  as to such firm, but if they do not agree within
three  (3) months following Tenant's request for such review or audit, the names
of  the five (5) largest accounting firms in Colorado Springs shall be placed in
a  hat  and the first firm selected at random from the hat by Landlord which has
not  worked  for  either Landlord or Tenant within the past five (5) years shall
conduct the audit.  If such audit or review reveals that Landlord has overstated
the  amount  of Operating Costs incurred with respect to the Common Areas of the
Project or has otherwise overcharged Tenant for Tenant's Pro-Rata Project Common
Area  Share  thereof,  then within five (5) days after the results of such audit
are  made  available  to Landlord, Landlord shall reimburse Tenant the amount of
such  overcharge.  If  the audit reveals that Landlord understated the amount of
Operating Costs incurred with respect to the Common Areas of the Project or that
Tenant was undercharged for Tenant's Pro-Rata Project Common Area Share thereof,
then  within  five (5) days after the results of the audit are made available to
Tenant,  Tenant shall reimburse Landlord the amount of such undercharge.  Tenant
agrees  to  pay  the cost of such audit, provided that if the audit reveals that
Landlord's  determination of Operating Costs incurred with respect to the Common
Areas  of the Project or Tenant's Pro-Rata Project Common Area Share thereof was
in  error  such  that  Tenant's  payment  were  greater than one hundred fifteen
percent  (115%) of the actual amount of Operating Costs incurred with respect to
the  Common  Areas  of  the  Project  or  the actual amount of Tenant's Pro-Rata
Project  Common  Area  Share  thereof,  then Landlord shall pay the cost of such
audit.  Landlord  (or  Hexokee in the case of the Hexokee Common Area Agreement,
as the case may be) shall be required to, and hereby agrees to, maintain records
of  all  such  Operating  Costs incurred with respect to the Common Areas of the

                                      -12-
<PAGE>
Project  at its offices in Colorado Springs, Colorado.  Landlord and Tenant each
agree that, in the event the Hexokee Transfer and Assignment does not occur, and
the  Hexokee Common Area Agreement is entered into in lieu thereof, the terms of
the  Hexokee  Common  Area  Agreement  will  incorporate  all  of  the foregoing
provisions  of  this  Lease  so  as  to  afford  Tenant  the  audit  rights  and
reconciliations  of  Tenant's  Pro-Rata  Project  Common Area Share contemplated
above.

     C.   OPERATING COSTS.  Following  the  Hexokee Transaction, Operating Costs
          ---------------
associated  with Landlord's (or Hexokee's in the case of the Hexokee Common Area
Agreement, as the case may be) operation and maintenance of the Common Areas for
purposes of this Lease shall include all costs and expenses incurred by Landlord
(or  Hexokee  in  the case of the Hexokee Common Area Agreement, as the case may
be)  for  any of the following:  (i) all premiums (or pro-rata portions thereof)
for  liability  insurance  carried  by  Landlord  (or Hexokee in the case of the
Hexokee  Common  Area  Agreement, as the case may be) with respect to the Common
Areas, (ii) all charges for utilities servicing the Common Areas of the Project,
replacing  utility  service  lines  and  the  cost  and expense of operating and
maintaining the monument signs dedicated to the Project and located along Garden
of  the Gods Road, (iii) all costs for maintenance and repairs of the driveways,
alleyways  and common parking areas servicing the Project and all of its tenants
and  users,  including  all  costs  and  expenses  of operating, maintaining and
replacing  driveway  and  parking lot lighting, sweeping and cleaning, patching,
sealing,  resurfacing,  repairing, line painting and striping, and snow, ice and
debris  removal,  (iv)  all costs associated with the landscaped portions of the
Common  Areas,  including  all  costs  and  expenses  of gardening, maintaining,
repairing, replanting and replacing plants, flowers, shrubbery, planters and all
costs  associated with maintenance and repair of irrigation systems, and (v) all
other  costs  and expenses of operating, maintaining the Common Area portions of
the  Project.  Notwithstanding  the  foregoing,  Landlord  hereby  agrees  that
Operating  Costs  for  the Common Area portions of the Project shall in no event
include  any  of the following:  (a) Deductions for depreciation or obsolescence
of  any  of  the  Common Area portions of the Project, or any other improvements
thereto; (b) initial costs associated with completing, fixturing or constructing
any  of the Common Area portions of the Project, (c) costs of replacement of any
major  system  or component of the Common Area portions of the Project which are
of  a  capital nature, including, but not limited to, capital additions, capital
improvements, capital repairs, capital maintenance, capital alterations, capital
replacements,  capital equipment and capital tools, and/or capital redesign, (d)
costs  in  connection  with  services  (including  electricity),  items or other
benefits  of a type which are not standard and which are not available to Tenant
without  specific  charge  therefor, but which are provided to another tenant or
occupant  of  the  Project,  whether  or  not  such  other tenant or occupant is
specifically charged therefor by Landlord (or Hexokee in the case of the Hexokee
Common Area Agreement, as the case may be), and services, items and benefits for
which  Tenant  or  any  other  tenant  or  occupant  of the Project specifically
reimburses  Landlord  (or  Hexokee  in  the  case  of  the  Hexokee  Common Area
Agreement,  as  the  case  may  be)  or  for which Tenant or any other tenant or
occupant  of  the  Project  pays  third  persons,  and all other costs for which
Landlord  (or  Hexokee  in the case of the Hexokee Common Area Agreement, as the
case may be) is compensated through or reimbursed by insurance or other means of
recovery;  (e)  cost  of repairs, replacements or other work occasioned by fire,
windstorm  or other casualty, or the exercise by governmental authorities of the
right of eminent domain, and the costs incurred in connection with upgrading the
Common  Area  portions  of  the  Project to comply with handicap, life, fire and
safety  codes which are either (x) the result of Landlord's (or Hexokee's in the
case  of the Hexokee Common Area Agreement, as the case may be) voluntary and/or
discretionary  policies,  as opposed to a governmentally mandated policy, or (y)
applicable  to codes which were in effect on or prior to the date of this Lease;
(f)  costs  directly  resulting  from  the  negligence  or willful misconduct of
Landlord or Landlord's agents (or Hexokee or Hexokee's agents in the case of the
Hexokee  Common Area Agreement, as the case may be), penalties for late payment,
and all costs or fees relating to the defense of Landlord's (or Hexokee's in the
case  of  the  Hexokee  Common  Area  Agreement, as the case may be) title to or
interest in the Project, or any part thereof; (g) Federal, State or local income
taxes imposed on Landlord's (or Hexokee's in the case of the Hexokee Common Area
Agreement,  as  the  case  may  be)  or the Project's net income, any franchise,
transfer,  inheritance or capital stock tax, and all other such taxes payable by
Landlord  (or  Hexokee  in the case of the Hexokee Common Area Agreement, as the
case  may  be);  (h)  costs  of correcting defects, including any allowances for
same,  in the construction of the Common Area portions of the Project; (i) costs
of  repair,  abatement,  removal  or cleanup of hazardous substances, including,
without  limitation,  all  Hazardous  Materials  (as  defined  herein)  or costs
associated  with  causing  the  Common  Area  portions  of  the Project to be in
compliance  with  Environmental  Regulations (as defined herein); (j) rental and
any  other  expenses,  including  wages,  salaries and benefits, and adjustments
thereto,  for  Landlord's  (or  Hexokee's in the case of the Hexokee Common Area
Agreement,  as  the  case may be) on-site management and/or leasing offices, and
compensation  in  the  form  of  wages, salaries and such other compensation and
benefits, as well as any adjustments thereto, for all employees and personnel of
Landlord  (or  Hexokee  in the case of the Hexokee Common Area Agreement, as the
case may be) above the level of the on-premises manager (provided, however, that
compensation  in  the  form  of  wages, salaries and such other compensation and
benefits  for  Landlord's  on-premises  manager  shall not be excluded), and all
fees,  wages,  salaries  and other compensation for any employee of Landlord (or
Hexokee  in  the case of the Hexokee Common Area Agreement, as the case may be);

                                      -13-
<PAGE>
(k)  payments  of principal, finance charges or interest on debt or amortization
on  any mortgage, deed of trust or other debt, and rental payments (or increases
in  same)  under  any  ground  or  underlying  lease  or  leases,  and any sale,
syndication,  financing or refinancing costs and expenses, including interest on
debt or amortization payments on debt, and rental under any future ground lease;
and (l) any other expense which, under generally accepted accounting principles,
consistently  applied,  would  not  be  considered to be a normal maintenance or
operating  expenses  of  the  Common Area portions of the Project.  Landlord and
Tenant  each  agree  that, in the event the Hexokee Transfer and Assignment does
not  occur,  and  the  Hexokee  Common  Area  Agreement  is entered into in lieu
thereof,  the terms of the Hexokee Common Area Agreement will incorporate all of
the  exclusions  from  Operating  Costs  contemplated  above,  or will otherwise
provide  that  Tenant is not obligated to contribute toward any of the foregoing
exclusions  from  Operating  Costs.

     To the extent not previously  taken into account in  determining  Operating
Costs, Operating Costs shall be reduced by all cash discounts,  trade discounts,
or quantity  discounts  received by Landlord or  Landlord's  managing  agent (or
Hexokee or  Hexokee's  managing  agent in the case of the  Hexokee  Common  Area
Agreement,  as the case may be) in the  purchase  of any  goods,  utilities,  or
serviced in  connection  with the  operation of the Common Area  portions of the
Project.  Landlord (or Hexokee in the case of the Hexokee Common Area Agreement,
as the case may be) shall  attempt to make  payments for goods,  utilities,  and
services in a timely  manner to obtain the  maximum  possible  discount.  In the
calculation of any expenses hereunder, it is understood that no expense shall be
charged more than once.  Landlord (or Hexokee in the case of the Hexokee  Common
Area Agreement,  as the case may be) shall use its best efforts in good faith to
effect an equitable  proration of bills for services rendered to the Common Area
portions of the Project.  Landlord (or Hexokee in the case of the Hexokee Common
Area  Agreement,  as the case  may be)  further  agrees  that  since  one of the
purposes of Operating  Costs is to allow the Landlord (or Hexokee in the case of
the Hexokee Common Area Agreement, as the case may be) to require Tenant and the
other  tenants and users of  properties  within the Project to pay for the costs
attributable to the Common Area portions of the Project, Landlord (or Hexokee in
the case of the Hexokee Common Area Agreement,  as the case may be) agrees that,
(i) Landlord (or Hexokee in the case of the Hexokee  Common Area  Agreement,  as
the case may be) will not collect or be entitled to collect Operating Costs from
all of tenants and other users of the Project in an amount which is in excess of
100% of the Operating Costs for the Common Area portions of the Project actually
incurred  by  Landlord  (or  Hexokee  in the  case of the  Hexokee  Common  Area
Agreement,  as the case may be),  (ii) the Common  Area  portions of the Project
will not be  assessed  for  Operating  Costs in  excess of the  Operating  Costs
actually  paid or  incurred,  and (iii)  Landlord (or Hexokee in the case of the
Hexokee  Common  Area  Agreement,  as the case may be) shall make no profit from
Landlord's  (or Hexokee's in the case of the Hexokee Common Area  Agreement,  as
the case may be)  collections  of Operating  Costs.  In  addition,  Landlord (or
Hexokee in the case of the Hexokee  Common Area  Agreement,  as the case may be)
covenants  to use its good faith  efforts  to take  advantage  of all  available
manufacturers',  suppliers' or  contractors'  warranties in connection  with the
Common Area portions of the Project. Landlord and Tenant each agree that, in the
event the Hexokee Transfer and Assignment does not occur, and the Hexokee Common
Area Agreement is entered into in lieu thereof,  the terms of the Hexokee Common
Area Agreement will incorporate all of the foregoing obligations of Landlord.

                                      -14-
<PAGE>
                                   ARTICLE IV
                              SERVICES AND EXPENSES

     Landlord  covenants  and  agrees,  so  long as the Tenant is not in default
under any of the covenants of this Lease beyond any applicable cure period, that
the  Building, the Leased Premises (including the Expansion Space), the Property
(and the Common Areas of the Project following the Hexokee Transaction) shall be
supplied  with  the  following  services,  systems and equipment, all to a level
which  is  similar  to  other  comparable  office,  manufacturing,  assembly,
distribution  and  warehousing  buildings  in  the  City  of  Colorado  Springs.
Landlord  hereby represents and warrants that:  (i) all of the services, systems
and  equipment  set  forth below and servicing the Building, the Leased Premises
and the Property either currently exist or will exist as of the date of Tenant's
occupancy  of  each of the various portions of the Leased Premises, and (ii) the
following  systems  and  equipment  currently servicing the Building, the Leased
Premises  and  the  Property  are in good condition and proper working order and
function.  The  services,  systems and equipment to be provided to the Building,
the  Leased  Premises,  the  Property  (and  the  Project  following the Hexokee
Transaction)  are  as  follows:

     A.     HVAC  SERVICES.  Heating,  ventilation  and  refrigerated  air
            --------------
conditioning  to  the  Building  and  the  Leased  Premises  in seasonal amounts
sufficient  to  maintain  temperatures within reasonable ranges similar to other
comparable  office,  manufacturing,  assembly,  distribution  and  warehousing
buildings  in  the  City of Colorado Springs.  In connection therewith, Landlord
has  agreed  to  replace, at its sole cost and expense, the approximately 15 "GE
Units"  currently  servicing  the  Building  which  Landlord has determined have
exceeded  their  useful  life,  such  replacement  to  be completed on or before
Landlord's  delivery  of  the  Existing Space on October 1, 2000.  Tenant hereby
                                                 ---------------
acknowledges  that  certain  of  these 15 units will be heating units only.  The
remaining  existing  units will be provided in good working order and condition,
but  will  not  be  replaced.  Landlord  hereby  warrants the good condition and
working  order  and  function  of  all  such systems and equipment servicing the
Building,  the  Leased Premises and the Property for a period of sixty (60) days
following Tenant's occupancy of each portion of the Building, and further agrees
to  pass  on to Tenant, or otherwise assist Tenant in realizing the benefits of,
any  and  all  manufacturers  warranties  which  Landlord  may have or otherwise
receive  in  connection  with  such  rooftop  units.

     B.     WATER  SERVICES.  Water, hot, cold and refrigerated, at those points
            ---------------
of  supply  currently  existing  in  the  Building,  the Leased Premises and the
Property  (and  as  to  be  provided  to  the  Expansion  Space  upon Landlord's
completion  thereof);

     C.     ELECTRICAL  SERVICES.  Electric  current  for  Tenant's  needs  in
            --------------------
connection with its business to those points of supply currently existing in the
Building,  the  Leased Premises and the Property, with currents similar to other
comparable  office,  manufacturing,  assembly,  distribution  and  warehousing
buildings  in  the  City  of  Colorado  Springs;

     D.     COMMON AREA UTILITIES.  Following the Hexokee Transaction, utilities
            ---------------------
to  service  the  Common  Area  portions of the Project in the manner and to the
extent customary for similar projects in the City of Colorado Springs, Colorado.

     E.     INSURANCE  COVERAGES.  Insurance  for  the  Building,  the  Leased
            --------------------
Premises  and  the Property (and following the Hexokee Transaction, the Project)
in  the  amounts  set  forth in Article VII "Insurance" below.  Tenant, however,
                                             ---------
shall  at  its  sole cost and expense, keep all furniture, fixtures decorations,
glass,  improvements and equipment in the Leased Premises insured as required by
Article  VII  "Insurance"  below.
               ---------

     F.     GENERAL  MAINTENANCE.  Following  the  Hexokee  Transaction and with
            --------------------
respect to the Common Area portions of the Project, regular maintenance so as to
keep  in  good  order,  condition  and  repair,  all Common Area portions of the
Project,  including  all  driveway  and  alleyway  areas, all parking areas, all
landscaping  and  all  signage.

                                      -15-
<PAGE>
                                    ARTICLE  V
                      REAL  ESTATE  TAXES  AND  ASSESSMENTS

     Landlord  and  Tenant  each  hereby  agree  that,  inasmuch  as Tenant will
ultimately  occupy 100% of the Building and the Leased Premises, Tenant shall be
responsible, at its sole cost and expense and as Additional Rent, for payment of
all  of  the  real  property taxes, or any taxes levied in lieu thereof on or in
addition  thereto, due to the ownership or operation of the Building, the Leased
Premises  and  the  Property  (but not including any tax levied on the income of
Landlord)  levied,  assessed  or  allocated  (including  any special assessments
created  by  formation of a special improvement district or created in any other
manner)  for  any  period  included in the Lease Term or any extensions thereof.
Tenant  shall pay all such taxes directly to Landlord within thirty (30) days of
Landlord's  presentation to Tenant of tax bills associated with such taxes.  For
the  tax years in which this Lease commences and terminates, and with respect to
Tenant's  phased  occupation  of  the Leased Premises at the commencement of the
Lease  Term  as described above, Tenant's obligations pursuant to this paragraph
shall  be  apportioned  on  a pro-rata and per diem basis in such proportions as
Tenant's  tenancy  of  the  Leased  Premises  bears  to  365  days,  and in such
proportions  as  Tenant's  occupancy  of the Leased Premises bears to the entire
Leased  Premises.  Tenant's pro rata share shall be based upon estimates made by
Landlord  of  projected  taxes  due for the subject calendar year, on a fair and
equitable  basis.  This  paragraph  shall  not be deemed or construed to require
Tenant  to  pay  or  discharge  any  inheritance  or  estate taxes or taxes upon
inheritance  or  right  of  succession which may be levied against any estate or
interest  of  Landlord,  even though such taxes shall  become a lien against the
Building,  the  Leased  Premises or the Property.  In addition to the foregoing,
Tenant  shall  have  the  right  to  appeal  or  contest,  by way of appropriate
proceedings,  the  amount of any taxes payable by Tenant hereunder, and Landlord
hereby agrees to cooperate in good faith with Tenant in connection with any such
appeal  or  contest.

                                    ARTICLE  VI
                                     UTILITIES

     Landlord  and  Tenant  each  hereby  agree  that,  inasmuch  as Tenant will
ultimately  occupy 100% of the Building and the Leased Premises, Tenant shall be
responsible, at its sole cost and expense and as Additional Rent, for payment of
all  utilities  used  and  consumed by the Building, the Leased Premises and the
Property,  including  but  not  limited  to gas, propane, electricity, water and
sewer.  Tenant  shall  pay  the  costs  for  all  such utilities directly to the
utility  companies,  and  Tenant  agrees  to  contract  with utilities providers
directly  and  to  bear  sole  responsibility  for the payment of such utilities
billings  in  its  own  name.  Landlord  hereby represents and warrants that the
Building and the Property are separately metered for all such utilities, thereby
enabling Tenant to pay directly for all such utilities consumed by the Building,
the  Leased  Premises and the Property.  In addition to the foregoing, following
the  Hexokee  Transaction,  Tenant  shall  be obligated to pay Tenant's Pro-Rata
Project  Common  Area Share of utilities provided to the Common Area portions of
the  Project  as  described  above.  Tenant  shall, at all time during the Lease
Term,  keep all such meters and installation equipment servicing the Building in
good  working  order  and  repair  at  Tenant's  sole  cost  and  expense.

     Landlord does not warrant or guarantee the continued availability of any or
all  of  the  utility  services necessary or desirable for the use of the Leased
Premises by Tenant.  In no event shall the interruption, diminution or cessation
of  such  availability  be  construed  as  an actual or constructive eviction of
Tenant,  nor  shall  Tenant be entitled to any abatement of its rent obligations
under  this Lease on account thereof, except to the extent the same results from
Landlord's  negligence,  willful  misconduct  or breach of its obligations under
this Lease.  Notwithstanding the foregoing, Landlord and Tenant have each agreed
that,  in  the  event there is a loss of utility services to the Leased Premises
which  continues  for  an uninterrupted period of one hundred twenty (120) days,
which  loss  of utility services precludes Tenant from operating its business in
the Leased Premises in the manner contemplated by this Lease, and without regard
to  force  majeure  or fault on the part of Landlord, then Tenant shall have the
right  to  terminate this Lease upon written notice to Landlord given within ten
(10) business days following the expiration of such one hundred twenty (120) day
period.  In  the  event  that  a deposit is required by a public or quasi-public
organization  in  order to furnish or agree to furnish any service to the Leased
Premises,  Tenant agrees and covenants to pay such charge or deposit.  Any money
so paid shall not entitle Tenant to an offset or reduction of its rent liability
under  this  Lease,  nor  shall Landlord be obligated to return, repay or credit
Tenant  for  any money so paid, except to the extent Landlord receives a return,
repayment or credit from the public or quasi-public organization collecting such
deposit.

                                      -16-
<PAGE>
     Landlord  reserves  the  right  to stop  the  service  of any or all of the
utilities herein above described upon reasonable  written notice to Tenant when,
in  Landlord's  sole  discretion,  such  stoppage is  necessitated  by reason of
accident, repairs,  inspections,  alterations or improvements,  until any of the
same have been completed.  In such event, Landlord shall not be deemed guilty of
a breach of this Lease,  nor shall  Tenant be entitled to any  abatement  of its
rent  obligations  under  this  Lease on account  thereof.  Notwithstanding  the
foregoing,  Landlord  hereby agrees to provide the forgoing  notice,  and to use
commercially  reasonable  efforts  to  conduct  all such  repairs,  inspections,
alterations  and  improvements,  and to  perform  the same in a manner  so as to
minimize the impact on Tenant,  Tenant's business and Tenant's use of the Leased
Premises.

                                    ARTICLE  VII
                                     INSURANCE

     A.     LANDLORD'S  INSURANCE.  Commencing  with the Lease Commencement Date
            ---------------------
and  continuing  throughout the Lease Term, and any extensions thereof, Landlord
shall  maintain  or  cause to be maintained (i) an "all risk" casualty insurance
policy,  with  an  endorsement  insuring  against  loss of both Minimum Rent and
Additional Rent (including Extended Period of Recovery, if applicable), insuring
the  Building  and all improvements of the Building and the Lease Premises in an
amount  not  less  than  100%  of  their  replacement  value, (ii) comprehensive
liability  insurance  for  the  actions of Landlord and Landlord's Agents, (iii)
comprehensive  general liability insurance covering the Property, and (iv) other
policies  of  insurance  which Landlord or Landlord's mortgagee for the Building
requires  to be kept in force.  Landlord and Tenant each agree that, inasmuch as
Tenant  will  ultimately  occupy  100%  of the Building and the Leased Premises,
Tenant shall be responsible for the payment of all premiums associated with such
insurance,  and  shall reimburse Landlord, as Additional Rent, for the costs for
all  such  insurance  within  thirty  (30)  days of Tenant's receipt of invoices
evidencing  Landlord's  payment  thereof.  For  the  years  in  which this Lease
commences  and terminates, and with respect to Tenant's phased occupation of the
Leased  Premises  at  the  commencement  of  the  Lease Term as described above,
Tenant's  obligations  pursuant  to  this  paragraph  shall  be apportioned on a
pro-rata  and  per  diem  basis  in  such proportions as Tenant's tenancy of the
Leased Premises bears to 365 days, and in such proportions as Tenant's occupancy
of  the  Leased Premises bears to the entire Leased Premises.  Tenant's pro rata
share  of  such  insurance  premiums  during  this  period  shall  be based upon
estimates  made  by  Landlord of insurance premiums due for the subject calendar
year,  on  a  fair  and  equitable  basis.

     In  addition  to the foregoing, following the Hexokee Transaction, Landlord
(or  Hexokee  in  the case of the Hexokee Common Area Agreement, as the case may
be)  shall  maintain  or  caused  to  be maintained:  (i) an "all risk" casualty
insurance policy, insuring the Common Areas of the Project in an amount not less
than 100% of their replacement value, (ii) comprehensive liability insurance for
the  actions  of Landlord and Landlord's Agents with respect to the Common Areas
of  the  Project,  (iii)  comprehensive general liability insurance covering the
Common Areas of the Project, and (ii) other policies of insurance which Landlord
or  Landlord's  mortgagee  (or Hexokee or Hexokee's mortgagee in the case of the
Hexokee  Common  Area Agreement, as the case may be) for the Common Areas of the
Project  requires  to  be  kept  in  force.

     B.     TENANT'S INSURANCE.  Commencing with the Lease Commencement Date and
            ------------------
continuing  throughout  the Lease Term, and any extensions thereof, Tenant shall
maintain  or  cause to be maintained, at its sole cost and expense, (i) fire and
extended  coverage  insurance  insuring  all  alterations  and additions made by
Tenant  to the Leased Premises and all of its fixtures, inventory, furniture and
equipment in an amount not less than the full replacement value thereof with the
broadest  possible  coverage  ("all  risk") on a 100% co-insurance form insuring
against all risks of direct physical loss and excluding only such unusual perils
as  nuclear attack, earth movement, flood and war, (ii) public liability, bodily
injury  and  property  damage  comprehensive insurance coverage insuring against
claims of any and all personal injury, death or damage occurring in or about the
Leased  Premises or the sidewalks adjacent thereto, with a combined single limit
coverage  of  not less than $2,000,000, (iii) business interruption insurance in
amounts  sufficient  to cover perils that may cause the business of Tenant to be
interrupted  and  in  sufficient  amounts to cover Tenants obligations contained
herein  for  a  period  of not less than one year, and (iv) Workers Compensation
Insurance  with  minimum limits as defined by Colorado statutes, as amended from
time to time.  Landlord or Landlord's mortgagee may require reasonable increases
in  the  above-described coverage from time to time, in which event Tenant shall
obtain  the  same  and  pay  the  costs  thereof.

                                      -17-
<PAGE>
     Each  of  the  foregoing  insurance  policies to be carried by Landlord and
Tenant  shall  be  issued  by  an  insurance  company  of  recognized  standing,
authorized  to  do business in the State of Colorado and reasonably satisfactory
to  Landlord.  The policies required to be carried by Tenant shall name Landlord
as  an  additional insured, and shall be payable to Landlord and Tenant as their
interests  may  appear.  In addition, all such policies shall contain waivers of
subrogation  as  set  forth  in  Article XIV "Waiver of Subrogation" hereof.  If
                                              ---------------------
required  by  Landlord,  such  policies  shall  also  contain  a  loss  payable
endorsement  in  favor  of  the  holder of any first mortgage on the Property or
portion  thereof.  All  such  policies  shall  provide  that  no cancellation or
termination  thereof  or  any  material  modification thereof shall be effective
except  on  30  days  prior written notice to Landlord, and, if applicable, said
mortgagee.  Certificates  evidencing  such  insurance  shall  be  delivered  to
Landlord  upon  the  Lease  Commencement  Date  and  each  anniversary  thereof.

     Tenant shall not carry any stock of goods, store any Hazardous Materials in
violation  of  any  Federal, State or local laws, statutes, ordinances, rules or
regulations  pertaining  to the same (hereinafter, "Environmental Regulations"),
or  do  anything  in or about the Leased Premises which would in any way tend to
increase  insurance rates or invalidate any policy on the Leased Premises or the
Building in which the same are located or carried on Landlord's operation of the
Building.  For  purposes  of  this  Lease,  Hazardous  Materials  shall include,
without  limitation,  substances defined as "hazardous substances" or "hazardous
materials"  or  "toxic  substances" in the Comprehensive Environmental Response,
Compensation  and  Liability Act of 1980, as amended, 42 U.S.C. Section 9601, et
seq.  ("Cercla"),  the Hazardous Materials Transportation Act, 49 U.S.C. Section
1801,  et  seq.,  the  Resource Conservation and Recovery Act, 42 U.S.C. Section
6901, et seq. ("RCRA") or any other Federal, State or Local laws or statutes and
in  any  regulations adopted and publications promulgated pursuant to said laws.
If  Landlord  shall  consent  to  such use, which consent must be in writing and
shall  be given in Landlord's sole and absolute discretion, Tenant agrees to pay
as Additional Rent any increase in premiums therefor resulting from the business
carried  on in the Leased Premises by Tenant.  If Tenant installs any electrical
equipment  that  overloads  the power lines to the Building, Tenant shall at its
own  expense make whatever changes are necessary to comply with the requirements
of  insurance  underwriters  and  insurance  rating  bureaus  and  governmental
authorities  having  jurisdiction.

     The  obligations  of  Tenant,  as  contained  in  this Article, shall inure
directly  to Landlord's first mortgagee and shall not be invalidated by any act,
neglect  or  default  of  Landlord,  nor  by  any  foreclosure  or other similar
proceeding,  nor  by  any  change  in title or ownership of the Leased Premises.

                                  ARTICLE VIII
                     MAINTENANCE OF THE BUILDING AND REPAIRS

     A.     LANDLORD'S  MAINTENANCE  AND  REPAIR OBLIGATIONS.  Landlord shall be
            ------------------------------------------------
responsible,  at  its  sole  cost  and  expense,  for maintaining the structural
portions  of the Building, including the structural portions of the roof and the
concrete  slabs,  except to the extent of any damage caused by the negligence or
willful misconduct of Tenant or Tenant's Agents for which the insurance required
to  be  carried by Landlord hereunder does not provide coverage.  Landlord shall
further  be  responsible,  at  its  sole  cost  and  expense, for performing all
required  replacements  of  the heating, venting and air conditioning equipment,
replacements  of  the  roof,  repairs  or  replacement  to  or of the structural
portions  of  the  Building or the roof, repairs or replacements of the concrete
slabs  for  the Building, and all other replacement of any other major system or
component  of  the  Building, the Leased Premises or the Property which are of a
capital  nature,  including,  but  not  limited  to, capital replacements and/or
capital  redesign.  With  the  exception  of  the  foregoing,  and  except as to
Landlord's  warranties  concerning  the  systems  and  equipment  servicing  the
Building,  Landlord  and  Tenant each hereby agree that, inasmuch as Tenant will
ultimately  occupy 100% of the Building and the Leased Premises, Tenant shall be
responsible,  at  its sole cost and expense, for all maintenance of the Building
and  the  Leased  Premises,  all  as  more  particularly  set  forth  below.

     B.     TENANT'S  MAINTENANCE  AND  REPAIR  OBLIGATIONS.  Inasmuch as Tenant
            -----------------------------------------------
will ultimately occupy 100% of the Building, Tenant shall be responsible, at its
sole cost and expense, for keeping, and hereby covenants that it shall keep, the
Building  and the Property, including, without limitation, all parking areas and
landscaped areas located on the Property (but excluding the initial installation
of  the  landscaping  on  the Property around the Building which Landlord hereby
agrees  to  install  at its sole cost and expense), the exterior portions of the
Building  (excluding structural portions of the Building, structural portions of
the roof and the concrete slabs as set forth above), the non-structural portions
of  the  roof,  all  electrical  systems,  plumbing systems and roof top heating
venting  and  air  conditioning equipment, the doors, the windows, the corridors
and all other structures or equipment serving the Building and the Property,  in
good  order,  condition  and  repair.  In  connection with all such maintenance,
Tenant  may  enter  into:  (i) a landscape maintenance contract with a reputable
service  company, (ii) an HVAC service and maintenance contract with a reputable
service  company,  (iii)  contracts  for the cleaning of exterior windows in the
Building,  and (iv) contracts for sweeping of and removal of snow from sidewalks
and  parking  areas  adjacent  to  the  Building  and  on  the  Property.

                                      -18-
<PAGE>
     In addition to  maintenance  and repair of the Building  and the  Property,
Tenant shall, at its sole cost and expense,  maintain,  replace, repair and keep
all parts of the interior of the Leased  Premises  (including but not limited to
interior wall  surfaces,  doors,  door  hardware,  interior  plumbing  fixtures,
electrical  wiring and  equipment,  and mechanical  equipment  within the Leased
Premises,,  specialty  equipment  made  available  to  Tenant)  in  good  order,
operating condition and repair.  Tenant shall also keep the Leased Premises in a
clean, sanitary and safe condition in accordance with all directions,  rules and
regulations of any health officers, building inspectors or other proper officers
of the  governmental  agencies  having  jurisdiction,  and shall  dispose of all
normal  trash  and  waste  materials  in  outside  trash   containers  and  make
appropriate  arrangements  with  trash  cartage  services  to have such  outside
containers  dumped  on a  regular  basis.  Tenant  agrees  to  comply  with  all
Environmental  Regulations  governing  the handling and disposal of any approved
Hazardous  Materials  that Tenant may use on the Leased  Premises.  Tenant shall
flatten  all  boxes  for  dumping  of  trash.   Tenant  shall  comply  with  all
requirements of laws, ordinances and other rules and regulations that affect the
Leased  Premises,  and shall cause no injury to the Building or Leased Premises.
In addition, Tenant shall, at its own cost and expense, replace any light bulbs,
frames,  ballasts,  fixtures and accessory  parts thereof on the Leased Premises
that may be broken or damaged  during the Lease Term.  At the  expiration of the
Lease Term,  Tenant shall  surrender the Leased Premises broom clean and in good
order and condition, reasonable wear and tear excepted.

C.     LANDLORD'S REPRESENTATIONS AND WARRANTIES.  Notwithstanding the foregoing
       -----------------------------------------
or  any other provision of this Lease to the contrary, Landlord hereby makes the
following  representations and warranties, each of which are true and correct as
of  the  date  of  this  Lease:

     (i)  Landlord  represents  and  warrants  that,  to the best of  Landlord's
          actual  knowledge,  the Project,  the Building and the Leased Premises
          are in full  compliance  with all  Federal,  State or local  statutes,
          ordinances,  regulations,  building  codes  and other  life,  fire and
          safety codes or other laws,  rules or  regulations in effect as of the
          date of this Lease,  and  Landlord  covenants to maintain the Project,
          the Building and the Leased Premises  (exclusive of Tenant's  interior
          improvements and personal property) in compliance with the same during
          the Lease Term;

     (ii) Landlord  represents  and warrants  that the Building and the Property
          are subject  only to (a) the  encumbrances  set forth in that  certain
          Owner's Policy of Title  Insurance  issued by Lawyers Title  Insurance
          Corporation  dated  December 16, 1998 under Policy No.  136-01-498812,
          including  that certain Deed of Trust from Cherokee  Equities,  LLC to
          the Public  Trustee for the use of Butler Real Estate,  Inc. to secure
          $2,800,000  dated December 14, 1998 and recorded  December 16, 1998 at
          Reception No. 98185887 (the "Deed of Trust"), in connection with which
          Deed  of  Trust  Landlord  covenants  to use  commercially  reasonable
          efforts to obtain an appropriate  Subordination,  Non-Disturbance  and
          Attornment  Agreement  for in favor of Tenant  promptly  following the
          parties' execution of this Lease;

     (iii)Landlord  hereby  represents  and  warrants  that:  (i) to the best of
          Landlord's  actual  knowledge,  [and with the exception of the Hewlett
          Packard property and possible water contamination previously disclosed
          to Tenant],  the Project,  the Building and the Leased Premises do not
          currently  contain  any  Hazardous   Materials  in  violation  of  any
          Environmental Regulations,  including, without limitation, the soil or
          ground  water,  and (ii)  Landlord  has  received  no  notice or other
          information concerning violations of any Environmental  Regulations or
          the presence of Hazardous  Materials on any of the properties adjacent
          to or in the  immediate  vicinity of the Project,  the Building or the
          Leased Premises;

                                      -19-
<PAGE>
          (iv) Landlord hereby  represents and warrants that: (i) Hexokee is the
     owner of Lot 4 and Lot 5 of the Kaman  Subdivision,  and that the  Property
     currently has, by way of permanent, non-exclusive easements or other rights
     of record, permanent and irrevocable rights of access over and across Lot 5
     and Lot 3 of the Kaman Subdivision to publicly dedicated streets (including
     Garden of the Gods Road and Centennial Boulevard),  which access rights are
     irrevocable  and cannot be terminated or otherwise  eliminated  without the
     prior  written  consent of  Landlord,  all for  purposes of  providing  the
     Property with access to publicly dedicated streets;

          (v)  Landlord  hereby  represents  and  warrants  that  all  requisite
     consents to  Landlord's  execution of this Lease  required by any lender of
     Landlord have been fully obtained, and that no other party has any right to
     consent to or  otherwise  object to  Landlord's  execution of this Lease or
     encumbrance  of the Property with the terms,  covenants  and  conditions of
     this Lease; and

          (vi) Landlord hereby  represents and warrants that all prior leases of
     the  Property,  the Building and the Leased  Premises have been forever and
     irrevocably terminated, and are of no further force or effect, and that the
     Property,  the Building and the Leased  Premises are, as of the date of the
     parties'  execution  of  this  Lease,  unencumbered  by any  other  party's
     leasehold  rights,  or any other  rights  except as  provided  in item (ii)
     above.

     Landlord shall protect, defend, indemnify and hold Tenant harmless from and
against  any  and  all  losses,  costs (including reasonable attorneys' fees and
costs),  liabilities  and  claims  arising from a breach of any of the foregoing
representations  and  warranties.  For  purposes  of  the foregoing, the "actual
knowledge"  of Landlord shall be deemed to mean the actual knowledge of David P.
Phillips  and  Link  Jackson.

                                    ARTICLE  IX
                        PROPERTY  AND  COMMON  AREA  PARKING

     Tenant  shall have the right to the non-exclusive use of 3.5 parking spaces
per  thousand rentable square feet of the Leased Premises in those parking areas
located on the Property, and following the Hexokee Transaction, on those parking
areas  located  on  the  Project  which  have  been designated as Common Area by
Landlord.  Landlord  hereby  represents  and  warrants  that:  (i)  it  has  not
previously, and will not during the Lease Term, over allocate the parking spaces
in  the parking areas on the Property (or within the Common Areas of the Project
following  the  Hexokee Transaction) to an extent where there are not sufficient
remaining  parking  spaces  to  afford  Tenant  the use of the number of parking
spaces  allocated  above,  and (ii) the parking areas available for the Building
(and  within  the Common Areas of the Project following the Hexokee Transaction)
are  currently  in  compliance  with  all  Federal, State and Local governmental
requirements, including, without limitation, the provision of an adequate number
of handicapped parking spaces, and will remain in compliance, at Landlord's sole
cost  and expense, during the Lease Term.  Landlord hereby further covenants to,
at  all  time during the Lease Term, maintain the parking ratios and the parking
areas  on the Property (and within the Common Areas of the Project following the
Hexokee  Transaction)  in  compliance  with  all  such governmental requirements
applicable  to the Building.  Landlord shall at all times use good faith efforts
to  enforce  the parking requirements for the parking areas on the Property (and
within  the  Common Areas of the Project following the Hexokee Transaction), and
to  provide  and enforce Tenant's parking rights described herein.  Landlord and
Tenant  each  agree  that, in the event the Hexokee Transfer and Assignment does
not  occur,  and  the  Hexokee  Common  Area  Agreement  is entered into in lieu
thereof,  the terms of the Hexokee Common Area Agreement will incorporate all of
the  foregoing  provisions  of  this Lease so as to afford Tenant the use of the
Common  Areas  of  the  Project  as  described  above.

                                    ARTICLE  X
                    QUIET  ENJOYMENT;  CARE  OF  LEASED  PREMISES

     Landlord  warrants  that,  upon  payment  of  the required Minimum Rent and
Additional  Rent, and subject to the terms, conditions, covenants and agreements
contained in this Lease, Tenant shall have quiet enjoyment and possession of the
Leased Premises during the full Lease Term.  Tenant agrees to abide by the Rules
and  Regulations adopted by Landlord with regard to its occupancy of  the Leased
Premises,  and  to  abide  by  the  reasonable  rules and regulations adopted by
Landlord  with  respect  to  the  use  of the Common Areas following the Hexokee

                                      -20-
<PAGE>
Transaction.  Following  the  Hexokee  Transaction,  Landlord (or Hexokee in the
case  of  the  Hexokee Common Area Agreement, as the case may be) agrees that it
will  use  its  best  efforts  to consistently enforce the rules and regulations
applicable  to  the  Project against all tenants and other users of the Project.
Tenant  agrees  not to commit any waste upon the Leased Premises or overload the
floors  thereof,  to  keep  the  Leased Premises well-lighted, and in a neat and
clean condition, and not to conduct any activities other than those permitted by
Article  XII  "Use of Leased Premises" thereon without the prior written consent
               ----------------------
of  Landlord.

                                    ARTICLE  XI
                              SIGNS  AND  ADVERTISING

     A.     BUILDING  AND  PROPERTY SIGNAGE.  Landlord hereby agrees that Tenant
            -------------------------------
shall  have  the  right to have its presence in the Building and on the Property
evidenced  by a backlit eyebrow sign to be located at the front archway entry to
the Building, which sign shall be installed and maintained at Tenant's sole cost
and  expense.  Landlord  and  Tenant  each  further  agree  that Tenant shall be
entitled  to  such  other  signage as Landlord and Tenant shall reasonably agree
upon  to  be  located  at  other  areas of the Building and the Property, all in
Landlord's  and  Tenant's  respective reasonable discretions; provided, however,
that  no  additional signs of any type shall be erected, placed or painted on or
about  the  Building  or  the Property without Landlord's prior written consent.
All  such  signage  shall  be  constructed  and  installed  in  conformance with
Landlord's reasonable sign criteria for the Building and the Project, as adopted
by  Landlord  from time to time.  All such additional signage shall be installed
and  maintained  at Tenant's sole cost and expense.  Tenant shall have the right
to  install  interior  signage  within  the  Building and the Leased Premises at
Tenant's  sole  cost  and  expense  and  in  Tenant's sole discretion; provided,
however,  that  Tenant  shall  not  erect  or  install  any  type of sign on the
Building,  any  exterior  window  or  door signs, any paper signs or advertising
signs  painted  on  windows, or other types of signs, placards, or window blinds
visible  from  the outside of the Leased Premises, without first having obtained
the  prior written consent and  approval of Landlord, which consent shall not be
unreasonably  withheld,  conditioned  or  delayed.

     B. MONUMENT AND COMMON AREA SIGNAGE. In addition to Tenant's signage rights
        --------------------------------
with  respect  to  the  Building  and the Property, Landlord hereby agrees that,
following the Hexokee Transaction, Tenant shall be entitled to prominent signage
on  the  existing monument sign for the Project located near the entrance to the
Project  on  Garden of the Gods Road (the "Monument Sign").  Subject to approval
by  all  applicable authorities, Landlord (or Hexokee in the case of the Hexokee
Common  Area Agreement, as the case may be) hereby agrees that the Monument Sign
shall  be  improved  and expanded, at Landlord's sole cost and expense, so as to
enhance  its  prominence, all in compliance with the Colorado Springs City Code,
such  that the Monument Sign:  (i) continues to front on Garden of the Gods Road
near the entrance to the Project, (ii) will be expanded and improved so as to be
generally  consistent  with  the appearance of the buildings within the Project,
and (iii) will be double sided and backlit.  Landlord (or Hexokee in the case of
the  Hexokee  Common  Area  Agreement,  as  the  case may be) shall complete the
improvements  and expansions of the Monument Sign as soon as reasonably possible
following  completion  of  the  Hexokee Transaction, and thereafter Tenant shall
have  the  right  to  install,  at  Tenant's sole cost and expense, its name and
corporate logo in a prominent location on the Monument Sign.  With the exception
of  Tenant's right to prominent space on the Monument Sign, Tenant hereby agrees
that  no additional signs of any type or description shall be erected, placed or
painted  in  or  about  the  Common  Areas,  except those signs submitted to and
approved by Landlord in writing.  All such additional signs, if any, shall be in
conformance  with  Landlord's  reasonable  sign  criteria  established  for  the
Project.  Landlord and Tenant each agree that, in the event the Hexokee Transfer
and  Assignment does not occur, and the Hexokee Common Area Agreement is entered
into  in  lieu  thereof,  the  terms  of  the Hexokee Common Area Agreement will
incorporate all of the foregoing provisions of this Lease so as to afford Tenant
the  use  of  the  Common  Area  signage  contemplated  above.

                                      -21-
<PAGE>
                                    ARTICLE  XII
                               USE  OF  LEASED  PREMISES

     Tenant  shall  have  the  right  to  use and occupy the Leased Premises for
office,  manufacturing,  assembly,  distribution and warehousing activities, and
for all other activities permitted by applicable laws, and for no other purposes
whatsoever.

                                    ARTICLE  XIII
                            ALTERATIONS  AND  ADDITIONS

     Tenant shall not, under any circumstances, make alterations or additions to
the  exterior of the Building without the written consent of Landlord.  With the
express  exception  of alterations or additions costing no more than $10,000.00,
                                                                      ---------
Tenant shall make no alterations or additions to the interior of the Building or
the  Leased  Premises, including equipment or appliances installed in connection
with  the transmission or delivery of the utilities, without first delivering to
Landlord  the  plans  and  specifications  therefor, and without first procuring
Landlord's  prior  written  consent,  which  consent  shall  not be unreasonably
withheld,  conditioned  or  delayed.  Tenant  shall  promptly  pay for the costs
associated  with any such alterations or additions, and shall indemnify Landlord
against  liens,  costs,  damages and expenses incurred by Landlord in connection
therewith,  including  any  reasonable  attorneys  fees incurred by Landlord, if
Landlord  shall  be  joined  in  any  action  or proceeding involving such work.
Landlord  may,  at  its  option, pay sums due in order to release such liens, in
which  event  any such sums paid by Landlord shall be due to Landlord by Tenant,
as  Additional  Rent, upon demand.  Under no circumstances shall Tenant commence
any such work until Landlord has been provided with certificates evidencing that
all  the  contractors and subcontractors performing such work have in full force
and  effect adequate workmen's compensation insurance as required by the laws of
the  State  of  Colorado,  public  liability and builders risk insurance in such
amounts  and according to terms satisfactory to Landlord.  Landlord shall at all
times  have  the  right to post or keep posted on the Leased Premises, or in the
immediate  vicinity  thereof,  any  notices  of  non-responsibility  for  any
construction,  alteration or repair of the Leased Premises by Tenant, and Tenant
hereby  agrees  to  give  Landlord at least ten (10) business days prior written
notice  of  Tenant's  plans  to  commence  such work so as to enable Landlord an
opportunity  to  post  such  notices.

     All alterations, additions, improvements and fixtures, including but not by
way  of  limitation,  lighting  fixtures, ducts, controls, diffusers, filters or
other  equipment  for  distribution  of  heating and cooling, and other personal
property  which  may  be made or installed by, for and on behalf of Tenant, upon
the  Leased  Premises,  and  which  are  not  Tenant's trade fixtures and/or not
otherwise permanently attached to the floors, walls, or ceilings so as to become
fixtures, shall become the property of Landlord at the time of installation, and
shall  remain  upon  and  be surrendered with the Leased Premises at the time of
termination of this Lease as a part of the Leased Premises, without disturbance,
molestation  or  injury.  Any  tile,  linoleum  or  floor  covering  of  similar
character  which may be cemented or otherwise adhesively affixed to the floor of
the Leased Premises shall be and become the property of Landlord absolutely upon
installation.  During  the  Lease  Term,  Tenant  shall not remove or damage the
above  described  items  and  fixtures  without the written consent of Landlord.

                                      -22-
<PAGE>
                                    ARTICLE  XIV
                             WAIVER  OF  SUBROGATION

     Anything in this Lease to the contrary notwithstanding, Landlord and Tenant
each  hereby  waive  and  release  each  other  of and from any and all right of
recovery,  claim, action or cause of action, against each other, their officers,
directors,  shareholders,  partners,  joint  venturers,  employees,  agents,
customers, invitees or business visitors, for any loss or damage to such waiving
party  that  may occur or arise from any cause covered by any insurance required
to  be  carried  by  such  party pursuant to this Lease, or covered by any other
property  or other insurance actually carried by such party to the extent of the
limits  of  such policy, whether or not such recovery, claim, action or cause of
action  was  caused  by  or resulted from the neglect of the other party, and no
party  shall have any liability to the other or to any insurer of the other for,
or in respect of, such recovery, claim, action or cause of action.  Landlord and
Tenant agree immediately to give their respective insurance companies which have
issued  policies  of insurance written notice of the terms of the mutual waivers
contained  in  this  Article  XIV,  and  further agree to cause their respective
insurers  to  issue  appropriate waiver of subrogation rights endorsements to or
provisions  in  all  such  insurance policies to prevent the invalidation of the
insurance  coverages  by  reason  of  the  mutual  waivers.

                                      -23-
<PAGE>
                                    ARTICLE  XV
                  DESTRUCTION  OF  OR  DAMAGE  TO  LEASED  PREMISES

     In  case  the  Leased Premises or the Building in which the Leased Premises
are  situated  shall  be  partially  or totally destroyed by fire or other peril
required  to  be  insured by the policies of insurance required to be carried by
Landlord  and  Tenant pursuant to Article VII "Insurance" hereof so as to become
                                               ---------
partially  or  totally  untenantable,  the same shall be repaired as speedily as
possible  at  the  sole cost and expense of Landlord, to the extent of insurance
proceeds  available,  unless:  (i)  Landlord  or Tenant shall elect to terminate
this  Lease  as  provided  below; or (ii) the remainder of the Lease Term at the
time  of  such  damage  or  destruction  is  less than 24 months, in which event
Landlord  shall  not  be required to rebuild if Tenant fails to exercise (within
thirty  (30)  days  following  notice from Landlord of demand to do so) the next
option  to  extend  the  Lease  Term  which  may  be  available,  if  any.

     In  case  the  Leased Premises or the Building in which the Leased Premises
are situated shall be destroyed or so damaged by fire or other peril required to
be  insured  by the policies of insurance required to be carried by Landlord and
Tenant  pursuant to Article VII "Insurance" hereof so as to render more than 33%
                                 ---------
of  the  Leased  Premises  or 33% of the said Building untenantable, Landlord or
Tenant  may,  at  their  respective election to be exercised in their respective
sole and absolute discretions by notice given to the other not more than 30 days
after  the  occurrence  of  the damage, terminate this Lease (provided, however,
that  such right to terminate shall not apply for Tenant's benefit to the extent
such  damage or destruction is the result of Tenant's negligence).  In the event
neither  Landlord  or  Tenant  elects  to  so terminate, then Landlord shall, as
speedily  as  possible  and  at  its  sole  cost and expense, repair, rebuild or
restore  any  such damage suffered in the Building or the Leased Premises as set
forth  above.  The foregoing notwithstanding, in the event Landlord is unable to
complete such repair, rebuild or restoration, without regard to force majeure or
fault  on  the  part of Landlord, within one-hundred twenty (120) days following
the date of such damage or destruction, then Tenant shall have the right, in its
sole  and  absolute  discretion,  to terminate this Lease upon written notice to
Landlord.

     In  case  of  casualty  to  the  Leased  Premises  resulting  in  damage or
destruction  which  casualty  is  not  insured  against  under  the  policies of
insurance  required to be carried by Landlord and Tenant pursuant to Article VII
"Insurance"  hereof,  Landlord shall be under no obligation to restore, replace,
 ---------
or  rebuild  the Leased Premises, and if such damage or destruction is material,
then  this Lease shall be deemed terminated and of no further force or effect as
of  the  date  of such casualty, unless Landlord elects in its sole and absolute
discretion  to  restore,  repair, replace and rebuild the Leased Premises and so
notifies  Tenant in writing within thirty (30) days after such casualty.  In the
event  Landlord  so  elects  to  restore, repair, replace and rebuild the Leased
Premises,  then  provided  that  such  restoration,  repair,  replacement  and
rebuilding  is completed within one-hundred twenty (120) days following the date
of  such  damage  or  destruction,  this  Lease shall continue in full force and
effect  during  the  period  of  such  restoration,  repairing,  replacing  or
rebuilding.  In  the  event  Landlord  is  unable  to complete such restoration,
repair,  replacement  and  rebuilding  within  one-hundred  twenty  (120)  days
following  the  date  of  such damage or destruction, then Tenant shall have the
right, in its sole and absolute discretion, to terminate this Lease upon written
notice  to  Landlord.

     If such damage or destruction as described in this Article occurs, and this
Lease  is  not so terminated by Landlord or Tenant as set forth above, then this
Lease  shall  remain  in  full  force  and  effect,  and  the parties waive  the
provisions  of  any law to the contrary.  Tenant shall, in the event of any such
damage  or destruction, unless the Lease shall be terminated as provided in this
Article,  forthwith  replace or fully repair all exterior signs, trade fixtures,
equipment, display cases and other installations originally installed by Tenant,
to  the  extent  of insurance proceeds available.  Except as otherwise set forth
herein, Landlord shall have no interest in the proceeds of any insurance carried
by  Tenant,  and  Tenant shall have no interest in the proceeds of any insurance
carried  by  Landlord.  In the event of any such casualty, Tenant's Minimum Rent
and  Additional  Rent  obligations  under  this  Lease  shall abate in that same
proportion  as the number of rentable square feet rendered untenantable bears to
the total number of rentable square feet in the Leased  Premises.  Tenant agrees
during  any  period  of  reconstruction,  restoration  or  repair  of the Leased
Premises and/or of the Building to continue the operation of its business in the
Leased Premises to the extent reasonably practicable from the standpoint of good
business.

                                      -24-
<PAGE>
                                    ARTICLE  XVI
                                  EMINENT  DOMAIN

     If  the  whole  of  the  Leased  Premises shall be acquired or condemned by
eminent  domain  for  any public or quasi-public use or  purpose, then the Lease
Term  shall  cease  and  terminate  as  of  the  date  of  title vesting in such
proceeding,  all  rent  shall  be paid up to that date, and Tenant shall have no
claim  against  Landlord  for  the  value  of  any  unexpired  Lease  Term.

     If  the  whole  of  the parking areas for the Property shall be acquired or
condemned  by eminent domain for any public or quasi-public use or purpose, then
the Lease Term shall cease and terminate as of the date of title vesting in such
proceeding,  unless Landlord, at its own expense, should elect to take immediate
steps  to provide other parking facilities within a reasonable distance from the
Building and reasonably acceptable to Tenant so as to allow parking space ratios
between the parking areas and the gross area of the buildings on the Property to
be sufficient to satisfy Tenant and applicable governmental authorities.  In the
event that Landlord shall provide such other parking facilities, then this Lease
shall  continue  in  full  force  and  effect.

     If  a part of the Leased Premises shall be acquired or condemned by eminent
domain for any public or quasi-public use or purpose, and in the event that such
partial  taking  shall  be  so  extensive  that  Tenant is unable to continue to
operate  its business in the remainder of the Leased Premises, then for a period
of thirty (30) days following such taking, Tenant shall have the right to either
terminate this Lease and declare the same null and void by giving written notice
thereof  to  Landlord  or,  alternatively,  to continue in the possession of the
remainder  of  the  Leased Premises under the terms herein provided, except that
the Minimum Rent and Tenant's Pro-Rata Share shall be reduced in such proportion
as  the  nature, value and extent of the part so taken bears to the whole of the
Leased  Premises.

     If  a  part  of  the  parking  area  of  the Property should be acquired or
condemned  by  eminent  domain for any public or quasi-public use or purpose, no
rights  under  this Lease shall be  affected, so long as the remaining number of
parking  spaces  satisfy  the requirements of Tenant and applicable governmental
authorities.  If the remaining number of parking spaces do not so conform as set
forth  above,  or  if  ingress  or egress to and from the Building or the Leased
Premises  is  materially impaired, Landlord may, at its election, take immediate
steps  to  provide  substitute additional parking facilities within a reasonable
distance  from  the  Building  and  acceptable to Tenant, to allow parking space
ratios  sufficient  to  satisfy  applicable  governmental  authorities.

     In  the  event  that  Tenant  shall terminate this Lease as provided herein
above,  such termination shall be as of the date of Tenant's written notice (but
rent  shall be due until Tenant's  surrender of the Leased Premises), and Tenant
shall  have no claim against Landlord for the value of the unexpired Lease Term,
or  for  damages  of  any  kind.
      In  the  event of a partial taking which is not extensive enough to render
the  Leased  Premises  unsuitable  for  the  business of Tenant as determined by
Tenant  and  as  set  forth  above,  then Landlord shall as speedily as possible
restore  the  Leased  Premises to a condition comparable to its condition at the
time  of  such taking, less the portion lost in the taking, and this Lease shall
continue  in  full  force  and  effect except that the Minimum Rent and Tenant's
Pro-Rata  Share  shall  be  reduced  in  the  manner  provided  herein  above.

     As  regards  any  obligations  of Landlord described in this Article, in no
event  shall  Landlord  be  required  to spend an amount in excess of the amount
available  to  Landlord  from  the  award for any part of the Leased Premises or
parking  area  taken.

     In  the  event of any condemnation or taking as aforesaid, whether in whole
or  in part, Tenant shall not be entitled to any part of the award paid for such
condemnation,  and Landlord shall  receive the full amount of such award, Tenant
hereby  expressly  waiving any right or claim to any part thereof, including but
not  limited  to,  all  damages  as compensation for diminution in value of  the
leasehold,  reversion,  and  fee.  Although  all  damages  in  the  event of any
condemnation or taking are to belong to Landlord, Tenant shall have the right to
claim  and  recover  from  the condemning authority, but not from Landlord, such
compensation  as  may be separately awarded or recoverable by Tenant in Tenant's
own  right  on  account  of any and all damage to Tenant's business by reason of
condemnation and for or on account of any cost or loss  which Tenant might incur
in  removing  Tenant's  merchandise, furniture, fixtures, leasehold improvements
and  equipment.

                                      -25-
<PAGE>
                                    ARTICLE  XVII
                                   INDEMNIFICATION

     Except  as  concerns  losses  paid  by  insurance  for  which Landlord has,
pursuant  to  Article  XIV  above,  waived  and  hereby  does waive the right of
subrogation,  Tenant  shall  and hereby does protect, defend, indemnify and save
Landlord  harmless  from  and  against  any and all liability for damages to any
person  or  any  property in or upon the Leased Premises, including the personal
property of Tenant and Tenant's Agents, and from and against any and all losses,
costs, damages, liabilities or expenses (including reasonable attorneys fees) to
the  extent  arising  out  of  or  in  any  way related to any accident or other
occurrence due directly or indirectly to Tenant's or Tenant's Agents' negligence
or  willful  misconduct, or Tenant's breach of its obligations under this Lease.
Except  as  concerns  losses paid by insurance for which Tenant has, pursuant to
Article  XIV  above,  waived  and  hereby  does  waive the right of subrogation,
Landlord  shall  and  hereby  does  protect,  defend,  indemnify and save Tenant
harmless from and against any and all liability for damages to any person or any
property  in  or  upon  the  Leased Premises, including the personal property of
Landlord  and Landlord's Agents, and from and against any and all losses, costs,
damages,  liabilities  or  expenses (including reasonable attorneys fees) to the
extent  arising out of or in any way related to any accident or other occurrence
due  directly  or  indirectly  to Landlord's or Landlord's Agents' negligence or
willful  misconduct,  or  Landlord's breach of its obligations under this Lease.

                                    ARTICLE  XVIII
                            ASSIGNMENT  AND  SUBLETTING

     Tenant  shall not assign, sell, pledge, mortgage, encumber or in any manner
transfer  this  Lease or any interest therein, nor sublet the Leased Premises or
any part or parts thereof, nor permit occupancy by anyone with, through or under
it,  nor  transfer all or substantially all of Tenant's assets without the prior
written  consent  of Landlord, which consent shall not be unreasonably withheld,
conditioned  or delayed.  Tenant shall pay to Landlord a reasonable fee equal to
the  costs  expended by Landlord to compensate Landlord for the time and expense
of reviewing any request and documentation regarding assignment or subletting up
to  a  maximum amount of $500.00.  Landlord shall have thirty (30) days from the
date  of Landlord's receipt of Tenant's written request for consent, accompanied
by  a  description  of  the  proposed  assignee,  a  description of the proposed
assignee's  business experience and the most recent financial statements for the
proposed  assignee,  within which to determine whether or not Landlord's consent
shall  be  granted.  Landlord  may  reasonably  withhold its consent to any such
assignment,  letting  or  subletting,  if  the  same  would result in any of the
following:

     A.     Use  of  the  Leased  Premises by any party, business, or lessee who
proposes  to conduct a business therein which is not in conformance with the use
of the Leased Premises required pursuant to Article XII "Use of Leased Premises"
                                                         ----------------------
hereof;

     B.     Occupation  of the Leased Premises by any party, business, or lessee
who  is  then  a  lessee  of  the Building, so long as Landlord has or will have
during  the  ensuing  six  (6)  months, suitable space for rent in the Building;

     C.     Occupation  of  the  Leased  Premises  by  a  party  whose financial
condition  and credit rating is not equal to or better than that of Tenant as of
the  Lease  Commencement  Date  (as reasonably determined by Landlord), or whose
credit  rating  is  not  reasonably satisfactory to any lender of Landlord which
holds a security interest in the Property, or which is unable to comply with the
Letter  of  Credit  requirements  of  this  Lease  or  otherwise  able  to  post
substantially  similar  security  as  required  of  Tenant  hereunder;  or

     D.     Occupation  of the Leased Premises by a party whose business is of a
character  which  does  not,  in Landlord's reasonable opinion, comport with the
character  of  the Building or the Project, or occupation of the Leased Premises
by  a  party which is not reasonably acceptable to any lender of Landlord  which
holds  a  security  interest  in  the  Property.

                                      -26-
<PAGE>
     Any  sublease  of  the Leased Premises executed by Tenant shall incorporate
this Lease (the "Underlying Lease") in its entirety and be subject to its terms.
The  sublease  shall  also  require  the  sublessee  to  attorn  to  Landlord at
Landlord's  option  in  the  Event  of  Default by Tenant under the terms of the
Underlying Lease, and Tenant does hereby grant Landlord the irrevocable power of
attorney  to effect the same.  Consent by Landlord to one or more assignments of
this  Lease  or  to  one  or  more  sublettings of the Leased Premises shall not
operate  as a waiver of Landlord's rights under this Article as to any guarantor
of  Tenant of any of its obligations under this Lease, nor be construed or taken
as  a  waiver  of  any  Landlord's  rights  or  remedies  under  this  Lease.

     In  the  event  Landlord  allows assignment or subletting hereunder, Tenant
shall  not  be  released from any obligations under this Lease, unless otherwise
expressly  provided  by  Landlord, and Tenant hereby agrees to remain liable for
all  Lease  obligations.  Neither  the  assignee  of Tenant nor the sublessee of
Tenant  shall have any option to extend the Lease Term, notwithstanding anything
contained  in  this Lease to the contrary, such options to extend the Lease Term
being  personal  to  Tenant  only.  No  interest in this Lease shall pass to any
trustee  or  receiver in bankruptcy, to any estate of Tenant, to any assignee of
Tenant  for  the benefit of creditors, or to any other party by operation of law
or otherwise without Landlord's consent.  No consent to assignment or subletting
shall  be  granted  if  an Event of Default by Tenant is then pending.  Landlord
shall  be  entitled  to  receive fifty percent (50%) of all increases in Minimum
Rents  paid  by  any  assignee or sublessee of Tenant, after deduction of all of
Tenant's  costs  of  assigning  or  subletting  the  Leased  Premises.

                                    ARTICLE  XIX
                           LANDLORD'S  SALE  OR  TRANSFER

     In  the  event  Landlord should sell or transfer the Property, the Building
and  the  Leased  Premises,  including  sales  by  foreclosure or a deed in lieu
thereof,  and  conditioned  upon  the  express  assumption  of all of Landlord's
obligations  hereunder  by  the  transferee  under  any  such  sale or transfer,
Landlord  shall  be,  and is, entirely freed and relieved of all liability under
any  and  all of its covenants and obligations contained in or derived from this
Lease  arising  out  of  any act or omission occurring after the consummation of
sale  or  lease;  and the transferee of the Property shall, during the period of
its ownership or Lease Term, be deemed without any further agreement between the
parties to have assumed and agreed to carry out any and all of the covenants and
obligations  of  Landlord  under  this  Lease.  All  subsequent  purchasers  or
landlords  shall, on the same conditions, similarly be freed and relieved of all
liability  hereunder  subsequent  to the date of such sale or lease by them.  In
the  event  of  any  such  sale  or  lease,  and  subject  to  Landlord's
successor-in-interest  agreeing  to  be  bound  by  the  terms of this Lease and
assuming  Landlord's  obligations  as  Landlord  hereunder  (including,  without
limitation,  all  of  the  obligations  contemplated with respect to the Hexokee
Transfer and Assignment in the event such transferee is the owner of the balance
of  the  Project),  Tenant  agrees  to attorn to and become Tenant of Landlord's
successor-in-interest.

                                    ARTICLE  XX
                                      DEFAULT

     This  Lease  is  made on the condition also that, if any one or more of the
following  events  (herein referred to  as an "Event of  Default") shall happen,
Tenant  shall  be  in  default  of  its  obligations  under  this  Lease:

     A.     RENT  PAYMENTS.  Tenant  shall  default in the timely payment of the
            --------------
Minimum  Rent,  Additional Rent or any other amounts payable hereunder, and such
default  shall continue for a period of five (5) days following Tenant's receipt
of  written  notice  from  Landlord;  provided,  however, that Landlord shall be
required to issue such written notice no more than two (2) times during any year
within  the  Lease  Term, thereafter an Event of Default shall be deemed to have
automatically  occurred  five (5) days following due date where any such payment
was  due  and  remains  unpaid;  or

     B.     NON-MONETARY  EVENTS.  Tenant  shall  neglect  or fail to perform or
            --------------------
observe  any  of  the  other  covenants  herein contained on Tenant's part to be
performed  or  observed,  and Tenant shall fail to remedy the same within thirty
(30)  days following Tenant's receipt of written notice form Landlord specifying
such neglect or failure and indicating that the same has not been performed  (or
within  such period, if any, as may be reasonably required to cure such default,
if the nature of such default is such that it cannot be cured within said thirty
(30)  day  period, provided that Tenant shall have commenced to effect such cure
and  shall  proceed  with  due  diligence  to  complete  such  cure);  or

                                      -27-
<PAGE>
     C.     BANKRUPTCY.  Tenant  shall  (i)  be  adjudicated  a  bankrupt  or
            ----------
insolvent,  or  (ii)  file a petition in bankruptcy or for reorganization or for
the  adoption  of  an  arrangement  under  the  Bankruptcy Act (as now or in the
future  amended), or (iii) make an assignment of its property for the benefit of
its  creditors;  or

     D.     VACATION  OR ABANDONMENT.  Tenant shall vacate or abandon the Leased
            -------------------------
Premises,  and  in  connection  therewith,  shall  fail  to  pay  Minimum Rent,
Additional  Rent  or  any other amounts payable hereunder, or shall otherwise in
connection  therewith  neglect  or  fail  to perform or observe any of the other
covenants  herein  contained on Tenant's part to be performed or observed within
the  time  periods  described  herein;  or

     E.     FAILURE  TO RENEW LETTER OF CREDIT.  Tenant shall fail to deliver to
            ----------------------------------
Landlord,  or cause to be delivered to Landlord, a new Letter of Credit no later
than  thirty (30) days prior to its stated expiration date of the current Letter
of  Credit,  and  having  an  expiration  date  of  at  least twelve (12) months
following  the expiration date of the current Letter of Credit.  In the event of
an  Event  of  Default  arising  under the provisions of this Item E "Failure to
                                                                      ----------
Renew  Letter  of  Credit",  and  in addition to all other rights or remedies of
    ---------------------
Landlord  applicable  to such Event of Default, Landlord shall have the right to
immediately  draw  upon  the  Letter  of  Credit  in  accordance with its terms.

With the exception of the Event of Default set forth in Item E "Failure to Renew
                                                                ----------------
Letter of Credit" above, in the event of any one or more such Events of Default,
----------------
Landlord  shall  have  the  right,  at its election, provided Landlord has given
prior  written  notice  to  Tenant then or at any time thereafter and while such
Event  of Default shall continue, and to the extent permitted by applicable law,
to  either:

     1.     Give Tenant written notice of Landlord's intention to terminate this
Lease  on the date of such given notice or any later date specified therein, and
on such specified date Tenant's right to possession of the Leased Premises shall
cease  and  this  Lease  shall  thereupon  be  terminated;  or

     2.     Without  further  notice, re-enter and take possession of the Leased
Premises,  or  any  part thereof, and repossess the same as of Landlord's former
estate, and expel Tenant and  those claiming through or under Tenant, and remove
the  effects  of  either  or  both (forcibly, if necessary) without being deemed
guilty  of  any  manner  of  trespass  and without prejudice to any remedies for
arrears  of  rent  or  preceding  breach of covenants.  Should Landlord elect to
re-enter  as  provided in this paragraph (2), or should Landlord take possession
pursuant  to legal proceedings or any notice provided  for by law, Landlord may,
from time to time, without terminating this Lease, relet the Leased Premises, or
any  part  thereof, on behalf of Tenant for such term or terms, and at such rent
or  rents,  and  upon  such  other  terms  and  conditions  as Landlord may deem
advisable  (which  may include concessions and free rent) with the right to make
alterations  and  repairs to the Leased Premises.  No such re-entry or taking of
possession  of the Leased Premises by Landlord shall be construed as an election
on  Landlord's  part  to  terminate  this  Lease,  unless  a  written  notice of
termination, specifically stating Landlord's intention to terminate, be given to
Tenant.

     In  the  event  Landlord does not elect to terminate this Lease, but on the
contrary,  elects  to  take possession, then such repossession shall not relieve
Tenant  of  its  obligations  and liability under this Lease, all of which shall
survive  such repossession.  In the event of such repossession, Tenant shall pay
to  Landlord  as  rent:

     (i)     The  Minimum  Rent  and  other sums as hereinbefore provided, which
would  be  payable  hereunder  if  such  repossession  had  not  occurred;  less

     (ii)     The  net  proceeds,  if  any,  of  any  reletting, or the value of
Landlord's use, if any, of the Leased Premises after deducting all of Landlord's
reasonable  costs and expenses in connection with such reletting, including, but
without  limitation,  all  reasonable repossession costs, brokerage commissions,
legal  expenses,  attorneys  fees,  expenses  of employees, necessary alteration
costs  and  expenses  of  preparation  for  such  reletting.

                                      -28-
<PAGE>
     Tenant  shall  pay  such  rent to Landlord on the days on which the Minimum
Rent  would  have been payable hereunder if possession had not been retaken, and
Landlord shall be entitled to receive the same from Tenant on each such day.  If
either Landlord or Tenant shall be required to commence any action or proceeding
to collect the foregoing amounts, or to enforce any other obligation of Landlord
or  Tenant  under  this  Lease, Landlord or Tenant, as the case may be, shall be
entitled  to  a reimbursement of all costs and expenses incurred in said matter,
including  reasonable  attorneys  fees.

     If  this  Lease  is  terminated  by  Landlord,  by reason of any default by
Tenant,  or  terminated  by  a  court  of lawful jurisdiction, Landlord shall be
entitled  to  recover  as damages from Tenant the excess, if any, of the Minimum
Rent  reserved  in  this  Lease  for the balance of the Lease Term over the then
reasonable  rental value of the Leased Premises for the same period, plus all of
Landlord's costs of reletting the Leased Premises including, but not limited to,
repair,  alteration  and  preparation of said Leased Premises for reletting, and
any  brokerage  commission  paid  or due to any agent of Landlord, which amounts
shall  be  immediately  due  and  payable  by  Tenant to Landlord.  In addition,
Landlord  shall  also  recover  from Tenant any rent exemption, deferred rent or
excused  rent  which  Landlord  may  have  granted to Tenant as an inducement to
Tenant's  execution hereof, it being understood that Landlord's granting of such
a  rent  holiday  is  in consideration of Tenant's compliance with the terms and
provisions  hereof.  It  is agreed that the then "reasonable rental value" shall
be  the amount of rent which Landlord may then reasonably obtain as rent for the
remaining  balance  of  the  Lease Term (including concessions and free rent, if
necessary).  In  addition, all costs incurred in connection with collecting such
sum,  including  reasonable  attorneys  fees  and costs, shall be recoverable by
Landlord  from  Tenant.  Any  such  damages payable to Landlord pursuant to this
paragraph shall be payable, at Landlord's option, in a lump sum as aforesaid, in
equal monthly installments throughout the remainder of the Lease Term, or at the
end  of  the Lease Term (in which event the "reasonable rental value" shall mean
the  actual  rental  received  by  Landlord).

                                      -29-
<PAGE>
     Notwithstanding anything contained in the Lease or in the Colorado statutes
to the contrary, Tenant hereby waives any and all rights it may have to cure any
substantially  similar  Event of Default more than three (3) times in any twelve
(12)  month  period.  In  the  event of the foregoing occurrence of an "Event of
Default" more than three (3) times in any twelve (12) month period, Tenant shall
immediately  forfeit  the  benefit  of  any deferred rent and/or any unamortized
portion  of  the  Landlord's  tenant finish costs, whether or not accrued at the
time  of  said  default.  Minimum  Rent  for  the  forfeited  periods  and  any
unamortized  portion of Landlord's tenant finish costs shall be due on the first
of the month following such default.  In the case of an Event of Default arising
from  Item  E "Failure to Renew Letter of Credit" above, Landlord shall have the
               ---------------------------------
right,  at  its  election,  to  immediately  draw  upon  the Letter of Credit in
accordance  with  its  terms;  provided,  however,  that in such event, Landlord
hereby  agrees  that  the  proceeds from such Letter of Credit shall be held and
applied  by  Landlord  as  required  by  the provisions of Article XXV "Security
                                                                        --------
Deposit  -  Letter  of  Credit"  below.
------------------------------

                              ARTICLE  XXI
                          OPTION  TO  EXTEND

     Subject to the provisions of Article XIX "Landlord's Sale or Transfer," and
                                               ---------------------------
upon  condition  that  Tenant  (i)  is  not  then  in default at the time of the
exercise  of any option beyond any applicable cure periods, (ii) has not been in
default more than two (2) times during the Lease Term beyond any applicable cure
periods,  and  (iii) is not in default as of the commencement thereof beyond any
applicable  cure  periods,  Landlord  grants  to Tenant the option to extend the
Lease  Term for one (1) period of five (5) years (the "Extended Term"), all upon
the same terms and conditions herein contained, except for Minimum Rent, and the
extension option granted herein.  During the Extended Term, the Minimum Rent for
each  year of the Extended Terms (12 consecutive months) shall, unless otherwise
agreed  in  writing, be adjusted to the then prevailing market rate for premises
of similar size, location, age and amenities to the Leased Premises, as mutually
determined  by  Landlord  and  Tenant  in  each  of  their respective reasonable
discretions,  taking  into  consideration  the  Option  Period  Annual Increases
described  below,  and  the fact that this will be an extension or renewal of an
existing lease and not a new lease, thereby relieving Landlord of the obligation
to pay commissions, tenant improvement allowances and other such concessions and
consideration  typically  required  by  a  new  lease  (the "Fair Market Rent").
Thereafter,  during  each  Lease  Year  of  the  Extended Term, the Minimum Rent
payable  by  Tenant  shall  be increased by the greater of:  (i) 4% per year, or
(ii)  the  percentage  change  in  the  Consumer Price Index (as defined below):

For  purposes  of  the  foregoing,  changes in the Consumer Price Index shall be
calculated  as  follows:

     (a) The term "Consumer Price Index" shall mean the Consumer Price Index for
     All Urban  Consumers,  All  Items  (Base  Year  1982-1984=100),  U.S.  City
     Average,  published by the United  States  Department  of Labor,  Bureau of
     Labor  Statistics.  If the Consumer Price Index is  discontinued or revised
     during the term of this Lease, such other governmental index or computation
     with which it is  replaced  shall be used in order to obtain  substantially
     the same result as would have been obtained if the Consumer Price Index had
     not been discontinued or revised.

     (b) For purposes of this  provision,  the "Current  Index" shall mean, with
     respect to any particular  increase in the Minimum Rent, the Consumer Price
     Index which applies to that month which is two (2) months immediately prior
     to the  adjustment.  For example,  for the first  adjustment to the Minimum
     Rent which is to occur on the thirteenth (13th) month of the Extended Term,
     the Current Index shall be the Consumer Price Index for the eleventh (11th)
     month of the Extended  Term.  In addition,  the "Base Index" shall mean the
     Consumer  Price  Index for that month  which is two (2) months  immediately
     prior to the commencement of the Extended Term.

     (c) For purposes of determining  the increases in the Minimum Rent for each
     successive  twelve (12) month  period  during the Extended  Term,  the Base
     Index shall be subtracted from the Current Index and that difference  shall
     be  divided by the Base  Index.  The  resulting  quotient,  expressed  as a
     percentage,  shall be the amount of the  increase in the Minimum  Rent from
     the amount of Minimum  Rent  payable  during the twelve  (12) month  period
     prior to such adjustment;  provided, however, that the parties hereby agree
     that in no event shall the Minimum Rent increase for any year exceed a four
     percent (4%)  increase  from the amount of Minimum Rent payable  during the
     twelve (12) month period immediately prior to such increase.  This Consumer
     Price Index  calculation  set forth above is  represented  by the following
     formula:

                                  C  -  B  x  100%
                                  -------
                                     B

     In such formula,  "C"  represents  the Current Index and "B" represents the
     Base Index.

     By way of illustration only, and not by way of limitation, the increases in
     Minimum Rent are to be calculated as follows:

     1.   Increase for the thirteenth (13th) month of the Extended Term:
          --------------------------------------------------------------
          Assume the "Base Index" = 320;  Assume the  "Current  Index" = 329 The
          increase in the Minimum  Rent for  purposes of the  thirteenth  (13th)
          month and the following  eleven (11) months of the Extended Term would
          be calculated as follows:

                                  329-320  x  100  =  2.81%
                                  -------
                                    320

          Assuming  the  Minimum  Rent during the  twelfth  (12th)  month of the
          Extended  Term was  $69,025,  the increase in the Minimum Rent for the
          thirteenth  (13th) month and the  following  eleven (11) months of the
          Extended  Term would be  calculated  as follows:  $69,025.00 X 2.81% =
          $1,939.60,  which would  equate to a Minimum  Rent of  $70,964.60  per
          month. Because this amount is less than a 4% increase from the Minimum
          Rent payable immediately prior to the adjustment,  the actual increase
          in the Minimum Rent would be $69,025.00 X 4% = $2,761.00,  which would
          equate to a Minimum Rent during such period of $71,786.00 per month.

     2.   Increase for the twenty-fifth (25th)  month  of  the  Extended  Term:
          ----------------------------------------------------------------------
          Assume the "Base Index" = 320;  Assume the  "Current  Index" = 345 The
          increase in the Minimum Rent for purposes of the  twenty-fifth  (25th)
          month and the  following  eleven (11) month period would be calculated
          as follows:

                                  345  -  320  x  100  =  7.81%
                                  -----------
                                      320

          Because this  increase is greater than 4%, the actual  increase in the
          Minimum Rent would be $71,786.00 X 4% = $2,871.00,  which would equate
          to a Minimum Rent during such period of $74,657.44 per month.

     In  the  event  Tenant  elects to exercise such Extended Term, Tenant shall
provide  Landlord  with  written notice of such fact no less than six (6) months
prior to the expiration of the initial Lease Term.  Tenant's failure to exercise
its  option  for  the  Extended Term shall conclusively waive its option for the
Extended  Term.  Following  Tenant's exercise, the initial Minimum Rent (subject
to annual increases described above) for the Extended Term will be determined as
follows:

     (aa)     Landlord  and  Tenant  will  have fifteen (15) days after Landlord
receives  Tenant's  written  notice exercising the Extended Term within which to
agree  on  Fair  Market  Rent  for the Leased Premises and thus the Minimum Rent
payable  during  the  first  year  of the Extended Term.  If Landlord and Tenant
agree  upon  such Fair Market Rent, then they will enter into a formal amendment
of  this Lease, clarifying the Extended Term and the Minimum Rent payable during
the  first  year of the Extended Term, subject to the annual increases described
above.

(bb)     In  the  event  Landlord  and  Tenant are unable to agree upon the Fair
Market  Rent  for  the Leased Premises within such fifteen (15) day period, then
within  seven  (7)  days after the expiration of the fifteen (15) day period set
forth  above,  the  parties  will  attempt to agree upon the selection of an MAI
appraiser having at least five (5) years of full time experience in the Colorado
Springs  market  to  determine  the Fair Market Rent for the Leased Premises and
thus  the  Minimum  Rent payable during the first year of the Extended Term.  If
Landlord  and  Tenant  agree  upon  an  MAI appraiser, then that appraiser shall
determine  the  Fair  Market  Rent  for the Leased Premises and the parties will
enter  into  a  formal amendment of this Lease, clarifying the Extended Term and
the  Minimum  Rent  payable  during the first year of the Extended Term, and the
annual  increases described above.  If the parties cannot mutually agree upon an
appraiser, then within seven (7) days thereafter, each party will hire, at their
own  expense,  an MAI appraiser who meets the above qualifications, and together
such  MAI  appraisers  shall,  within  ten  (10)  days thereafter, select as the
arbitrator  a  third  MAI  appraiser  who  meets  the  above qualifications (the
appraiser  selected  shall  be  deemed  the  "Arbitrator"  hereunder).

                                      -30-
<PAGE>
(cc)     Within  ten  (10)  days  of  selection  of the Arbitrator, Landlord and
Tenant shall each state, in writing, their determination of the Fair Market Rent
for  the  Leased  Premises supported by the reasons therefor, and shall delivery
counterpart copies to each other and to the Arbitrator, under an arrangement for
simultaneous  exchange  of  the determinations.  Thereafter, the Arbitrator will
review  each  party's  written  determination of the Fair Market Rent, and will,
within  ten  (10)  days  of  the Arbitrator's receipt of Landlord's and Tenant's
written  statement,  select  the  statement which the Arbitrator determines most
accurately  reflects such Arbitrator's determination of the Fair Market Rent for
the  Leased  Premises  during the first year of the Extended Term.  In the event
either  party  shall  fail  to  timely  submit  their written statement of their
determination  of  the  Fair Market Rent for the Leased Premises, then the other
party's  determination  shall  establish  such  Fair Market Rent. The Arbitrator
shall have no right to propose a middle ground or any modifications of either of
the  two  written  statements.  Upon  making  such determination, the Arbitrator
shall  advise  the parties in writing and the Minimum Rent to be paid during the
first  year  of the Extended Term shall be the Fair Market Rent as so determined
by  the  Arbitrator (and the parties shall thereafter set out the 2.5% increases
during  each  subsequent  year  of  the  Extended  Term).  The  cost incurred in
connection  with engaging the Arbitrator shall be shared equally by Landlord and
Tenant,  and  shall  be  determined at the time the Arbitrator is selected.  The
determination  of  the  Arbitrator shall conclusively determine the Minimum Rent
payable  during  the  first  year  of  the  Extended  Term.

                                   ARTICLE  XXII
                               LATE  RENT  PAYMENT

     Any payment of Minimum Rent, Additional Rent or any obligation hereof which
may be satisfied by the payment of money, shall bear interest at the greater of:
(i)  the  maximum  rate permitted by applicable law, or (ii) 12% per annum, from
and  after ten (10) days following the date due until paid.  Tenant acknowledges
that  late  payments  by  Tenant to Landlord of such rent and other charges will
cause  Landlord  to incur costs not contemplated by this Lease, the exact amount
of  such  costs  being extremely difficult and impracticable to fix.  Such costs
include, without limitation, processing and accounting charges, and late charges
that  may  be  imposed  on  Landlord  by  the terms of any encumbrance and notes
secured  by  any  encumbrance  covering  the Leased Premises.  Therefore, if any
installment  of rent due from Tenant is not received by Landlord within ten (10)
days  of when due, Tenant shall pay to Landlord an additional sum of $1,000 as a
late  charge.  The  parties  agree  that  this late charge represents a fair and
reasonable  estimate  of  the  costs  that Landlord will incur by reason of late
payment  by  Tenant.  Any  acceptance  of any late charge shall not constitute a
waiver  of  Tenant's  default  with  respect  to  the overdue amount, or prevent
Landlord  from  exercising  any  of  the  other rights and remedies available to
Landlord.  Additionally,  Tenant  shall pay a $250 charge for any checks written
to  Landlord  which  are  returned  due  to  insufficient  funds.

                                   ARTICLE  XXIII
                        NON-DISTURBANCE  AND  SUBORDINATION

     Subject  to  Landlord's  representations  set  forth  in  Article  VIII
"Maintenance  of  the  Building  and  Repairs"  Subsection  C  "Landlord's
           ----------------------------------                   ----------
Representations  and  Warranties"  above,  Tenant accepts this Lease subject and
           ---------------------
subordinate  to  any  recorded mortgage or deed of trust lien presently existing
upon  the  Building  or the Property, and to all existing recorded restrictions,
covenants,  easements  and agreements with respect to the Building, the Property
or  the  Project.  Landlord  is  hereby  irrevocably  vested with full power and
authority  to  subordinate Tenant's interest under this Lease to any mortgage or
deed  of  trust  lien hereafter placed on the Leased Premises, and Tenant agrees
upon  demand  to  execute  additional  instruments  subordinating  this Lease as
Landlord  may  require,  subject  to  Tenant's  concurrent  receipt  of  a
non-disturbance  agreement  from  the  holder  of  such  instrument  in  a  form
customarily  acceptable  between  commercial lending institutions and tenants of
other  similar  buildings  in  the  Colorado  Springs area.  If the interests of
Landlord under this Lease shall be transferred by reason of foreclosure or other
proceedings  for  enforcement  of  any  mortgage  or deed of trust on the Leased
Premises,  then  subject  to  Tenant's  concurrent  receipt of a non-disturbance
agreement  from  the  holder of such instrument in a form customarily acceptable
between  commercial  lending institutions and tenants of other similar buildings
in the Colorado Springs area, Tenant shall be bound to the transferee (sometimes
called the "Purchaser"), under the terms, covenants and conditions of this Lease
for  the  balance  of  the  Lease  Term  remaining,  including any extensions or
renewals, with the same force and effect as if the Purchaser were Landlord under
this  Lease,  and, if requested by the Purchaser, Tenant agrees to attorn to the
Purchaser,  including  the  mortgagee  under  any  such  mortgage  if  it be the
Purchaser,  as  its  Landlord.

                                      -31-
<PAGE>
                                   ARTICLE  XXIV
                                      NOTICES

     All  notices  to  be  given  hereunder by either of the parties shall be in
writing.  Any  notice  may  be  served  by  Landlord  upon  Tenant personally by
delivering  the  same  to  either  the  address  set  forth  in  the Basic Lease
Provisions,  or  to  the  Leased Premises.  Any notice shall also be deemed duly
served by either party if mailed by registered or certified mail, return receipt
requested,  with  proper postage prepaid, addressed to each party at its address
set forth in the Basic Lease Provisions.  Either party may change the address to
which notices may be sent by delivering a copy thereof to the other party in the
manner  aforesaid.  If  service  shall  be made by registered or certified mail,
such  service shall be complete as of the next day following the mailing of such
notice  in  the  manner  aforesaid.

                                   ARTICLE  XXV
                      SECURITY  DEPOSIT  -  LETTER  OF  CREDIT

     Concurrent  with  the  execution  of  this Lease, Tenant has deposited with
Landlord  the  Letter  of Credit in the form attached as Exhibit "C" hereto, and
                                                         -----------
Tenant  covenants to keep the same on deposit at all times during the Lease Term
(unless  the  same shall be drawn upon by Landlord for Tenant's failure to renew
the  same  as required by the provisions of Article XX "Default" Item E "Failure
                                                        -------          -------
to  Renew  Letter  of  Credit", in which event Landlord shall hold and apply the
 ----------------------------
proceeds of the Letter of Credit as a Security Deposit, and Tenant shall have no
further  obligation  to  renew  the Letter of Credit).  Landlord and Tenant each
hereby  understand  and  agree  that, from and after June 30, 2003, and provided
                                                     -------------
Tenant  is not then in default beyond any applicable cure periods, the amount of
the  Letter  of  Credit  may  be reduced from $1,000,000 to $500,000 through the
balance of the Lease Term.  In addition, in the event that Tenant is profitable,
and  has a current ratio of 2.0 or quick ratio of 1.0 or better as determined by
a  full CPA audit and unqualified opinion in conformance with generally accepted
accounting  principals  and  generally  accepted  auditing  standards  after the
completion  of the fifth (5th) year of the Lease Term (or the closest subsequent
fiscal  year  end of Tenant), then the requirement for maintaining the Letter of
Credit  shall  be waived by Landlord.  In such event, the Letter of Credit shall
be  returned  to  Tenant  within  ten  (10)  days  of receipt by Landlord of the
conforming  audited  financial statements of Tenant, whereupon Tenant shall then
immediately deposit with Landlord good funds to be held as a security deposit in
an  amount  equal  to:  (i)  the  first  month  of  Minimum  Rent  for the month
immediately  subsequent to the return of the Letter of Credit, and (ii) the last
month  of  the  first  term  of  this Lease (collectively, the "Security Deposit
Funds").

     Upon  Landlord's  drawing  upon  the  Letter  of  Credit,  or upon Tenant's
replacement  thereof  with the Security Deposit Funds as contemplated above, the
proceeds thereof (hereinafter, the "Security Deposit") shall be held by Landlord
for  the  performance of Tenant's covenants and obligations under this Lease, it
being  expressly understood that the Security Deposit shall not be considered an
advance  payment  of  Minimum  Rent or a measure of Landlord's damage in case of
default  by  Tenant.  Upon  the  occurrence of any Event of Default by Tenant or
breach by Tenant of Tenant's covenants under this Lease, Landlord may, from time
to  time, without prejudice to any other remedy, use the Security Deposit to the
extent  necessary to make good any arrears of rent, to cure Events of Default or
breaches  of Tenant's covenants hereunder, or to repair any damage or injury, or
pay  any  expense  or liability incurred by Landlord as a result of the Event of
Default or breach of covenant, or to pay any and all expenses and costs incurred
by  Landlord  in  connection with its drawing upon the Letter of Credit, and any
remaining  balance  of the Security Deposit shall be held by Landlord during the
Lease  Termand  thereafter  any  unused  portion  thereof  shall  be returned by
Landlord  to  Tenant  upon  termination of this Lease and satisfaction of all of
Tenant's  other  obligations  under  this  Lease.

                                      -32-
<PAGE>
     Landlord  and Tenant each hereby agree that, in the event Landlord draws on
the Letter of Credit such that, following Landlord's application of the proceeds
of  the  same  to  make  good  any arrears of rent, to cure Events of Default or
breaches  of Tenant's covenants hereunder, or to repair any damage or injury, or
pay  any  expense  or liability incurred by Landlord as a result of the Event of
Default or breach of covenant, or to pay any and all expenses and costs incurred
by  Landlord  in  connection  with its drawing upon the Letter of Credit, Tenant
shall be entitled to interest on all remaining proceeds resulting from such draw
on  the Letter of Credit, to the extent such remaining proceeds exceed $150,000,
at  the  rate  of  interest  from  time  to  time offered by Wells Fargo Bank in
connection  with  fourteen  (14)  day  Certificates of Deposit, and Landlord and
Tenant  each hereby agree that Tenant shall be entitled to a disbursement of all
such  accrued  interest  at  the  end  of  each  year  of  the Lease Term, and a
disbursement  of  all accrued but unpaid interest on such Security Deposit funds
upon  expiration  of  the  Lease  and  Landlord's  return  of the balance of the
Security  Deposit  to  Tenant  as  contemplated  above.  In  connection with the
contemplated  Hexokee  Transfer  and  Assignment, should the same occur (but not
with  respect  to  any other or subsequent assignment of Landlord's rights under
this  Lease), Tenant shall pay, at its sole cost and expense, the "transfer fee"
payable  pursuant to the Letter of Credit.  Any subsequent or other transfers of
the  Letter  of Credit necessitated by Landlord's assignment of its rights under
this  Lease  shall  be  paid  by  Landlord,  at  its  sole  cost  and  expense.

                                   ARTICLE  XXVI
                                   MISCELLANEOUS

     A.     COVENANT DEPENDENCY.  The obligation of Tenant to pay rent hereunder
            -------------------
is  independent of each and every other Covenant, duty or obligation of Landlord
herein,  and  is  not  subject  to  deduction  or  offset.

     B.     LIENS.  Tenant shall not permit mechanics', material men's, or other
            -----
liens  against  the Building in connection with any labor, materials, equipment,
or  services  furnished,  or  claimed  to have been furnished.  If any such lien
shall  be  filed against the Building as a result of the foregoing, Tenant shall
cause  it to be discharged at its sole cost and expense; provided, however, that
if  Tenant  desires  to  contest  any  such  lien,  it may do so, so long as the
enforcement  thereof  is  stayed.  In  the  event such a stay is obtained Tenant
shall  obtain  title  insurance  in  the  amount of the lien or liens (including
interest  and costs) for the benefit of Landlord should Landlord desire the same
for  any  period  during  which  a  lien or liens exist on the Project.  In such
event,  Tenant  shall, if necessary, pay required title insurance premiums, post
bond  sufficient  to  satisfy the title insurer's requirements, pay escrow costs
and  fees,  pay  the  reasonable  attorneys fees of Landlord, and sign indemnity
agreements  in  favor  of  the  title  insurer.

     C.     RELATIONSHIP  OF  PARTIES.  Nothing contained herein shall be deemed
            -------------------------
or  construed  by  the  parties  hereto, nor by any third party, as creating the
relationship  of principal and agent or a partnership or a joint venture between
the  parties  hereto,  it being agreed that neither the method of computation of
rents  or  any  other  provisions  set  forth herein nor any acts of the parties
herein  shall  be  deemed  to create any relationship between the parties hereto
other  than  the  relationship  of  Landlord  and  Tenant.

     D.     REPRESENTATIONS.  Landlord  and  Tenant  each hereby acknowledge and
            ---------------
agree that they have not relied upon any statements, representations, agreements
or  warranties,  except  such  as  are  expressed  in  this  Lease.

     E.     AMENDMENTS  OR  MODIFICATIONS.  No amendment or modification of this
            -----------------------------
Lease  or  any  approvals  or  permissions of Landlord required under this Lease
shall  be valid or binding unless reduced to writing and executed by the parties
hereto  in  the  same  manner  as  the  execution  of  this  Lease.

     F.     GRAMMATICAL CHANGES.  Wherever the words "Landlord" and "Tenant" are
            -------------------
used in this Lease, they shall include "Landlords" and "Tenants" and shall apply
to  persons,  both  men  and  women,  companies,  partnerships and corporations.
Wherever  the  words "mortgage" or "mortgages" are used herein the same shall be
deemed  to  include  a  deed of trust or trust deed, and the word "lender" shall
include  a  mortgagee of a mortgage or a beneficiary of a deed of trust or trust
deed.  For  purposes  of  this  Lease,  the  term "rent" as used herein shall be
deemed  to  mean  any  and  all  Minimum Rent, Additional Rent or other monetary
obligations of Tenant hereunder.  All references to the Lease Term shall include
any  extension  of the Lease Term, except as otherwise provided.  All references
to  Tenant  shall  include  Tenant's  guarantors,  assignees  or sublessee.  All
reference  to  the  singular  shall  include  the  plural,  and  vice  versa.

                                      -33-
<PAGE>
     G.     SECTION HEADINGS.  The section headings are inserted herein only for
            ----------------
convenience of reference and shall in no way define, limit or describe the scope
or  intent  of  any  provisions  of  this  Lease.

     H.     BINDING  EFFECT.  Subject  to the provisions hereof, the benefits of
            ---------------
this  Lease and the burdens hereunder shall respectively inure to and be binding
upon the heirs, successors, personal representatives and assigns of the parties.

     I.     FORCE  MAJEURE.  Whenever  a  period  of time is herein provided for
            --------------
either party to do or perform any act or thing, except for the payment of monies
by Tenant and except as may otherwise be expressly set forth herein, there shall
be  excluded  from  the  computation  of  such  period of time any delays due to
strikes,  riots,  acts  of  God,  shortages  of  labor,  governmental control or
directive  from  any  governing authority or any cause or causes, whether or not
similar  to  those  enumerated,  beyond  the  parties' reasonable control or the
reasonable  control  of  their  agents,  servants,  employees and any contractor
engaged  by  them  to  perform  work  in  connection  with  this  Lease.

     J.     PERSONAL  PROPERTY  TAXES.  Tenant  shall pay before delinquency any
            -------------------------
personal  property  taxes  attributable to the furniture, fixtures, merchandise,
equipment,  or  other personal property situated on the Leased Premises.  If any
such personal property taxes are levied against Landlord or Landlord's property,
and  if Landlord pays the same (which Landlord shall have the right to do) or if
the  assessed value of Landlord's premises is increased by the inclusion therein
of a value placed on such property, and if Landlord pays the taxes based on such
increased  assessment  (which  Landlord shall have the right to do), Tenant upon
demand  shall  repay  to  Landlord  the  taxes so levied against Landlord or the
proportion  of  such  taxes  resulting  from  such  increase  in  assessment.

     K.     NON-WAIVER.  No  waiver  of  condition  or covenant of this Lease by
            ----------
either  party  hereto shall be deemed to imply or constitute a further waiver by
such party of the same or any other condition or covenant.  No act or thing done
by  Landlord  or  Landlord's  Agents  during  the  Lease Term shall be deemed an
acceptance  of  a  surrender  of the Leased Premises, and no agreement to accept
such  surrender  shall  be  valid  unless  signed  in  writing by Landlord.  The
delivery  of  Tenant's  keys  to  any  employee  or  agent of Landlord shall not
constitute  a  termination  of  this  Lease  unless a written agreement has been
entered  into  with  Landlord to this effect.  No payment by Tenant, nor receipt
from  Landlord, of a lesser amount than the Minimum Rent herein stipulated shall
be  deemed  to  be other than on an account of the earliest stipulated rent, nor
shall  any  endorsement or statement on any check or any letter accompanying any
check,  or  payment  as rent, be deemed an accord and satisfaction, and Landlord
shall  accept  such  check  for payment without prejudice to Landlord's right to
recover  the  balance  of  such  rent  or  pursue  any other remedy available to
Landlord.  If  this  Lease  be  assigned,  or if the Leased Premises or any part
thereof  be sublet or occupied by anyone other than Tenant, Landlord may collect
rent from the assignee, subtenant or occupant and apply the net amount collected
to  the rent herein reserved, but no such collection shall be deemed a waiver of
the  covenant herein against assignment and subletting, or the acceptance of the
assignee,  subtenant  or  occupant  as  tenant,  or a release of Tenant from the
complete  performance by Tenant of the covenants herein contained on the part of
Tenant  to  be  performed.

     L.     REIMBURSEMENT  OF  ATTORNEYS  FEES  AND  COSTS.  In the event either
            ----------------------------------------------
party takes legal action against the other in order to enforce the terms of this
Lease,  the  prevailing  party shall recover from the other party its reasonable
attorneys  fees and costs, together with fees charged by accountants, appraisers
and other consultants or experts hired by the prevailing party or its attorneys.

     M.     SHORT FORM LEASE AND NOTICE TO MORTGAGEE.  Landlord and Tenant agree
            ----------------------------------------
not  to  place  this  Lease  of  record, but upon the request of either party to
execute and acknowledge so the same may be recorded, a short form lease shall be
prepared  indicating  the names and respective addresses of Landlord and Tenant,
the  Leased  Premises,  the  Lease  Term,  the  dates  of  the  commencement and
termination of the Lease Term and options for renewal, if any, but omitting rent
and  other  terms  of this Lease.  Tenant agrees to an assignment by Landlord of
rents  and  of  Landlord's interest in this Lease to a mortgagee, if the same be
made by Landlord.  Tenant further agrees that Tenant will give to said mortgagee
a  copy  of  any  request  for  performance  by Landlord or notice of default by
Landlord,  so  long  as  Tenant is provided with the name and mailing address of
such  mortgagee for purposes of such mailing; and in the event Landlord fails to
cure  such  default,  Tenant will give said mortgagee a reasonable period not to
exceed  thirty (30) days within which to cure the same.  Said period shall begin
with  the  last  day  on  which  Landlord could cure such default, before Tenant
exercises  any  remedy  by  reason  of  such  default.

                                      -34-
<PAGE>
     N.     STATUS  STATEMENT OF LEASE.  Tenant agrees, within ten (10) business
            --------------------------
days  of  request  by  Landlord  from  time to time, to execute, acknowledge and
deliver  to  Landlord  a status statement of Lease or Estoppel, substantially in
the  form  of  Exhibit  "H"  attached  hereto,  or  in such other form as may be
               ------------
reasonably  required  by  lenders  of Landlord, to the extent that the facts set
forth therein are true.  Tenant hereby understands, acknowledges and agrees that
the cure provisions concerning non-monetary defaults as set forth in Article XX,
Section  B  "Non-Monetary  Events"  of  this  Lease  shall not apply to Tenant's
             --------------------
obligation  to  provide such status statement to Landlord, and that Tenant shall
be in immediate and material default if such status statement is not provided to
Landlord  within  such  ten  (10)  business  day  period.

     O.     EASEMENTS.  Landlord shall have the right to grant any easements on,
            ---------
over,  under  and  above  the Property for such purposes as Landlord determines,
provided  that  such  easements  will  not  materially  interfere  with Tenant's
business  or  its  right  to  the  use and enjoyment of the Building, the Leased
Premises  or  the  Project.

     P.     HOLDING  OVER.  In the event that Tenant remains in possession after
            -------------
the  expiration of this Lease, without execution of a new Lease, Tenant shall be
deemed to occupy the Leased Premises as a tenant from month to month, subject to
all  conditions, provisions and obligations set forth herein insofar as the same
are  applicable  to  a  month-to-month  tenancy,  except that Minimum Rent shall
increase  to  200%  of  Minimum  Rent for the last year of the Lease Term or any
extension  thereof.  In addition, Tenant shall pay any damages and hold Landlord
harmless  from  any liability incurred in connection with any claims made by any
succeeding  occupant  based  on  delay  of  possession.

     Q.     TIME  OF THE ESSENCE.  Time is of the essence hereof, and each party
            --------------------
shall  perform  its  obligations and conditions hereunder within the time hereby
required.

     R.     UNENFORCEABILITY.  If  any  clause  or  provision  of  this Lease is
            ----------------
illegal,  invalid or unenforceable under present or future laws effective during
the Lease Term, then and in that event it is the intention of the parties hereto
that  the  remainder of this Lease shall not be affected thereby, and it is also
the  intention  of  the  parties  to  this  Lease that in lieu of each clause or
provision  of  this  Lease  that  is illegal, invalid or unenforceable, there be
added  as a part of this Lease a clause or provision as similar in terms to such
illegal, invalid or unenforceable clause or provision as may be  possible and be
legal,  valid  and  enforceable.

     S.     PROVISION,  NEGOTIATIONS  AND  ATTORNEY  DISCLAIMER.  Each and every
            ---------------------------------------------------
provision  of  this  Lease  has  been  independently,  separately,  and  freely
negotiated  by  the  parties  as if this Lease were drafted by both Landlord and
Tenant.  The  parties,  therefore, waive any statutory or common law presumption
which  would  serve  to  have  this  document construed in favor of, or against,
either  party.  No  Broker  of  real  estate associated with this Lease  nor any
affiliate thereof is authorized to give legal or tax advice (unless specifically
licensed  to  do  so  and  hired  for that purpose by one of the parties to this
Lease); no representation or recommendation is made by any Broker of real estate
or its agents, employees or affiliates as to the legal sufficiency, legal effect
or  tax consequences of this document or any transaction relating thereto, since
these  are  matters  which should be discussed by the respective parties to this
Lease  with  their  Attorney.

     In  executing  this  Lease,  Tenant acknowledges and agrees that it has not
relied  on  any  statements  or  representations  of  the Landlord or Landlord's
Agents  as  to the character, type, identity or number of future tenants who may
occupy  the  Project.  Tenant  further  acknowledges and agrees that no promises
have  been  made  by  Landlord  as to the character, type, identity or number of
tenants  who  may  eventually  occupy  the  Project.

     T.     RIGHTS  AND  REMEDIES. The remedies of Landlord shall be cumulative,
            ---------------------
and no one of them shall  be  construed as exclusive of the other, or any remedy
provided  by  law  or  equity.

     U.     CORPORATE AUTHORITY.  Landlord and Tenant each represent and warrant
            -------------------
that  they  have full corporate power and authority to enter into this Lease and
have  taken  all  corporate  action  necessary  to  carry  out  the  transaction
contemplated  hereby,  so  that when executed this Lease constitutes a valid and
binding  obligation  enforceable  in  accordance  with its terms.  Upon request,
Landlord and Tenant shall each provide the other with their respective corporate
resolution  authorizing  execution  of  the  Lease.

                                      -35-
<PAGE>
     V.     FINANCIAL  STATEMENTS.  Landlord  and  Tenant  each  recognize  that
            ---------------------
Tenant  is  a  public company, and as such issues:  (i) within 90 days following
the  end  of  Tenant's  fiscal  year, Annual Financial Statements audited by the
Tenant's  CPA  Auditors  (the "Annual Financial Statements"), and (ii) within 45
days  following  the  end  of each of Tenant's quarterly fiscal years, Quarterly
Published  Financial  Statements  (which  include  Consolidated  Statements  of
Operations,  Consolidated  Balance  Sheets  and  Consolidated Statements of Cash
Flows)  which  are  reviewed  by  Tenant's  CPA  Auditors  without  opinion (the
"Quarterly  Financial  Statements"),  and  such  Annual Financial Statements are
available  to  Landlord (as well as the public) during Tenant's fiscal year.  In
addition  to the foregoing, Tenant hereby agrees to provide Landlord with copies
of  the  following:

          (a) In connection with any general request by Landlord,  not more than
     one (1) time during any given year of the Lease Term,  Tenant shall provide
     Landlord  with the  current  Management  Operating  Statements,  all within
     thirty  (30) days  following  the  request  of  Landlord.  Said  Management
     Operating  Statements  shall be verified as being the true and correct copy
     of Tenant's most recent financial position through certification thereof by
     an authorized officer of Tenant; and

          (b) In connection  with any request by Landlord  related to Landlord's
     attempt to obtain financing for the Building or the Property,  or to secure
     the sale of all or a portion of the Building or the Property,  Tenant shall
     provide   Landlord  with  copies  of  the  current   Management   Operating
     Statements,  as well as the most recent Quarterly Financial Statement,  all
     within fifteen (15) days  following the request of Landlord.  In connection
     therewith, Tenant hereby understands, acknowledges and agrees that the cure
     provisions  concerning  non-monetary  defaults  as set forth in Article XX,
     Section B "Non-Monetary Events" of this Lease shall not apply to Tenant's
                -------------------
     obligation to provide such  information to Landlord,  and that Tenant shall
     be in immediate and material default if such information is not provided to
     Landlord  within such fifteen (15) day period.  Said  Management  Operating
     Statements and the most recent Quarterly  Financial  Statement  provided by
     Tenant  shall be verified as being the true and correct  copies of Tenant's
     most  recent  Management   Operating  Statements  and  Quarterly  Financial
     Statement through certification thereof by an authorized officer of Tenant.

     W.     LIMITATION  OF  LANDLORD LIABILITY.  Tenant specifically agrees that
            ----------------------------------
there  shall  be  absolutely  no  personal  liability  on the part of any of the
members  or  other  owners  of  any  interest  in  Landlord's business, or their
successors,  assigns,  legally appointed representatives, with respect to any of
the  terms,  covenants  and  conditions  of  this  Lease.  In furtherance of the
foregoing,  Tenant  hereby  expressly  agrees  to  look  solely to the assets of
Landlord,  including  any  equity  which  Landlord  holds in the Building or the
Project  of  which  the  Leased  Premises  are a part (collectively, "Landlord's
Assets"),  for  the satisfaction of each and every remedy of Tenant in the event
of  any breach by Landlord of any of the terms, covenants and conditions of this
Lease  to  be performed by Landlord, and further agrees that no liability of the
Landlord  shall,  in any event whatsoever, extend beyond the Landlord to include
any  of the personal assets of the constituent members of the Landlord, or their
respective  heirs,  successors  or  assigns.  The  provisions  contained  in the
preceding sentences are not intended to and will not limit any right that Tenant
might  otherwise  have to obtain injunctive relief against Landlord or relief in
any  suit or action in connection with enforcement or collection of amounts that
may  become  owing  or  payable  under  or on account of insurance maintained by
Landlord.

     X.     INTERPRETATION  AND  VENUE.  The terms of this Lease shall be
            --------------------------
interpreted  according to the laws of the State of Colorado.  Tenant consents to
the  enforcement  by  Landlord of Tenant's obligations hereunder in the District
Court  in  and  for  the  County  of  El  Paso,  Colorado.

     Y.     EXHIBITS  AND  ADDENDA.  The  following  Exhibits and Addenda may be
            ----------------------
attached  to  this  Lease  and if so attached are incorporated herein and made a
part  hereof  by  this  reference:

                                      -36-
<PAGE>
     Exhibits:
     --------

     A.  Plat  Map  of  Building  and  Property
     B.  Depiction  of  Building  Space  Plan
     C.  Form  of  Letter  of  Credit
     D.  Form  of  Work  Letter  for  Expansion  Space
     E.  Rules  and  Regulations
     F.  Depiction  of  Common  Areas  of  the  Project
     G.  Description of Initial Space Improvement Work and Existing Space
         Improvement Work
     H.  Form  of  Tenant  Estoppel  Statement

     Z.     TENANT  REPRESENTATIONS.  In  the event Tenant is a corporation, the
            -----------------------
officers  executing this Lease on behalf of Tenant hereby covenant that they are
duly  authorized  by the corporation to execute this Lease, that the corporation
is  duly  organized  under  the  laws of its State of incorporation and that the
corporation  has  the  full right and authority to enter into this Lease for the
full  term hereof.  In the event Tenant is a general or limited partnership, the
general  partner(s)  executing this Lease on behalf of Tenant hereby covenant(s)
that  he  (they)  is  (are)  duly  authorized by the partnership to execute this
Lease,  that  the  partnership  is duly organized under the laws of the State in
which it was formed and that the partnership has the full right and authority to
enter  into  this  Lease  for  the  full  term  hereof.

AA.      BROKERS.  NAI  Highland  Commercial  Group,  LLC  has  represented  the
         -------
Landlord in connection with this Lease, and The Staubach Company has represented
the  Tenant  in  connection  with  this  Lease.  Any  compensation  due for such
representation  shall  be  based  upon  the  Exclusive  Right-To-Lease Agreement
between  Landlord  and NAI Highland Commercial Group, LLC, and commissions shall
be  paid  in  conformance  with  that  agreement at 7% of the total net rentable
consideration  during  years  1-7  and  three and 3.5% of the total net rentable
consideration  during  years  8-10.  NAI  Highland Commercial Group, LLC and The
Staubach  Company  have agreed to split such commissions 50/50.  Landlord agrees
to  pay  all  real  estate  commission  due in connection with this Lease to the
parties  described  above,  and  Landlord  agrees to indemnify and hold harmless
Tenant  from  and  against  any  liability or claim, whether meritorious or not,
arising  with  respect to any other broker, which claim arises by, through or on
behalf  of Landlord.  Tenant warrants and represents that it has had no dealings
with any real estate broker or agent in connection with the negotiations of this
Lease  except  The  Staubach  Company, and that it knows of no other real estate
broker  or  agent who is or might be entitled to a commission in connection with
this  Lease.

     IN WITNESS WHEREOF, the parties hereto have executed this Lease the day and
year  first  above  written.

                                        LANDLORD:
                                        --------
                                        CHEROKEE  EQUITIES,  LLC,  A
                                        COLORADO  LIMITED  LIABILITY  COMPANY

                                        By:   /s/  Link  Jackson
                                           -------------------------

                                        Its:  Manager
                                           -------------------------

                                        TENANT:
                                        ------
                                        ROCKSHOX,  INC.,  A
                                        DELAWARE  CORPORATION

                                        By:   /s/  Bryan  Kelln
                                           -------------------------

                                        Its:  President  &  CEO
                                           -------------------------

                                      -37-
<PAGE>

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