Document:

Exhibit 10(a)(4)

                            MCB FINANCIAL CORPORATION
                          EMPLOYEE STOCK OWNERSHIP PLAN

                           Effective: January 1, 1999

                                Table of Contents
                                                                            Page
                                                                            ----

ARTICLE I - PURPOSE                                                            1
     1.1   Exclusive Benefit                                                   1
     1.2   No Rights of Employment Granted                                     1

ARTICLE II - DEFINITIONS
     2.1   Accrued Benefit                                                     2
     2.2   Administrative Committee                                            2
     2.3   Affiliated Employer                                                 2
     2.4   Beneficiary                                                         2
     2.5   Board                                                               3
     2.6   Cash-Out                                                            3
     2.7   Code                                                                3
     2.8   Compensation                                                        3
     2.9   Employee                                                            4
     2.10  Employer                                                            4
     2.11  Employer Account                                                    4
     2.12  ERISA                                                               4
     2.13  Exempt Loan                                                         4
     2.14  Fair Market Value                                                   5
     2.15  Family Member                                                       5
     2.16  Forfeiture                                                          5
     2.17  Highly Compensated Employee                                         5
     2.18  Hour of Service                                                     7
     2.19  Leave of Absence                                                    8
     2.20  Net Profits                                                         8
     2.21  Normal Retirement Age                                               9
     2.22  One Year Break in Service                                           9
     2.23  Participant                                                        10
     2.24  Plan                                                               10
     2.25  Plan Administrator                                                 10
     2.27  Qualified Election Period                                          10
     2.28  Qualified Participant                                              10
     2.29  Qualifying Employer Security                                       11
     2.30  Retirement                                                         11
     2.31  Service                                                            11
     2.32  Termination Date                                                   12
     2.33  Total and Permanent Disability                                     12
     2.34  Total Service for Vesting                                          13
<PAGE>
     2.35  Trust                                                              13
     2.36  Trust Fund                                                         13
     2.37  Unallocated Stock Account                                          13
     2.38  Year of Service for Accrual of Benefits                            13
     2.39  Year of Service for Participation                                  13
     2.40  Year of Service for Vesting                                        14

ARTICLE III - ELIGIBILITY TO PARTICIPATE                                      14
     3.1   Initial Entry                                                      14
     3.2   Resumption of Participation                                        14

ARTICLE IV - CONTRIBUTIONS TO THE TRUST                                       15
     4.1   Amount of Contributions to Participants                            15
     4.2   Manner of Allocation                                               16
     4.3   Permissible Types of Employer Contributions                        17
     4.4   Interim Allocation to Unallocated Stock Account                    17
     4.5   General Accounting                                                 18
     4.6   Additional Provisions                                              18

ARTICLE V - ADMINISTRATION OF ACCOUNTS                                        18
     5.1   Investments                                                        18
     5.2   Invest in Single Fund and Reasonable Rules                         19
     5.3   Valuation of Assets and Allocation of Changes                      19
     5.4   Limitations on Allocations to Each Participant                     20
           (a) Defined Contribution Plan Limitations                          20
           (b) Defined Benefit Plan Limitations                               21
           (c) Social Security Retirement Age Limitations                     22
           (d) Combination Defined Benefit and Defined
                 Contribution Plan Limitations                                23
           (e) Allocation Limitation - More Than One
                 Defined Contribution Plan                                    24
     5.5   Designation of Beneficiary                                         26
     5.6   Participant Voting and Exercise of Stock Rights                    26

ARTICLE VI - VESTING                                                          27
     6.1   Employer Account Vesting on Death, Retirement,
             or Total Permanent Disability                                    27
     6.2   Employer Account Vesting on Termination                            28
     6.3   Restoration of Forfeitures                                         28

ARTICLE VII - DISTRIBUTION OF BENEFITS                                        29
     7.1   Method of Distribution of Accounts                                 29
     7.2   Time of Distribution                                               30
     7.3   Segregation if Installment Distribution                            33
     7.4   Non-segregation if Installment Distribution                        33
     7.5   Distribution After Death of Participant                            33
     7.6   Distribution After Death of Beneficiary                            34
     7.7   Rollover Contributions and Distributions                           34
<PAGE>
     7.8   Suspense Account for Terminated Participants                       35
     7.9   Unable to Locate Participant or Beneficiary                        36
     7.10  Repayment of Cash-Out                                              37
     7.11  Options of Participants to Sell Stock                              37
     7.12  Right of First Refusal                                             39
     7.13  Distribution of Dividends                                          39
     7.14  Diversification of Investments                                     40
     7.15  Qualified Domestic Relations Orders                                41

ARTICLE VIII - DUTIES AND AUTHORITY OF TRUSTEE                                41
     8.1   Receive Payments                                                   41
     8.2   Evaluate Assets                                                    42
     8.3   Segregation of Accounts                                            42
     8.4   Tax Returns and Reports                                            42
     8.5   Powers                                                             42
     8.6   Expenses                                                           45
     8.7   Litigation                                                         45
     8.8   Written Instructions                                               46
     8.9   Appointment of Investment Manager                                  46
     8.10  Removal and Resignation of the Trustee                             46
     8.11  Loans from Disqualified Persons                                    46

ARTICLE IX - DUTIES AND AUTHORITY OF TRUSTEE OF
     ADMINISTRATIVE COMMITTEE                                                 48
     9.1   Appointment                                                        48
     9.2   No Discrimination                                                  49
     9.3   Majority Action                                                    49
     9.4   Powers                                                             49
     9.5   Filing Reports                                                     50
     9.6   Records and Information                                            50
     9.7   Information to Participants                                        50
     9.8   Compensation of Members                                            50
     9.9   Review of Participant's Claims                                     51
     9.10  Exercise of Stock Rights                                           51

ARTICLE X - MODIFICATIONS FOR TOP HEAVY PLANS                                 52
     10.1  Application of Article                                             52
     10.2  Definitions                                                        52
           (a) Top Heavy Plans                                                52
           (b) Top Heavy Group                                                52
           (c) Key Employee                                                   53
           (d) Amounts Included for Computation Purposes                      54
           (e) Non-Key Employee                                               54
           (f) Top Heavy Accrual                                              55
     10.3  Accelerated Vesting                                                55
     10.4  Minimum Contributions                                              56
     10.5  Limitation on Compensation Taken into Account Under Plan           57
     10.6  Modification of Defined Benefit and Defined Contribution
             Plan Fraction                                                    57
<PAGE>
ARTICLE XI - AMENDMENT AND TERMINATION                                        58
     11.1  Rights to Suspend or Terminate Plan                                58
     11.2  Successor Corporation                                              58
     11.3  Amendment                                                          58
     11.4  One Hundred Percent (100%) Vesting on Termination of Plan          59
     11.5  Plan Merger or Consolidation                                       59

ARTICLE XII - MISCELLANEOUS                                                   59
     12.1  Laws of California to Apply                                        59
     12.2  Participant Cannot Transfer or Assign Benefits                     60
     12.3  Right to Perform Alternative Acts                                  60
     12.4  Reversion of Contributions Under Certain Circumstances             60
     12.5  Plan Administrator Agent for Service of Process                    61
     12.6  Filing Tax Returns and Reports                                     61
     12.7  Indemnification                                                    61
     12.8  Number and Gender                                                  62
     12.9  Military Service                                                   62

ARTICLE XIII - EXEMPT LOANS                                                   63
     13.1  Use of Proceeds                                                    63
     13.2  Interest Rate                                                      63
     13.3  Non-recourse                                                       63
     13.4  Limitations on Payment                                             64
     13.5  Forfeiture of Qualifying Employer Securities                       64
     13.6  Limitation on Future Obligation                                    64

ARTICLE XIV - LIMITATIONS ON MATCHING CONTRIBUTIONS                           65
     14.1  Percentage Limitation on Matching Contributions                    65
     14.2  Basic Limitation                                                   67
     14.3  Alternative Limitation                                             67
     14.4  Multiple Use Limitation                                            68
     14.5  Correction of Average Contribution Percentage Test                 69
     14.6  Calculation of Income                                              69
     14.7  Deadline for Distribution                                          70
     14.8  Treatment as Annual Additions                                      70
     14.9  Compliance with Treasury Regulations                               70
<PAGE>
                            MCB FINANCIAL CORPORATION
                          EMPLOYEE STOCK OWNERSHIP PLAN

This Stock Bonus Employee Stock  Ownership  Plan and Trust  Agreement  (Plan) is
made by and between MCB Financial Corporation a California  corporation,  having
its  principal  place of business at 1248 Fifth Avenue,  San Rafael,  California
94901, herein called "Employer" and Charles 0. Hall, Timothy J. Jorstad and Gary
T. Ragghianti, herein called "Trustees."

Whereas,  Employer desires to establish and maintain an employee stock ownership
plan  for the  benefit  of its  Employees  who  shall  qualify  as  participants
(Participants) hereunder;

Therefore,  effective January 1, 1999,  Employer hereby  establishes an employee
stock  ownership  plan and  creates a related  trust  (Trust) for the purpose of
carrying out such Plan and Trust on the following terms:

                               ARTICLE I - PURPOSE

1.1 Exclusive Benefit.

This  Plan has been  executed  for the  exclusive  benefit  of the  Participants
hereunder and their  Beneficiaries.  This Plan shall be  interpreted in a manner
consistent  with this intent and with the  intention of the  Employer  that this
Plan and its related Trust satisfy  Internal Revenue Code (Code) Section 401 and
Code  Section  501.  This  Plan is  created  for the sole  purpose  of  enabling
employees  of the  Employer  to share in its  growth.  This  Plan and  Trust are
intended to constitute a stock bonus employee stock ownership  plan,  within the
meaning of Code  Section  4975(e)(7),  which will invest  primarily  in Employer
stock. Under no circumstances  shall the Trust Fund ever revert to or be used or
enjoyed by the Employer,  except as provided in the  Reversion of  Contributions
Under Certain Circumstances section below.

1.2 No Rights of Employment Granted.

The  establishment  of this Plan shall not be  considered as giving any employee
the right to be retained in the service of the Employer.

                            ARTICLE II - DEFINITIONS

The  following  capitalized  words  and  phrases  as used in this Plan and Trust
Document shall have the meanings set forth below.

2.1 Accrued Benefit.

The  "Accrued  Benefit"  is the amount  credited  to the  Employer  Account of a
Participant.

2.2 Administrative Committee.

The "Administrative  Committee" or "Committee" shall refer to the Administrative
Committee,  as defined in the Duties and Authority of  Administrative  Committee
Article, below.

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<PAGE>
2.3 Affiliated Employer.

"Affiliated  Employer"  shall mean the Employer and any  corporation  which is a
member of a controlled group of corporations (as defined in Code Section 414(b))
which includes the Employer; any trade or business (whether or not incorporated)
which is under  common  control (as  defined in Code  Section  414(c))  with the
Employer;  an organization (whether or not incorporated) which is a member of an
affiliated  service group (as defined in Code Section 414(m)) which includes the
Employer;  and any other  entity  required to be  aggregated  with the  Employer
pursuant to regulations under Code Section 414(o).

2.4 Beneficiary.

A "Beneficiary" is any person, estate or trust who by operation of law, or under
the terms of the Plan, or otherwise,  is entitled to receive any Accrued Benefit
of a Participant  under the Plan. A "Designated  Beneficiary"  is any individual
designated  or  determined in accordance  with the  Designation  of  Beneficiary
section  below,  except  that it shall not  include  any  person  who  becomes a
Beneficiary by virtue of the laws of inheritance or intestate succession.

2.5 Board.

"Board" or "Board of Directors"  shall mean the governing board of MCB Financial
Corporation.

2.6 Cash-Out.

A "Cash-Out" may be involuntary or voluntary.

An  involuntary  Cash-Out  is a  distribution  of  Accrued  Benefit  to a former
Participant which meets the following requirements: (i) the former Participant's
entire  non-forfeitable  Accrued Benefit is distributed to him; (ii) the present
value of the  non-forfeitable  Accrued Benefit of the Participant at the time of
distribution  does not exceed Five  Thousand  Dollars  ($5,000),  regardless  of
whether it had exceed Five  Thousand  Dollars  ($5,000) at any time in the past,
and (iii) the  distribution is made on account of the Employee's  termination of
participation in the Plan.

A  voluntary  Cash-Out  is a  distribution  of  Accrued  Benefits  to  a  former
Participant which meets the following  requirements:  (i) the former Participant
has voluntarily  elected to receive the distribution;  and (ii) the distribution
is made on account of the Employee's termination of participation in the Plan.

2.7 Code.

"Code" refers to the Internal Revenue Code of 1986, as amended.

2.8 Compensation.

"Compensation"  refers to all  Compensation  paid  during  the Plan  Year  under
consideration as W-2 income by the Employer to an Employee, excluding director's
fees and amounts deferred  pursuant to Code Section  401(k)(2),  or Code Section
403(b),  or contributed to any welfare benefit plans  maintained by the Employer
through a  reduction  in the  Employee's  compensation  which,  pursuant to Code
Section  125,  are not  included  in the gross  income of the  Employee  for the
taxable   year  in  which  such  amounts  are   contributed.   It  excludes  all
contributions  by the  Employer  to the  Plan  and to any  other  retirement  or
deferred  compensation  plan maintained by the Employer and excludes  amounts in

                                       2
<PAGE>
excess of One Hundred Fifty  Thousand  Dollars  ($150,000)  for the Plan Year or
such other amount as may be prescribed  by law in  accordance  with Code Section
401(a)(17).

2.9 Employee.

An "Employee"  is an  individual  who is employed by the Employer or who is on a
Leave of Absence,  and shall include leased Employees within the meaning of Code
Section  414(n)(2).  Directors  acting solely in that  capacity and  independent
contractors shall not be Employees.

2.10 Employer.

The "Employer" shall mean MCB Financial  Corporation and any Affiliated Employer
to which the Board elects to extend  coverage under this Plan and Trust pursuant
to resolutions of the Board.

2.11 Employer Account.

The "Employer  Account" is the separate account  maintained for each Participant
to which all Employer  contributions shall be allocated and to which Forfeitures
shall be reallocated. If necessary or appropriate, the Employer Account shall be
further  segregated  into  subaccounts  for  Employer  basic  contributions  and
Employer matching contributions.

2.12 ERISA.

"ERISA"  refers to the  Employee  Retirement  Income  Security  Act of 1974,  as
amended.

2.13 Exempt Loan.

"Exempt Loan" shall mean a loan to the Plan by a disqualified person (as defined
in Code  Section  4975(e)(2))  or a loan to the Plan  which is  guaranteed  by a
disqualified  person. Such loan includes a direct loan of cash, a purchase-money
transaction,  and an assumption of the  obligation by the Plan.  The Exempt Loan
must satisfy the provisions of Treasury Regulation Section 54.4975-7(b).

2.14 Fair Market Value.

"Fair  Market  Value"  shall mean the closing  price (or, if there is no closing
price, then the closing bid price) of Qualifying Employer Securities as reported
on the Composite Tape, or if not reported  thereon,  then such price as reported
in the trading reports of the principal securities exchange in the United States
on which such Qualifying  Employer  Securities are listed,  or if the Qualifying
Employer  Securities  are not  listed on a  securities  exchange  in the  United
States,  the mean  between  the  dealer  closing  "bid" and "ask"  prices on the
over-the-counter  market as reported by the National  Association  of Securities
Dealers Automated Quotation System (NASDAQ),  or NASDAQ's  successor,  or if not
reported on NASDAQ, the Fair Market Value of the Qualifying  Employer Securities
as determined by a qualified  independent appraiser meeting requirements similar
to those  contained in Treasury  regulations  under Code Section  170(a)(1)  and
Department of Labor Regulations under ERISA Section 3(18).

                                       3
<PAGE>
2.15 Family Member.

A "Family Member" includes the spouse,  lineal ascendants and descendants of the
Employee  or former  Employee  and the  spouses of such  lineal  ascendants  and
descendants.

2.16 Forfeiture.

"Forfeiture"   refers  to  the  amount  of  non-vested  Accrued  Benefits  in  a
Participant's Employer Account which are reallocated to the Employer Accounts of
other Participants.

2.17 Highly Compensated Employee.

A "Highly Compensated Employee" means a highly compensated active Employee and a
highly compensated former Employee.

A highly  compensated  active  Employee for a  determination  year  includes any
Employee who performs service for the Employer during the determination year and
who: (i) was a five percent (5%) owner (as defined in Code Section 416(i)(1)) of
the Employer at any time during the determination year or the look-back year, or
(ii) for the  look-back  year had  compensation  from the  Employer in excess of
Eighty Thousand Dollars  ($80,000) (as adjusted pursuant to Code Section 415(d))
and, if the Employer  elects for such look-back  year, was in the top-paid group
of Employees for the look-back year.

An Employee is in the top-paid  group of Employees for any year if such Employee
is in the group consisting of the top twenty percent (20%) of the Employees when
ranked on the basis of compensation (as defined in Code Section  414(q)(4)) paid
during such year.  For  purposes of  determining  the number of Employees in the
top-paid group,  the following  Employees  shall be excluded:  (i) Employees who
have not completed six (6) months of service;  (ii)  Employees who normally work
less than  seventeen  and one-half  (17.5) hours per week;  (iii)  Employees who
normally work during not more than six (6) months during any year; (iv)Employees
who have not attained age twenty-one (21); and (v) except to the extent provided
in Treasury  Regulations,  Employees  who are  included  in a unit of  Employees
covered by an  agreement  which the  Secretary of Labor finds to be a collective
bargaining agreement between employee representatives and the Employer.

For this  purpose,  the  determination  year  shall be the Plan Year  unless the
Employer  elects a calendar  year.  The look-back  year shall be the twelve (12)
month period immediately preceding the determination year, or, if elected by the
Employer,  the calendar year ending with or within the applicable  determination
year (or, in the case of a  determination  year that is shorter than twelve (12)
months,  the  calendar  year ending with or within the twelve (12) month  period
ending with the end of the applicable  determination  year), or, if elected, the
calendar year immediately preceding the calendar year determination year.

A highly  compensated  former Employee for a Plan Year includes any Employee who
separated  from  service  (or was deemed to have  separated)  prior to such Plan
Year,  performs no services  for the Employer  during such Plan Year,  and was a
highly  compensated  active  Employee  for either the Plan Year during which the
separation  occurred (or was deemed to have occurred) or any Plan Year ending on
or after the Employee's fifty-fifth (55th) birthday.

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<PAGE>
The  determination  of who  is a  Highly  Compensated  Employee,  including  the
determinations of the number and identity of Employees in the top-paid group and
the  compensation  that is  considered,  will be made in  accordance  with  Code
Section 414(q) and the regulations promulgated thereunder.

2.18 Hour of Service.

"Hour of Service" means:

          (a) Each  hour  for  which  an  Employee  is  directly  or  indirectly
     compensated  or  entitled  to  Compensation   from  the  Employer  for  the
     performance of duties during the applicable computation period;

          (b) Each  hour  for  which  an  Employee  is  directly  or  indirectly
     compensated or entitled to Compensation from the  Employer(irrespective  of
     whether the employment  relationship has terminated) for reasons other than
     performance of duties (such as vacation,  holidays,  sickness,  disability,
     lay-off,   military  duty  or  leave  of  absence)  during  the  applicable
     computation period; and

          (c) Each  hour for  which  back pay is  awarded  or  agreed  to by the
     Employer, without regard to mitigation of damages.

Hours of Service  will be  credited  for  employment  with  other  members of an
affiliated  service  group (under Code Section  414(m)),  a controlled  group of
corporations  (under Code Section  414(b)),  or a group of trades or  businesses
under  common  control  (under Code  Section  414(c)) of which the Employer is a
member or any other entity required to be aggregated with the Employer  pursuant
to regulations under Code Section 414(o).

Hours of Service will also be credited for any individual considered an Employee
for purposes of this Plan under Code Section 414(n).

Notwithstanding  subparagraph  (b) above,  no more than five  hundred  one (501)
Hours of Service  are  required  to be credited to an Employee on account of any
single  continuous  period during which the Employee performs no duties (whether
or not such period occurs in a single computation period), and an hour for which
an Employee is directly or indirectly  paid, or entitled to payment,  on account
of a period  during which no duties are performed is not required to be credited
to the  Employee if such payment is made or due under a Plan  maintained  by the
Employer  solely  for  the  purpose  of  complying  with   applicable   worker's
compensation,   unemployment  compensation  or  disability  insurance  laws.  In
addition,  Hours of Service  are not  required to be  credited  hereunder  for a
payment  which solely  reimburses  an Employee for medical or medically  related
expenses incurred by the Employee. The provisions of Sections 2530.200b-2(b) and
(c) of the Department of Labor Regulations are incorporated herein by reference.

For purposes of this Hour of Service  section,  a payment  shall be deemed to be
made by or due from the Employer  regardless  of whether such payment is made by
or due from the Employer directly or indirectly through a trust, fund or insurer
to which the Employer contributes or pays premiums.

                                       5
<PAGE>
2.19 Leave of Absence.

A "Leave of Absence" shall refer to that period during which the Participant is
absent without Compensation and for which the Administrative  Committee,  in its
sole  discretion,  has determined  him to be on a "Leave of Absence"  instead of
having   terminated   his   employment.   (However,   such   discretion  of  the
Administrative  Committee shall be exercised in a nondiscriminatory  manner.) In
all events,  a Leave of Absence by reason of service in the armed  forces of the
United  States  shall  end no  later  than  the  time at  which a  Participant's
reemployment rights as a member of the armed forces cease to be protected by law
and a Leave of  Absence  for any other  reason  shall end after six (6)  months,
except  that if the  Participant  resumes  employment  with the  Employer  prior
thereto,  the  Leave  of  Absence  shall  end on  such  date  of  resumption  of
employment.  The date  that the  Leave  of  Absence  ends  shall be  deemed  the
Termination  Date  if the  Participant  does  not  resume  employment  with  the
Employer.  In  determining  a Year of Service for Accrual of Benefits,  all such
Leaves of Absence  shall be  considered  to be periods  when the  Employee  is a
Participant.

2.20 Net Profits.

The "Net  Profits" mean the  Employer's  Net Profits for the taxable year of the
Employer  (coinciding  with or within which the plan year ends) as calculated at
the  end  of the  taxable  year,  in  accordance  with  the  Employer's  regular
accounting  practices,  before  state  and  federal  income  taxes  and  without
reduction by reason of the Employer's contributions under the Plan and any other
Plan  maintained  by the  Employer  and  described  in Code  Section 401 (a) and
Section 403 (a).

The "Net Profits" shall also mean the Employer's accumulated Net Profits for all
years prior to the taxable  year of the  Employer,  described  in the  preceding
paragraph of this section.  Such  accumulated Net Profits shall be calculated in
accordance with the Employer's  regular accounting  practices,  before state and
federal  income taxes which would be refunded (as a result of  contributions  to
the Plan), without reduction by reason of the Employer's contributions, made for
the  current  Plan  Year,  under the Plan and any other Plan  maintained  by the
Employer and described in Code Section 401 (a) or Section 403(a).

2.21 Normal Retirement Age.

The "Normal  Retirement  Age" is attained on or next following the later of: (a)
the date a  Participant  attains  age  sixty-five  (65);  or (b) the fifth (5th)
anniversary of the Participant's becoming a Participant in the Plan.

2.22 One Year Break in Service.

A "One Year Break in Service" means a Plan Year in which the Participant has not
completed more than five hundred (500) Hours of Service.

However, in determining a One Year Break in Service for a Plan Year in which, or
following which, a maternity or paternity absence (as defined below) occurs, the
following  shall  apply:  the Hours of Service  which  normally  would have been
credited  but for the  maternity  or  paternity  absence  (or eight (8) Hours of
Service per day if the Administrative Committee is unable to determine the Hours
of Service which  normally  would have been  credited)  shall be credited to the
Plan Year in which such absence  begins,  if the Employee would incur a One Year
Break in Service if the hours were not so credited; in all other cases the Hours
of Service  shall be credited  to the  following  Plan Year.  The total Hours of
Service  credited  under a maternity or paternity  absence shall not exceed five
hundred one (501) hours. A "maternity or paternity  absence" is one in which the
Employee is absent from work because of: (i) the pregnancy of the Employee, (ii)
the birth of a child of the  Employee,  (iii) the  placement of a child with the
Employee in connection with the adoption of such child by the Employee,  or (iv)
the caring for such child immediately following such birth or placement.

                                       6
<PAGE>
As a condition of an Employee being  credited with Hours of Service  pursuant to
this  paragraph,  the  Administrative  Committee  can require  that the Employee
timely furnish such information as is reasonably necessary to establish that the
absence  from work was for a cause  stated  in  subparagraphs  (i)-(iv)  and the
number of days attributable to such cause.

2.23 Participant.

A "Participant" shall refer to every Employee or former Employee who has met the
applicable participation requirements of Article III.

2.24 Plan.

"Plan"  refers to this  Stock  Bonus  Employee  Stock  Ownership  Plan and Trust
Agreement,  which shall be known as the MCB Financial Corporation Employee Stock
Ownership Plan.

2.25 Plan Administrator.

The "Plan Administrator"  shall be the Administrative  Committee designated in a
resolution adopted by the Board of Directors,  pursuant to Article IX, who shall
accept the designation in writing.

2.26 Plan Year.

A "Plan  Year" is the  period  from the first day of  January to the last day of
December, annually.

2.27 Qualified Election Period.

"Qualified  Election  Period"  shall  mean  the  period  of six (6)  Plan  Years
beginning  with the later of (i) the Plan Year  after the Plan Year in which the
Participant  attains age fifty-five  (55); or, (ii) the Plan Year after the Plan
Year in which the Participant first becomes a Qualified Participant.

2.28 Qualified Participant.

"Qualified Participant" shall mean a Participant who has attained age fifty-five
(55) and who has completed at least ten (10) years of participation in the Plan.

2.29 Qualifying Employer Security.

"Qualifying  Employer  Security"  shall mean Common Stock of the Employer  which
meets the requirements of Code Section 409(1).

2.30 Retirement.

"Retirement"  refers to the  termination  of  employment  of an Employee who has
attained at least the Normal Retirement Age. The Employee may work beyond Normal
Retirement  Age, in which case  Employer  contributions  and  Forfeitures  shall
continue to be allocated to the Employer Account of the Employee.

                                       7
<PAGE>
2.31 Service.

"Service" means:

          (a) The period  (measured  in years and days) for which an Employee is
     directly or indirectly  compensated  or entitled to  Compensation  from the
     Employer for the  performance of duties during the  applicable  computation
     period;

          (b) The  period  for  which an  Employee  is  directly  or  indirectly
     compensated or entitled to Compensation from the Employer  (irrespective of
     whether the employment  relationship has terminated) for reasons other than
     performance of duties (such as vacation,  holidays,  sickness,  disability,
     lay-off,   military  duty  or  leave  of  absence)  during  the  applicable
     computation period; and

          (c) Each  period  after the  effective  date of this Plan for which an
     Employee  was  directly  or  indirectly  paid or entitled to be paid by the
     Employer.

Service  will be credited for  employment  with other  members of an  affiliated
service group (under Code Section  414(m)),  a controlled  group of corporations
(under Code Section  414(b)),  or a group of trades or  businesses  under common
control  (under Code  Section  414(c)) of which the  Employer is a member or any
other entity required to be aggregated with the Employer pursuant to regulations
under Code Section 414(o) for the period of such  affiliation or common control.
Service  with a  predecessor  employer,  however,  will  not be  recognized  for
purposes of eligibility, vesting or benefit accrual unless specifically required
by the Code or ERISA or unless the Plan is  amended by the Board to provide  for
such recognition.

Notwithstanding  subparagraph  (b),  above,  no more than five hundred one (501)
Hours of Service is  required  to be  credited  to an Employee on account of any
single  continuous  period during which the Employee performs no duties (whether
or not such  period  occurs in a single  computation  period),  and for which an
Employee is directly or indirectly paid, or entitled to payment, if such payment
is made or due under a plan maintained by the Employer solely for the purpose of
complying with applicable worker's  compensation,  unemployment  compensation or
disability insurance laws. The provisions of Sections  2530.200b-2(b) and (c) of
the Department of Labor Regulations are incorporated herein by reference.

2.32 Termination Date.

The "Termination  Date" shall be the date on which the earliest of the following
events occurs:

     (a)  A Participant's Retirement,

     (b)  A  Participant's  termination  of  employment as a result of total and
          permanent disability;

     (c)  A Participant's death, or

     (d)  A Participant's termination of employment for any other reason.

                                       8
<PAGE>
2.33 Total and Permanent Disability.

"Total and Permanent Disability" shall refer to the Participant suffering from a
physical or mental condition which,  based upon appropriate  medical reports and
examinations,  results  in the  inability  to perform  his usual  duties for the
Employer  resulting  in  termination  of service  with the  Employer,  and which
qualifies as Total and Permanent  Disability  under the federal Social  Security
Act.

2.34 Total Service for Vesting.

"Total  Service for Vesting" shall mean the sum of each separate Year of Service
for Vesting credited to the Participant;  however,  if the Participant incurs at
least five (5) consecutive One Year Breaks in Service,  his Years of Service for
Vesting  rendered after such break in service shall only be counted for purposes
of determining his vested benefits accruing after such break in service, not for
determining his -vested benefits accruing before such break.

2.35 Trust.

"Trust" means the Trust created under this  Employee  Stock  Ownership  Plan and
Trust Agreement.

2.36 Trust Fund.

The "Trust Fund" consists of the Employer contributions held by the Plan and any
income or appreciation thereon.

2.37 Unallocated Stock Account.

The Account  used to hold  Qualifying  Employer  Securities  acquired  with loan
proceeds pursuant to the "Loans from Disqualified Persons" section below.

2.38 Year of Service for Accrual of Benefits.

A "Year of Service for Accrual of  Benefits"  means a Plan Year during which the
Employee  had  not  less  than  one  thousand  (1,000)  Hours  of  Service  as a
Participant.  If the Participant  entered the Plan other than on the first (1st)
day of the Plan Year, all Hours of Service  rendered by the  Participant  during
that Plan Year, whether or not rendered as a Participant, shall be treated as if
they were Hours of Service as a Participant.

2.39 Year of Service for Participation.

A "Year of Service for  Participation"  means the Plan Year which  includes  the
Employees date of hire provided the Employee was credited with not less than one
thousand  (1,000)  Hours of Service  during such Plan Year. If the Employee does
not have one  thousand  (1,000)  Hours of Service for such Plan Year,  a Year of
Service for Participation  shall be the earliest Plan Year in which the Employee
is credited with one thousand (1,000) Hours of Service.

                                       9
<PAGE>
In  case  the  Employee   completes  at  least  one  (1)  Year  of  Service  for
Participation  and  then has at least a One  Year  Break in  Service,  a Year of
Service for  Participation  following  such break in service  shall begin on the
first day  following  the One Year  Break in  Service  on which  his  employment
resumes.  If the Employee does not perform one thousand (1,000) Hours of Service
during  the  Plan  Year  which   includes  such  day,  a  Year  of  Service  for
Participation  shall be the  earliest  Plan Year in which the  Employee  has one
thousand (1,000) Hours of Service.

2.40 Year of Service for Vesting.

A "Year of Service for Vesting" shall mean a Plan Year, after the effective date
of this Plan,  during which the Employee had not less than one thousand  (1,000)
Hours of Service after attaining age eighteen (18).

                    ARTICLE III - ELIGIBILITY TO PARTICIPATE

3.1 Initial Entry.

Every Employee who has attained the age of twenty-one (21) and completed one (1)
Year of Service for  Participation  shall  participate  in the Plan on the first
(1st) day of the Plan Year in which such  eligibility  requirements are met. All
Participants shall be required to furnish such information to the Administrative
Committee  as it may  reasonably  request for the proper  administration  of the
Plan.  Service  with  a  predecessor   employer  shall  not  be  recognized  for
eligibility or determining an Employee's Plan entry date.

3.2 Resumption of Participation.

A Participant  who is reemployed by the Employer  without having  incurred a One
Year Break in Service  shall be a  Participant  as of the first (1st) day of the
month following the date of his  reemployment.  If an Employee incurs at least a
One  Year  Break in  Service,  his  active  participation  in the Plan  shall be
suspended until he completes a Year of Service for Participation  following such
One Year Break in Service.

Upon completing a Year of Service for Participation after such One Year Break in
Service, measured from his re-employment commencement date, the Participant will
be  readmitted  to active  participation  in the Plan as of the first day of the
Plan  Year  in  which  the  Participant  completes  such  Year  of  Service  for
Participation.

The Committee may adjust the above service  requirement,  as necessary,  to make
the  Plan  available  to a  newly-acquired  Employee  group,  provided  that the
adjustment (1) is not more restrictive than the above requirement,  and (2) does
not discriminate in favor of Highly Compensated Employees.

                     ARTICLE IV - CONTRIBUTIONS TO THE TRUST

4.1 Amount of Contributions to Participants.

Subject to the rights of the Employer  under Article XI, and the  limitations of
Article  XIV  on  Employer  matching   contributions,   the  Employer  may  make
discretionary  contributions  to the Trust  beginning  with the first  Plan Year
ending  on or  after  the  effective  date  of  the  Plan.  The  amount  of  all
contributions  shall be discretionary with the Employer and shall be paid to the
Trustee on or before the time required by law for filing the Employer's  federal
income tax return (including  extensions) for the year with respect to which the
contribution is made. However, no Employer contributions may be made in any Plan
Year to the extent that they would be directly allocated to the suspense account
created  pursuant to the Limitation on Allocations to Each  Participant  section

                                       10
<PAGE>
below, or the maximum amount  deductible  from  Employer's  income for such year
under Code  section  404(a)(3)  or  404(a)(9)  would be  exceeded,  whichever is
applicable,  unless such excess contribution is necessary to make payments on an
Exempt Loan.  Notwithstanding any other provision contained herein, the Employer
shall  make a  contribution  each  year in an amount  not less  than the  amount
required to make any payment due during such year under any Exempt Loan.

Discretionary Employer contributions shall include:

          (a)  Discretionary  basic  contributions in an amount decided upon and
     fixed (in dollar  amount or by  formula) by  Employer  and  declared to all
     Participants,

          (b) Discretionary matching contributions in an amount decided upon and
     fixed (in dollar  amount or by  formula) by  Employer  and  declared to all
     Participants  who are  making  elective  contributions  under  any  cash or
     deferred  arrangement (within the meaning of Code section 401(k)) sponsored
     by the employer, and

          (c) Such other discretionary  contributions as the Employer shall deem
     necessary to comply with the Contribution  Percentage  requirements of Code
     section  401(m)(2)  for a Plan Year.  The Employer may designate all or any
     part of a  discretionary  contribution  as a  contribution  to the matching
     contribution portion of the Plan that shall be used for Code section 401(m)
     purposes. Any discretionary  contributions  designated as a contribution to
     the  matching   contribution   portion  of  the  Plan  shall   satisfy  the
     requirements for qualified  nonelective  contributions  treated as matching
     contributions under Code section 401(m)(4)(C).  Such contributions shall be
     allocated  as of the last day of that Plan Year to any or all  Participants
     on that date, other than Participants who are Highly Compensated Employees,
     in  accordance  with the average of their  respective  Actual  Contribution
     Percentage for that Plan Year.

4.2 Manner of Allocation.

          (a) All discretionary basic contributions by the Employer for any Plan
     Year,  reduced by Forfeitures,  of such  contributions  if any, during such
     year,  shall be  allocated  as of the last day of such year to the Employer
     Account of each individual Participant,  who is an Employee on the last day
     of such Plan Year,  and who has a Year of Service  for  Accrual of Benefits
     for the Plan  Year,  in the same  proportion  that each such  Participant's
     Compensation  for the Plan  Year  bears to the  total  Compensation  of all
     Participants for the Plan Year.  Employees who terminate  employment before
     the last day of the  Plan  Year on  account  of death or  Retirement  shall
     receive an  allocation  regardless  only if they have a Year of Service for
     Accrual of Benefits for such Plan Year.  Employees who terminate employment
     before  the last day of the Plan Year on  account  of Total  and  Permanent
     Disability  shall receive an allocation only if they have a Year of Service
     for Accrual of Benefits for such Plan Year.

          (b) All discretionary  matching  contributions by the Employer for any
     Plan Year,  reduced by Forfeitures of such  contributions,  if any,  during
     such  year,  shall be  allocated  as of the  last  day of such  year to the
     Employer Account of each individual Participant in the same proportion that
     each such Participant's  elective deferral  contributions for the Plan Year

                                       11
<PAGE>
     to the cash or deferred  arrangement  maintained by the Employer,  bears to
     the total elective deferral  contributions for the Plan Year to the cash or
     deferred   arrangement   maintained  by  the  Employer  made  by  all  such
     Participants.

          (c) If allocation of Employer contributions in accordance with section
     (a) above will result in an allocation of more than one-third  (1/3) of the
     total  contributions for a Plan Year to the accounts of Highly  Compensated
     Employees,  then  such  amounts  may be  reallocated  so  that  it  will be
     allocated to the  Participants  who are not Highly  Compensated  Employees.
     Notwithstanding  anything  to the  contrary  contained  in this  Manner  of
     Allocation  section,  no Qualifying Employer Securities may be allocated to
     the Employer  Account of any Participant who sold such Qualifying  Employer
     Securities  to the Plan,  any  person who is a member of the family of such
     person  (within the meaning of Code section  267(c)(4)),  or any person who
     owns  more  than  twenty-five  percent  (25%)  in  value  of any  class  of
     outstanding  Qualifying  Employer Securities (after the application of Code
     section 318(a)).

4.3 Permissible Types of Employer Contributions.

Payments on account of the  contributions due from the Employer for any year may
be  made  in  cash  or  in  kind,  specifically  including  Qualifying  Employer
Securities;  except  that  assets may not be  contributed  if such  contribution
violates  the  prohibited  transaction  rules  of  Code  Section  4975,  or  the
corresponding rules under ERISA Section 406, if applicable.

4.4 Interim Allocation to Unallocated Stock Account.

Qualifying  Employer  Securities  purchased  with an Exempt Loan when  initially
acquired by the Trustees shall be credited to the Unallocated Stock Account. The
balance in the  Unallocated  Stock Account shall be released in accordance  with
Section  8.11  and the  Qualifying  Employer  Securities  so  released  shall be
allocated  as of the last day of each Plan  Year in  accordance  with  Manner of
Allocation section above.

4.5 General Accounting.

The Committee  shall establish  accounting  procedures for the purpose of making
the allocations to Participant's  Accounts  provided for in this Article IV. The
Committee  shall  maintain  adequate  records  of the  aggregate  cost  basis of
Qualifying Employer Securities allocated to each Participant's Employer Account.
The  Committee  shall  also  keep  separate   records  of  financed  shares  and
discretionary  contributions  (and any earnings thereon) made for the purpose of
enabling the Trust to repay any Exempt Loan.  From time to time,  the  Committee
may modify the accounting procedures for the purposes of achieving equitable and
nondiscriminatory  allocations  among the accounts of Participants in accordance
with the general concepts of the Plan, the provisions of this Article IV and the
requirements of the Code and ERISA.

4.6 Additional Provisions.

Employer  contributions  shall  not be made for any Plan Year in  amounts  which
cannot be  allocated  to  Participant's  accounts  by  reason of the  allocation
limitations  described in Article V or in amounts which are not deductible under
Code Section 404(a). Any Employer  Contributions  which are not deductible under
Code Section  404(a) may be returned to the  Employer by the Trustees  (upon the
direction of the  Employer)  within one (1) year after the  disallowance  of the
deduction or after it is determined that the deduction is not available.  In the
event that Employer  Contributions  are paid to the Trust by reason of a mistake
of fact,  such  Employer  Contributions  may be returned to the  Employer by the
Trustees  (upon the  direction  of the  Employer)  within one (1) year after the
payment to the Trust.

                                       12
<PAGE>
                     ARTICLE V - ADMINISTRATION OF ACCOUNTS

5.1 Investments.

The amounts allocated to the Employer Accounts shall be invested by the Trustees
as directed in accordance  with Article VIII,  primarily in Qualifying  Employer
Securities.

5.2 Invest in Single Fund and Reasonable Rules.

The  Trustees  may cause all  contributions  paid to it by the  Employer and the
income therefrom,  without  distinction between principal and income, to be held
and  administered  as a single fund,  and the Trustees  shall not be required to
invest  separately  any  share of any  Participant  except  as  provided  in the
Non-segregation  if Installment  Distribution  section  below.  The Trustees may
adopt  reasonable rules for the  administration  of such common fund and for the
determination of the proportionate interest of each Participant in the fund.

5.3 Valuation of Assets and Allocation of Changes.

The  assets of the Trust  Fund will be valued as of the close of the last day of
each Plan Year at their Fair  Market  Value in  accordance  with the Fair Market
Value  definition in Article II and the Employer Account of each Participant (or
Employer  Accounts if the Participant has Accrued  Benefits for service incurred
both  prior  and  subsequent  to a One Year  Break in  Service),  including  any
Employer Account held in suspense, shall be adjusted for any net appreciation or
net depreciation in the assets of the Plan and any net income or net loss of the
Trust for such year,  with each account  being  credited or charged in the ratio
that the  amount  of the  account  (as of the  close of the last day of the Plan
Year)  bears to the total (as of the close of the last day of the Plan  Year) of
all remaining  non-segregated  accounts.  For the purpose of such  adjustment of
accounts,  any contribution  made by the Employer with respect to that Plan Year
shall be considered as having been made  immediately  after such  evaluation and
adjustment.  In making the adjustments required by this section the value of any
amounts  segregated  in  accordance  with  the  Non-segregation  if  Installment
Distribution section below, shall not be considered in determining the amount of
net  appreciation,  depreciation,  gain or loss to be allocated to such account.
The amount of any net appreciation,  depreciation,  gain or loss with respect to
such cash value or  segregated  account  shall be  allocated  to the  individual
account with respect to which it arose. In addition to the evaluations  required
by the first  sentence of this section,  the Trust Fund may be evaluated at such
other  times  during  the  Plan  Year  as  the  Administrative  Committee  deems
appropriate  using the method set forth in the Fair Market Value  definition  in
Article  II.For  purposes  of all  computations  required by this  section,  the
accrual  method of  accounting  shall be used to value  the  Trust  Fund and the
assets thereof at their fair market value as of each valuation date.  Qualifying
Employer  Securities  shall be accounted for as provided in Treasury  Regulation
Section  1.402W-1(b)(20),  as amended,  or any  regulation or statute of similar
import.

5.4 Limitations on Allocations to Each Participant.

     (a) Defined Contribution Plan Limitations.

          Notwithstanding  any other  provision of this Plan the maximum  annual
     addition   for  any  Plan  Year  which  can  be  made  to  any   individual
     Participant's  Employer and Participant  accounts,  taken together,  is the
     lesser of Thirty  Thousand  Dollars  ($30,000) (or, if greater,  one-fourth
     (1/4) of the defined  benefit  dollar  limitation set forth in Code Section
     415(b)(1) as in effect for the Plan Year) or  twenty-five  percent (25%) of

                                       13
<PAGE>
     the  Participant's  Compensation.  In addition  the  increased  limitations
     provided in Code Section 415(c)(6) shall apply if appropriate. For purposes
     of Subsections  5.4(a),  (b), and (c) the annual addition is the sum of the
     following amounts  allocated to the accounts of the individual  Participant
     for the Plan  Year of the Trust  (which  shall be the  limitation  year for
     purposes of Code Section 415) under this and all other defined contribution
     type plans maintained by the Employer:

               (i) Employer contributions;

               (ii) Forfeitures (if applicable);

               (iii) Participant contributions;

               (iv)  Amounts  allocated  to an  individual  medical  account (as
               defined  in Code  Section  415(1)(2))  that is part of a  defined
               benefit plan maintained by the Employer; and

               (v) Amounts  derived  from  contributions  paid or accrued  after
               December 31, 1985, in taxable years ending after such date,  that
               are attributable to post-retirement medical benefits allocated to
               the  separate  account  of a Key  Employee  (as  defined  in Code
               Section  419A(d)(3))  under a welfare benefit fund (as defined in
               Code Section 419(e)) maintained by the Employer.

          If  Subsections  5.4(a),  (b),  and (c) limit the amount  which can be
     allocated to the Employer  Account of any  Participant for a Plan Year, the
     excess  amount which cannot be allocated for the Plan Year shall be held in
     the suspense  account to be  allocated  on the last day of each  succeeding
     Plan Year  until the funds in the  suspense  account  have been  completely
     reallocated.  No  further  Employer  contributions  may be made to the Plan
     until the suspense account has been completely reallocated. Any Participant
     contributions  which exceed the limitations of Subsections 5.4(a), (b), and
     (c) shall be returned to the Participant. No investment gains and losses or
     other income shall be allocated to the suspense account.

     (b) Defined Benefit Plan Limitations.

          As to any defined benefit plan maintained by the Employer for any Plan
     Year the annual benefit cannot exceed the lesser of:

               (i) Ninety  Thousand  Dollars  ($90,000) (or such other figure as
               determined  in  accordance  with  the cost of  living  adjustment
               procedure of Code Section 415(d),  but only for the year in which
               such adjustment is effective), or

               (ii) One  hundred  percent  (100%) of the  Participant's  average
               annual  compensation  for the  Participant's  three  highest paid
               consecutive Plan Years;  however,  benefits of up to Ten Thousand
               Dollars  ($10,000)  during a Plan Year can be paid without regard
               to the  one  hundred  percent  (100%)  limitation  if  the  total
               retirement  benefits  payable to an  Employee  under all  defined
               benefit plans (as defined in Code Section  414(j))  maintained by
               the  Employer  for the  present  and any  prior  Plan Year do not

                                       14
<PAGE>
               exceed Ten Thousand Dollars ($10,000) and the Employer has not at
               any time  maintained a defined  contribution  plan (as defined in
               Code Section 414(i)) in which the Employee was a Participant.

          If the  Participant has less than ten (10) years of  participation  in
     the Plan (as defined in Code Section 415(b)(5)),  the applicable limitation
     in Paragraph  (b)(i) of this Section shall be reduced by  multiplying  such
     limitation  by a fraction.  The  numerator  of such  fraction  shall be the
     number of years, or part thereof,  of  participation in the defined benefit
     plan maintained by the Employer; the denominator shall be ten (10) years.

          For purposes of this Subsection  5.4(b),  the "annual benefit" means a
     benefit  payable  annually in the form of a straight  life  annuity with no
     ancillary  or  incidental   benefits  and  with  no  Employee  or  Rollover
     Contributions.  To the extent that  ancillary  benefits are  provided,  the
     limits set forth in  Subparagraphs;  (a) and (b) of the first  paragraph of
     this Section will be reduced actuarially, using an interest rate assumption
     equal to the greater of five percent (5%) or the interest rate specified in
     the Plan to reflect such ancillary benefits.

     (c) Social Security Retirement Age Limitations.

          "Social Security  Retirement Age" means the age used as the Retirement
     age under Section 216(l) of the Social Security Act, which is presently age
     sixty-five  (65) for a person born before 1939,  age  sixty-six  (66) for a
     person born between 1939 and 1954,  and age  sixty-seven  (67) for a person
     born after 1954.

          If  distribution  of  retirement  benefits  begins  before  the Social
     Security Retirement Age, the Ninety Thousand Dollar ($90,000) limitation as
     described  in  Subsection  5.4(b)  shall  be  reduced  actuarially  on  the
     following basis:

               (i) If the Social Security  Retirement Age is sixty-five (65) and
               distribution   of  benefits  begins  after  the  Participant  has
               attained  age  sixty-two  (62) but  before  the  Social  Security
               Retirement Age, the reduction  shall be five-ninths  (5/9) of one
               percent  (1%) per  month  for  each  month  by  which  the  first
               distribution precedes the Social Security Retirement Age;

               (ii) If the Social  Security  Retirement  Age exceeds  sixty-five
               (65)  and  the   distribution   of  benefits   begins  after  the
               Participant  has attained age sixty-two (62), the reduction shall
               be the sum of (A) and (B), where

                    (A) Is  five-ninths  (5/9) of one percent (1%) per month for
                    each of the first thirty-six (36) months; and

                    (B) Is  five-twelfths  (5/12) of one percent  (1%) per month
                    for each additional month (up to twenty-four (24) months) by
                    which   benefits   commence   before   the   month   of  the
                    Participant's Social Security Retirement Age;

                                       15
<PAGE>
               (iii)  If  the   distribution   of  benefits  begins  before  the
               Participant  has attained age sixty-two (62), the limitation will
               be the  actuarial  equivalent  of what it would  have been if the
               first  distribution  had  been  made  when  the  Participant  had
               attained age sixty-two  (62); the assumed  interest rate for such
               calculation shall be five percent (5%).

          For  purposes  of  this   Subsection   5.4(b)  the   "average   annual
     Compensation for a Participant's  three (3) highest paid consecutive years"
     shall mean the Participant's  greatest  aggregate  Compensation  during the
     period of three (3)  consecutive  Plan Years in which the individual was an
     active Participant in the Plan.

     (d) Combination Defined Benefit and Defined Contribution Plan Limitations.

          For years beginning before January 1, 2000, if the Employer  maintains
     one (1) or more  defined  benefit  plans in  addition to this Plan (and any
     other defined  contribution plans) the limitation of this Subsection 5.4(c)
     shall  apply in  addition to those of  Subsections  5.4(a) and 5.4(b).  The
     limitation of this Subsection 5.4(c) is that the sum of the defined benefit
     plan fraction and the defined  contribution plan fraction for any Plan Year
     may not exceed 1.0.

     The "defined benefit plan fraction" is a fraction:

               (i) The numerator of which is the projected annual benefit of the
               Participant  under the Plan,  (determined  as of the close of the
               Plan Year); and

               (ii) The denominator of which  (determined as of the close of the
               Plan Year) is the lesser of (A) the  maximum  dollar  limitation,
               for such year as stated in  Paragraph  5.4(b)(i),  multiplied  by
               1.25, or (B) the percentage of compensation  limitation which may
               be taken into account pursuant to Paragraph 5.4(b)(ii) multiplied
               by 1.4.

     The "defined contribution plan fraction" for any year is a fraction:

               (i) The numerator of which is the sum of the annual additions (as
               defined in Code Section  415(c)(2)) to the Participant's  account
               as of the close of the Plan Year; and

               (ii) The  denominator  of which is the sum,  for all  years of an
               Employee's service with the Employer, of the lesser for each year
               of (A) the  maximum  dollar  limitation  as  stated  in the first
               paragraph of Subsection  5.4(a) for such year  multiplied by 1.25
               or (B) the percentage of Compensation  amount in effect as stated
               in the  first  paragraph  of  Subsection  5.4(a)  for  such  year
               multiplied by 1.40.

          With respect to each Participant, for Years of Service ending prior to
     January 1, 1983,  the amount taken into account in the  denominator  of the
     defined  contribution  plan  fraction,  as set  forth  above,  may,  at the
     election of the Plan  Administrator,  be an amount equal to the denominator
     of the defined contribution plan fraction for the Plan Year ending in 1982,
     as determined  under the law immediately  prior to the enactment of the Tax
     Equity and Fiscal  Responsibility Act of 1982, multiplied by the transition
     fraction described in Code Section 415(e)(6).

                                       16
<PAGE>
     (e) Allocation Limitation- More Than One Defined Contribution Plan.

          If the Employer  contributes to more than one (1) defined contribution
     plan and as a result of the allocation of Forfeitures,  a reasonable  error
     in  estimating a  Participant's  Compensation  or other  limited  facts and
     circumstances which the Internal Revenue Service finds to be applicable, an
     amount  which  would  otherwise  be  allocated  would  result in the Annual
     Addition  limitation  being exceeded with respect to any  Participant,  the
     excess amount shall be eliminated as follows:

               (i) Any nondeductible Employee voluntary  contributions under any
               other defined  contribution plan, to the extent they would reduce
               the excess amount will be returned to the Participant.

               (ii) Any  unmatched  Employee  salary  deferrals  under a cash or
               deferred  arrangement  within the meaning of Code Section 401(k),
               to the  extent  they  would  reduce  the  excess  amount  will be
               returned to the  Participant.  To the extent necessary to further
               reduce the excess amount,  all salary  deferrals  under a cash or
               deferred  arrangement  within the meaning of Code Section 401(k),
               whether or not there was a corresponding  matching  contribution,
               will be returned to the Participant.

               (iii)  If the  sum of the  Annual  Additions  to a  Participant's
               Accounts, in all plans,  considered as one (1), would exceed said
               limitations, and in the event that the return to a Participant of
               the Participant's  contributions  under the preceding  paragraphs
               should  still fail to  alleviate  such  excess  amount,  then the
               amount of such excess shall be  reallocated in the profit sharing
               plan of the  Employer  then in the defined  contribution  pension
               plan (or if more than one (1) defined  contribution pension plan,
               in the order selected by the Employer).

          The otherwise  permissible  Annual Additions for any Participant under
     this Plan may also be further reduced to the extent necessary as determined
     by the  Employer,  to  prevent  disqualification  of  benefits  payable  to
     Participants  who  also  may  be  participating  in  another  tax-qualified
     pension,  profit sharing,  savings or stock bonus plan of the Employer. The
     Employer shall advise affected  Participants of any additional  limitations
     on their Annual Additions required by the foregoing.

          Any excess  amounts  attributed  to this Plan shall be returned to the
     Employer or be held in a Code Section 415 limitation suspense Account.

5.5 Designation of Beneficiary.

Each  Participant  may  designate  from  time  to time  in  writing  one or more
Beneficiaries,  who will receive the Participant's vested Accrued Benefit in the
event of the Participant's  death. If the Participant dies without having made a
Beneficiary  designation,  the Trustees  shall  distribute  such benefits in the
following order of priority to the deceased Participant's:

                                       17
<PAGE>
          (a)  Spouse,

          (b)  Lineal descendants,

          (c)  Parents, or

          (d)  Estate.

However,  in the  event of the  death of a married  Participant,  the  surviving
spouse must be the sole Beneficiary unless the surviving spouse has consented in
writing to a different  election,  has acknowledged the effect of such election,
and  the  consent  and   acknowledgment   are  witnessed  by  a  member  of  the
Administrative  Committee or a notary public. The consent of spouse shall not be
necessary  if it is  established  to  the  satisfaction  of  the  Administrative
Committee that there is no spouse,  the spouse cannot reasonably be located,  or
for such other reasons as the regulations may prescribe. The consent of a spouse
as reason  for not  requiring  such  consent  shall be  applicable  only to that
spouse.  If the spouse of a  Participant  becomes  locatable or if a Participant
remarries,  it shall be the duty of the  Participant  to bring  that fact to the
attention of the  Administrative  Committee.  If the Participant so notifies the
Administrative   Committee,   the   Administrative   Committee  shall  then,  if
applicable,  proceed to make  available  to such  spouse  the  consent of spouse
procedures described in this Section.

5.6 Participant Voting and Exercise of Stock Rights.

          (a) Each  Participant  shall be entitled to direct the  Trustees as to
     the  manner  in  which  any  Qualifying  Employer  Securities  which  are a
     registration-type class of securities (as defined in Code Section 409(e)(4)
     which are allocated to the Employer  Account of the  Participant  are to be
     voted and as to the  manner in which  other  rights  with  respect  to such
     Qualifying  Employer  Securities  are to be exercised.  With respect to any
     class of Qualifying  Employer  Securities which is not a  registration-type
     class of securities (as defined in Code Section  409(e)(4)),  a Participant
     shall be entitled to direct the  Trustees as to the manner in which  voting
     rights  will be  exercised  with  respect  to any  corporate  matter  which
     involves the voting of such shares allocated to the  Participant's  account
     with  respect to the approval or  disapproval  of any  corporate  merger or
     consolidation,     recapitalization,     reclassification,     liquidation,
     dissolution,  sale of substantially  all assets of a trade or business,  or
     such similar transactions as may be prescribed in Treasury regulations.

          (b) The Trustees shall notify  Participants  at least thirty (30) days
     (or a lesser period if thirty (30) days if impossible or impractical) prior
     to the voting or other  exercise of rights  referred to in paragraph (a) of
     this section.  The notice shall include all proxy  solicitations  and other
     materials  distributed to other  shareholders  holding any of the shares of
     stock described in this Plan as Qualifying Employer Securities.

          (c) The  Trustees  shall vote any shares and exercise any other rights
     with respect to  applicable  Qualifying  Employer  Securities in the manner
     instructed  by the  Participant.  The  Trustees  shall  vote any shares and
     exercise any other rights with respect to Qualifying Employer Securities as
     to which it receives no such  instructions  (either because the Participant
     does not timely give such instructions,  or because the shares have not yet
     been allocated to the Employer Accounts, or if because the Trustees are not
     required to be  directed)  as the  Trustees in their sole  discretion,  but
     acting  in a  fiduciary  capacity,  deems  in  the  best  interests  of the
     Participants and their Beneficiaries.

                                       18
<PAGE>
                              ARTICLE VI - VESTING

6.1 Employer Account Vesting on Death, Retirement, or Total Permanent
    Disability.

If a  Participant's  employment  is  terminated  for death,  on or after  Normal
Retirement  Age, or due to Total and Permanent  Disability,  one hundred percent
(100%)  of the  Accrued  Benefit  in his  Employer  Account,  shall  vest in the
Participant (or in his Beneficiary, as the case may be) and shall be distributed
or set aside in accordance with the provisions of Article VII.

6.2 Employer Account Vesting on Termination.

If a  Participant's  employment  is  terminated  except  for  death,  Total  and
Permanent  Disability,  or on or  after  Normal  Retirement  Age  the  following
percentages of the Accrued  Benefit in the Employer  Account of the  Participant
shall vest in the  Participant  and shall be distributed to or set aside for him
in accordance with the provisions of Article VII:

                Years of Service             Vested Percentage
                ----------------             -----------------
                   Less than 3                        0%
                       3                             40%
                       4                             70%
                       5                            100%

The Accrued Benefit of a Participant which is not vested as above provided shall
be retained by the Trustees for allocation as a Forfeiture,  in accordance  with
the  provisions  of Manner of Allocation  section  above,  Suspense  Account for
Terminated Participants and Unable to Locate Participant or Beneficiary sections
below.

6.3 Restoration of Forfeitures.

If a Participant is less than one hundred  percent (100%) vested and he receives
a distribution from the Plan and forfeits part of his Accrued Benefit, and then,
if the Participant resumes employment with the Employer before the occurrence of
five (5) consecutive  One Year Breaks in Service,  until such time as there is a
fifth (5th)  consecutive  One Year Break in Service,  the  Participant's  vested
portion of the  balance  in his  account at any time shall be equal to an amount
("X")  determined  by the  formula X = P(AB + D) - D,  where  "P" is the  vested
percentage  of  the  Participant  at  such  time,  "AB"  is the  balance  in the
Participant's  account  at such  time  and "D" is the  amount  distributed  as a
severance of employment benefit and not previously repaid by the Participant.

Notwithstanding  the  preceding   paragraph,   if  the  Participant  returns  to
employment  prior to the time he incurs five (5)  consecutive One Year Breaks in
Service,  he shall  have the  right to repay to the Plan the full  amount of the
benefits  previously  distributed  to him,  provided that such repayment is made
prior to the earlier of:

          (i) Five (5) years  after the first date on which the  Participant  is
          reemployed, or

          (ii) The date the  Participant  incurs five (5)  consecutive  One Year
          Breaks in Service following the date of the previous distribution.

If an  Employee  is deemed to  receive a  distribution  pursuant  to the Time of
Distribution  section below),  and the Participant  resumes  employment  covered
under the Plan before the date the Employee incurs five (5) consecutive One Year
Breaks in Service,  upon the  reemployment of such Employee,  the balance of the
Employer  Account of the Employee  will be restored to the amount on the date of
such deemed distribution.

If the  Participant's  forfeited  accrued  benefit is restored  pursuant to this
Section 6.3, the restoration shall be made first out of Forfeitures, if any, and
then by additional Employer contributions.

                                       19
<PAGE>
                     ARTICLE VII - DISTRIBUTION OF BENEFITS

7.1 Method of Distribution of Accounts.

          (a) If a Participant's  vested Accrued Benefit at the Termination Date
     does not exceed Five Thousand Dollars  ($5,000),  the entire amount of such
     vested  Accrued  Benefit shall be distributed in the form of an involuntary
     Cash-Out.  For all  Accrued  Benefits  that exceed  Five  Thousand  Dollars
     ($5,000), the Participant shall elect to receive his distribution in one of
     the  following  forms:  (a) a  voluntary  Cash-Out,  or (b) an  installment
     distribution consisting of approximately equal annual installments (subject
     to the limitations of Time of Distribution section) over a term certain.

          (b) The  Participant  shall  elect  to  receive  his  distribution  of
     benefits in the form of: (a) Cash, or (b)  Qualifying  Employer  Securities
     except to the extent that the  Participant's  Employer  Account consists of
     cash or  fractional  shares  of  Qualifying  Employer  Securities  or other
     assets, the Fair Market Value of which shall be distributed in cash.

          (c)  Distributions  shall be made by the  Trustee(s)  according to the
     directions  of the  Committee.  The  Committee  shall have the authority to
     direct the distributions according to the terms and conditions of the Plan.
     A  Participant  or  Beneficiary  shall  have the  right to file a claim for
     benefits in accordance with the Plan.  Distributions shall be made in cash,
     in kind,  or in a combination  of both.  All methods of  distribution  to a
     Participant or Beneficiary  shall be of equal value as of the date payments
     are to commence.

          (d) The  Company  retains the power and  discretion,  pursuant to Code
     Section  411(d)(6)(c),  to amend the  distribution  forms and  options in a
     nondiscriminatory fashion.

7.2 Time of Distribution.

          (a) After the Participant has attained the Normal  Retirement Age, has
     died,  or  has  terminated  his  employment  due  to  Total  and  Permanent
     Disability,  then the first  installment  or Cash-Out,  as the case may be,
     will be made as soon as administratively feasible after the end of the Plan
     Year in which the Participant completes a One Year Break in Service. If the
     Participant is zero percent (0%) vested in his Accrued Benefit, his account
     balance  will be deemed to have  been  distributed  to him in the form of a
     Cash-Out.  However,  in all events such distributions  shall begin no later
     than  sixty  (60) days  after the end of the Plan Year in which  occurs the
     latest of the following:

               (i)  The  date  on  which  the  Participant  attains  the  Normal
               Retirement Age;

                                       20
<PAGE>
               (ii) The  tenth  (10th)  anniversary  of the  year in  which  the
               Participant commenced participation in the Plan;

               (iii) The Termination Date.

          (b)  Distribution  to a Participant  who terminates  other than due to
     death, Retirement or Disability, shall commence as soon as administratively
     feasible after the end of the Plan Year in which the Participant  completes
     a One Year Break in Service.

          (c) Distributions shall commence no later than:

               (i) April 1 of the calendar  year  following the calendar year in
               which the  Participant  attains age seventy and one-half  (70-1 /
               2); or

               (ii) In the case of a Participant other than a Participant who is
               a five percent (5%) owner with respect to the Plan Year ending in
               the calendar  year in which the  Participant  attains age seventy
               and one-half (70-1/2), April 1 of the calendar year following the
               calendar year in which the Participant retires.

          (d) If distributions are made in installments  rather than a Cash-Out,
     then (i) the  installments  must be over a period of ten (10) years or less
     or (ii) the amount of the  installment to be distributed  each year must be
     at  least  an  amount  equal  to the  quotient  obtained  by  dividing  the
     Participant's  entire interest by the life expectancy of the Participant or
     the  joint  and  last  survivor  expectancy  of  the  Participant  and  his
     designated  Beneficiary.  Life  expectancy  and  joint  and  last  survivor
     expectancy  are  computed by the use of the return  multiples  contained in
     Treasury  Regulations  Section 1.72-9,  or, in the case of payments under a
     contract  issued by an  insurance  company,  by use of the life  expectancy
     tables of the  insurance  company.  For  purposes  of this  computation,  a
     Participant's  life  expectancy may be recalculated no more frequently than
     annually,  but the life  expectancy of a nonspouse  Beneficiary  may not be
     recalculated.   If  the   Participant's   spouse  is  not  the   designated
     Beneficiary,  the method of distribution selected must assure that at least
     fifty  percent  (50%) of the  present  value of the  amount  available  for
     distribution is paid within the life expectancy of the Participant.

          (e) If the Participant elects to receive his distribution in Cash, the
     Trustees  will sell the  Qualifying  Employer  Securities  allocated to the
     Participant's  account and to which the Participant  would be entitled to a
     distribution  and  distribute  the  cash  proceeds  of  such  sale  to  the
     Participant.  If such Qualifying  Employer Securities are not sold within a
     time which would allow the cash  distribution  to take place as required by
     this Time of Distribution  section,  the Participant will have the right to
     change his or her  distribution  election  to receive  Qualifying  Employer
     Securities  or defer  the  distribution  until  such  time as the  Trustees
     complete the sale of such Qualifying  Employer Securities or otherwise have
     sufficient cash to make the distribution.

          (f) If the Participant dies after  distributions to him have begun but
     before  his  entire  Accrued  Benefit  has  been  distributed  to him,  the
     remaining portion of his Accrued Benefit shall be distributed from the Plan
     at  least as  rapidly  as  under  the  method  of  distribution  previously
     established  for him,  if such  method  is  irrevocable  at the time of his
     death.

                                       21
<PAGE>
          (g)  If  the  Participant  dies  before  distribution  of  hisinterest
     commences,  then  distributions  of  the  Participant's  remaining  Accrued
     Benefit  must be  completed  by the end of the fifth  (5th)  calendar  year
     following the year of his death.  However,  installment  distributions to a
     designated  Beneficiary  which begin not later than the end of the calendar
     year following the death of the  Participant  shall be treated as complying
     with  this  five  (5)  year  distribution   requirement  (even  though  the
     installment  payments  are not  completed  within  five  (5)  years  of the
     Participant's  death) if the  distributions are made at a rate which is not
     longer than that  calculated  (in the manner  described in paragraph (c) of
     this Section) to provide payment of all the  Participant's  Accrued Benefit
     during the  anticipated  life  expectancy  of the  designated  Beneficiary.
     Provided that if the designated  Beneficiary is the surviving spouse of the
     deceased  Participant,  the  distributions  can  begin  as long  after  the
     Participant's  death as the date on which the  deceased  Participant  would
     have  attained the age of seventy and one-half  (70-1/2);  if the surviving
     spouse dies before  distributions  to the surviving  spouse have begun, the
     Plan may make  distributions  at such times as described in this Section as
     it would have if the surviving spouse had been a deceased Participant.

          (h) For  purposes  of this  section,  any amount  paid to a child of a
     Participant  will be treated as if it had been paid to the surviving spouse
     of  the  Participant  if  such  remaining  amount  becomes  payable  to the
     surviving spouse when the child reaches the age of majority.

7.3 Segregation if Installment Distribution.

The  Administrative  Committee  may  determine  that the  Employer  Account of a
Participant  who is no longer an Employee shall be segregated and set aside,  in
which event the Administrative  Committee shall direct the Trustees to segregate
the vested  portion  (as  defined in  Article  VI) of the entire  balance of the
Participant's  Employer  Account  and to  deposit  such  portion  in a  separate
interest  bearing  account at a bank or savings and loan  association,  and said
account shall cease to participate in the income or net loss or  appreciation or
depreciation  of the Trust Fund,  as of the  beginning of the Plan Year in which
such  segregation  occurs,  and instead will be credited with the full amount of
interest earned thereon.

7.4 Non-segrggation if Installment Distribution.

In the event the  Administrative  Committee  does not  segregate (as provided in
Section Segregation if Installment Distribution above) the Employer Account of a
Participant, said account shall continue to be treated, without interruption, in
the same  manner as when the  Participant  was an  Employee,  in which  case the
installment  distributions  shall be  adjusted  upward or  downward  to  reflect
appreciation or depreciation, or income or loss in the account balance.

7.5 Distribution After Death of Participant.

In the event of the  death of a  Participant  after  installment  payments  have
begun, but prior to completion of such payments,  the full amount of such unpaid
benefits  shall  continue to be paid in the form of the  previously  established
installments  except that the Beneficiary may request that the remaining Accrued
Benefit be paid in a lump sum.

                                       22
<PAGE>
In the event of the death of the Participant  prior to the start of any payments
of his Accrued Benefit,  distributions shall be made in the form and at the time
or times selected by the Beneficiary pursuant to Sections 7.1 and 7.2.

7.6 Distribution After Death of Beneficiary.

In the event of the death of a  Beneficiary  (or a  contingent  Beneficiary,  if
applicable)  prior to the completion of payment of benefits due the  Beneficiary
from the Plan, the full amount of such unpaid benefits shall at once vest in and
become the property of the estate of said Beneficiary. In determining the amount
of such  unpaid  benefits,  no  adjustment  shall be made by  reason  of any net
income,  or net loss. of the Trust, or any net  appreciation or net depreciation
by the Trust's assets subsequent to the beginning of the Plan Year in which such
final distribution occurs.

7.7 Rollover Contributions and Distributions.

Rollovers from other qualified plans into the Plan will not be permitted.

The  Administrative  Committee  may, in its sole  discretion,  but only with the
prior  written  consent of the  Participant,  transfer  part or all of the funds
credited to his  Employer  Account to a  retirement  plan,  as described in Code
Section  401(a) or Section 403(a) as to which the individual is a Participant at
the time of such distribution.

The Committee shall provide to each Participant,  Beneficiary or Alternate Payee
who  receives  an eligible  rollover  distribution  (as defined in Code  Section
402(f), at the time such distribution is made, a written explanation of the:

          (a) Provisions under which the distribution will not be subject to tax
     if timely transferred to an eligible retirement plan; and, if applicable,

          (b)  Provisions  regarding  the  availability  of  capital  gains  and
     ten-year   averaging  or   five-year   averaging   tax   treatment  of  the
     distribution.

For  distributions  made  on or  after  January  1,  1993,  notwithstanding  any
provisions  of  the  Plan  to  the  contrary  that  would   otherwise   limit  a
distributee's  election under this  Subsection,  a distributee may elect, at the
time and in the manner  prescribed by the  Committee,  to have any portion of an
eligible  rollover  distribution  paid directly to an eligible  retirement  plan
specified by the distributee in a direct rollover.

          (a) An eligible  rollover  distribution is any  distribution of all or
     any portion of the balance to the credit of the distributee, except that an
     eligible  rollover  distribution  does not include any distribution that is
     one  of a  series  of  substantially  equal  periodic  payments  (not  less
     frequently  than  annually)  made for the life (or life  expectancy) of the
     distributee  and  the  distributee's  designated  Beneficiary,   or  for  a
     specified  period of ten (10) years or more; any distribution to the extent
     such distribution is required under Code Section 401(a)(9); and the portion

                                       23
<PAGE>
     of any  distribution  that is not  Includible  in gross income  (determined
     without  regard  to the  exclusion  for net  unrealized  appreciation  with
     respect to Qualifying Employer Securities).

          (b) An eligible  retirement plan is an individual  retirement  account
     described  in  Code  Section  408(a),  an  individual   retirement  annuity
     described in Code Section 408(b), an annuity plan described in Code Section
     403(a), or a qualified trust described in Code Section 401(a), that accepts
     the distributee's eligible rollover  distribution.  However, in the case of
     an eligible  rollover  distribution  to the surviving  spouse,  an eligible
     retirement  plan  is  an  individual   retirement   account  or  individual
     retirement annuity.

          (c) A distributee  includes a Participant  or former  Participant.  In
     addition,  the  Participant's  surviving  spouse,  and the Participant's or
     former  Participant's  spouse or former  spouse who is an  Alternate  Payee
     under a Qualified  Domestic  Relations  Order,  as defined in Code  Section
     414(p),  are  distributees  with  regard to the  interest  of the spouse or
     former spouse.

          (d) A  direct  rollover  is a  payment  by the  Plan  to the  eligible
     retirement plan specified by the distributee.

7.8 Suspense Account for Terminated Participants.

If a Participant  has terminated his employment but his Employer  Account is not
one hundred percent (100%) vested and he has not had a One Year Break in Service
subsequent to his  termination,  all funds in his Employer Account shall be held
in  suspense  until the  happening  of the  soonest  of the  following:  (i) the
Participant returning to employment with the Employer, or (ii) the occurrence of
a One Year  Break in  Service  with  respect  to the  Participant,  or (iii) the
Participant  attaining Normal Retirement Age, or (iv) the Participant receives a
Cash Out. At such time the Participant's Employer Account shall cease to be held
in suspense.  If a Participant  has returned to employment  prior to incurring a
One Year Break in Service,  his Employer Account which has been held in suspense
shall be  restored  to his  credit,  less any  Cash-Out  which is not  repaid in
accordance  with  Section  7.10.  If a One Year  Break in  Service  occurs,  the
non-vested  portion of the Employer  Account held in suspense  will be forfeited
and  reallocated in accordance  with the Manner of Allocation  section above for
the Plan Year in which  such  Forfeiture  occurs;  the vested  portion  shall be
distributed  in accordance  with the provisions of Article VII. In the case of a
Participant  attaining Normal Retirement Age while his Employer Account is being
held  in  suspense,  the  entire  vested  amount  will  be  distributed  and the
non-vested  portion shall be forfeited in accordance with the provisions of this
Article VII.

Such account  shall share in any  appreciation,  depreciation,  or net income or
loss as if it were not in suspense,  except that an account which is in suspense
shall have no Forfeitures  allocated to it for a Plan Year in which the Employee
does not have a Year of Service for Accrual of Benefits.

Notwithstanding  anything  contained  in this  Suspense  Account for  Terminated
Participants section to the contrary, upon the payment of a Participant's vested
Accrued Benefit through a Cash-Out, the non-vested portion of such Participant's
Accrued Benefit shall be forfeited and shall be reallocated for the Plan Year in
which a One Year  Break in  Service  occurs  in  accordance  with the  Manner of
Allocation section above.

                                       24
<PAGE>
7.9 Unable to Locate Participant or Beneficiary.

If the Participant or Beneficiary to whom benefits are to be distributed  cannot
be located,  and reasonable  efforts have been made to locate the Participant or
Beneficiary,  including the sending of  notification  by certified or registered
mail to his last known  address,  the  Administrative  Committee  may direct the
Trustees to take any of the following actions:

          (i) Distribute the benefits in question to an interest bearing savings
          account established in the name of the Participant or Beneficiary; or,
          if the benefits are payable to a Participant (as reasonably determined
          by the  Administrative  Committee)  the  Administrative  Committee may
          instruct the Trustees to distribute  the funds to the  Participant  by
          placing  them in a savings  account  in the  Participant's  name or by
          purchasing U.S.  Savings Bonds in the  Participant's  name and holding
          them for the Participant;

          (ii) If the Administrative Committee has taken the reasonable efforts,
          as described in the preceding sentence, to locate the Participant, the
          Administrative   Committee  may  allocate  the  Participant's  Accrued
          Benefits to a  segregated  account in the manner  described in Section
          7.3, as if an installment  distribution were being made; however, such
          funds shall be held in the segregated  account for distribution to the
          Participant when located;

          (iii)  The  Participant's   Accrued  Benefits  may  be  forfeited  and
          reallocated pursuant to the Manner of Allocation section above; if the
          Participant  subsequently  returns,  such Forfeiture shall be restored
          pursuant to Section 6.5 and the restoration shall be made first out of
          Forfeitures, if any, and then by additional Employer contributions.

7.10 Repayment of Cash-Out.

If a Participant  receives a Cash-Out  distribution from the Plan as a result of
ceasing to be an Employee, and is less than one hundred percent (100%) vested in
his Accrued Benefit at such time,  Participant  shall have the right to repay to
the Plan the Cash-Out  distribution  received from the Plan, prior to the sooner
of (i) five (5) years from the  individual  again  becoming an Employee,  or the
completion of five (5) consecutive One Year Breaks in Service following the date
of distribution  of the Cash-Out to the  Participant.  If the Participant  makes
such payment within the time specified in the preceding sentence, any non-vested
portion of his Cash-Out distribution which was forfeited pursuant to Section 7.8
will be restored to his credit.  The  permissible  sources of restoration of the
forfeited  portion of a  Cash-Out  distribution  are:  income or gains from Plan
investments, Forfeitures and Employer contribution. However, except with respect
to the  forfeited  portion  of a Cash-Out  distribution,  only  amounts  held in
suspense pursuant to Section 7.8 shall be used to satisfy such restoration.

7.11 Options of Participants to Sell Stock.

          (a) If the Qualifying  Employer Securities are not readily tradable on
     an  established  securities  market,  and if the  Employer is not a bank or
     financial  institution  prohibited by applicable  federal or local law from
     redeeming its stock, a Participant or Beneficiary  shall have the option to
     sell to the Employer all  Qualifying  Employer  Securities  which have been
     distributed to Participant or Beneficiary,  at a price determined  pursuant
     to a fair valuation  formula which is calculated to provide the fair market
     value of such securities as of the valuation date immediately preceding the
     date of the exercise of this "put" option, during the sixty (60) day period
     immediately  following the date on which Qualifying Employer Securities are
     distributed and for a sixty (60) day period beginning on the later of:

                                       25
<PAGE>
          (i)  the  first  day  of  the  Plan  Year  immediately  following  the
          distribution of Qualifying Employer Securities to the Participant; or

          (ii) the first day  following  the  expiration of the first sixty (60)
          day option period.

          (b) The put option required by Section 7.11(a) shall provide that if a
     Participant or Beneficiary exercises the put option, the Employer,  (or the
     Plan, if the Plan so elects),  shall  repurchase  the  Qualifying  Employer
     Securities in one of the following methods:

          (i)  Payment  of the  fair  market  value of the  Qualifying  Employer
          Securities,  determined as of the valuation date immediately preceding
          the  date  of  the  exercise  of  the  put  option,  may  be  made  in
          substantially equal payments not less frequently than annually, over a
          period not exceeding five years. The first  installment  shall be paid
          not later than thirty (30) days after the  Participant  exercises  the
          put option.  The Employer  will pay a reasonable  rate of interest and
          provide adequate security on amounts not paid after thirty (30) days.

          (ii) The Employer may pay the  Participant  or  Beneficiary  an amount
          equal to the fair market value,  determined  as of the valuation  date
          immediately  preceding the date of the exercise of the put option,  of
          the Qualifying  Employer  Securities  repurchased no later than thirty
          (30) days after the date the put option is exercised.

          (c)  The  Trust   shall  have  the   option,   but  in  no  event  the
     responsibility, to assume the rights and obligations of the Employer at the
     time the put option required by Section 7.11 (a) is exercised.

7.12 Right of First Refusal.

All shares of Qualifying Employer Securities distributed by the Trustee,  except
those which are publicly traded, shall be subject to a "right of first refusal."
Such right shall provide that, prior to any subsequent transfer, the shares must
first be offered by written offer to the Employer, unless the Employer is a bank
or financial  institution  prohibited  from  redeeming  its stock by  applicable
federal or local law, and Trust in any order of priority.  In the event that the
proposed  transfer  constitutes a gift or such other  transfer at less than fair
market value, the Plan Administrator  shall so advise the Trustees and the price
per  share  shall be  determined  by the  Trustee  under the Fair  Market  Value
definition  in Article II as of the last day of the Plan Year, or in the case of
a  transaction  between  the Plan and a  disqualified  person as defined in Code
Section  4975(e)(2),  as of the  date  of the  transaction.  In the  event  of a
proposed  purchase by a prospective bona fide purchaser,  the offer to the Trust
shall  be at the  greater  of fair  market  value,  as  determined  above by the
Trustees or at the price offered by the  prospective  bona fide  purchaser.  The
Employer or Trust, as the case may be, may accept the offer at any time during a
period not exceeding  fourteen (14) days after the security holder gives written
notice to the Trustees that an offer by a third party to purchase the Qualifying
Employer  Securities  has been  received  or that a  transfer  of any sort is to
occur.

7.13 Distribution of Dividends.

On or  before  the  thirtieth  (30th)  day after the close of each Plan Year the
Administrative  Committee  shall direct the Trustees as to whether any or all of
the cash dividends received on any Qualifying Employer Securities, if any, owned

                                       26
<PAGE>
by the Plan shall  be:(i)  retained  by the Plan and  allocated  pursuant to the
Valuation of Assets and Allocation of Changes section;  (ii) distributed to each
Participant;  or (iii) used to make payments on an Exempt Loan. In the event the
Administrative Committee elects to cause the cash dividends to be distributed to
Participants,  each  Participant  shall receive,  no later than ninety (90) days
after the close of the Plan Year in which  the  dividend  is paid,  the pro rata
share,  computed in accordance  with the provisions of Section 5.3, of such cash
dividend (excluding earnings thereon).

7.14 Diversification of Investments.

          (a)  Notwithstanding  Sections 5.01 and Article VIII,  each  Qualified
     Participant  shall be permitted to direct the Plan as to the  investment of
     twenty-five percent (25%) of the value of the Participant's account balance
     attributable-to  Qualifying  Employer Securities which were acquired by the
     Plan after December 31, 1986, within ninety (90) days after the last day of
     each Plan Year during the Participant's  Qualified Election Period.  Within
     ninety (90) days after the close of the last Plan Year in the Participant's
     Qualified  Election Period, a Qualified  Participant may direct the Plan as
     to the  investment  of fifty  percent  (50%) of the  value of such  account
     balance.

          (b)  The   Participant's   direction   shall   be   provided   to  the
     Administrative  Committee in writing;  shall be effective no later than one
     hundred  eighty  (180)  days  after the close of the Plan Year to which the
     direction  applies;  and shall  specify  which,  if any, of the options set
     forth in Section 7.14(c) the Participant selects.

          (c) At the  election  of the  Qualified  Participant,  the Plan  shall
     distribute in cash or stock the portion of the  Participant's  account that
     is covered by the  election  within  ninety (90) days after the last day of
     the period during which the election can be made.  This Section shall apply
     notwithstanding  any other provision of the Plan other than such provisions
     as require the consent of the Participant and the Participant's spouse.

          (d)  In  lieu  of  distribution  under  this  Section,  the  Qualified
     Participant who has the right to receive a distribution may direct the Plan
     to transfer the portion of the Participant's account that is covered by the
     election to another  qualified  plan of the  Employer  which  accepts  such
     transfers, provided that such Plan permits Employee-directed investment and
     does not invest in Qualifying  Employer Securities to a substantial degree.
     Such  transfer  shall be made no later than ninety (90) days after the last
     day of the period during which the election can be made.

7.15 Qualified Domestic Relations Orders.

Notwithstanding  any other  provisions of Article VII, any Accrued  Benefit of a
Participant  may be apportioned  between the Participant and the alternate payee
(as defined in Code Section  414(p)(8))  either through separate  accounts or by
providing the alternate  payee a percentage of the  Participant's  account.  The
Committee may direct distributions to an alternate payee pursuant to a Qualified
Domestic  Relations Order as defined in Code Section  414(p)(1)(A)  prior to the
date on which the Participant attains the earliest Retirement Age, provided that
the Committee has properly notified the affected  Participant and each alternate
payee of the order and has  determined  that the order is a  Qualified  Domestic
Relations  Order as defined in Code Section  414(p)(1)(A).  The alternate  payee
shall be paid a separate account or a percentage of the  Participant's  account,
computed as of the  valuation  date  described  in the  Valuation  of Assets and
Allocations   of  Changes   section  of  the  Plan,   in  a  lump  sum   payment
notwithstanding the value of such lump sum payment unless the domestic relations
order  specifies  a  different  manner of  payment  permitted  by the Plan.  The
alternate  payee shall not be required to consent to such lump sum payment.  The
Committee shall adopt reasonable procedures to determine the qualified status of
Qualified   Domestic  Relations  Orders  and  to  administer  the  distributions
thereunder. In no event will a Qualified Domestic Relations Order which provides
that a former spouse is to be treated as the current  spouse of a Participant be
considered a Qualified Domestic Relations Order under this Plan, notwithstanding
that such Qualified  Domestic  Relations Order is a Qualified Domestic Relations
Order as defined in Code Section 414(p)(1)(A).

                                       27
<PAGE>
                 ARTICLE VIII - DUTIES AND AUTHORITY OF TRUSTEE

8.1 Receive Payments.

The Trustees  shall receive from the Employer the payments made by it on account
of its  contributions  under  the Plan but the  Trustees  shall  have no duty to
compute any amount due from the Employer or to collect the same.

8.2 Evaluate Assets.

The Trustees  shall  evaluate the assets of the Trust Fund as of the dose of the
last day of each Plan Year at their  Fair  Market  Value and the  Administrative
Committee or its agent will allocate the sums  contributed  by the Employer plus
the net  income  or  minus  the net  loss of the  Trust  Fund  and  plus the net
appreciation  or minus  the net  depredation  in the Trust  assets  to  separate
bookkeeping accounts in the names of the respective  Participants under the Plan
in accordance with the provisions of the Fair market Value definition in Article
II and Valuation of Assets and Allocations of Changes sections of the Plan.

8.3 Segregation of Accounts.

When directed in writing by the  Administrative  Committee,  the Trustees  shall
segregate  the  accounts  of  terminated  Participants  in  accordance  with the
provisions  of Section 7.3, and make payments out of the Trust Fund from time to
time to the Participants or their Beneficiaries, such payments to be made in the
manner and in the amounts as may be specified in the written instructions of the
Administrative Committee.

8.4 Tax Returns and Reports.

If the Trustees are a corporate  fiduciary,  then such Trustees shall prepare or
cause  to have  prepared  and  filed,  all tax  returns,  reports,  and  related
documents,  except as otherwise specifically provided in this Plan or unless the
Administrative  Committee, in writing, relieves the Trustees of such obligation,
in part or entirely, in which case the Administrative  Committee,  or the person
or persons  it  designates,  shall be  responsible  for filing the tax  returns,
reports, and related filings, as provided by the Administrative  Committee.  The
Trustees shall be entitled to rely on the accuracy of any written statement from
the  Administrative  Committee  or from an officer of the  Employer  as to those
matters provided i n Article IX.

8.5 Powers.

The Trustees are authorized and empowered to:

          (a) Invest and reinvest the Trust Fund,  without  distinction  between
     principal and income,  in Qualifying  Employer  Securities,  bank accounts,
     certificates of deposit,  Common Stocks,  preferred stocks,  bonds,  notes,
     debentures,  mortgages,  U.S. retirement plan bonds, and in other property,
     real or personal,  so long as the  incidents of ownership of such  property
     are  within the  jurisdiction  of the  United  States,  and so long as such
     investments do not violate applicable law;

          (b) Purchase and hold Qualifying  Employer Securities in a value up to
     one hundred percent (100%) of the total value of the Trust Fund, and borrow
     funds and pledge as collateral  therefor the Qualifying Employer Securities
     so  acquired;  the  Trustees  shall  have the duty to invest  primarily  in
     Qualifying Employer Securities;

          (c) Purchase,  sell, exchange,  convey, transfer, or otherwise realize
     the value of any property held by it,  specifically  including the purchase
     and sale of  Qualifying  Employer  Securities  from or to the Employer or a
     disqualified  person (as defined in Code Section  4975(e)(2)) or a party in
     interest (as defined in ERISA  Section  3(14)) if such  purchase or sale is
     for  adequate  consideration  and no  commission  is charged  with  respect
     thereto;

                                       28
<PAGE>
          (d) Convert any stocks, bonds, or other securities; to give general or
     special   proxies  or  powers  of  attorney   with  or  without   power  of
     substitution; to exercise any warrants, conversion privileges, subscription
     rights,  or other options and to make any payment  incidental  thereto;  to
     consent to or otherwise  participate in corporate  reorganizations or other
     changes affecting corporate securities and to delegate discretionary powers
     to pay any assessments or charges in connection therewith; and generally to
     exercise  any of the  powers of an owner with  respect  to  stocks,  bonds,
     securities or other properties held in the Trust Fund;

          (e) Make, execute,  acknowledge,  and deliver any and all documents of
     transfer and conveyance and any other  instruments that may be necessary or
     appropriate to carry out the powers herein granted;

          (f) Register any investments held in the Trust Fund in its own name or
     in the name of a nominee or nominees and to hold any  investment  in bearer
     form,  but the books and  records of the  Trustees  shall at all times show
     that all such investments are part of the Trust Fund;

          (g) Invest all or a part of the Trust  Fund in  deposits  which bear a
     reasonable  rate of  interest in a bank or similar  financial  institution,
     even though such institution is a Trustee or other fiduciary, as defined in
     Code Section 4975(e)(3);

          (h) Invest in a common or collective  trust fund or pooled  investment
     fund  maintained by a bank or trust company or a pooled  investment fund of
     an insurance  company  qualified to do business in a State even though such
     bank,  trust  company or insurance  company is a  disqualified  person,  as
     defined in Code Section 4975(e)(2);

          (i) Take  whatever  actions are  necessary  to ensure that  Qualifying
     Employer  Securities  consisting  of stock are  distributed  in the  manner
     prescribed  in Section 7.1;  such actions may include,  but are not limited
     to,  purchasing or exchanging such stock from the Trust, even though it has
     already  been  allocated  to the  Employer  Accounts  of  Participants  and
     purchasing or  exchanging  such stock as described in  subparagraph  (c) of
     this Section;

          (j) Purchase Qualifying  Employer  Securities from persons,  including
     "disqualified  persons" as that term is defined in Code Section 4975(e)(2),
     so long as the purchase price does not exceed the Fair Market Value of such
     securities  and so  long  as  the  terms  of  the  purchase  are  fair  and
     reasonable;

          (k) Perform all such acts, although not specifically mentioned herein,
     as the Trustees  may deem  necessary  to  administer  the Trust Fund and to
     carry out the purpose of the Trust; and

          (1) Borrow,  or loan,  except as  prohibited  by Code Section  4975(c)
     without  reference to Code  Section  4975(d),  sums as the  Trustees  deems
     desirable,  and for that purpose,  to mortgage or pledge all or part of the
     Trust Fund; and borrow from "disqualified persons" (as that term is defined
     in Code Section  4975(e)(2))  in such amounts as permitted by Section 8.11,
     for the purpose of purchasing Qualifying Employer Securities.

                                       29
<PAGE>
8.6 Expenses.

All brokerage costs,  transfer taxes and similar expenses incurred in connection
with the investment and reinvestment of the Trust Fund and all taxes of any kind
whatsoever which may be levied or assessed under existing or future laws upon or
in respect of the Trust  Fund,  and any  interest  which may be payable on money
borrowed by the Trustees for the purpose of the Trust  (however,  such funds may
not be borrowed for the purpose of purchasing  Qualifying Employer  Securities),
shall be paid from the Trust Fund,  and, until paid,  shall  constitute a charge
upon the Trust Fund. All other administrative  expenses incurred by the Trustees
in the performance of its duties, including such compensation to the Trustees as
may be agreed upon from time to time  between the  Employer and the Trustees (in
accordance with the Trustees'  standard  schedule of fees in effect from time to
time during the time it administers  this Trust,  if applicable)  and all proper
charges and  disbursements of the Trustees,  shall be paid by the Employer,  but
until  paid shall  constitute  a charge  upon the Trust  Fund.  If the  Employer
advises  the  Trustees  in  writing  of its  determination  to make  no  further
contribution  to this Trust,  the expenses of the Trustees  shall  thereafter be
charged  against  and paid  out of the  Trust  Fund  and a lien for the  payment
thereof  shall  be  impressed  upon  the  assets  of  the  Trust  to be  charged
proportionately  against the amount standing to the credit of each  Participant.
However,  no person who is a  disqualified  person (as  defined in Code  Section
4975(e)(2))  and who  received  full-time  pay from the  Employer,  may  receive
compensation  from the Trust,  except for reimbursement of expenses properly and
actually incurred.

The Trustees may inspect the records of the Employer  whenever  such  inspection
may be  reasonably  necessary  in order to determine  any fact  pertinent to the
performance of its duties as the Trustees.  The Trustees,  however, shall not be
required to make such inspection,  but may, in good faith, rely on any statement
of the Employer or any of its officers.

8.7 Litigation.

The Trustees shall not be required to  participate in any litigation  either for
the  collection of moneys or other property due the Trust Fund, or in defense of
any claim against the Trust Fund unless the Trustees shall have been indemnified
to its  satisfaction  against all expenses  and  liability to which the Trustees
might become subject.

8.8 Written Instructions.

When any act of the Trustees is based upon  instructions  of the Employer or the
Administrative  Committee,  the Trustees may rely upon  instructions in writing,
signed by an officer of the  Employer,  or upon  written  instructions  from the
Administrative Committee, as appropriate.

8.9 Appointment of Investment Manager.

The Trustees, with the written concurrence of the Administrative  Committee, may
appoint an  Investment  Manager (as defined in ERISA Section  3(38)),  who shall
have  responsibility  for investment of the Trust Fund.  The Investment  Manager
shall have the  investment  powers granted the Trustees in Section 8.5 except to
the extent  the  Investment  Manager's  powers  are  specifically  limited by an
agreement between the Trustee and Investment Manager.

                                       30
<PAGE>
8.10 Removal and Resignation of the Trustee.

The  Employer may at any time remove any Trustee  acting  hereunder or appoint a
corporation  and/or  an  individual  or  individuals  to  be  successor  Trustee
hereunder in the place of any removed or resigning  Trustee.  Any Trustee may at
any time resign by giving  written  notice to the  Employer,  which  resignation
shall take effect on the date therein specified and which shall not be less than
thirty (30) days from the date of notice  unless the Employer  shall agree to an
earlier date.

8.11 Loans from Disqualified Persons.

The Trustees  shall have the power to borrow funds either in the form of cash, a
purchase  money   transaction,   or  the  assumption  of  an  obligation,   from
"disqualified persons" (as that term is defined in Code Section 4975(e)(2)),  or
guaranteed by  disqualified  persons,  for the purpose of purchasing  Qualifying
Employer  Securities  or to repay amounts which were borrowed for the purpose of
purchasing such securities, only if the following conditions are met:

          (a) Such loan must  provide for  periodic  payments  over a definitely
     ascertainable term;

          (b) The only assets given as  collateral  for such loan may be, in the
     case of a loan to purchase Qualifying Employer Securities, those Qualifying
     Employer  Securities  purchased  with the proceeds of the loan,  and in the
     case of a loan  to  refinance  a prior  loan  used  to  acquire  Qualifying
     Employer Securities,  the Qualifying Employer Securities acquired with such
     prior loan;

          (c) The only Plan assets  available upon default to persons who loaned
     funds or who are  entitled  to  payments  under a loan from a  disqualified
     person are:

               (i) Qualifying  Employer  Securities  given pursuant to paragraph
               (b) above;

               (ii)  Contributions made to the Plan, other than contributions of
               Qualifying Employer Securities,  that are made for the purpose of
               meeting the Plan's obligations under the loan; and

               (iii) Earnings  attributable to amounts described in (i) and (ii)
               of this sentence;

          (d) Amounts  paid during a Plan Year in repayment of such loan may not
     exceed amounts contributed (during the current and prior Plan Years) to the
     Plan for the purpose of meeting the Plan's obligations under the loan, less
     total prior payments on the loan;

          (e) Amounts  contributed  to the Plan for the purpose of meeting  loan
     obligations  shall, prior to making payments under such loan, be segregated
     from the other  amounts held by the Plan and all earnings  thereon shall be
     allocated to such segregated account;

                                       31
<PAGE>
          (f) Upon default,  Plan assets shall be transferred to the lender,  in
     an amount which is necessary to make payments which are currently due under
     the payment  schedule of the loan,  without  acceleration of future amounts
     due thereon;

          (g)  Interest   charged  under  the  loan  must  be  reasonable  after
     considering  all relevant  factors such as the loan's  amount and duration,
     the amount of security provided the lender  (including any guarantee),  the
     credit standing of the Plan and prevailing interest rates;

          (h) Qualifying Employer Securities which are pledged as collateral for
     such loan must be released from encumbrance at the end of each Plan Year in
     an amount equal to the number of currently encumbered securities multiplied
     by a fraction, the numerator of which is the total payment of principal and
     interest  made during the Plan Year,  and the  denominator  of which is the
     total  payment of principal and interest made during the Plan Year plus the
     total  payment of principal  and interest due under the loan for all future
     Plan Years.  (If the  interest  rate under the loan is  variable  the above
     calculation  must be made using the interest rate which is applicable as of
     the end of the Plan Year in which such calculation is made.)  Securities of
     different classes must be released from encumbrance in equal percentages;

          (i) All Qualifying Employer Securities acquired with the proceeds of a
     loan from a "disqualified  person",  whether they are pledged as collateral
     for such loan or not,  shall be held in suspense in the  Unallocated  Stock
     Account  and shall be removed  from such  account and be  allocated  to the
     Employer  Accounts  of  Participants  at the end of each  Plan  Year to the
     extent  paragraph  (h) of this  Section  8.11  provides  for the release of
     encumbered securities. Income earned from securities held in suspense shall
     be  deemed to be the  income of the Plan and shall not be held in  suspense
     unless such income has been pledged as  collateral  for the loan.  Should a
     portion  of a  Participant's  Employer  Account  be  forfeited,  Qualifying
     Employer Securities held in suspense for such Participant  pursuant to this
     paragraph may only be forfeited after all other assets in the Participant's
     Employer Account are forfeited.

               ARTICLE IX - DUTIES AND AUTHORITY OF ADMINISTRATIVE
                                    COMMITTEE

9.1 Appointment.

This  Plan  shall  be  administered  by the  Administrative  Committee  as  Plan
Administrator.  The  Board  of  Directors  of the  Employer  shall  appoint  the
Administrative  Committee,  which shall  consist of at least two (2) persons who
shall signify in writing their acceptance of such appointment. Any member of the
Administrative  Committee may resign upon giving  written notice to the board of
directors of the Employer.  Each appointee  shall hold office at the pleasure of
the Board Of Directors.  Vacancies arising in the Administrative  Committee from
death,  resignation,  removal  or  otherwise,  shall be  filled  by the Board Of
Directors,   but  the  Administrative  Committee  may  act  notwithstanding  the
existence  of  vacancies  so  long  as  there  is at  least  one  member  of the
Administrative Committee who is a director.

At any time the  Board Of  Directors  of the  Employer  may  adopt a  resolution
abolishing the  Administrative  Committee and reserving all of the duties of the
Administrative  Committee to the Board of Directors.  Such  resolution  shall be
effective as soon as it is  communicated  in writing to both the  Administrative
Committee and Trustees,  or at any such subsequent effective date as is provided
in the resolution.  Whenever such a resolution is effective as to the Plan or in
the  event  an  Administrative   Committee  is  not  appointed,  the  term  Plan
Administrator  or Board  of  Directors  shall  be  deemed  to  replace  the term
"Administrative  Committee."  Such a resolution may be rescinded by the board of
directors and shall be effective as soon as it is communicated in writing to the
Trustees,  or  shall be  effective  at such  later  date as is  provided  in the
resolution.

9.2 No Discrimination.

The  Administrative  Committee shall not take any action nor direct the Trustees
to take any action that would result in benefiting  one  Participant or group of
Participants at the expense of another, or discriminating  between  Participants
similarly situated, or applying different rules to substantially similar sets of
facts.

                                       32
<PAGE>
9.3 Majority Action.

The Administrative Committee shall act by a majority (or by all members if there
be  only  one  or two  members)  of  the  number  of  members  constituting  the
Administrative  Committee  at the time of such  action,  and such  action may be
taken either by vote at a meeting or in writing without a meeting.

9.4 Powers.

Except as otherwise  provided in the Plan, the  Administrative  Committee  shall
have control of the  administration  of the Plan,  with all powers  necessary to
enable it to carry out its duties in that  respect.  Not in  limitation,  but in
amplification of the foregoing, the Administrative Committee shall have power to
interpret  or construe the Plan and to determine  all  questions  that may arise
hereunder as to the status and rights of Participants and others hereunder.  The
Administrative  Committee  may inspect  the records of the  Employer or Trustees
whenever such  inspection may be reasonably  necessary in order to determine any
fact pertinent to the performance of the duties of the Administrative Committee.
The  Administrative  Committee,  however,  shall  not be  required  to make such
inspection  but may, in good faith,  rely on any  statement  of the  Trustees or
Employer or any of its officers or Employees.

9.5 Filing Reports.

The  Administrative  Committee  shall  furnish,  or shall see that the  Employer
furnishes,  a summary of this Plan to all  Employees,  as required by applicable
Federal  law. The  Administrative  Committee  shall  furnish to the Trustees the
names  of  all  Employees  who  become   eligible  as   Participants,   and  the
Administrative Committee shall notify each Employee of his eligibility.

9.6 Records and Information.

The Administrative Committee shall keep a complete record of all its proceedings
and all data necessary for the administration of the Plan.

9.7 Information to Participants.

The  Administrative  Committee shall direct the maintenance of separate accounts
of the Participants.  It shall give each Participant,  at least once every year,
information as to the balance of his Employer Account.

9.8 Compensation of Members.

The members of the Administrative Committee shall serve without compensation for
their  services  as  such,  but  shall be  reimbursed  by the  Employer  for all
necessary  expenses  incurred in the discharge of their duties.  If the Employer
advises the Administrative  Committee in writing of its determination to make no
further contributions to the Plan, the expenses of the Administrative  Committee
shall  thereafter  be charged  against and paid out of the Trust Fund and a lien
for the payment  thereof  shall be impressed  upon the assets of the Trust to be
charged  proportionately  against  the  amount  standing  to the  credit of each
Participant.

                                       33
<PAGE>
9.9 Review of Participant's Claims.

In case the claim of any  Participant or Beneficiary for benefits under the Plan
is denied, the Administrative Committee shall provide adequate notice in writing
to such claimant, setting forth the specific reasons for such denial. The notice
shall be written in a -manner  calculated to be understood by the claimant.  The
Administrative Committee shall afford a Participant or Beneficiary,  whose claim
for  benefits  has been  denied,  sixty  (60) days from the date  notice of such
denial is  delivered or mailed in which to appeal the decision in writing to the
Administrative Committee. If the Participant or Beneficiary appeals the decision
in writing within sixty (60) days, the Administrative Committee shall review the
written  comments and any  submissions of the  Participant  or  Beneficiary  and
render its  decision  regarding  the appeal,  all within sixty (60) days of such
appeal.

9.10 Exercise of Stock Rights.

In the event that Qualifying Employer Securities held by the Plan include voting
stock,  or stock or other  securities  with any rights other than voting rights,
the Administrative  Committee shall name, as a Designated Fiduciary,  one of its
members,  or such other person as may consent thereto,  to exercise on behalf of
Participants,  voting or other stock or equity  rights with respect to the stock
contributed to the Plan. The Designated  Fiduciary shall notify each Participant
to whose account any  Qualifying  Employer  Security has been allocated at least
thirty (30) days prior to any  occasion on which such voting or other rights may
be exercised.  Such  notification  shall include all information  distributed to
shareholders  or holders of such other  equities by the Employer  regarding  the
exercise of such  voting or other  rights.  Such  notification  shall  contain a
procedure  under  which  each of such  Participants  shall be able to direct the
Designated  Fiduciary  in the  exercise  of the  voting,  or other  rights.  The
Designated Fiduciary shall be bound by the instructions of each Participant;  if
a Participant gives no instructions to the Designated Fiduciary,  the Designated
Fiduciary  shall not vote such  Participant's  stock or exercise such rights but
shall so notify the trustees to vote such stock or exercise such rights.

                  ARTICLE X - MODIFICATIONS FOR TOP HEAVY PLANS

10.1 Application of Article.

The provisions in this Article X shall take precedence over any other provisions
in the Plan with which they conflict.

10.2 Definitions.

     (a) Top Heavy Plans.

     This Plan shall  constitute  a Top Heavy Plan for a Plan Year if, as of the
     last day of the  preceding  Plan  Year (or in the case of the Plan  Year in
     which  occurs the  effective  date of this Plan,  the last day of such Plan
     Year): (i) the aggregate of the Employer  Accounts of Key Employees exceeds
     sixty  percent  (60%) of the  aggregate  of the  Employer  Accounts  of all
     Employees  under the Plan all  valued  as of the last day of the  preceding
     Plan Year (or in the case of the Plan Year in which  occurs  the  effective
     date of this Plan, the last day of such Plan Year);  or (ii) if the Plan is
     part of a Top Heavy Group.

                                       34
<PAGE>
     (b) Top Heavy Group.

     This Plan  shall be  deemed to be a part of a Top Heavy  Group if the Plans
     which  make up the group of which this Plan is  considered  a part are such
     that, when aggregated, the sum of:

          (i) The  present  value  of the  cumulative  accrued  benefits  of Key
          Employees under all defined benefit plans in the group; and

          (ii) The  cumulative  accrued  benefits  in the Plan  accounts  of Key
          Employees under all defined  contribution plans in the group,  exceeds
          sixty  percent  (60%) of the sum of such amounts for all Employees who
          participate in the Plans of such group.

     The group of Plans of which this Plan shall be considered a part includes:

          (i) All Plans of the Employer in which a Key Employee participates;

          (ii)  All  Plans  which   enable  a  Plan  in  which  a  Key  Employee
          participates  to meet the  qualification  requirements of Code Section
          401(a)(4) or Code Section 410; and

          (iii) All Plans  which the  Employer,  in its  discretion,  decides to
          include,  provided  that the inclusion of such Plan or Plans would not
          prevent the group of Plans from meeting the qualification requirements
          of Code Section 401(a)(4) and Code Section 410.

     (c) Key Employee.

     "Key Employee" means an Employee or former Employee (or his  Beneficiaries)
     who, at any time during the Plan Year or any of the preceding four (4) Plan
     Years, is any of the following:

          (i)  An  officer  of  the   Employer  if  such   individual's   annual
          Compensation  exceeded  fifty percent  (50%) of the dollar  limitation
          under Code Section 415(b)(1)(A).

          (ii) One of the ten (10)  Employees  owning (or  considered  as owning
          within the meaning of Code Section  318) the largest  interests in the
          Employer  if  such  individual's  Compensation  exceeded  one  hundred
          percent   (100%)  of  the  dollar   limitation   under  Code   Section
          415(c)(1)(A).

          (iii) A "five  percent  owner"  (5%) of the  Employer.  "Five  percent
          owner"  (5%)  means any person  who owns (or is  considered  as owning
          within the meaning of Code Section 318) more than five percent (5%) of
          the  outstanding  stock of the Employer or stock  possessing more than
          five percent (5%) of the total  combined  voting power of all stock of
          the Employer.

          (iv) A  "one  percent  owner"(1%)  of the  Employer  receiving  annual
          Compensation from the Employer of more than One Hundred Fifty Thousand
          Dollars ($150,000). "One percent (1%) owner" means any person who owns
          (or is  considered  as owning  within the meaning of Code Section 318)
          more than one percent (1%) of the outstanding stock of the Employer or
          stock  possessing  more than one  percent  (1%) of the total  combined
          voting power of all stock of the Employer.

                                       35
<PAGE>
     In  determining  percentage  ownership  hereunder,   Employers  that  would
     otherwise be aggregated  under Code Section 414(b),  (c), (m) and (o) shall
     be  treated as  separate  Employers.  However,  in  determining  whether an
     individual  receives  compensation  of more than One Hundred Fifty Thousand
     Dollars   ($150,000)   compensation  from  each  Employer  required  to  be
     aggregated under Code Section 414(b),  (c), (m) and (o) shall be taken into
     account.

     (d) Amounts Included for Computation Purposes.

     In  determining,  for the purposes of this Section  10.2,  the amount of an
     Employee's  accrued benefits and account balances,  there shall be included
     therein the present value of all distributions  made within a five (5) year
     period  ending  on  the  date  such   determination   is  made,   including
     distributions  from terminated Plans required to be considered  pursuant to
     Section 10.2(b).  Furthermore, the accrued benefits and account balances of
     any Employee  who is not a Key Employee for the Plan Year in question,  but
     was a Key  Employee  in any  previous  Plan  Year,  shall not be taken into
     consideration  in making any of the  computations  required in this Section
     10.2.  The accrued  benefit of any  individual  who has not  performed  any
     service for the  Employer  within the five year  period  ending on the date
     such  determination is made shall not be taken into account for purposes of
     Section 10.2. Except to the extent provided in regulations of the Secretary
     of the Treasury,  any rollover contributions (or similar transfers) made to
     the Plan after December 31, 1983 shall not be taken into  consideration  in
     making any of the computations required by this Section 10.2.

     (e) Non-Key Employee.

     A "Non-Key Employee" shall mean any Employee who is not a Key Employee.

     (f) Top Heavy Accrual.

     Solely  for the  purpose  of  determining  if the Plan,  or any other  Plan
     included in a Top Heavy Group of which this Plan is a part,  is  top-heavy,
     the accrued  benefit of a  Participant  other than a Key Employee  shall be
     determined under:

          (i) The method,  if any, that uniformly  applies for accrual  purposes
          under all Plans  maintained  by the Employer or by other members of an
          affiliated  service  group (under Code Section  414(m)),  a controlled
          group of corporations  (under Code Section 414(b)),  a group of trades
          or  businesses  under common  control  (under Code Section  414(c)) of
          which the  Employer  is a member and any other  entity  required to be
          aggregated  with the  Employer  pursuant  to  regulations  under  Code
          Section 414(o), or

          (ii) If there is no such method,  as if such benefit  accrued not more
          rapidly than the slowest  accrual rate permitted  under the fractional
          accrual rate of Code Section 411(b)(1)(C).

                                       36
<PAGE>
10.3 Accelerated Vesting.

Unless the Plan  provides for full and  immediate  vesting of Employer  Accounts
upon participation,  then for any Plan Year in which this Plan is deemed to be a
Top Heavy Plan, the vesting schedule  contained in Section 6.2 shall be modified
as follows:

         Total Years for Vesting
      (excluding Years of Service
           prior to effective                             Vested
           date of this Plan)                           Percentage
           ------------------                           ----------
              Less than 2                                    0%
                   2                                        20%
                   3                                        40%
                   4                                        60%
                   5                                        80%
               6 or more                                   100%

Should this Plan not be deemed to be a Top Heavy Plan after  previously being so
categorized,  the  vesting  schedule  contained  in Section  6.2 shall  again be
effective except that the vested percentage  attained by Participants  shall not
be reduced thereby and Participants  with three (3) or more Years of Service for
Vesting  shall have the right to select the vesting  schedule  under which their
vested Accrued Benefit will be determined.

10.4 Minimum Contributions.

For any Plan  Year in which  this Plan is  determined  to be a  Top-Heavy  Plan,
either: (i) a minimum Employer contribution shall be made, pursuant to this Plan
or another defined contribution plan maintained by the Employer,  to the account
of each non-Key  Employee  (except those who are separated from service with the
Employer at the end of the Plan Year); or (ii) a minimum  non-integrated benefit
must be provided to each non-Key  Employee  (except those who are separated from
service  with the  Employer at the end of the Plan Year),  pursuant to a defined
benefit plan maintained by the Employer.

For the  purposes  of the first  sentence  of this  Section  10.4,  the  minimum
Employer  contribution  provided to each non-Key  Employee (except those who are
separated  from  service with the Employer at the end of the Plan Year) shall be
equal  to  three  percent  (3%) of such  non-Key  Employee's  Compensation.  If,
however,   the  Employer   contribution,   under  this  and  any  other  defined
contribution  plan required to be included in the Top-Heavy Group and maintained
by the  Employer,  for any Key  Employee  for such Plan Year is less than  three
percent  (3%) of such Key  Employee's  total  Compensation  not in excess of Two
Hundred  Thousand  Dollars  ($200,000) (for Plan Years  beginning  before 1989),
then,  the  Employer  contribution  to each  Participant  (except  those who are
separated  from  service  with the  Employer  at the end of the Plan Year) shall
equal the amount which results from multiplying such Participant's  Compensation
times the highest  contribution rate of any Key Employee covered by the Plan and
shall include amounts elected to be deferred by the Key Employee  pursuant to an
Code Section 401(k) provision.

For the  purposes  of the first  sentence  of this  Section  10.4,  the  minimum
non-integrated benefit provided by the Employer to each non-Key Employee (except
those who are  separated  from  service with the Employer at the end of the Plan

                                       37
<PAGE>
Year) is an amount, which when expressed as an annual retirement benefit,  shall
be no less than two  percent  (2%) of such  non-Key  Employee's  average  annual
Compensation for his five (5) highest  consecutive years of service,  multiplied
by the  Employee's  years of service with the  Employer,  not to exceed ten (10)
years.  For the purposes of the  preceding  sentence,  years of service with the
Employer shall not include years of service completed during any Plan Year which
begins before January 1, 1984, or years of service  completed during a Plan Year
for which the Man is not a Top-Heavy  Plan.  For the  purposes  of this  Section
10.4,  the  minimum  benefit  provided  above shall be computed in the form of a
single life annuity, with no ancillary benefits,  beginning at Normal Retirement
Age.

For the purposes of this Article X,  "Compensation"  shall have the same meaning
as it does  throughout the Plan;  provided that it shall include such additional
compensation as is required to meet the requirements of Code Section 415(c)(3).

The minimum  allocation  required  pursuant to this  section  shall be made even
though,  under other Plan  provisions,  a  participant  would not  otherwise  be
entitled to receive an  allocation,  or would have received a lesser  allocation
for the  year  because  of such  participant's  failure  to  complete  a Year of
Service.

10.5 Limitation on Compensation Taken into Account Under Plan.

For any Plan Year prior to Plan Years beginning before January 1, 1989, in which
this  Plan is  deemed  to be a Top Heavy  Plan the  definition  of  Compensation
contained in Section 2.5 shall  exclude  amounts in excess of one hundred  fifty
thousand dollars ($150,000).

10.6 Modification of Defined Benefit and Defined Contribution Plan Fraction.

For any Plan  Year in which  the Plan is  deemed  to be a Top  Heavy  Plan,  the
denominators of the defined  benefit plan fraction and the defined  contribution
plan fraction  contained in Section  5.4(c) (if such Section is included in this
Plan)  shall  be  deemed  to  be  modified   by   substituting   1.0  for  1.25.
Notwithstanding  the  above,  if this Plan would not be deemed to be a Top Heavy
Plan if ninety percent (90%) were substituted for sixty percent (60%) in Section
10.2 and if the Employer  provides  benefits and/or makes  contributions  to the
Employer Accounts of non-Key Employees who participate in defined benefit and/or
defined contribution plans maintained by the Employer, in amounts at least equal
to that which would be required by Section 10.4 after  substituting four percent
(4%) for three percent (3%) in the second paragraph thereof, and by substituting
three percent (3%) for two percent (2%) in the third paragraph thereof, then the
reduction in the defined benefit plan fraction and the defined contribution plan
fraction as set forth in the preceding sentence, shall not be made.

                     ARTICLE XI - AMENDMENT AND TERMINATION

11.1 Rights to Suspend or Terminate Plan.

It is the present intention of the Employer to maintain this Plan throughout its
corporate existence. Nevertheless, the Employer reserves the right, at any time,
to discontinue  or terminate the Plan, to terminate the Employer's  liability to
make further contributions to this Plan, to suspend contributions for a fixed or
indeterminate  period of time.  In any event,  the  liability of the Employer to
make  contributions  to this Plan shall  automatically  terminate upon its legal
dissolution or termination, upon its adjudication as a bankrupt, upon the making
of a general  assignment  for the  benefit of  creditors,  or upon its merger or
consolidation with any other corporation or corporations.

                                       38
<PAGE>
11.2 Successor Corporation.

In the event of the termination of the liability of the Employer to make further
contributions to this Plan, the Employer's liability may be assumed by any other
corporation  or  organization   which  employs  a  substantial   number  of  the
Participants of this Plan. Such assumption of liability shall be expressed in an
agreement  between such other corporation or organization and the Trustees under
which such other  corporation or  organization  assumes the  liabilities of this
Trust with respect to the Participants employed by it.

11.3 Amendment.

To provide for contingencies which may require the clarification,  modification,
or amendment of this Plan, the Employer reserves the right to amend this Plan at
any time. The Employer,  however, shall not have the right to amend this Plan in
any way which would deprive any  Participant of the right to receive his Accrued
Benefits  under the Plan, or which would alter the basic purpose of the Plan, or
which would give the Employer any rights in the Trust Fund.

Each Participant  having at least three Years of Service for Vesting at the time
of the adoption of any amendment  changing any vesting  schedule  under the Plan
shall  have the right to elect at any time,  but no later than 60 days after the
later  of:  (a) the date the  amendment  is  adopted;  (b) the date on which the
amendment  is  effective;  or (c) the date on  which  the  Participant  is given
written notice the amendment,  to have his vested percentage  computed under the
Plan without regard to such amendment.

11.4 One Hundred Percent (100%) Vesting on Termination of Plan.

Upon  termination or partial  termination of the Plan and Trust by formal action
of the Employer or for any other  reason,  or if Employer  contributions  to the
Plan and Trust are permanently  discontinued  for any reason,  each  Participant
directly  affected by such action shall be one hundred  percent (100%) vested in
the amount  allocated to the accounts of each such  Participant,  and payment to
such Participant  shall be made in cash as soon as practicable after liquidation
of the assets of the Trust.

11.5 Plan Merger or Consolidation.

In the case of any merger or  consolidation  with,  or transfer of any assets or
liabilities  to, any other Plan' each  Participant in this Plan must be entitled
to receive (if the  surviving  Plan is then  terminated)  a benefit  immediately
after the merger,  consolidation,  or transfer which is equal to or greater than
the  benefit  he would have been  entitled  to  receive  immediately  before the
merger, consolidation, or transfer (if this Plan had terminated).

                           ARTICLE XII - MISCELLANEOUS

12.1 Laws of California to Apply.

The Plan provisions of this document shall be construed according to the laws of
the State of California, to the extent Federal laws do not control. The situs of
the Trust will be in the State of California.  Its validity,  construction,  and
all rights  under the Plan and Trust  shall be  governed  by ERISA  and,  to the
extent  not  preempted,  by the laws of  California.  If any  provisions  of the
Agreement are invalid or unenforceable,  the remaining  provisions thereof shall
continue to be fully effective.

                                       39
<PAGE>
12.2 Participant Cannot Transfer or Assign Benefits.

None of the benefits,  payments,  proceeds, claims, or rights of any Participant
hereunder shall be subject to any claim of any creditor of the Participant,  nor
shall any Participant have any right to transfer, assign, encumber, or otherwise
alienate,  any of the  benefits or proceeds  which a  Participant  may expect to
receive, contingently or otherwise under this Plan.

Notwithstanding any other provisions of this Section 12.2, the Trustees may make
distributions  pursuant to a qualified  domestic  relations order (as defined in
Code Section 414(p)), provided that the Plan Administrator has properly notified
the Participant and any alternate payee of the order and has determined that the
order is a qualified  domestic  relations  order. The Plan  Administrator  shall
adopt reasonable procedures to determine the qualified status of such orders and
to administer distributions thereunder.  Notwithstanding any restrictions on the
time of distribution which would otherwise apply under this Plan,  distributions
with  respect to a qualified  domestic  relations  order may be made at any time
required by the order.

12.3 Right to Perform Alternative Acts.

In the  event  it  becomes  impossible  for  the  Employer,  the  Administrative
Committee  or the  Trustees to perform any act  required by this Plan,  then the
Employer,  the  Administrative  Committee  or  the  Trustees  may  perform  such
alternative  act which most  clearly  carries out the intent and purpose of this
Plan.

12.4 Reversion of Contributions Under Certain Circumstances.

If this Plan is not  initially  approved and  qualified by the Internal  Revenue
Service as meeting the  requirements  of Code  Section 401 and Code Section 501,
the Employer may, at its election, either:

          (a)  Cause  the  Trustees  to  return  to  the  Employer  any  amounts
     previously  contributed by the Employer to the Trust and the  Participants,
     if any amounts have been contributed by them, and immediately terminate the
     Plan; or

          (b) Effect such  amendments to the Plan as are necessary to obtain the
     approval and qualification of the Plan by the Internal Revenue Service.

All  contributions  made pursuant to Article IV are conditioned on deductibility
of such  contributions  under Code Section 404. To the extent that the deduction
under Code Section 404 for any year is  disallowed,  the  contribution  shall be
returned  to  the  Employer  within  one  (1)  year  after  disallowance  of the
deduction.

If a contribution is made by an Employer by a mistake of fact, the  contribution
may be  returned  to the  Employer  within one (1) year after the payment of the
contribution.

Notwithstanding  the  above,  earnings  attributable  to  amounts  described  in
paragraphs  two and three of this  Section  12.4  shall not be  returned  to the
Employer; losses attributable to such amounts shall reduce the amount returned.

12.5 Plan Administrator Agent for Service of Process.

The Plan  Administrator  is designated agent to receive service of legal process
on behalf of the Plan.

                                       40
<PAGE>
12.6 Filing Tax Returns and Reports.

If the  Trustees are not a corporate  fiduciary,  the Plan  Administrator  shall
prepare,  or cause to have  prepared,  all tax  returns,  reports,  and  related
documents,  except as otherwise specifically provided in this Plan or unless the
Administrative  Committee  provides to the contrary in the manner  prescribed in
Section 8.4.

12.7 Indemnification.

The  Employer  agrees to  indemnify  all  Employees  who serve as members of the
Administrative  Committee or who serve as Trustee against all liability  arising
in connection with their duties under the Plan, except that this indemnification
shall not  include  acts of  embezzlement,  or  diversion  of Trust Funds by the
Employee, nor shall it include acts of gross negligence.

The Employer  shall  indemnify  and hold  harmless the  Trustees,  its officers,
Employees,  agents,  successors and assigns  against all  liabilities,  demands,
claims, actions, losses, taxes, expenses (including reasonable attorney's fees),
both  direct and  indirect,  arising  out of (1) acts or  omissions  to act with
respect to the Plan by persons unrelated to the Trustees ("unrelated  persons"),
(2) the  Trustee's  action or inaction with respect to the Plan  resulting  from
reliance on the actions or inaction of unrelated persons,  including  directions
to  invest  or  otherwise  deal with Plan  assets,  or (3) any  violation  by an
unrelated persons of the provisions of ERISA or the regulations thereunder.  The
foregoing  indemnity shall not apply if the actions or omissions of the Trustees
result from the Trustees' willful misconduct or gross negligence.

12.8 Number and Gender.

When  appropriate the singular as used in this Plan shall include the plural and
vice versa; and the masculine shall include the feminine.

12.9 Military Service.

Notwithstanding  any  provision  of this  Plan to the  contrary,  contributions,
benefits and Service credit with respect to qualified  military  service will be
provided  in  accordance  with  Section  414(u) of the  Internal  Revenue  Code.
Therefore,  as of the  effective  date of this Plan or such later date as may be
applicable  to  this  Plan  under  Section  8(h)(2)  of the  Uniformed  Services
Employment And Reemployment  Rights Act of 1994 (USERRA),  an Employee,  who was
absent from the  Employee's  position of  employment by reason of service in the
uniformed  services  and who is  reemployed,  as these terms are used in USERRA,
shall be  treated as not having  incurred a break in service  with the  Employer
maintaining  the Plan by reason of such person's period or periods of service in
the uniformed services. Each period served by a person in the uniformed services
shall, upon reemployment  under USERRA, be deemed to constitute service with the
Employer   maintaining   the   Plan  for  the   purpose   of   determining   the
nonforfeitability  of the  person's  Accrued  Benefit  and  for the  purpose  of
determining  the accrual of benefits under the Plan, all to the extent  required
by and as provided under USERRA.

                           ARTICLE XIII - EXEMPT LOANS

13.1 Use of Proceeds.

The proceeds of an Exempt Loan must be used within a reasonable time after their
receipt by the Plan only for any or all of the following purposes:

                                       41
<PAGE>
          (a) To acquire Qualifying Employer Securities;

          (b) To repay such Exempt Loan;

          (c) To repay a prior Exempt Loan.

If the  proceeds of a loan are used to repay an Exempt  Loan,  the new loan must
constitute an Exempt Loan.

13.2 Interest Rate.

The interest rate of any loan to the Plan, including an Exempt Loan, must not be
in excess of a reasonable rate of interest. All other factors will be considered
in determining a reasonable rate of interest,  including the amount and duration
of the loan, the security and guaranty (if any) involved, the credit standing of
the Plan and the  guarantor  (if any),  and the  interest  rate  prevailing  for
comparable loans, including a variable interest rate if reasonable.

13.3 Non-recourse.

An Exempt Loan must be without recourse against the Plan. The only assets of the
Plan that may be given as collateral on an Exempt Loan are  Qualifying  Employer
Securities which were either: (i) acquired with the proceeds of the Exempt Loan;
or (ii) were used as  collateral on a prior Exempt Loan repaid with the proceeds
of the current Exempt Loan. No person  entitled to payment under the Exempt Loan
shall have any right to assets of the Plan other than:

          (a) Collateral given for the Exempt Loan;

          (b)  Contributions  (other than  contributions of Qualifying  Employer
     Securities)  that are made  under the Plan to meet the  obligations  of the
     Exempt Loan; and

          (c) Earnings  attributable  to such  collateral  and the investment of
     such contributions

13.4 Limitations on Payments.

Payments made with respect to an Exempt Loan by the Plan during a Plan Year must
not  exceed  an  amount  equal  to the sum of such  contributions  and  earnings
received  during  or prior to the Plan Year less  such  payments  in prior  Plan
Years. Such  contributions and earnings shall be accounted for separately by the
Employer in the books of account of the Plan until the Exempt Loan is repaid.

13.5 Forfeiture of Qualifying Employer Securities.

All Qualifying  Employer  Securities acquired with the proceeds of a loan from a
"disqualified  person",  whether they are pledged as collateral for such loan or
not, shall be held in a suspense  account and shall be removed from such account

                                       42
<PAGE>
and be  allocated to the Employer  Accounts of  Participants  at the end of each
Plan Year to the extent  paragraph  (h) of Section 8.11 provides for the release
of encumbered  securities.  Income earned from securities held in suspense shall
be deemed to be the income of the Plan and shall not be held in suspense  unless
such income has been pledged as collateral  for the loan.  Should a portion of a
Participant's Employer Account be forfeited, Qualifying Employer Securities held
in  suspense  for  such  Participant  pursuant  to this  paragraph  may  only be
forfeited  after all other  assets in the  Participant's  Employer  Account  are
forfeited. If interests in more than one class of Qualifying Employer Securities
have been allocated to the Participant's  Employer Account, the Participant must
be treated as  forfeiting  the same  proportion of each such class of Qualifying
Employer Securities.

13.6 Limitation on Future Obligation.

The Plan shall not obligate  itself to acquire  Qualifying  Employer  Securities
from a particular  security  holder at an indefinite  time  determined  upon the
happening of an event such as the death of the security  holder.  However,  this
shall not  prevent  the Plan from  providing  for the  issuance  of  options  in
accordance with Treasury Regulation Sections  54.4975-7(b)(10),  (11), and (12).
In the  event  of  default  upon an  Exempt  Loan,  the  value  of  Plan  assets
transferred  in  satisfaction  of the  Exempt  Loan may not exceed the amount of
default.  If the lender is a  disqualified  person (as  defined in Code  Section
4975(e)(2)),  the Exempt  Loan must  provide  for a transfer of Plan assets upon
default  only  upon and to the  extent  of the  failure  of the Plan to meet the
payment  schedule of the Exempt Loan.  For purposes of this  Section  13.6,  the
making of a guaranty does not make a person a lender.

               ARTICLE XIV - LIMITATIONS ON MATCHING CONTRIBUTIONS

14.1. Percentage Limitation on Matching Contributions.

Notwithstanding  anything in the Plan to the contrary,  for each Plan Year,  the
Average  Contribution  Percentage of Participants  must satisfy either the basic
limitation or the alternative limitation stated in this Article. For purposes of
this Article:

          (a) "Actual Deferral  Percentage"  shall mean the ratio (calculated to
     the  nearest   one-hundredth   of  one  percent)  for  a  Plan  Year  of  a
     Participant's elective deferral contributions determined in accordance with
     rules under any cash or deferred arrangement maintained by the Employer.

          (b)  Average  Actual  Deferral   Percentage  shall  mean  the  average
     (expressed  as a  percentage)  of the Actual  Deferral  Percentages  of the
     Participants in a group  determined in accordance with rules under any cash
     or deferred arrangement maintained by the Employer.

          (c) "Average Contribution Percentage(s)" shall mean the average of the
     Contribution Percentages of the eligible Participants in a group.

          (d) "Contribution  Percentage" shall mean the ratio for a Plan Year of
     a Participant's  Matching  Contributions  and any other  contributions  the
     Employer  elects  to  take  into  account  in  computing  the  Contribution
     Percentage  to the  Participant's  Compensation  for  the  Plan  Year.  The
     Contribution  Percentage of a Participant who has no Matching Contributions
     made on his or her behalf and for whom the Employer elects to take no other
     contributions into account shall be zero (0). A Participant's  Contribution
     Percentage shall be computed according to the following rules:

                                       43
<PAGE>
               (i) Matching Contributions made on the Participant's behalf shall
               be taken  into  account  for a Plan Year  only if those  Matching
               Contributions are allocated to the  Participant's  Account during
               that Plan Year and paid to the Trust no later than the end of the
               twelfth (12th) month following the end of the Plan Year.

               (ii) As to a  Highly  Compensated  Employee  who is  eligible  to
               participate  in two (2) or more  plans  of an  Employer  to which
               Matching  Contributions  are made (other  than an employee  stock
               ownership plan as defined in Code section  4975(e)(7)),  all such
               contributions made on behalf of that Highly Compensated  Employee
               must be  aggregated  for  purposes  of  determining  that  Highly
               Compensated Employee's Contribution Percentage.

               (iii) If the  Employer  maintains  two (2) or more plans that are
               subject to the  requirements  of Code section  401(m),  and those
               plans are considered as one (1) plan for purposes of Code section
               401(a)(4) or section 410(b),  all those plans shall be aggregated
               and  treated  as one (1) plan for  purposes  of  determining  the
               Contribution Percentage of a Participant.

          (e) "Excess Aggregate  Contributions" shall mean, as to any Plan Year,
     the excess of:

               (i) The aggregate amount of the Matching Contributions  allocated
               to a Highly Compensated Employee for a Plan Year, over

               (ii)  The  maximum  amount  of  such  contributions  that  may be
               allocated to the Highly  Compensated  Employee without  violating
               the limitations stated in Article 5 and this Article. The maximum
               amount that may be  allocated  to a Highly  Compensated  Employee
               shall be determined by ranking  Highly  Compensated  Employees by
               Contribution Percentage in descending order and then reducing the
               Matching   Contributions   from  the   Accounts   of  the  Highly
               Compensated  Employees  starting  with the  highest  Contribution
               Percentage to the extent required to:

                    (a)  Enable the Plan to satisfy  the  limitations  stated in
                    Article 5 and this Article, or

                    (b) Cause that Highly  Compensated  Employee's  Contribution
                    Percentage  to  equal  the  Contribution  Percentage  of the
                    Highly   Compensated   Employee   with  the   next   highest
                    Contribution Percentage.

          This  process  shall  be  repeated   until  the  Plan   satisfies  the
     limitations stated in Article 5 and this Article.

          In no event shall the amount of Excess Aggregate  Contributions exceed
     the amount of Matching Contributions made on behalf of a Highly Compensated
     Employee for a Plan Year.

                                       44
<PAGE>
         (f) "Matching  Contribution"  shall mean any  contribution  to the Plan
      designated  as such by the Employer  which  matches,  in whole or in part,
      elective  deferral  contributions  made on behalf of an Employee under any
      cash or deferred arrangement maintained by the Employer.

14.2. Basic Limitation.

The Average  Contribution  Percentage  of Highly  Compensated  Employees who are
eligible to  participate  in the Plan (whether or not those  Employees  elect to
make elective deferrals under any cash or deferred arrangement maintained by the
Employer) shall not exceed for the Plan Year the Average Contribution Percentage
of  Nonhighly-Compensated  Employees who are eligible to participate in the Plan
(whether or not those Employees elect to make elective  deferrals under any cash
or deferred arrangement maintained by the Employer) for the Plan Year multiplied
by 1.25.

14.3. Alternative Limitation.

The Average  Contribution  Percentage  of Highly  Compensated  Employees who are
eligible to  participate  in the Plan (whether or not those  Employees  elect to
make elective deferrals under any cash or deferred arrangement maintained by the
Employer)  shall not exceed the Average  Contribution  Percentage  of  Nonhighly
Compensated  Employees who are eligible to  participate  in the Plan (whether or
not those Employees elect to make elective  deferrals under any cash or deferred
arrangement  maintained by the  Employer)  for the Plan Year  multiplied by 2.0,
provided  that  the  Average  Contribution   Percentage  of  Highly  Compensated
Employees shall not exceed the Average Actual  Deferral  Percentage of Nonhighly
Compensated Employees by more than two (2) percentage points.

14.4. Multiple Use Limitation.

If both the Average Actual Deferral percentage test and the Average Contribution
Percentage test do not satisfy the basic limitation  stated above, and if one or
more  Highly  Compensated   Employees  are  eligible  to  have  Salary  Deferral
Contributions  made  on  their  behalf  in  any  cash  or  deferred  arrangement
maintained  by the Employer  and to have  Matching  Contributions  made on their
behalf  under this  Plan,  then the sum of the Actual  Deferral  Percentages  of
Highly  Compensated  Employees plus the sum of the  Contribution  Percentages of
Highly Compensated Employees shall not exceed the greater of:

          (a) The sum of:

                    (i)  1.25  times  the   greater   of  the  Actual   Deferral
                    Percentages     or      Contribution      Percentages     of
                    Nonhighly-Compensated Employees, plus

                    (ii) Two (2) percentage points plus the lesser of the Actual
                    Deferral   Percentages   or   Contribution   Percentages  of
                    Nonhighly Compensated Employees; or

          (b) The sum of:

                    (i) 1.25 times the lesser of the Actual Deferral Percentages
                    or   Contribution   Percentages   of   Nonhighly-Compensated
                    Employees, plus

                    (ii)  Two (2)  percentage  points  plus the  greater  of the
                    Actual Deferral  Percentages or Contribution  Percentages of
                    Nonhighly Compensated Employees.

If the multiple use  limitation  stated  above is exceeded,  the  Administrative
Committee  shall  determine  the maximum  percentage  to be used in place of the
calculated  percentage  for all Highly  Compensated  Employees that would reduce
either or both the Actual Deferral Percentage or Contribution Percentage for the
Highly Compensated Employees to satisfy the multiple use limitation.  Any excess
shall  be  handled  in the same  manner  that  Excess  Contributions  or  Excess
Aggregate Contributions are handled.

                                       45
<PAGE>
14.5. Correction of Average Contribution Percentage Test.

The  Administrator  shall  determine  the  Excess  Aggregate   Contributions  in
accordance with paragraph 14.1 and either

          (a) Cause those amounts, along with the income or loss attributable to
     those amounts, to be forfeited,  if not vested under the terms of the Plan,
     or, if vested, distributed no later than the last day of the Plan Year;

          (b) Contribute an additional  discretionary  Matching  Contribution on
     behalf of each Participant who is a Nonhighly  Compensated Employee so that
     the limitations in this Article 14 are met;

          (c) Cause the Excess Aggregate  Contribution  amounts,  along with the
     income or loss  attributable  to those  amounts,  to be  reallocated to the
     accounts of Nonhighly  Compensated Employees having the lowest Contribution
     Percentage for the Plan Year so that the limitations in this Article 14 are
     met; or

          (d) Use any combination of (a), (b) and (c) to satisfy the limitations
     in this Article 14. Any  forfeiture  or  distribution  shall be made on the
     basis  of  the  respective  portion  of  the  amount  of  Excess  Aggregate
     Contributions  attributable  to  each  Highly  Compensated  Employee  whose
     Matching  Contributions  Account  received an allocation  for the preceding
     Plan Year.

14.6. Calculation of Income.

The  income  or loss  allocable  to  Excess  Aggregate  Contributions  shall  be
calculated in accordance with the method used by the Plan for allocating  income
to  Participants'  Accounts  generally.  That method  shall be  reasonable,  not
violate Code section 401(a)(4),  be applied  consistently to the Accounts of all
Participants,  and be used for  corrective  distributions  under the  Plan.  The
income or loss allocable to Excess Aggregate Contributions shall not include the
income or loss for the period  between the end of the taxable  year and the date
of distribution.

14.7. Deadline for Distribution.

Excess  Aggregate  Contributions  and income  allocable to those Excess Year for
which  those  Excess  Aggregate   Contributions   were  made.  Excess  Aggregate
Contributions shall be distributed from the Participant's  Matching Contribution
Account.

14.8. Treatment as Annual Additions.

Excess  Aggregate  Contributions  shall be  treated  as Annual  Additions  under
Article 5.

14.9. Compliance with Treasury Regulations.

The Plan shall  satisfy  the  requirements  of Code  section  401(m)(2)  and the
regulations under that section;  those  requirements are hereby  incorporated by
reference.

                                       46
<PAGE>
IN WITNESS  WHEREOF,  the parties have executed this  agreement this 18th day of
November, 1999.

WITNESS                                  EMPLOYER
-------                                  --------

                                         MCB FINANCIAL CORPORATION

Nancy Boatright                          /s/ Charles 0. Hall
                                         ---------------------------------------
                                         President

WITNESS                                  TRUSTEE
-------                                  -------

                                         /s/ Charles 0. Hall
                                         ---------------------------------------

                                         /s/ Timothy J.. Jorstad
                                         ---------------------------------------

                                         /s/ Gary T. Ragghianti
                                         ---------------------------------------

                                       47Exhibit 10(b)(7)

                               METRO COMMERCE BANK

                                TRIPLE NET LEASE

                               650 TOWNSEND STREET
                                SAN FRANCISCO, CA

                                TABLE OF CONTENTS

1.   SALIENT LEASE TERMS                                                       1
2.   DEFINITIONS                                                               3
3.   PREMISES                                                                 10
4.   TERM                                                                     12
5.   PRE-TERM POSSESSION                                                      14
6.   DELAY IN DELIVERY OF POSSESSION                                          15
7.   MINIMUM RENT                                                             15
8.   ADDITIONAL RENT                                                          15
9.   ACCORD AND SATISFACTION                                                  18
10.  SECURITY DEPOSIT                                                         18
11.  USE                                                                      19
12.  COMPLIANCE WITH LAWS AND REGULATIONS                                     20
13.  SERVICE AND EQUIPMENT                                                    27
14.  WASTE                                                                    29
15.  ALTERATIONS                                                              29
16.  PROPERTY INSURANCE                                                       31
17.  INDEMNIFICATION, WAIVER OF CLAIMS AND SUBROGATION                        32
18.  LIABILITY INSURANCE                                                      34
19.  INSURANCE POLICY REQUIREMENTS                                            34
20.  LESSEE INSURANCE DEFAULT                                                 35
21.  FORFEITURE OF PROPERTY AND LESSOR'S LIEN                                 35
22.  MAINTENANCE AND REPAIRS                                                  35
23.  DESTRUCTION                                                              37
24.  CONDEMNATION                                                             38
25.  ASSIGNMENT AND SUBLETTING                                                40
26.  ABANDONMENT                                                              44
27.  ENTRY BY LESSOR                                                          44
28.  SIGNS                                                                    44
29.  DEFAULT                                                                  45
30.  REMEDIES UPON DEFAULT                                                    45
31.  BANKRUPTCY                                                               48
32.  SURRENDER OF LEASE                                                       51
33.  LESSOR'S EXCULPATION                                                     51
34.  ATTORNEYS' FEES                                                          52
35.  NOTICES                                                                  52
36.  SUBORDINATION                                                            53
37.  ESTOPPEL CERTIFICATES.                                                   54
38.  WAIVER                                                                   54
39.  HOLDING OVER                                                             55
40.  SUCCESSORS AND ASSIGNS                                                   55
41.  TIME                                                                     55
42.  EFFECT OF LESSOR'S CONVEYANCE                                            55
43.  COMMON AREAS                                                             55
44.  TRANSFER OF SECURITY                                                     56
45.  LATE CHARGES                                                             56
46.  CORPORATE AUTHORITY                                                      56
47.  MORTGAGEE PROTECTION                                                     56
48.  MISCELLANEOUS PROVISIONS                                                 57
49.  WAIVER OF CALIFORNIA CODE SECTIONS                                       59
50.  SHUTTLE SERVICE                                                          60
<PAGE>
THIS LEASE is dated for reference purposes only this 17th day of December, 1999.

                             1. SALIENT LEASE TERMS

     1.1   Rent Payment:         ZORO, LLC
                                 650 Townsend Street
                                 San Francisco, CA 94103
                                 Attn.: Building Management Office
                                 Fax No.: (415) 487-4056

     1.2   Parties and Notice    Lessor: ZORO, LLC,
           Address:                      a California limited liability company
                                         650 Townsend Street
                                         San Francisco, CA 94103
                                         Attn.: Building Management Office
                                         Fax No.: (415) 487-4056

                                 Lessee: METRO COMMERCE BANK,
                                         a California Corporation
                                 (if more than one party, then the obligations
                                 hereunder shall be joint and several.)

                                 Until commencement of the Term:
                                         METRO COMMERCE BANK
                                         1248 Fifth Avenue
                                         San Rafael, CA 94901
                                 After commencement of the Term, Notices shall
                                 be sent to Lessee at the Leased Premises.
                                                                  (Section 35.1)

     1.3   Premises:             (A) Name and Location of Complex:
                                     Townsend Center
                                     650 Townsend Street
                                     San Francisco, CA 94103
                                 (B) Leased Premises: Ground Floor- (a portion
                                     of the ground floor space with entry to
                                     lobby)

                                     Usable Area: 2,975 square feet
                                     Rentable Area: 3,570 square feet

     1.4   Term:                 (A) Estimated Delivery Date: January 1, 2000
                                 (B) Initial Term: Ten (10) years from
                                     Commencement Date
                                 (C) Renewal Term; Number: Two (2) successive
                                     five (5) year terms
                                                                   (Section 4.1)

                                        1
<PAGE>
     1.5   Rent:                 (A) Minimum Rent:

                                 Annual Rental              Monthly Rental
                                 -------------              --------------
                                 Years 1-5      $107,100    $ 8,925.00
                                 Years 6-10     $140,625    $11,718.75

                                 First and Second Renewal Terms at Fair Market
                                 Rental
                                                                   (Section 7.1)
                                 (B) Advance Rent:

                                     Eight Thousand Nine Hundred Twenty-Five
                                     Dollars ($8,925)
                                                                   (Section 7.2)
                                 (C) ATM Rent in addition to Minimum Rent:

                                 Years During Term    Annual Rent   Monthly Rent
                                 -----------------    -----------   ------------
                                 Years 1-5            $12,000       $1,000

                                 Years 6-10           $15,000       $1,250

                                 First Renewal Term   $20,000       $1,667

                                 Second Renewal Term  $25,000       $2,083

     1.6   Security Deposit:     Twenty Thousand Six Hundred Forty-Three and
                                 75/xx Dollars
                                 ($20,643.75)
                                                                  (Section 10.1)
     1.7   Use:                  Retail, banking, and office use
                                                                  (Section 11.1)

     1.8   Initial Pro Rata      0.53% (3,570/672,788 rsf)
           Percent:                                                (Section 2.1)
                                                                  (Section 16.3)

     1.9   Base Operating        (A) Base Operating Cost Year: 2000
           Cost for the          (B) Base Tax Year:            1999-2000
           Complex:                                                (Section 8.2)
                                                                  (Section 16.3)

     1.10  Real Estate           Cushman & Wakefield of California, Inc. and
           Brokers:              Polatnick Properties (Lessor's Brokers)
                                 Grubb & Ellis (Lessee's Broker)
                                                                 (Section 48.14)

                                       2
<PAGE>
     1.11  Rentable Area of      672,788 square feet
           Building at
           Commencement:

     1.12  Parking               Two (2) stalls

     1.13  Contents:             This Lease consists of.
                                 Pages 1 through 61
                                 Sections 1 through 50
                                 Addenda (if any)
                                 Exhibits:
                                   A - Legal Description of Complex
                                   B - Plan of the Complex
                                   C - Floor Plan of the Leased Premises
                                   D - Work Letter Agreement
                                   E - Acknowledgment of Commencement
                                   F - Rules and Regulations
                                   G - Building Standards
                                   H - Janitorial Specifications
                                   I - Subordination Agreement
                                   J - Letter of Credit Terms
                                   K - Sign Exhibit
                                   L - Estoppel Certificate

                                 2. DEFINITIONS

     2.1 The terms  defined in this  Article 2 shall,  for all  purposes of this
Lease and all agreements supplemental hereto, have the meanings herein specified
unless expressly stated otherwise.

          "Alterations"  Means  any  alterations,   additions,  improvements  or
installations performed by Lessee after the Commencement Date.

          "Atrium"  means  the  central  Atrium  on  floors 2  through  6 of the
Building so identified on Exhibits B and C, if applicable.

          "Base Building Work" is defined in the Work Letter Agreement, attached
hereto as Exhibit D.

          "Base  0perating  Cost" means the sum of the costs for Base  Operating
Costs and Taxes for the years specified in Section 1.9 hereof.

          "BOMA"  means the  standards  of  measurement  adopted by the Building
Owners and Managers Association,  American National Standard, ANSI/BOMA 2.65.1 -
1996 ("BOMA") as modified by Lessor for uniform use in the Complex.

          "Building"   shall  mean  the  structure  which  contains  the  Leased
Premises.

          "Building  Standards" shall mean Lessor's standard  specifications for
construction in the Building as set forth in Exhibit G, attached hereto,  and as
may be established by Lessor from time to time.

                                       3
<PAGE>
          "Commencement Date" shall mean the earlier of the following dates:

               (i) The day upon which  Lessee  opens for  business in the Leased
Premises; or

               (ii) The date upon which the Tenant  Improvements,  including the
Lessee's  Work  (as  herein  defined),  have  been  substantially  completed  as
determined by Lessor's project architect; or

               (iii) Ninety (90) days  following  the  Delivery  Date (as herein
defined).

          "Common Areas" shall mean all areas and facilities  outside the Leased
Premises  within  the  exterior  boundaries  of the  Complex of which the Leased
Premises  form a part,  that are provided and  designated by Lessor from time to
time for the  general  use and  convenience  of Lessee  and of other  tenants of
Lessor  having the common use of such  areas,  and their  respective  authorized
representatives  and  invitees.   Common  Areas  include,   without  limitation,
corridors,  stairways, elevator shafts, janitor rooms, driveways, parking areas,
and landscaped  areas all as generally  described on Exhibit B, attached hereto.
Exhibit B is tentative and Lessor reserves the right to make alterations thereto
from time to time.  Other areas may be designated by Lessor from time to time as
for the exclusive use of certain lessees and shall cease being Common Areas.

          "Complex" is the real  property of which the Leased  Premises  forms a
part,  including,  but not  limited  to,  the  Building,  parking  facility  and
landscaping,  which  property  is  described  with  particularity  in Exhibit A,
attached hereto and made a part hereof by reference.

          "Delivery Date" shall mean the earlier of the following dates: (i) the
date upon  which  Lessee  takes  possession  of the  Leased  Premises  (provided
possession  shall  not mean  Lessee's  possession  of and  entry  to the  Leased
Premises for the purpose set forth in Section 5. 1), or (ii) the date upon which
Lessor's  Work  with  respect  to the  Leased  Premises  has been  substantially
completed  in  accordance  with  Exhibit  D;  provided,  however,  in the  event
completion  of Lessor's Work is delayed by Lessee's Work or other acts of Lessee
or its agents ("Lessee  Delay") any such Lessee Delay shall  thereupon  effect a
postponement  of the date at which  Lessor is  obliged  to  deliver  the  Leased
Premises to Lessee by the number of days of Lessee Delay.  However, the Delivery
Date and the  Commencement  Date as would  otherwise be  established  had Lessee
Delay not occurred shall not be postponed by the number of days of Lessee Delay.

          "Force Majeur" shall mean event(s)  beyond the  reasonable  control of
the obligated party such as, for example only, strikes, riots,  governmental act
or failure to act,  shortage of  materials,  weather and other such matters over
which the party does not have reasonable  control (except matters resulting from
financial insufficiency).

          "Lease Year" means any calendar  year, or portion  thereof,  following
the  commencement  hereof,  the whole or any part of which  period  is  included
within the Term.

          "Leased  Premises"  shall mean the  portion of space  leased to Lessee
hereunder.

          "Lessee's  Work"  shall  mean the work of  improvement  to the  Leased
Premises to be performed by Lessee in accordance with the Work Letter Agreement.

          "Lessor's  Work"  shall  mean the work to be  performed  by  Lessor in
accordance with the Work Letter Agreement.

                                       4
<PAGE>
          "Lines" shall mean domestic  water,  chilled water and waste pipes and
lines,  exhaust  pipes and  vents,  communications,  computer,  audio and video,
security and electrical (other than electrical wiring within the Leased Premises
terminating  at or connected to Building check meters),  cables,  wires,  lines,
duct work,  sensors,  switching  equipment,  control  boxes,  risers and related
improvements at the Complex, Building or the Leased Premises.

          "Major  Vertical  Penetrations"  shall mean stairs,  elevator  shafts,
flues,  pipe shafts,  vertical ducts,  and the like, and their enclosing  walls,
which serve more than one floor of the Building,  but shall not include  stairs,
dumbwaiters,  lifts, and the like,  exclusively serving a lessee occupying space
on more than one floor.

          "Occupied  Floor Area" means that portion of the Rentable  Area of the
Complex which is leased and occupied.

          "Operating Costs" means the total amounts paid or payable,  whether by
Lessor  or  others  on  behalf of  Lessor,  in  connection  with the  ownership,
maintenance,  repair,  replacement  and  operations  of the Complex  (including,
without  limitation,  all areas and facilities within the exterior boundaries of
the  Complex) as  determined  in a manner  consistent  with  generally  accepted
accounting  principles  ("GAAP").  Operating  Costs  shall  include,  but not be
limited to, the aggregate of the amount paid for all  electricity  and fuel used
in heating and air conditioning of the Building;  the amount paid or payable for
all  electricity  furnished by Lessor to the Complex  exclusive  of  electricity
furnished to Lessee and other lessees for usable areas of the Complex;  the cost
of periodic  relamping and reballasting of Building Standard lighting  fixtures;
the  amount  paid or  payable  for  all hot and  cold  water  (other  than  that
chargeable to lessees by reason of their  extraordinary  consumption  of water);
the  amount  paid or  payable  for all labor  and/or  wages  and other  payments
including  cost to Lessor of workers'  compensation  and  disability  insurance,
payroll taxes,  welfare and fringe  benefits made to janitors,  caretakers,  and
other employees,  contractors and  subcontractors  of Lessor (including wages of
the Building manager)  involved in the operation,  maintenance and repair of the
Complex; painting for exterior walls of the buildings in the Complex; managerial
and administrative  expenses;  the total charges of any independent  contractors
employed  in the  repair,  care,  operation,  maintenance,  and  cleaning of the
Complex; the amount paid or payable for all supplies occasioned by everyday wear
and tear; the costs of VAC (as defined in Section 13.1) of the Complex,  (except
to the extent paid by Lessee,  or other lessees,  for VAC provided to the Leased
Premises,  or other  leased  premises,  in respect of VAC  provided  outside the
Climate  Control  Hours  defined in Section  13.1),  window  and  exterior  wall
cleaning, telephone and utility costs; the cost of accounting services necessary
to compute  the rents and  charges  payable by lessees and keep the books of the
Complex;  fees for  management,  legal,  accounting,  inspection  and consulting
services;  the cost of operating,  repairing and  maintaining  and replacing the
Building  escalators and elevators and the utility systems,  including Lines, of
the Complex including the cost of inspection and service contracts;  the cost of
porters,  guards and other  protection  services;  the cost of establishing  and
maintaining the Building's directory board; payments for general maintenance and
repairs  to the plant  and  equipment  supplying  climate  control;  the cost of
supplying all services pursuant to Article 13 hereof to the extent such services
are not paid by individual lessees;  amortization of the costs, including repair
and  replacement,  of all maintenance and cleaning  equipment and master utility
meters and of the costs incurred for repairing or replacing all other  fixtures,
equipment and facilities serving or comprising the Complex which by their nature
require periodic or substantial repair or replacement, and which are not charged
fully in the year in which  they are  incurred,  at rates on the  various  items
determined  from time to time by Lessor in  accordance  with  GAAP;  the cost of
operating  the parking  facility in the Complex and the cost of parking fees and
rents paid to the owner of another  parcel  for use of  certain  parking  spaces
therein  (collectively  "Parking Costs") net of parking fees and rents collected
by  Lessor  in  connection  herewith  provided,  however,  Lessor  shall  not be

                                       5
<PAGE>
obligated to credit any sums received in excess of the actual Parking Costs; the
cost and expenses for  insurance  for which Lessor is  responsible  hereunder or
which Lessor  reasonably deems necessary in connection with the operation of the
Complex  (including,  without  limitation,  self-insurance  and the  payment  of
deductible  amounts under insurance  policies);  community  association  dues or
assessments and property owners'  association dues and assessments  which may be
imposed upon Lessor by virtue of any recorded instrument  affecting title to the
Complex; and costs of complying with all governmental regulations,  rules, laws,
ordinances  and codes enacted after the Delivery Date,  including  Environmental
Laws as such term is defined in Article 12. In addition,  Operating  Costs shall
include any Real Estate Taxes as defined in Paragraph 2.1 hereof Operating Costs
shall also include, without limitation, the repair and replacement,  resurfacing
and  repaving  of any paved  areas,  curbs,  gutters or other  surfaces or areas
within the Complex,  the repair and  replacement  of any equipment or facilities
located  within or serving the  Complex,  and the cost of any  capital  repairs,
replacements or improvements  made by Lessor to the Complex  ("Capital  Costs").
However,  certain  Capital  Costs  (the  "Restricted  Capital  Costs")  shall be
includable  in  Operating  Costs each year only to the  extent of that  fraction
allocable  to the year in question  calculated  by  amortizing  such  Restricted
Capital  Costs over the  reasonably  useful  life of the  improvement  resulting
therefrom,  as determined by Lessor, with interest on the unamortized balance at
the higher of (i) ten percent (10%) per annum;  or (ii) the interest rate as may
have been paid by Lessor for the funds  borrowed  for the purpose of  performing
the work for which the Restricted  Capital Costs have been  expended,  but in no
event to exceed the highest  rate  permissible  by law. The  Restricted  Capital
Costs subject to such amortization procedure are the following:  (X) those costs
for capital  improvements  to the Complex of a type which do not normally  recur
more  frequently than every five (5) years in the normal course of operation and
maintenance of facilities such as the Complex  (specifically  excluding painting
of all or a portion  of the  Complex);  (y) costs  incurred  for the  purpose of
reducing other operating expenses or utility costs, from which Lessee can expect
a reduction in the amounts it would otherwise expend,  or reimburse Lessor,  and
(z)  expenditures  by Lessor that are required by governmental  law,  ordinance,
regulation or mandate, including, without limitation, any Environmental Laws (as
such term is defined in Article 12), which were not applicable to the Complex at
the time of the original  construction.  Operating Costs shall not include legal
or  accounting  expenses  incurred  expressly  for  negotiating  a lease  with a
particular  lessee,  or as a result of a default  of a  specific  lessee,  which
negotiation or default does not affect the operation of the Complex.

          "Proportionate  Share" or "Pro Rata  Percent"  shall be that  fraction
(converted to a  percentage)  the numerator of which is the Rentable Area of the
Leased  Premises  and the  denominator  of which is the number of square feet of
Rentable  Area of all floors (or leased  premises  if the Complex is on a single
floor) rentable to lessees in the Complex.  Lessee's  Proportionate  Share as of
the  commencement  of  the  Term  hereof  is  specified  in  Section  1.8.  Said
Proportionate Share shall be recalculated as may be required effective as at the
commencement of any period to which the calculation is applicable in this Lease.
Notwithstanding the preceding provisions of this Section, Lessee's Proportionate
Share as to certain  expenses may be  calculated  differently  to yield a higher
percentage  share for Lessee as to certain  expenses in the event Lessor permits
other lessees in the Complex to directly  incur such  expenses  rather than have
Lessor  incur  the  expense  in  common  for the  Complex  (such  as,  by way of
illustration,  wherein a lessee performs its own janitorial  services).  In such
case Lessee's  Proportionate Share of the applicable expense shall be calculated
as having as its denominator the Rentable Area of all floors (or leased premises
if the Complex is on a single floor) rentable to lessees in the Complex less the
Rentable Area of lessees who have incurred such expense  directly.  Furthermore,
in the event Lessee consumes  extraordinary  amounts of any provided  utility or
other  service  as  determined  in  Lessor's  good  faith   judgment,   Lessee's
Proportionate  Share for such utility or service may, at Lessor's  election,  be
based on usage as opposed to  Rentable  Area,  that is,  Lessee's  Proportionate
Share  of such a  utility  or  service  would be  calculated  as  having  as its
denominator  the total  usage of such  utility  or service  in the  Complex  (or
Building as the case may be), and having as its numerator Lessee's usage of such
utility or service, as determined by Lessor in its sole good faith judgment.  In
any case in which Lessee, with Lessor's consent,  incurs such expenses directly,
Lessee's  Proportionate  Share will be calculated  specially so that expenses of

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the same character which are incurred by Lessor for the benefit of other lessees
in the  Complex  shall not be prorated to Lessee.  If repairs are  required  for
systems  exclusively  serving the Leased Premises  (whether within or outside of
said  Leased  Premises),  Lessee  shall pay one hundred  percent  (100%) of such
repair costs.  Nothing  herein shall imply that Lessor will permit Lessee or any
other lessee of the Complex to incur any Common Area Costs or  Operating  Costs.
Any such permission shall be in the sole discretion of the Lessor,  which Lessor
may grant or withhold in its arbitrary judgment.

          "Quadrant." Floors 2-6 of the Building are centered around the central
Atrium with  Rentable Area being  approximately  divided into four unequal parts
known as "Quadrant(s)" and commonly carrying identifying letters as follows:

               Quadrant A: Southeast of Atrium
               Quadrant B: Northeast of Atrium
               Quadrant C: Northwest of Atrium
               Quadrant D: Southwest of Atrium

          "R/U Ratio" (an  abbreviation  for  Rentable/Usable  Ratio) shall mean
that  fraction the numerator of which is Rentable  Area and the  denominator  of
which is Usable Area.

          "Real Estate  Taxes" or "Taxes" shall mean and include all general and
special taxes,  assessments,  fees of every kind and nature,  duties and levies,
charged and levied upon or assessed by any  governmental  authority  against the
Complex including the land, the Building, any other improvements situated on the
land other than the Building,  the various estates in the land and the Building,
any Tenant  Improvements,  fixtures,  installations,  additions  and  equipment,
whether owned by Lessor or Lessee; except that it shall exclude any taxes of the
kind covered by Section 8.1 hereof to the extent Lessor is  reimbursed  therefor
by any  lessee in the  Building.  Real  Estate  Taxes  shall  also  include  the
reasonable  cost  to  Lessor  of  contesting  the  amount,   validity,   or  the
applicability  of any Taxes mentioned in this section provided Tenant receives a
ratable credit for any refund obtained through such a contest.  Further included
in the  definition  of Taxes  herein  shall be general and special  assessments,
license  fees,   commercial  rental  tax,  levy,  penalty  or  tax  (other  than
inheritance  or estate  taxes)  imposed  by any  authority  having the direct or
indirect  power to tax, as against any legal or equitable  interest of Lessor in
the Leased  Premises or in the Complex or on the act of entering into this Lease
or, as against Lessor's right to rent or Other income  therefrom,  or as against
Lessor's  business of leasing the Leased Premises or the Complex,  any tax, fee,
or charge  with  respect  to the  possession,  leasing,  transfer  of  interest,
operation,  management,  maintenance,  alteration,  repair, use, or occupancy by
Lessee, of the Leased Premises or any portion thereof or the Complex, or any tax
imposed in substitution,  partially or totally,  for any tax previously included
within the  definition of Taxes  herein,  or any  additional  tax, the nature of
which may or may not have been  previously  included  within the  definition  of
Taxes.  Further,  if at any time  during  the Term of this  Lease the  method of
taxation or assessment of real estate or the income therefrom  prevailing at the
time of execution  hereof shall be, or has been altered so as to cause the whole
or any part of the Taxes now or  hereafter  levied,  assessed or imposed on real
estate to be levied,  assessed or imposed upon Lessor, wholly or partially, as a
capital levy,  business tax, fee,  permit or other charge,  or on or measured by
the Rents  received  therefrom,  then such new or altered  taxes,  regardless of
their  nature,  which are  attributable  to the land,  the  Building or to other
improvements  on the land  shall be deemed to be  included  within the term Real
Estate Taxes for purposes of this Section,  whether in  substitution  for, or in
addition to any other Real Estate Taxes,  save and except that such shall not be
deemed to include any  enhancement of said tax  attributable  to other income of
Lessor.  With respect to any general or special  assessments which may be levied
upon or against the Leased Premises,  the Complex,  or the underlying realty, or
which may be evidenced by improvement or other bonds,  and may be paid in annual

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<PAGE>
or semi-annual installments,  only the amount of such installment,  prorated for
any  partial  year,  and  statutory   interest  shall  be  included  within  the
computation of Taxes for which Lessee is responsible hereunder.  Notwithstanding
anything to the contrary contained herein,  Taxes shall not include any interest
and  penalties  due to Landlord's  failure to pay Taxes before  delinquency  due
date.

          "Rent,"  "rent" or "rental"  means Minimum Rent (as defined in Section
7.1  herein) and all other sums  required  to be paid by Lessee  pursuant to the
terms of this Lease.

          "Rentable  Area." The Rentable Area means the Rentable Area determined
by BOMA,  subject to such  adjustments  as Lessor may  incorporate  from time to
time.  The Rentable  Area of a floor shall mean all areas  available or held for
the exclusive use and occupancy of occupants or future occupants of the Complex,
calculated in accordance with BOMA. No deductions  shall be made for columns and
projections  necessary to the  Building.  The Rentable Area of that portion of a
lessee's premises located on a floor shall be computed by multiplying the Usable
Area of such premises by the R/U Ratio. The Rentable Area of the Building is the
aggregate of the Rentable Area on all floors.

          "Structural"  as herein  used  shall  mean any  portion  of the Leased
Premises or Complex which provides  bearing support to any other integral member
of the Complex such as, by  limitation,  the roof  structure  (trusses,  joists,
beams), posts, load bearing walls, foundations, girders, floor joists, footings,
and other load bearing members constructed by Lessor.

          "Tenant  Improvements" shall mean the Lessee's Work in accordance with
the Work Letter Agreement and all subsequent  Alterations (as defined in Section
15.2 herein) to the Leased Premises made by Lessee.

          "Term"  shall  mean the term of the lease as  specified  in  Article 4
hereof, including any partial month at the commencement of the Term.

          "Usable Area." The Usable Area of any individual leased premises shall
be the number of square feet calculated in accordance with BOMA, subject to such
adjustments as Lessor may incorporate from time to time; provided, however, that
the term Usable Area shall include  toilet rooms in each Quadrant if such toilet
rooms are for the exclusive use of a lessee occupying such Quadrant.  The Usable
Area of a floor shall be equal to the sum of all Usable Areas on that floor.

          "Work Letter  Agreement."  That certain  Agreement for  performance of
improvements  to the  Premises,  Building  or  Complex  set forth in  Exhibit D,
attached hereto and made a part herein by reference.

                                   3. PREMISES

     3.1 Demising Clause.  Lessor hereby leases to Lessee, and Lessee hires from
Lessor a portion of the Complex as hereinafter defined.

     3.2  Description.  The  Complex,  as defined in Section  2.1, is  described
generally in Section 1.3(A) hereof.  The premises leased herein are described in
Section 1.3(B) and delineated on Exhibit C, which is attached  hereto and made a
part hereof by reference, consisting of the approximate amount of square footage
as specified in Section 1.3(B) hereof.  The term  "Building"  shall refer to the
Building in which the Leased Premises are located.  The portion leased herein to
Lessee is hereinafter  referred to as the "Leased Premises." Lessee acknowledges
that  Lessor  may change the  shape,  size,  location,  number and extent of the
improvements to any portion of the Complex without consent of Lessee and without

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<PAGE>
affecting Lessee's obligations hereunder provided such changes do not materially
and adversely affect Tenant's access to the Leased Premises. Lessor reserves the
area beneath and above the Leased  Premises,  as well as the  exterior  thereof,
together with the right to install,  maintain,  use,  repair and replace  Lines,
pipes,  ducts,  conduits,  wires,  and structural  elements  leading through the
Leased Premises serving other parts of the Complex,  including,  but not limited
to, vertical risers,  so long as such items are concealed by walls,  flooring or
ceilings. Such reservation in no way affects the maintenance obligations imposed
herein,  nor shall such  reservation  alter the  parties'  responsibilities  and
obligations set forth in this Lease regarding Hazardous Materials (as defined in
Section 12.3(a) below).

     3.3 ATM.  Lessee  may  install,  at  Lessee's  sole  cost and  expense,  an
Automated Teller Machine ("ATM") in a location mutually  agreeable to Lessor and
Lessee. The size and signage of the ATM will be subject to Lessor's approval. If
the ATM is located on a wall that is a perimeter wall of the Leased  Premises as
shown on Exhibit C, the ATM Rent reflected on Section 1.5 shall not apply.

     3.4  Covenants,  Conditions and  Restrictions.  The parties agree that this
Lease is subject to the effect of: (a) any covenants, conditions,  restrictions,
easements,  mortgages or deeds of trust, ground leases, rights of way of record,
and any other  matters or documents of record;  (b) any zoning laws of the city,
county and state  where the  Complex is  situated;  and (c)  general and special
taxes not delinquent.  Lessee agrees that as to its leasehold estate, Lessee and
all persons in  possession  or holding under Lessee will conform to and will not
violate the terms of any covenants,  conditions or  restrictions of record which
may now or hereafter  encumber the property  (hereinafter  the  "Restrictions").
This  Lease  is   subordinate  to  the   Restrictions   and  any  amendments  or
modifications thereto.

     3.5 Right of First Offer.

          (a) Commencing twelve (12) months after the Commencement  Date, Lessee
shall have a continuing  right of "First  Offer" to lease any increment of space
adjacent to the Leased  Premises which becomes  "available for lease" during the
term subject to the  provisions of this Section 3.5. An increment of space shall
not be deemed  "available  for lease" if the lessee  under an expiring  lease of
such space  desires to renew or extend its lease of such space  pursuant  to the
exercise  of a right or option to do so  pursuant  to the terms of such  party's
lease.

          (b) Lessor shall give Lessee written notice  ("Lessor's Right of First
Offer  Notice") of each  increment of space which  becomes  available  for lease
within thirty (30) days of  availability.  Lessor's  Right of First Offer Notice
shall identify the First Offer space, the availability  date, and the applicable
Rent.  If Lessee  elects to lease the First Offer  space,  Lessee  shall  notify
Lessor in writing within ten (10) days after Lessee's  receipt of Lessor's Right
of First Offer Notice.  If Lessee does not exercise its right to lease the First
Offer Space,  Lessor shall be released of any further  obligation  to offer that
particular  First Offer Space to Lessee  unless the space  subsequently  becomes
available for lease.

          (c) Upon  Lessee's  election to lease a First Offer Space,  Lessor and
Lessee shall  promptly  enter into an amendment of this Lease,  adding the First
Offer Space to the Leased  Premises  herein on all terms and  conditions of this
Lease  except  that (i) the term of the lease of such First  Offer  Space  shall
commence upon the ..availability date and shall continue  coextensively with the
remaining Term of this Lease; (ii) the Rent shall be the Rent stated in Lessor's
Right of First Offer Notice, subject to adjustment as provided in the Lease; and
(iii) Lessee shall take the First Offer Space in its then "as-is"  condition and
Lessor shall have no obligation to pay for any improvements.

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<PAGE>
          (d)  Notwithstanding  the  foregoing  provision  of this  Section 3.5,
Lessee shall have no right of First Offer if (i) an Event of Default  shall have
occurred and be continuing under this Lease;  (ii) Lessee is not in occupancy of
the entire original Leased  Premises;  or (iii) Lessee does not intend to occupy
the First Offer  Space.  Tenant's  right of First Offer shall not be  applicable
during the last two (2) years of the Term unless and until Lessee shall  validly
exercise its renewal  option,  in which case Lessee's right of First Offer shall
terminate two (2) years prior to the expiration of the next  succeeding  renewal
term.

                                     4. TERM

     4.1  Commencement  Date.  The  Term of this  Lease  shall  commence  on the
Commencement  Date defined in Section2-1  and shall be for the Term specified in
Section 1.4(B) hereof, plus any partial month at the commencement of the Term.

     4.2  Acknowledgment of Commencement.  After delivery of the Leased Premises
to  Lessee,  Lessee  shall  execute  a  written  acknowledgment  of the  date of
commencement  in the form attached hereto as Exhibit E, and by this reference it
shall be incorporated herein.

     4.3 Renewal Term.

          (a)  Manner of  Exercise.  Lessee  shall  have the right and option to
extend the Term of this  Lease for two (2)  additional  period(s)  of five years
(such  period  being  referred to as a "Renewal  Term") as  specified in Section
1.4(c),  provided  that no uncured  event of default  exists as of the date that
Tenant  exercises  its option to extend.  Lessee may exercise the option,  if at
all,  by written  notice to Lessor  delivered  no later than  twelve (12) months
prior to the date which  represents  the  expiration  of the then  current  term
("Expiration  Date"),  (the "Outside  Exercise  Date").  Unless all of the above
conditions precedent have been satisfied,  Lessee's exercise of any option shall
be of no force or effect and the Renewal Term shall  lapse.  If all of the above
conditions  precedent  are  satisfied,  then  the  term of this  Lease  shall be
extended for the Renewal Term,  and all of the terms,  conditions and provisions
of this Lease  shall  continue in full force and effect  throughout  the Renewal
Term,  except  that the Minimum  Rent to be paid by Lessee for the Renewal  Term
shall be 100% of the Fair Market  Rental (as defined  below) value of the Leased
Premises as of the  Expiration  Date, but in no event shall the Minimum Rent for
the Renewal  Term be less than the Minimum Rent payable in the last month of the
Term of this Lease prior to the Expiration Date.

          (b) Fair Market  Rental.  If Lessee  exercises the right to extend the
Term then the Minimum Rent shall be adjusted to equal the Fair Market Rental for
the Leased  Premises as of the date of the  commencement  of the  Renewal  Term,
pursuant to the procedures  hereinafter set forth. The term "Fair Market Rental"
means the  Minimum  Rent  chargeable  for the  Leased  Premises  based  upon the
following factors applicable to the Leased Premises or any comparable premises:

               (i) Rental  rates being  charged for  comparable  premises in the
same geographical location.

               (ii) The relative locations of the comparable premises.

               (iii) Improvements,  or allowances provided for improvements,  or
to be provided.

               (iv) Rental adjustments, if any, or rental concessions.

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<PAGE>
               (v) Services and utilities provided or to be provided.

               (vi) Use limitations or restrictions.

               (vii) Any other relevant Lease terms or conditions.

The Fair Market  Rental  evaluation  may  include  provision  for  further  rent
adjustments during the Renewal Term in question if such adjustments are commonly
required in the market place for similar types of leases.

          (c) Determination of Fair Market Rental. Upon exercise of the right to
extend the Term, and included within the Notice of Exercise, Lessee shall notify
Lessor of its  opinion of Fair  Market  Rental as above  defined for the Renewal
Term. If Lessor  disagrees with Lessee's  opinion of the Fair Market Rental,  it
shall * so notify Lessee ("Lessor's Value Notice") within thirty (30) days after
receipt of  Lessee's  Notice of  Exercise.  If the parties are unable to resolve
their  differences  within ten (10) days thereafter or if separated by more than
ten percent (10%),  either party may apply for Arbitration as provided below. If
the values are within ten percent  (100/6),  they shall be averaged.  If neither
party  applies for  Arbitration  within ten (10) days after receipt by Lessee of
Lessor's Value Notice, Lessee shall be bound to the Fair Market Rental stated in
Lessor's  Value  Notice.  Should  either  party elect to  arbitrate,  and if the
arbitration is not concluded before the commencement of the Renewal Term, Lessee
shall pay Minimum  Rent to Lessor in an amount  equal to the Fair Market  Rental
set forth in Lessor's  Value Notice,  until the Fair Market Rental is determined
in accordance with the arbitration  provisions  hereof  ("Arbitration").  If the
Fair Market  Rental as  determined  by  Arbitration  differs from that stated in
Lessor's  Value  Notice,  then any  adjustment  required  to correct  the amount
previously  paid by Lessee  shall be made by  payment by the  appropriate  party
within  thirty  (30)  days  after the  determination  of Fair  Market  Rental by
Arbitration has been concluded, as provided herein. Lessee shall be obligated to
make payment  during the entire  Renewal Term of the Minimum Rent  determined in
accordance with the Arbitration procedures hereunder.

          (d) Arbitration.  In the event either party seeks  Arbitration of Fair
Market Rental under the provisions  hereof for the Renewal Term, the other party
shall be bound to submit  the  matter  for  determination  by  Arbitration.  The
Arbitration  shall be conducted  and  determined  in the County where the Leased
Premises are located.

          (e) Demand for Arbitration.  A party demanding  Arbitration  hereunder
shall make its demand in writing  ("Demand  Notice")  within ten (10) days after
service of Lessor's Value Notice.

          (f)  Within ten (10) days after  service  of a Demand  Notice,  Lessor
shall  provide  Lessee with the names of three (3)  appraisers.  Each  appraiser
shall be a member of the American  Institute of Real Estate  Appraisers  (or its
successor),  or real estate professionals  qualified by appropriate training and
experience and having at least ten (10) years experience dealing with commercial
office  leasing in the San  Francisco  South of Market and  Financial  districts
("Appraiser  Notice").  Within  ten (10) days  after  service  of the  Appraiser
Notice,  Lessee  shall  notify  Lessor  of  Lessee's  selection  of  one  of the
appraisers  designated in the Appraiser Notice and that Appraiser shall serve as
the Arbitrator.

          (g) Decision of the  Arbitrator.  The  Arbitrator  so selected  shall,
within   ninety  (90)  days  after  his   appointment,   state  in  writing  his
determination as to whether Lessor's  valuation,  or Lessee's  valuation of Fair
Market Rental,  most closely  approximates his own. The Arbitrator may not state
his own opinion of Fair Market Rental,  but is strictly limited to the selection
of Lessor's Fair Market Rental  evaluation as stated in Lessor's Value Notice or

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<PAGE>
Lessee's Fair Market Rental evaluation as stated in the Notice of Exercise.  The
Arbitrator  shall have the right to consult  experts and  competent  authorities
with factual  information  or evidence  pertaining  to a  determination  of Fair
Market Rental,  but any such consultation  shall be made in the presence of both
parties with full right to cross examine.  The Arbitrator shall have no right to
propose  a  middle  ground  or  any  modification  of  either  of  the  proposed
valuations,  and shall have no power to modify the provisions of this Lease. The
valuation so chosen as most closely  approximating  that of the Arbitrator shall
constitute  the decision of the  Arbitrator  and shall be final and binding upon
the parties, absent fraud or gross error. The Arbitrator shall render a decision
and award in writing, with counterpart copies to each party and judgment thereon
may be entered in any court of competent jurisdiction.

          (h) Successor Arbitrator;  Fees and Expenses. In the event of failure,
refusal,  or inability of the Arbitrator to act in a timely manner,  a successor
shall be  appointed  in the same  manner as such  Arbitrator  was  first  chosen
hereunder.  The fees  and  expenses  of the  Arbitrator  and any  administrative
hearing fee, if any, shall be divided  equally  between the parties.  Each party
shall  bear  its own  attorneys'  fees and  other  expenses  including  fees for
witnesses in presenting evidence to the Arbitrator.

                             5. PRE-TERM POSSESSION

     5.1 Pre-Term Possession.

          (a)  Conditions  of Entry In the event the Leased  Premises  are to be
constructed  or  remodeled by Lessor,  Lessor may notify  Lessee when the Leased
Premises are ready for Lessee's  fixturing or Lessee's Work,  which may be prior
to substantial completion of the Leased Premises by Lessor. Lessee may thereupon
enter the  Leased  Premises  for such  purposes  at its own  risk,  to make such
improvements  as Lessee  shall  have the  right to make,  to  install  fixtures,
supplies,  inventory and other property.  Lessee agrees that it shall not in any
way  interfere  with the  progress of Lessor's  Work by such entry.  Should such
entry  prove an  impediment  to the  progress  of  Lessor's  Work,  in  Lessor's
judgment,  Lessor may demand that Lessee  forthwith  vacate the Leased  Premises
until such time as  Lessor's  work is  complete,  and Lessee  shall  immediately
comply with this demand.  In the event Lessor  requires that Lessee vacate,  the
ninety (90) day time  period  specified  in Section  2.1,  "Commencement  Date",
(iii),  shall be  extended  for the number of days  Tenant has been  required to
vacate the Leased Premises.

          (b) Lease Terms Apply.  During the course of any pre-term  possession,
whether such pre-term  period arises because of an obligation of construction on
the part of Lessor, or otherwise, all terms and conditions of this Lease, except
for rent and  Commencement  Date,  shall apply,  particularly  with reference to
indemnity by Lessee of Lessor under Article 17 herein for all occurrences within
or about the Leased Premises.

                       6. DELAY IN DELIVERY OF POSSESSION

     6.1 Delay. If Lessor, for any reason whatsoever,  cannot deliver possession
of the Leased  Premises to Lessee at the  Estimated  Delivery  Date,  this Lease
shall not be void or voidable, nor shall Lessor be liable for any loss or damage
resulting  therefrom,  but in that event,  there shall be no accrual of Rent for
the period between the Estimated Delivery Date and the Commencement Date. In the
event  Lessor  cannot  deliver the Leased  Premises to Lessee  within  three (3)
months beyond the Estimated  Delivery  Date,  then Lessee may elect to terminate
this Lease by written notice to Lessor within ten (10) days  thereafter.  In the
event Lessor,  after diligent and good faith efforts,  cannot deliver the Leased
Premises to Lessee  within six (6) months beyond the  Estimated  Delivery  Date,
then Lessor may elect to terminate this Lease by written notice to Lessee within

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ten (10) days  thereafter.  In the event the Leased  Premises are not  delivered
within  three  (3)  years  from  the  date  of   execution,   this  Lease  shall
automatically terminate.

                                 7. MINIMUM RENT

     7.1 Payment. Lessee shall pay to Lessor at the address specified in Section
1. 1, or at such other  place as Lessor may  otherwise  designate,  as  "Minimum
Rent" for the Leased  Premises the amount  specified in Section  1.5(A)  hereof,
payable in advance on the first day of each month  during the Term.  If the Term
commences  on other  than the first day of a  calendar  month,  the rent for the
first partial month shall be prorated accordingly.

     All  payments of Minimum  Rent  (including  sums defined as rent in Section
2.1)  shall be in  lawful  money  of the  United  States,  and  payable  without
deduction, setoff, offset, counterclaim,. recoupment, notice or demand.

     7.2 Advance  Rent.  The amount  specified in Section  1.5(B) hereof is paid
herewith  to Lessor upon  execution  of this Lease as advance  rent,  receipt of
which is hereby acknowledged,  provided, however, that such amount shall be held
by Lessor as a "Security  Deposit"  pursuant to Section  10.1 hereof until it is
applied by Lessor to the first Minimum Rent due hereunder.

     7.3 Late  Payment.  If during any twelve (12) month period  Lessee fails on
more than one occasion to make any payment of Minimum Rent to Lessor on the date
when it is due,  then Lessor may, by giving  written  notice to Lessee,  require
that. Lessee pay the Minimum Rent to Lessor quarterly in advance.

                               8. ADDITIONAL RENT

     8.1 Personal Property,  Gross Receipts,  Leasing Taxes. This Section 8.1 is
intended to deal with impositions or taxes directly attributed to Lessee or this
transaction,  as distinct from taxes attributable to the Complex which are to be
allocated  among various  lessees and others and which are included in Operating
Costs.  In  addition to the Minimum  Rent and  additional  charges to be paid by
Lessee  hereunder,  Lessee  shall  reimburse  Lessor upon demand for any and all
taxes required to be paid by Lessor (excluding state,  local or federal personal
and  corporate  income taxes  measured by the income of Lessor from all sources,
and estate and  inheritance  taxes)  whether or not now  customary or within the
contemplation of the parties hereto:

          (a) Upon, measured by, or reasonably attributable to the cost or value
of Lessee's equipment,  furniture,  fixtures and other personal property located
in the Leased Premises or by the cost or value of any Tenant  Improvements  made
in or to the Leased  Premises by or for Lessee,  regardless  of whether title to
such improvements shall be in Lessee or Lessor;

          (b)  Upon or  with  respect  to the  possession,  leasing,  operation,
management,  maintenance,  Alteration, repair, use or occupancy by Lessee of the
Leased Premises or any portion thereof to the extent such taxes are not included
as Real Estate Taxes as defined in Section 2. 1;

          (c) Upon this  transaction  or any document to which Lessee is a party
creating or transferring an interest or an estate in the Leased Premises; and

          (d)  In  connection  with  any  testing,   investigation,   abatement,
remediation,  removal, transportation and/or disposal of any Hazardous Materials
by Lessee (or by Lessor,  pursuant to any  provision  of this Lease  granting to
Lessor the right to do any of the foregoing and to bill Lessee therefor).

                                       13
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     For purposes of this Section 8.1, the term "taxes" shall  include,  but not
be limited to, any fees, charges, fines, penalties and costs (including, without
limitation,  permit,  approval or licensing fees,  charges or costs),  excepting
interest and penalties for failure of Landlord to pay Taxes in a timely manner.

     In the event that it shall not be lawful for Lessee so to reimburse Lessor,
the Minimum  Rent  payable to Lessor  under this Lease shall be increased to net
Lessor  (i.e.,  after  payment  of the Taxes for which  Lessor  may not  receive
reimbursement  from  Lessee) the amount of Minimum Rent plus  reimbursement  for
Taxes  which  would  have  been  receivable  by  Lessor if such tax had not been
imposed.  All Taxes  payable by Lessee under this Section shall be deemed to be,
and shall be paid as, additional Rent.

     8.2 Operating Costs.

          (a) During each  calendar  year or part  thereof,  Lessee shall pay to
Lessor as  additional  Rent,  in  accordance  with Section 8.3 hereof,  Lessee's
Proportionate  Share of all Operating Costs for such calendar year.  During each
tax year (July 1 through June 30) or part thereof, Lessee shall pay to Lessor as
additional Rent, in accordance with Section 8.3 hereof,  Lessee's  Proportionate
Share of all Real Estate Taxes for such tax year.

          (b) In addition,  Lessee shall pay to Lessor,  as additional  Rent, in
accordance  with  Section  8.3  hereof,   one  hundred  percent  (100%)  of  the
electricity and other separately metered utility charges for the Leased Premises
(including utilities for the VAC system).

          (c) If any Lease  Year of less than  twelve  (12)  months is  included
within the Term,  the amount payable by Lessee for such period shall be prorated
on a per them basis (utilizing a three hundred sixty (360) day year).

          (d) Lessor shall  exercise  good faith  efforts to equitably  allocate
those Operating Costs that are incurred for the direct benefit of specific types
of lessees or users in the Complex to and among those  specific  lessees  and/or
users ("Cost Pools").  Such Cost Pools may include, but shall not be limited to,
the office,  and showroom space,  the second floor Atrium,  the concourse level,
and any retail space  lessees of the  Complex.  Lessor's  determination  of such
allocations  shall be made in a manner  consistent with the terms and conditions
of this  Section  8.2(c)  and shall be  subject to  reconciliation  per  Section
8.3(c).  Lessee  acknowledges  that the allocation of Operating Costs among Cost
Pools does not affect all Operating Costs and is limited to specific items which
Lessor  determines,  in good faith,  should be shared  among the lessees  and/or
users of a certain Cost Pool.

     8.3 Method of Payment. Any additional Rent payable by Lessee under Sections
8.1 and 8.2 hereof shall be paid as follows, unless otherwise provided:

          (a) During  the Term,  Lessee  shall pay to Lessor  monthly in advance
with its  payment  of  Minimum  Rent,  one-twelfth  (1/12) of the amount of such
additional Rent as estimated by Lessor in advance, in good faith, to be due from
Lessee.

          (b) Annually,  as soon as is reasonably  possible after the expiration
of each Lease Year,  Lessor shall  prepare in good faith and deliver to Lessee a
comparative  statement,  which statement shall be conclusive between the parties
hereto, setting forth: (i) the Operating Costs for such Lease Year; and (ii) the
amount of additional  Rent as determined  in accordance  with the  provisions of
this Article 8.

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<PAGE>
          (c) If the aggregate amount of such estimated additional Rent payments
made by Lessee in any Lease Year should be less than the additional Rent due for
such year,  then Lessee shall pay to Lessor as  additional  Rent within  fifteen
(15) days of  written  demand the amount of such  deficiency.  If the  aggregate
amount of such  additional Rent payments made by Lessee in any Lease Year of the
Term should be greater than the additional  Rent due for such year,  then should
Lessee not be otherwise in default hereunder,  the amount of such excess will be
applied by Lessor to the next  succeeding  installments  of such additional Rent
due  hereunder;  and if there is any such  excess for the last year of the Term,
the amount thereof will be refunded by Lessor to Lessee,  provided Lessee is not
otherwise in default under the terms of this Lease.

                           9. ACCORD AND SATISFACTION

     9.1  Acceptance of Payment.  No payment by Lessee or receipt by Lessor of a
lesser amount of Minimum Rent or any other sum due hereunder, shall be deemed to
be other than on  account of the  earliest  due rent or  payment,  nor shall any
endorsement or statement on any check or any letter  accompanying any such check
or  payment  be deemed an accord and  satisfaction,  and Lessor may accept  such
check or payment  without  prejudice to Lessor's right to recover the balance of
such rent or payment or pursue any other remedy  available in this Lease, at law
or in equity.  Lessor  may  accept  any  partial  payment  from  Lessee  without
invalidation  of any  contractual  notice  required to be given  herein ( to the
extent such  contractual  notice is required)  and without  invalidation  of any
notice  required to be given  pursuant  to  California  Code of Civil  Procedure
section 1161, et seq., or of any successor statute thereto.

                              10. SECURITY DEPOSIT

     10.1 Lessee  shall pay Lessor upon  execution  hereof the sum  specified in
Section 1.6. This sum is  designated as a Security  Deposit and shall remain the
sole and  separate  property of Lessor  until  actually  repaid to lessee (or at
Lessor's option the last assignee, if any, of Lessee's interest hereunder), said
sum not being earned by Lessee until all conditions precedent for its payment to
Lessee  have been  fulfilled.  As this sum both in equity and at law is Lessor's
separate  property,  Lessor  shall not be  required  to:  (i) keep said  deposit
separate from its general accounts;  or (ii) pay interest or other increment for
its use. If Lessee  fails to pay rent or other  charges when due  hereunder,  or
otherwise  defaults with respect to any  provision of this Lease,  including and
not  limited to  Lessee's  obligation  to  restore or clean the Leased  Premises
following  vacation thereof,  Lessee, at Lessor's  election,  shall be deemed to
have earned the right to repayment of the Security  Deposit,  or those  portions
thereof  used or applied by Lessor for the payment of any rent or other  charges
in  default,  or for the  payment  of any other sum to which  Lessor  may become
obligated by reason of lessee's default, or to compensate Lessor for any loss or
damage  which Lessor may suffer  thereby.  Lessor may retain such portion of the
Security Deposit as it reasonably deems necessary to restore or clean the Leased
Premises  following  vacation  by  Lessee.  The  Security  Deposit  is not to be
characterized  as rent  until and  unless so  applied in respect of a default by
Lessee.  In the event a portion or all of the Security  Deposit is paid pursuant
to a Letter of Credit, the terms specified in Exhibit J, attached hereto,  shall
apply.

     10.2 If Lessor  elects to use or apply all or any  portion of the  Security
Deposit as provided in Section  10.1,  Lessee  shall  within ten (10) days after
written demand therfor pay to Lessor in cash, an amount equal to that portion of
the Security  Deposit used or applied by Lessor,  and Lessee's  failure to so do
shall be a material breach of this Lease.  The ten (10) day notice  specified in
the preceding  sentence shall insofar as not prohibited by law,  constitute full
satisfaction of notice of default provisions required by law or ordinance.

                                       15
<PAGE>
                                     11. USE

     11.1 Permitted  Use. The Leased  Premises may be used and occupied only for
the  purposes  specified  in Section  1.7  hereof,  and for no other  purpose or
purposes.  Lessee shall promptly  comply with all laws,  ordinances,  orders and
regulations affecting the Leased Premises, their cleanliness, safety, occupation
and use.

     11.2 Safes,  Heavy Equipment.  Lessee shall not place a load upon any floor
of the Leased  Premises  which  exceeds  fifty (50)  pounds per square foot live
load.  without the express written consent of Lessor.  Lessor reserves the right
to prescribe the weight and position of all safes and heavy  installations which
Lessee wishes to place in the Leased  Premises so as properly to distribute  the
weight thereof, or to require plans prepared by a qualified  structural engineer
at Lessee's sole cost and expense for such heavy  objects.  Notwithstanding  the
foregoing,  Lessor  shall  have  no  liability  for  any  damage  caused  by the
installation of such heavy equipment or safes.

     11.3 Machinery.  Business  machines and mechanical  equipment  belonging to
Lessee  which  cause  noise  and/or  vibration  that may be  transmitted  to the
structure of the Building or to any other leased space to such a degree as to be
objectionable  to Lessor or to any  lessees in the  Complex  shall be placed and
maintained by the party  possessing  the machines or equipment,  at such party's
expense,  in settings  of cork,  rubber or spring  type noise  and/or  vibration
eliminators,  and Lessee  shall take such other  measures as needed to eliminate
vibration and/or noise. If the noise or vibrations cannot be eliminated,  Lessee
must remove such equipment  within ten (10) days  following  written notice from
Lessor.

     11.4  Hazardous  Activities.  Lessee shall not engage in any  activities or
permit to be kept,  used, or sold in or about the Leased  Premises,  any article
which may be prohibited by the standard form of fire insurance policies.  Lessee
shall,  at its sole  cost and  expense,  comply  with any and all  requirements,
pertaining to the Leased  Premises,  of any insurance  organization  or company,
necessary for the maintenance of reasonable fire and public liability  insurance
covering the Building and appurtenances.

     11.5 Tenant  Exclusive.  Provided  (i) Lessee is not in default  under this
Lease,  (ii)  Lessee has not failed on two (2) or more  occasions  to observe or
perform any provision of this Lease during any twelve (12) month  period,  (iii)
Lessee is doing  business as a retail,  full service,  direct  deposit bank, and
(iv) this Lease has not been  terminated  and is still in effect,  Lessor agrees
not to enter  into a lease with any other  lessee  for space on the Lobby  Level
(First Floor Townsend Street Frontage) for use as a retail, full service, direct
deposit bank.  Notwithstanding  anything to the contrary  contained herein,  the
provisions  of this Section 11.5 shall not prevent  Lessor from leasing or using
space  anywhere in the Complex  (including  the Lobby Level) for (A) one or more
ATM's or  financial  services  machines or (B) for a financial  services or bank
business  provided such business is not a retail,  full service,  direct deposit
bank.

                    12. COMPLIANCE WITH LAWS AND REGULATIONS

     12.1 Lessee's Obligations. Except with respect to the Common Areas, Lessee,
shall, at its sole cost and expense,  comply with all of the requirements of all
municipal, state and federal authorities now in force, or which may hereafter be
in force, pertaining to the Leased Premises, and shall faithfully observe in the
use of the  Leased  Premises  all  municipal  ordinances  and state and  federal
statutes  and  regulations  now in force or which  may  hereafter  be in  force,
including, without limitation,  Environmental Laws (as hereinafter defined), and
the Americans  with  Disabilities  Act, 42 U.S.C.  ss.ss.  12101-12213  (and any
rules,  regulations,  restrictions,  guidelines,  requirements  or  publications
promulgated or published  pursuant thereto,  collectively  herein referred to as
the  "ADA"),   whether  or  not  any  of  the  foregoing  were   foreseeable  or
unforeseeable  at the time of the  execution of this Lease.  The judgment of any
court of  competent  jurisdiction,  or the  admission of Lessee in any action or
proceeding  against  Lessee,  whether Lessor be a party thereto or not, that any
such  requirement,  ordinance,  statute or  regulation  pertaining to the Leased

                                       16
<PAGE>
Premises has been  violated,  shall be conclusive of that fact as between Lessor
and Lessee.  Within  five (5)  business  days after  receipt of notice or actual
knowledge of any violation or alleged  violation by Lessee of any  Environmental
Law(s), and/or the ADA pertaining to the Complex, any governmental or regulatory
proceedings,  investigations,  sanctions and/or actions  threatened or commenced
with respect to any such violation or alleged  violation,  and any claim made or
commenced  with  respect to such  violation or alleged  violation,  Lessee shall
notify Lessor thereof and provide  Lessor with copies of any written  notices or
information in Lessee's possession. Lessee shall make, at Lessee's sole cost and
expense,  any and all Alterations,  improvements or non-structural  changes that
are required by laws,  statutes,  ordinances  and  governmental  regulations  or
requirements as a result of Lessee's  specific use of the Leased Premises or any
Alterations,  additions or  improvements  made by Lessee.  If any.  alterations,
improvements  or  structural  changes are required to be made to the Building in
general or are applicable to  substantially  all lessees in the Building without
regard to  Lessee's  specific  use of the Leased  Premises  or any  Alterations,
additions  or  improvements  made  by  Lessee,   then  Lessor  shall  make  such
alterations,  additions or improvements  and the costs thereof shall be included
within Operating Costs pursuant to Section 2.1.

     12.2  Condition of Leased  Premises.  Subject to Lessor's  Work, if any, as
referred  to in  Exhibit D to this  Lease,  Lessee  hereby  accepts  the  Leased
Premises in the condition  existing as of the date of occupancy,  subject to all
applicable  zoning,  municipal,  county  and  state  laws,  ordinances,   rules,
regulations,  orders,  restrictions of record, and requirements in effect during
the Term or any part of the Term hereof  regulating  the Leased  Premises,  and,
except as otherwise provided in this Lease, without representation,  warranty or
covenant by Lessor,  express or implied,  as to the condition,  habitability  or
safety of the Leased  Premises,  the  suitability  or fitness  thereof for their
intended purposes,  or any other matter. Lessor covenants that the Lessor's Work
pursuant to Exhibit D shall be in material  compliance with applicable local and
state  building  codes and  ordinances  in such  manner that any  violations  or
conditions  of  non-compliance  will not result in the inability of Lessee to be
issued a  building  permit  for  Lessee's  Work  pursuant  to  Exhibit  D ("Code
Compliance"). As of the date of execution of this Lease, Lessor has not received
any notices for items that remain  uncured  with respect to the  following:  (i)
notices  from  any  governmental  or  quasi-governmental   agency  alleging  any
violation of any applicable laws (including ADA and Environmental  Laws), rules,
ordinances,  regulations,  and other applicable  requirements  pertaining to the
Complex  or any  portion  thereof;  (ii)  any  notices  of any  claims  made  or
threatened  regarding  noncompliance with the ADA or any Environmental  Laws; or
(iii) any notices of any  governmental or regulatory  actions or  investigations
instituted  or  threatened   regarding   noncompliance   with  the  ADA  or  any
Environmental Laws as to any portion of the Complex.

     12.3 Hazardous Materials.

          (a) Hazardous  Materials Defined.  As used herein, the term "Hazardous
Materials" shall mean any wastes,  materials or substances  (whether in the form
of liquids,  solids or gases,  and whether or not  air-borne),  which are or are
deemed  to be  pollutants  or  contaminants,  or which  are or are  deemed to be
hazardous,  toxic,  ignitable,   reactive,  corrosive,   dangerous,  harmful  or
injurious,  or which present a risk, to public health or to the environment,  or
which are or may become  regulated by or under the  authority of any  applicable
local, state or federal laws, judgments, ordinances, orders, rules, regulations,
codes  or other  governmental  restrictions,  guidelines  or  requirements,  any
amendments  or  successor(s)  thereto,   replacements  thereof  or  publications
promulgated pursuant thereto  (collectively  "Environmental  Laws"),  including,
without limitation, any waste, material or substance which is:

               (i) defined as "hazardous waste," "extremely hazardous waste," or
"restricted  hazardous waste" under Sections 25115, 25117 or 25122.7,  or listed
pursuant to Section 25140,  of the California  Health and Safety Code,  Division
20, Chapter 6.5 (Hazardous Waste Control Law);

                                       17
<PAGE>
               (ii) defined as a "hazardous  substance"  under  Section 25316 of
the   California   Health  and   Safety   Code,   Division   20,   Chapter   6.8
(Carpenter-Presley-Tanner Hazardous Substance Account Act);

               (iii) defined as a "hazardous material,"  "hazardous  substance,"
or "hazardous  waste" under Section  25501 of the  California  Health and Safety
Code,  Division 20, Chapter 6.95 Hazardous  Materials Release Response Plans and
Inventory);

               (iv) defined as a "hazardous  substance"  under  Section 25281 of
the California  Health and Safety Code,  Division 20,  Chapter 6.7  (Underground
Storage of Hazardous Substances);

               (v) defined as a "waste" or "hazardous  substance"  under Section
13050 of the California Water Code, Division 7, Chapter 2 (Porter-Cologne  Water
Quality Control Act);

               (vi)  listed as a chemical  known to the State of  California  to
cause  cancer or  reproductive  toxicity  pursuant  to  Section  25249.8  of the
California Health and Safety Code, Division 20, Chapter 6.6 (Safe Drinking Water
and Toxic Enforcement Act of 1986);

               (vii)  defined  as  a  "hazardous  substance"  or  "pollutant  or
contaminant"  pursuant  to  Section  101  of  the  Comprehensive   Environmental
Response,  Compensation and Liability Act of 1980, as amended,  42 U.S.C.ss.9601
et seq.;

               (viii) listed as an "extremely hazardous  substance,"  "hazardous
chemical," or "toxic chemical"  pursuant to the Emergency Planning and Community
Right-to-Know Act of 1986, 42 U.S.C.ss.11001 et seq.;

               (ix)  listed as a  "hazardous  substance"  in the  United  States
Department of Transportation Table, 49 C.F.R. 172.101 and amendments thereto, or
by the  Environmental  Protection  Agency (or any successor agency) in 40 C.F.R.
Part 302 and amendments thereto;

               (x) defined,  listed or  designated  by  regulations  promulgated
pursuant to any Environmental Law; or

               (xi)  any  of  the  following:  pesticide;  flammable  explosive;
petroleum,   including   crude  oil  or  any  fraction   thereof;   asbestos  or
asbestos-containing material; polychlorinated biphenyl; radioactive material; or
urea formaldehyde.

     In addition to the foregoing,  the term  Environmental Laws shall be deemed
to  include,  without  limitation,  local,  state and federal  laws,  judgments,
ordinances,   orders,   rules,   regulations,   codes  and  other   governmental
restrictions,   guidelines  and  requirements,  any  amendments  and  successors
thereto,  replacements  thereof and publications  promulgated  pursuant thereto,
which deal with, or otherwise in any manner relate to, air or water quality, air
emissions, soil or ground conditions or other environmental matters of any kind.

          (b) Use,  etc. of Hazardous  Materials.  Lessee agrees that during the
Term, there shall be no use, presence, disposal, storage,  generation,  leakage,
treatment,  manufacture,  import,  handling,  processing,  release or threatened
release of  Hazardous  Materials  caused by Lessee on,  from or under the Leased
Premises  except to the extent that, and in accordance  with such conditions as,
Lessor may have previously  approved in writing.  The use,  presence,  disposal,
storage,  generation,   leakage,  treatment,   manufacture,   import,  handling,
processing,  release or threatened release of Hazardous  Materials by Lessee are

                                       18
<PAGE>
sometimes  hereinafter  individually or  collectively  referred to as "Hazardous
Use." It is further  Agreed that Lessee  shall be entitled to use and store only
those Hazardous  Materials which are necessary for Lessee's  business,  provided
that such usage and storage is in full compliance with  Environmental  Laws, and
all judicial and administrative  decisions pertaining thereto.  Lessee shall not
be entitled to install any tanks under,  on or about the Leased Premises for the
storage of Hazardous  Materials  without the express  written consent of Lessor,
which may be given or withheld in Lessor's sole arbitrary judgment.

          (c) Hazardous Materials Report; When Required . Lessee shall submit to
Lessor a written  report with respect to Hazardous  Materials  ("Report") in the
form prescribed in subparagraph (d) below on the following dates:

          (d) Hazardous  Materials Report,  Contents.  The Report shall contain,
without limitation, the following information:

               (i) Whether on the date of the Report and (if applicable)  during
the period  since the last Report there has been any  Hazardous  Use on, from or
under the Leased Premises.

               (ii) If there was such  Hazardous  Use, the exact identity of the
Hazardous  Materials,  the dates upon which such materials were brought upon the
Leased  Premises,  the dates upon which the  Hazardous  Materials  were  removed
therefrom, and the quantity, location, use and purpose thereof.

               (iii) If there was such Hazardous Use, any  governmental  permits
maintained  by Lessee  with  respect to such  Hazardous  Materials,  the issuing
agency,  original  date of issue,  renewal dates (if any) and  expiration  date.
Copies of any such permits and applications therefor shall be attached.

               (iv) If there was such Hazardous Use, any governmental  reporting
or  inspection  requirements  with  respect  to such  Hazardous  Materials,  the
governmental agency to which reports are made and/or which conducts inspections,
and the dates of all such reports and/or  inspections (if applicable)  since the
last Report. Copies of any such reports shall be attached.

               (v) Any  liability  insurance  carried by Lessee with  respect to
Hazardous  Materials,  the  insurer,  policy  number,  date of  issue,  coverage
amounts, and date of expiration.  Copies of any such policies or certificates of
coverage shall be attached.

               (vi) Any notices of violation of Environmental Laws at the Leased
Premises, written or oral, received by Lessee from any governmental agency since
the last Report, the date, name of agency, and description of violation.  Copies
of any such written notices shall be attached.

               (vii) Any knowledge,  information or  communication  which Lessee
has acquired or received relating to: (x) any enforcement,  cleanup,  removal or
other  governmental or regulatory  action threatened or commenced against Lessee
with respect to the Leased Premises pursuant to any Environmental  Laws; (y) any
claim made or  threatened by any person or entity  against  Lessee or the Leased
Premises  on account of any  alleged  loss or injury  claimed to result from any
alleged Hazardous Use on or about the Leased Premises; or (z) any report, notice
or  complaint  made to or filed  with any  governmental  agency  concerning  any
Hazardous Use on or about the Leased  Premises.  The Report shall be accompanied
by  copies  of any such  claim,  report,  complaint,  notice,  warning  or other
communication that is in the possession of or is available to Lessee.

                                       19
<PAGE>
          (e) Release of Hazardous  Materials:  Notification and Cleanup.  If at
any time  during  the Term  Lessee  knows or  believes  that any  release of any
Hazardous  Materials has come or will come to be located upon,  about or beneath
the Leased Premises, then Lessee shall immediately,  either prior to the release
or following the discovery thereof by Lessee,  give verbal and follow-up written
notice of that condition to Lessor.  Lessee  covenants to investigate,  clean up
and otherwise  remediate any release of Hazardous Materials caused by Lessee (or
Lessee's agents, contractors,  employees and representatives),  at Lessee's cost
and expense;  such  investigation,  clean-up and remediation  shall be performed
only after  Lessee has obtained  Lessor's  written  consent,  which shall not be
unreasonably  withheld;  provided,  however,  that  Lessee  shall be entitled to
respond  immediately to an emergency  without first obtaining  Lessor's  written
consent. Whenever the term "Lessee" is used in this Section 12 with respect to a
use or release of Hazardous Materials,  such term shall include Lessee's agents,
contractors,  employees and representatives.  All clean-up and remediation shall
be done in compliance with Environmental Laws and to the reasonable satisfaction
of Lessor.  Notwithstanding the foregoing,  whether or not such work is prompted
by the  foregoing  notice from Lessee or is  undertaken  by Lessor for any other
reason  whatsoever,  Lessor  shall have the right,  but not the  obligation,  in
Lessor's sole and absolute  discretion,  exercisable by written notice to Lessee
at any time,  to  undertake  within or outside  the Leased  Premises  all or any
portion of any investigation,  clean-up or remediation with respect to Hazardous
Materials for which Lessee is  responsible  (or, once having  undertaken  any of
such work, to cease same,  in which case Lessee shall perform the work),  all at
Lessee's  cost and  expense,  which shall be paid by Lessee as  additional  rent
within twenty (20) days after receipt of written request therefor by Lessor (and
which  Lessor  may  require  to be paid  prior  to  commencement  of any work by
Lessor). No such work by Lessor shall create any liability on the part of Lessor
to Lessee or any other party in  connection  with such  Hazardous  Materials  or
constitute  an  admission by Lessor of any  responsibility  with respect to such
Hazardous  Materials.  Lessee  shall not enter  into any  settlement  agreement,
consent decree or other  compromise  with respect to any claims  relating to any
Hazardous  Materials in any way connected to the Leased Premises  without first:
(i) notifying  Lessor of Lessee's  intention to do so and  affording  Lessor the
opportunity to participate in any such proceedings;  and (ii) obtaining Lessor's
reasonable written consent.

          (f) Inspection  and Testing by Lessor.  Lessor shall have the right at
all times  during the Term to: (i) upon  reasonable  prior  notice  inspect  the
Leased Premises,  as well as Lessee's books and records;  and (ii) conduct tests
and  investigations  to  determine  whether  Lessee  is in  compliance  with the
provisions  of this  Section.  Except in case of  emergency,  Lessor  shall give
reasonable  notice  to Lessee  before  conducting  any  inspections,  tests,  or
investigations. The cost of all such inspections, tests and investigations shall
be borne by Lessee, if Lessor reasonably believes them to be necessary.  Neither
any action nor inaction on the part of Lessor  pursuant to this Section  12.3(f)
shall be deemed in any -way to  release  Lessee  from,  or in any way  modify or
alter,  Lessee's  responsibilities,  obligations,  and/or  liabilities  incurred
pursuant to Section 12.3 hereof.

     12.4 Indemnity.  Lessee shall  indemnify,  hold harmless,  and, at Lessor's
option  (with such  attorneys  as Lessor may approve in advance and in writing),
defend  Lessor  and  Lessor's  officers,  directors,   shareholders,   trustees,
partners, employees,  contractors,  agents and mortgagees or other lien holders,
from and against  any and all claims,  demands,  expenses,  actions,  judgments,
damages (whether consequential,  direct or indirect, known or unknown,  foreseen
or unforeseen),  penalties, fines, liabilities,  losses of every kind and nature
(including, without limitation, property damage, diminution in value of Lessor's
interest  in the  Leased  Premises  or the  Complex,  damages  for  the  loss or
restriction  on use of any space or amenity  within the Leased  Premises  or the
Complex,  damages  arising  from any adverse  impact on  marketing  space in the
Complex, sums paid in settlement of claims and any costs and expenses associated
with  injury,  illness  or death  to or of any  person),  suits,  administrative
proceedings,  costs and fees,  including,  but not  limited to,  attorneys'  and
consultants' fees and expenses, and the costs of cleanup,  remediation,  removal
and restoration (all of the foregoing being hereinafter  sometimes  collectively
referred to as "Losses"),  arising from or related to any violation by Lessee of

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any of  the  requirements,  ordinances,  statutes,  regulations  or  other  laws
referred to in this Article, including, without limitation,  Environmental Laws,
any breach of the provisions of this Article,  or any Hazardous Use on, about or
from the Leased Premises caused by the acts or omissions of Lessee,  its agents,
employees and  contractors,  including  without  limitation any Hazardous Use or
release of Hazardous Materials,  after the Delivery Date until the expiration of
the Term.

     12.5 Release and Assumption of Risk.

          (a) Lessee,  for itself,  and its officers,  directors,  shareholders,
partners,  agents,  contractors,   attorneys,   brokers,  servants,   employees,
sublessees,  lessees, invitees,  concessionaires,  licensees and representatives
(hereinafter referred to as "Releasors"),  hereby waives, releases,  acquits and
forever discharges Lessor and its officers, directors,  trustees,  shareholders,
partners, agents, contractors, attorneys, brokers, servants, employees, lessees,
invitees, licensees and representatives (hereinafter referred to as "Releasees")
of and from any and all Losses, which are in any way connected with, based upon,
related to or arising out of (i) any Hazardous Use or Hazardous  Materials on or
about the Leased  Premises or the Complex,  (ii) any violation by or relating to
the Leased Premises or the Complex (or the ownership, use, condition,  occupancy
or operation thereof),  or by the Releasors or any other persons or entities, of
any Environmental or Wetlands Laws affecting the Leased Premises or the Complex,
or (iii) any investigation,  inquiry, order, hearing, action or other proceeding
by or before any governmental  agency or any court in connection with any of the
matters  referred to in clauses (i) or (ii) above  (collectively,  the "Released
Matters"),  except  to the  extent  caused by the gross  negligence  or  willful
misconduct of the Releasees.  Releasors hereby expressly assume any and all risk
of Losses based on or arising out of or pertaining to the Released Matters.

          (b) Lessee agrees,  represents and warrants that the Released  Matters
are not limited to matters which are known, disclosed or foreseeable, and Lessee
waives any and all rights and benefits which are conferred upon Lessee by virtue
of the provisions of Section 1542 of the California Civil Code, which provides:

          A GENERAL  RELEASE DOES NOT EXTEND TO CLAIMS  WHICH THE CREDITOR  DOES
          NOT KNOW OR SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF EXECUTING THE
          RELEASE,  WHICH  IF KNOWN BY HIM MUST  HAVE  MATERIALLY  AFFECTED  HIS
          SETTLEMENT WITH THE DEBTOR.

          (c) Lessee  agrees,  represents and warrants that it is familiar with,
has read,  understands,  and has  consulted  legal  counsel of its choosing with
respect  to  California   Civil  Code  Section  1542  and  Lessee  realizes  and
acknowledges  that  factual  matters now  unknown to it may have  given,  or may
hereinafter give, rise to Losses which are presently unknown,  unanticipated and
unsuspected.  Lessee further agrees, represents and warrants that the provisions
of this  Section  12.5 have been  negotiated  and  agreed  upon in light of that
realization and that Lessee  nevertheless  hereby intends to release,  discharge
and acquit  the  Releasees  from any such  unknown  Losses  which are in any way
related to this Lease or the Complex.

     12.6 Indoor Air Quality.  To prevent the  generation,  growth or deposit of
any mold, mildew, bacillus, virus, pollen or other microorganism  (collectively,
"Biologicals")   and  the  deposit,   release  or   circulation  of  any  indoor
contaminants,  including,  but not limited to, emissions from paint,  carpet and
drapery  treatments,   cleaning,  maintenance  and  construction  materials  and
supplies,  pesticides,  pressed  wood  products,  insulation,  tobacco and other
materials and products  (collectively  with Biologicals,  "Contaminants"),  that
could adversely affect the health, safety or welfare of any tenant, employee, or
other occupant of the Complex or their invitees (each,  an  "Occupant"),  Lessee
shall,  at Lessee's  sole cost and expense,  at all times  during the Term:  (i)
maintain,  operate and repair the HVAC system  servicing the Leased Premises (to

                                       21
<PAGE>
the extent that  Lessee is  otherwise  obligated  to perform  such  maintenance,
operation  and  repair  pursuant  to this  Lease)  in a manner  consistent  with
preventing or minimizing the generation, growth, circulation, release or deposit
of any Contaminants;  (ii) maintain the humidity level and the air exchange rate
within the Leased Premises (to the extent that Lessee has control  thereof) at a
level  recommended to prevent or minimize the growth of any  Biologicals and the
circulation of any other  Contaminants;  (iii) maintain,  operate and repair the
Leased  Premises in such a manner to prevent or  minimize  the  accumulation  of
stagnant  water and  moisture  in  planters,  kitchen  appliances  and  vessels,
carpeting,  insulation,  water coolers and any other  locations  where  stagnant
water and moisture could accumulate;  and (iv) otherwise  maintain,  operate and
repair the Leased Premises to prevent the generation,  growth, deposit,  release
or circulation of any Contaminants. If any governmental entity alleges to Lessee
that health,  safety or welfare has been or could be  adversely  affected by any
such  Contaminants,  Lessee  shall ' notify  Lessor in  writing  within  one (1)
business day of the time the allegation is made. Lessor may then elect to engage
the services of an industrial  hygiene testing  laboratory (or  alternatively or
concurrently  require  Lessee to do the same) to determine  whether the cause of
any  alleged   adverse  health  effect  is  or  could  be  attributable  to  any
Contaminants present within the Leased Premises. Lessee shall be responsible for
all such testing costs and for any  consequential  damages and costs (including,
without limitation, any third-party claims, loss of rental, remediation, removal
and/or  abatement  costs,  and increases in insurance  premiums)  resulting from
Lessee's  failure  to comply in whole or in part with the terms of this  Section
12.7.  The  indemnity  set forth in Section  12.5 above  shall apply to Lessee's
failure to comply with any of the terms of this Section.

                            13. SERVICE AND EQUIPMENT

     13.1  Climate  Control.  Lessor shall  provide as part of  Operating  Costs
ventilating and air  conditioning  ("VAC") to the Leased Premises from 8:00 a.m.
to 6:00 p.m.,  Monday  through  Friday and 8:00 a.m. to 1:00 p.m.  Saturday (the
"Climate  Control Hours") provided that Lessor shall have no  responsibility  or
liability for failure to supply VAC service when making repairs,  alterations or
improvements  or when  prevented  from so doing by strikes  or any cause  beyond
Lessor's  reasonable control or as provided in Section 13.6. Any VAC provided to
the Leased Premises at Lessee's request after the Climate Control Hours shall be
at Lessee's sole cost and expense in accordance with rate schedules  promulgated
by Lessor from time to time.  Lessee  acknowledges  that Lessor has installed in
the Building a system for the purpose of climate control.  Initially, the use of
fans to  circulate  outside  air or in  conjunction  with  the  climate  control
equipment  outside of the Climate  Control Hours shall be charged at Twenty-Four
Dollars ($24) per hour for each additional fan, and the use of chillers  outside
of the  Climate  Control  Hours shall be charged at One  Hundred  Fifty  Dollars
($150) per hour,  each prorated among those lessees  requiring  such  additional
hours of climate  control.  Any use of the Leased  Premises  which  exceeds  the
Building  design load standards may require changes or alterations in the system
or ducts  through  which the climate  control  system  operates.  Any changes or
alterations  so  occasioned,  if such  changes can be  accommodated  by Lessor's
equipment,  shall be made by  Lessee at its cost and  expense  but only with the
written  consent  of  Lessor  first had and  obtained,  and in  accordance  with
drawings and  specifications  and by a contractor  first  approved in writing by
Lessor.  If Lessee's use of the Leased Premises exceeds the Building design load
standards,  such  excess use may  necessitate  the  re-balancing  of the climate
control  equipment  in the  Leased  Premises.  In such  event,  the same will be
performed  by Lessor  at  Lessee's  expense.  Any  charges  to be paid by Lessee
hereunder  shall be due  within  ten (10) days of  receipt  of an  invoice  from
Lessor,  which  invoice  may  precede  Lessor's  expenditure  for the benefit of
Lessee.

     13.2  Elevator  Service.  Subject to Section  13.6,  Lessor  shall  provide
reasonable  elevator  service (which may be with or without operator at Lessor's
option) on a twenty-four  (24) hour basis,  three hundred  sixty-five (365) days
per year.

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<PAGE>
     13.3 Cleaning Public Areas. Lessor shall maintain and keep clean the street
level lobbies, sidewalks, truck dock, public corridors and other public portions
of the Building.

     13.4 Refuse  Disposal.  Lessee  shall pay  Lessor,  within ten (10) days of
being billed therefor, for the removal from the Leased Premises and the Building
of such refuse and rubbish of Lessee as shall exceed that ordinarily accumulated
daily in the routine of business office occupancy.

     13.5  Janitorial  Service.  Lessor shall  provide  cleaning and  janitorial
service in and about the Complex and Leased  Premises in accordance with Exhibit
H, attached hereto.

     To the extent that Lessee shall require cleaning and/or janitorial  service
in excess of that set forth in Exhibit H  (hereinafter  referred  to as "Special
Cleaning Service") Lessor may, upon reasonable advance notice from Lessee, elect
to furnish such Special Cleaning Service and Lessee agrees to pay Lessor, within
ten (10) days of being billed therefor, Lessor's reasonable charge for providing
such  additional  service.  If Lessor  does not elect to  provide  said  Special
Cleaning  Service,  Lessee  may  perform or provide  for said  Special  Cleaning
Service, at Lessee's sole cost and expense.

     13.6  Interruptions.  Lessor  does not  warrant  that  any of the  services
referred to above or any other services and/or utilities which Lessor may supply
or are supplied will be free from  interruption  and/or the need for maintenance
and  repairs  or  replacement.  Lessee  acknowledges  that any one or more  such
services  may be  suspended  or reduced  by reason of  repairs,  alterations  or
improvements necessary to be made, by strikes or accidents,  by any cause beyond
the  reasonable  control of Lessor,  or by orders or regulations of any federal,
state,  county  or  municipal  authority.  In  addition,  Lessor  shall  have no
liability for damages  arising  from,  and Lessor does not warrant that Lessee's
use of any Lines will be free from: (i) any  eavesdropping  or  wire-tapping  by
unauthorized  parties;  (ii)  any  failure  of any  Lines  to  satisfy  Lessee's
requirements;  or (iii)  any  shortages,  failures,  variations,  interruptions,
disconnections, loss or damage caused by installation, maintenance, replacement,
use or removal of Lines by or for other occupants of the Complex, by any failure
of the environmental  conditions or the power supply for the Building to conform
to any  requirements  for the  Lines or any  associated  equipment  or any other
problems associated with any Lines by any other cause.

     Any such  interruption  or  suspension  of services  shall not be deemed an
eviction or disturbance of Lessee's use and possession of the Leased Premises or
any part thereof, nor render Lessor liable to Lessee for damages by abatement of
Rent or otherwise,  nor relieve Lessee of  performance  of Lessee's  obligations
under this Lease.

     13.7 Electrical Service. Lessee, at its own cost and expense, shall install
a meter or check meter to monitor all  electricity  used by Lessee in the Leased
Premises.  Lessee shall pay all  electricity  charges  applicable  to the Leased
Premises.

     13.8 Building Upgrade Work.  Lessor has advised Lessee that Lessor may make
certain upgrades and improvements to the Common Areas and central systems of the
Complex ("Building Upgrade Work").  Lessee  acknowledges that the performance of
the  Building  Upgrade  Work may  result  in  noise,  dust and  other  temporary
inconveniences  or interruptions  to the conduct of normal business  activity in
the  Building.  Lessor will utilize  reasonable  measures to reduce noise levels
associated with the performance of the Building Upgrade Work; provided, however,
the Building Upgrade Work shall in no event  constitute a constructive  eviction
or serve as a basis for any abatement or reduction in rent.

                                       23
<PAGE>
                                    14. WASTE

     14.1 Waste or Nuisance. Lessee shall not commit, or suffer to be committed,
any waste upon the Leased Premises, or any nuisance, or other act or thing which
may disturb the quiet  enjoyment  of any other lessee or occupant of the Complex
in which the Leased Premises are located.

                                 15. ALTERATIONS

     15.1 Consent of Lessor;  Ownership.  Lessee shall not make, or suffer to be
made, any  Alterations  to the Leased  Premises,  the Building,  or the Complex,
and/or Lines,  systems and facilities therein, or any part thereof,  without the
written  consent  of  Lessor  first  had  and  obtained.  Any  additions  to  or
Alterations of the Leased Premises  (except trade fixtures)  shall,  immediately
upon being made,  constitute  a part of the realty and  Lessor's  property,  and
shall, at the expiration or earlier  termination of this Lease,  remain upon the
Leased Premises without compensation to Lessee.  Attached hereto as Exhibit K is
a list of Tenant's  trade  fixtures.  Lessee  shall have the right to remove its
trade fixtures placed upon the Leased Premises provided that Lessee restores the
Leased  Premises  as  indicated  below.  Any and all costs  incurred  by Lessor,
whether in complying with laws,  governmental  requirements  or otherwise,  as a
result of any  Alterations,  or as a result of request  by Lessee for  increased
Lines or other utility  capacity above that presently  existing shall be paid by
Lessee within ten (10) days after demand therefor by Lessor.

     15.2  Lessee  Alterations.  Any  alterations,  additions,  improvements  or
installations  performed by Lessee (collectively  "Alteration" or "Alterations")
shall be subject to strict conformity with the following requirements:

          (a) All Alterations shall be at the sole cost and expense of Lessee;

          (b) Prior to  commencement  of any work of  Alteration,  Lessee  shall
submit   detailed  plans  and   specifications,   including   working   drawings
(hereinafter referred to as "Plans"),  of the proposed Alterations,  which shall
be subject to the consent of Lessor in accordance with the terms of Section 15.1
above;

          (c)  Following  approval  of the Plans by  Lessor,  Lessee  shall give
Lessor at least ten (10) days' prior written notice of  commencement  of work in
the Leased Premises so that Lessor may post notices of  non-responsibility in or
upon the Leased Premises as provided by law;

          (d) No Alterations shall be commenced without Lessee having previously
obtained all appropriate  permits and approvals  required by and of governmental
agencies;

          (e) All  Alterations  shall be performed in a skillful and workmanlike
manner,  consistent  with the  Building  Standards  set forth as  Exhibit G, and
pursued  with  diligence in  accordance  with the Plans  previously  approved by
Lessor and in full accord with all applicable laws and ordinances. All material,
equipment,  and articles  incorporated  in the  Alterations are to be new and of
recent  manufacture  and of the most  suitable  grade for the purpose  intended.
Lessee's  contractor shall maintain all of the insurance  reasonably required by
Lessor, including,  without limitation,  commercial general liability,  workers'
compensation, builder's risk and course of construction insurance. The limits of
such insurance shall be the same as those specified in Article 18;

          (f) Lessee  must  obtain the prior  written  approval  from Lessor for
Lessee's contractor before the commencement of the work. Lessor may require that
Lessee use  subcontractors  designated by Lessor as to specified portions of the
work;

                                       24
<PAGE>
          (g) As a condition of approval of the Alterations,  Lessor may require
performance  and  labor  and  materialmen's  payment  bonds  issued  by a surety
approved by Lessor,  in a sum equal to the cost of the  Alterations  guarantying
the completion of the Alterations  free and clear of all liens and other charges
in accordance with the Plans. Such bonds shall name Lessor as beneficiary;

          (h) The Alterations  must be performed in a manner such that they will
not interfere with the quiet enjoyment of the other lessees in the Complex;

          (i)  Lessor  shall have the right to  condition  any  approval  of the
Alterations  upon (i) submission by Lessee of a Report with respect to Hazardous
Materials, and/or (ii) the performance by Lessee at Lessee's cost and expense of
such investigation, clean-up and remediation with respect to Hazardous Materials
as Lessor may  request,  in Lessor's  sole and  absolute  discretion;  provided,
however, that Lessor shall have the right, but not the obligation,  to undertake
all or any portion of such  investigation,  clean-up or  remediation at Lessee's
cost and expense in accordance  with the  provisions of Section  12.3(e)  above.
Lessee acknowledges and agrees that Lessor shall have the right, in its sole and
absolute discretion, to disapprove the making of any such Alterations based upon
the results of any investigation  with respect to Hazardous  Materials,  and the
impact of such Alterations on the presence of Hazardous Materials.

     15.3 Liens.  Lessee shall keep the Leased Premises and the Complex in which
the Leased  Premises  are situated  free from any liens  arising out of any work
performed, materials furnished or obligations incurred by Lessee. In the event a
mechanic's or other lien is filed against the Leased  Premises or the Complex of
which the Leased  Premises  form a part as a result of a claim  arising  through
Lessee,  Lessor  may  demand  that  Lessee  furnish  to  Lessor  a  surety  bond
satisfactory  to Lessor in an amount equal to at least one hundred fifty percent
(150%) of the amount of the contested lien claim or demand,  indemnifying Lessor
against  liability  for the same and holding the Leased  Premises  free from the
effect  of such lien or claim.  Such  bond must be posted  within  ten (10) days
following  notice from  Lessor.  In addition,  Lessor may require  Lessee to pay
Lessor's  attorneys' fees and costs in  participating in any action to foreclose
such lien if Lessor shall decide it is to its best interest to do so. Lessor may
pay the claim prior to the  enforcement  thereof,  in which event  Lessee  shall
reimburse Lessor in full,  including  attorneys' fees, for any such expense,  as
additional rent, with the next due rental.

     15.4 Restoration.  Lessee shall, at Lessee's sole cost and expense,  return
the Leased  Premises to Lessor at the expiration or earlier  termination of this
Lease in good and  sanitary  order,  condition  and  repair,  free of rubble and
debris,  broom clean,  reasonable  wear and tear excepted.  In addition,  within
thirty  (30) days after  request of Lessee,  Lessor  shall  notify  Lessee as to
whether Lessor considers any such Alterations to be specialized and non-reusable
areas,  such as classrooms,  manufacturing  areas and storage racks, and whether
Lessor desires such  specialized and  non-reusable  areas of the Leased Premises
restored to its condition prior to the making of such permitted Alterations.  In
the event Lessor requires  restoration,  Lessor shall, at least three (3) months
prior to Lease  expiration,  provide  Lessee with an estimate of the costs to so
restore  the Leased  Premises  ("Restoration  Costs")  and  Lessee  shall pay to
Lessor,  as additional Rent, the entire amount of the Restoration Costs no later
than ten (10) days prior to Lease expiration.  The foregoing  restoration of the
Leased Premises shall be performed after the Lease expiration. All damage to the
Leased  Premises caused by the removal of such trade fixtures and other personal
property that Lessee is permitted to remove under the terms of this Lease and/or
such restoration  shall be repaired by Lessee at its sole cost and expense prior
to termination.  Lessee's obligations under this Section 15.4 shall apply to the
parking  garage,  roof and other areas of the Complex  impacted by Lessee's  use
and/or occupancy of the Complex or any part thereof.

                                       25
<PAGE>
                             16. PROPERTY INSURANCE

     16.1 Lessor's Insurance. Lessor shall, to the extent available, procure and
maintain at all times during the Term an "All Risk" or "Special  Form" policy or
policies of insurance covering loss or damage to the Building and the Complex in
an amount sufficient to exceed minimum  coinsurance  requirements of such policy
(exclusive of Lessee's trade  fixtures,  inventory,  personal  property,  Tenant
Improvements and equipment),  providing  protection  against all perils included
within the classification of fire and extended coverage,  vandalism coverage and
malicious  mischief,  sprinkler  leakage,  water  damage,  and special  extended
coverage on  Building.  Additionally,  Lessor may (but shall not be required to)
carry: (i) bodily injury and property damage  liability  insurance and/or excess
liability coverage insurance;  (ii) earthquake and/or flood damage insurance; or
(iii) rental income  insurance at Its election or if required by its lender from
time to time  during  the  Term;  or (iv) any other  insurance  as Lessor or its
lender  reasonably  deem  appropriate,  in such  amounts and with such limits as
Lessor or its lender may deem appropriate. The costs of all such insurance shall
be included in Operating Costs.

     16.2  Use of  Premises.  No use  shall be made or  permitted  to be made by
Lessee on the Leased  Premises,  nor acts done, which will increase the existing
rate of insurance upon the Building in which the Leased  Premises are located or
upon any other Building the Complex or cause the  cancellation  of any insurance
policy  covering the Building,  or any part  thereof,  nor shall Lessee sell, or
permit to be kept,  used or sold, in or about the Leased  Premises,  any article
which may be  prohibited  by the  standard  form of "All  Risk"  fire  insurance
policies.  Lessee shall,  at its sole cost and expense,  comply with any and all
requirements pertaining to the Leased Premises, of any insurance organization or
company,  necessary  for the  maintenance  of  reasonable  property  damage  and
commercial  general  liability  insurance,  covering  the Leased  Premises,  the
Building, or the Complex.

     16.3 Increase in Premiums.  Lessee  agrees to pay to Lessor,  as additional
Rent, any increase in premiums on policies which may be carried by Lessor on the
Leased  Premises,  the Building or the Complex,  or any blanket  policies  which
include the Building or Complex, covering damage thereto and loss of Rent caused
by fire and  other  perils  above the  rates  for the  least  hazardous  type of
occupancy for office use.  Lessee  further  agrees to pay Lessor,  as additional
Rent,  any  increases  in such  premiums  resulting  from the nature of Lessee's
occupancy or any act or omission of Lessee.  All payments of additional  Rent by
Lessee to Lessor  pursuant  to this  Section  16.3 shall be made within ten (10)
days after receipt by Lessee of Lessor's billing therefor.

     16.4 Personal Property  Insurance.  Lessee shall maintain in full force and
effect on all of its fixtures, furniture,  equipment and other business personal
property  in the  Leased  Premises  a policy or  policies  providing  protection
against any peril included within the classification "All Risk" to the extent of
at least ninety percent (90%) of their  replacement  cost, or that percentage of
the replacement  cost required to negate the effect of a coinsurance  provision,
whichever is greater. No such policy shall have a deductible in a greater amount
than One Thousand Dollars ($1,000).  Lessee shall also insure in the same manner
the physical value of all its Tenant  Improvements and Alterations in the Leased
Premises  including the Lessee's  Work.  During the Term,  the proceeds from any
such policy or policies of insurance shall be used for the repair or replacement
of the fixtures,  equipment,  and Tenant  Improvements so insured.  Lessor shall
have no interest in said  insurance,  and will sign all  documents  necessary or
proper in connection with the settlement of any claim or loss by .Lessee. Lessee
shall also maintain insurance for all plate glass upon the Leased Premises.  All
insurance  specified in this Section  16.4 to be  maintained  by Lessee shall be
maintained by Lessee at its sole cost.

              17 INDEMNIFICATION, WAIVER OF CLAIMS AND SUBROGATION

     17.1 Waiver of Subrogation. Lessor and Lessee release each other, and their
respective authorized representatives,  from any claims for damage to the Leased
Premises and the Building and other  improvements  in which the Leased  Premises
are  located,  and to the  furniture,  fixtures,  and  other  business  personal
property,  Lessee's  improvements and Alterations of either Lessor or Lessee, in

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or on the Leased  Premises and the Building and other  improvements in which the
Leased  Premises are located,  including  loss of income,  that are caused by or
result  from  risks  insured  or  required  under the terms of this  Lease to be
insured against under any property  insurance  policies carried or to be carried
by either of the parties.

     17.2 Form of Policy.  Each party  shall  cause each such  insurance  policy
obtained  by it to  provide  that the  insurance  company  waives  all rights of
recovery by way of  subrogation  against  either  party in  connection  with any
damage  covered by such policy.  Neither  party shall be liable to the other for
any damage caused by any peril  included  within the  classification  "All Risk"
which is insured against under any property  insurance  policy carried under the
terms of this Lease.

     17.3  Indemnity.  Lessee,  as a material  part of the  consideration  to be
rendered to Lessor,  shall indemnify,  defend,  protect and hold harmless Lessor
against all actions, claims, demands, damages,  liabilities,  losses, penalties,
or  expenses  of any kind which may be brought or imposed  upon  Lessor or which
Lessor may pay or incur by reason of injury to person or property  or  business,
from whatever  cause,  all or in any way connected with the acts ' and omissions
of Lessee, and the condition or use of the Leased Premises,  or the improvements
or  personal  property  therein or thereon,  including  without  limitation  any
liability or injury to the person or property or business of Lessee, its agents,
officers,  employees or invitees. Lessee agrees to indemnify, defend and protect
Lessor and hold it harmless from any and all liability, loss, cost or obligation
on account  of, or arising out of, any such  injury or loss  however  occurring,
including  breach of the  provisions  of this  Lease and the  negligence  of the
parties  hereto.  Nothing  contained  herein shall obligate  Lessee to indemnify
Lessor  against its own  negligence  or willful  acts,  for which  Lessor  shall
indemnify Lessee.

     17.4  Defense of Claims.  In the event any action,  suit or  proceeding  is
brought against Lessor by reason of any such occurrence,  Lessee,  upon Lessor's
request,  will at  Lessee's  expense  resist and  defend  such  action,  suit or
proceeding,  or cause the same to be resisted and defended by counsel designated
either by Lessee or by the insurer  whose policy  covers the  occurrence  and in
either case  approved by Lessor.  The  obligations  of Lessee under this Section
arising by reason of any  occurrence  taking place during the Term shall survive
any termination of this Lease.

     17.5 Waiver of Claims.  Lessee,  as a material part of the consideration to
be rendered to Lessor,  hereby waives all claims  against  Lessor for damages or
injury, as described below, from any cause arising at any time, including breach
of the provisions of this Lease and the negligence of the parties hereto:

          (a) damages to goods, wares, merchandise and loss of business in, upon
or about the Leased Premises; and

          (b) (notwithstanding anything to the contrary contained in this Lease,
including, without limitation, the definition of Operating Costs in Section 2.1,
which includes  "policing")  damages to goods,  wares,  merchandise  and loss of
business,  in, upon or about the Leased  Premises or the Complex,  and injury to
Lessee,  its agents,  employees  invitees or third persons in, upon or about the
Leased  Premises  or the  Complex,  where  such  damage or injury  results  from
Lessor's  failure  to police or provide  security  for the  Complex or  Lessor's
negligence in connection therewith.

     Lessee  expressly  acknowledges  and agrees that the  provisions of Section
12.5(b)  above apply fully with respect to the matters  waived  pursuant to this
Section 17.5,  and, for such  purpose,  the term  Released  Matters,  as used in
Section 12.5(b),  shall be deemed to include the matters waived pursuant to this
Section 17.5.

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<PAGE>
     17.6 References. Wherever in this Article the term Lessor or Lessee is used
and such  party is to  receive  the  benefit of a  provision  contained  in this
Article,  such term shall refer not only to that party but also to its officers,
directors, shareholders, employees, contractors, partners, agents and mortgagees
or other lien holders.

                             18. LIABILITY INSURANCE

     18.1 Lessee's Insurance. Lessee shall, at Lessee's expense, obtain and keep
in force  during the Term,  a  commercial  general  liability  insurance  policy
insuring  Lessee  against  the risks of,  bodily  injury  and  property  damage,
personal  injury,   contractual   liability,   completed  operations,   products
liability,  host liquor  liability,  owned and  non-owned  automobile  liability
arising  out of the  ownership,  use,  occupancy  or  maintenance  of the Leased
Premises and all areas appurtenant  thereto.  Such insurance shall be a combined
single limit policy in an amount not less than One Million Dollars  ($1,000,000)
per occurrence with a Two Million Dollar ($2,000,000)  annual aggregate;  and an
umbrella  policy of Three Million Dollars  ($3,000,000)  for any one occurrence.
Lessor and any lender or other party in interest  designated  by Lessor shall be
named as  additional  insured(s).  The  policy  shall  contain  cross  liability
endorsements and shall insure performance by Lessee of the indemnity  provisions
of this Lease;  shall be primary,  not  contributing  with, and not in excess of
coverage which Lessor may carry; shall state that Lessor is entitled to recovery
for the  negligence  of Lessee  even  though  Lessor  is named as an  additional
insured;  shall provide for severability of interest;  shall provide that an act
or  omission of one of the insured or  additional  insureds  which would void or
otherwise  reduce  coverage  shall not void or reduce  coverages as to the other
insured or  additional  insured;  and shall afford  coverage  after the Term (by
separate  policy  or  extension  if  necessary)  for all  claims  based on acts,
omissions,  injury  or  damage  which  occurred  or arose (or the onset of which
occurred  or arose) in whole or in part  during  the  Term.  The  limits of said
insurance shall not limit any liability of Lessee hereunder. Not more frequently
than every three (3) years, if, in the reasonable  opinion of Lessor, the amount
of liability insurance required hereunder is not adequate, Lessee shall promptly
increase said insurance coverage as required by Lessor.

     18.2  Workers'   Compensation   Insurance.   Lessee  shall  carry  Workers'
Compensation  insurance as required by law,  including an  employers'  liability
endorsement.

     18.3 Rent Loss/Business  Interruption Insurance.  Lessee shall carry Rental
Loss/Business   Interruption   insurance   covering   rental  loss  or  business
interruptions  resulting  from those  risks  referred  to in Section  18.1 in an
amount  equal to all Rent  payable  under this Lease for a period of twelve (12)
months at the then current rate of charges.

                        19. INSURANCE POLICY REQUIREMENTS

     19.1 General Requirements. All insurance policies required to be carried by
Lessee (except Lessee's business personal  property  insurance)  hereunder shall
conform to the following requirements:

          (a) The  insurer in each case  shall  carry a  designation  in "Best's
Insurance  Reports" as issued from time to time  throughout the Term as follows:
policyholders' rating of A; financial rating of not less than VII;

          (b) The  insurer  shall be  qualified  to do  business in the state in
which the Leased Premises are located;

          (c) The policy shall be in a form and include such endorsements as are
acceptable to Lessor;

          (d)  Certificates  of  insurance  shall  be  delivered  to  Lessor  at
commencement  of the Term and  certificates of renewal at least thirty (30) days
prior to the expiration of each policy;

          (e) Each policy  shall  require  that Lessor be notified in writing by
the insurer at least thirty (30) days prior to any cancellation or expiration of
such policy, or any reduction in the amounts of insurance carried.

                          20. LESSEE INSURANCE DEFAULT

     20.1  Rights  of  Lessor.  In the event  that  Lessee  falls to obtain  any
insurance  required  of it under the terms of this  Lease,  Lessor  may,  at its
option,  but is not obligated to, obtain such  insurance on behalf of Lessee and
bill Lessee,  as additional  rent,  for the cost  thereof.  Payment shall be due
within ten (10) days of receipt of the billing therefor by Lessee.

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<PAGE>
                  21. FORFEITURE OF PROPERTY AND LESSOR'S LIEN

     21.1  Removal of Personal  Property.  Lessee  agrees that as of the date of
termination of this Lease or repossession  of the Leased Premises by Lessor,  by
way of default or otherwise,  it shall remove all personal  property to which it
has the right to ownership pursuant to the terms of this Lease. Any and all such
property  of Lessee  not  removed by such date  shall,  at the option of Lessor,
irrevocably  become the sole  property  of Lessor.  Lessee  waives all rights to
notice and all common law and statutory claims and causes of action which it may
have against Lessor subsequent to such date as regards the storage, destruction,
damage, loss of use and ownership of the personal property affected by the terms
of this Article.  Lessee acknowledges Lessor's need to relet the Leased Premises
upon  termination  of this  Lease or  repossession  of the Leased  Premises  and
understands  that the forfeitures  and waivers  provided herein are necessary to
aid said  reletting,  and to prevent  Lessor  incurring a loss for  inability to
deliver the Leased Premises to a prospective lessee.

                           22. MAINTENANCE AND REPAIRS

     22.1 Lessor's  Obligations.  Subject to the other  provisions of this Lease
imposing obligations in this respect upon Lessee,  Lessor shall repair,  replace
and maintain in  commercially  reasonable  condition the external and Structural
parts of the Complex which do not comprise a part of the Leased Premises and are
not leased to others, janitor and equipment closets and shafts within the Leased
Premises designated by Lessor for use by it in connection with the operation and
maintenance  of the Complex,  and all Common  Areas.  Lessor shall  maintain and
repair equipment,  Lines, facilities or systems of the Building or Complex which
are outside of the Leased Premises or which do not exclusively  serve the Leased
Premises.  Lessor shall perform such repairs,  replacements and maintenance with
reasonable  dispatch,  in a good and workmanlike manner; but Lessor shall not be
liable for any damages,  direct,  indirect or consequential,  or for damages for
personal discomfort,  illness or inconvenience of Lessee by reason of failure of
equipment,  Lines, facilities or systems or reasonable delays in the performance
of such repairs,  replacements and maintenance,  unless caused by the negligence
of Lessor,  its  servants,  agents,  or  employees.  The cost for such  repairs,
maintenance and  replacement  shall be included in Operating Costs in accordance
with Section 2.1 hereof.

     22.2  Negligence of Lessee.  If the Building,  the  elevators,  escalators,
boilers,  engines, pipes or apparatus used for the purpose of climate control of
the Building or operating the elevators,  or escalators,  or if the water pipes,
drainage pipes,  electric  lighting or other  equipment,  Lines,  systems and/or
facilities  of the Building or the Complex,  or the roof or the outside walls of
the  Building,  fall into a state of  disrepair  or become  damaged or destroyed
through the negligence,  carelessness or misuse of Lessee, its agents, employees
or anyone  permitted by it to be in the  Complex,  or through it in any way, the
cost of the necessary  repairs,  replacements  or Alterations  shall be borne by
Lessee who shall pay the same to Lessor as  additional  charges  within ten (10)
days of demand by Lessor.

     22.3  Lessee's  Obligations.  Lessee  shall  repair  the  Leased  Premises,
including  without  limiting  the  generality  of the  foregoing,  all  interior
partitions and walls,  fixtures,  Leasehold  Improvements and Alterations in the
Leased Premises and all electrical and telephone outlets and conduits,  fixtures
and shelving, and special mechanical and electrical equipment which equipment is
not a normal part of the Leased Premises installed by or for Lessee,  reasonable
wear and tear,  damage with respect to which Lessor has an  obligation to repair
as provided  in Section  22.1 and Section  23.2 hereof only  excepted.  Prior to
commencement  of any  repairs,  Lessee shall give Lessor at least ten (10) days'
prior   written   notice   thereof   so  that   Lessor   may  post   notices  of
non-responsibility  in or upon the Leased  Premises as  provided by law.  Lessee
must  obtain the prior  written  approval  from Lessor for  Lessee's  contractor
before the  commencement  of the repair.  Lessor may  require  that Lessee use a
specific contractor for certain types of repairs.  Lessor may enter and view the
state  of  repair  and  Lessee  will  repair  in a good and  workmanlike  manner

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<PAGE>
according to notice in writing.  Notwithstanding the foregoing, Lessee shall not
make any repairs to the equipment,  Lines, facilities or systems of the Building
or Complex which are outside of the Leased  Premises or which do not exclusively
serve the Leased Premises.

     22.4  Cleaning.  Lessee agrees at the end of each business day to leave the
Leased  Premises  in a  reasonably  clean  condition  for  the  purpose  of  the
performance  of Lessor's  cleaning  services  referred to herein.  Lessee  shall
maintain the appearance of the Leased  Premises in a manner  consistent with the
character,  use and  appearance  of the Complex.  Lessor  shall follow  Lessee's
security guidelines with respect to janitorial services, or, at Lessor's option,
Lessor shall require Lessee to be responsible for its own janitorial service.

     22.5 Waiver. Lessee waives all rights it may have under law to make repairs
at Lessor's expense.

     22.6 Acceptance.  Except as to the  construction  obligations of Lessor for
the  Lessor's  Work,  if any,  stated in Exhibit D to this Lease,  Lessee  shall
accept the Leased  Premises in "as is"  condition as of the date of execution of
this Lease by Lessee,  and Lessee  acknowledges that the Leased Premises in such
condition  are  in  good  and  sanitary  order,  condition  and  repair.  Lessee
acknowledges   that  generally  there  shall  be  no  floor/ceiling   coring  or
penetrations  due to the  post  tension  floor  slab  structural  system  of the
Building.   However,  Lessor  agrees  that  Lessee  may  undertake  corings  for
installation  of its vault  subject to prior  written  approval by Lessor of the
location, size and type of corings.

                                 23. DESTRUCTION

     23.1 Rights of Termination. In the event the Leased Premises suffers (a) an
Uninsured  Property Loss (as  hereinafter  defined) or (b) a property loss which
cannot  be  repaired  within  one  hundred  twenty  (120)  days from the date of
destruction  under  the  laws and  regulations  of  state,  federal,  county  or
municipal  authorities,  or other  authorities  with  jurisdiction,  Lessor  may
terminate  this Lease as at the date of the damage upon written notice to Lessee
following the property  loss.  For purposes of this Lease,  the term  "Uninsured
Property  Loss"  shall  mean any loss  arising  from a peril not  covered by the
standard form of an "All Risk" or "Special Form" property insurance policy.

     23.2 Repairs.  In the event of a property loss which may be repaired within
one  hundred  twenty  (120)  days  from  the  date  of the  damage,  or,  in the
alternative,  in the event Lessor does not elect to  terminate  this Lease under
the terms of Section  23.1 above,  then this Lease shall  continue in full force
and  effect  and  Lessor  shall  forthwith  undertake  to make such  repairs  to
reconstitute  the Leased  Premises to as near the  condition as existed prior to
the property loss as practicable but not including any  construction  originally
performed by Lessee  (including  Lessee's  Work) or  subsequently  undertaken by
Lessee,  but shall include  solely  property  constructed  by Lessor  (including
Lessor's Work) prior to the commencement of the Term.  Notwithstanding  anything
to the contrary  contained  herein, in the event of a property loss which is not
repaired  by Lessor  within two  hundred ten (210) days from the date of damage,
Lessee should have the right to terminate this Lease by written notice to Lessor
within thirty (30) days after the aforesaid 210-day period but in no event later
than Lessor's  completion of repairs.  Such partial  destruction shall in no way
annul or void this Lease except that Lessee shall be entitled to a proportionate
reduction of Minimum  Rent  following  the property  loss and until the time the
Leased  Premises are restored.  Such reduction  shall be pro rata based upon the
number of usable  square feet of the Leased  Premises  damaged and not occupied.
Lessor's  obligations  to  restore  shall  in no way  include  any  construction
originally  performed by Lessee or subsequently  undertaken by Lessee, but shall
include solely that property  constructed by Lessor prior to commencement of the
Term,

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<PAGE>
     23.3 Repair Costs.  The cost of any repairs to be made by Lessor,  pursuant
to  Section  23.2 of this  Lease,  shall be paid by Lessor  utilizing  available
insurance proceeds. Lessee shall reimburse Lessor upon completion of the repairs
for any  deductible  for which no  insurance  proceeds  will be  obtained  under
Lessor's  insurance policy to the extent such deductible is not reimbursed as an
Operating  Cost, or if other premises are also repaired,  a pro rata share based
on total costs of repair equitably  apportioned to the Leased  Premises.  Lessee
shall,  however,  not be  responsible  to pay any deductible or its share of any
deductible  to the  extent  that  Lessee's  payment  would be in  excess  of Ten
Thousand Dollars  ($10,000) if Lessee's consent has not been received by Lessor,
unless  such  denial of  consent  by Lessee is  unreasonable  in the  reasonable
judgment of Lessor's insurance consultant.

     23.4 Waiver.  Lessee  hereby  waives all  statutory or common law rights of
termination in respect to any partial  destruction or property loss which Lessor
is obligated  to repair or may elect to repair under the terms of this  Article.
Further,  in event of a property loss occurring during the last two (2) years of
the original  Term hereof or of any  extension,  Lessor need not  undertake  any
repairs and may cancel this Lease unless Lessee has the right under the terms of
this  Lease to extend  the Term for an  additional  period of at least  five (5)
years and does so within thirty (30) days of the date of the property loss.

     23.5 Lessor's Election.  In the event that the Complex or Building in which
the Leased Premises are situated be destroyed to the extent of not less than (i)
thirty-three and one-third  percent (33-1/3%) of the replacement cost thereof in
the event of an insured  property loss, or (ii) more than Five Hundred  Thousand
Dollars ($500,000) in replacement construction costs in the case of an Uninsured
Property  Loss,  Lessor may elect to  terminate  this Lease,  whether the Leased
Premises be injured or not, in the same manner as in Section 23.1 above.  At all
events,  a total  destruction of the Complex of which the Leased Premises form a
part, or the Leased Premises itself, shall terminate this Lease.

                                24. CONDEMNATION

     24.1 Definitions.

          (a) "Condemnation"  means (i) the exercise of any governmental  power,
whether by legal  proceedings  or otherwise,  by a Condemnor (as defined  below)
and/or (ii) a voluntary  sale or  transfer  by Lessor to any  Condemnor,  either
under threat of condemnation or while legal  proceedings  for  condemnation  are
pending.

          (b) "Date of  Taking"  means the date the  Condemnor  has the right to
possession of the property being condemned.

          (c) "Award" means all compensation, sums or anything of value awarded,
paid or received on a total or partial Condemnation.

          (d) "Condemnor" means any public or quasi-public authority, or private
corporation or individual, having the power of Condemnation.

     24.2  Total   Taking.   If  the  Leased   Premises  are  totally  taken  by
Condemnation, this Lease shall terminate on the Date of Taking.

     24.3 Partial Taking; Common Areas.

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<PAGE>
          (a) If any portion of the Leased  Premises  is taken by  Condemnation,
this Lease shall  remain in effect,  except  that Lessee can elect to  terminate
this Lease if thirty-three and one-third  percent (33-1/3%) or more of the total
number of square feet in the Leased Premises is taken.

          (b) If any  part of the  Common  Areas  of the  Complex  is  taken  by
Condemnation and as a consequence thereof, the Complex is not in compliance with
applicable  governmental  codes and  requirements,  then  Lessor  shall have the
election to terminate this Lease pursuant to this Section.

          (c) If fifty percent (50%) or more of the Building in which the Leased
Premises are located is taken,  Lessor shall have the election to terminate this
Lease in the manner prescribed herein.

     24.4  Termination  or Abatement.  If either party elects to terminate  this
Lease under the provisions of Section 24.3 (such party is  hereinafter  referred
to as the "Terminating  Party"), it must terminate by giving notice to the other
party (the "Nonterminating  Party") within thirty (30) days after the nature and
extent of the taking have been finally determined (the "Decision  Period").  The
Terminating  Party  shall  notify  the  Nonterminating  Party  of  the  date  of
termination,  which  date  shall not be  earlier  than sixty (60) days after the
Terminating  Party has  notified  the  Nonterminating  Party of its  election to
terminate  nor later than the Date of Taking.  If Notice of  Termination  is not
given within the  Decision  Period,  the Lease shall  continue in full force and
effect  except that  Minimum Rent shall be reduced by  subtracting  therefrom an
amount  calculated by multiplying the Minimum Rent in effect prior to the taking
by a fraction the numerator of which is the number of square feet taken from the
Leased Premises and the denominator of which is the number of square feet in the
Leased Premises prior to the taking.

     24.5  Restoration.  If there is a partial taking of the Leased Premises and
this Lease remains in full force and effect pursuant to this Article, Lessor, at
its cost, shall accomplish all necessary restoration so that the Leased Premises
is returned as near as practical to its condition  immediately prior to the date
of the taking, but in no event shall Lessor be obligated to expend more for such
restoration than the extent of funds actually paid to Lessor by the Condemnor.

     24.6 Award.  Any award  arising  from the  Condemnation  or the  settlement
thereof  shall belong to and be paid to Lessor  except that Lessee shall receive
from the award  compensation  for the following if specified in the award by the
Condemnor,  so long as it does not reduce  Lessor's award in respect of the real
property:  Lessee's trade fixtures, tangible personal property, loss of business
and relocation expenses.  At all events,  Lessor shall be solely entitled to all
award  in  respect  of the  real  property,  including  the  bonus  value of the
leasehold.  Lessee  shall not be entitled to any award until Lessor has received
the above sum in full.

                          25. ASSIGNMENT AND SUBLETTING

     25.1 Lease is Personal. The purpose of this Lease is to transfer possession
of the Leased Premises to Lessee for Lessee's personal use in return for certain
benefits,  including  rent, to be transferred  to the Lessor.  Lessee's right to
assign or sublet as stated in this Article is subsidiary  and  incidental to the
underlying  purpose of this Lease.  Lessee  acknowledges  and agrees that it has
entered  into this Lease in order to acquire  the  Leased  Premises  for its own
personal  use and not for the  purpose  of  obtaining  the right to  convey  the
leasehold to others.

     25.2 "Transfer of the Leased Premises" Defined.  The terms "Transfer of the
Leased  Premises" or "Transfer"  as used herein shall include any  assignment of
all or any  part of this  Lease  (including  assignment  by  operation  of law),
subletting of all or any part of the Leased  Premises or transfer of possession,
or granting of the right of possession or contingent  right of possession of all

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or any portion of the Leased Premises including,  without  limitation,  license,
concession,  mortgage,  devise,  hypothecation,  agency, franchise or management
agreement,  or  suffering  any other  person (the agents and  servants of Lessee
excepted) to occupy or use the Leased Premises or any portion thereof. If Lessee
is  a  corporation  which  is  not  deemed  a  public  corporation,   or  is  an
unincorporated  association or partnership,  or Lessee consists of more than one
party,  the transfer,  assignment or  hypothecation  of any stock or interest in
such  corporation,  association,  partnership  or  ownership  interest,  in  the
aggregate in excess of twenty-five  percent (25%), shall be deemed a Transfer of
the Leased Premises. Lessor acknowledges that Lessee is a public corporation and
is not subject to the preceding sentence.

     25.3 No Transfer Without Consent. Lessee shall not suffer a Transfer of the
Leased Premises or any interest  therein,  or any part thereof,  or any right or
privilege appurtenant thereto without the prior written consent of Lessor, and a
consent  to one  Transfer  of the  Leased  Premises  shall not be deemed to be a
consent to any subsequent  Transfer of the Leased Premises.  Any Transfer of the
Leased Premises  without such consent shall (i) be voidable,  and (ii) terminate
this Lease, in either case, at the option of Lessor.

     25.4 When Consent Granted.

          (a) The  consent  of  Lessor  to a  Transfer  may not be  unreasonably
withheld, provided that it is agreed to be reasonable for Lessor to consider any
of the following reasons, which list is not exclusive, in electing to consent or
to deny consent:

               (i) Financial strength of the proposed Transferee is not at least
equal to that of Lessee at the time of execution of this Lease;

               (ii)  A  proposed  Transferee  which  is in  good  standing  with
regulatory agencies.

               (iii) A proposed Transferee whose impact on the common facilities
or the other occupants of the Complex would be  disadvantageous to the operation
and  management of the Complex  including  increasing  the cost of operation and
management;

               (iv) A proposed Transferee whose use presents a risk of violation
of Article 12;

               (v)  A  proposed   Transferee  whose  occupancy  will  require  a
variation  in the terms of this  Lease  (for  example,  a  variation  in the use
clause);

               (vi) That there be no uncured  notices of default under the terms
of this Lease; or

               (vii) A proposed  Transferee  who is or is likely to be, or whose
business is or is likely to be, subject to compliance  with  additional  laws or
other  governmental  requirements  beyond  those to  which  Lessee  or  Lessee's
business is subject.

          (b)  Notwithstanding  the  foregoing,  Lessee  shall  have the  right,
without  the  consent of Lessor,  but upon prior  written  notice to Lessor,  to
assign this Lease to a company  incorporated  or to be  incorporated  by Lessee,
provided  that  Lessee  owns  or  beneficially   controls  all  the  issued  and
outstanding shares of capital stock of the company;  further provided,  however,
that in the event that at any time following such  assignment,  Lessee wishes to
sell, mortgage,  devise,  hypothecate or in any other manner whatsoever transfer
any portion of the ownership or beneficial control of the issued and outstanding
shares in the capital stock of such company, such transaction shall be deemed to
constitute  a Transfer  and shall be subject  to all of the  provisions  of this
Article 25 with  respect to a Transfer  of the  Leased  Premises  including,  by
specific reference, the provisions of Section 25.8.

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     25.5 Procedure for Obtaining Consent.

          (a) Lessor need not commence its review of any proposed  Transfer,  or
respond to any request by Lessee with  respect to such,  unless and until it has
received from Lessee adequate descriptive information concerning the Transferee,
the business to be  conducted  by the  Transferee,  the  Transferee's  financial
capacity,  and such other  information as may reasonably be required in order to
form a  prudent  judgment  as to the  acceptability  of the  proposed  Transfer,
including, without limitation, the following:

               (i)  Reasonable  financial  information  concerning  the proposed
Transferee  including  the past two years'  audited  annual  Balance  Sheets and
Profit and Loss statements certified correct by a Certified Public Accountant;

               (ii) Banking references of the proposed Transferee;

               (iii) A resume of the business  background  and experience of the
proposed Transferee;

               (iv) At  least  five (5)  business  references  for the  proposed
Transferee;

               (v) An executed copy of the  instrument by which Lessee  proposes
to effectuate the Transfer;

               (vi) A certified  statement,  including the  calculation,  of the
amount  of  unamortized  cost of  Lessee's  Tenant  Improvements  to the  Leased
Premises.

          (b) Lessee  shall  reimburse  Lessor as  additional  rent for Lessor's
reasonable costs and attorneys' fees incurred in conjunction with the processing
and  documentation of any proposed  Transfer of the Leased Premises,  whether or
not consent is granted.

     25.6 Recapture.

          (a) Except as provided in Section 25.6(c), by written notice to Lessee
(the "Termination Notice") within twenty (20) business days following submission
to Lessor by Lessee of the information  specified in Section 25.5,  Lessor:  (i)
may  terminate  this Lease in the event of an assignment of this Lease or sublet
of the entire Leased Premises;  or (ii) if such proposed  subletting will result
in more than fifty percent (50%) of the entire Leased  Premises being sublet (in
the aggregate  with any previous  subleases),  terminate this Lease as to all or
any  portion of the Leased  Premises.  Any  termination  pursuant to clause (ii)
above  shall be  subject  to the  rights of any  sublessees  under any  existing
subleases provided Lessor has previously consented to the sublease in accordance
with the terms of this Lease. In the event Lessor elects to terminate this Lease
as to that  portion of the Leased  Premises to be sublet,  an  amendment to this
Lease  shall be  executed  whereby  the  description  of the Leased  Premises is
restated  and  Lessee's  obligations  for rent and other  charges are reduced in
proportion  to the  reduction  in Rentable  Area of the Leased  Premises  caused
thereby.

          (b) In the event that Lessor  terminates this Lease or terminates this
Lease as to a portion thereof,  Lessor may, if it elects, enter into a new lease
covering the Leased Premises or a portion  thereof with the intended  Transferee
on such terms as Lessor and such  Transferee may agree or enter into a new lease
covering the Leased Premises with any other party;  in such event,  Lessee shall

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<PAGE>
not be entitled to any portion of the profit if any which  Lessor may realize on
account  of such  termination  and  reletting.  From and  after the date of such
termination of this Lease, the parties shall have no further obligations to each
other under this Lease except for matters occurring or obligations arising prior
to the date of such termination.

          (c)  Notwithstanding  the provisions of Section 25.6(a),  in the event
the  Transfer  is a part of the sale of Lessee's  entire  business by way of the
sale of substantially  all of the Lessee's assets or Lessee's capital stock, and
Lessor  approves  the  Transfer,   Lessor,  upon  reasonable  prior  notice  and
supporting  documentation,  agrees to waive its  recapture  rights  specified in
Section 25.6(a) and 25.6(b);  however,  all other provisions of Section 25 shall
be applicable to such a Transfer including the provisions of Section 25.8.

     25.7 Reasonable Restriction. The restrictions on Transfer described in this
Article  25 are  acknowledged  by  Lessee  to be  reasonable  for all  purposes,
including,  without  limitation,  the  provisions of California  Civil Code (the
"Code") Section 1951.4(b)(2).  Lessee expressly waives any rights which it might
otherwise be deemed to possess  pursuant to applicable law,  including,  without
limitation, Section 1997.040 of the Code, to limit any remedy of Lessor pursuant
to Section 1951.2 or 1951.4 of the Code by means of proof that  enforcement of a
restriction on use of the Leased Premises would be unreasonable.

     25.8 Effect of Transfer. If Lessor consents to a Transfer (or if a Transfer
occurs  without  Lessor's  consent in  accordance  with  Section  25.4(b)),  the
following conditions shall apply:

          (a) Each and every  covenant,  condition  or  obligation  imposed upon
Lessee by this Lease and each and every right, remedy or benefit afforded Lessor
by this Lease shall not be impaired or diminished as a result of such Transfer.

          (b) Lessee shall pay to Lessor,  on a monthly basis,  seventy  percent
(70%) of the  excess  of any sums of  money,  or  other  economic  consideration
received  by Lessee  from the  Transferee  in such month  (whether  or not for a
period longer than one month), including higher rent, bonuses, key money, or the
like over the aggregate, of: (i) the Amortized Portion, as defined below, of the
reasonable  expenses  actually  paid by Lessee to  unrelated  third  parties for
brokerage  commissions,  tenant  improvements to the Leased Premises,  or design
fees incurred as a direct  consequence of the Transfer;  and (ii) the total sums
which Lessee pays Lessor under this Lease in such month, or the prorated portion
thereof  if the  Leased  Premises  transferred  is less than the  entire  Leased
Premises.  The amount so derived shall be paid with Lessee's  payment of Minimum
Rent. The term  "Amortized  Portion" is that portion of the applicable  expenses
derived by dividing  such  expenses by the number of months in the original term
of the Transfer transaction.

          (c) No  Transfer,  whether  or  not  consent  of  Lessor  is  required
hereunder, shall relieve Lessee of its primary obligation to pay the rent and to
perform  all  other  obligations  to  be  performed  by  Lessee  hereunder.  The
acceptance of rent by Lessor from any proposed Transferee shall not be deemed to
be a waiver by Lessor of any  provision  of this Lease or to be a consent to any
Transfer of the Leased Premises.

          (d) If Lessor  consents to a sublease,  such sublease shall not extend
beyond the expiration of the Term.

          (e) No Transfer shall be valid and no Transferee shall take possession
of the Leased  Premises or any part thereof  unless,  within ten (10) days after
the  execution of the  documentary  evidence  thereof,  Lessee shall  deliver to
Lessor a duly  executed  duplicate  original of the Transfer  instrument in form
satisfactory to Lessor which provides that: (i) the Transferee  assumes Lessee's
obligations for the payment of rent and for the full and faithful observance and

                                       35
<PAGE>
performance of the covenants,  terms and conditions  contained herein; (ii) such
Transferee  will, at Lessor's  election,  attorn directly to Lessor in the event
Lessee's  Lease is  terminated  for any  reason  on the  terms  set forth in the
instrument  of transfer;  and (iii) such  instrument  of transfer  contains such
other assurances as Lessor reasonably deems necessary.

                                 26. ABANDONMENT

     26.1 Lessee to Occupy.  Lessee shall not abandon the Leased Premises at any
time during the Term,  and if Lessee  shall  abandon,  vacate or  surrender  the
Leased  Premises,  or be  dispossessed  by process  of law,  or  otherwise,  any
personal  property  belonging  to Lessee and  remaining  on the Leased  Premises
thereafter shall, at the option of Lessor, be deemed abandoned.

                               27. ENTRY BY LESSOR

     27.1 Rights of Lessor.  Lessee shall permit  Lessor and Lessor's  agents to
enter the Leased Premises at all reasonable  times,  and upon  reasonable  prior
notice  except in the case of an emergency,  for the purpose of  inspecting  the
same or for the purpose of maintaining  the Building and the Lines,  systems and
facilities  therein,  or  for  the  purpose  of  making  repairs,  replacements,
alterations  or additions to any portion of the Building and the Lines,  systems
and  facilities  therein,   including  the  erection  and  maintenance  of  such
scaffolding,  canopies,  fences and props as may be required, or for the purpose
of posting notices of non-responsibility for alterations,  additions or repairs,
or for the purpose of placing upon the Building any usual or ordinary "for sale"
signs,  without any rebate of Rent and without any  liability  to Lessee for any
loss of occupation or quiet enjoyment of the Leased Premises thereby occasioned,
and shall  permit  Lessor,  at any time  within  ninety  (90) days  prior to the
expiration  of this  Lease,  to place  upon the  Leased  Premises  any  usual or
ordinary  "to let" or "to  lease"  signs.  This  Section in no way  affects  the
maintenance obligations of the parties hereto.

                                    28. SIGNS

     28.1 Lessee shall not place on the Leased  Premises or on the Complex,  any
exterior signs or advertisements  nor any interior signs or advertisements  that
are visible  from the  exterior  of the Leased  Premises  including  the Atrium,
without  Lessor's  prior  written  consent,  which Lessor  reserves the right to
withhold for any aesthetic  reason in its sole judgment.  Lessee's name shall be
included on the  Building  directory  in the main lobby of the  Building  and in
applicable  Common Areas, in accordance with Lessor's Sign Program.  The cost of
installation and regular  maintenance of any such signs approved by Lessor shall
be at the sole  expense of Lessee.  At the  termination  of this  Lease,  or any
extension  thereof,  Lessee shall remove all its signs, and all damage caused by
such  removal  shall  be  repaired  at  Lessee's  expense.  Notwithstanding  the
foregoing,  Lessor  approves  Lessee's  installation  of those signs depicted in
Exhibit K, as well as one  flag/flagpole  sign above Lessee's  door,  subject to
Lessor's approval of size and design. Further,  subject to governmental approval
and Landlord's approval (which shall not be unreasonably withheld) as to design,
color,  and  placement,  Lessee may install an exterior sign  immediately  above
Tenant's  Townsend Street  entrance with the  approximate  dimensions of six (6)
feet wide by two (2) feet in height.

                                   29. DEFAULT

     29.1 Definition.  The occurrence of any of the following shall constitute a
material default and breach of this Lease by Lessee:

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<PAGE>
          (a) Any failure by Lessee to pay the rent or to make any other payment
required to be made by Lessee hereunder within three (3) days' of due date;

          (b) The  abandonment of the Leased  Premises by Lessee in violation of
Section 26.1 hereof;

          (c) Any failure by Lessee to provide  executed  documents  as and when
required under the provisions of Section 36.2 and/or Article 37;

          (d) A failure by Lessee to observe and perform any other  provision of
this Lease to be observed or performed by Lessee,  where such failure  continues
for thirty (30) days after written notice thereof by Lessor to Lessee; provided,
however,  that if the  nature  of the  default  is such  that  the  same  cannot
reasonably be cured within the thirty (30) day period allowed,  Lessee shall not
be deemed to be in default if Lessee shall,  within such thirty (30) day period,
commence to cure and thereafter diligently prosecute the same to completion;

          (e)  Either:  (i) the  appointment  of a  receiver  (except a receiver
appointed  at the  instance or request of Lessor) to take  possession  of all or
substantially all of the assets of Lessee;  (ii) a general  assignment by Lessee
for the benefit of  creditors;  or (iii) any action  taken or suffered by Lessee
under any insolvency or bankruptcy  act shall  constitute a breach of this Lease
by  Lessee.  In such  event,  Lessor  may,  at its  option,  declare  this Lease
terminated  and  forfeited by Lessee,  and Lessor shall be entitled to immediate
possession of the Leased Premises.  Upon such notice of termination,  this Lease
shall terminate immediately and automatically by its own limitation;

          (f) Any two (2) failures by Lessee to observe or perform any provision
of this Lease  during any twelve (12) month  period of the Term,  as such may be
extended,  shall constitute,  at the option of Lessor, a separate and noncurable
default.

                            30. REMEDIES UPON DEFAULT

     30.1 Termination and Damages.  In the event of any default by Lessee,  then
in addition to any other  remedies  available  to Lessor  herein or at law or in
equity,  Lessor shall have the immediate  option to terminate this Lease and all
rights of  Lessee  hereunder  by giving  written  notice  of such  intention  to
terminate. In the event that Lessor shall elect to so terminate this Lease, then
Lessor may recover from Lessee:

          (a) The Worth at the Time of Award,  as defined  below,  of any unpaid
rent which had been earned at the time of such termination; plus

          (b) 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 Lessee proves could have been  reasonably
avoided; plus

          (c) 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 Lessee proves could be reasonably avoided; plus

          (d) Any  other  amount  necessary  to  compensate  Lessor  for all the
detriment  proximately  caused by Lessee's  failure to perform  its  obligations
under this Lease or which in the  ordinary  course of events  would be likely to
result therefrom; and

                                       37
<PAGE>
          (e) At Lessor's election, such other amounts in addition to or in lieu
of the foregoing as may be permitted  from time to time by the applicable law in
the state in which the Leased Premises are located.

     30.2 Definition.  As used in subsections 30.1 (a) and (b) above, the "Worth
at the Time of  Award"  is  computed  by  allowing  interest  at the rate of ten
percent (10%) per annum. As used in subsection  30.1(c) above, the "Worth at the
Time of Award" is computed by  discounting  such amount at the discount  rate of
the Federal  Reserve  Bank for the region in which the Complex is located at the
time of award plus one percent (1%).

     30.3 Personal Property.

          (a) In the event of any default by Lessee,  Lessor shall also have the
right,  with or without  terminating  this Lease, to reenter the Leased Premises
and remove all persons and property from the Leased Premises;  such property may
be removed and stored in a public  warehouse or elsewhere at the cost of and for
the account of Lessee.

          (b) In the  event of  default  and  Tenant's  vacating  of the  Leased
Premises,  all  of  Lessee's  fixtures,  furniture,   equipment,   improvements,
additions,  Alterations  and other  personal  property  shall,  at the option of
Lessor, remain upon the Leased Premises and in that event, and continuing during
the length of such default,  Lessor shall have the sole right to take  exclusive
possession  of such  property  and to use it,  rent or  charge  free,  until all
defaults  are cured or, at  Lessor's  option,  at any time  during the Term,  to
require Lessee to forthwith remove such property.

     30.4 Recovery of Rent; Reletting.

          (a) In the event of the vacation or abandonment of the Leased Premises
by Lessee or in the event that  Lessor  shall  elect to reenter as  provided  in
Section 30.3 above, or shall take possession of the Leased Premises  pursuant to
legal  proceeding or pursuant to any notice provided by law, then if Lessor does
not elect to terminate this Lease as provided in Section 30.1 above,  this Lease
shall continue in effect for so long as Lessor does not terminate Lessee's right
to  possession,  and Lessor may enforce all its rights and  remedies  under this
Lease, including, without limitation, Lessor's right from, time to time, without
terminating  this Lease, to either recover all rental as it becomes due or relet
the  Leased  Premises  or any part  thereof  for such  term or terms and at such
rental or rentals and upon such other  terms and  conditions  as Lessor,  in its
sole  discretion,  may deem  advisable,  with the right to make  Alterations and
repairs to the Leased  Premises.  Acts of maintenance or preservation or efforts
to relet the Leased Premises or the appointment of a receiver upon initiation of
Lessor or other legal  proceeding  granting  Lessor or its agent  possession  to
protect Lessor's interest under this Lease shall not constitute a termination of
Lessee's right to possession.

          (b) In the event that  Lessor  shall elect to so relet,  then  rentals
received by Lessor from such reletting  shall be applied:  first, to the payment
of any indebtedness other than rent due hereunder from Lessee to Lessor; second,
to the payment of any cost of such reletting;  third, to the payment of the cost
of any alterations and repairs to the Leased Premises; fourth, to the payment of
rent due and unpaid hereunder;  and the residue, if any, shall be held by Lessor
and  applied in payment  of future  rent as the same may become due and  payable
hereunder.  Should that portion of such  rentals  received  from such  reletting
during any month,  which is applied by the  payment of rent  hereunder,  be less
than the rent payable during that month by Lessee  hereunder,  then Lessee shall
pay such deficiency to Lessor  immediately upon demand therefor by Lessor.  Such
deficiency  shall be  calculated  and paid  monthly.  Lessee  shall  also pay to
Lessor,  as soon as  ascertained,  any costs and expenses  incurred by Lessor in
such  reletting  or in making  such  alterations  and repairs not covered by the
rentals received from such reletting.

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<PAGE>
          (c) No reentry or taking  possession  of the  Leased  Premises  or any
other action  under this Section  shall be construed as an election to terminate
this  Lease  unless a  written  notice of such  intention  be given to Lessee or
unless the termination thereof be decreed by a court of competent  jurisdiction.
Notwithstanding  any  reletting  without  termination  by Lessor  because of any
default  by  Lessee,  Lessor  may at any  time  after  such  reletting  elect to
terminate this Lease for any such default.

          (d) Lessor has the remedy  described in California  Civil Code Section
1951.4  (Lessor  may  continue  Lease  in  effect  after  Lessee's   breach  and
abandonment and recover rent as it becomes due, if Lessee has right to sublet or
assign, subject only to reasonable limitations).

     30.5 No  Waiver.  Efforts  by  Lessor to  mitigate  the  damages  caused by
Lessee's  default in this Lease shall not  constitute a waiver of Lessor's right
to recover damages  hereunder,  nor shall Lessor have any obligation to mitigate
damages hereunder.

     30.6 Curing Defaults.  Should Lessee fall to repair,  maintain, keep clean,
and/or service the Leased Premises,  or any part or contents thereof at any time
or times, or perform any other  obligations  imposed by this Lease or otherwise,
then after having given Lessee  reasonable notice of the failure or failures and
a  reasonable  opportunity  which in no case shall exceed  thirty (30) days,  to
remedy the  failure,  Lessor may enter upon the Leased  Premises  and perform or
contract  for the  performance  of the  repair,  maintenance,  or  other  Lessee
obligation,  and Lessee  shall pay Lessor  for all  direct  and  indirect  costs
incurred in  connection  therewith  within  thirty (30) days of receiving a bill
therefor from Lessor.

     30.7 No Right to Cure.  Notwithstanding  anything to the contrary set forth
in Section  29.1  above,  Lessee  shall be deemed to have  committed  a material
default  and breach of this Lease,  without  any right on Lessee's  part to cure
such  default and breach,  upon the failure by Lessee to observe and perform the
provisions of any one or more of the following  Sections (or indicated  portions
thereof) of this Lease: 15.1 (first sentence), 25.3, 27.1, 36.2, 37.1, and 37.2.

     30.8 Cumulative Remedies. The various rights, options, election powers, and
remedies of Lessor  contained in this Article and  elsewhere in this Lease shall
be construed as cumulative  and no one of them exclusive of any others or of any
legal or equitable  remedy which  Lessor  might  otherwise  have in the event of
breach or default,  and the  exercise of one right or remedy by Lessor shall not
in any way impair its right to any other right or remedy.

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<PAGE>
                                 31. BANKRUPTCY

     31.1 Bankruptcy Events. If at any time during the Term there shall be filed
by or against  Lessee in any court  pursuant to any statute either of the United
States or of any state,  commonwealth,  district or territory thereof a petition
in bankruptcy or insolvency or for  reorganization  or for the  appointment of a
receiver or trustee of all or a portion of Lessee's  property or estate, or if a
receiver or trustee takes  possession of any of the assets of Lessee,  or if the
leasehold interest herein passes to a receiver, or if Lessee makes an assignment
for the benefit of creditors or petitions for or enters into an arrangement (any
of which are referred to herein as a  "Bankruptcy  Event"),  then the  following
provisions shall apply:

          (a) Upon the  occurrence  of a  Bankruptcy  Event,  or if Lessee takes
advantage  of any  insolvency  laws  of any  state,  district,  commonwealth  or
territory of the United States,  then in any such event Lessor at its option and
sole discretion may terminate this Lease at any time by written notice to Lessee
(subject, however, to applicable provisions of the applicable bankruptcy federal
or state  statutes  or any  insolvency  laws  during the  pendency of any action
thereunder  involving Lessee as the subject debtor). If this Lease is terminated
under this Article:  (i) Lessee agrees to  immediately  surrender and vacate the
Leased  Premises,  waives all statutory or other notice to quit, and agrees that
Lessor's  obligations  under this Lease shall cease from such termination  date;
and (ii) Lessor may recover  possession by process of law or in any other lawful
manner.  Furthermore,  if this Lease  terminates  under this Section (a), Lessor
shall,  subject to the  Bankruptcy  Code,  have all rights and remedies  against
Lessee as  provided  in this  Lease  and at law for a  default  of Lessee in the
payment of Minimum Rent, Percentage Rent, if any, and/or additional Rent. Lessee
hereby  acknowledges  that it shall have abandoned all of its personal  property
remaining in the Leased  Premises  after  Lessee  surrenders  possession  of the
Leased Premises, and Lessee hereby authorizes Lessor to dispose of such personal
property in any manner Lessor deems appropriate without accounting to governs or
shall govern the  proceedings  in which such damages are to be proved  limits or
shall limit the amount of such claim capable of so being  proved,  in which case
Lessor shall be entitled to prove as and for liquidated  damages an amount equal
to  that  allowed  by or  under  any  such  statute.  When  calculating  damages
hereunder,  Lessor shall be entitled to recover the amount of any "free rent" or
other  concessions  extended  by Lessor  and  received  by  Lessee  prior to the
premature  expiration  of this Lease,  it being agreed by Lessee that such "free
rent" and concessions were contingent upon Lessee fulfilling its obligations for
the entire term of this Lease. The provisions of this paragraph shall be without
prejudice  to (i)  Lessor's  right to prove in full  damages for  Minimum  Rent,
Percentage Rent, if any, and additional Rent accrued prior to the termination of
this Lease,  but not paid,  and (ii) any rights given to Lessor by any pertinent
statute to prove any amounts allowed  thereby.  In making any such  computation,
the then cash rental value of the Leased Premises shall be deemed prima facie to
be the rental realized upon any reletting, if such reletting can be accomplished
by Lessor within a reasonable time after such termination of this Lease, and the
then present cash value of the future rents hereunder reserved to Lessor for the
unexpired  portion of the Lease Term hereby  demised  shall be deemed to be such
sum, if invested at the then  current  passbook  account  rate  offered by Wells
Fargo Bank, N.A. at its main office in San Francisco, as will produce the future
rent over the period of time in question.  Lessor and Lessee  further agree that
in  making  any  computation  of  damages  for  Lessee  holding  over  after the
termination  of this Lease,  Lessor may claim damages based on the Minimum Rent,
Percentage  Rent, if any, and additional  Rent provided herein for the period of
such hold over, it being agreed that the Minimum Rent,  Percentage Rent, if any,
and additional  Rent  constitutes  the fair rental value of the Leased  Premises
during the hold over period.

               (i)  Notwithstanding  subsection  (h) of this Article 31,  Lessor
specifically  reserves  any and all  remedies  available to Lessor in Article 30
hereof or at law or in equity in  respect  of a  Bankruptcy  Event to the extent
such remedies are permitted by law.

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                             32. SURRENDER OF LEASE

     32.1 No Merger.  The voluntary or other  surrender of this Lease by Lessee,
or a mutual cancellation thereof,  shall not work as a merger, and shall, at the
option of Lessor,  terminate all or any existing  subleases or subtenancies,  or
may, at the option of Lessor,  operate as an assignment to it of any or all such
subleases or subtenancies.

                            33. LESSOR'S EXCULPATION

     33.1 Limited  Liability.  In the event of default,  breach, or violation by
Lessor  (which  term  includes  Lessor's  partners,  co-venturers,   co-tenants,
officers directors, trustees, employees, agents, representatives,  successors or
assigns) of any of Lessor's obligations under this Lease,  Lessor's liability to
Lessee shall be limited to its ownership interest in the Leased Premises (or its
interest in the Complex, if applicable) or the proceeds of a public sale of such
interest  pursuant to foreclosure of a judgment  against Lessor.  Lessor may, at
its option,  and among its other  alternatives,  relieve itself of all liability
under this Lease by conveying the Leased Premises to Lessee. Notwithstanding any
such conveyance, Lessee's leasehold and ownership interest shall not merge.

     33.2 No  Recourse.  Lessor  (as  defined  in  Section  33.1)  shall  not be
personally liable for any deficiency beyond its interest in the Leased Premises.
All  personal   liability  of  all   trustees,   their   employees,   agents  or
representatives, is expressly waived by Lessee.

                               34. ATTORNEYS' FEES

     34.1 Actions,  Proceedings, etc. Lessee hereby agrees to pay, as additional
rent,  all  attorneys'  fees and  disbursements,  and all other  court  costs or
expenses of legal  proceedings or other legal services which Lessor may incur or
pay out by reason of, or in connection with:

          (a) Any appearance by Lessor (or any officer,  partner, or employee of
Lessor)  as a  witness  or  otherwise  in any  action or  proceeding  whatsoever
involving  or  affecting  Lessee or this Lease  except as  otherwise  covered by
Section 34.3;

          (b) Any  assignment,  sublease,  or  leasehold  mortgage  proposed  or
granted  by  Lessee  (whether  or not  permitted  under  this  Lease),  and  all
negotiations with respect thereto; and

          (c)  Any  Alteration  of  the  Leased  Premises  by  Lessee,  and  all
negotiations with respect thereto.

     34.2 Survival.  Lessee's  obligations  under this Section shall survive the
expiration or any other  termination of this Lease.  This Section is intended to
supplement  (and not to limit)  other  provisions  of this Lease  pertaining  to
indemnities and/or attorneys' fees.

     34.3 Attorneys' Fees. If there is any legal action or proceeding (including
arbitration  other than the  Arbitration  of Fair  Market  Rental  described  in
Section 4.3) between  Lessor and Lessee  arising out of any default by Lessee or
Lessor in the observance or performance of any obligation under this Lease or to
enforce  this Lease or to protect or  establish  any right or remedy  under this
Lease,  the  unsuccessful  party to such action or  proceeding  shall pay to the
prevailing party all costs and expenses,  including  reasonable  attorneys' fees
and  disbursements,  incurred  by  such  prevailing  party  in  such  action  or
proceeding and in any appeal in connection  therewith.  If such prevailing party
recovers a judgment in any such action or proceeding (including  arbitration) or
appeal thereon, such costs, expenses and attorneys' fees and disbursements shall
be included in and as a part of such judgment.

                                       41
<PAGE>
                                   35. NOTICES

     35.1 Writing. All Notices (as defined below), demands and requests required
or permitted  to be given or made under any  provision of this Lease shall be in
writing and shall be given or made by (i) personal service, or (ii) by telephone
facsimile  upon which date and time are imprinted in the course of  transmission
to the number  indicated in Section 1.2, or (iii) by mailing same by  registered
or  certified  mail,  return  receipt  requested,  postage  prepaid,  or (iv) by
reputable courier which provides written evidence of delivery,  addressed to the
respective  party at the  address  set forth in Section  1.2 of this Lease or at
such other  address as the party may from time to time  designate,  by a written
Notice, as defined below, sent to the other in the manner aforesaid.

     35.2 Effective Date. Any such Notice, demand or request ("Notice") shall be
deemed given or made on the third day after the date so mailed.  Notwithstanding
the foregoing,  Notice given by personal delivery to the party at its address as
aforesaid  shall be deemed  given on the day on which  delivery is made.  Notice
given by a reputable courier service which provides written evidence of delivery
shall be deemed given on the business day immediately following deposit with the
courier service.

     35.3 Authorization to Receive. Each person and/or entity whose signature is
affixed  to this  Lease  as  Lessee  or as  guarantor  of  Lessee's  obligations
("Obligor") designates such other Obligor its agent for the purpose of receiving
any  Notice  pertaining  to this Lease or service of process in the event of any
litigation or dispute arising from any obligation imposed by this Lease.

                                36. SUBORDINATION

     36.1 Priority of Encumbrances.  This Lease shall be subject and subordinate
at all times to any and all ground  leases and the lien of any and all mortgages
and deeds of trust securing any amount or amounts whatsoever which may now exist
or  hereafter  be placed on or  against or  encumbering  the  Building  or on or
against or encumbering Lessor's interest or estate therein ("Superior Leases and
Mortgages"), all without the necessity of having further instruments executed by
Lessee to effect such subordination;  provided however; (i) with respect to that
certain deed of trust  encumbering the Building of record as of the date of this
Lease in favor of  Wells  Fargo  Bank  (the  "Bank"),  Lessor  covenants  to use
commercially reasonable efforts (without any requirement to pay any fees to said
lender or to initiate litigation) to cause the Bank to execute and deliver on or
before the Delivery Date a non-disturbance agreement in the form attached hereto
as Exhibit I, attached hereto, in favor of Lessee;  and (ii) with respect to any
Superior  Leases and Mortgages  encumbering  the Building after the date of this
Lease, Lessee shall execute a subordination  agreement in the form of Exhibit I,
provided that the  subordination  of this Lease shall be  conditioned  upon such
Lessor's mortgagee  executing a non-disturbance  agreement in favor of Lessee on
the current form used by such lender.  In the event of a foreclosure of any such
mortgage  or  deed  of  trust  or of any  other  action  or  proceeding  for the
enforcement  thereof, or of any sale thereunder or in the event of a termination
of any such ground lease,  this Lease shall not be  terminated or  extinguished,
nor shall the rights and  possession  of Lessee  hereunder be  disturbed,  if no
default then exists under this Lease,  and Lessee shall attorn to the person who
acquires Lessor's interest hereunder through any such mortgage or deed of trust.

     36.2  Execution of  Documents.  Lessee  agrees to execute any  commercially
reasonable  documents  required to effectuate such subordination or to make this
Lease prior to the lien of any mortgage,  deed of trust or ground lease,  as the
case may be, and failing to do so within ten (10)  business  days after  written

                                       42
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demand, does hereby make,  constitute and irrevocably appoint Lessor as Lessee's
attorney-in-fact  and in  Lessee's  name,  place  and  stead,  to do  so.  It is
understood  by all parties that  Lessee's  failure to execute the  subordination
documents referred to above may cause Lessor serious financial damage by causing
the failure of a financing or sale transaction.

     36.3  Attornment.  Lessee shall attorn to any purchaser at any  foreclosure
sale,  or to any grantee or  Transferee  designated in any Deed given in lieu of
foreclosure.

                            37. ESTOPPEL CERTIFICATES

     37.1 Execution by Lessee. Within ten (10) business days of request therefor
by Lessor,  Lessee shall execute a written  statement  ("Estoppel  Certificate")
acknowledging  the commencement and termination  dates of this Lease, that it is
in full force and effect,  has not been  modified  (or if it has,  stating  such
modifications)  and providing any other  pertinent  information as Lessor or its
agents might reasonably request.  Failure to comply with this Article shall be a
material  breach of this Lease by Lessee  giving  Lessor all rights and remedies
under Article 30 hereof,  as well as a right to damages  caused by the loss of a
loan or sale  which  may  result  from such  failure  by  Lessee.  A copy of the
Estoppel  Certificate required by Lessor's lender and required to be executed by
Lessee is attached hereto as Exhibit L.

     37.2 Financing, Sale or Transfer. If Lessor desires to finance,  refinance,
sell,  ground  lease or  otherwise  transfer  the Leased  Premises,  or any part
thereof, or the Building, Lessee hereby agrees, within ten (10) business days of
request  therefor  by Lessor,  to  deliver  to any lender or to any  prospective
buyer,  ground lessor or other  Transferee  designated by Lessor such  financial
statements of Lessee,  its Guarantor and its parent  company,  if any, as may be
reasonably  required by such party. Such statements shall include the past three
(3) years' financial  statements of Lessee. All such financial  statements shall
be  received  by Lessor in  confidence  and shall be used only for the  purposes
herein set forth.

                                   38. WAIVER

     38.1  Effect of  Waiver.  The  waiver by Lessor of any  breach of any Lease
provision  shall not be deemed to be a waiver  of such  Lease  provision  or any
subsequent  breach of the same or any other term,  covenant or condition therein
contained.  The  subsequent  acceptance of rent hereunder by Lessor shall not be
deemed to be a waiver of any preceding breach by Lessee of any provision of this
Lease,  other  than the  failure  of  Lessee  to pay the  particular  rental  so
accepted,  regardless of Lessor's knowledge of such preceding breach at the time
of acceptance of such rent.

                                39. HOLDING OVER

     39.1  Month-to-Month  Tenancy on  Acceptance.  If Lessee  should  remain in
possession of the Leased  Premises  after the expiration of the Term and without
executing a new Lease,  then,  upon  acceptance of rent by Lessor,  such holding
over shall be  construed as a tenancy  from  month-to-month,  subject to all the
conditions,  provisions and obligations of this Lease as existed during the last
month of the Term hereof,  so far as  applicable  to a  month-to-month  tenancy,
except that the Minimum Rent shall be equal to one hundred fifty percent  (150%)
of the  Minimum  Rent  payable  immediately  prior to the  expiration  or sooner
termination of the Lease.

                                       43
<PAGE>
                           40. SUCCESSORS AND ASSIGNS

     40.1 Binding Effect.  The covenants and conditions  herein contained shall,
subject  to the  provisions  as to  assignment,  apply to and  bind  the  heirs,
successors, executors,  administrators and assigns of all of the parties hereto;
and all of the parties hereto shall be jointly and severally liable hereunder.

                                    41. TIME

     41.1 Time of the Essence. Time is of the essence of this Lease with respect
to each and every article, section and subsection hereof.

                        42. EFFECT OF LESSOR'S CONVEYANCE

     42.1 Release of Lessor. If, during the Term, Lessor shall sell its interest
in the  Building  or Complex of which the Leased  Premises  form a part,  or the
Leased  Premises,  then  from  and  after  the  effective  date  of the  sale or
conveyance, Lessor shall be released and discharged from any and all obligations
and responsibilities under this Lease, except those already accrued.

                                43. COMMON AREAS

     43.1 Lessor shall, in Lessor's sole  discretion,  maintain the Common Areas
(subject to reimbursement  pursuant to Article 8 hereof),  establish and enforce
reasonable rules and regulations  concerning such areas, close any of the Common
Areas to whatever extent required in the opinion of Lessor's  counsel to prevent
a  dedication  of any of the  Common  Areas or the  accrual of any rights of any
person or of the public to the Common Areas, close temporarily any of the Common
Areas for maintenance  purposes and make changes to the Common Areas  including,
without limitation, changes in the location of driveways,  corridors, entrances,
exits,  vehicular parking spaces, parking area, the designation of areas for the
exclusive use of others, the direction of the flow of traffic or construction of
additional buildings thereupon. Lessor may provide security for the Common Areas
but is not obligated to do so.

                            44. TRANSFER OF SECURITY

     44.1  Transfer to  Purchaser.  If any security be given by Lessee to secure
the  faithful  performance  of all or any of the  covenants of this Lease on the
part of Lessee, Lessor may transfer and/or deliver the security, as such, to the
purchaser  of the  reversion,  in the  event  that the  reversion  be sold,  and
thereupon  Lessor shall be  discharged  from any further  liability in reference
thereto.

                                45. LATE CHARGES

     45.1 Late  Payment  by Lessee.  Lessee  acknowledges  that late  payment by
Lessee to Lessor of rent or any other payment due hereunder will cause Lessor to
incur costs not contemplated by this Lease, the exact amount of such costs being
extremely  difficult  and  impractical  to  fix.  Such  costs  include,  without
limitation,  processing  and  accounting  charges,  and late charges that may be
imposed  on Lessor  by the  terms of any  encumbrance  and note  secured  by any
encumbrance covering the Leased Premises. Therefore, if any installment of rent,
or any other payment due hereunder  from Lessee is not received by Lessor within
five (5) days of due date,  Lessee shall pay to Lessor an additional sum of five
percent (5%) of such rent or other charge as a late  charge.  The parties  agree
that this late charge represents a fair and reasonable estimate of the cost that
Lessor will incur by reason of late  payment by Lessee.  Acceptance  of any late
charge  shall not  constitute  a waiver of Lessee  default  with  respect to the
overdue  amount,  or prevent Lessor from exercising any other rights or remedies
available. to Lessor.

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<PAGE>
                             46. CORPORATE AUTHORITY

     46.1  Authorization  to Execute.  Lessee  represents and warrants that each
individual  executing this Lease is duly  authorized to execute and deliver this
Lease on behalf of said corporation in accordance with a duly adopted resolution
of the Board of Directors of said  corporation or in accordance  with the Bylaws
of said  corporation,  and that this Lease is binding upon said  corporation  in
accordance with its terms. Further,  Lessee shall, within thirty (30) days after
execution of this Lease,  deliver to Lessor a certified  copy of a resolution of
the  Board  of  Directors  of said  corporation  authorizing  or  ratifying  the
execution of this Lease.

                            47. MORTGAGEE PROTECTION

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

                          48. MISCELLANEOUS PROVISIONS

     48.1 Captions.  The captions of this Lease are for convenience only and are
not a part of this  Lease and do not in any way limit or  amplify  the terms and
provisions of this Lease.

     48.2 Number and Gender.  Whenever the singular number is used in this Lease
and when required by the context,  the same shall include the plural, the plural
shall include the singular,  and the masculine gender shall include the feminine
and neuter  genders,  and the word "person" shall include  corporation,  firm or
association.  If there be more than one Lessee,  the  obligations  imposed under
this Lease upon Lessee shall be joint and several.

     48.3  Modifications.  This  instrument  contains  all  of  the  agreements,
conditions  and  representations  made between the parties to this Lease and may
not be modified  orally or in any other  manner than by an  agreement in writing
signed by all of the parties to this Lease.

     48.4 Payments.  Except as otherwise expressly stated, each payment required
to be made by Lessee shall be in addition to and not in  substitution  for other
payments to be made by Lessee.

     48.5  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.

     48.6 No Offer.  The  preparation and submission of a draft of this Lease by
either party to the other shall not constitute an offer,  nor shall either party
be bound to any terms of this Lease or the  entirety of the Lease  itself  until
both parties  have fully  executed a final  document  and an original  signature
document has been received by both parties.  Until such time as described in the
previous  sentence,  either  party  is free to  terminate  negotiations  with no
obligation to the other.

                                       45
<PAGE>
     48.7 Disputed Sums.  Under the terms of this Lease numerous charges are and
may be due from Lessee to Lessor including, without limitation, Operating Costs,
Real Estate Taxes and other items of a similar nature including advances made by
Lessor in respect of Lessee's default at Lessor's  option.  In the event that at
any time during the Term there is a bona fide dispute  between the parties as to
the amount due for any of such  charges  claimed by Lessor to be due, the amount
demanded by Lessor shall be paid by Lessee until the  resolution  of the dispute
between the parties or by litigation. Failure by Lessee to pay the disputed sums
until resolution shall constitute a default under the terms of the Lease.

     48.8 Lessee's Remedies.  Notwithstanding anything to the contrary contained
in this Lease, if any provision of this Lease  expressly or impliedly  obligates
Lessor not to  unreasonably  withhold  its  consent or  approval,  an action for
declaratory  judgment or specific  performance  will be Lessee's  sole right and
remedy in any dispute as to whether Lessor has breached such obligation.

     48.9  Light,  Air and View.  No  diminution  of light,  air, or view by any
structure  which may  hereafter  be erected  (whether  or not by  Lessor)  shall
entitle  Lessee to any  reduction of Rent,  result in any liability of Lessor to
Lessee, or in any other way affect this Lease or Lessee's obligations hereunder.

     48.10  Public  Transportation  Information.   Lessee  shall  establish  and
maintain  during the Term  hereof a program to  encourage  maximum use of public
transportation   by  personnel  of  Lessee  employed  on  the  Leased  Premises,
including,  without  limitation,  the  distribution to such employees of written
materials  explaining the convenience and availability of public  transportation
facilities  adjacent or proximate to the Complex,  staggering  working  hours of
employees,  and  encouraging  use  of  such  facilities,  all at  Lessee's  sole
reasonable  cost and expense.  Lessee shall comply with all  requirements of any
local transportation management ordinance.

     48.11 Rules and  Regulations.  Lessee agrees to comply with all  reasonable
rules and  regulations  adopted and  promulgated by Lessor and applicable to all
tenants in the Complex for the lawful, orderly,  clean, safe, aesthetic,  quiet,
and beneficial use,  operation,  maintenance,  management,  and enjoyment of the
Complex. Lessor shall have no liability for violation by any other lessee in the
Complex of any rules or regulations,  nor shall such violation or waiver thereof
excuse Lessee from compliance.  The initial rules and regulations concerning the
Complex  are  attached  hereto as Exhibit F. Lessor  reserves  the right to make
additional rules affecting the Complex  throughout the Term hereof. All delivery
and dispatch of supplies,  fixtures,  equipment and furniture  shall be by means
and during hours  established  by Lessor.  Lessee shall not at any time park its
trucks or other  delivery  vehicles  in the Common  Areas,  except in such parts
thereof as from time to time designated by Lessor.

     48.12 Joint and Several  Liability.  Should Lessee consist of more than one
person or entity, they shall be jointly and severally liable on this Lease.

     48.13 Survival of  Obligations.  All obligations of Lessee which may accrue
or arise during the Term or as a result of any act or omission of Lessee  during
said Term shall, to the extent they have not been fully performed,  satisfied or
discharged, survive the expiration or termination of this Lease.

     48.14 Real Estate  Brokers.  Lessor and Lessee each represents and warrants
to the  other  party  that  it has not  authorized  or  employed,  or  acted  by
implication  to authorize or employ,  any real estate  broker or salesman to act
for it in  connection  with  this  Lease  other  than  the real  estate  brokers
specified in Section 1.10.  Lessor shall pay the commission due Lessor's  broker

                                       46
<PAGE>
and Lessee's broker pursuant to a separate agreement between Lessor and Lessor's
broker. Lessor and Lessee shall each indemnify,  defend and hold the other party
harmless  from and  against  any and all  claims  by any real  estate  broker or
salesman  whom  the  indemnifying  party  authorized  or  employed,  or acted by
implication  to  authorize  or  employ,  to act for the  indemnifying  party  in
connection with this Lease.

     48.15  Nonliability  of Lessor for  Approvals.  Except as may  otherwise be
expressly stated by a provision of this Lease, and only to the extent so stated,
the consent or approval,  whether express or implied, or the act, failure to act
or failure  to object,  by Lessor in  connection  with any plan,  specification,
drawing, proposal, request, act, omission, notice or communication (collectively
"Act")  by or  for,  or  prepared  by or  for,  Lessee,  shall  not  create  any
responsibility  or liability on the part of Lessor,  and shall not  constitute a
representation  by  Lessor,  with  respect  to  the  completeness,  sufficiency,
efficacy, propriety, quality or legality of such Act.

     48.16  Interest On Past Due  Amounts.  If any sum due Lessor from Lessee is
not received by Lessor  within five (5) calendar days after the date such sum is
due and payable,  such sum shall bear  interest  from the due date until paid by
Lessee at the rate of two percent (2%) above the Prime Rate (as herein defined),
not to exceed the maximum rate of interest allowed by law in the state where the
Leased Premises are located,  and such interest shall be deemed to be additional
rent. "Prime Rate" means the Prime Rate of interest as quoted in the Wall Street
journal on the date such sum was due and payable.

     48.17 Counterparts. This Lease may be executed in one or more counterparts,
each of which  shall  be  deemed  an  original,  and all  taken  together  shall
constitute one and the same instrument.

                     49. WAIVER OF CALIFORNIA CODE SECTIONS

     49.1  Waiver  by  Lessee.  In this  Lease,  numerous  provisions  have been
negotiated  by the  parties,  some of which  provisions  are covered by statute.
Whenever a provision  of this Lease and a provision  of any statute or other law
cover the same matter,  the provisions of this Lease shall  control.  Therefore,
Lessee waives (for itself and all persons  claiming under Lessee) the provisions
of Civil Code Sections  1932(2) and 1933(4) with respect to the  destruction  of
the Leased Premises;  Civil Code Sections 1941 and 1942 with respect to Lessor's
repair  duties and  Lessee's  right to  repair;  Civil  Code  Section  1995.310,
granting  to a tenant  all  remedies  provided  by law for  breach  of  contract
(including,  without limitation,  the right to contract damages and the right to
terminate the lease) in the event that the Lessor unreasonably withholds consent
to a transfer in violation of the Lessee's rights under tKe lease; Code of Civil
Procedure Section 1265.130, allowing either party to petition the Superior Court
to terminate this Lease in the event of a partial taking of the Leased  Premises
by Condemnation as herein defined;  and any right of redemption or reinstatement
of Lessee under any present or future case law or statutory provision (including
Code of Civil  Procedure  Sections 473 and 1179 and Civil Code Section  3275) in
the event Lessee is dispossessed  from the Leased Premises for any reason.  This
waiver applies to future statutes  enacted in addition to or in substitution for
the statutes specified herein.

                               50. SHUTTLE SERVICE

     50.1 Lessor  presently  maintains for the benefit of Lessee's  employees at
the Leased  Premises,  a van shuttle  service which shall operate Monday through
Friday from 7:00 a.m. to 7:00 p.m. with not less than one van vehicle  operating
throughout the day and two vehicles  operating during peak commute hours of 7:00
a.m.  to 9:00 a.m.  Monday  through  Friday  and 5:00 p.m.  to 7:00 p.m.  Monday
through Friday. The shuttle will serve the major  transportation  centers of San
Francisco,  i.e., the Transbay  Terminal,  BART, the nearest  Municipal  Railway
stop, the Ferry Building and CalTrain Terminal. Lessor may terminate the shuttle
service if the City of San Francisco is, in Lessor's reasonable  judgment,  then

                                       47
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providing  adequate  public  transportation  to the area of the  Building and no
longer requires that Lessor provide such shuttle  service.  At Lessee's  option,
Lessee's employees may use the shuttle service subject to a reasonable fee to be
mutually agreed upon between Lessor and Lessee.

     50.2  Parking.  Lessee  may  lease on a monthly  basis up to the  number of
parking spaces described in Section 1.12 in the parking facility of the Complex.
Said parking  spaces shall be on a  non-exclusive,  non-reserved  basis.  Lessee
shall pay a parking fee for each parking  space which Lessee  leases at the same
monthly  rates as are  established  from  time to time by Lessor or the owner or
operator of the parking  facility.  The use by Lessee,  its  employees  or other
users of such  parking  space  shall be  subject  to the rules  and  regulations
established from time to time by Lessor, or the owner or operator of the parking
facility.  If Lessee has not leased the number of parking  spaces to which it is
entitled within three (3) months after the Commencement  Date, or if at any time
thereafter,  Lessee  releases any parking  spaces or if parking  spaces to which
Lessee is entitled under this Section 50.2 exceeds the parking  spaces  actually
leased by Lessee,  Lessee  shall have no further  right or  entitlement  to such
parking  spaces and Lessor may permit others to use or lease such parking spaces
on a long or short term basis. If Lessor or the owner or operator of the parking
facility changes the parking arrangements in the parking facility, then Lessee's
rights under this Section 50.2 shall be subject to  modification to reflect such
change, so long as Lessee is not  disproportionately  prejudiced by such changes
as compared to other lessees of the Building.

     50.3  Retail  Parking.  Lessee's  customers  would be  guided  to  Lessor's
designated  temporary  parking on the roof of the Building.  Lessee may purchase
for the use of its customers a validation  stamp from the garage vendor.  Lessor
would work with Lessee to obtain  "green zone"  parking in front of the Townsend
Street retail area.

     IN WITNESS  WHEREOF,  Lessor and Lessee have  executed this Lease as of the
day and year first written above.

LESSOR:                                      LESSEE:
ZORO LLC                                     METRO COMMERCE BANK,
a California limited liability company       a California corporation

/s/ Martin Zankel                            /s/ Raymon L Hanssen
----------------------------------           ----------------------------------
Its Managing Member                          Its Executive Vice President

                                       48
<PAGE>
                                    EXHIBIT A

                                LEGAL DESCRIPTION

The land  referred to herein is situated in the State of  California,  County of
San Francisco, City of San Francisco, and is described as follows:

PARCEL ONE:

ALL OF LOT 9,  Assessor's  Block 3783,  as shown on that  certain Map  entitled,
"Parcel  Map of a portion  of 100 Vara  Block No.  412,  also being a portion of
Assessor's  Block No.  3783  which Map was filed for record in the Office of the
Recorder  of the City and  County  of San  Francisco,  State of  California,  on
November 29, 1988 in Book 38 of Parcel Maps, at Page 36.

PARCEL TWO:

Non-exclusive  easements  as set forth in that  certain  Grant of Easement  with
Covenants and  Restrictions  affecting land dated as of December 29, 1988 by and
between Bay West Showplace  Investors,  a California  Limited  Partnership,  and
Portman/Bay  West  Apparel  Partners,  a  California  Partnership,  recorded  on
December 30, 1988 in Book E775 at Page 1598,  Series No. E296406 in the Official
Records.

APN: Lot 009, Block 3783

COMMON KNOWN AS:
                               650 Townsend Street
                                SAN FRANCISCO, CA

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