Document:

EXHIBIT 10.3
                          WORLD WASTE OF AMERICA, INC.
                             EMPLOYMENT CONTRACT FOR
                                FRED V. LUNDBERG

         This employment Agreement is effective as of this 1st day March 2004,
by and between World Waste of America, Inc. (hereinafter "Employer") located at
3849 Pala Mesa Dr, California 92028 and Fred V. Lundberg (hereinafter
"Executive") residing at 1095 N. Desert Deer Pass, Green Valley, AZ. 85614-5528

A.                Employer desires assurance of the continued association and
                  services of Executive in order to retain his experience,
                  abilities, and knowledge, and is therefore willing to engage
                  his services on the terms and conditions set forth below.
B.                Executive desires to be employed by Employer and is willing to
                  do so on the terms and conditions set forth below.

         NOW THEREFORE, in consideration of the above recitals and of the mutual
promises and conditions in this Agreement, it is agreed as follows:

1. Term of Employment. Subject to earlier termination as provided in this
Agreement, Executive shall be employed for a term beginning on March 1, 2004
through February 28, 2009. It is intended that upon termination of this
Agreement Executive may continue in the employ of Employer on an at-will basis.

2. Place of Employment. Unless the parties agree otherwise, during the
employment term Executive shall perform the services he is required to perform
under this Agreement at his home office or at Employer's offices, which are
currently located at 3849 Pala Mesa Dr., Fallbrook, California 92028, provided,
however, that Employer may from time to time require Executive to travel
temporarily to other locations on Employer's business.

3. Executive's Duties and Authority. Executive shall be World Waste of America's
Senior Vice President, with full power and authority to manage and conduct all
the day to day business of Employer, subject to the directions and policies of
Employer's board of directors as they may be, from time to time, stated either
orally or in writing. Executive shall not however, take any of the following
actions on behalf of Employer without the approval of the board of directors:

         3.1. Borrowing or obtaining credit in any amount or executing any
         guaranty;
         3.2. Expending funds for major capital equipment;
         3.3 Selling or transferring capital assets exceeding Fifty Thousand
         Dollars ($50,000.00) in market value;
         3.4. Executing any contract or making any commitment for the purchase
         or sale of Employer's products or facilities in an amount exceeding
         Five Hundred Thousand Dollars ($500,000.00);
         3.5. Executing any lease of real or personal property providing for an
         annual rent in excess of One Hundred Thousand Dollars ($100,000.00);
         3.6. Exercising any discretionary authority or control over the
         management of any employee welfare or pension benefit plan or over the
         disposition of the assets of any such plan;
         3.7. Hiring or firing any employee with annual compensation exceeding,
         One Hundred Thousand Dollars ($100,000.00).

                                     10.3-1

<PAGE>
4. Reasonable Time and Effort Required. During his employment, Executive shall
devote such time, interest, and effort to the performance of services as
delineated in this Agreement as may be fairly and reasonably necessary.

5. Annual Salary. Annual Salary shall be as follows:
         March 1, 2004--February 28, 2005: $152,000.00 (One Hundred Fifty-two
         Thousand Dollars)
         March 1, 2005--February 28, 2006: $202,000.00 (Two Hundred Two Thousand
         Dollars)
         March 1, 2006--February 28, 2007: salary subject to board approval
         March 1, 2007--February 28, 2008: salary subject to board approval
         March 1, 2008--February 28, 2009: salary subject to board approval

Annual salary shall be payable in bi-weekly installments, subject to all
applicable withholdings and deductions.

6. Salary Adjustments. In addition to the Annual Salary as set forth above,
Executive may also be entitled to an additional salary increase based upon
Executive's performance in his position, the amount of time which the position
requires, and any other such considerations as the Board of Directors may deem
appropriate. Employer's board of directors shall review Executive's Annual
Salary in year three and annually thereafter. Following such review, the board
may in its discretion increase (but shall not be required to increase)
Executive's salary or any other benefits, but may not decrease Executives' Base
or Adjusted Salary during the Term of this Agreement without the written consent
of all Parties.

7. Stock Award. On or before the execution of this Agreement, Steve Racoosin,
President and Founder of the Company will sell sixty six (66) shares of common
stock of World Waste of America, Inc. (representing a six point six percent
(6.6%) interest in Employer) to Executive at the nominal price of $0.10 per
share. The Shares, when issued, will be fully vested and will be voting shares.
Executive's vested percentage of the outstanding stock of Employer shall be
non-dilutable unless Executive agrees to dilute his interest in Employer, in
writing.

8. Indemnification. Employer shall, to the maximum extent permitted by law, and
its bylaws, indemnify and hold Executive harmless for any acts or decisions made
in good faith while performing services for Employer. To the same extent,
Employer will pay, and subject to any legal limitations, advance all expenses,
including reasonable attorney fees and cost of court-approved settlements,
actually and necessarily incurred by Executive in connection with the defense of
any action, suit or proceeding and in connection with any appeal, which has been
brought against Executive by reason of his service as an officer or agent of
Employer.

9. Termination.

9.1 TERMINATION FOR CAUSE. Employers Board of Directors may terminate this
Agreement at any time without notice if Executive commits any material act of
dishonesty or moral turpitude, is guilty of disloyalty or fraud, or gross
misconduct under this Agreement or with respect to any subsidiary or affiliate
of Employer. In the event of Executive's termination for cause, Executive shall
not be entitled to any sums beyond those accrued for his employment up to the
time of termination.

                                     10.3-2

<PAGE>
9.2. TERMINATION ON RESIGNATION. Executive may terminate this Agreement by
giving Employer three (3) months prior notice of resignation, and Executive
covenants to remain in his position until a replacement executive is found at
the discretion of the Board of Directors.

9.3. TERMINATION BECAUSE OF DISABILITY. If, at the end of any calendar month
during the term of this Agreement, Executive is and has been for the three (3)
consecutive full calendar months then ending, or for thirty percent (30%) or
more of the normal working days during the twelve (12) consecutive full calendar
months then ending, unable due to mental or physical illness or injury to
perform duties under this Agreement in his normal and regular manner, this
Agreement may then be terminated by Employer's Board of Directors.

9.4. TERMINATION ON DEATH. If Executive dies during the initial term or during
any renewal term of this Agreement, the salary provisions of this Agreement
shall be terminated twelve (12) months thereafter, notwithstanding the
provisions of Sections 9, 10, 11 and 12 of this Agreement which shall survive
Executives death.

9.5. RIGHTS AND OBLIGATIONS AFTER NOTICE OF TERMINATION. If Executive gives
notice of termination of this Agreement under Section 11, or if it becomes known
that this Agreement will otherwise terminate in accordance with its provisions,
Employer's Board of Directors may, in its sole discretion and subject to its
other obligations under this Agreement, relieve Executive of his duties under
this Agreement and assign Executive other reasonable duties and responsibilities
to be performed until the termination becomes effective.

10. Resolution of Disputes.

10.1. ARBITRATION. Any dispute, controversy or claim arising out of, involving,
affecting or related in any way to this Agreement or a breach of this Agreement,
or in any way arising out of, involving, affecting or related to Executive's
employment or the conditions of employment or the termination of employment, or
in any way arising out of, involving or affecting or related to any assignment
or termination of any assignment with any Client of Employer, including but not
limited to disputes, controversies or claims arising out of or related to the
actions of Employer's other employees, Employer's Clients and/or Client's
employees, under Federal, State and/or local laws, shall be resolved by final
and binding arbitration, in accordance with the applicable rules of JAMS in the
state where Executive is or was last employed by Employer. The arbitrator shall
be entitled to award reasonable attorney's fees and costs to the prevailing
party. The award shall be in writing, signed by the arbitrator, and shall
provide the reasons for the award. Judgment upon the arbitrator's award may be
filed in and enforced by any court having competent jurisdiction. This Agreement
to Arbitrate disputes does not prevent Executive from filing a charge or claim
with any governmental administrative agency as permitted by applicable law.
Notwithstanding the above, in the event that Executive commits a material breach
of this Agreement, or commits an intentional tort against Employer, it's agents,
employees, officers or directors, Employer may, without notice, elect to forgo
arbitration and may seek all equitable or contractual remedies available to it,
including prosecution for collection of all attorneys fees and costs occasioned
by the breach or tort.

                                     10.3-3
<PAGE>
10.2. SPECIFIC ENFORCEMENT. In addition to any monetary award, the arbitrator
may order a party to perform any act required by this Agreement or to refrain
from performing any act contrary to this Agreement. This Agreement to arbitrate
shall be specifically enforceable by any court of competent jurisdiction.

10.3. VENUE. The venue for arbitration proceeding will be San Diego County,
California.

10.4. COSTS AND EXPENSES. Initially, each party shall bear its own costs and
expenses in any arbitration proceedings; however, costs and reasonable
attorneys' fees shall be awarded to the prevailing party and paid by the
non-prevailing party.

11. General Provisions.

11.1. NOTICES. Notices between the parties shall be in writing and shall be
sufficient if delivered in any of the following methods:

A. personally delivered to the other party
B. sent by facsimile to the other party followed by a hard copy of the notice
sent as otherwise provided in this section
C. delivered by a major commercial delivery service (e.g., Federal Express, UPS)
D. mailed by certified or registered mail (return receipt requested) to the
party.

Each party's designated address is the address below that party's signature
block. If not received sooner, notices by mail shall be deemed received five (5)
days after deposit in the United States mail or delivery to the commercial
delivery service.

11.2. ASSIGNMENT. Neither party shall assign their rights and obligations under
this Agreement without the prior written consent of the other party.

11.3. ENTIRE AGREEMENT. This Agreement contains the entire understanding between
the parties relating to the rights granted and obligations assumed herein. This
Agreement supersedes all proposals, negotiations, conversations, or discussions
between the parties and all past dealing or industry custom. This Agreement
shall control if provisions of any subordinate documents conflict with this
Agreement.

11.4. BINDING ON SUCCESSORS. This Agreement shall bind and accrue to the benefit
of Executive's heirs, executors, administrators or assigns, and Employers
successors, assigns and licensees.

11.5. AMENDMENT AND WAIVER. The parties may amend any provision of this
Agreement or the observance of any provision may be waived or excused only with
the written consent of both parties. Either party's failure to enforce any
provisions of this Agreement shall not be construed as a waiver of that party's
right to enforce such provisions.

11.6. GOVERNING LAW. Regardless of the place of its physical execution, this
Agreement shall in all respects be interpreted, construed and governed by the
laws of the State of California. The venue for any action or proceeding
concerning, involving, or relating to this Agreement shall be San Diego County,
California.

                                     10.3-4
<PAGE>
11.7. SEVERABILITY. If any provision of this Agreement is held to be invalid,
illegal, or unenforceable by a court having valid jurisdiction, that provision
will be limited or eliminated to the minimum extent necessary so that this
Agreement shall otherwise remain enforceable.

11.8. FORCE MAJEURE. A party shall be temporarily excused from performing under
this Agreement if any force majeure or other occurrence beyond the reasonable
control of either party makes such performance impossible. The delayed party
shall resume performance of its obligations with due diligence after the
delaying event has subsided.

11.9. CONSTRUCTION. Headings and captions are for convenience only and not to be
used in the interpretation of this Agreement. Whenever the context requires,
words used in the singular shall be construed to include the plural and vice
versa, and pronouns of any gender shall be deemed to include the masculine,
feminine, or neuter gender. No provision of this Agreement shall be construed
against and interpreted to the disadvantage of any party because that party
drafted this Agreement.

11.10. COUNTERPART COPIES. This Agreement may be signed in counterpart copies,
each of which represents an original document, and all of which constitute a
single document.

The parties, through their authorized representatives, execute this Agreement as
of the date first written above.

EXECUTIVE:                          EMPLOYER:
---------                           --------

By:  /s/ Fred V. Lundberg           By:  /s/ Thomas L. Collins
   ---------------------------         --------------------------------------
         Fred V. Lundberg                    Thomas L. Collins
                                             Chief Executive Officer

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

                                    By:  /s/ Steve Racoosin
                                       --------------------------------------
                                             Steve Racoosin
                                             President and Founder

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

                                     10.3-5Exhibit 10.4
                                 LEASE AGREEMENT
                                 ---------------
1. Basic Provisions ("Basic Provisions").

         1.1 Parties: This Lease ("Lease"), dated for reference purposes only,
July 14th, 2004 is made by and between Taormina Industries, LLC, a Delaware
limited liability company ("Lessor") and World Waste of Anaheim, Inc. , a
California corporation ("Lessee'), (collectively the "Parties," or individually
a "Party").

         1.2 Premises: That certain real property, including all improvements
therein or to be provided by Lessor under the terms of this Lease, located at
2740 E. Coronado Street, Anaheim, located in the County of Orange, State of
California, and generally described as an approximately 30,000 SF industrial
building, more particularly described on Exhibit "A" attached hereto and
incorporated herein.

         1.3 Term: Ten (10) years ("Original Term") commencing July 26th, 2004
("Commencement Date") and ending July 25th, 2014, unless terminated sooner
pursuant to the terms of this Lease ("Expiration Date"). Notwithstanding
anything to the contrary set forth herein, this Lease shall automatically
terminate upon the expiration or termination of the "Recycle Agreement" (as
defined in the Addendum). (See also Paragraph 3).

         1.4 Intentionally Deleted.

         1.5 Base Rent: $15,900 per month ("Base Rent"), payable on the 1st day
of each month commencing July 26th, 2004. (See also Paragraph 4) Base Rent of
$3,077.42 for the period of July 26, 2004 - July 31, 2004, shall be due and
payable on July 26, 2004. |X| If this box is checked, there are provisions in
this Lease for the Base Rent to be adjusted.

         1.6 Base Rent and Other monies Paid Upon Execution:
             (a) Deposit: $63,600.00 Prepaid Rent, $31,800.00 Security Deposit
(collectively, the "Security Deposit"). (See also Paragraph 5 and Addendum)
             (b) Total Due Upon Execution of this Lease: $95,400.00

         1.7 Agreed Use:  Material  Processing,  in accordance  with the Recycle
Agreement" (See also Paragraph 6)

         1.8 Insuring Party: Lessor is the "Insuring Party". (See also Paragraph
8)

         1.9 Intentionally Deleted.

         1.10 Intentionally Deleted.

         1.11  Attachments:  Attached  hereto  are the  following,  all of which
constitute a part of this Lease.

         |X| Exhibit "A" - Plot plan depicting the Premises

         |X| Exhibit "B" - Recycle Agreement

                                     10.4-1

<PAGE>
2. Premises.

         2.1 Letting. Lessor hereby leases to Lessee, and Lessee hereby leases
from Lessor, the Premises, for the term, at the rental, and upon all of the
terms, covenants and conditions set forth in this Lease. Unless otherwise
provided herein, any statement of size set forth in this Lease, or that may have
been used in calculating Rent, is an approximation which the Parties agree is
reasonable and any payments based thereon are not subject to revision whether or
not the actual size is more or less. Note: Lessee is advised to verify the
actual size prior to executing this Lease.

         2.2 Condition. Lessor shall deliver the Premises to Lessee broom clean
and free of debris on the Commencement Date or the Early Possession Date,
whichever first occurs ("Start Date"). EXCEPT AS OTHERWISE EXPRESSLY SET FORTH
                                       ---------------------------------------
IN THIS LEASE, LESSEE AGREES THAT NEITHER LESSOR NOR ANY AGENT OF LESSOR HAS
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MADE ANY REPRESENTATION OR WARRANTY AS TO THE SUITABILITY OF THE PREMISES FOR
-----------------------------------------------------------------------------
LESSEE'S USE. LESSEE AGREES THAT NEITHER LESSOR NOR LESSOR'S AGENTS HAVE MADE
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ANY REPRESENTATIONS OR PROMISES WITH RESPECT TO THE PHYSICAL CONDITION OF THE
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PREMISES OR ANY OTHER MATTER OR THING AFFECTING OR RELATED TO THE PREMISES, AND
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NO RIGHTS, EASEMENTS OR LICENSES ARE ACQUIRED BY LESSEE BY IMPLICATION OR
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OTHERWISE. LESSEE HAS INSPECTED THE PREMISES AND IS THOROUGHLY ACQUAINTED WITH
------------------------------------------------------------------------------
THEIR CONDITION, AND EXCEPT AS OTHERWISE EXPRESSLY SET FORTH IN THIS LEASE,
---------------------------------------------------------------------------
AGREES TO TAKE THE SAME "AS IS", AND ACKNOWLEDGES THAT THE TAKING OF POSSESSION
-------------------------------------------------------------------------------
OF THE PREMISES BY LESSEE SHALL BE CONCLUSIVE EVIDENCE THAT THE PREMISES AND THE
--------------------------------------------------------------------------------
PREMISES WERE IN GOOD AND SATISFACTORY CONDITION AT THE TIME SUCH POSSESSION WAS
--------------------------------------------------------------------------------
SO TAKEN.
---------
         2.3 Acknowledgements. Lessee acknowledges that: (a) it has been advised
by Lessor to satisfy itself with respect to the condition of the Premises
(including but not limited to the electrical, HVAC and fire sprinkler systems,
security, environmental aspects, and compliance with Applicable Requirements and
the Americans with Disabilities Act, and their suitability for Lessee's intended
use, (b) Lessee has made such investigation as it deems necessary with reference
to such matters and assures all responsibility therefore as the same relate to
its occupancy of the Premises, and (c) neither Lessor nor Lessor's agents, have
made any oral or written representations or warranties with respect to said
matters, except as expressly set forth in this Lease.

3. Term.

         3.1 Term. The Commencement  Date,  Expiration Date and Original Term of
this Lease are as specified in Paragraph 1.3.

                                     10.4-2
<PAGE>
         3.2 Delivery of Premises. Lessor agrees to deliver possession of the
Premises to Lessee by the Commencement Date.

         3.3 Lessee Compliance. Lessor shall not be required to deliver
possession of the Premises to Lessee until Lessee complies with its obligation
to provide evidence of insurance (Paragraph 8.5). Pending delivery of such
evidence, Lessee shall be required to perform all of its obligations under this
Lease from and after the Start Date, including the payment of Rent,
notwithstanding Lessor's election to withhold possession pending receipt of such
evidence of insurance. Further, if Lessee is required to perform any other
conditions prior to or concurrent with the Start Date, the Start Date shall
occur but Lessor may elect to withhold possession until such conditions are
satisfied.

4. Rent.

         4.1 Rent Defined. All monetary obligations of Lessee to Lessor under
the terms of this Lease (except for the Security Deposit) are deemed to be rent
("Rent").

         4.2 Payment Lessee shall cause payment of Rent to be received by Lessor
in lawful money of the United States on or before the day on which it is due,
without offset or deduction . Rent for any period during the term hereof which
is for less than one full calendar month shall be prorated based upon the actual
number of days of said month. Payment of Rent shall be made to Lessor at its
address stated herein or to such other persons or place as Lessor may from time
to time designate in writing. Acceptance of a payment which is less than the
amount then due shall not be a waiver of Lessor's rights to the balance of such
Rent, regardless of Lessor's endorsement of any check so stating. In the event
that any check, draft, or other instrument of payment given by Lessee to Lessor
is dishonored for any reason, Lessee agrees to pay to Lessor the sum of $25 in
addition to any Late Charge and Lessor, at its option, may require all future
payments to be made by Lessee to be by cashier's check. Payments will be applied
first to accrued late charges and attorney's fees, second to accrued interest,
then to Base Rent and Operating Expense increase, and any remaining amount to
any other outstanding charges or costs.

5. Security Deposit. Lessee shall deposit with Lessor upon execution hereof the
Security Deposit as security for Lessee's faithful performance of its
obligations under this Lease. If Lessee fails to pay Rent, or otherwise Defaults
under this Lease, Lessor may use, apply or retain all or any portion of said
Security Deposit for the payment of any amount due Lessor or to reimburse or
compensate Lessor for any liability, expense, loss or damage which Lessor may
suffer or incur by reason thereof. If Lessor uses or applies all or any portion
of the Security Deposit, Lessee shall within 10 days after written request
therefor deposit monies with Lessor sufficient to restore said Security Deposit
to the full amount required by this Lease. If the Base Rent increases during the
term of this Lease, Lessee shall, upon written request from Lessor, deposit
additional moneys with Lessor so that the total amount of the Security Deposit
shall at all times bear the same proportion to the increased Base Rent as the
initial Security Deposit bore to the initial Base Rent. Should the Agreed Use be
amended to accommodate a material change in the business of Lessee or to
accommodate a Sublessee or assignee, Lessor shall have the right to increase the
Security Deposit to the extent reasonably necessary, in Lessor's reasonable
judgment, to account for any increased wear and tear that the Premises may

                                     10.4-3
<PAGE>
suffer as a result thereof. If a change in control of Lessee occurs during this
Lease and following such change the financial condition of Lessee is, in
Lessor's reasonable judgment, significantly reduced, Lessee shall deposit such
additional monies with Lessor as shall be sufficient to cause the Security
Deposit to be at a commercially reasonable level based on such change in
financial condition. Lessor shall not be required to keep the Security Deposit
separate from its general accounts. Within 14 days after the expiration or
termination of this Lease, if Lessor elects to apply the Security Deposit only
to unpaid Rent, and otherwise within 30 days after the Premises have been
vacated pursuant to Paragraph 7.4(c) below, Lessor shall return that portion of
the Security Deposit not used or applied by Lessor. No part of the Security
Deposit shall be considered to be held in trust, to bear interest or to be
prepayment for any monies to be paid by Lessee under this Lease.

6. Use; Hazardous Substances.

         6.1 Use. Lessee shall use and occupy the Premises only for the Agreed
Use, and for no other purpose. Lessee shall not use or permit the use of the
Premises in a manner that is unlawful, creates damage, waste or a nuisance, or
that disturbs occupants of or causes damage to neighboring premises or
properties. Lessor shall not unreasonably withhold or delay its consent to any
written request for a modification of the Agreed Use, so long as the same will
not impair the structural integrity of the Improvements on the Premises or the
mechanical or electrical systems therein, and/or is not significantly more
burdensome to the Premises. If Lessor elects to withhold consent, Lessor shall
within 7 days after such request give written notification of same, which notice
shall include an explanation of Lessor's objections to the change in the Agreed
Use.

         6.2 Hazardous Substances.
             (a) Reportable Uses Require Consent. The term "Hazardous Substance"
as used in this Lease shall mean any product, substance, or waste whose
presence, use, manufacture, disposal, transportation, or release, either by
itself or in combination with other materials expected to be on the Premises,is
either: (i) potentially injurious to the public health, safety or welfare, the
environment or the Premises, (ii) regulated or monitored by any governmental
authority, or (iii) a basis for potential liability of Lessor to any
governmental agency or third party under any applicable statute or common law
theory. Lessee shall not engage in any activity in or on the Premises which
constitutes a Reportable Use of Hazardous Substances without the express prior
written consent of Lessor and timely compliance (at Lessee's expense) with all
Applicable Requirements. "Reportable Use" shall mean (i) the installation or use
of any above or below ground storage tank, (ii) the generation, possession,
storage, use, transportation, or disposal of a Hazardous Substance that requires
a permit from, or with respect to which a report, notice, registration or
business plan is required to be filed with, any governmental authority, and/or
(iii) the presence at the Premises of a Hazardous Substance with respect to
which any Applicable Requirements require that a notice be given to persons
entering or occupying the Premises of a Hazardous Substance with respect to
which any Applicable Requirements requires that a notice be given to persons
entering or occupying the Premises or neighboring properties. Notwithstanding
the foregoing, Lessee may use or process any ordinary and customary materials
reasonably required to be used in the normal course of the Agreed Use, ordinary
office supplies (copier toner, liquid paper, glue, etc.) and common household
cleaning materials, so long as such use is in compliance with all Applicable

                                     10.4-4
<PAGE>
Requirements, is not a Reportable Use, and does not expose the Premises or
neighboring property to any meaningful risk of contamination or damage or expose
Lessor to any liability therefor. In addition, Lessor may condition its consent
to any Reportable Use upon receiving such additional assurances as Lessor
reasonably deems necessary to protect itself, the public, the Premises and/or
the environmental against damages, contamination, injury and/or liability,
including, but not limited to, the installation (and removal on or before Lease
expiration or termination of protective modifications (such as concrete
easements) and/or increasing the Security Deposit.
             (b) Duty to Inform Lessor. If Lessee knows, or has reasonable cause
to believe, that a Hazardous Substance has come to be located in, on, under or
about the Premises, other than as previously consented to by Lessor, Lessee
shall immediately give written notice of such fact to Lessor, and provide Lessor
with a copy of any report, notice, claim or other documentation which it has
concerning the presence of such Hazardous Substance.

             (c) Lessee Remediation. Lessee shall not cause or permit any
Hazardous Substance to be spilled or released in, on, under, or about the
Premises (including through the plumbing or sanitary sewer system) and shall
promptly, at Lessee's expense, comply with all Applicable Requirements and take
all investigatory and/or remedial action reasonably recommended, whether or not
formally ordered or required for the cleanup of any contamination of, and for
the maintenance, security and/or monitoring of the Premises or neighboring
properties, that was caused or materially contributed to by Lessee, or
pertaining to or involving any Hazardous Substance brought on to the Premises or
neighboring properties, that was caused or materially contributed to by Lessee,
or pertaining to or involving any Hazardous Substance brought on to the Premises
during the term of this Lease, by or for Lessee, or any third party.
             (d) Lessee Indemnification. Lessee shall indemnify, defend and hold
Lessor, its agents, employees, lenders and ground lessor, if any, harmless from
and against any and all rents and/or damages, liabilities, judgments, claims,
expenses, penalties, and attorneys' and consultants' fees arising directly out
of any Hazardous Substances brought onto the Premises by or for Lessee
(provided, however, that Lessee shall have no liability under this Lease with
respect to underground migration of any Hazardous Substance under the Premises
from adjacent properties not caused or contributed to by Lessee or from "escape"
and like of Hazardous Substances from a previous tenant of the Premises).
Lessee's obligations shall include, but not be limited to, the effects of any
contamination or injury to person, property or the environment created or
suffered by Lessee, and the cost of investigation, removal, remediation,
restoration and/or abatement, and shall survive the expiration or termination of
this Lease. No termination, cancellation or release agreement entered into by
Lessor and Lessee shall release Lessee from its obligations under this Lease
with respect to Hazardous Substances, unless specifically so agreed by Lessor in
writing at the time of such agreement.
             (e) Lessor Indemnification. Lessor shall indemnify, defend and hold
Lessee, its directors, agents, employees, lenders, if any, harmless from and
against any and all rents and/or damages, liabilities, judgments, claims,
expenses, penalties, and attorneys' and consultants' fees arising directly out
of any Hazardous Substances brought onto the Premises by or for Lessor or any
previous tenant of the Premises. Lessor's obligations shall include, but not be
limited to, the effects of any contamination or injury to person, property or
the environment created or suffered by Lessee, and the cost of investigation,
removal, remediation, restoration and/or abatement, and shall survive the
expiration or termination of this Lease. No termination, cancellation or release

                                     10.4-5
<PAGE>
agreement entered into by Lessee and Lessor shall release Lessor from its
obligations under this Lease with respect to Hazardous Substances, unless
specifically so agreed by Lessee in writing at the time of such Agreement.

         6.3 Lessee's Compliance with Applicable Requirements. Except as
otherwise provided in this Lease, Lessee shall, at Lessee's sole expense, fully,
diligently and in a timely manner, materially comply with all Applicable
Requirements, the requirements of any applicable fire insurance underwriter or
rating bureau, and the recommendations of Lessor's engineers and/or consultants
which relate in any manner to the such Requirements, without regard to whether
such Requirements are now in effect or become effective after the Start Date.
Lessee shall, within 10 days after receipt of Lessor's written request, provide
Lessor with copies of all permits and other documents, and other information
evidencing Lessee's compliance with any Applicable Requirements specified by
Lessor, and shall immediately upon receipt, notify Lessor in writing (with
copies of any documents involved) of any threatened or actual claim, notice,
citation, warning, complaint or report pertaining to or involving the failure of
Lessee or the Premises to comply with any Applicable Requirements.

         6.4 Inspection; Compliance. Lessor and Lessor's "Lender" (as defined in
Paragraph 30) and consultants shall have the right to enter into Premises at any
time, in the case of an emergency, and otherwise at reasonable times after
reasonable notice, for the purpose of inspecting the condition of the Premises
and for verifying compliance by Lessee with this Lease. The cost of any such
inspections shall be paid by Lessor, unless a material violation of Applicable
Requirements, or a Hazardous Substance Condition (see paragraph 9.1) is found to
exist or be imminent, or the inspection is requested or ordered by a
governmental authority. In the event Lessee is not in material compliance with
the terms of this Lease, Lessee shall upon request reimburse Lessor for the
reasonable cost of such inspection, so long as such inspection is directly
related to the violation or contamination. In addition, Lessee shall provide
copies of all relevant material safety data sheet (MSDS) to Lessor within 10
days of the receipt of a written request therefor.

7. Maintenance; Repairs; Utility Installations; Trade Fixtures and Alterations.

         7.1 Lessee's Obligations.
             (a) In General. Lessee shall, at Lessee's sole expense, keep the
Premises, Utility Installations (intended for Lessee's exclusive use, no matter
where located), and Alterations in good order, condition and repair (whether or
not the portion of the Premises requiring repairs, or the means of repairing the
same, are reasonably or readily accessible to Lessee, and whether or not the
need for such repairs occurs as a result of Lessee's use, any prior use, the
elements or the age of such portion of the Premises), including, but not limited
to, all equipment or facilities, such as plumbing, HVAC equipment, electrical,
lighting facilities, boilers, pressure vessels, fire protection system,
fixtures, walls (interior and exterior), ceilings, floors, windows, doors, plate
glass, skylights, landscaping, driveways, parking lots, fences, retaining walls,
signs, sidewalks and parkways located in or on the Premises. Lessee is also
responsible for keeping the roof and roof drainage clean and free of debris.
Lessee shall keep the surface and structural elements of the roof, foundations,
and bearing walls in good repair (see paragraph 7.2). Lessee, in keeping the
Premises in good order, condition and repair, shall exercise and perform good
maintenance practices, specifically including the procurement and maintenance of
the service contracts required by Paragraph 7.1(b) below. Lessee's obligations

                                     10.4-6
<PAGE>
shall include restorations, replacements or renewals when necessary to keep the
Premises and all improvements thereon or a part thereof in good order, condition
and state of repair. Lessee shall, during the term of this Lease, keep the
exterior appearance of the Building in a first-class condition consistent with
the exterior appearance of other similar facilities of comparable age and size
in the vicinity, including, when necessary, the exterior repainting of the
Building.
             (b) Service Contracts. Lessee shall, at Lessee's sole expense,
procure and maintain contracts, with copies to Lessor, in customary form and
substance for, and with contractors specializing and experienced in the
maintenance of the following equipment and improvements, if any, if and when
installed on the Premises: (i) HVAC equipment, (ii) boiler, and pressure
vessels, (iii) fire extinguishing systems, including fire alarm and/or smoke
detection, (iv) landscaping and irrigation systems, (v) clarifiers, (vi) basic
utility feed to the perimeter of the Building, and (viii) any other equipment,
if reasonably required by Lessor. However, Lessor reserves the right, upon
written notice to Lessee and the expiration of any cure period, to procure and
maintain any or all of such service contracts, and if Lessor so elects, Lessee
shall reimburse Lessor, upon demand, for the cost thereof.

             (c) Failure to Perform. If Lessee fails to perform Lessee's
obligations under this Paragraph 7.1. Lessor may enter upon the Premises after
any applicable notice and cure period (except in the case of an emergency, in
which case no notice shall be required), perform such obligations on Lessee's
behalf, and put the Premises in good order, condition and repair, and Lessee
shall promptly pay to Lessor a sum equal to 115% of the cost thereof.

         7.2 Lessor's Obligations. Subject to the provisions of Paragraphs 9
(Damage or Destruction) and 14 (Condemnation), it is intended by the Parties
hereto that Lessor have no obligation, in any manner whatsoever, to repair and
maintain the Premises, or the equipment therein, all of which obligations are
intended to be that of the Lessee. It is the intention of the Parties that the
terms of this Lease govern the respective obligations of the Parties as to
maintenance and repair of the Premises, and they expressly waive the benefit of
any statute now or hereafter in effect to the extent it is inconsistent with the
terms of this Lease.

         7.3 Utility Installations; Trade Fixtures; Alterations.
             (a) Definitions. The term "Utility Installations" refers to all
floor and window coverings, air and/or vacuum lines, power panels, electrical
distribution, security and fire protection systems, communication cabling,
lighting fixtures, HVAC equipment, plumbing, and fencing in or on the Premises.
The term "Trade Fixtures" shall mean Lessee's machinery and equipment that
Lessee brought onto and installed at the Premises for the operation of Lessee's
business. The term "Alterations" shall mean any modification of the
improvements, other than Utility Installations or Trade Fixtures, whether by
addition or deletion. "Lessee Owned Alterations and/or Utility Installations"
are defined as Alterations and/or Utility Installations made by Lessee that are
not yet owned by Lessor pursuant to Paragraph 7.4(a).
             (b) Consent. Lessee shall not make any Alterations or Utility
Installations to the Premises without Lessor's prior written consent. Lessee
may, however, make non-structural Alterations and Utility Installations to the
interior of the Premises (excluding the roof) without such consent but upon
notice to Lessor, as long as they are not visible from the outside, do not
involve purchasing, remodeling or removing the roof or any existing walls, and

                                     10.4-7
<PAGE>
will not adversely affect the electrical, plumbing, HVAC, and/or life safety
systems. Notwithstanding the foregoing, Lessee shall not make or permit any roof
penetrations and/or install anything on the roof without the prior written
approval of Lessor. Lessor may, as a pre condition to granting such approval,
require Lessee to utilize a contractor chosen and/or approved by Lessor. Any
Alterations or Utility Installations that Lessee shall desire to make and which
require the consent of the Lessor shall be presented to Lessor in written form
with detailed plans. Consent shall be deemed conditioned upon Lessee's: (i)
acquiring all applicable governmental permits, (ii) furnishing Lessor with
copies of both the permits and the plans and specifications prior to
commencement of the work, and (iii) compliance with all conditions of said
permits and other Applicable Requirements in a prompt and expeditious manner.
Any Alterations or Utility Installations shall be performed in a workmanlike
manner with good and sufficient materials. Lessee shall promptly upon completion
furnish Lessor with as-built plans and specifications.
             (c) Liens; Bonds. Lessee shall pay, when due, all claims for labor
or materials furnishing or alleged to have been furnished to or for Lessee at or
for use on the Premises, which claims are or may be secured by any mechanic's or
materialmen's lien against the Premises or any interest therein. Lessee shall
give Lessor not less than 10 days notice prior to the commencement of any work
in, on or about the Premises, and Lessor shall have the right to post notices of
non-responsibility. If Lessee shall contest the validity of any such lien, claim
or demand, then Lessee shall, at its sole expense defend and protect itself,
Lessor and the Premises against the same and shall pay and satisfy any such
adverse judgment that may be rendered thereon before the enforcement thereof. If
Lessor shall require, Lessee shall furnish a surety bond in an amount equal to
150% of the amount of such contested lien, claim or demand, indemnifying Lessor
against liability for the same. If Lessor elects to participate in any such
action, Lessee shall pay Lessor's attorneys' fees and costs.

         7.4 Ownership; Removal; Surrender; and Restoration.
             (a) Ownership. Subject to Lessor's right to require removal or
elect ownership as hereinafter provided, all Alterations and Utility
Installations made by Lessee shall be the property of Lessee, but considered a
part of the Premises. Lessor may, at any time, elect in writing to be the owner
of all or any specified part of the Lessee Owned Alterations and Utility
Installations. Unless otherwise instructed per paragraph 7.4(b) hereof, all
Lessee Owned Alterations and Utility Installations shall, at the expiration or
termination of this Lease, become the property of Lessor and be surrendered by
Lessee with the Premises.
             (b) Removal. By delivery to Lessee of written notice from Lessor
not earlier than 90 and not later than 30 days prior to the end of the term of
this Lease, Lessor may require that any or all Lessee Owned Alterations or
Utility Installations be removed by the expiration or termination of this Lease.
Lessor may require the removal at any time of all or any part of any Lessee
Owned Alterations or Utility Installations made without the required consents.
             (c) Surrender; Restoration. Lessee shall surrender the Premises by
the Expiration Date or any earlier termination date, with all of the
improvements, parts and surfaces thereof broom clean and free of debris, and in
good operating order, condition and state of repair, ordinary wear and tear and
preconditions excepted. "Ordinary wear and tear" shall not include any damage or
deterioration that would have been prevented by good maintenance practice.
Lessee shall repair any damage occasioned by the installation, maintenance or
removal of Trade Fixtures, Lessee owned Alterations and/or Utility
Installations, furnishings, and equipment as well as the removal of any storage

                                     10.4-8
<PAGE>
tank installed by or for Lessee. Lessee shall completely remove from the
Premises any and all Hazardous Substances brought onto the Premises by or for
Lessee, or any third party (except Hazardous Substances which were deposited via
underground migration from areas outside of the Premises, or if applicable, the
Project) even if such removal would require Lessee to perform or pay for work
that exceeds statutory requirements. Trade Fixtures shall remain the property of
Lessee and shall be removed by Lessee. Lessee shall repair any damage caused by
such removal, at its expense. Any personal property of Lessee not removed on or
before the Expiration Date or any earlier termination date shall be deemed to
have been abandoned by Lessee and may be disposed of or retained by Lessor as
Lessor may desire. The failure by Lessee to timely vacate the Premises pursuant
to this Paragraph 7.4(c) without the express written consent of Lessor shall
constitute a holdover under the provisions of Paragraph 26 below.

8. Insurance; Indemnity.

         8.1 Liability Insurance. Lessee shall obtain and keep in force a
commercial General Liability policy of insurance protecting Lessee and Lessor as
an additional insured against claims for bodily injury, personal injury and
property damage based upon or arising out of the ownership, use, occupancy or
maintenance of the Premises and all goods appurtenant thereto. Such insurance
shall be on an occurrence basis providing single limit coverage in an amount not
less than $1,000,000 per occurrence with an annual aggregate of not less than
$2,000,000, an "Additional Insured-Managers or Lessors of Premises Endorsement"
and contain the "Amendment of the Pollution Exclusion Endorsement" for damage
caused by heat, smoke or fumes from a hostile fire. The policy shall not contain
any intra-insured exclusions as between insured persons or organizations, but
shall include coverage for liability assumed under this Lease as an "Insured
contract" for the performance of Lessee's indemnity obligation under this Lease.
The limits of said insurance shall not, however, limit the liability of Lessee
nor relieve Lessee of any obligation hereunder. All insurance carried by Lessee
shall be primary to and not contributory with any similar insurance carried by
Lessor, whose insurance shall be considered excess insurance only.

         8.2 Property Insurance - Building, Improvements and Rental Value.
             (a) Building and Improvements The Insuring Party shall obtain and
keep in force a policy or policies in the name of Lessor, with loss payable to
Lessor, any ground-lessor, and to any Lender insuring loss or damage to the
Premises. The amount of such insurance shall be equal to the full replacement
cost of the Premises, as the same shall exist from time to time, or the amount
required by any Lender, but in no event more than the commercially reasonable
and available insurable value thereof. If Lessor is the Insuring Party, however,
Lessee Owned Alterations and Utility Installations, Trade Fixtures, and Lessee's
personal property shall be insured by Lessee under Paragraph 8.4 rather than by
Lessor. If the coverage is available and commercially appropriate, such policy
or policies shall insure against all risks of direct physical loss or damage
(except the perils of flood and/or earthquake unless required by a lender or
included in the Base Premium), including coverage for debris removal and the
enforcement of any Applicable Requirements requiring the upgrading, demolition,
reconstruction or replacement of any portion of the Premises as the result of a
covered loss. Said policy or policies shall also contain an agreed valuation
provision in lieu of any coinsurance clause, waiver of subrogation, and
inflation guard protection causing an increase in the annual property insurance
coverage amount by a factor of not less than the adjusted U.S. Department of

                                    10.4-9
<PAGE>
Labor Consumer Price Index for All Urban Consumers for the city nearest to where
the Premises are located. If such insurance coverage has a deductible clause,
the deductible amount shall not exceed $1,000 per occurrence, and Lessee shall
be liable for such deductible amount in the event of an Insured Loss.
             (b) Rental Value. Lessee shall obtain and keep in force a policy or
policies in the name of Lessor with loss payable to Lessor and any Lender,
insuring the loss of the full Rent for one year with an extended period of
indemnity for an additional 180 days ("Rental Value Insurance"). Said insurance
shall contain an agreed valuation provision in lieu of any coinsurance clause,
and the amount of coverage shall be adjusted annually to reflect the projected
Rent otherwise payable by Lessee, for the next 12 month period. Lessee shall be
liable for any deductible amount in the event of such loss.

             (c) Adjacent Premises. If the Premises are part of a larger
building or of a group of buildings owned by Lessor which are adjacent to the
Premises, the Lessee shall pay for any increase in the premiums for the property
insurance of such building or buildings if said increase is caused by Lessee's
acts, omissions, use or occupancy of the Premises.

         8.3 Lessee's Property; Business Interruption Insurance
             (a) Property Damage. Lessee shall obtain and maintain insurance
coverage on all of Lessee's personal property, Trade Fixtures, and Lessee Owned
Alterations and Utility Installations. Such insurance shall be full replacement
cost coverage with a deductible of not to exceed $1,000 per occurrence. The
proceeds from any such insurance shall be used by Lessee for the replacement of
personal property, Trade Fixtures and Lessee Owned Alterations and Utility
Installations. Lessee shall provide Lessor with written evidence that such
insurance is in force.
             (b) Business Interruption. Lessee shall obtain and maintain loss of
income and extra expense insurance in amounts as will reimburse Lessee for
direct or indirect loss of earnings attributable to all perils commonly insured
against by prudent lessees in the business of Lessee or attributable to
prevention of access to the Premises as a result of such perils.
             (c) No Representation of Adequate Coverage. Lessor makes no
representation that the limits or forms of coverage of insurance specified
herein are adequate to cover Lessee's property, business operations or
obligations under this Lease.

         8.4 Insurance Policies. Insurance required herein shall be by companies
duly licensed or admitted to transact business in the state where the Premises
are located, and maintaining during the policy term a "General Policyholders
Rating" of at least B+. V. as set forth in the most current issue of "Best's
Insurance Guide", or such other rating as may be required by a Lender. Lessee
shall not do or permit to be done anything which invalidates the required
insurance policies. Lessee shall, prior to the Start Date, deliver to Lessor
certified copies of policies of such insurance or certificates evidencing the
existence and amounts of the required insurance. No such policy shall be
cancelable or subject to modification except after 30 days prior written notice
to Lessor. Lessee shall, at least 30 days prior to the expiration of such
policies, furnish Lessor with evidence of renewals or "insurance binders"
evidencing renewal thereof, or Lessor may order such insurance and charge the
cost thereof to Lessee, which amount shall be payable by Lessee to Lessor upon
demand. Such policies shall be for a term of at least one year or the length of
the remaining term of this Lease, whichever is less. If either Party shall fail
to procure and maintain the insurance required to be carried by it, the other
Party may, but shall not be required to, procure and maintain the same.

                                    10.4-10
<PAGE>
         8.5 Waiver of Subrogation Without affecting any other rights or
remedies, Lessee and Lessor each hereby release and relieve the other, and waive
their entire right to recover damages against the other, for loss of or damage
to its property arising out of or incident to the perils required to be insured
against herein. The effect of such releases and waivers is not limited by the
amount of insurance carried or required, or by any deductibles applicable
hereto. The Parties agree to have their respective property damage insurance
carriers waive any right to subrogation that such companies may have against
Lessor or Lessee, as the case may be, so long as the insurance is not
invalidated thereby.

         8.6 Indemnity. Except for Lessor's gross negligence of willful
misconduct, Lessee shall indemnify, protect, defend and hold harmless the
Premises, Lessor and its agents, Lessor's master or ground lessor, partners and
Lenders, from and against any and all claims, loss of rents and/or damages,
liens, judgments, penalties, attorneys' and consultants' fees, expenses and/or
liabilities arising out of, involving, or in connection with, the use and/or
occupancy of the Premises by Lessee. If any action or proceeding is brought
against Lessor by reason of any of the foregoing matters, Lessee shall upon
notice defend the same at Lessee's expense by counsel reasonably satisfactory to
Lessor and Lessor shall cooperate with Lessee in such defense. Lessor need not
have first paid any such claim in order to be defended or indemnified. Except
for Lessee's gross negligence of willful misconduct, Lessor shall indemnify,
protect, defend and hold harmless the Lessee from and against any and all
claims, loss of rents and/or damages, liens, judgments, penalties, attorneys'
and consultants' fees, expenses and/or liabilities arising out of, involving, or
in connection with, the gross negligence or willful misconduct of Lessor. If any
action or proceeding is brought against Lessee by reason of any of the foregoing
matters, Lessor shall upon notice defend the same at Lessor's expense by counsel
reasonably satisfactory to Lessee and Lessee shall cooperate with Lessor in such
defense. Lessee need not have first paid any such claim in order to be defended
or indemnified.

         8.7 Exemption of Lessor from Liability. Except in the event of Lessor's
negligence, misconduct, or breach of this Lease, Lessor shall not be liable for
injury or damage to the person or goods, wares, merchandise or other property of
Lessee, Lessee's employees, contractors, invitees, customers, or any other
person in or about the Premises, whether such damage or injury is caused by or
results from fire, steam, electricity, gas, water or rain, or from the breakage,
leakage, obstruction or other defects of pipes, fire sprinklers, wires,
appliances, plumbing, HVAC or lighting fixtures, or from any other cause,
whether the said injury or damage results from conditions arising upon the
Premises or upon other portions of the building of which the Premises are a
part, or from other sources or places. Lessor shall not be liable for any
damages arising from any act or neglect of any other tenant of Lessor nor from
the failure of Lessor to enforce the provisions of any other lease in the
Project. Except in the event of Lessor's negligence, misconduct or breach of
this Lease, Lessor shall under no circumstances be liable for injury to Lessee's
business or for any loss or income or profit therefrom.

9. Damages or Destruction.
         9.1 Definitions.
             (a) "Premises Partial Damage" shall mean damage or destruction to
the improvements on the Premises, other than Lessee Owned Alterations and
Utility Installations, which can reasonably be repaired in 6 months or less from

                                    10.4-11
<PAGE>
the date of the damage or destruction. Lessor shall notify Lessee in writing
within 30 days from the date of the damage or destruction as to whether or not
the damage is Partial or Total.
             (b) "Premises Total Destruction" shall mean damage or destruction
to the Premises, other than Lessee Owned Alterations and Utility Installations
and Trade Fixtures, which cannot reasonably be repaired in 6 months or less from
the date of the damage or destruction. Lessor shall notify Lessee in writing
within 30 days from the date of the damage or destruction as to whether or not
the damage is Partial or Total.
             (c) "Insured Loss" shall mean damage or destruction to improvements
on the Premises, other than Lessee Owned Alterations and Utility Installations
and Trade Fixtures, which was caused by an event required to be covered by the
insurance described in Paragraph 8.3(a), irrespective of any deductible amounts
or coverage limits involved.
             (d) "Replacement Cost" shall mean the cost to repair or rebuild the
improvements owned by Lessor at the time of the occurrence to their condition
existing immediately prior thereto, including demolition debris removal and
upgrading required by the operation of Applicable Requirements, and without
deduction for depreciation.
             (e) Hazardous Substance Conditions" shall mean the occurrence or
discovery of a condition involving the presence of, or a contamination by, a
Hazardous Substance as defined in Paragraph 6.2(a) in, on, or under the Premises
which requires repair, remediation, or restoration.

         9.2 Partial Damage - Insured Loss. If a Premises Partial Damage that is
an Insured Loss occurs, then Lessor shall, at Lessor's expense, repair such
damage (but not Lessee's Trade Fixture, or Lessee Owned Alterations and Utility
Installations) as soon as reasonably possible and this Lease shall continue in
full force and effect; provided, however, that Lessee shall, at Lessor's
election, make the repair of any damage or destruction the total cost to repair
of which is $15,000 or less, and, in such event, Lessor shall make any
applicable insurance proceeds available to Lessee on a reasonable basis for that
purpose. Notwithstanding the foregoing, if the required insurance was not in
force or the insurance proceeds are not sufficient to effect such repair, the
Insuring Party shall promptly contribute the shortage in proceeds (except as to
the deductible which is Lessee's responsibility) as and when required to
complete said repairs. In the event, however, such shortage was due to the fact
that, by reason of the unique nature of the improvements, full replacement cost
insurance coverage was not commercially reasonable and available, Lessor shall
have no obligation to pay for the shortage in insurance proceeds or to fully
restore the unique aspects of the Premises unless Lessee provides Lessor with
the funds to cover same, or adequate assurance thereof, within 30 days following
receipt of written notice of such shortage and request therefor. If Lessor
received said funds or adequate assurance thereof within said 30 day period, the
party responsible for making the repairs shall complete them as soon as
reasonably possible and this Lease shall remain in full force and effect. If
such funds or assurance are not received, Lessor may nevertheless elect by
written notice to Lessee within 10 days thereafter to: (i) make such restoration
and repair as is commercially reasonable with Lessor paying any shortage in
proceeds, in which case this Lease shall remain in full force and effect, or
(ii) have this Lease terminate 30 days thereafter. Lessee shall not be entitled
to reimbursement of any funds contributed by Lessee to repair any such damage or
destruction. Premises Partial Damage due to flood or earthquake shall be subject
to Paragraph 9.3, notwithstanding that there may be some insurance coverage, but
the net proceeds of any insurance shall be made available for the repairs if
made by either Party.

                                    10.4-12
<PAGE>
         9.3 Partial Damage - Uninsured Loss. If a Premises Partial Damage that
is not an Insured Loss occurs, unless caused by a negligent or willful act of
Lessee (in which event Lessee shall make the repairs at Lessee's expense),
Lessor may either: (i) repair such damage as soon as reasonably possible at
Lessor's expense, in which event this Lease shall continue in full force and
effect, or (ii) terminate this Lease by giving written notice to Lessee within
30 days after receipt by Lessor of knowledge of the occurrence of such damage.
Such termination shall be effective 60 days following the date of such notice.
In the event Lessor elects to terminate this Lease, Lessee shall have the right
within 10 days after receipt of the termination notice to give written notice to
Lessor of Lessee's commitment to pay for the repair of such damage without
reimbursement from Lessor. Lessee shall provide Lessor with said funds or
satisfactory assurance thereof within 30 days after making such commitment. In
such event this Lease shall continue in full force and effect, and Lessor shall
proceed to make such repairs as soon as reasonably possible after the required
funds are available. If Lessee does not make the required commitment, this Lease
shall terminate as of the date specified in the termination notice.

         9.4 Total Destruction. Notwithstanding any other provision hereof, if a
Premises Total Destruction occurs, this Lease shall terminate 30 days following
such Destruction. If the damage or destruction was caused by the gross
negligence or willful misconduct of Lessee, Lessor shall have the right to
recover Lessor's damages from Lessee, except as provided in Paragraph 8.5. If
the damage or destruction was caused by the gross negligence or willful
misconduct of Lessor, Lessee shall have the right to recover Lessee's damages
from Lessor, except as provided in Paragraph 8.5.

         9.5 Damage Near End of Term. If at any time during the last 6 months of
this Lease there is damage for which the cost to repair exceeds one month's Base
Rent, whether or not an Insured Loss, Lessor may terminate this Lease effective
60 days following the date of occurrence of such damage by giving a written
termination notice to Lessee within 30 days after the date of occurrence of such
damage. Notwithstanding the foregoing, if Lessee at that time has an exercisable
option to extend this Lease or to purchase the Premises, the Lessee may preserve
this lease by, (a) exercising such option and (b) providing Lessor with any
shortage in insurance proceeds (or adequate assurance thereof) needed to make
the repairs on or before the earlier of (i) the date which is 10 days after
Lessee's receipt of Lessor's written notice purporting to terminate this Lease,
or (ii) the day prior to the date upon which such option expires. If Lessee duly
exercises such option during such period and provides Lessor with funds (or
adequate assurance thereof) to cover any shortage in insurance proceeds, Lessor
shall, at Lessor's commercially reasonable expense, repair such damage as soon
as reasonably possible and this Lease shall continue in full force and effect.
If Lessee fails to exercise such option and provide such funds or assurance
during such period, then this Lease shall terminate on the date specified in the
termination notice and Lessee's option shall be extinguished.

         9.6 Abatement of Rent; Lessee's Remedies.
             (a) Abatement. In the event of Premises Partial Damage or Premises
Total Destruction or a Hazardous Substance Condition for which Lessee is not
responsible under this Lease, the Rent payable by Lessee for the period required
for the repair, remediation or restoration of such damage shall be abated in
proportion to the degree to which Lessee's use of the Premises is impaired, but
not to exceed the proceeds received from the Rental Value Insurance. All other

                                    10.4-13
<PAGE>
obligations of Lessee hereunder shall be performed by Lessee, and Lessor shall
have no liability for any such damage, destruction, remediation, repair or
restoration except as provided herein.
             (b) Remedies. If Lessor shall be obligated to repair or restore the
Premises and does not commence, in a substantial and meaningful way, such repair
or restoration within 90 days after such obligation shall accrue or if Lessor
does not complete such work within 180 days from date of damage, Lessee may, at
any time prior to the commencement of such repair or restoration (if
applicable), give written notice to Lessor and to any Lenders of which Lessee
has actual notice, of Lessee's election to terminate this Lease on a date not
less than 60 days following the giving of such notice. If Lessee gives such
notice and such repair or restoration is not commenced within 30 days
thereafter, this Lease shall terminate as of the date specified in said notice.
If the repair or restoration is commenced within such 30 days, this Lease shall
continue in full force and effect. "Commence" shall mean either the
unconditional authorization of the preparation of the required plans, or the
beginning of the actual work on the Premises, whichever first occurs.

         9.7 Termination; Advance Payments. Upon termination of this Lease
pursuant to Paragraph 6.2(g) or Paragraph 9, an equitable adjustment shall be
made concerning advance Base rent and any other advance payments made by Lessee
to Lessor. Lessor shall, in addition, return to Lessee so much of Lessee's
Security Deposit as has not been, or is not then required to be, used by Lessor.

         9.8 Waive Statutes. Lessor and Lessee agree that the terms of this
Lease shall govern the effect of any damage to or destruction of the Premises
with respect to the termination of this Lease and hereby waive the provisions of
any present or future statute to the extent inconsistent herewith.

10. Real Property Taxes.
         10.1 Definition. As used herein, the term "Real Property Taxes" shall
include any form of assessment, real estate, general, special, ordinary or
extraordinary, or rental levy or tax (other than inheritance, personal income or
estate taxes); improvement bond; and/or license fee imposed by or levied against
any legal or equitable interest of Lessor in the Premises or the Project,
Lessor's right to other income therefrom, and/or Lessor's business of leasing,
by any authority having the direct or indirect power to tax and where the funds
are generated with reference to the Building address and where the proceeds so
generated are to be applied by the city, county or other local taxing authority
of a jurisdiction within which the Premises are located. Real Property Taxes
shall also include any tax, fee, levy, assessment or charge, or any increase
therein: (i) imposed by reason of events occurring during the term of this
Lease, including but not limited to, a change in the ownership of the Premises,
and (ii) levied or assessed on machinery or equipment provided by Lessor to
Lessee pursuant to this Lease.

         10.2 Taxes.
              (a) Payment of Taxes. Lessor shall pay the Real Property Taxes
applicable to the Premises.
              (b) Additional Improvements. Notwithstanding anything to the
contrary in this Paragraph 10.2. Lessee shall pay to Lessor upon demand therefor
the entirety of any increase in real Property Taxes assessed by reason of
Alterations on Utility Installations placed upon the Premises by Lessee or at
Lessee's request.

                                    10.4-14
<PAGE>
         10.3 Joint Assessment. If the Premises are not separately assessed,
Lessee's liability shall be an equitable proportion of the Tax Increase for all
of the land and improvements included within the tax parcel assessed, such
proportion to be conclusively determined by Lessor from the respective
valuations assigned in the assessor's work sheets or such other information as
may be reasonably available.

         10.4 Personal Property Taxes. Lessee shall pay, prior to delinquency,
all taxes assessed against and levied upon Lessee Owned Alterations, Utility
Installations, Trade Fixtures, furnishings, equipment and all personal property
of Lessee. When possible, Lessee shall cause its Lessee Owned Alterations and
Utility Installations, Trade Fixtures, furnishings, equipment and all other
personal property to be assessed and billed separately from the real property of
Lessor. If any of Lessee's said property shall be assessed with Lessor's real
property, Lessee shall pay Lessor the taxes attributable to Lessee's property
within 10 days after receipt of a written statement setting forth the taxes
applicable to Lessee's property.

11. Utilities and Services. Lessee shall pay for all water, gas, heat, light,
power, telephone, trash disposal and other utilities and services supplied to
the Premises, together with any taxes thereon. If any such services are not
separately metered or billed to Lessee, Lessee shall pay a proportion to be
reasonably determined by Lessor, of all charges jointly metered or billed. There
shall be no abatement of rent and Lessor shall not be liable in any respect
whatsoever for the inadequacy, stoppage, interruption or discontinuance of any
utility or service due to riot, strike, labor dispute, breakdown, accident,
repair or other cause beyond Lessor's reasonable control or in cooperation with
governmental request or directions.

12. Assignment and Subletting.
         12.1 Lessor's Consent Required.
              (a) Lessee shall not voluntarily or by operation of law assign,
transfer, mortgage or encumber (collectively, "assign or assignment") or sublet
all or any part of Lessee's interest in this Lease or in the Premises without
Lessor's prior written consent, which consent shall not be unreasonably
withheld.
              (b) Unless Lessee is a corporation and its stock is publicly
traded on a national stock exchange, a "change in the control" of Lessee shall
constitute an assignment requiring consent. A "change in control" shall mean and
shall be deemed to have taken place if: (i) any individual, entity or group
(within the meaning of Sections 13(d)(3) or 14(d)(2) of the Securities Exchange
Act of 1934 (the "Exchange Act") becomes the beneficial owner of shares of
Lessee and/or Lessee's ultimate parent having 50% or more of the total number of
votes that may be cast for the election of directors of Lessee and/or Lessee's
ultimate parent (or 20% in the event such individual, entity or group is engaged
in the solid waste collection, transfer and/or disposal business in competition
with Lessor or Lessor's parent or subsidiaries), other than as a result of any
acquisition through a bona fide sale of shares of Lessee and/or Lessee's
ultimate parent to the public, or (ii) a change in the composition of the Board
of Directors of Lessee and/or Lessee's ultimate parent (the "Board") such that
the individuals who, as of the date of this Lease, constitute the Board (the
Board as of such date shall be hereafter referred to as the "Incumbent Board")
cease for any reason to constitute at least a majority of the Board; provided
however, for purposes of this Paragraph, that any individual who becomes a
member of the Board subsequent to the date hereof whose election, nomination for

                                    10.4-15
<PAGE>
election by Lessee's or Lessee's ultimate parent's shareholders, was approved by
a vote of at least a majority of those individuals who are members of the Board
and who were also members of the Incumbent Board (or deemed to be pursuant to
this proviso) shall be considered as though such individual was a member of the
Incumbent Board; but provided further, that any such individual whose initial
assumption of office occurs as a result of either an actual or threatened
election contest (as such terms are used in Rule 14a-11 of Regulation 14A
promulgated under the Exchange Act) or other actual or threatened solicitation
of proxies or consents by or on behalf of a person other than the Board shall
not be so considered as a member of the Incumbent Board.
              (c) The involvement of Lessee or its assets in any transaction, or
series of transactions (by way of merge, sale, acquisition, financing, transfer,
leveraged buy-out or otherwise), whether or not a formal assignment or
hypothecation of this Lease or Lessee's assets occurs, which results or will
result in a reduction of the Net Worth of Lessee by an amount greater than 25%
of such Net Worth as it was represented at the time of the execution of this
Lease or at the time of the most recent assignment to which Lessor has
consented, or as it exists immediately prior to said transaction or transactions
constituting such reduction, whichever was or is greater, shall be considered an
assignment of this Lease to which Lessor may withhold its consent. "Net Worth of
Lessee" shall mean the net worth of Lessee (excluding any guarantors)
established under generally accepted accounting principles.
              (d) An assignment or subletting without consent shall, at Lessor's
option, be a Default curable after notice per Paragraph 13.1(c), or a noncurable
Breach without the necessity of any notice and grace period. If Lessor elects to
treat such nonapproved assignment or subletting as a noncurable Breach, Lessor
may either: (i) terminate this Lease, or (ii) upon 30 days written notice,
increase the monthly Base rent to 110% of the Base Rent then in effect. Further,
in the event of such Breach and rental adjustment all fixed and non-fixed rental
adjustments scheduled during the remainder of the Lease term shall be increased
to 110% of the scheduled adjusted rent.

         12.2 Terms and Conditions Applicable to Assignment and Subletting.
              (a) Regardless of Lessor's consent, no assignment or subletting
shall: (i) be effective without the express written assumption by such assignee
of the obligations of Lessee under this Lease or without such Sublessee
acknowledging that its sublease is subject to this Lease (ii) release Lessee of
any obligations hereunder, or (iii) alter the primary liability of Lessee for
the payment of Rent or for the performance of any other obligations to be
performed by Lessee.
              (b) Lessor may accept Rent or performance of Lessee's obligations
from any person other than Lessee pending approval or disapproval of an
assignment. Neither a delay in the approval or disapproval of such assignment
nor the acceptance of Rent or performance shall constitute a waiver or estoppel
of Lessor's right to exercise its remedies for assessed Default or Breach.
              (c) Lessor's consent to any assignment or subletting shall not
constitute a consent to any subsequent assignment or subletting.
              (d) In the event of any Default or Breach by Lessee, Lessor may
proceed directly against Lessee or anyone else responsible for the performance
of Lessee's obligations under this Lease, including any assignee or Sublessee,
without first exhausting Lessor' remedies against any other person or entity
responsible therefor to Lessor, or any security held by Lessor.
              (e) Each request for consent to an assignment or subletting shall
be in writing, accompanied by information relevant to Lessor's determination as
to the financial and operational responsibility and appropriateness of the

                                    10.4-16
<PAGE>
proposed assignee or Sublessee, including but not limited to the determination
as to the financial and operational responsibility and appropriateness of the
proposed assignee or Sublessee, including but not limited to the intended use
and/or required modification of the Premises, if any, together with a fee of
$500 as consideration for Lessor's considering and processing said request.
Lessee agrees to provide Lessor with such other or additional information and/or
documentation as may be reasonably requested. (See also Paragraph 36).
              (f) Any assignee of, or Sublessee under, this Lease shall, by
reason of accepting such assignment or entering into such sublease, be deemed to
have assumed (or been made subject to) and agreed to conform and comply with
each and every term, covenant, condition and obligation herein to be observed or
performed by Lessee during the term of said assignment or sublease, other than
such obligations as are contrary to or inconsistent with provisions of an
assignment or sublease to which Lessor has specifically consented in writing.
              (g) Lessor's consent to any assignment or subletting shall not
transfer to the assignee or Sublessee any Option granted to the original Lessee
by this Lease unless such transfer is specifically consented to by Lessor in
writing. (See Paragraph 39.2).

         12.3 Additional Terms and Conditions Applicable to Subletting.  The
following terms and conditions shall apply to any subletting by Lessee of all or
any part of the Premises and shall be deemed included in all subleases under
this Lease whether or not expressly incorporated therein;
              (a) Lessee hereby assigns and transfers to Lessor all of Lessee's
interest in all Rent payable on any sublease, and Lessor may collect such Rent
and apply same toward Lessee's obligations under this Lease; provided, however,
that until a Breach shall occur in the performance of Lessee's obligations,
Lessee may collect said Rent. In the event that the amount collected by Lessor
exceeds Lessee's obligations any such excess shall be refunded to Lessee. Lessor
shall not, by reason of the foregoing or any assignment of such sublease, nor by
reason of the collection of Rent, be deemed liable to the Sublessee for any
failure of Lessee to perform and comply with any Lessee's obligations to such
Sublessee. Lessee hereby irrevocably authorized and directs any such Sublessee,
upon receipt of a written notice from Lessor stating that a Breach exists in the
performance of Lessee's obligations under this Lease, to pay to Lessor all Rent
due and to become due under the sublease. Sublessee shall rely upon any such
notice from Lessor and shall pay all Rents to Lessor without any obligation or
right to inquire as to whether such Breach exists, notwithstanding any claim
from Lessee to the contrary.
              (b) In the event of a Breach by Lessee, Lessor may, at its option,
require Sublessee to attorn to Lessor, in which event Lessor shall undertake the
obligations of the Sublessor under such sublease from the time of the exercise
of said option to the expiration of such sublease; provided, however, Lessor
shall not be liable for any prepaid rents or security deposit paid by such
Sublessee to such Sublessor or for any prior Defaults or Breaches of such
Sublessor.
              (c) Any matter requiring the consent of the Sublessor under a
sublease shall also require the consent of Lessor, if Lessor's consent for such
matter would be required hereunder.
              (d) No Sublessee shall further assign or sublet all or any part of
the Premises without Lessor's prior written consent.
              (e) Lessor shall deliver a copy of any notice of Default or Breach
by Lessee to the Sublessee, who shall have the right to cure the Default of
Lessee within the Grace period, if any, specified in such notice. The Sublessee
shall have a right of reimbursement and offset from and against Lessee for any
such Defaults cured by the Sublessee.

                                    10.4-17
<PAGE>
13. Default; Breach; Remedies.

         13.1 Default; Breach. A "Default" is defined as a failure by the Lessee
to comply with or perform any of the terms, covenants, or conditions under this
Lease, as well as a failure by the Lessee to comply with or perform any of the
terms, covenants, obligations or conditions under the "Recycle Agreement" (as
defined in Exhibit "B" attached hereto and incorporated herein). A breach is
defined as the occurrence of one or more of the following Defaults, and the
failure of Lessee to cure such Default within any applicable grace period
(provided, however, that Lessor shall not be required to provide more than three
(3) written notices of Default and a cure period in any twelve (12) month period
during the Term or more than one (1) written notice of Default and a cure period
in the event such Default may adversely affect Lessor's permits and approvals):
              (a) The abandonment of the Premises; or the vacating of the
Premises.
              (b) The failure of Lessee to make any payment of Rent or any
Security Deposit required to be made by Lessee hereunder, whether to Lessor or
to a third party, when due, to provide reasonable evidence of insurance or
surety bond, where such failure continues for a period of 30 days following
written notice to Lessee, or to fulfill any obligation under this Lease or the
Recycle Agreement which endangers or threatens life or property, where such
failure continues for a period of 3 business days following written notice to
Lessee.
              (c) The failure by Lessee to provide (i) reasonable written
evidence of compliance with Applicable Requirements, (ii) the service contracts,
(iii) the rescission of an unauthorized assignment or subletting, (iv) an
Estoppel Certificate, (v) a requested subordination, (vi) any document requested
under Paragraph 42, (vii) material safety data sheets (MSDS), or (viii) any
other documentation or information which Lessor may reasonably require of Lessee
under the terms of this Lease, where any such failure continues for a period of
10 days following written notice to Lessee.
              (d) A Default by Lessee as to the terms, covenants, conditions or
provisions of this Lease, other than those described in subparagraphs 13.1(a),
(b) or (c) above, where such Default continues for a period of 30 days after
written notice (except in the event any such Default may adversely affect
Lessor's permits or approvals for its operations, in which event the period
shall be five (5) days or such shorter period of time set forth in any notice of
violation from a governmental entity).
              (e) The occurrence of any of the following events: (i) the making
of any general arrangement or assignment for the benefit of creditors; (ii)
becoming a "debtor" as defined in 11 U.S.C. ss.101 or any successor statute
thereto (unless, in the case of a petition filed against Lessee, the same is
dismissed within 60 days); (iii) the appointment of a trustee or receiver to
take possession of substantially all of Lessee's assets located at the Premises
or of Lessee's interest in this Lease, where possession is not restored to
Lessee within 30 days; or (iv) the attachment, execution or other judicial
seizure of substantially all of Lessee's assets located at the Premises or of
Lessee's interest in this Lease, where such seizure is not discharged within 30
days; provided, however, in the event that any provision of this subparagraph
(e) is contrary to any applicable law, such provision shall be of no force or
effect, and not affect the validity of the remaining provisions.
              (f) The discovery that any financial statement of Lessee given to
Lessor was materially false.
              (g) A Default by Lessee as to the terms, covenants, conditions or
provisions of the Recycle Agreement, where such Default continues beyond any
applicable notice and cure period.

                                    10.4-18
<PAGE>
         13.2 Remedies. If Lessee fails to perform any of its affirmative duties
or obligations, within any notice and cure period provided herein (or in case of
an emergency, without notice), Lessor may, at its option, perform such duty or
obligation on Lessee's behalf, including but not limited to the obtaining of
reasonably required bonds, Insurance policies, or governmental licenses, permit
or approvals. Lessee shall pay to Lessor an amount equal to 115% of the costs
and expenses incurred by Lessor in such performance upon receipt of an invoice
therefore. In the event of a Breach, Lessor may, with or without further notice
or demand, except as otherwise required by this Paragraph, and without limiting
Lessor in the exercise of any right or remedy which Lessor may have by reason of
such Breach:
              (a) Terminate Lessee's right to possession of the Premises by any
lawful means, in which case this Lease shall terminate and Lessee shall
immediately surrender possession to Lessor. In such event Lessor shall be
entitled to recover from Lessee: (i) the unpaid Rent which had been earned at
the time of termination; (ii) the worth at the time of award of the amount by
which the unpaid rent which would have been earned after termination until the
time of award exceeds the amount of such rental loss that the Lessee proves
could have been reasonably avoided; (iii) the worth at the time of award of the
amount by which the unpaid rent for the balance of the term after the time of
award exceeds the amount of such rental loss that the Lessee proves could be
reasonably avoided; and (iv) any other amount necessary to compensate Lessor for
all the detriment proximately caused by the Lessee'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 the cost of recovering
possession of the Premises, expenses of reletting, including necessary
renovation and alteration of the Premises, reasonable attorneys' fees, and that
portion of any leasing commission paid by Lessor in connection with this Lease
applicable to the unexpired term of this Lease. The worth at the time of award
of the amount referred to in provision (iii) of the immediately preceding
sentence shall be computed by discounting such amount at the discount rate of
the Federal Reserve Bank of the District within which the Premises are located
at the time of award plus one percent. Efforts by Lessor to mitigate damages
caused by Lessee's Breach of this Lease shall not waive Lessor's right to
recover damages under Paragraph 12. If termination of this Lease is obtained
through the provisional remedy of unlawful detainer, Lessor shall have the right
to recover in such proceeding any unpaid Rent and damages as are recoverable
therein, or Lessor may reserve the right to recover all or any part thereof in a
separate suit. If a notice and grace period required under Paragraph 13.2 was
not previously given a notice to pay rent or quit, or to perform or quit given
to Lessee under the unlawful detainer statute shall also constitute the notice
required by Paragraph 13.1. In such case, the applicable grace period required
by Paragraph 13.1 and the unlawful detainer statute shall run concurrently, and
the failure of Lessee to cure the Default within the greater of the two such
grace periods shall constitute both an unlawful detainer and a Breach of this
Lease entitling Lessor to the remedies provided for in this Lease and/or by said
statute.
              (b) Continue the Lease and Lessee's right to possession and
recover the Rent as it becomes due, in which event Lessee may sublet or assign,
subject only to reasonable limitations. Act of maintenance, efforts to relet,
and/or the appointment of a receiver to protect the Lessor's interests, shall
not constitute a termination of the Lessee's right to possession.
              (c) Pursue any other remedy now or hereafter available under the
laws or judicial decisions of the state wherein the Premises are located,
including any rights available to Lessor under California Civil Code section
1954.2. The expiration or termination of this Lease and/or the termination of

                                    10.4-19
<PAGE>
Lessee's right to possession shall not relieve the Lessee from liability under
any indemnity provisions of this Lease as to matters occurring or accruing
during the Term hereof or by reason of Lessee's occupancy of the Premises.

         13.3 Intentionally Deleted.

         13.4 Late Charges. Lessee hereby acknowledges that late payment by
Lessee of Rent will cause Lessor to incur costs not contemplated by this Lease,
the exact amount of which will be extremely difficult to ascertain. Such costs
may include, but are not limited to, processing and accounting charges, and late
charges which may be imposed upon Lessor by any Lender. Accordingly, if any Rent
shall not be received by Lessor within 10 days after such amount shall be due,
then, without any requirement for notice to Lessee, Lessee shall immediately pay
to Lessor a one-time late charge equal to 5% of each such overdue amount or
$100, whichever is greater. The Parties hereby agree that such late charge
represents a fair and reasonable estimate of the costs Lessor will incur by
reason of such late payment. Acceptance of such late charge by Lessor shall in
no event constitute a waiver of Lessee's Default or Breach with respect to such
overdue amount, nor prevent the exercise of any of the other rights and remedies
granted hereunder. In the event that a late charge is payable hereunder, whether
or not collected, for 3 consecutive installments of Base Rent, then
notwithstanding any provision of this Lease to the contrary, Base Rent shall, at
Lessor's option, become due and payable quarterly in advance.

         13.5 Interest. Any monetary payment due Lessor hereunder, other than
late charges, not received by Lessor, when due as to scheduled payments (such as
Base Rent) or within 30 days following the date on which it was due for
non-scheduled payment, shall bear interest from the date when due, as to
scheduled payments, or the 31st day after it was due as to non-scheduled
payments. The interest ("Interest") charged shall be computed at the rate of 10%
per annum but shall not exceed the maximum rate allowed by law.
Interest is payable in addition to the potential late charge provided for in
Paragraph 13.4

14. Condemnation. If the Premises or any portion thereof are taken under the
power of eminent domain or sold under the threat of the exercise of said power
(collectively "Condemnation"), this Lease shall terminate as to the part taken
as of the date the condemning authority takes title or possession, whichever
first occurs. If more than 10% of the Building, or more than 25% of that portion
of the Premises not occupied by any building, is taken by Condemnation, Lessee
may, at Lessee's option, to be exercised in writing within 10 days after Lessor
shall have given Lessee written notice of such taking (or in the absence of such
notice, within 10 days after the condemning authority shall have taken
possession) terminates this Lease as of the date the condemning authority takes
such possession. If Lessee does not terminate this Lease in accordance with the
foregoing, this Lease shall remain in full force and effect as to the portion of
the Premises remaining, except that the Base Rent shall be reduced in proportion
to the reduction in utility of the Premises caused by such Condemnation.
Condemnation awards and/or payments shall be the property of Lessor, whether
such award shall be made as compensation for diminution in value of the
leasehold, the value of the part taken, or for severance damages; provided,
however, that Lessee shall be entitled to any compensation for Lessee's
relocation expenses, loss of business goodwill and/or Trade Fixtures, without
regard to whether or not this Lease is terminated pursuant to the provisions of
this Paragraph. All Alterations and Utility Installations made to the Premises
by Lessee, for purposes of Condemnation only, shall be considered the property

                                    10.4-20
<PAGE>
of the Lessee and Lessee shall be entitled to any and all compensation which is
payable therefore. In the event that this Lease is not terminated by reason of
the Condemnation, Lessor shall repair any damage to the Premises caused by such
Condemnation.

15. Brokerage Fees. Lessee and Lessor each represent and warrant to the other
that it has had no dealings with any person, firm, broker of finder in
connection with this Lease, and that no one is entitled to any commission or
finder's fee in connection herewith. Lessee and Lessor do each hereby agree to
indemnify, protect, defend and hold the other harmless from and against
liability for compensation or charges which may be claimed by any such unnamed
broker, finder or other similar party by reason of any dealings or actions of
the Indemnifying Party, including any costs, expenses, attorneys' fees
reasonably incurred with respect thereto.

16. Estoppel Certificates.
              (a) Lessee (as "Responding Party") shall within 10 days after
written notice from the Lessor (the "Requesting Party") execute, acknowledge and
deliver to the Requesting Party a statement in writing in form similar to the
then most current "Estoppel Certificate" form published by the American
Industrial Real Estate Association, plus such additional information,
confirmation and/or statements as may be reasonably requested by the Requesting
Party.
              (b) If the Responding Party shall fail to execute or deliver the
Estoppel Certificate within such 10 day period, the Requesting Party may execute
an Estoppel Certificate stating that: (i) the Lease is in full force and effect
without modification except as may be represented by the Requesting Party, (ii)
there are no uncured defaults in the Requesting Party's performance and (iii) if
Lessor is the Requesting Party, not more than one month's rent has been paid in
advance. Prospective purchasers and encumbrancers may rely upon the Requesting
Party's Estoppel Certificate, and the Responding Party shall be stopped from
denying the truth of the facts contained in said Certificate.
              (c) If Lessor desire to finance, refinance, or sell the Premises,
or any part thereof, Lessee shall deliver to any potential lender or purchaser
designated by Lessor such financial statements as may be reasonably required by
such lender or purchaser, including but not limited to Lessee's financial
statements for the past 3 years. All such financial statements shall be received
by Lessor and such lender or purchaser and shall be used only for the purposes
herein set forth, and shall be kept confidential at all times.

17. Definition of Lessor. The term "Lessor" as used herein shall mean the owner
or owners at the time in question of the fee title to the Premises. In the event
of a transfer of Lessor's title or interest in the Premises or this Lease,
Lessor shall deliver to the transferee or assignee (in cash or by credit) any
unused Security Deposit held by Lessor. Except as provided in Paragraph 15, upon
such transfer or assignment and delivery of the Security Deposit, as aforesaid,
the prior Lessor shall be relieved of all liability with respect to the
obligations and/or covenants under this Lease thereafter to be performed by the
Lessor. Subject to the foregoing, the obligations and/or covenants in this Lease
to be performed by the Lessor shall be binding only upon the Lessor as
hereinabove defined.

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

                                    10.4-21
<PAGE>
19. Days. Unless otherwise specifically indicated to the contrary, the word
"days" as used in this Lease shall mean and refer to calendar days.

20. Limitation on Liability. The obligations of Lessor under this Lease shall
not constitute personal obligations of Lessor or its partners, members,
directors, officers or shareholders, and Lessee shall look to the Premises, and
to no other assets of Lessor, for the satisfaction of any liability of Lessor
with respect to this Lease, and shall not seek recourse against Lessor's
partners, members, directors, officers or shareholders, or any of their personal
assets for such satisfaction.

21. Time of Essence. Time is of the essence with respect to the performance of
all obligations to be performed or observed by the Parties under this Lease.

22. No Prior or Other Agreements; Broker Disclaimer. This Lease and the "Recycle
Agreement" (hereinafter defined) is the entire agreement between the Parties
with respect to any matter mentioned herein, and no other prior or
contemporaneous agreement of understanding shall be effective.

23. Notices.
         23.1 Notice Requirements. All notices required or permitted by this
Lease or applicable law shall be in writing and may be delivered in person (by
hand or by courier) or may be sent by regular, certified or registered mail or
U.S. Postal Service Express Mail, with postage prepaid, and shall be deemed
sufficiently given if served in a manner specified in this Paragraph 23. The
addresses noted adjacent to a Party's signature on this Lease shall be that
Party's address for delivery or mailing of notice. Either Party may by written
notice to the other specify a different address for notice, except that upon
Lessee's taking possession of the Premises, the Premises shall constitute
Lessee's address for notice. A copy of all notices to Lessor shall be
concurrently transmitted to such party or parties at such addresses as Lessor
may from time to time hereafter designate in writing.
         23.2 Date of Notice. Any notice sent by registered or certified mail,
return receipt requested, shall be deemed given on the date of delivery shown on
the receipt card, or if no delivery date is shown, the postmark thereon. If sent
by regular mail the notice shall be deemed given 48 hours after the same is
addressed as required herein and mailed with postage prepaid. Notices delivered
by United States Express Mail or overnight courier that guarantees next day
delivery shall be deemed given 24 hours after delivery of the same to the Postal
Service or courier. If notice is received on a Saturday, Sunday or legal
holiday, it shall be deemed received on the next business day.

24. Waivers. No waiver by Lessor of the Default or Breach of any term, covenant
or condition hereof by Lessee, shall be deemed a waiver of any other term,
covenant or condition hereof, or of any subsequent Default or Breach by Lessee
of the same or of any other term, covenant or condition hereof. Lessor's consent
to, or approval of, any act shall not be deemed to render unnecessary the
obtaining of Lessor's consent to, or approval of, any subsequent or similar act
by Lessee, or be construed as the basis of any estoppel to enforce the provision
or provisions of this Lease requiring such consent. The acceptance of Rent by
Lessor shall not be a waiver of any Default or Breach by Lessee. Any payment by
Lessee may be accepted by Lessor on account of moneys or damages due Lessor,
notwithstanding any qualifying statements or conditions made by Lessor at or
before the time of deposit of such payment, and/or conditions shall be of no
force or effect whatsoever unless specifically agreed to in writing by Lessor at
or before the time of deposit of such payment.

                                    10.4-22
<PAGE>
25. Intentionally Deleted.

26. No Right To Holdover. Lessee has no right to retain possession of the
Premises or any part thereof beyond the expiration or termination of this Lease.
In the event that Lessee holds over, then the Base Rent shall be increased to
150% of the Base Rent applicable immediately preceding the expiration or
termination. Nothing contained herein shall be construed as consent by Lessor to
any holding over by Lessee.

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

28. Covenants and Conditions; Construction of Agreement. All provisions of this
Lease to be observed or performed by Lessee are both covenants and conditions.
In construing this Lease, all headings and titles are for the convenience of the
Parties only and shall not be considered a part of this Lease. Whenever required
by the context, the singular shall include the plural and vice versa. This Lease
shall not be construed as if prepared by one of the Parties, but rather
according to its fair meaning as a whole, as if both Parties had prepared it.

29. Binding Effect; Choice of Law. This Lease shall be binding upon the Parties,
their personal representatives, successors and assigns and be governed by the
laws of the State in which the Premises are located. Any litigation between the
Parties hereto concerning this Lease shall be initiated in the county in which
the Premises are located.

30. Subordination; Attornment; Non-Disturbance.

         30.1 Subordination. This Lease and any Option granted hereby shall be
subject and subordinate to any ground lease, mortgage, deed of trust, or other
hypothecation or security device (collectively, "Security Devices"), now or
hereinafter placed upon the Premises, to any and all advances made on the
security hereof, and to all renewals, modifications, and extensions thereof.
Lessee agrees that the holders of any such Security Devices (in this Lease
together referred to as "Lender") shall have no liability or obligation to
perform any of the obligations of Lessor under this Lease. Any Lender may elect
to have this Lease and/or any Option granted hereby superior to the lien of its
Security Device by giving written notice thereof to Lessee, whereupon this Lease
and such Options shall be deemed prior to such Security Device, notwithstanding
the relative dates of the documentation or recordation thereof.

         30.2 Attornment. In the event that Lessor transfer title to the
Premises, or the Premises are acquired by another upon the foreclosure or
termination of a Security Device to which this Lease is subordinated (i) Lessee
shall attorn to the term hereof, or, at the election of such new owner, this
Lease shall automatically become a new Lease between Lessee and such new owner,
upon all of the terms and conditions hereof, for the remainder of the term
hereof, and (ii) Lessor shall thereafter be relieved of any further obligations
hereunder and such new owner shall assume all of Lessor's obligations hereunder,
except that such new owner shall not (a) be liable for any act or omission of
any prior lessor or with respect to events occurring prior to acquisition of
ownership; (b) be subject to any offsets or defenses which Lessee might have
against any prior lessor, (c) be bound by prepayment of more than one month's
rent or (d) be liable for the return of any security deposit paid to any prior
lessor.

                                    10.4-23
<PAGE>
         30.3 Self-Executing. The agreements contained in this Paragraph 30
shall be effective without the execution of any further documents; provided,
however, that upon written request from Lessor or a Lender in connection with a
sale, financing or refinancing of the Premises, Lessee and Lessor shall execute
such further writings as may be reasonably required to separately document any
subordination, attornment and/or Non-Disturbance Agreement provided for herein.

         30.4 Request for Nondisturbance Agreement. With respect to each
Security Device that may encumber the Premises at or after the commencement of
the Term, Lessor agrees that following its receipt of a written request by
Lessee, Landlord will ask the holder of the Security Device to grant to Lessee a
"nondisturbance agreement" in the usual form of such holder. The term
"nondisturbance agreement" as used herein shall mean, in general, an agreement
that as long as Lessee is not in default under this Lease, this Lease will not
be terminated if such holder acquires title to the Premises by reason of
foreclosure proceedings or acceptance of a deed in lieu of foreclosure, provided
that Lessee attorns to the holder in accordance with its requirements. Except
for making such request, Landlord will be under no duty or obligation hereunder,
nor will the failure or refusal of such holder to grant a nondisturbance
agreement render Lessor liable to Lessee, or affect this Lease, in any manner.
Lessee shall bear all costs and expenses, including reasonable attorneys' fees
and costs, of such holder in connection with a nondisturbance agreement.

31. Attorney's Fees. If any Party brings an action or proceeding involving the
Premises whether founded in tort, contract or equity, or to declare rights
hereunder, the Prevailing Party (as hereafter defined) in any such proceeding,
action, or appeal thereon, shall be entitled to reasonable attorneys' fees. Such
fees may be awarded in the same suit or recovered in a separate suit, whether or
not such action or proceeding is pursued to decision or judgment. The term
"Prevailing Party" shall include, without limitation, a Party who substantially
obtains or defeats the relief sought, as the case may be, whether by compromise,
settlement, judgment, or the abandonment by the other Party of its claim or
defense. The attorneys' fees award shall not be computed in accordance with any
court fee schedule, but shall be such as to fully reimburse all attorneys' fees
reasonably incurred. In addition, Lessor shall be entitled to attorneys' fees,
costs and expenses incurred in the preparation and service of notices of Default
and consultations in connection therewith, whether or not a legal action is
subsequently commenced in connection with such Default or resulting Breach ($200
is a reasonable minimum per occurrence for such services and consultation).

32. Lessor's Access; Showing Premises; Repairs. Lessor and Lessor's agents shall
have the right to enter the Premises, at any time in the case of an emergency,
and otherwise at reasonable times after reasonable prior notice, for the purpose
of showing the same to prospective purchasers, lenders, or tenants, and making
such alterations, repairs, improvements or additions to the Premises as Lessor
may deem necessary or desirable and the erecting, using and maintaining of
utilities, services, pipes and conduits through the Premises and/or other
premises so long as there is no material adverse effect to Lessee's use of the
Premises. All such activities shall be without abatement of rent or liability to
Lessee.

33. Auctions. Lessee shall not conduct, nor permit to be conducted, any auction
upon the Premises without Lessor's prior written consent. Lessor shall not be
obligated to exercise any standard of reasonableness in determining whether to
permit an auction.

                                    10.4-24
<PAGE>
34. Signs. Lessor may place on the Premises ordinary "For Sale" signs at any
time and ordinary "For Lease" signs during the last 6 months of the term hereof.
Lessee shall not place any sign upon the Premises without Lessor's prior written
consent. All signs must comply with all Applicable Requirements.

35. Termination; Merger. Unless specifically stated in writing by Lessor, the
voluntary or other surrender of this Lease by Lessee, the mutual termination or
cancellation hereof, or a termination hereof by Lessor for Breach by Lessee,
shall automatically terminate any sublease or lesser estate in the Premises;
provided, however, that Lessor may elect to continue any one or all existing
subtenancies. Lessor's failure within 10 days following any such event to elect
to the contrary by written notice to the holder of any such lesser interest,
shall constitute Lessor's election to have such event constitute the termination
of such interest.

36. Consents. Except as otherwise provided herein, whenever in this Lease the
consent of a Party is required to an act by or for the other Party, such consent
shall not be unreasonably withheld or delayed. Lessor's actual reasonable costs
and expenses (including but not limited to architects', attorneys', engineers'
and other consultants' fees) incurred in the consideration of, or response to, a
request by Lessee for any Lessor consent, including but not limited to consents
to an assignment, a subletting or the presence or use of a Hazardous Substance,
shall be paid by Lessee upon receipt of an invoice and supporting documentation
therefore. Lessor's consent to any act, assignment or subletting shall not
constitute an acknowledgment that no Default or Breach by Lessee of this Lease
exists, nor shall such consent be deemed a waiver of any then existing Default
or Breach, except as may be otherwise specifically stated in writing by Lessor
at the time of such consent. The failure to specify herein any particular
condition to Lessor's consent shall not preclude the imposition by Lessor at the
time of consent of such further contract conditions as are then reasonable with
reference to the particular matter for which consent is being given.

37. Intentionally Deleted.

38. Quiet Possession. Subject to payment by Lessee of the Rent and performance
of all of the covenants, conditions and provisions on Lessee's part to be
observed and performed under this Lease, Lessee shall have quiet possession and
quiet enjoyment of the Premises during the term hereof.

39. Options. If Lessee is granted an Option, as defined below, then the
following provisions shall apply:

         39.1 Definition.  "Option" shall mean:  the right to extend the term of
this Lease.

         39.2 Options Personal To Original Lessee. Any Option granted to Lessee
in this Lease is personal to the original Lessee, and cannot be assigned or
exercised by anyone other than said original Lessee and only while the original
Lessee is in full possession of the Premises and, if requested by Lessor, with
Lessee certifying that Lessee has no intention of thereafter assigning or
subletting.

         39.3 Multiple Options. In the event that Lessee has any multiple
Options to extend or renew this Lease, a later Option cannot be exercised unless
the prior Options have been validly exercised.

                                    10.4-25
<PAGE>
         39.4 Effect of Default on Options.
              (a) Lessee shall have no right to exercise an Option: (i)during
the period commencing with the giving of any notice of Default and continuing
until said Default is cured, (ii) during the period of time any Rent is unpaid
(without regard to whether notice thereof is given Lessee), (iii) during the
time Lessee is in Breach of this Lease, or (iv) in the event that Lessee has
been given 3 or more notices of separate Default, whether or not the Defaults
are cured, during the 12 month period immediately preceding the exercise of the
Option.
              (b) The period of time within which an Option may be exercised
shall not be extended or enlarged by reason of Lessee's inability to exercise an
Option because of the provisions of Paragraph 39.4(a).
              (c) An Option shall terminate and be of no further force or
effect, notwithstanding Lessee's due and timely exercise of the Option, if,
after such exercise and prior to the commencement of the extent or term or
completion of the purchase, (i) Lessee fails to pay Rent for a period of 30 days
after such Rent becomes due (without any necessity of Lessor to give notice
thereof, or (ii) if Lessee commits a Breach of this Lease.

40. Multiple Buildings. If the Premises are a part of a group of buildings
controlled by Lessor, Lessee agrees that it will abide by and conform to all
reasonable rules and regulations which Lessor may make from time to time to the
management, safety, and care of said properties, including the care and
cleanliness of the grounds and including the parking, loading and unloading of
vehicles, and to cause its employees, suppliers, shippers, customers,
contractors and invitees to so abide and conform. Lessee also agrees to pay its
fair share of common expenses incurred in connection with such rules and
regulations.

41. Security Measures. Lessee hereby acknowledges that the Rent payable to
Lessor hereunder does not include the cost of guard service or other security
measures, and that Lessor shall have no obligation whatsoever to provide same.
Lessee assumes all responsibility for the protection of the Premises, Lessee,
its agents and invitees and their property from the acts of third parties.

42. Reservations. Lessor reserves to itself the right from time to time, to
grant, without the consent or joinder of Lessee, such easements, rights and
dedications that Lessor deems necessary, and to cause their recordation of
parcel maps and restrictions, so long as such easements, rights, dedications,
maps and restrictions do not unreasonably interfere with the use of the Premises
by Lessee. Lessee agrees to sign any documents reasonably requested by Lessor to
effectuate any such easement rights, dedication, map or restrictions.

43. Force Majeure. In the event that either party hereto shall be delayed,
hindered or prevented from the performance required hereunder (other than the
payment of Rent) by reason of any "Force Majeure" (hereinafter defined) event,
such party shall be excused for the period of time equivalent to the delay
caused by such event. "Force Majeure" shall mean any event or condition having a
material and adverse effect on the rights, duties and obligations of either
party hereunder, or on the Premises, the design, construction, equipping,
start-up, operation, ownership or possession of any or all of them, if such
event or condition is beyond the reasonable control, and not the result of
willful or negligent action or omission or a lack of reasonable diligence, of
the party asserting the Force Majeure; provided that the contesting in good
faith of any event or condition constituting a change in law shall not

                                    10.4-26
<PAGE>
constitute or be construed as a willful or negligent action or a lack of
reasonable diligence of such party. The foregoing provisions shall not be
construed to require that either party observe a higher standard of conduct than
required by the usual and customary standards of the industry in question, as a
condition to claiming the existence of a Force Majeure. Such events or
conditions constituting a Force Majeure event may include, but shall not be
limited to, circumstances of the following kind: an act of God, epidemic,
landslide, lightning, hurricane, earthquake, fire, explosion, storm, flood or
similar occurrence, an act of war, terrorism, effects of nuclear radiation,
blockade, insurrection, riot, civil disturbance or similar occurrences, strikes,
lockouts, work slowdowns or stoppages, or similar labor difficulties affecting
either party hereunder, or the operation of the leased Premises, or otherwise
affecting or impacting the performances of either party's contractors and
suppliers; or a change in law, including, without limitation, a change in
California Law AB 939 which modifies or affects Lessor's obligations with
respect to recycling or disposal of recyclable materials.

44. Authority; Multiple Parties; Execution.
              (a) If either party hereto is a corporation, trust, limited
liability company, partnership, or similar entity, each individual executing
this Lease on behalf of such entity represents and warrants that he or she is
fully authorized to execute and deliver this Lease on its behalf. Each party
shall, within 30 days after request, deliver to the other party satisfactory
evidence of such authority.
              (b) If this Lease is executed by more than one person or entity as
"Lessee", each such person or entity shall be jointly and severally liable
hereunder. It is agreed that any one of the named Lessees shall be empowered to
execute any amendment to this Lease, or other document ancillary thereto and
bind all of the named Lessees, and Lessor may rely on the same as if all of the
named Lessees had executed such document.
              (c) This Lease may be executed by the Parties in counterparts,
each of which shall be deemed an original and all of which together shall
constitute one and the same instrument. A facsimile copy of any signature hereto
shall be deemed an original.

45. Conflict. Any conflict between the printed provisions of this Lease and
typewritten or handwritten provisions shall be controlled by the typewritten or
handwritten provisions.

46. Other. Preparation of this Lease by either Party or their agent and
submission of same to the other Party shall not be deemed an offer to lease to
the other Party. This Lease is not intended to be binding until executed and
delivered by all Parties hereto.

47. Amendments. This Lease may be modified only in writing, signed by the
Parties in interest at the time of the modification. As long as they do not
materially change Lessee's obligations hereunder, Lessee agrees to make such
reasonable non-monetary modifications to this Lease as may be reasonably
required by a Lender in connection with the obtaining of normal financing or
refinancing of the Premises.

48. Waiver of Jury Trial. THE PARTIES HEREBY WAIVE THEIR RESPECTIVE RIGHTS TO
TRIAL BY JURY IN ANY ACTION OR PROCEEDING INVOLVING THE PROPERTY OR ARISING OUT
OF THIS AGREEMENT.

                                    10.4-27
<PAGE>
49. Mediation and Arbitration of Disputes. An Addendum requiring the Mediation
and/or the Arbitration of all disputes between the Parties and/or Brokers
arising out of this Lease is not attached to this Lease.

50. Americans with Disabilities Act. Lessor makes no warranty or representation
as to whether or not the Premises comply with ADA or any similar legislation. In
the event that Lessee's use of the Premises requires modifications or additions
to the Premises in order to be in ADA compliance, Lessee agrees to make any such
necessary modifications and/or additions at Lessee's expense.

51. Security Deposit. Upon execution of this Lease, Lessee shall pay Lessor
prepaid rent equal to four (4) months Base Rent ($63,600.00) ("Prepaid Rent")
and a security deposit equal to two (2) months Base Rent ($31,800.00) ("Security
Deposit"). Except as otherwise set forth herein, eighteen (18) months following
the date of this Lease, and upon the mutual agreement of both parties, the
Prepaid Rent ($63,600.00) will be returned to the Lessee in one lump sum, and
the Security Deposit ($31,800.00) shall be retained by Lessor.

52. Rent Increases. Base Rent shall be adjusted annually on a calendar year
basis, effective January 1, 2006 (the "Adjustment Date"), by the product of the
monthly Base Rent for the month prior to the Adjustment Date, multiplied by a
fraction, the numerator of which shall be the Consumer Price Index ("CPI") for
the month of the Adjustment Date, and the denominator shall be the CPI published
for the corresponding month of the year prior to the Adjustment Date (provided
that the denominator for the first adjustment shall be the CPI published for the
month and year of the date of this Lease). For purposes of this Paragraph, the
term CPI shall mean the "Los Angeles-Anaheim-Riverside CPI Index, All Urban
Consumer", as published by the Bureau of Labor Statistics of the United States
Department of Labor ("BLS") or any successor agency. In the event that the index
for the most recent comparison month is not available as of any Adjustment Date,
monthly Base Rent payments shall continue at the rate in effect immediately
preceding the Adjustment Date until the index for such comparison month is
available. On the monthly Base Rent payment date which follows the date that the
index for such comparison month is available, monthly Base Rent shall be
adjusted retroactively to the Adjustment Date, and any accrued monthly Base Rent
shall be immediately due and payable. It is expressly agreed that the Base Rent
shall not be lower than the amount set forth in Paragraph 1.5 of this Lease.

53. Extension Options. The Term of this agreement may be extended for three (3)
additional periods of five (5) years each, upon the mutual written agreement of
both parties, for a total potential Term of twenty-five (25) years.
Notwithstanding the foregoing, Lessor shall have the unilateral right to extend
the Original Term for the first (1st) five (5) year extension period, upon
written notice to Lessee prior to the expiration of the Original Term.

54. Hazardous Materials. Lessor represents and warrants, to its knowledge and
without investigation, that the Premises are free of Hazardous Substances.
Lessee shall not dump, discharge, allow to leak, evaporate or otherwise escape
onto the premises any noxious, poisonous or otherwise hazardous materials,
chemicals and/or gases. Lessee agrees to be strictly liable for all liability,
damage, costs (including reasonable attorneys' fees and costs) and expenses of
remediation, clean up, fines, compliance costs and/or any other damages related
to Lessee's use or storage of any hazardous materials on the Premises. Lessee
shall not be liable under this Lease in the event the escape of Hazardous
Substances are caused by Lessor.

                                   10.4-28
<PAGE>
55. Clarification. It is understood by both Lessor and Lessee that the following
has been discussed and is agreed to by both parties:
              A. Exhibit "A" notes the main entrance to the Disposal and
Recycling Plant. Lessor acknowledges that there will be approximately 1,000 -
2,000 disposal trucks and public vehicles per day passing by the Premises.
              B. Lessee shall not in any way obstruct Lessor's vehicles or
public vehicles from passing by or through the Premises.
              C. Lessee shall not park vehicles in any space, except for the
parking spaces specifically designated for Lessee parking only, as noted on
Exhibit "A". Lessee shall not be allowed at any time to park in the street.
              D. Lessee will activate the fire alarm system in Lessee's name and
is responsible for all of its utilities.
              E. Lessor shall be responsible for the landscape throughout the
duration of the lease.

56. Recordation. Lessee shall not record this Lease, or a memorandum thereof,
without the prior written consent of Lessor, which may be withheld in Lessor's
sole discretion.

57. Recycle Agreement. Lessor and Lessee are parties to that certain Waste
Recycle Agreement dated June 27, 2003 (the "Recycle Agreement"). In the event of
a conflict between any of the terms and provisions of this Lease, and any of the
terms and provisions of the Recycle Agreement, the terms and provisions of this
Lease shall prevail. It is the intent of the parties hereto that the term of the
Recycle Agreement and the term of this Lease shall be coterminous. Upon the
expiration or earlier termination of this Lease, the Recycle Agreement shall
automatically terminate without the necessity for notice. Similarly, upon the
expiration or earlier termination of the Recycle Agreement, this Lease shall
automatically terminate without the necessity for notice.

58. Permits and Approvals. Lessee shall be solely responsible for obtaining all
required land use approvals and permits to construct any improvements or make
any alterations at the Premises, and to operate the Premises. The cost of all
permits, authorizations or approvals for the use of the Premises, including
without limitation all capital and maintenance expenditures associated with
making the Premises suitable for the implementation of the terms of the Recycle
Agreement and the Lease, shall be the sole expense of Lessee. Promptly following
the date of this Lease, Lessee shall make any necessary applications and use
commercially reasonable efforts to obtain any necessary permits or approvals for
the construction, development, use and operation of the Premises in accordance
with this Lease and the Recycle Agreement (the "Approvals"). Lessee shall
provide to Lessor copies of any applications for approvals or permits, and
status reports of the same, upon Lessor's request. Lessee shall not apply for
any change in the land use or zoning designation of the Premises without the
prior written consent of Lessor. Lessee shall provide Lessor with bi-weekly
reports on the status of all permits and approvals for the Premises and the use
and occupancy thereof by Lessee; provided, however, that the failure by Lessee
to materially comply with the requirement of providing bi-weekly status reports
shall not constitute a Breach or Default of this Lease. Lessor acknowledges that
Lessor's cooperation and assistance may be requested by Lessee, and Lessor
agrees to reasonably cooperate and assist Lessee in good faith, at no cost or
expense to Lessor.

59. RMSW. Lessee represents and warrants that it has evaluated the waste stream
to be delivered by Lessor pursuant to the Recycle Agreement, that it is familiar

                                    10.4-29
<PAGE>
with the composition of the "RMSW" (as defined in the Recycle Agreement) that
will be delivered to Lessee by Lessor at the Premises, and Lessee has determined
based on its investigation and evaluation that the RMSW is acceptable and
suitable to Lessee for the purposes set forth in the Recycle Agreement and this
Lease.

60. Delivery of RMSW. Promptly following Lessor's receipt of the Commencement
Notification, Lessor will deliver to Lessee at the Premises, 500 TPD of RMSW, or
such other amount as agreed to by the parties upon reasonable notice to the
other party.

         Lessor shall deliver loads of RMSW to Lessee at the Premises on a 24
hour per day, six (6) day per week basis, as reasonably requested by Lessee, but
excluding Sundays and legal holidays. To the extent reasonably requested by
Lessee and reasonably agreeable to Lessor, Lessor shall provide more than 500
tons of RMSW on Fridays and Saturdays, to enable Lessee to operate on Sundays.
The RMSW shall be placed in a location on the Premises reasonably designated by
Lessor.

         The composition of the RMSW may be adjusted as mutually agreed upon in
writing by Lessor and Lessee; provided, however, that nothing contained in this
Agreement shall require Lessor to sort or otherwise process the RMSW to be
delivered to Lessee in a manner which is different than the normal and customary
process used by Lessor in its operations which Lessee has evaluated and
warranted is suitable for purposes of the Recycle Agreement and this Lease.

         Payment of net tipping fees, as required under the Recycle Agreement,
shall be made to Lessee in U.S. Dollars as per the reasonable direction of
Lessee. Terms of payment shall be net 30 days following Lessee's invoice date.
All amounts which are not paid by Lessor as and when due and payable shall be
subject to a late charge equal 1.5 (1.5%) percent per month (or if less, the
maximum allowed by applicable law).

61. Use of Premises. Lessor will have final approval over the plans and
specifications for the construction, use and occupancy of the Premises by
Lessee. Such approval may include the attachment of conditions to the operation
of the Premises which govern, without limitation, how vehicles enter and exit
the Premises, how "WWA Residual" (as defined in the Recycle Agreement) is picked
up/loaded, the exterior appearance of the Premises, and all regulatory
compliance issues.

62. Duties and Obligations of Lessee. Within sixty (60) days following the date
of this Lease, Lessee shall deliver to Lessor for its review and approval, plans
and specifications for any alterations or improvements to the Premises which
will be made by Lessee. Lessor will review such plans and specifications within
fifteen (15) days following the date of receipt of complete copies thereof, and
provide its approval, rejection or suggested modifications to the plans and
specifications provided by Lessee. Lessor shall have the right to attach
reasonable conditions to the approval of such plans and specifications.

         Within two hundred forty (240) days following the date of this Lease
(the "Permitting and Construction Period"), Lessee shall have (a) obtained all
necessary Approvals for the construction, alteration, use and occupancy of the
Premises, and (b) completed any alterations or improvements to the Premises.
Upon Lessee's completion of items (a) and (b) above, Lessee shall send to Lessor

                                    10.4-30
<PAGE>
written notification that Lessee has satisfied items (a) and (b), and is ready
and able to begin accepting RMSW at the Premises in accordance with the Recycle
Agreement and this Lease (the "Commencement Notification"). In the event Lessee
does not deliver to Lessor the Commencement Notification on or before the
expiration of the Permitting and Construction Period, then Lessor shall have the
right, but not the obligation, to terminate this Lease and the Recycle Agreement
upon written notice to Lessee, delivered prior to the date Lessor receives a
Commencement Notification.

         Lessee shall accept and process during the Term of this Lease and the
Recycle Agreement the RMSW delivered to the Premises from Lessor, in the amounts
set forth above. Lessor shall not allow any RMSW to accumulate at the Premises,
and shall process such amounts as the same are received. In the event Lessee
fails to process the amount of RMSW delivered to the Premises by Lessor, as
required by this Lease and the Recycle Agreement, and Lessor is required to
retrieve such amounts, then Lessee shall be responsible for any costs or
expenses incurred by Lessor in connection therewith, including, without
limitation, any fees, costs or expenses to retrieve, load and transfer (and in
any event to exclude disposal cost) the RMSW previously delivered to the
Premises which remains unprocessed. In the event Lessee fails accept and process
the RMSW as required by this Lease and the Recycle Agreement, or fails to
reimburse such costs and expenses to Lessor following any written notice and
cure period provided below, Lessor shall have the right, in addition to any
other remedy available to Lessor hereunder, to either (a) terminate this Lease
and the Recycle Agreement (in which event Lessor shall have the right to keep
any Prepaid Rent or Security Deposit), (b) suspend the delivery of RMSW to
Lessee until such time as Lessor deems it appropriate to continue, or (c) offset
any such costs and expenses incurred by Lessor from any payments due to Lessee
from Lessor hereunder.

         Lessee shall store any large or bulky items inadvertently delivered in
the RMSW by Lessor which cannot be processed, on the Premises in a location and
manner reasonably acceptable to Lessor, until such materials can be removed by
Lessor.

63. Compliance. If Lessor determines that Lessee's operations are not in
compliance with any applicable law or regulation, or determines that Lessee's
continued operations would place or threaten to place Lessor's operations in
non-compliance with its permits and approvals, and such failure is not remedied
within any notice and cure period provided below, then Lessor may either (a)
terminate this Lease and the Recycle Agreement upon written notice to Lessee, or
(b) temporarily suspend delivery of RMSW to Lessee until such time as Lessor
determines that the non-compliance or potential non-compliance issue has been
addressed to Lessor's satisfaction.

64. Intentionally Deleted.

65. Additional Facility. Subject always to the satisfaction of each of the
conditions set forth in this Paragraph, and provided that Lessee is not in
default or breach of this Lease or the Recycle Agreement, and Lessor and Lessee
acknowledge a mutual desire to expand the relationship between the parties, to
an additional facility located in Orange County, California which is capable of
accepting and processing up to 2,000 TPD of Lessor's RMSW (the "Additional
Facility"). In the event Lessee locates a new facility in Orange County,
California, which is suitable for the Additional Facility, Lessee shall notify

                                    10.4-31
<PAGE>
Lessor and provide to Lessor all relevant information regarding the location of
the site, and the proposed design of the Additional Facility. The location of
the Additional Facility must be in Orange County, California, and the site shall
be reasonably acceptable to Lessor. Following the approval of the site by
Lessor, Lessor and Lessee shall undertake the negotiation of a new agreement for
the Additional Facility, on terms which are acceptable to both parties. The term
of such agreement shall be a declining term, equal to (x) ten (10) years, less
(y) the number of years expired under this Lease. For example, if the new
agreement is executed by the parties two (2) years from the date of this Lease,
the term of such new agreement shall be eight (8) years. In the event the site
is acceptable to Lessor, and the parties have executed a new agreement for the
Additional Facility on terms which are acceptable to each party, Lessee shall
locate, design and construct the new facility for the acceptance and processing
of Lessor's RMSW.

66. Notices. Any notice to the parties required or permitted under this Lease or
the Recycle Agreement shall be given in writing and may be delivered in person
(by hand or by courier) or may be sent by certified mail or reputable overnight
courier, to the following addresses:

         If to TI:         Taormina Industries, LLC

                           1131 North Blue Gum Street

                           Anaheim, CA  92806

                           Attn:  Thomas Vogt, President

         With a copy to:   Republic Services, Inc.

                           110 S.E. 6th Street, 28th Floor

                           Ft. Lauderdale, FL 33301

                           Attn:  General Counsel

         If to WWA:        World Waste of Anaheim

                           13520 Evening Creek Drive, Suite 130

                           San Diego, CA  92128

                           Attn:  Thomas L. Collins, CEO

Notices sent by certified mail, return receipt requested, shall be deemed given
on the date of delivery shown on the receipt card, or if no delivery date is
shown, the postmark thereon. If sent by regular mail the notice shall be deemed
given 48 hours after the same is addressed as required herein and mailed with
postage prepaid. Notices delivered by overnight courier that guarantees next day
delivery shall be deemed given 24 hours after delivery of same to the courier.

                                    10.4-32
<PAGE>
67. Inventory. Lessee shall promptly remove from the Premises all material
resulting from the processing of RMSW in accordance with the Recycle Agreement
and this Lease that is suitable for beneficial reuse (the "Wet Lap"). Lessee
shall not store or retain inventory volumes of Wet Lap on the Premises which
exceeds the results from five (5) business days processing activities. Title to
all Wet Lap shall be transferred by Lessee to third parties for beneficial
reuse, as evidenced by a report delivered to Lessor by Lessee on a quarterly
basis during the Term.

68. Default by Lessee or Lessor under the Recycle Agreement. A "default" under
the Recycle Agreement is defined as a failure by either party to comply with or
perform any of the terms, covenants, conditions or obligations under the Recycle
Agreement, which default continues for a period of thirty (30) days following
written notice (except in the event any such default may adversely affect
Lessor's permits or approvals for its operations, in which case the notice and
cure period shall be five (5) days or such shorter period of time set forth in
any notice of violation from a governmental entity)). Notwithstanding the
foregoing, neither party shall be required to provide more than three (3)
written notices of default and a cure period in any twelve (12) month period (or
more than one (1) written notice of default and a cure period in any twelve (12)
month period in the event any such default may adversely affect Lessor's permits
and approvals).

         In the event of a default by Lessee, Lessor shall have any or all of
the following remedies:

         (a) terminate the Recycle Agreement and this Lease upon written notice
to Lessee;

         (b) perform such duty or obligation on Lessee's behalf, whereupon
Lessee shall pay to Lessor an amount equal to 115% of the costs and expenses
incurred by Lessor in such performance upon the receipt of an invoice therefore
(failing which Lessor shall have the right to offset such unpaid amount from any
amounts payable to Lessee under this Lease or the Recycle Agreement);

         (c) withhold performance under this Lease or the Recycle Agreement
until such time as the default by Lessee has been cured; or

         (d) pursue any other remedy now or hereafter available under the laws
or judicial decisions of the State of California.

         In the event of a default by Lessor, Lessee shall have the right to
either (a) terminate this Lease and the Recycle Agreement, (b) pursue any other
remedy now or hereafter available under the laws of the State of California, or
(c) withhold performance under this Lease or the Recycle Agreement until such
time as the default by Lessor has been cured; provided, however that the remedy
set forth in item (c) shall only be available to Lessee in connection with a
default by Lessor relating to the non-payment of any amounts due to Lessee under
this Lease or the Recycle Agreement, which non-payment does not relate to a
claim of default by Lessor against amounts owed to Lessee under this Lease or
the Recycle Agreement.

69. Termination Right. If, during the first eighteen (18) months following the
date of this Lease, Lessee reasonably determines that it is unable to continue
the project in accordance with this Lease and the Recycle Agreement, and

                                    10.4-33
<PAGE>
provided that Lessee is not then in default under this Lease or the Recycle
Agreement, Lessee shall have the right to terminate this Lease and the Recycle
Agreement upon written notice to Lessor, provided such notice is received by
Lessor on or before the last day of the eighteenth (18th) month following the
date of this Lease. Upon receipt of Lessee's notice, this Lease and the Recycle
Agreement shall terminate, provided, however, that Lessor shall retain the
Security Deposit as consideration for the agreement to allow Lessee to
terminate. In the event Lessee fails to deliver the written notice to Lessor as
set forth herein, Lessee's right to terminate this Lease and the Recycle
Agreement pursuant to this Paragraph 69 shall be deemed waived by Lessee.

70. Confidentiality and Proprietary Information.

         70.1 The parties hereto acknowledge that, in the course of performing
their respective duties under this Lease and the Recycle Agreement, they may
obtain information relating to the other party which is of a confidential and
proprietary nature ("Proprietary Information"). Such Proprietary Information may
include, without limitation, the terms of the Recycle Agreement, trade secrets,
know-how, inventions, techniques, processes, programs, algorithms, schematics,
data, solid waste pricing, materials recovery processing, information, routing
information, customer lists, financial information and sales and marketing
plans. Each party an d its employees and agents shall, at all times, both during
the terms of this Lease and the Recycle Agreement and after their termination,
keep in trust and confidence all such Proprietary Information, and shall not use
such Proprietary Information other than as reasonably required in the course of
their duties as expressly provided in this Lease or the Recycle Agreement
("Permitted Us"); nor shall either party or its employees or agents disclose any
such Proprietary Information to any person or entity without the Discloser's (as
defined herein) prior written consent. The recipient of any Proprietary
Information ("Recipient") acknowledges that any such Proprietary Information
received shall be received as a fiduciary of the disclosing party ("Discloser").
Recipient shall not be bound by this Paragraph 70 with respect to information
Recipient can document (a) is or becomes generally known to the public through
no fault or breach of this Lease or the Recycle Agreement by the Recipient; (b)
is known to the Recipient at the time of disclosure without an obligation of
confidentiality; (c) is independently developed by the Recipient without access
to or use of the Discloser's Proprietary Information; or (d) is disclosed with
the prior written approval of the Discloser.

         70.2 Notwithstanding the foregoing, each party may disclose Proprietary
Information of the other party under the following limited circumstances: (a) as
required by law; (b) pursuant to the order or requirement of a court,
administrative agency, or other governmental body, provided that the disclosing
party gives at least ten (10) court days prior written notice to the other
party, or immediate notice if the period to respond to such order or requirement
is less than 21 calendar days by means of facsimile transmission, electronic
mail or other expedited delivery to allow the other party to contest such order
or requirement with the prior written consent of the other party; and (d) as
required by or deemed advisable in connection with under state and federal
securities laws.

         70.3 Notwithstanding anything contrary in this Lease or in the Recycle
Agreement, no license or other right is granted, either directly or indirectly,
by implication, estoppel or otherwise, to either party with respect to any

                                    10.4-34
<PAGE>
patents or patent applications, trademarks, copyrights, trade secrets, computer
programs, know-how, processes, mask works or other intellectual property rights
of the other party.

         70.4 Neither party shall reverse assemble, decompile, reverse engineer
or otherwise attempt to derive the underlying trade secrets, ideas, algorithms,
processes, structure or organization from the other's Proprietary Information or
from any other information of the other party's.

71. Non-Competition and Right of First Refusal for Co-Ownership of Future
Projects. Lessor and Lessee agree that notwithstanding anything to the contrary
set forth in this Lease and the Recycle Agreement, the provisions of Paragraph
I. of the Recycle Agreement shall survive any termination of this Lease or the
Recycle Agreement, until the expiration of the then-existing Term of this Lease.
For example only, if this Lease and the Recycle Agreement is terminated by
Lessee on the twelfth (12th) month following the date of this Lease pursuant to
Paragraph 69 of this Lease, then the provisions of Paragraph I. of the Recycle
Agreement shall survive such termination and be applicable during the remaining
nine (9) years of the Original Term of this Lease.

72. Rent Deferral. The parties agree to waive the "Rent Deferral" as described
in Paragraph C. of the Recycle Agreement.

73. Conflict In the event of a conflict between the terms and provisions of the
Lease, and the terms and provisions of this Addendum, the terms and provisions
of this Addendum shall prevail.

LESSOR AND LESSEE HAVE CAREFULLY READ AND REVIEWED THIS LEASE AND EACH TERM AND
PROVISION CONTAINED HEREIN, AND BY THE EXECUTION OF THIS LEASE SHOW THEIR
INFORMED AND VOLUNTARY CONSENT THERETO. THE PARTIES HEREBY AGREE THAT, AT THE
TIME THIS LEASE IS EXECUTED, THE TERMS OF THIS LEASE ARE COMMERCIALLY REASONABLE
AND EFFECTUATE THE INTENT AND PURPOSE OF LESSOR AND LESSEE WITH RESPECT TO THE
PREMISES.

The parties hereto have executed this Lease at the place and on the dates
specified above their respective signatures.

By LESSOR:                            By LESSEE:
Taormina Industries, LLC              World Waste of Anaheim, Inc.

By:__________________________________ By:_______________________________________
Name Printed:________________________ Name Printed:_____________________________
Title:_______________________________ Title:____________________________________
Date:________________________________ Date:_____________________________________

                                    10.4-35

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