
<PAGE>

                                                                 Exhibit 10.137


                     WESTMINSTER GATEWAY SHOPPING CENTER
                                GROUND LEASE

                             TABLE OF CONTENTS
<TABLE>
<CAPTION>

Article    Title                                                            Page
-------    -----                                                            ----
<S>        <C>                                                               <C>
           SUMMARY.........................................................  i
 1         PREMISES, COMMON AREAS, PARKING.................................  1
 2         TERM............................................................  2
 3         FIXED RENT......................................................  3
 4         ADDITIONAL RENT.................................................  4
 5         INTENTIONALLY OMITTED...........................................  7
 6         SECURITY DEPOSIT................................................  7
 7         UTILITIES AND SECURITY SERVICES.................................  7
 8         USE OF PREMISES, COMPLIANCE WITH LAW............................  8
 9         ACCEPTANCE OF PREMISES..........................................  9
10         ALTERATIONS..................................................... 10
11         LIENS AND ENCUMBRANCES.......................................... 11
12         TAXES ON THE PREMISES AND TENANTS PROPERTY...................... 12
13         MAINTENANCE AND REPAIR.......................................... 13
14         ENTRY AND INSPECTION............................................ 14
15         WAIVER AND INDEMNIFICATION...................................... 14
16         INSURANCE....................................................... 15
17         ASSIGNMENT AND SUBLETTING....................................... 17
18         TRANSFER OF LANDLORD'S INTEREST................................. 18
19         DAMAGE OR DESTRUCTION........................................... 19
20         EMINENT DOMAIN.................................................. 20
21         SIGNS AND AUCTIONS.............................................. 20
22         DEFAULTS AND REMEDIES........................................... 21
23         SURRENDER OF PREMISES; REMOVAL OF PROPERTY...................... 23
24         ATTORNEYS' FEES................................................. 24
25         WAIVER.......................................................... 24
26         HOLDING OVER.................................................... 25
27         SUBORDINATION AND ATTORNMENT.................................... 25
28         DEFINITIONS..................................................... 25
29         HEIRS AND ASSIGNS/TIME OF ESSENCE............................... 26
30         INTERPRETATION.................................................. 26
31         RIGHT OF LANDLORD TO PERFORM.................................... 27
32         NOTICES......................................................... 27
33         QUIET ENJOYMENT................................................. 27
34         ESTOPPEL CERTIFICATE............................................ 27
35         AUTHORITY....................................................... 27
36         BROKERS......................................................... 28
37         ACCORD AND SATISFACTION......................................... 28
38         LANDLORD RESERVATIONS........................................... 28
39         LENDER'S APPROVAL............................................... 28
40         HAZARDOUS OR INFECTIOUS SUBSTANCES.............................. 29
41         UTILITY RATIONING............................................... 31
42         TITLE........................................................... 32
43         MEMORANDUM OF LEASE............................................. 32

</TABLE>

<TABLE>
<CAPTION>

                              SCHEDULE OF EXHIBITS
              <S>               <C> 
               Exhibit "A"       Site Plan of Shopping Center
               Exhibit "A-1"     Tract Map
               Exhibit "A-2"     Site Plan (With "Common Areas" identified)
               Exhibit "A-3"     Exterior Design Plan
               Exhibit "B"       Rules and Regulations
               Exhibit "C"       Construction Exhibit
               Exhibit "D"       Plot Plan of Premises (with "Pad" identified; 
                                 MCG Architects version 01/28/98)
               Exhibit "D-1"     Site Plan (with construction areas, material
                                 storage areas, and construction vehicle access
                                 routes identified.)
               Exhibit "E"       Intentionally Omitted
               Exhibit "F"       Supplemental Agreement
               Exhibit "G"       Intentionally Omitted
               Exhibit "H"       Form Amendment to Declaration
</TABLE>

<PAGE>

                            WESTMINSTER GATEWAY
                                GROUND LEASE

         THIS GROUND LEASE ("Lease"), dated for reference purposes only as of
the 5th day of March, 1998 (the "Execution Date"), is made by and between FF
PROPERTIES, L.P. a California limited partnership ("Landlord"), and EAGLE
HARDWARE & GARDEN, INC., a Washington corporation ("Tenant").

                                 LEASE SUMMARY

         The following summary (the "Lease Summary") sets forth the 
definitions and meanings of the following terms for all purposes of this 
Lease, unless otherwise specifically provided or modified herein.

1. Intentionally Omitted.

2. Shopping Center: That certain complex of retail stores commonly known as the
"Westminster Gateway" located at 7901 Trask Avenue, in the City of Westminster,
California, together with the Tenant "Building(s)" and all "Common Areas" (as
that term is hereinafter defined) and the land underlying the Buildings and
Common Areas (collectively, the "Shopping Center"). The Shopping Center is
comprised of Lots 1 through 7, inclusive, as more particularly set forth on that
certain Tract Map No. 15514 recorded on December 17, 1997 as Instrument No.
97-0651234 in Book 760, Pages 24-29, inclusive, of maps in the Office of the
County Recorder of Orange County, California (the "Map"), a copy of which is
attached as Exhibit "A-1". Exhibit "A", which depicts the general layout of the
Shopping Center, shall not be deemed a warranty, representation or agreement on
the part of Landlord that the Shopping Center will be (or has been) constructed
exactly as indicated on said site plan, or that it will continue in the future
to be exactly as indicated thereon.

3. Premises: That certain real property within the Shopping Center as depicted
on Exhibit "D" attached hereto and referred to as Lots 2, 3, 4 & 5 on Exhibit
"A-1", containing approximately five hundred thousand (500,000) square feet (the
"Premises"), upon which a building will be constructed containing approximately
one hundred thirteen thousand one hundred square feet (113,100) square feet with
a garden yard containing approximately twenty-four thousand four hundred and
fifty (24,450) square feet (collectively, the "Building"). The land on which the
Building is situated is referred to as the "Pad" and is shown on Exhibit "D,"
and consists of approximately one hundred thirty-seven thousand five hundred and
fifty (137,550) square feet. The Exhibit "D" Plot plan is the one Tenant will
submit for its "Governmental Approvals" under Paragraph 9.3.

4. Fixed Rent: Seven Hundred Fifty Thousand Dollars ($750,000) per year, subject
to periodic increases as provided in Article 3.

5. Intentionally Omitted.

6. Term: Twenty-five (25) years, with one ten-year option, followed by two
five-year options, as provided in Article 2.

7. Commencement Date: See Article 2.

8. Security Deposit: See Article 6.

9. Tenant's Proportionate Share of Common Areas Operating Costs: Eighty-eight
and 14/100 percent (88.14%), as adjusted from time to time as provided in
Paragraph 4.2. (Art. 4)

10. Use of Premises: For the retail sale of home improvement and gardening
products and other items customarily carried in Eagle Hardware and Garden stores
from time to time and for no other use or purpose, including without limitation
the prohibited uses set forth in the "Declaration" (defined in Paragraph 1.6).
(Art. 8)

11. Addresses:

   (a) Landlord For Notices:
       FF Properties, L.P.
       Attn: Real Estate Department
       120 N. Robertson Boulevard, Third Floor
       Los Angeles, California 90048
       Attention: Property Management
       Fax:       (310) 652-8538
       Telephone: (310) 855-8453

(b) Landlord for Payments:

       FF Properties, L.P.
       120 N. Robertson Boulevard, Third Floor
       Los Angeles, California 90048
       Attention: Real Estate Accounting
<PAGE>
       
   (c) Tenant For Notices:
       
       Eagle Hardware & Garden
       981 Powell Avenue S.W.
       Renton, Washington 98055
       Attention: Richard T. Takata
       Fax: (452) 204-5169
       
(Art. 32)

12. Broker(s): Pacific Retail Partners, on behalf of Landlord, and Majestic 
Realty, on behalf of Tenant. (Art. 36)
<PAGE>

                              WESTMINSTER GATEWAY

                                  GROUND LEASE

         In addition to each of the provisions contained in the Lease Summary,
all of the provisions, covenants and conditions set forth in the succeeding
Articles, Addenda, if any, and Exhibits attached hereto are incorporated in this
Lease and by this reference made a part hereof. Landlord and Tenant hereby agree
that this Lease shall be deemed binding and in full force and effect upon the
Execution Date, and further covenant and agree as follows:

                                  ARTICLE 1
                       PREMISES, COMMON AREAS, PARKING

         1.1 Premises. In consideration of and subject to each and all of the
covenants, terms and conditions herein set forth, Landlord hereby leases to
Tenant and Tenant hereby hires from Landlord the Premises located in the
Shopping Center.

         1.2 Common Areas. Tenant and its employees, customers and invitees
shall have the non-exclusive license to use that portion of the Shopping Center
designated by Landlord for the common use of tenants of the Shopping Center and
any other persons permitted by Landlord to use same (the "Common Areas"), which
Common Areas include a portion of the Premises. The Common Areas, including the
Common Areas on the Premises, are designated on Exhibit "A-2" and shall be
subject to the terms and conditions of the Declaration and reasonable
non-discriminatory rules and regulations governing use as promulgated from time
to time by Landlord and uniformly applied (the "Rules and Regulations"),
including the designation of specific areas within the Shopping Center for
specific purposes or common uses. A copy of the current Rules and Regulations
are attached hereto as Exhibit "B."

         1.3 Parking. During the term hereof, Landlord hereby grants Tenant and
its employees, customers, and invitees, subject to availability, the
non-exclusive license to use that portion of the Common Areas designated on
Exhibit "A-2" by Landlord for parking, subject to the Declaration and the Rules
and Regulations (which may include the designation of specific areas in which
vehicles owned by Tenant, its employees, subtenants and invitees shall be
parked). Tenant agrees to furnish to Landlord a complete list of its motor
vehicles and license numbers and the names of Tenant's employees at the Premises
who have automobiles and of their respective license numbers.

         1.4 Ground Lease. The interest of Landlord in the Shopping Center is 
that of a ground lessee pursuant to that certain lease dated as of July 1, 
1994 by and between California Drive-In Theaters, Inc. as ground lessor 
("Master Landlord") and Landlord, as ground lessee, as amended by that 
certain First Addendum to Lease dated October 1, 1995 between Master Landlord 
and Landlord (the "Master Lease"), a memorandum of which has been recorded. 
Under the Master Lease, Landlord ground leases Lots 1 through 7, inclusive, 
of the Map (each may be sometimes referred to singularly in a general manner 
as a "Lot," or specifically as an Lot with a numerical designation; 
collectively, they are referred to as the "Lots") shown on Exhibit "A-1." 
This Lease is and at all times shall be subordinate to the Master Lease. No 
later than ten (10) business days after the Execution Date, Landlord shall 
provide Tenant with nondisturbance agreements in favor of and acceptable to 
Tenant from the Master Landlord (and from any holders of any mortgages or 
deeds of trust which now affect the Premises or the Shopping Center), 
pursuant to which Master Landlord (or such holders of any mortgages or deeds 
of trust, as the case may be) shall agree, in the event of termination of the 
Master Lease, that Tenant's quiet enjoyment of the Premises will not be 
disturbed so long as Tenant pays Rent, attorns to Master Landlord (or such 
holder), and observes and performs all of the obligations under this Lease to 
be observed and performed by Tenant. Failure to provide Tenant with all such 
nondisturbance agreements by such date shall entitle Tenant to terminate this 
Lease by giving Landlord written notice of Tenant's intention to terminate 
this Lease within twenty (20) days after the date the nondisturbance 
agreements were due and, if Landlord fails to deliver all such nondisturbance 
agreements within ten (10) days after receipt of such notice from Tenant, 
this Lease shall terminate. Upon such termination, all rights and obligations 
of the parties, except those that expressly survive termination, shall 
terminate and be of no further force or effect. Except as otherwise 
specifically set forth in this Lease, as to the Premises all of the terms, 
provisions, covenants, and conditions set forth in the Master Lease (but not 
including Sections 2 and 3 (except to the extent of Tenant's rental 
obligations under this Lease), 11, subclause (a) of Section 14 (except as to 
the leasehold estate created hereby), Section 18.3 (but without limiting 
Tenant's obligations under Paragraph 16.2 of this Lease), and Section 38(c) 
thereof) shall constitute the terms, provisions, covenants, and conditions of 
this Lease; provided, however, that unless the context unambiguously 
otherwise requires, whatever the word "lessor" is used in the Master Lease, 
it shall be deemed to refer to Landlord hereunder, and wherever the word 
"lessee" is used in the Master Lease, it shall be deemed to refer to Tenant 
hereunder. Except as otherwise specifically limited, modified, or 
supplemented by this Lease, and specifically limited to the Premises only, 
all of the covenants, agreements, obligations, and benefits of the 
"tenant/lessee" under the Master Lease shall 

<PAGE>


constitute the covenants, agreements, obligations, and benefits of the Tenant 
hereunder, and all of the covenants, agreements, obligations, and benefits of 
the "landlord/lessor" under the Master Lease shall
constitute the rights and benefits of the Landlord hereunder, except that Tenant
shall not be responsible for any obligations or duties that were required to be
paid or performed by the Landlord as lessee under the Master Lease prior to the
term of this Lease.

         1.5 Intentionally Omitted.

         1.6 The Declaration. This Lease is subordinate to the Restated and 
Amended Declaration of Covenants, Conditions, Restrictions and Reciprocal 
Easements dated August 1, 1997, by and between the Wal-Mart Stores, Inc., a 
Delaware corporation ("Wal-Mart"), and Landlord recorded in the office of the 
Recorder of Orange County on August 12, 1997, as Instrument No. 19970385376 
(the "Declaration"). The Declaration contains protective and beneficial 
provisions in order to implement a uniform, general and common plan designed 
to preserve, protect and enhance the value, desirability and attractiveness 
of the Shopping Center, and each Lot located therein, for the benefit of the 
Landlord, and each lessee of Lots or retail space within the Shopping Center. 
The Declaration contains: restrictions on use, development, design and 
construction; maintenance obligations; grants of easements; requirements for 
payment of taxes and liens; insurance requirements; indemnity obligations; 
assessment and lien rights to enforce the Declaration; and other terms and 
conditions, with which Tenant agrees to comply. Landlord shall use all 
reasonable efforts to have the amendment to the Declaration attached hereto 
as Exhibit "H" (the "Declaration Amendment") signed within forty-five (45) 
days after the Execution Date and shall promptly notify Tenant of such 
signing. If Landlord is unable to get the Declaration Amendment signed within 
such 45-day period for any reason, Tenant shall have the right by written 
notice to the Landlord and in its sole and absolute discretion to terminate 
this Lease, in which case the parties' rights and obligations hereunder 
(except for those that expressly survive termination) shall terminate and be 
of no further force or effect. Tenant shall give notice of its election to 
terminate this Lease under this Paragraph 1.6 within ten (10) business days 
after the expiration of such 45-day period. Upon the satisfaction or waiver 
of all of the Tenant's conditions to this Lease (and provided Landlord has 
been able to get the Declaration Amendment signed), Landlord shall cause such 
Declaration Amendment to be recorded in the Official Records of Orange 
County, California, and Tenant hereby consents to such recordation. Upon 
recordation of the Declaration, all references in this Lease to the 
declaration shall mean to the Declaration as amended by the Declaration 
Amendment. Landlord agrees not to further amend the Declaration in a way that 
would materially and adversely affect Tenant's operations from the Premises 
or Tenant's benefits under this Lease without obtaining Tenant's prior 
written consent, which consent shall not be unreasonably withheld or delayed.

                                   ARTICLE 2
                                      TERM

         2.1 Term. Unless sooner terminated or extended as provided herein, the
term of this Lease shall be for the period specified in Paragraph 6 of the Lease
Summary and shall commence on the Commencement Date referred to in Paragraph 7
of the Lease Summary. Should no date be specified as the Commencement Date in
Paragraph 7 of the Lease Summary, the Commencement Date shall be the date of the
first to occur of either of the following two events:

         (a) The later to occur of (I) one hundred and eighty (180) days 
after Landlord (or Landlord's supervising architect or other authorized 
agent) tenders possession of the Pad to Tenant pursuant to Paragraph 4 of 
Exhibit "C" -Construction Exhibit, or (II) one hundred and eighty (180) days 
after permits are available for Tenant to start the Tenant its construction 
of the "Tenant Improvements" (as defined in Exhibit "C"); or

         (b) Upon the date Tenant actually commences to do business in, upon or
from the Premises.

Landlord shall deliver possession of the Pad to Tenant when all of the
conditions to Landlord's performance under this Lease have been satisfied or
waived. If Landlord is delayed in the delivery of possession of the Pad to
Tenant for any reason other than Tenant-caused delays (in which event there
shall be no change in the Commencement Date), the "Commencement Date" shall be
adjusted, accordingly. Notwithstanding anything in this Lease expressed or
implied to the contrary, the Construction Exhibit attached as Exhibit "C" to
this Lease shall be in full force and effect as of the Execution Date of this
Lease.

         2.2 Supplemental Agreement. When the Commencement Date is not specified
in Paragraph 7 of the Lease Summary and, as a consequence, has been determined
as hereinabove set forth, then, within five (5) days after Tenant's receipt of
Landlord's written request therefor, Tenant agrees to execute a Supplemental
Agreement in the form attached hereto as Exhibit "F," to become a part hereof,
setting forth the Commencement Date and the expiration date and the date by
which Tenant must give Landlord notice of intent to exercise an extension
option.

         2.3 Improvement Work. Landlord shall at its sole cost and expense,
promptly and diligently perform and complete all site preparation and Site
Improvements duties that are Landlord's responsibilities 

                                       2
<PAGE>

under and in accordance with Exhibit "C" and shall deliver possession of the Pad
to Tenant substantially in accordance with the terms of Paragraphs 2.1(a) and
Exhibit "C". Any construction and/or installation of Tenant's Improvements,
fixturization or other work on the Premises that is to be performed by Tenant
shall be the sole responsibility of Tenant.

         2.4 Landlord's Failure to Complete. Notwithstanding anything to the
contrary herein, should Landlord fail to deliver possession of the Pad
substantially in accordance with the terms of Exhibit "C" by June 1, 1998, this
Lease shall then be voidable, at the option of Tenant, upon ten (10) days
written notice to Landlord, provided that Tenant gives such notice by June 11,
1998. If the work required to be performed by Landlord pursuant to Exhibit "C,"
if any, in order to deliver possession of the Pad to Tenant, depends in whole or
in part upon work to be performed in connection therewith by Tenant, then the
Pad shall be deemed to have been delivered to Tenant on the date that the Pad
would have been delivered if Tenant had performed the work required of Tenant in
a diligent and timely manner and in accordance with the schedule for the
performance of said work established by Landlord's project architect. The
reasonable determination by Landlord's project architect as to the date
possession of the Pad is delivered to Tenant in accordance with the terms of
Paragraph 2.1(a), taking into consideration delays, if any, caused by Tenant, as
aforesaid, shall be conclusive upon the parties hereto. If through no fault of
Landlord, Landlord fails to deliver possession of the Pad within one (1) year
after the Execution Date (and Tenant has not otherwise canceled this Lease as
provided in this Paragraph 2.4), either Landlord or Tenant may cancel this
Lease. In the event of any such termination, neither party shall have any
liability or obligation whatsoever to the other, except for any obligations
hereunder that expressly survive termination and that any deposit by Tenant
shall promptly be refunded, without interest, by Landlord.

         2.5 Opening of Tenant's Premises. Promptly after delivery of possession
of the Pad, Tenant agrees to, at its sole cost and expense, (i) perform all of
Tenant's work set forth in Exhibit "C"; (ii) equip the Building with new trade
fixtures and all new personal property necessary or proper for the operation of
Tenant's business; and (iii) open for business as an Eagle Hardware store. If
Tenant fails to comply with its obligations under this Paragraph 2.5, Landlord
may, in addition to and without limiting any other remedies available at law or
in equity, terminate this lease.

         2.6 Lease Year. The term "Lease Year" shall refer to each successive
twelve (12) month period following the Commencement Date.

         2.7 Options To Extend Term. Landlord hereby grants to Tenant the 
right to extend the term of this Lease (the "Extension Option") for one (1) 
additional term of ten (10) years followed by two (2) additional success 
terms of five (5) years each by giving Landlord written notice of its 
intention to do so in each instance at least one (1) year (but not more than 
two years) prior to the expiration of the then-current term. The term as so 
extended shall be upon the same terms and conditions as set forth in this 
Lease, except that the Fixed Rent during the extended term shall be 
determined in the manner provided in Paragraph 3.2, below. Should Tenant in 
any instance fail to give timely written notice of its intention to exercise 
its option to extend the term, Tenant shall be deemed to have elected not to 
exercise its said right to extend the term, and this Lease shall expire in 
accordance with its terms. Time is of the essence with respect to the 
requirement that Tenant give timely notice of its election to exercise its 
right to extend the term, and Tenant's failure timely to exercise any option 
shall constitute a material, irredeemable and incurable failure to satisfy a 
condition precedent to the vesting of such right, and Tenant hereby expressly 
waives any right to claim relief from forfeiture, or any other equitable 
relief, from the consequences of any untimely exercise of its right to extend 
the term of this Lease. The implied covenant of good faith and fair dealing 
under this Lease shall not be construed to impose upon Landlord any 
obligation to notify Tenant in advance of the impending deadline for the 
exercise of any option, nor shall it obligate Landlord to excuse the tardy 
exercise of any option, however slight. Notwithstanding anything to the 
contrary set forth above, Tenant shall not have the right to exercise any 
option to extend the term of this Lease (i) during the time commencing from 
the date Landlord gives Tenant a written notice that Tenant is in default 
under any material provision of this Lease and continuing until the default 
described in said notice is cured, (ii) during the period of time commencing 
on the day after a monetary obligation to Landlord is due from Tenant and 
unpaid and continuing until the obligation is paid, or (iii) as to the second 
and third Extension Options, if the prior options were not timely exercised. 
The period of time within which any option may be exercised shall not be 
extended or enlarged by reason of tenant's inability to exercise such option 
prior to satisfaction of the foregoing conditions precedent. The Extension 
Option may not be exercised or assigned involuntarily by or to any person or 
entity other than Tenant except as provided in Article 17, nor shall the 
Extension Option be assignable apart from this Lease.

                                   ARTICLE 3
                                   FIXED RENT

         3.1 Payment. From and after the Commencement Date during the Term of 
this Lease, Tenant shall pay to Landlord, at the address in the Lease Summary 
or such other address as Landlord designates in writing, the fixed rent, as 
set out in Paragraph 4 of the Lease Summary and adjusted pursuant to 
Paragraph 3.2, below (the "Fixed Rent"), on the first day of each month, in 
advance. If the Commencement Date occurs on a day other than the first day of 
a month, then the Fixed Rent for the fraction of the month starting with the 




                                       3

<PAGE>


Commencement Date shall be paid on the Commencement Date, prorated on the 
basis of the actual number of days in such month. If the term hereof ends on 
a day other than the last day of a month, then the Fixed Rent for the month 
during which the expiration occurs shall be prorated on the basis of the 
actual number of days in such month. In addition to the Fixed Rent, Tenant 
agrees to pay "Common Areas Operating Costs" (as described in Paragraph 4.1, 
below). The Fixed Rent, Common Areas Operating Costs, Landlord's Taxes and 
any other monetary obligations due Landlord under the Lease are hereinafter 
referred to collectively as the "Rent." The Rent shall be payable to 
Landlord, in lawful money of the United States of America, in currently 
available funds at the address for Landlord set forth in the Lease Summary 
(or to such other person or at such other place as Landlord may from time to 
time designate writing), without notice, demand, offset, deduction or 
setoff. In no event shall the Rent be reduced by any other provision of this 
Lease for sums payable by Landlord. "Force Majeure" (as defined in Exhibit 
"C") shall be deemed to impact the Commencement Date under this Lease.

         3.2 Cost of Living Adjustment. The Fixed Rent payable for each Lease
Year, including during the Extension Options, shall be increased every five (5)
years during the term of this Lease, including the option terms, by the product
of (a) 2.50, multiplied by (b) the percentage increases, if any, in the Consumer
Price Index-All Urban Consumers (Los Angeles-Anaheim-Riverside Area; Base:
1982-84=100) (the "Index") as published by the United States Department of
Labor, Bureau of Labor Statistics (the "Bureau"). Notwithstanding the foregoing,
with respect to each five (5) year period of this Lease term, including the
Extension Options, in no event shall the percentage increase in the Fixed Rent
exceed a cumulative increase of ten percent (10%) from the prior five (5) year
period. For example, the Fixed Rent for the second five (5) years shall not
exceed $825,000 per year. The Index for the calendar month preceding the first
calendar month of each Lease Year in which an adjustment in the Fixed Rent is
required, as aforesaid, shall be compared with the Index for the calendar month
sixty (60) months earlier, and Fixed Rent shall be increased in accordance with
the percentage increase, if any, between such two (2) monthly indexes. In no
event shall Fixed Rent be decreased. Landlord shall calculate and give Tenant
written notice of any such increase in Fixed Rent, and the same shall be due and
payable by Tenant, retroactively, as of the first day of the Lease Year in which
the adjustment went into effect. Pending the calculation of the increase of
Fixed Rent as provided herein, Tenant shall continue to pay the same Fixed Rent
which it had been paying during the immediately preceding period and shall
promptly pay the deficiencies, if any, upon demand therefor by Landlord. No
delay or failure by Landlord to enforce this provision or any part thereof as to
Tenant, or to enforce similar or dissimilar provisions in other leases in use as
to any other tenants in the Shopping Center, shall be deemed to be a waiver
hereof, or prevent any subsequent or other enforcement hereof. If the Bureau
shall change the base reference period from 1982-84=100 or otherwise changes its
method of computing the Index, the successor Index so published shall be used by
applying an appropriate conversion formula or table as may be supplied by the
Bureau. If the region covered by the Index is changed, the renamed local Index
covering the region in which the Shopping Center is located shall be used. If
the publication frequency is changed, so that a monthly Index is not available
to make a cost of living adjustment in the Fixed Rent as specified herein, the
increase shall be based on the percentage difference between the Index for the
closest preceding calendar month prior to the Commencement Date for which a
monthly Index figure was available. Should the Bureau discontinue the
publication of the Index, or publish the same less frequently, or alter the same
in some other manner, Landlord, in its reasonable discretion, shall adopt a
substitute Index or procedure which reflects and monitors consumer prices.
Tenant shall promptly pay the deficiencies, if any, upon demand therefor by
Landlord.

                                   ARTICLE 4
                                ADDITIONAL RENT

         4.1 Common Areas Operating Costs; Definitions.

         (a) The term "Common Areas Operating Costs" shall mean the sum of all
expenses paid or incurred by Landlord in connection with the operation,
maintenance, repair, alteration and periodic replacement of any part or portion
of the improvements maintained by Landlord in the Common Areas (that are not
paid directly by, or separately metered or otherwise chargeable to, individual
tenants) during the twelve-month period (currently July 1 through June 30)
utilized by Landlord as the fiscal year for the Shopping Center ("Fiscal Year"),
less the fixed contributions to such costs, if any, made by or on behalf of
particular tenants or occupants of the Shopping Center. Without limiting the
generality of the foregoing, the Common Areas Operating Costs shall include:

         (i) electricity, water, gas, sewers, refuse collection and all other
utilities and utility services;

         (ii) all utility taxes, charges, or similar impositions;

         (iii) programs instituted to comply with governmental transportation
management requirements, and all repairs, improvements and alterations required
by any Federal, State and/or 

                                       4
<PAGE>

local law, regulation or ordinance, or necessary to ensure that the Common Areas
remain in compliance with all laws and regulations applicable thereto;

         (iv) all periodic replacements of capital improvements in the Common
Areas required as a result of wear and tear or to improve efficiency of
operation, amortized on a straight line basis over their useful life as
determined in the reasonable judgment of Landlord (or over the period of cost
recovery or depreciation permitted by the U.S. Internal Revenue Code, if
shorter), with interest thereon at the rate being paid by Landlord, from time to
time, in connection with the financing of the improvements in question;

         (v) period replacements and/or installation of personal property used
in connection with the Common Areas (the "Associated Personal Property"),
amortized over a period of five (5) years on a straight line basis with interest
thereon at the rate currently being paid by Landlord in connection with the
financing of such Associated Personal Property;

         (vi) rental paid for leased machinery, tools, equipment, and motor
vehicles used in connection therewith;

         (vii) maintenance and repair of electrical services and resurfacing and
repainting of parking lots, restriping, repairs to parking lots, sidewalks and
pedestrian passageways, cleaning, sweeping and janitorial services, landscaping,
light fixture and bulb replacement, trash and refuse receptacles, directional
signs and markers, and car stops. Tenant shall not be responsible for its
Proportionate Share for replacements of the parking lot asphalt more than once
every ten (10) years (unless more frequent replacements of such asphalt are
required to meet the standards set forth in the Declaration, in which case
Tenant shall be responsible for its full Proportionate Share);

         (viii) insurance premiums and deductibles (for the Common Areas
policies referred to in Paragraph 16.3 herein), and alterations or replacements
of capital improvements in the Common Areas required by Landlord's insurance
carriers, or any of them, as a condition to the issuance or continuance of such
insurance;

         (ix) the services of independent contractors including, without
limitation, the services of any person, firm or corporation selected by Landlord
to maintain the Common Areas or to provide security, on such terms and
conditions and for such duration as Landlord shall, in its sole judgment, deem
reasonable and appropriate;

         (x) compensation (including, without limitation, employment taxes,
workers' compensation premiums, and fringe benefits) of all persons, whether or
not directly employed by Landlord, to the extent they perform duties in
connection with the operation, maintenance, repair and periodic replacement of
any part of portion of the improvements and/or Associated Personal Property in
the Common Areas;

         (xi) legal and accounting services engaged by Landlord for the Common
Areas;

         (xii) "Landlord's Taxes" (as hereinafter defined);

         (xiii) costs to construct, install, operate, and maintain tenant
signage; Tenant and each tenant included on the freeway Shopping Center pylon
sign shall pay its proportionate share of the costs;

         (xiv) any other expenses or charges of whatsoever kind, whether or not
hereinabove described, which, in accordance with generally accepted accounting
or management principles, would be considered an expense of operating,
maintaining, repairing and periodically replacing any part or portion of the
Common Areas and/or Associated Personal Property located or used in the Common
Areas, plus ten percent (10%) of all of said costs to cover Landlord's
administrative and overhead costs, and to compensate Landlord for supervision of
the operation, maintenance, and repair and periodic replacement of any part or
portion of the Common Areas. Said ten percent (10%) of costs shall be reduced by
amounts paid by Landlord to a management company performing some or all of the
management of the Common Areas. The ten percent (10%) shall not be applied to
Common Areas insurance premiums, Common Areas real property taxes, Common Areas
capital expenditures, or any third party management fees or other costs
associated with third party management of the Shopping Center.

     (b) Common Areas Operating Costs shall not include:

         (i) the costs of special services rendered to tenants (including
Tenant) for which a special charge is made to such tenants;

         (ii) any costs borne directly by Tenant under this Lease;

         (iii) Landlord's ground rent, if any;

                                       5
<PAGE>

         (iv) interest or amortization paid by Landlord in connection with any
loan or loans secured by the real property of which the Premises or Common Areas
are a part, unless said loans are made to finance costs expressly included above
in the definition of Common Areas Operating Costs; and

         (v) expenses associated with the initial construction of the Center,
the Common Areas or any Common Areas improvements, including expenses of
correcting any defects in initial design or construction;

     (c) The term "Estimated Common Areas Operating Costs" shall mean the
monthly estimates of Tenant's Proportionate Share of Common Areas Operating
Costs for each Lease Year to be given by Landlord to Tenant pursuant to the
terms hereof.

     (d) The term "Landlord's Taxes" shall mean and include all real and
personal property taxes, charges and assessments, water and sewer rents and
taxes on parking of any description, which are levied, assessed upon or imposed
by any governmental authority of every kind and nature whatsoever, general and
special, during any Fiscal Year with respect to the Common Areas and all
improvements thereon, fixtures and equipment and all other property of Landlord,
real or personal, located in the Shopping Center and used in connection with the
operation, maintenance, repair and periodic replacement of any part or portion
of the Common Areas (computed as if paid in permitted installments regardless of
whether actually so paid), and any tax which shall be levied or assessed to or
in lieu of such real or personal property taxes (including without limitation,
any value added tax or municipal income tax), and any license fees, commercial
rental tax or other tax upon rents, the entering into of leases, or Landlord's
business of leasing or operating the Shopping Center, including all costs and
fees (including reasonable attorneys' fees) incurred by Landlord in contesting
taxes, assessments and/or negotiating with the public authorities as to same;
provided, however, that the term "Landlord's Taxes" shall not include any
federal, state, or local income tax, or any franchise, estate or inheritance
taxes. The term "Landlord's Taxes" shall also include any tax, fee, levy,
assessment or charge (i) in substitution, partially or totally, of any tax
previously included within the definition of Landlord's Taxes, or (ii) which is
imposed for a service or right not charged prior to June 1, 1978, or, if
previously charged, has been increased since June 1, 1978, or (iii) which is
imposed as a result of a transfer, either partial or total, of Landlord's
interest in the Shopping Center or any part thereof or which is added to a tax
or charge hereinbefore included within the definition of Landlord's Taxes by
reason of such transfer (provided that this subclause (iii) is mean to apply to
increases in property taxes resulting from any such transfer, but not to the
imposition of any documentary transfer tax which may be assessed upon such
transfer), or (iv) which is imposed by reason of this transaction, any
modifications or changes hereto, any transfer hereof, or any Modification of the
Common Areas or any portion thereof.

         4.2 Payment of Tenant's Proportionate Share. Tenant shall pay Tenant's
Proportionate Share of the Common Areas Operating Costs as set forth in
Paragraph 9 of the Lease Summary. Tenant shall pay to Landlord, in advance, on
the first day of each calendar month commencing on the Commencement Date, an
amount estimated by Landlord, from time to time, as being one-twelfth (1/12) of
Tenant's Proportionate Share for such Fiscal Year. Thereafter, within sixty (60)
days after the end of each Fiscal Year, Landlord shall deliver to Tenant a
written statement setting forth the amount of Tenant's Proportionate Share of
the actual Common Areas Operating Costs for such Fiscal Year. If the aggregate
payments made by Tenant for any such Fiscal Year exceed the amount of Tenant's
Proportionate Share for such Fiscal Year, such excess shall be applied as a
credit against future payments to be made by Tenant under this Paragraph. If the
aggregate payments made by Tenant for any such Fiscal Year are less than the
amount of Tenant's Proportionate Share for such Fiscal Year, Tenant shall,
immediately upon demand therefor, pay Landlord the amount of any such
deficiency. Notwithstanding the foregoing, subsequent adjustments may be made by
Landlord as a result of information not available or expenses not determined or
determinable at the time any particular adjustment is made. In the event that
the Commencement Date is other than the first day of a full calendar month, the
first monthly payment shall be a pro rata amount of a full monthly contribution.
In the event that this Lease should end on any date other than the last day of a
Fiscal Year, Tenant's Proportionate Share shall be adjusted on the basis of the
ratio which the number of days which have elapsed from the commencement of the
said Fiscal Year to the later of the date on which this Lease terminates or
Tenant otherwise surrenders possession of the Premises bears to 365. Tenant's
obligation to pay Tenant's Proportionate share shall survive termination or
earlier expiration of this Lease. The term "Tenant's Proportionate Share" is
subject to adjustment from time to time, and Landlord expressly reserves the
right to adjust Tenant's Proportionate Share as is necessary to conform as-built
square footage, to reflect changes in the size of the Shopping Center subject to
Common Areas Operating Costs, or to reasonably operate the Shopping Center.
Tenant's Proportionate Share is the ratio, stated as a percentage, which the
number of square feet in Tenant's "Pad" (as defined in Paragraph 3 of the Lease
Summary and shown on Exhibit D and as may be adjusted by verification subsequent
to the completion of construction), bears to the total number of square feet of
building pads subject to Common Areas Operating Costs. Should the gross leasable
area of the Shopping Center ever vary from what it is as of the Commencement
Date, Tenant's Proportionate Share shall be adjusted so it is the ratio, stated
as a percentage, which the number of square feet in the Tenant's Pad bears to
the total number of square feet in all building pads in the Shopping Center then
subject to Common Areas Operating Costs.

                                       6
<PAGE>

         4.3 Landlord's Records. Landlord shall keep and maintain customary
records of all expenses incurred in connection with the operation, maintenance,
repair and periodic replacement of any part or portion of the improvements in
the Common Areas, and the same shall, upon at least ten (10) day's written
notice, be made available for inspection by Tenant at Tenant's expense during
regular business hours at the offices of Landlord, provided that such inspection
shall not occur more than once during any twelve (12) month period. If Tenant
does not dispute the same in writing within one (1) year of receiving the annual
written statement setting forth the amount of Tenant's Proportionate Share of
the actual Common Areas Operating Costs for such Fiscal Year, Tenant shall have
irrevocably waived its right to dispute such determination or calculation.

                                   ARTICLE 5
                             INTENTIONALLY OMITTED

                                   ARTICLE 6
                                SECURITY DEPOSIT

         Tenant shall deposit with Landlord one (1) month's rent (the 
"Deposit") as security for the full and faithful performance of each and 
every obligation of Tenant pursuant to the provisions of this Lease to be 
performed by Tenant, and any renewals or extensions of this Lease, if any. In 
each instance when the Fixed Rent increases during the Lease Term, Tenant 
shall, within five (5) business days after written demand therefor, deposit 
with Landlord an additional sum so that the amount of the Deposit held by 
Landlord shall at all times be the equivalent of one month's rent. If Tenant 
defaults with respect to any provision of this Lease, including, without 
limitation, the provisions relating to the payment of Rent, the reimbursement 
of all costs incurred by Landlord in the enforcement of its remedies under 
this Lease, including, without limitation, attorneys' fees and expenses, the 
repair of damage to the Premises or the Common Areas and/or the cleaning of 
the Premises upon termination of this Lease, Landlord may, to the full extent 
permitted by law, use, apply or retain all or any portion of the Deposit for 
payment of any Rent or other sum in default, for reimbursement of such costs 
and expenses, the repair of such damage, the cost of such cleaning or the 
payment of any other amount which Landlord for any other loss or damage which 
Landlord may suffer by reason of Tenant's default or to compensate Landlord 
for any other loss or damage which Landlord may suffer by reason of Tenant's 
default or to compensate Landlord for any other loss or damage which Landlord 
may suffer by reason of Tenant's default. If any portion of the Deposit is so 
used or applied, Tenant shall, within five (5) business days after written 
demand therefor, deposit cash with Landlord in an amount sufficient to 
restore the Deposit to its original amount, and Tenant's failure to do so 
shall constitute a material breach of this Lease. Landlord's obligations with 
respect to the Deposit are those of a debtor and not a trustee. Landlord 
shall not be required to keep the Deposit separate from its general funds, 
and Tenant shall not be entitled to interest on the Deposit. If Tenant shall 
fully and faithfully perform each and every provision of this Lease to be 
performed by it, the Deposit or any balance thereof shall be returned to 
Tenant (or, at Landlord's option, to the last assignee of Tenant's interest 
hereunder) within a reasonable period following the expiration of the Lease 
term. The Deposit shall not constitute advance rent or liquidated damages, 
nor shall Landlord's application of the Deposit in any way limit or restrict 
the remedies which would otherwise be available to Landlord. Notwithstanding 
anything to the contrary contained herein, so long as Tenant is the original 
tenant named herein, Tenant shall not be required to deposit the Deposit.

                                   ARTICLE 7
                        UTILITIES AND SECURITY SERVICES

         7.1 Installation. Tenant shall install and use the utilities (including
water, gas, electricity, sewers and telephone supplied to or serving the
Premises) in accordance with the criteria set forth in Exhibit "C" hereof, and
Landlord's reasonable rules and regulations and the rules and regulations of the
public utility company or the governmental agency supplying the same. Landlord
shall not be responsible for providing any meters or other devices for the
measurement of utilities supplied to the Premises. Tenant shall make application
for and arrange for the installation of all meters or other devices.

        7.2 Utilities. Tenant, at Tenant's sole cost and expense, shall pay
directly, prior to delinquency, all charges, duties and rates of every
description for water, gas, telephone and trash removal services, and all other
services and utilities supplied to the Premises together with any taxes or
surcharges thereon during the entire term of this Lease. Landlord shall not be
liable for, and Tenant shall not be entitled to, any abatement or reduction of
Rent by reason of any interruption or reduction in the amount or level of any of
the foregoing when such failure or reduction is caused or mandated by accident,
breakage, repairs, strikes, lockouts or other labor disturbances or labor
disputes of any character, or any law, regulation, rule, ordinance or court
order limiting or restricting the availability, use or consumption of utility
items, or by any other cause, similar or dissimilar. Landlord shall not be
liable under any circumstances for any loss of or damage or injury (including
death) to the person, property, or business of Tenant, any "Tenant Agent" (as
that term is defined in Paragraph 28(h)) or any other person, however occurring,
through or in connection with or incidental to the interruption or
discontinuance of any of the utilities or services described in this Article 7.

                                       7
<PAGE>

         7.3 Security Services. Landlord may, but shall be under no obligation
to, provide one or more security guards or a security service for the Shopping
Center; provided, however, that in no event shall Landlord be liable or
responsible for any loss of or damage or injury (including death) to the person,
property or business of Tenant, any Tenant Agent or any other person suffered by
reason of the absence of such security service or of any negligence, failure,
act or omission on the part of any security guard or service so provided. The
costs of any such security guard(s), or service(s) shall be included in Common
Areas Operating Costs.

         7.4 Utility Services by Landlord. Should Landlord elect or be required
by any governmental authority to supply any utility services used or consumed in
the Premises, Tenant agrees to purchase and pay Landlord, as Additional Rent for
the same, at a cost not to exceed that which the utility company would have
charged Tenant for furnishing such utilities directly to Tenant. Tenant shall
pay such utilities costs to Landlord upon demand. If Landlord, as an
accommodation to Tenant, furnishes Tenant any utility hereunder, Landlord may,
at any time, at Landlord's sole option and upon not less than thirty (30) days
prior notice to Tenant, discontinue such service to the Premises, and Tenant
shall arrange for such service as provided in Paragraph 7.1, above. In the event
any of Tenant's utility charges are not separately metered, Tenant shall pay its
share of such charges based upon Tenant's use as determined by Landlord, in its
best judgment, as Additional Rent, upon written notice thereof from Landlord to
Tenant.

                                   ARTICLE 8
                      USE OF PREMISES, COMPLIANCE WITH LAW

         8.1 Use. Tenant shall use and occupy the Premises, as set forth in
Paragraph 8.2 herein, for the use specified in Paragraph 10 of the Lease
Summary, and Tenant shall not use or occupy the Premises for any other purpose
whatsoever (and including, without limitation, any of the restricted or
prohibited uses included in the Declaration), it being understood and agreed
that the restrictions on Tenant's use hereunder are to and for the benefit
solely of Landlord and are part of the consideration for Landlord's execution of
this Lease. Without limiting the above, Tenant shall not use or occupy the
Premises or the Common Areas in violation of law, and shall immediately
discontinue any use of the Premises or the Common Areas which is declared by any
governmental authority having jurisdiction to be a violation of law or
regulation. Landlord's failure to object to such use shall not constitute a
consent to a use which constitutes such a violation. Tenant, at its sole cost
and expense, shall comply, promptly, with any directive of any governmental
authority having jurisdiction which shall impose any duty upon Tenant or
Landlord with respect to the Premises, or the use or occupation thereof.

         8.2 Obligation to Open or Operate. Tenant shall construct the Tenant's
Improvements and shall open for business as a fully-stocked, fully-staffed Eagle
Hardware and Garden store in accordance with the terms and conditions of this
Lease, and (except for reasonable periods of continuous and diligent remodeling
or repairs, or "events of delay" beyond the reasonable control of Tenant
described in Paragraph 28(i)) shall during the term of this Lease keep the
Premises open for business on such days and during such hours as are reasonable
and customary for Tenant's operations from time to time.

         8.3 Increased Risk. Tenant agrees that Tenant will not do anything in
or upon the Premises which may be prohibited by any insurance policy in force
carried by Landlord or Tenant, from time to time, covering the Shopping Center
or any portion thereof. In the event Tenant's occupancy or conduct of business
in or upon the Premises (whether or not Landlord has consented to the same)
results in any increase in premiums for (or cancellation of) the insurance
carried from time to time by Landlord with respect to the Shopping Center,
Tenant shall, at Landlord's option, either cease such use or conduct,
immediately, or pay any resulting increase in premium upon demand therefor from
Landlord. In determining whether increased premiums or cancellation are a result
of Tenant's occupancy of the Premises, the written determination of the insurer
shall be conclusive. Tenant shall promptly comply with all reasonable
requirements of the insurance authority or of any insurer now or hereafter in
effect relating to the use and/or maintenance of the Premises.

         8.4 Landlord's Recapture Rights. Landlord shall have the option to
terminate this Lease and recapture the Premises by giving Tenant written notice
thereof following the date of one of the following events:

         (a) The failure of Tenant to keep the Premises open for business for
any sixty (60) consecutive-day period, excluding any closures for continuous and
diligent rebuilding, restoration, additions, remodeling, or repairs, or events
of delay as described in Section 28(i) below; or

         (b) One hundred eighty (180) days following commencement of demolition
of the Premises and failure to diligently and continuously rebuild, replace or
use the Premises for commercial purposes.

         In the event Landlord elects to terminate the Lease, such termination
shall be effective on the date thirty (30) days from the date of Tenant's
receipt of Landlord's notice of termination, unless within such 

                                       8
<PAGE>

thirty (30) days, Tenant informs Landlord in writing that Tenant intends to 
rebuild or reopen the Premises for business, and diligently commences to 
rebuild and does in fact reopen, the Premises for business. Upon Tenant's 
surrender of the Premises, Landlord shall pay Tenant an amount equal to its 
unamortized cost of the improvements to the Premises less all costs incurred 
by Landlord to lease the Premises, including without limitation, costs of 
removal and/or demolition of improvements, alterations to the Premises, and 
marketing costs and brokers' commissions. Upon termination, this Lease 
(except for any obligations occurring prior to such termination or that 
expressly survive termination or, if requested by Landlord, Tenant's 
obligations to remove improvements, and restore the Premises) will be of no 
further force or effect, and Landlord and Tenant shall be released from all 
future obligations under this Lease.

         8.5 Restrictive Covenant. Landlord shall not lease or sell any portion
of the Shopping Center, other than the Wal-Mart parcel (Lot 1), (a) to an entity
operating more than 10,000 square feet from the Shopping Center and that carries
more than 25% of its on-site inventory in any home improvement, garden, nursery,
and building materials products typically provided by Tenant, or (b) to an
entity operating less than 10,000 square feet from the Shopping Center and that
carries more than 40% of its on-site inventory in any home improvement, garden,
nursery, and building materials products typically provided by Tenant.

                                   ARTICLE 9
                             ACCEPTANCE OF PREMISES

         9.1 As-Is-Acceptance. Tenant acknowledges that neither Landlord nor any
agent of Landlord has made any representation or warranty with respect to the
Premises and the Shopping Center or any portion or aspect thereof, or with
respect to the suitability or fitness thereof for the conduct of Tenant's
business or for any other purpose. There have been no representations or
warranties made by or on behalf of Landlord in connection with this Lease or as
to any matters concerning the Shopping Center, including but not limited to the
condition, acreage, topography, climate, water, water rights, utilities, present
or future zoning, soil, subsoil, any "Hazardous Substance" (as defined in
Article 40), the purposes for which the Shopping Center is suited, drainage,
access to public roads, or proposed routes of roads or extensions thereof. The
Premises and Pad are being leased to Tenant "as is," "where is," and "with all
faults." Tenant represents to Landlord that Tenant is relying solely on its own
independent investigation of the Shopping Center and has had sufficient time and
opportunity to make such independent investigations, inquiries, and evaluations
as Tenant deems necessary or appropriate to decide for itself the degree and
scope of risk which exists in connection with this Lease. Notwithstanding the
above, Landlord will deliver Tenant a certification executed by Landlord's
engineer with respect to the compaction of the buildable Pad area. There shall
be a conclusive presumption that the Premises and the Shopping Center were in
good and satisfactory condition on the date Landlord delivered possession of the
Pad to Tenant.

         9.2 Other Shopping Center Tenants. Tenant hereby acknowledges that the
Shopping Center is subject to certain use restrictions as set forth in the
Declaration. Tenant further acknowledges that it has read the Declaration and
agrees to be bound by all of the terms and conditions set forth therein, and
Tenant is hereby prohibited from using the Premises in any manner whatsoever
which could in any way be deemed to be in violation of any of the use
restrictions contained in the Declaration. It is expressly understood and agreed
by the parties hereto that except as otherwise herein set forth and in the
Declaration, nothing contained in this Lease, or in any manner expressed or
implied, is to be construed as in any way prohibiting, restricting or limiting
Landlord's right to use, rent or lease any portion, or all, of the Shopping
Center, or of any other property owned, managed or leased by Landlord or any
affiliate, partner, director or employee thereof, for any purpose, or use,
whether or not such purpose or use be in competition, direct or otherwise, with
the use for which the Premises herein are to be operated by Tenant, and that the
Declaration may be modified from time to time as may be permitted thereunder.
Landlord makes no warranties or representations as to the present occupants or
occupancy level of the Shopping Center, or of future occupancy commitments.
Landlord shall have the right to add or to remove major stores or kiosks, from
time to time, from the Shopping Center. Tenant waives any duty or obligation,
expressed or implied, on the part of Landlord, to keep the Shopping Center
leased or occupied, or partially leased or occupied, or to lease (or to not
lease) portions of the Shopping Center for major stores or for any other
specific purpose, use or type of use. Moreover, except as otherwise set forth in
Paragraph 8.5 or in the Declaration, Tenant acknowledges that nothing contained
in this Lease, or in any manner expressed or implied, is to be construed as
imposing any duty or obligation on the part of Landlord to prohibit or
discourage the conduct of other tenants in the Shopping Center, or that of any
other third parties, that may result in a loss or reduction of gross sales or
profitability by Tenant.

        9.3 Governmental Approval Period. Commencing on the Execution Date, 
Tenant shall have one hundred and eighty (180) days within which at its sole 
cost, expense or risk, to obtain any and all necessary governmental approvals 
and permits, including but not limited to those relating to planning, zoning, 
development, building, fire protection, roads, signage and utilities, as may 
be required by those governmental authorities having jurisdiction in order 
for Tenant to use the Premises for the construction and operation of Tenant's 
proposed Building ("Governmental Approvals"). Such 180-day period, which may 
be extended by Landlord in its discretion for an additional ninety (90) days, 
is hereinafter referred to as the "Approval Period"; the last day of the 
Approval Period is referred to as the "Approval Termination Date". During the 
Approval Period, all Governmental Approvals desired by Tenant to construct 
its Building and operate its business shall 

                                       9
<PAGE>

be obtained, issued, transferred and delivered to Tenant. Landlord shall obtain
all approvals for development of the Shopping Center (other than approval of
Tenant's specific site plan) on or before the date Tenant submits its
application for its building permit to the appropriate governmental agency.

         (a) Tenant shall, in good faith, diligently and expeditiously pursue
obtaining of the Governmental Approvals and shall keep Landlord informed of
Tenant's efforts in connection therewith.

         (b) In the event that any governmental agency having jurisdiction
thereof shall fail to approve the "Plans and Specifications" defined in Exhibit
"C" or shall fail to issue any Governmental Approvals which shall be required in
connection with the construction and/or occupancy of the Premises within the
Approval Period, either party shall have the right, within five (5) business
days after the Approval Termination Date, to terminate this lease by giving
written notice thereof to the other party, in which event this Lease shall
terminate and the parties shall have no further obligations to each other with
respect to the Premises or this Lease (except those that expressly survive
termination). In the event that either party shall fail to terminate this Lease
within the time and manner provided for herein, the Lease shall remain in full
force and effect. Notwithstanding anything to the contrary contained in this
Lease, if any governmental agency, as a condition to granting any Governmental
Approval, requires any change in the Plans and Specifications or to the Exhibit
"D" Plot Plan which Landlord or Tenant determines, in its reasonable discretion,
is material and unacceptable or which violate the Declaration, Tenant or
Landlord shall have the right to terminate this Lease by giving written notice
thereof to the other party promptly upon receipt of such information from said
governmental agency, and this Lease shall immediately terminate and be of no
further force or effect, in which event, the parties shall have no further
obligations to each other with regard to this Lease and/or the Premises (except
those that expressly survive termination). Notwithstanding the above requirement
of prompt notice, Landlord and Tenant shall each have a reasonable period of
time (not to exceed thirty (30) days) after receipt of any such information from
such governmental agency to negotiate with such agency over any such required
change before having to give notice of termination to the other party.

         (c) The failure of Tenant to timely deliver notice of termination to
Landlord on or before the Approval Termination Date shall be deemed to
constitute Tenant's satisfaction or waiver of this contingency and a waiver of
Tenant's right to terminate this Lease prior to the Commencement Date.

         9.4 Landlord Representations. Landlord represents and warrants that,
except as otherwise disclosed to Tenant in writing, as of the date of this
Lease:

         (a) Landlord has full and lawful right and authority to execute this
Lease and to deliver it to Tenant;

         (b) To Landlord's actual knowledge (limited to the actual knowledge of
the corporate officers of the general partner of Landlord and with no duty to
inquire), there are no pending or threatened actions, suits, arbitrations,
claims, or proceedings, at law or in equity, affecting the Premises;

         (c) To Landlord's actual knowledge (limited to the actual knowledge of
the corporate officers of Landlord and with no duty to inquire), the Premises is
in compliance with all applicable laws, codes, and ordinances; and

         (d) Landlord is not in default under the Master Lease. 

                                   ARTICLE 10
                                  ALTERATIONS

         10.1 Alterations. Except as provided for in Exhibit "C," Tenant shall
make no other alterations, additions or improvements ("Tenant Changes") to the
Premises affecting the outside appearance of the Premises or any other part of
the Shopping Center, structural alterations of any kind, and/or alterations
affecting basic plumbing, air conditioning, electrical or life safety systems
shared with the Common Areas or other tenants' premises, if any, without
Landlord's prior written consent which shall not unreasonably be withheld or
delayed. Whenever Landlord's consent is required for Tenant Changes,
accompanying Tenant's written request for same, Tenant shall provide to Landlord
all plans and specifications related to such alterations. Whether or not
Landlord's consent is required, upon completion of any Tenant Changes, Tenant
shall provide to Landlord a copy of the as-built plans and specifications.
Tenant acknowledges that Landlord's review of the plans is for the sole benefit
of Landlord, and Landlord's approval does not constitute any representation by
Landlord as to the compliance of such plans with any law or fitness of such
alterations for a particular purpose or use. Tenant Changes (including, without
limitation, any air conditioning equipment or devices installed in or upon the
Premises) shall become the property of Landlord and shall be surrendered with
the Premises, as a part thereof, at the end of the term or earlier termination
hereof; except that Landlord may, by written notice to Tenant prior to the
termination hereof or within sixty (60) days after termination for default,
require Tenant to remove all Tenant Changes or such portion thereof as Landlord
may designate, and to repair any damage from such removal, all at Tenant's sole
expense. Landlord may impose such restrictions 


                                       10
<PAGE>

and conditions it deems appropriate on the construction of Tenant Changes
including, without limitation, the types and amounts of insurance required to be
carried by Tenant's general contractor for the benefit of Landlord and Tenant;
and requiring Tenant to use contractors that are licensed and bondable;
provided, however, that Tenant's selection of a general contractor shall not
otherwise require Landlord's approval. Without limiting the generality of the
foregoing. Tenant hereby covenants that, before commencing any Tenant Changes
and regardless of whether or not Landlord's consent is first required, Tenant
shall (i) give Landlord at least fifteen (15) business days' written notice of
the proposed commencement of such work (to afford Landlord and/or Master
Landlord an opportunity to post appropriate notices of nonresponsibility); (ii)
secure, at Tenant's sole cost and expense, a completion and lien indemnity bond,
in an amount equal to the cost of such Tenant Changes, and in all other respects
satisfactory to Landlord for such work, and (iii) furnish Landlord with properly
executed certificates of insurance in accordance with Paragraph 16.2 evidencing
the types and amounts of insurance coverage required to be carried by Tenant's
general contractor for the benefit of the Landlord and Tenant. Tenant covenants
and agrees that all alterations done by or pursuant to the direction of Tenant
shall be performed expeditiously, in a good and workmanlike manner, strictly in
accordance with any plans and specifications related to such alterations that
were approved by Landlord, in full compliance with all laws, rules, orders,
ordinances, directions, regulations and requirements of all governmental
agencies, offices, departments, bureaus and boards having jurisdiction, in full
compliance with the rules, orders, directions, regulations, and requirements of
the Insurance Service Office or any similar body, and in a manner so as to
minimize interference with pedestrian and vehicular traffic and other businesses
in the Shopping Center. Tenant shall procure and maintain in full force and
effect during the course of such work, at Tenant's sole cost and expense,
builder's risk, insurance in an amount reasonably satisfactory to Landlord. The
provisions of this Lease are intended fully to govern the rights and obligations
of Landlord and Tenant as they relate to the need for repairs to the Premises.
Accordingly, Tenant waives and releases any rights it may have to make repairs
at Landlord's expense or to quit the Premises under Sections 941, 1942(a), and
1932(l) of the California Civil Code or under any similar law, ordinance or
regulation which may now exist or hereafter be enacted or enforced which confers
upon Tenant the right to make any repairs to the Premises of the type allocated
to Landlord by this paragraph, whether or not for the account of Landlord, or to
terminate this Lease because of Landlord's failure to keep the Premises or the
Shopping Center in good order, condition and repair.

         10.2 Other Tenant Changes. If any alteration, addition, replacement or
change shall be required by law or the requirements of any insurance company (as
a condition to the issuance or continuation of insurance coverage without
increase in Premium) to be made to the Premises for any reason including,
without limitation, (i) Tenant's failure to maintain the Premises in the manner
required hereby, (ii) Tenant's use of the Premises, a change in the manner or
mode of Tenant's use of the Premises, or the location of partitions, trade
fixtures, merchandise or other contents of the Premises, or (iii) any
requirement of law or ordinance or other requirement of any government or other
authority, then, such alterations, additions, replacements or changes shall be
promptly made and paid for solely by Tenant in accordance with Paragraph 10.1,
above.

                                   ARTICLE 11
                             LIENS AND ENCUMBRANCES

         11.1 Tenant's Covenants. Tenant covenants and agrees to keep the
Premises, the Shopping Center, and Tenant's leasehold interest therein, free
from any mechanics' liens or other encumbrances, and that any such liens or
encumbrances for any obligation or for work claimed to have been furnished, done
for, obligations incurred for or materials claimed to have been furnished to
Tenant or any other party, will be discharged by Tenant, by bond or otherwise,
within ten (10) days after Tenant learns of the filing thereof, at the cost and
expense of Tenant, and Tenant further agrees to defend, indemnify and hold
harmless Landlord from and against any such liens or claims or actions thereon,
together with costs of suit and attorneys' fees incurred by Landlord in
connection with any such claims or actions. If any such liens are filed and
Tenant fails to discharge such liens, by bond or otherwise, within such ten (10)
days after Tenant learns of the filing thereof, Landlord may, without waiving
its rights and remedies based on such breach of Tenant and without releasing
Tenant from any of its obligations, cause such liens to be released by any means
it shall deem proper, including payment in satisfaction of the claims giving
rise to such liens. Tenant shall reimburse Landlord, within ten (10) days after
demand therefor, for any sum paid or incurred by Landlord to remove such liens.
Tenant shall have the right to contest any such liens or claims and not be in
violation of this Article 11, and Landlord shall cooperate with Tenant in the
prosecution of such contest (at no cost or expense to Landlord); provided,
however, that Tenant must first pay, bond over, or otherwise discharge any such
liens as a condition to initiating and pursuing such contest.

         11.2 Landlord's Covenants. Tenant has acknowledged that, pursuant to
the terms of that certain Development Agreement dated October 31, 1996, as
modified by First Amendment thereto dated June 23, 1997 between Landlord and
Wal-Mart for the Shopping Center (a memorandum of which was recorded on August
12, 1997 as Instrument No. 19970385377 in the Official Records of Orange County,
California), Wal-Mart has the right to place a lien against the Premises in the
event Landlord fails to comply with certain site development obligations.
Landlord shall, prior to the Commencement Date, discharge (by payment, bond, or
otherwise) any such lien from the Premises. Landlord further agrees to defend,
indemnify and hold harmless Tenant from and against any such lien or claims or
actions thereon, together with costs of suit and attorneys' 


                                       11
<PAGE>

fees incurred by Tenant in connection with any such claims or actions. Landlord
shall have the right to contest any such liens or claims and not be in violation
of this Article 11, and Tenant shall cooperate with Landlord in the prosecution
of such contest (at no cost or expense to Tenant); provided, that Landlord must
first pay, bond over, or otherwise discharge any such liens as a condition to
initiating and pursuing such contest.

                                   ARTICLE 12
                  TAXES ON THE PREMISES AND TENANT'S PROPERTY

         12.1 Personal Property Taxes. Tenant shall be liable for, and shall pay
not later than ten (10) days before delinquency, all taxes levied against
Tenant's Property (as that term is defined below) and any other personal
property of whatsoever kind and to whomsoever belonging, located or installed in
or about the Premises commencing on the date Tenant's Property or such other
personal property is placed in or about the Premises (and, upon demand by
Landlord, Tenant shall furnish Landlord with evidence to Landlord's satisfaction
of payment thereof). The term "Tenant's Property" shall mean all interior signs,
trade fixtures, furniture and equipment and other moveable items installed or
placed on the Premises by or at the direction or with the consent of Tenant,
regardless of ownership, exclusive of fixtures paid for by Landlord, if any,
pursuant to Exhibit "C." If any such taxes on Tenant's Property or other
personal property are levied against Landlord or Landlord's property and if
Landlord pays the same (which Landlord shall have the right to do regardless of
the validity of such levy, but only under proper protest if requested in writing
by Tenant), or if the assessed value of Landlord's property is increased by the
inclusion therein of a value placed upon Tenant's Property or such other
personal property, and if Landlord pays the taxes based upon such increased
assessment (which Landlord shall have the right to do regardless of the validity
thereof, but only under proper protest in writing if requested by Tenant),
Tenant shall repay to Landlord, within ten (10) days after demand therefor, the
taxes so paid by Landlord and any expenses incurred by Landlord in connection
therewith, together with interest thereon at the Lease Rate (as defined in
Paragraph 22.11). In any such event Tenant shall have the right, in the name of
Landlord and with Landlord's full cooperation, but at no cost to Landlord, to
bring suit in any court of competent jurisdiction to recover the amount of any
such taxes so paid under protest, any amount so recovered belonging to Tenant.

         12.2 Real Property Taxes. From and after the Execution Date, Tenant
shall pay the real property taxes, as defined below, applicable to the Premises
through the entire term of this Lease, including all option terms. All such
payments shall be made at least five (5) business days prior to the delinquency
date. Tenant shall promptly furnish Landlord with satisfactory evidence that
such taxes have been paid. If any such taxes paid by Tenant covers any period of
time after the expiration of the term hereof, Tenant's share of such taxes shall
be equitably prorated to cover only the period of time within the tax fiscal
year during which this Lease shall be in effect, and Landlord shall reimburse
Tenant to the extent required. If Tenant shall fail to pay any such taxes,
Landlord shall have the right to pay the same, in which case Tenant shall repay
such amount to Landlord with Tenant's monthly installment of Fixed Rent together
with interest on such amounts at the Lease Rate (as defined in Paragraph 22.11,
below). If the Premises are not separately assessed, Landlord shall pay all real
property taxes on the Premises, and Tenant shall pay the Landlord, within thirty
(30) days after request therefor, Tenant's Proportionate Share of the real
property taxes imposed upon the entire Shopping Center and all of the buildings
and structures located on the Shopping Center. Tenant shall pay to Landlord as
Additional Rent, together with the payment of Fixed Rent, or other payments
required hereunder which are subject to any excise tax on gross income derived
by Landlord under this Lease, regardless of how designated, excluding federal
and state income taxes, imposed by any governmental body having jurisdiction, an
amount which, when first added to such Fixed Rent, or other payments shall, then
yield to Landlord, after deduction of such taxes payable by Landlord with
respect to all such payments, a net amount equal to that which Landlord would
have received from such payments had no such tax been imposed. As used herein,
the term "real property taxes" shall include any form of real estate tax or
assessment, general, special, ordinary or extraordinary, and any license fee,
commercial rental tax, improvement bond or bonds, levy or tax (other than
inheritance, personal income or estate taxes) imposed on the Premises by any
authority having the direct or indirect power to tax, including any city, state
or federal government, or any school, agricultural, sanitary, hospital, fire,
street, drainage or other improvement district thereof, as against any legal or
equitable interest of Landlord in the Premises or in the real property of which
the Premises are a part, as against Landlord's right to rent or other income
therefrom, and as against Landlord's business of leasing the Premises. The term
"real property taxes" shall also include any tax, fee, levy, assessment or
charge, in substitution, partially or totally, of any tax, fee, levy, assessment
or charge hereinabove included within the definition of "real property taxes".
The term "real property taxes" shall also include any and all assessments for
services generally provided without charge to owners and/or occupants of real
property prior to the adoption of Proposition 13 by the voters of the State of
California in the June 1978 election. Without limiting the generality of the
foregoing, Tenant shall be responsible for, and the term "real property taxes"
shall include, any increase in real property taxes which is caused due to (I)
any "change in ownership" of the Premises or any portion of the real property of
which the Premises constitute a part (as defined in Sections 60-69 of the
California Revenue and Taxation Code, the regulations promulgated thereunder and
any amendments or successor statutes or regulations thereto) or (ii) any
construction or work of improvement in the Premises or the Shopping Center. All
assessments (excluding those relating specifically to the Tenant Improvements on
the Premises) shall be paid in full by Landlord on or before the Commencement
Date (or, if any such assessments may be paid in installments without penalty
and 

                                       12
<PAGE>


without additional cost to Tenant, Landlord may pay them as and when they become
due). Landlord shall take no action to convert the off-site improvement costs
incurred for the Shopping Center (or any such future costs) to assessments.

                                   ARTICLE 13
                             MAINTENANCE AND REPAIR

         13.1 Obligations of Landlord. Subject to Article 4 hereof and except as
set forth as a Tenant obligation under Paragraph 13.2, below, Landlord agrees to
maintain the Common Areas in good order, condition and repair, except those
portions of the Common Areas which the Tenant is obligated to maintain pursuant
to Paragraph 13.2 hereof. Landlord shall not be responsible for any maintenance,
repairs, replacements or improvements of any kind to the Premises, except as may
be expressly set out elsewhere in the Lease. If the Common Areas or any other
portion of the Shopping Center is damaged or destroyed, either partially or
totally, Tenant shall continue the operation of its business in the Premises to
the extent practicable from the standpoint of good business and, in the event
Landlord is required or elects to make any repairs, reconstruction or
restoration of any damage or destruction to the Common Areas, Tenant shall not
be entitled to any damages by reason of any inconvenience or loss sustained by
Tenant as a result thereof, nor shall the Rent and other charges due hereunder
be abated. Damaged or destruction to the Shopping Center (whether or not
affecting the Premises) shall not entitle Tenant to terminate its Lease, under
any circumstances unless as a consequence of such damage and destruction the
parking required for Tenant's customers and/or the access to the Shopping Center
for pedestrian and vehicular traffic (necessary for the operation of Tenant's
business) has been materially and adversely impaired, and Landlord has failed to
cure or remedy such deficiencies substantially within one (1) year after written
notice from Tenant of its intent to cancel this Lease.

         13.2 Tenants Obligation to Maintain and Repair Premises. Tenant shall
keep in good order, condition and repair, the building and all of the other
improvements constituting the Premises, structural and non-structural (whether
or not such portion of the Premises requiring repair, or the means of repairing
the same, are reasonably or readily accessible to Tenant, and whether or not the
need for such repairs occurs as a result of Tenant's use, any prior use, the
elements or the age of such portion of the Premises) including, without limiting
the generality of the foregoing, all plumbing, heating, air conditioning,
ventilating, electrical, lighting, facilities and equipment within the Premises,
fixtures, walls (both interior and exterior), foundations, ceiling, roofs (both
interior and exterior), floors, windows, doors, plate glass and skylights
located within or upon the Premises, and all landscaping, driveways, parking
lots, fences, and signs, if any, located on the Premises and on the sidewalks
and parkways immediately adjacent to the same. Tenant waives and releases any
right it may have to make repairs at Landlord's expense or to quit the Premises
under Sections 1941, 1942(a) and 1932(l) of the California Civil Code. If Tenant
fails to perform Tenant's maintenance and repair obligations as set forth above
or under any other paragraph of this Lease, Landlord may at its option (but
shall not be required to) enter upon the Premises after fifteen (15) days' prior
written notice to Tenant (except in the case of an emergency, in which case no
notice shall be required) perform such obligations on Tenant's behalf and put
the same in good order, condition and repair, and the cost thereof together with
interest at the Lease Rate (as defined in Paragraph 22.11, below) shall become
due and payable as Additional Rent to Landlord together with the Tenant's next
installment of Fixed Rent. It is clearly intended by the parties hereto that
Landlord have no obligation, in any manner whatsoever, to repair or maintain the
Premises or the equipment therein, whether structural or non-structural; all of
which obligations are intended to be assumed and performed solely by Tenant and
at Tenant's sole cost and expense. Tenant expressly waives the benefit of any
statute now or hereafter in effect which would otherwise afford Tenant the right
to make repairs at Landlord's expense or to terminate this lease because of
Landlord's failure to keep the Premises in good order, condition and repair.

         13.3 Tenant's Obligation to Pay for Maintenance and Repairs to Areas
other than the Premises. Tenant, in all cases, shall also have the obligation
hereunder for the cost of maintenance and the cost of repairing any damage
caused by Tenant, its employees, agents, invitees, contractors, and customers to
those portions of the Shopping Center other than the Premises, such costs to be
paid as part of Additional Rent, except to the extent that the cost of
restoration is recovered from the proceeds of the property insurance carried by
Landlord pursuant to Paragraph 16.3.

         13.4 Common Areas. Tenant acknowledges that the Premises and each Lot
in the Shopping Center contain portions of the Common Areas, as shown on Exhibit
"A-2," which Common Areas shall be maintained by Landlord in accordance with
Paragraph 13.1. Tenant is prohibited from making any alterations, additions, or
improvements to any Common Areas, including the landscaping, located on its Lot.
Landlord's costs to maintain the Common Areas located on each Lot shall
constitute Common Areas Operating Costs of which Tenant will pay its
Proportionate Share in accordance with Paragraph 4.2.




                                      13

<PAGE>

                                   ARTICLE 14
                              ENTRY AND INSPECTION

     Tenant will permit Landlord, its employees, partners, directors, officers,
representatives, agents and affiliates, at all reasonable times during normal
business hours and at any time in case of emergency, (i) to enter into and upon
the Premises for the purpose of inspecting the same, or for the purpose of
protecting the interest therein of Landlord and Master Landlord, or to post
notices of nonresponsibility; and (ii) to take all required materials and
equipment into the premises, and perform all required work therein, including
the erection of scaffolding, props or other mechanical devices, for the purpose
of making alterations, repairs or additions to the Premises (after the failure
or refusal of Tenant to cure a default) or to any portion of the Common Areas or
for maintaining any service provided by Landlord to Tenant hereunder, without
any payment, rebate or abatement of Rent to Tenant (although Landlord is under
no obligation to make such alterations, repairs or additions to the Premises or
to maintain or provide any services to the Premises, except to the extent
provided elsewhere in this Lease). Tenant shall also permit Landlord and Master
Landlord and their respective employees, partners, directors, officers,
representatives, agents and affiliates, upon request, to enter and/or pass
through the Premises or any part thereof, at reasonable times during normal
business hours, to show the Premises to prospective purchasers, mortgagees or
master or ground lessors of the Shopping Center or any portion thereof.
Landlord, Master Landlord, and their respective employees, partners, directors,
officers, representatives, agents and affiliates shall have no liability to
Tenant for any disturbance to Tenant (and Tenant shall have no right to abate
Rent) as a consequence of Landlord's exercise of its rights hereunder.

                                   ARTICLE 15
                           WAIVER AND INDEMNIFICATION

         15.1 Waiver. From and after the Commencement Date or the date Landlord
gives Tenant possession of the Premises, whichever first occurs, Tenant, as a
material part of the consideration to Landlord, hereby assumes all risk of
damage to Tenant's property or injury to Tenant's employees, agents, visitors,
invitees and licensees anywhere in the Shopping Center, including the Premises,
and Tenant hereby waives all claims in respect thereof from any cause whatsoever
against Landlord, its agents or employees, except claims for personal injury or
property damage not covered by the insurance required to be carried by Tenant
pursuant to Paragraph 16.1 (and only to the extent covered by the liability
insurance carried by Landlord pursuant to Paragraph 16.3) which are caused by
the failure of Landlord to observe any of the terms and conditions of this Lease
(and such failure persists for an unreasonable period of time after written
notice of such failure) or which arise from any neglect, fault or omission of
Landlord, or of its agents or employees. Landlord shall not be liable to Tenant
for any unauthorized or criminal entry of third parties into the Premises or the
Shopping Center, or for any damage to persons or property, or loss of property
in or about the premises or the Shopping Center, the parking lot and the
approaches, loading docks, entrances, streets, sidewalks or corridors thereto,
by or from any unauthorized or criminal acts of third parties, regardless of any
breakdown, malfunction or insufficiency of any security measures, practices or
equipment that may be provided by Landlord. Tenant shall immediately notify
Landlord in writing of any breakdown or malfunction of any security measures,
practices or equipment provided by Landlord as to which Tenant has or should
have knowledge. Landlord shall not be liable to Tenant for interference with
light or incorporeal hereditaments or for damage therefrom to Tenant or Tenant's
Agents or to Tenant's property from any cause beyond Landlord's reasonable
control. Tenant hereby agrees that in no event shall Landlord be liable for
consequential damages, including injury to Tenant's business or any loss of
income therefrom, nor shall Landlord be liable to Tenant for any damages caused
by the act or neglect of any other tenant or their invitees in the Shopping
Center.

         15.2 Indemnifications.

         (a) Tenant's Indemnification of Landlord. From and after the
Commencement Date or the date Landlord gives Tenant possession of the premises,
whichever first occurs, Tenant hereby agrees to indemnify, defend and hold
Landlord harmless against and from any and all claims for damages or injury
occurring on the premises, or in connection with the conduct of its business on
the premises, or from any activity, work, or other thing permitted or suffered
by Tenant on the Premises, and shall further indemnify, defend and hold Landlord
harmless against and from any and all claims arising from any breach or default
in the performance of any obligation on Tenant's part to be performed under the
terms of this Lease, or arising from any act, neglect, fault, or omission of
Tenant, or of its agents, employees, visitors, invitees, and licensees occurring
on the Premises or any part or portion of the Shopping Center, and from and
against all reasonable costs, attorneys' fees, expenses, and liabilities
incurred in connection with any such claims or any actions or proceedings
brought thereon; and in case any action or proceeding be brought against
Landlord by reason of such claim, Tenant, upon notice from Landlord, shall
defend the same at Tenant's expense by counsel reasonably satisfactory to
Landlord. When the claim is caused by the joint negligence or willful misconduct
of Landlord and Tenant or Tenant and a third party unrelated to Tenant (except
Tenant's agents or employees), Tenant's duty to indemnify and save harmless
Landlord shall be in proportion to Tenant's allocable share of the joint
negligence or willful misconduct.

                                       

                                       14

<PAGE>


         (b) Landlord's Indemnification of Tenant. From and after the
Commencement Date or the date Landlord gives Tenant possession of the Premises,
whichever first occurs, Landlord shall indemnify and save harmless Tenant from
and against any and all suits, liabilities, obligations, damages, penalties,
claims, costs, charges, and expenses, including reasonable attorneys' fees, from
third parties which may be imposed upon or incurred by or asserted against
Tenant (i) as a result of or arising out of Landlord's failure to perform any
covenant or agreement required to be performed by Landlord under this Lease,
(ii) caused by the negligence or willful misconduct of Landlord, its agents and
employees, or (iii) in connection with the Landlord's performance of its Site
preparation work and Site Improvements work under Exhibit "C" hereto. When the
claim is caused by the joint negligence or willful misconduct of Landlord and
Tenant or Landlord and a third party unrelated to Landlord (except Landlord's
agents or employees), Landlord's duty to indemnify and save harmless Tenant
shall be in proportion to Landlord's allocable share of the joint negligence or
willful misconduct.

         15.3 Survival. The provisions of this Article 15 shall survive the
expiration or sooner termination of this Lease. 

                                   ARTICLE 16
                                   INSURANCE

         16.1 Insurance to be Provided by Tenant. From and after the
Commencement Date or the date Landlord gives Tenant possession of the Premises,
whichever first occurs, and continuing thereafter until the expiration or sooner
termination of the term hereof (or the date on which Tenant has completely
vacated the Premises, if that occurs subsequent to the expiration or termination
of the term), Tenant shall carry and maintain, at its sole cost and expense, the
following types of insurance (affording primary coverage) in the amounts
specified and in the form hereinafter provided for:

            (a) Property damage insurance covering (i) the Premises, including
all improvements as may be made by Tenant pursuant to Exhibit "C" and Article 10
hereof, and (ii) Tenant's Property, including all trade fixtures, inventory,
merchandise and other personal property from time to time in the Premises, both
in amounts not less than one hundred percent (100%) of their replacement cost
valuation from time to time during the term of this Lease (with a value
endorsement deleting any coinsurance provisions), providing "all risk coverage"
(also known as "special causes of loss"), including sprinkler leakage and plate
glass coverage and coverage for flood and earthquake. Unless this Lease is
terminated pursuant to Paragraph 19.2, the proceeds of such insurance shall be
used for the repair or replacement of the property so insured, and any
deficiency (whether due to inadequacy of coverage, a deductible, or otherwise)
shall be paid for by Tenant. Following a casualty (and regardless of whether or
not this Lease is terminated pursuant to Paragraph 19.2), the proceeds under (i)
above shall be paid to Landlord and Landlord's lenders, as their respective
interests may appear, and the proceeds under (ii) above shall be paid to Tenant.
Except in the event this Lease is terminated under Paragraph 19.2, the proceeds
so paid to Landlord (or Landlord's lenders) shall be made available to Tenant
for payment of the costs and expenses of repair incurred by Tenant; provided,
however, that such proceeds shall be allocated to Tenant subject to reasonable
conditions including, but not limited to, an architect's certification of costs,
retention of a percentage of such proceeds pending recordation of a notice of
completion, and other customary builder's disbursement controls, all at the sole
expense of Tenant. In the event that the insurance proceeds are insufficient to
cover the cost of repair, then any amounts required over the amount of the
insurance proceeds received necessary to complete said repair shall be paid by
Tenant prior to the release of any insurance proceeds.

            (b) Business automobile liability insurance, or equivalent form,
with a combined single limit of not less than Five Million Dollars ($5,000,000)
per occurrence. Such insurance shall include coverage for owned, non-owned and
hired automobiles.

            (c) Commercial or comprehensive general liability insurance
(including bodily injury and property damage) in an amount of not less than a
combined single limit of Five Million Dollars ($5,000,000), insuring against any
and all liability of the insured with respect to the Premises and the Shopping
Center arising out of the use or occupancy thereof (including the construction
of improvements on the Premises or any portion thereof), and under which the
insurer agrees to cover and protect Tenant and all additional insured parties
from and against all costs, expenses and/or liability arising out of or based
upon Tenant's indemnification obligations pursuant to Paragraph 15.2 of this
Lease.

            (d) Liquor liability; if this Lease covers premises in which
alcoholic beverages are sold and/or consumed, Tenant's liability insurance shall
not exclude liability for violation of any governmental statute, ordinance,
regulation or rule pertaining to the sale, gift, distribution or use of any
alcoholic beverages, or liability by reason of the selling, serving, or giving
of any alcoholic beverages to a minor or to a person under the influence of
alcohol, or which causes or contributes to the intoxication of any persons.
Accordingly, the indemnification obligations of Tenant under Paragraph 15.2
shall extend, as well, to damage occurring elsewhere than in, on or upon the
Premises, resulting from risks insurable by so-called dram shop liability
insurance.

                                       15

<PAGE>

            (e) Workers' compensation as required by law and employer's
liability insurance for at least One Million Dollars ($1,000,000) in coverage.

            (f) Business interruption insurance covering loss of income and
extra expense in such amounts as will reimburse Tenant for direct or indirect
loss of earnings, income and extra expense for at least one (1) year
attributable to all perils commonly insured against by prudent tenants, or
attributable to the inaccessibility of or to the Premises or the Shopping Center
as a result of such perils, or otherwise, preferably by the same insurance
carrier that issues Tenant's property insurance.

            (g) Intentionally Omitted.

            (h) Any other form of insurance for risks and/or perils against
which a prudent tenant would customarily protect itself (and/or increases in the
amounts of coverage under any or all of the liability insurance policies
hereinabove required to be carried by Tenant) in such form and amounts as
Landlord or Landlord's lender may reasonably require from time to time.

         Tenant's insurance coverage under this Paragraph 16.1 may be subject to
a commercially reasonable deductible (which deductible shall not exceed $50,000
without Tenant's having first obtained Landlord's prior written consent).

         16.2 Evidence of Insurance. Tenant shall furnish properly executed
policies or certificates of insurance to Landlord prior to Tenant's occupancy.
Such policies or certificates shall clearly evidence all coverage required of
Tenant, shall have commercially reasonable deductibles, and shall provide that
such insurance shall not be materially changed, terminated or allowed to expire
except after thirty (30) days prior written notice to Landlord. All policies
required hereunder (except as described in Subparagraph 16.1(e), above) shall
name Landlord, Landlord's lenders, and the Master Landlord as additional
insureds and the certificate thereof shall evidence such coverage. Certificates
of insurance shall be replaced with new binders or certificates prior to the
termination of any policy of insurance required of Tenant. In Landlord's
discretion, Landlord may request complete copies of Tenant insurance policies in
lieu of such certificates. Tenant shall have the right to provide such insurance
coverage pursuant to blanket policies obtained by Tenant; provided such blanket
policies expressly afford coverage to the Premises and to Tenant as, in
Landlord's opinion, is required by this Lease. All policies required by this
Paragraph 16 shall be issued by insurers qualified to do business in the State
of California, whose financial strength is reasonably acceptable to Landlord,
and in form satisfactory to Landlord, from time to time.

         16.3 Landlord's Insurance. During the term of this lease, Landlord
shall maintain in effect such policies of insurance as are at least in such
amounts (and are subject to no larger deductibles) as are customarily carried by
landlords in similar shopping centers in the State of California; the premiums
and deductibles for commercial or comprehensive general liability insurance
covering the Common Areas shall be included in Common Areas Operating Costs.

         16.4 Maintenance of Insurance. If Landlord, for any reason, fails to
maintain insurance coverage which is required pursuant to this Lease, the same
shall be deemed a material default and breach of this lease. Landlord, at its
sole option, may immediately terminate this Lease and obtain damages from Tenant
resulting from said breach. Election by Landlord not to terminate this Lease
shall not be deemed a waiver by Landlord of Tenant's breach, nor of any of
Landlord's rights and remedies pursuant to the terms of this Lease. Landlord may
(but is under no obligation to do so) at any time and from time to time, and
without notice, procure such insurance and pay the premiums therefor, in which
event Tenant shall, within ten (10) days after demand therefor, reimburse
Landlord for all amounts paid and costs and expenses incurred by Landlord to
procure and pay for such insurance, plus interest on such amounts at the Lease
Rate (as defined in Paragraph 22.11). Tenant shall not stock, use or sell any
article of merchandise that would increase insurance rates and premiums on the
Shopping Center, or on any of the individual improvements in the Shopping Center
other than the Premises.

         16.5 Waiver of Subrogation. Any policy or policies of property
insurance which either party obtains in connection with the Premises, shall
include a clause or endorsement denying the insurer any rights of subrogation
against the other party to the extent rights have been waived by the insured
prior to the occurrence of injury or loss. Landlord and Tenant waive any rights
against the other for injury or loss due to hazards covered by such insurance,
whether or not containing such a waiver of subrogation clause or endorsement, to
the extent of the loss covered thereby, or if either party does not, for any
reason, have valid enforceable insurance, then, this waiver shall apply to the
extent of all property insurance which was required to be carried hereunder.


                                       16

<PAGE>

                                   ARTICLE 17
                           ASSIGNMENT AND SUBLETTING

         17.1 General Limitations. Except as expressly provided in Paragraphs
17.3 and 17.4 of this Article, without Landlord's written consent first had and
obtained, Tenant (including without limitation any subsequent assignee or
subtenant) shall not either voluntarily or by operation of law, assign,
mortgage, hypothecate or encumber this Lease, or any interest in this lease,
permit the use of the Premises by any person or persons, franchises, affiliated
companies, licensees or concessionaires, other than Tenant, or sublet the
Premises or any part of the Premises. Any transfer of this Lease form Tenant by
merger, reorganization, liquidation, or the sale, conveyance, transfer by
bequest or inheritance, or other transfer of a controlling interest in Tenant
(whether by transfer of stock, partnership interest or otherwise) shall
constitute an assignment for the purposes of this lease. Notwithstanding the
foregoing, if Tenant is a corporation whose stock is regularly traded on a
national stock exchange, or is regularly traded in the over-the-counter market
and quoted on NASDAQ, the transfer of stock, regardless of quantity, shall not
constitute an assignment for the purposes of this lease. A consent to one
assignment, subletting, occupation or use shall not constitute a waiver of the
necessity of such consent to a subsequent assignment or subletting, whether by
Tenant or any subsequent assignee or subtenant. Tenant shall not be released
from liability for the full performance of all the terms, conditions and
covenants of this Lease on Tenant's part to be performed, whether occurring
before or after such consent, assignment or subletting. Any requests for consent
to a sublease or assignment hereunder shall be accompanied by a check payable to
Landlord in the sum of Two Hundred Fifty Dollars ($250) as a charge for the
processing of such documents. In addition, Tenant shall reimburse Landlord its
actual costs and expenses for attorneys' fees incurred in connection with any
proposed sublease or assignment. If so requested by Landlord, Tenant shall
deposit with Landlord the Landlord's estimate of such legal fees prior to the
commencement by Landlord of any review of the proposed request for consent.

         17.2 No Unreasonable Withholding of Consent. Landlord shall not
unreasonably withhold its consent to an assignment or subletting for the same
use as provided in Paragraph 10 of the Lease Summary, notwithstanding anything
in this Article 17 to the contrary. The foregoing is not intended to imply any
waiver of Landlord's reservation of the absolute right to (a) disapprove
assignments or subleases for uses that differ in any material respect from the
use expressly permitted in Paragraph 10 of the Lease Summary or that violate the
standards set forth in Paragraph 8.1, or (b) terminate this Lease in accordance
with Paragraph 8.4. In determining whether or not to consent to the proposed
assignment or subleasing, Landlord may consider, among other factors, the
experience of the proposed sublessee or assignee in operating a business in a
shopping center for the use set forth in Paragraph 10 of the Lease Summary,
whether or not any exclusives granted by Landlord will be impacted, and whether
the proposed sublessee or assignee is financially sound and has a net worth that
is adequate in the circumstances. Landlord shall be deemed to be reasonable in
refusing consent if such refusal is based upon a violation of any exclusive
granted by Landlord. If Tenant does assign or sublease all or any portion of the
Premises on a basis such that the value of the consideration for same to be
received by Tenant will exceed the Rent or prorated portion thereof, as the case
may be, for such space reserved in this Lease, Tenant shall pay to Landlord when
received, as Additional Rent, at the same time as the monthly installments of
Rent are due hereunder, fifty percent (50%) of the excess of the Rent and all
other consideration paid in connection with or pursuant to the assignment or
sublease, over the Rent as reserved in this Lease applicable to the assigned or
subleased space. Notwithstanding the foregoing, Landlord's right to share in
"all other consideration" shall not, when added to Landlord's share of the
excess Rent, exceed fifty percent (50%) of the difference between the then fair
market rental for the Premises (or a prorated portion thereof) and the Rent for
such space reserved in this Lease. The acceptance of Rent by Landlord from any
other person shall not be construed as a waiver by Landlord of any provision of
this Lease, or as a waiver of the requirement of Landlord's consent to any
assignment, subletting or other transfer, or to be a release of Tenant from any
obligation under this Lease. Each assignee or subtenant shall jointly assume all
obligations of the Tenant under this Lease, and shall be and remain liable
jointly and severally with Tenant for the payment of Rent, and for the due
performance of all the terms, covenants and conditions and agreements herein
contained on Tenant's part to be performed during the Lease term; provided,
however, that a subtenant shall be liable to Landlord for Rent only in the
amount set forth in the sublease. Whether or not Landlord's consent is required,
no assignment shall be effective or binding on Landlord unless such assignee or
sublessee shall deliver to Landlord a counterpart of such assignment or sublease
(and any related collateral agreements) and an instrument in recordable form
which contains a covenant of assumption by the assignee or sublessee
satisfactory in substance and form to Landlord, consistent with the above
requirements. The failure or refusal of the assignee or sublessee to execute
such an instrument of assumption shall not waive, release or discharge the
assignee or sublessee from its liability.

         17.3 Reorganizations and Mergers. Tenant shall be entitled to assign
and transfer this Lease to the surviving corporation in the event of a merger or
a sale of assets transaction to which Tenant shall be a party; provided,
however, that such subsidiary, affiliated firm or surviving corporation shall in
writing expressly assume all of the provisions, covenants and conditions of this
Lease on the part of Tenant to be kept and performed; and provided, further
(unless Tenant shall thereafter cease to exist) that no such assignment or
transfer shall act as a release of Tenant from any of the provisions, covenants
and conditions of this Lease on 


                                       17

<PAGE>

the part of Tenant to be kept and performed. This Paragraph 17.3 shall not apply
in the event of a sale of less than substantially all (meaning, for purposes of
this Paragraph 17.3, less than 75%) of the assets of Tenant.

         17.4 Assignment as a Result of Tenant's Bankruptcy.

            (a) In the event this Lease is assigned to any person or entity
pursuant to provisions of the United States Bankruptcy Code, 11 U.S.C. Section
101 et seq. (the "Bankruptcy Code"), any and all monies or other consideration
payable or otherwise to be delivered in connection with such assignment shall be
paid or delivered to Landlord, shall remain the exclusive property of Landlord,
and shall not constitute property of Tenant or of the estate of Tenant within
the meaning of the Bankruptcy Code. Any and all monies or other consideration
constituting Landlord's property under the preceding sentence not paid or
delivered to Landlord shall be held in trust for the benefit of Landlord and be
promptly paid to or turned over to Landlord.

            (b) If Tenant, pursuant to this Lease, proposes to assign the same
pursuant to the provisions of the Bankruptcy Code, to any person or entity who
shall have made a bona fide offer to accept an assignment of this Lease on terms
acceptable to Tenant, then, notice of the proposed assignment setting forth (i)
the name and address of such person, (ii) all of the terms and conditions of
such offer, and (iii) the assurances referred to in Section 365(b)(3) of the
Bankruptcy Code, shall be given to the Landlord by the Tenant no later than
twenty (20) days after receipt of such offer by the Tenant, but in any event no
later than ten (10) days prior to the date that Tenant shall make application to
a court of competent jurisdiction for authority and approval to enter into such
assignment and assumption, and Landlord shall thereupon have the prior right and
option, to be exercised by notice to the Tenant given at any time prior to the
effective date of such proposed assignment, to accept an assignment of this
Lease upon the same terms and conditions and for the same consideration, if any,
as the bona fide offer made by such person, less any brokerage commissions which
may be payable out of the consideration to be paid such person for the
assignment of this Lease.

            (c) Any person or entity to which this Lease is assigned pursuant to
the provisions of the Bankruptcy Code shall be deemed without further act or
deed to have assumed all of the obligations arising under this Lease on or after
the date of such assignment. Any such assignee shall, upon demand, execute and
deliver to Landlord an instrument confirming such assumption.

            (d) The following factors may be considered by the Landlord as
necessary in order to determine whether or not the proposed assignee has
furnished Landlord with adequate assurances of its ability to perform the
obligations of this Lease:

            1. The adequacy of a security deposit.

            2. Net worth and other financial elements of the proposed assignee;
and

            3. Demonstration that assumption or assignment will not disrupt
substantially the tenant mix or balance in the Shopping Center.

            (e) It is hereby acknowledged that this is a "shopping center lease"
within the meaning of Section 365(b)(3) of the Bankruptcy Code.

            (f) In the event Landlord rejects the proposed assignee, the rights
and obligations of the parties hereto shall continue to be governed by the terms
of this Lease, and Tenant shall have all the rights of Tenant under applicable
California law.

         17.5 Effect of Violation. Except as may be expressly permitted without
Landlord's consent elsewhere in this Lease, any assignment, mortgage, pledge,
hypothecation, encumbrance, subletting or license of this Lease, the leasehold
estate hereby created, or the Premises or any portion thereof, either
voluntarily or involuntarily, whether by operation of law or otherwise, or any
other action by Tenant in violation of the restrictions set forth in this
Article 17, without the prior written consent of Landlord first had and obtained
therefor, shall be null and void and shall, at the option of Tenant, constitute
a material default under this Lease.

         17.6 No Release. Tenant is not and shall not be released from liability
for the full and complete performance of the terms, conditions, and covenants of
this Lease upon any assignment, sublease, or other transfer, regardless of
whether or not Landlord's consent was first required.

                                   ARTICLE 18
                         TRANSFER OF LANDLORD'S INTEREST

         In the event of any transfer or transfers of Landlord's interest in the
Premises or in the Shopping Center, other than a transfer for security purposes
only, the transferor shall automatically be relieved of, and Tenant shall
release such transferor from, any and all obligations and liabilities on the
part of Landlord 


                                       18

<PAGE>

accruing from and after the date of such transfer, including without limitation
the obligation of Landlord under Article 6 hereof to return the Deposit as
provided therein; provided, with respect to security deposits, that the
transferor transfers to or appropriately credits the transferee for the Deposit.

                                   ARTICLE 19
                             DAMAGE OR DESTRUCTION

         19.1 Obligation to Rebuild. Should any or all of the improvements on
the Premises be damaged or destroyed, partially or totally, from any cause
covered (or required to be covered) by any insurance required to be maintained
under Paragraph 16.1 hereof, or if the Premises are damaged from a cause not
required to be covered by insurance under Paragraph 16.1 and the cost of repair
or restoration is less than twenty-five percent (25%) of the then-replacement
value, then Tenant shall repair, restore and rebuild said improvements on the
Premises to at least the condition existing immediately prior to such damage or
destruction, and this Lease shall remain in full force and effect. Such repair,
restoration and rebuilding (all of which are herein called "repair") shall be
commenced promptly after such damage or destruction has occurred and shall be
diligently pursued to completion. Without limiting Landlord's other available
remedies, Tenant's failure to rebuild, replace or use the Premises for
commercial purposes shall give Landlord a right to recapture the Lease as
provided in Paragraph 8.4.

         19.2 Last Two Years. If the Premises are damaged or destroyed, either
partially or totally, during the last two (2) years of the term of this Lease,
Landlord and Tenant shall each have the right to cancel and terminate this Lease
as of the date of occurrence of such damage by giving written notice to the
other of its election to do so within thirty (30) days after the date on which
such damage occurred. Notwithstanding the foregoing, should Tenant have the
right to extend the term pursuant to Paragraph 2.7, above, Tenant shall have the
right to exercise its next option right for a period of ten (10) days after
receipt of Landlord's written notice to cancel and terminate this Lease as a
consequence of such damage or destruction near the end of the term. If Tenant so
exercises its option to extend the term, Landlord's purported cancellation and
termination of this Lease shall be deemed null and void; provided, however, that
Tenant shall promptly proceed with the repair, restoration and rebuilding of the
Premises in accordance with Paragraph 19.1 at Tenant's expense, whereupon this
Lease shall continue in full force and effect. If Tenant fails to exercise its
said option during said ten (10) day period, then this Lease shall be deemed
canceled and terminated in accordance with Landlord's said notice.

         19.3 Effect of Termination. In the event this Lease is terminated under
the provisions of Paragraph 19.2, such termination shall become effective at the
time and in accordance with the respective provisions herein contained for the
termination of this Lease; provided, however, that all Rent and other charges on
the part of Tenant to be paid hereunder shall be prorated and paid either as of
the date of such damage or destruction, or as of the date Tenant ceases doing
business in, upon or from the Premises, whichever last occurs. Tenant shall have
no claim to the proceeds of property damage insurance, except to the extent of
any unamortized construction costs of the Building which were paid by Tenant at
its own expense pursuant to Exhibit "C."

         19.4 Uninsured Casualty. Should any or all of the improvements on the
Premises be damaged or destroyed from any cause not covered (or required to be
covered) by insurance required to be maintained under Paragraph 16.1 hereof in
excess of twenty-five percent (25%) of its then-replacement value, then Tenant
shall have the option to either

            (a) repair, restore and rebuild said improvements on the Premises to
at least the condition existing immediately prior to such damage or destruction
per the terms and conditions of Paragraph 19.1, above, or

            (b) demolish and remove the improvements and hydroseed the pad so
that it is visually harmonious with the remainder of the Shopping Center.

         In the event of such an uninsured casualty so that Tenant has the
option under Subparagraphs 19.4(a) and (b), above, following its exercise of
such option Tenant may assign or sublet the Premises in accordance with
Paragraph 17.2, above, and unless and until Tenant re-opens under the use set
forth in Paragraph 10 of the Lease Summary, Tenant may assign or sublet the
Premises under Paragraph 17.2 without being limited to the use set forth in
Paragraph 10 of the Lease Summary (notwithstanding anything to the contrary in
Paragraph 17.2); provided, however, that such other use may not be in conflict
with the Declaration, any then-existing uses at the Shopping Center, or with any
exclusives granted for the Shopping Center.

         19.5 No Abatement of Rent. Notwithstanding the partial or total
destruction of the Premises or any part thereof, and notwithstanding whether or
not the casualty is insured, there shall be no abatement of Rent or any other
obligation of Tenant hereunder by reason of such damage or destruction (unless
Landlord recaptures the Premises as permitted under Paragraph 19.1). 

                                       19

<PAGE>

                                   ARTICLE 20
                                 EMINENT DOMAIN

         20.1 Termination. If the whole of the Premises shall be taken under
power of eminent domain (or by deed in lieu of condemnation), this Lease shall
automatically terminate. If any portion of the total square footage of the
Premises is so taken under the power of eminent domain (or by deed in lieu of
condemnation), and such partial taking reasonably may be construed to render the
remainder of the Premises unsuitable for Tenant's business, this Lease may be
terminated by Tenant by written notice given within thirty (30) days after such
taking, in either case such termination to be effective as of the date
possession is taken by the condemning authority. No award for any partial or
entire taking shall be apportioned, and Tenant hereby assigns to Landlord any
award which may be made in such taking or condemnation, together with any and
all rights of Tenant now or hereafter arising in or to the same or any part
thereof, except to the extent of any unamortized construction costs of the
Building which were paid by Tenant at its own expense pursuant to Exhibit "C";
provided, however, that nothing contained herein shall be deemed to give
Landlord any interest in or to require Tenant to assign to Landlord any award
specifically made to Tenant for goodwill and relocation benefits. Any liability
of Tenant to Landlord having already accrued under this Lease shall survive its
early termination, as aforesaid.

         20.2 Partial Taking. In the event of a partial taking of the Premises
under the power of eminent domain (or by deed in lieu of condemnation) which
does not result in a termination of this Lease, if such taking materially and
adversely impacts access to or from or visibility of the Premises, the Fixed
Rent shall be equitably adjusted to reflect any diminution in business revenue
incurred by Tenant as a direct result of the partial taking. Landlord and Tenant
hereby waive the provisions of Code of Civil Procedure Section 1265.130 allowing
either party to petition the Superior Court, or any right either may have, to
terminate this Lease in the event of a partial taking of the Premises.

         20.3 Temporary Taking. No temporary taking of the Premises and/or of
Tenant's rights therein or under this Lease shall terminate this Lease or give
Tenant any right to any abatement of Rent hereunder. Any award made to Tenant by
reason of any such temporary taking shall belong entirely to Tenant, and
Landlord shall not be entitled to share therein.

         20.4 Taking of Common Areas.

            (a) If any part of the Common Areas is taken by condemnation, this
Lease shall remain in full force and effect, except that if twenty-five percent
(25%) or more of the parking in the Common Areas required for Tenant's customers
is taken by condemnation, either party shall have the right to terminate this
Lease pursuant to this paragraph. If a party elects to terminate this Lease, it
must terminate pursuant to this paragraph by giving notice to the other party
within thirty (30) days after the nature and the extent of the taking have been
finally determined. The party terminating this Lease also shall notify the other
party of the date of termination, which date shall not be earlier than thirty
(30) days or later than ninety (90) days after the terminating party has
notified the other party of its election to terminate; except that this lease
shall terminate on the date of taking if the date of taking falls on a date
before the date of termination designated in the notice from the terminating
party. Any liability of Tenant to Landlord having already accrued under this
Lease shall survive its early termination, as aforesaid. If this Lease is not
terminated within the thirty-day period, it shall continue in full force and
effect.

            (b) Except as provided in Paragraph 20.2, unless this Lease is
terminated pursuant to the terms hereof, there shall be no abatement of Rent as
a result of any taking under the power of eminent domain.

                                ARTICLE 21
                            SIGNS AND AUCTIONS

         21.1 Signage. Provided Tenant complies with the City of Westminster's
conditions of approval, the Declaration and the Lease, Tenant may have its sign
"can" placed on each side of the pylon sign for the Shopping Center. Tenant's
position on the pylon shall be immediately below the panel for the tenant
occupying "Major A" on the Site Plan and Tenant's sign "can" shall be of a size
based upon the relative square footage of the Premises compared to the square
footage of the "Major A" tenant's premises. As provided in Article 4, Tenant
shall pay its proportionate share of the cost of construction, installation,
operation, maintenance and repair of the pylon sign; Tenant's proportionate
share is the ratio, stated as a percentage, which the number of square feet in
Tenant's panel bears to the total number of square feet of all panel area in the
pylon sign, and is subject to adjustment. Except as set forth in Tenant's plans
and specifications for the Building approved by Landlord pursuant to Exhibit
"C," Tenant shall not place or suffer to be placed on the exterior of the
Premises or any exterior door or wall or the exterior or interior of any window
of the Premises any sign, awning, canopy, grates or other security devices,
marquee, advertising matter, decoration, lettering or other thing of any kind
without the prior written consent of Landlord, which consent shall not
unreasonably be withheld or delayed. Any exterior signage so approved by
Landlord shall be in accordance with the Declaration and sign criteria as set
forth in Exhibit "C" hereto, and shall be installed, maintained and repaired 



                                       20

<PAGE>

at Tenant's sole cost and expense. Landlord hereby reserves the exclusive right
to the use of the roofs and the exterior of the walls of the rest of the
Shopping Center. Except as otherwise herein provided, Tenant shall have the
right, at its sole cost and expense, to erect and maintain within the interior
of the Premises all signs and advertising matter customary or appropriate in the
conduct of Tenant's business which cannot be seen from the exterior of the
Premises. In this connection, Tenant acknowledges that the Premises are a part
of a shopping center, and agrees that control of all signs and exterior
appearance by Landlord is essential to the maintenance of anesthetic and
commercial values in or pertaining to the Shopping Center. Tenant shall at all
times during the term of this Lease, at its sole cost and expense, keep its
window displays, signs and advertising devices adequately illuminated
continuously during such days and hours as Tenant is required to be open for
business herein and during such additional hours as Landlord may request, from
time to time. Upon expiration or earlier termination of this Lease, all signage
affixed to the exterior of the Premises or on any portion of the Shopping Center
shall be surrendered in good condition and repair unless Landlord requires
Tenant to remove same, at Tenant's expense, upon surrender of the Premises, and
Tenant shall repair at Tenant's cost any damage occasioned by such removal.

         21.2 Auction or Sale. Tenant shall not conduct or permit to be 
conducted any sale by auction in, upon or about the Premises or the Common 
Areas, whether said auction be voluntary, involuntary or pursuant to any 
assignment for the benefit of creditors, or pursuant to any bankruptcy or 
other insolvency proceeding.

                                   ARTICLE 22
                             DEFAULTS AND REMEDIES

         22.1 Default Defined. The occurrence of any of the following shall
constitute a material default and breach of this Lease by Tenant:

            (a) The failure by Tenant to pay any Rent or make any other payment
required to be made by Tenant hereunder within three (3) days after Tenant's
receipt of written notice from Landlord that any such payment is past due;
provided, however, that notwithstanding the notice prerequisite for a default
under this Subparagraph 22.1(a), Landlord shall be entitled to receive, as more
particularly set forth in Paragraph 22.11, below, a late charge and interest at
the Lease Rate on any payments not paid as and when due;

            (b) The abandonment (which is deemed to include absence from the
Premises for more than ten (10) days while in default of any material provision
of this Lease) or vacation (except to facilitate an assignment or subletting
permitted pursuant to Article 17) of all or any portion of the Premises by
Tenant;

            (c) Tenant's failure to adequately bond or cause to be released any
mechanics' liens filed against the Premises within ten (10) days after the date
same shall have been filed (unless Tenant contests such liens in accordance with
Article 11);

            (d) The failure by Tenant to observe or perform any other provision
of this Lease (including the Rules and Regulations attached hereto as Exhibit
"B" and made a part hereof) to be observed or performed by Tenant, other than
those described in Subparagraphs (a), (b) and (c) above, where such failure
continues for thirty (30) days after written notice thereof by Landlord to
Tenant; provided, however, that if the nature of such default is such that the
same cannot reasonably be cured within such thirty (30) day period, Tenant shall
not be deemed to be in default if Tenant shall within such period commence such
cure and thereafter diligently pursues the completion of same. Such thirty-day
notice shall be in lieu of and not in addition to any notice required under
Section 1161 of the California Code of Civil Procedure;

            (e) The making by Tenant or Tenant's guarantor, if any, of a general
assignment for the benefit, of creditors; the filing by or against Tenant, or
Tenant's guarantor of a petition to have Tenant or Tenant's guarantor adjudged a
bankrupt or of a petition for reorganization or arrangement under any law
relating to bankruptcy (unless, in the case of a petition filed against Tenant,
the same is dismissed within sixty (60) days); the appointment of a trustee or
receiver to take possession of substantially all of Tenant's assets located at
the Premises or of Tenant's interest in this lease, where possession is not
restored to Tenant within thirty (30) days; the attachment, execution, or other
judicial seizure of substantially all of Tenant's assets located at the Premises
or of Tenant's interest in this Lease, where such seizure is not discharged
within thirty (30) days; or the failure or admission by Tenant or Tenant's
guarantor of its inability, generally, to pay its debts as they become due;

            (f) Any attempted transfer, conveyance, assignment, hypothecation or
subletting of this Lease, or any part thereof, otherwise than as expressly
permitted hereunder; or

            (g) The failure of Tenant to timely complete and deliver to Landlord
the Estoppel Certificate required in Article 34 hereof, the Subordination and
Attornment Agreement required in Article 27 hereof, or any other documentation
required hereunder.

                                       21

<PAGE>

         22.2 Remedies; Termination. In the event of any default by Tenant
hereunder as set forth in Paragraph 22.1 hereof, and in addition to any other
remedies available to Landlord at law, in equity or elsewhere under this Lease,
all of which rights and remedies shall be cumulative, with the exercise of one
or more rights or remedies not to impair Landlord's right to exercise any other
right or remedy (and which may be exercised with or without legal process as
then may be provided or permitted by the laws of the State of California),
Landlord shall have the immediate option to terminate this Lease and all rights
of Tenant hereunder by giving Tenant written notice of such election to
terminate. In the event that Landlord shall elect to so terminate this Lease,
then Landlord may recover from Tenant:

            (a) the worth at the time of award of any unpaid Rent or other
charges 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 and other charges which would have been earned after termination until the
time of award exceeds the amount of such rental loss Tenant proves could have
been reasonably avoided; plus

            (c) the worth at the time of award of the amount by which the unpaid
Rent and other charges for the balance of the term after the time of award
exceeds the amount of such rental loss that Tenant proves could reasonably be
avoided; plus

            (d) any other amount necessary to compensate, Landlord for all the
detriment proximately caused by Tenant's failure to perform its obligation under
this Lease, or which in the ordinary course of things would be likely to result
therefrom, including attorneys fees and costs; and

            (e) at Landlord's election, such other amounts in addition to or in
lieu of the foregoing as may be permitted from time to time by applicable law.

As used in Subparagraphs (a) and (b) above, the "worth at the time of award" is
computed by allowing interest at the Lease Rate (as defined in Paragraph 22.11,
below). As used in Subparagraph (c) above, the "worth at the time of award" is
computed by discounting such amount at the discount rate of the Federal Reserve
Bank of San Francisco at the time of award plus one percent (1%). The amount
recoverable by Landlord pursuant to Subparagraph (d) above shall include, but is
not limited to, any costs or expenses incurred by Landlord in maintaining or
preserving the Premises after such default, preparing said Premises for
reletting to a new tenant, accomplishing any repairs or alterations to the
Premises for the purpose of such reletting, rectifying any damage thereto
occasioned by the act or omission of Tenant, and any other costs reasonably
necessary or appropriate to relet the Premises.

         22.3 Remedies; Re-entry. In the event of any such default by Tenant and
termination of this Lease by Landlord, Landlord shall also have the right to
re-enter the Premises and remove all persons and property from the Premises as
provided in Paragraph 23.3. Tenant hereby waives all claims for damages that may
be caused by Landlord's re-entering and taking possession of the Premises or
removing and storing the property of Tenant as provided in Paragraph 23.3.

         22.4 Remedies; Non-termination and Collection of Rent. In the event
Landlord elects not to terminate this Lease as provided in Paragraph 22.2
hereof, this Lease shall continue in full force and effect. In that event,
Landlord may enforce all of its rights and remedies hereunder and at law,
including the right to recover Rent and other charges as they come due. However,
Tenant shall continue to have the right to possession of the Premises, and
Tenant shall have the right to sublet the same with Landlord's written consent,
which consent (for the purposes of this Paragraph 22.4) shall not unreasonably
be withheld. Likewise for the abandonment by Tenant, no re-entry or taking
possession of the Premises by Landlord shall be construed as an election to
terminate this Lease, nor shall it cause a forfeiture of Rent or other charges
remaining to be paid during the balance of the term herein, unless a written
notice of such intention to terminate be given to Tenant by Landlord.

         22.5 Intentionally Omitted.

         22.6 No Effect on Indemnification Obligation. Nothing in this Article
22 shall be deemed to affect or waive Landlord's rights to indemnification for
liability or liabilities rising prior to termination of this Lease for personal
injury or property damage under Paragraph 15.2 or any other indemnification
provision contained in this Lease.

         22.7 Intentionally Omitted.

         22.8 Landlord's Default. Landlord shall not be deemed in default
hereunder unless Tenant shall have given Landlord written notice of such default
specifying such default with particularity, and Landlord shall thereupon have
thirty (30) days in which to cure any default unless such default cannot
reasonably be 



                                       22

<PAGE>

cured within such period, in which case Landlord shall not be in default if it
commences to cure the default within the thirty (30) day period and diligently
pursues the completion of same.

         22.9 Limitation on Recourse. If Landlord is in default of this Lease
and, as a consequence, Tenant recovers a money judgment against Landlord, the
judgment shall be satisfied only out of the proceeds of sale received on
execution of the judgment and levy against the right, title and interest of
Landlord in the Shopping Center, other improvements and land of which the
Premises are part, and out of rent or other income from the Shopping Center
receivable by Landlord, or out of the consideration received by Landlord from
the sale or other disposition of all or any part of Landlord's right, title and
interest in the Shopping Center.

         22.10 Notice to Mortgagees and Others. Should Landlord fail to observe
or perform any of the covenants or conditions contained in this Lease and,
before taking any action asserting the right to terminate this Lease (whether or
not Tenant actually has such a right under this Lease), Tenant shall give
written notice to all ground lessors, mortgagees and/or beneficiaries of deeds
of trust (collectively "lenders") under instruments recorded against the
Shopping Center or any part thereof and/or of which Tenant has received written
notice, setting forth the nature of Landlord's default. Such lenders shall have
a reasonable period of time to cure the default and perform any act which may be
necessary to prevent the forfeiture of this Lease. All payments made, and all
acts performed by such lenders in order to cure, shall be effected to prevent a
forfeiture of the rights of Landlord under this Lease and a termination of this
Lease, as if the payments and acts were performed by Landlord instead of by the
lenders. If the lenders cannot reasonably take the action required to cure
Landlord's default without terminating or foreclosing Landlord's interest and
acquiring possession of the Shopping Center, the time within which the default
must be cured to avoid a termination or forfeiture of the Lease shall be
extended to include the period of time reasonably required for such lenders to
obtain possession and to effect a cure with due diligence, provided such lenders
give Tenant a written undertaking to cure the default. In the absence of the
lenders' express written consent, such an undertaking by the lenders shall not
be considered an assumption by the lenders of Landlord's other obligations under
the Lease, and Landlord shall remain solely liable for the performance of all
terms, covenants and conditions of the Lease both prior and subsequent to the
lenders' exercise of any right to cure or related remedy. A lender's exercise of
any right to cure or related remedy shall not in any way constitute a cure or
waiver of a breach or default under a ground lease, note, mortgage, deed of
trust, or any other instrument given as security.

         22.11 Remedies; Interest and Late Charges. Any payment not made when
due shall bear interest at that fluctuating rate (the "Lease Rate") equal to the
discount rate announced from time to time by the Federal Reserve Bank of San
Francisco plus 500 basic points, or the maximum amount allowed by law, whichever
is less. Any payment of Rent not paid when due shall be subject to a late charge
of Two Hundred Fifty Dollars ($250) or five percent (5%) of the rent then due
and payable, whichever is more, to reimburse Landlord for its administrative
costs and expenses in notating and processing such late payment. Such late
charge will not limit Landlord's right to recover its actual costs of collection
or the exercise of its remedies under this Lease, at law or in equity, in the
event of a default, which costs Tenant agrees to pay upon demand. The provisions
of this Paragraph 22.11 shall apply regardless of whether or not the Landlord
has declared a default by Tenant under this Lease.

                                   ARTICLE 23
                   SURRENDER OF PREMISES; REMOVAL OF PROPERTY

         23.1 No merger. The voluntary or other surrender of this Lease by
Tenant to Landlord, or a mutual termination thereof, shall not work a merger,
and shall at the option of Landlord operate as an assignment to it of any or all
subleases or subtenancies affecting the Premises. Furthermore, no termination of
any ground lease or master lease shall work a merger and shall, at the option of
the ground lessor or master lessor, operate as an assignment of any subleases or
subtenancies.

         23.2 Condition Upon Surrender. Upon the expiration or earlier
termination of this Lease, Tenant shall quit and surrender possession of the
Premises to Landlord in broom-clean condition, free of all refuse, trash and
garbage, and in as good order and condition as the same were in at the
Commencement Date or as the same thereafter may be improved by Landlord or 3,
reasonable wear and tear excepted. Tenant shall, without expense to Landlord,
prior to expiration (or earlier termination not due to a Tenant default), remove
or cause to be removed from the Premises all Tenant's Property (as that term is
defined in Paragraph 12.1) and all similar articles of any other persons
claiming under Tenant (unless Landlord exercises its option to have any
subleases or subtenancies assigned to it), and Tenant shall fully repair all
damage to the Premises resulting from such removal. In the event of termination
prior to the expiration of the term hereof, Tenant shall nevertheless remove
Tenant's Property from the Premises in the manner aforesaid within sixty (60)
days after receipt of written direction to do so form Landlord, provided that
Tenant shall remain liable for Rent for the Premises until the completion of
such removal. Notwithstanding the foregoing, Tenant may remove the heating,
ventilation, and air conditioning units, plumbing fixtures and the floor
coverings in the Premises only if directed in writing to do so by Landlord, in
which event Tenant shall do so and shall repair all damage to the Premises
resulting from such removal. In the event Tenant shall fail to remove any of
Tenant's Property as

                                       23

<PAGE>

provided herein, Landlord may, but is not obligated, at Tenant's expense, to
remove all of Tenant's Property as provided in Paragraph 23.3. Tenant shall not
be entitled to remove any items paid for by Landlord.

         23.3 Removal of Property Upon Re-entry. Whenever Landlord shall
re-enter the Premises as provided in this lease, any Tenant's Property and any
other personal property belonging to Tenant (or any person claiming through or
under Tenant) and not removed by Tenant (or such person claiming through or
under Tenant) upon the expiration of the term of this Lease (or upon a judicial
determination that the Tenant's right to possession of the Premises is
terminated by reason of Tenant's default) shall be considered abandoned
(provided, however, that Tenant may have up to sixty days to remove such
property if Tenant pays to Landlord, upon such judicial termination, Rent for
such time period). Landlord shall give Tenant whatever notice may legally be
required of its right to reclaim any abandoned property (currently, California
Civil Code Section 1980 et seq.) and may thereafter remove any or all of such
items and dispose of the same in any manner or store the same in a public
warehouse or elsewhere for the account and at the expense and risk of Tenant. If
Tenant shall fail to pay the cost of storing any such property after it has been
stored for a period of ninety (90) days or more, Landlord may sell any or all of
such property at public or private sale, in such manner and at such times and
places as Landlord, in its sole discretion, may deem proper, without notice to
or demand upon Tenant, for the payment of all or any part of such charges or the
removal of any such property, and shall apply the proceeds of such sale: first,
to the cost and expenses of such sale, including attorneys' fees and costs
actually incurred; second, to the payment of the cost or charges for storing any
such property; third, to the payment of any such sums of money which may then or
thereafter be due to Landlord from Tenant under any of the terms hereof plus
interest at the Lease Rate; and fourth, the balance, if any, to Tenant.

         23.4 Tenant's Right to Remove Property. All of Tenant's Property (as
defined in Paragraph 12.1) shall remain the property of Tenant and, subject to
the provisions of Paragraph 23.2, may be removed by Tenant at any time during
the term, provided Tenant is not in default hereunder, and provided further that
Tenant shall repair any damage caused by such removal. 

                                   ARTICLE 24
                                ATTORNEYS' FEES

         24.1 Litigation Between the Parties. In the even suit is brought to
enforce or interpret any part of this Lease, the prevailing party shall be
entitled to recover, as an element of its costs of suit, and not as damages,
reasonable attorneys' fees and costs incurred therein, and in any appeal in
connection therewith, to be fixed by the court. The "prevailing party" shall be
entitled to recover its costs of suit (whether or not allowable under California
Code of Civil Procedure Section 1033.5) whether or not the suit proceeds to
final judgment. No sum for attorneys' fees and costs shall be counted in
calculating the amount of a judgment for purposes of determining whether a party
is entitled to recover its costs or attorneys' fees and costs. The prevailing
party shall further be entitled to recover all costs and fees incurred in
connection with the enforcement of any judgment or order issued in connection
with such litigation (including without limitation attorneys' fees, Marshall
fees, garnishment, third party examination, levy fees and costs,
bankruptcy-related fees and costs, and post-judgment motions), and this
provision shall not merge with such judgment and shall survive the entry
thereof. Any judgment entered in such action shall contain a specific provision
providing for the recovery of such fees and costs incurred in enforcing such
judgment.

         24.2 Litigation with Third Parties. Should Landlord, for any reason
other than its exclusive gross negligence or willful misconduct, be made a party
to any litigation instituted by Tenant or by any third party against Tenant, or
by or against any person holding under or using the Premises by license,
assignment or sublease of Tenant, or for the foreclosure of any lien for labor
or material furnished to or for Tenant or any such other person or otherwise
arising out of or resulting from any act, omission or transaction of Tenant or
of any such other person, Tenant covenants, at Landlord's election and upon
written tender of defense, to defend (with legal counsel of Landlord's choosing)
and to save and hold Landlord harmless from any liability and any judgment
rendered against Landlord or the Premises or the Shopping Center or any part
thereof, including, without limitation, all costs and expenses (including
attorneys' fees and costs), incurred by Landlord in connection with such
litigation, plus interest at the Lease Rate.

                                   ARTICLE 25
                                     WAIVER

         The waiver by Landlord or Tenant of any breach of any term, covenant or
condition herein contained shall not be deemed to be a waiver of such term,
covenant or condition as to any subsequent breach of the same or any other term,
covenant or condition herein contained. The subsequent acceptance or payment of
Rent hereunder by Landlord or Tenant, as the case may be, shall not be deemed to
be a waiver of any preceding breach by the other of any term, covenant or
condition of this Lease (other than the failure of Tenant to pay the particular
Rent so accepted) regardless of Landlord's or Tenant's knowledge of such
preceding breach at the time of acceptance or payment of such Rent.


                                       24

<PAGE>


                                   ARTICLE 26
                                  HOLDING OVER

If Tenant holds over after the expiration of the term (as defined in Article
28), with or without the express or implied consent of Landlord, such tenancy
shall be from month to month only, and not a renewal hereof or an extension for
any further term, and in such case Rent shall be payable in an amount equal to
twice the amount payable by Tenant during the last month of the term hereof
pursuant to and at the times specified in Articles 3, 4 and 5 herein, and such
month to month tenancy shall be subject to every other term, covenant and
agreement contained herein. Nothing contained in this Article 26 shall be
construed as a consent by Landlord to any holding over by Tenant, or as
relieving Tenant from liability for any damages which such holding over may
cause Landlord, and Landlord expressly reserves the right to require Tenant to
surrender possession of the Premises to Landlord as provided in Article 23
herein forthwith upon the expiration or other termination of the term of this
Lease.

                                   ARTICLE 27
                  SUBORDINATION, ATTORNMENT AND NONDISTURBANCE

         This Lease is subject and subordinate to all ground or master leases,
mortgages, and deeds of trust which now affect the Premises and the Shopping
Center, and to all renewals, modifications, consolidations, replacements, and
extensions thereof. If the lessor under any such lease or the holder or holders
of any such mortgage or deed of trust shall advise Landlord that they desire or
require this Lease to be prior and superior thereto, upon written request of
Landlord to Tenant, Tenant agrees promptly to execute, acknowledge, and deliver
any and all documents or instruments which Landlord or such lessor, holder, or
holders deem necessary or desirable for purposes thereof. Landlord shall have
the right to cause this Lease to be and become and remain subject and
subordinate to any and all ground or master leases, mortgages or deeds of trust
which may hereafter be executed covering the Premises and/or the Shopping
Center, or any renewals, modifications, consolidations, replacements or
extensions thereof, for the full amount of all advances made or to be made
thereunder and without regard to the time or character of such advances,
together with interest thereon and subject to all the terms and provisions
thereof. Tenant agrees, within ten (10) business days after Landlord's written
request therefor to execute, acknowledge, and deliver any and all documents or
instruments requested by Landlord that do not materially diminish or impair
Tenant's rights or materially increase Tenant's obligations or duties under this
Lease and that are necessary or proper to assure the subordination of this Lease
to any such mortgages, deeds of trust, or leasehold estates; provided, however,
the foregoing provisions with respect to such election of subordination by
Landlord shall not be effective unless and until after the owner or holder of
any such mortgage, deed of trust, or the lessor under any such leasehold estate
shall execute with Tenant a nondisturbance agreement reasonably acceptable to
Tenant under which such owner, holder, or lessor shall agree, in the event of
termination of such leasehold estate or upon the foreclosure of any such
mortgage or deed of trust, that Tenant's quiet enjoyment of the Premises will
not be disturbed so long as Tenant pays Rent and observes and performs all of
the obligations under this Lease to be observed and performed by Tenant.
Tenant's failure to deliver such a document or instrument of subordination
within such ten (10) business day period, if required, shall at the option of
Landlord constitute a material breach or default under this lease; provided,
however, that Tenant shall have such additional time to respond following such
10-business day period as may be reasonably necessary under the circumstances to
negotiate the specific terms of any such subordination, non-disturbance and
attornment agreement). Notwithstanding anything to the contrary set forth in
this Article 27, Tenant hereby attorns and agrees to attorn to any Person (as
that term is defined in Article 28) purchasing or otherwise acquiring the
Shopping Center or the Premises at any sale or other proceeding or pursuant to
the exercise of any other rights, powers, or remedies under such mortgages, or
deeds of trust, or ground or underlying leases, at their option, as if such
Person had been named as Landlord herein; provided, however, that the owner or
holder of any such mortgage or deed of trust or the lessor under any such
leasehold estate shall have executed with Tenant a non-disturbance agreement
under which such owner, holder or lessor has agreed, in the event of termination
of such leasehold estate or upon the foreclosure of any such mortgage or deed of
trust, that Tenant's quiet enjoyment of the Premises will not be disturbed so
long as Tenant pays Rent and observes and performs all the obligations under
this Lease to be observed and performed by Tenant, it being intended hereby that
if this Lease is terminated, cut-off or otherwise defeated by reason of any act
or actions by the owner or holder of any such mortgage or deed of trust or the
lessor under any such leasehold estate, then, subject to the execution and
delivery of said non-disturbance agreement, this Lease shall continue in full
force and effect.

                                   ARTICLE 28
                                  DEFINITIONS

         The following words and phrases shall have the following meanings:

            (a) The words "Landlord" and "Tenant," as used herein, shall include
the plural as well as the singular. Words used in neuter gender include the
masculine and feminine and words in the masculine or feminine gender include the
neuter. If more than one person executes this Lease as Tenant, (i) each of them


                                       25
<PAGE>

is jointly and severally liable for the keeping, observing and performing of
each and all of the obligations hereunder imposed upon Tenant and (ii) the act
or notice from, or notice or refund to, or the signature of, any one or more of
them with respect to the tenancy of this Lease shall be binding upon each and
all of the persons executing this Lease as Tenant with the same force and effect
as if each and all of them had so acted or so given or received such notice or
refund or so signed.

            (b) Unless otherwise specified: whenever the term "day(s),"
"month(s)" or "year(s)" is used herein, it shall refer to calendar day(s),
month(s) or year(s) (as the case may be).

            (c) Whenever the words "term," "lease term" or "term of this 
Lease" are used herein, it shall refer to the term of this Lease and any 
prior exercised extensions and renewals thereof.

            (d) "Consent" shall mean the prior written consent of a party, 
which may not be unreasonably withheld or delayed unless expressly indicated 
to the contrary.

            (e) "Landlord's Agent" means any officer, director, servant or 
employee of Landlord or of any affiliate (as such term is defined in Rule 
12b-2 promulgated under the Securities Exchange Act of 1934, as amended) of 
Landlord.

            (f) "Parent" shall mean any Person who owns more than 50% of the
equity or beneficial interest of any other Person.

            (g) "Person" shall mean any one or more human beings, or legal
entities or other artificial persons, including, without limitation,
partnerships, corporations, limited liability companies, trusts, estates,
associations, joint ventures, and any other combination of human beings and/or
legal entities.

            (h) "Tenant Agent" shall mean any officer, director, servant,
employee, agent, contractor, licensee, assignee, invitee or guest of Tenant, and
"tenant agent" shall have the same meaning but with respect to any other tenant
in the Shopping Center.

            (i) "Events of delay" shall mean strikes, lockouts, labor disputes,
power outages, riots, restrictive governmental laws and other events beyond the
control of Landlord or Tenant.

                                   ARTICLE 29
                       HEIRS AND ASSIGNS/TIME OF ESSENCE

            Subject to the provisions of Article 17 above, this Lease is
intended to and does bind and accrue to the benefit of the heirs, executors,
administrators, successors, and assigns of any and all of the parties hereto.
Time is of the essence of this Lease.

                                   ARTICLE 30
                                 INTERPRETATION

         30.1 Severability. If any term or provision of this Lease, the deletion
of which would not adversely affect the receipt of any material benefit by
either party hereunder, shall be held invalid or unenforceable to any extent,
the remainder of this Lease shall not be affected thereby and each term and
provision of this Lease shall be valid and enforceable to the fullest extent
permitted by law.

         30.2 Integration. This Lease along with any exhibits and attachments or
other documents affixed hereto or referred to herein constitutes the entire and
exclusive agreement between Landlord and Tenant relative to the Premises herein
described. Landlord and Tenant hereby agree that all prior or contemporaneous
oral agreements and understandings relative to the leasing of the Premises are
superseded by this Lease.

         30.3 Amendment. This Lease may be altered, amended or revoked only by
an instrument in writing signed by both Landlord and Tenant and making specific
reference to this Lease.

         30.4 Section Headings. The headings included in this lease re for
convenience only, and shall not be used to interpret this Lease.

         30.5 Intentionally Omitted.

         30.6 Lease Draftsman. This Lease was negotiated between the parties and
their respective counsel and professional advisors, and the parties agree that
such provisions shall be interpreted without reference to the draftsman of the
lease or any portion thereof, because this Lease is a product of all their
efforts.

                                       26
<PAGE>

                                   ARTICLE 31
                          RIGHT OF LANDLORD TO PERFORM

         All covenants and agreements to be performed by Tenant under any of 
the terms of this Lease shall be performed by Tenant at Tenant's sole cost 
and expense and without any abatement of Rent. If Tenant shall fail to pay 
any sum of money, other than Rent, required to be paid by it hereunder, or 
shall fail to perform any other act on its part to be performed hereunder, 
and such failure shall continue beyond any applicable grace period set forth 
in Article 22 above, Landlord may, but shall not be obligated so to do, and 
without waiving or releasing Tenant from any obligations of Tenant, make any 
such payment or perform any such other act on Tenant's part to be made or 
performed as in this Lease provided. All sums so paid by Landlord and all 
necessary incidental costs, together with interest thereon at the Lease Rate 
form the date of such payment by Landlord until the date paid in full by 
Tenant, shall be payable to Landlord within ten (10) days of demand. Tenant 
covenants to pay any such sums, and Landlord shall have (in addition to any 
other right or remedy of Landlord) the same rights and remedies in the event 
of the nonpayment thereof by Tenant as in the case of default by Tenant in 
the payment of Rent.

                                   ARTICLE 32
                                    NOTICES

         Unless otherwise specified, all notices which Landlord or Tenant may be
required or may desire to be served on the other shall be in writing and may be
served, as an alternative to personal service, by mailing the same by registered
or certified mail, return receipt requested, postage prepaid, or by "Federal
Express" or other overnight air courier service, free prepaid, addressed to
Landlord at the address for Landlord set forth in the Lease Summary, and to
Tenant at the address for Tenant set forth in the Lease Summary, or addressed to
such other address or addresses as either Landlord or Tenant may from time to
time designate to the other in writing. Any such notice shall only be deemed to
have been given for purposes of this Lease at the time such writing is
personally delivered or, in the case of certified or registered mailing thereof,
upon actual receipt or the date of refusal to accept such mailing, or on the
first business day after deposit with an overnight air courier service.

                                   ARTICLE 33
                                QUIET ENJOYMENT

         Landlord covenants and agrees that Tenant, upon paying the Rent and all
other charges herein provided for and observing and keeping the covenants,
agreements and conditions of this Lease on its part to be observed and kept,
shall lawfully and quietly hold, occupy and enjoy the Premises during the term
of this Lease without hindrance or molestation of anyone lawfully claiming by,
through or under Landlord, subject, however, to the matters set forth in this
Lease. Landlord shall not be liable for any acts of other tenants, their
employees, invitees or customers or any other third party.

                                   ARTICLE 34
                              ESTOPPEL CERTIFICATE

         Tenant agrees at any time and from time to time upon not less than ten
(10) business days' prior notice by Landlord, to execute, acknowledge and
deliver to Landlord a statement in writing certifying that this Lease is
unmodified and in full force and effect (or if there have been modifications,
that the same are in full force and effect as modified and stating the
modifications), the dates to which the Fixed Rent, Additional Rent, and other
charges have been paid in advance, if any, stating whether or not to the best
knowledge of the signer of any such certificate, Landlord is in default in
performance of any covenant, agreement or condition contained in this Lease and,
if so, specifying each such default of which the signer may have knowledge, and
setting forth such other information as Landlord may reasonably request; it
being intended that any such statement delivered pursuant hereto may be relied
upon by any prospective purchaser of the Premises or any interest of Landlord
therein, or any prospective mortgagee thereof or any prospective assignee of any
mortgagee thereof or any prospective master or ground lessor. In the event that
Tenant fails to return such estoppel certificate in accordance with the above,
then Tenant shall be in default hereunder pursuant to Article 22; and at
Landlord's option, the copy of the estoppel certificate as delivered to Tenant
for execution shall be deemed to be correct and may be relied upon.

                                   ARTICLE 35
                                   AUTHORITY

         If Tenant is a corporation, each individual executing this Lease on
behalf of said corporation represents and warrants that he or she is duly
authorized to execute and deliver this Lease on behalf of such corporation in
accordance with a duly adopted resolution of the Board of Directors of such
corporation or in accordance with the bylaws of such corporation, and that this
Lease is binding upon such corporation in accordance with its terms. If Tenant
is a partnership or joint venture, each individual executing this Lease on
behalf of said partnership or joint venture represents and warrants that he or
she is duly authorized to executive 


                                       27
<PAGE>

and deliver this Lease on behalf of such partnership or joint venture in
accordance wit the partnership or joint venture agreement of such partnership or
joint venture, and that this Lease is binding upon such partnership or joint
venture in accordance with its terms. If Landlord is a limited liability
company, each individual executing this Lease on behalf of such entity
represents that he or she is duly authorized to execute and deliver this Lease
on behalf of such entity in accordance with the articles of organization and the
operating agreement of such entity and that this Lease is binding on such entity
in accordance with their terms.

                                   ARTICLE 36
                                    BROKERS

         Landlord and Tenant each hereby represent and warrant to the other 
that it has had no dealings with any real estate broker, agent or finder in 
connection with this lease other than as specified in Paragraph 12 of the 
Lease Summary, and knows of no real estate broker, agent or finder who is 
entitled to a commission or finder's fee in connection with this Lease other 
than as specified in Paragraph 12 of the Lease Summary. Landlord and Tenant 
shall each bear the cost of their respective brokers. Landlord and Tenant 
hereby each indemnify, hold harmless, and shall defend the other against 
either's breach of its representation and warranty.

                                   ARTICLE 37
                            ACCORD AND SATISFACTION

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

         37.2 Application of Payments. In the event Tenant submits a payment of
less than the total combined amount of all payments required under this Lease,
then Landlord shall have the option to credit said payment towards any of said
items it so desires, notwithstanding any specification of Tenant.

                                   ARTICLE 38
                             LANDLORD RESERVATIONS

         Landlord reserves the right from time to time in Landlord's sole and
absolute discretion:

            (a) to make changes to the structure, location, size and
configuration of the Common Areas, and to grant exclusive licenses and/or leases
with respect to the use of and/or occupancy of any portions of the Common Areas.

            (b) To close temporarily any of the Common Areas for maintenance
purposes or to construct additional improvements or to demolish existing
improvements, so long as reasonable access to the premises remains available in
the Common Areas;

            (c) To expand or contract the Shopping Center by adding buildings
and improvements or demolishing buildings and improvements, even though such
additions or deletions may vary the availability of parking spaces within the
Common Areas or to change street entrances to the Shopping Center.

            (d) To use the Common Areas while engaged in making additional
improvements, repairs or alterations to buildings in the Shopping Center, or any
portion thereof;

            (e) To do and perform such other acts and make such other changes
in, to or with respect to the Common Areas and the Shopping Center as Landlord
may, in its sole discretion, deem to be desirable and appropriate;

            (f) To establish, promulgate and enforce rules and regulations
concerning the Shopping Center, in addition to those already adopted and
attached as Exhibit "B" hereto, for the proper and efficient management,
operation, maintenance and use thereof, or in order to comply with new or
superseding governmental laws, rules or regulations. Such Rules and Regulations
may be canceled, changed, modified and/or supplemented from time to time by
Landlord. Upon dissemination of the same to Tenant, such Rules and Regulations
shall be deemed fully incorporated herein, and a breach of the same by Tenant
shall constitute a default hereunder. Landlord agrees to enforce the Rules and
Regulations without discrimination and impartially among all tenants similarly
affected. However, in the event of any disagreement or inconsistency between the
Rules and Regulations and this Lease as interpreted without such incorporation,
the Lease as so interpreted shall control;

                                       28
<PAGE>

            (g) To use portions of the Common Areas for carnival-type shows,
rides and entertainment, outdoor shows, displays, automobiles and other product
shows, the leasing of kiosks and other uses which, in Landlord's sole judgment,
tend to attract the public or benefit the Shopping Center in any way;

            (h) To use the Common Areas for advertising purposes and (subject to
Article 21) to move or remove any signage at any time; and

            (i) To change the name of the Shopping Center.

                                   ARTICLE 39
                               LENDER'S APPROVAL

         The Lease is subject to the approval of all mortgagees and master on
ground lessors having such approval rights, and if any such entity disapproves
of this Lease within twenty (20) days after the execution hereof, Landlord shall
have the right to cancel this Lease, without any liability whatsoever, by
written notice of cancellation given to Tenant within ten (10) days after the
execution of this Lease, this Lease shall continue in full force and effect. The
delivery of a recognition and non-disturbance agreement signed by the Master
Landlord and mortgagee, if any, may serve as evidence of their respective
approvals of this Lease.

                                   ARTICLE 40
                       HAZARDOUS OR INFECTIOUS SUBSTANCES

         40.1 Covenants of Tenant Regarding Hazardous or Infectious Substances. 
Tenant represents, warrants and covenants as follows:

            (a) No "Hazardous Substance" (as defined hereinbelow) will be
brought upon, used kept or stored in, on, about or under the Premises or
anywhere else in the Shopping Center by Tenant, its agents, representatives,
employees, contractors or invitees, without the prior written consent of
Landlord satisfaction that such Hazardous Substance is necessary or useful to
Tenant's business and will be brought upon, used, kept and stored in a manner
which complies with all "Environmental, Health and Safety Requirements" (as
defined hereinbelow) regulating such Hazardous substance, and with the highest
standards prevailing in the industry for such Hazardous Substance).
Notwithstanding this restriction, Tenant may bring, use, keep, and store in the
Premises merchandise and supplies customarily used and found in other Eagle
Hardware and Garden stores that would otherwise fall within the description of
Hazardous Substances, provided that any such items that would be classified as a
Hazardous Substance may be brought upon the Premises, and used, kept, and stored
only in a manner which complies with all Environmental, Health and Safety
Requirements and with the highest standards prevailing in the industry for such
Hazardous Substance.

            (b) If any Hazardous Substance is brought upon, used, kept or stored
in, on, about or under the Premises or Shopping Center by Tenant, then Tenant
shall do so in a manner which complies with all Environmental, Health and Safety
Requirements regulating such Hazardous Substance and with the highest standards
prevailing in the industry for such Hazardous Substance. Without limiting any of
the other obligations of Tenant set forth in this Lease, Tenant shall, at its
own cost and expense, procure, maintain in effect and comply with all conditions
and requirements of any and all permits, licenses and other governmental and
regulatory approvals or authorizations required under any Environmental, Health
or Safety Requirement in connection with the bringing, use, keeping and storage
of such Hazardous Substance in, on, about or under the Premises or Shopping
Center. Tenant shall submit to Landlord copies of all such permits, licenses, or
other governmental or regulatory approvals or authorizations within five (5)
business days of its receipt thereof.

            (c) Upon written demand by Landlord in any instance in which the
presence of any Hazardous Substance on the Premises or in the Shopping Center
was caused or permitted by Tenant without Landlord's prior written consent,
Tenant shall promptly remove and dispose of the same at Tenant's sole cost and
expense and in compliance with all applicable Environmental, Health and Safety
Requirements. If the presence of any Hazardous Substance in, on, about or under
the Premises or Shopping Center caused or permitted by Tenant results in an
contamination of the Premises or Shopping Center or the surrounding environment,
Tenant shall promptly take all actions at its sole cost and expense as are
necessary to return the Premises or Shopping Center or the surrounding
environment to the condition existing prior to such contamination (the
"Remediation"); provided, however, that Tenant shall not undertake any
Remediation without first providing Landlord with written notice thereof and
obtaining Landlord's approval therefor. Tenant shall carry out any remediation
in a manner which will minimize the impact on the businesses conducted by other
tenants in the Shopping Center and in a manner which complies with all
Environmental, Health and Safety Requirements. Further, Tenant shall not
undertake any Remediation, nor enter into any settlement agreement, consent
decree or other compromise with respect to any claims relating to any Hazardous
Substance in any way connected with the Premises or Shopping Center without
first notifying 

                                       29
<PAGE>

Landlord of Tenant's intention to do so and affording Landlord ample opportunity
to appear, intervene or otherwise appropriately assert and protect Landlord's
interest with respect thereto.

            (d) Upon the expiration or early termination of the term of this
Lease, Tenant shall cause to be removed from the Premises or Shopping Center, as
appropriate, all Hazardous Substances brought upon, used, kept or stored in, on,
about or under the Premises or Shopping Center by Tenant, as well as all
receptacles or containers therefor, and shall cause such Hazardous Substances
and such receptacles or containers to be stored, treated, transported and/or
disposed of in compliance with all applicable Environmental, Health and Safety
Requirements. Any Hazardous Substances or receptacles or container therefor
which Tenant causes to be removed from the Premises or Shopping Center shall be
removed solely by duly licensed haulers and transported to and disposed of at
duly licensed facilities for the final disposal of such Hazardous Substances and
receptacles or containers therefor. Tenant shall deliver to Landlord copies of
any and all manifests and other documentation relating to the removal, storage,
treatment, transportation and/or disposal of any Hazardous Substances or
receptacles or containers therefor reflecting the legal and proper removal,
storage, treatment, transportation and/or disposal thereof. Tenant shall, at its
sole cost and expense, repair any damage to the Premises or Shopping Center
resulting from Tenant's removal of such Hazardous Substances and receptacles or
containers thereof. Tenant's obligation to pay Fixed Rent and all other charges
shall continue until such removal by Tenant has been completed to Landlord's
satisfaction, notwithstanding the expiration or early termination of the term of
this Lease.

            (e) Tenant shall, from time to time, execute such affidavits,
certificates or other documents as may be requested by Landlord concerning
Tenant's best knowledge and belief regarding the presence of Hazardous
Substances in, on, about or under the Premises or Shopping Center. Further, each
year throughout the term of this Lease, on the anniversary date hereof, Tenant
shall deliver to Landlord a letter stating that during the preceding year Tenant
has complied with the provisions of this Article 40 or, if Tenant has not so
complied, a letter setting forth the details concerning its noncompliance.

            (f) Tenant shall notify Landlord in writing immediately upon
becoming aware of: (i) any enforcement, cleanup, remediation or other action
threatened, instituted or completed by any governmental or regulatory agency or
private person with respect to the Premises or Shopping Center relating to
Hazardous Substances; (ii) any claim threatened or made by any person against
Tenant or the Premises or Shopping Center for personal injury, property damage,
other losses, contribution, cost recovery, compensation or any other matter with
respect to the Premises or the Shopping Center relating to Hazardous Substances;
(iii) any reports made by or to any governmental or regulatory agency with
respect to the Premises or Shopping Center relating to Hazardous Substances,
including without limitation any complaints, notices or asserted violations in
connection therewith; and (iv) any other information with respect to the
Premises or Shopping Center relating to Hazardous Substances. Further, Tenant
shall also supply to Landlord as promptly as possible, and in any event within
five (5) business days after Tenant first receives or sends the same, copies of
all claims, reports, complaints, notices, warnings, asserted violations or other
documents relating in any way to the foregoing.

            (g) Landlord and its agents and representatives shall have the right
to communicate, verbally or in writing, with any governmental or regulatory
agency or any environmental consultant on any matter with respect to the
Premises or Shopping Center relating to Hazardous Substances. Landlord shall be
entitled to copies of any and all notices, inspection reports or other documents
issued by or to any such governmental or regulatory agency or consultant with
respect to the Premises or Shopping Center relating to Hazardous Substances.

         40.2 Indemnification. If Tenant breaches any of its covenants or
obligations in this Article 40, or if the presence of Hazardous Substances on
the Premises or Shopping Center caused or permitted by Tenant results in
contamination of the Premises or Shopping Center, or if contamination of the
Premises or Shopping Center by hazardous Substances otherwise occurs for which
Tenant is legally liable to Landlord for damage resulting therefrom, or if any
lender or governmental agency requires an investigation to determine whether
there has been any contamination of the Premises or Shopping Center, then,
Tenant shall indemnify, defend and hold harmless Landlord, any subsidiary or
other affiliate of Landlord, and any director, officer, shareholder, employee,
agent, attorney or partner of any of the foregoing, from any and all claims,
damages, penalties, fines, costs, liabilities and losses (including, without
limitation, diminution in value of the Premises or Shopping Center, damages for
the loss or restriction on use of rental or useable space or of any other
amenity of the Premises or Shopping Center, damages arising from any adverse
impact on marketing of space in the Premises or Shopping center, other
consequential damages and sums paid in settlement of clams, attorneys' fees,
consultants' fees and experts' fees) which arise during or after the term of
this lease as a result of such contamination. This indemnification of Landlord
by Tenant includes, without limitation, costs incurred in connection with any
investigation of site conditions or any cleanup, remedial, removal or
restoration work required by any governmental or regulatory agency or any
private person due to the presence of Hazardous Substances at the Premises or
Shopping Center or in the soil or groundwater in, on, about or under the
Premises or Shopping Center.

                                       30
<PAGE>

         40.3 Inspection. If Tenant breaches its covenants or obligations in
this Article 40, or if the presence of Hazardous Substances on the Premises or
Shopping Center caused or permitted by Tenant results in contamination of the
Premises or Shopping Center, or if contamination of the Premises or Shopping
Center by Hazardous Substances otherwise occurs for which Tenant is legally
liable to Landlord for damage resulting therefrom, or if Landlord, any lender or
governmental agency requires an investigation to determine whether there has
been any violation of this Article 40, then, Landlord and its agents and
representatives shall have the right, at any reasonable time and form time to
time during the term of this Lease, to enter upon the Premises to perform
monitoring, testing or other analyses, and to review any and all applicable
documents, notices, correspondence or other materials which may be in the
possession of Tenant. Further, Tenant shall be obligated to provide Landlord,
within five (5) business days of Landlord's request therefor, with copies of all
such applicable documents which may be in Tenant's possession but are not at the
Premises. All costs and expenses reasonably incurred by Landlord in connection
therewith shall become due and payable by Tenant upon Landlord's presentation to
Tenant of an invoice therefor.

         40.4 Definition of Hazardous Substance. As used herein, the term
"Hazardous Substance" shall mean any substance, material, waste, contaminant or
pollutant determined by any local, regional, state or federal governmental
agency, court, judicial or quasi-judicial body or legislative or
quasi-legislative body pursuant to any Environmental, Health and Safety
Requirement to be hazardous, toxic, infectious, radioactive, ignitable or
flammable, corrosive, persistent or bioaccumulative, explosive, reactive or
otherwise dangerous, including but not limited to crude oil and its fractions,
including petroleum and petroleum products, gasoline and waste oil.

         40.5 Definition of Environmental, Health and Safety Requirement. As
used herein, the term "Environmental, Health and Safety Requirement" shall mean
any law, statute, ordinance, rule, regulation, order, judgment or decree
promulgated by any local, regional, state or federal governmental agency, court,
judicial or quasi-judicial body or legislative or quasi-legislative body which
relates to matters of the environment, health, industrial hygiene or safety.

         40.6 ANY AND ALL LIABILITIES ARISING FROM THE MANUFACTURING,
GENERATION, HANDLING, USE, STORAGE, TREATMENT, TRANSPORTATION OR DISPOSAL OF
HAZARDOUS SUBSTANCES PERFORMED OR CAUSED TO BE PERFORMED BY TENANT, OR ITS
AGENTS, REPRESENTATIVES, EMPLOYEES, CONTRACTORS OR INVITEES, SHALL AT ALL TIMES
REMAIN THE SOLE RESPONSIBILITY OF TENANT AND TENANT SHALL RETAIN ANY AND ALL
LIABILITIES ARISING THEREFROM. NOTWITHSTANDING ANYTHING TO THE CONTRARY SET
FORTH IN THIS ARTICLE 40, ANY ACT BY LANDLORD OR ITS AGENTS OR REPRESENTATIVES
HEREUNDER SHALL NOT CONSTITUTE AN ASSUMPTION BY LANDLORD OF ANY OBLIGATIONS,
DUTIES, RESPONSIBILITIES OR LIABILITIES OF TENANT HEREUNDER, INCLUDING WITHOUT
LIMITATION TENANT'S COMPLIANCE WITH ANY ENVIRONMENTAL, HEALTH OR SAFETY
REQUIREMENT, WHICH TENANT SHALL RETAIN UNDER ALL CIRCUMSTANCES AND SHALL
INDEMNIFY, DEFEND AND HOLD HARMLESS LANDLORD AS PROVIDED HEREIN. FURTHER,
NOTWITHSTANDING ANYTHING TO THE CONTRARY SET FORTH IN THIS ARTICLE 40, EVEN
THOUGH HAZARDOUS SUBSTANCES REMOVED, TRANSPORTED AND DISPOSED OF BY TENANT MAY
ORIGINATE FROM THE PREMISES OR SHOPPING CENTER, TENANT SHALL REMAIN FULLY LIABLE
FOR THEIR REMOVAL, TRANSPORTATION AND DISPOSAL AND SHALL INDEMNIFY, DEFEND AND
HOLD HARMLESS LANDLORD AS PROVIDED HEREIN.

         40.7 Tenant's Liability. The representations, warranties, covenants,
agreements and indemnities of Tenant set forth in this Article 40 shall survive
the expiration or earlier termination of this Lease and shall not be affected by
any investigation, or information obtained as a result of any investigation, by
or on behalf of Landlord or any prospective lessee.

                                   ARTICLE 41
                               UTILITY RATIONING

         Tenant acknowledges that the Premises may become subject to the
rationing of utility services, or restrictions on use. Notwithstanding any such
rationing or restrictions on use of any such utility services, Tenant
acknowledges and agrees that its tenancy and occupancy hereunder shall be
subject to such rationing restrictions as are now or which may hereafter be
imposed upon Landlord, Tenant, the Premises or the Shopping Center, and Tenant
shall in no event be excused or relieved from any covenant or obligation to be
kept or performed by Tenant by reason of any such rationing or restrictions.
Tenant further agrees to pay and discharge, prior to delinquency, any amount,
tax, charge, surcharge, assessment, or imposition levied or assessed or imposed
upon the Premises, or Tenant's use and occupancy thereof, or the utility
services therein, or the delivery or use thereof, or as a result, whether
directly or indirectly, of any such rationing or restrictions.

                                       31
<PAGE>

                                   ARTICLE 42
                                     TITLE

         Landlord is aware of no claims, rights, easements, or restrictions
governing the Premises except for those listed on the Preliminary Title Report
No. 8300033-MO7 issued by Chicago Title Insurance Company dated as of January 9,
1998 (the "Title Report"), a copy of which has been provided to Tenant. Landlord
shall have no obligation to change, remove, alter, or add any items to record
title to the premises (except for a short form memorandum of lease as provide in
Article 43, below). Landlord and Tenant acknowledge and agree that the
Declaration is in the process of being amended to provide for, among other
things, Tenant's use of the Premises under this Lease. Such amendment shall be
superior to the lien and charge of this Lease. Landlord shall be responsible for
the cost of a CLTA leasehold policy of title insurance insuring title in the
policy amount of $5,000,000, which policy shall be subject to all items
reflected on the Title Report, the amendment to the Declaration, and any other
such items caused to be of record by or on behalf of Tenant. If Tenant desires
an ALTA policy, Tenant shall be responsible for the incremental premium cost and
the cost of any additional survey (or supplement to Landlord's existing survey).

                                   ARTICLE 43
                               MEMORANDUM OF LEASE

         Landlord agrees to execute and deliver to Landlord a short form
memorandum of this Lease which Tenant may record at Tenant's sole cost and
expense. Upon recordation, Tenant shall deliver a recorder-stamped copy of such
memorandum to Landlord. Upon the expiration or earlier termination of this
Lease, Tenant shall record at Tenant's sole cost and expense a termination or
cancellation of such memorandum or such other documents reasonably required by
Landlord to remove such Short Form Memorandum from record title.

         IN WITNESS WHEREOF, the parties hereto have executed this Lease as of
the Execution Date.

                                    LANDLORD:

                                    FF PROPERTIES, L.P.,
                                    a California limited partnership

                                    By:  Carnoustie, Inc.,
                                         a California corporation,
                                         General partner

                                    By:   [Illegible]
                                        -----------------------------
                                    Name:  /s/ James D. Vandever
                                          ---------------------------
                                    Title:  vice president
                                           --------------------------

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

                                    TENANT:
                                    EAGLE HARDWARE & GARDEN, INC.,
                                    a Washington corporation

                                    By:  /s/ Richard T. Takata
                                        -----------------------------
                                    Name:   RICHARD T. TAKATA
                                          ---------------------------
                                    Title:  PRESIDENT & CEO
                                           --------------------------

                                    By:  /s/ Ronald P. Maccarone
                                        -----------------------------
                                    Name:  Ronald P. Maccarone
                                          ---------------------------
                                    Title:  EVP/C.F.O.
                                           --------------------------

<PAGE>

                                  EXHIBIT "A"

                      WESTMINSTER GATEWAY SHOPPING CENTER

                          SITE PLAN OF SHOPPING CENTER



<PAGE>

                                  EXHIBIT "A"

                                   [GRAPHIC]



<PAGE>

                                 EXHIBIT "A-1"

                      WESTMINSTER GATEWAY SHOPPING CENTER

                                   TRACT MAP


<PAGE>


                                  EXHIBIT "A-1"


                                    [GRAPHIC]


<PAGE>

                                  EXHIBIT "A-2"

             WESTMINSTER GATEWAY SITE PLAN (COMMON AREAS IDENTIFIED)



<PAGE>

                                  EXHIBIT A-2

                                   SITE PLAN


                                   [GRAPHIC]



<PAGE>



                                  EXHIBIT "B"

                      WESTMINSTER GATEWAY SHOPPING CENTER

                             RULES AND REGULATIONS

1.   Neither Tenant nor its employees shall use any roadway, walkway, or 
parking area except as a means of egress from or ingress to store areas or 
parking areas within the Shopping Center. Such use shall be in an orderly 
manner in accordance with directional or other signs or guides. Roadways 
shall not be used for parking or stopping, except as posted for the immediate 
loading or unloading of passengers.

2.   The employees of Tenant shall not use any parking area, except for the 
parking of motor vehicles during the period of time they are in fact 
employees of Tenant. All motor vehicles shall be parked in an orderly manner 
within the painted lines defining the individual parking places.

3.   In connection with any use of the Common Areas, unless the Lease 
expressly provides otherwise, Tenant shall not, without the express prior 
written consent of Landlord (which may be withheld in Landlord's sole 
discretion): (a) vend, peddle, display, place or solicit orders for sale or 
distribution of any merchandise, device, service, periodical, book, pamphlet 
or other matter whatsoever (except for sidewalk sales adjacent to Tenant's 
Premises); (b) exhibit any sign, placard, barrier, notice or other written 
material; (c) distribute any circular, booklet, handbill, placard or other 
material; (d) solicit membership in any organization except for membership in 
Tenant's business), group or association or contribution for any purpose; (e) 
parade, patrol, demonstrate or engage in any conduct that might tend to 
interfere with or impede the use (except as allowed herein) of the Common 
Areas by Landlord or any tenant or any employee or invitee of any tenant, or 
create a disturbance, attract attention or harass, annoy, or disparage 
business establishments within the Shopping Center; (f) deface, damage or 
demolish any sign, light standard or fixture, landscaping material or other 
improvement or property situated within the Shopping Center; or (g) permit 
any portion of the Shopping Center to be utilized for lodging or care taking 
purposes.

4.   Each Lot in the Shopping Center contains portions of the Common Areas, 
as shown on Exhibit "A-2," which Common Areas shall be maintained by Landlord 
in accordance with this Lease. All tenants in the Shopping Center (excluding 
the occupant of Lot 1 of the Shopping Center, currently Wal-Mart Stores, 
Inc.) are prohibited from making any alterations, additions, or improvements 
to any Common Areas, including the landscaping, located on their respective 
lots without the prior written consent of Landlord which may be withheld in 
Landlord's commercially reasonable judgment.






<PAGE>

                                  EXHIBIT "C"

                      WESTMINSTER GATEWAY SHOPPING CENTER

                              CONSTRUCTION EXHIBIT

1.   General. The building which is a part of the Premises ("Building") shall 
     be constructed by Tenant in accordance with this Exhibit "C". The 
     Building shall have an area of approximately one hundred thirteen 
     thousand one hundred (113,100) square feet and shall be located within 
     an area of real property consisting of approximately five hundred 
     thousand (500,000) square feet (the "Premises"). The buildable "Pad", 
     consisting of one hundred thirty-seven thousand five hundred and fifty 
     (137,550) square feet, shall be deemed to include the area of the 
     Premises containing the Building, a garden yard containing approximately 
     twenty-four thousand four hundred and fifty (24,450) square feet, and 
     sidewalks and landscaping at the perimeter of the Building. The Pad 
     shall be located as outlined by the heavy-dashed line, which is also the 
     approximate "Building Limit Line")as hereinafter defined), on Exhibit 
     "D" Plot Plan attached to the Lease to which this Exhibit "C" is 
     attached ("Lease"), subject to modification as provided for by the 
     Lease. The following improvements are collectively referred to as the 
     "Tenant Improvements" and to be constructed on the Pad by Tenant at its 
     expense: the Building, garden yard, signage, trash enclosures, adjacent 
     sidewalks, and landscaping (within the Building Limit Line), plus all 
     improvements such as furniture, fixtures, equipment, trade fixtures, and 
     other improvements necessary for Tenant's operations. For purposes 
     hereof, the term "Building Limit Line" means the area outlined by the 
     outside curb face of any building perimeter sidewalk; five (5) feet from 
     all exterior walls, garden yard enclosures and truck wells (in the 
     absence of a perimeter sidewalk); five (5) feet outside the vertical 
     "drip" line of all canopies, roof overhangs and covered area roof lines; 
     and the distance customarily allowed by standard industry practices and 
     applicable building codes where any exterior walls are abutted by an 
     adjoining building.

2.   Exterior Design Approval. Landlord shall have the right to approve an 
     exterior building design plan for the Tenant Improvements ("Exterior 
     Design Plan"). Within seven (7) working days after the date of execution 
     of the Lease, Tenant, at Tenant's sole cost and expense, shall cause to 
     be prepared and delivered to Landlord for Landlord's approval three 93) 
     copies of an Exterior Design Plan. The Exterior Design Plan and Tenant's 
     Site Plan (MCG Architects, Eagle Hardware Site Study 2, version dated 
     01/12/98) are attached to the Lease as Exhibits "A-3" and "D" 
     respectively. Landlord shall review the Exterior Design Plan within five 
     (5) days after receipt from Tenant. Landlord's review shall be based 
     upon, among other things, Landlord's determination, in Landlord's 
     reasonable discretion, of the aesthetic compatibility of the Exterior 
     Design Plan with the remainder of the Shopping Center. Tenant's exterior 
     (internally illuminated) sign design (logo) and colors and other 
     exterior building signs used typically by Tenant on a chain-wide basis 
     shall be excluded from Landlord's Exterior Design Plan approval process 
     (but shall nonetheless comply with all applicable governmental 
     regulations and the Declaration). Should the Exterior Design Plan be 
     disapproved by Landlord, Tenant, at its sole cost, shall make such 
     changes Tenant is willing to make and resubmit the corrected Exterior 
     Design Plan, to Landlord within five (5) working days following 
     Landlord's notice of disapproval. If, following the same review process, 
     Landlord fails to then approve the revised Exterior Design Plan, Tenant 
     may at its option cancel the Lease or the foregoing process shall be 
     repeated until the Landlord approves the Exterior Design Plan (or until 
     Tenant cancels the Lease). The Exterior Design Plan, once approved, 
     shall be referred to as the Final Exterior Design Plan.

3.   Plans and Specifications. Tenant, at Tenant's sole cost and expense, 
     shall cause to be prepared and delivered to Landlord for Landlord's 
     review three (3) sets of complete working drawings and specifications 
     for the Tenant Improvements in the form of reproducible prints. Such 
     working drawings and specifications shall be in conformance with the 
     Final Exterior Design Plan, and shall also be in conformance with the 
     overall design and concept criteria established by the Landlord with 
     respect to the Shopping Center. Such working drawings and specifications 
     shall be prepared by a licensed architect and/or engineer and shall 
     include drawings and specifications of such scope as to completely 
     delineate the nature and extent of the Tenant Improvements. Technical 
     specifications shall be prepared in accordance with A.I.A. and/or C.S.I. 
     standard format(s). The working drawings and specifications shall also 
     include final plans for all Pad landscaping and hardscaping per the 
     design theme already approved by the City of Westminster. The following 
     must be shown on the working drawings and specifications for the 
     Building:

     a.   Concrete Slab

         i.    Locate any floor drains, restroom or other plumbing connections.

         ii.   Locate any grease traps, floor safe, etc. requiring canouts in
               slab.

                                  Page 1 of 7


<PAGE>


         iii.  Indicate any particular finish to slab, e.g., smooth trowel
               finish, etc.

         iv.   Indicate any slab depressions required for ceramic tiles, brick
               pavers, etc.

         v.    Indicate column pads, if any, and interior bearing footings.

         vi.   Show any exterior wall footing. Show if any cold joints are
               required.

         vii.  Locate electrical floor outlets.

         viii. Indicate underslab sleeves and raceways, for special or future
               uses.

     b.  Electrical

         i.    Show total connected load. Indicate size of panels to be required
               including sub-panel arrangements.

         ii.   Show any floor outlets and underground conduit.

         iii.  Provide interior circuitry diagrams showing location of ceiling
               outlets and wall switches.

         iv.   Locate light fixtures.

         v.    Indicate any motors or special circuits affecting the sub-panel
               or meter panel.

         vi.   EMT or rigid conduit must be employed. Romex is not permitted.

         vii.  Indicate safety switches if required.

         viii. Location of all electrical items on plans.

     c.  Plumbing

         i.    Indicate any hot water equipment; show whether electric or gas,
               and indicate venting.

         ii.   Indicate any gas operated equipment, size of piping and vents.

         iii.  Note on plans any Health Department requirements.

         iv.   Locate sewer connection and cleanout, if required.

         v.    Gas piping shall be located at roof height; indicate water lines
               underground or overhead.

     d.  Ceiling

         i.    Indicate ceiling material, i.e., drywall, exposed wood,
               acoustical, etc.

         ii.   Indicate exposed or concealed grid, finish on exposed grid.

         iii.  Show direction of panels.

         iv.   Show fire clips.

         v.    Name, brand and pattern of inlay tiles.

         vi.   Indicate ceiling height above finish floor.

         vii.  Show any track lights or requirement for special treatment of
               tiles.

     e.  Fire Sprinklers

         Indicate that sprinklers shall be per code.

     f.  Insulation


                                  Page 2 of 7


<PAGE>

         Provide R-19 at ceiling line, R-11 in all perimeter walls or insulation
         so as to meet minimum code requirements, whichever is the higher
         R-value.

     g.  Air Conditioning

         Provide complete plans showing name, weight, and size of equipment as
         well as complete layout for distribution system.

     h.  Painting

         i.    Indicate special surface preparation.

         ii.   Provide color schedule per approved Final Exterior Design Plan.

     i.  Finish Carpentry

         Indicate any special treatment, pattern and milling number (if
         applicable).

     j.  Glass and Glazing

         i.    Specify if tempered, thickness, color, heat resistant, etc.

         ii.   If metal extrusions, show pattern number, finish.

         iii.  If wood, name material, detail the stops and other trim.

     k.  Floor Covering

         i.    Hard Floor-specify material and base.

         ii.   Carpet-specify carpet and pad (if applicable).

     l.  Ceramic Tile

         Name  material, pattern, mastic or mud-set. If a Health Department
         requirement, show approval

     m.  Light Fixtures

         i.    Show any special requirements for installation.

         ii.   Indicate specific manufacture and brand name.

     n.  Utilities

         i.    Indicate utilities within pad and coordinate locations with
               respective utilities for ultimate offsite utility services.

     o.  Signage

         Indicate locations and specifications of signage.

Landlord shall notify Tenant within ten (10) days of Landlord's receipt of 
such drawings and specifications of the respects, if any, in which such 
drawings and specifications fail to conform to the Final Exterior Design Plan 
or the overall design and concept criteria established by the Landlord with 
respect to the Shopping Center, and Tenant shall, at Tenant's cost and 
expense, within fifteen (15) days after receipt of such notification, make 
such revisions as Tenant is willing to make so that the Final Exterior Design 
Plan or the drawings and specifications conform to such concept criteria. The 
foregoing procedure shall be repeated until the drawings and specifications 
are reasonably in conformance satisfactory to Landlord; provided, however, 
that if Landlord disapproves Tenant's improvement plans more than once and 
Tenant thereafter declines to make the changes requested by Landlord, Tenant 
shall so notify Landlord in writing and Landlord shall have the option, 
exerciseable by written notice to Tenant within five (5) days after the date 
that Tenant informs Landlord that it will not further revise the drawings and 
specifications, to either withdraw its disapproval and allow Tenant to 
proceed, or to terminate the Lease by delivering a thirty (30) day written 
notice to Tenant. If Landlord fails to exercise its option, Landlord will be 
deemed to have withdrawn its disapproval and 

                                  Page 3 of 7


<PAGE>

     Tenant may proceed. Landlord shall initial and date one (1) set of the 
     approved working drawings and specifications and return them to Tenant. 
     The working drawings and specifications as approved by Landlord shall be 
     referred to as "the Working Drawings and Specifications" or, in the 
     alternative, shall be referred to as "Plans and Specifications". Tenant 
     shall send to Landlord, at Landlord's cost and expense, one (1) 
     reproducible set of the Working Drawings and Specifications.

4.   Site Preparation by Landlord. Landlord shall tender possession to Tenant 
     of the buildable Pad with all utilities required per the Plans and 
     Specifications stubbed to the Building Limit Line at the locations 
     identified on the Plans and Specifications. Landlord shall also be 
     responsible for the construction of on-site improvements outside of the 
     Building Limit Line (including site drainage to handle Tenant's surface 
     water (roof and ground) drainage) and for all site fees related thereto 
     (subject to Tenant's pro rata reimbursement in accordance with Section 
     4(c), below). Landlord shall have no further obligation to Tenant as to 
     the condition of the Pad. Without limiting the generality of the 
     foregoing, Tenant agrees that Landlord shall have no obligation to 
     perform any further grading, demolition, compaction, or other site 
     preparations other than is set forth in the Lease and this Exhibit "C",
     nor shall landlord have any further obligation with regard to the 
     installation of any utilities or for the payment of any assessments, 
     connection fees, usage fees or hook-up fees. Except as expressly set 
     forth in this Lease, Landlord makes no representation or warranty of any 
     kind, whether at the present time or at any time in the future, with 
     regard to the condition of the Pad, the fitness or acceptability of the 
     Pad for any particular purpose, the condition of the soil, the 
     suitability of the Tenant Improvements to be placed upon the Pad, or the 
     ability of the Pad to support the Tenant Improvements, all such 
     representations and warranties, express or implied, whether by operation 
     of law or otherwise, being hereby expressly disclaimed by Landlord, and 
     Tenant assumes all risk, cost and expense with regard thereto. Without 
     in any way limiting the generality of the foregoing, Tenant shall, upon 
     commencing construction on the Pad, be deemed conclusively to have 
     inspected and investigated the Pad and to have accepted the Pad in an 
     "as is" condition.

a.   Landlord's Site Improvements Necessary for Tenant to Commence 
     Construction of the Tenant Improvements.

         (i) Access shall be provided to Tenant's Pad for construction 
     purposes, but strictly in accordance with the routes identified on 
     Exhibit "D-1" for construction traffic;

         (ii) Utilities shall be installed by Landlord to a point at the 
     Building Limit Line for each utility as identified on the Plans and 
     Specifications;

         (iii) Utility locations shall be staked and identified on the Pad, 
     and shall be illustrated by Landlord on a copy of the Site Plan provided 
     to Tenant; and

         (iv) Deliver the Pad to Tenant graded to within two-tenths (2/10) of 
     one foot (1') of the finished grade elevation per Landlord's grading 
     plan (which grading has already been completed) and at ninety percent 
     (90%) compaction of the Pad in accordance with the soils report and the 
     soils engineer of record, which report has been approved by the City of 
     Westminster. To confirm such grading and compaction, and before Landlord 
     may deliver the Pad to Tenant, Landlord must first provide Tenant with a 
     Pad grading certification and as oils compaction certification and five 
     (5) business days to reasonably approve or disapprove such 
     certifications in writing. During such five (5) business days, and 
     provided Tenant has first provided Landlord with its requisite insurance 
     certificate as required by Paragraph 6b, below. Tenant may have access 
     to the Pad to do such testing and inspections reasonably necessary to 
     confirm the information in such certifications. If Tenant fails to give 
     Landlord notice of approval or disapproval, Tenant shall be deemed to 
     have approved the certifications and Lord may deliver the Pad to Tenant. 
     If Tenant reasonably disapproves the certifications, Tenant shall state 
     with specificity in its written notice of disapproval the condition that 
     does not match the certification and Landlord shall promptly take all 
     reasonable steps to correct the non-complying condition.

     b.   Landlord's Site Improvements Necessary for Tenant to Open the 
     Premises for Business. Substantial completion of all Common Areas or 
     Site Improvements in and around the Premises, in accordance with the 
     Site Plan as shown on Exhibit "A-2" and Exhibit "D" to the Lease, and 
     applicable conditions to governmental approval of the Site Plan. Common 
     Areas Improvements are all curbs, gutters, paving, striping, landscaping 
     and irrigation systems, storm drainage, retaining walls, driveways, 
     walkways, driveway aprons, and lighting facilities, Shopping Center 
     driveway and landscaping. In no event shall Common Areas Improvements or 
     Site Improvements include any curb face of sidewalks around the 
     perimeter of Tenant's Building or any improvements within five (5) feet 
     of all wall, yard enclosure, or canopy or roof overhang "drip" line of 
     Tenant's Building, all of which shall be Tenant's sole responsibility. 
     Upon Tenant's commencement of Tenant's Building construction, Tenant 
     shall notify Landlord of Tenant's projected opening date so as to allow 
     Landlord 


                                  Page 4 of 7



<PAGE>

     to schedule and timely complete Landlord's Site Improvements. Landlord 
     shall use reasonable efforts to ensure that paved delivery truck access 
     is available to the Premises at lease ninety (90) days before Tenant's 
     projected opening and that the remainder of the Common Areas and Site 
     Improvements are completed at lease thirty (30) days before Tenant's 
     projected opening.

     c.   Tenant Contribution to Site Improvements and Common Areas 
     Improvements. Tenant shall pay to Landlord's Tenant's pro rata share of 
     the cost of Site Improvements and Common Areas Improvements on the 
     Premises in an amount equal to $4.00 per square foot of the Premises. 
     Tenant shall pay Landlord its pro rata share within five (5) working 
     days after receipt of written notice from the Landlord's confirming that 
     the first permit for Tenant's construction of the Tenant Building is 
     available to be issued.

5.   Pre-Construction Obligations of Tenant.

     a.   Site Certification. Within seven (7) days after the last to occur 
     of the date of the delivery of the possession of the Pad to the Tenant 
     pursuant to Paragraph 4 hereof or the date of the approval of the 
     Working Drawings and Specifications, Tenant shall cause, at its sole 
     cost and expense, the corners of the Tenant Improvements to be set on 
     the Pad by a licensed land surveyor. Tenant shall notify Landlord when 
     the corners are set. Landlord shall confirm Landlord's acceptance of the 
     corner staking in writing to Tenant. Notwithstanding anything to the 
     contrary contained herein, Landlord shall not be liable to Tenant for 
     any errors or omissions made in the setting of corners.

     b.   Governmental Approvals of Plans and Specifications. Tenant shall, 
     at its sole cost and expense, comply with all applicable laws, 
     ordinances, governmental rules, regulations and permits pertaining to 
     governmental approvals of the Working Drawings and Specifications. 
     Tenant shall, within fifteen (15) days thereafter, cause the Working 
     Drawings and Specifications to be revised to make such change and shall 
     submit two (2) sets of such drawings and specifications, as revised, to 
     Landlord. Landlord shall initial and date one (1) set of such Working 
     Drawings and Specifications containing the revisions required by any 
     governmental agency and return one set to Tenant. Within forty-five (45) 
     days after receipt of all governmental approvals for Tenant's intended 
     project, Tenant shall submit and apply for all requisite permits for 
     Tenant's Improvements and diligently pursue the issuance of all such 
     permits.

6.   Construction Contract and Commencement of Construction.

     a.   Construction Contract.

          (i)   Tenant shall enter into a construction contract with a duly 
     licensed contractor reasonably acceptable to Landlord for completion of 
     Tenant's Improvements on the Premises. Landlord may require that any 
     contractor is bondable with a surety satisfactory to Landlord in an 
     amount sufficient to insure complete and timely construction of the 
     Tenant Improvements and prompt payment of all labor and materials. No 
     bond, however, shall be required.

          (ii)  Tenant shall coordinate its construction on the Pad with 
     other construction work being performed or to be performed by the 
     Landlord on the Premises or elsewhere in the Shopping Center. Tenants 
     shall ensure that its contractor will agree to cooperate with Landlord 
     in coordinating all construction on the Premises and the Shopping 
     Center. Tenant acknowledges that the Shopping Center will be in 
     operation at the time of Tenant's construction and that Tenant may not 
     interfere with the operation of the Shopping Center or of any of its 
     tenants. Tenant's construction areas bordering the east, west, and north 
     sides of the Pad and as delineated on Exhibit "D-1" to the Lease (the 
     "Primary Construction Areas") shall be fenced in and Tenant shall 
     endeavor to the greatest extent possible to minimize the impact of its 
     construction on the operation of the Shopping Center. Tenant agrees to 
     comply with the Primary Construction Areas made available to Tenant for 
     the staging, storage, parking of construction vehicles, and the routes 
     of access for all construction traffic, as well as for location of any 
     field office or other facilities for contractor's personnel, all as 
     delineated on Exhibit "D-1" to the Lease. Exhibit "D-1" also identifies 
     certain additional parking areas outside of the Primary Construction 
     Areas at the northern end of the Shopping Center and to the east of the 
     Pad (which additional areas are collectively referred to as the 
     "Tentative Additional Construction Areas") which, subject to Landlord's 
     approval not to be unreasonably withheld or delayed, may also be used by 
     Tenant on a limited, "as-needed" basis if the Primary Construction Areas 
     prove to be insufficient for Tenant's staging and storing of 
     construction materials, provided that such additional areas are, like 
     the Primary Construction Areas, kept fenced and used so as to minimize 
     the impact of its construction on the operation of the Shopping Center. 
     Any areas which Tenant desires to use outside of the 


                                  Page 5 of 7


<PAGE>

     Primary Construction Areas and the Tentative Additional Construction 
     Areas are subject to Landlord's prior written approval, which may be 
     withheld in Landlord's sole and absolute discretion.

          (iii) Tenant's contractor and all subcontractors shall be licensed 
     by the State of California and the County of Los Angeles for the work to 
     be performed by such contractor or subcontractors and shall be required 
     to perform all work in a thoroughly first class and workerlike manner in 
     strict conformance with the Working Drawings and Specifications. 
     Tenant's contractor and all subcontractors shall be required to obtain 
     approval (as set forth in Paragraph 6a(ii), above) from Landlord for any 
     space outside of the fenced Primary Construction Areas but in the 
     Shopping Center generally, which is needed for storage, handling and 
     moving of materials and equipment, as well as for location of any field 
     office or other facilities for contractor's personnel (which approval, 
     except as set forth in Paragraph 6a(ii) as to the staging, storage, and 
     access routes delineated on Exhibit "D-1" to the Lease, may be withheld 
     in Landlord's sole discretion). Parking of construction vehicles within 
     the Shopping Center other than within the Primary Construction Areas 
     shall be strictly prohibited, and access of such vehicles over the 
     Shopping Center to and from the Primary Construction Areas shall be as 
     directed by Landlord on Exhibit "D-1". Tenant's contractor or 
     subcontractors shall be required to make appropriate arrangements with 
     Landlord for temporary utility connections as may be available within 
     the Shopping Center generally, and shall pay the cost of such 
     connections, including the cost of maintenance and removal thereof, and 
     shall pay all utility charges incurred. The construction contract shall 
     also provide that the contractor and all subcontractors shall work in a 
     cooperative spirit with Landlord's site work superintendent.

          (iv)  Tenant's contractor and all subcontractors shall carry 
     Workers Compensation Insurance covering all of their respective 
     employees, as well as Commercial Liability Insurance, including 
     replacement coverage property damage, and Comprehensive Automobile 
     Liability Insurance. Tenant's contractor shall also carry Builder's All 
     Risk Insurance. All such liability insurance shall provide single limit 
     coverage of at least Two Million Dollars ($2,000,000) for Tenant's 
     contractor (except for Worker's Compensation, which shall have limits as 
     provided by law), and shall be in a form, and carried by companies, 
     approved by Landlord. All insurance shall contain provisions prohibiting 
     cancellation or reduction in coverage prior to the giving of at least 
     thirty (30) days prior written notice to Landlord. All insurance shall 
     name Tenant as the named insured and shall also name Landlord, Master 
     Landlord, and Landlord's Lender (if any) as an additional insureds.

     b.   Commencement of Construction. Prior to the commencement of any 
     construction, Tenant shall provide Landlord with certificates of 
     insurance evidencing insurance coverage required to be carried by Tenant 
     under the terms of the Lease, and by Tenant and the contractor under the 
     terms of this Exhibit "C". Thereupon, Tenant shall promptly commence 
     construction of the Tenant Improvements pursuant to the provisions of 
     the construction contract. Notwithstanding the fact that Landlord has 
     completed the site preparation work described in Paragraph 4 hereof 
     prior to the execution of the construction contract and the delivery of 
     such insurance certificates, only after the delivery of such insurance 
     certificates shall Tenant be entitled to have possession of the Pad and 
     cause the construction of the Tenant Improvements to be located on the 
     pad to be commended and completed by the contractor pursuant to the 
     provisions of the construction contract.

7.   Completion of Construction. Tenant shall diligently prosecute 
     construction of the Tenant Improvements until completion. Within one 
     hundred eighty (180) days after the commencement of construction of the 
     Tenant Improvements (subject to delays caused by "force majeure" as 
     defined below), Tenant shall cause the construction to be completed in 
     strict accordance with the Plans and Specifications. Landlord shall have 
     no obligation to Tenant with regard to the design, quality of 
     construction, utility, or otherwise, of the Plans and Specifications, or 
     any modifications thereto or deviations therefrom, nor shall Landlord 
     have any obligation to construct the Tenant Improvements, or any portion 
     thereof.

8.   Damage During Construction. Tenant acknowledges that the time Tenant 
     commences its construction of the Tenant's Improvements, portions of the 
     Shopping Center will already be complete and in use, including without 
     limitation driveways and other hardscape and landscaping. Tenant agrees 
     to use all reasonable efforts to ensure that no damage is caused to any 
     portion of the Shopping Center by virtue of the performance of the 
     Tenant's Improvements. Tenant shall be responsible for the cost of 
     repair or replacement of any items at the Shopping Center damaged or 
     destroyed provided such damage or destruction is attributable to Tenant 
     or Tenant's agents, employees, contractors, or subcontractors during or 
     in connection with the performance of the Tenant's work hereunder.

9.   Requirements for Contractors or Subcontractors.

     a.   Construction of the Tenant Improvements shall be performed in a 
     thoroughly first class and workerlike manner and in strict conformity 
     with the approved Working Drawings and Specifications, and shall be in 
     good and useable condition and repair at the date of completion. 
     Landlord's on-site


                                  Page 6 of 7


<PAGE>

     representative shall be provided at all times with a current schedule of 
     Tenant's construction work and shall be invited to attend all job site 
     meetings (and provide with adequate notice of same).

     b.   Tenant's contractor shall be required to pay for all necessary 
     permits and/or fees with respect to the Tenant's Improvements.

     c.   The contractor, and all subcontractors, shall be required to move 
     and dispose of, at lease once a week and more frequently as Landlord may 
     direct, all debris and rubbish caused by or resulting from construction, 
     and upon completion of the Tenant Improvements, shall remove all 
     temporary structures, surplus materials, debris and rubbish of whatever 
     kind remaining in or on the Premises, the Building, the Pad, or within 
     the Shopping Center generally, which had been brought in as an adjunct 
     of, or created in the performance of, the construction of the Tenant 
     Improvements. Should Tenant or Tenant's contractor have an excess of 
     dirt on the site once Tenant has finished all of its fine grading, 
     Tenant shall, at its sole cost and expense, cause such excess dirt to be 
     removed. If after the completion of all of Tenant's Improvements, as 
     determined solely by Tenant, the contractor or any subcontractor shall 
     neglect, refuse, or fail to remove any such debris, rubbish, surplus 
     materials, or temporary structures within two (2) days after notice to 
     Tenant from Landlord, Landlord may cause the same to be removed by 
     contract or otherwise as Landlord may determine expedient, and charge 
     the cost thereof to Tenant, which amount shall be reimbursed by Tenant 
     to Landlord, as additional rent, upon demand therefor by Landlord.

     d.   Landlord shall have no responsibility for any loss or damage to any 
     of Tenant's property or any property of the contractor, and all 
     subcontractors, installed or left in or on the Premises, the Building, 
     the Pad or the Shopping Center, and Tenant shall indemnify, defend, and 
     hold Landlord harmless from any and all claims, demands, debts, 
     liabilities, causes of action, costs or expenses, including without 
     limitation attorney's fees, which Landlord may sustain (or which may be 
     alleged against Landlord) in connection with the construction activities 
     for the Tenant Improvements.

10.  Utilities. Landlord shall obtain all approvals with respect to any and 
     all electrical, gas, water, telephone and other utility work as may be 
     required by the utility company supplying utilities to Tenant's Pad. 
     Tenant shall install all requisite connections to such utilities and 
     shall obtain utility service, including meters, from the utility company 
     supplying service.

11.  Force Majeure. If the date for the completion of an obligation of either 
     Landlord or Tenant hereunder is delayed at any time by labor disputes, 
     fire, unusual delays in transportation or materials, adverse weather 
     conditions which could not be reasonably anticipated, unavoidable 
     casualties, delays caused by governmental authorities or the inability 
     to obtain required governmental approvals or other causes beyond the 
     control of such party or by any other unavoidable causes (other than 
     lack of funds), then the date of completion for such obligation shall be 
     extended (but not excused) by the period of time taken by any such delay.

12.  Intentionally Omitted.

13 . Intentionally Omitted.

14.  Ownership of Tenant Improvements. Notwithstanding any other provision of 
     the Lease, title to all of the Tenant Improvements, whether under 
     construction or completed, and all alterations, improvements and 
     additions thereto, excluding "Tenant's Property" (as defined in 
     Paragraph 12.1), shall vest in Landlord upon expiration or termination 
     of the Lease, and Tenant shall have no rights thereto or interest 
     therein (except for Tenant's leasehold interest under this Lease).

15.  Signing and Fixturization. Either at such time prior to completion of 
     the Tenant Improvements as may be convenient, or promptly upon 
     completion of the Tenant Improvements, Tenant shall, at Tenant's cost 
     and expense, and without any reimbursement therefor, or payment or 
     contribution on account thereof by Landlord, place or install, or cause 
     to be placed or installed, in and upon the Premises, such equipment, 
     partitions, furniture and fixtures as Tenant, in Tenant's sole 
     discretion, shall deem necessary or appropriate for the purpose of 
     carrying on Tenant's business on the Premises; provided, however, that 
     in any event such equipment, furniture, partitions and fixtures shall be 
     sufficient to make the Premises suitable for the purposes intended, and 
     shall be such so as to enable Tenant to obtain a Certificate of 
     Occupancy covering the Premises. All exterior signs will be subject to 
     compliance with applicable local ordinances and the Declaration and 
     shall otherwise be subject to the terms of the Lease (including, without 
     limitation, the exclusion contained in Section 2 of this Exhibit "C").


                                  Page 7 of 7



<PAGE>

                                  EXHIBIT "D"

                      WESTMINSTER GATEWAY SHOPPING CENTER

                             PLOT PLAN OF PREMISES




















                                  EXHIBIT "D"




<PAGE>


                                  EXHIBIT D

                              PARTIAL PLOT PLAN

                                  [GRAPHIC]


<PAGE>

                                  EXHIBIT "E"

                            [INTENTIONALLY OMITTED]













                                  EXHIBIT "E"

<PAGE>

                                  EXHIBIT "F"

                      WESTMINSTER GATEWAY SHOPPING CENTER

                             SUPPLEMENTAL AGREEMENT

         THIS SUPPLEMENTAL AGREEMENT, made and agreed, as of the __________ 
day of __________, 19__, by and between FF PROPERTIES, L.P., a California 
limited partnership, hereinafter referred to as "Landlord", and EAGLE 
HARDWARE & GARDEN, INC., a Washington corporation, hereinafter referred to as 
"Tenant";

                                  WITNESSETH:

         The Landlord and Tenant entered into a certain lease dated as of 
March 5, 1998, covering certain Premises which are a portion of the Shopping 
Center, located in Westminster, California, as more particularly described in 
said Lease.

         NOW, THEREFORE, in consideration of the foregoing, the parties 
hereto hereby mutually agree as follows:

         1. For the purpose of confirming the establishment of the 
Commencement Date, as required by the provisions of Article 2, "Term", of 
said Lease, Landlord and Tenant hereby agree that:

            a.   The date of __________, 19__, is hereby established as the 
"Commencement Date" referred to in said lease, and

            b.   The date of __________, 19__, is hereby established as the 
"Expiration Date" of the term of said Lease.

         2. Tenant hereby confirms the following:

            a.   That it has accepted possession of the Premises pursuant to 
the terms of said Lease;

            b.   That the improvements required to be furnished by Landlord 
in accordance with Exhibit "C" to said lease have been completed;

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

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

------------------------------------------------------------------------------;

            e.   That there are no off-sets or credits against rentals; nor 
has any security deposit been paid except as provided by the Lease terms;

            f.   That said rentals commence to accrue on the ______ day of 
__________, 19__;

            g.   That Tenant has no notice of a prior assignment, 
hypothecation or pledge of rents or said Lease;

            h.   That said Lease is in full force and effect; and

            i.   The dates by which Tenant must, if at all, exercise its 
options to extend the term of the Lease are as follows:

                 First Option: (i)       _______________________________;
                 Second Option: (ii)     _______________________________; and
                 Third Option:           _______________________________.

            j.   That Tenant's Proportionate Share of Common Areas Operating 
Costs is __________ percent (____%), subject to adjustment as provided in 
Paragraph 4.2 of the Lease. 

                                 EXHIBIT "F"
                                 Page 1 of 2


<PAGE>

         3. This Supplemental Agreement, and each and all of the provisions 
hereof shall inure to the benefit, or bind, as the case may require, the 
parties hereto and their respective heirs, successors and assigns.

         IN WITNESS WHEREOF, the parties hereto have executed this instrument 
as of the day and year first above written.

         "LANDLORD";                 FF PROPERTIES, L.P.
                                         a California limited partnership

                                         By: Carnoustie, Inc.

                                             a California corporation,
                                             General Partner

                                         By: __________________________________
                                             Name: ____________________________
                                             Title: ___________________________

         "TENANT";                   EAGLE HARDWARE & GARDEN, INC.
                                     a Washington corporation

                                         By: __________________________________
                                             Name: ____________________________
                                             Title: ___________________________

                                         By: __________________________________
                                             Name: ____________________________
                                             Title: ___________________________





                                 EXHIBIT "F"
                                 Page 2 of 2





<PAGE>

                                 EXHIBIT "G"

                            INTENTIONALLY OMITTED













                                 EXHIBIT "G"


<PAGE>

                                 EXHIBIT "H"

                        FORM AMENDMENT TO DECLARATION















                                 EXHIBIT "H"





<PAGE>

Recorded at the request of:
Chicago Title Company
When recorded mail to:
FF Properties, L.P.
120 North Robertson Boulevard
Los Angeles, California 90048
Attention: J.G. Gillett, Esq.
--------------------------------------------------------------------------------
                                                         WESTMINSTER, CALIFORNIA

                    FIRST AMENDMENT TO AMENDED AND RESTATED
               DECLARATION OF COVENANTS, CONDITIONS, RESTRICTIONS
                            AND RECIPROCAL EASEMENTS

         THIS FIRST AMENDMENT TO THE AMENDED AND RESTATED DECLARATION OF 
COVENANTS, CONDITIONS, RESTRICTIONS AND RECIPROCAL, EASEMENTS ("Amendment") 
is executed this day   of     , 1998, by WAL-MART STORES, INC., a Delaware 
corporation, of 702 Southwest 8th Street, Bentonville, Arkansas 72716 
("Wal-Mart"), and FF PROPERTIES, L.P., a California limited partnership, of 
120 North Robertson Boulevard, Los Angeles, California 90048-3102 (the 
"Developer")

                                  WITNESSETH:

         WHEREAS, pursuant to that certain Amended and Restated Declaration of
Covenants, Conditions, Restrictions and Reciprocal Easements recorded August 12,
1997, as Instrument No. 19970385376 in the Office of the Clerk/Recorder of the
County of Orange, California ("Declaration"), Wal-Mart and Developer desire to
amend the Declaration in the particulars set forth below to facilitate the
development and leasing of the real property commonly know as Westminster
Gateway Shopping Center, the legal description of which is Lots 1 through 7 of
Tract Map No. 15514 in the City of Westminster, County of Orange, State of
California ("Project").

         NOW THEREFORE, for and in consideration of the covenants, conditions,
and restrictions contained herein, the sufficiency of which is hereby
acknowledged, Wal-Mart and Developer do hereby amend the Declaration for the
benefit of the Project and each Tract, Outparcel and Lot (as defined in the
Declaration) located therein for the benefit of the Developer, Wal-Mart, their
successors and assigns, and all subsequent owners of Tracts, Outparcels and Lots
within the Project and their respective heirs, successors, representatives and
assigns.

                                       1
<PAGE>

         IN CONSIDERATION OF THE FOREGOING, Developer and Wal-Mart hereby
covenant and agree as follows:

         1. All capitalized words in this Amendment shall have the same meaning
as those words defined in the Declaration, unless specifically modified herein.

         2. The Site Plan of the Project which is attached to the Declaration as
"Exhibit A" is hereby superseded in its entirety and the Site Plan attached
hereto and incorporated herein by this reference as "Exhibit A" shall be
substituted in lieu thereof. The parties hereof agree that all references in the
Declaration and Amendment to "Exhibit A" shall hereinafter be deemed to refer to
"Exhibit A" attached to this Amendment. "Exhibit A" has been revised to depict
the reconfiguration of Tract 2 and the Outparcels described in Paragraph 3
below, and to adjust the lot lines of Lots 1 and 4 of Tract 15514. The square
footage of Lot 1 of Tract 15514 shall remain unchanged.

         3. Tract Map No. 15514 referred to in Paragraph 1e. of the Declaration
was recorded on December 17, 1997, as Instrument No. 970651234, in Book 760,
Pages 24-29, in the Office of the Clerk/Recorder of the County of Orange,
California. If Tract 2 is developed in accordance with Exhibit A, the fourth,
fifth and sixth grammatical sentences of Paragraph 1e. of the Declaration are
deleted in their entirety and the following sentences inserted therein:

         "For informational purposes only, the property identified herein as
         Tract 1 shall become Lot 1 of Tract 15514; the property identified
         herein as Tract 2 shall become Lots 2, 3, 4 and 5 of Tract 15514; the
         references herein to Outparcels A and B shall be deleted; the property
         identified herein as Outparcel C shall become Lot 6 of Tract 15514; and
         the property identified herein as Outparcel D shall become Lot 7 of
         Tract 15514. The term "Tracts" shall mean and collectively refer to Lot
         1, and Lots 2, 3, 4, and 5 of Tracts 15514. The term "Outparcels" shall
         mean and collectively refer to Lots 6 and 7 of Tract 15514."

         4. The Site Plan of the Project which is attached to the Declaration as
"Exhibit A-1" is hereby superseded in its entirety and the Site Plan attached
hereto and incorporated herein by this reference as "Exhibit A-1" shall be
substituted in lieu thereof. The parties hereto agree that all references in the
Declaration and Amendment to "Exhibit A-1" shall hereinafter be deemed to refer
to "Exhibit A-1" attached to this Amendment. In the event the Project is
developed in accordance with Exhibit A-1, the fourth, fifth, and sixth
grammatical sentences of Paragraph 1e. of the Declaration are deleted in their
entirety and the following sentences inserted therein:

                                       2
<PAGE>

         "The property identified herein as Tract 1 is Lot 1 of Tract 15514; the
         property identified herein as Tract 2 is Lot 2 and Lot 3 of Tract
         15514; the property identified herein as Outparcel A is Lot 4 of Tract
         15514; the property identified herein as Outparcel B is Lot 5 of Tract
         15514; the property identified herein as Outparcel C is Lot 6 of Tract
         15514; and the property identified herein Outparcel D is Lot 7 of Tract
         15514. The term "Tracts" shall mean and collectively refer to Lot 1,
         and Lots 2 and 3 of Tract 15514. The term "Outparcels" shall mean and
         collectively refer to Lots 4, 5, 6 and 7 of Tract 15514."

         5. The fourth grammatical sentence of Paragraph 3(b) of the Declaration
is hereby deleted in its entirety and the following sentences is inserted
therein:

         "In the event that a building for any use other than a theater or
         cinema is constructed upon Tract 2, and such building shall contain
         more than Ten Thousand (10,000) square feet, no main entrance or other
         customer entrance for such building, store or business located on Tract
         2 shall be located within less than ninety (90) feet of the northern
         boundary of the Building Area of Tract 1."

         6. In the first grammatical sentence of Paragraph 5a(ll) of the
Declaration, the words ". . . five and one-half (5.5) car spaces for each one
thousand (1,000) square feet of Building Area on such Tract . . ." are hereby
deleted in their intirety and the following words are inserted therein: " . . .
five and thirteen-hundredths (5.13) car spaces for each one thousand (1,000)
square feet of Building Area on such Tract . . . "

         7. The introductory paragraph of Paragraph 7.b. of the Declaration is
hereby deleted in its entirety and the following paragraph is inserted therein:

         "b. Insurance. Subject to the terms and conditions hereinafter set
forth in this Section 7, each Party shall procure and maintain, or cause to be
procured and maintained, in full force and effect throughout the term of this
Declaration the following types of insurance: . . . "

         8. Paragraph 7.b.(i) of the Declaration is deleted in its entirety and
the following paragraph is inserted therein:

         "(I) Commercial general liability insurance with coverage limits not
         less than Five Million Dollars ($5,000,000.00) combined single limit
         bodily injury, personal injury, death and property damage liability per
         occurrence, with a commercially reasonable deductible amount per
         occurrence as determined by Wal-Mart and Developer, insuring against

                                       3
<PAGE>

         any and all scheduled liability of the insureds with respect to its
         Tract (or portion thereof owned or leased by said Party) or Outparcel,
         as the case may be, or arising out of the maintenance, use or occupancy
         of said Party's Tract or Outparcel and all areas appurtenant thereto,
         or related to the exercise of any rights of a Party pursuant to this
         Declaration. The coverage limits of the commercial general liability
         insurance and the deductible amounts referenced above shall be subject
         to increases in amount as Wal-Mart and Developer may mutually and
         reasonably require from time to time. As of the date of this Amendment,
         a deductible amount of not more than Fifty Thousand Dollars
         ($50,000.00) shall be deemed to be commercially reasonable. All such
         commercial liability insurance shall specifically insure the
         performance by a Party of the indemnity agreement as to liability for
         injury to or death of persons and injury or damage to property as set
         forth in Section 7.a. above. Further, all commercial liability
         insurance shall include, but not be limited to, personal injury, cross
         liability and severability of interest clauses, products/completed
         operations, broad form property damage, independent contractors, owned,
         non-owned and hired vehicles and, if alcoholic beverages are served,
         sold, consumed or obtained in the Tract or Outparcel, as applicable,
         liquor liability."

         9. Paragraph 7.c. of the Declaration is hereby deleted in its entirety
and the following paragraph is inserted therein:

         "c. Additional Insured. All policies of insurance required to be
maintained by each Party under Section 7.b.(i) shall name Developer, Wal-Mart,
Eagle Hardware & Garden, Inc. ("Eagle"), and Ground Lessor as additional
insureds. All policies of insurance must also contain a provision that the
company writing the policy will give to Developer thirty (30) days notice in
writing in advance of any cancellation or lapse of the effective date or any
reduction in the amounts of insurance. Upon written request, each Party shall
provide to the requesting Party certificates of insurance evidencing that all of
the insurance required by this Section 7 has been obtained and is in full force
and effect. All certificates shall have cancellation language on the face
thereof in accordance with this Section 7.c."

         10. Paragraph 15 of the Declaration is deleted in its entirety and the
following paragraph is inserted therein:

         "15. Document Execution, Modification and Cancellation. This
         Declaration (including exhibits) may be amended or canceled only by the
         mutual agreement of (a) Wal-Mart as long as it or its affiliate has any
         interest as either owner, lessee subleases of Tract 1, (b) Developer as
         long as it has any interest as either owner or lessee of Tract 2 or the
         Outparcels, and (c) Eagle as long as it has any interest as owner or
         lessee of Tract 2. If Wal-Mart or its affiliate no longer has any
         interest in 

                                       4
<PAGE>

         Tract 1, such amendment or cancellation may only be made by the then
         owner of Tract 1, Eagle, and Developer or their respective successors
         as described in Section 14."

         11. Except as hereby expressly modified, all other terms and conditions
of the Declaration remain unchanged.

         IN WITNESS WHEREOF, we have hereunto set our hand and seal on the date
and year first above written.

                                DEVELOPER:
                                
                                FF PROPERTIES, L.P. a California limited
                                partnership
                                
                                By:    Carnoustie, Inc., General Partner
                                
                                By:
                                       ---------------------------------
                                By:     Ira S. Levin, Vice President
                                
                                By:
                                        ---------------------------------
                                By:     James D. Vandever, Vice President
                                
                                
                                
                                WAL-MART STORES, INC., a Delaware corporation

                                By:
                                        ----------------------------------
                                Its::
                                        ----------------------------------

                                       5
<PAGE>
             
         The Ground Lessor hereby executes this First Amendment to the
Declaration solely for the purpose of evidencing its consent to the terms and
conditions hereof as provided in Paragraph 31 of the Declaration.

                CALIFORNIA DRIVE-IN THEATRES, INC., a California corporation
                
                By:
                        --------------------------
                        Bradley J. Neel, Secretary
                
                By:
                        --------------------------
                Title:
                        --------------------------
                
                
                
                
STATE OF CALIFORNIA   )
                      ) SS.
COUNTY OF LOS ANGELES )
                
On _________ , 1998, before me, the undersigned, a Notary Public in and for 
said State, personally appeared _______________, personally known to me or 
proved to me on the basis of satisfactory evidence to be the person who 
executed the within instrument as the _______________ on behalf of the 
corporation therein named, and acknowledged to me that such corporation 
executed the within instrument pursuant to its by-laws or a resolution of its 
board of directors.

                             WITNESS my hand and official seal.



                             -----------------------------------
                             Notary Public in and for said State


                                       6
<PAGE>



STATE OF CALIFORNIA     )
                        ) SS.
COUNTY OF LOS ANGELES   )

         On ___________, 1998, before me, the undersigned, a Notary Public in 
and for said State, personally appeared ___________, personally known to me 
or proved to me on the basis of satisfactory evidence to be the person who 
executed the within instrument as the ___________ on behalf of the 
corporation therein named, and acknowledged to me that such corporation 
executed the within instrument pursuant to its by-laws or a resolution of its 
board of directors.


                              WITNESS my hand and official seal.


                              -----------------------------------
                              Notary Public in and for said State



STATE OF ARKANSAS       )
                        ) SS.
COUNTY OF               )

         On ___________ , 1998, before me, the undersigned, a Notary Public 
in and for said State, personally appeared ___________, personally known to 
me or proved to me on the basis of satisfactory evidence to be the person who 
executed the within instrument as the _____________ on behalf of the 
corporation therein named, and acknowledged to me that such corporation 
executed the within instrument pursuant to its by-laws or a resolution of its 
board of directors.

                             WITNESS my hand and official seal.


                             -----------------------------------
                             Notary Public in and for said state

                                       7

<PAGE>

STATE OF ARKANSAS          )
                           ) SS.
COUNTY OF __________       )

         On _________, 1998, before me , the undersigned, a Notary Public in 
and for said State, personally appeared ____________, personally known to me 
or proved to me on the basis of satisfactory evidence to be the person who 
executed the within instrument as the _____________on behalf of the 
corporation therein named, and acknowledged to me that such corporation 
executed the within instrument pursuant to its by-laws or a resolution of its 
board of directors.


                            WITNESS my hand and official seal.



                            -----------------------------------
                            Notary Public in and for said State


                                       8

<PAGE>



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