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                                                                    EXHIBIT 10.7

                                  GROUND LEASE

STATE OF ARKANSAS )
                  )   KNOW ALL MEN BY THESE PRESENTS:
COUNTY OF PULASKI )

     This Lease (hereinafter referred to as "Lease" or "Agreement") made and
entered into on this 1st day of February, 2001, by and between CONSERVATIVE
DEVELOPMENT COMPANY d/b/a LAKEWOOD VILLAGE SHOPPING PARK, an Arkansas
corporation (hereinafter called "Landlord"), and TWIN CITY BANK, an Arkansas
chartered banking corporation, (hereinafter called "Tenant"), which provides as
follows:

                       SECTION 1. GRANT OF LEASE AND TERM

     1.1 Landlord does hereby lease and demise unto Tenant that certain real
property in the City of North Little Rock, Pulaski County, Arkansas, being a
part of the LAKEWOOD VILLAGE SHOPPING CENTER, hereinafter referred to as the
"Shopping Center", as shown in Exhibit "A" attached hereto with the property
being leased identified as the cross-hatched area in Exhibit "A" attached hereto
(hereinafter referred to as the "leased premises" or "premises") and containing
approximately 44,140 square feet, such description being subject to amendment as
set forth in Paragraph 5.3 hereof. This Lease shall be for a term of ten (10)
years (the "Initial Term") to begin on the "Commencement Date" as defined in
Section 5.8 hereof.

                          SECTION 2. OPTIONS TO EXTEND

     2.1 Landlord hereby grants to tenant two (2) separate but consecutive
rights and option to extend this Lease for separate extension periods of ten
(10) years each immediately following the expiration of the Initial Term of this
Lease.

     2.2 In order to exercise its option for the first extension period, Tenant
shall (i) not then be in default under this Lease and (ii) shall give written
notice to Landlord of its exercising of its option for the extension period not
later than one hundred eighty (180) days prior to the expiration of the Initial
Term of this Lease.

     2.3 In order to exercise its option for the second extension period, Tenant
shall (i) not then be in default under this Lease; (ii) have exercised its first
option hereof; and (iii) shall give written notice to Landlord of its exercising
of

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its option for the second extension period not later than ninety (90) days prior
to the expiration of the first extension period of this Lease.

     2.4 The extension periods shall be subject to and governed by the same
identical terms, covenants and conditions of the Initial Term of this Lease
except in respect to the termination date and for the rentals which are set
forth in Section 3 hereof.

     If Tenant remains in possession of the premises after expiration of any
lease term without executing a new lease or exercising its option to extend,
such holding over shall be construed as a tenancy from month-to-month, subject
to all covenants and conditions of this Lease. Upon such holding over, Tenant
must vacate the premises within thirty (30) days after receiving written notice
from Landlord to vacate.

                                 SECTION 3. RENT

     3.1 The Minimum Rent (herein so called) for this Lease during the Initial
Term and extension periods shall be payable in monthly installments, with each
installment payable in advance on or before the first day of each calendar month
during the Initial Term and each extension period. The amount of Minimum Rent to
be paid by Tenant to Landlord shall be pursuant to the following:

          (a)  for the Initial Term, monthly rental shall be FIVE THOUSAND AND
               NO/100'S DOLLARS ($5,000.00);

          (b)  for the first ten (10) year option extension term (provided
               Tenant timely exercises its option as provided above), the
               monthly rental shall be SIX THOUSAND TWO HUNDRED FIFTY AND
               NO/100'S DOLLARS ($6,250.00);

          (c)  for the second ten (10) year option extension term (provided
               Tenant timely exercises its option as provided above), the
               monthly rental shall be SEVEN THOUSAND EIGHT HUNDRED TWELVE AND
               50/100'S DOLLARS $(7,812.50).

     3.2 Each installment of rent shall be in lawful money of the United States
of America, shall be paid without any deduction, offset or abatement, and shall
be payable to Landlord at the address below:

          Conservative Development Company
          2851 Lakewood Village Drive
          North Little Rock, AR 72116

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or at such other place as the Landlord may from time to time designate in
writing.

     3.3 If the Commencement Date as defined herein is not on the first day of a
calendar month, the Minimum Rent for the period between the Commencement Date
and first day of the next succeeding calendar month shall be apportioned at the
monthly rental set forth above, and the amount so apportioned shall be payable
on the Commencement Date. Likewise, the Minimum Rent for the period between the
first day of the last calendar month during the term and ending date of the
Lease shall be apportioned at the then current monthly Minimum Rent.

     3.4 For purposes hereof, the term "rent" or "rental" shall mean
collectively the Minimum Rent and all other sums required to be paid by Tenant
hereunder.

                            SECTION 4. FORCE MAJEURE

     4.1 Whenever a period of time is herein prescribed for action to be taken
by Landlord or Tenant, such party shall not be liable or responsible for, and
therefore shall be excluded from the computation of any such period of time, any
delays due to strikes, riots, acts of God, shortages of labor or materials, war,
governmental laws, regulations or restrictions or any other causes of any kind
whatsoever which are beyond the reasonable control of the respective party,
provided, however, the Landlord's or Tenant's liability of responsibility shall
only be excused for the number of days resulting from such delay.
Notwithstanding the foregoing, in no event shall this Section 4 excuse or delay
Tenant's obligation to timely pay any rentals required hereunder.

                             SECTION 5. IMPROVEMENTS

     5.1 Following the waiver of all Tenant's rights to terminate this Lease,
the Tenant agrees to construct on the leased premises a Bank Building with drive
through teller service facilities (the "Approved Business") in accordance with
the prototype plans and specifications (the "Plans") forwarded to Landlord and
incorporated by reference. The Approved Business will be constructed pursuant to
the construction contract entered into by Tenant with a reputable and bondable
general construction contractor ("Contractor"); provided, however, if the
Contractor shall use union employees on the job it will be subject to the
approval of Landlord. Tenant covenants and agrees to pursue construction of the
Approved Business to its completion with all reasonable diligence subject to
extension for any event of Force Majeure as provided in Section 4 hereof. The
Approved Business

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shall be constructed in a good and workmanlike manner in compliance with all
applicable permits, authorizations, building codes, and all other applicable
laws, ordinances, rules and regulations of any governmental authorities having
jurisdiction. The Approved Business shall be the building described in the Plans
and no material alterations of the height and architectural design of the
Approved Business or signage shall be made without the prior written consent of
Landlord which consent shall not be unreasonably withheld or delayed. Tenant
shall have no right, authority, or power to bind Landlord, or any interest of
Landlord in the leased premises, for any claim for labor or material or for any
other charge or expense incurred in the construction of the Approved Business or
any change, alteration, or addition thereto, or any replacement or substitution
therefor, nor to render the Landlord's interest in the leased premises liable to
any lien or right of lien for any labor or material and Tenant shall in no
manner be considered as the agent of Landlord in the construction, erection, or
operation of the Approved Business or any replacement or substitution therefor.
If any involuntary liens for labor and materials supplied or claimed to have
been supplied to the leased premises shall be filed, Tenant shall promptly pay
or bond such liens to Landlord's reasonable satisfaction or otherwise obtain the
release or discharge thereof and Tenant shall indemnify and hold Landlord
harmless from the payment thereof.

     5.2 Landlord, including its agents, employees and architects, if any, shall
not be liable to Tenant or any other party for any loss, claim, or demand
asserted on account of Landlord's exercise of its rights and duties hereunder,
or any failure or defect in such exercise. No approval of designs, site plans,
plans, specifications, or other matters shall ever be construed as representing
or implying that such designs, site plans, plans, specifications, or other
matters will, if followed, result in a properly designed Approved Business or
other improvements constructed in addition to or as substitute or replacement
for the Approved Business. Such approval shall in no event be construed as
representing or guaranteeing that any improvements will be built in a
workmanlike manner, nor shall such approvals relieve Tenant of its obligation to
construct the Approved Business in a workmanlike manner as provided in Section
5.1 above. Tenant will hold Landlord harmless and will indemnify Landlord from
and against any suits, actions, or causes of action for injuries to persons or
property for design or construction failures arising out of Landlord's approval
of any designs, site plans, plans, specifications or other matters.

     5.3 Title to all improvements and all equipment, fixtures and machinery
therein contained and all furniture and furnishings of Tenant therein erected,
constructed, installed or placed shall be and remain in Tenant during the term
of this Lease. Upon the

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expiration or termination of this Lease, title to all improvements and permanent
fixtures then owned by Tenant situated on the leased premises shall
automatically vest in Landlord and Tenant shall have no claim thereto. Provided
however, Landlord may give Tenant written notice of Landlord's disclaimer of
said improvements within thirty (30) days of the expiration of termination of
this Lease in which event Tenant shall have sixty (60) days from said expiration
or termination in which to remove all such improvements and fixtures from the
leased premises and restore same to even ground level. Upon expiration or
termination of this Lease, Tenant shall promptly remove all items of personal
property, machinery and equipment from the leased premises to the extent such
removal does not cause damage to the Approved Business, Tenant, at its sole cost
and expense, shall promptly repair any damage caused by such removal. If Tenant
fails to remove such items of personal property within thirty (30) days
following the expiration or termination of this Lease, title to such items of
personal property shall vest in Landlord and Tenant shall have no further claim
thereto.

     5.4 Tenant shall have the right, from time to time, to make additions,
alterations and changes in or to the Approved Business, provided Tenant is not
then in default of the Lease and Tenant fully complies with all of the following
provisions:

     (a)  No structural alterations of the Approved Business or signage shall be
          commenced except after receipt of Landlord's written approval thereof,
          which shall not be unreasonably withheld or delayed;

     (b)  Without the consent of Landlord (not to be unreasonably withheld or
          delayed), no alterations of any kind shall be made which would (i)
          impair the structural soundness of the Approved Business, (ii)
          decrease the gross area of the building, except as may be required by
          governmental regulations, or (iii) modify the function as an operation
          of the Approved Business;

     (c)  No alterations shall be undertaken until Tenant shall have procured
          and paid for all required permits and authorizations of all
          governmental authorities having jurisdiction; provided, however, if
          the general contractor performing such work shall use union employees
          on the job, then the general contractor shall be subject to the
          approval of Landlord;

     (d)  No alterations in excess of $25,000 shall be made except in
          substantial accordance with detailed plans and specifications prepared
          by Tenant and approved in writing by Landlord which consent shall not
          be unreasonably withheld or delayed;

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     (e)  Any alterations shall be made within a reasonable time (delay by force
          majeure as provided in Section 4 excepted) in a good and workmanlike
          manner, and in compliance with all applicable permits, authorizations,
          building codes, and all other applicable laws, ordinances, rules and
          regulations of any governmental authority having jurisdiction;

     (f)  If any involuntary liens for labor and materials supplied or claimed
          to have been supplied to the premises shall be filed, Tenant shall
          promptly pay or bond such liens to Landlord's reasonable satisfaction
          or otherwise obtain the release and discharge thereof within thirty
          (30) days from the filing of same;

     (g)  As to those portions requiring Landlord's approval, Tenant shall
          obtain and maintain in existence such insurance as Landlord may
          reasonably require with regard to the alterations; and

     5.5 Tenant acknowledges and agrees that utility lines including water,
sewer, gas and electric and phone service have been provided to a boundary line
of the leased premises. Landlord makes no warranty express or implied as to the
adequacy or suitability of said utility lines for use by Tenant in the operation
of Tenant's business. In the event Tenant determines that said utility lines are
not adequate or suitable for use in the operation of Tenant's business, Tenant
at its sole cost and expense and with Landlord's prior consent shall pay for any
and all improvements or upgrades to such lines. In no event shall any work to
improve or upgrade such lines unreasonably interrupt or interfere with any other
tenants' operations in the Shopping Center.

     5.6 The improvements referred to in Paragraph 5.1 above shall not be deemed
to include any machinery, equipment, trade fixtures, sign faces and cabinets,
furniture, furnishings, decorations, restaurant equipment, shelving, showcases,
mirrors, pictures, art objects, antique items, decorative light fixtures,
mantles, and stained glass windows, cameras, VCRs, infrared alarms, ATM machine.
ATM facility, teller pedistals, undercounter storage units, vaults, alarm boxes,
safe deposit drawers, night deposit drawers or other similar items of personalty
which may be installed, located or placed in the building by Tenant (whether
"attached" to the building or not), and such items may be removed by Tenant from
time to time in Tenant's sole discretion during

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this Lease and for a period of thirty (30) days after termination of this
Lease, provided however. Tenant shall repair all damages to the premises
resulting from or caused by the removal of such items and any such repairs shall
insure that the premises is left in a weather tight condition. Tenant may
finance or refinance all or any part of its machinery, equipment, trade
fixtures, signs, and other items listed above and in connection therewith may
grant security interests in and liens upon such items, provided that Tenant
shall not grant or place any liens upon the realty comprising the leased
premises or Landlord's interests therein. Landlord hereby expressly waives any
liens, constitutional, statutory or otherwise, which Landlord may have with
respect to any such items, and Landlord will execute and deliver or cause to be
executed and delivered such evidence of this waiver of lien as Tenant's
equipment lender or lessor may request from time to time.

     5.7 The parties hereto agree that this Lease is entirely contingent upon
the leased premises being suitable for the Approved Business Tenant intends to
construct upon the leased premises. Consequently, notwithstanding anything to
the contrary herein set forth, this Lease shall be null and void and neither
party shall be under any obligation or liability one to the other in the event
the Tenant in its reasonable business judgment determines that for economic
reasons the premises are not suitable for its Approved Business and/or that it
cannot obtain all permits necessary to construct and operate its intended
Approved Business, such permits and approvals specifically including, but not
limited to, sign permits, access points, and building construction permits.
Tenant shall submit for its building permit within forty-five (45) days after
execution of this Lease.

     Tenant shall have ninety (90) days from the date of the mutual execution of
this Agreement in order to make the inspections deemed necessary by Tenant and
to give written notice to Landlord that it has determined that the premises are
not suitable for its Approved Business and/or that the necessary permits are not
obtainable and in such event this Lease shall terminate and neither party shall
have any liability to the other. Tenant's failure to give written notice within
such ninety (90) days shall be deemed a waiver of this condition precedent and
all other inspections and contingencies with regard to the leased premises
pursuant to Paragraph 5.8. As a part of Tenant's inspection, Tenant and its
consultants shall be permitted to come upon the leased premises to perform soil
tests, inspections, and other studies, to be used by Tenant in determining
feasibility of construction and to determine the environmental conditions of the
premises and existing improvements. Tenant shall restore the premises to its
condition prior to any such tests, and shall indemnify and hold Landlord

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harmless from any liabilities, costs and expenses arising from Tenant's
inspections, including, without limitation, liens that may arise as a result
thereof.

     5.8 If this Lease is not terminated as provided in Paragraph 5.7 above,
Tenant shall enter the premises and commence the construction of its
improvements, and the rental hereunder shall commence upon the earlier of:

          (a)  the date Tenant first opens for business to the public in the
               permanent bank building on the premises; or

          (b)  Three hundred sixty-five (365) days from May 1, 2000, the date
               Tenant took possession of the premises.

     The date which is applicable for the payment of rental pursuant to the
foregoing shall be the "Commencement Date".

     5.9 Tenant and persons, firms or corporations involved in the erection of
the Approved Business contemplated herein and Tenant's subtenants, employees,
agents, servants, patrons, and suppliers may enter upon and work in and on the
leased premises during the period prior to the Commencement Date, and all
covenants and conditions of this Lease shall be applicable except those
pertaining to rental and taxes; no rental or other monetary payments being
reserved or charged for such period prior to the Commencement Date. Tenant shall
hold Landlord harmless from any lien or claims for liens as a result of Tenant's
actions during such period prior to the Commencement Date.

             SECTION 6. STATE OF THE TITLE, ZONING AND RESTRICTIONS

     Landlord hereby warrants and represents to Tenant as follows:

     6.1 Landlord is owner of the leased premises and authorized to execute this
Lease and that the leased premises are zoned by the appropriate governmental
agency to permit the construction and operation of the Approved Business.

     6.2 No person other than Landlord has the right to lease the leased
premises.

     6.3 Landlord agrees that it has not and will not hereafter enter into or
consent to any restrictive covenant or similar agreement substantially or
materially affecting Tenant's use of the leased premises.

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                            SECTION 7. USE BY TENANT

     7.1 The leased premises shall be used for the operation of a Twin City Bank
branch banking facility. Tenant shall not commit waste on the leased premises,
shall not maintain, commit or permit the maintenance or commission of any
nuisance on the leased premises, or use the premises for illegal purposes.
Tenant shall conform to all applicable laws and ordinances respecting the use
and occupancy of the leased premises. Neither Tenant nor any party operating in
the premises by or through Tenant shall use or operate in the premises or permit
any other party to use or operate in the premises in any manner which shall
violate any exclusive right granted by Landlord to any other tenant in the
Shopping Center or which shall materially and unreasonably interfere with any
other tenant's business operations in the Shopping Center.

     7.2 Tenant shall maintain its windows in a neat and clean condition, shall
keep sidewalks on the premises clean and free from rubbish, and shall arrange
for the regular pick up of trash and garbage if such service is not provided by
the City or County in which the leased premises are located. Tenant shall not
permit rubbish, refuse or garbage to accumulate or any fire or health hazard to
exist about the premises, so long as this Lease is in effect and during any
extension thereof. Trash and garbage dumpsters shall be screened from view.

     7.3 During the Initial Term of this Lease and any option extension term
thereafter, Tenant shall in good faith continuously conduct and carry out in the
entire leased premises the type of business described in Section 7.2 above
except for periods resulting from fire or other casualty, or reasonable periods
for repairs and alterations, all such repairs and alterations to be diligently
pursued to completion. If Tenant discontinues the operation of its business or
vacates the leased premises for any continuous two (2) month period (other than
as a result of fire or other casualty, for substantial restoration or
alteration, such restoration, alterations or repairs to be diligently pursued to
completion), Landlord may terminate this Lease and repossess the leased
premises. Upon repossession, this Lease will terminate and neither party shall
have any further obligation to the other except for the following:

          Tenant shall forfeit all of Tenant's permanent improvements to the
     leased premises, but may remove its furniture, fixtures, equipment and all
     signs provided that any resulting damage therefrom shall be promptly
     repaired by Tenant.

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    SECTION 8. MAINTENANCE, REPAIRS AND UTILITIES AND COMMON AREA MAINTENANCE

     8.1 Tenant shall keep and maintain at its sole cost and expense the
interior and exterior of all improvements placed on the leased premises
including without limitation all structural maintenance, all nonstructural,
exterior and interior maintenance, all mechanical, electrical, plumbing,
sprinkler, HVAC system, landscaping, parking areas and parking area lighting, in
good repair subject to normal wear and tear. Tenant shall have the duty to
maintain, sweep, paint and stripe, patch and repair the paving of all parking
areas on the leased premises.

     8.2 Tenant shall, at its own cost and expense, pay directly all charges
when due for water, gas, electricity, heat, sewer rentals or charges and any
other utility charges incurred by Tenant in the construction and the use of the
premises. Unless caused by Landlord's negligence or misconduct, Landlord shall
not be responsible or liable in any way whatsoever for the quality, quantity,
impairment, interruption, stoppage or other interference with service involving
water, heat, gas, electric current for light and power, telephone or any other
utility service.

     8.3 Landlord and its agents and other representatives shall have the right
to enter into and upon the leased premises or any part thereof at all reasonable
hours for the purpose of examining the same. Further, upon Tenant's failure,
neglect or default in the payment of any charges when due for water, gas,
electricity, heat, sewer rentals or other utility charges relating to the
construction and/or use of the premises, Landlord shall have the right to cause
the same to be paid and such costs and expenses with interest thereon at the
maximum rate allowed under applicable law shall be repaid by Tenant to Landlord
and shall constitute additional rental hereunder.

     8.4 The Common Area is defined to mean that part of the Shopping Center
intended for the common use of all lessees, including, but not limited to,
parking areas, private streets and alleys, landscaping, curbs, loading areas,
sidewalks, lighting facilities, drinking fountains, meeting rooms and public
rest rooms. Landlord reserves the right to change from time to time the
dimensions and location of the Common Area. Landlord agrees to maintain the
Common Area in a good, clean manner as generally accepted in the maintenance of
similar shopping centers in the area where the Shopping Center is located. The
maintenance, repair and replacement of the Common Area shall be within the sole
and absolute control of Landlord. Tenant agrees to pay to Landlord, as set forth
below, for the repair, operation and maintenance of the Common Area (including,
among other costs,

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those for lighting, painting, cleaning, policing, inspecting, repairing and
replacing) which may be incurred by Landlord, in its discretion, including a
reasonable allowance for Lessor's overhead costs and for depreciation of
maintenance equipment and for costs of property, casualty and liability
insurance. Tenant agrees to pay as Additional Rent during the Initial Term of
this Lease and any option extension term thereof Common Area costs which shall
be based upon $.50 per square foot of space for a building consisting of
approximately 4,644 square feet which initially computes to $2,322.00 per annum
payable in the amount of $193.50 on the first day of each month for the first
Lease Year and which shall be increased from time to time but not by more than
two percent (2%) for any succeeding calendar year (except no maximum increase
shall be applicable with respect to taxes and insurance). Upon a final
determination of such costs for the preceding Lease year, Landlord shall advise
Tenant of the actual amount of such costs. If the actual costs exceed the amount
estimated, Tenant shall immediately pay to Landlord the balance due; if the
actual costs are less than the amount estimated, then the monthly installments
for the remaining months in the current Lease Year shall be equally reduced by
the difference. All sums required to be paid by Tenant for Common Area
maintenance shall be deemed a part of the Rental payable hereunder.

                      SECTION 9. ASSIGNMENT AND SUBLETTING

     9.1 Tenant shall have the right to assign or sublease the leased premises
to any corporation controlling, controlled by or under common control with
Tenant, to any corporation with which Tenant merges or consolidates, or to any
person or entity acquiring all or substantially all of the assets of Tenant
provided however such assignee or sublessee's business is reasonably similar to
that of Tenant and that such assignee or sublessee's business shall not violate
any exclusive right granted by Landlord to any other tenant in the Shopping
Center. Any other assignment or subletting of this Lease or leased premises by
Tenant shall require the prior written consent of Landlord. Tenant shall not
mortgage, encumber, pledge or collaterally assign the leased premises, the
leasehold estate created hereunder, or any interest of Tenant therein without
the prior written consent of Landlord. Notwithstanding anything to the contrary
above, Tenant shall remain liable for the performance of all obligations and
payment of rents following any such assignment or subletting provided that it
shall be furnished a copy of any notice of default contemporaneously with the
issuance thereof to the existing tenant.

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                          SECTION 10. SIGN AND DISPLAYS

     10.1 Subject to Landlord's written approval of Tenant's Plans and provided
appropriate governmental approvals shall be obtained by Tenant, Tenant shall
have the right at its own cost and expense to erect and maintain a 4' x 8'
freestanding entrance sign at the Shopping Center entrance across from Heritage
Park Circle at its cost and expense. Tenant may at its cost and expense, subject
to Landlord's prior consent and upon receiving all appropriate governmental
approvals, erect larger and/or additional signage located at the Shopping Center
entrance across from Heritage Park Circle. Tenant may erect and maintain such
other signage advertising its business on the interior or exterior of the
building, provided however Landlord has approved such signage and it is in
compliance with all applicable laws, rules and regulations. All signs erected by
Tenant (upon written approval of Landlord) shall be in compliance with the
applicable laws or within a non-conforming use exception allowed by law, and all
such signs or sign faces and cabinets shall be removed by Tenant at any time
during or within thirty (30) days after the expiration of this Lease, provided
any resulting damage shall be promptly repaired by Tenant at its sole cost and
expense.

                         SECTION 11. INSURANCE AND TAXES

     11.1 Tenant shall procure and maintain during the Initial Term of this
Lease or any option extension term thereof fire, extended coverage including
coverage for Landlord's loss of rents and such other casualty insurance as
Landlord deems appropriate for the leased premises and any improvements thereon
from an insurance carrier approved by Landlord. Tenant shall furnish to Landlord
a certificate evidencing such coverage, which shall provide that the insurance
policy shall not be canceled, modified or allowed to lapse without thirty (30)
days prior written notice from the insurance carrier to Landlord. Tenant agrees
to pay all premiums for such insurance on the leased premises building and
improvements constructed on the leased premises for not less than one hundred
percent (100%) of the full replacement value thereof. Tenant covenants to
maintain sufficient liquidity to pay for replacement costs in excess of the one
hundred percent (100%) of full replacement value. The proceeds of any such
policy shall be paid and distributed as follows:

     (a)  If the building is by damage or destruction rendered untenantable in
          whole or substantial part as defined in Section 12.1 hereof, and
          Tenant notifies Landlord in writing within thirty (30) days of such
          damage or destruction of its desire that the improvements be repaired
          or rebuilt, all such proceeds shall be paid to Tenant for use in
          repairing or rebuilding the building

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          and improvements. The rent shall not abate following such damage or
          destruction or at any time during the repair and rebuilding of the
          building and improvements. If Tenant does not give such notice within
          said thirty (30) days of such damage and destruction, this Lease shall
          automatically terminate and all such insurance proceeds from the loss
          of the building and permanent improvements including all proceeds for
          loss of rents shall be paid to Landlord.

     (b)  If the building is not by the damage rendered untenantable in whole or
          substantial part as defined in Section 12.2 of this Lease, all of the
          proceeds shall be paid to Tenant, who shall use them in repairing and
          rebuilding. The rent shall not abate.

     11.2 Tenant shall carry, at Tenant's expense, liability insurance insuring
Tenant and Landlord against all claims for personal injury, wrongful death and
property damage caused by conditions or activities on the leased premises. Both
Tenant and Landlord shall be carried as named insureds on all such policies of
insurance. Such policy shall have a combined single limit of at least
$1,000,000.00. Tenant shall furnish Landlord with appropriate certificates of
insurance evidencing all insurance coverage required hereunder at least fifteen
(15) days prior to the expiration thereof.

     11.3 Tenant's obligation to carry any of the insurance provided herein may
be fulfilled by coverage of a so-called "Blanket Policy" carried and maintained
by Tenant, provided that the certificate of such insurance shall be delivered to
the Landlord. Landlord shall be named as an additional insured, as its interests
exists, on all such policies.

     11.4 Tenant agrees to pay before they become delinquent all real estate and
personal property taxes and special assessments lawfully levied or assessed
against the leased premises and contents thereof. For the lease years for which
this Lease commences and terminates, the provisions of this Section shall apply
and Tenant's liability for its proportionate share of any taxes and assessments
for any such year shall be subject to a pro rata adjustment based on the number
of days of any such year during which the terms of this Lease are in effect.
Tenant shall furnish to Landlord evidence that such taxes have been paid upon
Landlord's written request. Tenant may, in good faith, contest any such taxes
provided it pays any and all taxes finally adjudicated against the leased
premises.

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          SECTION 12. DAMAGE OF DESTRUCTION BY FIRE, WAR OR ACTS OF GOD

     12.1 If the building upon the leased premises is destroyed or substantially
damaged by fire, acts of God, other casualty or peril covered by in fire and
extended coverage insurance (including earthquake), or war ("war" included enemy
aggression, civil riot or commotion, and insurrection) and shall require, in the
Tenant's reasonable judgment, more than one hundred eighty (180) days to rebuild
or repair such, Tenant may notify Landlord that it desires that the improvements
be repaired and/or rebuilt, such notice to be given in writing within thirty
(30) days of such destruction or damage. If such notice is given, Tenant shall
promptly proceed to carry out and accomplish such repair or rebuilding (taking
into consideration the problems, difficulties and delays in obtaining the
insurance proceeds), in accordance with plans and specifications approved by
Landlord if materially different then those previously approved, and all
insurance proceeds received or arising from such destruction or damage shall be
paid to Tenant for use in such repair or rebuilding. The rent shall not abate at
any time following such damage or destruction or during the repair or rebuilding
of the improvements. If such notice of desire for repair and/or rebuilding is
not given by Tenant within said thirty (30) days, this Lease shall terminate
automatically and the rent shall abate from the date of such termination and any
and all insurance proceeds from the loss of the building and improvements and
loss of rents shall be paid to Landlord in accordance with the provisions of
Section 11.l, subparagraph (a).

     12.2 If the building may be repaired, in Tenant's reasonable judgment,
within a ninety (90) day period following any damage, Tenant shall not have the
option to terminate and Tenant shall proceed to repair and rebuild the damage
without unreasonable delay, in accordance with plans and specifications approved
by Landlord if materially different than those previously approved, taking into
account the problems, difficulties and delays attending the obtaining of the
proceeds of the insurance coverage which shall be paid to Tenant. Any approvals
required by Landlord under this Section 12 shall not be unreasonably withheld or
delayed.

                      SECTION 13. INDEMNIFICATION COVENANTS

     13.1 Landlord shall not be liable for, and Tenant shall defend and
indemnify Landlord and save it harmless from and against any and all liability,
damages, costs or expense,

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including attorney's fees, arising from any act, omission or negligence of
Tenant, or its contractors, licensees, agents, servants or employees or arising
from any accident, injury or damage whosoever and by whomsoever caused, to any
person or property, occurring in the premises or any part thereof, unless such
accident, injury or damage shall arise from the negligence of contractors,
licensees, agents, servants or employees of Landlord.

     Except for the negligence of Tenant, its agents or employees, Tenant shall
not be liable for any damage or injury to any property or persons which might
occur on property owned or leased by Landlord near the leased premises of the
adjacent Landlord's Shopping Center, if any. The Landlord hereby agrees to
indemnify, defend and hold harmless Tenant from any claim, liability or damages
incurred by Tenant which are in any way connected to such Shopping Center or
other property owned or leased by Landlord except for liabilities indemnified by
Tenant above. In the event of foreclosure or deed in lieu thereof with respect
to the Shopping Center, Tenant agrees that the foregoing indemnity shall in no
event impose any liability whatsoever on the mortgagee or any successful bidder
at such foreclosure and such indemnity is being given solely by Landlord as to
the period of time prior to foreclosure or deed in lieu thereof. Following such
foreclosure or deed in lieu thereof, such successor owner shall assume the
obligations hereof beginning at the time it succeeds to the interest of the
Landlord.

                        SECTION 14. WAIVER OF SUBROGATION

     14.1 Landlord and Tenant each hereby waives on behalf of itself and its
insurers (none of which shall ever be assigned any such claim or be entitled
thereto through subrogation or otherwise) any and all rights of recovery, claim,
action or cause of action against the other, its agents, officers, or employees,
for any loss or damage that may occur to the leased premises or any improvements
thereto or the shopping center in which the leased premises is located or any
improvement or any personal property therein, by reason of fire, the elements or
any other cause, which are or could be insured against by the terms of a
standard fire and extended coverage insurance policy, regardless of the cause or
origin of the damage involved, including negligence of the other party hereto,
its agents, officers, or employees and regardless of the amount of the
deductible. This release shall not be limited to the liability of the parties to
each other. It shall also apply to any liability to any person claiming through
or under the parties pursuant to a right of subrogation or otherwise. This
release shall apply even if the loss or damage shall have been caused by the
fault or negligence of Tenant or Landlord or any person for whom Tenant or
Landlord

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may be responsible. Each party shall cause its policies with its insurers to
provide for the waiver of subrogation as set forth herein.

                     SECTION 15. LANDLORD'S RIGHT TO INSPECT

     15.1 Landlord expressly reserves the right to enter the premises at
reasonable times during business hours and in a manner so as not to disturb
Tenant's business to inspect or examine the improvements.

                            SECTION 16. SUBORDINATION

     16.1 This Lease shall be subject and subordinate at all times to the lien
of any Deed of Trust or Mortgages now on the premises, and to all advances made
or hereafter to be made upon the security thereof, and subject and subordinate
to the lien of any Deed of Trust or Mortgage or Mortgages which at any time may
hereafter be made a lien upon the premises by Landlord provided, however, that
such subjection and subordination is upon the express condition that this Lease
shall be recognized by the mortgagee and that all the rights of the Tenant shall
remain in full force and effect during the full term of this Lease on condition
that the Tenant shall not be in default pursuant to the terms of this Lease and
further provided that in the event of foreclosure or deed in lieu thereof or any
enforcement of any such mortgage, the right of the Tenant hereunder shall
expressly survive and this Lease shall in all respects continue in full force
and effect. Tenant agrees upon demand to execute such further instruments
subordinating this Lease as Landlord may request, provided such instruments
shall carry the conditions and provisions set forth above.

                       SECTION 17. DEFAULT AND BANKRUPTCY

     17.1 The following shall be deemed events of default of Tenant under this
Lease:

     (a)  The failure of Tenant to pay when due the Minimum Rent, the Percentage
          Rent, or any other Rental or any other sum due under this Lease, and
          such failure continues for a period of seven (7) days after receipt of
          written notice of default from Landlord to Tenant;

     (b)  The failure of Tenant to perform any term, condition, covenant or
          agreement of this Lease, except those described in subparagraph (a)
          above, and the continuation of such failure for a period of thirty

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          (30) days after written notice thereof from Landlord to Tenant, unless
          Tenant has commenced to cure default and continues with diligence to
          complete it;

     (c)  The taking of Tenant's interest in this Lease or the leased premises
          or any part thereof upon execution or by other process of law directed
          against Tenant, or the taking upon or subject to any attachment at the
          instance of any creditor of or claimant against Tenant, and said
          attachment shall not be discharged or disposed of within sixty (60)
          days after the levy thereof;

     (d)  Tenant's financial difficulties as evidenced:

          (i)  By its admitting in writing its inability to pay its debts
               generally as they become due; or

          (ii) By its filing or having filed against it a petition under the
               United States Bankruptcy Code (as now existing or in the future
               amended) or any similar state insolvency statute and Tenant's
               failure to remove such within sixty (60) days; or

          (iii) By its making an assignment of all or a substantial part of its
               property for the benefit of its creditors; or

          (iv) By its seeking or consenting to or acquiescing in the appointment
               of a receiver or a trustee for all or a substantial part of its
               property or of the leased premises or of its interest in this
               Lease; or

          (v)  By its admitting or being adjudicated a bankrupt or insolvent; or

          (vi) By the entry of any court order appointing a receiver or trustee
               for all or a substantial part of its property; approving a
               petition filed against it for a reorganization pursuant to the
               United States Bankruptcy Code or any similar state insolvency
               statute; or in any other way effecting the modification or
               alteration of the rights of creditors.

     17.2

     (a)  In the event of any default by Tenant, Landlord may, at its option,
          then or at any time thereafter while such default shall continue:

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          (i)  Terminate this Lease at once or on any later date specified in a
               notice and immediately reenter and take possession of the leased
               premises, including all improvements thereon and fixtures,
               equipment and personal property located in or about the leased
               premises;

          (ii) With or without demand or notice, and with or without legal
               process, reenter and take possession of the leased premises or
               any part thereof and repossess the same as of Landlord's former
               estate and expel Tenant, and those claiming through Tenant, and
               remove the effects of both or either (forcibly, if necessary)
               without being deemed guilty of any manner of trespass and without
               prejudice to any remedies for arrears of rentals or preceding
               breach of covenant. Should Landlord elect to reenter as provided
               herein, or should Landlord take possession pursuant to legal
               proceedings or pursuant to any notice provided by law, Landlord
               may terminate this Lease, or from time to time, without
               terminating this Lease, relet the premises or any part thereof
               for such term or terms as such rental or rentals and upon such
               terms and conditions as Landlord may deem advisable, with the
               right to make reasonable alterations and repairs to the leased
               premises. Landlord shall make reasonable efforts to relet and
               mitigate its damages. No such reentry or taking of possession of
               the premises by Landlord shall be construed as an election on
               Landlord's part to terminate this Lease unless a written notice
               of such intention be given to Tenant or unless the termination
               thereof be decreed by a court of competent jurisdiction.

     (b)  In the event Landlord terminates this Lease, Tenant shall pay the
          Rentals and other sums due prior to the time of such termination. At
          any time after such termination, Tenant shall pay to Landlord on
          demand as liquidated final damages an amount computed as the present
          value (discounted at 10%) of the difference between: (i) the Minimum
          Rent, from the date of such termination for what would be the then
          expired term of this Lease if same remained in effect; and (ii) the
          then fair net (gross rents less Landlord's expenses) rental value of
          the premises for the same period.

               If any statute or rule of law governing a proceeding in which
          such liquidated final damages are to be proved shall validly limit the
          amount thereof to

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          an amount less than the amount agreed upon hereinabove, Landlord shall
          be entitled to the maximum amount allowable under such statute or rule
          of law.

     (c)  In the event Landlord terminates Tenant's possession of the premises
          without terminating this Lease, Landlord shall receive all proceeds
          and rents accruing from any reletting of the premises and shall apply
          such proceeds to the payment of all such amounts as may be due or may
          become due under the provisions of this Lease; and the balance
          remaining after payment of reasonable costs and expenses of reletting,
          if any, at the expiration of the full term of this Lease or upon the
          sooner termination thereof shall be paid over to Tenant. If the
          amounts so received by Landlord under the provisions of this Section
          17.2 are insufficient to pay amounts due and becoming due hereunder,
          Tenant shall pay to Landlord upon demand by Landlord such deficiency
          as may from time to time exist.

     17.3 If Landlord should default or fail to perform any covenant, agreement,
undertaking or obligation imposed upon it in this Lease, and such default shall
continue for a period of thirty (30) days after service of written notice
thereof upon Landlord by Tenant, Tenant may, at its option, upon ten (10)
additional days' notice served upon Landlord, perform such covenant, agreement,
undertaking or obligation for and on behalf of Landlord, and may have and
possess and be entitled to assert all rights and remedies for such default as
may then be afforded by applicable statutory or common law to enforce the lease
terms, seek damages or both, or reduce its rental by such amount.

                            SECTION 18. CONDEMNATION

     18.1 In the event the leased premises or any part thereof shall be
condemned (which shall include any taking of public or quasi-public use under
any statute, or by right of eminent domain, or by sale under threat of eminent
domain), the interests of Landlord and Tenant in the award or consideration for
such transfer and the effect of the taking or transfer of this Lease shall be as
follows:

     (a) All damages (or settlement in lieu thereof) awarded for any such taking
     under the power of eminent domain, whether for the whole or part of the
     leased premises shall be prorated between the Landlord and the Tenant in
     the following manner. That portion of the award which is reasonably
     attributable to the land shall belong to Landlord. Landlord shall not be
     entitled to any award made to Tenant or any party claiming through Tenant
     for or

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     reasonably attributable to loss of or damage to Tenant's or the party
     claiming through Tenant's trade fixtures, and removal of personal property
     or for damages for cessation and interruption of Tenant's or the party
     claiming through Tenant's business. That portion of the award which is
     reasonably attributable to the building and improvements shall be
     apportioned between Landlord and Tenant in the following manner:

<TABLE>
<CAPTION>
YEAR OF TAKING (DURING TERM OR EXTENSION)   TENANT   LANDLORD
-----------------------------------------   ------   --------
<S>                                         <C>      <C>
                     1                       100%        0%
                     2                        95%        5%
                     3                        90%       10%
                     4                        85%       15%
                     5                        80%       20%
                     6                        75%       25%
                     7                        70%       30%
                     8                        65%       35%
                     9                        60%       40%
                    10                        55%       45%
                    11                        50%       50%
                    12                        45%       55%
                    13                        40%       60%
                    14                        35%       65%
                    15                        30%       70%
                    16                        25%       75%
                    17                        20%       80%
                    18                        15%       85%
                    19                        10%       90%
                    20                         5%       95%
</TABLE>

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     (b) If the entirety of the leased premises shall be condemned, this Lease
     shall terminate, provided, however, that such termination shall be without
     prejudice to the respective interests of Landlord and Tenant in the
     condemnation award or proceeds in lieu thereof as set forth herein.

     (c) In the event of a partial taking, or purchase of all or part of the
     leased premises or the Shopping Center in lieu of condemnation, and if
     Tenant should If the entirety of the leased premises shall he determine in
     its reasonable business judgment that it cannot carry on a satisfactory
     business because of said condemnation, then Tenant shall upon sixty (60)
     days written notice to Landlord, have the option to cancel this Lease. If,
     however, Tenant does not cancel this Lease then this Lease shall, as to the
     part taken, terminate as of the date possession of such part is taken and
     the rent shall be reduced in the same proportion that the value of the
     portion of the premises taken (less any additions to the premises by
     reconstruction) bears to the value of the total area of the premises.
     Tenant shall utilize its share or any condemnation award (as allocated
     above) solely for the repairs or alterations to the building so as to
     restore the portion of the building or other areas not taken as a complete
     architectural unit and the remaining premises as a complete merchandising
     unit. Landlord shall have no duty to make payments to Tenant for any sums
     in excess of condemnation proceeds allocated to Tenant in accordance with
     the foregoing. If repairs or alterations are required to make the Shopping
     Center (exclusive of the leased premises) a complete architectural unit,
     Landlord shall utilize its share of any condemnation award for timely
     repairs or alterations to the Shopping Center so as to restore the Shopping
     Center as a complete architectural unit and operating Shopping Center.

                 SECTION 19. ACCESS EASEMENT AND USE OF PROPERTY

     19.1 Landlord hereby grants to Tenant during the Initial Term of this Lease
and any option extension terms hereof a nonexclusive easement and license to use
without charge existing and future parking facilities, drive aisles and access
drives in and to the Shopping Center and as are arranged from time to time. Such
non-exclusive easement and license shall be for the purpose of foot and
vehicular ingress and egress, and for parking of motor vehicles of the
customers, suppliers, licensees, agents, employees and business invitees of
Tenant. Tenant shall have the right of exclusive parking for Tenant's customers
and invitees on the leased premises. Tenant may post the leased premises as
being for Tenant's exclusive parking and may tow away any

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unauthorized vehicles in such area. Landlord shall have the right to designate
from time to time Tenant's employees parking area if same is not within the
leased premises. Landlord shall at all times maintain or cause to be maintained
in good condition and repair the hard surface paving constructed on the Shopping
Center and insure that ingress and egress to the leased premises shall not be
impeded or substantially altered from the current access through the Shopping
Center drive aisles. Landlord shall not alter or close the existing entrances to
the Shopping Center nor reduce the parking areas in violation of applicable
zoning regulations.

                 SECTION 20. MECHANICS' AND MATERIALMEN'S LIENS

     20.1 Tenant covenants and agrees with Landlord that from and after the date
of execution hereof, Tenant will keep the leased premises free and clear of any
and all mechanics' and/or materialmen's liens on account of any construction,
repair, alteration or improvements which Tenant shall by virtue of the conduct
or alleged conduct of Tenant, and in the event that Tenant will cause the same
to be removed as against the leased premises, Tenant will cause the same to be
removed as against the leased premises by posting of the necessary bond or
indemnification within thirty (30) days from and after such time as said lien
shall have attached to, or be asserted upon or against the leased premises.
Tenant shall indemnify and hold harmless the Landlord from any and all losses or
expenses arising from the discharge of any such lien that shall attach to the
leased premises.

                        SECTION 21. ENVIRONMENTAL MATTERS

     21.1 Landlord and Tenant agree to the following with respect to
environmental matters.

     (a)  Landlord's Representations and Warranties. Landlord represents and
          warrants to Tenant that, to Landlord's knowledge, after due inquiry,
          (a) no Hazardous Substances, including without limitation,
          asbestos-containing materials and electrical transformers or ballasts
          containing PCBs, are present, or were installed, exposed, released or
          discharged in, on or under the leased premises at any time during or
          prior to Landlord's ownership thereof, and no prior owner or occupant
          of the leased premises has used Hazardous Substances, (b) no storage
          tanks for gasoline or any other substance are or were located on the
          leased premises at any time during or prior to Landlord's ownership
          thereof, and (c) the leased premises and the

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          improvements have been used and operated in compliance with all
          applicable local, state and federal laws, ordinances, rules,
          regulations and orders, and Landlord has all permits and
          authorizations required for the use and operation of the leased
          premises.

     (b)  Covenants. Tenant shall at all times comply with applicable local,
          state and federal laws, ordinances and regulations relating to
          Hazardous Substances. Tenant shall at its own expense maintain in
          effect any permits, licenses or other governmental approvals, if any,
          required for Tenant's use of the premises. Tenant shall make all
          disclosures required of Tenant by any such laws, ordinances and
          regulations, and shall comply with all orders, with respect to
          Tenant's use of the premises, issued by any governmental authority
          having jurisdiction over the premises and take all action required of
          such governmental authorities to bring the Tenant's activities on the
          premises into compliance with all laws, rules, regulations and
          ordinances relating to Hazardous Substances and affecting the
          premises. Landlord shall make all disclosures required of Landlord by
          any such laws, ordinances and regulations, and shall comply with all
          orders issued by any governmental authority having jurisdiction over
          the premises and take all action required of such governmental
          authorities to bring the leased premises into compliance with all
          laws, rules, regulations and ordinances relating to Hazardous
          Substances and affecting the leased premises.

     (c)  Notices. If at any time Tenant or Landlord shall become aware, or have
          reasonable cause to believe, that any Hazardous Substance has been
          released or has otherwise come to be located on or beneath the leased
          premises, such party shall, immediately upon discovering the release
          or the presence or suspected presence of the Hazardous Substance, give
          written notice of that condition to the other party. In addition, the
          party first learning of the release or presence of a Hazardous
          Substance on or beneath the premises, shall immediately notify the
          other party in writing of (i) any enforcement, cleanup, removal, or
          other governmental or regulatory action instituted, completed, or
          threatened pursuant to any Hazardous Substance laws, (ii) any claim
          made or threatened by any person against Landlord, Tenant, the
          premises and improvements arising out of or resulting from any
          Hazardous Substances, and (iii) any reports made to any local, state,
          or federal environmental agency arising out of or in connection with
          any Hazardous Substance.

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     (d)  Indemnity. Landlord shall indemnify, defend (by counsel acceptable to
          Tenant), protect, and hold harmless Tenant and each of Tenant's
          partners, directors, officers, employees, agents, attorneys,
          successors, and assigns, from and against any and all claims,
          liabilities, penalties, fines, judgments, forfeitures, losses, costs,
          or expenses (including attorney's fees, consultants' fees, and expert
          fees) for the death of or injury to any person or damage to any
          property whatsoever, arising from or caused in whole or in part,
          directly or indirectly, by (i) the presence in, on, under, or about
          the premises, the improvements or any discharge or release in or from
          the premises, the improvements of any Hazardous Substance, except to
          the extent that any such presence, discharge, or release is caused by
          Tenant's activities on the premises, or (ii) Landlord's failure to
          comply with any Hazardous Substance law unless such failure is caused
          by the activities of Tenant. Tenant shall indemnify, defend (by
          counsel acceptable to Landlord), protect, and hold harmless Landlord,
          and each of Landlord's partners, directors, officers, employees,
          agents attorneys, successors and assigns, from and against any and all
          claims, liabilities, penalties, fines, judgments, forfeitures, losses,
          costs, or expenses (including attorney's fees, consultants' fees, and
          expert fees) for the death of or injury to any person or damage to any
          property whatsoever, arising from or caused in whole or in part,
          directly or indirectly, by (i) the presence in, on, under, or about
          the premises, the improvements or any discharge or release in or from
          the premises, the improvements of any Hazardous Substance but only to
          the extent that any such presence, discharge, or release is caused by
          Tenant's activities on the premises, or (ii) Tenant's failure to
          comply with any Hazardous substance law, to the extent that compliance
          is required on account of Tenant's activities on the premises and not
          to the extent that compliance is required solely because Tenant, as
          the occupant of the premises, is held accountable for Hazardous
          Substances on, in, under, or about the leased premises, or released
          from the leased premises which are not caused by or released by
          Tenant. The indemnity obligation created hereunder shall include,
          without limitation, and whether foreseeable or unforeseeable, any and
          all costs incurred in connection with any site investigation, and any
          and all costs for repair, cleanup, detoxification or decontamination,
          or other remedial action of the premises and improvements. The
          obligations of the parties hereunder shall survive the

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<PAGE>

          expiration or earlier termination of this Lease, and any extensions
          thereof.

     21.2 Hazardous Substances. As used in this Agreement, the term "Hazardous
Substances" means any hazardous or toxic substances, materials or wastes,
including, but not limited to, those substances, materials, and wastes listed in
the United States Department of Transportation Hazardous Materials Table (49 CFR
172.101) or by the Environmental Protection Agency as hazardous substances (40
CFR Part 302) and amendments thereto, or such substances, materials and wastes
which are or become regulated under any applicable local, state or federal law.

     21.3 In the event of foreclosure or deed in lieu thereof with respect to
the Shopping Center, Tenant agrees that the representations in Section 21.1(a)
above shall in no event impose any liability whatsoever to the mortgagee or any
successful bidder at such foreclosure. Tenant shall confirm such agreement in a
non-disturbance and subordination agreement with any mortgagee of the Shopping
Center.

                            SECTION 22. MISCELLANOUES

     22.1 Landlord covenants, represents and warrants that it has full right and
power to execute and perform this Lease and to grant the estate demised herein,
and that Tenant, so long as it is not in default of the Lease, shall peaceably
and quietly have, hold and enjoy the leased premises during the full term of
this Lease and any extension or renewal thereof.

     22.2 This lease and the covenants, agreements, restrictions and conditions
herein contained shall bind, and the benefits and advantages hereof shall inure
to the respective heirs, legal representatives, successors and assigns of the
parties hereto.

     22.3 Whenever used the singular number shall include the plural, the plural
shall include the singular, and the use of any gender shall include all genders.
This instrument may be executed in counterparts, each of which shall be deemed
original, but all of which together shall constitute one and the same
instrument.

     22.4 Any notice required or permitted to be served under this Lease shall
be served by delivery in person or by placing the same in the United States
registered or certified mail, postage and costs prepaid, addressed to the other
party at the address set forth below or at such other address as such party may
designate by notice to the other in writing:

               Landlord:

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<PAGE>

          Mr. Richard H. Ashley
          President
          Conservative Development Company
          2851 Lakewood Village Drive
          North Little Rock, AR 72116

          With Copy To:

          Stuart W. Hankins, Esq.
          HANKINS, HICKS & BLAGG
          P.O. Box 5670
          North Little Rock, AR 72119

               Tenant

          Mr. Robert f. Birch, Jr.
          President
          Twin City Bank
          2925 Lakewood Village Drive
          North Little Rock, AR 72116

          Mr. Robert F. Birch, Jr.
          President
          Twin City Bank
          P.O. Box 16270
          North Little Rock, AR 72231

     22.5 Each party agrees that from time to time, upon not less than ten (10)
days prior written notice by the other party, it will deliver to the other party
a statement in writing certifying that:

     (a)  The Lease is unmodified and in full force and effect (or if there have
          been modifications, that the Lease as modified is in full force and
          effect).

     (b)  The dates to which rent and other charges have been paid.

     (c)  The other party is not in default under any provisions of the Lease or
          if in default the nature thereof in default.

     (d)  Any such other Lease information as may reasonably be requested.

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     22.6 Each party agrees that it will, upon request of the other, execute and
deliver a Memorandum of Lease in recordable form for the purpose of giving
record notice of this Lease.

     22.7 Each party covenants and warrants to the other that no broker was used
by either of them in this transaction and that no brokerage fee or commission is
due or shall accrue by virtue of this transaction and each indemnifies and holds
the other harmless from any claims arising out of the use of a broker in
connection with this transaction.

     22.8 The execution by Tenant of this Lease and the delivery of the same
shall constitute an offer, which shall automatically expire unless counterparts
of the Lease duly executed by Landlord have been delivered to Tenant on or
before ten (10) days following Tenant's execution hereof.

     22.9 For purposes of this Agreement, the "date of this Agreement" shall be
deemed to be the latter of the dates of execution of this Agreement by Landlord
and Tenant, such dates being inserted opposite the signatures of Landlord and
Tenant. Such latter date shall be inserted in the preamble on page 1 of this
Agreement.

     22.10 Notwithstanding any other provisions contained in this Lease, in the
event the Lessee is closed or taken over by the banking authority of the State
of Arkansas, or other bank supervisory authority, the Lessor may terminate this
Lease only with the concurrence of such banking authority or other bank
supervisory authority, and any such authority shall in any event have the
election either to continue or to terminate this Lease. Provided, that in the
event this Lease is terminated, the maximum claim of Lessor for damages or
indemnity for injury resulting from the rejection or abandonment of the
unexpired Term of this Lease shall in no event be in an amount exceeding the
rent reserved by this Lease, without acceleration, for the year next succeeding
the date of this surrender of the Premises to the Lessor, or the day of re-entry
of the Lessor, whichever first occurs, whether before or after the closing of
the Lessee, plus an amount equal to the unpaid rent accrued, without
acceleration up to such date.

                                        LANDLORD:

                                        CONSERVATIVE DEVELOPMENT COMPANY
                                        d/b/a LAKEWOOD VILLAGE SHOPPING PARK

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Date: 2/1/01                            By: /s/ Illegible
                                            ------------------------------------
                                        Title: President

                                        TENANT:

                                        TWIN CITY BANK

Date: 2-1-01                            By: /s/ Illegible
                                            ------------------------------------
                                        Title: President

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<PAGE>

                            (EXHIBIT "A" SITE PLAN)<PAGE>

                                                                    EXHIBIT 10.8

                                 LEASE AGREEMENT

ALLISON, ADCOCK, RANKIN, LLC            LESSOR
P.O. BOX 1735
CONWAY, ARKANSAS 72033
501-336-0050

AND

FIRST STATE BANK                        LESSEE

KNOW ALL MEN BY THESE PRESENTS:

     THAT ALLISON, ADCOCK, RANKIN, LLC, hereinafter referred to as Lessor does
hereby lease, let and rent unto FIRST STATE BANK, hereinafter called Lessee, for
considerations and terms hereinafter set out, the following described premises
located in Conway, Arkansas:

     1. DEMISED PREMISES: approximately 3300 square feet of office space with a
three car drive through canopy and one lane drive thru ATM, on the Northwest
corner of a strip commercial center currently under construction, located at the
Southwest corner of Hogan Road and Tyler Street, Conway, Arkansas. Lessor will
construct the interior of the suite per the architectural plans provided by Ken
Ingram and attached hereto as exhibit "A" and made a part hereof as if set forth
herein word for word.

     The Lessee shall be responsible for all costs associated with the purchase
and installation of the Diebold Equipment, and all banking equipment, including
computer networking, video equipment and mechanical related thereto.

     2. LEASE TERM: This Lease shall be effective for a primary term of ten (10)
years, beginning upon completion of the building, and ending ten (10) years
thereafter. The exact beginning and ending dates will be addressed in an
addendum hereto upon completion of the build out.

     3. RENT: The lessee shall pay to Lessor a monthly rental of $5,425.00 to be
paid by the first of each month. A late fee of 5% shall be assessed for any
payment that is not received by the 10th of each month. No deposit shall be
required, however, upon execution of this Lease Agreement, the lessee shall pay
$11,410.00 which shall be applied to the first and last month's rent of the
initial lease term.

          It is further agreed that a rent escalation shall be in effect during
          the term of the lease as follows:

          1.   Beginning with year four (4) the rent shall increase to $5,70000
               per month.

          2.   Beginning with year seven (7) the rent shall increase to
               $5,985.00 per month.

     4. EXTENSIONS: The Lessee shall have the right to extend this lease for two
(2) additional terms of

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five (5) years each from the expiration of the primary term hereof. Should the
Lessee choose to exercise this option, the monthly rental will increase 5% to
$6,285.00 for the first term, and 5% to $6,600.00 for the second term. The
Lessee shall give the Lessor sixty (60) days notice prior to exercising its
option.

     5. BUILDING USE: It is understood and agreed that the premises shall not be
used for any other purpose than for a banking office with drive thru without the
written consent of the Lessor. Lessee may assign this lease to other persons
only with the written approval of the Lessor. Said approval may not be
unreasonably withheld.

     6. TAXES, INSURANCE AND HOLD HARMLESS AGREEMENT: The Lessor will pay all
real estate taxes on said property during the term of this lease, and will, at
its election, keep said improvements insured against such hazards and for such
amounts as it sees fit, at its own expense.

     It is understood and agreed that lessee shall carry public liability
insurance with minimum limits of $1,000,000.00 covering the premises and the use
and occupancy of the same, including any adjoining sidewalk, with first party
named as additional insured, and shall furnish a copy of said policy to Allison,
Adcock, Rankin, LLC. Lessee shall also be responsible for insuring its personal
property within the building. The Lessor shall not be responsible for damage of
any kind to Lessee's personal property or bodily injury.

     Lessee assumes all risk of and liability for damages to persons or property
arising during the terms of the lease, in connection with the Premises, or use
thereof, and shall indemnify and hold harmless Lessor and the property of
Lessor, including the leased Premises, from any and all claims, liability, loss,
damage, or expenses resulting from any use or any other occupation and use of
the Premises by Lessee, including, but not limited to, any of such arising by
reason of the injury to or death of any person or persons or by reason of damage
to any property caused by the condition of the leased Premises, the condition of
any improvements or personal property in, on or about the leased Premises, or
the acts or omissions of the Lessee of any person in, on or about the areas with
the express or implied consent of the Lessee. Such obligation of the Lessee to
indemnify and hold harmless the Lessor and the property of the Lessor shall
include, but not be limited to, any claim, liability, loss, damage or expense
arising by reason of the injury to or death of any agent, officer or employee of
the Lessee, any independent contractor hired by the Lessee to perform work or
render services in, on, or about the Premises, or any agent, officer or employee
of any such independent contractor, and any other person from any cause
whatsoever, while in, on or about the Premises, streets, alleys, sidewalks or
public ways adjacent thereto during the term. Insurance to be provided by the
respective indemnitor as herein provided must contain a clause or endorsement
specifically

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affording covering against liability contractually assumed by the Lessee. The
indemnity herein contained is intended to be a complete indemnity against any
and all expenses, damages or loss of any kind to the Lessor, including without
limitation, attorney's fees, court costs and similar expenses incurred in
defending against any claim even if groundless.

     7. MAINTENANCE AND REPAIR: Lessor will maintain and keep in good repair,
the roof and outside of said building, including parking areas and all
landscaped areas, along with the maintenance of the HVAC unit.

     Lessee will maintain and keep in good repair, the inside of said building,
including inside lighting and plumbing, frames and moldings, glass doors, door
openers, fixtures, equipment and appurtenances thereof in good condition and
repair. All utilities shall be the responsibility of the Lessee. In addition to
maintaining the interior of the lease space, the lessee shall further insure
that the sidewalk in front of its lease space is kept in a clean, orderly, and
safe manner during the term of the lease and extensions thereof. Lessee shall
also insure that all waste and trash is disposed of in a healthy and clean
manner without disturbing the other tenants surrounding the premises.

     8. UTILITIES AND SERVICES: Lessee shall be responsible for the following:

          A.   monthly utility costs

          B.   janitorial services

          C.   nest control

          D.   pick-up and disposal of trash and garbage around exterior of
               building caused by Lessee or its customers

     9. DEFAULT: Any violation of the terms herein will be considered a default
hereunder. Should the Lessee default hereunder, the Lessor, in addition to any
and all rights provided under the laws of the State of Arkansas or equity, shall
have the right to re-enter and take possession of the premises, remove all
persons and property therefrom, and sell such property as necessary to satisfy
any deficiency hi payments by lessee as required hereunder without notice.
Further, all future rents shall be accelerated, due and payable.

     10. SIGNAGE: Any signage shall be approved by the Lessor. Maintenance of
said signage shall be the responsibility of the Lessee.

     11. MISCELLANEOUS PROVISIONS:

          a.   INVALIDITY: If any term or provision of this Lease or the
               application to any person or circumstance shall, to any extent,
               be invalid or unenforceable, the remainder of this Lease, or the
               application of such term or provision to persons whose
               circumstances other than those as to which it is held invalid or
               unenforceable, shall not be affected.

          b.   SUCCESSORS, ETC: The terms, conditions and covenants of this
               Lease shall be binding upon and shall insure to the benefit of
               each of the parties, their heirs, personal representatives,
               successors or assigns, and shall run with the land; and where
               more than one party shall be

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               lessors under this Lease, the word "Lessor" whenever used in this
               Lease shall be deemed to include all Lessors jointly and
               severally.

          c.   WRITING: No waivers, alterations or modifications of this Lease
               or any agreements in connection with this Lease shall be valid
               unless in writing duly executed by both Lessor and Lessee.

          d.   NOTICE: For purposes of contacting either party, the addresses
               shall be used:

Lessor:

     Allison, Adcock, Rankin, LLC
     Attn: Jim Rankin, Jr.
     P.O. Box 1735
     Conway, Arkansas 72033
     Phone: 501-336-0050
     Fax: 501-329-4962
     Email: jrankinjr@conwaycorp.net

Lessee:

     First State Bank
     Attn: Randy Sims
     620 Chestnut St.
     Conway, Arkansas
     Phone: 501-328-4663

     LESSOR AND LESSEE, by their execution below, indicate their consent to the
terms of this lease on this The __________ day of April, 2003.

LESSOR
ALLISON, ADCOCK, RANKIN, LLC

BY: /s/ Jim Rankin, Jr.
    ---------------------------------
    Jim Rankin, Jr., Member

LESSEE
FIRST STATE BANK

BY: /s/ Randy Sims
    ---------------------------------
    Randy Sims, President
    EIN:
         ----------------------------

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