Document:

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                                                                    EXHIBIT 10.3

                              ADVISORY AGREEMENT
                                    BETWEEN
                        AMERICAN REALTY INVESTORS, INC.
                                      AND
                        BASIC CAPITAL MANAGEMENT, INC.

This ADVISORY AGREEMENT is made and entered into as of this 3rd day of August,
2000, between AMERICAN REALTY INVESTORS, INC., a Nevada corporation (the
"Company") and BASIC CAPITAL MANAGEMENT, INC. (the "Advisor"), a Nevada
corporation.

                              W I T N E S S E T H :

WHEREAS, the Company desires to avail itself of the experience, sources of
information, advice and assistance of the Advisor and to have the Advisor
undertake the duties and responsibilities hereinafter set forth, on behalf of
subject to the supervision of the Board of Directors (the "Directors") of the
Company, all as provided herein; and

WHEREAS, the Advisor is willing to undertake to render such services, subject to
the supervision of the Directors, on the terms and conditions hereinafter set
forth;

NOW, THEREFORE, in consideration of the premises and of the mutual covenants
herein contained, and other good and valuable consideration, the receipt and
adequacy of which is hereby acknowledged, the parties hereto agree as follows:

                  1. Definitions. As used herein, the following terms shall have
                     -----------
the meanings set forth below:

                   (a) "Adjusted Net Income" for any period shall mean "the Net
          Income of the Company increased by (i) depreciation on real estate and
          (ii) dividends with respect to equity investments of the Company
          accounted for on the equity method, determined on an accrual basis and
          reduced by the Company's share of the income or loss for investments
          accounted for on the equity method, determined on an accrual basis and
          reduced by the Company's share of the income or loss for investments,
          accounted for on the equity method."

                   (b) "Affiliate" shall mean (i) any Person directly or
          indirectly owning, controlling or holding with power to vote, five
          percent (5%) or more of the outstanding voting securities of such
          other Person; (ii) any person five percent (5%) or more of whose
          outstanding voting securities are directly or indirectly owned,
          controlled, or held with power to vote, by such other Person; (iii)
          any Person directly or indirectly controlling, controlled by, or under
          common control with, such

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          other Person; or (iv) any officer, director, partner, copartner, or
          employee of such other Person.

                   (c) "Average Invested Assets" for any period shall mean the
          average of the aggregate book value of the assets of the Company
          invested, directly or indirectly, in equity interests in and loans
          secured by real estate, before reserves for depreciation or bad debts
          or other similar non-cash reserves. This figure will be computed by
          taking the average of such values at the end of each month during such
          period.

                   (d) "Book Value" of an asset shall mean the value of such
          asset on the books of the Company, before allowance for depreciation
          or amortization.

                   (e) "Competitive Real Estate Commission" means that real
          estate or brokerage commission paid for the purchase or sale of a
          property which is reasonable, customary and competitive in light of
          the size, type and location of such property.

                   (f) "Fiscal Year" shall mean any period for which an income
          tax return is submitted by the Company to the Internal Revenue Service
          and which is treated by the Internal Revenue Service as a reporting
          period for the Company.

                   (g) "Mortgage" shall mean a mortgage, a deed of trust or any
          other instrument creating a security interest in a Real Property.

                   (h) "Mortgage Loan" shall mean a loan evidenced by a
          Mortgage.

                   (i) "Net Income" for any period shall mean total revenues
          applicable to such period, less the expenses applicable to such period
          other than additions to reserves for depreciation or bad debts or
          other similar non-cash reserves.

                   (j) "Person" shall mean and include individuals,
          corporations, limited partnerships, general partnerships, joint stock
          companies or associations, joint ventures, associations, companies,
          trusts, banks, trust companies, land trusts, business trusts, or other
          entities and governments and agencies and political subdivisions
          thereof.

                   (k) "Real Property" shall mean improved and unimproved land,
          improvements, furniture and fixtures located on or used in connection
          with land, and any right or interest in any of the foregoing,
          including a leasehold interest, an interest in air, subterranean or
          mineral rights, but shall not include Mortgage Loans.

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                   (l) "Company Property" shall mean, as of any particular time,
          any and all property, real, personal or otherwise, tangible or
          intangible, which is owned or held by the Company, including, but not
          limited to, property which is transferred, conveyed or paid to the
          Company, and all rents, income, profits and gains therefrom.

                   2. Duties of the Advisor. The Advisor agrees to act on a
                      ---------------------
basis which is fair and reasonable to the Company and its shareholders in
selecting from among the particular investment opportunities that come to it;
provided, however, that the Advisor shall not be required to present to the
--------  -------
Company any particular investment opportunity which comes to it even if the
opportunity is one which, if presented to the Company, could be taken by the
Company. Subject to the supervision of the Directors, the Advisor shall:

                   (a) use its best efforts to present and recommend to the
          Company a continuing and suitable investment program consistent with
          the investment policies and objectives of the Company;

                   (b) administer the Company's day-to-day investment operations
          and perform or supervise the performance of such other administrative
          functions in connection with the management of the Company as may be
          agreed upon by the Advisor and the Directors;

                   (c) serve as the Company's investment adviser and consultant
          in connection with policy decisions to be made by the Directors and,
          as requested, furnish reports to the Directors and provide research
          and economic and statistical data in connection with the Company's
          investments and investment policies;

                   (d) investigate, select and conduct relations on behalf of
          the Company with consultants, borrowers, lenders, mortgagors and other
          mortgage and investment participants, accountants, mortgage loan
          originators, or brokers, correspondents and servicers, technical
          advisers, attorneys, underwriters, brokers and dealers, corporate
          fiduciaries, escrow agents, depositaries, custodians, agents for
          collection, insurers, insurance agents, banks, builders and
          developers, and persons acting in any other capacity deemed by the
          Directors necessary or desirable, and enter into appropriate contracts
          with, employ, retain and supervise services performed or to be
          performed by, any such parties in connection with investments which
          have been or may be acquired, sold or otherwise disposed of by the
          Company;

                   (e) consult with the Directors and present to them
          opportunities to acquire Mortgage Loans and other investments

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          consistent with the investment policies and objectives of the Company
          and furnish the Directors with advice and recommendations with respect
          to the making, the acquiring (by purchase, investment, exchange or
          otherwise), the holding and the disposition (through sale, exchange or
          otherwise) of investments consistent with the policies and objectives
          of the Company, commitments therefor, loans secured by the pledge of
          mortgage loans as collateral, participations in any one of the
          foregoing, or Government or other securities or other investments of,
          or investments considered by, the Company;

                   (f) obtain for the Company such services as may be required
          for property management, mortgage servicing, construction and
          development loan disbursements and other activities relating to the
          investment portfolio of the Company, and act as the attorney-in-fact
          or agent of the Company in working with and supervising whomever is
          selected to perform such services; provided, however, that nothing
                                             --------  -------
          herein shall be construed to require the Advisor to perform such
          services itself;

                   (g) act as attorney-in-fact or agent of the Company in
          acquiring and disposing of investments, disbursing and collecting the
          funds of the Company, paying the debts and fulfilling the obligations
          of the Company, and handling, prosecuting and settling of any claims
          of the Company, including foreclosing and otherwise enforcing mortgage
          and other liens securing investments, and exercise its own sound
          discretion in doing so;

                   (h) assist in negotiations on behalf of the Company with
          investment banking firms, securities brokers or dealers and other
          institutions or investors for public or private sales of shares or
          other securities of the Company or public offerings or private
          placements by the Company of its securities, and obtain loans for the
          Company, but in no event in such a way that the Advisor would be
          deemed to be acting as a broker-dealer or underwriter;

                   (i) invest or reinvest any money of the Company;

                   (j) provide office space and office equipment, the use of
          accounting and computing equipment when required, and necessary
          executive, clerical and secretarial personnel for the performance of
          the foregoing services as Advisor;

                   (k) make reports to the Directors of its performance of the
          foregoing services and furnish advice and recommendations with respect
          to other aspects of the business and affairs of the Company from time
          to time or at any time requested by the Directors;

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                   (l) in general, inform the Directors of any factors which
          come to its attention which would influence the policies of the
          Company; and

                   (m) assist in the preparation of reports and other documents
          necessary to satisfy the continuous reporting and other requirements
          of any governmental bodies or agencies and to maintain effective
          communications with stockholders of the Company.

                   3. Records. At all times, the Advisor shall keep proper books
                      -------
of account and records relating to services performed hereunder, which books of
account and records shall be accessible for inspection by the Company at any
time during ordinary business hours.

                   4. Other Activities of Advisor.
                      ---------------------------

                   (a) Nothing herein contained shall prevent the Advisor, or
          any Affiliate of the Advisor, from acting as adviser to any other
          person or entity even though such entity may have investment policies
          similar to the Company; provided, however, that if, at any time, the
                                  --------  -------
          Advisor serves as adviser to more than one real estate entity
          (including the Company) with similar investment policies, it will
          offer loans and investments which are appropriate to more than one
          such entity first to that entity which has had uninvested funds for
          the longest period of time.

                   (b) Affiliates of the Advisor may serve as Directors,
          officers, employees, agents, nominees or signatories for the Company.
          When executing documents or otherwise acting in such capacities for
          the Company, such persons shall use their respective titles in the
          Company.

                   5. Additional Obligations of the Advisor.
                      -------------------------------------

                   Notwithstanding any other provision of this Agreement to the
contrary, the Advisor shall refrain from any action which, in its reasonable
judgment or any judgment of the Board of Directors of which the Advisor has
written notice would (a) violate any law, rule or regulation of any governmental
body or agency having jurisdiction over the Company or its securities or (b)
cause the Company to be required to register as an investment company under the
Investment Company Act of 1940. If any such action is ordered by the Board of
Directors, the Advisor shall promptly notify the Board of the Advisor's judgment
that such action would adversely affect such status or violate such law, rule or
regulation or require such registration and shall refrain from taking such
action pending further clarification or instruction from the Board of Directors.

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                   6. Bond. The Advisor shall maintain a fidelity bond with a
                      ----
responsible surety company in such amount as may be required by the Directors
from time to time, covering all officers, employees and agents of the Advisor
handling funds of the Company and any investment documents or records pertaining
to investments of the Company. Such bond shall inure to the benefit of the
Company in respect of losses of any such property from acts of such persons
through theft, embezzlement, fraud, negligence, error or omission or otherwise
(provided that such bond can be obtained for such acts at reasonable expense),
the premium for said bond to be at the expense of the Company.

                   7. Expenses of the Advisor. Without regard to the amount of
                      -----------------------
compensation received hereunder by the Advisor, the Advisor shall bear the
following expenses of the Company:

                   (a) all direct and indirect remuneration and all other
          employment expenses of employees of the Advisor, including but not
          limited to, salaries, wages, payroll taxes and the costs of employee
          benefit plans, but not including fees paid to Directors affiliated
          with the Advisor;

                   (b) rent, telephone, utilities, office furniture, equipment
          and machinery and other office expenses of the Advisor and the
          Company, except as any of such expenses relate to an office maintained
          by the Company separate from the office of the Advisor;

                   (c) costs including but not limited to travel, marketing,
          seminars, courier, business promotions, entertainment, advertising,
          office supplies, etc. where such costs are not directly identifiable
          to the Company's assets, liabilities, operations, business and
          financial affairs; and

                   (d) miscellaneous administrative expenses relating to
          performance by the Advisor of its duties hereunder.

                   8. Compensation. The Advisor shall be paid for services
                      ------------
rendered by it under this Agreement as follows:

                   (a) Base Compensation. On or before the fifteenth (15th) day
                       -----------------
          of each calendar month, the Company shall pay to the Advisor .0625%
          (.75% on an annualized basis) of Average Invested Assets of the
          Company during the preceding month.

                   (b) Incentive Compensation. In order to further reward the
                       ----------------------
          Advisor for performance hereunder, the Company shall pay to the
          Advisor on or before the ninetieth (90th) day after the close of each
          Fiscal Year an incentive fee equal to ten percent (10%) of Net Income
          for such Fiscal Year in excess of a ten percent (10%) return on
          shareholders' equity. The Advisor shall also receive ten percent (10%)
          of the excess, if

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          any, of net capital gain over net capital loss, if any, realized for
          sales of assets.

                   (c) Mortgage Placement Fee. For originating or purchasing
                       ----------------------
          Mortgage Loans for the Company, the Advisor shall receive a mortgage
          placement fee equal to fifty percent (50%), measured on a cumulative
          basis, of the total amount of mortgage origination and placement fees
          for Mortgage Loans advanced by the Company for the Fiscal Year.

                   (d) Acquisition Commission. For locating, leasing or
                       ----------------------
          purchasing Real Property for the Company, the Advisor or an Affiliate
          shall receive an Acquisition Commission equal to the lesser of (i) up
          to 6% of costs of acquisition, inclusive of commissions, if any, paid
          to nonaffiliated brokers; or (ii) the compensation customarily charged
          in arm's-length transactions by others rendering similar property
          acquisition services as an ongoing public activity in the same
          geographical location and for comparable property.

                   (e) Disposition Fees. For the sale of each equity investment
                       ----------------
          in Real Property, the Advisor or an Affiliate shall receive a
          Disposition Fee equal to the lesser of (i) 3% of the sales price of
          each property, exclusive of fees, if any, paid to nonaffiliated
          brokers; or (ii) the compensation customarily charged in arm's length
          transactions by others rendering similar services as an ongoing public
          activity in the same geographical location for comparable property.

                   (f) Loan Arrangement Fee. For arranging any loans to the
                       --------------------
          Company, the Advisor shall receive a fee equal to 1% of the principal
          amount of any such loan. For purposes of this Section 8(f) the
          principal amount of any line of credit shall be the maximum
          availability under such line.

                  9. Additional Services. If and to the extent that the Company
                     -------------------
shall request the Advisor, or any director, officer, partner or employee of the
Advisor, to render services for the Company other than those required to be
rendered by the Advisor hereunder, such additional services, if performed, will
be compensated separately on terms agreed upon between such party and the
Company from time to time, subject to applicable law. In particular, but without
limitation, if the Company shall request that the Advisor perform property
management, mortgage servicing, loan disbursement or similar functions, the
Company and the Advisor shall enter into a separate agreement specifying the
obligations of the parties and providing for reasonable additional compensation
to the Advisor for performing such services.

                   10. Statements. The Advisor shall prepare, at the request of
                       ----------
the Directors, a statement showing the computation of the fee, if any, payable
with respect to any period so requested.

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         11. Information Furnished to Advisor. The Directors shall at
             --------------------------------
all times keep the Advisor fully informed with regard to the investment policy
of the Company, the capitalization policy of the Company, and generally their
then current intentions as to the future of the Company. In particular, the
Directors shall notify the Advisor promptly of their intention to sell or
otherwise dispose of any of the Company's investments, or to make any new
investment. The Company shall furnish the Advisor with a copy of all financial
statements, a signed copy of each report prepared by independent certified
public accountants, and such other information with regard to its affairs which
the Advisor from time to time may reasonably request.

         12. Expenses of the Company. Except as expressly otherwise provided in
             -----------------------
this Agreement, the Company shall pay all expenses not assumed by the Advisor;
including, but not limited to:

          (a) To the extent the Advisor is not required to pay such expenses
    pursuant to Section 7 hereof, the salaries and other employment expenses of
    the Directors of and personnel employed by the Company and travel and
    related expenses of directors, officers and employees of the Advisor and of
    Directors, officers and employees of the Company relating to the business
    and financial affairs of the Company;

          (b) the cost of borrowed money;

          (c) taxes on income, taxes on property, assessments against property,
    and all other taxes and applicable to the Company;

          (d) legal, audit, accounting, underwriting, brokerage, listing,
    registration and other fees, printing, engraving and other expenses and
    taxes incurred in connection with the issuance, distribution, transfer,
    registration and stock exchange listing of the Company's securities;

          (e) fees and expenses paid to independent advisers, independent
    contractors, consultants (including investor relations consultants),
    managers and other agents employed directly by the Company (other than
    through the Advisor);

          (f) to the extent not paid by borrowers from the Company, costs of
    loan administration and mortgage servicing;

          (g) expenses related to mortgage loans and connected with the
    acquisition, disposition, leasing and ownership of investments, including,
    to the extent not paid by others, but not limited to, legal fees and other
    expenses of professional services; the costs of foreclosure; costs of
    financings and refinancings; insurance premiums; legal or accounting
    services; taxes; title and abstract expenses; brokerage and

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    sales commissions; maintenance, repair or improvement of property;
    architectural and engineering fees; expenses of managing real property
    equity interests and appraisal or inspection fees except when performed by
    employees of the Advisor;

          (h) expenses related to real estate equity interests owned by the
    Company, including, but not limited to, insurance premiums; legal or
    accounting services; architectural and engineering fees; appraisal or
    inspection fees except when performed by employees of the Advisor; taxes;
    title and abstract expenses; brokerage and sales commissions; management
    fees and expenses; and costs of financings and refinancings;

          (i) other insurance as required by the Directors (including Directors'
    liability insurance, if any);

          (j) the expenses of dissolving the Company or of amending the Articles
    of Incorporation or Bylaws of the Company or of merging the Company with any
    other entity;

          (k) expenses connected directly with payments to holders of securities
    of the Company and other bookkeeping and clerical work necessary in
    maintaining relations with holders of securities and the investment
    community in general, including the cost of preparing, printing and
    distributing proxy materials, reports to shareholders, news releases, and
    certificates for securities, and any legal assistance related thereto;

          (l) transfer agents', registrars', warrant agents', dividend paying
    agents' and indenture trustees' fees and charges;

          (m) advertising expenses incurred in seeking investments for the
    Company; and

          (n) all costs including but not limited to travel, marketing,
    seminars, courier, business promotions, entertainment, advertising, office
    supplies, etc. where such costs are directly attributable and identifiable
    to the Company's assets, liabilities, operations, business and financial
    affairs.

          13. No Partnership or Joint Venture. The Company and the Advisor are
              -------------------------------
not partners or joint venturers with each other and nothing herein shall be
construed so as to make them such partners or joint venturers or impose any
liability as such on either of them.

          14. Term of Agreement. This Agreement shall continue in force for a
              -----------------
period of twelve (12) months from August 3, 2000 and

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thereafter shall be automatically renewed from year to year unless terminated in
accordance with the provisions of this Agreement;

          15. Termination. Notwithstanding any other provision of this Agreement
              -----------
to the contrary, this Agreement may be terminated by the Advisor without penalty
for any reason upon sixty (60) days' written notice to the Company or may be
terminated by the Company without penalty for any reason by the Directors or by
the holders of a majority in interest of the then outstanding shares of the
Company upon sixty (60) days' written notice to the Advisor.

          16. Assignment. The Advisor shall not assign this Agreement without
              ----------
the written consent of the Company. The Company may terminate this Agreement in
the event of its assignment by the Advisor except in the event of an assignment
to a corporation, association, trust, or other successor organization which may
take over the property and carry on the affairs of the Advisor, provided that
following such assignment the entity which controlled the operations of the
Advisor immediately prior to the assignment shall control the operations of the
successor organization, including the performance of the Advisor's duties under
this Agreement, and it shall be bound by the same restrictions by which it was
bound prior to such assignment; however, if at any time subsequent to such an
assignment such entity shall cease to control the operations of the successor
organization, the Company may thereupon terminate this agreement. Such an
assignment or any other assignment of this Agreement by the Advisor shall bind
the assignee hereunder in the same manner as the Advisor is bound hereunder. In
addition, the Advisor may delegate, assign, or otherwise discharge any of its
obligations under this Agreement to or through any of its wholly-owned
subsidiaries or their wholly-owned subsidiaries, subject to the same terms and
conditions as are applicable to the Advisor itself under this Agreement.

          17. Default, Bankruptcy, etc. At the option solely of the Directors,
              ------------------------
this Agreement shall be and become terminated immediately upon written notice of
termination from the Directors to the Advisor if any of the following events
shall occur:

            (a) if the Advisor shall violate any provision of this Agreement,
       and after notice of such violation shall not cure such default within
       thirty (30) days;

            (b) if the Advisor shall be adjudged bankrupt or insolvent by a
       court of competent jurisdiction, or an order shall be made by a court of
       competent jurisdiction for the appointment of a receiver, liquidator or
       trustee of the Advisor or of all or substantially all of its property by
       reason of the foregoing, or approving any petition filed against the
       Advisor for its reorganization and such adjudication or order shall
       remain in full force or unstayed for a period of thirty (30) days; or

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            (c) if the Advisor shall institute proceedings for voluntary
       bankruptcy or shall file a petition seeking reorganization under the
       Federal bankruptcy laws, or for relief under any law for the relief of
       debtors, or shall consent to the appointment of a receiver of itself or
       all or substantially all its property, or shall make a general assignment
       for the benefit of its creditors, or shall admit in writing its inability
       to pay its debts generally as they become due.

          The Advisor agrees that if any of the events specified in
subsections (b) or (c) of this Section 17 shall occur, it will give written
notice thereof to the Directors within seven (7) days after the occurrence of
such event.

          18. Action Upon Termination. From and after the effective date of
              -----------------------
expiration or termination of this Agreement, pursuant to Sections 14, 15, 16 or
17 hereof, the Advisor shall not be entitled to compensation for further
services hereunder but shall be paid all compensation accruing to the date of
expiration or termination. The Advisor shall forthwith upon any such event:

            (a) pay over the Company all monies collected and held for the
       account of the Company pursuant to this Agreement;

            (b) as soon as possible, deliver to the Directors a full accounting,
       including a statement showing all payments collected by it and a
       statement of all monies held by it, covering the period following the
       date of the last accounting furnished to the Directors;

            (c) deliver to the Directors all property and documents of the
       Company then in the custody of the Advisor; and

            (d) cooperate with the Company and take all reasonable steps
       requested by the Directors to assist the Directors in making an orderly
       transition.

          19. Advisor's Liability. The Advisor assumes no responsibility under
              -------------------
this Agreement other than to render the services called for hereunder in good
faith and to make decisions and advise courses of action that it determines, in
good faith, to be in the best interests of the Company, and the Advisor shall
not be responsible for any action of the Directors in following or declining to
follow any advice or recommendations of the Advisor. Neither the Advisor nor its
shareholders, directors, officers or employees shall be liable to the Company,
the Directors, the holders of securities of the Company or to any successor or
assign of the Company except by reason of acts constituting bad faith, willful
misfeasance, gross negligence or reckless disregard of their duties.

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          20. Notices. Any notice, report or other communication required or
              -------
permitted to be given hereunder shall be in writing unless some other method of
giving such notice, report or other communication is accepted by the party to
whom it is given, and shall be given by being delivered or being mailed,
certified or registered mail, return receipt requested, to the following
addresses of the parties hereto:

         The Directors and                       American Realty Investors, Inc.
         The Company:                            10670 North Central Expressway
                                                 Suite 300
                                                 Dallas, Texas 75231
                                                 Attn: President

         The Advisor                             Basic Capital Management, Inc.
                                                 10670 North Central Expressway
                                                 Suite 600
                                                 Dallas, Texas 75231
                                                 Attn: President

          Either part may at any time give notice in writing to the other party
of a change of its address for the purpose of this Section 20.

          21. Amendments. This Agreement shall not be changed, modified,
              ----------
terminated or discharged in whole or in part except by an instrument in writing
signed by both parties hereto, or their respective successors or assigns, or
otherwise as provided herein.

          22. Headings. The section headings hereof have been inserted for
              --------
convenience of reference only and shall not be construed to affect the meaning,
construction or effect of this Agreement.

          23. Governing Law. This Agreement has been prepared, negotiated and
              -------------
executed in the State of Texas. The provisions of this Agreement shall be
construed and interpreted in accordance with the laws of the State of Texas
applicable to agreements made and to be performed therein.

          24. Binding Effect. This Agreement shall be binding upon, and inure to
              --------------
the benefit of, the parties hereto and their respective successors and assigns,
subject to the provisions of Section 16 of this Agreement.

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          IN WITNESS WHEREOF, the Company and the Advisor have caused this
Agreement to be executed by their respective duly authorized officers as of the
day and year first above written.

                                 AMERICAN REALTY INVESTORS, INC.

                                 By:  /s/ Karl L. Blaha
                                     ---------------------------
                                     Karl L. Blaha
                                     President

                                 BASIC CAPITAL MANAGEMENT, INC.

                                 By:  /s/ Bruce A. Endendyk
                                    ----------------------------
                                     Bruce A. Endendyk
                                     Executive Vice President

                                      125<PAGE>

                                                                   Exhibit 10.21

                                LEASE AGREEMENT

                                    Between

            SAN LUIS PARTNERSHIP, a California general partnership

                                   LANDLORD,

                                      and

         PETRO STOPPING CENTERS, L.P., a Delaware limited partnership

                                    TENANT

                             Location of Premises:

                             28991 W. Gonzaga Road
                           Merced County, California

                            "San Luis Travel Plaza"
<PAGE>

                                     INDEX
                                     -----
<TABLE>
<CAPTION>
Article                                                                                                                  Page
------------------------------------------------------------------------------------------------------------------------------
<S>                                                                                                                    <C>
          1       Basic Lease Provisions.................................................................................   1

          2       Demise and Term........................................................................................   1

          3       Real Property Improvements.............................................................................   1

          4       Equipment..............................................................................................   2

          5       Rent...................................................................................................   2

          6       Taxes and Assessments..................................................................................   2

          7       Landlord's Covenants and Restrictions..................................................................   3

          8       Warranties and Representations.........................................................................   3

          9       Subordination, Attornment and Non-Disturbance
                  Agreement; Estoppel Letters............................................................................   6

         10       Force Majeure..........................................................................................   7

         11       Alterations by Tenant -- Mechanics' Liens..............................................................   7

         12       Maintenance and Repair Obligations.....................................................................   7

         13       Utilities..............................................................................................   7

         14       Observance of Laws, Regulations, Etc...................................................................   7

         15       Assignment.............................................................................................   8

         16       Insurance and Subrogation..............................................................................   8

         17       Damage and Destruction.................................................................................   8

         18       Condemnation...........................................................................................   9

         19       Signs..................................................................................................   9

         20       Default................................................................................................   9

         21       Purchase Option........................................................................................  10

         22       Indemnification........................................................................................  11

         23       Conditions to Lease ...................................................................................  12

         24       Purchase of Inventory .................................................................................  12

         25       Miscellaneous Provisions...............................................................................  12
</TABLE>

EXHIBITS

         Exhibit A:        Legal description of the Premises.

         Exhibit B:        List of Equipment

         Exhibit B-1:      Equipment Warranties and Guarantees

         Exhibit C:        Memorandum of Lease and Purchase Option.

         Exhibit D:        List of registered underground storage and other
                           tanks.

         Exhibit E:        Permitted Encumbrances.

         Exhibit F:        Equipment Not in Operating Condition

         Exhibit G:        Permits

         Exhibit H:        Scheduled Contracts

         Exhibit I:        Scheduled Leases

         Exhibit J:        Liens to be Released

         Exhibit K:        Alterations

APPENDICES:
----------

         8.01(D)           Insurance Policies

                                       i

<PAGE>

         8.01(E)           Litigation

         8.01(K)           Environmental Matters

         8.01(M)           Ten Largest Customers of San Luis Travel Plaza

<PAGE>

                                LEASE AGREEMENT

  AGREEMENT OF LEASE made effective as of the ____ day of _____________, 2000,
(the "Effective Date"), by and between SAN LUIS PARTNERSHIP, a California
general partnership, whose address is 5570 Sanchez, #230, San Jose, California
95123 (hereinafter referred to as "Landlord") and PETRO STOPPING CENTERS, L.P.,
a Delaware limited partnership, with offices at 6080 Surety Drive, El Paso,
Texas 79905 (hereinafter referred to as "Tenant").

                             W I T N E S S E T H:

That Landlord, in consideration of the rents and covenants herein set forth,
hereby leases to Tenant, and Tenant hereby leases from Landlord, the Premises
hereinafter described, upon the following terms and conditions:

                                   ARTICLE 1

                            BASIC LEASE PROVISIONS

SECTION 1.01  BASIC LEASE PROVISIONS

  (A) Name and location of Premises: The San Luis Travel Plaza, located at 28991
W. Gonzaga Road, Merced County, California 95322, situated on the real property
described on Exhibit A attached hereto and made a part hereof, together with the
buildings and all other improvements thereon.

  (B) Premises: The "Premises" consist of the real property described on Exhibit
A, containing approximately 14.68 acres of land, more or less and all easements,
rights of ingress and egress, rights-of-way and appurtenances thereto and all
parking areas used or useful in connection therewith (the "Real Property"), and
all improvements and buildings situated thereon, including without limitation
two (2) Buildings, being the Truck Stop Building and the Lube Building
(collectively, the "Improvements"), and all Equipment (as hereafter defined)
situated on the Real Property and in, on, under and about the Improvements.

  (C) Initial Term:  Five (5) years.

  (D) Options to extend Term: Four (4) renewal options of five (5) years each
(each a "Renewal Term"), subject to the provisions of Section 2.02 hereof.

  (E) Rent: During the Initial Term of this Lease, Rent shall be Four Hundred
Sixty Two Thousand and No/Dollars ($462,000.00) per year, payable in equal
monthly installments of Thirty Eight Thousand Five Hundred and No/100 Dollars
($38,500.00). During each Renewal Term, Rent shall be Six Hundred Sixty Thousand
and No/Dollars ($630,000.00) per year, payable in equal monthly installments of
Fifty Two Thousand Five Hundred and No/100 Dollars ($52,500.00).

                                   ARTICLE 2

                                DEMISE AND TERM

SECTION 2.01: PREMISES

  (A) Real Property. Landlord leases to Tenant, and Tenant leases from Landlord,
      -------------
the Premises, including all of Landlord's right, title and interest in and to
the Real Property and the Improvements thereon as shown on Exhibit A, and
including the underground storage and other tanks, the related islands, pumps,
dispensers and other equipment (the "USTs") described on Exhibit D attached
hereto and made a part hereof.

  (B) Equipment. Landlord leases to Tenant, and Tenant leases from Landlord, all
      ---------
furniture, fixtures, trade fixtures, machinery, equipment and other personal
property owned by Landlord (the "Equipment"), as more particularly described in
Exhibit B attached hereto and made a part hereto, it being intended that the
Equipment include all personal property used or useful in connection with the
operation of the San Luis Travel Plaza.

  (C) Quiet Enjoyment. Upon Tenant paying Rent and performing all of the
      ---------------
covenants and conditions set forth herein, Landlord hereby covenants and agrees
that Tenant will peacefully and quietly have, hold and enjoy the Premises and
Equipment for the term herein provided.

  (D) Use of Premises. Tenant may use the Premises for the operation of a truck
      ---------------
travel plaza or for any other lawful purpose.

SECTION 2.02: INITIAL TERM DATE; RENEWAL OPTIONS. The Initial Term of this Lease
shall commence when each of the Conditions to Lease described in Article 23
hereof shall be satisfied or waived by Tenant or Tenant accepts possession of
the Premises and Equipment (the "Commencement Date"), which the parties
anticipate to be on or about October 25, 2000 and shall terminate five (5) years
thereafter. Following the Commencement Date, Landlord and Tenant shall execute a
memorandum confirming the date hereof.

  Landlord hereby grants to Tenant, in addition to the Initial Term, the option
to renew this Lease for four (4) additional terms of five (5) years each (each a
"Renewal Term"), subject to and on the same terms and conditions as herein
provided. Each Renewal Term shall be exercised at the election of Tenant by the
tender of written notice of Tenant's intention to extend the this Lease not less
than ninety (90) days prior to the expiration of the Initial Term or the then
current Renewal Term, as applicable.

SECTION 2.03: MEMORANDUM OF LEASE. Each of the parties hereto agrees to promptly
execute and record the Memorandum of Lease and Purchase Option attached hereto
as Exhibit C.

SECTION 2.04: EFFECTIVE DATE. Notwithstanding anything to the contrary contained
herein, including without limitation that the Commencement Date shall be
subsequent to the Effective Date of this Lease, it is the intention

                                       2
<PAGE>

of Landlord and Tenant that this Lease be effective between the parties as of
the Effective Date and that as of such date, that each of Landlord and Tenant
have their respective rights and obligations hereunder.

                                   ARTICLE 3

                          REAL PROPERTY IMPROVEMENTS

  Landlord hereby represents and warrants to Tenant that as of the Commencement
Date, the Improvements (including the HVAC, plumbing, electrical, mechanical and
other component systems) are in operating condition, order and repair, subject
to ordinary wear and tear and capable of being used in the business as presently
being conducted without present need for repair or replacement except in the
ordinary course of business; that the Improvements have been maintained and
repaired in accordance with reasonable business practices, consistently applied
and in accordance with the terms of all warranties and guarantees; the zoning
classification of the Real Property is such that the Real Property may be used
as it was used by Landlord immediately prior to the Commencement Date; the
Premises do not, at the Commencement Date, violate in any material respect, any
provisions of any applicable building code, fire, health or safety regulation,
or other governmental ordinances, orders or regulations, and no condition exists
as of the Commencement Date with respect to the Premises which would prevent, or
require repair or modification thereof as a prerequisite to, Tenant using the
Premises in the ordinary conduct of a full facility truck/auto travel center
business, excluding conditions which require repair and maintenance in the
ordinary course.

                                   ARTICLE 4

                                   EQUIPMENT

SECTION 4.01:  USE AND MAINTENANCE.

  (A) Landlord hereby represents and warrants to Tenant that as of the
Commencement Date, the Equipment is (i) in operating condition, order and
repair, subject to ordinary wear and tear, and have been maintained in
accordance with reasonable business practices, consistently applied and in
accordance with the terms of all warranties and guarantees, (ii) capable of
being used in the business as presently being conducted without present need for
repair or replacement except in the ordinary course of the business, (iii)
conforms, to the best knowledge of Landlord, in all material respects with all
applicable legal requirements, and (iv) in the aggregate provides the capacity
to enable Landlord to engage in commercial operation in the business on a
continuous basis (subject to normal maintenance and repair outages in the
ordinary course). Landlord further warrants and represents that all
manufacturer's, vendor's, or dealer's warranties and guarantees applicable to
the Equipment are described on Exhibit B-1 attached hereto and made a part
hereof (the "Warranties") and that all such Warranties are in full force and
effect as of the Effective Date of this Lease.

  (B) During the term of this Lease, Tenant shall use the Equipment in the
conduct of Tenant's business and in compliance with all Applicable Laws.

  (C) Subject to the provisions of subparagraph (D) below Tenant, at its
expense, will repair and maintain the Equipment in the condition received from
Landlord, ordinary wear and tear and damage by casualty and condemnation
excepted.

  (D) In the event that during the term of this Lease the Equipment, or any
portion thereof, shall become obsolete, inoperable, unusable, unfit for use or
out of repair, or should Tenant otherwise desire to replace any portion of the
Equipment, Tenant may relinquish such portion of the Equipment to Landlord,
making the same available to Landlord at the Real Property. In such event Tenant
shall give Landlord written notice of its intention to replace such portion of
the Equipment and thereafter Landlord shall have a period of fifteen (15) days
within which to remove the same from the Real Property, at its sole cost and
expense. In the event Landlord fails to reclaim and remove the Equipment within
such fifteen (15) day period, Landlord shall be deemed to have abandoned the
same and thereafter Tenant shall be free to dispose of such Equipment as Tenant
chooses without any obligation or liability to account to Landlord therefore,
except as provided in subsection (E) below. In the event Tenant elects to
replace any Equipment or in any event install other items of personal property
on or about the Real Property for use in connection with Tenant's business
thereon (the "Tenant's Equipment"), Landlord, within five (5) days of the
request therefor from Tenant, will execute such affidavits, confirmations,
agreements, financing statements or other documents to disclaim any ownership or
security interest in Tenant's Equipment. Should Landlord fail or refuse to
execute any such confirmation, affidavit, agreement, financing statement or
document with respect to the Tenant's Equipment, following the request by
Tenant, Tenant is hereby appointed attorney in fact, and granted the power of
attorney for Landlord, for the purpose of executing the same.

  (E) Upon the expiration of the Initial Term and all applicable Renewal Terms
of this Lease, and provided the Option (as defined in Section 20 hereof) has not
been executed, Tenant shall relinquish to Landlord at the Premises the right to
possession and use of the remaining Equipment originally leased hereunder from
to Landlord to Tenant, plus any replacement equipment installed by Tenant, such
remaining Equipment to then be in substantially the same condition as of the
Effective Date, ordinary wear, tear and obsolescence and damage by casualty and
condemnation excepted, and Tenant shall leave the Premises as a completely
operational facility; provided that Tenant shall have the right to remove any
Equipment bearing its marks so long as such items are replaced by Tenant so that
the Premises remain operational.

                                   ARTICLE 5

                                     RENT

  During the Initial Term and any Renewal Term of this Lease, Tenant shall pay
to Landlord at the address herein provided, the Rent as set out in Section 1.01
(E) above, in equal monthly installments in advance, commencing on the
Commencement Date. Rent for any partial month during any Lease Term shall be
prorated.

                                       3
<PAGE>

                                   ARTICLE 6

                             TAXES AND ASSESSMENTS

  (A) During the term of this Lease, Tenant agrees to pay, before they become
delinquent, all real estate taxes, special assessments, and other governmental
charges ("Real Estate Taxes") which may be lawfully levied upon or against the
Premises described herein and all use, personal property and ad valorem taxes
and assessments imposed by reason of use or operation of the Equipment (the
"Personal Property Taxes" and together with the Real Estate Taxes, the "Taxes"),
provided that Tenant's obligation for Taxes shall be equitably adjusted for any
portion of the term of this Lease which does not include an entire tax year.

  Nothing herein contained shall require or be construed to require Tenant to
pay any inheritance, estate, succession, mortgage or transfer tax, gift,
franchise, withholding, income or profit tax, that is or may be imposed upon
Landlord, its successors or assigns, in connection with the operation of the
Premises, Equipment or otherwise.

  (B) Immediately upon receipt of any tax bill, statement or assessment with
respect to the Taxes owing in connection with the Premises, Landlord shall
furnish to Tenant such tax bill, statement or assessment. Tenant shall furnish
evidence of the payment of the Taxes to Landlord upon the request therefore from
Landlord.

  (C) Tenant hereby reserves the right to contest the amount of any Taxes in its
name or in the name of Landlord, and Landlord hereby covenants and agrees to
cooperate with Tenant in all respects with regards thereto. Tenant shall provide
a surety bond or other security reasonably satisfactory to Landlord to protect
the Landlord and the Premises from the enforcement of any lien against the
Premises for any such Taxes during the period of contest.

  (D) In addition, Tenant agrees to reimburse Landlord for amounts paid to San
Luis Water District for charges incurred with respect to the Premises during the
term of this Lease. Landlord, at the time it demands payment therefore, will
provide copies of any such bills or assessments to Tenant.

                                   ARTICLE 7

                     LANDLORD'S COVENANTS AND RESTRICTIONS

SECTION 7.01: LANDLORD'S COVENANTS AND RESTRICTIONS. Landlord hereby covenants
and agrees that, during the term hereof, Landlord shall not lease, or permit to
be leased, used or occupied any space within the Premises, and that the lease of
the Premises to Tenant is exclusive of the right of possession of all other
parties.

SECTION 7.02: OPERATION OF PREMISES. Landlord covenants and agrees that the
sizes, location and arrangements of the Improvements and parking areas
(including traffic circulation and flow patterns) existing as of the Effective
Date will not be changed without Tenant's written consent.

                                   ARTICLE 8

                        WARRANTIES AND REPRESENTATIONS

SECTION 8.01:  REPRESENTATIONS AND WARRANTIES OF LANDLORD.

  Landlord represents and warrants to Tenant that the following are true and
correct on and as of the date of this Agreement and will be true and correct
through the Commencement Date as if made on and as of those respective dates.

  (A) Organization of Landlord. Landlord is a general partnership duly
      ------------------------
organized, validly existing and in good standing under the laws of the State of
California in order to conduct its businesses as presently conducted. Landlord
has heretofore delivered to Tenant a complete and correct copy of its
Partnership Agreement, as amended and in effect on the date hereof.

  (B) Consents, Authorizations and Binding Effect.
      -------------------------------------------

      (1) Landlord and each of its partners has authorized the transaction
  contemplated herein and Landlord may execute, deliver and perform this Lease
  without the necessity of Landlord obtaining any consent, approval,
  authorization or waiver or giving any notice or otherwise.

      (2) This Lease constitutes the legal, valid and binding obligation of
  Landlord, enforceable against it in accordance with its terms.

      (3) The execution, delivery and performance of this Agreement by
  Landlord does not and will not: (i) constitute a violation of its Partnership
  Agreement, as amended; (ii) result in any lien against the Premises; (iii)
  constitute a violation of any statute, judgment, order, decree or regulation
  or rule of any governmental body applicable or relating to Landlord or the
  Premises or the business of Landlord; or (iv) conflict with, or constitute a
  breach or default under, or give rise to any right of termination,
  cancellation or acceleration under, any term or provision of any contract,
  agreement, loan agreement or other agreement with any lender, lease, mortgage,
  deed of trust, commitment, license, franchise, permit, authorization or any
  other instrument or obligation to which Landlord is a party or by which their
  respective assets are bound, or an event which with notice, lapse of time, or
  both, would result in any such conflict, breach, default or right.

  (C) Title and Condition.
      -------------------

      (1) Landlord has and hereby leases to Tenant good and indefeasible
  title to the Premises free and clear of any and all liens (including without
  limitation all leases, licenses, restrictions, restrictive covenants and
  rights-of-way) other than permitted encumbrances described on Exhibit E
  attached hereto and made a part hereof (the "Permitted Encumbrances").

                                       4
<PAGE>

           (2) Except as described in Exhibits H and I attached hereto, there
  are no parties in possession of any portion of the Premises as lessees,
  licensees, tenants at sufferance or trespassers, other than Landlord. Landlord
  has duly given all required notice to month-to-month tenants of the
  termination of any month-to- month tenancy described in such Exhibits H and I
  and shall immediately give to Tenant true and complete copies of all such
  notices. Landlord represents and covenants that such tenancy and all rights of
  the tenants to possession of the property will have been terminated on or
  prior to the Commencement Date.

           (3) There is no pending or threatened condemnation or similar
  proceeding or assessment affecting the Premises, or any part thereof, nor to
  the best knowledge and belief of Landlord is any such proceeding or assessment
  contemplated by any governmental body.

           (4) Landlord has complied in all material respects with all
  applicable laws, ordinances, regulations, statutes, rules and restrictions
  relating to the Premises, or any part thereof, and as of the date hereof
  represents that the Premises comply with all applicable building codes and
  operation and use restrictions.

           (5) There are gas and electricity lines to the Premises which are
  available for "tap in" by Tenant and which are sufficient for service on the
  Premises with respect to the business contemplated to be conducted by Tenant
  in the existing facilities on the Premises (as may be upgraded by Tenant). As
  to water for use on the Premises, Landlord receives an annual allocation from
  San Luis Water Improvement District in March of each year. The water
  allocation for the Premises through March, 2001 is 2.1 acre feet of water per
  acre of land. Landlord hereby transfers and assigns to Tenant 100% of the
  prorata share of the San Luis Water District's annual water allocation for the
  Premises, based upon 14.68 acres of land within the Premises.

           In addition, Landlord hereby covenants and agrees to assist Tenant in
  processing a water transfer form for filing with San Luis Water Improvement
  District to reflect Petro as the user of record for the water for the
  Premises. Landlord covenants and agrees to timely provide to Tenant copies of
  any and all notices received from San Luis Water Improvement District or with
  regards to allocation of any water pursuant thereto.

           The water and sewer lines to the Premises are available for "tap-on"
  by Tenant and sufficient for service on the Premises with respect to the
  business contemplated by Tenant and the development of all other properties to
  be serviced thereby. Landlord and Tenant hereby acknowledge and agree that in
  the event the development by Landlord, or its successors or assigns, of
  property adjacent to the Premises creates additional demand on the sewer
  system beyond its capacity, that Landlord, its successors and assigns, shall
  bear the sole cost and expense of any upgrade, modification or expansion of
  the sewer facility.

           (6) The Premises has full and free access to and from public
  highways, streets or roads and, to the best knowledge and belief of Landlord,
  there is no pending or threatened proceeding by any governmental body which
  would impair or result in the termination of such access.

           (7) No Improvement on the Premises encroaches on any adjacent
  property. No Improvement on any part of the Premises has been damaged by any
  casualty or act of God or been subject to any condemnation proceedings.

           (8) Landlord shall deliver the Premises to Tenant at the Commencement
  Date in good order, condition and repair.

       (D) Insurance. Appendix 8.01(D) attached hereto contains a list of all
           ---------
policies of insurance maintained as of the date of this Lease by Landlord, or
maintained by partners of Landlord in respect of the business and Premises and
Equipment in effect as of the date of this Lease. The insurance policies set
forth on Appendix 8.01(D) attached hereto provides commercially reasonable
coverage against the risks involved in the business and operation of such
property and assets.

       Landlord has not received notice from any insurance carrier of the
intention of such carrier to discontinue any insurance coverage afforded to
Landlord or requiring the expenditure of any funds to continue coverage.

       (E) Litigation and Compliance With Laws, Etc. There are no claims,
           ----------------------------------------
actions, suits or proceedings, whether in equity or at law, or governmental or
administrative investigations pending or, to the best knowledge of Landlord,
threatened against Landlord or any of the Premises or Equipment, except as
described on Appendix 8.01(E) attached hereto.

       (F) Taxes. Landlord has duly filed when due, including any extensions,
           -----
all tax reports and returns in connection with and in respect of the business,
the Premises and Equipment and have timely paid and discharged all tax
obligations shown thereon. Landlord has made available to Tenant all tax reports
and returns of Landlord for all periods ending prior to the date hereof.

       Landlord has not received notice of any tax deficiency outstanding,
proposed or assessed against or allocable to Landlord or the Premises, nor has
Landlord or any of its partners executed any waiver of any statute of
limitations on the assessment or collection of any tax or executed or filed with
the IRS or any other governmental body any agreement now in effect extending the
period for assessment or collection of any taxes against Landlord or the
Premises.

       There are no tax liens upon, pending against or, to the best knowledge of
Landlord, threatened against the Premises or Equipment.

       (G) Material Contracts. The contracts listed on Exhibit H attached hereto
           ------------------
(the "Scheduled Contracts") and the leases listed on Exhibit I attached hereto
(the "Scheduled Leases") are valid, binding and in full force and effect, have
not been amended or supplemented in any manner or respect except as disclosed on
said Exhibits H

                                       5
<PAGE>

and I. There are no defaults by Landlord thereunder and Landlord knows of no
defaults thereunder by any other party thereto, and, to the best knowledge of
Landlord, no event has occurred that with the lapse of time or action or
inaction by any party thereto would result in a violation thereof or a default
thereunder. Each of the Scheduled Contracts and Scheduled Leases will be
terminated as of the Effective Date, it being understood and agreed that Tenant
will not be assuming any obligations with regards thereto There are no contracts
or leases other than the Scheduled Contracts and Scheduled Leases.

       (H) Employee Plans and Agreements.
           -----------------------------

           (1) There does not exist, nor in the past has there existed, any
  pension plans, profit sharing plans, retirement, stock option, stock purchase,
  incentive, bonus, life, medical, vision, health, disability or accident plans,
  deferred compensation plans, or other employee compensation or benefit plans,
  agreements, practices, written policies, customs, contracts, arrangements or
  commitments, including without limitation severance agreements, holiday,
  vacation or other similar matters, voluntary employees' beneficiary
  associations, other "employee welfare benefit plans" (as defined in Section
  3(1) of ERISA), "employee pension benefit plans" (as defined in Section 3(2)
  of ERISA) or labor union agreements, in each case relating to officers or
  employees (including former officers or employees) of Landlord (or any of its
  affiliates) who perform services to, in the name of or for the benefit of the
  business ("Employees") (collectively "Plans" and individually a "Plan").

           (2) No prohibited transaction exists which could subject Landlord or
  Tenant to any liability or civil penalty assessed pursuant to Section 502(i)
  of ERISA or a Tax imposed by Section 4975 of the Code. Neither Landlord, nor
  any of its affiliates, nor any administrator or fiduciary of any Plan (or
  agent of any administrator or fiduciary of any Plan (or agent of any of the
  foregoing) has engaged in any transaction or acted or failed to act in a
  manner which is likely to subject Landlord to any liability for a breach of
  fiduciary or other duty under ERISA or any other applicable law. The
  transactions contemplated by the Lease and Operative Documents will not be, or
  cause any, prohibited action (within the meaning of Section 406 of ERISA
  and/or Section 4975 of the Code).

       (I) Labor and Employee Relations.
           ----------------------------

           (1) There exists no collective bargaining agreement or other labor
  union contract applicable to any employee of Landlord and no such agreement or
  contract has been requested by any employee or group of employees of Landlord,
  nor has there been any discussion with respect thereto by management of
  Landlord with any employees of Landlord. Landlord has not received any written
  notification of any unfair labor practice charges or complaints pending before
  any agency having jurisdiction thereof nor are there any current union
  representation claims involving any of the employees of Landlord. Further,
  Landlord is not aware of any such threatened charges or claims. All employees
  who perform services to, in the name of or for the benefit of the business are
  employees of Landlord.

           (2) Landlord is not aware of any union organizing activities or
  proceedings involving, or any pending petitions for recognition of, a labor
  union or association as the exclusive bargaining agent for, or where the
  purpose is to organize, any group or groups of employees of Landlord. There is
  not currently pending, with regard to any of its facilities, any proceeding
  before the National Labor Relations Board, wherein any labor organization is
  seeking representation of any employees of Landlord. There are no labor unions
  or labor organizations or associations which have been certified to represent
  any of the employees of Landlord, or which Landlord now recognizes, or in the
  past two (2) years has recognized, as representing any of the employees of
  Landlord.

           (3) Landlord is not aware of any strikes, work stoppages, work
  slowdowns or lockouts nor of any threats thereof by or with respect to any of
  the employees of Landlord. Since the formation of Landlord, there have been no
  labor disputes, strikes, slowdowns, work stoppages, lockouts or similar
  matters involving employees of Landlord.

           (4) There are no arbitration decisions, settlement agreements,
  injunctions, consent decrees or conciliation agreements which affect the
  operation of the business.

           (5) There exists (i) no charge or lawsuit involving any alleged
  violation of any fair employment law, disabilities law, age or any other
  discrimination law, wage payment law, occupational safety and health law,
  or sex discrimination law, and (ii) no threatened or pending litigation
  arising out of any employment relationship, or other employment-related law,
  whether federal, state or local, and (iii) no threatened or pending litigation
  arising out of any employment relationship, presently threatened or pending,
  by any applicant, employee or former employee of Landlord or any
  representative of any such person or persons. No charge or claim involving any
  of the facilities or employees of Landlord is pending before any
  administrative agency, local, state or federal, and no lawsuit involving any
  of such facilities or employees is pending with respect to equal employment
  opportunity, age discrimination, occupational safety, disabilities
  discrimination, or any other discrimination or form of alleged employment
  practice or unfair labor practice.

           (6) Landlord, to the best of its knowledge, complies in all material
  respects with all applicable laws, rules and regulations relating to the
  employment of labor, including, but without limitation, those relating to
  wages, hours, concerted activity, non-discrimination, occupational health and
  safety and the payment and withholding of taxes, and Landlord has no accrued
  liability for any arrears of wages or any taxes (except for wages and taxes
  not yet due and payable) or penalties for failure to comply with any of the
  foregoing.

           (7) Landlord shall be solely responsible for all grievances,
  arbitrations, claims, demands, or charges of any nature whatsoever including,
  but not limited to, any such grievances, arbitrations, claims, demands, or
  charges whether now known or not yet made by any employees, bargaining agents,
  or governmental agencies, which result from or arise out of any event
  occurring on or prior to the Commencement Date; and, Landlord agrees to hold
  harmless and indemnify Tenant for all such claims, if any, asserted against
  Tenant.

                                       6
<PAGE>

  (J)     Licenses and Permits. Landlord possesses all the Permits listed in
          --------------------
Exhibit G attached hereto, copies of all of which have been delivered to Tenant.
Such Permits constitute all the Permits necessary under law or otherwise for
Landlord to conduct the business as now being conducted and to construct, own,
operate, maintain and use the Premises and Equipment in the manner in which they
are now being constructed, operated, maintained and used. Each of such Permits
and Landlord's rights with respect thereto (1) is valid and subsisting, in full
force and effect, and enforceable by Landlord subject to administrative powers
of regulatory agencies having jurisdiction, and (2) following consummation of
the transactions contemplated hereby, will continue to be valid and subsisting
in full force and effect, and enforceable by Tenant without any consent or
approval of any governmental body or third party; or, in lieu of such existing
Permits, replacement or substitute Permits, except as set forth on said Exhibit
G will be available to or obtainable by Tenant in the ordinary course without
any interruption of the conduct of the business following the Commencement Date,
assuming timely application therefor and reasonable diligence in pursuit thereof
by Tenant. Landlord is in compliance in all material respects with the terms of
such Permits. None of such Permits have been, or to the best knowledge of
Landlord, are threatened to be, revoked, canceled, suspended or modified.

  (K)    Environmental Matters. Without in any manner limiting any other
         ---------------------
representations and warranties set forth in this Lease or in the Operative
Documents, except as set forth in Appendix 8.01(K) attached hereto:

           (1)      neither Landlord, nor the Premises or Equipment is or will
  be in violation of, or has violated, or has been or is or will be in non-
  compliance with, any Environmental Laws (as defined below) (including both
  current and prospective requirements thereof) in connection with the
  ownership, use, maintenance or operation of, or conduct of business related
  thereto; and

           (2)      without in any manner limiting the generality of (1) above:

                    (i)    except in accordance with Environmental Laws
           (including, without limitation, the obtaining of necessary Permits),
           no Materials of Environmental Concern (as defined below) have been
           used, generated, manufactured, stored or treated, or disposed of,
           landfilled or in any other way released (and no release is
           threatened), on, under or about the Premises or transported to or
           therefrom, and to the best knowledge of Landlord, no Materials of
           Environmental Concern have been generated, manufactured, stored or
           treated or disposed of, landfilled or in any other way released (and
           no release is threatened), on, under, about or from any property
           adjacent to the Premises;

                    (ii)   to the best knowledge of Landlord there has been no
           disposal, release or threatened release of any Materials of
           Environmental Concern on, under or from the Premises and Landlord is
           not now, and it will not be in the future, as a result of the
           operation or condition of the business prior to or at the
           Commencement Date, subject to any (a) contingent liability in
           connection with any release or threatened release of any Materials of
           Environmental Concern into the environment whether on, under or off
           the Premises or (b) removal, reclamation or remediation requirements
           under Environmental Laws, or any reporting requirements related
           thereto;

                    (iii)  Landlord has not been named as a potentially
           responsible party under, and the Premises has not been nominated or
           identified as a facility which is subject to an existing or potential
           claim under any Environmental Laws (as defined below), and the
           Premises is not subject to any lien arising under Environmental Laws;

                    (iv)   Landlord has all environmental and pollution control
           equipment necessary for compliance in all material respects with all
           Environmental Laws, including the current and prospective
           requirements thereof, (including, without limitation, all applicable
           Permits) and operation of the business as it is presently conducted
           and to the best knowledge of Landlord no material capital or other
           expenditures are currently necessary or reasonably foreseeable in
           order to comply with any Environmental Laws ;

                    (v)    no Materials of Environmental Concern have been
           incorporated into the Premises or Equipment;

                    (vi)   there are no underground storage tanks, pits, sumps
           or impoundments (as defined under Environmental Laws) located on or
           under the Premises, except as disclosed in Appendix 8.01(K) attached
           hereto;

                    (vii)  Landlord has not been named as a potentially
           responsible party in connection with any off-site locations to which
           Materials of Environmental Concern have been sent by or on behalf of
           Landlord for disposal, storage, recycling, or processing and none of
           the off-site locations where Materials of Environmental Concern from
           the Premises or from any of the assets of Landlord have been stored,
           treated, recycled, disposed of or released, has been nominated or
           identified as a facility which is subject to an existing or potential
           claim under any Environmental Laws, or for violation or revocation of
           any of its RCRA or other storage, transfer, recycling or disposal
           permits;

                    (viii) Landlord has not received any notices of any release
           or threatened release of Materials of Environmental Concern, or of
           any violation of, noncompliance with, or remedial obligation under,
           Environmental Laws, relating to the ownership, use, maintenance,
           operation of, or conduct of the business or assets of Landlord, nor
           is there any basis for any of the foregoing;

                    (ix) there are no notices of violations, notices of
           potential liability, writs, injunctions, decrees, orders or judgments
           outstanding, or lawsuits, claims, proceedings or investigations
           pending or, to the best knowledge of Landlord, threatened, relating
           to the ownership, lease, use, maintenance, operation of, or conduct
           of the business or assets of Landlord under or in respect of any
           Environmental Laws, nor is there any basis for any of the foregoing;

                    (x)  there are no obligations, undertakings or liabilities
           arising out of or relating to Environmental Laws which Landlord has
           agreed to, assume or retain, by contract or otherwise; and

                                       7
<PAGE>

                    (xi) Landlord has provided or made available to Tenant all
           files and records in the possession or control of Landlord and
           relating to the Premises and the business, as to (i) compliance of
           prior and current activities on, or related to the Premises with
           Environmental Laws (including environmental monitoring data,
           investigations, studies and reports); (ii) environmental audit
           reports; (iii) spill notifications; (iv) notices and correspondence
           to and from governmental bodies; (v) permits, approvals,
           authorizations, licenses, and applications therefor; (vi) hazardous
           waste manifests; (vii) emergency and safety procedures; (viii)
           inspection reports; (ix) reclamation, contingency and closure plans;
           and (x) other documents or materials pertaining to compliance with
           Environmental Laws, permitting or possible environmental claims or
           liabilities.

As used in this Lease, (i) "Materials of Environmental Concern" shall mean any
                            ----------------------------------
solid or hazardous waste, hazardous substance, pollutant, contaminant, oil,
petroleum product, commercial product or other substance (x) which is listed,
regulated or designated as toxic or hazardous (or words of similar meaning and
regulatory effect), or with respect to which remedial, removal or reclamation
obligations may be imposed, under any Environmental Laws or (y) exposure to
which may pose a health or safety hazard, and (ii) "Environmental Laws" means
                                                    ------------------
any applicable federal, state, or local laws, rules, or regulations, common law
or strict liability provisions, and any judicial or administrative
interpretations thereof, including any judicial or administrative orders or
judgments, relating to health, safety, industrial hygiene, exposure to any
persons on or off the Premises to any Materials of Environmental Concern,
pollution or environmental matters enacted, promulgated or in effect as of the
Commencement Date.

     (L)   Solvency. Landlord is not now insolvent, nor will Landlord be
           --------
rendered insolvent by the occurrence of the transactions contemplated by this
Lease. In addition, immediately after giving effect to the consummation of the
transactions contemplated by this Lease, (1) Landlord will be able to pay its
respective debts as they become due, (2) the properties of Landlord do not and
will not constitute unreasonably small capital, and Landlord will not have
unreasonably small capital or will have insufficient capital with which to
conduct its respective present or proposed business and (3) taking into account
pending and threatened litigation, final judgments against Landlord in actions
for money damages are not reasonably anticipated to be rendered at a time when,
or in amounts such that, Landlord will be unable to satisfy any such judgments
promptly in accordance with their terms (taking into account the maximum
probable amount of such judgments in any such actions and the earliest
reasonable time at which such judgments might be rendered). The cash available
to Landlord, after taking into account all other anticipated uses of the cash of
Landlord, will be sufficient to pay all such judgments promptly in accordance
with their terms. As used in this Section, (x) "insolvent" means, for any
                                                ---------
person, that the sum of the present fair saleable value of its assets does not
and/or will not exceed its debts and other probable liabilities, and (y) the
term "debts" includes any legal liability, whether matured or unmatured,
liquidated or unliquidated, absolute, fixed or contingent, disputed or
undisputed or secured or unsecured.

     (M)   Customers and Suppliers. Appendix 8.01(M) attached hereto sets forth
           -----------------------
a true and correct list of (i) the ten (10) largest customers of the business in
terms of sales during the calendar quarter ended September 30, 2000, showing the
approximate total sales to each such customer during such period. Except to the
extent set forth in said Appendix 8.01(M), there has not been any material
adverse change in the business relationship of Landlord with any such customer.

     (N)   Disclosure.
           ----------

           (1) No representation or warranty of Landlord contained in this Lease
     contains any untrue statement. No representation or warranty of Landlord
     contained in this Lease omits to state a material fact necessary in order
     to make the statements herein or therein, in light of the circumstances
     under which they were made, not misleading. All estimates or projections
     communicated by Landlord to Tenant were reasonably made, in good faith,
     based upon assumptions reasonable under the circumstances.

           (2) There is no fact to the best knowledge of Landlord which has
     specific application to Landlord, the Premises, Equipment or the business
     (other than general economic or industry conditions) and which could have a
     material adverse effect which has not been set forth in this Lease.

SECTION 8.02 REPRESENTATIONS AND WARRANTIES OF TENANT.

     Tenant represents and warrants to Landlord that the following are true and
correct on and as of the date of this Lease and will be true and correct through
the Commencement Date as if made on and as of that date:

     (A)     Tenant is a limited partnership duly organized, validly existing
and in good standing under the laws of the State of Delaware and is qualified to
transact business and is in good standing as a foreign limited partnership in
the jurisdictions where it is required to qualify in order to conduct its
businesses as presently conducted except where the failure to be qualified would
not have a material adverse effect.

             Tenant has the partnership power and authority to own, lease or
operate all properties and assets now owned, leased or operated by it and to
carry on its businesses as now conducted.

     (B)     Tenant may execute, deliver and perform this Lease without the
necessity of Tenant obtaining any consents approval, authorization or waiver or
giving any notice or otherwise, except for the authorization of the Board of
Directors of Tenant referenced in paragraph (d) below and such consents,
approvals, authorizations, waivers and notices which have been obtained and are
unconditional and are in full force and effect and such notices which have been
given.

     (C)     The execution, delivery and performance of this Lease do not and
will not:

             (1)  constitute a violation of the Partnership Certificate or
     Partnership Agreement of Tenant; (2) constitute a violation of any statute,
     judgment, order, decree or regulation or rule of any governmental body
     applicable or relating to Tenant; or (3) constitute a default under any
     contract to which Tenant is a party.

     (D)     This Lease has been duly authorized by the Board of Directors of
Tenant and constitutes the legal, valid and binding obligation of Tenant,
enforceable in accordance with its terms, except as may be limited by

                                       8
<PAGE>

bankruptcy, reorganization, insolvency and similar laws of general application
relating to or affecting the enforcement of rights of creditors and subject to
general principles of equity.

                                   ARTICLE 9

                 SUBORDINATION, ATTORNMENT AND NON-DISTURBANCE
                          AGREEMENT, ESTOPPEL LETTERS

SECTION 9.01: SUBORDINATION. This Lease, and the lien thereof, shall not be
subordinated to the lien of any ground lease or mortgage or deed of trust
(irrespective of the execution or recordation date thereof), placed upon the
Premises and/or Equipment unless the Landlord shall first cause the ground
Landlord or mortgagee or beneficiary to execute a Subordination, Attornment and
Non-Disturbance Agreement in form acceptable to Tenant.

SECTION 9.02: ATTORNMENT. In the event of (i) a transfer of Landlord's interest
in the Premises and/or Equipment or (ii) any proceeding brought for the
termination or foreclosure of, or the exercise of the power of sale under any
mortgage or deed of trust affecting the Premises and/or Equipment or any ground
or underlying lease made by Landlord, then and in any of such events, Tenant
shall attorn to and recognize the purchaser or the transferee of Landlord's
interest as Landlord under this Lease for the balance then remaining of the
Lease term, or any extension thereof, providing said purchaser or transferee
shall agree to accept such attornment and to undertake and be bound by all of
the terms and conditions of this Lease and such purchaser or transferee first
shall execute a Subordination, Attornment and Non-Disturbance Agreement in form
acceptable to Tenant.

SECTION 9.03: ESTOPPEL LETTER. Tenant and Landlord each agree that, within
thirty (30) days after written request to provide to the other, at the cost and
expense of the requesting party, or its mortgagee, beneficiary or purchaser, an
estoppel letter certifying to the best of it's knowledge whether this Lease is
in full force and effect, that this Lease has not been amended or modified
except as noted in the letter, the amount of annual rent paid and the date to
which rents have been paid.

                                  ARTICLE 10

                                 FORCE MAJEURE

         If Landlord or Tenant shall, as a result of any force majeure, fail to
timely perform any obligation to be performed under this Lease, then such
failure shall be excused and shall not be deemed to be a breach of this Lease by
the party in question, and the time allotted said party to so perform its
obligation shall be extended by a period equal to the time such delay continues.
The affected party's performance shall be diligently commenced and carried to
completion when the force majeure ends. As used herein, force majeure shall mean
strikes, lockouts or labor disputes, inability to obtain labor or materials (or
reasonable substitutes therefor) or acts of God, enemy or hostile governmental
action, civil commotion, or fire or other similar casualty or cause.

                                  ARTICLE 11

                   ALTERATIONS BY TENANT -- MECHANICS' LIENS

SECTION 11.01: ALTERATIONS. Tenant shall have the right to make any and all
repairs, alterations, modifications, improvements and additions (collectively,
"alterations") to the Premises, including without limitation those described on
Exhibit K attached hereto and made a part hereof.

SECTION 11.02: TENANT'S WORK. Any alterations made by Tenant pursuant to Section
11.01 shall be done at Tenant's sole cost and expense, and performed in a
workmanlike manner. Tenant shall comply with all laws, regulations and
ordinances applicable to the performance of the work. Landlord and Tenant agree
that Tenant shall not have any obligation at the end of the term hereof to
remove the alterations nor to restore the Premises to its original condition;
provided however, that Tenant shall at all times retain title to any alterations
made to the Premises which are in the nature of Tenant's trade fixtures,
personal property and equipment, and upon the expiration of the Lease term,
Tenant shall be entitled to remove the same from the Premises, provided that
Tenant leave the Premises generally, in working condition, and repair any damage
occasioned by the removal of such improvements, alterations, trade fixtures,
personal property and equipment of Tenant, ordinary wear and tear and damage by
casualty or condemnation excepted.

SECTION 11.03: LANDLORD'S ALTERATIONS. Landlord agrees that it will make no
changes, alterations or additions to the Premises, including the Improvements
thereon, nor take any action which reduces the parking areas or which alters in
any way the access to such parking areas or to the Premises from that which
exists as of the Effective Date, without the prior written consent of Tenant.

SECTION 11.04: MECHANIC'S LIENS.      Tenant will pay or cause to be paid all
charges for all of Tenant's Work and for all other work done by Tenant on or
about the Premises during the term of this Lease and will not suffer or permit
any mechanic's, materialmen's, or similar liens for labor and materials
furnished to the Premises during the term of the Lease by or on the account of
Tenant. If any such lien shall be filed, Tenant will either pay the same or
procure the discharge thereof by giving security or in such other manner as may
be required or permitted by applicable law within thirty (30) days of the filing
thereof. Notwithstanding the foregoing, Tenant shall have the right, at its sole
cost and expense, in its name or in the name of the Landlord, or both, to
contest any such lien, provided the Tenant shall provide a bond or other
security sufficient to protect Landlord's interest in the Premises.

                                  ARTICLE 12

                      MAINTENANCE AND REPAIR OBLIGATIONS

         Tenant agrees that during the term of this Lease, Tenant will keep and
maintain in good order, condition and repair the interior and exterior of the
Premises, but in all cases excluding ordinary wear and tear and damage by fire,
the elements, casualty or condemnation.

                                       9
<PAGE>

                                  ARTICLE 13

                                   UTILITIES

SECTION 13.01: ELECTRICITY, GAS, WATER AND SEWER. Electricity, gas, water and
sewer will be available to the Premises and shall be metered in Tenant's name.
Tenant will make all utility payments directly to the public utility company
based upon Tenant's metered usage. Tenant acknowledges that natural gas is not
available to the Premises.

SECTION 13.02: INTERRUPTION OF UTILITY SERVICE. Landlord shall not be liable in
the event utility service to the Premises is interrupted by fire, riot,
accident, strikes or any other similar cause beyond Landlord's control, except
as may be occasioned by Landlord's negligence, bad faith and willful misconduct,
and Landlord agrees to cooperate in the prompt restoration of any such
interrupted service.

         Notwithstanding the foregoing, in the event that during the term of
this Lease Tenant is unable to obtain an annual water allocation equal to 25
acre feet of water based upon the acreage of the Premises either from San Luis
Water Improvement District or in combination with water purchased by Tenant at a
commercially reasonable price, Tenant on 90 days notice may terminate this
Lease.

                                  ARTICLE 14

                     OBSERVANCE OF LAWS, REGULATIONS, ETC.

SECTION 14.01: TENANT'S OBLIGATIONS. Tenant agrees to observe and comply, at its
sole cost and expense, with all laws, regulations and ordinances of all
governmental authorities now or hereafter in force applicable to the conduct of
its operations upon the Premises.

         Tenant shall notify Landlord within 24 hours of Tenant becoming aware
of any release at or from the Premises of any Material of Environmental Concern
at a level or concentration that would require remediation of the release or the
notification thereof by Tenant or Landlord to any governmental body under any
Environmental Law. In the event of an emergency wherein such a release could
imminently endanger human health or the environment, Tenant shall endeavor to
inform the Landlord immediately. Tenant's obligations herein are not dependent
upon its receipt of any notice of noncompliance or concern by any governmental
body. Further, Tenant shall notify Landlord within 24 hours after it has
received from any governmental body any notice of violation of any Environmental
Law or any other notification of any incident, situation, or condition that
could result in an environmental claim at or in connection with the Premises.

SECTION 14.02: LANDLORD'S OBLIGATION. Except for Tenant's obligations under
Section 14.01, Landlord agrees to observe and comply, at its sole cost and
expense, with all laws, regulations and ordinances of all governmental
authorities now or hereafter in force relating to the Premises and this Lease.
Specifically, and without limiting the generality of the foregoing, Landlord
hereby covenants and agrees to make all applications, filings and renewal
requests as may be necessary to maintain the USTs in compliance with all
applicable laws, including Environmental Laws, provided however that Tenant
shall pay or reimburse to Landlord any filing or license renewal fee in
connection therewith.

                                  ARTICLE 15

                                  ASSIGNMENT

SECTION 15.01: RELATED PARTY: SALE OF BUSINESS. Subject to Landlord's consent,
which shall not be unreasonably withheld, delayed or conditioned, Tenant shall
have the absolute right to assign Tenant's interest under the Lease, in whole or
in part, or sublease any interest in and to the Premises, provided: (i) Tenant
shall not then be in default in the performance and observance of the terms and
provisions of this Lease, and (ii) such transferee shall assume all of the
obligations of this Lease on the part of Tenant to be performed.

SECTION 15.02: RELEASE OF LIABILITY. Should Tenant make an assignment or enter
into a sublease in accordance with the provisions of Section 15.01 above, Tenant
shall not be released from any and all liability under this Lease, without
obtaining the prior written consent of Landlord, which consent shall not be
unreasonably withheld or delayed.

SECTION 15.03: LEASEHOLD MORTGAGES. Tenant may execute and deliver one or more
mortgages, deeds of trust or other leasehold security agreements ("Leasehold
Mortgages") without consent of Landlord, in favor of any lender to Tenant (a
"Leasehold Lender"). Landlord agrees to provide to any such Leasehold Lender
notice of an event of default hereunder and provide such Leasehold Lender the
same opportunity to cure such default as Tenant is herein provided. Upon
request, Landlord agrees to acknowledge its consent to such Leasehold Mortgage
in writing to such Leasehold Lender. Further, Landlord hereby agrees to
subordinate in favor of any such Leasehold Lender, all liens and security
interests it may have in any of Tenant's trade fixtures, equipment or personal
property located within the Premises, and in connection therewith, upon request,
to execute a subordination agreement with regards thereto, in such form as may
be reasonably acceptable to Landlord and Lender.

                                  ARTICLE 16

                           INSURANCE AND SUBROGATION

         (A)   During the term of this Lease, Tenant hereby covenants and
agrees, at its sole expense, to keep the Premises and Equipment fully insured
against damage caused by fire and other risks and to maintain liability
insurance with respect to the operation of its business on the Premises, in such
amounts, with such insurers and with such coverages as are consistent with the
coverages maintained by Tenant in the operation of Tenant's business and other
truck stop facilities. Tenant may maintain any insurance coverages required by
the terms of this Lease under a blanket policy covering other assets of Tenant.

         (B)   Tenant agrees to furnish Landlord copies of the policies or
certificates of insurance described in subparagraph (A) above upon request.

                                      10
<PAGE>

         (C)   Each fire and liability insurance policy obtained and maintained
by either Landlord or Tenant with respect to the Premises and Equipment shall
contain appropriate clauses pursuant to which the insurance companies issuing
such policies (i) waive all rights of subrogation against Landlord and Tenant,
as applicable, with respect to losses payable under such policies and/or (ii)
agree that such policies shall not be invalidated because the insured has hereby
waived any and all right of recovery against Tenant for losses covered by such
policies.

         (D)   Landlord hereby waives any and all rights of recovery which it
might otherwise have against Tenant, its directors, officers, partners,
servants, agents, or employees, for any loss, injury, or damage to the extent
the same is covered by Landlord's insurance, notwithstanding that such loss,
injury, or damage may result from the negligence or fault of Tenant, its
directors, officers, partners, servants, agents or employees. Tenant hereby
waives any and all right of recovery which it might otherwise have against
Landlord, its partners, officers, servants, agents, or employees, for any loss,
injury, or damage to the extent the same could be covered by insurance,
notwithstanding that such loss, injury or damage may result from the negligence
or fault of Landlord, its partners, officers, servants, agents, or employees.

                                  ARTICLE 17

                            DAMAGE AND DESTRUCTION

SECTION 17.01: DAMAGE TO PREMISES

      (A)   In the event, at any time after the execution of this Lease, the
Premises or any part thereof shall be damaged or destroyed by fire, riot, war,
explosion, the elements or any other cause or casualty, then, except as provided
in subparagraph (B) below, this Lease shall continue in full force and effect
and the Premises shall be restored to the condition existing prior to the damage
or destruction without consideration for wear and tear as herein provided.

      (B)   If any such damage or destruction shall occur during the last year
of the term hereof, or in the event the repair and rebuilding of the Premises
and the Improvements cannot be reasonably completed within sixty (60) days, then
Tenant shall have the option to terminate this Lease as of the date of the
casualty, by tendering written notice of such election to Landlord within thirty
(30) days following such casualty. If at any time during the term of this Lease
Tenant's improvements and fixtures are damaged to the extent of more than one-
third (1/3) of the replacement cost of all of Tenant's fixtures, Tenant shall
have the right in addition to its other rights and remedies to terminate this
Lease upon tendering written notice of such election to Landlord within thirty
(30) days from the date of such damage. Rent and other charges shall be
prorated, as of the termination date.

      In the event Tenant does not elect to terminate this Lease as provided
herein, the Premises shall be repaired and restored as herein required.

SECTION 17.02: DAMAGE TO EQUIPMENT. Except as provided in Section 16 (D) above,
in the event that during the term of this Lease the Equipment, or any portion
thereof, is lost, stolen, destroyed or damaged, upon receipt of the insurance
proceeds with respect thereto, Tenant shall, to the extent of the insurance
proceeds, cause such Equipment to be repaired or replaced with comparable items.

SECTION 17.03: RESTORATION WORK. All restoration work required to be performed
under this Article 17 shall be done by a contractor acceptable to Landlord and
Tenant, and shall be done in a first class manner, using only new materials, and
in accordance with all applicable laws. Tenant shall submit to Landlord the
plans and the timetable for completion of the restoration work within thirty
(30) days of the date of the damage, casualty or destruction, and Landlord shall
have fifteen (15) days within which to approve the same; provided, however, that
in the event Landlord fails to respond within said fifteen (15) day period, such
plans and timetable shall be deemed approved. Thereafter, Tenant shall commence
such restoration work and thereafter shall diligently pursue such restoration
work to completion. All insurance proceeds shall be made available to Tenant for
the repair and restoration of the Premises. Rent shall abate for the period of
time that Tenant is diligently pursuing restoration of the Premises.

                                  ARTICLE 18

                                 CONDEMNATION

SECTION 18.01: ENTIRE OR PARTIAL TAKING OF THE PREMISES. Should the entire
Premises be taken by any public authority by the exercise of any right of
eminent domain or in condemnation proceedings, or by transfer under a reasonable
threat of condemnation, the term hereof shall cease and terminate as of the
earlier of the date when possession is taken by or title vests in the condemning
authority ("Taking Date"). Except as provided in Section 18.02, should only a
part of the Premises be taken by or transferred to any public authority, then
the term hereof shall cease and terminate only as to the part taken on the
Taking Date. Rent, and any other charges due hereunder, shall be paid only to
the Taking Date. In the event of a partial taking or transfer, a pro rata
abatement of rent and any other charges due hereunder shall be effected as of
the Taking Date for the balance of the term of the Lease.

SECTION 18.02: PARTIAL TAKING AND TERMINATION. In the event of a partial taking
or transfer, as provided in Section 18.01, if the remaining portion of the
Premises is of such reduced shape or area as to, in Tenant's sole opinion,
restrict the use, possession or operation of the Premises, then Tenant reserves
the right to terminate this Lease, at Tenant's sole and reasonable discretion,
without liability therefor, at any time after the Taking Date, by thirty (30)
days written notice to Landlord, and upon such termination date, this Lease
shall cease and terminate.

SECTION 18.03: PARTIAL TAKING -- NO TERMINATION. If this Lease is not terminated
by Tenant pursuant to Section 18.02, it shall continue in force as to the
remaining portion of the Premises. Commencing on the Taking Date and continuing
for the remainder of the term of this Lease, or for the duration of the taking
or transfer, if less than the entire remaining term, Rent shall abate and all
other charges shall be reduced in proportion to the area of the Premises so
taken. Landlord agrees to promptly commence and thereafter diligently pursue
repairs, restoration and all improvements necessary to make the remaining
portion of the Premises constitute a complete architectural unit containing like
facilities as previously furnished. Should Landlord fail for any reason
whatsoever, within or beyond Landlord's control (including any force majeure) to
diligently pursue and to complete said repairs,

                                      11
<PAGE>

restoration and all other improvements as herein stated on or before one hundred
eighty (180) days subsequent to the Taking Date, then Tenant shall have the
right at any time to cancel this Lease upon ten (10) days written notice to
Landlord.

SECTION 18.04: LANDLORD'S AND TENANT'S AWARD. Tenant shall be entitled to submit
a claim for and to receive an allowance or award for loss of business or
depreciation to, damage to or cost of removal of, or for value of trade
fixtures, leasehold improvements, furniture and other personal property
belonging to Tenant, and any other loss, damage, or claim allowed to Tenant by
law.

                                  ARTICLE 19

                                     SIGNS

         Tenant hereby is granted the right, in conformity with the requirements
of applicable law, to erect such signs in, on, or about the Premises as Tenant
may desire. Landlord, upon request, agrees to execute any necessary consents or
applications which may be required by law to permit the erection of signs.
Tenant may remove, replace, or alter all sign(s) at any time and from time to
time, provided that Tenant shall repair any material damage resulting therefrom.

                                  ARTICLE 20

                                    DEFAULT

SECTION 20.01: TENANT'S DEFAULTS. Tenant shall be deemed to be in default
hereunder if: (i) Tenant fails to pay the Rent or other charges on the date due
and such failure continues for fifteen (15) days after written notice from
Landlord thereof; or (ii) Tenant fails to perform or observe any other term or
condition contained in this Lease within thirty (30) days after written notice
from Landlord thereof. In any of such events, Landlord may, immediately or at
any time thereafter, and without demand or notice, enter into and upon the
Premises, or any part thereof, and repossess the Premises and Equipment, and
expel Tenant and those claiming through or under Tenant and remove Tenant's
effects, all without force or breach of the peace, and without prejudice to any
remedies which might otherwise be permitted for default under this Lease, and
upon entry as aforesaid, Landlord may either (a) terminate this Lease in which
event Landlord shall be entitled to recover from Tenant the unpaid rent which
has been earned at the time of termination, plus the amount by which the unpaid
rent which would have been earned for the balance of the term exceeds the amount
such rental loss that the Tenant proves could have been reasonably avoided, plus
any other amount necessary to compensate Landlord for all the determent
approximately caused by Tenant's failure to perform its obligations under this
Lease; or (b) without terminating this Lease, make such alterations and relet
the Premises or any part thereof for such term or terms and at such rental or
rentals and upon such other terms and conditions as Landlord in its sole
discretion my deem advisable, and all rentals received by Landlord from such
reletting shall be applied to the payment of any indebtedness other than rent
due hereunder from Tenant to Landlord, second, to the payment of any cost or
expense of such reletting, and third, to the payment of rent due and unpaid
hereunder, and being understood that if such rentals received from such
reletting during any month be less than that to be paid during that month by
Tenant hereunder, Tenant shall pay any such deficiency to Landlord, the same
calculated and paid monthly notwithstanding any such reletting without
termination, Landlord may at any time thereafter elect to terminate this Lease
for such prior material default or breach.

SECTION 20.02: LANDLORD'S DEFAULT. In the event Landlord fails to perform or
observe any term or condition contained in this Lease within thirty (30) days
after notice from Tenant, or in such time as may be otherwise provided herein,
Tenant may but shall not obligated to (a) cancel this Lease upon written notice
to Landlord, (b) take any action appropriate under the circumstances to preserve
its possession and rights under this Lease, (c) perform any obligation or duty
of the Landlord which the Landlord refuses or neglects to perform, and in any
such event, Tenant may notify Landlord of the cost and expense thereof in which
event Landlord shall, upon demand, immediately reimburse Tenant for said cost
and expense, and in the event Landlord fails to reimburse Tenant within fifteen
(15) days of the demand therefore, Tenant shall be entitled to offset such
amounts against future installments of Rent as the same become due or against
the Option Price, if applicable, and at Tenant's option, and/or (d) pursue any
other remedy available at law or in equity.

SECTION 20.03:  CURE OR STAY OF DEFAULT

      In the event the default of Landlord or Tenant cannot be cured within the
grace periods provided in Section 20.01 or 20.02, such default shall be deemed
to have been cured if the defaulting party shall have commenced compliance
within such grace period, and continues to prosecute the same with due
diligence.

                                  ARTICLE 21

                                PURCHASE OPTION

         In consideration of the Rent to be paid during the term of this Lease
by Tenant to Landlord, Tenant is hereby granted the exclusive option to purchase
(the "Option") the Premises (including the Equipment) for the Option Price (as
defined below).

         Closing of the sale under the Option shall occur within ninety (90)
days after the date of such Exercise Notice, at the San Jose, California offices
of Commonwealth Land Title, 333 W. Santa Clara Street, Suite 110, San Jose,
California 95113, an affiliate of LandAmerica Financial Group, Inc., 7557
Rambler Road, Suite 1200, Dallas, Texas 75201 (the "Title Company").

         (A)     Option Price. Should Tenant elect to exercise its Option, the
                 ------------
purchase price for the Property (the "Option Price") shall be the amount of Five
Million and No/100 Dollars ($5,000,000.00), exclusive of the Rent for the Lease
year during which the Option is exercised, prorated to the date of closing of
such Option, subject to adjustment as provided below.

         The amount of the Option Price shall be adjusted as provided under the
terms of this Lease and as a result of the proration and allocation of closing
costs as provided below. To the extent that for any reason an allocation of the
Option Price is required as between the Real Property and Improvements, on one
hand, and the Equipment

                                      12
<PAGE>

on the other, such allocation shall be made based upon the respective fair
market values thereof as reasonably determined by Landlord and Tenant as of the
date of the Exercise Notice or as of the date on which Tenant attempts delivery
of the Exercise Notice. The Option Price shall be payable in cash or other
readily available funds to Landlord at the time of closing. It is understood and
agreed that Landlord shall agree to the allocation of the Option Price and that
Tenant shall be deemed to have satisfied its obligation by the tender of such
funds to Landlord.

         (B)      The Property. Specifically, and without limiting the
                  ------------
generality of the foregoing, the property subject to the exercise of the Option
shall include the Premises, Improvements and the Equipment, together with such
lease agreements, sales and service contracts, warranties, guarantees,
indemnities, supplier and vendor contracts, customer and supply lists,
intellectual property rights, books and records and all other assets used in the
operation of the business of the San Luis Travel Plaza, as identified and
selected by Tenant, as well as all right to use of the name "San Luis Travel
Plaza". The assets shall not include any accounts receivable, accrued expenses,
cash or goodwill, and Tenant shall not be obligated to assume any contracts,
leases, liabilities or other obligations of Landlord other than those
specifically selected and accepted by Tenant in writing.

         (C)      Conveyance and Closing.  At the time of closing of the Option:
                  ----------------------

                  i) Landlord shall convey to Tenant good, marketable and
         indefeasible title to the Premises by general warranty deed, in form
         acceptable to Tenant, free and clear of all liens, claims and
         encumbrances, and subject only to taxes for the year during which the
         closing occurs, prorated to the date of such closing date, and to those
         matters shown on Schedule B of the Title Commitment attached hereto and
         made a part hereof as Exhibit E (the "Permitted Encumbrances"). At the
         time of closing Tenant shall be provided an ALTA standard form Owner's
         Policy of Title Insurance, including any endorsements required by
         Tenant, issued by the Title Company covering the Premises in the amount
         of $5,000,000, insuring good, marketable, and indefeasible title to the
         Property in favor of Tenant, free and clear of all liens and
         encumbrances, and subject only to the Permitted Exceptions.

                  Within fifteen (15) days of the Exercise Notice, Landlord, at
         its sole cost and expense shall provide to Tenant an updated Title
         Commitment issued by the Title Company, confirming the current liens,
         encumbrances, claims and other matters of record affecting the
         Premises. Landlord hereby represents and warrants to Tenant that as of
         the date of this Agreement the Premises is subject to no liens,
         encumbrances, claims or other matters of record, other than the
         Permitted Encumbrances. Landlord hereby covenants and agrees that
         during the term of the Option, that Landlord will not mortgage, pledge,
         hypothecate, transfer, grant a lien in or further encumber the
         Premises.

                  (ii) Landlord shall convey to Tenant good, marketable and
         indefeasible title to the Equipment by general warranty bill of sale in
         form satisfactory to Tenant in all respects, free and clear of all
         liens. Landlord warrants and represents to Tenant that as of the
         Commencement Date, the Equipment is not subject to any liens and
         security interests in favor of a third party. Landlord hereby covenants
         and agrees that during the term of the Option that Landlord will not
         mortgage, pledge, hypothecate, transfer, grant a security interest in
         or encumber the Equipment. Within fifteen (15) days of the Exercise
         Notice and then again as of the date of closing of the Option, Landlord
         at its sole cost and expense shall furnish to Tenant then current UCC
         lien, tax and judgment searches with respect to Landlord from the
         Secretary of State's office in California and the County Clerk's
         Records in Merced County, California, reflecting any liens and security
         interests against the Equipment and any other matters affecting
         Landlord and the Equipment, which searches shall be satisfactory to
         Tenant in all respects. The Option Price shall be disbursed at closing
         in such a manner so as to secure releases of any Equipment liens as of
         the date of closing of the Option.

                  (iii) Landlord hereby covenants and agrees that at the time of
         closing of the Option that it shall execute and deliver to Tenant a
         General Warranty Deed, Bill of Sale and such additional documents of
         transfer and assignment as may be necessary or requested by Tenant to
         complete the acquisition of the Property, including without limitation
         the assignment of all warranties and guarantees with respect to any of
         the Property, any required withdrawal or assignment of trade/business
         names as to "San Luis Travel Plaza", and any assignments or
         re-registrations with regards to the USTs.

                  (iv) At the time of closing of the Option, Tenant shall
         deliver the Option Price, as adjusted, to Landlord, for the benefit of
         Landlord, in cash or by wire transfer or cash equivalent. Landlord
         shall pay the expense of any premium for Owner's Policy of Title
         Insurance (exclusive of endorsements required by Tenant, which shall be
         paid for by Tenant), its own attorney's fees and all other usual and
         customary closing fees and recording charges will be shared equally by
         Landlord and Tenant.

         (G)      Default. In addition to the other rights and remedies provided
                  -------
under the terms of this Lease, in the event either party fails to perform any of
the covenants expressly set forth in this Section 21, then the non-defaulting
party shall be entitled to exercise all rights and remedies available at law or
in equity to enforce the terms of the Option, including without limitation, the
right to enforce specific performance. In the event such non-defaulting party
retains attorneys to protect or enforce its rights hereunder and prevails, then
the defaulting party agrees to pay the other party's reasonable attorney's fees
incurred by such other party for the enforcement of the terms hereof.

                                  ARTICLE 22

                                INDEMNIFICATION
                                ---------------
SECTION 22.01  INDEMNITY.

      (a)    Subject to Section 22.01(C) hereof, Landlord agrees to indemnify
and hold Tenant and Tenant's partners, officers, directors, shareholders,
affiliates, employees, agents and employee plan fiduciaries ("Tenant
                                                              ------
Indemnitees") harmless from any and all damages, losses, liabilities (joint or
-----------
several), payments, obligations, penalties, claims, response or remediation
costs, litigation, demands, defenses, judgments, suits, proceedings, costs,
disbursements or expenses (including without limitation, fees, disbursements and
expenses of attorneys, accountants, consultants and other professional advisors
or contractors and of expert witnesses and costs of

                                      13
<PAGE>

investigation and preparation) of any kind or nature whatsoever (collectively
"Damages"), directly or indirectly resulting from, relating to or arising out
 -------
of:

                (1)  any breach of or inaccuracy in any representation or
         warranty of Landlord contained in this Lease, and all other agreements,
         instruments, documents, and certificates executed and delivered by or
         on behalf of Landlord in connection herewith or in connection with the
         Option or closing thereunder (collectively, the "Operative
         Document(s)");

                (2)  any breach or non-performance, partial or total, by
         Landlord of any covenant or agreement of Landlord contained in this
         Lease or in any Operative Document;

                (3)  any actual or threatened violation of or non-compliance
         with, or remedial, removal or reclamation obligation arising under, any
         Environmental Laws arising from any event, condition, circumstance,
         activity, practice, incident, action or plan existing or occurring
         prior to the Commencement Date relating in any way to the Premises,
         Equipment, or the business (including without limitation the ownership,
         operation or use of the Premises, Equipment and the conduct of the
         business thereon prior to the Commencement Date; the products
         manufactured or sold by Landlord; air emissions from or ground water
         contamination in, on, under or affecting the Premises and the business;
         the presence of all underground or above ground storage tanks or any
         Materials of Environmental Concern on, in, under or affecting all or
         any portion of the Premises and Equipment, or any surrounding areas,
         and any release or threatened release of any Materials of Environmental
         Concern; and the storage, disposal or treatment, or transportation for
         storage, disposal or treatment, of, Materials of Environmental
         Concern);

                (4)  the ownership, management or use of the Premises and
         Equipment prior to the Commencement Date; the conduct of the business
         prior to the Commencement Date; the products manufactured or sold by
         Landlord (other than damages attributable to defects that are in
         products in inventory at the Commencement Date to the extent the
         defects resulted from Tenant's negligence after the Commencement Date);
         all contracts, agreements, obligations, commitments and liabilities of
         Landlord of every kind and character relating in any way to the
         business, Premises or Equipment; Landlord's noncompliance with bulk
         transfer laws, if any, or any similar law in connection with the lease
         of the Premises and Equipment, the purchase and sale of such Property
         pursuant to this Lease; and, all pension, retirement, bonuses,
         severance pay, salaries and all other compensation and benefits of
         whatsoever nature (including all liabilities to any person under ERISA
         and all liabilities to any governmental body) attributable to service
         to or employment by Landlord prior to the Commencement Date;

                (5)  any labor organization claiming it had any right to
         represent any employees of Landlord who are employed by Tenant
         subsequent to the Commencement Date, where such claims for
         representation arise out of circumstances existing prior to the
         Commencement Date;

                (6)  any losses or costs of defending against any claims which
         may be made against Tenant by any person claiming violations of any
         local, state, or federal laws relating to the employment relationship,
         including, but not limited to, wages, hours, concerted activity,
         nondiscrimination, occupational health and safety and the payment and
         withholding of taxes, where such claims arise out of circumstances
         occurring prior to the Commencement Date; and

                 (7)  any matters as to which Landlord indemnifies Tenant or
         Tenant Indemnitees under other express provisions of this Lease or any
         Operative Document, such indemnity provisions being incorporated in
         this Section 22.01(A) by reference thereto.

         (B)     Subject to Section 22.01(C) hereof, Tenant shall indemnify and
hold Landlord and Landlord's partners, affiliates, employees, and agents
("Landlord Indemnitees") harmless from, any and all Damages resulting from or
  --------------------
arising out of:

                  (1) any breach of any representation or warranty of Tenant
         contained in this Lease or in any Operative Document;

                  (2) any breach or non-performance, partial or total, by Tenant
         of any covenant or agreement of Tenant contained in this Lease or in
         any Operative Document; and

                  (3) any actual or threatened violation of or non-compliance
         with, or remedial, removal or reclamation obligation arising under, any
         Environmental Laws arising from any event, condition, circumstance,
         activity, practice, incident, action or plan existing or occurring in
         connection with Tenant's ownership, management or use of the Premises
         and Equipment after the Commencement Date and the presence of all
         underground or above ground storage tanks or any Materials of
         Environmental Concern on, in, under or affecting all or any portion of
         the Premises and Equipment, or any surrounding areas, and any release
         or threatened release of any Materials of Environmental Concern after
         the Commencement Date; and the storage, disposal or treatment, or
         transportation for storage, disposal or treatment, of, Materials of
         Environmental Concern) after the Commencement Date; other than any and
         all matters for which Tenant and Tenant Indemnitees are indemnified by
         Landlord under the provisions of this Lease or any Operative Document.

         (C) Landlord shall retain liability, and Landlord shall jointly and
severally indemnify Tenant and Tenant Indemnitees, for the payment of any tax
liabilities with respect to the Premises and Equipment and the conduct of the
business during all periods other than during the term of this Lease.

SECTION 22.02 NOTICE AND PARTICIPATION. If a claim by a third party is made
against a party indemnified pursuant to this Article 22 ("Indemnitee"), and if
                                                          ----------
such Indemnitee intends to seek indemnity with respect thereto under this
Article 22, the Indemnitee shall promptly, after the assertion of any claim or
the discovery of any fact upon which Indemnitee intends to base a claim for
indemnification under this Lease ("Claim"), notify the party or parties from
                                   -----
whom indemnification is sought ("Indemnitor") of such Claim. In the event of any
                                 ----------
Claim, Indemnitor, at its option, may assume (with legal counsel acceptable to
the Indemnitee) the defense of any claim, demand, lawsuit or other proceeding in
connection with the Indemnitee's Claim, and may assert any defense of Indemnitee

                                      14
<PAGE>

or Indemnitor; provided that Indemnitee shall have the right at its own expense
               --------
to participate jointly with Indemnitor in the defense of any claim, demand,
lawsuit or other proceeding in connection with the Indemnitee's Claim and
provided further that failure to give such notice shall not preclude Indemnitee
making any Claim thereon if the failure or delay in giving such notice did not
prejudice Indemnitor. In the event that Indemnitor elects to undertake the
defense of any Claim hereunder, Indemnitee shall cooperate with Indemnitor to
the fullest extent possible in regard to all matters relating to the Claim
(including, without limitation, corrective actions required by applicable law,
assertion of defenses and the determination, mitigation, negotiation and
settlement of all amounts, costs, actions, penalties, damages and the like
related thereto) so as to permit Indemnitor's management of same with regard to
the amount of Damages payable by the Indemnitor hereunder. Neither Tenant nor
Landlord shall be entitled to settle any Claim without the prior written consent
of the other, which consent shall not unreasonably be withheld.

SECTION 22.03 INDEMNIFICATION OF NEGLIGENCE OF INDEMNITEE. The indemnification
provided in this Article 22 shall be applicable whether or not negligence of the
Indemnitee is alleged or proven.

SECTION 22.04 REIMBURSEMENT. In the event that the Indemnitor shall, in
accordance with the provisions of Section 22.02 above, undertake, conduct or
control the defense or settlement of any Claim and it is later determined that
such Claim was not a Claim for which the Indemnitor is required to indemnify the
Indemnitee under this Article 22, the Indemnitee shall reimburse the Indemnitor
for all reasonable costs and expenses with respect to such settlement or
defense, including reasonable attorneys' fees and disbursements, incurred prior
to discovery that such Claim was not a Claim for which Indemnitor was required
to indemnify Indemnitee under this Article 22.

SECTION 22.05 OFFSET.    Any Tenant Indemnitee shall have the right to offset
any amounts for which it or any other Tenant Indemnitee is entitled to
indemnification under this Article 22 against any amounts payable by any Tenant
Indemnitee pursuant to any Operative Document or otherwise.

SECTION 22.06 NO THIRD PARTY BENEFICIARIES. The foregoing indemnification is
given solely for the purpose of protecting the parties to this Lease and the
Tenant Indemnitees and Landlord Indemnitees and shall not be deemed extended to,
or interpreted in a manner to confer any benefit, right or cause of action upon,
any other person.

                                  ARTICLE 23

                              CONDITIONS TO LEASE

         Subject to Section 2.2 herein, this Lease is conditioned upon the
satisfactory completion of each of the following (collectively the
"Conditions"):

                  (i)   That each of the Liens to be released (as set forth on
         Exhibit J attached hereto and made a part hereof) be released of
         record, or Tenant otherwise be satisfied, in its sole discretion, that
         such lien releases are imminent;

                  (ii)  Tenant shall obtain from the Title Company a Leasehold
         Policy of Title Insurance in form and substance satisfactory to Tenant,
         subject only to the Permitted Exceptions;

                  (iii) Landlord furnish to Tenant such evidence as Tenant may
         require as to the cancellation and termination of the Scheduled
         Contracts set forth on Exhibit H attached hereto and made a part hereof
         and that all parties in possession of the Premises shall have vacated
         the same; and

                  (iv)  All arrangements for the transfer of the existing liquor
         license currently in the name of Landlord to Tenant shall have been
         satisfied and such liquor license shall have been issued in the name of
         Tenant, or Tenant is otherwise satisfied in its sole discretion that
         such issuance is imminent. Tenant shall be responsible for arranging
         for the transfer of the liquor license and Landlord covenants and
         agrees to use its best efforts to cooperate and assist Tenant in that
         regard.

         In the event that each of the foregoing Conditions are not satisfied or
waived prior to March 31, 2001, Tenant's Rent shall abate until such time as the
Conditions are satisfied.

                                  ARTICLE 24

                             PURCHASE OF INVENTORY

         Contemporaneously with the Commencement Date, Tenant, shall purchase
all existing fuel and non-fuel inventory, from Landlord, except for any
inventory which is stale, or for which the date of use has expired, or which is
unuseable. The cost of any inventory so purchased shall be based upon the last
invoice cost which shall be provided from Landlord to Tenant. Landlord and
Tenant agree to execute such bills of sale, transfers and assignments with
regards to the inventory purchase as may be reasonably requested by either
party, and settlement of the inventory purchase shall be made promptly upon
determination of the last invoice cost with respect thereto.

                                  ARTICLE 25

                           MISCELLANEOUS PROVISIONS

SECTION 25.01: NOTICES. Notices hereunder shall be by certified mail, return
receipt requested, by facsimile transmission, or by overnight delivery service
(e.g., Federal Express) and addressed, as follows:

if to Tenant to:    Petro Stopping Centers, L.P.
                    6080 Surety Drive
                    El Paso, Texas 79905
                    Attn: Legal Department
                    Phone No. (915) 774-4711
                    Fax No.   (915) 774-7366

                                      15
<PAGE>

with a copy to:        Gibson, Dunn & Crutcher, LLP
                       333 South Grand Avenue
                       Los Angeles, California  90071-3197
                       Attn:  Amy R. Forbes, Esq.
                       Fax No. (213) 229-7520

if to Landlord:        San Luis Partnership
                       5570 Sanchez #230
                       San Jose, California  95123
                       Attn:  Dennis Bridgeman
                       Phone No. (408) 978-2221
                       Fax No. (408) 978-5610

                                      16
<PAGE>

or to such other address or addresses as either party may give to the other,
from time to time, by notice as herein provided. Notice shall be deemed given
two (2) days after deposit in the United States mail if sent certified mail,
next day delivery if by overnight courier service and upon telecopy confirmation
if by facsimile transmission. Notice of a change in the identity or address of
any person to whom notice of any type is to be given or payment of any monies is
to be made, shall be effective only thirty (30) days after receipt.

SECTION 25.02: WAIVER. Any failure by either Landlord or Tenant to enforce any
of the provisions of this Lease shall not be deemed a waiver of any of
Landlord's or Tenant's rights or remedies.

SECTION 25.03: CHANGES-MODIFICATIONS. This Lease contains the entire agreement
between the parties hereto as to the subject matters hereof. No modifications,
alterations, changes, waiver or estoppel to this Lease or any of the terms
hereof shall be valid or binding unless in writing and signed by a duly
authorized officer of the party to be charged.

SECTION 25.04: END OF TERM. Upon the expiration or termination of this Lease,
Tenant shall surrender possession of the Premises in general working order and
condition, except for wear and tear, damage by fire, the elements, or casualty,
and except for such damages or conditions not solely and directly caused by the
gross negligence of Tenant.

SECTION 25.05: TENANT'S PROPERTY. All trade fixtures, furniture, furnishings,
equipment and other personalty owned or installed by Tenant before or during the
term hereof shall remain Tenant's property, and Tenant, at any time and from
time to time, including but not limited to the expiration or termination of this
Lease, may, but shall not be obligated to remove same.

SECTION 25.06: HOLDOVER. Should Tenant holdover after the expiration of the
term, such holding over shall be deemed a tenancy from month-to-month subject to
the provisions, conditions and covenants in this Lease contained, and such
tenancy may be terminated upon one (1) month's notice in writing by either party
to the other.

SECTION 25.07: RIGHTS AND REMEDIES. The various rights and remedies of Landlord
and Tenant reserved herein shall be deemed to be cumulative, and, unless
otherwise expressed herein to the contrary, no one of them shall be deemed to be
exclusive of any of the other rights, or remedies as are now permitted, or may
be hereafter allowed either by law or in equity.

SECTION 25.08: SUCCESSORS AND ASSIGNS. The covenants, agreements and obligations
herein contained, except as herein otherwise specifically provided, shall extend
to, bind and inure to the benefit of the parties hereto and their respective
personal representatives, heirs, successors, and assigns.

SECTION 25.09: INVALIDITY OF ANY PROVISIONS. If any term or provision of this
Lease shall, to any extent, be held invalid or unenforceable, the remainder of
this Lease shall not be affected thereby, and each term and provision of this
Lease shall continue to be valid and be enforced to the fullest extent permitted
by law.

SECTION 25.10: CHOICE OF LAW. This Lease shall be governed by and construed in
accordance with the laws of the State of California (other than the choice of
law principles thereof). Venue of any action shall be in the Superior Court of
California, County of Merced.

SECTION 25.11:  MISCELLANEOUS.

      (A)    Whenever the words "Landlord" and "Tenant" appear herein, each
shall be applicable to one or more persons, as the case may be, the singular
shall include the plural, and the neuter to include the masculine and feminine,
and if there shall be more than one, the obligations hereunder shall be joint
and several.

      (B)    Wherever in this Lease reference is made to the "term hereof", the
same shall be deemed to read "as extended" so as to include the period of
extensions if Tenant shall exercise its option(s) to extend.

      (C)    The parties hereto agree that the law of the state in which the
Premises are located will apply to any interpretation of any of the covenants
and provisions of this Lease. The identity of the draftsperson of this Lease, be
it Landlord or Tenant, shall not affect the interpretation of this Lease.

      (D)    The headings used for the various Articles herein contained are for
convenient references only, and are not intended to define, construe or in any
manner limit the contents of such Articles.

      (E)    This Lease may be executed in multiple counterpart copies, each of
which shall be deemed an original and all of which when taken together shall
constitute one in the same agreement.

      IN WITNESS WHEREOF, Landlord and Tenant have executed this Lease Agreement
as of the day, month and year first above stated.

                                    LANDLORD:

                                    SAN LUIS PARTNERSHIP, a California general
                                    partnership

                                    By:
                                       -----------------------------------------
                                             Robert Houret, General Partner

                                    By:
                                       -----------------------------------------
                                             Frank Maestri, General Partner

                                    By:
                                       -----------------------------------------
                                             Frank Andre, General Partner

                                      17
<PAGE>

                                     TENANT:

                                     PETRO STOPPING CENTERS, L.P., a
                                     Delaware limited partnership

                                     By:
                                        ----------------------------------------
                                             Evan Brudahl, Senior Vice
                                             President - Operations

                                      18

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