Document:

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                                                                    EXHIBIT 10.3

                                COMMERCIAL LEASE

     This lease is made this 28th day of May, 2003 by and between Kae Soung
L.L.C. (hereinafter "Lessor") and Westsound Bank (hereinafter "Lessee".) In
consideration for the mutual promises and covenants contained herein, and for
other good and valuable consideration, the parties hereby agree as follows;

1.   PREMISES. The Lessor leases to the Lessee, and the Lessee rents from the
     Lessor the following described Premises commonly known and numbered as 100
     Bethel Ave, Port Orchard Washington 98366:

     Legal Description; TAX ID #4042 - 002 - 007 - 0001

2.   TERM. The term of the Lease shall be for Five (5) years. Payments will
     commence on the sooner of 120 days after execution of lease, or occupancy
     be Lessee and ending on the 31st day of May 2008, but in no event, not
     before June 1, 2003.

3.   OPTION TO RENEW. Provided that Lessee is not in default in the performance
     of this lease, Lessee shall have TWO options to extend this Lease for two
     additional terms of Sixty (60) months each, commencing at the expiration of
     the initial lease term, terms outlined below. All of the terms and
     conditions of the Lease shall apply during the renewal term.

The option shall be exercised by written notice given to Lessor not less than 90
days prior to the expiration of the pertinent lease term. If notice is not given
in the provided herein within the time specified, the option shall expire.

4.   RENT. The Lessee shall pay to Lessor as rent Twenty One Hundred and No/100
     Dollars ($2100.00) per month, payable in advance on the first of each month
     of the lease term, commencing June 1st 2003, with adjustments to be made as
     hereinafter provided, subject to terms outlined in heading "2", TERM.

          Payments shall be made to:            KAE Soung L.L.C.
                                                6314 Valley Ave. E
                                                Fife, WA 98424 (253)922-7623

          Adjustments shall be made as follows:
                                                1st Option: $2333 per month.
                                                2nd Option: $2567 per month.

Commercial Lease - 1                    Lessee: /s/ DJ
                                                --------------------------------

                                        Lessor: /s/ KS
                                                --------------------------------

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     A late charge of Two Hundred and No/100 Dollars ($200.00) will be assessed
the Lessee for any rental payment received after the 5th day of each calendar
month in which the rental is due, and $25.00 for each day thereafter until
received by Lessor. Acceptance of payment without late charge shall not
constitute a waiver of Lessee's obligation for any charges incurred.

     DEFAULT: Three (3) late payments (successive) or any rent payment received
after the 15th day of any calendar month shall constitute default of this
agreement and subject to default provisions specified in Article 20 below.

4.5  DUE DILIGENCE/FEASIBILITY - Lessor acknowledges that Lessee is required to
     obtain local, state, and federal approval prior to proceeding with
     improvements and occupancy. In addition, the Lessee wishes to perform due
     diligence on the condition of the existing structure, to ascertain
     feasibility of cost of improvements. If authorities mandate improvements to
     the structure that prove to be cost prohibitive, or if regulatory operating
     approval, or local business license is not obtained, then lessee will
     notify lessor within 90 days from date of this agreement, and the
     commercial lease agreement will be cancelled. Lessor may be entitled to
     retain deposit, as sole compensation as outlined below.

5.   DEPOSIT. In acknowledgement of the significant investment lessee plans on
     making to the property, there will be no security deposit required.
     However, a non-refundable deposit of $6,000 shall be paid to Landlord, and
     if during the due diligence period, the Lessee elects to opt out and cancel
     the lease, then Lessor, shall be permitted to keep the deposit, and shall
     be entitled to no other compensation.

6.   SUBORDINATION. This Lease is subject to all present or future mortgages
     affecting the Premises and Lessee agrees that this Lease shall be
     subordinate to any existing mortgages or deeds of trust, placed on the
     property, that in the event of foreclosure, if Lessee in not then in
     default and agrees to attorn to the mortgagee or beneficiary under deed of
     trust, such mortgagee or beneficiary shall recognize Lessee's right of
     possession for the term of this Lease.

7.   USE. Lessee shall use and occupy the Premises only as a BANK subject at all
     times to the approval of the Lessor.

Commercial Lease - 2                    Lessee: /s/ DJ
                                                --------------------------------

                                        Lessor: /s/ KS
                                                --------------------------------

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8.   MAINTENANCE AND REPAIRS. The lessee, at his own expense, shall keep the
     roof, exterior walls, the parking lot, landscaping, and structural
     foundations in good repair and to pay for any necessary repairs related
     thereof. Further, Lessee shall at all times through the lease term keep the
     interior of the leased Premises, all windows, glasses, and moldings and
     trim of all doors and windows and all partitions, door surfaces, fixtures,
     equipment's, and appurtenances thereof, in good order, condition, and
     repair. Lessee shall take good care of the Premises and shall not alter,
     repair, or change the Premises without the consent of Lessor, which consent
     will not be unreasonably withheld. All damage or injury done to the
     Premises by Lessee or any other persons who may be in or on the Premises
     with the consent of Lessee shall be paid for by Lessee. In addition, Lessee
     shall, at its own expense, make all necessary repairs and replacement to
     the heating system, plumbing system, and floor within the Premises, and at
     reasonable intervals, paint or refinish the interior of the lease Premises.

9.   ACCESS. Lessee shall permit the Lessor or his agents to make examinations
     of all said Premises at any reasonable time and frequency as Lessor may
     elect.

10.  TAXES. Lessee shall pay all personal property taxes, assessments, or
     governmental charged levied, assessed, or imposed upon or measured by the
     value of it business operation, including, but not limited to: the
     furniture, fixtures, leasehold improvements, equipment, and other property
     of Lessee at any time situated on or installed in the Premises be Lessee.
     Lessee shall keep the Premises free from such tax liens therefore. Should
     there presently be in effect or should there be enacted during the term of
     this Lease any law, statute or ordinance levying any tax (other than
     Federal or State income taxes) Upon rents. Lessee shall pay such tax or
     shall reimburse Lessor on demand for any such taxes paid by Lessor.

11.  UTILITY CHARGES. Lessee shall pay all charges for light, heat, water,
     sewer, garbage, drainage, metro and all other utilities and services to the
     Premises during the term of this Lease.

12.  REPORTS. Lessee shall provide Lessor with copies of any inspection reports
     or other reports with respect to the Premises issued by the fire or health
     department or any government authority with jurisdiction over the Premises
     within ten (10) days of Lessee's receipt of same.

Commercial Lease - 3                    Lessee: /s/ DJ
                                                --------------------------------

                                        Lessor: /s/ KS
                                                --------------------------------

<PAGE>

13.  PUBLIC LIABILITY INSURANCE. Neither Lessor nor its agent shall be liable
     for any injury or damage to persons or property sustained by Lessee or
     others, in and about the Premises. Lessee agrees to defend and hold Lessor
     and its agents harmless from any claim, action and/or judgment for damages
     to property or injury to persons suffered or alleged to be suffered on the
     Premise by any person, film, or corporations, unless caused by Lessor's
     negligence. Lessee Covenants and agrees that it will at all times during
     the terms hereof carry and maintain for the mutual benefit of Lessor and
     Lessee public liability insurance against claims for bodily injury, death,
     or property damage, occuring in, on or about the leased Premises or
     property or in, on or about the streets, sidewalks, or Premises adjacent to
     the leased Premises and arising from the operation of Lessee's business,
     such insurance to afford not less than a combined single limit (bodily
     injury, personal injury and property damage) of $500,000 each occurrence
     and $1,000.000 in the aggregate. Lessee may also maintain a policy with
     respect to the structure, including permanent load-bearing walls and roof.
     Lessor shall be named as one of the insured and shall be furnished with a
     copy of such policy(ies), which shall be acceptable to Lessor and shall
     bear an endorsement that the same shall not be canceled except upon ten
     (10) days' prior written notice to Lessor.

14.  FIRE AND HAZARD INSURANCE. Lessee shall carry, at Lessee's own expense fire
     and hazard insurance for the Premises for the benefit of the parties as
     their interest may appear hereunder and shall provide satisfactory evidence
     thereof to the Lessor and shall continue same in force and effect
     throughout the Lease term hereof.

15.  WASTE. The Lessee shall not permit or commit waste to the Premises.

16.  ASSIGNMENT. The Lessee shall not sublet or assign the Premises nor allow
     any other person or business to use or occupy the Premises without the
     prior written consent of the Lessor, which consent may not be unreasonably
     withheld, unless bank is acquired or merges with another bank, upon which
     No Consent of Assignment is Necessary. Any sale, assignment, mortgage,
     transfer of this Lease or subletting that does not comply with the
     provisions of this paragraph 16 shall be void.

Commercial Lease - 4                    Lessee: /s/ DJ
                                                --------------------------------

                                        Lessor: /s/ KS
                                                --------------------------------

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17.  SIGNS. Lessee shall not construct any projecting sign or awning without the
     prior written consent of Lessor with shall not be unreasonably withheld.

18.  WAIVER. Lessor's acceptance of rent or otherwise shall not be constructed
     as a waiver of any cause of forfeiture, or breach of any condition of this
     Lease; nor shall any assignment or subletting of said Premises, or any part
     thereof, be held to waive or release any assignee or sublessee from any of
     the foregoing conditions or covenants as against him or them, but every
     such assignee and sublessee shall be expressly subject thereto.

19.  SURRENDER AND HOLDOVER. At the end of the term of this lease, Lessee shall
     surrender and deliver up the Premises in the same condition (subject to any
     additions, alterations or improvements, if any) as presently exists,
     reasonable wear and tear excluded.

20.  DEFAULT. Upon default in any term or condition of this Lease, Lessor shall
     have the right to undertake any or all other remedies permitted by Law
     including, but not limited to:

a.   reenter and take possession of the Premises (and all property of Lessee on
     the Premises) using all lawful force and means of self-help to do so;

b.   terminate this Lease by giving Lessee written notice thereof in which event
     Lessee shall immediately pay to Lessor a sum equal to the amount of
     Lessor's costs, expenses, losses, and damages occasioned thereby, such as
     expenses of reletting and collection (including but not limited to,
     attorney's fees, real estate commissions and reasonable costs of renovation
     and alteration of the Premises required to restore the Premises and the
     amount by which the Rent and other amounts due or to become due under this
     Lease for the balance of the Term exceed the amount of Rent Lessor collects
     from reletting of the Premises, if any, for the same period; or

c.   from time to time, without terminating this Lease, relet all or any parts
     of the Premises as the agent and for the account of Lessee such as Rent,
     for such term and upon such terms and conditions as Lessor may in its and
     absolute discretion deem advisable, in which event the Rents received on
     such reletting shall be applied first to the expenses of reletting and
     collection (including, but not limited to, attorney's fees, real estate
     commissions and reasonable costs of renovation and alteration of the
     Premises) and thereafter to payment of all Rent and other amounts due or to
     become due under this Lease, and if a sufficient sum shall not be thus
     realized to pay such amounts, Lessee shall pay Lessor any deficiency
     monthly, and Lessor may bring an action therefore as such monthly
     deficiency shall arise, or, at Lessor's option, bring one or more actions
     for cumulative deficiencies.

Commercial Lease - 5                    Lessee: /s/ DJ
                                                --------------------------------

                                        Lessor: /s/ KS
                                                --------------------------------

<PAGE>

21.  PERFORMANCE OF LESSEE'S OBLIGATIONS BE LESSOR. If Lessee fails to timely
     perform any obligations of Lessee under or otherwise comply with this
     Lease, Lessor may by written notice to Lessee demand such compliance. If
     Lessee fails to commence such compliance within thirty (30) days after
     Lessee's receipt of such demand or if Lessee thereafter fails to diligently
     and assiduously prosecute and achieve such compliance, Lessor may, a
     Lessee's sole risk and expense, perform the compliance by the most
     expeditious means available to Lessor. Lessee shall reimburse Lessor for
     all costs and expenses incurred by Lessor to achieve such compliance.

22.  REMEDIES CUMULATIVE. The rights and remedies of Lessor under paragraphs 24
     and any other provisions of this Lease are cumulative and in addition to
     all other rights and remedies afforded to Lessor by law.

23.  DEFAULT BY LESSOR. Lessor shall not be in default under or breach of this
     Lease unless Lessor fails to perform obligations required by Lessor within
     a reasonable time, but in no event later than thirty (30) days after
     written notice thereof be Lessee to Lessor and to the holder of any
     Mortgage or ground lease affecting the Premises, whose name and address
     shall have therefore been furnished to Lessee in writing; providing,
     however, that if the nature of the default or breach is such that the same
     Cannot reasonably be cured within such thirty (30) day period then Lessor
     shall not be in default or Breach if Lessor shall within such thirty (30)
     day period commence and thereafter diligently Prosecute the same to
     completion.

24.  NOTICES. Any notices given or required to be given hereunder shall be by
     hand delivery, by overnight courier or by telecopy confirmed by answer back
     received. Noticed shall be deemed given on the date sent for hand delivery
     and telecopy, and the day after the date sent for overnight courier. All
     notices shall be sent to the following addresses, or such other addresses
     as the party may direct by written notice:

     If to Lessor: KAE Soung
                   6314 Valley Ave. E
                   Fife, WA 98424
                   (253) 922-7623 (206) 999-4749

     If to Lessee: Westsound Bank
                   P.O. Box 405
                   Bremerton, WA 98337

Commercial Lease - 6                    Lessee: /s/ DJ
                                                --------------------------------

                                        Lessor: /s/ KS
                                                --------------------------------

<PAGE>

25.  TERMINATION. It is mutually agreed that is during the term of this Lease
     the building(s) on the Premises are destroyed or damaged to an extent that
     they are wholly unleasable, the Lessor at their option may terminate this
     Lease by giving the Lessee written notice thereof within fifteen (15) days
     after such damage or destruction. In case the buildings, without fault of
     the Lessee, are destroyed or damages from any cause to an extent that fifty
     percent (50%) or more thereof are wholly unfit for occupancy, and so that
     the same cannot be repaired and made leasable within ninety (90) days
     therefrom, the Lessee shall have the right to terminate this Lease by
     written notice thereof given to the Lessor within ten (10) days after such
     destruction or damage to the demised Premises. In ease of the termination
     of the Lease hereunder, Lessee shall immediately surrender the Premises and
     all interest therein to the Lessors, and shall pay rent hereunder only up
     to the time of such surrender, and thereupon the Lessors may re-enter and
     take possession of the demised Premises and remove all parties therefrom.
     In case of damage or destruction to the Premises as aforesaid and neither
     party terminates the Lease as above provided, the Lessor shall repair and
     restore the same with all reasonable speed, and for that purpose shall have
     the right to enter said Premises. In case such damage shall have occurred
     without fault of the Lessee, but not otherwise, the rental hereby reserved
     shall abate for the portion of said Premises which is unleasable while said
     repairs are being made but shall recommence as soon as said repairs are
     completed. In case such damage to the demised Premises is so slight as not
     to render the same unfit for occupancy, no abatement in the rent shall be
     made.

26.  ESTOPPEL CERTIFICATES. Within ten (10) days following Lessor's request,
     from time to time, Lessee shall execute and deliver to Lessor or any
     prospective Lessor or mortgagee or prospective Mortgagee a sworn statement
     certifying: (a) the Commencement date of this lease, (b) the fact that
     Lease is unmodified and in full force and effect (or, if there have been
     modifications hereto, that this Lease is in full force and effect, as
     modified, and stating the date and nature of such modifications), (c) the
     date to which the rent and other sums payable under this Lease have been
     paid, (d) the fact that there arc no current defaults under this Lease by
     either Lessor or Lessee except as specified in Lessee's statement, and (e)
     such other matter requested be Lessor. Lessor and Lessee intend that any
     statement delivered pursuant to this paragraph may be relied upon by any
     mortgagee, beneficiary or purchaser and Lessee shall be liable for all
     loss, cost or expense resulting from the failure of any sale or funding of
     any loan caused by any material misstatement contained in such estoppel
     certificate. Lessee's breach under this paragraph 26 shall be a default
     under the Lease. In addition to any other legal remedies available to
     Lessor, Lessee shall pay Lessor $200 per day for each day Lessee is in
     breach of this paragraph 26.

Commercial Lease - 7                    Lessee: /s/ DJ
                                                --------------------------------

                                        Lessor: /s/ KS
                                                --------------------------------

<PAGE>

27.  HOLD HARMLESS. Lessee shall indemnify and hold harmless Lessor against and
     from any and all claims arising from Lessee's use of the Premises or from
     the conduct of its business or from any activity, work, or other things
     done, permitted or suffered by Lessee in or about the Premises, and shall
     further indemnify and hold harmless Lessor against and from any and all
     claims arising from any breach of default in the performance of any
     obligation on Lessee's part to be performed under the terms of this
     Agreement, or arising from any act or negligence of Lessee, or any officer,
     agent, employee, guest, or invitee of Lessee, and from all costs, attorneys
     fees, and liabilities incurred in or about the defense of any such claim or
     any action or proceeding brought thereon and in case any action or
     proceeding be brought against Lessor by reason of such claim or proceeding
     be brought against Lessor by reason of such claim, Lessee, upon notice from
     Lessor shall defend the same at Lessee's expense by council reasonably
     satisfactory to Lessor. Lessee, as a material part of the consideration to
     Lessor, hereby assumes all risk of damage to property or injury to persons
     in, upon or about the Premises, from any cause other than Lessor's
     negligence, and Lessee hereby waives all claims in respect thereof against
     Lessor.

28.  GOVERNING LAW. Governing law shall be the laws of the State of Washington.

29.  MISCELLANEOUS. The words "Lessor" and "Lessee" as used herein shall include
     the plural as well as the singular. If there be more than one Lessee, the
     obligations hereunder imposed upon Lessee shall be joint and several. Any
     married individual executing this Lease executes it on behalf of
     him/herself and on behalf of his/her marital community. Time is of essence
     of this Lease and each and all of its provisions. Submission of this
     instrument for examination or signature by Lessee does not constitute a
     reservation of or option for lease, and it is not effective as a lease or
     otherwise until execution and delivery by both Lessor and Lessee. The
     terms, covenants, agreements, and conditions herein contained, shall,
     subject to the provisions as to assignment, apply to and bind the heirs,
     successors, executors, administrators and assigns of the parties hereto. If
     any provision of this Lease shall be determined to be illegal or
     unenforceable, such determination shall not affect any other provision of
     this Lease and all such other provisions shall remain in full force and
     effect.

30.  ENTIRE AGREEMENT. This Lease, together with its exhibits, contains all
     agreements of the parties hereto and supercedes any previous negotiations.
     There have been no representations made by Lessor or understandings made
     between the parties other than those set forth in this Lease. This Lease
     may not be modified except by a written instrument duly executed by the
     parties hereto.

3l.  Night Drop to remain at facility for Lessee's use.

Commercial Lease - 8                    Lessee: /s/ DJ
                                                --------------------------------

                                        Lessor: /s/ KS
                                                --------------------------------

<PAGE>

Signed this 28th day of May, 2003.

LESSEE                                  LESSOR

By: /s/ Dave Johnson                    By: /s/ Kae Soung
    ---------------------------------       ------------------------------------

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

Commercial Lease - 9                    Lessee: /s/ DJ
                                                --------------------------------

                                        Lessor: /s/ KS
                                                --------------------------------<PAGE>
                                                                    EXHIBIT 10.4

PROJECT:             CENTRAL PLAZA

TENANT:              WESTSOUND BANK

USE:                 BANKING AND RELATED USES

SPACE & SQUARE FEET: Suites 1 and 2
                     3193 Sq. Ft.

<PAGE>

                                      LEASE

THIS LEASE is made this 1st day of October, 2001, by and between LOUIS and
DELORES WEIR, husband and wife, hereinafter called "Landlord," and WESTSOUND
BANK, hereinafter called "Tenant."

                              1. BASIC LEASE TERMS

A. COMMENCEMENT DATE: October 1, 2001

B. TENANT: Westsound Bank

   ADDRESS: Central Plaza, Suites 1 and 2, 9960 Silverdale Way, Silverdale,
            WA 98383 Main Address: PO Box 405, Bremerton, WA 98337

   PHONE:   360-405-1200

C. LANDLORD: Louis and Delores Weir

   ADDRESS: P.O. Box 3650
            Silverdale, WA 98383

   PHONE:   (360)698-1276

D. PREMISES AREA: Central Plaza
                  9960 Silverdale Way NW, Suites 1 and 2
                  Silverdale, WA 98383

E. SQUARE FOOTAGE: 3193

F. TENANT'S PERCENTAGE: 11%

G. LEASE TERM: 10 years

H. OPTION TO EXTEND: two 5 year options

I. BASE RENT: $4,257.00 per month increases 5% Annually

J. ADDITIONAL RENT: $958.00 per month increases 3% Annually

K. SIGNAGE: $20.00 per month

L. SECURITY DEPOSIT: $5,235.00

CENTRAL PLAZA LEASE-2

<PAGE>

M. USE OF PREMISES: Banking and related uses

N. BROKERS: None

O. PARKING: Six (6) reserved spaces, signed at Tenant's expense

P. ENUMERATION OF EXHIBITS: The exhibits enumerated in this Section and attached
to this Lease are incorporated herein by reference and are to be construed as
part of this Lease. Each party agrees to perform any obligations on its part
stated in any and all such Exhibits:

    Exhibit A - Site Plan of the Shopping Center
    Exhibit B - Legal Description
    Exhibit C - Rules and Regulations
    Exhibit D - Description of Landlord's and Tenant's Work
    Exhibit E - Corporate Resolution of Tenant

Section 1 represents a summary of the basic terms of this Lease. In the event of
any inconsistency between the terms contained in Section 1 and any other clause
of this Lease, the terms of that clause shall prevail.

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

CENTRAL PLAZA LEASE-3

<PAGE>

                       2. PREMISES AND COMMON AREA LEASED

A. DEFINITIONS.

     1. Landlord hereby leases to Tenant and Tenant leases from Landlord those
     certain premises described in Section 1 and in Exhibit "A" attached hereto
     (the "Premises").

     2. The Premises are contained within a building (the "Building") which is
     located at the address designated in Section 1 and Legally described on
     Exhibit "B" attached hereto (the "Property"). The term "Building" shall
     include all of the rentable square feet and the Common Areas as defined
     herein.

     3. "Common Areas" shall be defined as areas appurtenant to the Premises
     which are not a part of a Premises for any other tenant in the Building,
     including, but not limited to: entrances, lobbies, stairways, common ducts,
     conduits, wire and appurtenant equipment serving the Premises, trash areas,
     parking areas, roadways, sidewalks, walkways, and landscaped areas and
     similar areas and facilities on the Property which are appurtenant to the
     Building.

B. Use OF BUILDING COMMON AREAS. Tenant shall have the nonexclusive right to use
in common with other tenants in the Building, the Common Areas subject to the
Rules and Regulations which may be promulgated by Landlord from time to time
(the "Rules and Regulations").

C. RESERVATION. Landlord reserves the right from time to time without
unreasonable interferences with Tenant's _se:

     1. To install, use, maintain, repair and replace pipes, ducts, conduits,
     wires and appurtenant meters and equipment included in the Premises which
     are located in the Premises or located elsewhere outside the Premises, and
     to expand the Building; and

     2. To make changes, additions or deletions to the Common Areas, including,
     without limitation, changes in the location, size, shape and number of
     driveways, entrances, parking spaces, parking areas, loading and unloading
     areas, ingress, egress, direction of traffic, landscaped areas and
     hallways; and specifically but without limitation to modify the surface
     parking area; and

     3. To temporarily close any of the Common Areas for maintenance purposes so
     long as reasonable access to the Premises remains available; and

     4. To add additional building and improvements to the Common Areas; and

     5. To use the Common Areas while engaged in making additional improvements,
     repairs or alterations to the Building, or any portion thereof;

     6. To perform such other acts and make such other changes in, to or with
     respect to the Common Areas and the Building as Landlord may, in the
     exercise of sound business judgment, deem to be appropriate.

D. COMMENCEMENT DATE. The Lease Term shall be for the period designated in
Section 1, commencing on the _ate specified in Section 1, and ending on the
expiration of such period, unless the Lease Term shall be sooner

CENTRAL PLAZA LEASE-4

<PAGE>

terminated as provided in this Lease. The date upon which the Lease commences
shall be Commencement Date. Reference in this Lease to a "Lease Year" shall mean
each twelve month period commencing with the first day of the calendar month in
which the term of this Lease commences.

E. Option to Extend. IN THE EVENT TENANT IS NOT IN DEFAULT AND HAS NOT BEEN IN
DEFAULT AT ANY TIME DURING THE LEASE TERM OR THE PRECEDING EXTENSION THEREOF,
TENANT SHALL HAVE THE RIGHT TO EXTEND THE LEASE TERM FOR TWO PERIODS OF Five (5)
YEARS ON THE TERMS AND CONDITIONS SET FORTH HEREIN ("OPTION "). IN THE EVENT
TENANT WISHES TO EXERCISE ITS OPTION TO EXTEND, TENANT SHALL NOTIFY LANDLORD IN
WRITING NO LATER THAN NINETY (90) DAYS BEFORE THE EXPIRATION OF THE LEASE TERM.
IN THE EVENT TENANT PROVIDES SUCH NOTICE, AND IS NOT AND HAS NOT BEEN IN DEFAULT
AT ANY TIME DURING THE LEASE TERM THEN LANDLORD AND TENANT SHALL BE BOUND TO
EXTEND THE LEASE TERM FOR THE PREMISES ON THE SAME TERMS AND CONDITIONS OF THE
LEASE EXCEPT FOR:

     1.   THE LEASE TERM SHALL BE EXTENDABLE FOR AN ADDITIONAL TWO Five (5) YEAR
          TERMS; AND

     2.   THE BASE RENT FOR THE OPTION PERIOD SHALL BE NEGOTIATED. IN THE EVENT
          LANDLORD AND TENANT ARE UNABLE TO AGREE UPON A PROPER RENTAL FOR THE
          EXTENDED TERM, THEN EACH OF THE PARTIES HERETO SHALL APPOINT AN
          ARBITRATOR, AND IN CASE THE ARBITRATORS ARE UNABLE TO AGREE ON A
          PROPERTY RENTAL FOR THE EXTENDED TERM, THEY SHALL JOINTLY APPOINT A
          THIRD ARBITRATOR. IF THEY SHOULD BE UNABLE TO AGREE ON A THIRD
          ARBITRATOR, THEN THE THIRD ARBITRATOR SHALL BE APPOINTED BY THE
          PRESIDING JUDGE OF THE SUPERIOR COURT OF KITSAP COUNTY, WASHINGTON.
          THE DECISION OF ANY TWO SUCH ARBITRATORS SHALL BE BINDING UPON THE
          PARTIES HERETO. THE COSTS AND EXPENSES OF THE ARBITRATION PROCEEDING
          SHALL BE BORNE EQUALLY BY THE PARTIES, EXCEPT THAT EACH PARTY SHALL BE
          RESPONSIBLE FOR ITS OWN ATTORNEYS' FEES AND COSTS, UNLESS THE
          ARBITRATORS' AWARD IS OTHERWISE. IN NO EVENT SHALL THE BASE RENT BE
          LESS THAN THE BASE RENT FOR THE LAST YEAR OF THE INITIAL LEASE TERM.

F. TENANT'S RIGHT TO TERMINATE. In the event Tenant elects to terminate this
Lease in order to relocate at another location in Silverdale, which Tenant's
Board of Directors determines is a better place of business for Tenant, then in
that event, Tenant may terminate this Lease upon ninety (90) day's advance
written notice; provided, however, that in the event of such termination, all of
Tenant's leasehold improvements shall be removed at Tenant's sole expense and
the Premises shall be restored to their original condition, or better.

                                  3. POSSESSION

A. DELIVERY OF POSSESSION. Landlord shall deliver possession to Tenant on or
before the Commencement Date as set forth in Section 1.

B. TENANT IMPROVEMENTS. Tenant hereby acknowledges that Landlord has no
obligation to make improvements to the space prior to Tenant's occupancy. (See
Exhibit "D")

                                     4. RENT

A. BASE RENT. Tenant hereby covenants and agrees to pay Landlord as Base Rent
for the Premises the sum as provided in Section 1 above (subject to adjustment
as hereinafter provided), in advance, on the first day of each calendar month
from the Commencement Date. If the Lease Term commences or ends on any day other
than the first day of a calendar month, then the Base Rent for such month shall
be prorated. In addition to the Base Rent, _enant agrees to pay the Additional
Rent required by this Lease. All Rent shall be paid to LOUIS AND

CENTRAL PLAZA LEASE-5

<PAGE>

DELORES WEIR, P.O. Box 3650, Silverdale, WA 98383, without prior demand and
without any deduction or offset, in lawful money of the United States of
America, at the address of Landlord designated in Section 1 or to such other
person or at such other place as Landlord may from time to time designate in
writing.

B. LATE CHARGES AND INTEREST In the event Tenant fails to pay Rent within ten
(10) days of the date when due or in the event Tenant fails to make any other
payment for which Tenant is obligated under this Lease when due, the Tenant
shall pay to Landlord a late charge equal five percent (5%) of the amount due to
compensate Landlord for the extra costs incurred as a result of such late
payment. Additionally, all such delinquent Rent or other sums, plus late
charges, shall bear interest from the date due until paid, at the prime
commercial rate of interest in effect at the time such obligation becomes
delinquent as published from time to time by the Wall Street Journal, plus two
percent (2%). Any payments of any kind returned for insufficient funds will be
subject to an additional charge of $25.00. The provisions set forth herein shall
be in addition to and shall not limit Landlord's remedies in the event of
Tenant's failure to pay Rent.

C. DEFINITION. Any reference to "Rent" or "Rental" in this Lease shall mean both
Base Rent and Additional Rent as defined herein.

D. RECEIPT The amount of Four Thousand Two Hundred Fifty-Seven and no/100
Dollars ($4,257.00) is paid herewith to Landlord upon the execution of this
Lease, receipt of which is hereby acknowledged, which shall represent the first
month's rental.

E. ADJUSTMENTS. Base Rent shall increase by five percent (5%) each year.

                               5. ADDITIONAL RENT

A. DEFINITION. In addition to the Base Rent, Tenant shall pay Tenant's
Percentage of Additional Rent which shall be comprised of the Property Taxes and
Operating Expenses defined as follows:

     1. PROPERTY TAXES. The term "Property Taxes" shall include all real and
     personal property taxes, assessments, license fees, license tax, rental
     tax, levy, or tax on net income imposed by any governmental authority or
     agency on the Property and on all other improvements, fixtures, equipment
     and other property of Landlord located in or used in connection with the
     operation of the Property.

     2. OPERATING EXPENSES. The term "Operating Expenses" shall include the
     total amounts paid or payable by Landlord or others on behalf of Landlord
     in connection with the ownership, maintenance, repair and operation of the
     Building and the Property and shall include, but not be limited to the
     following: (A) total charges of any independent contractors employed in the
     care and operation, management, maintenance and repair of the Property
     and/or the Building; (B) cost of the fire alarm system; (C) landscaping;
     (D) trash removal; (E) the amount paid for all supplies, tools, equipment
     and necessities which are occasioned by every day wear and tear; (F) the
     cost of all utilities which are not separately metered including
     electricity, gas, water and sewer charges; (G) the amount paid for premiums
     of all insurance required from time to time by Landlord and Landlord's
     mortgagee and other items as are now or hereafter customarily included in
     the cost of managing, operating, maintaining, and repairing.

B. SEPARATELY METERED UTILITIES. Tenant shall be responsible for all separately
metered utilities and services.

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<PAGE>

C. HVAC. Landlord warrants that the HVAC system currently serving Tenant's
premises is in good repair and subject to a repair and maintenance contract.
Tenant shall pay their proportion of the repair and maintenance contract charges
as well as the cost of any other repairs incurred during each year as additional
rent, upon being billed therefor.

D. INTENT. The intent of this section is to require Tenant to pay its
proportionate share of the Property Taxes and Operating Expenses and is intended
to pass onto Tenant and cause to be reimbursed to Landlord all direct costs of
operating, repairing and managing the Property, Common Areas, Building, and the
Premises. Notwithstanding anything contained in this paragraph, the Rent payable
by Tenant shall in no event be less than the Base Rent.

E. RECEIPT. The amount of $958.00 is paid herewith to the Landlord upon the
execution of this Lease, receipt of which is hereby acknowledge, which shall
represent the additional rent for October, 2001.

F. SIGNAGE. Tenant shall pay Landlord $20.00 per month for rental of space on
directory sign along Silverdale Way. The amount of $20.00 is paid herewith to
the Landlord upon the execution of this Lease, receipt of which is hereby
acknowledged, which shall represent the signage rent for October, 2001.

G. ADJUSTMENTS. The additional rent for the term of this lease shall increase by
three percent (3%) each year regardless of the actual increase in property taxes
and operating expenses.

                               6. SECURITY DEPOSIT

Upon the execution of this Lease, Tenant shall deposit with Landlord the amount
of the security deposit ("Security Deposit") set forth in Section 1 in part as
security for the performance by Tenant of the provisions of this Lease. If
Tenant is in default, Landlord can use the security Deposit or any portion of it
to sure the default or to compensate Landlord for all damage sustained by
Landlord resulting from Tenant's default. Upon demand, Tenant shall immediately
pay to Landlord a sum equal to the portion of the Security Deposit expended or
applied by Landlord to maintain the Security Deposit in the amount initially
deposited with Landlord. If Tenant is not in default at the expiration or
termination of this Lease, Landlord shall return the entire Security Deposit to
Tenant. Landlord's obligations with respect to the deposit are those of a debtor
and not of a trustee, and Landlord can commingle the Security Deposit with
Landlord's general funds. Landlord is not required to pay Tenant interest on the
deposit. Landlord shall be entitled to immediately endorse and cash Tenant's
Security Deposit; however, such endorsement and cashing shall not constitute
Landlord's acceptance of this Lease. In the event Landlord does not accept this
Lease, Landlord shall return said Security Deposit to Tenant. Should Landlord
sell its interest in the Property during the Lease Term and if Landlord deposits
with the purchaser the Security Deposit deposited by Tenant, Landlord shall be
discharged from any further liability to Tenant with respect to the security
Deposit.

                                     7. USE

Tenant shall use the Premises for the purposes stated in Section 1 and shall not
use or permit the Premises to be used for any other purpose without the prior
written consent of Landlord. Tenant shall not use or occupy the Premises in
violation of law or of the Certificate of Occupancy issued for the Building, and
shall, upon written notice from Landlord, discontinue any use of the Premises
which is declared by any governmental authority having jurisdiction to be a
violation. Tenant shall not do or permit anything to be done in or about the
Premises which will in any way obstruct or interfere with the rights of other
tenants or occupants of the Building, or injure or annoy

CENTRAL PLAZA LEASE-7

<PAGE>

them, or use or allow the Premises to be used for any improper, immoral,
unlawful or objectionable purpose, nor __ hall Tenant cause, maintain or permit
any nuisance in, on or about the Premises. Tenant shall not commit or suffer to
be committed any waste in or upon the Premises and shall keep the Premises in a
"broom clean" condition. Tenant shall be responsible for all structural
engineering required to determine structural load. Additional restrictions and
regulation regarding Tenant's use of the Premises and Building shall be set
forth in the Rules and Regulations.

                                   8. NOTICES

Any notice required or permitted to be given hereunder must be in writing and
may be given by personal delivery or by mail, and if given by mail shall be
deemed sufficiently given if mailed by registered or certified mail addressed to
Tenant at the Building, or to Landlord at the address designated in Section 1.
Either party may specify a different address for notice purposes by written
notice to the other. The current address for notices are:

TO LANDLORD:             TO TENANT:

Louis and Delores Weir   Westsound Bank
PO Box 3650              Attn: David Johnson, CEO
Silverdale, WA 98383     190 Pacific Avenue
                         Bremerton, WA 98337

                                 9. HOLDING OVER

If Tenant holds over after the expiration or earlier termination of the Lease
Term without the express written consent of Landlord, Tenant shall become a
Tenant at sufferance only, at a rental rate equal to a Base Rent of one hundred
fifty percent (150%) of the Base Rent in effect upon the date of such expiration
and Additional Rent as calculated herein, prorated on a daily basis, and shall
be subject to the terms, covenants and conditions of this Lease. Acceptance by
Landlord of Rent after such expiration or earlier termination shall not result
in a renewal or extension of this Lease. The foregoing provisions of this
Section are in addition to and do not affect Landlord's rights specified herein
or any rights of Landlord provided by law for such holding over. If Tenant fails
to surrender the Premises upon the expiration of this Lease despite demand to do
so by Landlord, Tenant shall indemnify and hold Landlord harmless from all loss,
claim or damage Landlord incurs, including without limitation, a claim made by a
successor tenant for failure to provide possession of the Premises and any
attorney's fees and costs incurred by Landlord related thereto.

                         10. TAXES ON TENANT'S PROPERTY

Tenant shall be liable for and shall pay, at least ten (10) days before
delinquency, all taxes levied against any personal property or trade fixtures
placed by Tenant in or about the Premises. If any such taxes on Tenant's
personal property or trade fixtures are levied against Landlord or Landlord's
property or if the assessed value of the Premises is increased by the inclusion
therein of a value placed upon such personal property or trade fixtures of
Tenant and if Landlord, after written notice to Tenant, pays the taxes based
upon such increased assessment, which Landlord shall have the right to do
regardless of the validity thereof, but only under proper protest if requested
by Tenant, Tenant shall, upon demand, repay to Landlord the taxes so levied
against Landlord, or the portion of such taxes resulting from such increase in
the assessment.

CENTRAL PLAZA LEASE-8

<PAGE>

                            11. CONDITION OF PREMISES

A. REPRESENTATIONS. Tenant acknowledges that neither Landlord nor any agent of
Landlord has made any representation or warranty with respect to the Premises or
the Building or with respect to the suitability of either for the conduct of
Tenant's business.

B. ACCEPTANCE. The taking of possession of the Premises by Tenant shall
conclusively establish that the Premises and the Building were in satisfactory
condition at such time, subject to punch list items agreed to by Landlord and
Tenant in writing prior to Tenant's taking of possession.

C. LANDLORD'S OBLIGATION. Landlord's sole construction obligation under this
Lease shall be those obligations set forth in Exhibit "D."

                        12. ALTERATIONS AND IMPROVEMENTS

A. CONSTRUCTION OF IMPROVEMENTS. Tenant shall make no alterations, additions or
improvements in or to the Premises without Landlord's prior written consent, and
then only by contractors or mechanics approved by Landlord in writing. Tenant
shall submit to Landlord plans and specifications for any proposed alterations,
additions or improvements to the Premises, and Tenant may not make such
alterations, additions or improvements except in accordance with the plans and
specifications approved by Landlord, and shall not amend or modify such plans
and specifications without Landlord's prior written consent. Tenant agrees that
there shall be no construction of partitions or other improvements which might
interfere with Landlord's free access to mechanical installations or service
facilities of the Building or interfere with the moving of Landlord's equipment
to or from the enclosures containing said installations. All such work shall be
done at such times and in such manner as Landlord may from time to time
designate and also shall comply with all applicable provisions of this Lease and
the Rules and Regulations. Tenant covenants and agrees that all work done by
Tenant shall be performed in full compliance with all laws, rules, orders,
ordinances, regulations and requirements of all governmental agencies, offices
and boards having jurisdiction over the Premises. Before commencing any work,
Tenant shall give Landlord at least ten (10) days written notice of the proposed
commencement of such work and shall, if required by Landlord, secure at Tenant's
own cost and expense, a completion and lien indemnity bond satisfactory to
Landlord for said work. Tenant further covenants and agrees that any liens filed
against the Property, the Premises, or the Building for work claimed to have
been done for or materials claimed to have been furnished to Tenant, will be
discharged by Tenant, by bond or otherwise, within ten (10) days after the
filing thereof, at the cost and expense of Tenant. All alterations, additions or
improvements upon the Premises shall become the property of Landlord, and shall
remain upon, and be surrendered with the Premises as a part thereof, at the end
of the Lease Term.

B. REMOVAL OF TENANT'S PROPERTY. All articles of personal property and all
business and trade fixtures, machinery and equipment, furniture and movable
partitions owned by Tenant or installed by Tenant at its expense in the Premises
shall be and remain the property of Tenant and may be removed by Tenant at any
time during the Lease Term as long as: (I) such removal is made prior to the
expiration of the Lease Term; (II) Tenant immediately repairs all damage caused
by or resulting from such removal; and (III) Tenant is not in default hereunder.
Such installation, location and movement shall further be subject to the Rules
and Regulations. If Tenant shall fail to remove all of its personal property
fixtures from the Premises upon termination of this Lease for any cause
whatsoever, Landlord may, at its option, remove the same in manner that Landlord
shall choose, and store said effects without liability to Tenant for loss
thereof. In such event, Tenant agrees to pay Landlord upon demand any and all
expenses incurred in such removal, including court costs and attorney's fees and
storage charges no such

CENTRAL PLAZA LEASE-9

<PAGE>

effects, for any length of time that the same shall be in Landlord's possession.
If Tenant fails to pay for the cost of said storage after it has been stored
for a period of thirty (30) days or more, Landlord may, at its option, sell said
effects, or any of the same at private sale and without legal process, for such
price as Landlord may obtain and apply the proceeds of such sale upon any
amounts due under this Lease, including but not limited to the costs associated
with the sale of the personal property and fixtures.

                                   13. REPAIRS

A. TENANT'S OBLIGATION. By entry hereunder, Tenant accepts the Premises as being
in good and sanitary order, condition and repair. Tenant shall keep, maintain
and preserve the Premises in the same condition as it was when delivered to
Tenant and shall, at Tenant's sole cost and expense, make all repairs to the
Premises which repairs shall be made in accordance with this Lease. Tenant
shall, upon the expiration of the Lease Term surrender the Premises to Landlord
in the same condition as when received, usual and ordinary wear and tear or
damage caused by insured casualty excepted. Landlord shall have no obligation to
alter, remodel, improve, repair, decorate or paint the Premises or any part
thereof. The parties hereto affirm that Landlord has made no representations to
Tenant respecting the condition of the Property, the Common Areas, the Premises,
or the Building. Tenant shall not be responsible for any expense nor required to
make any repairs or replacements which may be necessary as a result of damage or
destruction caused solely by Landlord's negligence or default.

                                    14. LIENS

Tenant shall not permit any mechanics', materialmen's or other liens to be filed
against the Property, the Building or against Tenant's leasehold interest in the
Premises. If any such liens are filed, Tenant shall have ten (10) days from the
date of such filing in which to either remove such liens or to provide a bond
indemnifying Landlord from and removing said lien in the amount of one hundred
twenty-five percent (125%) of the claimed lien amount. If Tenant fails to take
such measures in the time allowed, Landlord may, without waiving any of its
rights and remedies based on such breach of Tenant and without releasing Tenant
from any of its obligations, cause such liens to be released by any means it
shall deem proper, including payments in satisfaction of the claim giving rise
to such lien. Tenant shall pay to Landlord at once, upon notice by Landlord, any
sum paid by Landlord to remove such liens, together with interest at a rate
equal to the prime commercial rate of interest in effect at the time such
obligation is paid by Landlord as published from time to time by the Wall Street
Journal, plus two percent (2%) which interest rate shall apply from the date of
such payment by Landlord.

                              15. ENTRY BY LANDLORD

Landlord reserves and shall have the right to enter the Premises at reasonable
times and in a reasonable manner to: (A) inspect the same; (B) to show the
Premises to prospective purchasers or tenants; (C) to alter, improve or repair
the Premises or any other portion of the Building, without being deemed guilty
of any eviction of Tenant and without abatement of Rent. Tenant hereby waives
any claim for damages for any injury or inconvenience to or interference with
Tenant's business, any loss of occupancy or quiet enjoyment of the Premises, and
any other loss in, upon and about the Premises except to the extent such damages
or loss result solely from the negligence or willful misconduct of Landlord, its
agents or employees. Landlord shall have the right to use and all means which
Landlord may deem proper to open door and to enter the Premises in an emergency.
Any such entry to the Premises by Landlord by any means shall not be construed
or deemed to be a forcible or unlawful entry into the Premises, or an eviction
of Tenant from the Premises or any portion thereof, and any damages caused on
account thereof shall be paid by Tenant. It is understood and agreed that no
provision of this Lease shall be construed as

CENTRAL PLAZA LEASE-10

<PAGE>

obligating Landlord to perform any repairs, alterations or improvements except
as otherwise expressly agreed herein by Landlord.

                           16. UTILITIES AND SERVICES

Tenant hereby acknowledges that Landlord has provided Tenant electricity for
normal lighting and fractional horsepower office machines, utilities and heat
separately metered to the Premises. Landlord shall furnish light to Common
Areas. The failure of such service if caused by (A) accident, breakage or
repairs; (B) strikes, lockouts or other labor disturbance or labor dispute of
any character; (C) governmental regulation, moratorium or other governmental
action; (D) inability despite the exercise of reasonable diligence or obtain
electricity, water or fuel; or by (E) any other cause beyond Landlord's
reasonable control, shall not result in any liability to Landlord. In addition,
Tenant shall not be entitled to any abatement or reduction of Rent by reason of
such failure, and no eviction of Tenant shall result from such failure.

                                 17. BANKRUPTCY

If Tenant shall file a petition in bankruptcy under any provision of the
bankruptcy Code as then in effect, or if Tenant shall be adjudicated a bankrupt
in involuntary bankruptcy proceedings and such adjudication shall not have been
vacated within sixty (60) days from the date thereof, or if a receiver or
trustee shall be appointed for Tenant's property and the order appointing such
receiver or trustee shall not be set aside or vacated within sixty (60) days
after the entry thereof, or if Tenant shall assign Tenant's estate or effects
for the benefit of creditors, or if this Lease shall, by operation of law or
otherwise, pass to any person or persons other than Tenant without the prior
written consent of Landlord, then in any such event Landlord may terminate this
Lease, if Landlord so elects, with or without notice of such election and with
or without entry or action by Landlord.

                         18. INDEMNIFICATION OF LANDLORD

A. TENANT'S INDEMNIFICATION. Subject to the Section, Tenant shall indemnify,
defend and hold Landlord, its trustees, general partners, limited partners,
agents, employees or contractors, harmless from all claims (1) arising from
Tenant's use of the Premises; (2) arising from the conduct of Tenant's business
or from any activity, work or thing done, permitted or suffered by Tenant in or
about the Premises, the Property, the Building or the Common Areas and (3)
arising from the act, omission, or negligence of any agent, employee, sublessee,
licensee or invitee of Tenant, in or about the Property, the Premises, Building
or the Common Areas. Tenant shall further indemnify, defend and hold Landlord,
its trustees, general partners, limited partners, agents, employees or
contractors, harmless from all claims arising from any breach or default in the
performance of any obligation to be performed by Tenant under the terms of this
Lease including Tenant's obligation to comply with the Rules and Regulations and
Covenants, Conditions and Restrictions and from and against all costs,
attorneys' fees, expenses and liabilities incurred in connection with any claim
or any action or proceeding which is brought against Landlord, its trustees,
general partners, limited partners, agents, employees or contractors. In case
any action or proceeding shall be brought against Landlord by reason of any such
claim, Tenant, upon notice from Landlord, shall defend the same at Tenant's
expense by counsel approved in writing by Landlord. Tenant, as a material part
of the consideration to Landlord, hereby assumes all risk of damage to property
or injury to persons in, upon or about the Property, Premises, Building, or the
Common Areas from any cause whatsoever except that which is caused by the
failure of landlord, its general partners, limited partners, agents, employees
or contractors, to observe any of the terms and

CENTRAL PLAZA LEASE-11

<PAGE>

conditions of this Lease where such failure has persisted for an unreasonable
period of time after written notice of such failure to Landlord. Tenant hereby
waives all its claims in respect thereof against Landlord, its general partners,
limited partners, agents, employees or contractors.

B. LIMITATION. Notwithstanding this Section, in the event of concurrent
negligence of Tenant, its agents, employees, sublessees, invitees, licensees or
contractors on the one hand, and that of Landlord, its trustees, general
partners, limited partners, agents, employees, or contractors on the other hand,
which concurrent negligence results in injury or damage to persons or property
and relates to the construction, alteration, repair, addition to, subtraction
from, improvement to or maintenance of the Property, the Premises, Common Areas,
or the Building, Tenant's obligation to indemnify Landlord as set forth in this
Section shall be limited to the extent of Tenant's negligence, and that of its
agents, employees, sublessees, invitees, licensees or contractors, including
Tenant's proportional share of costs, attorneys' fees and expenses incurred in
connection with any claim, action or proceeding brought with respect to such
injury or damage.

C. EXCEPTION. Neither Landlord nor its trustees, general partners, limited
partners, agents, employees or contractors of Landlord shall be liable (1) for
any such damage caused by other Tenants or persons in or about the Building; or
(2) caused by public or quasi-public work; or (3) for consequential damages
arising out of any loss of the use of the Premises of any equipment or
facilities therein by Tenant or any person claiming through or under Tenant;
except to the extent caused solely by the gross negligence or willful misconduct
of Landlord.

                         19. DAMAGE TO TENANT'S PROPERTY

Notwithstanding the provisions of the preceding Section to the contrary (except
in the event of concurrent negligence by Landlord and Tenant as governed above),
Landlord, its trustees, general partners, limited partners, agents, employees or
contractors, shall not be liable for (A) any damage to any property entrusted to
employees of the Building, (B) loss or damage to any property by theft or
otherwise, or (C) any injury or damage to persons or property resulting from
fire, earthquake, explosion, falling plaster, steam, gas, electricity, water or
rain which may leak from any part of the Building or from the pipes, appliances
or plumbing work therein or from the roof, street or sub-surface or from any
other place or resulting from dampness or any other cause whatsoever. Landlord,
its trustees, general partners, limited partners, agents, employees or
contractors, shall not be liable for interference with light or other
incorporeal hereditaments, nor shall Landlord, its trustees, general partners,
limited partners, agents, employees or contractors, be liable for any latent
defect in the Premises or in the Building. Tenant shall give prompt notice to
Landlord in case of fire or accidents in the Premises or in the Building or
defects therein or in the fixtures or equipment.

                                  20. INSURANCE

A. TENANT'S INSURANCE. tenant shall, during the term hereof and any other period
of occupancy, at its sole cost and expense, keep in full force and effect the
following insurance:

     1. Standard form property insurance insuring against the perils of fire,
     extended coverage, vandalism, malicious mischief, special extended coverage
     ("All-Risk") glass coverage and sprinkler leakage. This insurance policy
     shall be upon all property owned by Tenant, for which Tenant is legally
     liable or that was installed at Tenant's expense, and which is located in
     the Building including, without limitation, furniture, fittings,
     installations, fixtures (other than Tenant Improvements installed by
     Landlord), and any other personal property, in an amount not less than
     ninety percent (90%) of the full replacement cost thereof. In

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<PAGE>

     the event that there shall be a dispute as to the amount which comprises
     full replacement cost, the decision of Landlord or any Mortgagees of
     Landlord as defined in this Lease shall be conclusive. This insurance
     policy shall also be upon direct or indirect loss of Tenant's earnings
     attributable to Tenant's inability to use fully or obtain access to the
     Premises or Building in an amount as will properly reimburse Tenant. Such
     policy shall name Landlord and any Mortgagees of Landlord as insured
     parties, as their respective interests may appear;

     2. Comprehensive General Liability Insurance insuring Tenant against any
     liability arising out of the lease, use, occupancy or maintenance of the
     Premises and all areas appurtenant thereto, Such insurance shall be in the
     amount of at least $1,000,000 Combined Single Limit for Injury to, or death
     of one or more persons in an occurrence, and for damage to tangible
     property (including loss of use) in an occurrence, such liability amount
     may be adjusted by Landlord from time to time upon written notice to
     Tenant. The Policy shall insure the hazards of the Premises and Tenant's
     operations thereon, independent contractors, contractual liability
     (covering the indemnity contained in Section 18 hereof) and shall: (A) name
     Landlord as an additional insured; (B) contain a cross liability provision;
     and (C) contain a provision that the insurance provided by the Tenant
     hereunder shall be primary and that other insurance available to the
     Landlord shall be non-contributing;

     3. Workers' Compensation and Employer's Liability insurance as required by
     law;

     4. Any other form or forms of insurance as Tenant or Landlord or any
     Mortgagees of Landlord may reasonably require from time to time in order to
     protect Landlord, other tenants of the Building, or any mortgagee of
     Landlord, or if required by law or regulation.

B. FORM. All insurance policies shall be written in a form and with an insurance
company reasonably satisfactory to Landlord. Within ten (10) days after Tenant
takes possession of the Premises, Tenant shall deliver to Landlord copies of
policies or certificates evidencing the existence of the amounts and forms of
coverage required by this Lease. Tenant shall, within ten (10) days prior to the
expiration of such policies, furnish Landlord with renewals or "binders"
thereof, or Landlord may order such insurance and charge the cost thereof to
Tenant as Additional Rent. If Landlord obtains any insurance that is the
responsibility of Tenant under this Section, Landlord shall deliver to Tenant a
written statement setting forth the cost of any such insurance and showing in
reasonable detail the manner in which it has been computed.

C. LANDLORD'S INSURANCE. During the Lease Term, Landlord shall insure the
Building (excluding any property which Tenant is obligated to insure) against
damage with fire and other forms of physical damage insurance as well as public
liability insurance, all in such amounts and with such deductibles as Landlord
considers appropriate. Landlord may, but shall not be obligated to, obtain and
carry any other form or forms of insurance as it or Landlord's Mortgagees may
determine advisable. Notwithstanding any contribution by Tenant to the cost of
insurance premiums, as provided herein, Tenant acknowledges that it has no right
to receive any proceeds from any insurance policies carried by Landlord.

D. DUTY OF TENANT. Tenant will not keep, use, sell or offer for sale in or upon
the Premises any article which may be prohibited by any insurance policy
periodically in force covering the Building. If Tenant's occupancy, use, or
business in, or on the Premises, whether or not Landlord has consented to the
same, result sin any increase in premiums for the insurance periodically carried
by Landlord with respect to the Building, tenant shall pay any such increase
in premiums as Additional Rent within ten (10) days after being billed therefore
by Landlord. In

CENTRAL PLAZA LEASE-13

<PAGE>

determining whether increased premiums are a result of Tenant's use of the
Premises, a schedule issued by the organization computing the insurance rate on
the Building or the Tenant Improvements showing the various components of such
rate, shall be conclusive evidence of the several items and charges which make
up such rate. Tenant shall promptly comply with all reasonable requirements of
any present or future insurer relating the Premises.

E. CANCELLATION. If any of Landlord's insurance policies shall be canceled or
cancellation shall be threatened or the coverage thereunder reduced or
threatened to be reduced in any way because of the use of the Premises or any
part thereof by Tenant, its agents, employees, agents or invitees or any
assignee or sublessee of Tenant or by anyone Tenant permits on the Premises and,
if Tenant fails to remedy the condition giving rise to such cancellation,
threatened cancellation, reduction of coverage, threatened reduction of
coverage, increase in premiums, or threatened increase in premiums, within
forty-eight (48) hours after notice thereof, Landlord may, at its option, either
terminate this Lease or enter upon the Premises and attempt to remedy such
condition, and Tenant shall promptly pay the costs thereof to Landlord as
Additional Rent. In such event, Landlord shall not be liable for any damage or
injury caused to any property of Tenant or of others and Landlord shall have all
of the remedies provided for in this Lease in the event of a default by Tenant.
Notwithstanding the foregoing provisions of this Section, if Tenant fails to
remedy as aforesaid, Tenant shall be in default of its obligation hereunder and
Landlord shall have no obligation to remedy such default.

F. SUBROGATION. All policies of insurance required hereunder shall include a
clause or endorsement denying the insurer any rights of subrogation against the
other party to the extent rights have been waived by the insured before the
occurrence of injury or loss. Landlord and Tenant waive any rights of recovery
against the other for injury or loss due to hazards covered by policies of
insurance containing such a waiver of subrogation clause or endorsement to the
extent of the injury or loss covered thereby.

                            21. DAMAGE OR DESTRUCTION

A. TOTAL DESTRUCTION. In the event of the total destruction of the Premises
and/or the Building (Defined as destruction equal to or exceeding 25% of the
full insurable value of the Premises and/or Building, Landlord shall, at
Landlord's sole option, either commence repair, reconstruction and restoration
of the Building and/or the Premises as soon as reasonably possible and prosecute
the same diligently to completion, in which event this Lease shall remain in
full force and effect; or, within sixty (60) days after such destruction, elect
not to so repair, reconstruct or restore the Building and/or the Premises, in
which event this Lease shall terminate. In either event, Landlord shall give
Tenant written notice of its intention within said sixty (60) day period. In the
event Landlord elects not to restore the Building and/or the Premises, this
Lease shall be deemed to have terminated as of the date of such total
destruction.

B. PARTIAL DESTRUCTION. In the event of a partial destruction of the Building
and/or the Premises (defined as destruction of less than twenty-five percent
(25%) of the full insurable value of the Premises and/or Building) and if the
damage thereto is such that the Building and/or the Premises may be repaired,
reconstructed or restored within a period of ninety (90) days from the date of
the happening of such a casualty, and if Landlord will receive insurance
proceeds sufficient to cover the cost of all such repairs, then Landlord shall
commence and proceed diligently with the work of repair, reconstruction and
restoration and this Lease shall continue in full force and effect. If such work
of repair, reconstruction and restoration shall require a period longer than
ninety (90) days or if Landlord will not receive insurance proceeds sufficient
to cover the cost of all such repairs, then Landlord either may elect to so
repair, reconstruct or restore and the Lease shall continue in full force and
effect or Landlord may

CENTRAL PLAZA LEASE-14

<PAGE>

elect not to repair, reconstruct or restore and the Lease shall then terminate.
Under any of the conditions of this Section, Landlord shall give written
notice to Tenant of its intention within sixty (60) days of the partial
destruction. In the event Landlord elects not to restore the Common Areas and/or
the Premises, this Lease shall be deemed to have terminated as of the date of
such partial destruction.

C. TERMINATION. Upon any termination pursuant to the terms of this Paragraph 21,
the parties shall be released without further obligation to the other from the
date possession of the Premises is surrendered to Landlord except for items
which have therefore accrued and are then unpaid. Notwithstanding the provisions
of Sections 21 A and B above, if total or partial destruction is due to any
cause other than fire or other peril covered by extended coverage insurance,
Landlord may elect to terminate this Lease.

D. ABATEMENT. In the event of repair, reconstruction and/or restoration by
Landlord as herein provided, the Rental payable under this Lease shall be abated
proportionately with the degree to which Tenant's use of the Premises is
impaired during the period of such repair, reconstruction or restoration;
provided that there shall be no abatement of Rent if such damage is the result
of Tenant's act, omission or negligence of that of its agents, employees,
sublessee, invitee, or licensees. In the event of concurrent negligence,
Tenant's Rent shall be abated proportionately in an amount equal to the extent
Tenant is not negligent. Tenant shall not be entitled to any compensation or
damages for loss in the use of the whole or any part of the Premises and/or any
inconvenience or annoyance occasioned by such damage, repair, reconstruction or
restoration.

E. DELAYS. Tenant shall not be released from any of its obligations under this
Lease except to the extent and upon the conditions expressly stated in this
Section. Notwithstanding anything to the contrary contained this Section, if
Landlord is delayed or prevented from repairing or restoring the damaged
Building, Common Areas and/or Premises within ninety (90) days after the
occurrence of such damage or destruction by reason of acts of God, war
governmental restrictions, inability to procure the necessary labor or
materials, or other cause beyond the reasonable control of Landlord, Landlord
may terminate this Lease, whereupon Landlord shall be relieved of its obligation
to make such repairs or restoration and Tenant shall be released from its
obligations under this Lease as of the end of said ninety (90) day period.

F. EXTENT. If Landlord is obligated to or elects to repair or restore as herein
provided, Landlord shall be obligated to make repair or restoration only of
those portions of the Building, Common Areas and/or the Premises which were
originally provided at Landlord's expense, and the repair and restoration of
items not provided at Landlord's expense shall be the obligation of Tenant.
Landlord shall perform repairs in a timely and workmanlike manner.

G. WAIVER. Landlord and Tenant hereby waive the provisions of any statutes or
court decisions which relate to the abatement or termination of leases when
leased property is damaged or destroyed and agree that such event shall be
exclusively governed by the terms of this Lease.

                               22. EMINENT DOMAIN

In case all of the Property, the Premises, Building, or such part thereof as
shall substantially interfere with either Landlord's or Tenant's use and
occupancy thereof, shall be taken for any public or quasi-public purpose by any
lawful power or authority by exercise of the right of appropriation,
condemnation or eminent domain, or sold to prevent such taking, either party
shall have the right to terminate this Lease effective as of the date possession
is required to be surrendered to said taking authority. Also if Landlord
determines, in the event of a taking of all or a part of the Common Areas that
any such taking will prohibit or inhibit ingress or egress to the Premises or
the

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<PAGE>

Building, or will interfere with parking in the Building or areas necessary for
or to operation of the Building, Landlord shall have the right to terminate this
Lease effective as of the date possession is required to be surrendered to said
taking authority. Tenant shall not assert any claim against Landlord for any
compensation because of such taking, and Landlord shall be entitled to receive
the entire amount of any award resulting from said taking without deduction for
any estate or interest of Tenant. In the event the amount of property and type
of estate taken shall not substantially interfere with the conduct of Tenant's
business, or, with respect to the Common Areas, Landlord determines it will not
interfere with ingress and egress to the Building, parking or areas necessary to
the operation of the Building and Landlord determines in its sole discretion
Landlord is economically able to restore the Premises and/or the Building to an
operating entity comparable to that which existed prior to the taking, Landlord
shall restore the area affected by the taking. If a portion of the premises was
affected by such taking, a proportionate allowance shall be made to Tenant for
the Rent corresponding to the time during which, and to the part of the Premises
which Tenant shall be so deprived on account of such taking and restoration.
Tenant shall not have the right to make a separate claim with the condemning
authority for the value of Tenant's property and leasehold interest and/or
moving and relocation expenses.

                            23. DEFAULTS AND REMEDIES

A. EVENTS OF DEFAULT. The occurrence of any one or more of the following events
shall constitute a default hereunder by Tenant:

     1. The vacation or abandonment of the Premises by Tenant. Abandonment and
     vacation are herein defined to include, but are not limited to an absence
     by Tenant from the premises for ten (10) successive business days or
     longer;

     2. The failure by Tenant to pay Rent, Additional rent or make any other
     payment required to be made by Tenant hereunder, within ten (10) days of
     written notice of the date when due;

     3. The failure by Tenant to observe or perform any of the express or
     implied covenants or provisions of this Lease and Rules and Regulations to
     be observed or performed by Tenant, where such failure shall continue for a
     period often (10) days after written notice thereof from Landlord to
     Tenant. If the nature of Tenant's default is such that more than ten (10)
     days are reasonably required, in the Landlord's sole discretion, for its
     cure, then Tenant shall not be deemed to be in default if Tenant shall
     commence such cure within said ten (10) day period and thereafter
     diligently prosecute such cure to completion, which completion shall occur
     not later than sixty (60) days from the date of such notice from Landlord;

     4. (A) The making by Tenant of any general assignment for the benefit of
     creditors; (B) the filing by or against Tenant of a petition to have Tenant
     adjudged a bankrupt or a petition for reorganization or arrangement under
     any law relating to bankruptcy (unless, in the case of a petition filed
     against Tenant, the same is dismissed within sixty (60) days; (C) the
     attachment, execution or other judicial seizure of substantially all of
     Tenant's assets located at the Premises of Tenant's interest in this Lease
     where such seizure is not discharged within thirty (30) days; or (D) the
     appointment of a receiver for Tenant or any of Tenant's assets;

B. REMEDIES. In the event of any such default by Tenant, in addition to any
other remedies available to Landlord at law or in equity, Landlord shall have
the immediate option to re-enter the Premises as set out in paragraph C
hereafter. In the event of such re-entry, Landlord may recover from Tenant:

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<PAGE>

     1. Any unpaid Rent which had been earned at the time of such termination;
     plus

     2. The amount of unpaid Rent for the balance of the Lease Term; plus

     3. Any other amount necessary to compensate Landlord for all the detriment
     proximately caused by Tenant's failure to perform Tenant's obligations
     under this lease.

C. RE-ENTRY. In the event of any such default by Tenant, Landlord shall also
have the right, without notice, with or without terminating this Lease, to
re-enter the Premises and remove all persons and property from the Premises;
such property may be removed and stored in a public warehouse or elsewhere at
the cost of and for the account of Tenant. No re-entry or taking possession of
the Premises by Landlord pursuant to this Section shall be construed as an
election to terminate this Lease unless a written notice of such intention is
given to Tenant or unless the termination thereof is decreed by a court of
competent jurisdiction.

D. ABANDONMENT. In the event of the vacation or abandonment of the Premises by
Tenant or in the event that Landlord shall elect to re-enter as provided in
Section 23C above or shall take possession of the Premises pursuant to legal
proceeding or pursuant to any notice provided by law, then if Landlord does not
elect to terminate this Lease as provided above, Landlord may from time to time,
without terminating this Lease, either recover all Rent as it becomes due or
re-let the Premises or any part thereof for the term of this Lease on terms and
conditions as Landlord in its sole discretion may deem advisable with the right
to make alterations and repairs to the Premises.

E. RELETTING. In the event that Landlord shall elect to so re-let, then Rentals
received by Landlord from such reletting shall be applied first, to the payment
of any indebtedness other than Rent due hereunder from Tenant to Landlord;
second, to the payment of any cost of such re-letting; third, to the payment of
the cost of any alterations and repairs to the Premises; fourth, to the payment
of Rent due and unpaid hereunder and the residue, if any, shall be held by
Landlord and applied to payment of future Rent as the same may become due and
payable hereunder. Should the portion of such Rentals received from such
re-letting during any month, which is applied to the payment of Rent hereunder,
be less than the Rent payable during that month by Tenant hereunder, then Tenant
shall pay such deficiency to Landlord immediately upon demand therefore by
Landlord.

F. CUMULATIVE REMEDIES. All rights, options and remedies of Landlord contained
in this Lease shall be construed and held to be cumulative, and no one of them
shall be exclusive of the other, and landlord shall have the right to pursue any
one or all of such remedies or any other remedy or relief which may be provided
by law, whether or not stated in this Lease.

                          24. ASSIGNMENT AND SUBLETTING

Tenant shall not voluntarily or involuntarily assign, encumber, hypothecate,
sublease all or any part of the Premises or otherwise transfer (hereinafter
collectively referred to as "Assignment") its interest in this Lease or in the
Premises, without first obtaining Landlord's prior written consent which consent
may not be unreasonably withheld. An assignment shall not release Tenant from
any obligations hereunder. Except as specified herein, any Assignment without
Landlord's prior consent, shall be voidable at Landlord's election and shall
constitute a default. Except as specified herein, if Tenant is a corporation,
any transfer of this Lease from Tenant by merger, consolidation or liquidation,
or any change in the ownership of the corporation, shall constitute an
Assignment for the purposes of this Section. If Tenant is a partnership, any
transfer of this Lease by dissolution, or any change in

CENTRAL PLAZA LEASE-17

<PAGE>

the ownership of the Partnership, shall constitute an Assignment for the
purposes of this Section. No consent to an Assignment shall constitute a further
waiver of the provisions of this Section.

                                25. SUBORDINATION

A. Without the necessity of any additional document being executed by Tenant for
the purpose of effective subordination, and at the election of Landlord or any
Mortgagee, This Lease shall be subject and subordinate at all times to:

     1. All ground leases or underlying leases which may now exist or hereafter
     be executed affecting the Building or the Property upon which the Building
     is situated or both;

     2. The lien of any Mortgage or Deed of Trust which may now exist or
     hereafter be executed in any amount for which the Building, Property,
     underlying leases, or Landlord's interest or estate in any of said items is
     specified as security.

B. Notwithstanding the foregoing, Landlord shall have the right to subordinate
or cause to be subordinated any such ground Leases or underlying leases or any
such liens to this Lease. In the event that any mortgage is foreclosed or a
conveyance in lieu of foreclosure is made for any reason. Tenant shall,
notwithstanding any subordination, attorn to and become the Tenant of the
successor-in-interest to Landlord, at the option of such successor-in-interest.
Tenant covenants and agrees to execute and deliver, upon demand by Landlord and
in the form requested by Landlord, any additional documents evidencing the
priority of subordination of this Lease with respect to any such underlying
leases or the lien of any such Mortgage. Should Tenant fail to sign and return
any such documents within twenty (20) business days of request, Tenant shall be
in default, and Landlord may, at Landlord's option, terminate this Lease
provided written notice of such termination is received by Tenant prior to
Landlord's receipt of such documents executed by Tenant. Tenant hereby
irrevocably appoints Landlord as attorney-in-fact of Tenant to execute, deliver
and record any such documents in the name and on behalf of the Tenant.

C. In the event of any such subordination of this Lease, Tenant's possession of
the Premises shall remain undisturbed and Tenant's rights under this Lease shall
be recognized and shall not be adversely affected so long as Tenant is not in
default under this Lease.

                            26. ESTOPPEL CERTIFICATES

A. Within ten (10) days following any written request which Landlord may make
from time to time, Tenant shall execute and deliver to Landlord a statement
certifying: (I) the Commencement Date of this Lease; (II) the fact that this
Lease is unmodified and in full force and effect (or, if there have been
modifications hereto, that this Lease is in full force and effect, and stating
the date and nature of such modifications); (III) the date to which the Rent and
other sums payable under this Lease have been paid; (IV) that there are no
current defaults under this Lease by either Landlord or Tenant except as
specified in Tenant's statement; and (V) such other matters as are reasonably
requested by Landlord. Landlord and Tenant intend that any statement delivered
pursuant to this Section may be relied upon by any Mortgagee, ground lessor,
purchaser or prospective purchaser of the Building, the Property or any interest
therein.

B. Tenant's failure to deliver such statement within such time shall be
conclusive upon Tenant (i) that this Lease is

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<PAGE>

in full force and effect, without modification except as may be represented by
Landlord (II) that there are no uncured defaults in Landlord's performance; and
(III) that not more than one (1) month's Rental has been paid in advance, and
Tenant hereby irrevocably appoints Landlord as attorney-in-fact of Tenant to
execute, deliver and record estoppel certificates in the name and on behalf of
Tenant.

                               27. HAZARDOUS WASTE

A. PRESENCE AND USE OF HAZARDOUS SUBSTANCES. Tenant shall not, without
Landlord's prior written consent, keep on or around the Project, Property,
Premises, Common Areas or Building, for use, disposal, treatment transportation,
generation, storage or sale or any other purpose, any substances designated as,
or containing components designated as hazardous, dangerous, infectious, toxic
or harmful (collectively referred to as "Hazardous Substances") and/or is
subject to regulation by any federal state or local law, regulation, statute or
ordinance. With respect to any such Hazardous Substance, Tenant shall:

     1. Comply promptly, timely, and completely with all governmental
     requirements for reporting, keeping and submitting manifests, and obtaining
     and keeping current identification numbers;

     2. Submit to Landlord true and correct copies of all reports, manifests and
     identification numbers at the same time as they are required to be and/or
     are submitted to the appropriate governmental authorities;

     3. Within five (5) days of Landlord's request, submit written reports to
     Landlord regarding Tenant's use, storage, treatment, transportation,
     generation, disposal or sale of Hazardous Substances and provide evidence
     satisfactory to Landlord of Tenant's compliance with the applicable
     government regulations;

     4. Allow Landlord or Landlord's agent or representative to come on the
     Premises at all times to check Tenant's compliance with all applicable
     governmental regulations regarding Hazardous Substances;

     5. Comply with minimum levels, standards or other performance standards or
     requirements which may be set forth or established for certain Hazardous
     Substances (if minimum standards or levels are applicable to Hazardous
     Substances present on the premises, such levels or standards shall be
     established by an on-site inspection by the appropriate governmental
     authorities and shall be set forth in an Addendum to the Lease); and

     6. Comply with all applicable governmental rules, regulations and
     requirements regarding the proper and lawful use, sale, transportation,
     generation, storage, treatment, and disposal of Hazardous Substances. Any
     and all costs incurred by Landlord and associated with any violation of
     said governmental rules, regulations, or requirements by Tenant shall be
     paid by Tenant as additional rent and shall be due and payable immediately
     upon demand by Landlord.

B. CLEANUP COSTS, DEFAULT AND INDEMNIFICATION.

     1. Tenant shall be fully and completely liable to Landlord for any and all
     cleanup costs, and any and all other charges, fees, penalties (civil and
     criminal) imposed by any governmental authority with respect to Tenant's
     use, disposal, storage, transportation, generation and/or sale of Hazardous
     Substances, in or about the Project, Property, Premises, Common Areas or
     Building.

CENTRAL PLAZA LEASE-19

<PAGE>

     2. Tenant shall indemnify, defend and save Landlord harmless from any and
     all of the costs, fees, penalties and charges assessed against or imposed
     upon Landlord (as well as Landlord's attorney's fees and costs) as a result
     of Tenant's use, disposal, transportation, generation and/or sale of
     Hazardous Substances.

     3. Upon Tenant's default under this Section in addition to the rights and
     remedies set forth elsewhere in this Lease, Landlord shall be entitled to
     the following rights and remedies:

          A. At Landlord's option, to terminate this Lease immediately; and/or

          B. To recover any and all damages associated with the default,
          including, but not limited to cleanup costs and charges, civil and
          criminal penalties and fees, loss of business and sales by Landlord
          and other tenants of the Building or Project, any and all damages and
          claims asserted by third parties and Landlord's attorney's fees and
          costs.

                            28. RULES AND REGULATIONS

Tenant shall faithfully observe and comply with the reasonable Rules and
Regulations which may be promulgated by Landlord from time to time. Landlord
shall not be responsible to Tenant for the violation or non-performance by any
other tenant or occupant of the Building of any of said Rules and Regulations.

                              29. CONFLICT OF LAWS

This Lease shall be governed by and construed pursuant to the laws of the State
of Washington. Exclusive venue and jurisdiction of any dispute arising out of
or relating to the lease, or Tenant's use and/or occupancy of the Premises,
shall be in the State and Federal Courts located in Kitsap County, Washington.

                           30. SUCCESSORS AND ASSIGNS

Except as otherwise provided in this Lease, all of the covenants, conditions and
provisions of this Lease shall be binding upon and shall inure to the benefit of
the parties hereto and their respective heirs, personal representatives,
successors and assigns.

                            31. SURRENDER OF PREMISES

The voluntary or other surrender of this Lease by Tenant, or a mutual
cancellation thereof, shall not work a merger, and shall, at the option of
Landlord, operate as an Assignment to it of any or all subleases. Upon
expiration or termination of this Lease, Tenant shall peaceably surrender the
Premises and all alterations and additions thereto, broom clean the Premises,
remove all trade fixtures, leave the Premises in good order, repair and
condition, reasonable wear and tear expected, and comply with the provisions
herein. The delivery of keys to any employee of Landlord or to Landlord's agent
or any employee thereof shall not be sufficient to constitute a termination of
this Lease or surrender of the Premises.

                              32. PROFESSIONAL FEES

A. If Landlord should bring suit for possession of the Premises, for the
recovery of any sum due under this Lease,

CENTRAL PLAZA LEASE-20

<PAGE>

or because of the breach of any provisions of this Lease, or for any other
relief against Tenant hereunder, or in the even of any other litigation between
the parties with respect to this Lease, or if Landlord incurs any legal or
professional fees in its attempt to enforce this Lease, whether or not such
enforcement efforts proceed to the filing of a lawsuit, then all reasonable
costs and expenses, including without limitation, its reasonable actual
professional fees such as appraisers', accountants', and attorneys' fees
(including those on appeal), incurred therein shall be paid by Tenant. If
Landlord employs a collection agency to recover delinquent charges, Tenant
agrees to pay all reasonable collection agency fees charged to Landlord in
addition to Rent, late charges, interest and other reasonable sums payable under
this Lease.

B. If Landlord is named as a defendant in any suit brought against Tenant in
connection with or arising out of Tenant's occupancy hereunder, Tenant shall pay
to Landlord its costs and reasonable expenses incurred in such suit, including
without limitation, its actual reasonable professional fees such as appraisers',
accountants' and attorneys' fees, unless such action is the result of the sole
negligence of the Landlord.

                            33. PERFORMANCE BY TENANT

All covenants and agreements to be performed by Tenant under any of the terms of
this Lease shall be performed by Tenant at Tenant's sole cost and expense and
without any abatement of Rent except as specifically provided herein. If Tenant
shall fail to pay any sum of money owed to any party other than Landlord, for
which it is liable hereunder, or if Tenant shall fail to perform any other act
on its part to be performed hereunder, and such failure shall continue for ten
(10) days after notice thereof by Landlord, Landlord may, without waiving or
releasing Tenant from obligations of Tenant, but shall not be obligated to, make
any such payment or perform any such other _ct to be made or performed by
Tenant. All sums so paid by Landlord and all incidental costs together with
interest thereon at the rate equal to the prime commercial rate of interest in
effect at the time of such payment as published from time to time by Seattle
First National Bank, Head Office, Seattle, Washington, plus two percent (2%),
from the date of such payment by Landlord, shall be payable by Tenant to
Landlord on demand. Tenant covenants to pay any such sums, and Landlord shall
have (in addition to any other right or remedy of Landlord) all rights and
remedies in the event of the non-payment thereof by Tenant as are set forth in
Section 23.

                                 34. MORTGAGEES

If Tenant elects to terminate this Lease upon Landlord's default, Tenant must
notify any Mortgagee whose address shall have been furnished to Tenant, at least
ninety (90) days in advance of the proposed effective date of such termination.
For purposes of this Lease, "Mortgagee" shall include all mortgagees or holders
of a beneficial interest in a Deed of Trust constituting a lien on the Project
or any portion thereof. During this ninety (90) day period, the Mortgagee may
commence to curing the default. If the default cannot be cured within this
ninety (90) day period, the Lease shall not be terminated if the Mortgagee or
ground lessor have made diligent efforts to cure the default within said ninety
(90) day period and have diligent efforts. If the default is one which is not
susceptible of cure by the Mortgagee within this ninety (90) day period because
the mortgagee is not in possession of the Building or property, this ninety (90)
day period shall be extended to include time needed to obtain possession of the
Premises by the Mortgagee by power of sale or a judicial foreclosure or other
legal means, provided that right to possession is pursued with due diligence.

                           35. DEFINITION OF LANDLORD

The term "Landlord" as used in this Lease, so far as covenants or obligations on
the part of Landlord are concerned,

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<PAGE>

shall be limited to mean and include only the owner or owners, or a ground
lessee, a the time in question, of the fee title of the Premises. In the event
of any transfer, assignment or other conveyance or transfers of any such title,
Landlord herein named (and in case of any subsequent transfers or conveyances,
the then grantor) shall be automatically freed and relieved from and after the
date of such transfer, assignment or conveyance of all liability as respects the
performance of any covenants of this Lease, and the transferee(s), grantee(s) or
assignee(s) shall be deemed to have assumed and agreed to observe and perform
any and all obligations of Landlord hereunder. Landlord may assign or transfer
any and all obligations of Landlord hereunder during its ownership of the
Premises. Landlord may transfer its interest in the Premises without the consent
of Tenant and such transfer or subsequent transfer shall not be deemed a
violation on Landlord's part of any of the terms and conditions of this Lease.

                                   36. WAIVER

The waiver by Landlord or Tenant or any breach of any term, covenant or
condition herein contained shall not be deemed to be a waiver of a any
subsequent breach of the same or any other term, covenant or condition herein
contained, nor shall any custom or practice which may grow up between the
parties in the administration of the terms hereof be deemed a waiver of or in
any way affect the right of Landlord to insist upon the performance by Tenant in
strict accordance with said terms. The subsequent acceptance by Landlord of Rent
or other payments due Landlord hereunder shall not be deemed to be a waiver of
any preceding breach by Tenant of any term, covenant or condition of this Lease,
other than the failure of Tenant to pay the particular Rent or other payment so
accepted regardless of Landlord's knowledge of such preceding breach at the time
of acceptance of such Rent. No acceptance by Landlord of a lesser sum than the
Rent or other sum then due shall be deemed to be other than on account of the
earliest installment of such Rent or other sum then due, and Landlord may accept
such check or payment without prejudice to Landlord's right to recover the
balance of such amount due or pursue any other remedy available to Landlord
pursuant to this Lease or otherwise. The consent or approval of Landlord to or
of any act by Tenant requiring Landlord's consent or approval shall not be
deemed to waive or render unnecessary Landlord's consent to or approval of any
subsequent similar acts by Tenant.

                                37. SIGN CONTROL

Tenant shall not affix, paint, erect or inscribe any sign, projection, awning,
signal or advertisement of any kind to any part of the Premises, Building or
Project, including without limitation, the inside or outside of windows or
doors, without the written consent of Landlord. Landlord shall have the right to
remove any signs or other matter, installed without Landlord's permission,
without being liable to Tenant by reason of such removal, and to charge the cost
of removal to Tenant as additional rent hereunder, payable within ten (10) days
of written demand by Landlord. Landlord reserves the right to establish or
change sign policies and to bring any of Tenant's existing signs into compliance
with any such policies, or to relocate Tenant's sign(s), at Landlord's expense.
Tenant may display a sign subject to Landlord's approval in directory, at
Tenant's expense and for a monthly rental of $20.00 per month.

                                   38. PARKING

Tenant and Tenant's employees may use the parking facilities upon such terms and
conditions as may from time to time be established by Landlord and upon the
terms and conditions set forth in the Rules and Regulations; provided, however,
that there will be six (6) customer parking stalls reserved in the principal
parking area of the demised premises. Landlord consents to Tenant placing
appropriate "customer only" signs on those six (6) stalls.

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<PAGE>

                                39. FORCE MAJEURE

Landlord shall have no liability whatsoever to Tenant on account of: (A) the
inability of Landlord to fulfill, or delay in fulfilling, any of Landlord's
obligations under this Lease by reason of strike, other labor trouble,
governmental preemption or priorities or other controls in connection with a
national or other public emergency, or shortages of fuel, supplies or labor
resulting therefrom or any other cause, whether similar or dissimilar to the
above, or acts of God, beyond Landlord's reasonable control; or (B) any failure
or defect in the supply, quantity or character of electricity, gas, water, or
any other utility furnished to the Premises by reason of any requirements, act
or omission of any public or private utility, or other entity furnishing the
Building with such utilities, or for any other reason, whether similar or
dissimilar to the above, beyond Landlord's reasonable control. If this Lease
specifies a time period for performance of an obligation of Landlord, that time
period shall be extended by the period of any delay in Landlord's performance
caused by any of the above-described or events of force majeure.

                             40. TERMS AND HEADINGS

The words "Landlord" and "Tenant" as used herein shall include the plural as
well as the singular. Words used in any gender include other genders. The
Section headings of this Lease are not a part of this Lease and shall have no
effect upon the construction or interpretation of any part hereof.

                                    41. TIME

Time is of the essence with respect to the performance of every provision of
this Lease in which time of performance is a factor.

                        42. PRIOR AGREEMENT OR AMENDMENTS

This Lease contains all of the agreements of the parties hereto with respect to
any matter covered or mentioned in the Lease and no prior agreement or
understanding pertaining to any such matter shall be effective for any purpose
unless contained in a writing executed by the party sought to be bound, on the
same date or a date subsequent to the execution of this Lease. No provisions of
this Lease may be amended or added to except by an agreement in writing signed
by the parties hereto or their respective successors-in-interest.

                                43. SEVERABILITY

Any provisions of this Lease which shall prove to be invalid, void or illegal in
no way affects, impairs or invalidates any other provisions hereof, and such
other provisions shall remain in full force and effect.

                                  44. RECORDING

Tenant shall not record this Lease nor a short form memorandum thereof without
the prior consent of the Landlord. Landlord may in its sole discretion record
this Lease or a memorandum thereof.

                           45. LIMITATION OF LIABILITY

the event of any alleged failure, breach or default hereunder by Landlord, the
sole and exclusive remedy shall be

CENTRAL PLAZA LEASE-23

<PAGE>

against the Landlord's interest in the building and his liability insurance
limits.

                           46. MODIFICATION FOR LENDER

Notwithstanding anything to the contrary contained in this Lease, if, in
connection with obtaining construction, interim or permanent financing for the
Building and/or the Project the Lender shall request reasonable modifications in
this Lease as a condition to such financing, Tenant will not unreasonably
withhold, delay or defer its consent thereto, provided that such modifications
do not increase the obligations of Tenant hereunder or materially adversely
affect the leasehold interest hereby created or Tenant's rights hereunder.

                               47. QUIET ENJOYMENT

Landlord covenants and agrees with Tenant that upon Tenant paying the Rent
required under this Lease and paying all other charges and performing all of the
covenants and provisions aforesaid on Tenant's part to be observed and performed
under this Lease, and if Tenant is in compliance with the Rules and Regulations
and Conditions, Covenants and Restrictions, Tenant shall and may peaceably and
quietly have, hold, and enjoy the Premises in accordance with the Lease,
provided that, Tenant's rights hereunder shall be subject to the provisions
herein with respect to start-up inconveniences.

                            48. TENANT AS CORPORATION

If Tenant executes this Lease as a corporation, then Tenant and the person
executing this Lease on behalf of Tenant represent and warrant that the
individuals executing this Lease on Tenant's behalf are duly authorized to
execute and deliver this Lease on its behalf in accordance with a duly adopted
resolution of the Board of Directors of Tenant, a copy of which is to be
delivered to Landlord on execution hereof, and in accordance with the Bylaws of
Tenant and that this Lease is binding upon Tenant in accordance with its terms.

                          49. MISCELLANEOUS PROVISIONS

Any term of this Lease which requires Landlord's consent or approval shall be
construed to include the following words:

     "which consent or approval shall not be unreasonably withheld."

LANDLORD:                               TENANT:
                                        WESTSOUND BANK

/s/ LOUIS WEIR          10-1-01         BY: /s/ David K. Johnson        10/01/01
-------------------------------             ------------------------------------
LOUIS WEIR              Date            Its President                   Date

/s/ DELORES WEIR        10-1-01
-------------------------------
DELORES WEIR            Date

CENTRAL PLAZA LEASE-24

<PAGE>

STATE OF Washington)
COUNTY OF Kitsap   )

I certify that I know or have satisfactory evidence that Louis J. Weir is the
individual who appeared before me, and said individual acknowledged that he
signed this instrument and acknowledged it to be a free and voluntary act for
the uses and purposes mentioned in the instrument.

<TABLE>
<S>                      <C>                   <C>

Dated: October 1, 2001          (SEAL)         /s/ CHERIE A. LARSON
                           CHERIE A. LARSON    ---------------------------------
                          COMMISSION EXPIRES   (Notary Public in and for the
                            NOTARY PUBLIC      State of Washington, residing at)
                              08-01-05
                         STATE OF WASHINGTON

My appointment expires                         Bremerton
August 1, 2005

STATE OF Washington)
COUNTY OF Kitsap   )
</TABLE>

I certify that I know or have satisfactory evidence that Delores Weir is the
individual who appeared before me, and said individual acknowledged that she
signed this instrument and acknowledged it to be a free and voluntary act for
the uses and purposes mentioned in the instrument.

<TABLE>
<CAPTION>

<S>                                            <C>

Dated: October 1, 2001                         ---------------------------------
                                               (Notary Public in and for the
                                               State of Washington, residing at)

My appointment expires:
August 1, 2005                                 ---------------------------------

STATE OF Washington)
COUNTY OF Kitsap   )
</TABLE>

I certify that I know or have satisfactory evidence that David K. Johnson is the
person who appeared before me, and said person acknowledged that he signed this
instrument, on oath stated that he was authorized to execute the instrument and
acknowledged it as the President of Westsound Bank to be the free and voluntary
act of such party for the uses and purposes mentioned in the instrument.

<TABLE>
<CAPTION>

<S>                      <C>                   <C>

Dated: October 1, 2001          (SEAL)         /s/ CHERIE A. LARSON
                           CHERIE A. LARSON    ---------------------------------
                          COMMISSION EXPIRES   (Notary Public in and for the
                            NOTARY PUBLIC      State of Washington, residing at)
                              08-01-05
                         STATE OF WASHINGTON

My appointment expires                         Bremerton
August 1, 2005
</TABLE>

<PAGE>

                                   EXHIBIT "A"

                                 SILVERDALE WAY

                                 CENTRAL PLAZA
                                   Site plan

                                (CENTRAL PLAZA)

Safeway

<PAGE>

                                   EXHIBIT "B"

That portion of the South one half of the North one half of the Southwest one
quarter of the Southwest one quarter of Section 16, Township 25 North, Range 1
East, W.M., in Kitsap County, Washington, lying Southeasterly of Kitsap Way and
Westerly of the West line of the East 572.00 feet of said subdivision as
measured along the South line of said Southwest one quarter of the Southwest one
quarter described as follows:

Commencing at the Southwest corner of said Southwest one quarter of Section 16;
thence North 00 degrees 43'30" East along the West line of said Southwest one
quarter, a distance of 990.02 feet to the North line of said South one half of
the North one half of the Southwest one quarter of the Southwest one quarter;
thence South 88 degrees 28'07" East along said North line, a distance of 505.79
feet to the Southeasterly right-of-way line of said Kitsap Way and the True
Point of Beginning, said point being 50.00 feet when measured at right angles
from the centerline of said Kitsap Way; thence continue South 88 degrees 28'07"
East along said North line a distance of 232.35 feet to said West line of the
East 572.00 feet of said subdivision as measured along the South line of said
Southwest one quarter of the Southwest one quarter; thence South 00 degrees
55'52" West along said West line a distance of 206.30 feet; thence North 88
degrees 28'07" West a distance of 383.78 feet to said Southeasterly right-of-way
line of Kitsap Way; thence North 37 degrees 25'10" East along said Southeasterly
right-of-way line, a distance of 254.63 feet to the True Point of Beginning.

<PAGE>

                                   EXHIBIT "C"

A license is granted to tenants, employees and customers to remain on Central
Plaza property during business hours provided they refrain from the following
conduct or activities which are prohibited:

1.   Engaging in any criminal activity as defined by Silverdale, Kitsap County
     and Washington State criminal codes.

2.   Relocating or misusing Central Plaza furniture; including placing feet on
     chairs or benches or leaning back on two legs of chairs.

3.   Putting out cigarettes on the floor or furniture and otherwise littering on
     the property.

4.   Garnering in groups that block traffic ways, stairs, escalators or
     storefronts.

5.   Skateboarding or roller-skating on the property.

6.   Horse play - running, jumping, pushing, jostling patrons and/or customers.

7.   Creating loud noise or amplified yelling or screaming.

8.   Wearing apparel with spikes, studs or martial arts equipment or other
     paraphernalia which may be dangerous or harmful to persons or property on
     the property.

9.   Spitting or throwing anything while on the property.

10.  Distributing handbills or soliciting in unauthorized locations, or
     panhandling.

11.  Using obscene or offensive language or gestures (spoken or displayed).

12.  Damaging plants or landscaping.

13.  Entering a restroom which is designated solely for the opposite sex.

14.  Posting handbills, posters, or other literature outside the tenants
     premises.

15.  Failure to be fully clothes (i.e. no shoes or shirt).

16.  Using sexually explicit language or conduct.

17.  Sitting on handrails, stairs, or trash receptacles.

18.  Engaging in any other activity which in the reasonably exercised judgment
     of Landlord, and its security officers, constitutes any annoyance of
     nuisance to other persons entitled to use the property for its intended
     purpose.

19.  Tenant shall, and Tenant will require all employees to, park in areas which
     are from time to time designated by the Landlord and refrain from parking
     in areas designated for customers, loading or otherwise restricted.

<PAGE>

                                   EXHIBIT "D"

Landlord agrees to deliver to Tenant, and Tenant agrees to accept from Landlord,
possession of Suites 1 and 2, Central Plaza "AS IS" with no renovation of any
kind, except for the replacement of the stained ceiling tiles, which shall be
replaced at Landlord's sole expense. All repairs, renovation or improvements
shall be performed by Tenant at Tenant's sole expense in accordance with the
terms and conditions of this Lease.

<PAGE>

PROJECT:                WESTSOUND PLAZA

TENANT:                 WESTSOUND BANK

USE:                    BANKING & RELATED ISSUES

SPACE & SQUARE FEET:    SUITE 3
                        2,838 SQUARE FEET

LOUIS AND DELORES WEIR                                         WOLFE LAW OFFICES
WESTSOUND PLAZA LEASE                                           216 Sixth Street
                                                             Bremerton, WA 98337
                                                               Ph. (360)782-4200
                                                              Fax: (360)782-4212

<PAGE>

                                      LEASE

THIS LEASE is made as of this 1st day of October, 2003, by and between LOUIS and
DELORES WEIR, husband and wife, hereinafter called "Landlord," and Westsound
Bank, hereinafter called "Tenant."

                              1. BASIC LEASE TERMS

A.   COMMENCEMENT DATE:       October 1, 2003

B.   TENANT:                  Westsound Bank

     ADDRESS:                 Westsound Plaza, Suite #3, 9960 Silverdale Way,
                              Silverdale, WA 98383 Main Address: P.O. Box 405,
                              Bremerton, WA 98337

     PHONE:                   (360)405-1200

C.   LANDLORD:                Louis and Delores Weir

     ADDRESS:                 P.O. Box 3650
                              Silverdale, WA 98383

     PHONE:                   (360)698-1276

D.   PREMISES AREA:           Westsound Plaza
                              9960 Silverdale Way NW, Suite #3
                              Silverdale, WA 98383

E.   SQUARE FOOTAGE:          2838

F.   TENANT'S PERCENTAGE:     9.8%

G.   LEASE TERM:              8 years

H.   OPTION TO EXTEND:        Two 5 year options

I.   BASE RENT:               $16.00 per square foot = $45,408.00 per year,
                              payable monthly

              BASE RENT IN YEAR 1 = $3.784.00 /MONTH + 5% ANNUALLY

J.   ADDITIONAL RENT:         $4.00 per square foot = $11,352.00 per year,
                              payable monthly

             ADDITIONAL RENT IN YEAR 1 = $946.00/MONTH + 3% ANNUALLY

K.   SIGNAGE:                 $20.00/MONTH

WESTSOUND PLAZA LEASE-1

<PAGE>

     TOTAL RENT YEAR 1
     (BASE RENT + ADDITIONAL RENT + SIGNAGE) $4,750.00/MONTH

L.   SECURITY DEPOSIT:        $4,750.00   PD 2.5.04

M.   USE OF PREMISES:         Banking and related uses

N.   BROKERS:                 None

O.   PARKING:                 Two (2) reserved spaces, signed at Tenant's
                              expense

P. ENUMERATION OF EXHIBITS: The exhibits enumerated in this Section and attached
to this Lease are incorporated herein by reference and are to be construed as
part of this Lease. Each party agrees to perform any obligations on its part
stated in any and all such Exhibits:

     Exhibit A   -Site Plan of the Shopping Center
     Exhibit B   -Legal Description
     Exhibit C   -Rules and Regulations
     Exhibit D   -Description of Landlord's and Tenant's Work

Section 1 represents a summary of the basic terms of this Lease. In the event of
any inconsistency between the terms contained in Section 1 and any other clause
of this Lease, the terms of that clause shall prevail.

LANDLORD:                               TENANT: Westsound Bank

/s/ Louis Weir                          By: /s/ Illegible
-------------------------------------       ------------------------------------
Louis Weir                              Its: PRESIDENT

/s/ Delores Weir
-------------------------------------
Delores Weir

Tenant's Rent Payments Do Not Commence Until January 1, 2004. There Shall be No
Rent Paid for October, November and December of 2003.

WESTSOUND PLAZA LEASE-2

<PAGE>

               2. PREMISES AND COMMON AREA LEASED

A.   DEFINITIONS.

          1. Landlord hereby leases to Tenant and Tenant leases from Landlord
          those certain premises described in Section 1 and in Exhibit "A"
          attached hereto (the "Premises").

          2. The Premises are contained within a building (the "Building") which
          is located at the address designated in Section 1 and Legally
          described on Exhibit "B" attached hereto (the "Property"). The term
          "Building" shall include all of the rentable square feet and the
          Common Areas as defined herein.

          3. "Common Areas" shall be defined as areas appurtenant to the
          Premises which are not a part of a Premises for any other tenant in
          the Building, including, but not limited to: entrances, lobbies,
          stairways, common ducts, conduits, wire and appurtenant equipment
          serving the Premises, trash areas, parking areas, roadways, sidewalks,
          walkways, and landscaped areas and similar areas and facilities on the
          Property which are appurtenant to the Building.

B. Use OF BUILDING COMMON AREAS. Tenant shall have the nonexclusive right to use
in common with other tenants in the Building, the Common Areas subject to the
Rules and Regulations which may be promulgated by Landlord from time to time
(the "Rules and Regulations").

C. RESERVATION. Landlord reserves the right from time to time without
unreasonable interferences with Tenant's use:

          1. To install, use, maintain, repair and replace pipes, ducts,
          conduits, wires and appurtenant meters and equipment included in the
          Premises which are located in the Premises or located elsewhere
          outside the Premises, and to expand the Building; and

          2. To make changes, additions or deletions to the Common Areas,
          including, without limitation, changes in the location, size, shape
          and number of driveways, entrances, parking spaces, parking areas,
          loading and unloading areas, ingress, egress, direction of traffic,
          landscaped areas and hallways; and specifically but without limitation
          to modify the surface parking area; and

          3. To temporarily close any of the Common Areas for maintenance
          purposes so long as reasonable access to the Premises remains
          available, and

          4. To add additional building and improvements to the Common Areas;
          and

          5. To use the Common Areas while engaged in making additional
          improvements, repairs and alterations to the Building, or any portion
          thereof;

WESTSOUND PLAZA LEASE-3

<PAGE>

          6. To perform such other acts and make such other changes in, to or
          with respect to the Common Areas and the Building as Landlord may, in
          the exercise of sound business judgment, deem to be appropriate.

D. COMMENCEMENT DATE. The Lease Term shall be for the period designated in
Section 1, commencing on the date specified in Section 1, and ending on the
expiration of such period, unless the Lease Term shall be sooner terminated as
provided in this Lease. The date upon which the Lease commences shall be
Commencement Date. Reference in this Lease to a "Lease Year" shall mean each
twelve month period commencing with the first day of the calendar month in which
the term of the Lease commences.

E. OPTION TO EXTEND. IN THE EVENT TENANT IS NOT IN DEFAULT AND HAS NOT BEEN IN
DEFAULT AT ANY TIME DURING THE LEASE TERM, TENANT SHALL HAVE THE RIGHT TO EXTEND
THE LEASE TERM FOR TWO PERIODS OF Five (5) YEARS ON THE TERMS AND CONDITIONS SET
FORTH HEREIN ("OPTION "). IN THE EVENT TENANT WISHES TO EXERCISE ITS OPTION TO
EXTEND, TENANT SHALL NOTIFY LANDLORD IN WRITING NO LATER THAN NINETY (90) DAYS
BEFORE THE EXPIRATION OF THE LEASE TERM. IN THE EVENT TENANT PROVIDES SUCH
NOTICE, AND IS NOT AND HAS NOT BEEN IN DEFAULT AT ANY TIME DURING THE LEASE TERM
THEN LANDLORD AND TENANT SHALL BE BOUND TO EXTEND THE LEASE TERM FOR THE
PREMISES ON THE SAME TERMS AND CONDITIONS OF THE LEASE EXCEPT FOR:

     1.   THE LEASE TERM SHALL BE EXTENDABLE FOR AN ADDITIONAL TWO Five (5) YEAR
          TERMS; AND

     2.   THE BASE RENT FOR THE OPTION PERIOD SHALL BE NEGOTIATED. IN THE EVENT
          LANDLORD AND TENANT ARE UNABLE TO AGREE UPON A PROPER RENTAL FOR THE
          EXTENDED TERM, THEN EACH OF THE PARTIES HERETO SHALL APPOINT AN
          ARBITRATOR, AND IN CASE THE ARBITRATORS ARE UNABLE TO AGREE ON A
          PROPERTY RENTAL FOR THE EXTENDED TERM, THEY SHALL JOINTLY APPOINT A
          THIRD ARBITRATOR. IF THEY SHOULD BE UNABLE TO AGREE ON A THIRD
          ARBITRATOR, THEN THE THIRD ARBITRATOR SHALL BE APPOINTED BY THE
          PRESIDING JUDGE OF THE SUPERIOR COURT OF KITSAP COUNTY, WASHINGTON.
          THE DECISION OF ANY TWO SUCH ARBITRATORS SHALL BE BINDING UPON THE
          PARTIES HERETO. THE COSTS AND EXPENSES OF THE ARBITRATION PROCEEDING
          SHALL BE BORNE EQUALLY BY THE PARTIES, EXCEPT THAT EACH PARTY SHALL BE
          RESPONSIBLE FOR ITS OWN ATTORNEYS' FEES AND COSTS, UNLESS THE
          ARBITRATOR'S AWARD IS OTHERWISE. IN NO EVENT SHALL THE BASE RENT BE
          LESS THAN THE BASE RENT FOR THE LAST YEAR OF THE INITIAL LEASE TERM.

F. TENANT'S RIGHT TO TERMINATE. In the event Tenant elects to terminate this
Lease in order to relocate at another location in Silverdale, which Tenant's
Board of Directors determines is a better place of business for Tenant, then in
that event, Tenant may terminate this Lease upon ninety (90) day's advance
written notice; provided, however, that in the event of such termination, all
of Tenant's leasehold improvements shall be removed at Tenant's sole expense and
the Premises shall be restored to their original condition, or better.

WESTSOUND PLAZA LEASE-4

<PAGE>

                                  3. POSSESSION

A. DELIVERY OF POSSESSION. Landlord shall deliver possession to Tenant on or
before the Commencement Date as set forth in Section 1.

B. TENANT IMPROVEMENTS. Tenant hereby acknowledges that Landlord has no
obligation to make improvements to the space prior to Tenant's occupancy. (See
Exhibit "D").

                                     4. RENT

A. BASE RENT. Tenant hereby covenants and agrees to pay Landlord as Base Rent
for the Premises the sum as provided in Section 1 above (subject to adjustment
as hereinafter provided), in advance, on the first day of each calendar month
from the Commencement Date, beginning _______ 2003 object of the terms outlined
on page 2 of the lease. If the Lease Term commences or ends on any day other
than the first day of a calendar month, then the Base Rent for such month shall
be prorated. In addition to the Base Rent, Tenant agrees to pay the Additional
Rent required by this Lease. All Rent shall be paid to LOUIS AND DELORES WEIR,
P.O. Box 3650, Silverdale, WA 98383, without prior demand and without any
deduction or offset, in lawful money of the United States of America, at the
address of Landlord designated in Section 1 or to such other person or at such
other place as Landlord may from time to time designate in writing.

B. LATE CHARGES AND INTEREST. In the event Tenant fails to pay Rent within ten
(10) days of the date when due or in the event Tenant fails to make any other
payment for which Tenant is obligated under this Lease when due, the Tenant
shall pay to Landlord a late charge equal five percent (5%) of the amount due to
compensate Landlord for the extra costs incurred as a result of such late
payment. Additionally, all such delinquent Rent or other sums, plus late
charges, shall bear interest from the date due until paid, at the prime
commercial rate of interest in effect at the time such obligation becomes
delinquent as published from time to time by the Wall Street Journal, plus two
percent (2%). Any payments of any kind returned for insufficient funds will be
subject to an additional charge of $25.00. The provisions set forth herein shall
be in addition to and shall not limit Landlord's remedies in the event of
Tenant's failure to pay Rent.

C. DEFINITION. Any reference to "Rent" or "Rental" in this Lease shall mean both
Base Rent and Additional Rent as defined herein.

D. RECEIPT. The amount of Three Thousand Seven Hundred Eighty-Four Dollars
($3,784.00) is paid herewith to Landlord on January 1, 2004, receipt of which is
hereby acknowledged, which shall represent the first month's rental.

E. ADJUSTMENTS. Base Rent shall increase by five percent (5%) each year.

                               5. ADDITIONAL RENT

A. DEFINITION. In addition to the Base Rent, Tenant shall pay Tenant's
Percentage of Additional Rent which shall be comprised of the Property Taxes and
Operating Expenses defined as follows:

WESTSOUND PLAZA LEASE-5

<PAGE>

     1. PROPERTY TAXES. The terms "Property Taxes" shall include all real and
     personal property taxes, assessments, license fees, license tax, rental
     tax, levy, or tax on net income imposed by any governmental authority or
     agency on the Property and on all other improvements, fixtures, equipment
     and other property of Landlord located in or used in connection with the
     operation of the Property.

     2. OPERATING EXPENSES. The term "Operating Expenses" shall include the
     total amounts paid or payable by Landlord or others on behalf of Landlord
     in connection with the ownership, maintenance, repair and operation of the
     Building and the Property and shall include, but not be limited to the
     following: (A) total charges of any independent contractors employed in the
     care and operation, management, maintenance and repair of the Property
     and/or the Building; (B) cost of the fire alarm system; (C) landscaping;
     (D) trash removal; (E) the amount paid for all supplies, tools, equipment
     and necessities which are occasioned by every day wear and tear; (F) the
     cost of all utilities which are not separately metered including
     electricity, gas, water and sewer charges; (G) the amount paid for premiums
     of all insurance required from time to time by Landlord and Landlord's
     mortgagee and other items as are now or hereafter customarily included in
     the cost of managing, operating, maintaining, and repairing.

B. SEPARATELY METERED UTILITIES. Tenant shall be responsible for all separately
metered utilities and services.

C. HVAC. Landlord warrants that the HVAC system currently serving Tenant's
premises is in good repair and subject to a repair and maintenance contract.
Tenant shall pay their proportion of the repair and maintenance contract charges
as well as the cost of any other repairs incurred during each year as additional
rent, upon being billed therefore.

D. INTENT. The intent of this section is to require Tenant to pay its
proportionate share of the Property Taxes and Operating Expenses and is intended
to pass onto Tenant and cause to be reimbursed to Landlord all direct costs of
operating, repairing and managing the Property, Common Areas, Building, and the
Premises. Notwithstanding anything contained in this paragraph, the Rent payable
by Tenant shall in no event be less than the Base Rent.

E. RECEIPT. The amount of Nine Hundred Forty-Six Dollars ($946.00) is paid
herewith to the Landlord on January 1, 2004, receipt of which is hereby
acknowledged, which shall represent the Additional Rent for January, 2004.

F. SIGNAGE. Tenant shall pay Landlord Twenty Dollars ($20.00) per month for
rental of space on directory sign along Silverdale Way. The amount of $20.00 is
paid herewith to the Landlord on January 1, 2004, receipt of which is hereby
acknowledged, which shall represent the signage rent for January, 2004.

G. ADJUSTMENTS. The additional rent for the term of this Lease shall increase by
three percent (3%) each year regardless of the actual increase in property taxes
and operating expenses.

WESTSOUND PLAZA LEASE-6

<PAGE>

                               6. SECURITY DEPOSIT

Upon the execution of this Lease, Tenant shall deposit with Landlord the amount
of the Security Deposit ("Security Deposit") set forth in Section 1 in part as
security for the performance by Tenant of the provisions of this Lease. If
Tenant is in default, Landlord can use the Security Deposit or any portion of it
to sure the default or to compensate Landlord for all damage sustained by
Landlord resulting from Tenant's default. Upon demand, Tenant shall immediately
pay to Landlord a sum equal to the portion of the Security Deposit expended or
applied by Landlord to maintain the Security Deposit in the amount initially
deposited with Landlord. If Tenant is not in default at the expiration or
termination of this Lease, Landlord shall return the entire Security Deposit to
Tenant. Landlord's obligations with respect to the deposit are those of a debtor
and not of a trustee, and Landlord can commingle the Security Deposit with
Landlord's general funds. Landlord is not required to pay Tenant interest on the
Deposit. Landlord shall be entitled to immediately endorse and cash Tenant's
Security Deposit; however, such endorsement and cashing shall not constitute
Landlord's acceptance of this Lease. In the event Landlord does not accept this
Lease, Landlord shall return said Security Deposit to Tenant. Should Landlord
sell its interest in the Property during the Lease Term and if Landlord deposits
with the purchaser the Security Deposit deposited by Tenant, Landlord shall be
discharged from any further liability to Tenant with respect to the Security
Deposit.

                                     7. USE

Tenant shall use the Premises for the purposes stated in Section 1 and shall not
use or permit the Premises to be used for any other purpose without the prior
written consent of Landlord. Tenant shall not use or occupy the Premises in
violation of law or of the Certificate of Occupancy issued for the Building, and
shall, upon written notice from Landlord, discontinue any use of the Premises
which is declared by any governmental authority having jurisdiction to be a
violation. Tenant shall not do or permit anything to be done in or about the
Premises which will in any way obstruct or interfere with the rights of other
tenants or occupants of the Building, or injure or annoy them, or use or allow
the Premises to be used for any improper, immoral, unlawful or objectionable
purpose, nor shall Tenant cause, maintain or permit any nuisance in, on or about
the Premises. Tenant shall not commit or suffer to be committed any waste in or
upon the Premises and shall keep the Premises in a "broom clean" condition.
Tenant shall be responsible for all structural engineering required to determine
structural load. Additional restrictions and regulation regarding Tenant's use
of the Premises and Building shall be set forth in the Rules and Regulations.

                                   8. NOTICES

Any notice required or permitted to be given hereunder must be in writing and
may be given by personal delivery or by mail, and if given by mail shall be
deemed sufficiently given if mailed by registered or certified mail addressed to
Tenant at the Building, or to Landlord at the address designated in Section 1.
Either party may specify a different address for notice purposes by written
notice to the other. The current addresses for notices are:

WESTSOUND PLAZA LEASE-7

<PAGE>

TO LANDLORD:             TO TENANT:

Louis and Delores Weir   Westsound Bank
P.O. Box 3650            Attn: David Johnson, CEO
Silverdale, WA 98383     190 Pacific Avenue
                         Bremerton, WA 98337

                                 9. HOLDING OVER

If Tenant holds over after the expiration or earlier termination of the Lease
Term without the express written consent of Landlord, Tenant shall become a
Tenant at sufferance only, at a rental rate equal to a Base Rent of one hundred
fifty percent (150%) of the Base Rent in effect upon the date of such expiration
and Additional Rent as calculated herein, prorated on a daily basis, and shall
be subject to the terms, covenants and conditions of this Lease. Acceptance by
Landlord of Rent after such expiration or earlier termination shall not result
in a renewal or extension of this Lease. The foregoing provisions of this
Section are in addition to and do not affect Landlord's rights specified herein
or any rights of Landlord provided by law for such holding over. If Tenant fails
to surrender the Premises upon the expiration of this Lease despite demand to do
so by Landlord, Tenant shall indemnify and hold Landlord harmless from all loss,
claim or damage Landlord incurs, including without limitation, a claim made by a
successor tenant for failure to provide possession of the Premises and any
attorney's fees and costs incurred by Landlord related thereto.

                         10. TAXES ON TENANT'S PROPERTY

Tenant shall be liable for and shall pay, at least ten (10) days before
delinquency, all taxes levied against any personal property or trade fixtures
placed by Tenant in or about the Premises. If any such taxes on Tenant's
personal property or trade fixtures are levied against Landlord or Landlord's
property or if the assessed value of the Premises is increased by the inclusion
therein of a value placed upon such personal property or trade fixtures of
Tenant and if Landlord, after written notice to Tenant, pays the taxes based
upon such increased assessment, which Landlord shall have the right to do
regardless of the validity thereof, but only under proper protest if requested
by Tenant, Tenant shall, upon demand, repay to Landlord the taxes so levied
against Landlord, or the portion of such taxes resulting from such increase in
the assessment.

                            11. CONDITION OF PREMISES

A. REPRESENTATIONS. Tenant acknowledges that neither Landlord nor any agent of
Landlord has made any representation or warranty with respect to the Premises or
the Building or with respect to the suitability of either for the conduct of
Tenant's business.

B. ACCEPTANCE. The taking of possession of the Premises by Tenant shall
conclusively establish that the Premises and the Building were in satisfactory
condition at such time, subject to punch list items agreed to by Landlord and
Tenant in writing prior to Tenant's taking of possession.

WESTSOUND PLAZA LEASE-8

<PAGE>

C. LANDLORD'S OBLIGATION. Landlord's sole construction obligation under this
Lease shall be those obligations set forth in Exhibit "D".

                        12. ALTERATIONS AND IMPROVEMENTS

A. CONSTRUCTION OF IMPROVEMENTS. Tenant shall make no alterations, additions or
improvements in or to the Premises without Landlord's prior written consent, and
then only by contractors or mechanics approved by Landlord in writing. Tenant
shall submit to Landlord plans and specifications for any proposed alterations,
additions or improvements to the Premises, and Tenant may not make such
alterations, additions or improvements except in accordance with the plans and
specifications approved by Landlord, and shall not amend or modify such plans
and specifications without Landlord's prior written consent. Tenant agrees that
there shall be no construction of partitions or other improvements which might
interfere with Landlord's free access to mechanical installations or service
facilities of the Building or interfere with the moving of Landlord's equipment
to or from the enclosures containing said installations. All such work shall be
done at such times and in such manner as Landlord may from time to time
designate and also shall comply with all applicable provisions of this Lease and
the Rules and Regulations. Tenant covenants and agrees that all work done by
Tenant shall be performed in full compliance with all laws, rules, orders,
ordinances, regulations and requirements of all governmental agencies, offices
and boards having jurisdiction over the Premises. Before commencing any work,
Tenant shall give Landlord at least ten (10) days written notice of the proposed
commencement of such work and shall, if required by Landlord, secure at Tenant's
own cost and expense, a completion and lien indemnity bond satisfactory to
Landlord for said work. Tenant further covenants and agrees that any liens filed
against the Property, the Premises, or the Building for work claimed to have
been done for or materials claimed to have been furnished to Tenant, will be
discharged by Tenant, by bond or otherwise, within ten (10) days after the
filing thereof, at the cost and expense of Tenant. All alterations, additions or
improvements upon the Premises shall become the property of Landlord, and shall
remain upon, and be surrendered with the Premises as a part thereof, at the end
of the Lease Term.

B. REMOVAL OF TENANT'S PROPERTY. All articles of personal property and all
business and trade fixtures, machinery and equipment, furniture and movable
partitions owned by Tenant or installed by Tenant at its expense in the Premises
shall be and remain the property of Tenant and may be removed by Tenant at any
time during the Lease Term as long as: (I) such removal is made prior to the
expiration of the Lease Term; (II) Tenant immediately repairs all damage caused
by or resulting from such removal; and (III) Tenant is not in default hereunder.
Such installation, location and movement shall further be subject to the Rules
and Regulations. If Tenant shall fail to remove all of its personal property
fixtures from the Premises upon termination of this Lease, for any cause
whatsoever, Landlord may, at its option, remove the same in manner that Landlord
shall choose, and store said effects without liability to Tenant for loss
thereof. In such event, Tenant agrees to pay Landlord upon demand any and all
expenses incurred in such removal, including court costs and attorney's fees and
storage charges no such effects, for any length of time that the same shall be
in Landlord's possession. If Tenant fails to pay for the cost of said storage
after it has been stored for a period of thirty (30) days or more, Landlord may,
at its option, sell said effects, or any of the same at private sale and without
legal process, for such price at Landlord may obtain and apply the proceeds of
such sale upon any

WESTSOUND PLAZA LEASE-9

<PAGE>

amounts due under this Lease, including but not limited to the costs associated
with the sale of the personal property and fixtures.

                                   13. REPAIRS

A. TENANT'S OBLIGATION. By entry hereunder, Tenant accepts the Premises as being
in good and sanitary order, condition and repair. Tenant shall keep, maintain
and preserve the Premises in the same condition as it was when delivered to
Tenant and shall, at Tenant's sole cost and expense, make all repairs to the
Premises which repairs shall be made in accordance with this Lease. Tenant
shall, upon the expiration of the Lease Term surrender the Premises to Landlord
in the same condition as when received, usual and ordinary wear and tear or
damage caused by insured casualty excepted. Landlord shall have no obligation to
alter, remodel, improve, repair, decorate or paint the Premises or any part
thereof. The parties hereto affirm that Landlord has made no representations to
Tenant respecting the condition of the Property, Common Areas, and Premises, or
the Building. Tenant shall not be responsible for any expense nor required to
make any repairs or replacements which may be necessary as a result of damage or
destruction caused solely by Landlord's negligence or default.

                                    14. LIENS

Tenant shall not permit any mechanics', materialmen's or other liens to be filed
against the Property, the Building or against Tenant's leasehold interest in the
Premises. If any such liens are filed, Tenant shall have ten (10) days from the
date of such filing in which to either remove such liens or to provide a bond
indemnifying Landlord from and removing said lien in the amount of one hundred
twenty-five percent (125%) of the claimed lien amount. If Tenant fails to take
such measures in the time allowed, Landlord may, without waiving any of its
rights and remedies based on such breach of Tenant and without releasing Tenant
from any of its obligations, cause such liens to be released by any means it
shall deem proper, including payments in satisfaction of the claim giving rise
to such lien. Tenant shall pay to Landlord at once, upon notice by Landlord, any
sum paid by Landlord to remove such liens, together with interest at a rate
equal to the prime commercial rate of interest in effect at the time such
obligation is paid by Landlord as published from time to time by the Wall Street
Journal, plus two percent (2%) which interest rate shall apply from the date of
such payment by Landlord.

                              15. ENTRY BY LANDLORD

Landlord reserves and shall have the right to enter the Premises at reasonable
times and in a reasonable matter to: (A) inspect the same; (B) to show the
Premises to prospective purchasers or tenants; (C) to alter, improve or repair
the Premises or any other portion of the Building, without being deemed guilty
of any eviction of Tenant and without abatement of Rent. Tenant hereby waives
any claim for damages for any injury or inconvenience to or interference with
Tenant's business, any loss of occupancy or quiet enjoyment of the Premises, and
any other loss in, upon and about the Premises except to the extent such damages
or loss result solely from the negligence or willful misconduct of Landlord, its
agents or employees. Landlord shall have the right to use and all means which
Landlord may deem proper to open door and to enter the Premises in an emergency.
Any such entry to the Premises by Landlord by any means shall not

WESTSOUND PLAZA LEASE-10

<PAGE>

be construed or deemed to be a forcible or unlawful entry into the Premises, or
an eviction of Tenant from the Premises or any portion thereof, and any damages
caused on account thereof shall be paid by Tenant. It is understood and agreed
that no provision of this Lease shall be construed as obligating Landlord to
perform any repairs, alterations or improvements except as otherwise expressly
agreed herein by Landlord.

                           16. UTILITIES AND SERVICES

Tenant hereby acknowledges that Landlord has provided Tenant electricity for
normal lighting and fractional horsepower office machines, utilities and heat
separately metered to the Premises. Landlord shall furnish light to Common
Areas. The failure of such service if caused by (A) accident, breakage or
repairs; (B) strikes, lockouts or other labor disturbance or labor dispute of
any character; (C) governmental regulation, moratorium or other governmental
action; (D) inability despite the exercise of reasonable diligence or obtain
electricity, water or fuel; or by (E) any other cause beyond Landlord's
reasonable control, shall not result in any liability to Landlord. In addition,
Tenant shall not be entitled to any abatement or reduction of Rent by reason of
such failure, and no eviction of Tenant shall result from such failure.

                                 17. BANKRUPTCY

If Tenant shall file a petition in bankruptcy under any provision of the
bankruptcy Code as then in effect, or if Tenant shall be adjudicated a bankrupt
in involuntary bankruptcy proceedings and such adjudication shall not have been
vacated within sixty (60) days from the date thereof, or if a receiver or
trustee shall be appointed for Tenant's property and the order appointing such
receiver or trustee shall not be set aside or vacated within sixty (60) days
after the entry thereof, or if Tenant shall assign Tenant's estate or effects
for the benefit of creditors, or if this Lease shall, by operation of law or
otherwise, pass to any person or persons other than Tenant without the prior
written consent of Landlord, then in any such event Landlord may terminate this
Lease, if Landlord so elects, with or without notice of such election and with
or without entry or action by Landlord.

                         18. INDEMNIFICATION OF LANDLORD

A. TENANT'S INDEMNIFICATION. Subject to the Section, Tenant shall indemnify,
defend and hold Landlord, its trustees, general partners, limited partners,
agents, employees or contractors, harmless from all claims (1) arising from
Tenant's use of the Premises; (2) arising from the conduct of Tenant's business
or from any activity, work or thing done, permitted or suffered by Tenant in or
about the Premises, the Property, the Building or the Common Areas and (3)
arising from the act, omission, or negligence of any agent, employee, sublessee,
licensee or invitee of Tenant, in or about the Property, the Premises, Building
or the Common Areas. Tenant shall further indemnify, defend and hold Landlord,
its trustees, general partners, limited partners, agents, employees or
contractors, harmless from all claims arising from any breach or default in the
performance of any obligation to be performed by Tenant under the terms of this
Lease including Tenant's obligation to comply with the Rules and Regulations and
Covenants, Conditions and Restrictions and from and against all costs,
attorneys' fees, expenses and liabilities incurred in connection with any claim
or any action or proceeding which is brought

WESTSOUND PLAZA LEASE-11

<PAGE>

against Landlord, its trustees, general partners, limited partners, agents,
employees or contractors. In case any action or proceeding shall be brought
against Landlord by reason of any such claim, Tenant, upon notice from Landlord,
shall defend the same at Tenant's expense by counsel approved in writing by
Landlord. Tenant, as a material part of the consideration to Landlord, hereby
assumes all risk of damage to property or injury to persons in, upon or about
the Property, Premises, Building, or the Common Areas from any cause whatsoever
except that which is caused by the failure of Landlord, its general partners,
limited partners, agents, employees or contractors, to observe any of the terms
and conditions of this Lease where such failure has persisted for an
unreasonable period of time after written notice of such failure to Landlord.
Tenant hereby waives all its claims in respect thereof against Landlord, its
general partners, limited partners, agents, employees or contractors.

B. LIMITATION. Notwithstanding this Section, in the event of concurrent
negligence of Tenant, its agents, employees, sublesses, invitees, licensees or
contractors on the one hand, and that of Landlord, its trustees, general
partners, limited partners, agents, employees, or contractors on the other hand,
which concurrent negligence results in injury or damage to persons or property
and relates to the construction, alteration, repair, addition to, subtraction
from, improvement to or maintenance of the Property, the Premises, Common Areas,
or the Building, Tenant's obligation to indemnify Landlord as set forth in this
Section shall be limited to the extent of Tenant's negligence, and that of its
agents, employees, sublessees, invitees, licensees or contractors, including
Tenant's proportional share of costs, attorneys' fees and expenses incurred in
connection with any claim, action or proceeding brought with respect to such
injury or damage.

C. EXCEPTION. Neither Landlord nor its trustees, general partners, limited
partners, agents, employees or contractors of Landlord shall be liable (1) for
any such damage caused by other Tenants or persons in or about the Building; (2)
caused by public or quasi-public work; or (3) for consequential damages arising
out of any loss of the use of the Premises of any equipment or facilities
therein by Tenant or any person claiming through or under Tenant; except to the
extent caused solely by the gross negligence or willful misconduct of Landlord.

                         19. DAMAGE TO TENANT'S PROPERTY

Notwithstanding the provisions of the preceding Section to the contrary (except
in the event of concurrent negligence by Landlord and Tenant as governed above),
Landlord, its trustees, general partners, limited partners, agents, employees or
contractors, shall not be liable for (A) any damage to any property entrusted to
employees of the Building (B) loss or damage to any property by theft or
otherwise, or (C) any injury or damage to persons or property resulting from
fire, earthquake, explosion, falling plaster, steam, gas, electricity, water or
rain which may leak from any part of the Building or from the pipes, appliances
or plumbing work therein or from the roof, street or sub-surface or from any
other place or resulting from dampness or any other cause whatsoever. Landlord,
its trustees, general partners, limited partners, agents, employees or
contractors, be liable for any latent defect in the Premises or in the Building.
Tenant shall give prompt notice to Landlord in case of fire or accidents in the
Premises or in the Building or defects therein or in the fixtures or equipment.

WESTSOUND PLAZA LEASE-12

<PAGE>

                                  20. INSURANCE

A. TENANT'S INSURANCE. Tenant shall, during the term hereof and any other period
of occupancy, at its sole cost and expense, keep in full force and effect the
following insurance:

     1.   Standard form property insurance against the perils of fire, extended
          coverage, vandalism, malicious mischief, special extended coverage
          ("All-Risk") glass coverage and sprinkler leakage. This insurance
          policy shall be upon all property owned by Tenant, for which Tenant is
          legally liable or that was installed at Tenant's expense, and which is
          located in the Building including, without limitation, furniture,
          fittings, installations, fixtures (other than Tenant Improvements
          installed by Landlord), and any other personal property, in an amount
          not less than ninety percent (90%) of the full replacement costs
          thereof. In the event that there shall be a dispute as to the amount
          which comprises full replacement cost, the decision of Landlord or any
          Mortgagees of Landlord as defined in this Lease shall be conclusive.
          This insurance policy shall also be upon direct or indirect loss of
          Tenant's earnings attributable to Tenant's inability to use fully or
          obtain access to the Premises or Building in an amount as will
          properly reimburse Tenant. Such policy shall name Landlord and any
          Mortgagees of Landlord as insured parties, as their respective
          interests may appear;

     2.   Comprehensive General Liability Insurance insuring Tenant against any
          liability arising out of the lease, use, occupancy or maintenance of
          the Premises and all areas appurtenant thereto, such insurance shall
          be in the amount of at least $1,000,000 Combined Single Limit for
          Injury to, or death of one or more persons in an occurrence, and for
          damage to tangible property (including loss of use) in an occurrence,
          such liability amount may be adjusted by Landlord from time to time
          upon written notice to Tenant. The Policy shall insure the hazards of
          the Premises and Tenant's operations thereon, independent contractors,
          contractual liability (covering the indemnity contained in Section 18
          hereof) and shall: (A) name Landlord as an additional insured; (B)
          contain a cross liability provision; and (C) contain a provision that
          the insurance provided by the Tenant hereunder shall be primary and
          that other insurance available to the Landlord shall be
          non-contributing;

     3.   Workers' Compensation and Employer's Liability insurance as required
          by law;

     4.   Any other form or forms of insurance as Tenant or Landlord or any
          Mortgagees or Landlord may reasonably require from time to time in
          order to protect Landlord, other tenants of the Building, or any
          Mortgagee of Landlord, or if required by law or regulation.

B. FORM. All insurance policies shall be written in a form and with an insurance
company reasonably satisfactory to Landlord. Within ten (10) days after Tenant
takes possession of the Premises, Tenant shall deliver to Landlord copies of
policies or certificates evidencing the existence of the amounts, and form of
coverage required by this Lease. Tenant shall, within ten (10) days prior to the
expiration of such policies, furnish Landlord with renewals or "binders"
thereof, or Landlord may order such insurance and charge the cost thereof to
Tenant as

WESTSOUND PLAZA LEASE-13

<PAGE>

Additional Rent. If Landlord obtains any insurance that is the responsibility of
Tenant under this Section, Landlord shall deliver to Tenant a written statement
setting forth the costs of any such insurance and showing in reasonable detail
the manner in which it has been computed.

C. LANDLORD'S INSURANCE. During the Lease Term, Landlord shall insure the
Building (excluding any property which Tenant is obligated to insure) against
damage with fire and other forms of physical damage insurance as well as public
liability insurance, all in such amounts and with such deductibles as Landlord
considers appropriate. Landlord may, but shall not be obligated to, obtain and
carry any other form or forms of insurance as it or Landlord's Mortgagees may
determine advisable. Notwithstanding any contribution by Tenant to the cost of
insurance premiums, as provided herein, Tenant acknowledges that it has no
right to receive any proceeds from any insurance policies carried by Landlord.

D. DUTY OF TENANT. Tenant will not keep, sell or offer for sale in or upon the
Premises any article which may be prohibited by any insurance policy
periodically in force covering the Building. If Tenant's occupancy, use, or
business in, or on the Premises, whether or not Landlord has consented to the
same, results in any increase in premiums for the insurance periodically carried
by Landlord with respect to the Building, Tenant shall pay any such increase in
premiums as Additional Rent within ten (10) days after being billed therefore by
Landlord. In determining whether increased premiums are a result of
Tenant's use of the Premises, a schedule issued by the organization computing
the insurance rate on the Building or the Tenant Improvements showing the
various components of such rate, shall be conclusive evidence of the several
items and charges which make up such rate. Tenant shall promptly comply with all
reasonable requirements of any present or future insurer relating the Premises.

E. CANCELLATION. If any of Landlord's insurance policies shall be canceled or
cancellation shall be threatened or the coverage thereunder reduced or
threatened to be reduced in any way because of the use of the Premises or any
part thereof by Tenant, its agents, employees, agents or invitees or any
assignee or sublessee of Tenant or by anyone Tenant permits on the Premises and,
if Tenant fails to remedy the condition giving rise to such cancellation,
threatened cancellation, reduction of coverage, threatened reduction of
coverage, increase in premiums, or threatened increase of premiums, within
forty-eight (48) hours after notice thereof, Landlord may, at its option, either
terminate this Lease or enter upon the Premises and attempt to remedy such
condition, and Tenant shall promptly pay the costs thereof to Landlord as
Additional Rent. In such event, Landlord shall not be liable for any damage or
injury caused to any property of Tenant or of others and Landlord shall have all
of the remedies provided for in this Lease in the event of a default by Tenant.
Notwithstanding the foregoing provisions of this Section, if Tenant fails to
remedy as aforesaid, Tenant shall be in default of its obligation hereunder and
Landlord shall have no obligation to remedy such default.

F. SUBROGATION. All policies of insurance required hereunder shall include a
clause or endorsement denying the insurer any rights of subrogation against the
other party to the extent rights have been waived by the insured before the
occurrence of injury or loss. Landlord and Tenant waive any rights to recovery
against the other for injury or loss due to hazards covered by policies of
insurance containing such a waiver of subrogation clause or endorsement to the
extent of the injury or loss covered thereby.

WESTSOUND PLAZA LEASE-14

<PAGE>

                            21. DAMAGE OR DESTRUCTION

A. TOTAL DESTRUCTION. In the event of the total destruction of the Premises
and/or the Building (Defined as destruction equal to or exceeding 25% of the
full insurable value of the Premises and/or Building), Landlord shall, at
Landlord's sole option, either commence repair, reconstruction and restoration
of the Building and/or the Premises as soon as reasonably possible and prosecute
the same diligently to completion, in which event this Lease shall remain in
full force and effect; or, within sixty (60) days after such destruction, elect
not to so repair, reconstruct or restore the Building and/or the Premises, in
which event this Lease shall terminate. In either event, Landlord shall give
Tenant written notice of its intention within said sixty (60) day period. In the
event Landlord elects not to restore the Building and/or Premises, this Lease
shall be deemed to have terminated as of the date of such total destruction.

B. PARTIAL DESTRUCTION. In the event of a partial destruction of the Building
and/or the Premises (defined as destruction of less than twenty-five percent
(25%) of the full insurable value of the Premises and/or Building) and if the
damage thereto is such that the Building and/or the Premises may be repaired,
reconstructed or restored within a period of ninety (90) days from the date of
the happening of such a casualty, and if Landlord will receive insurance
proceeds sufficient to cover the cost of all such repairs, then Landlord shall
commence and proceed diligently with the work of repair, reconstruction and
restoration and this Lease shall continue in full force and effect. If such work
of repair, reconstruction and restoration shall require a period longer than
ninety (90) days or if Landlord will not receive insurance proceeds sufficient
to cover the cost of all such repairs, then Landlord either may elect to so
repair, reconstruct or restore and the Lease shall continue in full force and
effect or Landlord may elect not to repair, reconstruct or restore and the Lease
shall then terminate. Under any of the conditions of this Section, Landlord
shall give written notice to Tenant of its intention within sixty (60) days of
the partial destruction. In the event Landlord elects not to restore the Common
Areas and/or the Premises, this Lease shall be deemed to have terminated as of
the date of such partial destruction.

C. TERMINATION. Upon the termination pursuant to the terms of this Paragraph 21,
the parties shall be released without further obligation to the other from the
date possession of the Premises is surrendered to Landlord except for items
which have therefore accrued and are then unpaid. Notwithstanding the provisions
of Sections 21 A and B above, if total or partial destruction is due to any
cause other than fire or other peril covered by extended coverage insurance,
Landlord may elect to terminate this Lease.

D. ABATEMENT. In the event of repair, reconstruction and/or restoration by
Landlord as herein provided, the Rental payable under this Lease shall be abated
proportionately with the degree to which Tenant's use of the Premises is
impaired during the period of such repair, reconstruction or restoration;
provided that there shall be no abatement of Rent if such damage is the result
of Tenant's act, omission or negligence of that of its agents, employees,
sublessee, invitee, or licensees. In the event of concurrent negligence,
Tenant's Rent shall be abated proportionately in an amount equal to the extent
Tenant is not negligent. Tenant shall not be entitled to any compensation or
damages for loss in the use of the whole or any part of the Premises and/or any
inconvenience or annoyance occasioned by such damage, repair, reconstruction or
restoration.

WESTSOUND PLAZA LEASE-15

<PAGE>

E. DELAYS. Tenant shall not be released from any of its obligations under this
Lease except to the extent and upon the conditions expressly stated in this
Section. Notwithstanding anything to the contrary contained this Section, if
Landlord is delayed or prevented from repairing or restoring the damaged
Building, Common Areas and/or Premises within ninety (90) days after the
occurrence of such damage or destruction by reason of acts of God, war,
governmental, restrictions, inability to procure the necessary labor or
materials, or other cause beyond the reasonable control of Landlord, Landlord
may terminate this Lease, whereupon Landlord shall be relieved of its obligation
to make such repairs or restoration and Tenant shall be released from its
obligations under this Lease as of the end of said ninety (90) day period.

F. EXTENT. If Landlord is obligated to or elects to repair or restore as herein
provided, Landlord shall be obligated to make repair or restoration only of
those portions of the Building, Common Areas and/or the Premises which were
originally provided at Landlord's expense, and the repair and restoration of
items not provided at Landlord's expense shall be the obligation of Tenant.
Landlord shall perform repairs in a timely and workmanlike manner.

G. WAIVER. Landlord and Tenant hereby waive the provisions of any statutes or
court decisions which relate to the abatement or termination of leases when
leased property is damaged or destroyed and agree that such event shall be
exclusively governed by the terms of this Lease.

                               22. EMINENT DOMAIN

In case all of the Property, the Premises, Building, or such part thereof as
shall substantially interfere with either Landlord's or Tenant's use and
occupancy thereof, shall be taken for any public or quasi-public purpose by any
lawful power or authority by exercise of the right of appropriation,
condemnation or eminent domain, or sold to prevent such taking, either party
shall have the right to terminate this Lease effective as of the date possession
is required to be surrendered to said taking authority. Also if Landlord
determines, in the event of a taking of all or a part of the Common Areas that
any such taking will prohibit or inhibit ingress or egress to the Premises or
the Building, or will interfere with parking in the Building or areas necessary
for or to operation of the Building, Landlord shall have the right to terminate
this Lease effective as of the date possession is required to be surrendered to
said taking authority. Tenant shall not assert any claim against Landlord for
any compensation because of such taking, and Landlord shall be entitled to
receive the entire amount of any award resulting from said taking without
deduction for any estate or interest of Tenant. In the event the amount of
property and type of estate taken shall not substantially interfere with the
conduct of Tenant's business, or, with respect to the Common Areas, Landlord
determines it will not interfere with ingress and egress to the Building,
parking or areas necessary to the operation of the Building and Landlord
determines in its sole discretion Landlord is economically able to restore the
Premises and/or the Building to an operating entity comparable to that which
existed prior to the taking, Landlord shall restore the area affected by the
taking. If a portion of the Premises was affected by such taking, a
proportionate allowance shall be made to Tenant for the Rent corresponding to
the time during which, and to the part of the Premises which Tenant shall be so
deprived on account of such taking and restoration. Tenant shall not have the
right to make a separate claim with the condemning authority for the value of
Tenant's property and leasehold interest and/or moving and relocation expenses.

WESTSOUND PLAZA LEASE-16

<PAGE>

                            23. DEFAULTS AND REMEDIES

A. EVENTS OF DEFAULT. The occurrence of any one or more of the following events
shall constitute a default hereunder by Tenant:

     1. The vacation or abandonment of the Premises by Tenant. Abandonment and
     vacation are herein defined to include, but are not limited to an absence
     by Tenant from the premises for ten (10) successive business days or
     longer;

     2. The failure by Tenant to pay Rent, Additional Rent or make any other
     payment required to be made by Tenant hereunder, within ten (10) days of
     written notice of the date when due;

     3. The failure by Tenant to observe or perform any of the express or
     implied covenants or provisions of this Lease and Rules and Regulations to
     be observed or performed by Tenant, where such failure shall continue for a
     period of ten (10) days after written notice thereof from Landlord to
     Tenant. If the nature of Tenant's default is such that more than ten (10)
     days are reasonably required, in the Landlord's sole discretion, for its
     cure, then Tenant shall not be deemed to be in default if Tenant shall
     commence such cure within ten (10) day period and thereafter diligently
     prosecute such cure to completion, which completion shall occur not later
     than sixty (60) days from the date of such notice from Landlord;

     4. (A) The making by Tenant if any general assignment for the benefit for
     creditors: (B) the filing by or against Tenant of a petition to have Tenant
     adjudged a bankrupt or a petition for reorganization or arrangement under
     any law relating to bankruptcy (unless, in the case of a petition filed
     against Tenant, the same is dismissed within sixty (60) days); (C) the
     attachment, execution or other judicial seizure of substantially all of
     Tenant's assets located at the Premises of Tenant's interest in this Lease
     where such seizure is not discharged within thirty (30) days; or (D) the
     appointment of a receiver for Tenant or any of Tenant's assets;

B. REMEDIES. In the event of any such default by Tenant, in addition to any
other remedies available to Landlord at law or in equity, Landlord shall have
the immediate option to re-enter the Premises as set out in Paragraph C
hereafter. In the event of such re-entry, Landlord may recover from Tenant:

     1. Any unpaid Rent which had been earned at the time of such termination;
     plus

     2. The amount of unpaid Rent for the balance of the Lease Term; plus

     3. Any other amount necessary to compensate Landlord for all the detriment
     proximately caused by Tenant's failure to perform Tenant's obligation under
     this Lease.

C. RE-ENTRY. In the event of any such default by Tenant, Landlord shall also
have the right without notice, with or without terminating this Lease, to
re-enter the Premises and remove all

WESTSOUND PLAZA LEASE-17

<PAGE>

persons and property from the Premises; such property may be removed and stored
in a public warehouse or elsewhere at the cost of and for the account of Tenant.
No re-entry or taking possession of the Premises by Landlord pursuant to this
Section shall be construed as an election to terminate this Lease unless a
written notice of such intention is given to Tenant or unless the termination
thereof is decreed by a court of competent jurisdiction.

D. ABANDONMENT. In the event of the vacation or abandonment of the Premises by
Tenant or in the event that Landlord shall elect to re-enter as provided in
Section 23C above or shall take possession of the Premises pursuant to legal
proceeding or pursuant to any notice provided by law, then if Landlord does not
elect to terminate this Lease as provided above, Landlord may from time to time,
without terminating this Lease, either recover all Rent as it becomes due or re-
let the Premises or any part thereof for the term of this Lease on terms and
conditions as Landlord in its sole discretion may deem advisable with the right
to make alterations and repairs to the Premises.

E. RELETTING. In the event that Landlord shall elect to so re-let, then Rentals
received by Landlord from such re-letting shall be applied first, to the payment
of any indebtedness other than Rent due hereunder from Tenant to Landlord;
second, to the payment of any cost of such re-letting; third, to the payment of
the cost of any alterations and repairs to the Premises; fourth, to the payment
of Rent due and unpaid hereunder and the residue, if any, shall be held by
Landlord and applied to payment of future Rent as the same may become due and
payable hereunder. Should the portion of such Rentals received from such
re-letting during any month, which is applied to the payment of Rent hereunder,
be less than the Rent payable during that month by Tenant hereunder, then Tenant
shall pay such deficiency to Landlord immediately upon demand therefore by
Landlord.

F. CUMULATIVE REMEDIES. All rights, options and remedies of Landlord contained
in this Lease shall be construed and held to be cumulative, and no one of them
shall be exclusive of the other, and Landlord shall have the right to pursue any
one or all of such remedies or any other remedy or relief which may be provided
by law, whether or not stated in this Lease.

                               24. ASSIGNMENT AND SUBLETTING

Tenant shall not voluntarily or involuntarily assign, encumber, hypothecate,
sublease all or any part of the Premises or otherwise transfer (hereinafter
collectively referred to as "Assignment") its interest in this Lease or in the
Premises, without first obtaining Landlord's prior written consent which consent
may not be unreasonably withheld. An assignment shall not release Tenant from
any obligations hereunder. Except as specified herein, any Assignment without
Landlord's prior consent, shall be voidable at Landlord's election and shall
constitute a default. Except as specified herein, if Tenant is a corporation,
any transfer of this Lease from Tenant by merger, consolidation or liquidation,
or any change in the ownership of the corporation, shall constitute an
Assignment for the purposes of this Section. If Tenant is a partnership, any
transfer of this Lease of dissolution, or any change in the ownership of the
Partnership, shall constitute an Assignment for the purposes of this Section. No
consent to an Assignment shall constitute a further waiver of the provisions of
this Section.

WESTSOUND PLAZA LEASE-18

<PAGE>

                                25. SUBORDINATION

A. Without the necessity of any additional document being executed by Tenant for
the purpose of effective subordination, and at the election of Landlord or any
Mortgagee, this Lease shall be subject and subordinate at all times to:

     1. All ground leases or underlying leases which may now exist or hereafter
     be executed affecting the Building or the Property upon which the Building
     is situated or both;

     2. The lien of any Mortgage or Deed of Trust which may now exist or
     hereafter be executed in any amount for which the Building, Property,
     underlying leases, or Landlord's interest or estate in any of said items is
     specified as security.

B. Notwithstanding the foregoing, Landlord shall have the right to subordinate
or cause to be subordinated any such ground Leases or underlying leases or any
such liens to this Lease. In the event that any mortgage is foreclosed or a
conveyance in lieu of foreclosure is made for any reason. Tenant shall,
notwithstanding any subordination, attorn to and become the Tenant of the
success-in-interest to Landlord, at the option of such successor-in-interest.
Tenant covenants and agrees to execute and deliver, upon demand by Landlord and
in the form requested by Landlord, any additional documents evidencing the
priority of subordination of this Lease with respect to any such underlying
leases or the lien of any such Mortgage. Should Tenant fail to sign and return
any such documents within twenty (20) business days of request, Tenant shall be
in default, and Landlord may, at Landlord's option, terminate this Lease
provided written notice of such termination is received by Tenant prior to
Landlord's receipt of such documents executed by Tenant. Tenant hereby
irrevocably appoints Landlord as attorney-in-fact of Tenant to execute, deliver
and record any such documents in the name and on behalf of the Tenant.

C. In the event of any such subordination of this Lease, Tenant's possession of
the Premises shall remain undisturbed and Tenant's rights under this Lease shall
be recognized and shall not be adversely affected so long as Tenant is not in
default under this Lease.

                            26. ESTOPPEL CERTIFICATES

A. Within ten (10) days following any written request which Landlord may make
from time to time, Tenant shall execute and deliver to Landlord a statement
certifying: (I) the Commencement Date of this Lease; (II) the fact that this
Lease is unmodified and in full force and effect (or, if there have been
modifications hereto, that this Lease is in full force and effect, and stating
the date and nature of such modifications): (III) the date to which the Rent and
other sums payable under this Lease have been paid; (IV) that there are no
current defaults under this Lease by either Landlord or Tenant except as
specified in Tenant's statement; and (V) such other matters as are reasonably
requested by Landlord. Landlord and Tenant intend that any statement delivered
pursuant to this Section may be relied upon by any Mortgage, ground lessor,
purchaser or prospective purchaser of the Building, the Property or any interest
therein.

WESTSOUND PLAZA LEASE-19

<PAGE>

B. Tenant's failure to deliver such statement within such time shall be
conclusive upon Tenant (I) that this Lease is in full force and effect, without
modification except as may be represented by Landlord (II) that there are no
uncured defaults in Landlord's performance; and (III) that not more than one (1)
month's Rental has been paid in advance, and Tenant hereby irrevocably appoints
Landlord as attorney-in-fact of Tenant to execute, deliver and record estoppel
certificates in the name and on behalf of Tenant.

                               27. HAZARDOUS WASTE

A. PRESENCE AND USE OF HAZARDOUS SUBSTANCES. Tenant shall not, without
Landlord's prior written consent, keep on or around the Project, Property,
Premises, Common Areas or Buildings, for use, disposal, treatment
transportation, generation, storage or sale or any other purpose, any substances
designated as, or containing components designated as hazardous, dangerous,
infectious, toxic or harmful (collectively referred to as "Hazardous
Substances") and/or is subject to regulation by any federal, state or local law,
regulation, statute or ordinance. With respect to any such Hazardous Substance,
Tenant shall:

     1. Comply promptly, timely, and completely with all government requirements
     for reporting, keeping and submitting manifests, and obtaining and keeping
     current identification numbers;

     2. Submit to Landlord true and correct copies of all reports, manifests and
     identification numbers at the same time as they are required to be and/or
     are submitted to the appropriate governmental authorities;

     3. Within five (5) days of Landlord's request, submit written reports to
     Landlord regarding Tenant's use, storage, treatment, transportation,
     generation, disposal or sale of Hazardous Substances and provide evidence
     satisfactory to Landlord of Tenant's compliance with the applicable
     government regulations;

     4. Allow Landlord or Landlord's agent or representative to come on the
     Premises at all times to check Tenant's compliance with all applicable
     governmental regulations regarding Hazardous Substances;

     5. Comply with minimum levels, standards or other substances or
     requirements which may be set forth or established for certain Hazardous
     Substances (if minimum standards or levels are applicable to Hazardous
     Substances present on the premises, such levels or standards shall be
     established by an on-site inspection by the appropriate governmental
     authorities and shall be set forth in an Addendum to the Lease); and

     6. Comply with all applicable governmental rules, regulations and
     requirements regarding the proper and lawful use, sale, transportation,
     generation, storage, treatment and disposal of Hazardous Substances. Any
     and all costs incurred by Landlord and associated with any violation of
     said governmental rules, regulations, or requirements by Tenant shall be
     paid by Tenant as additional rent and shall be due and payable immediately
     upon demand by Landlord.

WESTSOUND PLAZA LEASE-20

<PAGE>

B. CLEANUP COSTS, DEFAULT AND INDEMNIFICATION

     1. Tenant shall be fully and completely liable to Landlord for any and all
     cleanup costs, and any and all other charges, fees, penalties (civil and
     criminal) imposed by any governmental authority with respect to Tenant's
     use, disposal, storage, transportation, generation and/or sale of Hazardous
     Substances, in or about the Project, Property, Premises, Common Areas or
     Building.

     2. Tenant shall indemnify, defend and save Landlord harmless from any and
     all of the costs, fees, penalties and charges assessed against or imposed
     upon Landlord (as well as Landlord's attorney's fees and costs) as a result
     of Tenant's use, disposal, transportation, generation and/or sale of
     Hazardous Substances.

     3. Upon Tenant's default under this Section in addition to the rights and
     remedies set forth elsewhere in this Lease, Landlord shall be entitled to
     the following rights and remedies:

          A. At Landlord's option, to terminate this Lease immediately; and/or

          B. To recover any and all damages associated with the default,
          including, but not limited to cleanup costs and charges, civil and
          criminal penalties and fees, loss of business and sales by Landlord
          and other tenants of the Building or Project, any and all damages and
          claims asserted by third parties and Landlord's attorney's fees and
          costs.

                            28. RULES AND REGULATIONS

Tenant shall faithfully observe and comply with the reasonable Rules and
Regulations which may be promulgated by Landlord from time to time. Landlord
shall not be responsible to Tenant for the violation or non-performance by any
other tenant or occupant of the Building of any said Rules and Regulations.

                              29. CONFLICT OF LAWS

This Lease shall be governed by and construed pursuant to the laws of the State
of Washington. Exclusive venue and jurisdiction of any dispute arising out of or
relating to the Lease, or Tenant's use and/or occupancy of the Premises, shall
be in the State and Federal Courts located in Kitsap County, Washington.

                           30. SUCCESSORS AND ASSIGNS

Except as otherwise provided in this Lease, all of the covenants, conditions and
provisions of this Lease shall be binding upon and shall inure to the benefit of
the parties hereto and their respective heirs, personal representatives,
successors and assigns.

WESTSOUND PLAZA LEASE-21

<PAGE>

                            31. SURRENDER OF PREMISES

The voluntary or other surrender of this Lease by Tenant, or a mutual
cancellation thereof, shall not work a merger, and shall, at the option of
Landlord, operate as an Assignment to it of any or all subleases. Upon
expiration or termination of this Lease, Tenant shall peaceably surrender the
Premises and all alterations and additions thereto, broom clean the Premises,
remove all trade fixtures, leave the Premises in good order, repair and
condition, reasonable wear and tear expected, and comply with the provisions
herein. The delivery of keys to any employee of Landlord or to Landlord's agent
or any employee thereof shall not be sufficient to constitute a termination of
this Lease or surrender of the Premises.

                              32. PROFESSIONAL FEES

A. If Landlord should bring suit for possession of the Premises, for the
recovery of any sum due under this Lease, or because of the breach of any
provisions of this Lease, or for any other relief against Tenant hereunder, or
in the event of any other litigation between the parties with respect to this
Lease, or if Landlord incurs any legal or professional fees in its attempt to
enforce this Lease, whether or not such enforcement efforts proceed to the
filing of a lawsuit, then all reasonable costs and expenses, including without
limitation, its reasonable actual professional fees such as appraisers',
accountants', and attorneys' fees (including those on appeal), incurred therein
shall be paid by Tenant. If Landlord employs a collection agency to recover
delinquent charges, Tenant agree to pay all reasonable collection agency fees
charged to Landlord in addition to Rent, late charges, interest and other
reasonable sums payable under this Lease.

B. If Landlord is named as a defendant in any suit brought against Tenant in
connection with or arising out of Tenant's occupancy hereunder, Tenant shall pay
to Landlord its costs and reasonable expenses incurred in such suit, including
without limitation, its actual reasonable professional fees such as appraisers',
accountants' and attorneys' fees, unless such action is the result of the sole
negligence of the Landlord.

                            33. PERFORMANCE BY TENANT

All covenants and agreements to be performed by Tenant under any of the terms of
this Lease shall be performed by Tenant at Tenant's sole cost and expense and
without any abatement of Rent except as specifically provided herein. If Tenant
shall fail to pay any sum of money owed to any party other than Landlord, for
which it is liable hereunder, of if Tenant shall fail to perform any other act
on its part to be performed hereunder, and such failure shall continue for ten
(10) days after notice thereof by Landlord, Landlord may, without waiving or
releasing Tenant from obligations of Tenant, but shall not be obligated to, make
any such payment or perform any such other act to be made or performed by
Tenant. All sums so paid by Landlord and all incidental costs together with
interest thereon at the rate equal to the prime commercial rate of interest in
effect at the time of such payment as published from time to time by the Wall
Street Journal, plus two percent (2%) from the date of such payment by Landlord,
shall be payable by Tenant to Landlord on demand. Tenant covenants to pay any
such sums, and Landlord shall have (in addition to any other right or remedy of
Landlord) all rights and remedies in the event of the non-payment thereof by
Tenant as are set forth in Section 23.

WESTSOUND PLAZA LEASE-22

<PAGE>

                                 34. MORTGAGEES

If Tenant elects to terminate this Lease upon Landlord's default, Tenant must
notify any Mortgagee whose address shall have been furnished to Tenant, at lease
ninety (90) days in advance of the proposed effective date of such termination.
For purposes of this Lease, "Mortgagees" shall include all mortgagees or holders
of a beneficial interest in a Deed of Trust constituting a lien on the Project
or any portion thereof. During this ninety (90) day period, the Mortgagee may
commence to curing the default. If the default cannot be cured within this
ninety (90) day period, the Lease shall not be terminated if the Mortgagee or
ground lessor have made diligent efforts to cure the default within said ninety
(90) day period and have diligent efforts. If default is one which is not
susceptible of cure by the Mortgagee within this ninety (90) day period because
the Mortgagee is not in possession of the Building or Property, this ninety (90)
day period shall be extended to include time needed to obtain possession of the
Premises by the Mortgagee by power of sale or a judicial foreclosure or other
legal means, provided that right to possession is pursued with due diligence.

                           35. DEFINITION OF LANDLORD

The term "Landlord" as used in this Lease, so far as covenants or obligations on
the part of Landlord are concerned, shall be limited to mean and include only
the owner or owners, or a ground lessee, at the time in question, of the fee
title of the Premises. In the event of any transfer, assignment or other
conveyance or transfers of any such title, Landlord herein named (and in case of
any subsequent transfers or conveyances, the then grantor) shall be
automatically freed and relieved from and after the date of such transfer,
assignment or conveyance of all liability as respects the performance of any
covenants of this Lease, and the transferee(s), grantee(s) or assignee(s) shall
be deemed to have assumed and agreed to observe and perform any and all
obligations of Landlord hereunder. Landlord may assign or transfer any and all
obligations of Landlord hereunder during its ownership of the Premises. Landlord
may transfer its interest in the Premises without the consent of Tenant
and such transfer or subsequent transfer shall not be deemed a violation on
Landlord's part of any of the terms and conditions of this Lease.

                                   36. WAIVER

The waiver by Landlord or Tenant or any breach of any term, covenant or
condition herein contained shall not be deemed to be a waiver of any subsequent
breach of the same or any other term covenant or condition herein contained, nor
shall any custom or practice which may grow up between the parties in the
administration of the terms hereof be deemed a waiver of or in any way affect
the right of Landlord to insist upon the performance by Tenant in strict
accordance with said terms. The subsequent acceptance by Landlord of Rent or
other payments due Landlord hereunder shall not be deemed to be a waiver of any
preceding breach by Tenant of any term, covenant or condition of this Lease,
other than the failure of Tenant to pay the particular Rent or other payment so
accepted regardless of Landlord's knowledge of such preceding breach at the time
of acceptance of such Rent. No acceptance by Landlord of a lesser sum than the
Rent or other sum then due shall be deemed to be other than on account of the
earliest installment of such Rent or other sum then due, and Landlord may accept
such check or payment without

WESTSOUND PLAZA LEASE-23

<PAGE>

prejudice to Landlord's right to recover the balance of such amount due or
pursue any other remedy available to Landlord pursuant to this Lease or
otherwise. The consent or approval of Landlord to or of any act by Tenant
requiring Landlord's consent or approval shall not be deemed to waive or render
unnecessary Landlord's consent to or approval of any subsequent similar acts by
Tenant.

                                37. SIGN CONTROL

Tenant shall not affix, paint, erect or inscribe any sign, projection, awning,
signal or advertisement of any kind to any part of the Premises, Building or
Project, including without limitation, the inside or outside of windows or
doors, without the written consent of Landlord. Landlord shall have the right to
remove any signs or other matter, installed without Landlord's permission,
without being liable to Tenant by reason of such removal, and to charge the cost
of removal to Tenant as Additional Rent hereunder, payable within ten (10) days
of written demand by Landlord. Landlord reserves the right to establish or
change sign policies and to bring any of Tenant's existing signs into compliance
with any such policies, or to relocate Tenant's sign(s), at Landlord's expense.
Tenant may display a sign subject to Landlord's approval in directory, at
Tenant's expense and for a monthly rental of twenty dollars ($20.00) per month.

                                   38. PARKING

Tenant and Tenant's employees may use the parking facilities upon such terms and
conditions as may from time to time be established by Landlord and upon the
terms and conditions set forth in the Rules and Regulations; provided, however,
that there will be two (2) customer parking stalls reserved in the principal
parking area of the demised premises. Landlord consents to Tenant placing
appropriate "customer only" signs on those two (2) stalls.

                                39. FORCE MAJEURE

Landlord shall have no liability whatsoever to Tenant on account of: (A) the
inability of Landlord to fulfill, or delay in fulfilling, any of Landlord's
obligations under this Lease by reason of strike, other labor trouble,
governmental preemption or priorities or other controls in connection with a
national or other public emergency, or shortages of fuel, supplies or labor
resulting therefrom or any other cause, whether similar or dissimilar to the
above, or acts of God, beyond Landlord's reasonable control; or (B) any failure
or defect in the supply, quantity or character of electricity, gas, water, or
any other utility furnished to the Premises by reason of any requirements, act
or omission of any public or private utility, or other entity furnishing the
Building with such utilities, or for any other reason, whether similar or
dissimilar to the above, beyond Landlord's reasonable control. If this Lease
specifies a time period for performance of an obligation of Landlord, that time
period shall be extended by the period of any delay in Landlord's performance
caused by any of the above-described or events of force majeure.

                             40. TERMS AND HEADINGS

The words "Landlord" and "Tenant" as used herein shall include the plural as
well as the singular. Words used in any gender include other genders. The
Section headings of this Lease

WESTSOUND PLAZA LEASE-24

<PAGE>

are not a part of this Lease and shall have no effect upon the construction or
interpretation of any part hereof.

                                    41. TIME

Time is of the essence with respect to the performance of every provision of
this Lease in which time of performance is a factor.

                        42. PRIOR AGREEMENT OR AMENDMENTS

This Lease contains all of the agreements of the parties hereto with respect to
any matter covered or mentioned in the Lease and no prior agreement or
understanding pertaining to any such matter shall be effective for any purpose
unless contained in a writing executed by the party sought to be bound, on the
same date or a date subsequent to the execution of this Lease. No provisions of
this Lease may be amended or added to except by an agreement in writing signed
by the parties hereto or their respective successors-in-interest.

                                43. SEVERABILITY

Any provisions of this Lease which shall prove to be invalid, void or illegal in
no way affects, impairs or invalidates any other provisions hereof, and such
other provisions shall remain in full force and effect.

                                  44. RECORDING

Tenant shall not record this Lease nor a short form memorandum thereof without
the prior consent of the Landlord. Landlord may in its sole discretion record
this Lease or a memorandum thereof.

                           45. LIMITATION OF LIABILITY

In the event of any alleged failure, breach or default hereunder by Landlord,
the sole and exclusive remedy shall be against the Landlord's interest in the
building and his liability insurance benefits.

                           46. MODIFICATION FOR LENDER

Notwithstanding anything to the contrary contained in this Lease, if, in
connection with obtaining construction, interim or permanent financing for the
Building and/or the Project the Lender shall request reasonable modifications in
this Lease as a condition to such financing, Tenant will not unreasonably
withhold, delay or defer its consent thereto, provided that such modifications
do not increase the obligations of Tenant hereunder or materially adversely
affect the leasehold interest hereby created or Tenant's rights hereunder.

WESTSOUND PLAZA LEASE-25

<PAGE>

                               47. QUIET ENJOYMENT

Landlord covenants and agrees with Tenant that upon Tenant paying the Rent
required under this Lease and paying all other charges and performing all of the
covenants and provisions aforesaid on Tenant's part to be observed and performed
under this Lease, and if Tenant is in compliance with the Rules and Regulations
and Conditions, Covenants and Restrictions, Tenant shall and may peaceably and
quietly have, hold, and enjoy the Premises in accordance with the Lease,
provided that, Tenant's rights hereunder shall be subject to the provisions
herein with respect to start-up inconveniences.

                            48. TENANT AS CORPORATION

If Tenant executes this Lease as a corporation, then Tenant and the person
executing this Lease on behalf of Tenant represent and warrant that the
individuals executing this Lease on Tenant's behalf are duly authorized to
execute and deliver this Lease on its behalf in accordance with a duly adopted
resolution of the Board of Directors of Tenant, a copy of which is to be
delivered to Landlord on execution hereof, and in accordance with the Bylaws of
Tenant and that this Lease is binding upon Tenant in accordance with its terms.

                          49. MISCELLANEOUS PROVISIONS

Any term of this Lease which requires Landlord's consent or approval shall be
construed to include the following words:

     "which consent or approval shall not be unreasonably withheld."

LANDLORD:                                TENANT:
                                         WESTSOUND BANK

/s/ LOUIS WEIR                10-1-03    By: /s/ David K. Johnson        10-1-03
---------------------------   Date           --------------------------  Date
LOUIS WEIR                                   Its President

/s/ DELORES WEIR              10-1-03
---------------------------   Date
DELORES WEIR

WESTSOUND PLAZA LEASE-26

<PAGE>

STATE OF WASHINGTON     )
                        ) ss.
COUNTY OF KITSAP        )

I certify that I know or have satisfactory evidence that Louis J. Weir is the
individual who appeared before me, and said individual acknowledged that he
signed this instrument and acknowledged it to be his free and voluntary act for
the uses and purposes mentioned in the instrument.

Dated:
       -----------                     ----------------------------------------
                                       Notary Public
                                       Print Name: ____________________________
                                       NOTARY PUBLIC in and for the
                                       State of Washington, residing at
                                       ________________________________________.
                                       My commission expires: _________________.

STATE OF WASHINGTON     )
                        ) ss.
COUNTY OF KITSAP        )

I certify that I know or have satisfactory evidence that Delores Weir is the
individual who appeared before me, and said individual acknowledged that she
signed this instrument and acknowledged it to be her free and voluntary act for
the uses and purposes mentioned in the instrument.

Dated:
       -----------                     ----------------------------------------
                                       Notary Public
                                       Print Name: ____________________________
                                       NOTARY PUBLIC in and for the
                                       State of Washington, residing at
                                       ________________________________________.
                                       My commission expires: _________________.

STATE OF WASHINGTON     )
                        ) ss.
COUNTY OF KITSAP        )

I certify that I know or have satisfactory evidence that David Johnson is the
person who appeared before me, and said person acknowledged that he signed this
instrument, on oath stated that he was authorized to execute the instrument and
acknowledged it as the President of Westsound Bank to be the free and voluntary
act of such party for the uses and purposes mentioned in the instrument.

Dated:
       -----------                     ----------------------------------------
                                       Notary Public
                                       Print Name: ____________________________
                                       NOTARY PUBLIC in and for the
                                       State of Washington, residing at
                                       ________________________________________.
                                       My commission expires: _________________.

WESTSOUND PLAZA LEASE-27

<PAGE>

                                   EXHIBIT "A"

                                 SILVERDALE WAY

                                WESTSOUND PLAZA
                                   Site plan

                                   (SITE PLAN)

Safeway                                                                    Ernst

<PAGE>

                                   EXHIBIT "B"

That portion of the South one half of the North one half of the Southwest one
quarter of the Southwest one quarter of Section 16, Township 25 North, Range 1
East, W.M., in Kitsap County, Washington, lying Southeasterly of Kitsap Way and
Westerly of the West line of the East 572.00 feet of said subdivision as
measured along the South line of said Southwest one quarter of the Southwest one
quarter described as follows:

Commencing at the Southwest corner of said Southwest one quarter of Section 16;
thence North 00 degrees 43'30" East along the West line of said Southwest one
quarter, a distance of 990.02 feet to the North line of said South one half of
the North one half of the Southwest one quarter of the Southwest one quarter;
thence South 88 degrees 28'07" East along said North line, a distance of 505.79
feet to the Southeasterly right-of-way line of said Kitsap Way and the True
Point of Beginning, said point being 50.00 feet when measured at right angles
from the centerline of said Kitsap Way, thence continue South 88 degrees 28'07"
East along said North line a distance of 232.35 feet to said West line of the
East 572.00 feet of said subdivision as measured along the South line of said
Southwest one quarter of the Southwest one quarter; thence South 00 degrees
55'52" West along said West line a distance of 206.30 feet; thence North 88
degrees 28'07" West a distance of 383.78 feet to said Southeasterly right-of-way
line of Kitsap Way, thence North 37 degrees 25'10" East along said Southeasterly
right-of-way line, a distance of 254.63 feet to the True Point of Beginning.

<PAGE>

                                   EXHIBIT "C"

     A license is granted to tenants, employees and customers to remain on
     Westsound Plaza property during business hours provided they refrain from
     the following conduct or activities which are prohibited:

1.   Engaging in any criminal activity as defined by Silverdale, Kitsap County
     and Washington State criminal codes.

2.   Relocating or misusing Westsound Plaza furniture; including placing feet on
     chairs or benches or leaning back on two legs of chairs.

3.   Putting out cigarettes on the floor or furniture and otherwise littering on
     the property.

4.   Gathering in groups that block traffic ways, stairs, escalators or
     storefronts.

5.   Skateboarding or roller-skating on the property.

6.   Horse play - running, jumping, pushing, jostling patrons and/or customers.

7.   Creating loud noise or amplified yelling or screaming.

8.   Wearing apparel with spikes, studs or martial arts equipment or other
     paraphernalia which may be dangerous or harmful to persons or property on
     the property.

9.   Spitting or throwing anything while on the property.

10.  Distributing handbills or soliciting in unauthorized locations, or
     panhandling.

11.  Using obscene or offensive language or gestures (spoken or displayed).

12.  Damaging plants or landscaping.

13.  Entering a restroom which is designated solely for the opposite sex.

14.  Posting handbills, posters, or other literature outside the tenant's
     premises.

15.  Failure to be fully clothed (i.e. no shoes or shirt).

16.  Using sexually explicit language or conduct.

17.  Sitting on handrails, stairs, or trash receptacles.

18.  Engaging in any other activity which in the reasonably exercised judgment
     of Landlord, and its security officers, constitutes any annoyance of
     nuisance to other persons entitled to use the property for its intended
     purpose.

19.  Tenant shall, and Tenant will require all employees to park in areas which
     are from time to time designated by the Landlord and refrain from parking
     in areas designated for customers, loading or otherwise restricted.

<PAGE>

                                   EXHIBIT "D"

Landlord agrees to deliver to Tenant, and Tenant agrees to accept from Landlord,
possession of Suite 3, Westsound Plaza "AS IS". All repairs, renovation or
improvements shall be performed by Tenant at Tenant's sole expense in accordance
with the terms and conditions of this Lease.

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00109-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00109-of-00352.parquet"}]]