Document:

THE WARRANT REPRESENTED BY THIS CERTIFICATE (AND THE SECURITIES ISSUABLE UPON EXERCISE HEREOF) HAS NOT BEEN REGISTERED UNDER T

AMENDED AND RESTATED

SERIES B WARRANT PURCHASE AGREEMENT

THE WARRANT REPRESENTED BY THIS CERTIFICATE (AND THE SECURITIES ISSUABLE UPON EXERCISE HEREOF) HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), AND MAY NOT BE SOLD, ASSIGNED, TRANSFERRED OR OTHERWISE DISPOSED OF, AND THE WARRANT MAY NOT BE EXERCISED, EXCEPT IN COMPLIANCE WITH THE REQUIREMENTS OF, OR AN EXEMPTION UNDER, SUCH ACT.

WARRANT TO PURCHASE FIVE

SHARES OF COMMON STOCK OF

PROBE MANUFACTURING, INC.

This certifies that, for value received, __________________ or its registered assigns (“Holder”), is entitled to purchase from Probe Manufacturing, Inc., a Nevada corporation (the “Company”), 5 shares fully paid and non-assessable shares of the Company’s Common Stock (the “Warrant Shares”) for cash at a price of $3.00 per share,  for every unit that they purchased in the Company’s Private Placement Memorandum (the “Stock Purchase Price”), at any time or from time to time up to and including 5:00 p.m. (Pacific time) on May 15, 2007 (the “Expiration Date”), upon surrender to the Company at its principal offices at 3050 Pullman Street, Costa Mesa, CA 92626 (or at such other location as the Company may advise Holder in writing) of this Warrant properly endorsed with the Notice of Exercise attached hereto duly filled in and signed and, except as provided in Section 2 below, upon payment in cash or by check or wire transfer of the aggregate Stock Purchase Price for the number of Warrant Shares for which this Warrant is being exercised determined in accordance with the provisions hereof.  The Stock Purchase Price and the number of Warrant Shares are subject to adjustment as provided in Section 4 below.  

This Warrant is subject to the following terms and conditions:

1.  EXERCISE; ISSUANCE OF CERTIFICATES; PAYMENT FOR SALES

The Company agrees that the Warrant Shares purchased under this Warrant will be and are deemed to be issued to Holder as the record owner of such shares as of the close of business on the date on which this Warrant will have been surrendered and payment made for such shares.  Certificates for the Warrant Shares so purchased, together with any other securities or property to which Holder is entitled upon such exercise, will be delivered to Holder by the Company at the Company’s expense within five business days after the rights represented by this Warrant have been so exercised.  In case of a purchase of less than all the Warrant Shares, the Company will cancel this Warrant and execute and deliver a new Warrant of like tenor for the balance of the Warrant Shares purchasable under the Warrant surrendered upon such purchase to Holder within a reasonable time.  Each stock certificate so delivered will be in such denominations of the Company’s Common Stock as may be requested by Holder and will be registered in the name of Holder.

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2.  NET EXERCISE RIGHT

2.1

Right to Net Exercise.  In addition to, and without limiting, the other rights of Holder hereunder, Holder will have the right (the “Net Exercise Right”) to exercise this Warrant in part or in total into Warrant Shares as follows at any time during the term hereof.  Upon exercise of the Net Exercise Right, the Company will deliver to Holder, without payment by Holder of any Stock Purchase Price or any cash or other consideration, that number of Warrant Shares computed using the following formula:

X=Y (A-B)

A

Where:

X=

The number of Warrant Shares to be issued to Holder

Y=

The number of Warrant Shares purchasable pursuant to this Warrant

A=

The Fair Market Value of one Warrant Share as of the Exercise Date

B=

The Stock Purchase Price

2.2

Method of Exercise.  The Net Exercise Right may be exercised by Holder by the surrender of this Warrant to the Company at its principal office, together with a written notice specifying that Holder intends to exercise the Net Exercise Right and indicating the number of Warrant Shares to be acquired upon exercise of the Net Exercise Right.  Such exercise will be effective upon the Company’s receipt of this Warrant, together with the exercise notice, or on such later date as is specified in the exercise notice (the “Exercise Date”) and, at Holder’s election, may be made contingent upon the closing of the Company’s initial public offering of any securities pursuant to a registration statement under the Securities Act of 1933, as amended (the “Securities Act”).  Certificates for the Warrant Shares so acquired will be delivered to Holder immediately upon the Exercise Date.  If applicable, the Company will, upon surrender of this Warrant for cancellation, deliver a new Warrant evidencing the rights of Holder to purchase the balance of the Warrant Shares which Holder is entitled to purchase hereunder. 

2.3

Fair Market Value.  The “Fair Market Value” of a Warrant Share as of a particular date means:  

(a)  if conversion of the Warrant Shares is effective as of the closing of the Company’s initial public offering of any securities pursuant to a registration statement under the Securities Act, the “price to public” specified for such shares in the final prospectus for such public offering; 

(b)  if the shares of the Company’s Common Stock are traded on a national securities exchange or quoted on the National Association of Securities Dealers National Market System, the average of the closing prices for such shares for the five trading days immediately prior to the Exercise Date; however, if the shares of the Company’s Common Stock are traded in another over-the-counter market, then the average of the mean between the bid and asked prices for such five trading days; and 

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(c)  otherwise, the price as determined in good faith by the Board of Directors of the Company.

2.4

Automatic Exercise.  Notwithstanding the foregoing, if the aggregate value of the cash, stock or other property that Holder would have received if Holder had exercised this Warrant immediately prior to the closing of an Acquisition (as defined below) or an Asset Transfer (as defined below) exceeds the aggregate Stock Purchase Price of the Warrant Shares, then this Warrant shall automatically be deemed exercised, with no notice required by Holder and in lieu of the cash exercise provided for in this Warrant, on a Net Issuance Exercise basis as described in Section 2.1 above.  For purposes of this Section 2.4, the value of such stock or other property will be deemed its fair market value as determined in good faith by the Board of Directors of the Company. As used herein, “Acquisition” shall mean any consolidation or merger of the Company with or into any other corporation or other entity or person, or any other corporate reorganization, in which the stockholders of the Company immediately prior to such consolidation, merger or reorganization, own less than 50% of the Company’s voting power immediately after such consolidation, merger or reorganization, or any transaction or series of related transactions to which the Company is a party in which in excess of fifty percent (50%) of the Company’s voting power is transferred, excluding any consolidation or merger effected exclusively to change the domicile of the Company.  As used herein, “Asset Transfer” shall mean a sale, lease or other disposition of all or substantially all of the assets of the Company.

3.  SHARES TO BE FULLY PAID; RESERVATION OF SHARES

The Company covenants and agrees that all Warrant Shares that may be issued upon the exercise of the rights represented by this Warrant will, upon issuance, be duly authorized, validly issued, fully paid and nonassessable and free from all preemptive rights of any stockholder and free of all taxes, liens and charges with respect to the issue thereof.  The Company further covenants and agrees that, during the period within which the rights represented by this Warrant may be exercised, the Company will at all times have authorized and reserved, for the purpose of issue or transfer upon exercise or conversion of the subscription rights evidenced by this Warrant, a sufficient number of shares of the Company’s authorized but unissued Common Stock, or other securities and property, when and as required to provide for the exercise or conversion of the rights represented by this Warrant.  The Company will take all such action as may be necessary to assure that such shares of the Company’s Common Stock may be issued as provided herein without violation of any applicable law or regulation, or of any requirements of any domestic securities exchange upon which the stock may be listed.  The Company will not take any action which would result in any adjustment of the Stock Purchase Price (as defined in Section 4 hereof) if the total number of shares of the Company’s Common Stock issuable after such action upon exercise or conversion of all outstanding warrants, together with all shares then outstanding and all shares then issuable upon exercise of all options and upon the conversion of all convertible securities then outstanding, would exceed the total number of shares of the Company’s Common Stock then authorized by the Company’s Articles of Incorporation.

4.  ADJUSTMENT OF STOCK PURCHASE PRICE AND NUMBER OF SHARES

The Stock Purchase Price and the number of shares purchasable upon the exercise or conversion of this Warrant will be subject to adjustment from time to time upon the occurrence of certain events described in this Section 4. 

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4.1

Subdivision or Combination of Stock.  If the Company at any time subdivides the outstanding shares of the Company’s Common Stock into a greater number of shares, the Stock Purchase Price in effect immediately prior to such subdivision will be proportionately reduced; and conversely, if the Company at any time combines the outstanding shares of the Company’s Common Stock into a smaller number of shares, the Stock Purchase Price in effect immediately prior to such combination will be proportionately increased.  Upon each adjustment of the Stock Purchase Price, Holder will thereafter be entitled to purchase, at the Stock Purchase Price resulting from such adjustment, the number of Warrant Shares obtained by multiplying the Stock Purchase Price in effect immediately prior to such adjustment by the number of Warrant Shares purchasable pursuant hereto immediately prior to such adjustment, and dividing the product thereof by the Stock Purchase Price resulting from such adjustment.

4.2

Dividends In Stock, Other Stock Property, Reclassification.  If at any time or from time to time the holders of the Company’s Common Stock (or any shares of stock or other securities at the time receivable upon the exercise of this Warrant) receive or become entitled to receive, without payment therefor:

(a)  any shares of the Company’s Common Stock or any shares of stock or other securities which are at any time directly or indirectly convertible into or exchangeable for Common Stock, or any rights or options to subscribe for, purchase or otherwise acquire any of the foregoing by way of dividend or other distribution;

(b)  any cash paid or payable otherwise than as a regular periodic cash dividend at a rate which is substantially consistent with past practice (or, in the case of an initial dividend, at a rate which is substantially consistent with industry practice); or

(c)  any Common Stock or other or additional stock or other securities or property (including cash) by way of spin-off, split up, reclassification, combination of shares or similar corporate rearrangement; (other than shares of the Company’s Common Stock issued as a stock split, adjustments in respect of which will be covered by the terms of subsection 4.1 above), then and in each such case, Holder will, upon the exercise or conversion of this Warrant, be entitled to receive, in addition to the number of Warrant Shares receivable thereupon, and without payment of any additional consideration thereof, the amount of stock and other securities and property (including cash in the cases referred to this Section 4.2 which Holder would hold on the date of such exercise or conversion had he or it been the holder of record of such Common Stock as of the date on which holders of the Company’s Common Stock received or became entitled to receive such shares and/or all other additional stock and other securities and property.

4.3

Organic Change.  Any recapitalization, reorganization, reclassification, consolidation, merger, sale of all or substantially all of the Company's assets or other transaction, in each case which is effected in such a way that the holders of Common Stock are entitled to receive (either directly or upon subsequent liquidation) equity securities or assets with respect to or in exchange for Common Stock, is referred to herein as an “Organic Change.”  Prior to the consummation of any Organic Change, the Company shall make appropriate provision (in form and substance satisfactory to Holder) to insure that Holder shall thereafter have the right to acquire and receive, in lieu of or in addition to (as the case may be) the shares of Common Stock immediately theretofore acquirable and receivable upon the exercise of this Warrant, such shares, securities or assets as may be issued or payable with respect to or in exchange for the number of shares of Common Stock immediately theretofore acquirable and receivable upon exercise of this 

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Warrant had such Organic Change not taken place.  In any such case, the Company shall make appropriate provision (in form and substance satisfactory to Holder) with respect to Holder’s rights and interests to insure that the provisions of this Section 4 and Section 3 hereof shall thereafter be applicable to the Warrant (including, in the case of any such consolidation, merger or sale in which the successor entity or purchasing entity is other than the Company, an immediate adjustment of the Stock Purchase Price to the value for the Common Stock reflected by the terms of such consolidation, merger or sale, and a corresponding immediate adjustment in the number of shares of Common Stock acquirable and receivable upon exercise of the Warrant, if the value so reflected is less than the Stock Purchase Price in effect immediately prior to such consolidation, merger or sale).  The Company shall not effect any such consolidation, merger or sale, unless prior to the consummation thereof, the successor entity (if other than the Company) resulting from consolidation or merger or the entity purchasing such assets assumes by written instrument (in form and substance satisfactory to Holder), the obligation to deliver to Holder such shares, securities or assets as, in accordance with the foregoing provisions, Holder may be entitled to acquire.

4.4

Other Notices.  If at any time:

(a) The Company will declare any cash dividend upon the Company’s Common Stock;

(b) The Company will declare any dividend upon the Company’s Common Stock payable in stock or make any special dividend or other distribution to the holders of the Company’s Common Stock;

(c) The Company will offer for subscription pro rata to the holders of the Company’s Common Stock any additional shares of stock of any class or other rights;

(d) There will be any capital reorganization or reclassification of the capital stock of the Company, or consolidation or merger of the Company with, or sale of all or substantially all of its assets to, another corporation;

(e) There will be a voluntary or involuntary dissolution, liquidation or winding up of the Company; or

(f) The Company will take or propose to take any other action, notice of which is actually provided to or is required to be provided, pursuant to any written agreement, to holders of the Company’s Common Stock, then, in any one or more of said cases, the Company will give, by first class mail, postage prepaid, addressed to Holder at Holder’s address as shown on the books of the Company, (x) at least 10 days prior written notice of the date on which the books of the Company will close or a record will be taken for such dividends, distribution or subscription rights or for determining rights to vote in respect of any such reorganization, reclassification, consolidation, merger, sale, dissolution, liquidation or winding up, and (y) in the case of any such reorganization, reclassification, consolidation, merger, sale, dissolution, liquidation or winding up, at least 20 days prior written notice of the date when the same will take place.  Any notice given in accordance with the foregoing clause (x) will also specify, in the case of any such dividend, distribution or subscription rights, the date on which the holders of the Company’s Common Stock will be entitled to exchange their stock for securities or other property deliverable upon such reorganization, reclassification, consolidation, merger, sale, dissolution, liquidation or winding up, as the case may be.

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4.5

Certain Events.  If any other event occurs as to which the other provisions of this Section 4 are not strictly applicable or if strictly applicable would not fairly protect the purchase rights of Holder in accordance with the essential intent and principles of such provisions, then the Board of Directors of the Company will make an adjustment in the number and class of shares available under the Warrant, the Stock Purchase Price and/or the application of such provisions, in accordance with such essential intent and principles, so as to protect such purchase rights as aforesaid.  The adjustment will be such as will give Holder upon exercise for the same aggregate Stock Purchase Price the total number, class and kind of shares as Holder would have owned had the Warrant been exercised or converted prior to the event and had he or it continued to hold such shares until after the event requiring adjustment.

5.  ISSUE TAX

The issuance of certificates for shares of the Company’s Common Stock upon the exercise or conversion of this Warrant will be made without charge to Holder for any issue tax in respect thereof; provided, however, that the Company will not be required to pay any tax which may be payable in respect of any transfer involving the issuance and delivery of any certificate in a name other than that of the original Holder of the Warrant being exercised.

6.  CLOSING OF BOOKS

The Company will at no time close its transfer books against the transfer of this Warrant or of any shares of the Company’s Common Stock issued or issuable upon the exercise of this Warrant in any manner which interferes with the timely exercise of this Warrant.

7.  NO VOTING OR DIVIDEND RIGHTS; LIMITATION OF LIABILITY

Nothing contained in this Warrant will be construed as conferring upon Holder the right to vote or to consent or to receive notice as a stockholder in respect of meetings of stockholders for the election of directors of the Company or any other matters or any rights whatsoever as a stockholder of the Company.  No dividends or interest will accrue or be payable in respect of this Warrant or the interest represented hereby or the shares purchasable hereunder until, and only to the extent that, this Warrant has been exercised or converted.  No provisions hereof, in the absence of affirmative action by Holder to purchase shares of the Company’s Common Stock, and no mere enumeration herein of the rights or privileges of Holder, will give rise to any liability of Holder for the Stock Purchase Price or as a stockholder of the Company, whether such liability is asserted by the Company or by its creditors.

8.  EXPIRATION

This Warrant will expire at 5:00 PM on the fifth anniversary of the date hereof.

9.

REGISTRATION RIGHTS

Company shall at its own expense, register all warrants issued under this Agreement in the next registration statement filed by the Company.

10.  WARRANTS TRANSFERABLE

Subject to the provisions of the Agreement, this Warrant and all rights hereunder are transferable, in whole or in part, without charge to Holder (except for transfer taxes), upon 

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surrender of this Warrant properly endorsed (by Holder executing the Assignment Form annexed hereto).  Each Holder of this Warrant, by taking or holding the same, consents and agrees that this Warrant, when endorsed in blank, will be deemed negotiable, and that the holder hereof, when this Warrant will have been so endorsed, may be treated by the Company and all other persons dealing with this Warrant as the absolute owner hereof for any purpose and as transferee hereof on the books of the Company, any notice to the contrary notwithstanding; but, until such transfer on such books, the Company may treat the registered Holder hereof as the Holder hereof for all purposes.

11.  MODIFICATION AND WAIVER

This Warrant and any provision hereof may be amended, waived or modified upon written consent of the Company and Holder.

12.  NOTICES

Any notice or other communication required or permitted to be given or made under this Agreement: (i) will be in writing, (ii) will be delivered by hand delivery, U.S. Mail (certified or registered), Federal Express, UPS, Overnight, Airborne, or other nationally recognized delivery service, fax, or e-mail or other means of electronic transmission, and (iii) will be addressed as follows:

To Holder at:

________________

________________

________________

________________

________________

To the Company at:

Probe Manufacturing, Inc.

3050 Pullman St.

Costa Mesa, CA  92626

Attn: Reza Zarif

Fax:  714-424-2972

Email:  rzarif@probemi.com

or to such other address as such Person may designate by 10 days advance notice to the other parties hereto.

Absent fraud or manifest error, a receipt signed by the addressee or such addressee’s authorized representative, a certified or registered mail receipt, a signed delivery service confirmation or a fax or e-mail confirmation of transmission will constitute proof of delivery.  Any notice actually received by the addressee will constitute delivery notwithstanding the failure to comply with any provisions of this subsection.

A notice delivered by regular or certified U.S. Mail will be deemed to have been delivered on the third business day after such notice’s post-mark.  Any other notice will be deemed to have been received on the date and time of the signed receipt or confirmation of delivery or transmission thereof, unless that receipt or confirmation date and time is not a business day or is after 5:00 p.m. local time on a business day, in which case such notice will be deemed to have been received on the next succeeding business day.

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13.  GOVERNING LAW

This Warrant will be governed by and construed under the laws of the State of California as applied to agreements among California residents entered into and to be performed entirely within California (other than conflict of law rules which might result in the application of the laws of any other jurisdiction).

14.  LOST WARRANTS OR STOCK CERTIFICATES

The Company represents and warrants to Holder that upon receipt of evidence reasonably satisfactory to the Company of the loss, theft, destruction, or mutilation of this Warrant or any stock certificate and, in the case of any such loss, theft or destruction, upon receipt of an indemnity reasonably satisfactory to the Company, or in the case of any such mutilation upon surrender and cancellation of this Warrant or any stock certificate, the Company at its expense will make and deliver a new Warrant or stock certificate, of like tenor, in lieu of the lost, stolen, destroyed or mutilated Warrant or stock certificate.

15.  FRACTIONAL SHARES

No fractional shares will be issued upon exercise of this Warrant.  The Company will, in lieu of issuing any fractional share, pay the Holder entitled to such fraction a sum in cash equal to such fraction multiplied by the then effective Stock Purchase Price.

16.  RIGHTS AND OBLIGATIONS SURVIVE EXERCISE OF WARRANT

The rights and obligations of the Company, of Holder and of the holder of any shares of stock issued upon exercise of this Warrant, shall survive the exercise of this Warrant.

17.  BINDING EFFECT ON SUCCESSORS

This Warrant shall be binding upon any corporation succeeding the Company by merger, consolidation or acquisition of all or substantially all of the Company’s assets.  All of the obligations of the Company relating to the Common Stock issuable upon the exercise of this Warrant shall survive the exercise and termination of this Warrant.  All of the covenants and agreements of the Company shall inure to the benefit of the successors and assigns of the holder hereof. 

IN WITNESS WHEREOF, the Company has caused this Warrant to be duly executed by its duly authorized officers, effective as of __________ __, 2005.

Probe Manufacturing, Inc.

A Nevada Corporation

By: __________________________________

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Name: ________________________________

Title: _________________________________

9

NOTICE OF EXERCISE

(To be signed only upon exercise of Warrant)

To:

PROBE MANUFACTURING, INC.

The undersigned, Holder of the attached Warrant, hereby irrevocably elects to exercise the purchase right represented by the Warrant as follows:

[  ]

The undersigned elects to purchase for cash or check _______ full shares of Common Stock of Probe Manufacturing, Inc. and herewith makes payment of $_________ for those shares;

[  ]

The undersigned elects to effect a net exercise of the Warrant, exercising the Warrant [ ] in full or [ ] as to the following gross number of shares: _______________. 

The undersigned requests that the certificates for the shares be issued in the name of, and delivered to, __________________________________, whose address is ______________ ____________________________.

[The undersigned further requests that a new Warrant for the unexercised portion of the attached Warrant be issued in the name of, and delivered to, ________________________, whose address is _______________________________________.]

Dated: _________________

(Signature must conform in all respects to name of Holder as specified on the face of the attached Warrant.)

Signature

Address

ASSIGNMENT FORM

FOR VALUE RECEIVED, the undersigned registered owner of this Warrant hereby sells, assigns, and transfers unto the Assignee named below all of the rights of the undersigned under the within Warrant with respect to the number of shares of Common Stock set forth below:

Name of Assignee:

Address:

No. of Shares:

and does hereby irrevocably constitute and appoint _________, attorney-in-fact, to make such transfer on the books of Probe Manufacturing, Inc., maintained for that purpose, with full power of substitution in the premises.

Dated:______________________________________________________

Signature of Holder: ___________________________________________Exhibit 10.1

                               333 CORPORATE PLAZA

1.    Basic Lease Provisions & Definitions ("Basic Lease Provisions").
      ---------------------------------------------------------------

1.1 Parties.  This Lease,  dated November 1, 2005, is between 333 Ventures,  LLC
("Landlord") and Capital Bank Corporation ("Tenant").

1.2 Premises. As defined in Exhibit A.
                            ---------

Additionally,  Landlord will provide  Tenant with 3,314 square feet of vault and
adjoining  space in the  basement of the Building at a cost of $4.00 per foot to
the Tenant (the "Vault").

1.3 Building.  The real property  located at 333 Fayetteville  Street,  Raleigh,
County of Wake,  State of North Carolina (the  "Building"),  including  adjacent
parking structures used in connection therewith.

1.4 Use. General office,  retail banking, and other financial services,  subject
to Paragraph 6.

1.5 Term. The Commencement Date shall be April 01, 2006. The original term under
this Lease shall begin on the  Commencement  Date and will continue for a period
of one hundred and twenty (120) full months until midnight,  March 31, 2016 (the
"Termination Date").

1.6 Base Rent.  Tenant  base rent shall be based on an  initial  rental  rate of
$18.75 per rentable square foot,  resulting in Tenant paying the monthly amounts
in Paragraph  1.8.  Rent payment is due and payable in advance on the 1st day of
each month per Paragraph 4.1.

1.7 Base Allowance. The (per square foot) dollar amount that results by dividing
the sum of the annual  Operating  Expenses (as defined in Paragraph 4.2) for the
Building (144,711 rentable sq. ft.) by the rentable square footage of the leased
building area. The Tenant's Base Year shall be 2006. Throughout the term of this
lease, the Base Year Operating Expenses are included in the Base Rent.

1.8 Base  Rent  Increase.  The Base  Rent for the  rental  space  payable  under
Paragraph 1.6 shall increase every April 1st at a rate of Three Percent (3%) per
year during the Term of the Lease,  resulting  in the  following  rent rates per
rentable square foot per year and Monthly rents:

<TABLE>
<CAPTION>

Period                                   Premises         Rate/rsf    RSF    Monthly rent      Total $
------                                   --------         --------    ---    ------------      -------
<S>                                    <C>                <C>        <C>      <C>            <C>
April 1, 2006 thru October 31, 2006:   Initial space       $18.75    25,907   $40,479.69     283,357.81

Nov. 1, 2006 thru March 31, 2007:      2nd Floor added     $18.75    33,449   $52,264.06     261,320.31

April 1, 2007 thru June 30, 2007:      --                  $19.31    33,449   $53,825.02     161,475.04

                                       5
<PAGE>

July 1, 2007 thru Dec. 31, 2007:       6th Floor added     $19.31    44,404   $71,453.44     428,720.61

Jan. 1, 2008 thru March 31, 2008:      7th Floor added     $19.31    55,359   $89,081.85     267,245.57

April 1, 2008 thru March 31, 2009:     --                  $19.89    55,359   $91,757.54   1,101,090.48

April 1, 2009 thru March 31, 2010:     --                  $20.49    55,359   $94,525.49   1,134,305.91

April 1, 2010 thru March 31, 2011:     --                  $21.10    55,359   $97,339.58   1,168,074.90

April 1, 2011 thru March 31, 2012:     --                  $21.74    55,359   $100,292.06  1,203,504.66

April 1, 2012 thru March 31, 2013:     --                  $22.39    55,359   $103,290.67  1,239,488.01

April 1, 2013 thru March 31, 2014:     --                  $23.06    55,359   $106,381.55  1,276,578.54

April 1, 2014 thru March 31, 2015:     --                  $23.75    55,359   $109,564.69  1,314,776.25

April 1, 2015 thru March 31, 2016:     --                  $24.46    55,359   $112,840.10  1,354,081.14

April 1, 2006 thru March 31, 2016              Vault area rental $4.585*   3,314       --    151,946.90
                                                                                             ----------

                                                          TOTAL RENTAL PAYMENTS   $11,345,966.13
</TABLE>

*$4.585 is a 10-year average based on $4.00 initial rate and 3% escalation

In the event Tenant  chooses to take  occupancy of any portion or all of the 6th
or 7thFloors  prior to the Occupancy Date specified above and in Exhibit A, then
the base lease rate of the area  occupied  shall be $12.75 per  rentable  square
foot until the Occupancy  Date specified  above and in Exhibit A is reached,  at
which time the lease rate changes to the rate specified  above.  The Base Rental
Increase in Paragraph 1.8 shall apply to the $12.75 per rentable  square footage
rate, based on a beginning Base Rate term rate term effective April 1, 2006.

1.9 Rent Adjustments.  Beginning on the Commencement  Date, the Tenant shall pay
Landlord the Base Rent as described herein. In the event the first day following
the Commencement  Date shall occur on a day other than the first day of a month,
Tenant shall be liable for the pro rata  portion of Base Rent for the  remainder
of the month in which  Base  Rent  first  becomes  due.  In the  event  that the
Commencement  Date  occurs  between the 15th day of the month and the end of the
month, then the pro rata rent will be based on the 1st Month rate, the following
month  will also be at the 1st Month  rate,  the next  month  will be at the 2nd
Month rate, etc.

1.10  Security  Deposit.  Tenant is not required to provide  Landlord a security
deposit.

1.11 Tenant's Share of Operating  Expense  Increase.  Varies as Tenant occupancy
increases under this lease,  but will initially be 17.90 %  (25,907/144,711)  as
defined in Paragraph 4.2. At 33,449 rsf it will be 23.11%, at 44,404 rsf it will
be 30.68 and at 55,359 rsf it will be 38.25.

1.12 Foregone Rent. N/A

1.13 Parking.  Landlord shall make available  eleven (11) secured,  individually
assigned,  executive or customer  parking spaces in the adjacent Hudson Building
(or beneath the 333 Building, depending upon Tenant preference). The cost, which
varies from  $125/space  per month  beneath the 333 Building to  $110/space  per
month beneath the Hudson  Building,  will be passed on to the Tenant without any
markup. Landlord shall use commercially reasonable

                                       6
<PAGE>

efforts  to make  available  two or three  short-term  customer  parking  spaces
beneath the 333 Building.  Tenant shall  reimburse  Landlord for the  reasonable
cost of converting existing parking spaces into suitable customer parking,  Upon
Tenant request,  Landlord shall use commercially  reasonable  efforts to procure
all other  parking  spaces needed by Tenant and pass on the actual direct costs,
without  mark-up,  to the  Tenant  for  payment in the  Tenant's  monthly  lease
invoice.  Landlord shall seek spaces in the adjacent Raleigh  Convention  Center
Deck  (adjoining the Progress  Energy  Corporate  Office),  which has 2005 rates
varying from $55.00/ space per month on the top,  un-covered  level to $80/space
per month on the lower covered levels. Tenant understands that the City reserves
the right to move the  assigned  spaces and to change the rate.  The most likely
alternate for space relocation would be the Moore's Square Deck.

1.14 Listing Broker.  Landlord  acknowledges that Raleigh Commercial Realty, LLC
serves as a listing broker with regard to the building.

1.15 Cooperating  Broker.  Tenant acknowledges that Thomas Linderman Graham Inc.
is  the  exclusive  cooperating  broker   (Representative)  for  the  Tenant.  A
"cooperating  broker" is defined as any  broker  other than the  Listing  Broker
entitled  to a share of any  commission  arising  under this  Lease.  A separate
commission  Agreement has been negotiated  between Thomas  Linderman Graham Inc.
and Raleigh Commercial Realty, LLC.

1.16 ERISA  Party.  Landlord  is not an  employee  benefit  plan as that term is
defined in Paragraph 3(3) of the Employee Retirement Income Security Act of 1974
("ERISA"),  or a trust  formed to hold  assets  of one or more such  plans or an
entity owned by such a plan or trust (each of which is referred to in this Lease
as an "ERISA  Party").  Paragraph 48 of this Lease shall apply if Landlord is an
ERISA Party.  Paragraph  12.13 of this Lease shall apply if Landlord is an ERISA
Party or if an ERISA Party subsequently becomes Landlord.

1.17 Landlord  Alterations,  Improvements or Additions.  Landlord will be making
alterations  improvements or additions to the Premises in conjunction  with this
lease.  Paragraph 7.5(a) shall apply if Landlord will not be making alterations,
improvements  or  additions  to the  Premises  in  conjunction  with this Lease.
Paragraph 7.5(b) shall apply if Landlord will be making alterations improvements
or additions to the Premises in conjunction with this Lease.

1.18 Moving expenses. Tenant is responsible for all moving expenses.

2.    Premises, Parking and Common Areas.
      ----------------------------------

2.1 Premises.  The  Premises,  the  Building,  the Common  Areas,  as defined in
Paragraph  2.3, the land upon which the same are  located,  along with all other
buildings  and  improvements  thereon or  thereunder,  are  herein  collectively
referred to as the "Building". Landlord hereby leases the Premises to Tenant and
Tenant leases the Premises  from Landlord for the term, at the rental,  and upon
all of the conditions set forth herein,  including rights to the Common Areas as
herein specified.

2.2 Vehicle Parking. Intentionally Omitted.

2.3 Common Areas  -Definition.  The term "Common  Areas" is defined as all areas
and facilities outside the Premises and within the exterior boundary line of the
Building that are provided and  designated by the Landlord from time to time for
the  general  non-exclusive  use of  Landlord,  Tenant and other  lessees of the
Building and their invitees, including, but not limited to, all areas of, common
entrances,   lobbies  (except  certain   portions  of  the  main  lobby  on  the
Fayetteville  Street level, which is a part of the Tenant Premises),  corridors,
stairways and stairwells,  public  restrooms,  elevators  (those  designated for
office tenant use and does not include the exclusive

                                       7
<PAGE>

Tenant  basement  through  3rd floor  elevator),  access  passage  ways from the
elevators  to the  streets,  access  passageways  to the  parking,  loading  and
unloading areas, trash areas, roadways, sidewalks, ramps, driveways,  landscaped
areas and decorative walls. As used in this Lease, the term "invitees" means the
employees,  visitors,  suppliers, shippers and customers of Landlord, Tenant and
other lessees of the Building.

2.4 Common Areas -Rules and  Regulations.  Tenant agrees to abide by and conform
to the rules and  regulations  attached  hereto as Exhibit B with respect to the
                                                   ---------
Building,  and to cause its invitees to so abide and  conform.  Landlord or such
other  person(s) as Landlord may appoint  shall have the  exclusive  control and
management  of the Common Areas and shall have the right,  from time to time, to
modify, amend and enforce said rules and regulations.  Provided,  however,  that
(a) in the event of any  conflict  between  said rules and  regulations  and the
express terms of this Lease,  the Lease terms shall control;  (b) such rules and
regulations do not require payment of additional  monies;  (c) Landlord provides
reasonable  advance written notice  thereof;  and (d) such rules and regulations
are uniformly enforced in a non-discriminatory manner.

2.5 Common  Areas  -Changes.  Provided  that such  actions  do not  unreasonably
interfere with the conduct of Tenant's business or Tenant's use and enjoyment of
the  Premises,   Landlord  shall  have  the  right,  in  Landlord's   reasonable
discretion, from time to time:

(a) To make changes to the Building  interior and exterior and the Common Areas,
including, without limitation, changes in the location, size, shape, number, and
appearance  thereof,   including  but  not  limited  to  the  lobbies,  windows,
stairways, air shafts, elevators,  escalators,  restrooms, driveways, entrances,
parking spaces,  parking areas,  loading and unloading areas,  ingress,  egress,
direction of traffic, decorative walls, landscaped areas and walkways; provided,
however,  Landlord shall at all times provide the parking facilities required by
applicable law;

(b) To close  temporarily  any of the Common Areas for  maintenance  purposes so
long as reasonable access to the Premises remains available;

(c) To  designate  other land and  improvements  outside  the  present or future
boundaries of the Building to be a part of the Common Areas,  provided that such
other land and improvements have a reasonable and functional relationship to the
Building;

(d) To add additional buildings and improvements to the Common Areas;

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

(f) To do and perform such other acts and make such other changes in, to or with
respect to the Common  Areas and the other  portions of the Building as Landlord
may, in the exercise of sound business  judgment,  deem to be appropriate,  in a
manner which will not unreasonably interfere with Tenants access.

3.    Term.
      ----

3.1 Term.  The Term and  projected  Commencement  Date of this Lease shall be as
specified in Paragraph 1.5 of the Basic Lease Provisions.

3.2 Delay in Possession.  Notwithstanding  said  Commencement  Date in Paragraph
1.5, if the Premises are not ready for Tenant's  business  occupancy  due to the
unreasonable  actions or omissions of Landlord,  Landlord's  agents,  employees,
and/or contractors  ("Landlord  Delays") and subject to Paragraph 3.2.2,  Tenant
shall be  entitled  to an  abatement  of Rent for the  period  of time  directly
attributable to Landlord Delays (and the

                                       8
<PAGE>

Commencement  Date  and  all  dates  in the  rent  schedule  shall  be  adjusted
accordingly).  Landlord shall also be responsible for all damages  incurred (due
to the delay) directly attributable to Landlord Delays.

3.2.1 Possession  Tendered;  Defined.  During the Lease Term,  possession of the
Premises shall be deemed tendered to Tenant  ("Tender of  Possession")  when (1)
the  improvements  to be provided by Landlord or provided by Tenant based on the
Tenant Improvement allowance under this Lease are substantially  completed (with
a  Certificate  of Occupancy  issued by the City of  Raleigh),  (2) the Building
utilities  are ready for use in the  Premises,  and (3)  Tenant  has  reasonable
access to the Premises.

3.2.2  Delays  Caused  by  Tenant.  There  shall be no  abatement  of Rent  upon
completion items (1), (2) and (3) of Paragraph 3.2.1 to the extent of any delays
proximately  attributable  to the  unreasonable  acts or  omissions  of  Tenant,
Tenant's agents, employees and contractors.

3.3 Early  Possession.  If Tenant  occupies the  Premises for business  purposes
(i.e.,  the operation of financial  services) prior to said  Commencement  Date,
such  occupancy  shall be  subject to all the  provisions  of this  Lease,  such
occupancy shall not change the  termination  date, and Tenant shall pay Rent for
such occupancy;  provided, however, Landlord hereby agrees to allow Tenant early
occupancy of the lobby area without  payment of Rent. In such event,  Tenant and
Landlord shall execute an amendment to this Lease  establishing  the date of the
actual  taking  of  possession  by  Tenant as the  Commencement  Date.  Any work
performed by Tenant or a Tenant  contractor for items in preparation of business
occupancy, such as  telephone/workstations,  or for the Tenant Improvements,  if
Tenant  Improvements  are  contracted  directly  with  the  Tenant,   shall  not
constitute taking occupancy for the purposes of this Paragraph.

4.    Rent.
      ----

4.1 Base Rent.  Subject to adjustment as provided in Paragraph 4.3 and except as
may be otherwise expressly provided in this Lease, Tenant shall pay Landlord the
Base Rent set forth in  Paragraph  1.8 of the Basic  Lease  Provisions,  without
offset or  deduction.  Rent for any  period  during the term less than one month
shall be prorated  based upon the actual  number of days of the  calendar  month
involved. Rent shall be payable in lawful money of the United States to Landlord
at the address stated herein or to such other persons or at such other places as
Landlord may designate in writing.

4.2 Operating Expense Increase. Tenant shall pay to Landlord, during the term of
this Lease,  Tenant's  Share, as defined in Paragraph  4.2(a),  of all estimated
increases  (on a per square foot basis) in  Operating  Expenses,  adjusted on an
annual  basis,  as defined in Paragraph  4.2(b),  above the Base  Allowance,  as
defined in  Paragraph  1.7.  Payments  of  Tenant's  Share in excess of the Base
Allowance  are due and  payable  monthly  on the  same  date as the  Base  Rent.
Tenant's  Share of the  increase  may be adjusted by Landlord on an annual basis
should the actual Operating Expenses exceed the then current  estimates.  Within
ninety (90) days after the  expiration of each  calendar  year,  Landlord  shall
provide Tenant with a reasonably  detailed statement showing the actual increase
or decrease in Operating Expenses over the Base Allowance for the prior year. If
payments made by Tenant  pursuant to this  Paragraph are less than or exceed the
amounts shown in any statement then Tenant's account will be adjusted to reflect
the amounts  due. All  deficiencies  are payable upon receipt of invoice and all
credits will be applied by Landlord to the next installment of Operating Expense
reimbursement. Concurrently, with the remittance of the prior year statement, or
as soon  thereafter as is reasonably  possible,  Landlord shall advise Tenant of
the then current  year's  estimate of Operating  Expenses as well as the monthly
payment due thereon.  Any  deficiencies  in the monthly  billings  that may have
accrued from either the  commencement  date of the Lease or the first day of any
subsequent  calendar  year shall be due and payable upon receipt by Tenant of an
invoice from Landlord.

(a)  "Tenant's  Share" is defined as the  product  derived  by  multiplying  the
percentage  set forth in  Paragraph  1.11 by the then current  year's  Operating
Expenses less the square foot Base Allowance multiplied by the total

                                       9
<PAGE>

rentable  square footage of the Building.  The percentage set forth in Paragraph
1.11 is  calculated by dividing the rentable  square  footage of the Premises by
the total rentable  square footage of the Building.  It is understood and agreed
that the square  footage  figures are  approximations  that  Landlord and Tenant
agree are reasonable  and shall not be subject to revision  except in connection
with an  actual  change  in the size of the  Premises  or a change  in the space
available  for lease in the  Building.  Notwithstanding  any  provision  of this
Paragraph  to the  contrary,  if the  Building  is less than  ninety-five  (95%)
percent leased as of the last day of any calendar quarter,  an adjustment may be
made in Tenant's  Share for such quarter to reflect at least  ninety-five  (95%)
percent of the rentable  area of the Building as being  leased.  The formula for
such computation  shall be a ratio, the numerator of which is Tenant's  rentable
square footage as stated in Paragraph 1.2 of the Basic Lease  Provisions and the
denominator of which is the total  rentable  square footage of the Building less
five percent (5%).

(b) "Operating  Expense(s)" is defined to include all costs incurred by Landlord
in the exercise of its  reasonable  discretion  and shall be in accordance  with
Generally Accepted Accounting Practices (GAAP) for:

(i) The operation, repair, maintenance, and replacement, in a neat, clean, safe,
good order and  condition,  of the  Building,  including but not limited to, the
following:

(aa) The Common Areas,  including their surfaces,  coverings,  decorative items,
carpets,  drapes and window coverings,  and including parking areas, loading and
unloading  areas,  trash  areas,  roadways,   sidewalks,   walkways,  stairways,
parkways,  driveways,  landscaped areas, striping,  bumpers, irrigation systems,
lighting facilities, building exteriors and roofs, fences and gates;

(bb) All heating, air conditioning,  plumbing,  electrical systems,  life safety
equipment,   telecommunications  equipment,  elevators  and  escalators,  lessee
directories,  fire detection systems, sprinkler systems and other equipment used
in common by, or for the benefit of, occupants of the Building;

(ii) Trash disposal, janitorial, security services, window cleaning;

(iii) Any other  service to be provided by Landlord  that is  elsewhere  in this
Lease stated to be an "Operating Expense";

(iv) Premiums for the liability and property insurance policies (including,  but
not  limited  to,  earthquake,  flood and boiler  and  machinery  insurance,  if
carried} maintained by Landlord;

(v) Real property taxes payable by Landlord under Paragraph 10.1;

(vi) Water, sewer, gas, electricity, and other publicly mandated services to the
Building;

(vii) Wages, salaries, other costs of all on-site and off-site employees engaged
either full or  part-time in the  operation,  management  maintenance  or access
control of project,  and applicable fringe benefits and materials,  supplies and
tools, used in maintaining and cleaning the Building;

(viii) Maintaining and auditing  accounting records and a management fee (not to
exceed  five  percent  (5%) of  rental)  attributable  to the  operation  of the
Building;

(ix)  Replacing   and/or  adding  any  repairs  or  removals   mandated  by  any
governmental agency,  provided such repairs or removals are first required after
the Commencement Date.;

(x) Replacing equipment or improvements that have a useful life for depreciation
purposes of five (5) years or less, as determined in the reasonable  judgment of
Landlord's  accountant,  amortized  over such life  (including  interest  on the
un-amortized balance as reasonably determined by Landlord's accountant), and;

(xi)  Replacing  and/or adding any equipment,  device or capital  improvement to
reduce operation or maintenance expenses with respect to the Building, amortized
over its useful life as determined in the reasonable judgment

                                       10
<PAGE>

of  Landlord's  accountant  (including  interest on the  unamortized  balance as
reasonably determined by Landlord's accountant).

(c) [Intentionally Deleted]

(d)  Notwithstanding  the foregoing,  the following shall not be included in the
calculation  of  Operating  Expenses:  (i)  costs  of  alterations  of  tenants'
premises;  (ii) costs of capital  improvements and costs of curing  construction
defects; (iii) depreciation;  (iv) interest and principal payments on mortgages,
and other debt costs; (v) any cost or expenditure (or portion thereof) for which
Landlord is reimbursed, whether by insurance proceeds or otherwise; (vi) cost of
any service  furnished to any other occupant of the Building which Landlord does
not   provide  to  Tenant   hereunder;   (vii)   leasing   commissions,   costs,
disbursements, and other expenses incurred for leasing, renovating, or improving
space for tenants;  (viii) costs  incurred  because  Landlord or another  tenant
violated the terms of any lease;  (ix) profit paid to subsidiaries or affiliates
of  Landlord  for  management  or other  services  (other  than as  provided  in
Paragraph  4.2(b)(vii)  above) on or to the  property  or for  supplies or other
materials,  to the extent that the cost of the services,  supplies, or materials
exceed the competitive costs of the services,  supplies,  or materials were they
not provided by a subsidiary  or  affiliate;  (x)  compensation  paid to clerks,
attendants,  or other  persons in commercial  concessions  operated by Landlord;
(xi) repairs or other work needed because of fire, wind storm, or other casualty
or cause insured against by Landlord or to the extent  insurance  required under
the Lease would have  provided  insurance,  whichever  is the greater  coverage;
(xii) costs  incurred in  operating  the parking  facilities  for the  Building,
except to the extent the cost of operating  the parking  facilities  exceeds the
revenue  generated  from  operating the parking  facilities  (in which case such
unrecouped costs shall be included in Operating Expenses);  (xiii) non-recurring
costs incurred to remedy structural defects in original  construction  materials
or installations;  (xiv) expenses paid directly by a tenant for any reason; (xv)
greater than five percent (5%) annual  increase in management fees or employees'
salaries or benefits,  except where Landlord can reasonably  demonstrate through
comparable  market  salaries  or benefits  that are greater  than 5% increase is
consistent with market  conditions,  or both; (xvi) costs exceeding market rates
for  comparable   buildings;   and  (xvii)  other  expenses  that,   under  GAAP
consistently   applied,   would  not  be  considered  customary  and  reasonable
maintenance, repair, management, or operation expenses.

(e)  Notwithstanding  anything  contained  herein to the contrary,  increases in
"controllable  common area  costs" (as  hereinafter  defined)  shall not, in the
aggregate,  exceed  seven  percent  (7%)  annually,  except  where  Landlord can
reasonably  demonstrate  through comparable market costs, that increases greater
than 7% is consistent with market conditions.  "Controllable  common area costs"
shall  mean  the  common  area  costs   relating  to   compensation,   cleaning,
maintenance,  overhead,  contract  services,  grounds  care,  repair  and  other
miscellaneous common area costs for the Building. Controllable common area costs
shall exclude insurance expenses and utility charges.

(f) Upon reasonable  prior written request given not later than thirty (30) days
following the date  Landlord's  bill for Tenant's  Share is delivered to Tenant,
Landlord will provide Tenant reasonably  detailed  documentation to support such
bill  or  provide  Tenant  with  the   opportunity  to  review  such  supporting
information.  If Tenant does not notify  Landlord of any objection to Landlord's
bill within ninety (90) days after the later of delivery of  Landlord's  bill or
such requested supporting documentation, Tenant shall be deemed to have accepted
Landlord's bill as true and correct and shall be deemed to have waived any right
to dispute the Tenant's Share due pursuant to that bill. Any records reviewed by
Tenant  or  its  designees  relating  to  Operating  Expenses  shall  constitute
confidential  information of Landlord and shall not be disclosed to anyone other
than Tenant,  its  accountants or others  engaged in the review.  If such review
reveals that Landlord has overcharged  Tenant,  the amount  overcharged shall be
paid to Tenant within  thirty (30) days after the review is concluded,  together
with interest  thereon at the prevailing  Prime Interest Rate, from the date the
Tenant's payment is received by the Landlord until the payment of the overcharge
is made to the  Tenant.  Additionally,  in the event such  review  reveals  that
Landlord has  overcharged  Tenant by three percent (3%) or more,  Landlord shall
also pay to Tenant the  reasonable  costs of such review.  Any disputes over the
results of such review shall be settled pursuant to Paragraph 52 of this Lease.

                                       11
<PAGE>

(g)  Operating   Expenses   shall  not  include   replacement  of  equipment  or
improvements  having a useful life in excess of five (5) years as  determined in
the  reasonable  judgment  of  Landlord's  accountant  unless  they are the type
described  in Paragraph  4.2(b) (ix) or (xi),  in which case their cost shall be
included as above provided.

4.3 Base Rent Increase.

4.3.1 N/A

4.3.2  Definition of Rent. The capitalized  term "Rent",  as used in this Lease,
shall mean the Base Rent.

5.    Security Deposit.. [Intentionally Deleted]
      ----------------

6.    Use.
      ---

6.1 Use. The Premises  shall be used and occupied only for the purpose set forth
in Paragraph 1.4 of the Basic Lease Provisions and for no other purpose, without
Landlord's consent, not to be unreasonably  withheld,  conditioned,  or delayed.
Landlord represents and warrants, to the best of its knowledge,  that applicable
laws, codes,  ordinances,  covenants and restrictions  permit the Premises to be
used for the purpose set forth in Paragraph  1.4 of the Basic Lease  provisions.
Landlord  agrees not to lease any  portion of the  Building  to a thrift,  bank,
credit union,  or any other similar  financial  services  company or institution
that offers services similar to those offered by the Tenant.

6.2 Compliance with Legal  Requirements.  Landlord warrants that (to the best of
its  knowledge  and except  for the Tenant  Improvements  to be  constructed  by
Tenant),  on the  Commencement  Date, the Building and Premises will comply with
all  applicable  laws,  ordinances,   rules,  and  regulations  of  governmental
authorities ("Applicable Laws"). During the Term, Landlord shall comply with all
Applicable Laws regarding the Premises and Building, except to the extent Tenant
must comply under  Paragraphs 6.1 and 6.2.  Except as to  pre-existing  defects,
violations or  conditions,  Tenant shall comply with all  Applicable  Laws:  (i)
regarding  the physical  condition of the  Premises,  but only to the extent the
Applicable  Laws  pertain  to the  particular  manner in which  Tenant  uses the
Premises; (ii) related to its construction of the Tenant Improvements;  or (iii)
that do not relate to the  physical  condition of the Premises but relate to the
lawful use of the Premises and with which only the occupant can comply,  such as
laws  governing  maximum  occupancy,  workplace  smoking,  and illegal  business
operations, such as gambling.

6.3 Condition of Premises.

(a) Upon delivery of  possession  to Tenant the Premises  shall be clean and the
plumbing, electrical, air conditioning, and heating system in the Premises shall
be in good operating condition. Tenant shall promptly notify Landlord in writing
of  any  claimed  violation  of  the  foregoing  warranty,  setting  forth  with
reasonable  specificity  the nature of the violation.  If it is determined  that
there  has  been  a  violation  (not   proximately   attributable   to  Tenant's
construction of the Tenant Improvements),  Landlord shall promptly after receipt
of such notice from Tenant, at Landlord's sole cost, rectify such violation.

(b) Except as  otherwise  provided  in this  Lease,  Tenant  hereby  accepts the
Premises and the Building prior to its  construction of the Tenant  Improvements
in their "as is"  condition  as of the date of  delivery  of  possession  of the
Premises to Tenant,  except for: (i) latent defects not readily apparent through
visual inspection,  (ii) the replacement of window film by Landlord on floors 3,
4, 6 and 7 prior to Tenant Occupancy and (iii) possible removal by Landlord,  in
its  discretion,  of any window  blinds on the 3rd and 4th  floors  and  further
subject to all

                                       12
<PAGE>

applicable  municipal,   county  and  state  laws,  ordinances  and  regulations
governing and regulating the use of the Premises,  and any easements,  covenants
or restrictions of record,  and Tenant accepts this Lease subject thereto and to
all  matters   disclosed   thereby  and  by  any   exhibits   attached   hereto.
Notwithstanding the foregoing,  Tenant acknowledges and agrees that Tenant shall
be responsible for legal  requirements  associated with its  construction of the
Tenant Improvements. Tenant acknowledges that it has satisfied itself by its own
independent  investigation  that the Premises are suitable for its intended use,
and that, except as specifically provided herein, neither Landlord nor any agent
of Landlord has made any  representation or warranty as to the present or future
suitability  of the  Premises,  Common  Areas,  or  Building  for the conduct of
Tenant's business.

7.    Maintenance, Repairs, Alterations and Additions.
      -----------------------------------------------

7.1 Maintenance and Repair -Landlord's Obligations.  Landlord shall maintain the
Common  Areas  of the  Building  and the  plumbing,  heating,  ventilating,  air
conditioning,  elevator, electrical and other mechanical systems of the Building
in good working order.

7.2 Maintenance and Repair-Tenant's Obligations.  During the term of this Lease,
Tenant shall take good care of the  Premises  and fixtures  therein and maintain
them in as good order, condition and repair as received, ordinary and reasonable
wear and tear and  insured  casualty  excepted.  During the term of this  Lease,
Tenant shall maintain at its own expense any plumbing  facilities located within
the Premises  serving only the  Premises,  except the rest rooms  located in the
core of the  Building,  in good order,  condition  and repair to the  reasonable
satisfaction  of Landlord.  Upon  surrender of the Premises to Landlord,  Tenant
shall deliver the Premises to Landlord, broom clean, in as good order, condition
and repair as they were upon  delivery of  possession  to Tenant,  ordinary  and
reasonable wear and tear,  approved  alterations and insured casualty  excepted.
Without  limiting the  foregoing,  Landlord may  require,  upon advance  written
notice,  that such repairs and  maintenance  be performed by  Landlord-appointed
contractors/workers (to maintain quality of services),  all at Tenant's expense,
provided that such expenses are customary and reasonable for the work performed.

7.3 Alterations and Additions.

(a)  Tenant  shall not,  without  Landlord's  prior  written  consent,  make any
alterations,  improvements  or  additions  in, on or about the  Premises  or the
Building,  which consent shall not be  unreasonably  withheld,  conditioned,  or
delayed by the Landlord. At the expiration of the term, Landlord may require the
removal of any or all of said  alterations,  improvements  or additions  and the
restoration  of the  Premises  and the  Building  to their prior  condition,  at
Tenant's  expense.  Should  Landlord  permit  Tenant  to make  any  alterations,
improvements or additions,  Tenant shall use only contractors expressly approved
by Landlord.  Tenant shall cause any mechanics' or materialmen's lien (placed on
the Building by Tenant's  contractors) to be discharged within five (5) business
days after  receipt of written  notice  thereof.  Such  contractors  shall carry
liability  insurance of a type and in such reasonable  amounts as Landlord shall
reasonably require,  naming Landlord and Tenant as additional  insureds.  Before
commencing the work, such contractors  shall furnish Landlord with  certificates
of insurance  evidencing  such coverage.  Tenant shall also maintain a policy of
Builder's Risk for such work.  Should Tenant make any alterations,  improvements
or additions  without the prior  approval of Landlord,  or use a contractor  not
expressly  approved by  Landlord,  Landlord  may, at any time during the term of
this Lease, require that Tenant remove any part or all of such work.

(b) Tenant shall present any alteration, improvement or addition in or about the
Premises  or the  Building  that  Tenant  desires to make to Landlord in written
form, with proposed  detailed plans.  If Landlord  consents to such  alteration,
improvement  or addition,  the consent shall be deemed  conditioned  upon Tenant
acquiring a permit to do so from the applicable government agencies,  furnishing
a copy thereof to Landlord prior to the commencement of the work, and compliance
by Tenant with all conditions of said permit in a prompt and

                                       13
<PAGE>

expeditious  manner.  Landlord shall take  commercially  reasonable  measures to
cooperate with Tenant in obtaining any such permit.

(c) Tenant shall pay,  when due, all claims for labor or materials  furnished or
alleged to have been  furnished to or for Tenant at or for use in the  Premises,
which  claims are or may be  secured by any  mechanic's  or  materialman's  lien
against the Premises, the Building or the Building, or any interest therein.

(d) Tenant shall give  Landlord not less than ten (10) days' notice prior to the
commencement  of any work in the  Premises  by Tenant.  Landlord  shall have the
right  to  post  notices  of  non-responsibility  in or on the  Premises  or the
Building.  If Tenant, in good faith, contests the validity of any lien, claim or
demand regarding the work, then Tenant shall, at its sole expense, defend itself
and Landlord and  Landlord's  agents  against the same and shall pay and satisfy
any adverse judgment that may be rendered thereon before the enforcement thereof
against  Landlord or  Landlord's  agents or the  Premises or the Building or the
Building,  upon the  condition  that if Landlord  shall  require,  Tenant  shall
furnish to Landlord a surety bond satisfactory to Landlord in an amount equal to
such contested lien claim or demand indemnifying  Landlord and Landlord's agents
against  liability for the same and holding the  Premises,  the Building and the
Building free from the effect of such lien or claim.

(e) All alterations,  improvements and additions made by Tenant shall be done in
a good,  workmanlike  manner with good quality materials and, upon installation,
shall become the property of Landlord  and remain upon and be  surrendered  with
the  Premises at the  expiration  of the Lease term,  unless  Landlord  requires
removal pursuant to Paragraph 7.3(a).  Any trade fixtures installed and paid for
by Tenant may be  removed  by Tenant  during the term of this Lease and shall be
removed at the  expiration  of the term.  Tenant  shall in all  events  promptly
repair any damage caused by removal of trade fixtures.

(f) Tenant shall provide Landlord with as-built plans and specifications for any
alterations, improvements or additions.

7.4 Utility Additions.  Landlord reserves the right to install new or additional
utility  facilities  throughout  the  Building  for the  benefit of  Landlord or
Tenant,  or any other  lessee of the  Building,  including  but not  limited to,
plumbing,  electrical systems,  communication  systems,  and fire protection and
detection systems,  so long as such installations do not unreasonably  interfere
with Tenant's use of the Premises.

7.5 Americans with Disabilities  Act.  Landlord  represents that, to the best of
its knowledge, the Building complies with or will comply with the Americans with
Disabilities  Act (the" Act").  Tenant shall be responsible  for compliance with
the Act in its construction of the Tenant  Improvements and the failure to do so
shall,  at the option of  Landlord,  constitute  an event of default  under this
Lease.

7.6 Tenant  Improvements.  Landlord shall provide a Tenant Improvements (TI), or
"Up-fits", allowance in accordance to Exhibit C.

8.    Insurance - Indemnity.  [NOTE:  Review with  insurance  broker or internal
      ---------------------    ----
      personnel.]

8.1 Liability  Insurance-Tenant.  Tenant shall, at Tenant's expense,  obtain and
keep in force  during  the Term of this  Lease a policy  of  Commercial  General
Liability  Insurance in an amount of not less than  $1,000,000 per occurrence of
bodily  injury  and  property  damage   combined.   Compliance  with  the  above
requirement shall not, however, limit the liability of Tenant hereunder.

8.2 Liability Insurance -Landlord. Landlord shall, at Landlord's expense, obtain
and keep in force during the Term of this Lease a policy of  Commercial  General
Liability  Insurance in an amount of not less than  $1,000,000 per occurrence of
bodily  injury  and  property  damage   combined.   Compliance  with  the  above
requirement shall not, however, limit the liability of Landlord hereunder.

                                       14
<PAGE>

8.3  Property  and  Business  Interruption  Insurance  -Tenant.   [Intentionally
                                                                   -------------
Deleted.]
-------

8.4 Property Insurance -Landlord. Landlord shall obtain and keep in force during
the term of this Lease a policy or policies of insurance covering loss or damage
to the Building  improvements,  but not Tenant's  personal  property,  fixtures,
equipment  or tenant  improvements,  in an amount no less than full  replacement
cost providing  protection against all perils included within the classification
of fire, extended coverage, vandalism, malicious mischief, plate glass, and such
other perils as Landlord deems advisable from time to time or may be required by
a lender  having a lien on the  Office  Building.  Such  insurance  may  include
earthquake,  flood and boiler and machinery insurance. In addition, Landlord may
obtain and keep in force, during the term of this Lease, rental value insurance,
with loss payable to Landlord, which insurance may also cover Operating Expenses
(but such  insurance  will not be passed  to  Tenant as an  Operating  Expense).
Tenant will not be named in any such policies carried by Landlord and shall have
no right to any proceeds therefrom.  The policies required by Paragraphs 8.2 and
8.4 shall  contain  such  deductibles  as Landlord or the  aforesaid  lender may
determine. Tenant shall not do or permit to be done anything (other than for the
use  specified  in  Paragraph  1.4 of the Basic  Lease  provisions)  which shall
invalidate  the  insurance  policies  carried by Landlord.  Tenant shall pay the
increase in the property  insurance  premium for the Building if the increase is
specified by  Landlord's  insurance  carrier as being  caused by the  particular
nature of Tenant's occupancy or any act or omission of Tenant.

8.5 Insurance Policies. Tenant shall deliver to Landlord certificates evidencing
the  existence  and amounts of such  insurance  within  seven (7) days after the
Commencement  Date of this Lease.  The policies or  certificates  must include a
copy of the endorsement naming the additional  insureds required under Paragraph
8.1.  Tenant  shall,  at least thirty (30) days prior to the  expiration of each
policy,  furnish Landlord with a copy of the policy or a certificate  evidencing
the renewal thereof.  If Tenant provides a certificate  Landlord may at any time
thereafter  require  Tenant to provide  Landlord with a copy of the policy.  The
policies shall be issued by insurers having a rating of A+10 or better in Best's
Key Rating Guide, who are admitted  carriers in the State of North Carolina.  No
such policy  shall be  cancelable  or subject to  reduction of coverage or other
modification  except  after thirty (30) days prior  written  notice to Landlord.
Landlord  shall  deliver to Tenant  certificates  evidencing  the  existence and
amounts of such insurance within seven (7) days after the Commencement Date.

8.6 Waiver of  Subrogation.  Tenant and Landlord each hereby release and relieve
the other and waive their entire right of recovery against the other, for direct
or consequential loss or damage arising out of or incident to the perils covered
by property  insurance  carried by such party,  whether due to the negligence of
Landlord or Tenant or their  agents,  employees,  contractors  or  invitees.  If
necessary,  all property  insurance  policies required under this Lease shall be
endorsed to so provide.

8.7  Indemnity.  Each  party  (an  "Indemnifying  Party")  shall,  in an  amount
proportionate to such Indemnifying  Party's culpability,  indemnify,  defend and
hold  harmless  the other party (an  "Indemnified  Party")  and the  Indemnified
Party's agents,  partners,  shareholders,  directors,  officers,  employees, and
lenders, if any, from and against any and all claims for damage to the person or
property of anyone or any entity  arising from the  Indemnifying  Party's use or
operation of the Building,  or from the conduct of Indemnifying Party's business
or from any activity, work or things done, permitted or suffered by Indemnifying
Party in or about the Premises or elsewhere and shall further indemnify,  defend
and hold harmless  Indemnified Party from and against any and all claims,  costs
and  expenses  arising  from any  breach or default  in the  performance  of any
obligation on the  Indemnifying  Party's part to be performed under the terms of
this Lease, or arising from any act or omission of Indemnifying Party, or any of
Indemnifying Party's agents,  contractors,  employees, or invitees, and from and
against  all costs,  attorneys'  fees,  expenses  and  liabilities  incurred  by
Indemnified Party as the result of any such use, conduct, activity, work, things
done,  permitted  or suffered,  breach,  default or  negligence,  and in dealing
reasonably therewith, including but not limited to the defense or pursuit of any
claim or any action or proceeding  involved  therein;  and in case any action or
proceedings  be  brought  against  an  Indemnified  Party by  reason of any such
matter,  the Indemnifying  Party upon notice from Indemnified Party shall defend
the same at the Indemnifying Party's expense by counsel reasonably  satisfactory
to Indemnified Party and the Indemnified

                                       15
<PAGE>

Party  shall  cooperate  with  the  Indemnifying  Party  in  such  defense.  The
Indemnified  Party  need not have  first  paid any such  claim in order to be so
indemnified.  The  provisions of this Paragraph 8.7 shall survive the expiration
or termination of this Lease.

8.8  Exemption of Landlord  from  Liability.  Tenant hereby agrees that Landlord
shall not be liable for injury  ("Tenant  Damages") to Tenant's  business or any
loss of income thereof or for loss of or damage to the goods, wares, merchandise
or other property of Tenant,  Tenant's employees,  invitees,  customers,  or any
other person in or about the  Premises or the  Building,  nor shall  Landlord be
liable  for  injury  to the  person of  Tenant,  Tenant's  employees,  agents or
contractors,  whether  such damage or injury is caused by or results from theft,
fire,  steam,  electricity,  gas, water or rain, or from the breakage,  leakage,
obstruction or other defects of pipes, sprinklers, wires, appliances,  plumbing,
air  conditioning or lighting  fixtures,  or from any other cause,  whether said
damage or injury results from conditions arising upon the Premises or upon other
portions  of  the  Building,  or  from  other  source  or  place,  or  from  new
construction  or the  repair,  alteration  or  improvement  of any  part  of the
Building, or of the equipment, fixtures or appurtenances applicable thereto, and
regardless  of  whether  the  cause of such  damage  or  injury  or the means of
repairing the same is inaccessible. Landlord shall not be liable for any damages
arising  from any act or neglect of any other  tenant,  occupant  or user of the
Building. Notwithstanding the foregoing, the Landlord shall indemnify Tenant for
Tenant  Damages  resulting  from  Landlord's  gross  negligence  or  intentional
misconduct,  but only in an  amount  proportionate  to  Landlord's  culpability.
[NOTE: Need to confirm insurance will cover even with this liability waiver.]
 ----

8.9  No   Representation   of  Adequate   Coverage.   Neither  party  makes  any
representation  that the limits or forms of coverage of  insurance  specified in
this Paragraph 8 are adequate to cover any party's property or obligations under
this Lease.

9.    Damage or Destruction.
      ---------------------

9.1 Definitions.

(a) "Premises  Damage" shall mean damage or  destruction  of the Premises to any
extent.

(b) "Premises  Building  Partial Damage" shall mean damage or destruction of the
Building to the extent that the cost to repair is less than fifty  percent (50%)
of the then Replacement Cost of the Building.

(c) "Premises  Building Total  Destruction"  shall mean damage or destruction of
the  Building  to the extent that the cost to repair is fifty  percent  (50%) or
more of the then Replacement Cost of the Building.

(d)  "Building  Total  Destruction"  shall  mean  damage or  destruction  of the
buildings in the Building to the extent that the cost of repair is fifty percent
(50%)  or more of the  then  Replacement  Cost  of all of the  buildings  in the
Building.

(e) "Insured Loss" shall mean damage or destruction  caused by an event required
to be  covered  by the  insurance  described  in  Paragraph  8. The fact that an
Insured Loss has a deductible amount shall not make the loss an uninsured loss.

(f)  "Replacement  Cost" shall mean the amount of money necessary to be spent to
repair or rebuild the damaged area to the  condition  that  existed  immediately
prior to the damage occurring, excluding all improvements made by tenants of the
Building.

                                       16
<PAGE>

9.2 Premises Damage; Premises Building Partial Damage.

(a) Insured Loss: Subject to the provisions of Paragraphs 9.4 and 9.5, if at any
time during the term of this Lease there is an Insured  Loss and that falls into
the  classification  of either  Premises  Damage or  Premises  Building  Partial
Damage,  and that does not fall into the  classification  of  Premises  Building
Total Destruction or Building Total Destruction, then Landlord shall, as soon as
reasonably  possible  and to the extent  the  required  materials  and labor are
readily  available  through usual commercial  channels,  at Landlord's  expense,
repair such damage (but not Tenant's fixtures,  equipment or tenant improvements
originally  paid for entirely by Tenant,  except that Landlord shall restore the
Tenant  Improvements) to its condition  existing at the time of the damage,  and
this Lease  shall  continue in full force and effect;  provided,  however,  that
Tenant  shall  have the right to  terminate  this  Lease (by  written  notice to
Landlord) if Landlord  does not restore the Premises  within one hundred  eighty
(180) days.

(b) Uninsured  Loss:  Subject to the provisions of Paragraphs 9.4 and 9.5, if at
any time  during the term of this Lease  there is damage  that is not an Insured
Loss and that falls  into the  classification  of  Premises  Damage or  Premises
Building  Partial  Damage,  and that  does not fall into the  classification  of
Premises Building Total Destruction or Building Total Destruction, unless caused
by a negligent  or willful act of Tenant (in which event  Tenant  shall make the
repairs  at  Tenant's  expense)  , which  damage  prevents  Tenant  from  making
substantial  use of the Premises,  Landlord may at Landlord's  option either (i)
repair such damage as soon as  reasonably  possible at  Landlord's  expense,  in
which  event this Lease shall  continue  in full force and effect,  or (ii) give
written  notice  to  Tenant  within  thirty  (30)  days  after  the  date of the
occurrence of such damage of Landlord's  intention to cancel and terminate  this
Lease as of the date of the occurrence of such damage, in which event this Lease
shall  terminate  as of the date of the  occurrence  of such  damage;  provided,
however,  that Tenant shall have the right to  terminate  this Lease (by written
notice to Landlord) if Landlord does not restore the Premises within one hundred
eighty (180) days.

9.3 Premises Building Total Destruction;  Building Total Destruction. Subject to
the provisions of Paragraphs 9.4 and 9.5, if at any time during the term of this
Lease there is damage,  whether or not it is an Insured Loss, that falls into I'
the  classification of either (i) Premises Building Total  Destruction,  or (ii)
Building  Total  Destruction,  then Landlord may at Landlord's  option either 0)
repair such damage or destruction  as soon as reasonably  possible at Landlord's
expense (to the extent the  required  materials  are readily  available  through
usual commercial  channels) to its condition existing at the time of the damage,
but not  Tenant's  fixtures,  equipment or tenant  improvements,  and this Lease
shall  continue in full force and effect,  or (ii) give written notice to Tenant
within  thirty  (30)  days  after  the  date of  occurrence  of such  damage  of
Landlord's  intention  to cancel and  terminate  this Lease,  in which case this
Lease shall terminate as of the date of the occurrence of such damage; provided,
however,  that Tenant shall have the right to  terminate  this Lease (by written
notice to Landlord) if Landlord does not restore the Premises within one hundred
eighty (180) days.

9.4 Damage Near End of Term.

(a)  Subject to  Paragraph  9.4(b),  if at any time  during the last twelve (12)
months of the term of this Lease there is Premises Damage  resulting in Tenant's
loss-of-use  of more than  fifty  percent  (50%) of the  Premises  for more than
thirty (30) days,  Landlord or Tenant may, at its option,  cancel and  terminate
this Lease as of the date of occurrence of such damage by giving  written notice
to the other party of its  election  to do so within  thirty (30) days after the
date of occurrence of such damage.

(b) In the event  that  Tenant  has an option to extend or renew this Lease that
has not expired,  Tenant shall exercise such option, if it is to be exercised at
all, no later than twenty (20) days after the occurrence  during the last twelve
(12)  months of the term of an Insured  Loss that falls into the  classification
Premises  Damage.  If Tenant duly  exercises such option during said twenty (20)
day period,  the provisions of Paragraph 9.4(a) shall

                                       17
<PAGE>

not apply.  If Tenant fails to exercise  such option during said twenty (20) day
period,  then Landlord may at Landlord's  option terminate and cancel this Lease
as of the expiration of said twenty (20) day period, notwithstanding any term or
provision in the grant of option to the contrary.

9.5 Abatement of Rent- Tenant's Remedies.

(a) In the event Landlord repairs or restores the Building or Premises  pursuant
to the  provisions  of this  Paragraph  9, and any part of the  Premises are not
usable (including loss of use due to loss of access or essential services),  the
Rent payable hereunder  (including Tenant's Share of Operating Expense Increase)
for the period during which such damage,  repair or restoration  continues shall
be abated,  provided  (1) the damage  was not the  result of the  negligence  or
willful misconduct of Tenant, and (2) such abatement shall only be to the extent
the  operation  and  profitability  of Tenant's  business  as operated  from the
Premises is  adversely  affected.  Except for said  abatement  of Rent,  if any,
Tenant shall have no claim against Landlord for any damage suffered by reason of
any such damage,  destruction,  repair or  restoration.  Any disputes  regarding
eligibility  for abatement  shall be settled in accordance  with Paragraph 52 of
this Lease.

(b) If Landlord  shall be  obligated  to repair or restore  the  Premises or the
Building  under the  provisions of this  Paragraph 9 and shall not commence such
repair or  restoration  within  ninety  (90) days after such  occurrence,  or if
Landlord  shall not complete the  restoration  and repair  within six (6) months
after such  occurrence,  Tenant may at Tenant's option cancel and terminate this
Lease by giving  Landlord  written  notice of Tenant's  election to do so at any
time prior to the  commencement or completion,  respectively,  of such repair or
restoration.  In such event this Lease  shall  terminate  as of the date of such
notice.

(c) Tenant agrees to take  commercially  reasonable  measures to cooperate  with
Landlord in connection with any such  restoration and repair,  including but not
limited to the approval or execution of plans and specifications if required.

9.6 Termination  -Advance  payments.  Upon termination of this Lease pursuant to
this Paragraph 9, an equitable  adjustment shall be made concerning advance Rent
and any advance payments made by Tenant to Landlord.

10.   Real Property Taxes.
      -------------------

10.1 Payment of Taxes.  Landlord  shall pay the real property tax, as defined in
Paragraph 10.3, applicable to the Building subject to reimbursement by Tenant of
Tenant's Share of such taxes in accordance with the provisions of Paragraph 4.2,
except as otherwise provided in Paragraph 10.2.

10.2  Additional  Improvements.  Tenant shall not be responsible  for paying any
increase in real property tax specified in the tax  assessor's  records and work
sheets as being caused by  additional  improvements  placed upon the Building by
other  lessees or by Landlord for the  exclusive  enjoyment of any other lessee.
Tenant shall,  however,  pay to Landlord at the time that Operating Expenses are
payable under Paragraph 4.2 the entirety of any increase in real property tax if
assessed solely by reason of additional improvements placed upon the Premises by
Tenant or at Tenant's request (as reasonably documented by Landlord).

10.3 Definition of "Real Property Tax". As used herein,  the term "real property
tax" shall include any form of real estate tax or assessment,  general, special,
ordinary  or  extraordinary,   and  any  license  fee,  commercial  rental  tax,
improvement bond or bonds, levy or tax (other than inheritance,  personal income
or estate taxes) imposed on the Building or any portion thereof by any authority
having the direct or indirect power to tax, including any city, county, state or
federal  government,  or  any  school,  agricultural,  sanitary,  fire,  street,

                                       18
<PAGE>

drainage  or  other  improvement  district  thereof,  as  against  any  legal or
equitable  interest of Landlord in the  Building or in any portion  thereof,  as
against  Landlord's  right to rent or other  income  therefrom,  and as  against
Landlord's business of leasing the Building.  The term "real property tax" shall
also include any tax, fee, levy,  assessment or charge (i) in  substitution  of,
partially or totally,  or as a supplement to any tax, fee,  levy,  assessment or
charge  included  within the definition of "real property tax," or (ii) which is
imposed as a result of a change of  ownership,  as defined by  applicable  local
statutes for property tax  purposes,  of the Building or which is added to a tax
or charge  included within the definition or real property tax by reason of such
change of  ownership,  or (iii) which is imposed by reason of this  transaction,
any modifications or changes hereto, or any transfers hereof.

10.4 Joint Assessment.  If the improvements or property, the taxes for which are
to be paid  separately by Tenant under Paragraph 10.2 or 10.5 are not separately
assessed,  Tenant's  portion  of that tax  shall  be  equitably  determined  and
reasonably documented by Landlord from the respective valuations assigned in the
assessor's work sheets or such other information  (which may include the cost of
construction) as may be reasonably available.

10.5 Personal Property Taxes.

(a) Tenant shall pay prior to delinquency all taxes assessed  against and levied
upon trade fixtures,  furnishings,  equipment and all other personal property of
Tenant contained in the Premises or elsewhere.

(b) If any of Tenant's said personal  property shall be assessed with Landlord's
real property, Tenant shall pay to Landlord the taxes attributable to Tenant (as
reasonably  documented  by  Landlord)  within ten (10) days  after  receipt of a
written statement setting forth the taxes applicable to Tenant's property.

11.   Utilities.
      ---------

11.1 Services Provided by Landlord. Landlord shall provide heating, ventilation,
air  conditioning,  and janitorial  service during Operating  Hours,  reasonable
amounts of  electricity  for normal  lighting  and  office  machines,  water for
reasonable and normal  drinking and lavatory use,  replacement of standard light
bulbs and/or  standard  fluorescent  tubes and  ballasts  for standard  overhead
fixtures. Landlord shall provide sufficient ventilation and air conditioning for
office work environment,  exclusive of higher heat sources such as server rooms.
Installation  of a Liebert system or similar  provisions to  accommodate  higher
heat generation from a server room or similar  elevated-heat  sources shall be a
responsibility  of the Tenant.  Standard bulbs for the Building include F40CW or
F40WW in flood or  incandescent  with  standard-threaded  bulbs.  Standard light
fixtures  include 2' x 2' or 2' x 4'  florescent or  standard-threaded  110-volt
recessed  can  lights.  Any  non-standard  bulbs  required  by  Tenant  shall be
purchased by Tenant and installed by Landlord.

11.2 Services  Exclusive to Tenant.  Tenant shall pay for all water,  gas, heat,
light,   power,   telephone  and  other  utilities  and  services  specially  or
exclusively  supplied  or  metered  exclusively  to the  Premises  or to Tenant,
together with any taxes thereon. If any such services are not separately metered
to the  Premises,  Tenant  shall  pay a  reasonable  proportion  determined  and
reasonably  documented  by Landlord of all charges  jointly  metered  with other
areas in the Building.

11.3 Hours of  Service.  Operating  hours for the  Building  are Monday  through
Friday, 7:00 am to 6:00 pm (excepting  holidays) and Saturday 8:00 am to 1:00 pm
("Operating  Hours");  however,  access  to  the  building  with  all  utilities
maintained,  including  heating and air  conditioning,  will be available to the
Tenant 24 hours per day, 7 days per week.  Landlord  reserves  the right to bill
Tenant  at  a  rate  of  Twenty-five  Dollars  ($25.00)  per  hour  for  utility
compensation if after-hours usage exceeds 250 hours per year.

                                       19
<PAGE>

11.4 Excess Usage by Tenant.  Tenant shall not make  connection to the utilities
except by or through  existing outlets and shall not install or use machinery or
equipment  (other than standard  office and business  equipment) in or about the
Premises that uses excess water,  lighting or power, or suffer or permit any act
that causes extra  burden upon the  utilities  or  services,  including  but not
limited to security services,  over standard office usage for the Building.  Any
disputes regarding excess usage shall be settled in accordance with Paragraph 52
of this Lease.

11.5  Interruptions.  There shall be no abatement of Rent and Landlord shall not
be liable in any respect whatsoever for the inadequacy,  stoppage,  interruption
or  discontinuance  of any  utility or service  provided  to the  Building.  Any
inadequacy,  stoppage,  interruption or discontinuance of any utility or service
due to reasons within the Building or within the Premises, except due to war and
riots,  after five (5)  consecutive  days,  shall result in rent being abated by
fifty percent (50%) until service is restored.

12.   Assignment and Subletting.
      -------------------------

12.1  Landlord's  Consent  Required.  Tenant shall not sell,  mortgage,  pledge,
hypothecate,  encumber or otherwise  transfer this Lease or any interest therein
(each of which actions is hereafter referred to as a "transfer"),  and shall not
sublet the Premises or any part thereof,  without the prior  written  consent of
Landlord in each  instance,  which consent shall not be  unreasonably  withheld,
conditioned,  or delayed.  Notwithstanding the foregoing,  Tenant may (i) assign
this Lease or sublet any portion of the Premises to any company or  professional
corporation or association  affiliated with, owned by, or under common corporate
control with Tenant (as used herein,  "affiliate" and "affiliated"  shall mean a
person or entity  controlled  by  Tenant,  owned in part by one or more  persons
owning  more than ten  percent  (10%) of Tenant or under  contract to Tenant for
management  services);  (ii)  sublease  a portion  of its space to an  insurance
securities,  commercial  leasing,  or investment banking company,  provided each
sublease  does not exceed more than 500 usable  square feet; or (iii) assign the
lease to a new  owner of the  Tenant  assets in the  event  Tenant is  acquired,
merged or otherwise  has a change in  ownership  (a "Change of  Control")  after
Tenant  provides  notice to the  Landlord of such  assignment.  Tenant shall not
assign the lease under any other circumstances without the prior written consent
of Landlord, which consent shall not be unreasonably withheld,  conditioned,  or
delayed.  Any  attempt  to do so  without  such  consent  shall be  voidable  at
Landlord's election. Notwithstanding the foregoing, except in the case of Change
of Control,  Tenant shall remain liable to Landlord for all Rent,  regardless of
any assignment of this Lease.

12.2 Tenant's Application.  If Tenant desires at any time to transfer this Lease
(which  transfer shall in no event be for less than its entire  interest in this
Lease) or to sublet the Premises or any portion thereof,  Tenant shall submit to
Landlord at least thirty (30) days prior to the proposed  effective  date of the
transfer or sublease ("Proposed Effective Date"), in writing:

(a) A notice of intent to  transfer  or  sublease,  setting  forth the  Proposed
Effective  Date,  which shall be no less than thirty (30) days nor more than one
hundred twenty (120) days after the sending of such notice;

(b) The name of the proposed transferee or subtenant;

(c) The  nature of the  proposed  transferee's  or  subtenant's  business  to be
carried on in the Premises;

(d) The terms and provisions of the proposed transfer or sublease; and

(e) Such information as Landlord may reasonably  request concerning the proposed
transferee  or  subtenant,   including  recent  financial  statements  and  bank
references.

                                       20
<PAGE>

12.3 Landlord's Option to Terminate. In the event this Lease is assigned and the
ground level of the Premises is subsequently  abandoned (as defined in Paragraph
25),  Landlord shall have the right,  but not the obligation,  to terminate this
Lease.

12.4 Approval  Procedure.  If Landlord  approves a transfer or sublease,  Tenant
shall,  prior to the  Proposed  Effective  Date,  submit to Landlord an executed
original of the transfer or sublease  agreement for execution by Landlord on the
signature  page after the words  "the  foregoing  is hereby  consented  to".  No
purported transfer or sublease shall be deemed effective as against Landlord and
no proposed transferee or subtenant shall take occupancy unless such document is
so executed by Landlord.

12.5 Required Provisions. Any and all transfer or sublease agreements shall:

(a) Contain such terms as are described in Tenant's  notice under Paragraph 12.2
or as otherwise agreed by Landlord;

(b) Prohibit further  transfers or subleases  without  Landlord's  consent under
this Paragraph 12;

(c) Impose the same obligations and conditions on the transferee or subtenant as
are imposed on Tenant by this Lease  (except as to Rent and term or as otherwise
agreed by Landlord);

(d) Be expressly  subject and  subordinate  to each and every  provision of this
Lease;

(e) Have a term that  expires  on or before the  expiration  of the term of this
Lease;

(e) Have a term that  expires  on or before the  expiration  of the term of this
lease; and

(f) Provide that the Tenant and/or  transferee  or subtenant  shall pay Landlord
the amount of any reasonable costs or expenses incurred by Landlord for repairs,
maintenance  or  otherwise  as a result of any change in the nature of occupancy
caused by the transfer or sublease.

(g) Contain Tenant's  acknowledgment that Tenant remains liable under this lease
notwithstanding the transfer or sublease.

12.6 Transfer of Sublease Profit. [Intentionally Deleted]

12.7 Fees for  Review.  Tenant  shall pay to Landlord  or  Landlord's  designee,
together with the notice  described in Paragraph  12.2,  all  reimbursement,  if
Landlord retains the services of an attorney to review the  transaction,  Tenant
shall pay to  Landlord  all  reasonable  attorneys'  fees  actually  incurred by
Landlord in connection  therewith,  provided  Landlord  provides an attorney fee
estimate to Tenant for approval prior to Landlord engaging the attorney.  Tenant
shall pay such attorneys' fees to Landlord within thirty (30) days after receipt
of written request.

12.8 No Release of Tenant.  No consent by Landlord to any transfer or subletting
by Tenant shall relieve Tenant of any obligation to be performed by Tenant under
this  Lease,  whether  occurring  before  or after  such  consent,  transfer  or
subletting.  Landlord's  consent to any transfer or subletting shall not relieve
Tenant from the obligation to obtain Landlord's express prior written consent to
any other transfer or subletting. The acceptance by Landlord of payment from any
other person shall not be deemed to be a waiver by Landlord of any  provision of
this Lease or to be a consent to any  subsequent  transfer or sublease,  or be a
release of Tenant from any obligation under this Lease.

12.9 Assumption of  Obligations.  Each transferee of this Lease shall assume all
obligations  of Tenant under this Lease and shall be and remain  liable  jointly
and severally with Tenant for the payment of the Rent and the

                                       21
<PAGE>

performance  of all the  terms,  covenants,  conditions  and  agreements  herein
contained  on  Tenant's  part to be  performed  for the term of this  Lease.  No
transfer shall be binding on Landlord  unless the transferee or Tenant  delivers
to  Landlord a  counterpart  of the  instrument  of  transfer  which  contains a
covenant of assumption by the transferee  satisfactory  in substance and form to
Landlord, consistent with the above requirements.  The failure or refusal of the
transferee  to  execute  such  instrument  of  assumption  shall not  release or
discharge  the  transferee  from its liability to Landlord  hereunder.  Landlord
shall have no  obligation  whatsoever  to perform  any duty to or respond to any
request from any subtenant,  it being the obligation of Tenant to administer the
terms of its sublease.

12.10 Deemed Transfers. [Intentionally Deleted]

12.11 Assignment by Operation of Law. [Intentionally Deleted]

12.12 Assignment of Sublease Rents.  Tenant immediately and irrevocably  assigns
to Landlord,  as security for Tenant's  obligations  under this Lease, all rents
from any subletting of all or any part of the Premises;  provided,  however, the
total amount paid to Landlord by Tenant (including amounts paid by subleasee, if
paid   separately)   shall  not  exceed  Tenant's  Rent  obligation   hereunder.
Notwithstanding  the  foregoing,  Tenant shall be permitted to collect all rents
from  subletting,  unless Tenant:  (i) is then in default (beyond any applicable
notice and cure period); and (ii) has received written notice from Landlord that
Landlord will collect such rents directly.

12.13 Prohibition of Assignment to Party in Interest of ERISA Party. If Landlord
is an ERISA Party (see Paragraph  1.16) or an ERISA Party  subsequently  becomes
Landlord hereunder and Tenant is notified of such event, Tenant shall inquire of
any prospective  transferee or subtenant whether it is a "party in interest," as
that term is defined in Section 3 (14) of ERISA,  as to  Landlord.  Tenant shall
not transfer this Lease or sublet any part of the Premises to a person or entity
that Tenant knows or  reasonably  should know is a "party in  interest," as that
term is defined in Section 3(14) of ERISA, as to Landlord.

13.   Default- Remedies.
      -----------------

13.1 Default.  The  occurrence  of anyone or more of the following  events shall
constitute a material default of this Lease by Tenant:

(a) [Intentionally Deleted]

(b) The failure by Tenant to pay Rent or make any other  payment  required to be
made by Tenant hereunder, as and when due, where such failure shall continue for
a period of five (5) business days after receipt of written  notice thereof from
Landlord  to Tenant.  In the event that  Landlord  serves  Tenant  with a notice
regarding such nonpayment  pursuant to any applicable  summary eviction statute,
such notice shall also constitute the notice required by this Subparagraph.

(c) The failure by Tenant to observe or perform any of the covenants, conditions
or  provisions  of this Lease to be observed or  performed  by Tenant other than
those  referenced  in  Subparagraphs  13.1 (a) and (b) where such failure  shall
continue  for a period of thirty  (30) days  after  receipt  of  written  notice
thereof  from  Landlord  to  Tenant,  provided,  however,  that if the nature of
Tenant's  noncompliance  is such that more than thirty (30) days are  reasonably
required  for its cure,  then  Tenant  shall not be deemed to be in  default  if
Tenant  commences  such  cure  within  said  thirty  (30)  days  and  thereafter
diligently pursues such cure to completion. To the extent permitted by law, such
thirty (30) day notice shall  constitute the sole notice required to be given to
Tenant under any applicable summary eviction statute.

                                       22
<PAGE>

(d) (i) The making by Tenant of any arrangement or assignment for the benefit of
creditors;  (ii) Tenant becoming a "debtor" as defined in the Bankruptcy Code or
any successor statute,  (unless, in the case of a petition filed against Tenant,
the same is  dismissed  within  sixty (60)  days);  (iii) the  appointment  of a
trustee or receiver to take possession of  substantially  all of Tenant's assets
located at the Premises or of Tenant's interest in this Lease,  where possession
is not  restored  to Tenant  within  thirty (30) days;  or (iv) the  attachment,
execution or other  judicial  seizure of  substantially  all of Tenant's  assets
located at the  Premises  or of  Tenant's  interest  in this  Lease,  where such
seizure is not  discharged  within  thirty  (30)  days,  all of which are hereby
deemed to be non-  curable  defaults  without  the  necessity  of any  notice by
Landlord to Tenant thereof.

(e) The existence of materially  false  information  in any financial  statement
given to Landlord by Tenant, or its successor in interest or by any guarantor of
any of  Tenant's  obligations  hereunder,  all of which are hereby  deemed to be
non-curable  defaults  without the necessity of any notice by Landlord to Tenant
thereof.

(f) [Intentionally Deleted]

13.2  Remedies.  In the event of any  material  default of this Lease by Tenant,
Landlord may at any time  thereafter,  with or without separate notice or demand
and  without  limiting  Landlord in the  exercise  of any right or remedy  which
Landlord may have by reason of such default:

(a) Terminate this Lease and Tenant's right to possession of the Premises by any
lawful means, in which case Tenant shall immediately surrender possession of the
Premises to Landlord.  In such event, Landlord shall be entitled to recover from
Tenant all damages incurred by Landlord by reason of Tenant's default including,
but not limited to, the cost of recovering possession of the Premises;  expenses
of reletting,  including  necessary  renovation  and alteration of the Premises,
reasonable  attorney's fees, and any real estate  commission  actually paid; the
worth at the  time of award by the  court  having  jurisdiction  thereof  of the
amount by which the  unpaid  Rent for the  balance of the term after the time of
such award  exceeds  the  amount of Rent loss for the same  period  that  Tenant
proves could be reasonably avoided;  that portion of the leasing commission paid
by Landlord  pursuant to Paragraph 15,  applicable to the un-expired term of the
Lease. No payment by Tenant after termination of this Lease following default by
Tenant shall reinstate the Lease. Neither shall the receipt and retention of any
such payment by Landlord reinstate the Lease.

(b) Without terminating this Lease,  re-enter and take possession (in accordance
with legal  process) of the  Premises or any part  thereof and expel  Tenant and
those  claiming  through or under  Tenant,  and  remove  the  effects of both or
either, and relet the Premises,  or any part thereof,  in Landlord's or Tenant's
name, but for the account of Tenant. In such event, Tenant shall in no manner be
relieved from  liability for payment of Rent covering the balance of the term of
this Lease, and Landlord's retaking shall not be considered an acceptance of the
Premises or a manifestation of an intent to terminate this Lease.

(c)  Maintain  Tenant's  right to  possession,  in which case this  Lease  shall
continue in effect  whether or not Tenant shall have  vacated or  abandoned  the
Premises. In such event, Landlord shall be entitled to enforce all of Landlord's
rights and remedies under this Lease, including the right to recover the Rent as
it becomes due hereunder.

(d) Pursue any other  remedy now or hereafter  available  to Landlord  under the
laws or judicial decisions of the state of North Carolina.

(e)  Notwithstanding  the foregoing,  Landlord  acknowledges  and agrees that it
shall use commercially  reasonable  efforts to mitigate its damages in the event
of a Tenant default.

                                       23
<PAGE>

13.3 Default by Landlord. Landlord shall not be in default unless Landlord fails
to perform obligations  required of Landlord within a reasonable time, but in no
event later than thirty (30) days after written notice by Tenant to Landlord and
to the holder of any first mortgage or deed of trust covering the Premises whose
name and address  shall have  theretofore  been  furnished to Tenant in writing,
specifying  wherein  Landlord  has failed to perform such  obligation;  provided
however,  that if the  nature of  Landlord's  obligation  is such that more than
thirty (30) days are required for  performance,  then  Landlord  shall not be in
default if Landlord commences performance within such thirty (30) day period and
thereafter diligently pursues the same to completion.

13.4 Late  Charges.  Tenant hereby  acknowledges  that late payment by Tenant to
Landlord of Base Rent,  Tenant's  Share of Operating  Expense  Increase or other
sums due hereunder will cause Landlord to incur costs not  contemplated  by this
Lease, the exact amount of which will be extremely difficult to ascertain.  Such
costs include,  but are not limited to, processing and accounting  charges,  and
late  charges  which may be imposed on Landlord by the terms of any  mortgage or
trust deed covering the Building.  Accordingly, if any installment of Base Rent,
Operating  Expense  Increase,  or any  other  sum due from  Tenant  shall not be
received  by  Landlord or  Landlord's  designee  within ten (10) days after such
amount shall be due, then, without any requirement for notice to Tenant,  Tenant
shall pay to Landlord a late charge equal to three  percent (3%) of such overdue
amount,  but not to exceed  the  maximum  late  charge  permitted  by law in the
jurisdiction  where the Building is located.  The parties hereby agree that such
late charge represents a fair and reasonable estimate of the costs Landlord will
incur by reason of late  payment by Tenant.  Acceptance  of such late  charge by
Landlord shall in no event  constitute a waiver of Tenant's default with respect
to such overdue  amount,  nor prevent  Landlord from exercising any of the other
rights and remedies granted hereunder.

13.5 Interest on Past-Due Obligations. Any amount not paid by Tenant to Landlord
when  due  shall  bear  interest  from the date  due at the  maximum  rate  then
allowable by law,  except that interest  shall not be payable on any late charge
and  interest  on any  amount  upon  which a late  charge is  payable  shall not
commence  to accrue  until  thirty  (30) days  after  the date due.  Payment  of
interest shall not excuse or cure any default by Tenant.

14.  Condemnation.  If the  Premises or any portion  thereof or the Building are
     ------------
taken  under the  power of  eminent  domain,  or sold  under  the  threat of the
exercise  of said power (all of which are herein  called  "condemnation"),  this
Lease  shall  terminate  as to the part so  taken as of the date the  condemning
authority takes title or possession, whichever first occurs; provided that if so
much of the  Premises  or the  Building is taken by such  condemnation  as would
substantially  and adversely affect the operation and  profitability of Tenant's
business  conducted  from the  Premises,  Tenant  shall have the  option,  to be
exercised only in writing within thirty (30) days after the condemning authority
shall  have  taken  possession,  to  terminate  this  Lease  as of the  date the
condemning  authority takes such  possession.  If Tenant does not terminate this
Lease in accordance  with the  foregoing,  this Lease shall remain in full force
and effect as to the portion of the Premises remaining, except that the Rent and
Tenant's Share of Operating  Expense Increase shall be reduced in the proportion
that the floor area of the  Premises  taken bears to the total floor area of the
Premises.  Common Areas taken shall be excluded  from the Common Areas usable by
Tenant and no reduction  of Rent shall occur with  respect  thereto or by reason
thereof. Landlord shall have the option to terminate this Lease as of the taking
of possession by the condemning authority, by giving written notice to Tenant of
such  election  within  thirty (30) days after  receipt of notice of a taking by
condemnation  of any part of the  Premises  or the  Building.  Any award for the
taking of all or any part of the  Premises  or the  Building  under the power of
eminent  domain or any payment  made under  threat of the exercise of such power
shall be the  property of  Landlord;  provided,  however,  that Tenant  shall be
entitled to any separate award for loss of or damage to Tenant's trade fixtures,
its leasehold  interest,  removable  personal  property and un-amortized  tenant
improvements  that have been paid for by Tenant.  For that purpose,  the cost of
such  improvements  shall be  amortized  over  the  original  term of the  Lease
excluding any options.  In the event that this Lease is not terminated by reason
of such  condemnation,  Landlord  shall,  to the  extent  of  severance  damages
received by Landlord in connection with such condemnation,  repair any damage to
the

                                       24
<PAGE>

Premises caused by such  condemnation  except to the extent that Tenant has been
reimbursed  therefore by the condemning  authority.  Any disputes regarding this
Paragraph shall be settled pursuant to Paragraph 52 of this Lease.

15.   Broker's Fee.
      ------------

(a) Subject to the execution of this Lease by both parties,  Landlord  shall pay
to the  Listing  Broker  and  the  Cooperating  Broker,  if any,  designated  in
Paragraphs  1.14 and 1.15 of this Lease jointly,  or in such separate  shares as
they may  mutually  designate  in  writing,  a fee as set  forth  in a  separate
agreement between Landlord and the Listing Broker.

(b) Tenant and Landlord each represent and warrant to the other that neither has
had any  dealing  with any  person,  firm,  broker  or  finder  (other  than the
person(s),  if any,  whose names are set forth in  Paragraphs  1.14 and 1.15) in
connection  with  the  negotiation  of this  Lease  or the  consummation  of the
transaction  contemplated  hereby, and no other broker or other person,  firm or
entity is entitled to any  commission  or finder's fee in  connection  with said
transaction and Tenant and Landlord do each hereby  indemnify and hold the other
harmless from and against any costs, expenses,  attorneys' fees or liability for
compensation or charges which may be claimed by any such unnamed broker,  finder
or other similar party by reason of any dealings or actions of the  indemnifying
party.

16.   Estoppel Certificates.
      ---------------------

(a) Each party (as "responding  party") shall at any time upon not less than ten
(10) business  days after  receipt of prior written  notice from the other party
("requesting party") execute,  acknowledge and deliver to the requesting party a
statement (to the extent true and to the responding party's actual knowledge) in
writing  (i)  certifying  that this  Lease is  unmodified  and in full force and
effect (or, if modified,  stating the nature of such modification and certifying
that this Lease,  as so  modified,  is in full force and effect) and the date to
which  the  rent  and  other  charges  are  paid in  advance,  if any,  and (ii)
acknowledging  that there are not,  to the  responding  party's  knowledge,  any
uncured  defaults  on the  part of the  requesting  party,  or  specifying  such
defaults if any are claimed.  Any such statement may be conclusively relied upon
by any prospective  purchaser or encumbrancer of the Building or of the business
of Tenant.

(b) At the requesting  party's option, the responding party's failure to respond
within such time shall be  conclusive  upon such party that (i) this Lease is in
full force and effect,  without modification except as may be represented by the
requesting  party,  (ii) there are no known uncured  defaults in the  requesting
party's  performance,  and (iii) if Landlord is the requesting  party,  not more
than one month's rent has been paid in advance.

(c) [Intentionally Deleted]

17. Landlord's Liability. The term "Landlord" as used herein shall mean only the
    --------------------
owner or  owners,  at the time in  question,  of the fee title or the  leasehold
interest  under a ground lease of the Building.  In the event of any transfer of
such title or interest,  Landlord  herein  named (and in case of any  subsequent
transfers  then the grantor)  shall be relieved  from and after the date of such
transfer of all liability as respects  Landlord's  obligations  thereafter to be
performed,  provided:  (i) any  successor  in interest or  transferee  expressly
assumes the  obligations of Landlord  hereunder,  in writing;  and (ii) that any
funds in the hands of Landlord or the then grantor at the time of such transfer,
in  which  Tenant  has an  interest,  shall be  delivered  to the  grantee.  The
obligations contained in this Lease to be performed by Landlord shall be binding
on Landlord's  successors and assigns,  only as to matters  arising during their
respective  periods of ownership.  The liability of Landlord for the performance
of its duties and obligations under this Lease is limited to Landlord's interest
in the Building

                                       25
<PAGE>

(including  rental income and  insurance/condemnation  proceeds) and neither the
Landlord nor its partners, shareholders, officers or other principals shall have
any personal liability under this Lease.

18. Severability. The invalidity of any provision of this Lease as determined by
    ------------
a court of  competent  jurisdiction  shall in no way affect the  validity of any
other provision hereof.

19. Force Majeure.  Any obligation of Landlord or Tenant which is delayed or not
    -------------
performed due to an act of God,  strike,  riot,  shortage of labor or materials,
war  (whether  declared  or  undeclared),   laws,  governmental  regulations  or
restrictions or any other governmental action or inaction, or any other cause of
any kind whatsoever which is beyond the responsible  party's reasonable control,
shall  not  constitute  a default  hereunder  and  shall be  performed  within a
reasonable time after the end of the cause for delay or non-performance.

20. Time is of Essence.  Time is of the essence with respect to the  obligations
    ------------------
to be performed under this Lease.

21.  Additional  Rent. All monetary  obligations of Tenant to Landlord under the
     ----------------
terms of this Lease, including but not limited to any expenses payable by Tenant
hereunder, shall be deemed to be rent.

22.  Incorporation  of Prior  Agreement;  Amendments.  This Lease  contains  all
     -----------------------------------------------
agreements of the parties with respect to any matter mentioned  herein. No prior
or  contemporaneous  agreement or  understanding  pertaining  to any such matter
shall be effective.  This Lease may be modified in writing  only,  signed by the
parties in interest at the time of the modification.  Except as otherwise stated
in this Lease,  Tenant hereby  acknowledges  that neither the Listing Broker nor
the Cooperating  Broker, if any, designated in Paragraphs 1.14 and 1.15, nor the
Landlord or any  employee  or agent of any of said  persons has made any oral or
written warranties or representations to Tenant relative to the condition or use
by Tenant of the Premises or Building.

23. Notices.  Any notice required or permitted to be given hereunder shall be in
    -------
writing and may be given by personal delivery or by certified or registered mail
(provided  that notice of exercise of any Option,  as defined in  Paragraph  39,
must in all events be given by  certified  or  registered  mail)  addressed to a
party at the following address:

     If to Landlord:                    333 Ventures, LLC
                                        333 Fayetteville Street, Suite 100
                                        Raleigh, NC 27601
                                        Attention: Ms. Jacqueline Barker
                                        Phone: 919-754-8073
                                        Fax: 919-754-8077

              with a copy to:           Sanford Holshouser, LP
                                        219 Fayetteville Street, Suite 1000
                                        Raleigh, North Carolina 27601
                                        Attention: Samuel W. Whitt, Esq.
                                        Phone: 919-755-1800
                                        Fax: 919-829-0272

                                       26
<PAGE>

     If to Tenant:                      Capital Bank Corporation
                                        4901 Glenwood Avenue
                                        Raleigh, NC  27612
                                        Attention: John Anthony and Grant Yarber
                                        Phone: 919-645-3494
                                        Fax: 919-645-3490

              with a copy to:           Smith, Anderson, Blount, Dorsett,
                                        Mitchell & Jernigan, L.L.P.
                                        2500 Wachovia Capital Center
                                        Raleigh, North Carolina 27601
                                        Attention: Stephen T. Parascandola, Esq.
                                        Phone: 919-821-1220
                                        Fax: 919-821-6800

or such other address for notice purposes as may be later specified by notice to
the other party. Mailed notices shall be deemed given upon actual receipt at the
address required, or upon refusal thereof.

24.  Waivers.  No waiver by Landlord or Tenant of any provision  hereof shall be
     -------
deemed a waiver of any other provision or of any subsequent  breach by the other
party of the same or any other provision.  Landlord's or Tenant's consent to, or
approval of, any act shall not be deemed to render  unnecessary the obtaining of
the other  party's  consent to or  approval of any  subsequent  act by the other
party. The acceptance of rent by Landlord shall not be a waiver of any preceding
breach  of  this  Lease  by  Tenant,  other  than  Tenant's  failure  to pay the
particular  rent  so  accepted,  regardless  of  Landlord's  knowledge  of  such
preceding  breach at the time of  acceptance of such rent. A copy of all notices
required to be given to Landlord hereunder shall be concurrently  transmitted to
such other party(ies) as designated in advance by Landlord to Tenant.

25.  Vacation  or  Abandonment  of  Premises.  In the event  that  Tenant or its
     ---------------------------------------
assignees  shall fail to conduct  business on the ground  level for a continuous
period of sixty  (60) days or more,  whether or not Rent is paid,  said  failure
shall be  considered  an  "Abandonment."  Tenant  acknowledges  and agrees  that
occupancy of the ground level is an item of importance to Landlord. Thus, in the
event of an Abandonment, Tenant agrees to use commercially reasonable efforts to
effectuate a sublease/assignment for the ground level space. Landlord and Tenant
will also entertain, in good faith, potential arrangements for a full or partial
termination of the Lease (in the event of an Abandonment).

26.  Holding  Over.  If Tenant  remains in  possession of all or any part of the
     -------------
Premises after the expiration of the term of this Lease, such occupancy shall be
a  tenancy  from  month-to-month  upon  all  of the  provisions  of  this  Lease
pertaining to the obligations of Tenant, except that the Base Rent payable shall
be one hundred and fifty  percent  (150%) of the Base Rent  payable  immediately
preceding the expiration of the term.

27.  Cumulative  Remedies.  No  remedy  or  election  hereunder  shall be deemed
     --------------------
exclusive but shall, wherever possible, be cumulative with all other remedies at
law or in equity.

28.  Covenants and  Conditions.  Each provision of this Lease to be performed by
     -------------------------
Landlord or Tenant shall be deemed both a covenant and a condition.

29. Binding Effect;  Choice of Law. Subject to any provisions hereof restricting
    ------------------------------
assignment or  subletting  by Tenant and subject to the  provisions of Paragraph
17, this Lease shall bind the parties, their personal

                                       27
<PAGE>

representatives,  successors  and  assigns.  This Lease shall be governed by the
laws of the State where the  Building is located and any  litigation  concerning
this Lease between the parties  hereto shall be initiated in the county in which
the Building is located.

30.   Subordination.
      -------------

30.1 Provided  that  Landlord  provides  Tenant with a  commercially  reasonable
non-disturbance  agreement  (a  specimen  form of which is  attached  hereto  as
Exhibit E), this Lease,  including but not limited to any Option,  as defined in
Paragraph 39, shall, at Landlord's  option,  be subordinate to any ground lease,
mortgage,  trust deed, or any other security interest now or hereafter affecting
the Building and to any and all advances made on the security thereof and to all
renewals,  modifications,  consolidations,  replacements and extensions thereof.
Notwithstanding  such  subordination,  Tenant's right to quiet possession of the
Premises  shall not be  disturbed  if Tenant  is not in  default  and so long as
Tenant shall pay the Rent and observe and perform all of the  provisions of this
Lease,  unless this Lease is otherwise  terminated pursuant to its terms. If any
ground  lessor  or the  holder of any  mortgage,  trust  deed or other  security
interest  shall  elect to have this Lease prior to its ground  lease,  mortgage,
trust deed or other security interest,  and shall give written notice thereof to
Tenant, this Lease shall be deemed prior to such ground lease,  mortgage,  trust
deed or other security interest, whether this Lease is dated prior or subsequent
to the  date of said  ground  lease,  mortgage,  trust  deed or  other  security
interest or the date of recording thereof.  Upon termination of any ground lease
or foreclosure of any mortgage, deed of trust or other security interest, Tenant
shall attorn to the ground lessor or any purchaser  upon  foreclosure,  provided
that said entity  expressly  assumes (in  writing) the  obligations  of Landlord
hereunder.

30.2 Tenant agrees to execute any documents  (within a reasonable period of time
after   receipt  of  written   request   therefor)   required  to  effectuate  a
subordination  or  attornment,  or to make this Lease prior to any ground lease,
mortgage,  trust deed or other  security  interest,  if  requested by the ground
lessor or holder of the mortgage, trust deed or other security interest.

31.  Attorneys'  Fees.  If either party brings any lawsuit to enforce or declare
     ----------------
rights  under this Lease,  the  prevailing  party in the action,  including  any
appeal, shall be entitled to reasonable attorneys' fees paid by the losing party
as fixed by the court in the same or a separate proceeding,  whether or not such
action is pursued to decision or judgment. The attorneys' fee award shall not be
computed  in  accordance  with any court fee  schedule,  but shall be such as to
fully reimburse all attorneys' fees reasonably incurred in good faith.

32.   Landlord's Access.
      -----------------

32.1 Landlord and  Landlord's  agents shall have the right to enter the Premises
at reasonable times,  upon reasonable  advance notice (except in the event of an
emergency) and subject to Tenant's reasonable security measures, for the purpose
of inspecting the same,  performing any services  required of Landlord,  showing
the same to prospective  purchasers,  lenders,  or lessees (during the last nine
(9) months of the Term),  taking such  measures,  erecting such  scaffolding  or
other necessary structures,  making such alterations,  repairs,  improvements or
additions to the Premises or to the  Building as Landlord  may  reasonably  deem
necessary or desirable and the  erecting,  using and  maintaining  of utilities,
services,  pipes and conduits through the Premises and/or other premises as long
as there is no  unreasonable  interference  with  Tenant's use of the  Premises.
Landlord  may at any time place on or about the  Premises,  the  Building or the
Building  "For  Sale"  signs and  Landlord  may at any time  during the last one
hundred twenty (120) days of the term place on or about the Premises "For Lease"
signs.

32.2 All  activities  of  Landlord  pursuant  to  Paragraph  32 shall be without
abatement  of Rent and Landlord  shall not have any  liability to Tenant for the
same.

                                       28
<PAGE>

32.3 Landlord  shall have the right to retain keys to the Premises and to unlock
all doors in or upon the Premises other than files, vaults and safes, and in the
case of emergency to enter the Premises by any reasonably appropriate means, and
any such entry shall not be deemed a forcible  or unlawful  entry or detainer of
the Premises or an eviction.

33. Auctions,  Other Sales and Cessation of Business.  Tenant shall not conduct,
    ------------------------------------------------
nor permit to be conducted,  either  voluntarily or  involuntarily,  any auction
upon the Premises or the Common Areas without  Landlord's prior written consent.
Notwithstanding  anything to the contrary in this Lease,  Landlord  shall not be
obligated to exercise any standard of reasonableness  in determining  whether to
grant such consent.

34. Signs.  Landlord shall provide Tenant with exclusive  Building naming rights
    -----
and  placement  of signs naming the  Building,  based on the terms in Exhibit D.
Tenant  shall have  certain  exclusive  rights to post signs upon the  Premises,
based on  reasonable  requests and  agreement by both  parties.  All other signs
placed by Tenant shall require  Landlord  approval,  which approval shall not be
unreasonably withheld,  conditioned,  or delayed.  Landlord shall provide Tenant
with standard door signage for each floor or suite and directory  signage on the
lobby  Marquee  at no cost to  Tenant.  All  other  signage,  including  signage
associated with re-naming the Building, signage on the exterior of the building,
signage in the lobby or any similar  non-standard  Building Tenant signage shall
be a Tenant expense.

35.  Merger.  The  voluntary  or  other  surrender  or  mutual  cancellation  or
     ------
termination  by  Landlord  of this  Lease  shall  not  result in a merger of the
interest of the  Landlord  and the  interest of the  Tenant,  but shall,  at the
option of Landlord,  terminate all or any sub-tenancies or may, at the option of
Landlord, operate as an assignment to Landlord of any or all sub-tenancies.

36.  Consents.  Except for Paragraph 33 (Auctions,  Other Sales and Cessation of
     --------
Business)  and  Paragraph  49  (Hazardous  Material) as it relates to causing or
permitting any Hazardous  Material to be brought upon,  kept or used in or about
the Premises,  wherever in this Lease the consent of one party is required to an
act of the  other  party  such  consent  shall  not  be  unreasonably  withheld,
conditioned, or delayed.

37. Guarantor. [Intentionally Deleted]
    ---------

38. Quiet Enjoyment.  Upon Tenant paying the rent for the Premises and observing
    ---------------
and performing all of the covenants,  conditions and provisions on Tenant's part
to be observed and performed hereunder, Tenant shall have quiet enjoyment of the
Premises for the entire term subject to all of the provisions of this Lease.

39.   Options.
      -------

39.1  Options  Personal.  The term  "Option" as used in this Lease refers to any
option to  extend,  renew or expand  and to any right of first  refusal or first
offer  granted to Tenant,  as set forth in this  Paragraph  39 and in Exhibit D,
                                                                      ---------
Paragraph 4. Each Option is personal to the original Tenant and may be exercised
-----------
only by the  original  Tenant  (or an  entity  for  which  Tenant  did not  need
Landlord's consent for sublease/assignment) while occupying the Premises without
the intent of thereafter  assigning this Lease or subletting the Premises or any
portion thereof,  and may not be, voluntarily or involuntarily,  exercised by or
assigned to any other person or entity. Options shall not be assignable separate
and apart  from this  Lease,  and may not be  separated  from this  Lease in any
manner, by reservation or otherwise.

39.2 Option to Renew.

(a) Tenant shall have the right, at its option, to renew this Lease, as the same
may have been amended from time to time, for two renewal terms of five (5) years
each,  with the first  commencing  on the day  following  the  expiration of the
initial lease term and the second commencing on the day following  expiration of
the first renewal option term.

                                       29
<PAGE>

(b) Tenant  shall  exercise  the renewal  option by giving to  Landlord  written
notice of such  election to renew not later than one hundred  eighty  (180) days
prior to the expiration of the initial lease term.

(c) All the terms,  provisions,  agreements,  covenants  and  conditions of this
Lease  shall  continue in full force and effect  during the renewal  term except
that the Base Rent for the first  year of the  renewal  term shall be the lesser
of: (1) the rental rate in effect at the end of the  initial  term of this lease
plus 3%; or (2) the Fair Market  Rental (as defined in Exhibit D,  Paragraph 4).
The  rate  shall  increase  at the rate of 3% per  year  during  the term of the
renewal period.

(d) Any  termination,  cancellation,  surrender,  sublease or assignment of this
Lease (if  Landlord's  consent  thereto is required  under the Lease) during the
Term shall terminate any right of renewal hereunder.

(e) As used herein,  "Term" shall include the renewal term of this Lease if this
Lease is renewed pursuant to the provisions of this Paragraph.

39.3 Option to Expand & Right of First  Refusal.  Subject to the  provisions  of
this  Paragraph 39 and the rights of other  tenants,  if any other tenant on the
Tenant's  floor of the  Building  does not renew or extend  their lease or their
lease is otherwise  terminated,  Tenant shall have the first right of refusal to
lease said tenant's  space upon the same terms and  conditions  and at the lower
of: (i) the per square foot rate (with substantially  similar Tenant Improvement
allowance provisions, prorated to account for the portion of the Term remaining)
as then currently applicable under this Lease; or (ii) the Fair Market Rental as
defined in (Exhibit D,  Paragraph 4 hereto).  Tenant shall have thirty (30) days
written notice for exercising said option. Notwithstanding the foregoing, Tenant
may only  exercise  this  right if: (i) at least  three (3) years  remain in the
Term;  or (ii) Tenant offers to extend the Term so that at least three (3) years
remain.

39.4 Option for  Alternative  Premises.  In the event Tenant  determines that it
requires  alternative space to the Premises provided under this Lease,  Landlord
shall make  reasonable  efforts to lease to Tenant  alternative  premises in the
Building at the same terms and  conditions  set forth in this  Lease,  provided,
however,  the move to  alternative  space  shall be subject to  Landlord's  sole
discretion.

39.5 Option for  Additional  Premises.  In the event Tenant  determines  that it
desires  additional  square  footage  in  the  Building,   Landlord  shall  make
reasonable  efforts  to lease to  Tenant  such  additional  space.  In the event
Landlord  procures such addition  square  footage for Tenant,  a lease  addendum
shall be entered into for a minimum term of thirty-six (36) months, with rent on
the  additional  space at the  lower of:  (i) the per  square  foot  rate  (with
substantially  similar  Tenant  Improvement  allowance  provisions,  prorated to
account  for the portion of the Term  remaining)  as then  currently  applicable
under this  Lease;  or (ii) the Fair  Market  Rental  (as  defined in Exhibit D,
Paragraph  4  hereto),  and  incorporating  substantially  the  same  terms  and
conditions  as provided  in this Lease.  39.6  Multiple  Options.  If Tenant has
multiple  options  to extend  or renew  this  Lease,  a later  option  cannot be
exercised unless the prior option to extend or renew has been exercised.

39.7 Effect of Default on Options.

(a)  Tenant  shall  have no right  to  exercise  any  Option  set  forth in this
Paragraph  39,  notwithstanding  any provision in the grant of the Option to the
contrary,  (i) if Tenant has committed any non-curable material default, or (ii)
from the date  Landlord  gives  Tenant  notice  of a curable  default  until the
default is cured, or (iii) from the day after a monetary  obligation to Landlord
is due from  Tenant and  unpaid  (without  any  necessity  of notice  thereof to
Tenant)  until the  obligation is paid; or (iv) if, during the twelve (12) month
period prior to the date Tenant gives  Landlord  notice of Tenant's  exercise of
the option,  Landlord has given to Tenant three or more notices of default under
Paragraph 13.1 (b) or (c),  whether or not the defaults are cured. The period of

                                       30
<PAGE>

time within which an Option may be exercised  shall not be extended by reason of
Tenant's  inability  to exercise  an option  because of the  provisions  of this
Paragraph 39.

(b) All rights of Tenant under the provisions of any Option shall  terminate and
be of no  further  force or  effect,  notwithstanding  Tenant's  due and  timely
exercise  of the  Option,  if after  such  exercise  (i)  Tenant  fails to pay a
monetary obligation to Landlord within thirty (30) days after receipt of written
notice of such  delinquency,  (ii) Tenant fails to cure a default when  required
after  notice  given  pursuant to Paragraph  13.1 (c), or (iii)  Landlord  gives
Tenant  three (3) or more  notices of default  (in any  consecutive  twelve (12)
month period) under  Paragraph 13.1 (c),  whether or not the defaults are cured,
or (iii) Tenant commits any non-curable material default.

40.   Security Measures-Landlord's Reservations.
      -----------------------------------------

40.1 Obligation.  Tenant assumes all responsibility for the protection of Tenant
and its  agents  and  invitees  and the  property  of Tenant  and its agents and
invitees from acts of third  parties.  Nothing  herein  contained  shall prevent
Landlord,  at Landlord's sole option, from providing security protection for the
Building or any part thereof,  in which event the cost thereof shall be included
within the definition of Operating  Expenses,  as set forth in Paragraph 4.2(b).
Notwithstanding the foregoing, Landlord represents that it shall continue at its
own expense to contract for a comparable level of Security in the Building.

40.2 Landlord shall have the following rights:

(a) [Intentionally Deleted]

(b) To provide and install Building standard (beyond  "Building  standard" is at
Tenant's  cost  and  expense)  graphics  on the  door of the  Premises  and such
portions of the Common Areas as Landlord shall reasonably deem appropriate;

(c) To grant to any lessee of the  Building the  exclusive  right to conduct any
business  as long as such  exclusive  right  does not  conflict  with any rights
expressly given herein including the provisions of Paragraph 6.1.

(d) [Intentionally Deleted]

40.3 Tenant shall not:

(a) [Intentionally Deleted]

(b) Suffer or permit  anyone,  except in  emergency,  to go upon the roof of the
Building.

40.3  Representation of the Building.  Landlord grants Tenant, as part of naming
rights,  the right to use  representation  (photographic  or  otherwise)  of the
Building in  connection  with  Tenant's  business,  provided such usage does not
negatively impact Building image or public  perception.  Landlord shall have the
reasonable   right,  by  written  notice  to  Tenant,   to  object  to  Tenant's
representation  of the  Building.  In the  event  of  such  dispute,  the  chief
executive  officer and  managing  member,  respectively,  of Tenant and Landlord
shall work in good faith to resolve any differences in the representation of the
Building.

                                       31
<PAGE>

41.   Easements.
      ---------

41.1  Landlord  reserves the right,  from time to time,  to grant  easements and
rights,  make dedications and record maps affecting the Building as Landlord may
deem necessary or desirable, so long as such easements, rights, dedications, and
maps do not  unreasonably  interfere  with the use of the  Premises  by  Tenant.
Tenant  shall  sign any of the  after-mentioned  documents  within a  reasonable
period of time following receipt of written request of Landlord.

41.2 The obstruction of Tenant's view, air, or light by any structure erected in
the vicinity of the Building,  whether by Landlord or third parties, shall in no
way affect this Lease or impose any liability upon Landlord.

42. Performance. If at any time a dispute shall arise as to any amount or sum of
    -----------
money to be paid by one party to the  other  under the  provisions  hereof,  the
party against whom the  obligation  to pay the money is asserted  shall have the
right to make payment "under  protest" and such payment shall not be regarded as
a voluntary payment, and there shall survive the right on the part of said party
to institute  suit for recovery of such sum. If it shall be adjudged  that there
was no legal  obligation  on the part of said  party to pay such sum or any part
thereof,  said party shall be entitled to recover such sum or so much thereof as
it was not legally required to pay under the provisions of this Lease.

43. Authority. If Landlord or Tenant is a corporation,  trust, limited liability
    ---------
company or general or limited  partnership,  said  entity,  and each  individual
executing  this Lease on behalf of such entity  represent  and warrant that such
individual  is duly  authorized  to execute and deliver  this Lease on behalf of
said entity.

44. Conflict. [Intentionally Deleted]
    --------

45. No Offer.  Preparation  of this Lease by  Landlord or  Landlord's  agent and
    --------
submission  of same by Landlord or Tenant shall not be deemed an offer to lease.
This Lease  shall  become  binding  upon  Landlord  and  Tenant  only when fully
executed by both parties.  Notwithstanding any other provision contained in this
Lease to the  contrary,  this Lease is subject to Tenant  obtaining  approval at
this  site  from all  applicable  regulatory  authorities,  including  the North
Carolina  Banking  Commission  and the FDIC.  Tenant  agrees to  diligently  and
continuously pursue obtaining such approvals. If approval by all such regulatory
authorities  is not obtained on or before the  Commencement  Date,  Tenant shall
have the option within the next  succeeding  ten (10) days by written  notice to
Landlord to cancel this Lease. At such time as the required regulatory approvals
are obtained, Tenant shall give Landlord prompt written notice thereof.

46. Lender Modification.  Tenant agrees to make technical  modifications to this
    -------------------
Lease if  reasonably  required by an  institutional  lender in  connection  with
normal financing/refinancing of the Building.

47.  Multiple  Parties.  If more  than one  person  or entity is named as either
     -----------------
Landlord or Tenant herein,  except as otherwise  expressly  provided herein, the
obligations  of the  Landlord  or Tenant  herein  shall be the joint and several
responsibility  of all  persons or  entities  named  herein as such  Landlord or
Tenant, respectively.

48. ERISA Representation. [Intentionally Deleted]
    --------------------

49.  Hazardous  Material.  Except for  standard  quantities  of office  supplies
     -------------------
reasonably  incident  to the use  listed in  Paragraph  1.4 of the  Basic  Lease
Provisions,  Tenant  shall  not  cause or  permit  any  Hazardous  Material  (as
hereinafter  defined) to be brought upon,  kept or used in or about the Premises
by Tenant,  its agents,  employees,  contractors or invitees,  without the prior
written  consent of  Landlord,  which  consent  may be granted  or  withheld  in
Landlord's sole discretion.  For the purpose of this Lease, "Hazardous Material"
shall  include  oil,   flammable   explosives,   asbestos,   urea  formaldehyde,
radioactive  materials or waste,  or other  hazardous,  toxic,  contaminated  or
polluting materials,  substances or wastes, including,  without limitation,  any
"hazardous

                                       32
<PAGE>

substances,"  "hazardous wastes," "hazardous materials" or "toxic substances" as
such terms are defined in the  Resource  Conservation  and  Recovery Act and the
Comprehensive Environmental Response, Compensation and Liability Act, and in any
other law,  ordinance,  rule,  regulation or order promulgated by the federal or
state government,  or any other governmental entity having jurisdiction over the
Building or the parties to this Lease.  If Tenant  breaches the  obligations set
forth in this  Paragraph  49, or if the  presence of  Hazardous  Material in the
Premises  or at the  Building  caused or  permitted  by Tenant  (whether  or not
Landlord has given its consent to the presence of such Hazardous Material in the
Premises) proximately results in contamination of the Premises or any other part
of the  Building,  or if  contamination  of the Building by  Hazardous  Material
otherwise  occurs  for  which  Tenant  is  legally  liable,  then  Tenant  shall
indemnify, defend and hold Landlord harmless from any and all claims, judgments,
damages,  penalties,  fines, costs,  liabilities or losses,  including,  without
limitation,  diminution  in  value  of the  Building,  damages  for the  loss or
restriction  on use of  rentable  or  useable  space or floor  area in or of any
amenity of the Building,  damages proximately arising from any adverse impact on
leasing space in the Building, sums paid in settlement of claims, and reasonable
any attorneys' fees, consultant fees and expert fees which arise during or after
the term of this Lease as a result of such contamination.  This  indemnification
of Landlord by Tenant shall survive  expiration or termination of this Lease and
includes,   without   limitation,   costs   incurred  in  connection   with  any
investigation  of  site  conditions  or  any  cleanup,   remedial,   removal  or
restoration work required by any federal,  state or local governmental agency or
political  subdivision because of Hazardous Material present in, on or under the
Premises.  Without limiting the foregoing, if it can be objectively demonstrated
that the presence of any Hazardous Material caused or permitted by Tenant or its
agents, employees,  contractors or invitees, results in any contamination of the
Building,  Tenant shall  promptly take  remediation  and/or  assessment  actions
required by  applicable  law and agencies  having  jurisdiction;  provided  that
Landlord's  approval of such  actions  shall first be obtained,  which  approval
shall not be  unreasonably  withheld,  conditioned,  or  delayed.  Tenant  shall
promptly notify Landlord of any such known contamination.

50.  Attachments.  Attached hereto are the following Exhibits which constitute a
     -----------
part of this Lease.

EXHIBIT A: Premises.

EXHIBIT B: Rules and Regulations.

EXHIBIT C: Tenant Improvements.

EXHIBIT D: Additional Provisions (as modified)

EXHIBIT E: SNDA Specimen Form

51.  Miscellaneous.  This  Agreement and the  Exhibit(s)  hereto  constitute the
     -------------
entire agreement  between the parties  regarding the subject matter hereof.  The
parties  shall  not be  bound by or  liable  for any  prior  or  contemporaneous
statement,  writing,  representation,   promise,  inducement  or  understanding,
written or oral,  not set forth in this  Agreement and any  attachments  hereto.
This Agreement may be executed in  counterparts.  This Agreement  (including any
attachment hereto) may not be amended or modified except by a written instrument
signed by duly authorized officers or representatives of the parties hereto. Any
attempt to modify the Agreement by an oral  understanding is void and shall have
no effect.  This Agreement shall be binding upon and inure to the benefit of the
parties  hereto and their  successors and permitted  assigns only.  Each party's
respective  obligations under this Agreement which are not, by the express terms
of this Agreement, fully to be performed during the term of this Agreement shall
survive the  termination  of this  Agreement  for any reason.  At the request of
either party, the parties shall promptly execute and record,  at the cost of the
requesting  party, a short form  memorandum  describing the Premises and stating
this Lease's Term, its Commencement and Termination Dates, and other information
that the parties agree to include.

                                       33
<PAGE>

52. Dispute Resolution. The parties shall make good faith efforts to resolve any
    ------------------
disputes  concerning  Lease  matters.  Following  such good faith  efforts,  all
disputes,  claims,  and  causes one party  makes  against  the other,  at law or
otherwise,  including third party or "pass-through"  claims for  indemnification
and/or contribution, shall be initiated, determined, and resolved by arbitration
in Wake County,  North Carolina,  in accordance with the Commercial  Arbitration
Rules of the  American  Arbitration  Association,  and  judgment  upon the award
rendered by the  Arbitrator(s)  may be entered in any court having  jurisdiction
thereof.

                            [Signature Page Follows]

                                       34
<PAGE>

LANDLORD  AND  TENANT  HAVE  CAREFULLY  READ AND  REVIEWED  THIS  LEASE AND EACH
PROVISION IN IT AND BY EXECUTING IT, SHOW THEIR INFORMED AND VOLUNTARY  CONSENT.
THE  PARTIES  AGREE  THAT,  AT THE TIME THIS  LEASE IS  EXECUTED,  ITS TERMS ARE
COMMERCIALLY  REASONABLE  AND  EFFECTUATE THE INTENT AND PURPOSE OF LANDLORD AND
TENANT WITH RESPECT TO THE PREMISES.

This Lease has been prepared for  submission  to your attorney for approval;  no
representation  or  recommendation  is made as to the legal  sufficiency,  legal
effect,  or tax consequences of this Lease or the transaction  relating thereto;
the parties  shall rely solely upon the advice of their own legal  counsel as to
the legal and tax consequences of this issue.

<TABLE>
<CAPTION>

              LANDLORD                                         TENANT

<S>                                            <C>
333 Ventures, LLC                              Capital Bank Corporation
A North Carolina Limited Liability Company     A North Carolina Corporation

By: /s/Donald F. Carter                        By: /s/B. Grant Yarber
    -------------------                            ------------------

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

WITNESS / ATTEST: /s/Jacqueline Barber         WITNESS / ATTEST: /s/Jacqueline Barber
                  --------------------                          ---------------------

On:                                            On:
    --------------------------------------         -----------------------------------

Address                                        Address
       -----------------------------------            --------------------------------

------------------------------------------     ---------------------------------------

</TABLE>

                                       35
<PAGE>

                                    EXHIBIT A

                                    PREMISES

      Premises  location,  rentable  square  footage and occupancy  dates are as
follows:

               Location                Rentable SF   Occupancy Date
               --------                -----------   --------------

               1st floor Office area      1,597      April 1, 2006
               1st floor lobby            2,400      April 1, 2006
               3rd Floor                 10,955      April 1, 2006
               4th Floor                 10,955      April 1, 2006
                                         ------
                    Subtotal             25,907

               2nd Floor Office           7,542      November 1, 2006

               6th Floor                 10,955      July 1, 2007

               7th Floor                 10,955      January 1, 2008
                                         ------

                    Total                55,359

                                       36
<PAGE>

                                    EXHIBIT B
                 RULES AND REGULATIONS FOR STANDARD OFFICE LEASE

GENERAL RULES

1.  Tenant  shall not suffer or permit  the  obstruction  of any  Common  Areas,
including driveways, walkways and stairways.

2. Landlord  reserves the right to refuse access to any persons Landlord in good
faith  judges to be a threat  to the  safety,  reputation,  or  property  of the
Building and its occupants.

3.  Tenant  shall  not make or  permit  any  noise or  odors  that  unreasonably
interfere with other lessees or persons having business within the Building.

4. Tenant  shall not keep animals or birds  within the  Building,  and shall not
bring  bicycles,  motorcycles  or other  vehicles  into areas not  designated as
authorized for same.

5.  Tenant  shall  not  make,  suffer or  permit  litter  except in  appropriate
receptacles for that purpose.

6. Tenant shall not alter any lock or install new or additional  locks or bolts,
without Landlord's consent,  not to be unreasonably  withheld,  conditioned,  or
delayed.

7. Tenant shall be responsible  for the  inappropriate  use of any toilet rooms,
plumbing  or  other  utilities.  No  foreign  substances  of any  kind are to be
inserted therein.

8.  Tenant  shall not deface  the walls,  partitions  or other  surfaces  of the
premises or Building.

9.  Tenant  shall not suffer or permit any thing in or around  the  Premises  or
Building  that causes  excessive  vibration or floor  loading in any part of the
Building.

10. Furniture,  significant  freight and equipment shall be moved into or out of
the building only with the Landlord's knowledge and consent,  without Landlord's
consent, not to be unreasonably withheld,  conditioned,  or delayed, and subject
to such reasonable  limitations,  techniques and timing, as may be designated by
Landlord.  Tenant shall be  responsible  for any damage to the Building  arising
from any such activity.

11. Tenant shall not employ any service or contractor for services or work to be
performed in the Building, except as approved by Landlord.

12.  Landlord  reserves the right to close and lock the  Building on  Saturdays,
Sundays and legal holidays, and on other days between the hours of 6:00 P.M. and
7:00 A.M. of the following day. If Tenant uses the Premises during

                                       37
<PAGE>

such periods,  Tenant shall be responsible for securely  locking its suite door.
Tenant shall have access to Building 24 hours per day, seven days a week.

13. Tenant shall return all keys at the  termination of its tenancy and shall be
responsible for the cost of replacing any keys that are lost.

14. No window coverings, shades or awnings shall be installed or used by Tenant,
without Landlord's consent,  not to be unreasonably  withheld,  conditioned,  or
delayed.

15.  Neither Tenant nor any employee or invitee of Tenant shall go upon the roof
of the Building.

16.  Tenant shall not suffer or permit  smoking or carrying of lighted  cigar or
cigarettes  in  areas  reasonably   designated  by  Landlord  or  by  applicable
governmental agencies as non-smoking areas.

17.  Tenant  shall not use any  method of heating  or air  conditioning  without
Landlord's consent, not to be unreasonably withheld, conditioned, or delayed.

18. The Premises shall not be used for lodging or  manufacturing.  Cooking shall
be by microwave oven only.

19.  Tenant  shall  comply  with all  safety,  fire  protection  and  evacuation
regulations established by Landlord or any applicable governmental agency.

20.  Landlord  reserves the right to waive anyone of these rules or regulations,
and/or as to any particular  lessee,  and any such waiver shall not constitute a
waiver of any other rule or regulation or any subsequent  application thereof to
such Tenant.

21.  Tenant  assumes  all risks from theft or  vandalism  and agrees to keep its
Premises locked as may be required.

22.  Landlord  reserves  the  right to make  such  other  reasonable  rules  and
regulations  as it may from  time to time  deem  necessary  for the  appropriate
operation and safety of the Building and its  occupants.  Tenant agrees to abide
by such rules and regulations as well as these rules and regulations, subject to
the limitations on such rules and regulations as provided in the Lease.

                                       38
<PAGE>

                                    EXHIBIT C

                               TENANT IMPROVEMENTS

1. Landlord shall provide a Tenant  Improvement  ("TI")  allowance of $32.50 per
rentable  square foot to be used at the discretion of the Tenant.  The allowance
does not include the basement/vault square footage.

2.  Tenant may  reallocate  or transfer  the TI  allowance,  as desired,  to the
various leased areas of the Premises.

3.  Payment of the TI allowance  by Landlord  shall be on a monthly  basis (upon
receipt of invoices from Tenant  reasonably  documenting its  expenditures)  and
shall correspond to or match the immediately upcoming new space occupancy by the
Tenant.  TI Payment for  up-fits,  excluding  the 6th and 7th  floors,  shall be
available to the Tenant as  expenditures  occur after the full  execution of the
Lease.  TI allowance for the 6th and 7th Floors shall be provided only as design
and construction of these floors begin.

4. Any  un-used  TI  allowance  shall be  applied  as credit to future  Premises
up-fits or returned to Tenant upon  written  request (but no earlier than thirty
(30) days following the Commencement Date).

5. Tenant  accepts  Premises in  accordance  with the Lease  provisions  and any
improvements  to the  Premises  (or  activities  incidental  thereto)  shall  be
eligible for reimbursement from the TI allowance, including, but not limited to:
design  drawings,  architectural  services,  engineering  services,  permitting,
document  copying,  bidding,   demolition,   waste  removal,  new  construction,
additions/removal  or  modifications  to the electrical,  HVAC, fire protection,
sewer  and  water,   and   communications,   elevator   lock-out   and  security
installations,  window  treatment and shading (except window film replacement as
stated in Paragraph  6.3(b),  which shall be provided  separately  by Landlord),
modifications  to common  area(s) or other  Premises  required by Tenant Up-fit,
mark-up of Construction cost if Tenant requests Landlord to provide construction
Project  management.  Landlord  shall  cooperate (at no cost to Tenant) with all
reasonable   Tenant  requests  to  execute  permit   applications   and  similar
ministerial acts.

6. Tenant  shall  choose its' own design and  construction  team.  Tenant  shall
designate the construction  Project Manager and Landlord will designate a single
Point of Contact to interact with the Project Manager.  Tenant's Project Manager
duties  shall  include  endeavoring  to keep the project on schedule  and taking
commercially  reasonable  precautions  to protect the  Building  from damages or
abuse during  construction.  All work  activities  that may  materially  hinder,
damage or otherwise  impact the Building or its day-to-day  operations  shall be
initiated and completed based on the reasonable concurrence and agreement by the
Project Manager and Point of Contact person.  As a minimum,  Project Manager and
Point of Contact person shall meet twice a week on-site during  construction  to
monitor activities.

7. The General Contractor shall have a full-time on-site Project manager.

8. Tenant  shall  endeavor to provide  initial  space  occupancy  (for  business
purposes)  on or about  April 1, 2006,  including:  completion  of  construction
drawings,  submittal to the City of Raleigh for permit  review and  selection of
the General Contractor by approximately  December 15, 2005; completion of up-fit
demolition,  receipt of the construction permit and start-up of the installation
up-fits by  approximately  February 1, 2006,  and;  completion  of up-fits on or

                                       39
<PAGE>

about April 1, 2006. Tenant agrees to take all commercially  reasonable  efforts
to meet this schedule,  and agrees to designate the Occupancy Date (for business
purposes) as April 1, 2006,  subject to extension only as expressly  provided in
the Lease.

9.  Tenant  Improvements  shall be  designed  and  constructed  in a manner that
maintains   substantial   consistency   in  appearance  and  finishes  in  areas
interfacing  or exposed to common  areas.  The design and  construction  of such
areas  shall be  reviewed  and  approved  by the  Landlord,  with  Landlord  not
unreasonably  withholding,  delaying,  or conditioning  approval.  This excludes
up-fit  of  fully  occupied  floors  by  Tenant.   Tenant  shall  provide  HVAC,
electrical,  fire  protection,  safety  and  plumbing  design  and  construction
consistent  with  building  standards,  and shall  allow  Landlord a  reasonable
opportunity to review and inspect these items during design and construction.

                                       40
<PAGE>

                                    EXHIBIT D

                              ADDITIONAL PROVISIONS

1.  Naming  Rights:  The lease  rate and  amount of square  footage in the lease
provides exclusive Tenant naming rights for the building.  Naming rights will be
granted upon lease signing.  All costs associated with implementing the building
name change,  including the installation of signage,  will be a Tenant cost. The
new building  name will be agreed upon by both Tenant and  Landlord.  Tenant may
place  appropriate  signage  (building name and/or Tenant logo) on the north and
south  faces of the  building  near  the top and at the  building  entrances  on
Fayetteville and Davie Streets, with size and configuration contingent upon City
of Raleigh  approval.  Tenant has tentatively  selected the new building name as
"Capital Bank Plaza", which is acceptable to the Landlord. Tenant may assign the
naming rights to a successor  company,  subject to Landlord's  written  consent,
which shall not be unreasonably withheld, conditioned or delayed.

2.  Vaults/ATM/Safe:  Landlord shall lease the basement vault and the contiguous
open space (a total of 3,314  rentable  square  feet) to the Tenant,  which will
enable Tenant to establish security while using the vault.  Tenant shall provide
all costs and  expenditures  to up-fit the vault and open space  (including  any
additional security measures, ventilation,  electronics, and reactivation of the
vault doors), service and maintain the vault and adjoining space. Two additional
vaults are located in Tenant  Premises  (one on the 2nd floor and one on the 3rd
floor);  it shall be the Tenant's  responsibility  to service and maintain those
vaults as well as the installation of any electronics or ventilation that may be
required.  Tenant,  at Tenant's sole cost, will have the right to install an ATM
kiosk and safe at a location reasonably acceptable to Landlord.

3. Dedicated Private Elevator:  Landlord shall provide Tenant with exclusive use
of a private  elevator that operates  between the basement vault area, the lobby
level,  the 2nd  floor  and the 3rd  floor.  Tenant  shall  be  responsible  for
operating,  servicing  and  maintaining  the private  elevator.  Landlord,  upon
request,  shall provide Tenant with the ability to "lock-out"  this elevator for
certain  floors or  "lock-out"  the  building's  common  elevators for requested
floors,  with the  costs  of  "lock-out"  installation  included  in the  Tenant
Improvement Allowance.

                                       41
<PAGE>

4. Fair Market Rental: "Fair Market Rental" shall mean ninety-five percent (95%)
of the fair  market Base Rent,  taking into  account the cash value of free rent
and  leasehold  improvements,  which  non-equity  tenants are then  receiving in
connection  with a lease for comparable  space within a three (3) mile radius of
the  Building.  Promptly  following  receipt by Landlord  of Tenant's  notice to
exercise its expansion option,  Landlord shall notify Tenant of the amount that,
in Landlord's  reasonable  opinion,  represents the Fair Market  Rental.  Within
fifteen  (15) days of such  notice,  (a) if Tenant  agrees,  Tenant shall notify
Landlord that Tenant so agrees that the Base Rent therein  provided  constitutes
the Fair Market Rental,  or (b) if Tenant disagrees with the Fair Market Rental,
Tenant shall specify what Base Rent, in Tenant's  opinion,  constitutes the Fair
Market Rental ("Tenant's Base Rent Notice"),  or (c) if Tenant does not respond,
Tenant  shall be deemed to agree with  Landlord's  determination  of Fair Market
Rental.  In the event Tenant agrees,  then the Base Rent set forth in Landlord's
said  notice  shall be deemed the lesser of the  current  lease rate or the Fair
Market  Rental.  In the event Tenant  disagrees as provided in clause (b) above,
the following procedure shall be used in determining the Fair Market Rental: The
parties  shall use due diligence to attempt to agree upon the Fair Market Rental
within seven (7) business days following the foregoing  fifteen (15) day period,
but, if they do not so agree,  then at the request of either  party to the other
(the "Initial  Request"),  the parties shall  jointly  choose an impartial  real
estate broker (who shall have had at least ten (10) years experience as a broker
in  commercial  office  leasing  within a three (3) mile radius of the Building,
whose decision shall be final and binding. If the parties do not agree upon such
a third party  broker and notify in writing the other  thereof  within seven (7)
business days of the Initial  Request,  then within six (6) additional  business
days  each  party  shall  choose a real  estate  broker  (having  the  foregoing
credentials) and notify in writing the other thereof,  and the joint decision of
such real estate brokers regarding fair market rental shall be final and binding
(or, failing such notice, or if such choice is made, failing notice to the other
within such six (6)  additional  business  day period,  the decision of one such
real estate broker timely chosen and noticed shall be final and binding). If the
two (2) real estate  brokers timely chosen and noticed do not agree within seven
(7) business days of the end of the six (6) business day period  mentioned above
during which they were  chosen,  then they shall choose a third such real estate
broker (having the foregoing credentials) within five (5) business days, and the
decision of such third real estate broker  regarding fair market rental shall be
final and binding.

5. Capital Bank Financing:  Tenant shall provide the Landlord with the following
Building re-financing and Line-of-credit  (subject to separate written agreement
between Landlord and Tenant).

a) Re-Finance Current Building Loan.
   --------------------------------

            Amount:     $7,910,000

            Terms:      A fixed  interest rate of 6.75% for a period of 10 years
                        and no origination fee, with interest only for the first
                        5 years and P&I during the next five years based on a 25
                        year amortization. The loan shall have a balloon payment
                        at the end of 10 years.

b) Line-of-Credit for TI
   ---------------------

            Amount:     The line-of-credit shall cover the original Capital Bank
                        TI ($1,799,167)  plus other near-term TI expenditures by
                        Capital  Bank due to  expansion  and other  new  tenants
                        ($1,000,000),  for  a  total  line-of-credit  amount  of
                        $2,800,000.

            Terms:      Interest  only,  at Prime  minus  1/2  percent,  with no
                        origination fee.

*NOTE:  Landlord  shall have the right to satisfy  and replace one or both loans
with  permanent  financing  at any  point  in the  future,  in  Landlord's  sole
discretion and without penalty.

6. Security:  Landlord  provides a security guard during normal  business hours,
and the  building  has  lock-out  and  security  swipe card entry  after  hours.
Additional  security  required  by Tenant will be a  responsibility  and cost to
Tenant.

                                       42
<PAGE>

7. Communications:  The building is wired for Broad Band Internet Service, which
is provided by Windchannel Communications, a tenant in the building.

8.  Building  Management:  RDC  Property  Management,  an  affiliate  of Raleigh
Development  Company,  manages the  building.  RDC Property  Management  has its
primary office at 333 Corporate Plaza, Suite 100, Raleigh, North Carolina 27601,
and shall have said office open during normal  business  hours and be reasonably
accessible to Tenant.

                                       43
<PAGE>

                                    EXHIBIT E

                               SNDA SPECIMEN FORM

                          SUBORDINATION, ATTORNMENT AND
                            NON-DISTURBANCE AGREEMENT

THIS  SUBORDINATION,  ATTORNMENT AND  NON-DISTURBANCE  AGREEMENT  ("Agreement"),
entered into as of ______________________, by ______________________ ("Tenant"),
and ___________________________ ("Bank").

I. Tenant is the lessee under  certain  leases  described  on  Attachment 1 (the
leases and all modifications, amendments, extensions, renewals, replacements and
substitutions  thereto or therefor,  the "Leases"),  which Leases cover all or a
portion of the real property described on Attachment 1 (the "Property").

II.  Bank  has  extended  or  has  committed  to  extend   credit   ("Loan")  to
____________________________,  which Loan is or will be secured by the lien of a
mortgage,  deed to  secure  debt,  security  deed,  trust  deed or deed of trust
encumbering the Property (the "Mortgage").

III. The Mortgage is dated  ________________________  and recorded in Book _____
at Page  _____,  of the  Office  of the  Register  of  Deeds,  or other  similar
recording office, in the State and County indicated above.

IV. Bank requires that Tenant enter into this Agreement.

NOW, THEREFORE, in consideration of One Dollar in hand paid by each party to the
other, the covenants contained herein and other good and valuable consideration,
the receipt and sufficiency of which is hereby  acknowledged,  the parties agree
as follows:

      1. Subordination of Leases.  The Leases and all terms thereof,  including,
         -----------------------
without  limitation,  any options to purchase,  rights of first  refusal and any
similar rights, are and shall be subject and subordinate to the Mortgage, and to
all  amendments,   modifications,   extensions,   renewals,   replacements   and
substitutions  thereof  or  therefor,  to the  full  extent  of  the  principal,
interest, fees, charges, costs and expenses (to include attorneys' fees, fees of
legal assistants and fees of other  professionals  as provided  therein) and all
other amounts now or hereafter secured thereby.

      2. Joinder in Foreclosure.  In the event Bank elects to foreclose or cause
         ----------------------
the  foreclosure of the Mortgage,  Bank will not join, nor will any other person
on behalf of Bank join Tenant in summary or  foreclosure  proceedings as long as
(1) Tenant has not amended, modified, replaced or substituted the Leases without
Bank's prior written consent and (2) Tenant is not in default under the Leases.

      3. Succession to Interest of Landlord;  Nondisturbance.  In the event that
         ---------------------------------------------------
Bank shall  succeed to the interest of the lessor or landlord  under the Leases,
or any other  person  shall  succeed to the  interest  of the lessor or landlord
under the Leases either directly or through Bank on account of or by virtue of a
foreclosure  under the Mortgage,  or a deed-in-lieu  of  foreclosure,  and there
exists no default by Tenant under the Leases (beyond any applicable cure period)
and Tenant has not amended, modified, replaced or substituted the Leases without
Bank's  prior  written  consent,  Bank or such other  person who succeeds to the
interest  of the lessor or  landlord  directly  or through  Bank on account of a
foreclosure or a deed-in-lieu of foreclosure, agrees not to disturb or otherwise
interfere  with  Tenant's  possession  of the portion of the Property  leased by
Tenant  pursuant to the Leases for the  unexpired  term of the Leases,  provided
that Bank and such other successor person as aforesaid, (1) shall be liable only
for the duties and obligations of the "landlord" under the Leases accruing after
the taking of  possession as aforesaid and for the period that each is severally
the "landlord" under the Leases and (2) shall not be:

            (a) liable for any act or omission of any other  lessor or landlord,
      or any other person under the Leases;

                                       44
<PAGE>

            (b)  subject to any  offsets or  defenses  which  Tenant  might have
      against any lessor or landlord, or any other person under the Leases;

            (c) bound by any rent or  additional  rent which  Tenant  might have
      paid for more than thirty (30) days in advance to any lessor or  landlord,
      or other person,  unless the same was paid to Bank or such other successor
      person to Bank as aforesaid;

            (d)   bound  by  any   amendment,   modification,   replacement   or
      substitution of the Leases made without Bank's prior written consent; or

            (e)  liable  for any  security  deposit  Tenant  might have paid any
      lessor  or  landlord,  or other  person,  except  to the  extent  Bank has
      actually received said security deposit.

      4.  Attornment  by Tenant.  Upon Bank  succeeding  to the  interest of the
          ---------------------
lessor or  landlord  under the Leases,  or any other  person  succeeding  to the
interest of the lessor or landlord  under the Leases either  directly or through
Bank on  account  of or by virtue of a  foreclosure  under  the  Mortgage,  or a
deed-in-lieu of foreclosure,  Tenant  covenants and agrees (1) to attorn to Bank
or any other person  succeeding to the interest of  "landlord"  under the Leases
either  directly  or through  Bank on  account of or by virtue of a  foreclosure
under the Mortgage,  or a deed-in-lieu of foreclosure,  (2) to recognize Bank or
such other  successor  as Tenant's  "landlord"  under the Leases,  and (3) to be
bound by and perform all of the obligations  and conditions  imposed upon Tenant
by the  Leases,  provided  that  Bank or  other  successor  person  assumes  all
obligations of Landlord thereunder. If requested by Bank or any subsequent owner
of the Property as aforesaid,  Tenant shall execute a new lease for a term equal
to the remaining term of the Leases and otherwise containing the same provisions
and covenants of the Leases.

      5. Tenant's Representation and Warranty. Tenant represents and warrants to
         ------------------------------------
Bank that there has been no  assignment of Tenant's  rights and interests  under
the Leases to any person and no sublease or other agreement  covering the leased
premises has been entered into by Tenant.

      6. Tenant's Additional Covenants and Agreements.
         --------------------------------------------

            (a)  Insertion  of  Mortgage  Information.  Tenant  agrees  that the
                 ------------------------------------
      recording information for the Mortgage may be written on this Agreement at
      the time  this  Agreement  is  recorded  or at such  other  time as may be
      appropriate,  and  such  insertion  shall  not  negate,  or  adversely  or
      negatively effect the validity and enforceability of this Agreement.

            (b) No Amendment  or  Modification.  Tenant  agrees that it will not
                ------------------------------
      amend,  modify,  replace or  substitute  the Leases,  or any part thereof,
      without Bank's prior written consent.

            (c) No Alterations or  Improvements.  Tenant agrees that it will not
                -------------------------------
      make to that  portion  of the  Property  leased by it under the Leases any
      alterations,  improvements  or changes  that would  cause the value of the
      Property to diminish or the utility or current  usefulness of the Property
      to be diminished, without the prior written consent of Bank.

            (d) Payment of Rents to Bank. Tenant,  recognizing and acknowledging
                ------------------------
      that the lessor or landlord  under the Leases has  assigned or will assign
      to Bank the rents and profits from the Property, and Tenant agrees that it
      will pay to Bank,  on written  demand,  all rental  payments or other sums
      required to be paid by Tenant under the Leases.

            (e)  Notice and Right to Cure  Defaults.  Prior to  terminating  the
                 ----------------------------------
      Leases  due to a default  by the  lessor or  landlord  thereunder,  Tenant
      agrees to notify  Bank of such  default and give Bank the  opportunity  to
      cure such default within thirty (30) days of Bank's receipt of such notice
      (or, if such default  cannot  reasonably  be cured within such thirty (30)
      day period,  Bank shall have such longer time as may be necessary  (not ot
      exceed sixty (60) days) to cure the default;  provided that Bank commences
      the cure within such period and diligently pursues the cure thereafter).

      7.  Limitation  of  Liability.  Notwithstanding  anything to the  contrary
          -------------------------
contained herein, the shareholders,  directors,  officers, employees, agents and
other  representatives  of Bank shall not have any personal  liability to Tenant
and the liability of Bank to Tenant, in any event, shall not exceed and shall be
limited to Bank's interest in that portion  (including rental income,  insurance
and  condemnation  proceeds) of the Property  that is subject to the Leases.  If
Bank  becomes the  "landlord"  under the Leases,  after it conveys its  interest
under the Leases and no longer is the "landlord"  thereunder,  Bank shall not be
liable for any unperformed covenant, duty or obligation of "landlord" thereafter
accruing.

                                       45
<PAGE>

8.    Miscellaneous.
      -------------

      (a) Incorporation of Exhibits.  The Mortgage and all exhibits,  schedules,
          -------------------------
addenda  and  other   attachments  to  this  Agreement  are  by  this  reference
incorporated  herein and made a part hereof as if fully set forth in the body of
this Agreement.

      (b) No Oral Change.  This  Agreement  can be amended or modified only in a
          --------------
writing duly executed by the parties hereto.

      (c) Notices. All notices,  certificates and other communications hereunder
          -------
shall be deemed  given when mailed by  registered  or  certified  mail,  postage
prepaid,  return receipt requested,  addressed to the addresses set forth above.
Bank and Tenant may, by written  notice given  hereunder,  designate a different
address where communications should be sent.

      (d) Number and Gender. Whenever the context may require, any pronouns used
          -----------------
herein shall include the corresponding masculine,  feminine or neuter forms, and
the singular form of nouns and pronouns shall include the plural and vice versa.
Words  importing  persons  include  firms,  companies,   associations,   general
partnerships,  limited  partnerships,  limited liability  partnerships,  limited
liability limited partnerships,  limited liability companies,  trusts,  business
trusts,  corporations  and legal  entities,  including  public and  quasi-public
bodies, as well as individuals.

      (e) Successors and Assigns. This Agreement shall be binding upon and inure
          ----------------------
to the benefit of the respective heirs, personal representatives,  successors or
assigns of the parties hereto.

      (f) Term of Agreement.  The terms and provisions of this  Agreement  shall
          -----------------
terminate upon the  cancellation  of record of the Mortgage,  unless the same is
earlier  terminated by a termination  agreement executed and delivered to Tenant
by Bank.

      (i)

                       (Signatures Begin on the Next Page)

                                       46
<PAGE>

The undersigned  have executed this Agreement as of the day and year first above
stated.

                                        --------------------------

                                        By:
                                           -------------------------------------
                                                 _____________, President
ATTEST:

------------------------------
______________, Secretary

STATE OF NORTH CAROLINA
COUNTY OF
         ---------------------

I,  __________________________________,  a Notary Public of the County and State
aforesaid, certify that ____________________  personally came before me this day
and acknowledged that he is ____________________ of ________________________,  a
_______________________________________,  and that by authority given and as the
act of said company, the foregoing instrument was signed in its name by him.

      Witness my hand and official stamp or seal, this the day of , 2004.

                                  Notary Public

My Commission Expires:
                      -----------------------------------------------

                                       47
<PAGE>

                                  ATTACHMENT 1

            (Subordination, Attornment and Non-disturbance Agreement)

      (a)  Description  of  Leases   (include  all  amendments,   modifications,
extensions,  renewals, replacements and substitutions;  and include any recorded
memorandum of lease or recording information for lease if lease recorded):

                 ----------------------------------------------

Lease Agreement  dated  __________ by and between  ________________________,  as
lessor, and Tenant, as lessee.

5. Description of Property  (describe below or attach  description and reference
attachment below):

                        (Description of Leased Premises)

                                       48

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