Document:

<PAGE>

                          FIRST AMENDMENT TO LEASE

THIS FIRST AMENDMENT TO LEASE IS MADE EFFECTIVE AS OF MARCH 1, 1995 BY AND
BETWEEN FALLBROOK MERCANTILE, A CALIFORNIA GENERAL PARTNERSHIP ("LANDLORD")
AND FALLBROOK NATIONAL BANK ("TENANT") WITH REFERENCE TO THE FACTS SET FORTH
BELOW.

RECITALS
--------

A.    Landlord and Tenant are parties to that certain lease dated
      March 1, 1994, and hereby express their mutual desire and intent to
      amend the terms of the Lease by this First Amendment to Lease with
      those terms, covenants, and conditions as hereinafter provided.

B.    Landlord leased to Tenant a certain retail space consisting of
      approximately 8,272 square feet identified as 855-I, J, K, L, M, N, and
      O South Main Avenue, Fallbrook, California 92028 (the "Premises").

C.    Landlord and Tenant desire to amend and modify the lease document
      effective April 1, 1995.

NOW, THEREFORE, IN CONSIDERATION OF THE RECITALS AND FOR OTHER GOOD AND
VALUABLE CONSIDERATION, THE RECEIPT AND SUFFICIENCY OF WHICH ARE HEREBY
ACKNOWLEDGED, THE PARTIES HERETO AGREE TO SET FORTH BELOW.

1.   SECTION 1.4 shall now read, "the original location of the Premises was
     outlined in red on the site plan of the Shopping Center, attached to the
     original Lease as Exhibit "A" and made a part thereof." The Landlord and
     Tenant are now amending the Lease to eliminate Suite 855-I South Main
     Avenue, Fallbrook, California 92028 from the Lease premises. Therefore,
     the revised Premises shall otherwise be known as 855-J, K, L, M, N, and O
     South Main Avenue, Fallbrook, California 92028 ("Address"). Said Premises
     being agreed to for the purposes of this Lease to be reduced by
     eliminating 855-I South Main Avenue, Fallbrook, California 92028 and
     thereby reducing the overall square footage by 1,300 square feet,
     resulting in a total approximate area of the new Premises of 6,972 square
     feet.

2.   SECTION 1.11(a) - MINIMUM MONTHLY RENT shall be Seven Thousand Six
     Hundred Sixty-Nine Dollars and Twenty Cents ($7,669.20) per month for
     the period of April 1, 1995 through March 31, 1996, and shall be
     increased pursuant to Section 1.11(a) of the Lease Agreement.

3.   SECTION 11.1(b) - OTHER PERIODIC PAYMENTS shall be Two Thousand Two
     Hundred Thirty-One Dollars and Four Cents ($2,231.04).

4.   Except as modified herein, the Lease shall remain in full force and
     effect as modified.

IN WITNESS WHEREOF THIS AMENDMENT TO LEASE IS EXECUTED AS OF THE DATE FIRST
WRITTEN ABOVE.

LANDLORD:  FALLBROOK MERCANTILE
           A California Partnership

By:  /s/ Robert W. Carson
    -----------------------------------
    Robert W. Carson, General Partner

By:  /s/ Michael R. Perry
    -----------------------------------
    Michael R. Perry, General Partner

TENANT:   FALLBROOK NATIONAL BANK
          A California Corporation

By:  [ILLEGIBLE]
    -----------------------------------

Its:   President/CEO
    -----------------------------------

By:  [ILLEGIBLE]
    -----------------------------------

Its:   Senior Vice President
    -----------------------------------

<PAGE>

                         STANDARD SHOPPING CENTER LEASE

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

           SHOPPING CENTER:

                           FALLBROOK MERCANTILE
           --------------------------------------------------

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

           TENANT:

                           FALLBROOK NATIONAL BANK
           --------------------------------------------------

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

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

<PAGE>

                              TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                            Page
<S>                                                                      <C>
ARTICLE 1.       GRANT AND BASIC TERMS.........................................1

    SECTION 1.1      EFFECTIVE DATE OF LEASE...................................1
    SECTION 1.2      LANDLORD..................................................1
    SECTION 1.3      TENANT....................................................1
    SECTION 1.4      PREMISES..................................................1
    SECTION 1.5      LENGTH OF TERM............................................1
    SECTION 1.6      COMMENCEMENT OF TERM......................................1
    SECTION 1.7      ACKNOWLEDGEMENT OF COMMENCEMENT DATE......................1
    SECTION 1.8      PERMITTED USES............................................1
    SECTION 1.9      TENANT'S GUARANTOR........................................1
    SECTION 1.10     INITIAL SECURITY DEPOSIT..................................2
    SECTION 1.11     RENT AND OTHER CHARGES PAYABLE BY TENANT..................2
    SECTION 1.12     EXCUSE OF LANDLORD'S PERFORMANCE..........................2
    SECTION 1.13     RIDERS....................................................2

ARTICLE II.      LEASE TERM....................................................2

    SECTION 2.1      LEASE OF PREMISES FOR LEASE TERM..........................2
    SECTION 2.2      DELAY IN COMPLETION.................................DELETED
    SECTION 2.3      EARLY OCCUPANCY...........................................2
    SECTION 2.4      HOLDING OVER..............................................2
    SECTION 2.5      SURRENDER OF PREMISES.....................................2
    SECTION 2.6      SUCCESSORS................................................3

ARTICLE III.     MINIMUM MONTHLY RENT..........................................3

    SECTION 3.1      TIME AND MANNER OF PAYMENT................................3
    SECTION 3.2      COST OF LIVING INCREASES..................................3
    SECTION 3.3      PERCENTAGE RENT.....................................DELETED
    SECTION 3.4      GROSS RECEIPTS DEFINED..............................DELETED
    SECTION 3.5      SECURITY DEPOSIT INCREASES..........................DELETED
    SECTION 3.6      TERMINATION; ADVANCE PAYMENTS.............................3

ARTICLE IV.      OTHER CHARGES PAYABLE BY TENANT...............................3

    SECTION 4.1      ADDITIONAL RENT...........................................3
    SECTION 4.2      REAL PROPERTY TAXES.......................................3
                     (a) PAYMENT OF TAXES......................................3
                     (b) DEFINITION OF "REAL PROPERTY TAX."....................4
                     (c) TENANT'S RIGHT TO CONTEST TAXES.......................4
    SECTION 4.3      PERSONAL PROPERTY TAXES...................................4
    SECTION 4.4      UTILITIES.................................................4
    SECTION 4.5      COST OF MAINTENANCE OF COMMON AREAS.......................5
                     (a) TENANT TO BEAR PRO RATA SHARE OF EXPENSE..............5
                     (b) OPERATING COST........................................5
    SECTION 4.6      INSURANCE PREMIUMS........................................5
                     (a) LIABILITY INSURANCE...................................5
                     (b) HAZARD AND RENTAL INCOME INSURANCE....................5
                     (c) INSURANCE OF IMPROVEMENTS.............................6
                     (d) PAYMENT OF PREMIUMS; INSURANCE POLICIES...............6
                     (e) INCREASE IN FIRE INSURANCE PREMIUM....................6
                     (f) PLATE GLASS...........................................6
                     (g) BOILER INSURANCE................................DELETED
                     (h) WAIVER OF SUBROGATION.................................6
                     (i) FORM OF POLICIES......................................6
    SECTION 4.7      INTEREST ON PAST DUE OBLIGATIONS..........................7
    SECTION 4.8      IMPOUNDS FOR OPERATING COSTS..............................7

ARTICLE V.       RECORDS AND BOOKS OF ACCOUNT............................DELETED

ARTICLE VI.      AUDIT...................................................DELETED

                                      (i)
<PAGE>

ARTICLE VII.     CONSTRUCTION OF PREMISES......................................7

    SECTION 7.1      LANDLORD AND TENANT IMPROVEMENTS..........................7
    SECTION 7.2      PARKING FACILITIES........................................7
    SECTION 7.3      CHANGES AND ADDITIONS TO BUILDINGS........................7
    SECTION 7.4      FINANCING...........................................DELETED
    SECTION 7.5      RIGHT TO ADJUST.....................................DELETED

ARTICLE VIII.    USE OF PROPERTY...............................................8

    SECTION 8.1      PERMITTED USES............................................8
    SECTION 8.2      MANNER OF USE.............................................8
                     (a) INTERFERENCE WITH USE/NUISANCE........................8
                     (b) VIOLATION OF LAW/INSURANCE PROVISIONS.................8
                     (c) PERMITS...............................................8
                     (d) STORE OPERATION.......................................8
                     (e) CHANGE OF NAME........................................8
                     (f) SOLICITATION OF BUSINESS..............................8
    SECTION 8.3      COMPETITION.........................................DELETED
    SECTION 8.4      INDEMNIFICATION OF LANDLORD...............................8
    SECTION 8.5      LANDLORD'S ACCESS.........................................9
    SECTION 8.6      EXCAVATION................................................9
    SECTION 8.7      QUIET POSSESSION..........................................9
    SECTION 8.8      WINDOW COVERINGS..........................................9

ARTICLE IX.      PARKING AND COMMON USE AREAS AND FACILITIES...................9

    SECTION 9.1      CONTROL OF COMMON AREAS BY LANDLORD.......................9
    SECTION 9.2      TENANT'S RIGHT TO USE.....................................9
    SECTION 9.3      MERCHANTS' ASSOCIATION..............................DELETED

ARTICLE X.       SIGNS, AWNINGS, CANOPIES,
                 FIXTURES, ALTERATIONS, IMPROVEMENTS..........................10

    SECTION 10.1     SIGNS AND AUCTIONS.......................................10
    SECTION 10.2     INSTALLATION BY TENANT...................................10
    SECTION 10.3     IMPROVEMENTS........................................DELETED
    SECTION 10.4     NONREMOVAL BY TENANT.....................................10
    SECTION 10.5     REMOVAL AND RESTORATION..................................10
    SECTION 10.6     LIENS....................................................10
    SECTION 10.7     SIGNS, AWNINGS AND CANOPIES..............................10

ARTICLE XI.      CONDITIONS OF PROPERTY;
                 MAINTENANCE, REPAIRS AND ALTERATIONS.........................11

    SECTION 11.1     EXISTING CONDITIONS......................................11
    SECTION 11.2     EXEMPTION OF LANDLORD FROM LIABILITY; WAIVER.............11
    SECTION 11.3     TENANT'S OBLIGATIONS.....................................11
    SECTION 11.4     LANDLORD'S OBLIGATIONS...................................11
    SECTION 11.5     RULES AND REGULATIONS....................................12
    SECTION 11.6     CONDITION UPON TERMINATION...............................12

ARTICLE XII.     DAMAGE OR DESTRUCTION........................................13

    SECTION 12.1     PARTIAL DAMAGE TO LEASED PREMISES........................13
    SECTION 12.2     TOTAL OR SUBSTANTIAL DESTRUCTION.........................13
    SECTION 12.3     PARTIAL DESTRUCTION OF SHOPPING CENTER...................13
    SECTION 12.4     UNINSURED CASUALTY.......................................14
    SECTION 12.5     LANDLORD'S OBLIGATIONS...................................14
    SECTION 12.6     TEMPORARY REDUCTION OF RENT..............................14
    SECTION 12.7     WAIVER...................................................14

ARTICLE XIII.    CONDEMNATION.................................................14

    SECTION 13.1     TOTAL CONDEMNATION.......................................14
    SECTION 13.2     TOTAL CONDEMNATION OF PARKING AREA.......................14
    SECTION 13.3     PARTIAL CONDEMNATION.....................................14
    SECTION 13.4     PARTIAL CONDEMNATION OF PARKING AREA.....................15
    SECTION 13.5     CONDEMNATION OF LESS THAN A FEE..........................15
    SECTION 13.6     DISTRIBUTION OF CONDEMNATION AWARD.......................15

                                    (ii)

<PAGE>

ARTICLE XIV.       ASSIGNMENT AND SUBLETTING............................15

     Section 14.1        LANDLORD'S CONSENT REQUIRED....................15
     Section 14.2        GRANT OF CONCESSIONS;
                         CONDITIONS TO GRANT............................16
     Section 14.3        NO RELEASE OF TENANT...........................16
     Section 14.4        LANDLORD'S ELECTION............................16
     Section 14.5        NO MERGER......................................16
     Section 14.6        ASSIGNMENT FEES AND PROCEDURES.................16

ARTICLE XV.        DEFAULTS; REMEDIES...................................16

     Section 15.1        COVENANTS AND CONDITIONS.......................16
     Section 15.2        DEFAULTS.......................................16
     Section 15.3        DEFAULT BY LANDLORD............................17
     Section 15.4        REMEDIES.......................................17
     Section 15.5        THE RIGHT TO RELET THE PREMISES................18
     Section 15.6        WAIVER OF RIGHTS OF REDEMPTION.................18
     Section 15.7        CUMULATIVE REMEDIES............................18
     Section 15.8        LATE CHARGES...................................18

ARTICLE XVI.       PROTECTION OF CREDITORS..............................18

     Section 16.1        SUBORDINATION..................................18
     Section 16.2        ATTORNMENT.....................................19
     Section 16.3        SIGNING OF DOCUMENTS...........................19
     Section 16.4        ESTOPPEL CERTIFICATES..........................19
     Section 16.5        TENANT'S FINANCIAL CONDITION..............DELETED
     Section 16.6        MORTGAGE PROTECTION CLAUSE.....................19

ARTICLE XVII.      LEGAL COSTS..........................................19

     Section 17.1        LEGAL PROCEEDINGS..............................19
     Section 17.2        LANDLORD'S CONSENT.............................19

ARTICLE XVIII.     MISCELLANEOUS PROVISIONS.............................19

     Section 18.1        NON-DISCRIMINATION.............................19
     Section 18.2        LANDLORD'S LIABILITY; CERTAIN DUTIES...........20
     Section 18.3        SEVERABILITY...................................20
     Section 18.4        INTERPRETATION.................................20
     Section 18.5        ENTIRE AGREEMENT...............................20
     Section 18.6        NOTICES........................................20
     Section 18.7        WAIVERS........................................20
     Section 18.8        NO RECORDATION.................................20
     Section 18.9        BINDING EFFECT; CHOICE OF LAW..................20
     Section 18.10       CORPORATE AUTHORITY;
                         PARTNERSHIP AUTHORITY..........................20
     Section 18.11       NO PARTNERSHIP.................................21
     Section 18.12       JOINT AND SEVERAL LIABILITY....................21
     Section 18.13       FORCE MAJEURE..................................21
     Section 18.14       NO OPTION......................................21
     Section 18.15       ACCORD AND SATISFACTION........................21
     Section 18.16       PROVISIONS ARE COVENANTS
                         AND CONDITIONS.................................21
     Section 18.17       UNION WORKERS.............................DELETED
     Section 18.18       REMODEL........................................21
     Section 18.19       OPTION TO EXTEND..........................DELETED
</TABLE>

                                    (iii)
<PAGE>

                        STANDARD SHOPPING CENTER LEASE

                                  ARTICLE I
                            GRANT AND BASIC TERMS

      This Article One contains the Basic Terms of this Lease between the
Landlord and Tenant named below. Our Articles, Sections and Paragraphs of the
Lease referred to in this Article I explain and define the Basic Terms and
are to be read in conjunction with the Basic Terms.

      Section 1.1   EFFECTIVE DATE OF LEASE.  March 1, 1994
      Section 1.2   LANDLORD.  Fallbrook Mercantile
                    c/o Wall Street Property Company.

Address of Landlord:        Post Office Box 2633
                            La Jolla, California 92038.

      Section 1.3   TENANT.  Fallbrook National Bank.

Address of Tenant:          Post Office Box 927
                            Fallbrook, California 92028.

      Section 1.4   PREMISES.  In consideration of the rents, covenants and
agreements on the part of Tenant to be paid and performed, the Landlord
leases to the Tenant, and Tenant leases from Landlord, for the Term, at the
rental and upon the conditions of this Lease, that certain space (referred to
herein as the "Premises"), now or hereafter to be erected in the Fallbrook
Mercantile Shopping Center (herein called the "Shopping Center") in Fallbrook
(City) San Diego (County) California (State). The location of the Premises is
outlined in red on the site plan of the Shopping Center, attached hereto as
Exhibit "A" and made a part hereof, and otherwise known as 855-I, J, K, L, M,
N, and O South Main Avenue, Fallbrook, California 92028, (address) said
Premises being agreed for purposes of this Lease, to have an area of
approximately 8,272 (eight thousand two hundred seventy-two) square feet.
Tenant acknowledges that the site plan shown on Exhibit "A" is tentative and
that Landlord may change the shape, size, location, number and extent of the
improvements shown thereon and eliminate or add any improvements to any
portion of the Shopping Center as provided in Article VII herein.

      Section 1.5   LENGTH OF TERM. The term of this Lease shall be for Eight
(8) years and Zero (0) months following the commencement date, commencing at
8:00 A.M. on such commencement date and terminating at 5:00 P.M. on the last
day of the term, unless sooner terminated under any provision hereof.

      Section 1.6   COMMENCEMENT OF TERM. The term of this Lease, and Tenant's
obligation to pay rent, shall commence on April 1, 1994. The Landlord shall
waive three thousand three hundred seventy-eight dollars and ten cents
($3,378.10) of the Minimum Monthly Rental, which is the rental attributible to
Suites M, N, and O, for the months of April, May and June of 1994.

                    All lease expirations, renewal dates, notices of options
to renew, and any other provision hereof relating to the Commencement Date
of this Lease shall be determined by reference to the Commencement Date as
herein defined, which in all cases shall be the first day of the month.

      Section 1.7   ACKNOWLEDGEMENT OF COMMENCEMENT DATE.  When the
commencement and expiration date of the Lease Term have been ascertained
pursuant to Section 1.6 and Article II herein, the parties shall immediately
execute a confirmation of said dates and the Term of this Lease in the form
and content as set forth in Exhibit "X" attached hereto and made a part
hereof.

      Section 1.8   PERMITTED USES.  The Premises shall be used and occupied
only for administrative office and/or branch office of a banking office, or
any other use approved by Landlord, which approval shall not be unreasonably
withheld. Provided, however, the parties agree that it shall be commercially
reasonable for Landlord  to disapprove any use that (i) violates the Declaration
of Restrictions and Grant of Easements ("Declaration") affecting the Premises
recorded on May 4, 1984 in the Office of the County Recorder of San Diego as
File No. 81-163288; or (ii) violates any then existing exclusive use that has
heretofore been granted by Landlord to any other tenant in the Shopping Center
in which the Premises are located; or (iii) adversely impacts the tenant mix of
the Shopping Center as such tenant mix exists at the time that Tenant seeks to
obtain Landlord's consent to a change in use.

      Section 1.9   TENANT'S GUARANTOR. (If none, so state.) None.

                                       1
<PAGE>

     Section 1.10   INITIAL SECURITY DEPOSIT. (See Section 3.5.)  None
Dollars ($__________).

     Section 1.11   MINIMUM MONTHLY RENT AND OTHER CHARGES PAYABLE BY
TENANT.

                    (a)     Minimum Monthly Rent.  Nine Thousand
Ninety-Nine Dollars and Twenty Cents ($9,099.20) per month for the first
twenty-four months, as provided in Section 3.1, which shall be increased on
the second (2nd) anniversary of the day and the month on which the
Commencement Date occurs on each consecutive second (2nd) anniversary
thereafter, (the "Anniversary Date"), in accordance with the increase in
the United States Department of Labor, Bureau of Labor Statistics, Consumer
Price Index for Urban Wage Earners and Clerical Workers (all Items for the
Los Angeles-Anaheim-Riverside Statistical Area on the basis of 1982-84 =
100 [the "Index"]) as provided in Section 3.2.

                    (b)     Other Periodic Payments.  Monthly Payments of
Operating Costs (see Section 4.8) including, without limitation, Taxes,
Utilities, Insurance Premiums, or other amounts as provided in this Lease.
The initial monthly charge for such Operating Costs is Two Thousand Six
Hundred Forty-Seven Dollars and Four Cents ($2,647.04).

     Section 1.12   EXCUSE OF LANDLORD'S PERFORMANCE.  Anything in this
Lease to the contrary notwithstanding, providing such cause is not due to
the willful act or neglect of Landlord, Landlord shall not be deemed in
default with respect to the performance of any of the terms, covenants and
conditions of this Lease if same shall be due to any strike, lockout, civil
commotion, war-like operation, invasion, rebellion, hostilities, military
or usurped power, sabotage, governmental regulations or controls, inability
to obtain any material, service or financing, rain or muddy conditions,
through act of God or other cause beyond the control of Landlord.

     Section 1.13   RIDERS.  The following Riders are attached to and made
a part of this Lease: (If none, so state) Rider No. 1, No. 2, No. 3, No 4,
and No. 5.

                                  ARTICLE II
                                  LEASE TERM

     Section 2.1   LEASE OF PREMISES FOR LEASE TERM.  Landlord leases the
Premises to Tenant and Tenant leases the Premises from Landlord for the
Lease Term.  The Lease Term is for the period stated in Section 1.5 above
and shall begin and end on the dates specified in Section 1.6 above, unless
the beginning or end of the Lease Term is changed under any provision of
this Lease.  The "Commencement Date" shall be the date specified in Section
1.6 above for the beginning of the Lease Term, unless advanced or delayed
under any provision of this Lease.

     Section 2.2  DELAY IN COMPLETION. In the event the Premises herein
demised are not substantially completed on or before_______, 199__, this
Lease shall be deemed null and void at the election of either party by
notice in writing within ten (10) days from said date, and any security
deposit shall be returned to Tenant. The aforementioned date shall be
automatically extended for a reasonable period of time provided Landlord is
diligently pursuing the completion of the Premises. Should either party
elect to declare this Lease null and void as hereinafter provided, Landlord
shall, except for the return of the Tenant's security deposit, have no
obligations or liabilities to Tenant for damages of any kind relating to
the failure to complete construction of the Premises by the date herein
specified.

     Section 2.3  EARLY OCCUPANCY.  If Tenant occupies the Premises prior
to the Commencement Date, Tenant's occupancy of the Premises shall be
subject to all of the provisions of this Lease. Early occupancy of the
Premises shall not advance the expiration date of this Lease. Upon mutual
execution of this lease document, Tenant shall be provided occupancy to the
Premises, however, Tenant shall not be required to pay Minimum Monthly Rent
and other charges specified in this Lease for the early occupancy period.

     Section 2.4  HOLDING OVER.  Tenant shall vacate the Premises upon the
expiration or earlier termination of this Lease. Tenant shall reimburse
Landlord for and indemnify Landlord against all damages incurred by
Landlord caused by any delay in Tenant vacating the Premises. If Tenant
remains in possession of all or any part of the Premises after the
expiration of the Term hereof, with or without the express or implied
consent of Landlord, such tenancy shall be from month-to-month only and not
a renewal hereof or an extension for any further term, and in such case,
Minimum Monthly Rent then in effect shall be increased by fifty percent
(50%) and other monetary sums due hereunder shall be payable in the amount
and at the time specified in this Lease, and such month-to-month tenancy
shall be subject to every other term, covenant and agreement contained
herein, except that the month-to-month tenancy will be terminable on thirty
(30) days notice given at any time by either party.

     Section 2.5  SURRENDER OF PREMISES.  Upon the termination of this
Lease, Tenant shall surrender the Premises to Landlord in the condition
specified in and according to Section 12.6.

     Section 2.6  SUCCESSORS.  All rights and liabilities herein given to,
or imposed upon, the respective parties hereto shall extend to and bind the
several respective heirs, executors, administrators, successors, and
assigns of the said parties; and if there shall be more than one Tenant,
they shall all be bound jointly and severally by the terms, covenants and
agreements herein. No rights, however, shall inure to the benefit of any
assignee or other transferee of Tenant unless the transfer has been
approved by Landlord in writing as provided in Section 15.1 hereof.

                                       2
<PAGE>

                                  ARTICLE III
                              MINIMUM MONTHLY RENT

     Section 3.1  TIME AND MANNER OF PAYMENT.  Upon execution of this
Lease, Tenant shall pay Landlord the Minimum Monthly Rent in the amount
stated in Section 1.11(a) above for the first month of the Lease Term. On
the first day of the second month of the Lease Term and each month
thereafter, Tenant shall pay Landlord the Minimum Monthly Rent and any
other charges and sums provided for herein as Additional Rent, in advance,
without offset, deduction or prior demand. All such rents and charges shall
be payable at Landlord's address or at such other place as Landlord may
designate in writing.

     Section 3.2  COST OF LIVING INCREASES.  The Minimum Monthly Rent shall
be increased every two (2) years as provided in Section 1.11(a) above, in
proportion to increases in the Index. The first such adjustment shall be
made by multiplying the Minimum Monthly Rent by the percentage increase in
the Index published for the month which is three (3) months prior to the
second Anniversary Date  of the Commencement Date of the Lease over the
Index published for the month which is three (3) months prior to the first
month of the Lease Term. Each subsequent adjustment shall be made by
multiplying the Minimum Monthly Rent which is then in effect (as increased
pursuant to the last adjustment) by the percentage increase in the Index
published for the month which is three (3) months prior to each consecutive
second (2nd) Anniversary Date of the Commencement Date of the Lease Term
over the Index published for the month which is three (3) months prior to
the last adjustment date. Landlord shall notify Tenant of each increase by
delivering a written statement setting forth the two Indexes utilized in
computing the adjustment, the percentage increase between those two
Indexes, and the new amount of the Minimum Monthly Rent. In no event
however, shall the Minimum Monthly Rent be increased more than five percent
(5%) per year or over ten percent (10%) over the last previously adjusted
Minimum Monthly Rent. Tenant shall pay the new Minimum Monthly Rent from
its effective date, i.e. the bi-annual Anniversary Date, until the next
periodic increase. Landlord's notice may be given after the effective date
of the increase since the Index for the appropriate month may be
unavailable on the effective date. In such event, Tenant shall pay monthly
rent in the amount required for the previous lease year until the Index
figures are available. Once the Index figures are available and the
adjustment has been computed, the Tenant shall pay Landlord the necessary
rental adjustment for the months elapsed between the effective date of the
increase and Landlord's notice of such increase within ten (10) days after
Landlord's notice. If the format or components of the Index are materially
changed after the date of this Lease, Landlord shall substitute an index
which is published by the Bureau of Labor Statistics or similar agency and
which is most nearly equivalent to the Index in effect on the date of this
Lease. Landlord shall notify Tenant of the substituted index, which shall
be used to calculate the increase in the Minimum Monthly Rent unless Tenant
objects in writing within fifteen (15) days after receipt of Landlord's
notice. If Tenant objects, the substitute index shall be determined in
accordance with the rules and regulations of the American Arbitration
Association. The cost of such arbitration shall be borne equally by
Landlord and Tenant.

     Section 3.3  PERCENTAGE RENT. DELETED

     Section 3.4  GROSS RECEIPTS DEFINED. DELETED

     Section 3.5  SECURITY DEPOSIT INCREASES. DELETED.

     Section 3.6  TERMINATION; ADVANCE PAYMENTS.  Upon termination of this
Lease under Article XII (Damage or Destruction), Article XIII
(Condemnation) or any other termination not resulting from Tenant's
default, and after Tenant has vacated the Premises in the manner required
by this Lease, an equitable adjustment shall be made concerning advance
rent, any other advance payments made by Tenant to Landlord, and accrued
real property taxes, and Landlord shall refund the unused portion of the
Security Deposit to Tenant or Tenant's successor.

                                  ARTICLE IV
                         OTHER CHARGES PAYABLE BY TENANT

     Section 4.1  ADDITIONAL RENT.  All charges payable by Tenant other
than Minimum Monthly Rent are called "Additional Rent." Unless this Lease
provides otherwise, all Additional Rent shall be paid with the next monthly
installment of Minimum Monthly Rent. The term "rent" shall mean Minimum
Monthly Rent and Additional Rent.

     Section 4.2  REAL PROPERTY TAXES.

                  (a)  PAYMENT OF TAXES.  Tenant agrees to pay Tenant's
prorata share of all real property taxes, as hereinafter defined, and
assessments which may be levied or assessed by any lawful authority against
the land on which buildings are located and improvements thereon in the
Shopping Center (collectively referred to as "real property taxes"). Tenant
shell pay its prorata share of property taxes in the manner specified in
Sections 4.8 and 1.11(b). Tenant's prorata share shall be apportioned
according to the floor area of the Premises as it relates to the total
floor area of the building or buildings which include the premises. All
taxes for the year in which this Lease commences shall be apportioned and
adjusted.

                                       3
<PAGE>

                    (b)  DEFINITION OF "REAL PROPERTY TAX." "Real Property
Tax" means: (i) any fee, license fee, license tax, business license fee,
commercial rental tax, levy, charge, assessment, penalty or tax (other than
inheritance or estate taxes) imposed by any authority having the direct or
indirect power to tax, including any city, county, state or federal
government, or any school, agriculture, lighting, drainage or other
improvement district thereof, as against any legal or equitable interest of
Landlord in the Premises; (ii) any tax on the Landlord's right to receive, or
the receipt of, rent or income from the Premises or against Landlord's business
of leasing the Premises; (iii) any tax or charge for fire protection,
streets, sidewalks, road maintenance, refuse or other services provided to
the Premises by any governmental agency; (iv) any tax imposed upon this
transaction or based upon a reassessment of the Premises due to a change in
ownership or transfer of all or part of Landlord's interest in the Premises;
and (v) any charge or fee replacing any tax previously included within the
definition of Real Property Tax. "Real Property Tax" does not, however,
include Landlord's federal or state income, franchise, inheritance or estate
taxes.

                    (c)  TENANT'S RIGHT TO CONTEST TAXES. Tenant may attempt
to have the assess valuation of the Premises reduced or may initiate
proceedings to contest the Real Property Tax. If required by law, Landlord
shall join in the proceedings brought by Tenant. However, Tenant shall pay
all costs of the proceedings, including any costs or fees incurred by
Landlord. Upon the final determination of any proceeding or contest, Tenant
shall immediately pay the Real Property Tax due, together with all costs,
charges, interest and penalties incidental to the proceedings. If Tenant does
not pay the Real Property Tax when due and contests such taxes, Tenant shall
not be in default under this Lease for nonpayment of such taxes if Tenant
deposits funds with Landlord or opens an interest bearing account reasonably
acceptable to Landlord in the joint names of Landlord and Tenant. The amount
of such deposit shall be sufficient to pay the Real Property Tax plus a
reasonable estimate of the interest, costs, charges and penalties which may
accrue if Tenant's action is unsuccessful, less any applicable tax impounds
previously paid by Tenant to Landlord. The deposit shall be applied to the
Real Property Tax due, as determined at such proceedings. The Real Property
Tax shall be paid under protest from such deposit if such payment under
protest is necessary to prevent the Premises from being sold under a "tax
sale" or similar enforcement proceeding.

     Section 4.3  PERSONAL PROPERTY TAXES.

                  (a)  Tenant shall pay prior to delinquency all taxes
charged against trade fixtures, furnishings, equipment or any other personal
property belonging to Tenant. Tenant shall attempt to have such personal
property taxed separately from the Premises.

                  (b)  If any such taxes on Tenant's personal property are
levied against Landlord or Landlord's property, or if the assessed value of
the Premises is increased by the inclusion therein of a value placed upon
such personal property or trade fixtures of Tenant, then Landlord, after
written notice to Tenant, shall have the right to pay the taxes based upon
such increased assessments, regardless of the validity thereof, but only under
proper protest if requested by Tenant in writing. If Landlord shall do so,
then Tenant shall, upon demand, repay to Landlord the taxes levied against
Landlord, or the proportion of such taxes resulting from such increase in the
assessment. In any such event, however, Tenant, at Tenant's sole cost and
expense, shall have the right, in the name of Landlord and with Landlord's
full cooperation, to bring suit in any court of competent jurisdiction to
recover the amount of any such taxes so paid under protest; any amount so
recovered to belong to Tenant.

                  (c)  If any of Tenant's personal property is taxed with
the Property, Tenant shall pay Landlord the taxes for the personal property
within fifteen (15) days after Tenant receives a written statement from
Landlord for such personal property taxes.

      Section 4.4 UTILITIES.  Landlord shall provide sewer service, water,
and refuse disposal to the Premises. Tenant shall pay, directly to the
appropriate supplier, the cost of all natural gas, heat, light, power,
telephone, and other utilities and services supplied to the Premises.
Maintenance for any heating or air conditioning equipment and

                                    4

<PAGE>

ducts on the Premises shall be furnished by Landlord, and Tenant, upon
presentation of a bill therefore, shall pay Landlord, or its agent or assigns,
for such maintenance service. If any services or utilities are jointly
metered with other properties, Landlord shall determine and the Tenant shall
pay, the Tenant's pro rata share of the monthly costs of such utilities and
services. The Tenant's pro rata share shall be determined by the ratio of the
square footage of the Premises as compared to the square footage of all the
property subject to the common metering. In the event Tenant shall require
such services or utilities in excess of that usually furnished or supplied
for use of the Premises as general retail space, Tenant shall pay a
reasonable proportion, to be determined by Landlord, of all such jointly
metered charges. Tenant shall pay its pro rata share of the monthly cost of
such utilities and services in the manner specified in Sections 4.8 and
1.11(b). Landlord reserves the right to require Tenant to install and
maintain, at Tenant's sole expense, separate meters for any public utility
servicing the Premises for which a separate meter is not presently
installed.

     Section 4.5  COST OF MAINTENANCE OF COMMON AREAS.

                  (a)  TENANT TO BEAR PRO RATA SHARE OF EXPENSE. In each
lease year, as defined in Section 3.3(c) hereof, Tenant will pay to Landlord,
in addition to the rentals specified in Article II hereof, as further
Additional Rent, subject to the limitation hereinafter set forth, a
proportion of the Shopping Center's operating cost, hereinafter defined,
based upon the ratio of the square feet of the Premises to the total leasable
square feet of all the building space in the Shopping Center.

                  (b)  OPERATING COST. For the purpose of this Section 4.5
the "Shopping Center's operating cost" means the total cost and expense
incurred in operating and maintaining the common facilities, hereinafter
defined, actually used or available for use by Tenant and the employees,
agents, servants, customers and other invitees of Tenant, specifically
including without limitation, gardening and landscaping, the cost of
liability and property damage insurance, repairs, roof maintenance, line
painting, painting, utilities, sanitary control, pest control, removal of
trash, rubbish, garbage and other refuse, reasonable reserves for
replacements and repairs, property management, bookkeeping, Real Property
Taxes and assessments thereon, and the cost of personnel to implement such
services, to direct parking, and to police the common facilities. In
addition, said operating costs shall include an administrative charge equal
to ten percent (10%) of the actual operating costs and this charge shall be
subsumed in and billed as a part of the common area expenses as Additional
Rent. "Common facilities" means all areas, space, equipment and special
services provided by Landlord for the common or joint use and benefit of the
occupants of the Shopping Center, their employees, agents, servants,
customers and other invitees, including without limitation parking areas,
access roads, driveways, retaining walls, landscaped areas, truck serviceways
or tunnels, loading docks, pedestrian malls, courts, stairs, ramps and
sidewalks, comfort and first aid stations, washrooms and parcel pick-up
stations.

                  (c)  The Additional Rent provided to be paid in this
Section 4.5 shall be paid in the manner specified in Sections 4.8 and 1.11(b).

                  (d)  Changes in the square footage of the Premises
occurring during any monthly period shall be effective on the first day of
the next succeeding monthly period, and the amount of any square footage in
effect for the whole of any quarterly period shall be the average of the
total amounts in effect on the first day of each calendar month in such
quarterly period.

     Section 4.6  INSURANCE PREMIUMS.

                  (a)  LIABILITY INSURANCE. During the Lease Term, Tenant
shall maintain a policy of comprehensive public liability insurance at
Tenant's expense, insuring Landlord against liability arising out of the
ownership, use, occupancy or maintenance of the Premises, the sidewalks in
front of the Premises, and the business operated by Tenant and any subtenants
of Tenant in the Premises. The initial amount of such insurance shall be at
least One Million Dollars ($1,000,000.00) combined single limit bodily
injury, property damage and personal injury, and shall be subject to
periodic increase based upon inflation, increased liability awards,
recommendations of professional insurance advisers, and other relevant
factors. However, the amount of such insurance shall not limit Tenant's
liability nor relieve Tenant of any obligation hereunder. The policy shall
contain cross-liability endorsements, if applicable, and shall insure
Tenant's performance of the indemnity provisions of Section 8.4. Tenant
shall, at Tenant's expense, maintain such other liability insurance as Tenant
deems necessary to protect Tenant.

                  (b)  HAZARD AND RENTAL INCOME INSURANCE. During the Lease
Term, Landlord shall maintain policies of insurance at Tenant's expense,
covering loss of

                                     5

<PAGE>

or damage to the Premises in the full amount of its replacement value. Such
policies shall provide protection against all perils included within the
classification of fire, extended coverage, vandalism, malicious mischief, and
may include endorsements or coverage for special extended perils (all risk),
sprinkler leakage, inflation guard, and any other perils (including flood and
earthquake), which Landlord deems necessary. Landlord may obtain insurance
coverage for Tenant's fixtures, equipment or building improvements installed
by Tenant in or on the Premises. Tenant shall, at Tenant's expense, maintain
such primary or additional insurance on its fixtures, equipment and building
improvements as Tenant deems necessary to protect its interest. During the
Lease Term, Landlord may also maintain a rental income insurance policy at
Tenant's expense, with loss payable to Landlord in an amount equal to one
year's Minimum Monthly Rent (as adjusted periodically), plus estimated Real
Property Taxes and insurance premiums. Tenant shall not do or permit to be
done anything which invalidates any such insurance policies.

                 (c) INSURANCE OF IMPROVEMENTS. Tenant shall at all times
maintain fire insurance with extended coverage in the name of the Landlord
and the Tenant, in an amount adequate to cover the cost of replacement of all
trade fixtures, alterations, decorations, additions or improvements made to
the Premises by Tenant or by Landlord on Tenant's behalf in the event of fire
or extended coverage loss. Such insurance policy shall be maintained with an
insurance company approved by Landlord. Tenant shall deliver to the Landlord,
certificates of such fire insurance policies which shall contain a clause
requiring the insurer to give the Landlord thirty (30) written days' notice
of cancellation of such policies.

                 (d) PAYMENT OF PREMIUMS; INSURANCE POLICIES. Tenant shall
pay its pro rata share of all premiums for insurance policies maintained by
Landlord pursuant to Subsection 4.6(b) in the manner specified in Sections
4.8 and 1.11(b). If the insurance policies maintained by Landlord cover
improvements or real property other than the Premises, Landlord shall also
deliver to Tenant a statement of the amount of the premiums applicable to the
Premises showing, in reasonable detail, how such amount was computed. If the
Lease Term expires before the expiration of the insurance policy period,
Tenant's liability for insurance premiums shall be prorated on an annual
basis. Tenant shall be liable for the payment of any deductible amount under
Landlord's insurance policies.

                 (e) INCREASE IN FIRE INSURANCE PREMIUM. Tenant agrees that
it will not keep, use, manufacture, assemble, sell or offer for sale in or
upon the Premises any article which may be prohibited by the standard form of
fire insurance policy. Tenant agrees to pay any increase in premiums for fire
and extended coverage insurance that may be charged during the term of this
Lease on the amount of such insurance which may be carried by Landlord on
said Premises or the building of which it is a part, resulting from the acts
or omission of the Tenant, its agents, servants or employees, or the use or
occupancy of the Premises by the Tenant or from the type of materials or
products stored, manufactured, assembled or sold by Tenant in the Premises,
whether or not Landlord has consented to the same. In determining whether
increased premiums are the result of Tenant's use of the Premises, a
schedule, issued by the organization making the insurance rate on the
property, showing the various components of such rate, shall be conclusive
evidence of the several items and charges which make up the fire insurance
rate on the Premises.

                 (f) PLATE GLASS. Landlord shall replace, at the expense of
Tenant, any and all plate and other glass, frames or glazing damaged or broken
from any cause whatsoever in and about the Premises. Landlord is responsible for
plate glass replacement caused by structural or similar failure.

                 (g) BOILER INSURANCE. DELETED

                 (h) WAIVER OF SUBROGATION. Landlord and Tenant each hereby
waive any and all rights of recovery against the other or against the
officers, employees, agents and representatives of the other, on account of
loss or damage occasioned to such waiving party or its property or the
property of others under its control, to the extent that such loss or damage
is insured against under any fire and extended coverage insurance policy
which either may have in force at the time of such loss or damage. Tenant
shall, upon the policies of insurance required under this Lease, give notice
to the insurance carrier or carriers that the foregoing mutual waiver of
subrogation is contained in this Lease.

                 (i) FORM OF POLICIES. All policies shall be written in a
form satisfactory to Landlord and shall be maintained with insurance
companies holding a "General Policyholder's Rating" of A, and a financial
rating of X, or better, as set forth in the most current issue of "Best's
Insurance Guide." Tenant shall deliver to Landlord

                                        6
<PAGE>

copies of policies or certificates evidencing the existence of the amounts and
forms of coverage satisfactory to Landlord. No such policy shall be cancellable
or reducible in coverage except after thirty (30) days prior written notice to
Landlord. Tenant shall, within ten (10) days prior to the expiration of such
policies, furnish Landlord with renewals or "binders" thereof, or Landlord may
order such insurance and charge the cost thereof to Tenant as Additional Rent.

     Section 4.7 INTEREST ON PAST DUE OBLIGATIONS. Any amount owed by Tenant to
Landlord which is not paid within ten (10) days after such amount is due shall
bear interest at the rate of fifteen percent (15%) per annum from the due date
of such amount. However, interest shall not be payable on late charges to be
paid by Tenant under this Lease. The payment of interest on such amounts shall
not excuse or cure any default by Tenant under this Lease. If the interest rate
specified in this Lease is higher than the rate permitted by law, the interest
rate is hereby decreased to the maximum legal interest rate permitted by law.

     Section 4.8 IMPOUNDS FOR OPERATING COSTS. Within forty-five (45) days
after the end of each calendar year, Landlord shall deliver to Tenant an
accounting of Tenant's actual pro rata share, together with reasonable
documentation of actual costs, and the amounts paid by Tenant during said
calendar year. If Tenant's payments made during the calendar year exceed
Tenant's pro rata share, Landlord shall pay Tenant the excess at the time
Landlord furnishes the accounting to the Tenant. If Tenant's pro rata share
exceeds the payments made by Tenant, Tenant shall pay Landlord the deficiency
within fifteen (15) days after Tenant's receipt of Landlord's accounting.

                 Landlord shall keep at its place of business full, accurate,
and separate books of account covering the charges provided for under this
Article IV, and the accounting to Tenant shall accurately reflect the total
costs and Tenant's pro rata share. The books of account shall be retained for
at least twelve (12) months after the end of each calendar year. Tenant shall
have the right at all reasonable times to inspect the books of account.

                                    ARTICLE V
                          RECORDS AND BOOKS OF ACCOUNT

                                     DELETED

                                   ARTICLE VI
                                      AUDIT

                                     DELETED

                                   ARTICLE VII
                            CONSTRUCTION OF PREMISES

     Section 7.1 LANDLORD AND TENANT IMPROVEMENTS. Construction of the
improvements on the Premises has been completed on the date of this Lease and
Tenant hereby represents and warrants to Landlord that Tenant has inspected the
Premises and accepts such Premises in the condition existing as of the date
hereof. With respect to 855 South Main Street -- Suites M, N, and 0, Landlord
shall ensure that, at the beginning of the term of the Lease, the Heating,
Ventilation and Air Conditioning, electrical, and plumbing systems are in good
working order. Tenant to advise Landlord within thirty (30) days of occupancy
relative to any deficiencies and Landlord, at Landlord's expense, shall promptly
repair same. After said thirty (30) day period or immediately after any initial
repairs are made as a result of the 30-day warranty, Tenant shall be responsible
for any repairs to the Heating, Ventilation and Air Conditioning, electrical or
plumbing systems in accordance with the Lease herein. Prior to the commencement
of construction of Tenant's improvements, Tenant shall deliver plans and
specifications with respect to Tenant's leasehold improvements to the Landlord
or Landlord's architect.

     Section 7.2 PARKING FACILITIES. The Landlord has constructed upon the
Shopping Center site at its own cost access roads, sidewalks and parking lots or
facilities as shown on Exhibit "A."

     Section 7.3 CHANGES AND ADDITIONS TO BUILDINGS. Landlord hereby reserves
the right at any time to make alterations or additions to and to build
additional stories on the building in which the Premises are contained and to
build another building adjoining the Premises. Landlord also reserves the
right to construct other buildings or improvements in the Shopping Center
from time to time and to make alterations thereof or additions thereto and to
build additional stories on any such building or buildings and to build
adjoining same. Notwithstanding the foregoing, Landlord agrees to perform all
work in connection with construction of any buildings or improvements, or
alterations or additions to existing buildings, in such a manner that said
work shall not materially interfere with access to or visibility of the
Premises. Easements for light and air are not included in the leasing of
these Premises to Tenant. Landlord further reserves the exclusive right to
the roof except as provided in this Lease.

                                        7
<PAGE>

     Section 7.4 FINANCING. DELETED

     Section 7.5 RIGHT TO ADJUST. DELETED

                                  ARTICLE VIII
                                 USE OF PROPERTY

     Section 8.1 PERMITTED USES. Tenant may use the Premises only for the
Permitted Uses set forth in Section 1.8 above.

     Section 8.2 MANNER OF USE.

                 (a) INTERFERENCE WITH USE/NUISANCE. Tenant shall not do or
permit anything to be done in or about the Premises which will in any way
obstruct or interfere with or infringe on the rights of other occupants or
customers of the Shopping Center, or injure or annoy them, or use or allow
the Premises to be used for any improper, immoral, or objectionable purposes;
nor shall Tenant cause, maintain or permit any nuisance in, on or about the
Premise or commit or suffer to be committed any waste in, on or about the
Premises. Tenant shall not be liable to Landlord for any other occupant's
failure to so conduct itself.

                 (b) VIOLATION OF LAW/INSURANCE PROVISIONS. Tenant shall not
do or permit to be done in or about the Premises, nor bring, keep or permit
to be brought or kept therein, anything which is prohibited by or will in
any way conflict with any law, statute, ordinance or governmental rule or
regulation now in force or which may hereafter be enacted or promulgated, or
which is prohibited by any standard form of fire insurance policy or will in
any way increase the existing rate of or affect any fire or other insurance
upon the building or any part thereof or any of its contents, or cause a
cancellation of any insurance policy covering the building or any part
thereof or any of its contents. Tenant shall comply with all governmental
laws, ordinances and regulations applicable to the Premises, and the
requirements of any Board of Fire Underwriters or other similar body now or
hereafter instituted, with any order, directive or certificate of occupancy
issued pursuant to any law, ordinance or regulation by any public officer
insofar as the same relates to or affects the condition, use or occupancy of
the Premises, including but not limited to, requirements of structural
changes related to or affected by Tenant's acts, occupancy or use of the
Premises, all at Tenant's sole expense. The judgment of any court of
competent jurisdiction or the admission of Tenant in any action against
Landlord, whether or not Tenant is a party to such action, shall be
conclusive in establishing such violations between Landlord and Tenant.

                 (c) PERMITS. Tenant shall obtain and pay for all permits,
including a certificate of occupancy, required for Tenant's occupancy of the
Premises and shall promptly take all substantial and nonsubstantial actions
necessary to comply with all applicable statutes, ordinances, rules,
regulations, orders and requirements regulating the use by Tenant of the
Premises, including the Occupational Health and Safety Act.

                 (d) STORE OPERATION. Tenant shall conduct its business in
the Premises during the regular customary days and hours for such type of
business in the city or trade area in which the Shopping Center is located.

                 (e) CHANGE OF NAME. Tenant agrees not to change the
advertised name of the business operated in the Premises without the written
permission of Landlord, said consent not to be unreasonably withheld.

                 (f) SOLICITATION OF BUSINESS. Tenant and Tenant's employees
and agents shall not solicit business in the parking or other common areas,
nor shall Tenant distribute any handbills or other advertising matter in
automobiles parked in the parking area or in other common areas.

     Section 8.3 COMPETITION. DELETED

     Section 8.4 INDEMNIFICATION OF LANDLORD. Tenant shall indemnify and hold
Landlord harmless from all damages arising out of loss of life, personal injury,
and/or damage to the property occurring in, on, or about the Premises, except
that Landlord shall be liable to Tenant for such damages resulting from the acts
or omissions of Landlord or its authorized representatives and shall indemnify
and hold Tenant harmless from all such damages. A party's obligation under this
paragraph to indemnify and hold the other party harmless shall be limited to the
sum that exceeds the amount of insurance proceeds, if any, received by the
party being indemnified.

                                       8
<PAGE>

     Section 8.5    LANDLORD'S ACCESS. Landlord or its agents may enter the
Premises at all reasonable times to show the Premises to potential buyers,
investors or tenants or other parties, or for any other purpose Landlord deems
necessary. Landlord shall give Tenant twenty-four (24) hours' prior notice of
such entry, except in the case of an emergency. Landlord may not place "For
Sale" signs on the Premises. Landlord may place customary "For Lease" signs on
the Premises not sooner than ninety (90) days prior to the end of the then
unexpired term of this Lease.

     Section 8.6    EXCAVATION. If an excavation shall be made upon land
adjacent to or under the Premises, or shall be authorized to be made, Tenant
shall afford to the person causing or authorized to cause such excavation,
license to enter upon the Premises for the purpose of doing such work as
Landlord shall deem necessary to preserve the wall or the building of which the
Premises form a part from injury or damage and to support the same by proper
foundations, without any claim for damages or indemnification against  Landlord
or diminution or abatement of rent. Provided, however, that Landlord shall cause
such work to be performed in such a manner that said work shall not materially
interfere with the operation of Tenant's business.

     Section 8.7    QUIET POSSESSION. If Tenant pays the rent and complies with
all other terms of this Lease, Tenant may occupy and enjoy the Premises for the
full Lease Term, subject to the provisions of this Lease.

     Section 8.8    WINDOW COVERINGS. Landlord shall select a standard window
covering and color for use throughout the building and Tenant shall use this
standard window covering for any windows Tenant shall cover. Tenant shall be
required to provide, at its expense, prescribed coverings in front of windows in
which the space is utilized for other than office use, such as storage or
manufacturing.

                                   ARTICLE IX
                   PARKING AND COMMON USE AREAS AND FACILITIES

     Section 9.1    CONTROL OF COMMON AREAS BY LANDLORD. All automobile parking
areas, driveways, entrances and exits thereto, and other facilities furnished by
Landlord in or near the Shopping Center, including employee parking areas, the
truck way or ways, loading docks, package pick-up stations, sidewalks and ramps,
landscaped areas, exterior stairways, first-aid stations, comfort stations and
other areas and improvements provided by Landlord for the general use, in
common, of tenants, their officers, agents, employees and customers, shall at
all times be subject to the exclusive control and management of Landlord, and
Landlord shall have the right from time to time to establish, modify and enforce
reasonable rules and regulations with respect to all facilities and areas
mentioned in this Article. Landlord shall have the right to construct, maintain
and operate lighting facilities on all said areas and improvements; to police
the same; from time to time to change the area, level, location and arrangement
of parking areas and other facilities hereinabove referred to; to restrict
parking by tenants, their officers, agents and employees to employee parking
areas; to enforce parking charges (by operation of meters or otherwise), with
appropriate provisions for free parking ticket validating by tenants; to close
all or any portion of said areas or facilities to such extent as may, in the
opinion of Landlord's counsel, be legally sufficient to prevent a dedication
thereof or the accrual of any rights to any person or the public therein; to
close temporarily all or any portion of the parking areas or facilities; to
discourage non-customer parking; and to do and perform such other acts in and
to said areas and improvements as, in the use of good business judgment, the
Landlord shall determine to be advisable with a view to the improvement of the
convenience and use thereof by tenants, their officers, agents, employees and
customers. Landlord will operate and maintain the common facilities referred to
above in such manner as Landlord, in its sole discretion, shall determine from
time to time. Without limiting the scope of such discretion, Landlord shall have
the full right and authority to employ all personnel and to make all rules and
regulations pertaining to and necessary for the proper operation and maintenance
of the common areas and facilities. Notwithstanding any other provision of this
Section, Landlord shall not have the right to make changes that materially
interfere with access to or visibility of the Premises. Furthermore, Landlord
shall not reduce the ratio of parking spaces to square feet of leasable floor
area in the entire Shopping Center below that in existence on the date of
execution of this Lease.

     Section 9.2    TENANT'S RIGHT TO USE. Landlord gives to Tenant and its
authorized representatives and invitees the nonexclusive right to use the common
areas, with others who are entitled to use the common areas, subject to
Landlord's rights set forth in Section 9.1.

     Section 9.3    MERCHANTS' ASSOCIATION. DELETED

                                       9
<PAGE>

                                    ARTICLE X
                            SIGNS, AWNINGS, CANOPIES,
                      FIXTURES, ALTERATIONS, IMPROVEMENTS

     Section 10.1   SIGNS AND AUCTIONS. No auction, fire or bankruptcy sales may
be conducted in the Premises, and no signs advertising such sales shall be
posted on the Premises without the previous written consent of Landlord.

     Section 10.2   INSTALLATION BY TENANT. Tenant shall not make or cause to be
made any alterations, additions or improvements or install or cause to be
installed any trade fixtures, exterior signs, exterior machinery, floor
covering, interior or exterior lighting, plumbing fixtures, shades or awnings or
make any changes to the Premises without first obtaining Landlord's written
approval and consent. All fixtures installed by Tenant shall be new or
completely reconditioned. Tenant shall present to the Landlord plans and
specifications for such work at the time approval is sought. Landlord shall not
unreasonably withhold its approval and consent, and further Landlord shall not
withhold its approval and consent to Tenant's installation of any facilities
required in order to comply with the requirements of any regulatory agency.
Improvements that do not materially alter structural portions of the Premises,
and that do not exceed $25,000 in cost, shall not require the prior consent of
the Landlord.

     Section 10.3   IMPROVEMENTS. DELETED

     Section 10.4   NONREMOVAL BY TENANT. All alterations, additions and
improvements, including signs and sign cases, made by Tenant, or made by the
Landlord on the Tenant's behalf and for which Tenant has paid Landlord in
accordance with this Lease, shall remain the property of the Tenant for the term
of the Lease, or any extension or renewal thereof. Such alterations, additions
and improvements shall not be removed from the Premises. At the expiration or
termination of this Lease Term, or any extensions or renewals thereof, all such
alterations, additions and improvements become the property of the Landlord.

     Section 10.5   REMOVAL AND RESTORATION. Landlord may, in its sole and
absolute discretion, require Tenant upon expiration or termination of this Lease
Term to return all or part of the leased Premises to their condition as existed
at the commencement of the Lease Term, removing any alteration, addition or
improvement made by Tenant, or made by Landlord on the Tenant's behalf. In
removing any such alteration, addition or improvement as may be required by the
Landlord, the Tenant shall repair any damage to the Premises caused by such
removal and, prior to such removal, Tenant shall post a bond or other security
as may be required by the Landlord in order to insure the Landlord that the
Premises will be repaired in a prompt and workmanlike manner.

     Section 10.6   LIENS. Tenant shall keep the Premises and any building of
which the Premises are a part free from any liens arising out of work performed,
materials furnished or obligations incurred by Tenant and shall indemnify, hold
harmless and defend Landlord from any liens and encumbrances arising out of any
work performed or materials furnished by, or at the direction of, Tenant. In the
event that Tenant shall not, within twenty (20) days following the imposition of
any lien, cause such lien to be released of record by payment or posting of a
proper bond, Landlord shall have, in addition to all other remedies provided
herein and by law, the right, but not the obligation, to cause the same to be
released by such means as it shall deem proper, including payment of the claim
giving rise to such lien. All such sums paid by Landlord and all expenses
incurred by it in connection therewith shall bear interest at the rate of ten
percent (10%) per annum from the date expended until the date repaid. Landlord
shall have the right at all times to post and keep posted on the Premises any
notices permitted or required by law, or which Landlord shall deem proper, for
the protection of Landlord and the Premises, and any other party having an
interest therein from mechanics' and materialmen's liens, and Tenant shall give
to Landlord at least fifteen (15) business days prior written notice of the
expected date of commencement of any work relating to alterations or additions
to the Premises.

     Section 10.7   SIGNS, AWNINGS AND CANOPIES. Tenant will not place or suffer
to be placed or maintained on any exterior door, wall or window of the Premises
any sign, awning or canopy, or advertising matter or other thing of any kind,
and will not place or maintain any decoration, lettering or advertising matter
on the glass of any window or door of the Premises without first obtaining
Landlord's written approval and the approval and consent of any governmental
body having jurisdiction over signs in the Shopping Center. Notwithstanding any
other provision of this Section, Tenant shall have the right, without prior
approval of the Landlord, to install on windows and/or doors any signs that
shall be required by regulatory authorities.

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<PAGE>

                    Tenant further agrees to maintain such signs, awnings,
canopy, decoration, lettering or other advertising matter as may be approved, in
good condition and repair at all times. Tenant also agrees, at Tenant's sole
cost, to obtain canopy sign faces which shall conform to Tenant's logo and
letter style. A drawing of proposed signs shall be submitted by Tenant to
Landlord for written approval. Such approval shall be made promptly by Landlord
and shall not be unreasonably withheld.

                                   ARTICLE XI
                              CONDITION OF PROPERTY;
                      MAINTENANCE, REPAIRS AND ALTERATIONS

     Section 11.1   EXISTING CONDITIONS. Tenant accepts the Premises in its
condition as of the execution of this Lease, subject to all recorded matters,
laws, ordinances, and governmental regulations and orders. Tenant acknowledges
that neither Landlord nor any agent of Landlord has made any representation as
to the condition of the Premises or the suitability of the Premises for Tenant's
intended use.

     Section 11.2   EXEMPTION OF LANDLORD FROM LIABILITY; WAIVER. Landlord shall
not be liable for any damage or injury to the person, business (or any loss of
income therefrom), goods, wares, merchandise or other property of Tenant,
Tenant's employees, invitees, customers or any other person in or about the
Premises, whether such damage or injury is caused by or results from: (a) fire,
steam, electricity, water, gas or rain; (b) the breakage, leakage, obstruction
or other defects of pipes, sprinklers, wires, appliances, plumbing, air
conditioning or lighting fixtures or any other cause; (c) conditions arising in
or about the Premises or upon other portions of any building of which the
Premises is a part, or from other sources or places; or (d) any act or omission
of any other tenant or occupant of the Shopping Center or of any building of
which the Premises is a part. Landlord shall not be liable for any such damage
or injury even though the cause of or the means of repairing such damage or
injury are not accessible to Tenant. Tenant, as a material part of the
consideration to be rendered to Landlord, hereby waives all claims against
Landlord for the foregoing damages from any cause arising at any time. The
provisions of this Section 11.2 shall not, however, exempt Landlord from
liability for Landlord's negligence or willful misconduct.

     Section 11.3   TENANT'S OBLIGATIONS.

                    (a)  Tenant shall keep the Premises (including all
nonstructural, interior and exterior portions, systems and equipment, all glass,
glazing, window moldings, partitions, doors, door hardware, interior painting,
fixtures and appurtenances thereof including electrical, lighting, plumbing and
plumbing fixtures) in good order, condition and repair during the Lease Term.
Tenant shall promptly replace any portion of the Premises or system or equipment
in the Premises which cannot be fully repaired, regardless of whether the
benefit of such replacement extends beyond the Lease Term. Landlord shall
obtain, at Tenant's expense, a preventive maintenance contract providing for the
regular inspection and maintenance of the heating and air conditioning system
(including leaks around ducts, pipes, vents, or other parts of the air
conditioning) by a licensed heating and air conditioning contractor. It is the
intention of Landlord and Tenant that, at all times during the Lease Term,
Tenant shall maintain the Premises in an attractive, first-class and fully
operative condition.

                    (b)  All of Tenant's obligations to maintain and repair
shall be accomplished at Tenant's sole expense. If Tenant refuses or neglects to
repair properly as required hereunder and to the reasonable satisfaction of
Landlord, Landlord may, on ten (10) days' prior notice (except that no notice
shall be required in case of emergency) enter the Premises and perform such
repair and maintenance on behalf of Tenant without liability to Tenant for any
loss or damage that may accrue to Tenant's merchandise, fixtures, or other
property or to Tenant's business by reason thereof, and upon completion thereof,
Tenant shall pay Landlord's costs for making such repairs plus twenty percent
(20%) for overhead, upon presentation of a bill therefore, as Additional Rent.
Said bill shall include interest at ten percent (10%) on said costs from the
date of completion of repairs by Landlord.

     Section 11.4   LANDLORD'S OBLIGATIONS. Subject to the provisions of Article
XII (Damage or Destruction), Article XIII (Condemnation) and Article IX (Parking
and Common Use Facilities), other than structural repairs Landlord shall have
absolutely no responsibility to repair, maintain or replace any portion of the
Premises at any time. Tenant waives the benefit of any present or future law
which might give Tenant the right to repair the Premises at Landlord's expense
or to terminate the Lease due to the condition of the Premises.

                                       11
<PAGE>

     Section 11.5 RULES AND REGULATIONS.

             (a) The Tenant agrees as follows:

                 (1) All garbage and refuse shall be kept in the kind of
container specified by Landlord, and shall be placed outside of the Premises
in specified trash containers prepared for collection in the manner and at
the times and places specified by Landlord. If Landlord shall provide or
designate a service for picking up refuse and garbage, Tenant shall use same
at Tenant's cost. Tenant shall pay the cost of removal of any of Tenant's
refuse or rubbish.

                 (2) No aerial shall be erected on the roof or exterior walls of
the Premises, or on the grounds, without in each instance, the written consent
of the Landlord. Any aerial so installed without such written consent shall be
subject to removal without notice at any time.

                 (3) No loudspeakers, televisions, phonographs, radios, or other
devices shall be used in a manner so as to be heard or seen outside of the
Premises without the prior written consent of the Landlord.

                 (4) The outside areas immediately adjoining the building shall
be kept clean and free from dirt and rubbish by the Tenant to the satisfaction
of the Landlord and Tenant shall not place or permit any obstruction or
materials in such areas. No exterior storage shall be allowed without permission
in writing from Landlord.

                 (5) Tenant and Tenant's employees shall park only the number of
cars approved and only in those portions of the parking area designated for that
purpose by Landlord.

                 (6) The plumbing facilities shall not be used for any other
purpose than that for which they are constructed, and no foreign substance of
any kind shall be thrown therein, and the expense of any breakage, stoppage, or
damage resulting from a violation of this provision shall be borne by Tenant,
who shall, or whose employees, agents or invitees shall have caused it.

                 (7) Tenant shall use at Tenant's cost such pest extermination
contractor as Landlord may direct and at such intervals as Landlord may require.

                 (8) Tenant shall not burn any trash or garbage of any kind in
or about the Premises, or the building.

             (b) Landlord reserves the right from time to time to amend or
supplement the foregoing rules and regulations, and to adopt and promulgate
additional reasonable rules and regulations applicable to the Premises.
Notice of such reasonable rules and regulations and amendments and
supplements thereto, if any, shall be given to the Tenant and Tenant agrees
to comply with all such reasonable rules and regulations upon receipt of
notice. Landlord shall not be liable in any way to Tenant for any damage or
inconvenience caused by any other tenant's non-compliance with these
reasonable rules and regulations.

     Section 11.6 CONDITION UPON TERMINATION. Upon the termination of this
Lease, Tenant shall surrender the Premises to Landlord, broom clean and in the
same condition as received except for ordinary wear and tear which Tenant was
not otherwise obligated to remedy under any provision of this Lease. However,
Tenant shall not be obligated to repair any damage which Landlord is required to
repair under Article XII (Damage or Destruction). In addition, Landlord may
require Tenant to remove any alterations, additions or improvements (whether or
not made with Landlord's consent) prior to the termination of this Lease and to
restore the Premises to its prior condition, all at Tenant's expense. All
alterations, additions and improvements which Landlord has not required Tenant
to remove shall become Landlord's property and shall be surrendered to Landlord
upon the termination of this Lease, except that Tenant may remove any of
Tenant's machinery or equipment which can be removed without material damage to
the Premises. Tenant shall repair, at Tenant's expense, any damage to the
Premises caused by the removal of any such machinery or equipment. In no event,
however, shall Tenant remove any of the following materials or equipment without
Landlord's prior written consent: any power wiring or power panels; lighting or
lighting fixtures; wall coverings; drapes, blinds or other window coverings;
carpets or other floor coverings; heaters, air conditioners or any other heating
or air conditioning equipment; fencing or security gates; or other similar
building operating equipment and decorations.

                                       12
<PAGE>

                                   ARTICLE XII
                              DAMAGE OR DESTRUCTION

     Section 12.1 PARTIAL DAMAGE TO LEASED PREMISES. Tenant shall notify
Landlord in writing immediately upon the occurrence of any damage to the
Premises. If the premises is only partially damaged and if the proceeds received
by Landlord from the insurance policies described in Article IV are sufficient
to pay for the necessary repairs, this Lease shall remain in effect and Landlord
shall repair the damage as soon as reasonably possible. Landlord may elect to
repair any damage to Tenant's fixtures, equipment, or improvements. If the
insurance proceeds received by Landlord are not sufficient to pay the entire
cost of repair, or if the cause of the damage is not covered by the insurance
policies which Landlord maintains under Article IV, Landlord may elect either to
(a) repair the damage as soon as reasonably possible, in which case this Lease
shall remain in full force and effect, or (b) terminate this Lease as of the
date the damage occurred. Landlord shall notify Tenant within thirty (30) days
after receipt of notice of the occurrence of the damage, whether Landlord elects
to repair the damage or terminate this Lease. If Landlord elects to repair the
damage, Tenant shall pay Landlord the "deductible amount" (if any) under
Landlord's insurance policies or the Tenant's pro rata share thereof if the
Premises is in a multi-tenant building, and, if the damage was due to the
negligence or willful misconduct of Tenant, the difference between the actual
cost of repair and any insurance proceeds received by Landlord. If Landlord
elects to terminate this Lease, Tenant may elect to continue this Lease in full
force and effect, in which case Tenant shall repair any damage to the Premises
and any building in which the Premises is located. Tenant shall pay the cost of
such repairs, except that, upon satisfactory completion of such repairs,
Landlord shall deliver to Tenant any insurance proceeds received by Landlord for
the damage repaired by Tenant. Tenant shall give Landlord written notice of such
election within ten (10) days after receiving Landlord's termination notice. If
the damage to the Premises occurs during the last six (6) months of the Lease
Term, Landlord may elect to terminate this Lease as of the date the damage
occurred, regardless of the sufficiency of any insurance proceeds and Landlord
may retain all such proceeds. In such event, Landlord shall not be obligated to
repair or restore the Premises and Tenant shall have no right to continue this
Lease. Landlord shall notify Tenant of its election within thirty (30) days
after receipt of notice of the occurrence of the damage. If the Landlord elects
to repair the damage, Landlord shall include in Landlord's notice of such
election an estimate of the time necessary to complete such repairs. Tenant
shall have the right to terminate the Lease if (a) Landlord's estimate of the
time required to repair the damage exceeds 120 days after the occurrence of such
damage, or (b) such repairs are not completed within 180 days after the
occurrence of such damage, or (c) the damage occurs within six months of the end
of the Term of the Lease.

     Section 12.2 TOTAL OR SUBSTANTIAL DESTRUCTION. If the Premises is totally
or substantially destroyed by any cause whatsoever, or if the Premises is in a
building which is substantially destroyed (even though the Premises is not
totally or substantially destroyed), this Lease shall terminate as of the date
the destruction occurred regardless of whether Landlord receives any insurance
proceeds. However, if the Premises can be rebuilt within 180 days after the date
of destruction, Landlord may elect to rebuild the Premises at Landlord's own
expense (with all insurance proceeds being made available to the Landlord to
apply against such costs), in which case, this Lease shall remain in full force
and effect. Landlord shall notify Tenant of such election within thirty (30)
days after the occurrence of total or substantial destruction. If the
destruction was caused by the negligence or willful misconduct of Tenant, Tenant
shall pay Landlord the difference between the actual cost of rebuilding and any
insurance proceeds received by Landlord. Tenant shall have the right to
terminate the Lease if such rebuilding is not completed within said 180-day
period or if the destruction occurs within six months of the end of the Term of
the Lease.

     Section 12.3 PARTIAL DESTRUCTION OF SHOPPING CENTER. In the event that
fifty percent (50%) or more of the rentable area of the Shopping Center shall be
damaged or destroyed by fire or other cause, notwithstanding that the Premises
may be unaffected by such fire or other cause. Landlord shall have the right, to
be exercised by notice in writing delivered to Tenant within sixty (60) days
from and after said occurrence, to elect to cancel and terminate this Lease.
Upon the giving of such notice to Tenant, the term of this Lease shall expire by
lapse of time upon the ninetieth (90th) day after such notice is given, and
Tenant shall vacate the Premises and surrender the same to Landlord. Nothing in
this Section nor any other Section hereof shall be construed as a limitation of
Tenant's liability for such occurrence, should such liability otherwise exist.

     Section 12.4 UNINSURED CASUALTY. In the event the Premises is damaged or
destroyed to the extent of fifteen percent (15%) or more of the replacement
value thereof by any casualty not covered under the fire and extended coverage
insurance covered by Landlord or Tenant, then Landlord may elect to terminate
this Lease.

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<PAGE>

Landlord shall notify Tenant of its exercise of such election within thirty (30)
days after the occurrence of the damage or destruction. In the event of such
termination the rights and obligations of the parties hereunder shall cease. If
the Landlord does not elect to so terminate, then the Landlord shall promptly
commence repairing such damage at the Landlord's cost and expense. If the
Landlord elects to repair the damage, Landlord shall include in Landlord's
notice of such election an estimate of the time necessary to complete such
repairs. Tenant shall have the right to terminate the Lease if (a) Landlord's
estimate of the time required to repair the damage exceeds 120 days after the
occurrence of such damage, or (b) such repairs are not completed within 180 days
after the occurrence of such damage, or (c) the damage occurs within six months
of the end of the Term of the Lease.

     Section 12.5 LANDLORD'S OBLIGATIONS. Landlord shall not be required to
repair any injury or damage by fire or other cause, or to make any restoration
or replacement of any panelings, decorations, partitions, railings, floor
coverings, office fixtures or any other improvements or property installed in
the Premises by Tenant or at the direct or indirect expense of Tenant which are
not part of the original Tenant improvements paid for by Landlord. Tenant shall
be required to restore or replace same in the event of damage except for damage
caused solely by the Landlord's negligence or intentional misconduct. Tenant
shall have no claim against Landlord for any damage suffered by reason of any
such damage, destruction, repair or restoration, nor shall Tenant have the right
to terminate this Lease as the result of any statutory provision now or
hereafter in effect pertaining to the damage and destruction of the Premises,
except as expressly provided herein.

     Section 12.6 TEMPORARY REDUCTION OF RENT. If the Premises are destroyed or
damaged and Landlord or Tenant repairs or restores the Premises pursuant to the
provisions of this Article XII, any rent payable during the period of such
damage, repair and/or restoration shall be reduced based on the extent to which
the destruction interferes with Tenant's use of the Premises. Except for such
possible reduction in payments required from the Tenant, Tenant shall not be
entitled to any compensation, reduction, or reimbursement from Landlord as a
result of any damage, destruction, repair, or restoration of or to the leased
Premises.

     Section 12.7 WAIVER. Tenant waives the protection of any statute, code or
judicial decision which grants a tenant the right to terminate a lease in the
event of damage or destruction of the Premises. Tenant agrees that the
provisions of this Article XII shall govern the rights and obligations of
Landlord and Tenant in the event of any damage or destruction of the Premises.

                                  ARTICLE XIII
                                  CONDEMNATION

     Section 13.1 TOTAL CONDEMNATION. If the whole of the Premises shall be
acquired or condemned by eminent domain for any public or quasi-public use or
purpose, then the term of this Lease shall cease and terminate as of the date of
title vesting in such proceeding and all rentals shall be paid up to that date
and Tenant shall have no claim against Landlord for the value of any unexpired
term of this Lease.

     Section 13.2 TOTAL CONDEMNATION OF PARKING AREA. If the whole of the common
parking areas in the Shopping Center shall be acquired or condemned by eminent
domain for any public or quasi-public use or purpose, then the term of this
Lease shall cease and terminate as of the date of title vesting in such
proceeding unless Landlord shall take reasonable steps to provide other parking
facilities substantially equal to the previously existing ratio between the
common parking areas and the Premises, and such substantially equal parking
facilities shall be provided by Landlord at its own expense within ninety (90)
days from the date of acquisition. In the event that Landlord shall provide such
other substantially equal parking facilities, then this Lease shall continue in
full force and effect. In any event, Tenant shall have no claim against Landlord
for the value of any unexpired term of this Lease.

     Section 13.3 PARTIAL CONDEMNATION. If any part of the Premises shall be
acquired or condemned by eminent domain for any public or quasi-public use or
purpose, and in the event that such partial taking or condemnation shall render
the Premises unsuitable for the business of the Tenant, then the term of this
Lease shall cease and terminate as of the date of title vesting in such
proceeding and Tenant shall have no claim against Landlord for the value of any
unexpired term of this Lease. In the event of a partial taking or condemnation
which is not extensive enough to render the Premises unsuitable for the business
of the Tenant, then Landlord shall within a reasonable time restore the Premises
to a condition comparable to its condition at the time of such condemnation less
the portion lost in the taking, and this Lease shall continue in full force and
effect, except that (i) the Minimum Monthly Rent payable hereunder shall be

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<PAGE>

reduced by an amount that is in the same ratio to Minimum Monthly Rent as the
total number of square feet in the Premises taken bares to the total number of
square feet in the Premises immediately before the date of taking, and (ii) the
square footage of the Premises set forth in Section 1.4 shall be reduced to the
number of square feet in the Premises after the date of the taking, and (iii)
Tenant's pro rata share of amounts due pursuant to Article IV of this Lease
shall be calculated in accordance with such revised square footage.

     Section 13.4 PARTIAL CONDEMNATION OF PARKING AREA. If any part of the
parking area in the Shopping Center shall be acquired or condemned by eminent
domain for any public or quasi-public use or purpose and if, as the result of
such partial taking the ratio of square feet of parking area and common use
areas and facilities as described in Section 9.1 hereof to square feet of the
sales area of the entire Shopping Center buildings is reduced to a ratio below
two to one, then the term of this Lease shall cease and terminate from the date
of title vesting in such proceeding, unless the Landlord shall take reasonable
steps toward increasing said ratio to a ratio equal to or in excess of two to
one, in which event this Lease shall be unaffected and remain in full force and
effect as between the parties. In any event, Tenant shall have no claim against
Landlord for the value of any unexpired term of this Lease.

     Section 13.5 CONDEMNATION OF LESS THAN A FEE. If as a result of
condemnation proceeds, a leasehold interest or a right of possession only is
taken by condemnation under the power of eminent domain, and is for a limited
period of time less than the then unexpired Term, this Lease shall continue in
full force and effect and the award shall be payable to Landlord and shall be
credited by Landlord against the rentals payable by Tenant hereunder; provided,
however, that if the taking is for a period of more than one (1) year, Tenant
shall have the right to terminate the Lease by giving written notice of
termination to Landlord within thirty (30) days following such taking. If the
award received by Landlord is in excess of the Rent due, Tenant shall be
entitled to receive such excess, and, if the amount go received by Landlord is
less than Rent due, then Tenant shall pay the amount of such deficiency. If such
condemnation shall be for a period of time extending beyond the expiration of
the Term, the foregoing provisions shall apply only to the date of termination
of the Term, and upon the expiration of said Term, Landlord shall receive all
awards thereafter payable and no accounting shall be made to Tenant for such
period extending beyond the termination of the Term, and Tenant shall have no
liability whatsoever under the terms of this Lease after such termination date.

                 If the taking is such that it will render the Premises
unsuitable for the business of the Tenant for a period exceeding one hundred
twenty (120) days, then Tenant, at its option, may terminate the Lease.

     Section 13.6 DISTRIBUTION OF CONDEMNATION AWARD. Any condemnation award or
payment shall be distributed in the following order: (a) first, to any ground
lessor, mortgagee or beneficiary under a deed of trust encumbering the Premises,
the amount of its interest in the Premises; (b) second, to Tenant, only the
amount of any award specifically designated for loss of or damage to Tenant's
trade fixtures or removable personal property, and the Tenant hereby assigns any
other rights which the Tenant may have now or in the future to any other award
to the Landlord; and (c) third, to Landlord, the remainder of such award,
whether as compensation for reduction in the value of the leasehold the taking
of the fee, or otherwise. If this Lease is not terminated, Landlord shall repair
any damage to the Premises caused by the condemnation, except that Landlord
shall not be obligated to repair any damage for which Tenant hag been reimbursed
by the condemning authority. If the severance damages received by Landlord are
not sufficient to pay for such repair, Landlord shall have the right to either
terminate this lease or make such repair at landlord's expense.

                                   ARTICLE XIV
                            ASSIGNMENT AND SUBLETTING

     Section 14.1 LANDLORD'S CONSENT REQUIRED. No portion of the Premises or of
Tenant's interest in this Lease may be acquired by any other person or entity,
whether by assignment, mortgage, sublease, transfer, operation of law, or act of
Tenant, without Landlord's prior written consent. Any attempted transfer without
consent shall be void and shall constitute a noncurable breach of this Lease. If
Tenant is a partnership, any cumulative transfer of more than twenty percent
(20%) of the partnership interests shall require Landlord's consent. Landlord's
consent shall not be unreasonably withheld; provided, however, the parties agree
that it shall be commercially reasonable for Landlord to withhold consent to any
proposed transfer if the proposed transferee's use would (i) violate the
Declaration; or (ii) violate any exclusive use granted by Landlord to any other
tenant in the Shopping Center; or (iii) adversely impacts the tenant mix of the
Shopping Center as such tenant mix exists at the time that Tenant seeks to
obtain Landlord's consent.

                                       15
<PAGE>

     Section 14.2 GRANT OF CONCESSIONS; CONDITIONS TO GRANT. The provision
against subletting elsewhere contained in this Lease shall not prohibit Tenant
from granting concessions for the operation of one or more departments of the
business which Tenant is permitted by Section 1.8 to conduct in or upon the
Premises; provided, however, that (a) each such concession may be granted only
upon receipt by Tenant of the written consent of the Landlord and shall be
subject to all the terms and provisions of this Lease; (b) the gross receipts,
as defined in Section 3.4 hereof, from the operation of each such concession,
shall be deemed to be a part of the gross receipts of Tenant for the purpose of
determining the additional rental payable to Landlord; (c) all of the provisions
hereof applying to the business of Tenant including the provisions concerning
reports and audits shall apply to each such concession; and (d) at least
seventy-five (75%) percent of the sales floor area of the Premises shall at all
times be devoted to the business of and be operated by Tenant. Landlord's
consent shall not be unreasonably withheld; provided, however, the parties agree
that it shall be commercially reasonable for Landlord to withhold consent to any
proposed transfer if the proposed transferee's use would (i) violate the
Declaration; or (ii) violate any exclusive use granted by Landlord to any other
tenant in the Shopping Center; or (iii) adversely impacts the tenant mix of the
Shopping Center as such tenant mix exists at the time that Tenant seeks to
obtain Landlord's consent.

     Section 14.3 NO RELEASE OF TENANT. No transfer permitted by this Article
XIV, shall release Tenant or change Tenant's primary liability to pay the rent
and to perform all other obligations of Tenant under this Lease. Landlord's
acceptance of rent from any other person is not a waiver of any provision of
this Article XIV. Consent to one transfer is not a consent to any subsequent
transfer. If Tenant's transferee defaults under this Lease, Landlord may proceed
directly against Tenant without pursuing remedies against the transferee.
Landlord may consent to subsequent assignments or modifications of this Lease by
Tenant's transferee, without notifying Tenant or obtaining its consent. Such
action shall not relieve Tenant's liability under this Lease.

     Section 14.4 LANDLORD'S ELECTION. Tenant's request for consent to any
transfer described in Section 14.1 above shall be accompanied by a written
statement setting forth the details of the proposed transfer, including the
name, business and financial condition of the prospective transferee, financial
details of the proposed transfer (e.g., the term of and rent and security
deposit payable under any assignment or sublease), and any other information
Landlord deems relevant. Landlord shall have the right (a) to withhold consent,
if reasonable; or (b) to grant consent.

     Section 14.5 NO MERGER. No merger shall result from Tenant's sublease of
the Premises under this Article XIV, Tenant's surrender of this Lease or the
termination of this Lease in any other manner. In any such event, Landlord may
terminate any or all subtenancies or succeed to the interest of Tenant as
sublandlord thereunder.

     Section 14.6 ASSIGNMENT FEES AND PROCEDURES. In the event Landlord shall be
requested to consent to a sublease, assignment, pledge, encumbrance, or any
other transfer of all or any portion of Tenant's rights hereunder, as specified
in Section 14.1 hereof, Tenant shall pay Landlord a reasonable fee not to exceed
Two Hundred Fifty Dollars ($250.00) to reimburse Landlord for costs and
expenses, excluding attorneys fees which shall be reimbursed pursuant to
Section 17.2 herein, incurred in connection with reviewing Tenant's request for
consent. Tenant's check for the assignment fee shall be delivered to Landlord
concurrent with Tenant's request for consent.

                                   ARTICLE XV
                               DEFAULTS; REMEDIES

     Section 15.1 COVENANTS AND CONDITIONS. Tenant's performance of each of
Tenant's obligations under this Lease is a condition as well as a covenant.
Tenant's right to continue in possession of the Premises is conditioned upon
such performance. Time is of the essence in the performance of all covenants and
conditions.

     Section 15.2 DEFAULTS. Tenant shall be in material default under this
Lease:

                 (a) If Tenant abandons or vacates the Premises or if such
abandonment or vacation of the Premises results in the cancellation of any
insurance described in Section 4.6;

                 (b) If Tenant fails to pay rent or any other charge required to
be paid by Tenant within ten (10) days of when due;

                 (c) If Tenant fails to perform any of Tenant's nonmomenetary
obligations under this Lease for a period of fifteen (15) days after written
notice from

                                       16
<PAGE>

Landlord; provided that if more time is required to complete such performance,
Tenant shall not be in default if Tenant commences such performance within the
fifteen (15) day period and thereafter diligently pursues its completion.
However, Landlord shall not be required to give such notice if Tenant's failure
to perform constitutes a non-curable breach of this Lease. The notice required
by this Paragraph is intended to satisfy any and all notice requirements
imposed by law on Landlord prior to the commencement of an unlawful detainer
action and is not in addition to any such requirement;

                 (d) (i) If Tenant makes a general assignment or general
arrangement for the benefit of creditors; (ii) if a petition for adjudication
of bankruptcy or for reorganization or rearrangement is filed by or against
Tenant and is not dismissed within thirty (30) days; (iii) if a trustee or
receiver is appointed to take possession of substantially all of Tenant's assets
located at the Premises or of Tenant's interest in this Lease and possession is
not restored to Tenant within thirty (30) days; or (iv) if substantially all of
Tenant's assets located at the Premises or of Tenant's interest in this Lease is
subjected to attachment, execution or other judicial seizure which is not
discharged within thirty (30) days. If a court of competent jurisdiction
determines that any of the acts described in this subparagraph (d) is not a
default under this Lease, and a trustee is appointed to take possession (or if
Tenant remains a debtor in possession) and such trustee or Tenant transfers
Tenant's interest hereunder, then Landlord shall receive, as Additional Rent,
the difference between the rent (or any other consideration) paid in connection
with such assignment or sublease and the rent payable by Tenant hereunder.

     Section 15.3 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 prosecutes the same to completion.

     Section 15.4 REMEDIES. On the occurrence of any material default by Tenant,
Landlord may, at any time thereafter, with or without notice or demand and
without limiting Landlord in the exercise of any right or remedy which Landlord
may have:

                 (a) Terminate Tenant's right to possession of the Premises by
any lawful means, in which case this Lease shall terminate and Tenant shall
immediately surrender possession of the Premises to Landlord. In such event
Landlord shall have the immediate right to re-enter the Premises and remove all
persons and property and such property may be removed and stored in a public
warehouse or elsewhere at the cost of, and for the account of Tenant, all
without service of notice or resort to legal process and without being deemed
guilty of trespass, or becoming liable for any loss or damage which may be
occasioned thereby; and Landlord shall be entitled to recover from Tenant all
damages incurred by Landlord by reason of Tenant's default, including (i) the
worth at the time of the award of all Minimum Monthly Rent, Additional Rent and
other charges which were earned or were payable at the time of the termination;
(ii) the worth at the time of the award of the amount by which the unpaid
Minimum Monthly Rent, Additional Rent and other charges which would have been
earned or were payable after termination until the time of the award exceeds the
amount of such rental loss that Tenant proves could have been reasonably
avoided; (iii) the worth at the time of the award of the amount by which the
unpaid Minimum Monthly Rent, Additional Rent and other charges which would have
been payable for the balance of the term after the time of award exceeds the
amount of such rental loss that Tenant proves could have been reasonably
avoided; and (iv) any other amount necessary to compensate Landlord for all the
detriment proximately caused by Tenant's failure to perform its obligations
under this Lease or which in the ordinary course of things would be likely to
result therefrom, including, but not limited to, any costs or expenses incurred
by Landlord in maintaining or preserving the Premises after such default, the
cost of recovering possession of the Premises, expenses of reletting, including
necessary renovation or alteration of the Premises, Landlord's reasonable
attorneys' fees, and any real estate commissions or other such fees paid or
payable. As used in subparts (i) and (ii) above, the "worth at the time of the
award" is computed by allowing interest on unpaid amounts at the rate of fifteen
percent (15%) per annum, or such lesser amount as may then be the maximum lawful
rate. As used in subpart (iii) above, the "worth at the time of the award" is
computed by discounting such amount at the discount rate of the Federal Reserve
Bank of San Francisco at the time of the award, plus one percent (1%). If Tenant
shall have abandoned the Premises, Landlord shall have the option of (i)
retaking possession of the Premises and recovering from Tenant the amount
specified in this Section 15.4(a), or (ii) proceeding under Section 15.4(b);

                                       17
<PAGE>

                 (b) Maintain Tenant's right to possession, in which case this
Lease shall continue in effect whether or not Tenant shall have 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;

                 (c) Pursue any other remedy now or hereafter available to
Landlord under the laws or judicial decisions of the state in which the Premises
Is located.

     Section 15.5 THE RIGHT TO RELET THE PREMISES. Should Landlord elect to
re-enter, as herein provided, or should it take possession pursuant to legal
proceedings or pursuant to any notice provided for by law, it may either
terminate this Lease or it may from time to time without terminating this Lease,
make such alterations and repairs as may be necessary in order to relet the
Premises, and relet said Premises or any part thereof for such term or terms
(which may be for a term extending beyond the term of this Lease) and at such
rental or rentals and upon such other terms and conditions as Landlord in its
sole discretion may deem advisable; upon each such reletting all rentals
received by the Landlord from such reletting shall be applied, first, to the
repayment of any indebtedness other than rent due hereunder from Tenant to
Landlord; second, to the payment of any costs and expenses of such reletting,
including brokerage fees and attorneys' fees and of costs of such alterations
and repairs; third, to the payment of rent due and unpaid hereunder, and the
residue, if any, shall be held by Landlord and applied in payment of future rent
as the same may become due and payable hereunder. If such rentals received from
such reletting during any month are less than that to be paid during that month
by Tenant hereunder, Tenant shall pay any such deficiency to Landlord. Such
deficiency shall be calculated and paid monthly. No such re-entry or taking
possession of said Premises by Landlord shall be construed as an election on its
part to terminate this Lease unless a written notice of such intention be given
to Tenant or unless the termination thereof be decreed by a court of competent
jurisdiction.

     Section 15.6 WAIVER OF RIGHTS OF REDEMPTION. Tenant hereby expressly waives
any and all rights of redemption granted by or under any present or future laws
in the event of Tenant being evicted or dispossessed for any cause, or in the
event of Landlord obtaining possession of the Premises, by reason of the
violation by Tenant of any of the covenants or conditions of this Lease, or
otherwise.

     Section 15.7 CUMULATIVE REMEDIES. Landlord's exercise of any right or
remedy shall not prevent it from exercising any other right or remedy.

     Section 15.8 LATE CHARGES. Tenant hereby acknowledges that late payment by
Tenant to Landlord of rent and other sums due hereunder will cause Landlord to
incur costs not contemplated by this Lease, the exact amount of which will be
extremely difficult and costly to ascertain. Such costs include, but are not
limited to, processing, administrative and accounting charges, and late charges
which may be imposed on Landlord by the terms of any mortgage or trust deed
covering the Premises. Accordingly, if any installment of rent 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, Tenant shall pay to Landlord a
late charge as liquidated damages as that term is used in Section 1671 of the
California Civil Code, equal to ten percent (10%) of such overdue amount. The
parties hereby agree that such late charge represents a fair and reasonable
estimate of the costs Landlord will incur as a consequence 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.

                                   ARTICLE XVI
                             PROTECTION OF CREDITORS

     Section 16.1 SUBORDINATION. Landlord shall have the right to require Tenant
to subordinate this Lease to any ground lease, deed of trust or mortgage
encumbering the Premises, any advances made on the security thereof and any
renewals, modifications, consolidations, replacements or extensions thereof,
whenever made or recorded, provided that the Landlord first obtains from the
ground lessor or lender a written agreement that provides substantially the
following: "As long as Tenant performs its obligations under this Lease, no
foreclosure of, deed given in lieu of foreclosure of, or sale under the
encumbrance, and no steps or procedures taken under the encumbrance, shall
affect Tenant's rights under this Lease. The provisions of this Lease concerning
the disposition of insurance proceeds on destruction of the Premises, and the
provisions of the Lease concerning the disposition of any condemnation award,
shall prevail over any conflicting provisions in the encumbrance." However,
Tenant's right to quiet possession of the Premises during the Lease Term shall
not be disturbed if Tenant pays the rent and

                                       18
<PAGE>

performs all of Tenant's obligations under this Lease and is not otherwise in
default. if any ground lessor, beneficiary or mortgagee elects to have this
Lease prior to the lien of its ground lease, deed of trust or mortgage and gives
written notice thereof to Tenant, this Lease shall be deemed prior to such
ground lease, deed of trust or mortgage whether this Lease is dated prior or
subsequent to the date of said ground lease, deed of trust or mortgage or the
date of recording thereof.

     Section 16.2 ATTORNMENT. If Landlord's interest in the Premises is acquired
by any ground lessor, beneficiary under a deed of trust, mortgagee, or purchaser
at a foreclosure sale, Tenant shall attorn to the transferee of or successor to
Landlord's interest in the Premises and recognize such transferee or successor
as Landlord under this Lease. Tenant waives the protection of any statute or
rule of law which gives or purports to give Tenant any right to terminate this
Lease or surrender possession of the Premises upon the transfer of Landlord's
interest.

     Section 16.3 SIGNING OF DOCUMENTS. Tenant shall sign and deliver any
instrument or documents necessary or appropriate to effectuate or evidence any
such attornment or subordination or agreement to do so. If Tenant fails to do so
within ten (10) days after written request, Tenant hereby makes, constitutes and
irrevocably appoints Landlord, or any transferee or successor of Landlord, the
attorney-in-fact of Tenant to execute and deliver any such instrument or
document.

     Section 16.4 ESTOPPEL CERTIFICATES. Each party, within ten (10) days after
notice from the other party, shall execute and deliver to the other party, in
recordable form, a certificate stating that the Lease is unmodified and in full
force and effect, or in full force and effect as modified, and stating the
modifications. The certificate shall also state the amount of the Minimum
Monthly Rent, the dates to which the Rent has been paid in advance, the amount
of any security deposit or prepaid Rent and any other reasonable information
required for the circumstances.

     Section 16.5 TENANT'S FINANCIAL CONDITION. DELETED

     Section 16.6 MORTGAGEE PROTECTION CLAUSE. Tenant agrees to give any
mortgagees and/or trust deed holders, by registered mail, a copy of any notice
of default, served upon the Landlord, provided that prior to such notice Tenant
has been notified in writing (by way of Notice of Assignment of Rents and
Leases, or otherwise) of the addresses of such mortgagees and/or trust deed
holders, Tenant further agrees that if Landlord shall have failed to cure such
default within the time provided for in this Lease, then the mortgagees and/or
trust deed holders shall have an additional thirty days (30) within which to
cure such default or if such default cannot be cured within that time, then such
additional time as may be necessary if within such thirty days (30) any
mortgagee and/or trust deed holder has commenced and is diligently pursuing the
remedies necessary to cure such default (including but not limited to
commencement of foreclosure proceedings if necessary to affect such cure), in
which event this Lease shall not be terminated while such remedies are being so
diligently pursued.

                                  ARTICLE XVII
                                  LEGAL COSTS

     Section 17.1 LEGAL PROCEEDINGS. Tenant shall reimburse Landlord, upon
demand, for any costs or expenses incurred by Landlord in connection with any
breach or default of Tenant under this Lease, whether or not suit is commenced
or judgment entered. Such costs shall include legal fees and costs incurred for
the negotiation of a settlement, enforcement of rights or otherwise.
Furthermore, if any action for breach of or to enforce the provisions of this
Lease is commenced, the court in such action shall award to the party in whose
favor a judgment is entered, a reasonable sum as attorneys' fees and costs. Such
attorneys' fees and costs shall be paid by the losing party in such action.

     Section 17.2 LANDLORD'S CONSENT. Tenant shall pay Landlord's reasonable
attorneys' fees incurred in connection with Tenant's request for Landlord's
consent under Article XIV (Assignment and Subletting), or in connection with any
other act which Tenant proposes to do and which requires Landlord's consent.

                                  ARTICLE XVIII
                            MISCELLANEOUS PROVISIONS

     Section 18.1 NON-DISCRIMINATION. Tenant promises, and it is a condition to
the continuance of this Lease, that there will be no discrimination against, or
segregation of, any person or group of persons on the basis of race, color, sex,
creed, national origin or ancestry in the leasing, subleasing, transferring,
occupancy, tenure or use of the Premises or any portion thereof.

                                       19
<PAGE>

     Section 18.2 LANDLORD'S LIABILITY; CERTAIN DUTIES. As used in this Lease,
the term "Landlord" means only the current owner or owners of the fee title to
the Premises or the leasehold estate under a ground lease of the Premises at the
time in question. Each Landlord Is obligated to perform the obligations of
Landlord under this Lease only during the time such Landlord owns such interest
or title. Any Landlord who transfers its title or interest is relieved of all
liability with respect to the obligations of Landlord under this Lease to be
performed on or after the date of transfer. However, each Landlord shall deliver
to its transferee all funds previously paid by Tenant if such funds have not yet
been applied under the terms of this Lease.

     Section 18.3 SEVERABILITY. A determination by a court of competent
jurisdiction that any provision of this Lease or any part thereof is illegal or
unenforceable shall not cancel or invalidate the remainder of such provision or
this Lease, which shall remain in full force and effect.

     Section 18.4 INTERPRETATION. The captions of the Articles or Sections of
this Lease are to assist the parties in reading this Lease and are not a part of
the terms or provisions of this Lease. Whenever required by the context of this
Lease, the singular shall include the plural and the plural shall include the
singular. The masculine, feminine and neuter genders shall each include the
other. In any provision relating to the conduct, acts or omissions of Tenant,
the term "Tenant" shall include Tenant's agents, employees, contractors,
invitees, successors or others using the Premises with Tenant's expressed or
implied permission.

     Section 18.5 ENTIRE AGREEMENT. This Lease and the Exhibits, and Rider, if
any, attached hereto and forming a part hereof, set forth all the covenants,
promises, agreements, conditions and understandings, either oral or written,
between Landlord and Tenant concerning the Premises and there are no covenants,
promises, agreements, conditions or understandings, either oral, or written,
between them other than are herein set forth. Except as herein otherwise
provided, no subsequent alteration, amendment, change or addition to this Lease
shall be binding upon Landlord or Tenant unless reduced to writing and signed by
the party to be charged with their performance.

     Section 18.6 NOTICES. All notices required or permitted under this Lease
shall be in writing and shall be personally delivered or sent by certified mail,
return receipt requested, postage prepaid. Notices to Tenant shall be delivered
to the address specified in Section 1.3 herein. Notices to Landlord shall be
delivered to the address specified in Section 1.2 above. All notices shall be
effective upon personal delivery or three (3) days after deposit in the U.S.
Mail. Either party may change its notice address upon written notice to the
other party.

     Section 18.7 WAIVERS. All waivers must be in writing and signed by the
waiving party. Landlord's failure to enforce any provision of this Lease or its
acceptance of rent shall not be a waiver and shall not prevent Landlord from
enforcing that provision or any other provision of this Lease in the future. No
statement on a payment check from Tenant or in a letter accompanying a payment
check shall be binding on Landlord. Landlord may, with or without notice to
Tenant, negotiate such check without being bound to the conditions of such
statement.

     Section 18.8 NO RECORDATION. Tenant shall not record this Lease without
prior written consent from Landlord. However, Landlord may require that a "Short
Form" memorandum of this Lease be executed by both parties and recorded.

     Section 18.9 BINDING EFFECT; CHOICE OF LAW. This Lease binds any party who
legally acquires any rights or interest in this Lease from Landlord or Tenant.
However, Landlord shall have no obligation to Tenant's successor unless the
rights or interests of Tenant's successor are acquired in accordance with the
terms of this Lease. The laws of the state in which the Premises is located
shall govern this Lease.

     Section 18.10 CORPORATE AUTHORITY; PARTNERSHIP AUTHORITY. If Tenant is a
corporation, each person signing this Lease on behalf of Tenant represents and
warrants that he has full authority to do so and that this Lease binds the
corporation. Within five (5) days after this Lease is signed, Tenant shall
deliver to Landlord a certified copy of a resolution of Tenant's Board of
Directors authorizing the execution of this Lease or other evidence of such
authority reasonably acceptable to Landlord. If Tenant is a partnership, each
person signing this Lease for Tenant represents and warrants that he is a
general partner of the partnership, that he has full authority to sign for the
partnership and that this Lease binds the partnership and all general partners
of the partnership. Tenant shall give written notice to Landlord of any general
partner's withdrawal or addition. Within five (5) days after this Lease is
signed, Tenant shall deliver to Landlord a copy of Tenant's recorded statement
of partnership or certificate of limited partnership.

                                      20
<PAGE>

     Section 18.11 NO PARTNERSHIP. Landlord shall not by virtue of this Lease,
in any way or for any purpose, be deemed to have become a partner of Tenant in
the conduct of its business, or otherwise, or joint venturer or a merger of a
joint enterprise with Tenant, nor is Tenant an agent of Landlord for any reason
whatsoever. The provisions of this Lease relating to the percentage rent payable
hereunder are included solely for the purpose of providing a method whereby the
rent is to be measured and ascertained.

     Section 18.12 JOINT AND SEVERAL LIABILITY. All parties signing this Lease
as Tenant shall be jointly and severally liable for all obligations of Tenant.

     Section 18.13 FORCE MAJEURE. If Landlord cannot perform any of its
obligations due to events beyond Landlord's control, the time provided for
performing such obligations shall be extended by a period of time equal to
the duration of such events. Events beyond Landlord's control include, but
are not limited to, acts of God, war, civil commotion, labor disputes,
strikes, fire, flood or other casualty, shortages of labor or material,
government regulation or restriction and weather conditions.

     Section 18.14 NO OPTION. The submission of this Lease for examination does
not constitute a reservation of or option to lease the Premises and this Lease
becomes effective only upon execution and delivery thereof by Landlord and
Tenant.

     Section 18.15 ACCORD AND SATISFACTION. No payment by Tenant or receipt by
Landlord of a lesser amount than the monthly rent herein stipulated shall be
deemed to be other than on account of the earliest stipulated rent, or shall any
endorsement or statement on any check or any letter accompanying any check or
payment as rent be deemed an accord and satisfaction, and Landlord may accept
such check or payment without prejudice to Landlord's right to recover the
balance of such rent or pursue any other remedy provided in this Lease.

     Section 18.16 PROVISIONS ARE COVENANTS AND CONDITIONS. All provisions,
whether covenants or conditions, on the part of the Landlord, or on the part of
Tenant, shall be deemed to be both covenants and conditions.

     Section 18.17 UNION WORKERS. DELETED

     Section 18.18 REMODEL. Landlord may in the future remodel or refurbish
portions of the Shopping Center. Such remodeling and/or refurbishing may include
Tenant's Premises. The remodeling and/or refurbishing will be done in accordance
with the proper architect's design specifications which will be reviewed and
approved by Landlord and copies of such drawings will be made available to
Tenant. Tenant agrees to accept such specifications. Tenant further agrees that
Tenant will not, through any act or omission on the part of Tenant, in any way
hinder, impede, or frustrate the efforts of the Landlord in completing such
remodeling or refurbishing in a timely fashion. Provided, however, Landlord
agrees to perform all work in connection with such remodel or refurbishing in
such a manner that said work shall not materially interfere with access to or
visibility of the Premises. As part of architect's design specifications, a new
exterior Tenant sign criteria may be developed. Upon development of said new
sign criteria Tenant, at Tenant's expense, upon written notice from Landlord,
shall remove all existing signs and replace such exterior signs with a new sign
in accordance with the new sign criteria. Such resigning by Tenant shall be
completed within sixty (60) days after receipt of new sign criteria from
Landlord.

     Section 18.19 OPTION TO EXTEND.

ADDITIONAL PROVISIONS MAY BE SET FORTH IN A RIDER OR RIDERS ATTACHED HERETO OR
IN THE BLANK SPACE BELOW.  IF NO ADDITIONAL PROVISIONS ARE INSERTED, PLEASE
DRAW A LINE THROUGH THE SPACE BELOW.

                                       21
<PAGE>

    Landlord and Tenant have signed this Lease at the place and on the dates
specified adjacent to their signatures below and have initialled all Riders
which are attached to or incorporated by reference in this Lease.

                                  LANDLORD:

DATED: MARCH 14, 1994             FALLBROOK MERCANTILE,
                                  a California general partnership,

                                  By:   /s/ Robert W. Carson
                                        ---------------------------------
                                        Robert W. Carson, General Partner

                                  By:   /s/ Michael R. Perry
                                        ---------------------------------
                                        Michael R. Perry, General Partner

                                  TENANT:

DATED: MARCH 8, 1994              FALLBROOK NATIONAL BANK,
                                  a California corporation

                                  By:   /s/ [ILLEGIBLE]
                                        ---------------------------------
                                        Its: PRESIDENT & CEO
                                             ----------------------------

                                  By:   /s/ [ILLEGIBLE]
                                        ---------------------------------
                                        Its: SENIOR VICE PRESIDENT
                                             ----------------------------

                                       22

<PAGE>

                                  EXHIBIT A

* Landlord and Tenant acknowledge that this plot plan is for general
information purposes only. Landlord shall not be liable and makes no
representation or warranties whatsoever concerning the location of any
buildings or improvements, or tenants whatsoever depicted hereon this plot
plan and any buildings, improvements, and tenants depicted hereon shall be
subject to correction, modification or change at any time without notice at
Landlord's sole discretion.

                                [PLOT PLAN]

<PAGE>

                            FALLBROOK MERCANTILE

                          [DRAWING - SIGN CRITERIA]

<PAGE>

                                   EXHIBIT "X"

                          CONFIRMATION OF TERM OF LEASE

     This Confirmation of Term of Lease is made April 1, 1994, between
FALLBROOK MERCANTILE, a California General Partnership ("Landlord") and
FALLBROOK NATIONAL BANK, a California Corporation ("Tenant"), who agree as
follows:

     1. Landlord and Tenant entered into a Lease dated April 1, 1994, in which
Landlord leased to Tenant and Tenant leased from Landlord the premises described
in Paragraph 1.4 of the Lease (the "Premises").

     2. Pursuant to Paragraph 1.7 of the Lease, Landlord and Tenant agree to
confirm the commencement and expiration dates of the Term, and the commencement
date of rent, as follows:

        a. April 1, 1994, is the Commencement Date of the Term of the Lease;

        b. March 31, 2002, the Expiration Date of the Term of Lease;

        c. April 1, 1994, is the Commencement Date of Rent under the Lease;

        d. April 1, 1994, is the Commencement Date of Other Periodic Payments
under the Lease.

     3. Tenant confirms that:

        a. It has accepted possession of the Premises as provided in the Lease;

        b. The improvements and space required to be furnished by Landlord under
the Lease have been furnished;

        c. Landlord has fulfilled all its duties of an inducement nature;

        d. The Lease has not been modified, altered, or amended, except as
follows:

        NONE;

        e. There are no setoffs or credits against rent, and no security deposit
has been paid except as provided by the Lease;

        f. Tenant has no notice of a prior assignment, hypothecation, or pledge
of rent, or of the Lease; and

        g. The Lease is in full force and effect.

     4. The provisions of this Confirmation of Term of Lease shall inure to the
benefit, or bind, as the case may require, the parties and their respective
successors subject to the restrictions on assignment and subleasing contained in
the Lease.

Landlord:  FALLBROOK MERCANTILE
           A CALIFORNIA GENERAL PARTNERSHIP

By: /s/ Robert W. Carson
    -----------------------------------------
    Robert W. Carson, General Partner

By: /s/ Michael R. Perry
    -----------------------------------------
    Michael R. Perry, General Partner

Tenant:    FALLBROOK NATIONAL BANK
           A CALIFORNIA CORPORATION

By:  /s/ [ILLEGIBLE]
    -----------------------------------------
    Its: PRESIDENT & CEO
    -----------------------------------------

By:  /s/ [ILLEGIBLE]
    -----------------------------------------
    Its: SENIOR VICE PRESIDENT
    -----------------------------------------

<PAGE>

                                     RIDERS

Riders One (1) through Five (5) of that certain Lease, dated March 1 1994, by
and between Fallbrook Mercantile, a California General Partnership ("Landlord")
and Fallbrook National Bank, a California Corporation ("Tenant").

RIDER ONE - SPACE CANCELLATION

Tenant shall have the option to vacate Suite 855-I on June 1, 1994 or April
1, 1995 after providing the Landlord with thirty (30) days written notice of
their intention to vacate. In the event that the Tenant elects to exercise
said option to vacate, Tenant will reinstall the demising wall necessary to
separate the suites as well as make any other construction changes such as
electrical and HVAC to separate the suites and create a separate suite for
Suite I. Additionally, Tenant will leave any carpeting, draperies or other
tenant improvements that have been installed in Suite I. Immediately after
notice has been received by Landlord from Tenant, Landlord will prepare a
Lease Amendment eliminating Suite I from the space and reducing the rental
and impounds effective either June 1, 1994 or April 1, 1995 depending upon
when the election is made in proportion to the reduction in the square
footage (i.e. 1,300 square feet x $1.10 per square foot = $1,430 minimum
monthly rental reduction).

RIDER TWO - SHEAR/LOAD BEARING WALLS

Tenant acknowledges that the demising wall between Suites L and M is a
shear or load-bearing wall and that the Tenant will be limited to creating,
at Tenant's expense, one access doorway in the subject wall. The four foot
(4') access doorway will be located in the immediate front (first four (4)
feet) of the subject demising wall. Tenant agrees to make no other access
penetrations in said shear/load bearing wall.

RIDER THREE - SIGNAGE

Tenant shall be allowed the standard tenant canopy signage on the east and north
elevations of the premises as well as a building sign facing Fallbrook Street
and a monument sign in the planter at the driveway located immediately adjacent
to the premises. Said monument sign may be located on either side of the subject
driveway at the discretion of Fallbrook National Bank. The size and location of
the signage on the north wall shall be approved by Landlord and the governmental
agencies prior to installation. The size of the monument sign will also require
approval by the Landlord and the appropriate governmental agencies prior to
installation.

RIDER FOUR - CONDITION OF THE PREMISES/TENANT IMPROVEMENT ALLOWANCE

In accordance with Section 7.1 of the Lease, Tenant shall take the Premises
in an "as-is" condition. Landlord, prior to the Lease Commencement Date of
the Lease, will have all of the existing restaurant equipment removed from
the Premises. The Landlord will provide a Tenant Improvement Allowance to
Tenant of Four Thousand Five Hundred Seventy-Eight Dollars ($4,578.00) for
tenant improvement construction in 855 Main Avenue, Suites M, N, and 0. Said
allowance will be payable on or before July 1, 1994.

RIDER FIVE - CONTINGENCY

This Lease Agreement is contingent upon Landlord's receipt of final written
approval of the Lease Transaction from Nationwide Life Insurance Company.

<PAGE>

                            FIRST AMENDMENT TO LEASE

THIS FIRST AMENDMENT TO LEASE IS MADE EFFECTIVE AS OF MARCH 1, 1995 BY AND
BETWEEN FALLBROOK MERCANTILE, A CALIFORNIA GENERAL PARTNERSHIP ("LANDLORD") AND
FALLBROOK NATIONAL BANK ("TENANT") WITH REFERENCE TO THE FACTS SET FORTH BELOW.

RECITALS

A.   Landlord and Tenant are parties to that certain lease dated March 1, 1994,
     and hereby express their mutual desire and intent to amend the terms of the
     Lease by this First Amendment to Lease with those terms, covenants, and
     conditions as hereinafter provided.

B.   Landlord leased to Tenant a certain retail space consisting of
     approximately 8,272 square feet identified as 855-I, J, K, L, M, N, and 0
     South Main Avenue, Fallbrook, California 92028 (the "Premises").

C.   Landlord and Tenant desire to amend and modify the lease document effective
     April 1, 1995.

NOW, THEREFORE, IN CONSIDERATION OF THE RECITALS AND FOR OTHER GOOD AND
VALUABLE CONSIDERATION, THE RECEIPT AND SUFFICIENCY OF WHICH ARE HEREBY
ACKNOWLEDGED, THE PARTIES HERETO AGREE AS SET FORTH BELOW.

1.   SECTION 1.4 shall now read, "the original location of the Premises was
     outlined in red on the site plan of the Shopping Center, attached to the
     original Lease as Exhibit "A" and made a part thereof." The Landlord and
     Tenant are now amending the Lease to eliminate Suite 855-I South Main
     Avenue, Fallbrook, California 92028 from the Lease premises. Therefore, the
     revised Premises shall otherwise be known as 855-J, K, L, M, N, and 0 South
     Main Avenue, Fallbrook, California 92028 ("Address"). Said Premises being
     agreed to for the purposes of this Lease to be reduced by eliminating 855-I
     South Main Avenue, Fallbrook, California 92028 and thereby reducing the
     overall square footage by 1,300 square feet, resulting in a total
     approximate area of the new Premises of 6,972 square feet.

2.   SECTION 1.11(a) - MINIMUM MONTHLY RENT shall be Seven Thousand Six
     Hundred Sixty-Nine Dollars and Twenty Cents ($7,669.20) per month for the
     period of April 1, 1995 through March 31, 1996, and shall be increased
     pursuant to Section 1.11(a) of the Lease Agreement.

3.   SECTION 1.11(b) - OTHER PERIODIC PAYMENTS shall be Two Thousand Two
     Hundred Thirty-One Dollars and Four Cents ($2,231.04).

4.   Except as modified herein, the Lease shall remain in full force and effect
     as modified.

IN WITNESS WHEREOF THIS AMENDMENT TO LEASE IS EXECUTED AS OF THE DATE FIRST
WRITTEN ABOVE.

LANDLORD:  FALLBROOK MERCANTILE
           A California General Partnership

By:
    ------------------------------------------
    Robert W. Carson, General Partner

By:
    ------------------------------------------
    Michael R. Perry, General Partner

TENANT:    FALLBROOK NATIONAL BANK
           A California Corporation

By: /s/ [ILLEGIBLE]
   ----------------------------------------
Its:  PRESIDENT/CEO

By: /s/ [ILLEGIBLE]
   ----------------------------------------
Its:  SENIOR VICE PRESIDENT

<PAGE>

                                     RIDERS

Riders One (1) through Five (5) of that certain Lease, dated March 1 1994, by
and between Fallbrook Mercantile, a California General Partnership ("Landlord")
and Fallbrook National Bank, a California Corporation ("Tenant").

RIDER ONE - SPACE CANCELLATION

Tenant shall have the option to vacate Suite 855-I on June 1, 1994 or April
1, 1995 after providing the Landlord with thirty (30) days written notice of
their intention to vacate. In the event that the Tenant elects to exercise
said option to vacate, Tenant will reinstall the demising wall necessary to
separate the suites as well as make any other construction changes such as
electrical and HVAC to separate the suites and create a separate suite for
Suite I. Additionally, Tenant will leave any carpeting, draperies or other
tenant improvements that have been installed in Suite I. Immediately after
notice has been received by Landlord from Tenant, Landlord will prepare a
Lease Amendment eliminating Suite I from the space and reducing the rental
and impounds effective either June 1, 1994 or April 1, 1995 depending upon
when the election is made in proportion to the reduction in the square
footage (i.e. 1,300 square feet x $1.10 per square foot = $1,430 minimum
monthly rental reduction).

RIDER TWO - SHEAR/LOAD BEARING WALLS

Tenant acknowledges that the demising wall between Suites L and M is a
shear or load-bearing wall and that the Tenant will be limited to creating,
at Tenant's expense, one access doorway in the subject wall. The four foot
(4') access doorway will be located in the immediate front (first four (4)
feet) of the subject demising wall. Tenant agrees to make no other access
penetrations in said shear/load bearing wall.

RIDER THREE - SIGNAGE

Tenant shall be allowed the standard tenant canopy signage on the east and north
elevations of the premises as well as a building sign facing Fallbrook Street
and a monument sign in the planter at the driveway located immediately adjacent
to the premises. Said monument sign may be located on either side of the subject
driveway at the discretion of Fallbrook National Bank. The size and location of
the signage on the north wall shall be approved by Landlord and the governmental
agencies prior to installation. The size of the monument sign will also require
approval by the Landlord and the appropriate governmental agencies prior to
installation.

RIDER FOUR - CONDITION OF THE PREMISES/TENANT IMPROVEMENT ALLOWANCE

In accordance with Section 7.1 of the Lease, Tenant shall take the Premises
in an "as-is" condition. Landlord, prior to the Lease Commencement Date of
the Lease, will have all of the existing restaurant equipment removed from
the Premises. The Landlord will provide a Tenant Improvement Allowance to
Tenant of Four Thousand Five Hundred Seventy-Eight Dollars ($4,578.00) for
tenant improvement construction in 855 Main Avenue, Suites M, N, and 0. Said
allowance will be payable on or before July 1, 1994.

RIDER FIVE - CONTINGENCY

This Lease Agreement is contingent upon Landlord's receipt of final written
approval of the Lease Transaction from Nationwide Life Insurance Company.

<PAGE>

                                     RIDERS

Riders One (1) through Five (5) of that certain Lease, dated March 1 1994, by
and between Fallbrook Mercantile, a California General Partnership ("Landlord")
and Fallbrook National Bank, a California Corporation ("Tenant").

RIDER ONE - SPACE CANCELLATION

Tenant shall have the option to vacate Suite 855-I on June 1, 1994 or April
1, 1995 after providing the Landlord with thirty (30) days written notice of
their intention to vacate. In the event that the Tenant elects to exercise
said option to vacate, Tenant will reinstall the demising wall necessary to
separate the suites as well as make any other construction changes such as
electrical and HVAC to separate the suites and create a separate suite for
Suite I. Additionally, Tenant will leave any carpeting, draperies or other
tenant improvements that have been installed in Suite I. Immediately after
notice has been received by Landlord from Tenant, Landlord will prepare a
Lease Amendment eliminating Suite I from the space and reducing the rental
and impounds effective either June 1, 1994 or April 1, 1995 depending upon
when the election is made in proportion to the reduction in the square
footage (i.e. 1,300 square feet x $1.10 per square foot = $1,430 minimum
monthly rental reduction).

RIDER TWO - SHEAR/LOAD BEARING WALLS

Tenant acknowledges that the demising wall between Suites L and M is a
shear or load-bearing wall and that the Tenant will be limited to creating,
at Tenant's expense, one access doorway in the subject wall. The four foot
(4') access doorway will be located in the immediate front (first four (4)
feet) of the subject demising wall. Tenant agrees to make no other access
penetrations in said shear/load bearing wall.

RIDER THREE - SIGNAGE

Tenant shall be allowed the standard tenant canopy signage on the east and north
elevations of the premises as well as a building sign facing Fallbrook Street
and a monument sign in the planter at the driveway located immediately adjacent
to the premises. Said monument sign may be located on either side of the subject
driveway at the discretion of Fallbrook National Bank. The size and location of
the signage on the north wall shall be approved by Landlord and the governmental
agencies prior to installation. The size of the monument sign will also require
approval by the Landlord and the appropriate governmental agencies prior to
installation.

RIDER FOUR - CONDITION OF THE PREMISES/TENANT IMPROVEMENT ALLOWANCE

In accordance with Section 7.1 of the Lease, Tenant shall take the Premises
in an "as-is" condition. Landlord, prior to the Lease Commencement Date of
the Lease, will have all of the existing restaurant equipment removed from
the Premises. The Landlord will provide a Tenant Improvement Allowance to
Tenant of Four Thousand Five Hundred Seventy-Eight Dollars ($4,578.00) for
tenant improvement construction in 855 Main Avenue, Suites M, N, and 0. Said
allowance will be payable on or before July 1, 1994.

RIDER FIVE - CONTINGENCY

This Lease Agreement is contingent upon Landlord's receipt of final written
approval of the Lease Transaction from Nationwide Life Insurance Company.

<PAGE>

                                LEASE TERMINATION

THIS LEASE TERMINATION ("TERMINATION") IS ENTERED INTO THIS 14TH DAY OF
MARCH, 1994 BY AND BETWEEN FALLBROOK MERCANTILE, A CALIFORNIA GENERAL
PARTNERSHIP, HEREINAFTER REFERRED TO AS "LANDLORD," AND FALLBROOK NATIONAL
BANK, HEREINAFTER REFERRED TO AS "TENANT," BASED ON THE FOLLOWING FACTS:

A.   The Landlord and Tenant mutually desire to terminate the Lease
     Agreements, dated January 25, 1990, November 22, 1991, and
     May 17, 1993 by and between the parties.

B.   An accounting of the amounts due under the Leases through March 31, 1994 is
     attached hereto and incorporated herein by this reference as Exhibit A.

C.   The Landlord and Tenant hereto desire to terminate each of the Lease
     Agreements.

THEREFORE, FOR SUFFICIENT CONSIDERATION, THE RECEIPT OF WHICH IS HEREBY
ACKNOWLEDGED, THE PARTIES AGREE AS FOLLOWS:

1.   Effective March 31, 1994, the subject Leases are hereby terminated and of
     no further force and effect subject to the following conditions:

     a.   Tenant and Landlord to execute this Agreement.

     b.   Tenant to remit the amount set forth in Exhibit B to Landlord.

     c.   Tenant and Landlord to execute the New Lease Agreement, dated March
          1, 1994 for Suites I, J, K, L, M, N, and O South Main Avenue,
          Fallbrook, California.

2.   Tenant represents and warrants to Fallbrook Mercantile, that Tenant is the
     sole Tenant under the Leases; that Tenant has full right, power and
     authority to enter into this termination; that Tenant has not assigned its
     interest under these Leases to any other party; that Tenant will indemnify
     Landlord against and discharge any obligations due by Tenant to any
     subcontractors, materialmen, suppliers, or any third parties, due as a
     result of Tenant's occupancy in the subject Premises that could result in
     a lien against the Landlord's fee interest in the subject property.

3.   In the event of any dispute arising out of the termination, the
     prevailing party shall be entitled to reasonable attorneys fees in
     additional to any other remedy or law or equity.

WHEREFORE, THE PARTIES HERETO HAVE EXECUTED THIS TERMINATION ON THE DATE FIRST
WRITTEN ABOVE.

LANDLORD:  FALLBROOK MERCANTILE,
           A CALIFORNIA CORPORATION

By:   /s/ Robert W. Carson                             March 14, 1994
      ---------------------------------                ----------------------
      Robert W. Carson, General Partner                Date

By:   /s/ Michael R. Perry                             March 14, 1994
      ---------------------------------                ----------------------
      Michael R. Perry, General Partner                Date

LESSEE:    FALLBROOK NATIONAL BANK

By:   /s/  [ILLEGIBLE]                                 March 8, 1994
      ---------------------------------                ----------------------
      PRESIDENT & CEO                                  Date

      /s/  [ILLEGIBLE]
      ---------------------------------
      SENIOR VICE PRESIDENT

<PAGE>

                                   EXHIBIT A

Amounts Due: None

<PAGE>

                                LEASE TERMINATION

THIS LEASE TERMINATION ("TERMINATION") IS ENTERED INTO THIS 14TH DAY OF
MARCH, 1994 BY AND BETWEEN FALLBROOK MERCANTILE, A CALIFORNIA GENERAL
PARTNERSHIP, HEREINAFTER REFERRED TO AS "LANDLORD," AND FALLBROOK NATIONAL
BANK, HEREINAFTER REFERRED TO AS "TENANT," BASED ON THE FOLLOWING FACTS:

A.   The Landlord and Tenant mutually desire to terminate the Lease Agreements,
     dated January 25, 1990, November 22, 1991, and May 17, 1993 by and between
     the parties.

B.   An accounting of the amounts due under the Leases through March 31, 1994 is
     attached hereto and incorporated herein by this reference as Exhibit A.

C.   The Landlord and Tenant hereto desire to terminate each of the Lease
     Agreements.

THEREFORE, FOR SUFFICIENT CONSIDERATION, THE RECEIPT OF WHICH IS HEREBY
ACKNOWLEDGED, THE PARTIES AGREE AS FOLLOWS:

1.   Effective March 31, 1994, the subject Leases are hereby terminated and of
     no further force and effect subject to the following conditions:

     a.   Tenant and Landlord to execute this Agreement.

     b.   Tenant to remit the amount set forth in Exhibit B to Landlord.

     c.   Tenant and Landlord to execute the New Lease Agreement, dated March
          1, 1994 for Suites I, J, K, L, M, N, and O South Main Avenue,
          Fallbrook, California.

2.   Tenant represents and warrants to Fallbrook Mercantile, that Tenant is the
     sole Tenant under the Leases; that Tenant has full right, power and
     authority to enter into this termination; that Tenant has not assigned its
     interest under these Leases to any other party; that Tenant will indemnify
     Landlord against and discharge any obligations due by Tenant to any
     subcontractors, materialmen, suppliers, or any third parties, due as a
     result of Tenant's occupancy in the subject Premises that could result in
     a lien against the Landlord's fee interest in the subject property.

3.   In the event of any dispute arising out of the termination, the
     prevailing party shall be entitled to reasonable attorneys fees in
     additional to any other remedy or law or equity.

WHEREFORE, THE PARTIES HERETO HAVE EXECUTED THIS TERMINATION ON THE DATE FIRST
WRITTEN ABOVE.

LANDLORD:  FALLBROOK MERCANTILE,
           A CALIFORNIA CORPORATION

By:   /s/ Robert W. Carson                             March 14, 1994
      ---------------------------------                ----------------------
      Robert W. Carson, General Partner                Date

By:   /s/ Michael R. Perry                             March 14, 1994
      ---------------------------------                ----------------------
      Michael R. Perry, General Partner                Date

LESSEE:    FALLBROOK NATIONAL BANK

By:   /s/  [ILLEGIBLE]                                 March 8, 1994
      ---------------------------------                ----------------------
      PRESIDENT & CEO                                  Date

      /s/  [ILLEGIBLE]
      ---------------------------------
      SENIOR VICE PRESIDENT

<PAGE>

                                   EXHIBIT A

Amounts Due: None<PAGE>

                                     LEASE

     Landlord hereby leases to Tenant and Tenant hereby hires from Landlord
the Premises hereinafter described on the terms and conditions set forth in
this Lease Agreement (hereinafter called this "Lease"), dated for reference
proposes only November 20, 1996.

                              BASIC LEASE PROVISIONS

     The words and figures set forth in Paragraph A to X, inclusive, are part
of this Lease wherever appropriate reference is made thereto, unless they are
expressly modified elsewhere in this Lease.

A.  Landlord:                 Home Savings of America, FSB

B.  Tenant:                   Fallbrook National Bank

C.  Building                  The building consisting of approximately 6,338
                              rentable square feet, and improvements located
                              at 27541 Ynez Road, Temecula, CA 92591

D.  Premises:                 The property described as 27541 Ynez Road,
                              Temecula, CA 92591, consisting of the building
                              and the surrounding walkways, driveways,
                              parking lot, and landscaping, as depicted on
                              the cross-hatched illustration on Exhibit A of
                              this Lease.

E.  Use of Premises:          Tenants shall use the Premises for a bank and
                              other general office business purposes, and for
                              related uses, and shall not permit the premises
                              to be used for any other purpose, without
                              Landlord approval.

F.  Term Commencement Date:   The earlier of Tenant's opening for business or
                              April 1, 1997. In no event will the
                              commencement date be earlier than March 1, 1997.

G.  Termination Date:         March 31, 2007.

H.  Minimum Monthly Rent:     $9,824.00 NNN. (Nine Thousand Eight Hundred
                              Twenty Four Dollars). Subject to annual CPI
                              increases thereafter, however in no event shall
                              the rent in the current year be less than the
                              rent in the prior year.

I.  Security Deposit:         Intentionally deleted.

J.  Prepaid Rent:             $9,824.00 (Nine Thousand Eight Hundred Twenty
                              Four Dollars). (To be applied towards the
                              fourth month's rental).

K.  Index:                    The Consumer Price Index (All Urban customers)
                              - Los Angeles/Anaheim/Riverside - All Items
                              compiled by the U.S. Department of Labor,
                              Bureau of Labor Statistics, 1967 = 100.

L.  Beginning Index:          The index which is published for the month of
                              February 1997.

M.  Comparison Index:         The index which is published for the month of
                              February each succeeding year after 1997.

N.  Real Property Taxes:      Tenant shall pay Landlord for all real property
                              tax, as defined herein; applicable to the Land
                              and Building during the term of this Lease,
                              commencing with the Term commencement date).

                                      1

<PAGE>

O.  Utilities:                Tenant shall pay for all charges for water,
                              sewer, gas, electricity, light, heat, power
                              and trash services rendered directly to the
                              Lease Premises, commencing with the Term
                              commencement date).

P.  Common Area Charges:      Tenant shall be responsible for all Common Area
                              Maintenance, insurance impounds and real estate
                              tax impounds; or reimburse Landlord for such
                              amounts if billed directly to Landlord, or if
                              common area maintenance services are provided
                              by Landlord.

Q.  Brokers:                  CB Commercial Real Estate, Michael Wilder.

R.  Tenant Improvement        None. Space shall be delivered in an "as is"
    Allowance:                condition, provided Landlord shall ensure the
                              electrical systems, HVAC, plumbing, drains and
                              roof are in good condition and good working
                              order.

S.  Landlord's Address:       Home Savings of America, FSB
                              Asset Management Department #2040
                              4900 Rivergrade Road
                              Irwindale, California 91706
    Tenant's Address:         Fallbrook National Bank
                              Attn: President, Chief Financial Officer, or
                              Executive Vice President.
                              130 West Fallbrook Street
                              Fallbrook, Ca 92028

T.  Options:                  Two (2) successive Five (5) year options to
                              renew.

U.  Possession:               Tenant shall be allowed to take possession of
                              the premises immediately following full
                              execution of this lease document, for the
                              purposes of making tenant improvements, and
                              satisfaction of the insurance requirements
                              pursuant to this lease, paragraph 17. Tenant
                              shall begin payment of full net charges on
                              either April 1, 1997 or on opening for
                              business, whichever is earlier, however not to
                              occur before March 1, 1997.

V.  Free Rent:                Months 1, 2, and 3, (after the commencement
                              date), shall be free from base rent. Tenant
                              shall pay all net charges pursuant to section
                              N, O & P above.

W.  ATM Machine:              Landlord shall leave the drive through ATM on
                              the premises, and it will become part of the
                              Tenant's property. Tenant shall be responsible
                              for all maintenance, insurance, repairs, and
                              servicing. Tenant may remove such ATM at the
                              end of Tenant's term.

X.  Furniture:                Landlord shall leave the furniture and
                              equipment on the premises as listed on Exhibit
                              C attached hereto which shall become part of
                              Tenant's property.

                                      2

<PAGE>

                                     LEASE

1.     PREMISES AND COMMON AREAS.

       A.  Subject to the terms and provisions herein contained, Landlord hereby
leases to Tenant and Tenant hereby leases from Landlord the Premises, for the
sole and exclusive use of Tenant and it's employees, agents, and invitees.

       B.  Intentionally Omitted.

2.     TERM. This Lease shall be effective as of the date hereof, but the term
of this Lease shall commence on the Commencement Date and shall continue until
the Termination Date, unless extended or sooner terminated in accordance with
the provisions of this Lease

3.     POSSESSION.

       a.  If Landlord, for any reason whatsoever, cannot deliver possession of
the Premises to Tenant at the commencement of the term hereof, this Lease shall
not be void or voidable, nor shall Landlord be liable to Tenant for any loss or
damage resulting therefrom, nor shall the expiration date of the above term be
in anyway extended, but in that event, all rent shall be abated during the
period between commencement of said term and the time when the Landlord delivers
possession.

       b.  In the event Landlord shall permit Tenant to occupy the Premises
prior to the commencement date of the term, such occupancy shall be subject to
all the provisions of this Lease. Said early possession shall not advance the
termination date herein above provided.

4.     RENT. Tenant agrees to pay to Landlord the Minimum Monthly Rent on or
before the first day of the first full calendar month of the term hereof and a
like sum on or before the first day of each and every successive calendar month
thereafter during the term hereof, except that the fourth month's rent shall be
paid upon the execution hereof. Rent for any period during the term hereof which
is for less than one (1) month shall be a prorated portion of the monthly
installation herein, based upon a thirty (30) day month. Rental shall be paid
to Landlord, without deduction of offset in lawful money of the United States of
America, which shall be legal tender at the time of payment to such person or
place as Landlord may from time to time designate in writing.

      Any costs incurred by Landlord in providing auxiliary aids or services or
in undertaking barrier removal efforts as defined in and pursuant to the
Americans With Disabilities Act of 1990 and the regulations promulgated
thereunder, as the same may be amended or supplemented from time to time, or in
any similar federal, state, or local law or ordinance which are directly
attributable to or arise primarily from Tenant's use or occupancy of the
Premises shall be deemed additional rent, and shall be paid in full by Tenant
within 30 days after Landlord gives Tenant written notice that such cost has
been incurred by Landlord.

      All charges and other costs and expenses which Tenant is required to pay
hereunder, together with all interest and penalties that may accrue thereon
in the event of Tenant's failure to pay such amounts (including interest and
late charges), and all damages, costs and expenses which Landlord may incur by
reason of any default of Tenant or failure on Tenant's part to comply with the
terms of this Lease, including Landlord's reasonable attorneys' fees, shall be
deemed to be additional rent and, in the event of nonpayment by Tenant, Landlord
shall have all rights and remedies with respect thereto as Landlord has for the
nonpayment of Minimum Monthly Rent.

      This Lease is what is commonly called a "Net, Net, Net Lease", it being
understood that the Landlord shall receive the rent set forth in this
Paragraph 4, free and clear of any and all other impositions, taxes, liens,
charges or expenses of any nature whatsoever in connection with the
ownership, leasing and operation of the Premises. In addition to the rent
reserved by this paragraph, Tenant shall pay to the parties respectively
entitled thereto all impositions, insurance premiums, operating charges,
maintenance charges, construction costs and any other charges, costs and
expenses shall constitute additional rent, and upon the failure of Tenant to
pay any of such costs, charges or expenses, Landlord shall have the same
rights and remedies as otherwise provided in this Lease for the failure of
Tenant to pay rent.

                                        3
<PAGE>

4(a).  PERIODIC COST-OF-LIVING ADJUSTMENT. The Minimum Monthly Rent provided
for in section H, shall be subject to adjustment at the commencement of the
escond (2nd) year of the term and each year thereafter ("the Adjustment Date")
as follows:

       If the Index published nearest the Adjustment Date ("Extension Index")
has increased or decreased over the Beginning Index, the Minimum Monthly Rent
for the following year (until the next rent adjustment) shall be set by
multiplying the Minimum Monthly Rent set forth in the Basic Lease Provisions by
a fraction, the numerator of which is the Extension Index and the denominator of
which is the Beginning Index. In no case shall the Minimum Monthly Rent provided
be less than the Minimum Monthly Rent set forth in the Basic Lease Provisions.
On adjustment of the Minimum Rent provided in this Lease, the parties shall
immediately execute a letter stating the new Minimum Monthly Rent.
Notwithstanding the above, in no event shall the current rent be less than the
rent in the prior year.

       If the Index is changed so that the base year differs from that used as
of two (2) months immediately preceding the month in which the term commences,
the Index shall be converted in accordance with the conversion factor published
by the United States Department of Labor, Bureau of Labor Statistics. If the
Index is discontinued or revised during the term, such other government index or
computation with which it is replaced shall be used in order to obtain
substantially the same result as would be obtained if the Index had not been
discontinued or revised.

5.     USE. Tenant shall use the Premises as described in the Basic Lease
Provisions and shall not use or allow the Premises to be used for any other
purpose without the prior written consent of Landlord, which consent shall not
be unreasonably withheld. Tenant shall not use or occupy the Premises in
violation of law or of the certificate of occupancy issued for the Building, and
shall, upon written notice from Landlord, discontinue any use of the Premises
which is declared by any governmental authority having jurisdiction to be a
violation of law or of said certificate of occupancy. Tenant, at its sole cost
and expense, except as may be provided elsewhere in this lease, , agrees to
comply with all laws, rules, regulations and directions of any governmental
authority having jurisdiction which shall, by reason of the nature of Tenant's
use or occupancy of the Premises, impose any duty upon Tenant or Landlord with
respect to the Premises or with respect to the use or occupation thereof. Tenant
shall not do or permit to be done anything which will invalidate or increase the
cost of any fire, extended coverage or any other insurance policy covering the
Building and shall comply with all rules, orders, regulations and requirements
of the Pacific Fire Rating Bureau or any other organization performing a similar
function. Tenant shall promptly, upon demand, reimburse Landlord for any
additional insurance premium charged by reason of Tenant's failure to comply
with the provisions of this Article. Tenant shall not allow the Premises to be
used for any improper, immoral, unlawful or objectionable purpose, nor shall
Tenant cause, maintain or permit any nuisance in, on or about the Premises.
Tenant shall not commit or suffer to be committed any waste in or upon the
Premises.

6.     SURRENDER OF PREMISES. On expiration or termination of the term of the
Lease, Tenant shall surrender to Landlord the Premises and all Tenant's
improvements and alterations in good condition (except for ordinary wear and
tear occurring after the last necessary maintenance made by Tenant and
destruction to the Premises as covered by section 15), except for alterations
made necessary by the removal of any alterations or Tenant's personal property
within the time periods stated in this section.

       Landlord can elect to retain or dispose of in any manner any alterations
or Tenant's personal property that Tenant does not remove from the Premises upon
vacating the Premises, by giving at least 15 days' notice to Tenant. Title to
any such alterations or Tenant's personal property that Landlord elects to
retain or dispose of on expiration of the 15 day period shall vest in Landlord.
Tenant waives all claims against Landlord for any damage to Tenant resulting
from Landlord's retention or disposition of any such alterations or Tenant's
personal property. Tenant shall be liable to Landlord for Landlord's cost of
storing, removing, and disposing of any alterations or Tenant's personal
property.

       If Tenant fails to surrender the Premises to Landlord on expiration of
the term as required by this section, Tenant shall pay Landlord as rent during
any such holdover period one and one-half times the rent due under this Lease,
and Tenant shall agree to indemnify and hold Landlord harmless from all damages
resulting from Tenant's failure to surrender the Premises, including, without
limitation, claims made by a succeeding Tenant or from Landlord from Tenant's
failure to surrender the Premises.

7.     CONSTRUCTION. REPAIRS AND MAINTENANCE. Subject to Paragraph 18 herein
regarding damage and destruction, the parties responsible for construction,
repairs and maintenance are as follows:

                                       4
<PAGE>

       A.  TENANT'S OBLIGATIONS.

           (1)  Tenant shall be entitled to construct such initial leasehold
improvements to the Premises, at the outset of this Lease, as Tenant may
reasonably require in order that the Premises may be used for the purpose herein
specified (herein referred to as "Tenant's Work"). Tenant's Work shall be
performed by a reputable contractor or contractors, who shall be subject to
Landlord's approval, and in accordance with detailed plans and specifications
which shall be prepared by Tenant and submitted to Landlord in advance of the
commencement of Tenant's Work for Landlord's approval. Landlord's approval under
this paragraph shall not be unreasonably withheld.

           (2)  Tenant shall be responsible for all repairs and alterations in
and to the Premises, Building and the facilities and systems thereof, the need
for which arises out of (i) Tenant's use or occupancy of the Premises; (ii) the
installation, removal, use or operation of Tenant's property in the Premises;
(iii) the moving of Tenant's property into or out of the Building; or (iv) the
act, omission, misuse or negligence of Tenant, its agents, contractors,
employees or invitees.

           (3)  If Tenant fails to maintain the Premises in good order,
condition and repair, then Landlord shall give Tenant written notice to perform
such work to maintain the premises in good order, condition and repair within
thirty (30) days of receipt of said notice. If Tenant has not performed such
work at the termination of the thirty (30) days from when Tenant received notice
to perform such work the Landlord shall have the right (but not the obligation)
to do such acts and expend such funds, at the expense of Tenant, as are
reasonably required to perform such work. Any amount so expended by Landlord
shall be paid by Tenant as Additional Rent promptly after demand with interest
at the maximum rate then allowed by law. Landlord shall have no liability to
Tenant for any damage, inconvenience or interference with the use of the
Premises by Tenant's as a result of performing any such work.

           (4)  Tenant shall do all acts required to comply with all applicable
laws, ordinances and rules of any public authority relating to its maintenance
obligations as set forth herein.

           (5)  Except as otherwise expressly provided in this Lease, Landlord
shall have no liability to Tenant, nor shall Tenant's obligations under this
Lease be reduced or abated in any manner whatsoever, by reason of any
inconvenience, annoyance, interruption or injury to business arising from
Landlord's making any reasonable repairs or changes which Landlord is required
by law to make in or to any portion of the Building or the Premises.

           (6)  Tenant shall give Landlord prompt notice of any damage to or
defective condition in any part or appurtenance of the Building's mechanical,
electrical, plumbing, HVAC or other systems serving, located in, or passing
through the Premises.

           (7)  Upon the expiration or earlier termination of this Lease, Tenant
shall return the Premises to Landlord clean and in the same condition as of the
date Tenant took possession, except for normal wear and tear and for any
previously improved reconfiguration. Any damage to the Premises, including any
structural damage, resulting from Tenant's use or from the removal of Tenant's
trade fixtures, furnishings and equipment shall be repaired by Tenant at
Tenant's expense.

       B.  LANDLORD'S OBLIGATIONS. Subject to Paragraph R of the basic lease
provisions, tenant agrees to accept possession of the Premises As Is and neither
Landlord shall be obligated to construct any other Tenant improvements.

8.     ALTERATIONS AND ADDITIONS.

       A.  Except as provided in Article 7, Tenant shall not, without the prior
written consent of Landlord, make any alterations, decorations, additions or
improvements in or to the Premises.

       B.  Tenant covenants and agrees that all work done by Tenant shall be
performed in full compliance with all laws, rules, orders, ordinances,
directions, regulations and requirements of all governmental agencies, offices
and departments having jurisdiction. Tenant further covenants and agrees that
any mechanic's lien filed against the Premises or the Building for work claimed
to have been done for, or materials claimed to have been furnished to Tenant,
will be discharged by Tenant, by bond or otherwise, within thirty (30) days
after the filing thereof, at the cost and expense of Tenant. All alterations,
decorations, additions or improvements upon the Premises, made by Tenant shall,
unless

                                        5

<PAGE>

Tenant elects otherwise, become the property of Landlord, and shall remain upon,
and be surrendered with the Premises, as a part thereof, at the end of the Term.

   C. All articles of personal property and all business and trade fixtures,
machinery and equipment, furniture and movable partitions owned by Tenant or
installed by Tenant at its expense in the Premises (collectively, "Tenant's
Property") shall be and remain the property of Tenant and may be removed by
Tenant prior to Tenant's vacating the Premises, and provided further that Tenant
shall repair any damage caused by such removal. If Tenant shall fail to remove
all of Tenant's Property from the Premises upon termination of this Lease for
any cause whatsoever, Landlord may, at its option, remove the same in any manner
that Landlord shall choose, and store said effects without liability to Tenant
for loss thereof, and Tenant agrees to pay Landlord, as appropriate, upon demand
any and all expenses incurred in such removal, including court costs and
attorneys' fees and storage charges for any length of time that Tenant's
Property shall be in Landlord's or Landlord's possession, or Landlord may, at
its option, without notice, sell Tenant's Property, or any of the same, at
private sale and without legal process, for such price as Landlord may obtain
and apply the proceeds of such sale upon any amounts due Landlord.

9. CONDITION OF PREMISES. Tenant's taking possession of the Premises shall
conclusively establish that the Premises and the Building were at such time in
good and sanitary order, condition and repair.

10. ENTRY BY LANDLORD. Landlord and its authorized representatives shall at any
and all times have the right to enter the Premises, inspect the same, supply
janitorial service and any other service to be provided by Landlord to Tenant
hereunder, to show said Premises to prospective brokers, agents, buyers, tenants
or persons interested in an exchange, to post any notices required or allowed
under the provisions of this Lease, and alter, improve or repair the Premises
and any portion of the Building that Landlord may deem necessary or desirable,
without abatement of rent and may for that purpose erect scaffolding and other
necessary structures where reasonably required by the character of the work to
be performed, always providing that the entrance to the Premises shall not be
blocked thereby, and further providing that the business of Tenant shall not be
interfered with unreasonably. Subject to the foregoing, Tenant hereby waives any
claim for damages or for any injury or inconvenience to or interference with
Tenant's business, any loss of occupancy or quiet enjoyment of the Premises, and
any other loss occasioned thereby. For each of the aforesaid purposes, Landlord
shall at all times have and retain a key with which to unlock all of the doors
in, upon and about the Premises, excluding Tenant's vaults, safes and files, and
Landlord shall have the right to use any and all means which Landlord may deem
proper to open said doors in an emergency, in order to obtain entry to the
Premises without liability to Tenant except for any failure to exercise due care
of Tenant's property. Any entry to the Premises obtained by Landlord by any of
said means, shall not under any circumstances be construed or deemed to be a
forcible or unlawful entry into, or a detainer of, the Premises, or an eviction
of Tenant from the Premises or any portion thereof.

11. UTILITIES AND SERVICES. Utilities and services shall be furnished to the
Premises as provided by the Basic Lease Provisions. Landlord shall not be liable
for damages or otherwise for any failure or interruption of any utility services
or other service furnished to the Premises other than for any interruption which
may result from the negligent or intentional acts of Landlord, their agents,
servants or employees. No such failure or interruption shall entitle Tenant to
terminate this Lease or withhold or abate payment of Rent or other sums due
hereunder.

12. PERSONAL PROPERTY TAXES. Tenant shall pay, or cause to be paid before
delinquency, any and all taxes levied or assessed and which become payable
during the term hereof upon all Tenant's leasehold improvements, equipment,
furniture, fixtures and personal property located in the Premises: except that
which has been paid for by Landlord, or is the standard of the Building. In the
event any or all of the Tenant's leasehold improvements, equipment, furniture,
fixtures and personal property shall be assessed and taxed with the Building,
Tenant shall pay to Landlord its share of such taxes within ten (10) days after
delivery to Tenant by Landlord of a statement in writing setting forth the
amount of such taxes applicable to Tenant's property.

13. REAL PROPERTY TAXES. Upon written notice from Landlord, Tenant shall pay
Landlord the real property tax, as defined herein, applicable to the Premises
during the term of this Lease. 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 Premises by any authority having the
direct or indirect power to tax, including any city, state or federal
government, or any school,

                                        6
<PAGE>

agricultural, sanitary, fire, street, drainage or other improvement district
thereof, as against any legal or equitable interest of Landlord in the Premises
or in the real property of which the Premises are a part, as against Landlord's
right to rent or other income therefrom, and as against Landlord's business of
leasing the Premises.

   If the Premises are not separately assessable, Tenant's liability shall be an
equitable portion of the real property taxes for all of the land and
improvements included within the tax parcel assessed, such proportion to be
determined by Landlord from the respective valuations assigned in the assessor's
work sheets or such other information as may be reasonably available. Landlord's
reasonable determination thereof, in good faith, shall be conclusive.

   If Tenant believes the assessed value of the Premises is greater than the
actual market value, Tenant, with Landlord's prior written consent, which
consent will not be unreasonably withheld, may pursue a reassessment at it's
expense. Landlord shall cooperate with Tenant with such efforts. Tenant assumes
all risk and expenses and liabilities if the request is denied, or in the event
the assessed value is increased as a result of Tenant's request for
reassessment.

14. INDEMNIFICATION. Tenant hereby agrees to indemnify and hold harmless
Landlord against and from any and all claims arising from Tenant's use of the
Premises or the conduct of its business or from any activity, work, or thing
done, permitted or suffered by Tenant in or about the Premises, and further
agrees to indemnify and hold harmless Landlord against and from any and all
claims arising from any breach or default in the performance of any obligation
on Tenant's part to be performed under the terms of this Lease, or arising from
any act, neglect, fault or omission of Tenant, or of its agents or employees,
and from and against all costs, attorneys' fees, expenses and liabilities
incurred in or about such claim or any action or proceeding brought thereon. In
the event any action or proceeding is brought against Landlord by reason of any
such claim, Tenant upon notice from Landlord shall defend the same at Tenant's
expense by counsel approved in writing by Landlord as appropriate, which
approval will not be unreasonably withheld. Tenant, as a material part of the
consideration to Landlord, hereby assumes all risk as between Landlord and
Tenant only of damage to property or injury to persons in, upon or about the
Premises from any cause whatsoever, except that which is caused by the failure
of Landlord to observe any of the terms and conditions of this Lease or the
negligence or intentional act of Landlord, its agents, servants or employees.

15. DAMAGE TO TENANT'S PROPERTY. Landlord shall not be liable for any damage to
property entrusted to Landlord or any of its agents, servants or employees, for
loss of or damage to any property by theft or otherwise, for any injury or
damage to persons or property resulting from fire, explosion, falling plaster,
steam, gas, electricity, water or rain which may leak from any part of the
Building or from the pipes, appliances or plumbing works therein or from the
roof, street, or subsurface or from any other place or resulting from dampness
or any other cause whatsoever, except as may be proximately caused by negligence
or intentional act of Landlord, their agents, servants or employees. Tenant
shall give prompt notice to Landlord in case of fire or accidents in the
Premises or in the Building or of defects therein.

16. SUBROGATION. As long as their respective insurers so permit, Landlord and
Tenant hereby mutually waive their respective rights of recovery against each
other for any loss insured by fire, extended coverage and other property
insurance policies existing for the benefit of the respective parties. Each
party shall obtain any special endorsements, if required by their insurer to
evidence compliance with the aforementioned waiver.

17. INSURANCE. Tenant shall, at Tenant's expense, obtain and keep in force
during the term of this Lease a $1,000,000 Standard Commercial General Liability
policy insuring against all liability of Tenant and its authorized
representatives arising out of and in connection of Tenant's use or occupancy of
the Premises and all areas appurtenant thereto.

   All public liability insurance and property damage insurance shall insure
performance by Tenant of the indemnity provisions of Section 14, and Landlord
shall be named as additional insured by the policy.

   The limit of said insurance shall not, however, limit the liability of the
Tenant hereunder. Tenant may carry said insurance under a blanket policy,
providing, however, said insurance by Tenant shall have a Landlord's protective
liability endorsement attached thereto. If tenant shall fail to procure and
maintain said insurance, Landlord may, but shall not be required to, procure and
maintain same, but at the expense of Tenant. Insurance required hereunder, shall
be in companies rated AVI or better in "Best's Insurance

                                        7
<PAGE>

Guide". Tenant shall deliver to Landlord prior to occupancy of the Premises
copies of polices of liability insurance required herein or certificates
evidencing the existence and amounts of such insurance with loss payable clauses
reasonably satisfactory to Landlord. No policy shall be cancelable or subject to
reduction of coverage except after ten (10) days' prior written notice to
Landlord.

   Notwithstanding any other provision of this Lease to the contrary, Tenant
shall not be entitled to possession of the Premises unless and until
certificate(s) evidencing the existence of said insurance and evidence of
payment of premiums are delivered to Landlord no later than one full business
day prior to commencement of this Lease.

18. DAMAGE OR DESTRUCTION.

    A. In the event the Building is damaged by fire or other perils then Tenant
shall give written notice to Landlord of such event.

    B. Upon any termination of this Lease under this Article, the parties shall
be released thereby without further obligation to the other from the date
possession of the Premises is surrendered to Landlord except for the items which
have therefore accrued and are then unpaid.

    C. Damage - Insured. If, during the term of this Lease, the premises and/or
the building and other improvements in which the premises are located are
totally or partially destroyed, rendering the premises totally or partially
inaccessible or unusable, and such damage or destruction was caused by a
casualty covered under an insurance policy required to be maintained hereunder,
Landlord shall restore the premises and/or the building and other improvements
in which the premises are located into substantially the same conditions as they
were immediately before such damage or destruction; provided that the
restoration can be made under the existing laws and can be completed within one
hundred twenty (120) working days after the date of such destruction or damage.
Such destruction or damage shall not terminate this Lease.

   If the restoration cannot be made in said 120-day period, then within fifteen
(15) days after the parties hereto determine that the restoration cannot be made
in the time stated in this paragraph. Tenant may terminate this Lease
immediately by giving notice to Landlord and the Lease will be deemed canceled
as of this date of such damage or destruction. If Tenant fails to terminate this
Lease and the restoration is permitted under the existing laws, Landlord, at its
option, may terminate this Lease or restore the premises and/or the building and
other improvements in which the premises are located within a reasonable time
and this Lease shall continue in full force and effect. If the existing laws do
not permit the restoration, either party can terminate this Lease immediately by
giving notice to the other party.

   Notwithstanding the above, if the Tenant is the insuring party and if the
insurance proceeds received by Landlord are not sufficient to effect such
repair, Landlord shall give notice to Tenant of the amount required in addition
to the insurance proceeds to effect such repair. Tenant may, at Tenant's option,
contribute the required amount, but upon failure to do so within thirty (30)
days following such notice, Landlord's sole remedy shall be, at Landlord's
option and with no liability to Tenant, to cancel and terminate this Lease. If
Tenant shall contribute such amount to Landlord within said 30-day period,
Landlord shall make such repairs as soon as reasonably possible and this Lease
shall continue in full force and effect. Tenant shall in no event have any right
to reimbursement for any amount so contributed.

D. Damage - Uninsured. In the event that the premises are damaged or destroyed
by a casualty which is not covered by the fire and extended coverage insurance
which is required to be carried under Paragraph 17, then Landlord shall restore
the same; provided that if the damage or destruction is to an extent greater
than ten percent (10%) of the replacement cost of the premises (exclusive of
Tenant's trade fixtures and equipment), then Landlord may elect not to restore
and to terminate this Lease. Landlord must give to Tenant written notice of its
intention not to restore within thirty (30) days from the date of such damage or
destruction, and if not given, Landlord shall be deemed to have elected to
restore and in such event shall repair any damage as soon as reasonably
possible. In the event that Landlord elects to give such notice of Landlord's
intention to cancel and terminate this Lease, then Tenant shall have the right,
within ten (10) days after receipt of such notice, to give written notice to
Landlord to Tenant's intention to repair such damage at Tenant's expense,
without reimbursement from Landlord, in which event the Lease shall continue in
full force and effect and Tenant shall proceed to make such repairs as soon as
reasonably possible. If the Tenant does not give such notice written such 10-day
period, this Lease shall be canceled and be deemed terminated as of the date of
the occurrence of such damage or destruction.

                                        8
<PAGE>

E.    Damage Near the End of the Term. If the premises are totally or partially
destroyed or damaged during the last twelve (12) months of the term of this
Lease, Landlord may, at Landlord's option, cancel and terminate this Lease as of
the date of the occurrence of such damage or destruction by giving written
notice to Tenant of Landlord's election to do so within thirty (30) days after
the date of the occurrence of such damage; provided, however, that if the damage
or destruction occurs within the last twelve (12) months of the term and if,
within fifteen (15) days after the date of such damage or destruction, Tenant
exercises any option to extend the term provided herein, then Landlord shall
restore the premises if obligated to do so as provided in Subparagraph 18(C) or
(D) above.

F.    Abatement of Rent. If the premises are partially or totally destroyed or
damaged and Landlord or Tenant repairs or restores them pursuant to the
provisions of this Paragraph 10, then the rent payable hereunder for the period
during which such damage, destruction, repair or restoration continues shall be
abated in proportion to the degree to which Tenant's reasonable use of the
premises is impaired. Except for the 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.

G.    Trade Fixtures and Equipment. If Landlord is required or elects to restore
the premises as provided in this Paragraph 10, Landlord shall not be required to
restore Tenant's improvements, trade fixtures, equipment or alternations made by
Tenant, such excluded items being the sole responsibility of Tenant to restore
hereunder.

19.   EMINENT DOMAIN.

      a. If any portion of the Premises is taken by condemnation this Lease
shall remain in effect, except that Tenant can elect to terminate this Lease if
Tenant is materially unable to conduct its business in the Premises .

      If Tenant elects to terminate this Lease, Tenant must exercise its right
to terminate pursuant to this section by giving notice to Landlord within 30
days after the nature and the extent of the taking have been finally determined.
If Tenant elects to terminate this Lease as provided in this section, Tenant
also shall notify Landlord of the date of termination, which date shall not be
earlier than 30 days nor later than 90 days after Tenant has notified Landlord
of its election to terminate; except that this Lease shall terminate on the date
of taking if the date of taking falls on a date before the date of termination
as designated by Tenant. If Tenant does not terminate this Lease within the 30
day period, this Lease shall continue in full force and effect, except that
Minimum Monthly Rent shall be equitably reduced.

      b. If a party elects to terminate this Lease, it must terminate the Lease
pursuant to this section by giving notice to the other party within 30 days
after the nature and the extent of the taking have been finally determined. The
party terminating this Lease also shall notify the other party of the date of
termination, which date shall terminate on the date of taking if the date of
taking falls on a date before the date of termination designated in the notice
from the terminating party. If this Lease is not terminated within the 30 day
period, it shall continue in full force and effect.

20.   DEFAULTS AND REMEDIES.

      a.   TENANT'S DEFAULT: The occurrence of any of the following shall
constitute a default by Tenant:

      (1)    Failure to pay rent when due, if the failure continues for five (5)
days after notice has been given to Tenant.

      (2)    Abandonment of the Premises (failure to occupy and operate the
Premises for ten (10) consecutive days shall be deemed an abandonment).

      (3)    Failure to perform any other provision of this Lease if the failure
to perform is not cured within thirty (30) days after notice has been given to
Tenant. If the default cannot reasonably be cured within thirty (30) days,
Tenant shall not be in default of this Lease if Tenant commences to cure the
default within the thirty (30) day period and diligently and in good faith
continues to cure the default.

      (4)    If any petition shall be filed against Tenant in any Court, whether
or not pursuant to any statute of the United States of America or of any state,
in any bankruptcy, reorganization, composition,

                                        9
<PAGE>

extension, arrangement or insolvency proceedings, and Tenant shall thereafter be
adjudicated bankrupt, or if said proceedings shall not be dismissed within
ninety (90) days after the institution of the same, or if any such petition
shall be filed by Tenant or liquidators; or

      (5)    If, in any third party creditor proceedings, a receiver, receiver
and manager, trustee or liquidator shall be appointed for all or a substantial
portion of the Premises, and such receiver, receiver and manager, trustee or
liquidator shall not be discharged within ninety (90) days after the appointment
of such receiver, receiver and manager, trustee or liquidator; or

      (6)    If Tenant makes an assignment for the benefit of creditors.

Notice given under this section shall specify the alleged default and the
applicable Lease provisions, and shall demand that Tenant perform the
provision of this Lease or pay the rent that is in arrears, as the case may
be, within the applicable period of time, or quit the Premises. No such
notice shall be deemed a forfeiture or a termination of this Lease unless
Landlord so elects in the notice.

      b.    LANDLORD'S REMEDIES. Landlord shall have the following remedies if
Tenant commits a default. These remedies are not exclusive; they are cumulative
in addition to any remedies now or later allowed by law.

      (1)   Landlord can continue this Lease in full force and effect, and the
Lease will continue in effect as long as Landlord does not terminate Tenant's
right to possession, and Landlord shall have the right to collect rent when
due. During the period Tenant is in default, Landlord can enter the Premises
and relet them, or any part of them, to third parties for Tenant's account.
Tenant shall be liable immediately to Landlord for all costs Landlord incurs
in re-leasing the Premises, including, without limitation, broker's commissions,
expenses of remodeling the Premises required by the re-leasing, and like costs.
Re-leasing can be for a period shorter or longer than the remaining term of this
Lease. Tenant shall pay to Landlord the rent due under this Lease on the dates
the rent is due, less the rent Landlord receives from any re-leasing. No act by
Landlord allowed by this section shall terminate this Lease unless Landlord
notifies Tenant that Landlord elects to terminate this Lease. After Tenant's
default and for as long as Landlord does not terminate Tenant's right of
possession of the Premises, if Tenant obtains Landlord's consent Tenant shall
have the right to assign or sublet its interest in this Lease, but Tenant shall
not be released from liability.

      (2)    Landlord can terminate Tenant's right to possession of the Premises
at anytime.

      No act by Landlord other than notice to Tenant shall terminate this
Lease. Acts of maintenance, efforts to relet the Premises, or the appointment of
a receiver on Landlord's initiative to protect Landlord's interest under this
Lease shall not constitute a termination of Tenant's right to possession. On
termination, Landlord has the right to recover from Tenant:

             (i). The worth, at the time of the award, of the unpaid rent that
             had been earned at the time of termination of this Lease;

             (ii). The worth, at the time of the award, of the amount by which
             the unpaid rent that would have been earned after the date of
             termination of this Lease until the time of the award exceeds the
             amount of the loss of rent that Tenant proves could have been
             reasonably avoided;

             (iii). The worth, at the time of the award, of the amount by which
             the unpaid rent for the balance of the term after the time of award
             exceeds the amount of the loses of rent that Tenant proves could be
             reasonably avoided; and

             (iv). Any other amount, and court costs, necessary to compensate
             Landlord for all detriment proximately caused by Tenant's default.

      "The worth, at the time of the award," as used in (i) and (ii) of this
section, is to be computed by allowing interest at the rate of 10% per annum.
"The worth, at the time of the award," as referred to iniii of this section, is
to be computed by discounting the amount at the discount rate of the Federal
Reserve Bank of San Francisco at the time of the award, plus 1%.

                                       10
<PAGE>

21.   ASSIGNMENT AND SUBLETTING. Except as a part of an acquisition or merger
(providing surviving entity has a net worth equal or greater to Tenant, and the
use of the Premises has not changed),Tenant shall not either voluntarily or by
operation of law, assign, transfer, mortgage, pledge, hypothecate or encumber
this Lease or any interest therein, and shall not Lease the said Premises or any
part thereof, or any right or privilege appurtenant thereto, or suffer any other
person (the employees, agents, servants and invitees of Tenant excepted) to
occupy or use the Premises, or any portion thereof, without the written consent
of Landlord first had and obtained, which consent shall not be unreasonably
withheld, and a consent to one assignment, subleasing, occupation or use by any
other person shall not be deemed to be a consent to any subsequent assignment,
subleasing, occupation or use by another person. Any such assignment or
subleasing without such consent shall be voidable and shall at the option of the
Landlord, constitute a default under this Lease.

      Any such assignment shall be subject to the following provisions:

      (a) Intentionally omitted.

      (a) EXCESS RENT. Further, if for any proposed assignment or sublease
      Tenant receives rent or other consideration either initially or over the
      term of the assignment orsublease, in excess of the rent called for
      hereunder, or in the case of the sublease of a portion of the Premises
      in excess of such rent fairly allocable to such portion, after
      appropriate adjustments to assure that all other payments called for
      hereunder are taken into account, Tenant shall pay to Landlord as
      additional rent hereunder fifty percent (50%) of the excess of each
      such payment of rent or other consideration received by Tenant promptly
      after its receipt.

      (b) FINANCIAL INFORMATION. Notwithstanding the foregoing, before entering
      into any assignment of this Lease or into a sublease of all or a part of
      the Premises, Tenant shall give written notice to Landlord identifying the
      intended assignee or subtenant by name and address, specifying the terms
      of the intended assignment or Lease and providing Landlord with the
      intended assignee's or subtenant's credit application, income tax returns,
      financial statements and other financial information requested by
      Landlord.

      (c) ATTORNEY FEES FOR REVIEW. In connection with any proposed assignment
      or sublease, if Landlord retains the services of an attorney to review the
      transaction, Tenant shall pay to Landlord all reasonable attorneys' fees
      incurred by Landlord in connection therewith, not to exceed $ 1,000.00.
      Tenant shall pay such attorneys' fees to Landlord within thirty (30) days
      after its receipt of written request therefor from Landlord.

      (d) INVOLUNTARY ASSIGNMENT. No interest of Tenant in this Lease shall be
      assignable by operation of law (including, without limitation, the
      transfer of this Lease by testacy or intestacy). Each of the following
      acts shall be considered an involuntary assignment: (a) if Tenant is or
      becomes bankrupt or insolvent, makes an assignment for the benefit of
      creditors, or institutes a proceeding under the Bankruptcy Act in which
      Tenant is the bankrupt; or if Tenant is a partnership or consists of
      more than one person or entity, if any partner of the partnership or other
      such person or entity is or becomes bankrupt or insolvent, or makes an
      assignment for the benefit of creditors; (b) if a writ of attachment of
      execution is levied on this Lease; and (c) if, in any proceeding or action
      to which Tenant is a party, a receiver is appointed with authority to take
      possession of the Premises. An involuntary assignment shall constitute a
      default by Tenant and Landlord shall have the right to elect to terminate
      this Lease, in which case this Lease shall not be treated as an asset of
      Tenant.

22.   ESTOPPEL CERTIFICATE. Within twenty (20) days following any written
request which Landlord or Tenant may make from time to time, the other party
shall execute and deliver to the requesting party a statement certifying: (i)
the date of commencement of this Lease; (ii) the fact that this Lease is
unmodified and in full force and effect (or, if there have been modifications
hereto, that this Lease is in full force and effect, as modified, and stating
the date and nature of such modifications); (iii) the date to which the rental
and other sums payable under this Lease have been paid; and (iv) the fact that
there are no current defaults under this Lease by either Landlord or Tenant
except as specified in such statement. Landlord's or Tenant's failure to
deliver such statement within such time shall be conclusive upon such party
that this Lease is in full force and effect, without modification, that there
are no uncured defaults in performance by the requesting party, and that not
more than one (1) month's rental has been paid in advance.

                                       11
<PAGE>

23. CHOICE OF LAW. This Lease shall be governed by the laws of the State in
which the Premises are located.

24. SUCCESSORS AND ASSIGNS. The covenants and conditions herein contained,
subject to the provisions as to assignment, apply to and bind the heirs,
successors, executors, administrators and assigns of the parties hereto.

25. ATTORNEYS' FEES. If any action shall be instituted by either of the parties
hereto for the enforcement or interpretation of any of its rights or remedies
under this Lease, the prevailing party shall be entitled to recover from the
losing party all costs incurred by the prevailing party in said action and any
appeal therefrom, including reasonable attorneys' fees to be fixed by the court
therein. Said costs and attorneys' fees shall be included as part of the
judgment in any such action.

THIRD PARTY ACTIONS: If either party becomes a party to any litigation
concerning this Lease or the Premises, or any business or activity conducted
thereon by reason of any act or omission of the other party or its
representatives, and not by any act or omission of the party that becomes a
party to that litigation, or any act or omission of its representatives, the
party that causes the other party to become involved in the litigation shall be
liable to the other party for reasonable attorneys' fees and costs incurred by
it in the litigation.

26. LATE CHARGES. Tenant hereby acknowledges that late payment by Tenant to
Landlord of rent 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 upon Landlord by
terms of any mortgage or trust deed covering the Premises. Accordingly, if any
installment of rent or of a sum due from Tenant shall not be received by
Landlord or Landlord's designee within (10) days after written notice that said
amount is past due, then Tenant shall pay to Landlord a late charge equal to(5%)
percent of such overdue amount. The parties hereby agree such late charges
represent a fair and reasonable estimate of the cost that Landlord will incur by
reason of the late payment by Tenant. Acceptance of such late charges by the
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.

27. INTEREST ON TENANT'S OBLIGATIONS. Tenant agrees that any payment of Minimum
Monthly Rent or any other amount due from Tenant to Landlord under this Lease
which is not paid when due shall bear interest from the due date to the date of
payment at a rate of interest equal to the lesser of four percent (4%) above the
prime lending rate of Wells Fargo Bank, N.A. or any comparable bank or lending
institution selected by Landlord, or the maximum non-usurious rate permitted by
law. Landlord's acceptance of any interest shall not constitute a waiver of
Tenant's default with respect to the overdue amount or prevent Landlord from
exercising any of the other rights and remedies available to Landlord under this
Lease or any law now or hereafter in effect.

28. WAIVER. The waiver by Landlord of any breach of any term, covenant or
condition herein contained shall not be deemed to be a waiver of any subsequent
breach of the same or any other term, covenant or condition herein contained,
nor shall any custom or practice which may grow up between the parties in the
administration of the terms hereof be deemed a waiver of, or in any way effect,
the right of Landlord to insist upon the performance by Tenant in strict
accordance with said terms. The subsequent acceptance of Rent hereunder by
Landlord shall not be deemed to be a waiver of any preceding breach by Tenant of
any term, covenant or condition of this Lease, other than the failure of Tenant
to pay the particular Rent so accepted, regardless of Landlord's knowledge of
such preceding breach at the time of acceptance of such rent.

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

30. NOTICES. Whenever Landlord, Landlord or Tenant shall desire to give or serve
upon the other any notice, demand, request or other communication with respect
to this Lease or with respect to the Premises, each such notice, demand, request
or other communication shall be in writing and shall not be effective for any
purpose unless the same shall be given or served by personal delivery or by
mailing the same to such party or parties by certified or registered mail,
postage prepaid, return receipt requested, at the addresses as defined in the
Basic Lease Provisions or at such other address or addresses as Landlord or
Tenant may from time to time designate by notice to the other party given in the
manner aforesaid.

                                       12
<PAGE>

Every notice, demand, request or communication hereunder sent by mail shall be
deemed to have been given or served as of the third business day following the
date of such mailing.

31. PRIOR AGREEMENTS; AMENDMENTS. This Lease contains all of the agreements of
the parties hereto with respect to any matter covered or mentioned in this
Lease, and no prior agreement or understanding pertaining to any such matter
shall be effective for any other purpose. No provision of this Lease may be
amended or added to except by an agreement in writing signed by the parties
hereto or their respective successors in interest.

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

33. ACCORD AND SATISFACTION. No payment by Tenant or receipt by Landlord of a
lesser amount than the rent payment herein stipulated shall be deemed to be
other than on account of the Rent, nor shall any endorsement or statement on any
check or any letter accompanying any check or payment as rent be deemed an
accord and satisfaction, and Landlord may accept such check or payment without
prejudice to Landlord's right to recover the balance of such rent or pursue any
other remedy provided in this Lease.

34. Intentionally omitted.

35. PARKING. Tenant shall be entitled to park cars and "sign" the parking lot to
regulate parking, pursuant to the rules and regulations Tenant may impose,
subject to the provisions elsewhere in this lease regarding compliance with
applicable laws.

36. LIMITATION ON LIABILITY. Notwithstanding anything to the contrary in this
Lease, Tenant agrees that in the event of default by Landlord hereunder, there
shall be absolutely no personal liability of any person, firm or entity who or
which constitutes or comprises Landlord, and Tenant shall, subject to the rights
of Landlord's mortgagees, look solely to the interest of Landlord in the
Premises and any portion of the real property owned by Landlord in which the
Premises are located for the satisfaction of each and every remedy of Tenant
therefor. In this regard, neither Landlord nor any of its partners, officers,
employees, or agents shall be personally liable for any such default or for any
deficiency. The provisions of this section are not intended to limit the
Tenant's rights to seek injunctive relief or specific performance, or Tenant's
rights with respect to the proceeds of insurance, if any, specifically
maintained by Landlord for Tenant's benefit. The foregoing limitations shall
also apply to any successor to Landlord's interest in the Premises.

In the event of any sale by Landlord of its fee interest in the Premises,
Landlord shall be and is hereby entirely freed and relieved of all liability
under any and all of its covenants and unaccrued obligations contained in or
derived from this Lease arising out of any act, occurrence or omission occurring
after the consummation of such sale; provided that the purchaser, at such sale
or any subsequent sale of the Premises, shall in writing covenant with Tenant to
carry out any and all of the covenants and obligations of Landlord under this
Lease.

37. CORPORATE AUTHORITY. If Tenant is a corporation, each individual executing
this Lease on behalf of said corporation represents and warrants that he is duly
authorized to execute and deliver this Lease on behalf of said corporation, in
accordance with a duly adopted resolution of the board of directors of said
corporation or in accordance with the by-laws of said corporation, and that this
lease is binding upon said corporation in accordance with its terms.

38. JOINT OBLIGATION. If there be more than one Tenant, the obligations
hereunder imposed upon Tenants shall be joint and several.

39. MARGINAL HEADINGS. The marginal headings and section titles are not a part
of this Lease and shall have no effect upon the construction or interpretation
of any part hereof.

40. SUCCESSORS AND ASSIGNS. The covenants and conditions herein contained,
subject to the provisions as to assignment, apply to and bind the heirs,
successors, executors, administrators and assigns of the parties hereto.

41. RECORDATION. Tenant shall not record this Lease or a short form memorandum
hereof without the prior written consent of the Landlord.

                                       13
<PAGE>

42. QUIET POSSESSION. Upon Tenant paying the rent reserved hereunder and
observing and performing all the covenants, conditions and provisions on
Tenant's part to be observed and performed hereunder, Tenant shall have quiet
possession of the Premises for the entire term hereof, subject to all the
provisions of this Lease.

43. INABILITY TO PERFORM. This Lease and the obligations of Tenant hereunder
shall not be affected or impaired because Landlord is unable to fulfill any of
its obligations hereunder or is delayed in doing so, if such inability or delay
is caused by reason of strike, labor troubles, acts of God, or any other cause
beyond the reasonable control of Landlord.

44. SUBORDINATION. ATTORNMENT. Upon request of Landlord, Tenant will in writing
subordinate its right hereunder to the lien of any first mortgage, or first deed
of trust to any bank, insurance company or other lending institution, now or
hereafter in force against the land and Building, and to all advances made or
hereafter to be made upon the security thereof.

     In the event any proceedings are brought for foreclosure, or in the
event of the exercise of the power of sale under any mortgage or deed of
trust made by the Landlord covering the Premises, Tenant shall attorn to the
purchaser upon any such foreclosure or sale and recognize such purchaser as
Landlord under this Lease.

     The provisions of this Paragraph 14 to the contrary notwithstanding, and
so long as Tenant is not in default hereunder, this Lease shall remain in
full force and effect for the full term hereof.

45. CUMULATIVE REMEDIES. No remedy or election hereunder shall be deemed
exclusive but shall, whenever possible, be cumulative with all other remedies at
law or in equity.

46. SIGNS AND AUCTIONS. Tenant shall not place any sign upon the outside of the
Building or conduct any auction not within the normal course of Tenant's
business, without Landlord's prior written consent, which consent shall not be
unreasonably withheld. Tenant will have the monument sign as it stands with no
modifications, unless required by the City of Temecula. Should a change to the
sign be requested, approval of the change to the monument would require approval
of Tenant. Tenant is responsible for all governmental approvals and permits for
new building signage.

47. OPTIONS TO EXTEND. Landlord hereby grants Tenant two (2) options to extend
the Term of this Lease beyond the initial Term. Each option shall be for five
(5) year each. Each extension of the Term of this Lease for the Option Period
shall be upon the same terms and conditions as those herein specified as
applicable to the initial Term of this Lease except that Minimum Monthly Rent
shall be at the then fair market value.

If Tenant elects to exercise the Option, Tenant must do so by giving Landlord
written notice of such election not more than eighteen (18) months and not less
than six (6) months prior to the expiration of the then Term of this Lease. A
condition precedent to the effective exercise of each Option to extend the Term
shall be that Tenant shall not be in material default hereunder (or would be in
default but for the passage of time or the giving of notice, or both) either at
the time of giving notice of Tenant's election to exercise an Option or on the
effective date of the beginning of the applicable Option Period or at any time
between such dates. If Tenant properly gives notice of exercise of an Option
hereunder and the conditions thereto are satisfied, then the Term of this Lease
shall be extended for the additional Option Period covered by the Option which
is exercised. The Options granted herein are personal to the original Tenant
named herein and may not be transferred or assigned, whether separate from or as
an incident to an assignment or other transfer of Tenant's interest under this
Lease. Any attempted assignment or transfer of any Option shall cause the Option
in question to automatically cease and terminate and, in such event, this Lease
shall terminate upon the expiration of the then applicable Term. This limitation
on transfer of the option does not apply, however, to an assignment of the
lease, with option, to a successor entity to Tenant following acquisition or
merger. (as per paragraph 21).

   (a) As used in this Section, the term "fair market rental rate" means the
annual amount per rentable square foot, projected during the relevant period,
that a willing, comparable, non-equity tenant (excluding sublease and assignment
transactions) would pay, and a willing, comparable landlord of a comparable
building in the area in which the Premises are located would accept, at arm's
length for an office of comparable size, quality and floor height and area as
the leased Premises taking into account the age, quality and layout of the
existing improvements in the leased area at issue and the condition of the

                                       14
<PAGE>

building and taking into account items that professional real estate brokers
customarily consider, including, but not limited to, rental rates, space
availability, condition of existing improvements, tenant size, tenant
improvement allowances, operating expenses and allowances, reduced rent, free
rent, area demographics, traffic and any other lease concessions, if any, then
being charged or granted by Landlord or the lessors of such similar office
buildings. The fair market rental rate will be an effective rate, not
specifically including, but accounting for, the appropriate economic concessions
described above.

   (b) Landlord will provide written notice of Landlord's determination of the
fair market rental rate ("FMRR") and the new rent rate not later than thirty
(30) days after the date upon which Tenant timely exercises its Option. Tenant
will have thirty (30) days ("Tenant's Review Period") after receipt of
Landlord's notice of the FMRR within which to accept such FMRR or to reasonably
object thereto in writing. Tenant's failure to object to the FMRR submitted by
Landlord in writing within Tenant's Review Period will conclusively be deemed
Tenant's approval and acceptance thereof. If Tenant reasonably objects to the
FMRR submitted by Landlord within Tenant's Review Period, Landlord and Tenant
will attempt in good faith to agree upon such FMRR using their best good faith
efforts. If Landlord and Tenant fail to reach agreement on such FMRR within
fifteen (15) days following the expiration of Tenant's Review Period (the
"Outside Agreement Date"), then each party's determination will be submitted to
appraisal in accordance with the provisions below.

   (c)     (i) Landlord and Tenant will each appoint one independent
appraiser who by profession must be a real estate broker who has been active
over the five (5) year period ending on the date of such appointment in the
leasing of offices located in area in which the Premises are located. Each
such appraiser will be appointed within fifteen (15) days after the Outside
Agreement Date.

           (ii) The two appraisers selected shall agree upon the FMRR and if the
two appraised rental rates are within 10% of one another, the FMRR shall be the
average of the two rates established by the appraisers. If the two selected
appraisers cannot agree on the FMRR within 10%, the two appraisers will within
fifteen (15) days agree upon and appoint a third appraiser who shall be
qualified under the same criteria set forth herein above for qualification of
the initial two appraisers and the FMRR shall be determined within sixty (60)
days by the average of the three appraised rental rates established by the three
appraisers.

           (iii) If either Landlord or Tenant fails to appoint an appraiser
within the time period specified in Subsection (c)(i) herein above, the
appraiser appointed by one of them will, within thirty (30) days following the
date on which the party failing to appoint an appraiser could have last
appointed such appraiser, establish the FMRR and notify Landlord and Tenant
thereof, and such appraiser's decision will be binding upon Landlord and Tenant.

           (iv) The cost of appraisal (and, if necessary, arbitration) will be
shared by Landlord and Tenant equally.

           (v) If the process described in Subsection (b) above and this
Subsection (c) has not resulted in a determination of the fair market rental
rate by the commencement of the applicable lease term, then the fair market
rental rate estimated by Landlord will be used until the appraiser(s) reach a
decision, with an appropriate rental credit and other adjustments for any
overpayments of Minimum Monthly Rent or other amounts based on the final
determination of the fair market rental rate.

48. ASBESTOS SURVEY. Landlord has surveyed the Building for asbestos containing
materials the results of which are attached hereto as exhibit D. Tenant
acknowledges the receipt of this information by the execution of this Lease.

49. BROKERS. Tenant warrants that it has had no dealings with any real estate
broker or agents in connection with the negotiation of this Lease other than
Broker(s) listed in section Q, and it knows of no other real estate broker or
agent who is entitled to commission in connection with this Lease. Landlord
shall pay the broker commission as agreed by agreement to the Brokers upon the
execution of the Lease.

50. RULES AND REGULATIONS. The rules and regulations attached to this Lease as
Exhibit B are made a part of this Lease and Tenant shall comply with them.
Landlord shall have the right from time to time to promulgate reasonable
amendments and reasonable additional rules and regulations for the safety, care,
and cleanliness of the Premises, including the Building, or for the preservation
of good order. On delivery of a copy of such amendments and additional rules and
regulations to Tenant, Tenant shall

                                     15
<PAGE>

comply with the rules and regulations, and a violation of any of them shall
constitute a default by Tenant under this Lease.

51. Intentionally omitted.

52. PRIOR AGREEMENTS. This Lease contains all of the agreements of the parties
hereto with respect to any matter covered or mentioned in this Lease, and no
prior agreements or understanding pertaining to any such matters shall be
effective for any purpose. No provision of this Lease may be amended or added to
except by an agreement in writing signed by the parties hereto. This Lease shall
not be effective or binding on any party until fully executed by both parties
hereto.

Attached hereto and made a part hereof, are exhibits A, B, C and D.

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

LANDLORD:

HOME SAVINGS OF AMERICA, FSB

By: /s/         [ILLEGIBLE]                   Title: Assistant Vice President
    ---------------------------------                -------------------------

TENANT:

FALLBROOK NATIONAL BANK

By: /s/ Gary Youmans                          Title: Executive Vice President
    ----------------------------------               -------------------------
    Gary Youmans

By:                                           Title:
    ----------------------------------               -------------------------

                                       16
<PAGE>

                                   EXHIBIT A

                                LEASED PREMISES

                                 [SITE PLAN]

<PAGE>

                                   Exhibit B

                              Rules and Regulations

1.   No sign, placard, picture, advertisement, name or notice shall be
inscribed, displayed or printed or affixed on or to any part of the outside
of the Building, without first obtaining the written consent of Landlord,
which consent will not be unreasonably withheld Landlord shall have the right
to remove any such sign, placard, picture, advertisement, name or notice (if
installed without Landlord's prior written approval), without notice to and
at the expense of Tenant.

     Tenant shall not place anything or allow anything to be placed near the
glass of any window, door, partition or wall which may appear unsightly from
outside the Premises; provided, however, that Landlord may furnish and install a
Building standard window covering at all exterior windows. Tenant shall not
without prior written consent of Landlord cause or otherwise sunscreen any
window.

2.   Intentionally omitted.

3.   Intentionally omitted.

4.   The toilet room, urinals, wash bowls and other apparatus shall not be used
for any purpose other than that of which they were constructed and no foreign
substance of any kind whatsoever shall be thrown therein and the expense of any
breakage, stoppage or damage resulting from the violation of this rule shall be
borne by the Tenant who, or whose employees or invitees shall have caused it.

5.   Tenant shall not overload the floor of the Premises or in any way deface
the Premises or any part thereof.

6.   Landlord shall have the right to prescribe the weight, size and position
of all safes and other heavy equipment brought into the Building and also the
times and manner of moving the same in and out of the Building. Safes or
other heavy objects shall, if considered necessary by Landlord, stand on
supports of such thickness as is necessary to properly distribute the weight.
Landlord will not be responsible for loss of or damage to any such safe or
property from any cause and all damage done to the Building by moving or
maintaining any such safe or other property shall be repaired at the expense
of Tenant.

7.   Tenant shall not use, keep or permit to be used or kept any foul noxious
gas or substance in or on the Premises, except those used in a normal office
environment, or permit or suffer the Premises to be occupied or used in a
offensive or objectionable manner.

8.   No cooking shall be done or permitted by any Tenant on the Premises,
(except in a typical business environment), nor shall the Premises be used
for storage of merchandise, for washing clothes, for lodging, or for any
improper, objectionable or immoral purposes.

9.   Tenant shall not use or keep in the Premises or the Building any kerosene,
gasoline or inflammable or combustible fluid or material, or any toxic material,
or use any method of heating or air conditioning other than that supplied by
Landlord.

                                       18
<PAGE>

10.  Landlord will direct electricians as to where and how telephone and
telegraph wires are to be introduced. No boring or cutting for wires will be
allowed without the consent of the Landlord. The location of telephones, call
boxes and other office equipment affixed to the Premises shall be subject to
the approval of Landlord. Tenant shall use only contractors designated by
Landlord for all phone work done in the building's main phone terminal room.
All approvals hereunder shall not be unreasonably withheld.

11.  Intentionally omitted.

12.  Landlord reserves the right to exclude or expel from the Building any
person who, in the judgment of Landlord, is intoxicated or under the
influence of liquor or drugs, or who shall in any manner do any act in
violation of any of the rules and regulations of the Building.

13.  Intentionally omitted.

14.  Landlord shall have the right, exercizable without notice and without
liability to Tenant, to change the name and street address of the Building of
which the Premises are a part.

15.  Intentionally omitted.

16.  Intentionally omitted.

17.  Intentionally omitted.

18.  All entrance doors in the Premises shall be left locked when the Premises
are not in use, and all doors opening to public corridors shall be kept closed
except for normal ingress and egress from the Premises.

19.  Intentionally omitted

20.  Intentionally omitted.

21.  Users of the parking area will obey all posted signs and park only in
the areas designated for vehicles parking.

22.  Unless otherwise instructed, every person using the parking area is
required to park and lock his own vehicle. Landlord will not be responsible
for any damages to vehicles, injury to persons or loss of property, all of
which risks are assumed by the party using the parking area.

23.  Intentionally omitted.

24.  Tenant shall be responsible for seeing that all of its employees,
subtenants, agents, or invitees comply with the applicable parking rules,
regulations, laws and agreements.

25.  Landlord reserves the right to modify these rules and/or adopt such other
reasonable and nondiscriminatory rules and regulations consistent with the scope
of the rules herein, as it may deem necessary for the proper operation of the
parking area.

26.  Such parking use as is herein provided is intended merely as license only
and no bailment is intended or shall be created hereby.

                                       19
<PAGE>

                                    Exhibit C
                                (Furniture list)

                                       20
<PAGE>

                                    Exhibit D

                               (Asbestos Survey)

[LOGO]
HOME SAVINGS
OF AMERICA (FSB)

Property Management - Dept. 2780 - 2500 Pellissier Place  - Whittier -
California 90601-1505
Area Code (310) 908-2775 - FAX (310) 908-2774

Manager                                                    December 18, 1995
27541 Ynez Road
Temecula, California

                          ANNUAL ASBESTOS NOTIFICATION

At the request of Home Savings of America, Environmental Risk Department, The
Earth Technology Corporation conducted a survey for asbestos-containing
materials in the building located at 27541 Ynez Road, Temecula, California , on
March 19, 1993. The survey included visual observation of accessible areas,
construction material sampling and laboratory analysis. The Earth Technology
Corporation conducted the survey and laboratory analysis using procedures which
meet or exceed applicable state and federal government agency regulations. . An
Asbestos Survey Report was delivered to Home Savings of America confirming the
presence of asbestos-containing materials (ACM) in the facility. The report
contents include report conclusions, sampling and laboratory procedures, sample
logs, and specific sample locations. Employees may review the report during
normal business hours at the office of the branch manager.

Construction material sampled and found to contain asbestos were as follows:

<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------
ASBESTOS CONTAINING MATERIALS                                        LOCATION
-----------------------------------------------------------------------------------------------
<S>                                         <C>
12"x12" Vinyl Floor Tile & Mastic,          Safe/Storage Room, Storage Room #2 & 3, Janitorial
Roof Tar Patch, Gray                        Room, Kitchen Roof/Penetrations & Devices
-----------------------------------------------------------------------------------------------
</TABLE>

Asbestos is a chemical known to cause cancer and other serious diseases.
Asbestos-containing materials (ACM) generally do not pose a health threat
unless the asbestos fibers are disturbed, become airborne and are inhaled.
However, most people with asbestos related lung diseases were exposed to high
levels while working directly with asbestos products. Although job functions
of most employees do not require contact with ACM, it is important to follow
proper work practice to minimize potential for disturbing ACM and remember
the following rules:

     1.   Do not touch or handle any ACM,
     2.   Do not drill, cut or damage any ACM,
     3.   Immediately report any damaged ACM to your appropriate supervisor and
          building manager.

An Operations and Maintenance (O&M) Program has been developed for the safe
management of ACM in the building. Procedures and specialized asbestos training
is provided for employees whose work may involve contact with ACM.

This notice is provided to you in compliance with California Health and Safety
Code #25915 et seq. YOU SHOULD BE AWARE THAT YOU ARE REQUIRED TO PROVIDE THIS
INFORMATION TO YOUR EMPLOYEES WITHIN 15 DAYS OF RECEIPT OF THIS NOTICE (NEW
EMPLOYEES MUST BE NOTIFIED WITHIN 15 DAYS OF START DATE).

For more information regarding potential health risks and general procedures and
handling restrictions for asbestos, contact your local, state or federal public
health agencies. For specific information regarding ACM in this facility, you
may call Home Savings Environmental Risk Management Department at
(818) 814-7987.

Sincerely,

Property Management Department

HOME SAVINGS OF AMERICA, F.S.B.

                                      21

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