10-Q

                                                      FORM 10-Q

                                         SECURITIES AND EXCHANGE COMMISSION
                                               Washington, D.C.  20549


[X]      QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
         For the quarterly period ended December 31, 2000


[   ]    TRANSITION REPORT UNDER SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934


Commission file number:  0-24126



                                               FRONTIER AIRLINES, INC.
                                               -----------------------
                               (Exact name of registrant as specified in its charter)



                                      Colorado                                             84-1256945
- --------------------------------------------------------------------------------------------------------------------------
 (State or other jurisdiction of incorporated or organization)               (I.R.S. Employer Identification No.)


                 7001 Tower Road,  Denver, CO                                               80249
               --------------------------------                                          -------------
           (Address of principal executive offices)                                       (Zip Code)


Issuer's telephone number including area code:  (720) 374-4200


Indicate by check mark whether the registrant  (1) has filed all reports  required to be filed by Section 13 or
15(d) of the  Securities  Exchange Act of 1934 during the preceding 12 months (or for such shorter  period that
the  registrant was required to file such reports),  and (2) has been subject to such filing  requirements  for
the past 90 days.  Yes  X   No
                       ---     -----


The number of shares of the Company's Common Stock outstanding as of February 6, 2001 was 18,674,310.









                                                  TABLE OF CONTENTS

                                         PART I. FINANCIAL INFORMATION


                                                                                                           Page
                                                                                                           ----

Item 1.  Financial Information

         Financial Statements                                                                                 1


Item 2.  Management's Discussion and Analysis of Financial Condition and
         Results of Operations                                                                                7

Item 3:  Quantitative and Qualitative Disclosures About Market Risk                                          16




                                               PART II. OTHER INFORMATION


Item 5.  Other Information                                                                                   18

Item 6.  Exhibits and Reports on Form 8-K                                                                    18








                                         PART I. FINANCIAL INFORMATION

Item 1. Financial Statements
FRONTIER AIRLINES, INC.
Balance Sheets
(Unaudited)
                                                                               December 31,      March 31,
                                                                                   2000            2000
                                                                             ---------------------------------
Assets
- ------
Current assets:
    Cash and cash equivalents                                                   $ 104,275,276    $ 67,850,933
    Short-term investments                                                          2,000,000      15,760,000
    Restricted investments                                                          5,000,000       4,000,000
    Trade receivables, net of allowance for doubtful accounts of $342,951
      and $170,819 at December 31 and March 31, 2000, respectively                 18,392,271      22,190,835
    Maintenance deposits                                                           27,591,167      19,637,128
    Prepaid expenses and other assets                                               7,214,043       7,386,851
    Inventories                                                                     3,368,112       2,235,183
    Deferred tax assets                                                             1,583,812       1,136,194
    Deferred lease expense                                                             82,214         163,527
                                                                             ---------------------------------
            Total current assets                                                  169,506,895     140,360,651
Security, maintenance and other deposits                                           38,222,409      17,613,122
Property and equipment, net                                                        28,590,293      21,654,262
Deferred lease and other expenses                                                      62,910         104,243
Restricted investments                                                             12,026,660       7,813,760
                                                                             ---------------------------------
                                                                               $  248,409,167   $ 187,546,038
                                                                             =================================
Liabilities and Stockholders' Equity
- ------------------------------------
Current liabilities:
    Accounts payable                                                           $   10,435,331   $  14,407,913
    Air traffic liability                                                          39,716,040      44,518,837
    Other accrued expenses                                                         15,815,475      12,058,755
    Income taxes payable                                                            8,248,063       5,483,264
    Accrued maintenance expense                                                    31,018,751      21,893,316
    Current portion of obligations under capital leases                               122,274         113,029
                                                                             ---------------------------------
            Total current liabilities                                             105,355,934      98,475,114
Accrued maintenance expense                                                        10,418,179       7,214,167
Deferred tax liability                                                                447,049         483,514
Obligations under capital leases, excluding current portion                           236,333         328,702
                                                                             ---------------------------------
            Total liabilities                                                     116,457,495     106,501,497
                                                                             ---------------------------------

Stockholders' equity:
    Preferred stock, no par value, authorized 1,000,000 shares;
        none issued                                                                 -                -
    Common stock, no par value, stated value of $.001 per share,
        authorized 40,000,000 shares; 18,208,381 and 17,732,273 shares
        issued and outstanding at December 31 and March 31, 2000, respectively         18,208          17,732
    Additional paid-in capital                                                     73,284,951      67,946,230
    Unearned ESOP shares                                                           (2,216,250)       (857,713)
    Retained earnings                                                              60,864,763      13,938,292
                                                                             ---------------------------------
            Total stockholders' equity                                            131,951,672      81,044,541
                                                                             ---------------------------------
                                                                                $ 248,409,167   $ 187,546,038
                                                                             =================================
See accompanying notes to financial statements.


FRONTIER AIRLINES, INC.
Statements of Income
(Unaudited)
                                                   Three Months Ended               Nine Months Ended
                                             December 31,     December 31,     December 31,    December 31,
                                                 2000             1999             2000            1999
                                            ---------------- -------------------------------------------------
Revenues:

    Passenger                                $  111,318,875   $   71,663,224   $  350,690,244  $  231,050,921
    Cargo                                         2,102,347        1,767,542        5,374,595       4,686,118
    Other                                           790,814          543,143        2,038,819       1,576,332
                                            ---------------- -------------------------------------------------

            Total revenues                      114,212,036       73,973,909      358,103,658     237,313,371
                                            ---------------- -------------------------------------------------

Operating expenses:

    Flight operations                            48,003,293       32,338,722      132,090,129      88,599,352
    Aircraft and traffic servicing               15,279,898       12,438,953       43,768,413      35,309,736
    Maintenance                                  15,926,512       10,836,699       48,517,172      36,883,441
    Promotion and sales                          13,220,744        9,991,341       41,041,610      34,218,130
    General and administrative                    5,738,402        3,577,780       18,383,889      11,436,318
    Depreciation and amortization                 1,380,767          780,732        3,673,549       1,988,384
                                            ---------------- -------------------------------------------------

            Total operating expenses             99,549,616       69,964,227      287,474,762     208,435,361
                                            ---------------- -------------------------------------------------

            Operating income                     14,662,420        4,009,682       70,628,896      28,878,010
                                            ---------------- -------------------------------------------------

Nonoperating income (expense):
    Interest income                               2,229,031        1,172,868        6,001,629       3,119,990
    Interest expense                               (20,856)         (46,599)         (55,806)        (94,615)
    Other, net                                     (10,508)         (70,435)         (47,709)        (55,414)
                                            ---------------- -------------------------------------------------

            Total nonoperating income, net        2,197,667        1,055,834        5,898,114       2,969,961
                                            ---------------- -------------------------------------------------

Income before income tax expense and
    cumulative effect of change in method
    of accounting for maintenance checks         16,860,087        5,065,516       76,527,010      31,847,971

Income tax expense                                6,575,434        1,970,135       29,600,539      12,271,504
                                            ---------------- -------------------------------------------------

Income before cumulative effect of
  change in accounting principle                 10,284,653        3,095,381       46,926,471      19,576,467

Cumulative effect of change in method of
  accounting for maintenance checks                       -                - -                        549,009

                                            ---------------- -------------------------------------------------
Net income                                $      10,284,653$       3,095,381$      46,926,471$     20,125,476
                                            ================ =================================================

(continued)


FRONTIER AIRLINES, INC.
Statements of Income, continued
(Unaudited)

                                                   Three Months Ended               Nine Months Ended
                                             December 31,     December 31,     December 31,    December 31,
                                                 2000             1999             2000            1999
                                            ---------------- -------------------------------------------------
Earnings per share:
  Basic:
    Income before cumulative effect of a    $        0.57    $        0.18     $       2.62    $       1.14
      change in accounting principle
    Cumulative effect of change in method
      of accounting for maintenance checks              -                -                -            0.03
                                            ---------------- ---------------- --------------- ----------------
     Net income                             $        0.57    $        0.18     $       2.62    $       1.17
                                            ================ ================ =============== ================

  Diluted:
    Income before cumulative effect of a
      change in accounting principle        $        0.52     $       0.16     $       2.41    $       1.04
    Cumulative effect of change in method
      of  accounting for maintenance checks             -                -                -            0.03
                                            ---------------- -------------------------------------------------
    Net income                              $        0.52     $       0.16     $       2.41    $       1.07
                                            ================ =================================================

Weighted average shares of
  common stock outstanding
            Basic                                18,124,114       17,585,736       17,929,482      17,195,012
                                            ================ =================================================
            Diluted                              19,845,386       19,053,879       19,434,445      18,778,260
                                            ================ =================================================


See accompanying notes to financial statements.

FRONTIER AIRLINES, INC.
Statements of Stockholders' Equity
For the Year Ended March 31, 2000 and the
 Nine Months Ended December 31, 2000



                                   Common Stock                                   Retained
                              ---------------------   Additional    Unearned      earnings        Total
                                             Stated     paid-in       ESOP      (accumulated   stockholders'
                                 Shares      value      capital      shares       deficit)        equity
                              -------------------------------------------------------------------------------

                              -------------------------------------------------------------------------------
Balances,
    March 31, 1999              16,141,172  $ 16,141  $58,054,844   $   (609,375) $(13,070,961) $  44,390,649
Exercise of common stock
    warrants                     1,147,726     1,148    4,758,969                                   4,760,117
Exercise of common stock
    options                        343,375       343      563,712                                     564,055
Tax benefit from exercises of
  common stock options and
  warrants                                              3,425,055                                   3,425,055
Contribution of common stock
  to employees stock
  ownership plan                   100,000       100    1,143,650     (1,143,750)                         -
Amortization of employee stock
  compensation                                                           895,412                      895,412
Net income                                                                          27,009,253     27,009,253
                              -------------------------------------------------------------------------------
Balances,
    March 31, 2000              17,732,273  $ 17,732  $67,946,230    $  (857,713) $ 13,938,292   $ 81,044,541

Exercise of common stock
    warrants                        21,755        22       75,147                                      75,169
Exercise of common stock
    options                        454,353       364      934,831                                     935,195
Tax benefit from exercises of
  common stock options and
  warrants                                              2,112,583                                   2,112,583
Contribution of common stock
  to employees stock
  ownership plan                                  90    2,216,160     (2,216,250)                        -
Amortization of employee stock
  compensation                                                           857,713                      857,713
Net income                                                                          46,926,471     46,926,471

Balances,                     -------------------------------------------------------------------------------
    December 31, 2000           18,208,381  $ 18,208  $73,284,951    $(2,216,250) $ 60,864,763  $ 131,951,672
                              ===============================================================================

See accompanying notes to financial statements.

FRONTIER AIRLINES, INC.
Statements of Cash Flows
For the Nine Months Ended December 31, 2000 and 1999
(Unaudited)

                                                                                   2000            1999
                                                                             ---------------------------------
Cash flows from operating activities:

    Net income                                                                 $   46,926,471   $  20,125,476
    Adjustments to reconcile net income to net cash
        provided by operating activities:
            Employee stock option plan compensation expense                           857,713         609,375
            Depreciation and amortization                                           3,796,195       2,210,930
            Deferred tax (benefit) expense                                           (484,083)      6,310,948
            Changes in operating assets and liabilities:
                Restricted investments                                             (1,632,400)        500,000
                Trade receivables                                                   3,798,564       4,781,956
                Security, maintenance and other deposits                          (12,131,674)     (4,867,552)
                Prepaid expenses and other assets                                     172,808      (1,136,084)                                172,808 (1,136,084)
                Inventories                                                        (1,132,929)       (944,428)
                Accounts payable                                                   (3,972,582)     (2,709,716)
                Air traffic liability                                              (4,802,797)     (1,354,597)
                Other accrued expenses                                              3,756,720         202,079
                Income taxes payable                                                4,877,382       3,043,930
                Accrued maintenance                                                12,329,447       4,709,028
                                                                             --------------------------------
                     Net cash provided by operating activities                     52,358,835      31,481,345
                                                                             --------------------------------

Cash flows from investing activities:
    Decrease (increase) in short-term investments                                  13,760,000     (18,260,000)
    Aircraft lease and purchase deposits, net                                     (16,431,652)         59,039)
    Increase in restricted investments                                             (3,580,500)     (2,284,000)
    Capital expenditures                                                          (10,609,580)    (12,207,973)
                                                                             ---------------------------------
                     Net cash used by investing activities                        (16,861,732)    (33,011,012)
                                                                             ---------------------------------

Cash flows from financing activities:
    Net proceeds from issuance of common stock                                      1,010,364       5,163,328
    Principal payments on obligations under capital leases                            (83,124)        (73,734)
                                                                             ---------------------------------
                    Net cash provided by financing activities                         927,240       5,089,594
                                                                             ---------------------------------

                    Net increase in cash and cash equivalents                      36,424,343       3,559,927

Cash and cash equivalents, beginning of
period                                                                             67,850,933      47,289,072
                                                                             ---------------------------------


Cash and cash equivalents, end of period                                        $ 104,275,276   $  50,848,999
                                                                             =================================

See accompanying notes to financial statements.

FRONTIER AIRLINES, INC.
Notes to Financial Statements
December 31, 2000


(1)  Basis of Presentation

     The accompanying  unaudited financial  statements have been prepared in accordance with generally accepted  accounting  principles
     for interim  financial  information and the  instructions to Form 10-Q and Regulation  S-X.  Accordingly,  they do not include all
     of the  information and footnotes  required by generally  accepted  accounting  principles for complete  financial  statements and
     should be read in conjunction  with the Company's  Annual Report on Form 10-K for the year ended March 31, 2000. In the opinion of
     management,  all adjustments  (consisting only of normal recurring adjustments)  considered necessary for a fair presentation have
     been included.  The results of operations for the three and nine months ended December 31, 2000 are not necessarily  indicative of
     the results that will be realized for the full year.

(2)  Common Stock Transactions

     In April 1998, the Company issued a warrant to purchase  716,929 shares of the Company's Common Stock at a purchase price of $3.75
     per share.  In January 2001, the warrant  holder  purchased  366,929  shares of Common Stock under this warrant,  resulting in net
     proceeds to the Company of $1,375,984.










Item 2:  Management's Discussion and Analysis of Financial Condition and Results of Operations


This  report  contains  forward-looking  statements  within the  meaning of Section  21E of the  Securities  Exchange  Act of 1934 that
describe the business and prospects of Frontier  Airlines,  Inc.  ("Frontier" or the "Company") and the expectations of our Company and
management.  All statements,  other than statements of historical  facts,  included in this report that address  activities,  events or
developments that we expect, believe, intend or anticipate will or may occur in the future, are forward-looking  statements.  When used
in this document,  the words "estimate,"  "anticipate,"  "project,"  "expect," "plan" and similar  expressions are intended to identify
forward-looking  statements.  Forward-looking  statements are inherently  subject to risks and  uncertainties,  many of which cannot be
predicted with accuracy and some of which might not even be anticipated.  These risks and  uncertainties  include,  but are not limited
to: the timing of, and expense  associated  with,  expansion  and  modification  of our  operations  in  accordance  with our  business
strategy or in response to competitive  pressures or other factors such as our  commencement  of passenger  service and ground handling
operations at several  airports and assumption of maintenance and ground handling  operations at Denver  International  Airport ("DIA")
with our own employees;  general  economic  factors and behavior of the  fare-paying  public;  increased  federal  scrutiny of low-fare
carriers  generally that may increase our operating  costs or otherwise  adversely  affect us and the impact of current and future laws
and governmental  regulations  affecting the airline and travel industries and our operations;  actions of competing airlines,  such as
increasing  capacity and pricing actions of United Airlines and other  competitors;  the availability of suitable  aircraft,  which may
inhibit our ability to achieve operating  economies and implement our business strategy;  the unavailability of, or inability to secure
upon acceptable terms,  financing  necessary to purchase  aircraft which we have ordered;  costs associated with, and issues arising in
connection  with, our transition from a Boeing 737 fleet to an Airbus fleet;  our  relationship  with employees and the terms of future
collective bargaining  agreements;  and uncertainties  regarding aviation fuel prices.  Because our business,  like that of the airline
industry  generally,  is characterized by high fixed costs relative to revenues,  small fluctuations in our yield per revenue passenger
mile ("RPM") or expense per available seat mile ("ASM") can  significantly  affect  operating  results.  See "Risk Factors" in our Form
10-K for the year ended March 31, 2000 as they may be modified by the disclosures contained in this report.

General

       We are a scheduled  airline based in Denver,  Colorado.  In February 2001, we relocated our principal  executive offices to 7001
Tower Road, Denver, Colorado 80249.

       As of January 31, 2001,  we operate  routes  linking our Denver hub to 22 cities in 18 states  spanning the nation from coast to
coast.  We added Kansas  City,  Missouri to our route system on June 15, 2000,  and one daily  nonstop  flight to and from  Washington,
D.C.'s Ronald Reagan  International  Airport on September 7, 2000. On December 14, 2000, we added an additional daily round trip flight
to both Orlando, Florida and San Diego, California.

       We were  organized in February 1994 and we began flight  operations  in July 1994 with two leased  Boeing  737-200 jets. We have
since  expanded our fleet to 25 leased jets,  including  seven Boeing  737-200s and 18 larger Boeing  737-300s.  We currently use up to
nine gates at our hub, Denver International Airport ("DIA"), where we operate approximately 114 daily system flight departures.

       We are  commencing a fleet  replacement  plan to phase out our Boeing 737 aircraft  and replace them with a  combination  of new
Airbus  A319 and A318  aircraft.  The  decision  to change  fleet  types  was made for many  reasons,  including  the  availability  of
updated  technology,  operational  advantages  and cabin comfort (wider cabin,  wider seats with added  amenities,  more  legroom).  We
have agreed to firm  purchases of 12 of these  aircraft,  and have options to purchase up to an  additional  17 aircraft.  We also have
agreed to lease 16 new Airbus  aircraft.  We expect to take delivery of our first  purchased  Airbus aircraft in May 2001 and our first
leased Airbus  aircraft in June 2001, and we expect that both aircraft will enter  scheduled  service in June 2001. We plan to complete
our  fleet  transition  by the end of 2004.  Upon  completion  of our fleet  transition,  we expect  our owned and  leased  fleet to be
comprised of  approximately  two-thirds  A319 aircraft and one-third A318 aircraft.  The A319 and A318 aircraft will be configured with
132 and 114  passenger  seats,  respectively,  with a 33-inch  seat pitch.  We expect to incur  significant  costs,  as well as realize
certain cost savings,  in connection with our transition  from a Boeing to an Airbus aircraft fleet.  Reference is made to Exhibit 99.1
filed with this report on Form 10-Q for a discussion of these costs and savings.

       In January 2001, we announced  EarlyReturns,  our own frequent flyer program that commenced February 1, 2001. We believe our new
frequent  flyer  program  offers  some of the most  generous  benefits  in the  industry,  including  a free round trip at only  15,000
accumulated  miles.  Members  earn one mile for every mile flown on  Frontier  plus  additional  mileage  with  program  partners  that
presently include  Continental  Airlines,  Midwest Express Airlines and Virgin Atlantic Airways as well as Alamo,  Hertz,  National and
Payless car rentals,  Kimpton  Group Hotels and Citicorp  Diners  Club.  Members who earn 25,000 or more annual  credited  flight miles
attain  EarlyReturns  Summit Level,  which include a 25% mileage bonus on every paid Frontier flight,  priority  check-in and boarding,
complimentary on-board alcoholic beverages,  extra allowance on checked baggage and priority baggage handling,  guaranteed reservations
on any Frontier  flight when purchasing an unrestricted  Y-class ticket at least 72 hours prior to departure,  and an exclusive  Summit
customer  service  toll-free  phone number.  To apply for the program,  customers  can visit our Web site at  www.frontierairlines.com,
pick up an EarlyReturns  enrollment form at any of our airport  counters or call our EarlyReturns  Service Center toll-free  hotline at
866-26-EARLY or reservations at 800-4321-FLY.

       Small  fluctuations in our yield per revenue passenger mile ("RPM") or expense per available seat mile ("ASM") can significantly
affect  operating  results  because we, like other  airlines,  have high fixed costs in relation to revenues.  Airline  operations  are
highly sensitive to various factors,  including the actions of competing  airlines and general  economic  factors,  which can adversely
affect our liquidity, cash flows and results of operations.

Results of Operations

       We had net income of  $46,926,000  or $2.42 per diluted  share for the nine months  ended  December  31, 2000 as compared to net
income of  $20,125,000  or $1.07 per diluted share for the nine months ended December 31, 1999. We had net income of $10,285,000 or 52(cent)
per diluted  share for the three months ended  December 31, 2000 as compared to net income of  $3,095,000  or 16(cent)per diluted share for
the three months ended December 31, 1999.  During the nine months ended December 31, 2000, as compared to the prior comparable  period,
we experienced higher average fares and load factors as a result of increases in the number of business  travelers,  a general increase
in fare levels  including  increases  intended to offset increased fuel costs, and an increase in the number of passengers that a major
competitor  directed to us because of an increase in the number of delays and cancellations that airline  experienced.  We believe that
our passenger  traffic and related  revenues during the nine months ended December 31, 1999 were adversely  affected by late deliveries
of aircraft and consumer concerns over the Year 2000 issue.

       Our cost per ASM for the nine months ended December 31, 2000 and 1999 were 9.09(cent)and 7.97(cent),  respectively,  an increase of 1.12(cent)
or 14.1%.  Cost per ASM  excluding  fuel for the nine months ended  December 31, 2000 and 1999 were 7.40(cent)and 6.82(cent),  respectively,  an
increase of .58(cent)or 9%. Our cost per ASM increased during the nine months ended December 31, 2000  principally  because of increases in
the cost of fuel which  accounted  for .54(cent)per ASM,  aircraft  rentals  for newer and  larger  aircraft  of .12(cent)per ASM,  maintenance
expense of .11(cent)per ASM, and general and  administrative  expenses  primarily due to accrued  bonuses for all employees  resulting from
increased  profitability,  and a higher level of employee  benefits of .14(cent)per ASM. A general wage rate increase  effective in January
2000 and an  increase  in pilots'  salaries  effective  in May 2000 also  contributed  to the  increase in cost per ASM during the nine
months ended December 31, 2000.  During the nine months ended December 31, 2000, two of our aircraft  experienced  unusually  extensive
maintenance  checks upon the first  occasions  we were  required to perform  annual  maintenance  checks on these  aircraft  since they
entered our fleet.  During the nine months  ended  December  31, 2000,  we also  performed  "D" checks on two of our aircraft for which
maintenance reserves paid to the lessor for reimbursement of these events did not entirely cover the associated expenses.

       An  airline's  break-even  load  factor is the  passenger  load factor that will  result in  operating  revenues  being equal to
operating  expenses,  assuming  constant  revenue per passenger  mile and expenses.  For the nine months ended  December 31, 2000,  our
break-even  load factor was 52.2%  compared to our achieved  passenger  load factor of 66.8%.  For the nine months  ended  December 31,
1999,  our  break-even  load factor was 51.1%  compared to our achieved  passenger  load factor of 59.3%.  Our  break-even  load factor
increased  over the prior  comparable  period  largely as a result of an  increase  in our expense per ASM to 9.09(cent)for the nine months
ended  December  31, 2000 from 7.97(cent)for the nine months ended  December  31,  1999,  offset by an increase in our average fare to $147
during the nine months ended  December 31, 2000 from $132 during the nine months ended  December 31, 1999, and an increase in our total
yield per RPM from 15.29(cent)for the nine months ended December 31, 1999 to 16.95(cent)for the nine months ended December 31, 2000.

       During the nine months ended December 31, 2000 our average daily block hour utilization  decreased to 9.3 from 10.1 for the nine
months ended  December 31, 1999.  The  calculation  of our block hour  utilization  includes all aircraft that are on our  certificate,
which  encompass  scheduled  aircraft as well as  operational  and  maintenance  spares.  In August  2000 we took  delivery of our 25th
aircraft on a power by the hour  agreement  until  December  2000 when we placed  this  aircraft  into  scheduled  service.  Therefore,
aircraft utilization decreased due to the schedule block hours being diluted by an additional aircraft on our certificate.

       The following  table  provides  certain of our  financial  and  operating  data for the three month and nine month periods ended
December 31, 2000 and 1999.

                                                 Selected Financial and Operating Data

                                              Three Months Ended December 31,      Nine Months Ended December 31,
                                                  2000              1999               2000              1999
                                            ------------------------------------ ------------------------------------

Passenger revenue (000s) (1)                     $111,319          $71,663            $350,690          $231,051
Revenue passengers carried (000s)                     750              509               2,289             1,679
Revenue passenger miles (RPMs) (000s) (2)         685,507          470,484           2,113,107         1,552,207
Available seat miles (ASMs) (000s) (3)          1,071,714          900,328           3,162,972         2,616,813
Passenger load factor (4)                           64.0%            52.3%               66.8%             59.3%
Break-even load factor (5)                          54.3%            48.6%               52.2%             51.1%
Block hours (6)                                    21,068           17,660              61,916            52,432
Departures                                          9,755            8,234              28,656            24,618
Average seats per departure                           131              130                 131               128
Average stage length                                  839              841                 843               830
Average length of haul                                914              924                 923               924
Aircraft miles (000s)                               8,181            6,926              24,145            20,444
Average daily block hour utilization (7)              9.2              9.7                 9.3              10.1
Yield per RPM (cents) (8)                           16.24            15.23               16.60             14.89
Total yield per RPM (cents) (9)                     16.66            15.72               16.95             15.29
Total yield per ASM (cents) (10)                    10.66             8.22               11.32              9.07
Expense per ASM (cents)                              9.29             7.77                9.09              7.97
Expense per ASM excluding fuel (cents)               7.37             6.50                7.40              6.82
Average fuel cost per gallon                        $1.22            $0.85               $1.07             $0.73
Passenger revenue per block hour                   $5,284           $4,058              $5,664            $4,407
Average fare (11)                                    $142             $135                $146              $132
Average aircraft in fleet                            25.0             19.7                24.3              18.9
Aircraft in fleet at end of period                   25.0             20.0                25.0              20.0
Average age of aircraft at end of period             11.1             11.0                11.0              11.0
Average full-time equivalent employees              2,029            1,596               1,894             1,506
EBITDAR (000s) (12)                                31,603           17,263             119,728            65,921
EBITDAR as a % of revenue                           27.7%            23.3%               33.4%             27.8%


(1)  "Passenger revenue" includes revenues for non-revenue passengers, administrative fees, and revenue recognized for unused tickets
     that are greater than one year from issuance date.
(2)  "Revenue passenger miles," or RPMs, are determined by multiplying the number of fare-paying passengers carried by the distance
     flown.
(3)  "Available seat miles," or ASMs, are determined by multiplying the number of seats available for passengers by the number of
     miles flown.
(4)  "Passenger load factor" is determined by dividing revenue passenger miles by available seat miles.
(5)  "Break-even load factor" is the passenger load factor that will result in operating revenues being equal to operating expenses,
     assuming constant revenue per passenger mile and expenses
(6)  "Block hours" represent the time between aircraft gate departure and aircraft gate arrival.
(7)  "Average daily block hour utilization" represents the total block hours divided by the weighted average number of aircraft days
     in service.
(8)  "Yield per RPM" is determined by dividing passenger revenues by revenue passenger miles.
(9)  "Total Yield per RPM" is determined by dividing total revenues by revenue passenger miles.
(10) "Total Yield per ASM" is determined by dividing total revenues by available seat miles.
(11) "Average fare"  excludes revenue included in passenger revenue for non-revenue passengers, administrative fees, and revenue
     recognized for unused tickets that are greater than one year from issuance date.
(12) "EBITDAR", or "earnings before interest, income taxes, depreciation, amortization and aircraft rentals," is a supplemental
     financial measurement many airline industry analysts and we use in the evaluation of our business.  However, EBITDAR should only
     be read in conjunction with all of our financial statements appearing elsewhere herein, and should not be construed as an
     alternative either to operating income (as determined in accordance with generally accepted accounting principles) as an
     indicator of our operating performance or to cash flows from operating activities (as determined in accordance with generally
     accepted accounting principles) as a measure of liquidity.

       The following table provides our operating  revenues and expenses expressed as cents per total ASMs and as a percentage of total
operating revenues, as rounded, for the three month and nine month periods ended December 31, 2000 and 1999.

                                   Three Months Ended December 31,              Nine Months Ended December 31,
                              ------------------------------------------- -------------------------------------------
                                      2000                  1999                  2000                 1999
                              ------------------------------------------- -------------------------------------------
                                  Per         %        Per         %         Per         %         Per         %
                                 total       of       total       of        total       of        total       of
                                  ASM      Revenue     ASM      Revenue      ASM      Revenue      ASM      Revenue
                                  ---      -------     ---      -------      ---      -------      ---      -------


Revenues:
    Passenger                   10.39        97.5%     7.96      96.9%      11.09       97.9%      8.83      97.4%
    Cargo                        0.20         1.8%     0.20       2.4%       0.17        1.5%      0.18       2.0%
    Other                        0.07         0.7%     0.06       0.7%       0.06        0.6%      0.06       0.7%
                              ------------------------------------------- -------------------------------------------
Total revenues                  10.66       100.0%     8.22     100.0%      11.32      100.0%      9.07     100.0%
                              =========================================== ===========================================

Operating expenses:
    Flight operations            4.48        42.0%     3.59      43.7%      4.18        36.9%      3.39      37.3%
    Aircraft and traffic         1.43        13.4%     1.38      16.8%      1.38        12.2%      1.35      14.9%
      servicing
    Maintenance                  1.49        13.9%     1.20      14.6%      1.53        13.5%      1.41      15.5%
    Promotion and sales          1.23        11.6%     1.11      13.5%      1.30        11.5%      1.31      14.4%
    General and
      administrative             0.54         5.0%     0.40       4.8%      0.58         5.1%      0.44       4.8%
    Depreciation and
     amortization                0.13         1.2%     0.09       1.1%      0.12         1.0%      0.08       0.8%
                              ------------------------------------------- -------------------------------------------
Total operating expenses         9.29        87.2%     7.77      94.6%      9.09        80.3%      7.97      87.8%
                              =========================================== ===========================================

Total ASMs (000s)              1,071,714            900,328             3,162,972                        2,616,813


       Our revenues are highly sensitive to changes in fare levels.  Fare pricing  policies have a significant  impact on our revenues.
Because of the  elasticity  of passenger  demand,  we believe that  increases  in fares may at certain  levels  result in a decrease in
passenger  demand in many  markets.  We cannot  predict  future  fare  levels,  which  depend to a  substantial  degree on  actions  of
competitors.  When sale prices or other price changes are  initiated by  competitors  in our markets,  we believe that we must, in most
cases,  match those competitive fares in order to maintain our market share.  Passenger revenues are seasonal in leisure travel markets
depending on the markets' locations and when they are most frequently patronized.

       Our average  fare for the nine months  ended  December  31, 2000 and 1999 was $147 and $132,  respectively.  We believe that the
increase  in the  average  fare  during the nine  months  ended  December  31,  2000 over the prior  comparable  period was a result of
increases in the number of business  travelers,  a general  increase in fare levels  including  increases  intended to offset increased
fuel costs,  and an increase in the number of passengers  that a major  competitor  directed to us because of an increase in the number
of delays and  cancellations  that airline  experienced.  We estimate that the additional  passenger traffic received from that airline
had the effect of  increasing  our average fare and load factor for the nine months ended  December 31, 2000 by  approximately  .7 load
factor points and .2%, respectively.

       Passenger  Revenues.  Passenger  revenues  totaled  $350,690,000  for the nine  months  ended  December  31,  2000  compared  to
$231,051,000  for the nine months ended  December  31,  1999,  or an increase of 51.8%,  which  exceeded the 20.9%  increase in ASMs of
546,159,000.  The number of revenue  passengers carried was 2,289,000 for the nine months ended December 31, 2000 compared to 1,679,000
for the nine months ended  December 31, 1999 or an increase of 36.3%.  We had an average of 24.3  aircraft in our fleet during the nine
months ended  December 31, 2000 compared to an average of 18.9 aircraft  during the nine months ended December 31, 1999, an increase of
28.6%.  RPMs for the nine months  ended  December  31, 2000 were  2,113,107,000  compared to  1,552,207,000  for the nine months  ended
December 31, 1999, an increase of 36.1%.

       Cargo Revenues.  Cargo revenues,  consisting of revenues from freight and mail service,  totaled  $5,375,000 and $4,686,000,  an
increase of 14.7%, for the nine months ended December 31, 2000 and 1999,  respectively,  representing 1.5% and 2.0%,  respectively,  of
total  operating  revenues.  Cargo  revenues  totaled  $2,102,000 and $1,768,000 for the three months ended December 31, 2000 and 1999,
representing 1.8% and 2.4% of total operating  revenues,  respectively,  an increase of 18.9%.  During July 2000 an audit was performed
on our contract cargo sales and services  provider.  The audit  disclosed that for a 15 month period between  January 1, 1999 and March
31, 2000 both cash and credit card sales were  remitted  to us by our  services  provider,  even though we had  collected  for the cash
sales directly from our customer.  We therefore  adjusted cargo revenue downward  $423,000 during the three months ended June 30, 2000.
Excluding the effect of this  adjustment,  on the current and prior  comparable  period,  cargo revenue would have been  $5,798,000 and
$4,429,000  for the nine months ended  December 31, 2000 and 1999,  respectively,  an increase of 30.9%.  This adjunct to the passenger
business is highly  competitive and depends heavily on aircraft  scheduling,  alternate  competitive means of same day delivery service
and schedule reliability.

       Other  Revenues.  Other  revenues,  comprised  principally  of interline  handling  fees,  liquor sales and excess baggage fees,
totaled  $2,039,000 and $1,576,000,  or .6% and .7%,  respectively,  of total operating revenues for the nine months ended December 31,
2000 and 1999, an increase of 29.4%.

Operating Expenses

       Operating  expenses  include those related to flight  operations,  aircraft and traffic  servicing,  maintenance,  promotion and
sales,  general and administrative  and depreciation and amortization.  Total operating expenses were $287,475,000 and $208,435,000 for
the nine months ended December 31, 2000 and 1999 and  represented  80.3% and 88% of revenue,  respectively.  Total  operating  expenses
for the three months ended December 31, 2000 and 1999 were  $99,550,000 and  $69,964,000  and  represented  87.2% and 94.6% of revenue,
respectively.  Operating  expenses  decreased as a percentage of revenue  during the three and nine months ended December 31, 2000 as a
result of the 51.8%  increase in passenger  revenues  attributable  primarily to a 36.3% increase in passengers and a 11.4% increase in
the  average  fare  offset by a 46.6%  increase  in the  average  cost per gallon of fuel,  a general  wage rate  increase  that became
effective  in January  2000,  an increase in pilots'  salaries  effective  in May 2000,  and an  increase in accrued  bonuses  based on
increased profitability.

       Flight  Operations.  Flight  operations  expenses of $132,090,000  and $88,599,000 were 36.9% and 37.3% of total revenue for the
nine months ended December 31, 2000 and 1999,  respectively.  Flight  operations  expenses of $48,003,000 and $32,339,000  were 42% and
43.7% of total revenue for the three months ended December 31, 2000 and 1999,  respectively.  Flight  operations  expenses  include all
expenses related directly to the operation of the aircraft  including fuel,  lease and insurance  expenses,  pilot and flight attendant
compensation, in-flight catering, crew overnight expenses, flight dispatch and flight operations administrative expenses.

       Aircraft fuel expenses  include both the direct cost of fuel,  including  taxes, as well as the cost of delivering fuel into the
aircraft.  Aircraft fuel expense of $53,278,000 for 49,595,000  gallons used and  $29,990,000  for 40,928,000  gallons used resulted in
an average  fuel cost of $1.07 and 73.3(cent)per gallon,  for the nine months  ended  December  31, 2000 and 1999,  respectively.  Aircraft
fuel expense  represented 40.3% and 33.8% of total flight  operations  expenses or 14.9% and 12.6% of total revenue for the nine months
ended December 31, 2000 and 1999,  respectively.  Aircraft fuel expense of $20,550,000 for 16,900,000  gallons used and $11,478,000 for
13,524,000  gallons used resulted in an average fuel expense of $1.22 and .85(cent)per gallon for the three months ended  December 31, 2000
and 1999,  respectively.  Aircraft  fuel costs  represented  42.8% and 35.5% of total flight  operations  expenses for the three months
ended December 31, 2000 and 1999,  respectively,  or 18% and 15.5% of total revenue.  Fuel prices are subject to change weekly as we do
not purchase  supplies in advance for  inventory.  Fuel  consumption  for the nine months ended December 31, 2000 and 1999 averaged 801
and 781 gallons per block hour,  respectively.  Fuel consumption  increased over the prior comparable  period because of an increase in
our load factor from 59.3% to 66.8%.  During the nine months ended  December 31, 2000, a major  competitor  directed  passengers  to us
because of an increase in the number of delays and  cancellations  that airline  experienced.  Because of this we increased  the speeds
we flew our aircraft to mitigate  flight delays,  which  increased our fuel burn rate.  Additionally,  we returned five aircraft to the
lessor during the year ended March 31, 2000 and replaced them with four aircraft that are larger and have a higher fuel burn rate.

       Aircraft lease expenses  totaled  $45,472,000  (12.7% of total  revenue) and  $34,661,000  (14.6% of total revenue) for the nine
months ended December 31, 2000 and 1999,  respectively,  an increase of 31.2%.  Aircraft lease expenses totaled  $15,570,000  (13.6% of
total  revenue)  and  $12,543,000  (17% of total  revenue) for the three months  ended  December  31, 2000 and 1999,  respectively,  an
increase of 24.1%.  The increase is largely due to an increase in the average  number of aircraft to 24.3 from 18.9,  or 28.6%,  during
the nine month period ended December 31, 2000 compared to the same period in 1999..

Aircraft insurance expenses totaled $2,448,000 (.7% of total revenue) for the nine months ended December 31, 2000.  Aircraft insurance expenses
for the nine months ended December 31, 1999 were $1,963,000 (.8% of total revenue). Aircraft insurance expenses were .12(cent)and .13(cent)
per RPM for the nine months ended December 31, 2000 and 1999, respectively. Aircraft insurance expenses totaled $831,000 (.7% of
total revenue) for the three months ended December 31, 2000.  Aircraft insurance expenses for the three months ended December 31,
1999 were $647,000 (.9% of total revenue). Aircraft insurance expenses were .12(cent)and .14(cent)per RPM for the three months ended December
31, 2000 and 1999, respectively.

       Pilot and flight attendant salaries before payroll taxes and benefits totaled  $16,126,000 and $11,142,000,  or 4.6% and 4.8% of
passenger  revenue for the nine months ended  December 31, 2000 and 1999,  an increase of 44.7%.  Pilot and flight  attendant  salaries
before  payroll  taxes and benefits  totaled  $5,804,000  and  $3,912,000  or 5.2% and 5.5% of passenger  revenue for each of the three
months  ended  December  31,  2000 and 1999,  an  increase  of 48.4%.  In  November  1998,  our pilots  voted to be  represented  by an
independent union, the Frontier Airline Pilots  Association.  The first bargaining  agreement for the pilots,  which has a 5-year term,
was ratified and made  effective in May 2000.  Pilot and flight  attendant  compensation  increased  principally as a result of a 28.6%
increase in the average number of aircraft in service,  general wage rate increases,  and an increase of 18.1% in aircraft block hours.
We pay pilot and flight  attendant  salaries for training,  consisting of  approximately  six and three weeks,  respectively,  prior to
scheduled  increases in service which can cause the  compensation  expense  during such periods to appear high in  relationship  to the
average  number of aircraft in service.  When we are not in the process of adding  aircraft to our system,  we expect  pilot and flight
attendant  expense  per  aircraft to  normalize.  With a  scheduled  passenger  operation,  and with  salaried  rather than hourly crew
compensation,  our expenses for flight  operations are largely fixed,  with fuel expenses and flight catering the principal  exception.
We expect  pilot and flight  attendant  salary  expense to  increase  over  approximately  the next two years as a result of the Airbus
transition and related training required for that transition.

       Aircraft and Traffic Servicing.  Aircraft and traffic servicing expenses were $43,768,000 and $35,310,000 (an increase of 23.4%)
for the nine months ended December 31, 2000 and 1999,  respectively,  and  represented  12.2% and 14.9% of total revenue.  Aircraft and
traffic  servicing  expenses were  $15,280,000  and $12,439,000 (an increase of 22.8%) for the three months ended December 31, 2000 and
1999,  respectively,  and represented 13.4% and 16.8% of total revenue.  Aircraft and traffic  servicing  expenses include all expenses
incurred at airports  including  landing fees,  facilities  rental,  station labor,  ground handling  expenses,  and  interrupted  trip
expenses  associated with delayed or cancelled  flights.  Interrupted trip expenses are amounts paid to other airlines to reaccommodate
passengers as well as hotel, meal and other incidental  expenses.  Aircraft and traffic servicing  expenses increased with the addition
of new cities and departures to our route system.  During the nine months ended  December 31, 2000, we served 23 cities  compared to 20
during the nine  months  ended  December  31,  1999,  or an increase  of 15%.  During the nine months  ended  December  31,  2000,  our
departures  increased to 28,656 from 24,618 or 16.4%.  Aircraft and traffic  servicing  expenses were $1,527 per departure for the nine
months ended  December 31, 2000 as compared to $1,434 per departure for the nine months ended  December 31, 2000, or an increase of $93
per departure.  During the three months ended December 31, 2000,  our departures  increased to 9,764 from 8,234 or 18.6%.  Aircraft and
traffic  servicing  expenses were $1,565 per departure for the three months ended December 31, 2000 as compared to $1,511 per departure
for the three months ended  December 31, 1999, or an increase of $54 per  departure.  During the three months ended  December 31, 2000,
we accrued  $800,000 ($82 per  departure),  representing  our estimate of the anticipated DIA revenue credit to be distributed to lease
signatory  carriers for DIA's fiscal year ended  December 31, 2000. We did not have  sufficient  information  during the three and nine
months ended  December 31, 1999 to provide an accrual for the DIA revenue  credit.  After  adjusting  the cost per  departure  for this
credit for the three months ended December 31, 2000,  the cost per departure  would have been $1,648 and the cost per departure for the
three months ended December 31, 2000 would have been a $137 increase over the prior comparable  period.  Aircraft and traffic servicing
expenses  increased as a result of a general wage rate  increase  effective  in January  2000,  contract  ground  handling  services in
certain of the cities we serve as a result of increased  frequencies  in existing  markets and  introduction  of service to new cities,
and increased per passenger  charges as a result of the greater  number of  passengers  we carried.  These  increases  were offset by a
decrease in  interrupted  trip expenses as a result of an  improvement  in our  completion  factor from 98.5% for the nine months ended
December 31, 1999 to 99.4% for the nine months ended December 31, 2000.

       Maintenance.  Maintenance  expenses of  $48,517,000  and  $36,883,000  were 13.5% and 15.5% of total revenue for the nine months
ended December 31, 2000 and 1999,  respectively,  an increase of 31.5%.  Maintenance  expenses of $15,927,000 and $10,837,000  were 14%
and 14.7% of total revenue for the three months ended  December 31, 2000 and 1999,  respectively,  an increase of 42.8%.  These include
all labor,  parts and supplies  expenses  related to the  maintenance  of the aircraft.  Routine  maintenance is charged to maintenance
expense as incurred while major engine  overhauls and heavy  maintenance  check expense is accrued monthly with variances from accruals
recognized  at the time of the check.  Maintenance  cost per block hour for the nine months ended  December 31, 2000 and 1999 were $784
and $703,  respectively.  Maintenance  cost per block hour for the three  months  ended  December 31, 2000 and 1999 were $756 and $614,
respectively.  During the three months ended  December 31,  1999, a previous  accrual  recorded  during the three months ended June 30,
1999  totaling  $1,340,000  for an engine  repair  expense  estimate  as a result of a  premature  failure  was  reversed as the engine
manufacturer  agreed to repair the engine at no cost to us.  Maintenance  cost per block hour for the three months  ended  December 31,
1999 would have been $690 without  this  adjustment.  Maintenance  cost per block hour  increased  as a result of increased  facilities
rentals to satisfy  additional  space  requirements  for the  increase in aircraft  coupled  with an increase in the number of aircraft
simultaneously out of service for heavy  maintenance,  and a general wage rate increase effective January 2000. Because of the increase
in the number of aircraft out of service for heavy  maintenance,  our average daily block hour utilization  decreased from 10.1 for the
nine months  ended  December 31, 1999 to 9.3 for the nine months ended  December  31, 2000.  During the nine months ended  December 31,
2000,  two of our aircraft  experienced  unusually  extensive  maintenance  checks.  During the nine months ended December 31, 2000, we
also performed "D" checks on two of our aircraft for which  maintenance  reserves paid to the lessor for  reimbursement of these events
did not cover the associated  expense.  These were the first occasions we were required to perform annual  maintenance  checks on these
aircraft  since they  entered our fleet.  Additionally,  during the nine months  ended  December  31,  2000,  we accrued an  additional
$787,000 ($13 per block hour) for engine  reserves  based on revised cost  estimates  and a revised  schedule of engine  overhauls.  We
also incurred  increased costs in personnel,  training and information  technology  expenses for  implementation of new maintenance and
engineering  software  and in  preparation  for the Airbus  aircraft  transition.  In January  2001, a lease for spare  aircraft  parts
expired and we purchased  these parts for  $2,500,000.  During the nine months ended December 31, 2000 we incurred  $1,241,000 of lease
expenses associated with this lease included in maintenance expenses or $20 per block hour.

       Promotion and Sales.  Promotion and sales expenses totaled $41,042,000 and $34,218,000 and were 11.5% and 14.4% of total revenue
for the nine months ended December 31, 2000 and 1999,  respectively.  Promotion and sales expenses  totaled  $13,221,000 and $9,991,000
and were  11.6% and 13.5% of total  revenue  for the three  months  ended  December  31,  2000 and 1999,  respectively.  These  include
advertising  expenses,  telecommunications  expenses,  wages and benefits for reservationists  and reservations  supervision as well as
marketing management and sales personnel,  credit card fees, travel agency commissions and computer  reservations costs.  Promotion and
sales  expenses  decreased as a  percentage  of revenue for the nine months ended  December 31, 2000 over the prior  comparable  period
largely as a result of the increase in revenue and a decrease in travel agency commissions.

       During the nine months ended  December 31, 2000,  promotion  and sales  expenses per passenger  decreased to $17.93  compared to
$20.38 for the nine months  ended  December 31,  1999.  Promotion  and sales  expenses  decreased  largely as a result of a decrease in
travel agency commissions from 8% to 5% effective in November 1999,  matching a decrease  instituted by our competitors.  Travel agency
commissions  and interline  service charges and handling fees, as a percentage of passenger  revenue,  before  non-revenue  passengers,
administrative  fees and breakage  (revenue  from  expired  tickets),  decreased  to 3.5% for the nine months  ended  December 31, 2000
compared to 4.8% for the nine months ended  December  31,  1999.  The  decrease in travel  agency  commissions  was offset by increased
commission  expense  associated with the increase in our average fare as we do not cap commissions.  With increased activity on our web
site, our calls per passenger  have  decreased.  Because of the increase in web site  activity,  as well as a decrease in long distance
rates,  we  experienced  a decrease in  communications  expense.  In July 2000,  we opened an  additional  reservation  facility in Las
Cruces,  New Mexico and terminated an outsourcing  agreement,  which reduced our cost of  reservations.  These cost savings were offset
by an increase in credit card fees  associated  with the increase in our average fare from $132 for the nine months ended  December 31,
1999 to $147 for the nine months ended December 31, 2000.

       General and  Administrative.  General and  administrative  expenses for the nine months ended December 31, 2000 and 1999 totaled
$18,384,000 and $11,436,000 and were 5.1% and 4.8% of total revenue,  respectively,  an increase of 60.8%.  General and  administrative
expenses  for the three  months  ended  December 31, 2000 and 1999  totaled  $5,738,000  and  $3,578,000  and were 5% and 4.8% of total
revenue,  respectively,  an increase of 60.4%.  During the nine  months  ended  December  31,  2000 and 1999,  we accrued for  employee
performance  bonuses  totaling  $5,615,000  and  $2,183,000,  respectively,  which were 1.6% and .9% of total  revenue,  an increase of
157.2%.  Employee  performance  bonuses  increased over the prior comparable  period as a result of our increased  profitability and an
enhancement  to the bonus  program.  General and  administrative  expenses  include the wages and benefits for several of our executive
officers and various other  administrative  personnel  including  legal,  accounting,  information  technology,  aircraft  procurement,
corporate  communications,  training  and human  resources  and other  expenses  associated  with these  departments.  Employee  health
benefits, accrued vacation and bonus expenses, general insurance expenses,  including worker's compensation,  and write-offs associated
with credit card  chargebacks  are also  included  in general  and  administrative  expenses.  We  experienced  increases  in our human
resources,  training and information  technology  expenses as a result of an increase in employees from approximately 1,950 in December
1999 to  approximately  2,300 in December  2000, an increase of 18%. We also  experienced  personnel  increases in the area of aircraft
procurement as a result of the purchase and lease  agreements  for Airbus  aircraft.  Because of the increase in personnel,  our health
insurance  benefit  expenses and accrued vacation expense  increased  accordingly.  During the nine months ended December 31, 2000, our
accrued vacation expense increased as a result of the increase in pilot salaries and vacation  benefits due to a collective  bargaining
agreement  concluded  with the pilots'  union  effective in May 2000.  During the three months ended  December 31, 2000, we reduced our
health insurance  liability by $507,000 because our benefit claim payments have been less than  actuarially  developed  expected costs.
During the three months ended  December 31, 2000,  we reduced the accrual rate for credit card  chargebacks  and reduced our  allowance
for doubtful  accounts by $372,000.  During the nine months ended December 31, 2000, we  implemented  new  procedures  associated  with
certain sales transactions which reduced the volume of chargebacks we had previously experienced.

       Depreciation and  Amortization.  Depreciation  and  amortization  expenses of $3,674,000 and $1,988,000 were 1% and .8% of total
revenue,  respectively,  for the nine  months  ended  December  31,  2000 and 1999,  an  increase  of  84.8%.  These  expenses  include
depreciation of office equipment,  ground station  equipment,  spare parts,  aircraft leasehold  improvements,  and other fixed assets.
Amortization of start-up and route  development  costs are not included as these expenses have been expensed as incurred.  Depreciation
and  amortization  expenses  increased  over the prior year as a result of an increase in our spare parts  inventory  including a spare
engine,  leasehold  improvements  associated with 14 aircraft (eight additional and six replacement) added to our fleet during the past
21 months, ground handling equipment, and computers to support new employees as well as replacement computers.

       Nonoperating  Income (Expense).  Net nonoperating income totaled $5,898,000 for the nine months ended December 31, 2000 compared
to $2,970,000 for the nine months ended December 31, 1999.  Interest  income  increased from  $3,120,000 to $6,002,000  during the nine
months ended  December 31, 2000 from the prior period due to an increase in cash  balances as a result of an increase in cash  provided
by operating activities and proceeds from stock option and warrant exercises.

       Income Tax Expense.  We accrued income taxes of $29,601,000  and $12,272,000 at 39% and 38.25% of taxable income during the nine
months ended December 31, 2000 and 1999, respectively.

Liquidity and Capital Resources

       Our balance sheet  reflected cash and cash  equivalents and short-term  investments of $106,275,000  and $83,611,000 at December
31, 2000 and March 31, 2000,  respectively.  At December 31, 2000,  total current assets were  $169,507,000 as compared to $105,356,000
of total current  liabilities,  resulting in working capital of $64,151,000.  At March 31, 2000, total current assets were $140,361,000
as compared to $98,475,000  of total current  liabilities,  resulting in working  capital of  $41,886,000.  The increase in our working
capital is largely a result of cash flows  provided by operating  activities  and proceeds  from  exercises of Common Stock options and
warrants  during the nine months  ended  December  31,  2000.  We believe  that our existing  cash  balances,  combined  with  improved
operating results,  are and will be adequate to fund our operations for the foreseeable  future.  However,  as discussed below, we will
require financing in order to fund our intended purchase of Airbus A319 and A318 aircraft.

       Cash provided by operating  activities for the nine months ended December 31, 2000 was $52,359,000.  This is attributable to our
net income for the period,  decreases in receivables and increases in accrued  expenses,  income taxes payable and accrued  maintenance
expense,  offset by increases in restricted  investments,  security,  maintenance and other deposits,  and inventories and decreases in
accounts  payable and air traffic  liability.  Cash provided by operating  activities  for the nine months ended  December 31, 1999 was
$31,481,000.  This is  attributable  to our net income for the period and a decrease  in  receivables  and  increases  in income  taxes
payable and accrued maintenance expenses, offset by increases in security,  maintenance and other deposits,  prepaid expenses and other
assets, and inventories, and decreases in accounts payable and air traffic liability.

       Cash  used by  investing  activities  for the nine  months  ended  December  31,  2000 was  $16,862,000.  We had  maturities  of
$13,760,000 in short-term  investments,  net of purchases,  comprised of  certificates of deposit and  government-backed  agencies with
maturities  of one year or less.  During the nine  months  ended  December  31,  2000,  we made cash  security  deposits  and  aircraft
pre-delivery  payments totaling $16,432,000 and an increase in restricted  investments  totaling $3,581,000  associated with two leased
Boeing 737-300  aircraft  delivered during the nine months ended December 31, 2000, the 16 Airbus aircraft we have agreed to lease with
delivery  dates  beginning in June 2001,  and the 12 Airbus  aircraft we have agreed to purchase with delivery  dates  beginning in May
2001.  During the nine months ended December 31, 2000, we used $10,610,000 for capital  expenditures  for rotable aircraft  components,
maintenance  equipment and tools,  aircraft  leasehold costs and improvements,  computer equipment and software for enhancements to our
internet booking site, our reservation  system and a replacement  maintenance  system.  Cash used by investing  activities for the nine
months ended December 31, 1999 was $33,011,000.  We invested  $18,260,000 in short-term  investments,  net of maturities,  comprised of
government-backed  agencies and commercial  paper with maturities of one year or less.  During the nine months ended December 31, 1999,
cash  security  deposits for aircraft  totaling  $2,491,000  were  returned to us or replaced  with letters of credit.  During the nine
months ended December 31, 1999, we made cash security  deposits  totaling  $200,000 in connection  with a letter of intent on an Airbus
lease and  $2,550,000 in down payments  associated  with a letter of intent to purchase  Airbus  aircraft.  We had issued to certain of
our aircraft  lessors  warrants to purchase  395,000 shares of our Common Stock at an aggregate  purchase  price of $2,391,600.  During
May 1999 and June 1999,  the  aircraft  lessors  exercised  all of these  warrants and we received  $2,391,600.  To the extent that the
aircraft  lessors were able to realize  certain  profit  margins on their  subsequent  sale of our Common Stock,  they were required to
refund a portion of the cash  security  deposits  they were  holding.  As a result of their  sales of our Common  Stock,  the  aircraft
lessors  returned to us  $1,024,000  in cash  security  deposits  during the nine months ended  December 31, 2000.  Other cash security
deposits  were replaced  with letters of credit and these  deposits  were  returned to us. We also  received  $625,000 in cash security
deposits for aircraft  delivered  during the nine months ended  December 31, 2000.  Additionally,  we secured five  aircraft  delivered
during the nine months ended  December 31, 1999 with letters of credit  totaling  $2,284,000 and  restricted  investments  increased by
this amount to  collateralize  the letters of credit.  We used $12,208,000 for capital  expenditures  for rotable  aircraft  components
including a spare CFM engine,  maintenance  equipment and tools,  aircraft  leasehold costs and  improvements,  and computer  equipment
during the nine months ended December 31, 1999.

       Cash  provided by  financing  activities  for the nine months ended  December  31, 2000 and 1999 was  $927,000  and  $5,090,000,
respectively,  from the exercise of Common Stock  options and  warrants,  offset by principal  payments on  obligations  under  capital
leases.  In April  1998,  we issued a warrant  to  purchase  716,929  shares of the our Common  Stock at a purchase  price of $3.75 per
share. In January 2001, the warrant holder  purchased  366,929 shares of our Common Stock under this warrant  resulting in net proceeds
to us of $1,376,000.

       As of January 31, 2000, we lease 25 Boeing 737 type aircraft under operating  leases with expiration  dates ranging from 2002 to
2006.  Under  these  leases,  we were  required  to make cash  security  deposits  or issue  letters  of  credit  to  secure  our lease
obligations.  At December  31, 2000,  we had made cash  security  deposits and had arranged for issuance of letters of credit  totaling
$3,658,000  and  $7,126,000,  respectively.  Accordingly,  our restricted  cash balance  includes  $7,126,000  that  collateralize  the
outstanding  letters of credit.  Additionally,  we make deposits for maintenance of these aircraft.  At December 31 and March 31, 2000,
we had made maintenance deposits of $38,029,300  and $26,912,000, respectively.

       We have adopted a fleet  replacement  plan to phase out our Boeing 737 aircraft  and replace them with a  combination  of Airbus
A319 and A318  aircraft.  In March  2000,  we entered  into an  agreement,  as  subsequently  amended,  to purchase up to 29 new Airbus
aircraft.  We have agreed to firm  purchases of 12 of these  aircraft,  and have options to purchase up to an  additional  17 aircraft.
Under the terms of the purchase agreement,  we are required to make scheduled pre-delivery payments.  These payments are non-refundable
with certain  exceptions.  As of December 31, 2000, we have made pre-delivery  payments  totaling  $22,232,000 to secure these aircraft
and  option  aircraft.  As a  complement  to this  purchase,  in April and May 2000 we signed  two  agreements  to lease 16 new  Airbus
aircraft.  As of December 31, 2000,  we have made cash  security  deposits and had arranged for issuance of letters of credit  totaling
$200,000 and $3,089,000,  respectively,  to secure these aircraft.  The aggregate additional amounts due under this purchase commitment
and estimated  amounts for  buyer-furnished  equipment and spare parts for both the  purchased  and leased  aircraft was  approximately
$380,000,000  as of January 2001. We expect to take delivery of our first  purchased  Airbus  aircraft in May 2001 and our first leased
Airbus  aircraft in June 2001,  and plan to complete  our fleet  transition  by the end of 2004.  In order to complete  the purchase of
these aircraft we must secure acceptable  aircraft  financing.  The amount of financing  required will depend on the number of aircraft
purchase  options we  exercise  and the amount of cash  generated  by  operations  prior to delivery  of the  aircraft.  We continue to
explore various financing  alternatives,  including but not limited to domestic and foreign bank financing,  public debt financing such
as enhanced equipment trust certificates,  and leveraged lease arrangements.  While we believe that such financing will be available to
us, there can be no assurance that financing will be available  when  required,  or on acceptable  terms.  The inability to secure such
financing could result in delays in or our inability to take delivery of Airbus  aircraft we have agreed to purchase,  which would have
a material adverse effect on us.

       We expect to incur significant  costs, as well as realize certain cost savings,  in connection with our transition from a Boeing
to an Airbus  aircraft  fleet.  Reference is made to Exhibit  99.1 filed with this report on Form 10-Q for a discussion  of these costs
and savings.

Item 3:  Quantitative and Qualitative Disclosures About Market Risk

       The risk inherent in our market risk  sensitive  position is the potential  loss arising from an adverse  change in the price of
fuel as described  below. The sensitivity  analysis  presented does not consider either the effect that such an adverse change may have
on overall economic  activity or additional  action  management may take to mitigate our exposure to such a change.  Actual results may
differ from the amounts  disclosed.  At the present time, we do not utilize fuel price  hedging  instruments  to reduce our exposure to
fluctuations in fuel prices.

       Our  earnings  are  affected  by  changes  in the price and  availability  of  aircraft  fuel.  Market  risk is  estimated  as a
hypothetical  10 percent  increase in the average cost per gallon of fuel for the year ended March 31, 2000.  Based on fiscal year 2000
actual fuel usage,  such an increase  would have resulted in an increase to aircraft fuel expense of  approximately  $4,442,000 in that
fiscal year.  Comparatively,  based on projected fiscal year 2001 fuel usage,  such an increase would result in an increase to aircraft
fuel  expense of  approximately  $5,351,000  in fiscal year 2001.  The increase in exposure to fuel price  fluctuations  in fiscal year
2001 is due to the increase of our average aircraft fleet size during the year ended March 31, 2000,  projected  increases to our fleet
during the year ended March 31, 2001 and related gallons purchased.

       The price of fuel has recently  increased  substantially  more than the  foregoing  hypothetical  example.  Our average cost per
gallon of fuel for the nine months  ended  December  31,  2000  increased  45.9% over our average  cost for fuel during the same period
ended  December 31, 1999.  See  "Management's  Discussion  and Analysis of Financial  Condition  and Results of  Operations - Operating
Expenses."






                                                      PART II. OTHER INFORMATION




Item 5:       Other Information

              See Exhibit 99.1, Frontier Airlines Fleet Transition Discussion.

Item 6:       Exhibits and Reports on Form 8-K
              --------------------------------

Exhibit
Numbers
- -------

     (a) Exhibits

               10.51 (b)   Amendment No. 2 to Airbus A318/A319 Purchase Agreement dated as of March 10, 2000 between AVSA, S.A.R.L.,
                           Seller, and Frontier Airlines, Inc., Buyer.  Portions of this exhibit have been excluded from the publicly
                           available document and an application for an order granting confidential treatment of the excluded material
                           has been made (1).

               10.61       Lease Agreement dated as of  December 15, 2000 between Gateway Office four, LLC, Lessor, and Frontier
                           Airlines, Inc., Lessee (1).

               99.1        Frontier Airlines Fleet Transition Discussion (1).


     (1) Filed herewith.


     (b) Reports on Form 8-K

              Report on Form 8-K filed with the Commission on January 22, 2001, Commission File No. 0-24126.








                                                              SIGNATURES

Pursuant to the requirements of the Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by
the undersigned, thereunto duly authorized.


                                                     FRONTIER AIRLINES, INC.


Date:  February 7, 2001                              By: /s/ Steve B. Warnecke
                                                     ----------------------------------------------
                                                     Steve B. Warnecke, Vice President and
                                                     Chief Financial Officer

Date:  February 7, 2001                              By: /s/ Elissa A. Potucek
                                                     ----------------------------------------------
                                                     Elissa A. Potucek, Vice President, Controller,
                                                     Treasurer and Principal Accounting Officer

EX-10.51(B)

                                                Amendment No. 2

                                      To the A318/A319 Purchase Agreement
                                          Dated as of March 10, 2000

                                                    between

                                                AVSA, S.A.R.L.

                                                      and

                                            FRONTIER AIRLINES, INC.




This Amendment No. 2 (hereinafter referred to as the "Amendment") is entered into as of October _____, 2000,
between AVSA, S.A.R.L., a societe a responsabilite limitee organized and existing under the laws of the
Republic of France, having its registered office located at 2, Rond-Point Maurice Bellonte, 31700 Blagnac,
France (hereinafter referred to as the "Seller"), and Frontier Airlines, Inc., a corporation organized and
existing under the laws of the State of Colorado, United States of America, having its principal corporate
offices located at 12015 East 46th Avenue, Suite 200, Denver, CO 80239-3116, USA (hereinafter referred to as
the "Buyer").

                                                  WITNESSETH

WHEREAS, the Buyer and the Seller entered into an A318/A319 Purchase Agreement, dated as of March 10, 2000,
relating to the sale by the Seller and the purchase by the Buyer of certain Airbus Industrie A318-100 and
A319-100 model aircraft (the "Aircraft") which, together with all Exhibits, Appendixes and Letter Agreements
attached thereto and as amended by Amendment No. 1 dated as of July 17, 2000, is hereinafter called the
"Agreement".

WHEREAS, the Buyer and the Seller have agreed to make changes to the delivery schedule of the Aircraft.

NOW, THEREFORE, IT IS AGREED AS FOLLOWS






1.       DEFINITIONS
         -----------

         Capitalized terms used herein and not otherwise defined herein will have the meanings assigned to
         them in the Agreement. The terms "herein", "hereof" and "hereunder" and words of similar import
         refer to this Amendment.

2.       CLAUSE 9:  DELIVERY SCHEDULE
         ----------------------------

2.1      The Buyer and the Seller agree to *.

2.2      As a consequence of Paragraph 2.1 above, the delivery schedule set forth in Clause 9.1.1 of the
         Agreement is hereby canceled and replaced by the following quoted provisions:

         QUOTE

    Firm Aircraft   A/C ID      Aircraft Type                                     Delivery
    --------------  ------      -------------                                     --------
    No.
    ---

         1          *           *                                                 *
         2          *           *                                                 *
         3          *           *                                                 *
         4          *           *                                                 *
         5          *           *                                                 *
         6          *           *                                                 *

         7          *           *                                                 *
         8          *           *                                                 *
         9          *           *                                                 *

         10         *           *                                                 *

         11         *           *                                                 *
         12         *           *                                                 *







    Option          A/C ID        Aircraft Type                                     Delivery
    -------         ------        -------------                                     --------
    Aircraft No.
    -----------

         1          *             *                                                 *

         2          *             *                                                 *
         3          *             *                                                 *
         4          *             *                                                 *
         5          *             *                                                 *

         6          *             *                                                 *

         7          *             *                                                 *

         8          *             *                                                 *

         9          *             *                                                 *


         UNQUOTE

3.       PREDELIVERY PAYMENTS
         --------------------

         As a result of the  rescheduling  set forth in  Paragraph  2.1,  the Buyer  will make to the Seller on
         signature of this Amendment all Predelivery Payments then due.


4.       EFFECT OF THE AMENDMENT
         -----------------------

         The Agreement will be deemed amended to the extent herein provided, and, except as specifically
         amended hereby, will continue in full force and effect in accordance with its original terms. This
         Amendment supersedes any previous understandings, commitments, or representations whatsoever,
         whether oral or written, related to the subject matter of this Amendment.

         Both  parties  agree  that this  Amendment  will  constitute  an  integral,  nonseverable  part of the
         Agreement and be governed by its  provisions,  except that if the Agreement  and this  Amendment  have
         specific provisions that are inconsistent,  the specific  provisions  contained in this Amendment will
         govern.



5.       CONFIDENTIALITY
         ---------------

         This  Amendment  is  subject  to the  confidentiality  provisions  set  forth  in  Clause  22.5 of the
         Agreement.







         IN WITNESS  WHEREOF,  the parties hereto have caused this Amendment to be executed by their respective
         officers or agents on the dates written below.




                                                              AVSA, S.A.R.L.


                                                              By: _________________

                                                              Its: _________________

                                                              Date: ________________





                                                              FRONTIER AIRLINES, INC.


                                                              By: __________________

                                                              Its: __________________

                                                              Date: ________________

EX-10.61

                                             FOUR GATEWAY CENTRE
                                               AURORA, COLORADO


                                                LEASE AGREEMENT


                                                    between


                                           GATEWAY OFFICE FOUR, LLC


                                                      and



                                            FRONTIER AIRLINES, INC.

                                            Dated December 15, 2000






                                            GATEWAY OFFICE BUILDING
                                            -----------------------

                                                 LEASE SUMMARY
                                                 -------------

1.       Landlord:                          Gateway Office Four, LLC

2.       Tenant:                            Frontier Airlines, Inc.

3.       Guarantor:                         None

4.       Premises:                          Suite No. (To be determined)

5.       Rentable Square Feet:              16,070

6.       Commencement Date:                 See Section 3.3 below

7.       Expiration Date:                   June 30, 2011

8.       Term:                              Ten (10) years following the Rent Commencement Date

9.       Rent Commencement Date:    July 1, 2001

10.      Initial Base Rent:                 $8.00/sq. ft/year NNN

11.      Increase in Base Rent:             See Section 1.2

12.      Security Deposit:          $12,427.47

13.      Tenant's Pro Rata Share
         of the Building                    25.70%

14.      Broker:                            Coldwell Banker Commercial American Spectrum

15.      Right of First Offer:              See Exhibit K


Note:    This Lease  Summary  does not in any way modify  the terms of the Lease  Agreement,  but rather is for
         information  purposes  only.  The Lease  Agreement  should be consulted for all specific  terms and in
         the event of any conflict  between this Lease  Summary and the Lease  Agreement,  the Lease  Agreement
         shall control.







                                                        -iii-
                                                LEASE AGREEMENT

                                               TABLE OF CONTENTS
                                               -----------------


ARTICLES                                                                                                       PAGE
- --------                                                                                                       ----

ARTICLE 1         DEFINITIONS.....................................................................................1
ARTICLE 2         GRANT OF LEASEHOLD ESTATE.......................................................................4
ARTICLE 3         LEASE TERM......................................................................................4
ARTICLE 4         USE OF PREMISES AND COMMON AREAS................................................................5
ARTICLE 5         BASE RENT.......................................................................................6
ARTICLE 6         ADDITIONAL RENT.................................................................................7
ARTICLE 7         BUILDING SERVICES...............................................................................8
ARTICLE 8         IMPROVEMENTS TO BE MADE BY LANDLORD.............................................................9
ARTICLE 9         MAINTENANCE AND REPAIR..........................................................................9
ARTICLE 10        SIGNAGE........................................................................................10
ARTICLE 11        CARE OF THE PREMISES BY TENANT.................................................................10
ARTICLE 12        REPAIRS AND ALTERATIONS BY TENANT..............................................................10
ARTICLE 13        UTILITIES......................................................................................11
ARTICLE 14        LAWS AND REGULATIONS...........................................................................12
ARTICLE 15        BUILDING RULES.................................................................................13
ARTICLE 16        ENTRY BY LANDLORD..............................................................................13
ARTICLE 17        ASSIGNMENT AND SUBLETTING......................................................................13
ARTICLE 18        LIENS..........................................................................................14
ARTICLE 19        INSURANCE......................................................................................15
ARTICLE 20        INDEMNITY......................................................................................16
ARTICLE 21        DAMAGE OR DESTRUCTION TO BUILDING..............................................................17
ARTICLE 22        CONDEMNATION...................................................................................17
ARTICLE 23        DAMAGES FROM CERTAIN CAUSES....................................................................18
ARTICLE 24        EVENTS OF DEFAULT..............................................................................18
ARTICLE 25        LANDLORD'S REMEDIES............................................................................19
ARTICLE 26        LANDLORD'S DEFAULT.............................................................................22
ARTICLE 27        PEACEFUL ENJOYMENT.............................................................................22
ARTICLE 28        HOLDING OVER...................................................................................22
ARTICLE 29        SUBORDINATION TO MORTGAGE......................................................................23
ARTICLE 30        Reserved.......................................................................................23
ARTICLE 31        BANKRUPTCY OR INSOLVENCY.......................................................................23
ARTICLE 32        AMERICANS WITH DISABILITIES ACT................................................................24
ARTICLE 33        ATTORNEY FEES..................................................................................25
ARTICLE 34        NO IMPLIED WAIVER..............................................................................25
ARTICLE 35        LIMITATION OF LANDLORD LIABILITY...............................................................25
ARTICLE 36        SECURITY DEPOSIT...............................................................................26
ARTICLE 37        NOTICE.........................................................................................26
ARTICLE 38        SEVERABILITY...................................................................................27
ARTICLE 39        RECORDATION....................................................................................27
ARTICLE 40        GOVERNING LAW..................................................................................27
ARTICLE 41        FORCE MAJEURE..................................................................................27
ARTICLE 42        TIME OF PERFORMANCE............................................................................27
ARTICLE 43        TRANSFERS BY LANDLORD..........................................................................27
ARTICLE 44        COMMISSIONS....................................................................................27
ARTICLE 45        EFFECT OF DELIVERY OF THIS LEASE...............................................................28
ARTICLE 46        CORPORATE AUTHORITY............................................................................28
ARTICLE 47        JOINT AND SEVERAL LIABILITY....................................................................28
ARTICLE 48        INTERPRETATION.................................................................................28
ARTICLE 49        INCORPORATION OF PRIOR AGREEMENTS; MODIFICATIONS...............................................28
ARTICLE 50        WAIVER OF JURY TRIAL...........................................................................28
ARTICLE 51        ESTOPPEL CERTIFICATES..........................................................................28
ARTICLE 52        NO MERGER......................................................................................29
ARTICLE 53        COUNTERPARTS...................................................................................29
ARTICLE 54        EQUIPMENT......................................................................................29
ARTICLE 55........PARKING................................................................................................... 30
ARTICLE 56........RESTRICTED USE.......................................................................................31
ARTICLE 57        EXHIBITS.......................................................................................31

3










                                               LIST OF EXHIBITS
                                               ----------------

                                                                                            Principal Reference
Exhibit                    Description                                                         "In Section/Article"
- -------                    -----------                                                         --------------------

"A"               Legal Description.............................................................................1.4
"B"               Floor Plan of Premises.......................................................................1.17
"C"               Operating Expenses...........................................................................1.11
                  Attachment 1 (Schematic Diagram of Parking)...................................................C-1
"D"               Work Letter.....................................................................................8
"E"               Building Rules and Regulations.................................................................15
"F"               Commencement Memorandum.......................................................................1.8
"G"               Reserved.....................................................................................31.4
"H"               Estoppel Certificate...........................................................................51
"I"               Subordination, Non-Disturbance, and Attornment Agreement.......................................51
"J"               Reserved .....................................................................................n/a
"K"               Right of First Offer ........................................................................1.17
                  Attachment 1 (First Offer Space) .............................................................K-1








                                                        -31-


                                                                                                    Tenant Initials
                                         GATEWAY OFFICE FOUR BUILDING

                                                LEASE AGREEMENT
                                                ---------------


         THIS LEASE  AGREEMENT  (the "Lease"),  is made and entered into as of the 15th day of December,  2000,
between GATEWAY OFFICE FOUR, LLC, a Colorado limited liability  company  ("Landlord"),  and FRONTIER  AIRLINES,
INC., a Colorado corporation ("Tenant").

         NOW, THEREFORE, Landlord and Tenant agree as follows:

ARTICLE 1
- ------------------
                                                  DEFINITIONS
                                                  -----------


1.1      Reserved

1.2      "Base Rent" shall be determined as follows:

(i)      During  months one (1) through  thirty-six  (36) of the Lease Term,  the Base Rent shall be calculated
using Eight Dollars ($8.00) per square foot of Rentable Area in the Premises per year.

(ii)     During months  thirty-seven  (37) through  seventy-two  (72) of the Lease Term, the Base Rent shall be
calculated  using Eight  Dollars and  Sixty-One  Cents ($8.61) per square foot of Rentable Area in the Premises
per year.

(iii)    During months  seventy-three  (73) through one hundred  twenty (120) of the Lease Term,  the Base Rent
shall be calculated using Nine Dollars and  Twenty-Eight  Cents ($9.28) per square foot of Rentable Area in the
Premises per year.

                  The Base Rent due for the first full  calendar  month  during the Lease Term shall be paid to
Landlord by Tenant on the Commencement Date.

1.3      "Building"  shall mean (i) the parcel of real  property  described in Exhibit "A" attached  hereto and
incorporated  herein;  (ii) the office  building and parking  structure  built or to be built on such parcel of
real  property;  and (iii)  any and all other  improvements  thereon  and  appurtenances  thereto.  The  street
address of the  Building  shall be  determined  prior to the  Commencement  Date;  such  street  address may be
modified by Landlord not more than once during the Lease Term.

1.4      "Building  Shell"  shall mean the  condition of the Building  completed  in  accordance  with the Base
Building Improvements as defined in the Work Letter attached hereto and incorporated herein.

1.5      "Commencement  Date" shall mean the date on which  Landlord  delivers the Premises to Tenant to enable
Tenant to complete its "Tenant Improvements" thereto in accordance with Section 3.3 below and the Work Letter.

1.6      "Commencement  Memorandum"  shall  mean a  document  similar  to  Exhibit  "F"  attached  hereto.  The
Commencement  Memorandum,  among other  things,  shall contain a reference to the Rentable Area of the Building
and the  Rentable  Area of the  Premises.  Tenant  agrees that the  Rentable  Area of the Building and Rentable
Area of the Premises stated in the Commencement Memorandum shall be binding throughout the Lease Term.

1.7      Reserved

1.8      "Laws"  shall  mean  all  applicable  statutes,  regulations,   ordinances,  requirements  and  orders
promulgated  by any federal,  state,  local or regional  governmental  authority now in force or in force after
the Commencement Date.

1.9      "Lease Term" shall mean the term  commencing on the Rent  Commencement  Date and continuing  until one
hundred  twenty  (120)  months  after the  first  day of the  first  full  calendar  month  following  the Rent
Commencement  Date;  provided,  however,  that the term of  Tenant's  and  Landlord's  rights  and  obligations
hereunder shall be subject to Tenant's early termination right set forth in Section 3.5 hereof.

1.10     "Mortgagee"  shall mean the mortgagee under a mortgage or beneficiary  under a deed of trust holding a
lien  encumbering  the  Building  or any holder of a ground  leasehold  interest  in the  Building  or any part
thereof.

1.11     "Operating  Expenses"  shall mean all costs of any kind required to operate,  clean,  equip,  protect,
light, repair,  replace, heat,  air-condition and maintain the Building "Common Areas" (as hereinafter defined)
as a first class  office  project  consistent  with  standards  adopted by  landlords  of  comparable  Class A,
single-story  office projects in the Northeast  Denver office market.  As used herein,  the term "Common Areas"
shall mean those  portions of the Building  which are not leased to and used on an  exclusive  basis by tenants
of the Building  (i.e.,  "Common  Areas"  excludes the  Premises and other  premises in the Building  leased to
tenants).  Operating  Expenses  shall  include  without  limitation,  all of the  following:  (i)  all  amounts
charged to the Building  pursuant to any  covenants,  codes,  restrictions,  or agreements  with respect to the
real  property;  (ii) Real Property  Taxes;  (iii) all costs,  charges and  surcharges  for  janitorial,  waste
disposal,  snow and ice removal and refuse removal and all other utilities and services  provided to the Common
Areas or which benefit all tenants of the Building;  (iv)  insurance  costs for which  Landlord is  responsible
under this  Lease or which  Landlord  or any  Mortgagee  deems  necessary  or  prudent;  (v) any costs  levied,
assessed or imposed  pursuant to any applicable  Laws;  (vi) the cost  (amortized  over such period as Landlord
reasonably  determines  together with interest on the  unamortized  balance at two percentage  points (2%) over
the rate of interest  announced from time to time by U. S. Bank, as its prime or reference  commercial  lending
rate) of any capital  improvements to the Building  (excluding tenant  improvements) or equipment  replacements
made by Landlord  after the  Commencement  Date that are  intended to reduce  other  Operating  Expenses or are
required by any Laws or are  necessary in order to operate the  Building at the same quality  level as prior to
such  replacement;  (vii)  costs and  expenses of  operation,  repair and  maintenance  of all  structural  and
mechanical portions and components of the Building  including,  without  limitation,  plumbing,  communication,
heating,  ventilating and air-conditioning  ("HVAC"),  and electrical and other common Building systems used by
all tenants;  (viii) all costs  incurred in the  management  and operation of the Building  including,  without
limitation,  gardening and landscaping,  maintenance of all parking areas, structures and garages,  maintenance
of signs,  resurfacing and repaving,  painting,  lighting,  cleaning, and provision of Building security;  (ix)
rental or lease  payments  paid by Landlord for rented or leased  personal  property  used in the  operation or
maintenance  of  portions  of the  Building  used by all  tenants;  (x) wages,  salaries  and other labor costs
incurred in the management and operation of the Building;  (xi) fees for required  licenses and permits;  (xii)
reasonable  legal,  accounting and other  professional  fees;  (xiii)  reasonable and appropriate  reserves for
repair and  replacement;  and (xiv) a  reasonable  allowance  to Landlord  for  management  of the Building and
supervision  of all of the  foregoing,  not to exceed the greater of (1) three and one-half  percent  (3.5%) of
the total gross  rental  revenues  derived  from the  Building,  or (2) the amount  charged for by landlords of
comparable  Class A, single story office  projects in the Northeast  Denver office  market.  If the Building is
not fully  occupied  during any portion of the Lease Term,  Landlord  shall make an  appropriate  adjustment to
Operating  Expenses for such period  employing  sound  accounting and management  principles,  to determine the
amount of Operating  Expenses that would have been incurred had the Building  been fully  occupied  during such
period  (collectively  referred to as "Grossed-Up").  Notwithstanding  the foregoing,  Operating Expenses shall
not include the items  described on Exhibit "C" attached  hereto.  Landlord's  good faith estimate of Operating
Expenses for the first year of the Building's  operation is included on Exhibit "C".  Tenant  acknowledges  and
agrees,  however,  that the  Building  has not been  constructed  as of the date of this Lease and the  amounts
shown on Exhibit "C" are estimates  only and are not binding upon  Landlord in the event that actual  Operating
Expenses differ from such estimate.

1.12     "Premises"  shall mean that space  outlined  on the floor plan  attached  to this Lease as Exhibit "B"
and  incorporated  herein.  The Premises are stipulated for all purposes to contain  Sixteen  Thousand  Seventy
(16,070)  square feet of Rentable  Area;  provided  that such square  footage may be increased  pursuant to the
Right of First Offer attached hereto as Exhibit "K."

1.13     "Real Property Taxes" shall mean and include any form of tax,  assessment,  license fee,  license tax,
business license fee, commercial rental tax, levy, charge,  penalty, tax or similar imposition,  imposed by any
authority  having the direct power to tax,  including any city,  county,  state or federal  government,  or any
school,  lighting,  drainage,  transportation,  air pollution,  environmental  or other  improvement or special
assessment  district  thereof,  as against any legal or equitable  interest of Landlord in the Building  and/or
the  Premises,  including,  but not limited to, the  following:  (i) any tax on  Landlord's  "right" to rent or
"right" to other income from the Premises or as against Landlord's  business of leasing the Premises;  (ii) any
assessment,  tax, fee, levy or charge in substitution,  partially or totally, of any assessment, tax, fee, levy
or charge  previously  included within the definition of Real Property Taxes (it is the intention of Tenant and
Landlord that all such new and increased  assessments,  taxes,  fees, levies and charges be included within the
definition of "Real Property Taxes" for the purposes of this Lease);  (iii) any  assessment,  tax, fee, levy or
charge allocable to or measured by the area of the Premises or the rent payable hereunder,  including,  without
limitation,  any gross income tax or excise tax levied by the state,  county,  city or federal  government,  or
any  political  subdivision  thereof,  with respect to the receipt of such rent, or upon or with respect to the
possession,  leasing,  operating,  management,  maintenance,  alteration,  repair,  use  or  occupancy  of  the
Building,  or any  portion  thereof;  (iv) any  assessment,  tax,  fee,  levy or charge  upon this  transaction
creating or  transferring  an interest or an estate in the  Premises;  (v) any  assessment,  tax,  fee, levy or
charge  based upon the  number of people  employed,  working  at, or using the  Premises  or the  Building,  or
utilizing  public or private  transportation  to commute to the Premises or the Building;  and (vi)  reasonable
legal and other  professional  fees,  costs and  disbursements  incurred  in  connection  with  proceedings  to
contest,  determine or reduce Real  Property  Taxes.  Real  Property  Taxes shall not include  federal or state
income,  franchise,  inheritance or estate taxes of Landlord or any of the parties which  comprise  Landlord or
tax imposed upon any transfer by Landlord of its interest in this Lease or the Building.

1.14     "Rentable Area" of the Premises shall mean Sixteen  Thousand  Seventy  (16,070) square feet subject to
adjustment  prior to the Rent  Commencement  Date,  the  amount  of which  adjustment  shall be  determined  by
Landlord's  architect within a reasonable time after construction of the demising wall, which calculation shall
include an add-on  factor equal to the Tenant's  Share of any common  areas within the  Building.  The Building
is  stipulated  for all  purposes  to contain  Sixty Two  Thousand  Five  Hundred Six  (62,556)  square feet of
Rentable Area.  Notwithstanding  the foregoing,  upon completion of construction of the Building,  the Premises
and the Building  shall be measured and  calculated  by Landlord,  at its sole cost and expense,  within ninety
(90) days after the Commencement  Date, in accordance with BOMA Publication  ANSIZ 65.1-1996 (the  "Measurement
Standard").  Landlord shall provide Tenant with backup  documentation  evidencing  such  calculation.  Upon the
determination  of the actual size of the Premises in accordance  with the  Measurement  Standard,  Landlord and
Tenant shall execute a confirmatory  amendment  setting forth the actual Rentable Area and Tenant's Share,  and
the Rent and Tenant's Share shall be adjusted accordingly, if necessary.

1.15     "Rent  Commencement  Date"  shall  mean July 1,  2001,  as the same may be  extended  pursuant  to the
provisions of Section 3.3 below.

1.16     "Security  Deposit"  shall mean the sum of Twelve  Thousand  Four Hundred  Twenty-seven  and 47/100ths
Dollars ($12,427.47).

1.17     "Tenant's  Share" shall be a fraction of which the  numerator is the Rentable  Area of the Premises as
set forth in Section  1.14 and the  denominator  is the  Rentable  Area in the Building as set forth in Section
1.14.







ARTICLE 2
- ------------------
                                           GRANT OF LEASEHOLD ESTATE
                                           -------------------------

         Subject to and upon the terms and conditions  herein set forth,  Landlord  hereby leases to Tenant and
Tenant hereby leases from  Landlord the  Premises.  Landlord  hereby leases the Premises to Tenant on a "Triple
Net"  basis.  Landlord  shall  not be  obligated  to pay any  expenses  or incur  any  liabilities  of any kind
relating to the Premises or Building during the Term,  except as specifically  assumed by Landlord  pursuant to
the terms hereof.

ARTICLE 3
- ------------------
                                                  LEASE TERM
                                                  ----------

3.1      Shell   Improvements.   Landlord  will   construct  or  install  in  the  Premises  the   improvements
contemplated by Section 4.2 of the Work Letter (the "Shell  Improvements")  prior to the Commencement Date, and
thereafter  shall complete  construction  of the "Base Building  Improvements"  (as defined in the Work Letter)
prior to the Rent Commencement  Date.  Landlord will be deemed to have delivered  possession of the Premises to
Tenant on the  Commencement  Date, as it may be adjusted  pursuant to Section 3.3 and the Work Letter,  so that
Tenant may then commence  construction of its "Tenant  Improvements" to the Premises.  Tenant acknowledges that
neither  Landlord  nor  its  agents  or  employees  have  made  any  representations  or  warranties  as to the
suitability or fitness of the Premises for the conduct of Tenant's  business or for any other purpose,  nor has
Landlord or its agents or employees  agreed to undertake any  alterations or construct any tenant  improvements
to the Premises  except as expressly  provided in this Lease and the Work  Letter.  If for any reason  Landlord
cannot  deliver  possession  of the  Premises  to  Tenant  with the  Shell  Improvements  completed  or has not
completed the Base Building  Improvements on or before the dates therefor  specified in Section 3.3 below, this
Lease will not be void or voidable  except as expressly  provided  pursuant to such Section,  and Landlord will
not be liable to Tenant for any resultant loss or damage.

3.2      Reserved.

3.3      Commencement  Date.  Landlord  covenants to use commercially  reasonable  efforts to cause substantial
completion  of (i) the Shell  Improvements  and  delivery of the  Premises  to Tenant for  purposes of Tenant's
construction  of the Tenant  Improvements  in accordance  with the Work Letter on or before April 1, 2001,  and
(ii)  substantial  completion of the Base Building  Improvements  on or before July 1, 2001. If Landlord  fails
to meet  either or both of the  foregoing  dates due to  default  on the part of  Landlord  (as  determined  in
accordance  with Article 26 below) or as a result of the  occurrence of events of force majeure as described in
Article 41 below,  then as Tenant's sole remedies for the delay in Tenant's  taking  possession of the Premises
or the completion of the Base Building  Improvements,  (a) Tenant shall be entitled to one (1) day of free Rent
in the Premises  for each day that  Landlord  fails to timely  deliver the Shell  Improvements  and/or the Base
Building  Improvements as required  herein (the "Free Rent Period");  (b) the Rent  Commencement  Date shall be
delayed for the period of delay in  substantial  completion of the Shell  Improvements  and/or  delivery of the
Premises,  as applicable,  resulting from Landlord's  default and for the duration of the Free Rent Period; and
(c) the  Expiration  Date of the Lease  Term  shall  likewise  be  extended;  provided,  that in the event that
substantial  completion of the Shell  Improvements and delivery of the Premises and/or  substantial  completion
of the Base Building  Improvements  has not occurred on or before January 1, 2002 due to default on the part of
Landlord  (determined in accordance  with Article 26 below) or as a result of the occurrence of events of force
majeure as  described in Article 41 below,  then Tenant  shall have the right to terminate  this Lease upon ten
(10) days' prior written notice to Landlord.  The date on which Landlord  actually  delivers  possession of the
Premises to Tenant in accordance with the foregoing is referred to herein as the "Commencement Date."

3.4      Term.  The term of this Lease is the Lease Term.

3.5      Option  to  Terminate.  Provided  Tenant  is not in  default  of its  obligations  under the Lease and
Tenant has not assigned its rights under the Lease (except as permitted  pursuant to Article 17 below),  Tenant
shall have the option to terminate this Lease ("Option to Terminate")  after  completion of the sixtieth (60th)
month of the Lease Term upon the following  terms and conditions.  In order to effectively  exercise the Option
to Terminate,  Tenant shall deliver written notice of its exercise of the Option to Terminate,  to be effective
twelve (12) months  following  such  exercise,  and shall pay a  termination  fee equal to the sum of (1) three
months Rent effective as of the date of such notice,  and (2) all unamortized  leasing  commissions of Landlord
due in connection with this Lease,  all as reasonably  determined by Landlord using an interest rate of 11% per
annum.  In the event  Tenant  delivers  its notice  that it has elected to  exercise  the Option to  Terminate,
Landlord  shall  deliver to Tenant,  Landlord's  determination  of the  termination  fee.  Tenant shall pay the
termination fee to Landlord within thirty (30) days after receipt of Landlord's  determination  of such fee, at
which time this Lease shall be deemed  terminated  with no further  obligation  on the part of either  party to
the other except for those  obligations  which  specifically  survive the expiration or earlier  termination of
this Lease.  The Option to Terminate shall be null and void if any of the following  occur: (i) Tenant fails to
pay the  termination fee within the time period  provided  herein,  or (ii) Tenant assigns its rights under the
Lease.

ARTICLE 4
- ------------------
                                       USE OF PREMISES AND COMMON AREAS
                                       --------------------------------

4.1      Premises.   The  Premises  shall  be  used  for  general  and  administrative   office  purposes  with
communication  support  capabilities  (i.e. as a  reservation  call center) and for no other  purposes.  Tenant
will use the Premises in a careful,  safe,  and proper  manner.  Tenant  agrees not to use or permit the use of
the Premises for any purpose  which is illegal or  prohibited by any  applicable  law, or which,  in Landlord's
reasonable  opinion,  creates a nuisance or would  materially  increase  the cost of  insurance  coverage  with
respect  to the  Building.  Tenant  shall  not use or  occupy  the  Premises  in  violation  of such  rules and
regulations  described in Article 15 below nor in violation of any other laws, recorded  covenants,  conditions
or  restrictions  affecting  the  Building.  Tenant  shall have access to the  Premises  for the use  permitted
hereunder twenty-four (24) hours per day, three hundred sixty-five (365) days per year.

4.2      Common  Areas of  Building.  Tenant  shall  have the  nonexclusive  right to use in common  with other
tenants  in the  Building,  and  subject to the rules of the  Building  referred  to in  Article15  below,  the
following areas ("Common Areas")  appurtenant to the Premises:  (i) the common  entrances,  lobbies,  restrooms
and accessways,  loading docks,  ramps, drives and platforms and any passageways and serviceways  thereto,  and
the common pipes,  conduits,  wires and  appurtenant  equipment  serving the  Premises;  and (ii) parking areas
(subject to such reasonable  rules and regulations  relating thereto as may be adopted by Landlord from time to
time),  loading and unloading  areas,  trash areas,  roadways,  sidewalks,  walkways,  parkways,  driveways and
landscaped areas appurtenant to the Building.

4.3      Landlord's  Rights  in  Common  Areas.   Landlord  reserves  the  right  from  time  to  time  without
unreasonable  interference  with  Tenant's  use or  Tenant's  access  to the  Premises:  (i) to  install,  use,
maintain,  repair and replace pipes,  ducts,  conduits,  wires and appurtenant meters and equipment for service
to other parts of the Building above the ceiling  surfaces,  below the floor surfaces,  within the walls and in
the  central  core  areas,  and to  relocate  any pipes,  ducts,  conduits,  wires and  appurtenant  meters and
equipment  included  in the  Premises  which are  located in the  Premises  or located  elsewhere  outside  the
Premises,  and to  expand  the  Building;  (ii)  to  make  changes  to the  Common  Areas,  including,  without
limitation,  changes in the location,  size,  shape and number of driveways,  entrances,  loading and unloading
areas,  ingress,  egress,  direction  of traffic,  landscaped  areas and walkways  and,  subject to the Parking
Agreement,  parking  spaces  and  parking  areas;  (iii) to  close  temporarily  any of the  Common  Areas  for
maintenance  purposes so long as reasonable  access to the Premises remains  available;  (iv) to use the Common
Areas while engaged in making additional  improvements,  repairs or alterations to the Building, or any portion
thereof;  and (v) to do and perform  such other acts and make such other  changes in, to or with respect to the
Common Areas and Building as Landlord may, in the exercise of sound business judgment, deem to be appropriate.

4.4      Prohibited Use of Common Areas.  Tenant may not display or sell  merchandise or allow portable  signs,
devices  or any other  objects  to be  stored  or to remain  outside  the  defined  exterior  walls or roof and
permanent  doorways of the Premises.  In addition,  Tenant shall not solicit by handbills,  bumper  stickers or
other  advertising  devises,  in any  manner,  in the  parking  areas  or  Common  Areas  of the  Building.  No
advertising medium may be used by Tenant which can be heard or experienced outside the Premises.

4.5      Affirmative  Covenants  of Tenant.  Without in any way  limiting or  restricting  other  covenants  of
Tenant elsewhere in this Lease contained, the Tenant affirmatively covenants and agrees as follows:

                  a.       Tenant shall neither  permit or suffer any conduct,  noise,  odor or other  nuisance
about the Premises to annoy or disturb any persons occupying adjacent premises or Common Areas;

                  b.       Tenant shall keep the Premises  including all service  and/or  loading areas for the
Premises free from all litter,  dirt and  obstructions,  and shall not advertise  within the Building or Common
Areas except as designated by Landlord.

                  c.       Tenant shall  arrange for and accept  deliveries  only at such times,  in the areas,
and through the entrances designated for such purpose by Landlord.

                  d.       Tenant  shall keep the  Premises  clean and in the  sanitary  condition  required by
ordinance and regulations of any governmental or quasi-governmental unit having jurisdiction;

                  e.       Tenant  shall  neither  permit  or  suffer  the  Premises,  or the  walls or  floors
thereof, to be endangered by overloading; and

                  f.       Tenant shall  properly  maintain the HVAC system in the Premises  including,  at the
option of Landlord,  subscribing  to a service  selected by Landlord for such  maintenance  and paying the fees
therefor.

4.6      Garbage and Refuse  Collection.  Tenant  shall keep all  garbage and refuse in the kind of  containers
designated  by Landlord  which  Tenant  shall place  outside of the Premises  prepared  for  processing  and/or
collection  in  such  manner  and  at  such  times  and  places  specified  by  Landlord.  Landlord  shall  use
commercially  reasonable  efforts  to  contract  with a garbage  disposal  company  which  implements  a refuse
recycling  program at the Building so long as  implementation of such recycling program does not (i) materially
increase the cost of providing refuse  collection and disposal at the Building,  or (ii) conflict with or cause
cancellation of Landlord's  refuse  collection and disposal  contracts for other properties within the vicinity
of the  Building  which may include  the  Building  and other  properties  owned by  Landlord on an  "umbrella"
contract basis.

ARTICLE 5
- ------------------
                                                   BASE RENT
                                                   ---------

5.1      Base Rent.  Tenant  agrees to pay to Landlord  during the Lease Term,  without any setoff or deduction
whatsoever  the Base Rent,  and all such other sums of money as shall become due hereunder as Additional  Rent.
Should Tenant fail to pay any Additional  Rent in a timely  manner,  Landlord shall be entitled to exercise all
such rights and remedies as are herein  provided in the case of the  nonpayment  of Base Rent.  The annual Base
Rent for each calendar year or portion thereof during the Lease Term,  together with estimated  Additional Rent
pursuant  to Article 6 hereof  then in effect,  shall be due and  payable in  advance,  in lawful  money of the
United  States  of  America  which  shall  be legal  tender  at the  time of  payment,  in  twelve  (12)  equal
installments  on the first day of each  calendar  month  during the initial  Lease Term and any  extensions  or
renewals  thereof,  and  Tenant  hereby  agrees  to pay such  Base  Rent and  Additional  Rent to  Landlord  at
Landlord's  address  provided  herein (or such other  address as may be  designated by Landlord in writing from
time to time)  monthly,  in advance,  and without  demand.  If the Lease Term commences on a day other than the
first day of a month or terminates on a day other than the last day of a month,  then the  installments of Base
Rent and  Additional  Rent for such  month or months  shall be  prorated,  based on the  number of days in such
month.  The first monthly installment of Base Rent shall be due and payable on the Commencement Date.

5.2      Additional  Rent. All charges  payable by Tenant  hereunder other than Base Rent  (including,  without
limitation,  Taxes,  utilities  charges,  if applicable,  and Operating  Expenses payable pursuant to Article 6
below) are called  "Additional Rent." Unless this Lease provides  otherwise,  all Additional Rent shall be paid
with the next  monthly  installment  of Base Rent.  Base Rent and  Additional  Rent are  sometimes  referred to
collectively as "Rent."

5.3      Interest and  Administrative  Charges on Late  Payments.  All  installments  of Rent not paid when due
and payable  shall bear  interest and incur the  administrative  charges as set forth  hereinbelow.  Landlord's
acceptance  of any late charge or interest  shall not  constitute a waiver of Tenant's  default with respect to
the overdue  amount nor prevent  Landlord  from  exercising  any of the other rights and remedies  available to
Landlord under this Lease or any law now or hereafter in effect.

ARTICLE 6
- ------------------
                                                ADDITIONAL RENT
                                                ---------------

         Commencing on the  Commencement  Date,  Tenant shall pay for Tenant's Share of all expenses related to
the Building,  except for those expenses  specifically  excluded from the  definition of Operating  Expenses in
Section 1.11 hereof, including, but not limited to the following:

6.1      Operating  Expenses and Taxes.  Tenant shall pay to Landlord as  Additional  Rent in  accordance  with
the  payment  provision  provided  herein,  Tenant's  Share of the total  annual  Operating  Expenses  and Real
Property  Taxes.  Such amount shall be paid in advance in monthly  installments  on the same dates as Base Rent
is due and payable  hereunder  based on Landlord's  notice  delivered to Tenant from time to time setting forth
Landlord's  good faith estimate of the Operating  Expenses for the current  calendar year.  Landlord shall have
the right to  prospectively  adjust such  amount no more than once a year to reflect any changes in  Landlord's
estimate of Operating Expenses.

6.2      Annual  Statement of Operating  Expenses.  By April 1 of each  calendar year during the Lease Term, or
as soon  thereafter  as  practicable  but no later than May 1,  Landlord  shall  furnish to Tenant a  statement
("Actual  Statement")  of Landlord's  annual  Operating  Expenses,  for the previous  calendar year. If for any
calendar  year the amounts  collected  from Tenant for the prior year,  as a result of  Landlord's  estimate of
Operating  Expenses,  exceeds the amount of the Operating  Expenses  actually due during such prior year,  then
Landlord shall refund to Tenant any  overpayment (or at Landlord's  option,  apply such amount against Rent due
or to  become  due  hereunder).  Likewise,  Tenant  shall pay to  Landlord,  on  demand,  any  underpayment  of
Operating  Expenses  with respect to the prior year with the first Base Rent payment  payable  after receipt of
the Actual Statement.

6.3      Audit  Right.  In the event of any good faith  dispute as to the amount of the  Operating  Expenses as
set forth in the  Actual  Statement  of  actual  Operating  Expenses,  Tenant  shall  have the  right,  no more
frequently  than once per  calendar  year,  after notice to Landlord and at  reasonable  times,  to inspect and
photocopy  Landlord's  Operating  Expenses  records  at  Landlord's  offices.  If,  after such  inspection  and
photocopy,  Tenant  continues,  in good faith, to dispute the amount of Operating  Expenses as set forth in the
Actual  Statement,  Tenant shall be entitled not later than ninety (90) days following  Tenant's  receipt of an
Actual  Statement to retain a national,  independent,  certified  public  accountant who is not contracted on a
contingency  fee basis and is  mutually  acceptable  to  Landlord  and  Tenant  to audit  Landlord's  Operating
Expenses  records with respect to the calendar year covered by Actual  Statement to determine the proper amount
of  Operating  Expenses.  Landlord  shall be  entitled  to review  the  results of such  audit  promptly  after
completion  of same.  If the results of such audit states that  Landlord has  overcharged  Tenant,  then within
fifteen (15) days after the results of the audit are made  available to Landlord,  Landlord shall credit Tenant
the amount of such  overcharge  toward the payments of Base Rent and Additional Rent next coming due under this
Lease.  If such audit proves that Landlord has  undercharged  Tenant,  then within  fifteen (15) days after the
results  of the audit are made  available  to  Tenant,  Tenant  shall pay to  Landlord  the  amount of any such
undercharge.  Tenant agrees to pay the cost of such audit,  provided that Landlord shall  reimburse  Tenant the
amount of such cost if the  results  of such  audit  states  that  Landlord's  determination  of the  Operating
Expenses (as set forth in the Actual  Statement)  was in error by more than ten percent  (10%).  If Tenant does
not request an audit in accordance  with the  provisions of this Section 6.3 within one (1) year after Tenant's
receipt of an Actual  Statement,  such Actual  Statement  shall be conclusively  binding upon Tenant.  Landlord
shall be required to maintain  records of all Operating  Expenses for Four (4) years  following the issuance of
the Operating  Expense  statement for such Operating  Expenses.  The payment by Tenant of any amounts  pursuant
to this Article shall not preclude Tenant from timely questioning the correctness of any such statement.

6.4      Utilities.  Tenant  shall  pay,  as and  when  billed  by the  applicable  utility  service,  for gas,
electricity,  heating,  air conditioning and ventilating  directly to the utility providing such service to the
Premises,  and shall pay Tenant's Share of all other utility  services  furnished for use in the Premises or to
operate any of  Tenant's  signs  which are not  separately  metered to the  Premises.  Tenant  agrees to pay to
Landlord  monthly as a separate  charge for any utility  services  furnished  to Tenant or the Premises but not
separately  metered to the Premises  such amount as shall be due in  accordance  with the rates as  established
from time to time in the then current  schedule of rates of Landlord for supplying  said  utilities,  but in no
event shall said rate  exceed  that for which  Tenant  would be charged  should it obtain any of said  services
directly from the same third party supplier thereof.

6.5      Confidentiality.  Tenant will keep  confidential all agreements  involving the rights provided in this
section and the results of any audits  conducted  hereunder.  Notwithstanding  the  foregoing,  Tenant shall be
permitted  to furnish the  foregoing  information  to its  attorneys,  accountants  and  auditors to the extent
necessary for such persons to perform their  respective  services for Tenant,  provided  such  permitted  party
agrees in writing to keep all audit information confidential.

ARTICLE 7
- ------------------
                                               BUILDING SERVICES
                                               -----------------

         Landlord  agrees to furnish  Tenant the  following  services as an Operating  Expense for the Building
(except as specifically provided below):

7.1      Gas,  Water   Sewer Service.  All gas, water and sewer at those points of supply  provided for general
use of other tenants in the Building.

7.2      Routine  Maintenance.  Routine  maintenance  and  electric  lighting  service for all Common Areas and
service  areas of the  Building  in the manner and to the extent  reasonably  deemed by Landlord to be standard
for the Building (hereinafter defined as "Building Standard").

7.3      Reserved.

7.4      Base  Electricity.  Subject to the  provisions  of Article 13,  facilities  to provide all  electrical
current  required by a typical office user, as reasonably  determined by Tenant's  electrical  engineers and by
Landlord, in its use and occupancy of the Premises.

7.5      Light  Maintenance.   All  Building  Standard   fluorescent  bulb  replacement  in  the  Premises  and
fluorescent and incandescent bulb replacement in the Common Areas of the Building.

7.6      Access  Cards.  Tenant,  at its sole  cost and  expense,  shall  provide  a system  for  access to the
Premises.  Landlord  shall have no liability  to Tenant,  its  employees,  agents,  invitees or  licensees  for
losses due to theft or  burglary,  or for damages  resulting  from the actions of  unauthorized  persons on the
Premises or in the  Building  and  Landlord  shall not be required to insure  against any such  losses.  Tenant
shall  cooperate  fully in  Landlord's  efforts to  maintain  security  in the  Building  and shall  follow all
regulations promulgated by Landlord which respect thereto.

         The  failure by  Landlord  to any extent to  furnish,  or the  interruption  or  termination  of these
defined  services  in whole or part shall not render  Landlord  liable in any respect  nor be  construed  as an
eviction of Tenant,  nor work an  abatement  of Rent,  nor relieve  Tenant from the  obligation  to fulfill any
covenant  or  agreement  hereof.  Should  any of the  equipment  or  machinery  used in the  provision  of such
services for any cause cease to function  properly,  Tenant shall have no claim for offset or abatement of Rent
or damages on account of an interruption in service resulting therefrom.

ARTICLE 8
- ------------------
                                      IMPROVEMENTS TO BE MADE BY LANDLORD
                                      -----------------------------------

         Except as otherwise  provided in the Work Letter  attached  hereto as Exhibit  "D," all  installations
and  improvements  now or hereafter  placed on the Premises shall be for Tenant's  account and at Tenant's cost
(and  Tenant  shall  pay ad  valorem  taxes  and the  cost  of any  increased  insurance  premiums  thereon  or
attributable  thereto),  which cost shall be payable by Tenant to Landlord upon demand as  Additional  Rent. In
addition,  in the event that the  improvements  to the Premises are of greater cost than of a typical tenant in
the Building,  as reasonably  determined  by Landlord,  such that the Real Property  Taxes for the Building are
greater  than they  would  otherwise  be, or in the event that any other  improvements  to the  Premises  cause
assessment  of such  greater  taxes,  Tenant  shall be required to pay such excess tax amount  promptly at such
times as Landlord shall from time to time designate.

ARTICLE 9
- ------------------
                                            MAINTENANCE AND REPAIR
                                            ----------------------

9.1       Maintenance  by Tenant.  Tenant shall,  at its sole cost and expense,  furnish,  maintain and replace
all  electric  light  bulbs,  tubes,  ballasts  and tube  casings in the Premises and keep the Premises in good
repair and  condition  and make all needed  repairs  and  replacements  therein or thereto,  including  without
limitation  replacement of cracked or broken glass,  and  maintenance  and repair of the heating,  ventilating,
and air  conditioning  systems in  accordance  with Section 9.3 below ("HVAC  System")  servicing the Premises,
except for repairs  required to be made by Landlord  under Section 9.2 below,  keep all plumbing  units,  pipes
and  connections  in the Premises  free from  obstruction  and protected  against ice and  freezing,  and shall
maintain in good order and repair,  and in a clean and sanitary  condition,  and  replace,  as  necessary,  all
portions of the Premises,  including  storefronts,  window and door frames and cases,  security  grills,  plate
glass,  wall and floor  coverings.  Tenant shall also repair,  at its sole  expense,  any damage in  connection
with any burglary or forcible  entry into the  Premises.  If any repairs  required to be made by Tenant are not
commenced  within ten (10) days after  written  notice is delivered  to Tenant by Landlord  (unless the repairs
are  required as a result of an actual or apparent  emergency,  in which event no prior  notice need be given),
and thereafter  diligently  prosecuted to completion,  Landlord may, at its option,  make such repairs  without
liability  to Tenant for any  reasonable  loss or damage  which may result to  Tenant's  stock or  business  by
reason of such repairs,  and Tenant shall pay to Landlord  immediately upon demand as Additional Rent hereunder
the cost of such repairs plus ten percent (10%) of the amount  thereof,  and failure to do so shall  constitute
an event of default by Tenant.

9.2      Maintenance  by  Landlord.  Landlord  shall,  subject  to  reimbursement  as  part  of the  Building's
Operating Expenses,  keep the foundation,  the structural and exterior walls (except store fronts,  plate glass
windows,  doors,  door closure  devices,  window and door frames,  molding,  locks and hardware and painting or
other  treatment of interior  walls) and the roof of the Premises in good repair,  except that  Landlord  shall
not be  required  to make any  repairs  caused  by the act or  negligence  of  Tenant,  its  agents,  invitees,
employees,  subtenants,  assignees,  licensees  and  concessionaires,  or  necessitated  by  any  improvements,
alterations  or  additions  made by or on behalf of Tenant  (whether or not  consented to by  Landlord),  which
repairs  shall be made by Tenant (or, at  Landlord's  option,  by Landlord at Tenant's  expense).  In the event
that the  Premises  should  become in need of  repairs  required  to be made by  Landlord,  Tenant  shall  give
immediate  written  notice to Landlord and Landlord shall not be responsible in any way for failure to make any
such repairs until a  commercially  reasonable  time period shall have elapsed  after  delivery of such written
notice.  Landlord's  obligation  hereunder  is limited to  repairs  specified  in this  Section  9.2 only,  and
Landlord shall have no liability for any damages or injury  arising out of any condition or occurrence  causing
a need for those repairs, unless otherwise specifically provided for herein.

         9.3      HVAC System  Contract.  Tenant  shall,  throughout  the Lease Term, at Tenant's sole cost and
expense,  obtain and keep in force a preventative  maintenance service contract ("Service  Contract"),  in form
and content and with a contractor  reasonably  acceptable to Landlord, on the HVAC System and related equipment
servicing the Premises.  Tenant shall provide a copy of the Service  Contract to Landlord  within 10 days after
the  Commencement  Date and thereafter upon request.  Landlord may, at any time during the Lease Term, elect to
obtain a common or master  preventative  maintenance  service  contract  covering the HVAC systems of more than
one tenant  premises  within the Building,  in which event,  Tenant shall no longer be required to maintain its
own Service  Contract and in lieu  thereof,  Tenant shall pay to Landlord  Tenant's  Share of the costs of such
common or master service contract as part of Operating Expenses.

ARTICLE 10
- ------------------
                                                    SIGNAGE
                                                    -------

         Landlord  shall  provide  and  install,  at  Tenant's  cost,  all  letters or numerals on doors in the
Premises;  all such  letters and  numerals  shall be in the  standard  graphics  for the Building and no others
shall be used or permitted on the Premises  without  Landlord's  prior written  consent.  Landlord shall allow,
exterior monument signage  incorporating  Tenant's trade name and logo to be erected by Tenant at Tenant's sole
cost and expense,  at a reasonable  location  selected by Landlord,  provided,  such signage  shall comply with
Landlord's  signage  regulations as may be in effect from time to time and Tenant, at its sole cost and expense
shall be solely  responsible for obtaining any required  approvals for its signage,  including the approvals of
the City and County of Denver and the Gateway Park Design Review  Committee.  Failure to obtain such  approvals
shall not render  this Lease void or  voidable,  and  Landlord  will not be liable to Tenant for any  resultant
loss or damage.  Except as set forth above,  Tenant shall not erect any  exterior  sign or any interior  window
or door signs  visible from the exterior of the Premises  without first  obtaining  the written  consent of the
Landlord.

ARTICLE 11
- ------------------
                                        CARE OF THE PREMISES BY TENANT
                                        ------------------------------

         Tenant  agrees not to commit or allow any waste to be  committed on any portion of the  Premises,  and
at the  termination  of this Lease agrees to deliver up the Premises to Landlord in as good condition as at the
Commencement Date of this Lease, ordinary wear and tear excepted.

ARTICLE 12
- ------------------
                                       REPAIRS AND ALTERATIONS BY TENANT
                                       ---------------------------------

12.1     No  Alteration,   Additions,  or  Improvements  Without  Landlord's  Consent.  Tenant  shall  make  no
alterations,  additions,  or  improvements  to the  Premises or any part  thereof  (hereinafter  referred to as
"Alterations")  without  obtaining  the  prior  written  consent  of  Landlord,  which  consent  shall  not  be
unreasonably  withheld;  provided,  that Landlord's consent shall not be required where such Alterations (i) do
not affect the  structural  components  or equipment  systems of the  Building,  (ii) do not require a building
permit to perform,  (iii) do not increase the load on the Building systems or structural  components,  (iv) are
completed in accordance  with all  applicable  laws,  and (v) do not cost in excess of $32,000 in the aggregate
to  complete  . Tenant  shall  submit  any such  request  to  Landlord  at least  thirty  30) days prior to the
proposed  commencement  date of such  work.  Landlord  may  impose,  as a  condition  to such  consent,  and at
Tenant's sole cost,  such  requirements  as Landlord may deem  necessary in its  judgement,  including  without
limitation,  the manner in which the work is done,  a right of approval of the  contractor  by whom the work is
to be  performed  and the  times  during  which  the work is to be  accomplished,  approval  of all  plans  and
specifications  and the  procurement  of all licenses and permits.  Landlord  shall be entitled to post notices
on and about the Premises with respect to Landlord's  non-responsibility  for mechanics' liens and Tenant shall
not permit  such  notices to be  defaced  or  removed.  Tenant  further  agrees not to connect  any  apparatus,
machinery or device to the Building systems,  including electric wires,  water pipes, fire safety,  heating and
mechanical systems, without the prior written consent of Landlord.

12.2     Completion of Lease Term.  All  Alterations to the Premises,  including,  by way of  illustration  but
not by limitation,  all counters,  screens, grilles, special cabinetry work, partitions,  paneling,  carpeting,
drapes  or other  window  coverings  and light  fixtures,  shall be  deemed a part of the real  estate  and the
property of Landlord and shall  remain upon and be  surrendered  with the  Premises as a part  thereof  without
molestation,  disturbance  or injury  at the end of the  Lease  Term,  whether  by lapse of time or  otherwise,
unless Landlord,  at the time any such Alterations are approved by Landlord,  notifies Tenant that Tenant shall
be required to remove all or any of such  Alterations at the end of the Lease Term,  and in such event,  Tenant
shall  promptly  remove,  as its sole cost and  expense,  such  Alterations  and  restore  the  Premises to the
condition in which the Premises were prior to the making of the same,  reasonable  wear and tear excepted.  Any
such  removal,  whether  required or  permitted by Landlord,  shall be at Tenant's  sole cost and expense,  and
Tenant  shall  restore the  Premises to the  condition  in which the  Premises  were prior to the making of the
same, reasonable wear and tear excepted.  All movable partitions,  machines,  and equipment which are installed
in the Premises by or for Tenant,  without expense to Landlord,  and can be removed without  structural  damage
to or  defacement  of the  Building or the  Premises,  and all  furniture,  furnishings  and other  articles of
personal  property  owned by Tenant and  located in the  Premises  (all of which are  herein  called  "Tenant's
Property")  shall be and remain the  property  of Tenant and may be removed by it at any time  during the Lease
Term.  However,  if any of Tenant's  Property is removed,  Tenant shall repair or pay the cost of repairing any
damage to the Building or the Premises  resulting from such removal.  All additions or  improvements  which are
to be surrendered  with the Premises shall be surrendered with the Premises,  as a part thereof,  at the end of
the Lease Term or the earlier termination of this Lease.

12.3     Parties  Performing  Alteration,  Repair, and Modification Work. If Landlord permits persons requested
by Tenant to perform any alterations,  repairs modifications,  or additions to the Premises,  then prior to the
commencement  of any such work,  Tenant shall deliver to Landlord  certificates  issued by insurance  companies
qualified to do business in the state where the Premises are located  evidencing  that workmen's  compensation,
public  liability  insurance,  and property damage  insurance,  all in amounts,  with  companies,  and on forms
satisfactory to Landlord,  are in force and maintained by all such  contractors and  subcontractors  engaged by
Tenant to perform  such work.  All such  policies  shall  name  Landlord  as an  additional  insured  and shall
provide that the same may not be canceled or modified without thirty (30) days' prior notice to Landlord.

12.4     Performance  of Alteration,  Repair,  and  Modification  Work.  Tenant,  at its sole cost and expense,
shall cause any permitted alterations, decorations,  installations,  additions, or improvements in or about the
Premises  to  be  performed  in  compliance  with  all  applicable  requirements  of  insurance  bodies  having
jurisdiction,  and in such manner as not to  interfere  with,  delay,  or impose any  additional  expense  upon
Landlord in the  construction,  maintenance,  or operation of the  Building,  and so as to maintain  harmonious
labor relations in the Building.  Prior to commencement of any  construction,  Tenant shall afford Landlord the
opportunity  to post a "notice of  non-liability"  of Landlord with respect to any  mechanic's  liens which may
arise with respect to such work.

ARTICLE 13
- ------------------
                                                   UTILITIES
                                                   ---------

                  Tenant,  at Tenant's sole cost and expense,  shall provide for electric  current,  heat, gas,
ventilation  and air  conditioning,  and  janitorial  service to the  Premises,  shall cause the Premises to be
separately  metered for all  utilities  contracted  for directly by Tenant,  and shall pay all charges for such
services directly to the utility company or janitorial service providing such utilities or services.

ARTICLE 14
- ------------------
                                             LAWS AND REGULATIONS
                                             --------------------

14.1     General.  Landlord  hereby  represents  and warrants to Tenant that Landlord  shall cause the Building
(excluding the Premises other than the Building  Shell) to be constructed in accordance  with all  governmental
laws,  ordinances  and  regulations  applicable  to the  Building at the time of the  approval of the  building
permit for the  Building by the City and County of Denver.  Landlord  further  represents  that it has received
no notice from any governmental  authority having  jurisdiction  over the Building of any pending or threatened
land use,  zoning,  condemnation,  eminent  domain or other  proceeding  affecting  the  Building  which  would
preclude  Landlord's  performance of its obligations  under this Lease.  Tenant,  at its sole cost and expense,
will  promptly  comply  with  all  laws,  statutes,   ordinances,  and  governmental  rules,  regulations,   or
requirements now in force or in force after the  Commencement  Date, with the requirements of any board of fire
underwriters  or other  similar  body  constituted  now or after  the date,  with any  direction  or  occupancy
certificate  issued  pursuant to any law by any public  officer or officers,  as well as with the provisions of
all recorded documents  affecting the Premises,  insofar as they relate to the condition,  use, or occupancy of
the Premises.

14.2     Hazardous Materials.

a.       For  purposes  of this Lease,  "Hazardous  Materials"  means any  explosives,  radioactive  materials,
hazardous  wastes,  or hazardous  substances,  including without  limitation  substances  defined as "hazardous
substances" in the Comprehensive  Environmental  Response,  Compensation and Liability Act of 1980, as amended,
42 U.S.C.ss.ss.9601-9657;  the Hazardous  Materials  Transportation  Act of 1975,  49 U.S.C.ss.ss.1801-1812;  the
Resource Conservation and Recovery Act of 1976, 42 U.S.C.ss.ss.6901-6987;  or any other federal,  state, or local
statute,  law,  ordinance,  code,  rule,  regulation,  order,  or decree  regulating,  relating to, or imposing
liability or standards of conduct  concerning  hazardous  materials,  waste,  or substances  now or at any time
hereafter in effect  (collectively,  "Hazardous  Materials  Laws").  Landlord hereby represents and warrants to
Tenant that Landlord (i) shall not knowingly use any Hazardous  Materials in the  construction of the Building;
(ii)  has not  released  any  Hazardous  Materials  on the  real  estate  upon  which  the  Building  shall  be
constructed;  and (iii) has received no notice from any  governmental  authority having  jurisdiction  over the
Building that the Building  (including the land included within the definition of "Building"  contained in this
Lease) is in violation of any Hazardous Materials Laws.

b.       Tenant  will not cause or permit  the  storage,  use,  generation,  or  disposition  of any  Hazardous
Materials  in, on, or about the  Premises or the  project by Tenant,  its agents,  employees,  or  contractors;
provided,  however,  that the consent of Landlord  shall not be required  for the use at the Premises by Tenant
of the  "Supplemental  Equipment"  described in Article 54 below or the standard cleaning  supplies,  toner for
photocopying  machines and other similar materials,  in containers and quantities  reasonably necessary for and
consistent  with normal and ordinary use by Tenant in the routine  operation or maintenance of Tenant's  office
equipment or in the routine  janitorial  service,  cleaning and  maintenance of the Premises or as required for
the normal use and operation of the Supplemental  Equipment,  provided that such Supplemental Equipment and any
and all such  Hazardous  Materials  are used,  kept and  maintained  in strict  compliance  with all  Hazardous
Materials  Laws.  Tenant  will not permit the  Premises  to be used or  operated in a manner that may cause the
Premises or the project to be contaminated by any Hazardous  Materials in violation of any Hazardous  Materials
Laws.  Tenant will immediately  advise Landlord in writing of (1) any and all enforcement,  cleanup,  remedial,
removal,  or other  governmental or regulatory actions  instituted,  completed,  or threatened  pursuant to any
Hazardous Materials Laws relating to any Hazardous  Materials  affecting the Premises;  and (2) all claims made
or threatened by any third party against Tenant,  Landlord,  or the Premises relating to damage,  contribution,
cost  recovery,  compensation,  loss,  or  injury  resulting  from any  Hazardous  Materials  on or  about  the
Premises.  Without  Landlord's  prior written  consent,  Tenant will not take any remedial action or enter into
any agreements or  settlements  in response to the presence or  remediation of any Hazardous  Materials in, on,
or about the Premises.

c.       Tenant will be solely  responsible for and will defend,  indemnify and hold Landlord,  its agents, and
employees  harmless from and against all claims,  costs,  and liabilities,  including  attorney fees and costs,
arising out of or in connection  with  Tenant's  breach of its  obligations  in this Article 14. Tenant will be
solely responsible for and will defend,  indemnify,  and hold Landlord, its agents, and employees harmless from
and against any and all claims,  costs, and liabilities,  including attorney fees and costs,  arising out of or
in connection with the removal,  cleanup,  and restoration work and materials  necessary to return the Premises
and any other property of whatever nature located in, on, or about the Building,  to their  condition  existing
prior to the  introduction of Hazardous  Materials by Tenant,  its agents,  employees or contractors.  Tenant's
obligations  under this Article 14 will survive the  expiration  or other  termination  of this Lease.  Without
limiting the  generality of the  foregoing,  Landlord  agrees that Tenant shall not be liable for any Hazardous
Materials  introduced  into,  on or about the Building  prior to the date Tenant first takes  possession of the
Premises.

14.3     Certain  Insurance  Risks.  Tenant will not do or permit to be done any act or thing upon the Premises
or the  Building  which would (i)  jeopardize  or be in conflict  with fire  insurance  policies  covering  the
Building or covering  any  fixtures  and property in the  Building;  (ii)  increase the rate of fire  insurance
applicable  to the  Building to an amount  higher  than it  otherwise  would be for  general  office use of the
Building;  or (iii) subject Landlord to any liability or responsibility  for injury to any person or persons or
to property by reason of any business or operation being carried on upon the Premises.

ARTICLE 15
- ------------------
                                                BUILDING RULES
                                                ---------------

         Tenant will comply with the rules of the  Building  adopted and altered by Landlord  from time to time
and will cause all of its agents,  employees,  invitees  and  visitors to do so; all changes to such rules will
be sent by Landlord to Tenant in writing.  The current  Building Rules and  Regulations,  which may be modified
from time to time by the Landlord in its sole but reasonable  discretion,  are attached  hereto as Exhibit "E."
Any rules and  regulations  imposed by  Landlord  after the date of this Lease  shall be (i)  reasonable,  (ii)
subject to the other  provisions  of this Lease,  (iii)  uniformly  enforced,  and (iv)  unless  related to the
safety or welfare of tenants of the  Building,  effective  only after  Tenant has had at least thirty (30) days
prior written notice of their enactment.

ARTICLE 16
- ------------------
                                               ENTRY BY LANDLORD
                                               -----------------

         Tenant agrees to permit Landlord or its agents or  representatives  to enter into and upon any part of
the Premises at all  reasonable  hours (and in  emergencies  at all times) to inspect the same,  or to show the
Premises to prospective purchasers,  Mortgagees,  tenants or insurers, to clean or make repairs, alterations or
additions thereto, and Tenant shall not be entitled to any abatement or reduction of rent by reason thereof.

ARTICLE 17
- ------------------
                                           ASSIGNMENT AND SUBLETTING
                                           -------------------------

17.1     Prohibition.  Tenant  shall not assign,  sublease,  transfer or  encumber  this Lease or any  interest
therein,  without  the consent of  Landlord  first  being  obtained,  which  consent  will not be  unreasonably
withheld or delayed  provided  that: (1) Tenant  provides  written notice to Landlord at least 30 days prior to
such assignment or subletting  setting forth the details of the proposed  assignment or sublease;  (2) Landlord
declines to exercise its rights under Section 17.2;  (3) the proposed  transferee (a  "Transferee")  is engaged
in a business  and the  portion of the  Premises  will be used for the use  permitted  under  Article 4 of this
Lease and in a manner  which is in keeping with the then  standards of the Building and does not conflict  with
any  exclusive  use rights  granted to any other tenant of the  Building,  and such use will not, in Landlord's
reasonable  opinion,  materially  increase  parking or  occupancy  loads;  (4) the  Transferee  has  reasonable
financial worth in light of the  responsibilities  involved;  (5) Tenant is not in default at the time it makes
its  request;  (6) the  Transferee  is not a tenant or  currently  negotiating  a lease  with  Landlord  in any
building  owned by Landlord  adjacent to the  Building;  and (7) the rent to be paid by the  Transferee  is not
less than 85% of the rental rate then being  offered by Landlord  for similar  space in the  Building.  Any one
or more (in the  aggregate)  transfers  of more than a twenty  percent  (20%)  interest in the Tenant  shall be
deemed to be an assignment  under this Lease.  Any  attempted  assignment or sublease by Tenant in violation of
the terms and  covenants of this  Article 17 shall be void.  Notwithstanding  anything  contained in this Lease
to the contrary,  Tenant may,  without the prior consent of Landlord,  assign this Lease or sublease all or any
part of the  Premises  to an  affiliate  of  Tenant  or to any  company  into  which  Tenant  may be  merged or
consolidated  or that acquires  substantially  all of the assets of Tenant (an  "Affiliated  Transferee").  Any
such  Affiliated  Transferee  shall have a similar  right to assign  this Lease  without  the prior  consent of
Landlord;  provided,  that in the event of any  assignment  or  sublease to or from an  Affiliated  Transferee,
Tenant  shall remain  liable for the full and timely  performance  of the  obligations  of Tenant  hereunder as
contemplated  by Section 17.4 below.  An "affiliate" of Tenant shall mean any  corporation  which,  directly or
indirectly,  controls,  is controlled by or is under common  control with Tenant or a successor  corporation to
Tenant  by  merger,  consolidation  or  non-bankruptcy  reorganization.  The word  "control"  in this  context,
including in the context of "controlled  by" or "under common  control with," with respect to any  corporation,
partnership or association shall mean the possession,  directly or indirectly,  of the power to direct or cause
the direction of the management and policy of a particular  corporation,  partnership or  association,  whether
through the ownership of voting securities or by contract or otherwise.

17.2     Recapture.  If Tenant  requests  Landlord's  consent to an  assignment  of this Lease or subletting of
all or part of the  Premises,  Landlord  shall  have the  option  (without  limiting  Landlord's  other  rights
hereunder) of terminating  this Lease upon thirty (30) days' notice.  Landlord may then, at Landlord's  option,
lease space to the  prospective  assignee or subtenant.  If Landlord should fail to notify Tenant in writing of
its decision  within a thirty (30) day period after Landlord is notified in writing of the proposed  assignment
or  sublease,  Landlord  shall be  deemed  to have  elected  to keep  this  Lease  in full  force  and  effect.
Notwithstanding  the  foregoing,  not later  than  fifteen  (15) days  after  Tenant's  receipt  of  Landlord's
recapture  notice,  Tenant shall have the right to withdraw  Tenant's  request for  assignment or subletting by
notifying  Landlord in writing of Tenant's  intent to withdraw  such  request,  and this Lease shall  remain in
full force and effect as though Tenant had never submitted such request.

17.3     Reserved.

17.4     Tenant Remains  Liable.  No assignment,  sublease or other  transfer  consented to by Landlord,  shall
release Tenant or change  Tenant's  primary  liability to pay the Rent and to perform all other  obligations of
Tenant under this Lease.  Upon the  occurrence of any default under this Lease,  Landlord may proceed  directly
against  Tenant  without the  necessity of  exhausting  any remedies  against any  subtenant or assignee.  Upon
termination of this Lease, any permitted  subtenant shall, at Landlord's  option,  attorn to Landlord and shall
pay all Rent directly to Landlord.  Landlord's  acceptance  of Rent from any other person shall not  constitute
a waiver of any  provision of this  Article 17.  Consent to one transfer  shall not  constitute  consent to any
subsequent  transfer.  Landlord  may  consent  to  subsequent  assignments  or  modifications  of this Lease by
Tenant's  transferee,  without notifying Tenant or obtaining its consent.  Such action shall not relieve Tenant
of its liability under this Lease.

17.5     No Merger.  No merger  shall  result from  Tenant's  sublease of the  Premises  under this Article 17,
Tenant's  surrender  of this Lease or the  termination  of this Lease in any other  manner.  In any such event,
Landlord may terminate any or all subtenancies or succeed to the interest of Tenant as sublandlord thereunder.

ARTICLE 18
- ------------------
                                                     LIENS
                                                     -----

         Tenant will not permit any  mechanic's  lien(s) or other  liens to be placed upon the  Premises or the
Building  and  nothing in this Lease shall be deemed or  construed  in any way as  constituting  the consent or
request of Landlord,  express or implied,  by inference or otherwise,  to any person for the performance of any
labor or the  furnishing  of any  materials to the  Premises,  or any part  thereof,  nor as giving  Tenant any
right,  power,  or authority to contract for or permit the  rendering of any services or the  furnishing of any
materials  that would give rise to any mechanics' or other liens against the Premises.  If, in connection  with
any work being  performed  by Tenant or any  subtenant,  any  mechanic's  lien or other lien or charge shall be
filed or made against the Premises,  the Building or any  improvements  therein or any part thereof,  or if any
such lien or charge shall be filed or made  against  Landlord,  as owner,  then  Tenant,  at Tenant's  cost and
expense,  shall cause the same to be canceled  and  discharged  of record not later than thirty (30) days after
such lien or charge shall have been filed or made (but in any event prior to foreclosure)  by payment  thereof,
by filing a bond or otherwise,  and shall also defend any action,  suit or proceeding  which may be brought for
the  enforcement  of such lien or charge.  Tenant shall also pay any  damages,  costs and  expenses,  including
reasonable  attorney's  fees,  suffered  or  incurred  by Landlord  in  connection  with such  action,  suit or
proceeding,  and shall  satisfy and  discharge any judgment  entered  therein  within thirty (30) days from the
entering  of such  judgment  by  payment  thereof or filing of a bond or  otherwise,  unless  Tenant  elects to
contest the  judgment,  in which event  Tenant shall (i) within such thirty (30) day period,  provide  Landlord
with a bond in an amount  equal to 125% of the amount of such lien or claim,  (ii)  contest  such lien or claim
in good faith by  appropriate  proceedings,  and (iii) pay promptly any final adverse  judgment  entered in any
such  proceeding.  In the  event  that a lien  is  attached  to the  Premises  and not  removed  by  Tenant  in
accordance  with the foregoing,  then, in addition to any other right or remedy of Landlord,  Landlord may, but
shall not be obligated to,  discharge the same.  Any amount paid by Landlord for any of the aforesaid  purposes
and any expenses  incurred by Landlord in connection  with any such lien shall be paid by Tenant to Landlord on
demand as Additional Rent.

ARTICLE 19
- ------------------
                                                   INSURANCE
                                                   ---------

19.1     Property  Insurance.  Landlord shall maintain  property  coverage  insurance on the Building Shell and
appurtenant  structures in the Common Areas in such amounts as Landlord and any  Mortgagees  may deem necessary
or appropriate,  but in no event less than the full replacement  cost of the Building.  Such insurance shall be
maintained  at the expense of Landlord (as a part of Operating  Expenses),  and payments for losses  thereunder
shall be made solely to Landlord or the Mortgagees as their  respective  interests  shall appear.  Tenant shall
obtain and keep in force at all times during the Lease Term, a policy or policies of  insurance  covering  loss
or damage to all of the  improvements,  betterments,  income and business  contents located within the Premises
other than the Building Shell  (including all improvements  constructed  pursuant to Exhibit "D") in the amount
of the full replacement value thereof as ascertained by the Tenant's insurance  carrier,  as the same may exist
from time to time,  against all perils normally covered in an "all risk" policy  (including the perils of flood
and surface waters), as such term is used in the insurance industry.

19.2     Liability  Insurance.  Tenant shall,  at Tenant's  expense,  maintain a policy of  Commercial  General
Liability  insurance  insuring  Landlord  and Tenant  against  liability  arising  out of the  ownership,  use,
occupancy  or  maintenance  of  the  Premises.  Such  insurance  shall  be on  an  occurrence  basis  providing
single-limit  coverage  in an  amount  not less than One  Million  Dollars  ($1,000,000)  per  occurrence.  The
initial  amount of such  insurance  shall be subject to periodic  increase upon  reasonable  demand by Landlord
based upon inflation,  increased  liability awards,  recommendation  of professional  insurance  advisers,  and
other relevant factors.  However,  the limits of such insurance shall not limit Tenant's  liability nor relieve
Tenant of any  obligation  hereunder.  Landlord  shall be named as an  additional  insured on said policies and
the  policies  shall  contain  the  following  provision:  "Such  insurance  as afforded by this policy for the
benefit of Landlord shall be primary as respects any claims,  losses or  liabilities  arising out of the use of
Premises by the Tenant or by  Tenant's  operation  and any  insurance  carried by Landlord  shall be excess and
non-contributing."  The policy shall insure  Tenant's  performance  of the indemnity  provisions of Articles 14
and 20.

19.3     Requirements  for Insurance  Policies.  Insurance  required to be maintained by Tenant hereunder shall
be in companies  holding a "General  Policyholders'  Rating" of A or better and a  "financial  rating" of 10 or
better,  as set forth in the most current issue of "Best's  Insurance  Guide." Tenant shall promptly deliver to
Landlord,  within thirty (30) days of the Commencement  Date,  original  certificates  evidencing the existence
and amounts of such  insurance.  No such policy shall be  cancelable  or subject to reduction of coverage  with
respect to the Premises  except after thirty (30) days prior written notice to Landlord.  Tenant shall,  within
fifteen (15) days prior to the expiration,  cancellation or reduction of such policies,  furnish  Landlord with
renewals or "binders"  thereof.  Tenant shall not do or permit to be done anything  which shall  invalidate the
insurance policies required under this Lease.

19.4     Waiver of  Subrogation  Rights.  Tenant and  Landlord  shall  obtain from the issuer of the  insurance
policies  referred  to in  Section  19.1 a waiver of  subrogation  provision  in said  policies  and Tenant and
Landlord  hereby  release,  relieve and waive any and all rights of  recovery  against  Landlord or Tenant,  or
against the employees,  officers,  agents and representatives of Landlord or Tenant, for loss or damage arising
out of or incident to the perils  insured  against  under  Section  19.1 which perils occur in, on or about the
Premises or the  Building,  whether due to the  negligence  of Landlord or Tenant or their  agents,  employees,
contractors or invitees.  The extent of the waiver described in the immediately  preceding  sentence is limited
to the extent of insurance carried by Landlord and Tenant pursuant to Section 19.1 of this Lease.

ARTICLE 20
- ------------------
                                                   INDEMNITY
                                                   ---------

         20.1     Indemnity  by Tenant.  Tenant  shall  indemnify  and hold  harmless  Landlord and all agents,
servants  and  employees  of  Landlord  from and against all claims,  losses,  damages,  liabilities,  expenses
(including  reasonable  attorney  fees),  penalties and charges arising from or in connection with (i) Tenant's
use of the Premises  during the Lease Term,  or (ii) the conduct of Tenant's  business,  or (iii) any activity,
work or things done,  permitted or suffered by Tenant in or about the  Premises  during the Lease Term.  Tenant
shall  further  indemnify  and hold  harmless  Landlord  from and  against any and all  claims,  loss,  damage,
liability,  expense  (including  reasonable  attorney fees),  penalty or charge arising from any default in the
performance of any obligation on Tenant's part to be performed  under the terms of this Lease,  or arising from
any  negligence of Tenant,  or any of Tenant's  agents,  contractors,  or  employees,  and from and against all
costs,  attorney  fees,  expenses  and  liabilities  incurred in the defense of any such claim or any action or
proceeding  brought  thereon.  If any action or  proceeding be brought  against  Landlord by reason of any such
claim,  Tenant,  upon  notice  from  Landlord,  shall  defend the same at  Tenant's  expense  by legal  counsel
reasonably  satisfactory  to Landlord.  Tenant,  as a material part of its  consideration  to Landlord,  hereby
assumes  all risk of damage to  property or injury to persons in or upon the  Premises  arising  from any cause
and Tenant  hereby  waives all claims in respect  thereof  against  Landlord.  Notwithstanding  the  foregoing,
Tenant shall not be required to defend,  save  harmless or indemnify  Landlord  from any  liability for injury,
loss,  accident or damage to any person or property  resulting  from  Landlord's  negligence or willful acts or
omissions,  or those of  Landlord's  officers,  agents,  contractors  or employees.  Tenant's  indemnity is not
intended  to nor shall it relieve  any  insurance  carrier of its  obligations  under  policies  required to be
carried by Tenant  pursuant to the  provisions of this Lease to the extent that such policies cover the results
of negligent acts or omissions of Landlord, its officers,  agents,  contractors or employees, or the failure of
Landlord to perform any of its obligations under this Lease.

         20.2     Indemnity by Landlord.  Landlord  shall  indemnify and hold  harmless  Tenant and all agents,
servants  and  employees  of Tenant  from and  against  all  claims,  losses,  damages,  liabilities,  expenses
(including  reasonable  attorney fees),  penalties and charges arising from or in connection with any damage to
any person or property  resulting  solely from the gross  negligence  or  intentional  acts of Landlord or from
Landlord's failure to comply with any governmental laws,  ordinances or regulations  applicable to the Building
(but excluding the Premises)  which Landlord is required to comply with under this Lease,  and from and against
all costs,  reasonable  attorney fees,  expenses and  liabilities  incurred in the defense of any such claim or
any action or proceeding  brought  thereon.  If any action or proceeding be brought against Tenant by reason of
any such claim,  Landlord,  upon notice  from  Tenant,  shall  defend the same at  Landlord's  expense by legal
counsel reasonably  satisfactory to Tenant.  Notwithstanding  the foregoing,  Landlord shall not be required to
defend,  save  harmless or indemnify  Tenant from any  liability  for injury,  loss,  accident or damage to any
person or property  resulting  from  Tenant's  negligence  or willful acts or  omissions,  or those of Tenant's
officers, agents, contractors or employees.

ARTICLE 21
- ------------------
                                       DAMAGE OR DESTRUCTION TO BUILDING
                                       ---------------------------------

21.1     Partial  Destruction.  In the event that the  Premises  or the  Building  are damaged by fire or other
insured casualty and the insurance  proceeds have been made available  therefor by the holder or holders of any
mortgages  or deeds of trust  covering  the  Building,  the damage  shall be  repaired by and at the expense of
Landlord to the extent of such insurance  proceeds  available  therefor,  provided such repairs and restoration
can, in Landlord's  reasonable  opinion,  be made within one hundred  eighty (180) days after the occurrence of
such damage  without the payment of overtime or other  premiums,  and until such  repairs and  restoration  are
completed,  the Base Rent  shall be abated in  proportion  to the part of the  Premises  which is  unusable  by
Tenant in the conduct of its  business,  as may be  reasonably  determined  by Landlord  (but there shall be no
abatement of Base Rent by reason of any portion of the Premises  being  unusable for a period equal to five (5)
business  days or less).  Landlord  agrees to notify  Tenant  within sixty (60) days after such  casualty if it
estimates  that it will be unable to repair and restore the Premises  within said one hundred  eighty (180) day
period.  Such notice shall set forth the  approximate  length of time  Landlord  estimates  will be required to
complete  such  repairs  and  restoration.  Notwithstanding  anything  to the  contrary  contained  herein,  if
Landlord cannot or estimates it cannot make such repairs and  restoration  within said one hundred eighty (180)
day period,  then Tenant may, by written notice to Landlord,  cancel this Lease,  provided such notice is given
to Landlord  within  fifteen (15) days after Landlord  notifies  Tenant of the estimated time for completion of
such repairs and  restoration.  Notwithstanding  the  preceding  sentence,  Tenant may not cancel this Lease as
hereinabove  stated if the  damage to the  Premises  or the  Building  is in whole or in part the result of the
act, omission,  fault, or negligence of Tenant, its agents,  contractors,  employees,  licensees,  or invitees.
Except as provided in this  Article 21,  there shall be no  abatement  of rent and no  liability of Landlord by
reason of any injury to or  interference  with  Tenant's  business or property  arising  from the making of any
such repairs,  alterations, or improvements in or to the Building,  Premises, or fixtures,  appurtenances,  and
equipment.  Tenant  understands  that  Landlord  will not carry  insurance  of any kind on  Tenant's  property,
including  furniture and furnishings,  or on any fixtures or equipment removable by Tenant under the provisions
of this Lease,  or any  improvement  installed  in the  Premises by or on behalf of Tenant,  and that  Landlord
shall not be obligated to repair any damage thereto or replace the same.

21.2     Total  Destruction.  In case the Building  throughout shall be so injured or damaged,  whether by fire
or  otherwise  (though the  Premises  may not be  affected,  or if  affected,  can be repaired  within said one
hundred  eighty (180) day period)  that  Landlord,  within sixty (60) days after the  happening of such injury,
shall decide not to reconstruct or rebuild the Building,  then  notwithstanding  anything  contained  herein to
the  contrary,  upon notice in writing to that effect given by Landlord to Tenant  within said sixty (60) days,
Tenant shall pay the rent,  properly  apportioned up to date of such casualty,  this Lease shall terminate from
the date of delivery of said written  notice,  and both parties  hereto shall be released and  discharged  from
all further  obligations  hereunder (except those obligations which expressly survive  termination of the Lease
term).  A total destruction of the Building shall automatically terminate this Lease.

ARTICLE 22
- ------------------
                                                 CONDEMNATION
                                                 ------------

         If the  whole or  substantially  the  whole of the  Building  or the  Premises  shall be taken for any
public or quasi-public  use, by right of eminent domain or otherwise or shall be sold in lieu of  condemnation,
then this Lease shall  terminate  as of the date when  physical  possession  of the Building or the Premises is
taken by the condemning  authority.  If less than the whole or  substantially  the whole of the Building or the
Premises is thus taken or sold,  Landlord  (whether or not the Premises are affected thereby) or Tenant (if the
Premises are  materially  affected  thereby) may terminate  this Lease by giving  written notice thereof to the
other  party,  in which  event this Lease  shall  terminate  as of the date when  physical  possession  of such
portion of the Building or Premises is taken by the  condemning  authority.  If the Lease is not so  terminated
upon any such taking or sale, the Base Rent payable hereunder shall be diminished by an equitable  amount,  and
Landlord shall, to the extent Landlord deems feasible,  restore the Building and the Premises to  substantially
their  former  condition,  but such work shall not exceed the scope of the work done by Landlord in  originally
constructing the Building and installing  Building  Standard  Improvements in the Premises,  nor shall Landlord
in any event be  required  to spend for such work an amount in excess of the amount  received  by  Landlord  as
compensation  for such  taking.  All amounts  awarded  upon a taking of any part or all of the  Building or the
Premises shall belong to Landlord,  and Tenant shall not be entitled to and expressly  waives all claims to any
such  compensation.  Notwithstanding  anything  contained  herein Tenant may bring separate  action against the
condemning  authority to recover  relocation and business  interruption  expenses  incurred,  and for the value
personal property,  fixtures and other  improvements lost, by Tenant as a result of the condemning  authority's
actions.

ARTICLE 23
- ------------------
                                          DAMAGES FROM CERTAIN CAUSES
                                          ---------------------------

         Landlord  shall not be liable to Tenant for any loss or damage to any  property  or person  occasioned
by theft, fire, earthquake, any other act of God, public enemy, injunction,  riot, strike,  insurrection,  war,
court order,  requisition,  or order of governmental body or authority or by any other cause beyond the control
of  Landlord.  In  addition,  Landlord  shall not be liable  for any  damage or  inconvenience  which may arise
through repair or alteration of any part of the Building or Premises.

ARTICLE 24
- ------------------
                                               EVENTS OF DEFAULT
                                               -----------------

         The following events (each an "Event of Default") shall constitute a default by Tenant hereunder:

a.       If Tenant  shall fail to pay when due any  installment  of Base Rent,  Additional  Rent,  or any other
amounts payable hereunder within five (5) days after the due date therefor;

b.       If this Lease or the estate of Tenant  hereunder  shall be  transferred to or shall pass to or devolve
upon any other person or party in violation of the provisions of this Lease, except as permitted herein;

c.       If this Lease or the Premises or any part thereof  shall be taken upon  execution or by other  process
of law directed  against  Tenant,  or shall be taken upon or subject to any  attachment  at the instance of any
creditor  or  claimant  against  Tenant,  and said  attachment  shall not be  discharged  or disposed of within
fifteen (15) days after the levy thereof;

d.       If Tenant shall file a petition in  bankruptcy  or insolvency  or for  reorganization  or  arrangement
under the bankruptcy laws of the United States or under any insolvency act of any state,  or shall  voluntarily
take  advantage  of any  such law or act by  answer  or  otherwise,  or shall  be  dissolved  or shall  make an
assignment for the benefit of creditors;

e.       If involuntary  proceedings  under any such bankruptcy law or insolvency act or for the dissolution of
Tenant  shall  be  instituted  against  Tenant,  or a  receiver  or  trustee  shall  be  appointed  of  all  or
substantially  all of the property of Tenant,  and such proceedings shall not be dismissed or such receivership
or trusteeship vacated within ninety (90) days after such institution or appointment;

f.       If Tenant shall fail to take  possession of the Premises  within thirty (30) days of the  Commencement
Date;

g.       If Tenant shall abandon the Premises;

h.       If Tenant shall fail to perform any of the other agreements,  terms,  covenants,  or conditions hereof
on  Tenant's  part to be  performed  (other  than the  obligation  to pay  Rent or any  other  charges  payable
hereunder),  and such  nonperformance  shall continue for a period of fifteen (15) days after notice thereof by
Landlord to Tenant;  provided,  however,  that if Tenant  cannot  reasonably  cure such  nonperformance  within
fifteen  (15) days,  Tenant  shall not be in default if it  commences  cure within said  fifteen  (15) days and
diligently pursues the same to completion;

i.       If Tenant shall fail to obtain a release of any mechanic's lien, as required herein;

j.       If a  guarantor  of this  Lease,  if any,  or a general  partner  of Tenant (if Tenant is a general or
limited partnership),  becomes a debtor under any state or federal bankruptcy  proceedings,  or becomes subject
to  receivership  or  trusteeship  proceedings,  whether  voluntary  or  involuntary;  except  in the case of a
guarantor,  Tenant shall not be in default if a  substitute  guarantor,  with  creditworthiness  and  financial
abilities  acceptable  to  Landlord  in  light of the  responsibilities  of  Tenant  hereunder,  and  otherwise
acceptable to Landlord, is provided to Landlord within fifteen (15) days;

k.       If fifty  percent  (50%) or more of the  personal  property  of Tenant is  seized,  subject to levy or
attachment, or similarly repossessed or removed from the Premises; or

l.       Tenant  shall fail to deliver an  Estoppel  Certificate  or  Subordination  Agreement  within the time
periods set forth in this Lease.


ARTICLE 25
- ------------------
                                              LANDLORD'S REMEDIES
                                              -------------------

25.1     Landlord's  Remedies.  Upon the occurrence of any Event of Default,  Landlord shall have the right, at
its election, then or at any time thereafter either:

(i)      to give  Tenant  written  notice of  Landlord's  intention  to  terminate  this Lease on the date such
notice is given or on any later date  specified  therein,  whereupon,  on the date  specified  in such  notice,
Tenant's  right to  possession  of the  Premises  shall cease and this Lease  shall  thereupon  be  terminated;
provided,  however, that all of Tenant's obligations,  including,  but not limited to, payment of the amount of
Rent and other  obligations  reserved in this Lease for the balance of the term hereof,  shall  immediately  be
accelerated and due and payable (subject to Landlord's  obligation  pursuant to Section 25.10 below to mitigate
its damages); or

(ii)     to re-enter  and take  possession  of the  Premises  or any part  thereof  and  repossess  the same as
Landlord's  former estate and expel Tenant and those claiming  through or under Tenant,  and remove the effects
of both or either,  using such force for such  purposes as may be  reasonably  necessary,  without being liable
for prosecution  thereof,  without being deemed guilty of any manner of trespass,  and without prejudice to any
remedies  for arrears of rent or  preceding  breach of  covenants or  conditions,  all in  accordance  with and
subject to  applicable  Laws.  Should  Landlord  elect to re-enter the Premises as provided in this  Paragraph,
Landlord  shall  provide  Tenant 3 days prior  notice as required by Colorado  Law.  Should  Landlord  elect to
re-enter the Premises as provided in this Paragraph  25.1(ii) or should  Landlord take  possession  pursuant to
legal  proceedings  or pursuant to any notice  provided for by law,  Landlord may,  from time to time,  without
terminating  this Lease,  relet the Premises or any part thereof in  Landlord's or Tenant's  name,  but for the
account of Tenant,  for such term or terms (which may be greater or less than the period which would  otherwise
have  constituted  the  balance of the term of this  Lease) and on such  conditions  and upon such other  terms
(which may include  concessions  of free rent and  alteration  and repair of the Premises) as Landlord,  in its
reasonable  discretion,  may  determine,  and  Landlord  may collect and receive the rents  therefor.  Landlord
shall in no way be  responsible  or liable for any failure to relet the Premises or any part thereof or for any
failure to collect any rent due upon such  reletting.  No such  re-entry or taking  possession  of the Premises
by Landlord  shall be construed  as an election on  Landlord's  part to  terminate  this Lease unless a written
notice of such  intention be given to Tenant.  No notice from Landlord  hereunder or under a forcible entry and
detainer  statute or similar law shall  constitute an election by Landlord to terminate  this Lease unless such
notice  specifically so states.  Landlord reserves the right following any such re-entry and/or  reletting,  to
exercise its right to terminate  this Lease by giving Tenant such written  notice,  in which event,  this Lease
will terminate as specified in said notice.

25.2     Effects of Landlord's  Election to Take  Possession  of Premises.  In the event that Landlord does not
elect to terminate  this Lease as permitted in Section  25.1(i)  hereof,  but on the  contrary,  elects to take
possession  as  provided  in Section  25.1(ii),  Tenant  shall pay to  Landlord  (i) the Rent and other sums as
herein provided,  which would be payable  hereunder if such  repossession  had not occurred,  less (ii) the net
proceeds,  if any, of any reletting of the Premises after deducting all Landlord's  expenses in connection with
such reletting,  including, without limitation, all repossession costs, brokerage commissions,  legal expenses,
attorney's  fees,  expenses of employees,  alteration and repair costs,  and expenses of  preparation  for such
reletting.  If, in connection  with any  reletting,  the new lease term extends beyond the existing Lease Term,
or the premises  covered thereby include other premises not part of the Premises,  a fair  apportionment of the
rent received  from such  reletting and the expenses  incurred in  connection  therewith as provided  aforesaid
will be made in  determining  the net proceeds from such  reletting.  Tenant shall pay such rent and other sums
to Landlord  monthly on the days on which the Rent would have been  payable  hereunder  if  possession  had not
been taken.

25.3     Effect of  Landlord's  Election  to  Terminate  the  Lease.  In the event  this  Lease is  terminated,
Landlord shall be entitled to recover  forthwith  against Tenant, as damages for loss of the bargain and not as
a penalty,  an aggregate sum which, at the time of such  termination of this Lease,  represents the excess,  if
any, of the  aggregate of the Rent and all other sums payable by Tenant  hereunder  that would have accrued for
the  balance of the Lease  Term over the  aggregate  rental  value of the  Premises  (such  rental  value to be
computed  on the  basis of a  tenant  paying  not only a rent to  Landlord  for the use and  occupation  of the
Premises,  but also such other  charges as are required to be paid by Tenant under the terms of this Lease) for
the  balance  of such Lease  Term,  both  discounted  to present  worth at the rate of eight  percent  (8%) per
annum.  Alternatively,  at Landlord's  option,  Tenant shall remain liable to Landlord for damages in an amount
equal to the rent and other sums  arising  under the Lease for the  balance of the Lease Term had the Lease not
been terminated,  less the net proceeds,  if any, from any subsequent  reletting,  after deducting all expenses
associated  therewith  and as  enumerated  above.  Landlord  shall be entitled to receipt of such  amounts from
Tenant  monthly on the days on which such sums would have otherwise been payable.  Landlord's  rights  pursuant
to the  foregoing  provisions  shall be subject to  Landlord's  obligation  pursuant to Section  25.10 below to
mitigate its damages.

25.4     Suits for  Recovery by  Landlord.  Suit or suits for the recovery of the amounts and damages set forth
above may be brought by  Landlord,  from time to time,  at  Landlord's  election,  and nothing  herein shall be
deemed to require  Landlord  to await the date  whereon  this Lease or the Lease  Term would have  expired  had
there been no such default by Tenant or no such termination, as the case may be.

25.5     Rents,  Issues,  and Profits  from  Subleases.  After an Event of Default by Tenant,  Landlord may sue
for or  otherwise  collect  all Rents,  issues,  and  profits  payable  under all  subleases  on the  Premises,
including those past due and unpaid.

25.6     Landlord's  Entry  Upon the  Premises  and  Other  Remedies.  After an Event  of  Default  by  Tenant,
Landlord may, without  terminating this Lease,  enter upon the Premises without being liable for prosecution of
any claim for damages,  without  being deemed  guilty of any manner of trespass,  and without  prejudice to any
other  remedies,  and do whatever  Tenant is  obligated to do under the terms of this Lease.  Tenant  agrees to
reimburse  Landlord on demand for any  expenses  which  Landlord  may incur in  effecting  compliance  with the
Tenant's  obligations  under this  Lease.  Further,  Tenant  agrees that  Landlord  shall not be liable for any
damages  resulting to Tenant from  effecting  compliance  with  Tenant's  obligations  under this  subparagraph
unless caused by the gross negligence or willful misconduct of Landlord.

25.7     No Waivers  Unless  Express.  No failure by  Landlord  to insist  upon the strict  performance  of any
agreement,  term,  covenant,  or condition  hereof or to exercise any right or remedy  consequent upon a breach
thereof,  and no  acceptance  of full or  partial  rent  during  the  continuance  of any  such  breach,  shall
constitute a waiver of any such breach of such agreement,  term, covenant,  or condition.  No agreement,  term,
covenant,  or condition  hereof to be performed or complied  with by Tenant,  and no breach  thereof,  shall be
waived,  altered,  or  modified  except by written  instrument  executed by  Landlord.  No waiver of any breach
shall affect or alter this Lease,  but each and every  agreement,  term,  covenant,  and condition hereof shall
continue  in full force and effect  with  respect to any other then  existing  or  subsequent  breach  thereof.
Notwithstanding  any unilateral  termination of this Lease,  this Lease shall continue in full force and effect
as to any provisions  hereof which, by the express terms contained  herein,  require  observance or performance
of Landlord or Tenant subsequent to termination.

25.8     Lease Not a Limitation  of Remedies.  Nothing  contained in this Section  shall limit or prejudice the
right of  Landlord  to prove and obtain as  liquidated  damages in any  bankruptcy,  insolvency,  receivership,
reorganization,  or dissolution  proceeding,  an amount equal to the maximum  allowed by any statute or rule of
law  governing  such  proceeding  and in effect at the time when such damages are to be proved,  whether or not
such amount be greater,  equal to, or less than the amounts  recoverable,  either as damages or Rent,  referred
to in any of the provisions of this Section.

25.9     Default Interest Rate,  Administrative  Charge, and Other Matters.  Any Rent or other amounts owing to
Landlord  hereunder  which are not paid within five (5) days of the date they are due,  shall  thereafter  bear
interest from the due date at the rate of eighteen  percent  (18%) per annum  ("Default  Interest  Rate") until
paid.  Similarly,  any amounts paid by Landlord to cure any default of Tenant or to perform any  obligation  of
Tenant,  shall,  if not  repaid by the  Tenant  within  five (5) days of demand by  Landlord,  thereafter  bear
interest  from the date  paid by  Landlord  at the  Default  Interest  Rate  until  paid.  In  addition  to the
foregoing,  Tenant  shall pay to  Landlord  whenever  any Base  Rent,  Additional  Rent,  or any other sums due
hereunder  remain  unpaid  more than five (5) days  after the due date  thereof,  an  administrative  charge to
compensate  Landlord for the costs and expenses  associated  with  handling a delinquent  account equal to five
percent (5%) of the amount due.  Further,  upon an Event of Default by Tenant,  in addition to all other rights
and remedies,  Landlord  shall be entitled to receive from Tenant all sums, the payment of which may previously
have been waived or abated by Landlord,  or which may have been paid by Landlord  pursuant to any  agreement to
grant Tenant a rental  abatement or other  monetary  inducement or concession,  including,  but not limited to,
any tenant finish  allowance,  together with interest  thereon from the date or dates such amounts were paid by
Landlord or would have been due from Tenant but for the abatement,  at the Default  Interest Rate,  until paid;
it being  understood  and agreed that such  concession  or abatement  was made on the  condition and basis that
Tenant  fully  perform  all  obligations  and  covenants  under  the  Lease  for the  entire  term.  Landlord's
acceptance  of any late charge or interest  shall not  constitute a waiver of Tenant's  default with respect to
the overdue  amount nor prevent  Landlord  from  exercising  any of the other rights and remedies  available to
Landlord under this Lease or any law now or hereafter in effect.

25.10    Remedies  Cumulative,  Costs of Collection;  Waiver of Jury Trial.  Each right and remedy provided for
in this Lease shall be  cumulative  and shall be in addition  to every  other right or remedy  provided  for in
this  Lease nor or  hereafter  existing  at law or in equity or by  statute or  otherwise,  including,  but not
limited  to,  suits  for  injunctive  or  declaratory  relief  and  specific   performance.   The  exercise  or
commencement  of the  exercise by Landlord  of any one or more of the rights or remedies  provided  for in this
Lease  now or  hereafter  existing  at law or in equity or by  statute  or  otherwise  shall not  preclude  the
simultaneous  or  subsequent  exercise by Landlord of any or all other rights or remedies  provided for in this
Lease,  or now or hereafter  existing at law or in equity or by statute or  otherwise.  Without  limitation  of
the foregoing,  Landlord  agrees to use  commercially  reasonable  efforts to mitigate its damages arising as a
result of a default by Tenant under this Lease.  All costs incurred by Landlord in connection  with  collecting
any  amounts  and  damages  owing by Tenant  pursuant  to the  provisions  of this Lease or by either  party to
enforce any provision of this Lease,  including,  by way of example, but not limitation,  reasonable attorneys'
fees from the date any such matter is turned over to an attorney,  shall also be  recoverable by the prevailing
party in any such  enforcement  action.  Landlord  from  Tenant.  Landlord  and Tenant agree that any action or
proceeding  arising out of this Lease shall be heard by a court  sitting  without a jury and thus hereby  waive
all rights to a trial by jury.

ARTICLE 26
- ------------------
                                              LANDLORD'S DEFAULT
                                              ------------------

         Landlord  shall be in  default  hereunder  in the  event  Landlord  has not  begun  and  pursued  with
reasonable  diligence the cure of any failure of Landlord to meet its obligations  hereunder within thirty (30)
days' of receipt by Landlord of written  notice  from  Tenant of the  alleged  failure to perform.  Such notice
shall be ineffective  unless a copy is  simultaneously  also delivered in the manner  required in this Lease to
any  Mortgagee,  provided that prior to such notice Tenant has been notified (by way of notice of Assignment of
Rents and  Leases,  or  otherwise),  of the address of a  Mortgagee.  If  Landlord  fails to cure such  default
within the time  provided,  then  Mortgagee  shall have an  additional  30 days  following a second notice from
Tenant  or, if such  default  cannot be cured  within  that  time,  such  additional  time as may be  necessary
provided within such 30 days,  Mortgagee  commences and diligently  pursues a cure  (including  commencement of
foreclosure  proceedings  if necessary to effect such cure).  Tenant's sole remedy will be equitable  relief or
actual damages as described below, but in no event is Landlord or any Mortgagee  responsible for  consequential
damages or lost  profit  incurred by Tenant as a result of any default by  Landlord.  In no event shall  Tenant
have the right to  terminate  or rescind  this Lease as a result of  Landlord's  default as to any  covenant or
agreement  contained in this Lease or as a result of the breach of any promise or  inducement  hereof,  whether
in the Lease or  elsewhere.  If  Landlord  fails to (i)  discharge  fully any of its  obligations  imposed by a
mortgage that is superior to this Lease,  or (ii) pay an Real Property Taxes  affecting the Premises,  or (iii)
make any  repairs  required  under  this  Lease or under  applicable  Laws,  then  Tenant  may (but will not be
required to),  after written  notice to Landlord of its intent to do so,  discharge  such  obligations,  as the
case may be. If  Tenant  elects  to  discharge  such  obligations,  Landlord  shall  reimburse  Tenant  for all
out-of-pocket,  third party costs incurred by Tenant to satisfy such obligations  within thirty (30) days after
Landlord's  receipt of an itemized  invoice  therefore.  In the event Landlord does not timely reimburse Tenant
for such costs,  Tenant  shall not have any right to offset  Rent  unless and until it has  received a judgment
from a court of  competent  jurisdiction  which  determines  that  Landlord was  obligated  to  discharge  such
obligations,  pay such Real Property Taxes or make such repairs and Landlord does not,  within thirty (30) days
after the issuance of the court's  order,  either (1) post the required  bond for appeal,  or (2) pay the total
damages  awarded by the court (or otherwise  remedy the default,  as  applicable);  provided,  that if Landlord
fails to take  either  such  action,  Tenant  shall have the right to an  abatement  of Rent only to the extent
necessary  to  satisfy  such  judgment.  Tenant  hereby  covenants  that,  prior  to the  exercise  of any such
remedies, it will give any Mortgagee notice and a reasonable time to cure any default by Landlord.

ARTICLE 27
- ------------------
                                              PEACEFUL ENJOYMENT
                                              ------------------

         Tenant shall,  and may  peacefully  have,  hold,  and enjoy the  Premises,  subject to the other terms
hereof,  provided  that Tenant pays the Rent and other sums  herein  recited to be paid by Tenant and  performs
all of Tenant's  covenants and agreements  herein  contained.  This covenant and any and all other covenants of
Landlord shall be binding upon Landlord and its successors only with respect to breaches  occurring  during its
or their respective periods of ownership of Landlord's interest hereunder.

ARTICLE 28
- ------------------
                                                 HOLDING OVER
                                                 ------------

         In the event of holding over by Tenant after the  expiration or other  termination of this Lease or in
the event  Tenant  continues to occupy the  Premises  after the  termination  of Tenant's  right of  possession
pursuant to Article 25 above,  Tenant  shall,  throughout  the entire  holdover  period,  pay rent equal to one
hundred fifty percent  (150%) the Base Rent and Additional  Rent which would have been  applicable had the term
of this Lease  continued  through the period of such holding over by Tenant.  If Tenant  remains in  possession
of all or any part of the Premises after the  expiration of the Lease Term,  with the express  written  consent
of Landlord:  (i) such tenancy will be deemed to be a periodic  tenancy  from  month-to-month  only;  (ii) such
tenancy will not  constitute a renewal or extension of this Lease for any further term;  and (iii) such tenancy
may be terminated  by Landlord upon the earlier of thirty (30) days' prior written  notice or the earliest date
permitted by law.  Such  month-to-month  tenancy will be subject to every other term,  condition,  and covenant
contained in this Lease  including the Base Rent and  Additional  Rent  provisions.  Nothing  contained in this
Article 28 shall be  construed  as consent by  Landlord  to any holding  over of the  Premises  by Tenant,  and
Landlord  expressly  reserves the right to require  Tenant to surrender  possession of the Premises to Landlord
upon the expiration or earlier  termination  of this Lease.  If Tenant fails to surrender the Premises upon the
expiration or earlier  termination  of this Lease despite demand to do so by Landlord,  Tenant shall  indemnify
and hold Landlord harmless from all loss or liability,  including,  without  limitation,  any claim made by any
succeeding tenant founded on or resulting from such failure to surrender.

ARTICLE 29
- ------------------
                                           SUBORDINATION TO MORTGAGE
                                           -------------------------

         Tenant  accepts  this Lease  subject  and  subordinate  to any  mortgage,  deed of trust or other lien
presently  existing or hereafter arising upon the Premises,  upon the Building as a whole, and to any renewals,
refinancing  and  extensions  thereof,  but Tenant agrees that any such  Mortgagee  shall have the right at any
time to  subordinate  such  mortgage,  deed of trust or other lien to this  Lease on such terms and  subject to
such  conditions as such Mortgagee may deem  appropriate in its  discretion.  Tenant agrees within fifteen (15)
days  after  request  therefore  to  execute  a  subordination  and  non-disturbance  agreement  in the form of
agreement  attached hereto as Exhibit I or such similar  agreement as Landlord may reasonably  request.  In the
                              ---------
event that any mortgage or deed of trust is foreclosed or  conveyance  in lieu of  foreclosure  is made for any
reason,   Tenant   shall,   if  requested  by  the   Mortgagee,   attorn  to  and  become  the  Tenant  of  the
successor-in-interest  to  Landlord  and in such event  Tenant  hereby  waives its right  under any  current or
future law which gives or purports to give Tenant any right to  terminate or  otherwise  adversely  affect this
Lease and the  obligations  of Tenant  hereunder.  If in connection  with  obtaining  construction,  interim or
permanent  financing for the Building,  the lender shall request  modifications to this Lease as a condition to
such financing,  Tenant will not withhold or delay its consent  thereto,  provided that such  modifications  do
not increase the  obligations of Tenant  hereunder and do not otherwise  materially  adversely  affect Tenant's
rights  hereunder.  Tenant's  failure to timely  comply with the  foregoing  requirements  shall  constitute  a
default  under this Lease for which  Tenant  shall not be entitled to any cure  period,  and in addition to all
other  remedies to which  Landlord may be entitled  under this Lease with respect to a Tenant  default,  Tenant
shall be liable to Landlord for all damages,  consequential  or otherwise,  incurred by Landlord as a result of
such default.  Notwithstanding  the foregoing,  any subordination by Tenant shall be made only on the condition
that the  Mortgagee  agrees in writing  that  Tenant's  rights  under this Lease shall not be disturbed by such
Mortgagee  as long has Tenant has paid all Rent and other sums then due and payable by Tenant and is  otherwise
not in default under this Lease beyond any applicable cure period.

ARTICLE 30
- ------------------
                                                   Reserved

ARTICLE 31
- ------------------
                                           BANKRUPTCY OR INSOLVENCY
                                           ------------------------

31.1     Deemed  Rejection  of Lease.  Subject to the  provisions  of  Section 24 (d) and (e) above,  if Tenant
becomes a debtor under  Chapter 7 of the United  States  Bankruptcy  Code (the  "Bankruptcy  Code"),  or in the
event that a petition for  reorganization  or adjustment of debts is filed  concerning the Tenant under Chapter
11 or Chapter 13 of the  Bankruptcy  Code, or a proceeding  filed under Chapter 7 is  transferred to Chapter 11
or 13, the  "Trustee" or the Tenant,  as  "Debtor-in-Possession,"  shall be deemed to have rejected this Lease.
No election by the Trustee or  Debtor-in-Possession  to assume this Lease shall be effective unless each of the
following  conditions,  which  Landlord and Tenant  hereby  acknowledge  to be  commercially  reasonable in the
context of a bankruptcy  proceeding,  has been satisfied,  and the Landlord has so acknowledged in writing: (i)
the  Trustee or  Debtor-in-Possession  has  cured,  or has  provided  the  Landlord  "adequate  assurance"  (as
hereinafter  defined) that from the date of such assumption the Trustee or  Debtor-In-Possession  will promptly
cure, all monetary and  non-monetary  defaults under the Lease;  (ii) the Trustee or  Debtor-in-Possession  has
compensated,  or has  provided  to the  Landlord  adequate  assurance  that within ten (10) days of the date of
assumption  the Landlord  will be  compensated,  for any pecuniary  loss incurred by the Landlord  arising from
default  of the  Tenant,  the  Trustee,  or the  Debtor-in-Possession  as  recited  in the  Landlord's  written
statement  of  pecuniary  loss  sent  to  the  Trustee  or  Debtor-in-Possession;  and  (iii)  the  Trustee  or
Debtor-in-Possession  has provided the Landlord with adequate  assurance of future  performance  of each of the
Tenant's,  the  Trustee's,  or the  Debtor-in-Possession's  obligations  under this Lease;  provided,  however,
that:  (x) the Trustee or  Debtor-in-Possession  shall also  deposit  with the  Landlord,  as security  for the
timely  payment  of rent  and  other  sums due  hereunder,  an  amount  equal to four  (4)  months  Base  Rent,
Additional Rent, and other monetary  charges  accruing under this Lease;  and (y) the obligations  imposed upon
the Trustee or  Debtor-in-Possession  shall  continue  with respect to the Tenant or any assignee of this Lease
after the completion of the bankruptcy proceedings.

31.2     Adequate  Assurance.  For purposes of this  Section,  Landlord  and Tenant  acknowledge  that,  in the
context of the bankruptcy  proceedings of the Tenant,  at a minimum,  "adequate  assurance" shall mean: (i) the
Trustee or  Debtor-in-Possession  will continue to have sufficient unencumbered assets after the payment of all
secured   obligations   and   administrative   expenses   to  assure   the   Landlord   that  the   Trustee  or
Debtor-in-Possession  will have sufficient  funds to fulfill all of the obligations of Tenant under this Lease;
or                (ii) the Bankruptcy  Court shall have entered an order  segregating  sufficient  cash payable
to the  Landlord,  and the  Trustee  or  Debtor-in-Possession  shall have  granted to the  Landlord a valid and
perfected  first lien and  security  interest  or mortgage in  property  of the  Tenant,  the  Trustee,  or the
Debtor-in-Possession,  acceptable as to value and kind to the Landlord,  in order to secure to the Landlord the
obligation  of the Tenant,  Trustee,  or  Debtor-in-Possession  to cure the monetary or  non-monetary  defaults
under the Lease within the time period set forth above.

31.3     Lease  Assignments  in  Bankruptcy   Proceedings.   The  following   conditions  shall  apply  to  any
assignments  of this Lease in bankruptcy  proceedings if the Trustee or  Debtor-in-Possession  has assumed this
Lease and elects to assign the Lease to any other  person,  such interest or estate of Tenant in this Lease may
be so assigned only if the Landlord has  acknowledged in writing that the intended  assignee can provide to the
Landlord  "adequate  assurance of future  performance"  (as herein defined) of all of the terms,  covenants and
conditions  of this Lease to be  performed  by the Tenant.  For the  purposes of this  provision,  Landlord and
Tenant  acknowledge  that,  in the context of a bankruptcy  proceeding,  at a minimum,  "adequate  assurance of
future performance" shall mean that each of the following  conditions has been satisfied,  and the Landlord has
so acknowledged in writing:  (i) the proposed assignee has submitted a current  financial  statement audited by
a  Certified  Public  Accountant  which  shows the net worth and working  capital  and  amounts  determined  by
Landlord to be sufficient  to assure the future  performance  by such  assignee of all of Tenant's  obligations
under this Lease;  (ii) the proposed  assignee,  if requested by the Landlord,  has obtained  guarantys in form
and substance  satisfactory  to the Landlord from one or more persons who satisfy the  Landlord's  standards of
creditworthiness;  and (iii) the Landlord  has  obtained all consents or waivers from any third party  required
under any lease, mortgage,  financing arrangement,  or other agreement by which the Landlord is bound, in order
to permit the Landlord to consent to such assignment.


ARTICLE 32
- ------------------
                                        AMERICANS WITH DISABILITIES ACT
                                        -------------------------------

32.1     Alterations  to Common Areas.  Landlord  shall,  subject to  reimbursement  as part of the  Building's
Operating  Expenses,  be responsible  for any  alterations,  modifications  or improvements to the Common Areas
which are required  under Title III of the Americans With  Disabilities  Act ("ADA").  Landlord  represents and
warrants that Landlord shall cause the Building Shell,  as approved by the City and County of Denver,  to fully
meet with ADA  requirements  within the local  jurisdiction  guidelines,  as these  guidelines were written and
enforced at the time of the  approval of the building  permit for the Building  Shell by the City and County of
Denver,  including access from parking lots, location of parking spaces, and emergency  lighting.  In addition,
Landlord  represents  and warrants that Landlord shall cause the Building Shell to be constructed in accordance
with all other  applicable  building  codes and  ordinances  in  existence  as of the date of  approval  of the
building permit for construction of the Building Shell.

32.2     Alterations  to Premises.  Tenant shall,  at Tenant's sole cost and expense,  be  responsible  for any
alterations,  modifications  or  improvements  to the Premises,  and the  acquisitions  of any auxiliary  aids,
required under the ADA, including all alterations,  modifications,  or improvements  required:  (i) as a result
of Tenant (or any subtenant,  assignee,  or concessionaire)  being a "Public  Accommodation" (as defined in the
ADA);  (ii) as a result of the  Premises  being a  "Commercial  Facility"  (as defined in the ADA);  (iii) as a
result of any  leasehold  improvements  made to the  Premises  by, or on behalf  of,  Tenant or any  subtenant,
assignee,  or concessionaire  (whether or not Landlord's consent to such leasehold  improvements was obtained);
or (iv) as a result  of the  employment  by Tenant  (or any  subtenant,  assignee,  or  concessionaire)  of any
individual with a disability.

32.3     "Use  Clause"  Implications.  With  respect to the use  restrictions  set forth in Section 4.1 of this
Lease,  and the  restrictions on assignments and subletting set forth in Article 17 of this Lease, it is hereby
specifically  understood and agreed that Landlord  shall have no obligation to consent to, or permit,  a use of
the  Premises,  or an  assignment  of the Lease,  or a sublease  of the  Premises  (collectively  herein a "Use
Change") if such Use Change would require the making of any alterations,  modifications, or improvements to the
Premises or the Common Areas, or the  acquisition of any auxiliary aids,  required under the ADA, unless Tenant
performs all such acts and satisfies  Landlord's  requirements  for financial  responsibility  for the costs of
such  compliance  (which may  include,  by way of  example,  posting of a  completion  bond),  Tenant  shall be
responsible for compliance with ADA in the design and layout of the Leasehold  Improvements  and Landlord shall
have no responsibility therefor.

ARTICLE 33
- ------------------
                                                 ATTORNEY FEES
                                                 -------------

         In the event  either  party  defaults  in the  performance  of any of the terms of this  Lease and the
other party  employs an attorney in  connection  therewith,  the  prevailing  party in any action or proceeding
instituted  to enforce  this Lease shall be entitled to recover,  in addition to any other remedy or damages to
which the  prevailing  party may be entitled to recover  pursuant  to the terms of this Lease,  its  reasonable
attorneys' fees and court costs incurred in connection with such action or proceeding.

ARTICLE 34
- ------------------
                                               NO IMPLIED WAIVER
                                               -----------------

         The  failure  of  Landlord  to insist at any time  upon the  strict  performance  of any  covenant  or
agreement  herein,  or to exercise any option,  right,  power or remedy  contained in this Lease,  shall not be
construed  as a waiver or a  relinquishment  thereof  for the  future.  No  payment  by Tenant  or  receipt  by
Landlord of a lesser  amount than the  monthly  installment  of Rent due under this Lease shall be deemed to be
other than on account of the earliest Rent due hereunder,  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 this Lease provided.

ARTICLE 35
- ------------------
                                       LIMITATION OF LANDLORD LIABILITY
                                       --------------------------------

         Redress  for any claim  against  Landlord  under this Lease shall be limited to and  enforceable  only
against and to the extent of  Landlord's  interest in the  Building or any rent or  insurance  or  condemnation
proceeds  therefrom.  The  obligations  of  Landlord  under this Lease are not  intended to be and shall not be
personally  binding on, nor shall any resort be had to, the private  properties  of any of its members,  or its
or their trustees or board of directors or officers,  as the case may be, its manager,  the partners or members
thereof,  or any  beneficiaries,  shareholders,  employees  or agents of  Landlord,  the  manager or any of the
members of Landlord  except to the extent of losses caused  directly and  proximately by Landlord's  failure to
maintain insurance coverage as required pursuant to the terms of  this Lease.

ARTICLE 36
- ------------------
                                               SECURITY DEPOSIT
                                               ----------------

         The  Security  Deposit  shall be paid by Tenant to Landlord on the  Commencement  Date.  The  Security
Deposit  shall be held by Landlord  without  liability  for  interest and as security  for the  performance  by
Tenant of  Tenant's  covenants  and  obligations  under this  Lease,  it being  expressly  understood  that the
Security  Deposit  shall not be  considered  an advance  payment  of rental or a measure  of damages  caused by
Tenant in case of default by Tenant.  Landlord  may  commingle  the  Security  Deposit  with  Landlord's  other
funds.  Landlord may, from time to time,  without  prejudice to any other remedy,  use the Security  Deposit to
the extent  necessary to make good any  arrearage  of rent or to satisfy any other  covenant or  obligation  of
Tenant  hereunder.  Following any such  application  of the Security  Deposit,  Tenant shall pay to Landlord on
demand the amount so applied in order to restore the  Security  Deposit to its  original  amount.  If Tenant is
not in default at the termination of this Lease, the balance of the Security  Deposit  remaining after any such
application  shall be returned  by Landlord to Tenant.  If  Landlord  transfers  its  interest in the  Premises
during the term of this Lease,  Landlord  may assign the  Security  Deposit to the  transferee  and  thereafter
shall have no further liability for the return of such Security Deposit to Tenant.

ARTICLE 37
- ------------------
                                                    NOTICE
                                                    ------

         Any  notice in this Lease  provided  for must,  unless  otherwise  expressly  provided  herein,  be in
writing,  and may, unless otherwise in this Lease expressly  provided,  be given or be served by depositing the
same in the United States mail,  postage paid and  certified  and  addressed to the party to be notified,  with
return  receipt  requested,  or by  delivering  the same in person to an officer of such  party,  or by prepaid
nationally  recognized  overnight courier service,  addressed to the party to be notified at the address stated
below or such other address,  notice of which has been given to the other party.  Notice  deposited in the mail
in the manner  hereinabove  described  shall be effective  from and after the  expiration of three (3) calendar
days after it is so deposited.  Notice  deposited with an overnight  courier service shall be deemed  effective
the day after such deposit.

         Notices to Landlord:       Gateway Office Four, LLC
                                    c/o Paul Powers
                                    3950 Lewiston Street, Suite 100
                                    Aurora, Colorado 80011

         With a copy to:            J. Kevin Ray, Esq.
                                    Campbell Bohn Killin Brittan   Ray, LLC
                                    270 St Paul, Suite 200
                                    Denver, Colorado 80206

         Notices to Tenant:         Frontier Airlines, Inc.
                                    12015 East 46th Avenue, Suite 200
                                    Denver, Colorado 80239-3116
                                    Attention:  Director of Properties and Facilities

         With a copy to:            Randall G. Alt, Esq.
                                    Otten, Johnson, Robinson, Neff   Ragonetti, P.C.
                                    950 17th Street, Suite 1600
                                    Denver, Colorado  80202


ARTICLE 38
- ------------------
                                                 SEVERABILITY
                                                 ------------

         If any term or  provision  of this Lease,  or the  application  thereof to any person or  circumstance
shall,  to any extent,  be invalid or  unenforceable,  the remainder of this Lease,  or the application of such
term  or  provision  to  persons  or  circumstances  other  than  those  as to  which  it is  held  invalid  or
unenforceable,  shall not be affected  thereby,  and each term and  provision  of this Lease shall be valid and
enforced to the fullest extent permitted by law  notwithstanding  the invalidity of any other term or provision
hereof.

ARTICLE 39
- ------------------
                                                  RECORDATION
                                                  -----------

         Tenant agrees not to record this Lease or any memorandum hereof.

ARTICLE 40
- ------------------
                                                 GOVERNING LAW
                                                 -------------

         This Lease and the rights and obligations of the parties hereto shall be interpreted,  construed,  and
enforced in accordance with the laws of the State of Colorado.

ARTICLE 41
- ------------------
                                                 FORCE MAJEURE
                                                 -------------

         Whenever  a period of time is herein  prescribed  for the taking of any  action by either  party,  the
affected  party shall not be liable or  responsible  for, and there shall be excluded from the  computation  of
such period of time,  any delays due to strikes,  riots,  acts of God,  shortages of labor or  materials,  war,
governmental  laws,  regulations  or  restrictions,  or any other cause  whatsoever  beyond the control of that
party.  The foregoing provisions shall not apply to the payment of Rent or other amounts due from Tenant.

ARTICLE 42
- ------------------
                                              TIME OF PERFORMANCE
                                              -------------------

         Except as expressly  otherwise  herein  provided,  with  respect to all  required  acts of the parties
hereto, time is of the essence of this Lease.

ARTICLE 43
- ------------------
                                             TRANSFERS BY LANDLORD
                                             ---------------------

         Landlord  shall  have the right to  transfer  and  assign,  in whole or in part,  all its  rights  and
obligations  hereunder  and in the  Building and  property  referred to herein,  and in such event and upon the
transfer of all of such rights and obligations  hereunder and in the Building and property  referred to herein,
Landlord  shall be released from any further  obligations  hereunder,  and Tenant agrees to look solely to such
successor in interest of Landlord for the performance of such obligations.

ARTICLE 44
- ------------------
                                                  COMMISSIONS
                                                  -----------

         Landlord and Tenant hereby  indemnify and hold each other harmless  against any loss,  claim,  expense
or liability  with respect to any  commissions  or brokerage  fees claimed on account of the  execution  and/or
renewal of this Lease due to any action of the  indemnifying  party.  Landlord  and Tenant each  represent  and
warrant to each other that no broker has been used in  connection  with this Lease except for the broker(s) set
forth on the Lease Summary  hereof,  which  broker(s)  shall be compensated by Landlord  absent an agreement to
the contrary.

ARTICLE 45
- ------------------
                                       EFFECT OF DELIVERY OF THIS LEASE
                                       --------------------------------

         Landlord  has  delivered a copy of this Lease to Tenant for  Tenant's  review  only,  and the delivery
hereof  does not  constitute  an offer to Tenant or option.  This  Lease  shall not be  effective  until a copy
executed by both Landlord and Tenant is delivered to and accepted by Landlord.

ARTICLE 46
- ------------------
                                              CORPORATE AUTHORITY
                                              -------------------

         Each person  signing this Lease on behalf of Tenant  represents  and warrants  that he or she has full
authority  to do so and that this  Lease  binds  the  corporation.  Not  later  than  thirty  (30)  days  after
Landlord's  written  request  therefore,  Tenant shall deliver to Landlord a certified  copy of a resolution of
Tenant's Board of Directors  authorizing  the execution of this Lease or other  evidence of Tenant's  authority
to execute this Lease reasonably acceptable to Landlord.

ARTICLE 47
- ------------------
                                          JOINT AND SEVERAL LIABILITY
                                          ---------------------------

         All parties  signing this Lease as Tenant shall be jointly and  severally  liable for all  obligations
of Tenant.

ARTICLE 48
- ------------------
                                                INTERPRETATION
                                                --------------

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

ARTICLE 49
- ------------------
                               INCORPORATION OF PRIOR AGREEMENTS; MODIFICATIONS
                               ------------------------------------------------

         This Lease is the only  agreement  between the parties  pertaining to the lease of the Premises and no
other  agreements  are  effective.  All amendments to this Lease shall be in writing and signed by all parties.
Any other attempted amendment shall be void.

ARTICLE 50
- ------------------
                                             WAIVER OF JURY TRIAL
                                             --------------------

         Landlord  and  Tenant  by  this  Article  50  waive  trial  by  jury  in any  action,  proceeding,  or
counterclaim  brought by either of the  parties  to this  Lease  against  the other on any  matters  whatsoever
arising out of or in any way connected with this Lease, the  relationship of Landlord and Tenant,  Tenant's use
or occupancy of the Premises,  or any other claims (except claims for personal injury or property damage),  and
any emergency statutory or any other statutory remedy.

ARTICLE 51
- ------------------
                                             ESTOPPEL CERTIFICATES
                                             ---------------------

         Within  fifteen (15) days after  written  request from  Landlord,  Tenant shall execute and deliver to
Landlord  or  Landlord's  designee,  a written  certificate  in the form of  Exhibit  H,  attached  hereto  and
incorporated  herein by this reference or such other  certificate  that certifies that this Lease is unmodified
and in full force and effect  (or if there have been  modifications,  that the same is in full force and effect
as so  modified),  states the dates to which  Rent and other  charges  payable  under the Lease have been paid,
states that  Landlord is not in default  hereunder (or if Tenant  alleges a default  stating the nature of such
alleged  default)  and  further  states  such other  matters  as  Landlord  shall  reasonably  require.  Tenant
acknowledges that any such statement may be relied upon by any Mortgagee,  prospective Mortgagee,  purchaser or
prospective  purchaser  of the Building or any interest  therein.  Tenant's  failure to execute and deliver any
certificate  or agreement  hereunder  within the time required shall be Tenant's  consent that all  information
contained  therein  is true and  correct  and at  Landlord's  election  be a  default  under  this  Lease.  Any
certificate,  instrument,  and/or  agreement  referred to in this Article 51 may at  Landlord's  election be in
recordable form and may at Landlord's election be duly recorded.

ARTICLE 52
- ------------------
                                                   NO MERGER
                                                   ---------

         The voluntary or other  surrender of this Lease by Tenant or the  cancellation of this Lease by mutual
agreement  of Tenant and  Landlord or the  termination  of this Lease on account of Tenant's  default  will not
work a merger,  and will, at Landlord's  option,  (i) terminate all or any subleases and  subtenancies  or (ii)
operate as an  assignment  to Landlord of all or any subleases or  subtenancies.  Landlord's  option under this
Article  52 will be  exercised  by written  notice to Tenant  and all known  sublessees  or  subtenants  in the
Premises or any part of the Premises.

ARTICLE 53
- ------------------
                                                 COUNTERPARTS
                                                 ------------

         This Lease may be executed in  counterparts,  and, when all  counterpart  documents are executed,  the
counterparts shall constitute a single binding instrument.

ARTICLE 54
- ------------------
                                                   EQUIPMENT
                                                   ---------

55.1     Supplemental  Equipment.  Tenant shall have the nonexclusive right, at Tenant's sole cost and expense,
to install and maintain,  at its sole expense  certain  supplemental  equipment  adjacent to the building which
contains the Premises in accordance  with the  provisions  of this Article 54 and the other  provisions of this
Lease.  Such  supplemental   equipment  shall  be  limited  to  an  emergency  generator  with  fuel  tank,  an
uninterruptible  power supply system with batteries,  a supplemental  air  conditioning  system with condensing
units,  and one 6 foot  diameter  satellite  dish for use in  connection  with  Tenant's  business  operations,
together  with  cables  extending  from such  satellite  dish to the  Premises to be located on the roof of the
Building behind the parapet at a location  reasonably  designated by Landlord and reasonably approved by Tenant
(collectively,  the "Supplemental  Equipment").  All such Supplemental  Equipment shall be placed in a location
reasonably  approved by Landlord and Tenant.  Tenant shall have sole  responsibility and liability with respect
to any Supplemental  Equipment's  compliance with: (i) any declaration of covenants  conditions or restrictions
applicable to the Building,  (ii) the roof warranty and (iii) any law, regulation,  ordinance or zoning imposed
by any  governmental  body having  authority  over the Building.  Tenant's  inability to obtain such  approvals
shall not render  this Lease void or  voidable,  and  Landlord  will not be liable to Tenant for any  resultant
loss or damage.  Tenant's  installation  of any  Supplemental  Equipment  shall comply with the  provisions  of
Article 12 of this Lease.  Supplemental  Equipment  shall be  considered as part of the Premises and subject to
all  applicable  terms of the Lease.  The  installation  of  Supplemental  Equipment  shall be by a  contractor
approved  by  Landlord  and in  accordance  with plans and  specifications  approved  by the  Landlord  and all
applicable  governmental  authorities.  Tenant  shall be solely  responsible  for  maintaining  all  insurance,
licenses and permits for any  Supplemental  Equipment and its operation.  Tenant,  at its sole cost and expense
shall cause all  Supplemental  Equipment to be screened  from view by the public with  screening  processes and
materials  reasonably  approved  by  Landlord.  Tenant  shall have the right at its sole risk and  expenses  of
access to the  Building  rooftop  in order to perform  maintenance  on any  rooftop  Supplemental  Equipment  ;
provided  that such  access to the  Building  rooftop  shall,  except in the case of  emergency,  be upon prior
written  notice to  Landlord  and the  Landlord  shall have the right to have a  representative  present.  Upon
termination of the Lease for any reason,  Tenant shall at Tenant's  expense  promptly  remove all  Supplemental
Equipment  and restore the  Building  and the  Premises to their  condition  prior to the  installation  of the
Supplemental  Equipment.  Tenant hereby agrees to indemnify  Landlord against any damage caused to the Building
including  any damage to other  tenants in the  Building  or to the Common  Area  which  result  from  Tenant's
installation or removal of any Supplemental Equipment.  This provision shall survive termination of the Lease.

55.2     Landlord Waiver.  Landlord hereby  acknowledges that Tenant has acquired  equipment,  and will acquire
additional  equipment  (collectively,  the "Equipment"),  under the terms of one or more credit agreements with
lenders,  pursuant to which the lenders have financed  Tenant's  purchase of all or a portion of the Equipment.
A portion of the Equipment  will be installed in the Premises.  Landlord  hereby  disclaims any interest in the
Equipment.  In addition,  Landlord hereby (a) waives,  disclaims and releases any claim of ownership of or lien
on or security  interest in all or any part of the  Equipment,  whether  consensual,  statutory  or  otherwise,
including  without  limitation  any  mechanics',  artisans' or  materialmen's  lien;  (b) to the fullest extent
permitted by law,  waives all rights  granted by or under any present or future law to levy or distraint on the
Equipment,  for  any  sums  due to  Landlord;  (c) acknowledges  that,  regardless  of the  manner  or  mode of
installation  of the Equipment,  the Equipment is and shall  continue to be the personal  property of Tenant or
the  vendor  of the  Equipment,  as the case  may be;  (d) acknowledges  that  the  lenders  under  the  credit
agreements  have (or may have)  financed  Tenant's  purchase  of all or a part of the  Equipment,  and,  to the
extent  that  any of the  Equipment  has  been so  financed,  the  lenders  have a  security  interest  in such
Equipment;  (e) agrees  that the lenders and their agents may, from time to time in accordance  with the credit
agreement and, with Landlord's prior consent,  which consent shall not be unreasonably  withheld or delayed and
if  accompanied  by  Landlord,  enter upon the  Premises  where the  Equipment  is located for the  purposes of
inspecting,  repairing,  removing and/or  conducting a sale or sales of the Equipment,  and that Landlord shall
not hinder or prevent the lender or its agents from taking any such  action;  and  (f) agrees  that the lenders
and its agents are  third-party  beneficiaries  of this  section and that this  section may not be  terminated,
amended,  or modified  without the prior  written  consent of such  lenders.  The right of such lender to enter
onto the Premises shall be  conditioned  on the lender giving notice to the Landlord of its planned entry,  and
the agreement of such lender to repair any damage caused by such entry.

                                                  ARTICLE 55
                                                  ----------
                                                    PARKING
                                                    -------

         Throughout the Lease Term,  Landlord  agrees to make available for Tenant's use, at no cost to Tenant,
not  less  than  ten  (10)  parking  spaces  in the  outdoor  parking  lot to be  constructed  at the  Building
(collectively,  the  "Parking  Spaces")  for each one  thousand  (1,000)  square feet of  Rentable  Area of the
Premises,  or  approximately  one hundred sixty (160) Parking  Spaces.  Approximately  thirty percent (30%), or
approximately  forty-eight  (48) of such  Parking  Spaces  shall be  designated  for  suitable use by "compact"
vehicles  only,  with the remainder  suitable for use by standard sized  vehicles.  Tenant's use of the Parking
Spaces shall be subject to such  reasonable  rules and  regulations  as may be imposed by Landlord from time to
time so long as such rules and  regulations  are  applicable to and uniformly  enforced  against all tenants of
the  Building.  Landlord  shall make the Parking  Spaces  available  for use by Tenant at all times  during the
Lease Term,  provided,  that Landlord's  inability to make such spaces available at any time for reasons beyond
Landlord's  reasonable control shall not constitute a material breach by Landlord of its obligations  hereunder
so long as Landlord makes suitable  substitute  parking  facilities  available for Tenant's use in the vicinity
of the Building  during any period of  unavailability  of parking at the Building . All vehicles  parked in the
parking  areas  and the  personal  property  therein  shall be at the sole  risk of  Tenant,  Tenant's  agents,
employees and invitees and the users of such Parking  Spaces,  and Landlord shall have no liability for loss or
damage thereto for whatever cause.

                                                  ARTICLE 56
                                                  ----------
                                                RESTRICTED USE
                                                --------------

         Landlord  agrees  that  during the Lease  Term,  Landlord  shall not lease any other  premises  in the
Building to another tenant for use as an airline or travel related call center.

                                                  ARTICLE 57
                                                  ----------
                                                   EXHIBITS
                                                   --------

         All Exhibits as listed on the "List of  Agreements"  preceding or attached  hereto,  are  incorporated
herein and made a part of this Lease for all purposes.

         IN WITNESS  WHEREOF,  Landlord and Tenant have executed this Lease (which may be in multiple  original
counterparts) as of the day and year first above written.

LANDLORD:                                                     TENANT:

GATEWAY OFFICE FOUR, LLC,                   FRONTIER AIRLINES, INC.,
a Colorado limited liability company                          a Colorado corporation

By:    GATEWAY BUSINESS PARK, LLC, a                 By:
                                                        -----------------------------------------
       Colorado limited liability company,                    Print Name:
                                                                         ---------------------------------
       its sole member                                        Print Title:
                                                                          --------------------------------

         By:
            -----------------------------------------
              Paul Powers, President and
              Authorized Signatory








                                                         A-1


                                                                                                    Tenant Initials
                                                  EXHIBIT "A"
                                                  -----------

                                              GATEWAY OFFICE FOUR

                                               LEGAL DESCRIPTION









Landlord,  from time to time,  shall have the right to amend this legal  description to accurately  reflect the
legal parcel if and when it becomes  necessary to adjust the legal  description to accommodate  the development
of other adjacent buildings.











                                                         B-1

                                                                                                    Tenant Initials
                                                  EXHIBIT "B"
                                                  -----------

                                              GATEWAY OFFICE FOUR


                                            FLOOR PLAN OF PREMISES


                                   [To be prepared by Landlord and Tenant and
                                inserted upon execution and delivery of Lease.]







                                                         C-1

                                                                                                    Tenant Initials
                                                  EXHIBIT "C"
                                                  -----------

                                              GATEWAY OFFICE FOUR







                                                         D-2

                                                                                                    Tenant Initials
                                              OPERATING EXPENSES
                                              ------------------





                                                         C-3

                                                                                                    Tenant Initials



For purposes of this Lease, "Operating Expenses" shall not include:

                  (1)      costs related to electricity  and other  utilities,  janitorial  services,  and HVAC
         service  (including,  without  limitation,  costs to repair,  maintain  and  replace  systems  used in
         connection  with the  provision of those  services)  supplied to any areas of the  Building  which are
         leased to tenants;

                  (2)      depreciation on the Building;

                  (3)      costs  of  alterations  of  space or other  improvements  made  for  tenants  of the
         Building;

                  (4)      finders' fees and real estate brokers' commissions;

                  (5)      ground lease payments, mortgage principal or interest;

                  (6)      costs of  excess or  additional  services  provided  to any  tenant in the  Building
         which are billed directly to such tenants;

                  (7)      any cost  due to  Landlord's  breach  of any  contract,  or any  tort  liability  of
         Landlord;

                  (8)      all costs,  including legal fees,  relating to activities for the  solicitation  and
         execution of leases of space in the Building;

                  (9)      any legal fees  incurred by Landlord in enforcing  its rights under other leases for
         premises in the Building;

                  (10)     wages  (including  fringe  benefits)  of  executives  above  the  grade of  building
         manager;

                  (11)     the portion of costs  incurred in  performing  work or  furnishing  services for any
         tenant,  whether at such  tenant's or Landlord's  expense,  to the extent that such work or service is
         in excess of any work or service  that  Landlord  is obliged  to  furnish to Tenant  pursuant  to this
         Lease without additional payment by Tenant;

                  (12)     costs or expenses for which  Landlord  has  received or is to receive  reimbursement
         from the proceeds of  insurance,  condemnation  awards,  guarantee,  or any other  source  (other than
         reimbursement of Operating Expenses);

                  (13)     costs incurred in relocating tenants in the Building;

                  (14)     costs incurred in connection  with the transfer or  disposition of the Building,  or
         any portion thereof, or any interest therein,  including,  without limitation,  brokerage commissions,
         attorneys' fees and disbursements, transfer taxes, gains taxes and recording charges;

                  (15)     the cost of works of art of the quality and nature of "fine art";

                  (16)     rent paid under superior leases; and

                  (17)     the portion of any fee or expenditure  for any purpose  whatsoever  paid to Landlord
         or to an entity  affiliated  with Landlord which exceeds the amount which would be paid in the absence
         of such relationship;

                  (18)     Landlord's  general  corporate  overhead  and general and  administrative  expenses,
         except to the extent included in Landlord's management fee;

                  (19)     Advertising and promotional  expenditures,  excluding the cost of signs in or on the
         Building or project identifying the owner of the Building or project or other tenants' signs;

                  (20)     Costs  arising  from the  negligence  or fault of other  tenants or  Landlord or its
         agents,  or any  vendors,  contractors,  or providers  of  materials  or services  selected,  hired or
         engaged  by  Landlord  or  its  agents  including,  without  limitation,  the  selection  of  building
         materials;

                  (21)     any and all costs  arising from the presence of Hazardous  Materials in or about the
         Premises or the Building including,  without limitation,  hazardous  substances in the ground water or
         soil, not placed in the Premises or the Building by Tenant;

                  (22)     Landlord's charitable or political contributions;

                  (23)     Costs  associated  with the operation of the business of the  partnership  or entity
         which  constitutes  Landlord  or its  principals,  as the same  are  distinguished  from the  costs of
         operation of the project,  including partnership  accounting and legal matters, costs of defending any
         lawsuits  with any  mortgagee  (except as the  actions of Tenant may be in issue),  costs of  selling,
         syndicating,  financing,  mortgaging or hypothecating any of Landlord's interest in the project, costs
         of any  disputes  between  Landlord  and its  employees  (if any) not  engaged in  project  operation,
         disputes of Landlord with building  management,  or outside fees paid in connection with disputes with
         other tenants;

(24)     Costs of any tap fees, or any sewer water  connection  fees for the benefit of any  particular  tenant
         in the project;

(25)     Any flowers,  gifts,  balloons,  etc. provided to any entity whatsoever,  including but not limited to
         Tenant, other tenants, employees, vendors, contractors, prospective tenants and agents;

(26)     Any "validated" parking for any entity; or

(27)     "In-house"  legal and/or  accounting  fees except to the extent included in the management fee payable
         to Landlord.

Landlord  further  agrees  that since one of the  purposes of  Operating  Expenses  and the gross up  provision
herein is to allow  Landlord to require  Tenant to pay for the costs  attributable  to its  Premises,  Landlord
agrees  that  (i) Landlord  will not  collect or be  entitled  to collect  Operating  Expenses  from all of its
tenants in an amount which is in excess of one hundred percent  (100%) of the Operating  Expenses actually paid
by Landlord in  connection  with the  operation of the Building,  and  (ii) Landlord  shall make no profit from
Landlord's collections of Operating Expenses.

Landlord  estimates  that  Operating  Expenses  for the  first  year of the  Building's  operation  shall be as
follows:





ITEM:                                                                  PRICE PER SQUARE FOOT
- -----                                                                  ---------------------


Irrigation Water/Exterior Lighting                                                    $0.12

Snow Removal                                                                          $0.06

Landscaping                                                                           $0.09

Management Fee                                                                        $0.29

Engineer                                                                              $0.03

Taxes                                                                                 $2.50

Insurance                                                                             $0.08

Security/Life                                                                         $0.01

Sweeping                                                                              $0.01


ESTIMATED TOTAL PER SQUARE FOOT:                                                      $3.19

The foregoing is an estimate only.  Actual Operating  Expenses may vary.  Operating  Expenses exclude utilities
and janitorial services, which Tenant shall be responsible for providing to the Premises.





                                                        D-10

                                                                                                    Tenant Initials
                                                  EXHIBIT "D"
                                                  -----------

                                              GATEWAY OFFICE FOUR

                                                  WORK LETTER



         This Work Letter  supplements the Lease Agreement (the "Lease") dated  concurrently  herewith,  by and
between GATEWAY OFFICE FOUR, LLC, a Colorado limited liability  company,  as Landlord,  and FRONTIER  AIRLINES,
INC., a Colorado  corporation,  as Tenant,  covering the Premises.  All terms not defined herein shall have the
same meaning as set forth in the Lease.

1.       Construction of Building.

                  1.1      Base Building Improvements.  Landlord has constructed,  or shall construct,  through
its contractor,  at Landlord's sole cost, a building  shell,  including the (the "Base Building  Improvements")
listed on the Revised Scope of Work dated as of December 8, 2000 and attached hereto::

                  1.2      Tenant  Improvements  Descriptions.  Tenant  shall,  at its sole  cost and  expense,
complete  all  improvements  to the  Premises  (the  "Tenant  Improvements"),  other  than  the  Base  Building
Improvements.  Without  limiting the  generality of the foregoing  description  of Base Building  Improvements,
Tenant Improvements shall include the following items:

                           a.       ceiling and lighting in the Premises;

                           b.       floor finishes in the Premises, including carpet as selected by Tenant;

                           c.       interior finishes of any kind within the Premises;

                           d.       interior  partitions,  demising  walls  (provided  that Landlord and Tenant
                                    shall each pay fifty  percent  (50%) of the cost of such  demising  walls),
                                    doors and hardware within the Premises;

                           e.       all  heating,  ventilating  and air  conditioning  equipment  and other air
                                    distribution  devices,  including  distribution  systems  and  controls  or
                                    supplemental systems;

f.       electrical  and  plumbing  services  from the core of the  Building  as  provided in the Scope of Base
                                    Building Improvements;

g.       modifications  to the automatic fire sprinkler  system as required for Tenant's layout as set forth on
                                    "Tenant's Schematic Space Plans" (as hereinafter defined);

                           h.       fire and life safety  systems  throughout the Premises,  including  without
                                    limitation exit signs, horn/strobe or intercoms and extinguishers;

                            i.      window  coverings,  consisting  of  Levelor,  Riviera or Newport  one inch,
                                    eight gauge horizontal mini-blinds in a color approved by Landlord;

                           j.       architectural and engineering  preparation of plans and  specifications for
                                    the Tenant Improvements to conform to Building standards;

                           k.       permits and fees to local jurisdictions;

                           l.       signage;

                           m.       men's and women's restroom facilities; and

                           n.       such other costs as are described in Section 3.2 hereinbelow.

2.       Plans and Specifications for Tenant Improvements.

                  2.1      Tenant has  retained  Reddy   Reddy as its  licensed  architect to prepare the plans
and  specifications  for the Tenant  Improvements.  All such plans and  specifications  shall be  submitted  to
Landlord for its approval prior to commencement of  construction  of any Tenant  Improvements.  Notwithstanding
anything to the  contrary,  Tenant has or will engage and utilize  Priest  Engineering  as its  mechanical  and
electrical engineers, which has been approved by Landlord.

                  2.2      Tenant  shall cause its  architect to furnish to Landlord  for  Landlord's  approval
space plans sufficient to convey the  architectural  design of Tenant  Improvements to be constructed by Tenant
in the Premises,  including,  without limitation,  the location of doors, partitions,  electrical and telephone
outlets,  plumbing  fixtures,  heavy floor  loads and other  special  requirements,  together  with  reflective
ceiling plans  ("Tenant's  Schematic  Space Plans").  If Landlord  shall  disapprove of any portion of Tenant's
Schematic  Space  Plans,  Landlord  shall  advise  Tenant  of such  revisions,  and  reasons  therefor,  as are
reasonably  required by Landlord for the purpose of obtaining  approval.  Tenant shall then submit to Landlord,
for Landlord's  approval,  a redesign of Tenant's  Schematic Space Plans,  incorporating the revisions required
by Landlord and such  modifications  thereof as are suggested by Tenant,  said modifications to be subsequently
approved  by  Landlord  prior to  Tenant's  submission  of  Final  Plans  (as  hereinafter  defined).  Landlord
acknowledges  that  construction  of  the  Tenant  Improvements  is  a  "fast-track"  project,  and  agrees  to
expeditiously review and cooperate with Tenant to approve Tenant's Schematic Space Plans and Final Plans.

                  2.3      Tenant  shall cause its  architect to prepare from  Tenant's  Schematic  Space Plans
(approved  by Landlord in  accordance  with  Section 2.2 above)  complete  architectural  plans,  drawings  and
specifications and, utilizing Landlord's approved  mechanical,  electrical and structural  engineers,  complete
engineered and cross  coordinated  mechanical,  electrical and structural  working  drawings for (i) all of the
Premises,  showing the  subdivision,  layout,  finish and decoration work (including  carpeting and other floor
coverings)  desired by Tenant  therefor,  and (ii) any internal or external  communications  or special utility
facilities which will require conduiting or other improvements  outside premises,  all in such form and in such
detail as may be  reasonably  required by  Landlord.  Such  complete  plans,  drawings and  specifications  are
referred to herein as the "Final Plans".  Tenant's  Final Plans shall (i) be compatible  with the Base Building
Improvements,  (ii)  comply with all  applicable  laws and  ordinances,  and the rules and  regulations  of all
governmental  authorities having jurisdiction,  and (iii) comply with all applicable insurance  regulations for
the  Building.  Tenant  shall  submit  the Final  Plans for the  approval  of  Landlord  in the same  manner as
provided in Section 2.2 above for approval by Landlord of Tenant's Schematic Space Plans.

                  2.4      Tenant  acknowledges that, unless  specifically  shown as Landlord's  responsibility
on the Final Plans,  the Tenant  Improvements  shall not include,  nor shall Landlord be  responsible  for, the
design,  construction or installation  of various  nonstructural  items which Tenant may find desirable for the
Premises   including,   without   limitation,   furniture,   trade  fixtures,   office  equipment,   telephone,
telecommunications  and data  equipment and systems,  plantscaping,  artwork or cabling  required in connection
with any of these items.  Notwithstanding  the fact that  Landlord's  architects  and engineers  shall have the
right to review  Tenant's  Schematic Space Plans and Tenant's Final Plans,  Tenant shall be solely  responsible
for the design and function of such plans,  including,  without  limitation,  their integration with all of the
Building's systems.

                  2.5      Landlord  shall  cooperate  with Tenant in obtaining  approval of the Final Plans by
all governmental agencies having jurisdiction.

                  2.6      Tenant  shall cause its  architect to provide  documentation  for all changes to the
Final Plans at the time each  change is  authorized  by  Landlord  for  construction.  Within  thirty (30) days
after the date of  substantial  completion  of the Tenant  Improvements,  Tenant's  architect  shall  submit to
Landlord  a set of  conformed  plans on mylar  incorporating  all field  changes  made and all  changes  and/or
revisions that have been made subsequent to Landlord's approval of the Final Plans.

3.       Tenant Improvements.

                  3.1      Tenant shall be solely  responsible  for the payment of all costs to  construct  the
Tenant Improvements, including all "Work Costs"  (as hereinafter defined).

                  3.2      As used herein,  "Work  Costs" mean (i) all fees and expenses  incurred by Tenant in
connection with the design and construction of the Tenant  Improvements;  (ii) the actual  contractor costs and
charges for material and labor,  contractor's  profit,  overhead and general  conditions  incurred by Tenant in
having the Tenant  Improvements  constructed in accordance with the Final Plans; (iii) governmental agency plan
check,  permit and other fees and sales and use taxes;  (iv) testing and  inspection  costs;  and (v) any paint
touch-up or repair work  necessary due to Tenant's  move into the  Premises.  Tenant hereby agrees to pay a fee
to be paid to Landlord  equal to two percent  (2%) of all Tenant Work Costs for  administration  by Landlord of
construction of the Tenant Improvements.

                  3.3      Work Costs shall also  include all costs  incurred  by Landlord in  performing  work
for Tenant during  construction  of the Building  Shell or work  performed by Landlord at Tenant's  request and
approved by Tenant in connection with the completion of the Tenant  Improvements  ("Additional  Work").  In the
event that Tenant  requests  Landlord to perform  Additional  Work associated with the Building Shell or Tenant
Improvements, the following procedure will apply:

a.       Tenant will provide a written  request for the  Additional  Work to be performed.  Tenant will provide
                  drawings as required  for a clear and accurate  determination  of the  Additional  Work to be
                  performed by Landlord.

b.       Landlord will estimate the cost of the Additional Work requested and will provide a written cost
                  response for such work, including the management fee described in Section 3.2 above.

c.       Tenant shall approve the cost of the Additional Work and shall sign off on the cost estimate prior
                  to Landlord's commencement of the Additional Work.

d.       Landlord shall submit an invoice for such Additional Work to Tenant upon Tenant's approval of the
                  cost estimate authorizing such Additional Work.  Tenant will pay Landlord for Additional
                  Work within ten (10) days following its receipt of such invoice.

                  3.4      If the Final Plans or any  amendment  thereof or  supplement  thereto  shall require
changes in the Base Building  Improvements,  the increased  cost of the Base  Building  Improvements  caused by
such  changes  shall be charged  to Tenant as  Additional  Work.  The cost  thereof  shall  include  all direct
architectural and/or engineering fees and expenses in connection therewith.

                  3.5      Landlord's  written  estimate  of the  cost  of  Additional  Work  shall  include  a
reasonable  contingency of 10% to allow for changes in the Tenant  Improvements  and/or other  unforeseen costs
and expenses arising after Tenant's approval thereof.


                  3.6      Any changes to the approved  Final Plans  ("Changes")  which are requested by Tenant
or required by any  governmental  agency  shall be forwarded  to Landlord  for  approval.  Tenant shall pay the
cost of the Changes in accordance  with the provisions of Section 3.1 above.  Any delay in the  construction of
Tenant  Improvements  as a result of Changes or payment of the cost thereof shall be a Tenant Delay (as defined
in Section 7 below).

4.       Construction.

         4.1      In  connection  with  the  construction  of the  Tenant  Improvements,  each  party  shall be
entitled  to rely upon the other  party's  construction  representative  who  shall be as  follows:  Landlord's
construction   representative   ("Landlord's   Construction   Representative"):Richard   E.   Quinn,   Tenant's
construction  representative ("Tenant's Construction  Representative"):Cornelius  "Casey" Baas. Each respective
construction  representative  shall have the  authority  to make  binding  commitments  relative  to the Tenant
Improvements  on behalf of the party  appointing  such  construction  representative.  All  inquiries of Tenant
pertaining  to  construction  of the  Building  Shell shall be directed in writing to  Landlord's  Construction
Representative.  A party may designate a substitute  construction  representative  by giving  written notice to
the other  party at any  time.  Any  representatives  of  Tenant  who  desires  to visit  the  Premises  during
construction of the Tenant Improvements must obtain the prior consent of Landlord and the General Contractor.

4.2      Early Access:  In the event Tenant  wishes to begin the Tenant  Improvements  prior to the  completion
of the  Building  Shell by  Landlord,  Landlord  will permit such access so long as the  following  (the "Shell
Improvements") have been completed:

a.       All required insurance and permits for Tenant Improvements are in place and have been issued;

b.       All perimeter concrete pour back strips have been poured;

c.       Structural roof deck and the roof substantially weather tight;

d.       Perimeter walls have been erected and welded into place;

e.       Sprinkler  mains and  laterals  and  perimeter  glass and glazing  installation  work shall be ongoing
(provided,  that if  glazing  has not been  completed,  Landlord  shall  hang  plastic  sheeting  in all window
openings in the Premises; and

f.       A punchlist for the Building Shell has been established as described in Section 5.

          Tenant  acknowledges  that the  foregoing  requirements  are for the  primary  benefit  of Tenant and
Tenant  will be  working in  cooperation  with  Landlord's  General  Contractor.  In the event  disputes  arise
between Landlord's General Contractor and Tenant's  Contractor,  Tenant's right to early access to the Premises
may be  terminated  by Landlord  without  notice with respect to the disputed  work area.  Any delays caused by
Tenant shall be considered a "Tenant Delay" (as hereinafter defined).

5.       Base  Building  Punch  List.  On  or  before  the  date  Tenant  begins  construction  of  the  Tenant
Improvements,   Landlord  shall  cause  its  General   Contractor  to  inspect  the  Premises  with  Landlord's
Construction  Representative and Tenant's  Construction  Representative and to complete a written punch list of
unfinished items of Base Building  Improvements  prior to Tenant's  construction  mobilization in the Premises.
Landlord,  Landlords General  Contractor and Tenant's  Construction  Representative  shall execute said written
punch list to indicate  approval thereof,  and Landlord shall cause its General  Contractor to correct all such
punch list items with reasonable diligence.

6.       Schedule.  Preparation and approval of Tenant's  Schematic Space Plans,  Final Plans and the Work Cost
Estimate,  if any,  shall  proceed as indicated  below and each action shall be completed on or before the date
herein specified.  Time is of the essence.

         Action                                   Responsibility                Due Date
         ------                                   --------------                --------

(i)      Submission of Tenant's                       Tenant                    Ten (10) days following
         Schematic Space Plans                                                  mutual execution of the
         to Landlord                                                            Lease

(ii)     Delivery of written                         Landlord                   Five (5) days following
         approval of Tenant's                                                   submittal of Tenant's
         Schematic Space Plans to                                               Schematic Space Plans
         Tenant (including any                                                  to Landlord
         necessary design revision comments)

(iii)    Submission of Final                          Tenant                    Twenty-one (21) days
         Plans to Landlord for                                                  following Landlord's
         approval                                                               approval of the Tenant's
                                                                                Schematic Space Plans

(iv)     Delivery of written                         Landlord                   Five (5) days following
         approval of Final Plans                                                submittal of Final Plans
         to Tenant including                                                    to Landlord
         any necessary design
         revision comments

7.       Delays.  If  Landlord  shall be  materially  delayed in  substantially  completing  the Base  Building
Improvements as a result of any of the following ("Tenant Delays"):

                  a.       Tenant's failure to complete any action item which is the  responsibility  of Tenant
                           on or before  the due date  specified  in  Section 6 above to the  extent  that such
                           failure is not caused by failure of Landlord to timely  perform its  obligations  in
                           accordance with the schedule in Section 6, or

                  b.       Any  delay  of  Tenant  in  making  payment  to  Landlord  of  the  Additional  Work
                           performed by Tenant as provided in Section 3.3 above, or

                  c.       Any other delay requested or caused by Tenant,

then the Lease Term  shall  nevertheless  commence  and the  Commencement  Date shall be the date it would have
been had the delay not occurred.

8.       Final  Acceptance  of Tenants  Premises by Landlord.  Landlord's  acceptance  of the Premises with all
         Tenant Improvements shall be subject to Tenant's delivery to Landlord of the following:

a.       Building Permit;

b.       Certificate of Occupancy;

c.       Air Balance Report;

d.       List of Subcontractors;

e.       Subcontractors' Warranties/Guaranties;

f.       Ownership and Maintenance Manuals;

g.       "As-Built" plans and specifications;

h.       General Contractor's Warranty;

i.       Confirmation that punchlist items have been completed; and

j.       Final Lien Releases

9.       Miscellaneous.  Any default by Tenant under the terms of this Work Letter  shall  constitute a default
under the Lease and shall  entitle  Landlord to exercise  all  remedies set forth  therein.  Both  Landlord and
Tenant agree to use reasonable  diligence in performing all of their  respective  obligations  and duties under
this Work  Letter and in  proceeding  with the  construction  and  completion  of the  Building  and all Tenant
Improvements in the Premises.






LANDLORD:                                                     TENANT:

GATEWAY OFFICE FOUR, LLC,                   FRONTIER AIRLINES, INC., a
a Colorado limited liability company                          Colorado corporation

By:    GATEWAY BUSINESS PARK, LLC, a                 By:
                                                        -----------------------------------------
       Colorado limited liability company,                    Print Name:
                                                                         ---------------------------------
       its sole member                                        Print Title:
                                                                          --------------------------------

         By:
            -----------------------------------------
              Paul Powers, President and
              Authorized Signatory



                                                 ATTACHMENT 1
                                                 ------------
                                                TO EXHIBIT "D"
                                                --------------

                                              GATEWAY OFFICE FOUR


                                             REVISED SCOPE OF WORK


                                                 GATEWAY PARK
                                                 OFFICE CAMPUS

                                  SINGLE STORY, MULTI-TENANT OFFICE BUILDING

                                             4400 Kittredge Street
                                               Denver, Colorado


                                               December 8, 2000


GENERAL BUILDING SPECIFICATIONS:
- --------------------------------

         Building Size:                                       Approximately 62,556 SF
                                                                            ------
         Site Description:                                    Lot 1, Block 1
         Clear Height:                                        12'
         Parking Spaces Provided:                             10:1,000 s.f.  (per Frontier's lease of 16,070
                                                              -------------
                                                              s.f.)
         Bay Sizes Per Layout:                                36' x 43'
         Automatic Fire Sprinkler System:                     V-N, fully sprinkled
         One Story
         Tilt-Up Concrete Wall Construction
         Roof Insulation:                                     R-12.5
         Wall Insulation:                                     None
         Electrical Service:                                  1600 amps, 3-phase, 480 volt
         Asphalt Paving:                                      6 " in parking area, 7"-fire lane
         Slab on Grade:                                       5"
         Foundation System:                                   Spread Footings
         Utilities:                                           2" water
                                                              6" sewer
         Roof Slope:                                          1/4" : 12"


                  NOTE:  The proposed Building does not have a designed HVAC system.

DIVISION 1 - GENERAL REQUIREMENTS

1.       On-site project superintendent
2.       Project management
3.       Field engineering and layout
4.       Concrete, soil compaction, steel, and soil observation/testing
5.       Project office, telephone, and sanitary facilities
6.       Clean-up and close-out
7.       Building permit and plan check fee
8.       State and local taxes
9.       Contractor's general liability
10.      Job site safety provisions
11.      Sewer and water and drainage fees
12.      Design:  Architectural, Structural, Civil Engineering, Plumbing, Electrical, Landscape


DIVISION 2 - SITEWORK
- ---------------------

1.   Clear and grub site
2.   Structural excavation and backfill
3.   Rough and fine grading as required
4.       Exterior sidewalks and handicap ramps.  Perimeter sidewalks adjacent to building will have
     positive drainage away from building
5.       6" full-depth  asphalt paving in the parking lot and 7 " full-depth  asphalt in the life safety access
     areas (subject to soils engineer approval)
6.   Parking lot striping and handicap markings
7.       Four (4) new curb cuts as shown on the site plan and all on-site curb and gutter is
     included
8.   Landscaping including seeding, irrigation, sodding, deciduous and evergreen trees and shrubs
     per landscape plan
9.       Site utilities including 6" sewer and 2" water service to building from Kittredge Street,
      Contractor to field verify underground utilities and curbs at perimeter of site
10.      No underslab gravel is included
11.      Fire hydrants are included per Denver Fire Department requirements










DIVISION 3 - CONCRETE
- ---------------------

1.   Foundations  to consist of spread  footings.  Actual design will be per the soils  investigation  prepared
     by Ground Engineering, Project Number 00-00271, dated September 5, 2000.

2.   Slab-on-grade for each area of the facility shall be as follows:

a.       Office area:  5" thick, 3,500 psi reinforced with 6/6 x 6/6 wwf on chairs and pumped
b.       Concrete accessories as required (i.e. control joints, expansion joint material, anchor bolts,
              sawcut, etc.)
3.   Sawcut shall be caulked in all exterior concrete paving
4.       Exterior walls shall be site-cast tilt-up panels.  Panels shall have smooth painted finish.
5.       All interior slabs will be soft cut appropriately after placement
6.       During construction, exposed earth at perimeter floor slab shall be protected from erosion


DIVISION 5 - METALS
- -------------------

1.   Structural steel columns, truss girders, bar joists, "B" roof deck
2.   Miscellaneous steel as required including lintels, angles, bearing plates, handrails, stairs, etc.


DIVISION 6 - CARPENTRY
- ----------------------

1.   Rough framing material and labor (i.e. window openings, parapet walls, and miscellaneous blocking)
2.   Material and labor for carpentry, patching, hanging of doors/hardware and other miscellaneous finish
     carpentry


DIVISION 7 - THERMAL AND MOISTURE PROTECTION
- --------------------------------------------

1.       Roof:  Ballasted 45 ML EPDM over 1.9" Isocyanurate roof insulation, R-12.5, tapered EPS insulation
     crickets at low wall, 10' wide perimeter high wind ballast, 10-year roof warranty
2.       No interior wall insulation is included
3.       Caulking and flashings as required
4.       Rigid insulation at perimeter foundation walls
5.       Open faced downspouts with conductor heads located to direct water away from office and
      door locations and not direct water under pavement areas or onto sidewalk
6.       No skylights
7.       Bilco roof scuttle with safety extension posts


DIVISION 8 - DOORS, WINDOWS, GLAZING
- ------------------------------------

1.       Exterior window system by Southwest Aluminum of 50% Kynar anodized bronze aluminum with 1" tinted
     gray I-6 insulated glazing.  3' x 7' storefront doors with mail slots
2.       Exterior storefront doors to match exterior glazing system, with panic bars if required by code
3.       Glazing to be light gray I-6 in color
4.       Hollow metal frames and doors at exterior as shown and doors to mechanical and electrical closets
5.       Hardware assumes 11/2" pair of hinges per door leaf with commercial-grade lever sets


DIVISION 9 - FINISHES
- ---------------------

1.       All exterior walls, metal doors and frames, exposed flashings, and other ferrous metals shall be
     painted
2.       Drywall and metal stud framed electrical and fire sprinkler room
3.       Knox box


DIVISION 15 - MECHANICAL
- ------------------------

1.   Plumbing system

     a.  Utilities to building include:
         Floor drain (sprinkler room)
         Clean outs
         Site clean out
         11/2" water line meter
         11/2" reduce pressure backflow preventor
         2" water line to building and domestic line
         Sprinkler backflow preventor
         6" sewer line to building and running through building as shown
         8" fire protection water line with 8" backflow preventor

2.       Complete Automatic Fire Sprinkler System:  NFPA 13 Ordinary Hazard Group II
     Assumed water flow data:                        Static:                      85 psi
                                                     Residual:                    80 psi
                                                     Flow:                      1250 gpm
3.       Gas to a central manifold to be designed at 2lbs throughout
4.       HVAC:  Complete HVAC System and  associated  rooftop unit  screening  (per approved RTU screen detail)
     responsibility of Tenant.


DIVISION 16 - ELECTRICAL
- ------------------------

1.       Service1600 amp, 120/208/480 volt, 3-phase with laterals at a common electrical room
2.       One (1) 1600 amp, 480 volt, 3-phase bussed gutter
     One (1) 100 amp, 480 volt, 3-phase disconnect
     30 KVA Transformer
3.   Lighting design:
a.       No interior lighting is included
b.       4" Telephone conduit from property line to building telephone room.
c.       Sign circuits/hook up to monument sign
d.       Flow/tamper switch hook up
e.       Outside horn/strobe hook up and Fire Alarm Panel
f.       4" PVC for future power underslab
g.       2" PVC for future phones underslab
h.       Plug phone board
i.       Plug by electrical room
j.       Plug by sprinkler clock
k.       Building perimeter and parking lot lighting

4.   Emergency Power - by Tenant - will require screening of unit at Tenant's cost






                                                         E-3

                                                                                                    Tenant Initials
                                                  EXHIBIT "E"
                                                  -----------

                                              GATEWAY OFFICE FOUR

                                        BUILDING RULES AND REGULATIONS

1.       Tenant, or its officers,  agents,  employees,  contractors or vendors,  shall not obstruct  sidewalks,
doorways,  vestibules,  halls, corridors,  stairways,  lobbies and other common areas (the "Common Areas") with
refuse,  furniture,  boxes,  or other  items.  The Common  Areas shall not be used for any  purpose  other than
ingress and egress to and from the  Premises,  or for going from one part of the  Building  to another  part of
the  Building.  Tenant's  doors to the Premises  shall not be blocked open and shall remain closed at all times
unless first approved in writing by Landlord in its sole discretion.

2.       Plumbing,  fixtures and appliances shall be used only for the purposes for which  constructed,  and no
unsuitable material shall be placed therein.

3.       No signs,  directories,  posters,  advertisements,  or  notices  shall be painted on or affixed to any
portion of the  Building  or Premises or other parts of the  Building  or within  Tenant's  Premises  which are
visible from any Common Areas or the Building  exterior,  except in such color,  size,  and style,  and in such
places,  as shall be first approved in writing by Landlord,  which consent shall not be  unreasonably  withheld
or delayed.  The Premises  shall be identified by a standard  suite sign which Landlord shall order at Tenant's
expense.  Landlord  shall  have the right to remove  all  unapproved  signs  upon  prior  reasonable  notice to
Tenant,  at Tenant's  expense.  Landlord shall include one listing (or more at Landlord's sole  discretion) for
Tenant on its directory of Tenants.

4.       Except  as  otherwise  expressly  permitted  pursuant  to the  Lease,  Tenant  shall not do, or permit
anything  to be done in or about  the  Building,  or  bring  or keep  anything  therein,  that  will in any way
increase  the  possibility  of fire or  other  hazard  or  increase  rate of  fire or  other  insurance  on the
Building.  Tenant  shall not use or keep in the  Building any  inflammable  or explosive  fluid or substance or
any  illuminating  materials.  No space  heaters or portable  fans shall be operated  in the  Building.  Tenant
must submit to Landlord a  certificate  of Fire  Retardancy  for any fresh  evergreens  (i.e.  Christmas  tree,
wreaths) to be brought onto the Premises.

5.       Tenant shall cooperate with Landlord in keeping the Premises neat and clean.

6.       Tenant  shall not  interfere,  injure or annoy in any way other  tenants in the  Building,  or persons
having business with them.

7.       No animals  shall be brought into or kept in or about the  Building,  with the exception of seeing eye
dogs.

8.       When  conditions are such that Tenant must dispose of small shipping  crates or boxes,  it will be the
responsibility  of Tenant to break down and dispose of same in the refuse  container  designated  by  Landlord.
The disposal of large  shipping  crates or boxes (or other large  objects or  quantities),  which in Landlord's
sole  determination  could overload the designated  refuse  container,  must be accommodated  through  Tenant's
mover or vendor or may otherwise be prearranged through Landlord at an additional charge to Tenant's account.

9.       No machinery of any kind,  other than  ordinary  office  machines  such as  typewriters,  calculators,
facsimile  equipment,  personal computer  equipment,  telephone PBX equipment,  servers and cleaning  equipment
shall be operated on the Premises unless first approved in writing by Landlord in its sole discretion.

10.      No bicycles, motorcycles or similar vehicles will be allowed in the Building.

11.      After Normal Business Hours,  Landlord  reserves the right to exclude from the Building any person who
does  not  possess  an  authorized  means  of  access  such  as a  key,  card  key,  or a  prearranged  written
authorization  and who is otherwise  not an employee or guest of Tenant.  In no event shall Tenant allow access
to the Premises or the Building to anyone other than its officers, agents, employees, guests or vendors.

12.      Canvassing,  soliciting and peddling in Common Areas, or otherwise  within the Building,  are strictly
prohibited.  Unless otherwise  approved by Landlord in writing,  Tenant shall not use the Premises for the sale
of  newspapers,  magazines,  periodicals  or theater  tickets to other  tenants in the  Building or the general
public.  Tenant shall not use the Premises for any business or activity other than that  specifically  provided
for in Tenant's lease.  Tenant shall not make  door-to-door  solicitation of business from other tenants in the
Building.

13.      Tenant shall  initially be given  fifteen (15) keys to the  Premises by  Landlord.  No  duplicates  of
such keys shall be made by  Tenant.  Additional  keys  shall be  obtained  only from  Landlord,  at a fee to be
determined by Landlord.  No additional  locks shall be placed upon any doors unless first  approved by Landlord
in writing.  Upon  termination  of Tenant's  lease,  Tenant shall  surrender all keys to the Premises  (and, if
applicable,  card keys) to Landlord  and shall  otherwise  give  Landlord the  combination  of all locks on the
Premises.

14.      Tenant will not locate  furnishings or cabinets  adjacent to mechanical or electrical access panels or
over air  conditioning  outlets so as to prevent  operating  personnel  from servicing such units as routine or
emergency  access  may  require.  Cost of moving  such  furnishings  for  Landlord's  access  will be billed to
Tenant.

15.      Subject to rights  granted to Tenant under the Lease,  Tenant shall comply with all parking  rules and
regulations as posted and distributed by Landlord from time to time.

16.      No portion of the Building shall be used for the purpose of lodging rooms.

17.      Tenant  shall  not  waste  electricity,  water  or  other  utilities.  Tenant  will  comply  with  any
governmental  energy-saving  rules,  laws or regulations of which Tenant has received notice.  Tenant agrees to
cooperate  fully  with  Landlord  to  assure  the  effective  operation  of  the  Building's  heating  and  air
conditioning.

18.      Vending  machines or  dispensing  machines  of any kind shall not be placed in the  Premises by Tenant
other than for the sole use of Tenant and its  employees,  unless first  approved in writing by Landlord in its
sole discretion.

19.      Landlord's  written approval,  which shall be at Landlord's  reasonable  discretion,  must be obtained
prior to changing from the standard  blinds.  Landlord  will control all blinds and internal  lighting that may
be  visible  from the  exterior  or  Common  Areas of the  Building  and shall  have the  right to  change  any
unapproved blinds and lighting at Tenant's expense.

20.      Except as provided in the Lease,  Tenant shall not make any changes or  alterations  to any portion of
the Building without  Landlord's prior written approval,  which may be given on such conditions as Landlord may
require in its sole discretion.

21.      Tenant shall not use the name of the Building in connection  with or in promoting or  advertising  the
business of Tenant except as Tenant's address,  without  Landlord's prior written approval,  which may be given
on such conditions as Landlord may require in its sole discretion.

22.      Tenant shall comply with all safety,  fire  protection,  and  evacuation  procedures  and  regulations
established  by Landlord or any  governmental  agency.  Landlord  has the right to evacuate the Building in the
event of an emergency or  catastrophe.  Landlord  reserves the right to prevent access to the Building in cases
of invasion,  mob, riot,  bomb threat,  public  excitement or other commotion by closing the doors or by taking
other appropriate action.

23.      Tenant  assumes any and all  responsibility  for  protecting  the  Premises  from  theft,  robbery and
pilferage, which includes keeping doors locked when the Premises are not fully inhabited.

24.      Smoking shall not be permitted in the building.  Smoking is permitted  outside the building;  however,
smokers must utilize the ash urns which are located outside the building.

25.      Landlord has the right to designate a property  management  company to,  among other  things,  monitor
and enforce the Rules and Regulations.

26.      Tenant is solely  responsible  for the cost to maintain and repair any and all "Above  Standard" items
installed  within their  Premises  (i.e.,  computer  room air  conditioning  unit,  sinks,  garbage  disposals,
dishwashers, custom locking devices, specialty lighting, private restroom fixtures, etc.).

27.      Landlord  reserves the right to rescind any of these rules and  regulations and to make such other and
further rules and  regulations  as in its sole judgment  shall from time to time be required for the successful
and  professional  operation of the  Building,  which rules shall be binding upon each tenant and its officers,
agents, employees, guests and vendors upon delivery to tenant.






                                                         F-2

                                                                                                    Tenant Initials
                                                  EXHIBIT "F"
                                                  -----------

                                              GATEWAY OFFICE FOUR

                                            COMMENCEMENT MEMORANDUM


Frontier Airlines, Inc.

Re:      Commencement Memorandum

Dear                           :
     --------------------------

         With reference to that certain lease (the "Lease"),  dated December 15, 2000,  between  GATEWAY OFFICE
FOUR,  LLC, a Colorado  limited  liability  company  ("Landlord"),  and  Frontier  Airlines,  Inc.,  a Colorado
corporation  ("Tenant"),  you are  hereby  notified  of the  following.  All  capitalized  terms not  otherwise
defined herein shall have the same meaning as set forth in the Lease.

1.       By execution  hereof,  you  acknowledge  and agree that all  improvements or other work required of us
has been  satisfactorily  performed  and you hereby accept the Premises in full  compliance  with the terms and
conditions of the Lease.

2.       The Commencement Date of the Lease was                , and the Lease will expire at midnight
                                                ---------------                                        ------------
, 20      , if not extended or renewed or terminated earlier pursuant to the Lease.
    ------

3.       The Premises consist of               (          ) square feet of Rentable Area.
                                --------------  ----------

4.       The prorated  amount of Base Rent and  Additional  Rent for  Operating  Expenses for the partial month
of                       is $               and $                  , respectively.
- ------------------------     --------------      ------------------

5.       The  amount of Base Rent and  Additional  Rent for  Operating  Expenses  for the first  full  month is
$                       and $                    , respectively.
- -----------------------      --------------------

6.       On             , 20   , you deposited with us a security deposit in the amount of
           -------------    ---                                                            --------------------------------
 Dollars ($            ).
           ------------

7.       Pursuant to Exhibit "K" of the Lease,  you have under certain  conditions a restricted right to expand
the    Rentable    Area   of   the    Premises    to    thousand    (   )    square    feet    of    contiguous
                                                                     ---
rentable area adjacent to the Premises located on the                (          th) floor of the Building.
                                                     ---------------   ---------


         Except as may be amended  herein,  all terms and  conditions of the Lease shall continue in full force
and  effect  and are  hereby  republished,  ratified,  and  reaffirmed  in their  entirety.  This  Commencement
Memorandum  shall be binding  upon and may be relied  upon by the  parties  hereto and their  respective  legal
representatives, successors, and assigns.


                                                     Very truly yours,

                                                     GATEWAY OFFICE FOUR, LLC,
                                                     a Colorado limited liability company

                                                     By:      GATEWAY BUSINESS PARK, LLC, a
                                                              Colorado limited liability company,
                                                              its sole member
                                                              By:
                                                                 -----------------------------------------
                                                                       Paul Powers, President and
                                                                       Authorized Signatory


Acknowledged and agreed to
this        day of                      , 20    , by
    -------       ----------------------    ----
company, Member
Frontier Airlines, Inc., a Colorado corporation


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






                                                         G-1

                                                                                                    Tenant Initials
                                                  EXHIBIT "G"
                                                  -----------

                                              GATEWAY OFFICE FOUR

                                                   Reserved








                                                         H-3

                                                                                                    Tenant Initials
                                                  EXHIBIT "H"
                                                  -----------

                                              GATEWAY OFFICE FOUR

                                             ESTOPPEL CERTIFICATE

         With  reference to that certain lease (the "Lease") dated  December 15, 2000,  between  GATEWAY OFFICE
FOUR,  LLC, a  Colorado  limited  liability  company  ("Landlord")  and  Frontier  Airlines,  Inc.,  a Colorado
corporation  ("Tenant"),  you are  hereby  notified  of the  following.  All  capitalized  terms not  otherwise
defined herein shall have the same meaning as set forth in the Lease.

         The undersigned  Tenant  certifies as follows to Landlord,  its actual and  prospective  assignees and
lenders,  and all actual and  prospective  purchasers of the Building (each of whom is irrevocably  entitled to
rely on this Estoppel Certificate):

1.       A true,  correct,  and complete  copy of the Lease  (including  all riders,  attachments,  amendments,
and/or  exhibits  thereto) is attached to this  instrument as Attachment 1 and represents the entire  agreement
between  the  Landlord  and Tenant  relating to the  Premises.  There are no oral or other  written  agreements
between Landlord and Tenant relating to the Premises or the transaction contemplated by the Lease.

2.       Tenant has accepted  possession  of the Demised  Premises  under the Lease,  and the term of the Lease
commenced on                         , 20       and will expire on                  ,      .
             ------------------------    ------                   ------------------ ------

3.       By the terms of the Lease,  Tenant is presently  obligated to pay, without present right of defense or
offset,    monthly   base   rent   of   $   .   Additionally,    Tenant   is   to   reimburse    Landlord   for
                                         ---
______________________.  Tenant has no claim  against  Landlord for any rent paid more than thirty (30) days in
advance or any deposits or other sums other than                   .
                                                 ------------------

4.       Any  improvements  contemplated  by the Lease have been completed in their entirety in accordance with
the terms of the Lease, except for                         .
                                   ------------------------

5.       The address for notice to Tenant under the Lease is correct as of the date hereof.

6.       Tenant has no right of first  refusal,  option,  or other right to purchase  the  Premises or any part
thereof, including, without limitation, the Premises.

7.       The execution of the Lease was duly authorized by Tenant,  is in full force and effect,  and is valid,
binding,  and enforceable  against Tenant in accordance with its terms.  There exists no default,  nor state of
facts  which with  notice,  the  passage of time,  or both,  could  mature into a default on the part of either
Tenant or Landlord, except for                                                                            .
                               ----------------------------------------------------------------------------

8.       There  has not been  filed by or  against  nor,  to  Tenant's  best  knowledge  and  belief,  is there
threatened  against  or  contemplated  by  Tenant,  a petition  in  bankruptcy,  voluntary  or  otherwise,  any
assignment  for the  benefit of  creditors,  any  petition  seeking  reorganization  or  arrangement  under the
bankruptcy  laws of the United States or any state thereof,  or any other action brought under said  bankruptcy
laws.

9.       Tenant has obtained all necessary  governmental  licenses and permits required to lawfully conduct its
business at the Premises,  including,  but not limited to, business,  department of health, and safety licenses
or permits.

10.      Tenant has not  assigned or  otherwise  transferred  its  interest in the Lease to any party or sublet
any portion of the Premises.

11.      Pursuant  to the  Lease,  Tenant has  deposited  with  Landlord  a  security  deposit in the amount of
                                           Dollars ($             ).
- ------------------------------------------           -------------

12.      By the terms of the Lease,  Tenant has under certain  conditions a restricted  right of opportunity to
expand  the   Rentable   Area  of  the   Premises  to  thousand  (  )  square  feet  of   contiguous   rentable
area adjacent to the Premises located on the             (        th) floor of the Building.

         Except as may be amended  herein,  all terms and  conditions of the Lease shall continue in full force
and effect and are hereby republished,  ratified,  and reaffirmed in their entirety.  This Certificate shall be
binding  upon and may be  relied  upon by the  parties  hereto  and  their  respective  legal  representatives,
successors, and assigns.

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

LANDLORD:                                                     TENANT:

GATEWAY OFFICE FOUR, LLC,                   FRONTIER AIRLINES, INC.,
a Colorado limited liability company                          a Colorado corporation

By:    GATEWAY BUSINESS PARK, LLC, a                 By:
                                                        -----------------------------------------
       Colorado limited liability company,                    Print Name:
                                                                         ---------------------------------
       its sole member                                        Print Title:
                                                                          --------------------------------

         By:
            -----------------------------------------
              Paul Powers, President and
              Authorized Signatory



STATE OF                            )
         ---------------------------
                                    )       ss.
COUNTY OF                           )
          --------------------------

         This     instrument    was     acknowledged     before    me    on    ,    20    by    PAUL    POWERS,
                                                                                      ----
Authorized Signatory for GATEWAY OFFICE FOUR, LLC, a Colorado limited liability company.



                                                     (Signature of Notarial Officer)
(Seal, if any)                                       (My Commission Expires                      )
                                                                           ----------------------


STATE OF                            )
         ---------------------------
                                    )       ss.
COUNTY OF                           )
          --------------------------

         This instrument was acknowledged before me on                          , 20     by
                                                       -------------------------    ----    ----------------------------------------
 as                                          of                                                  .
    ----------------------------------------    -------------------------------------------------



                                                     (Signature of Notarial Officer)
         (Seal, if any)                              (My Commission Expires                      )
                                                                           ----------------------






                                                 ATTACHMENT 1
                                                 ------------
                                                TO EXHIBIT "H"
                                                --------------

                                              GATEWAY OFFICE FOUR


                                                LEASE AGREEMENT






                                                         I-3

                                                                                                    Tenant Initials
                                                  EXHIBIT "I"
                                                  -----------

                                              GATEWAY OFFICE FOUR

                           SUBORDINATION, NON-DISTURBANCE, AND ATTORNMENT AGREEMENT

         THIS  SUBORDINATION,  NON-DISTURBANCE,  AND  ATTORNMENT  AGREEMENT  (this  "Agreement")  is made  this
                 day of                              , 20       , by and among
- ----------------        -----------------------------    -------               ------------------------------------
 (collectively  with its  assignee(s),  "Lender"),  GATEWAY  OFFICE  FOUR,  LLC, a Colorado  limited  liability
- -
company ("Landlord"),  and FRONTIER AIRLINES,  INC., a Colorado corporation ("Tenant") with respect to (i) that
certain  Lease  Agreement  dated  December  15,  2000 (the  "Lease,"  and the  premises  subject  thereto,  the
"Premises")  made by and between  Landlord and Tenant;  and (ii) the loan or proposed loan (the "Loan") made or
to be made by Lender and secured or to be secured by a deed of trust and/or other security  instrument(s)  (the
"Deed of Trust") upon the real property which the Premises is situated on (the "Real Property").

         NOW, THEREFORE, the parties agree as follows:

1.       Subordination.  The  Lease,  all  renewals  or  modifications  thereto,  and  all of  Tenant's  rights
thereunder, shall be subordinate to the rights of the Lender under the Deed of Trust.

2.       Attornment.  Tenant shall attorn to and recognize  any purchaser at a foreclosure  sale under the Deed
of Trust,  any  transferee  who acquired the Real Property by deed in lieu of  foreclosure,  and the successors
and assigns of such purchaser,  as its landlord for the unexpired  balance (and any  extensions,  if exercised)
of the Lease, on the same terms and conditions as are set forth in the Lease.

3.       Non-Disturbance.  If it becomes  necessary to foreclose the Deed of Trust,  or if a purchaser or other
transferee  acquires the Real  Property in  accordance  with  Paragraph 2, the Lease shall remain in full force
and effect and  neither  Lender nor such other  transferee  shall  terminate  the Lease,  nor  interfere  with,
abridge,  or limit  Tenant's  use,  possession,  or  enjoyment  of the  Premises or any of Tenant's  rights and
privileges  under the Lease,  nor join Tenant in summary or  foreclosure  proceedings.  The preceding  sentence
shall  apply  only  so long as  Tenant  is not in  material  default  under  any of the  terms,  covenants,  or
conditions of the Lease beyond any applicable grace or cure period.

4.       Effects of Succession of Lender to Landlord's  Interest in the Real  Property.  If Lender  succeeds to
the  interest  of  Landlord  under the Lease,  Lender  shall not be: (i) liable for any act or  omission of any
prior landlord  (including  Landlord);  (ii) liable for the return of any security  deposit unless such deposit
has been  delivered  to Lender by Landlord or is in an escrow fund  available to Lender;  (iii)  subject to any
offsets or defenses that Tenant might have against any prior landlord (including  Landlord);  (iv) bound by any
rent or  additional  rent that  Tenant  might have paid for more than the current  month to any prior  landlord
(including  Landlord);  (v) bound by any  amendment,  modification,  or  termination  of the Lease made without
Lender's  consent;  or (vi) bound by any termination of the Lease given by Landlord to Tenant without  Lender's
prior  written  consent,  except for any option  originally  granted to Tenant in the Lease to terminate all or
any portion of the Lease.

5.       Payments  by Tenant  Upon  Landlord  Default.  Landlord  has agreed  under the Deed of Trust and other
documents  pertaining  to the Loan that  rentals  payable  under the Lease shall be paid  directly by Tenant to
Lender upon  default by Landlord  under the Deed of Trust.  After  receipt of notice from Lender to Tenant that
rentals  under the Lease shall be paid to Lender,  Tenant shall pay to Lender,  or at the  direction of Lender,
all  monies  due or to  become  due to  Landlord  under the  Lease.  Tenant  shall  have no  responsibility  to
ascertain  whether  such  demand by Lender  is  permitted  under  the Deed of  Trust,  or to  inquire  into the
existence of a default.  Landlord  hereby waives any right,  claim, or demand it may now have or hereafter have
against  Tenant by reason of such payment to Lender,  and any such payment shall  discharge  the  obligation of
Tenant to make such payment to Landlord,  and Tenant  shall make such  payment  notwithstanding  any claim from
Landlord that no default by Landlord  exists.  Lender shall defend,  indemnify,  and save Tenant  harmless from
any claims,  losses,  expenses, or liabilities  (including reasonable attorney fees and other costs of defense)
asserted by Landlord arising out of Tenant's complying with Lender's instructions under this Paragraph.

6.       Notice and Right to Cure to Lender of Defaults by Landlord  Under  Lease.  Tenant  shall give  Lender,
by certified  mail,  return receipt  requested,  or by commercial  overnight  delivery  service,  a copy of any
notice of default  Tenant  serves on Landlord.  If Landlord  shall have failed to cure such default  within the
time  provided for in the Lease,  then Lender shall have an  additional  ten (10) days within which to cure any
default  capable to being cured by the  payment of money and an  additional  thirty  (30) days within  which to
cure any other  default.  If such  default  cannot be cured  within  that  time,  then  Lender  shall have such
additional  time as may be  reasonably  and  commercially  necessary to cure such default if within such thirty
(30) days Lender has commenced and is diligently  pursuing remedies necessary to cure such default  (including,
but not limited to,  commencement  of foreclosure  proceedings,  if necessary),  in which event the Lease shall
not be terminated while such remedies are being diligently pursued.

7.       Successors  and  Assigns.  This  Agreement  shall be binding on and shall  inure to the benefit of the
parties hereto and their successors and assigns.

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

LENDER:


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

LANDLORD:                                                     TENANT:

GATEWAY OFFICE FOUR, LLC,                   FRONTIER AIRLINES, INC.,
a Colorado limited liability company                          a Colorado corporation

By:    GATEWAY BUSINESS PARK, LLC, a                 By:
                                                        -----------------------------------------
       Colorado limited liability company,                    Print Name:
                                                                         ---------------------------------
       its sole member                                        Print Title:
                                                                          --------------------------------

         By:
            -----------------------------------------
              Paul Powers, President and
              Authorized Signatory

STATE OF                            )
         ---------------------------
                                    )       ss.
COUNTY OF                           )
          --------------------------

         This instrument was acknowledged before me on                             by
                                                       ---------------------------    ----------------------------------------------
as                                  of                                  .
   --------------------------------    ---------------------------------



                                                     (Signature of Notarial Officer)
(Seal, if any)                                       (My Commission Expires                      )
                                                                           ----------------------










STATE OF                            )
         ---------------------------
                                    )       ss.
COUNTY OF                           )
          --------------------------

         This     instrument    was     acknowledged     before    me    on    ,    20    by    PAUL    POWERS,
                                                                                      ----
Authorized Signatory of GATEWAY OFFICE FOUR, LLC, a Colorado limited liability company.



                                                     (Signature of Notarial Officer)
(Seal, if any)                                       (My Commission Expires                      )
                                                                           ----------------------


STATE OF                            )
         ---------------------------
                                    )       ss.
COUNTY OF                           )
          --------------------------

         This instrument was acknowledged before me on                          by
                                                       ------------------------    ----------------------------------------
as                                   of                                         .
   ---------------------------------    ----------------------------------------



                                                     (Signature of Notarial Officer)
(Seal, if any)                                       (My Commission Expires                      )
                                                                            ---------------------






                                                         J-1

                                                                                                    Tenant Initials
                                                  EXHIBIT "J"
                                                  -----------

                                              GATEWAY OFFICE FOUR

                                                   Reserved





                                                         K-3

                                                                                                    Tenant Initials
                                                  EXHIBIT "K"
                                                  -----------

                                              GATEWAY OFFICE FOUR

                                             RIGHT OF FIRST OFFER

         THIS RIGHT OF FIRST  OFFER is attached  to the Lease  between  GATEWAY  OFFICE  FOUR,  LLC, a Colorado
limited liability company ("Landlord") and FRONTIER AIRLINES, INC., a Colorado corporation ("Tenant").

1.       Provided at least one year  remains on the Lease Term,  Tenant  shall have a right of first offer with
respect to any  contiguous  Rentable  Area  adjacent to the Premises  which become vacant during the Lease Term
(the "First  Offer  Space") as outlined  on  Attachment  1 to this  Exhibit of the Lease.  Notwithstanding  the
foregoing  (i) such first offer  right of Tenant  shall  commence  only  following  the  expiration  or earlier
termination of any existing lease  pertaining to each such  particular  First Offer Space,  and the first lease
pertaining  to  each  such  First  Offer  Space  entered  into  by  Landlord  after  the  date  of  this  Lease
(collectively,  the "Superior Leases"),  including any renewal of such existing or future lease, whether or not
such renewal is pursuant to an express  written  provision in such lease,  and  regardless  of whether any such
renewal is consummated  pursuant to a lease amendment or a new lease,  and (ii) such first offer right shall be
subordinate and secondary to all rights of expansion,  first refusal,  first offer or similar rights granted to
(1) other  tenants of the  Building  leasing  more  Rentable  Area in the  Building  than that leased to Tenant
hereunder,  or (2) the tenants of the Superior Leases (the rights  described in items (i) and (ii), above to be
known  collectively as "Superior  Rights").  Tenant's right of first offer shall be on the terms and conditions
set forth in this Exhibit "K."

2.       Landlord shall notify Tenant from time to time when Landlord  determines  that Landlord shall commence
the  marketing of any First Offer Space because such space shall become  available for lease to third  parties,
where no  holder of a  Superior  Right  desires  to lease  such  space.  Landlord  shall  notify  Tenant of the
availability  of and offer to lease to Tenant  First  Offer Space by delivery to Tenant of a notice (the "First
Offer Space Option Notice"),  which shall (i) describe the specific First Offer Space, (ii) contain  Landlord's
its determination of the amount of the fair market rent for such First Offer Space, which  determination  shall
be in the discretion of Landlord and shall be final,  (iii)  disclose the then existing  state of  improvements
and  condition  of such  space,  (iv)  specify  the length of the term which  Landlord is willing to lease such
First Offer Space,  and (v) set forth the approximate  date Tenant would be entitled to take possession of such
space.  Tenant  shall have ten (10)  business  days from  receipt of the First  Offer  Space  Option  Notice to
accept or reject the offer for all of such  space.  Tenant may  exercise  its right only as to all of any First
Offer Space  offered to Tenant and only on the terms and  conditions  set forth in the First Offer Space Option
Notice.  Any  attempt to exercise  its offer to less than all of any First Offer Space  offered to Tenant or on
terms or  conditions  other  than as set forth in the First  Offer  Space  Expansion  Notice  shall be null and
void.  If Tenant  accepts the offer,  such space shall  become part of the  Premises  and Tenant shall be bound
with  respect to such space by the terms and  conditions  of this  Lease,  as modified by the First Offer Space
Option Notice.  If Tenant does not notify  Landlord  within such ten (10) business days of Tenant's  acceptance
of the offer for all of such  space,  then  Landlord  shall  thereafter  have the right to lease such space not
taken by Tenant to other  persons on such terms and  conditions  as Landlord may elect;  provided,  that in the
event any of the  financial  terms set forth in the First Offer Space  Option  Notice are modified by more than
ten (10%)  percent  within a period of one hundred  twenty (120) days  subsequent  to the delivery of the First
Offer Space Option  Notice to Tenant,  or in the event that  Landlord has not entered into a lease with a third
party during such one hundred  twenty (120) day period,  then before  entering into a lease with a third party,
Landlord  shall  deliver a First Offer Space Option Notice to Tenant to afford Tenant  another  opportunity  to
evaluate  such  revised  terms or to  reconsider  its  desire to lease the First  Offer  Space on the terms and
conditions previously offered by Landlord to Tenant.

3.       If  Tenant  timely  exercises  Tenant's  right to lease  the First  Offer  Space as set forth  herein,
Landlord  and Tenant  shall  execute an  amendment  adding  such First  Offer Space to this Lease upon the same
non-economic  terms and  conditions  as  applicable  to the initial  Premises  (other than  Tenant's  Option to
Terminate,  which  shall not apply to Tenant's  lease of the First Offer  Space),  and the  economic  terms and
conditions  as provided in this Exhibit  "K."  Thereafter,  the total Base Rent payable  under this Lease shall
be the sum of the Base  Rent for all  First  Offer  Space  added to the  Premises  plus the Base  Rent  already
payable  under the Lease.  Tenant shall  commence  payment of Base Rent for the First Offer Space and the Lease
Term of the First Offer Space shall commence upon the date of delivery of such space to Tenant.

4.       Tenant  shall  accept all First Offer Space in its then  "as-is"  condition  as disclosed in the First
Offer Space Option  Notice and Landlord  shall not be required to perform any work or furnish any  materials in
order to prepare  such First  Offer  Space for  Tenant's  occupancy.  Tenant  shall be  entitled  to  construct
improvements  in the First Offer Space in  accordance  with the  provisions  of this Lease  including,  without
limitation, Exhibit "D" hereof.

5.       The rights set forth in this Exhibit "K," and Landlord's  obligations with respect  thereto,  shall be
personal to the original  Tenant and any assignee to which the original  Tenant's entire interest in this Lease
has been  assigned  pursuant to the Lease and may only be  exercised by the  original  Tenant or such  assignee
(but not any  subtenant or other person or entity).  The right of first offer  granted  herein shall  terminate
as to a  particular  First Offer  Space upon the  failure by Tenant to  exercise  its right of first offer with
respect  to such First  Offer  Space as offered by  Landlord.  Tenant  shall not have the right to lease  First
Offer  Space  if,  as of the date of the  attempted  exercise  of any right of first  offer by  Tenant,  or, at
Landlord's  option,  as of the  scheduled  date of delivery  of such First Offer Space to Tenant,  Tenant is in
default under this Lease after any applicable notice and cure periods.





                                                    ATTACHMENT 1
                                                    ------------
                                                TO EXHIBIT "K"
                                                --------------

                                              GATEWAY OFFICE FOUR


                                               FIRST OFFER SPACE

EX-99.1

                                                                      EXHIBIT 99.1


         FRONTIER AIRLINES FLEET TRANSITION DISCUSSION

Frontier Airlines, Inc. has embarked upon a program to replace its existing fleet of Boeing 737-200 and
737-300 aircraft with new Airbus A318 and A319 aircraft. The decision to change fleet types was made for many
reasons, including the availability of updated technology, operational advantages and cabin comfort (wider
cabin, wider seats with added amenities, more legroom). This report will summarize what we believe to be the
significant operational and financial ramifications of the Airbus transition.

Our existing fleet consists of 18 Boeing 737-300 aircraft and seven Boeing 737-200 aircraft.  These aircraft
are subject to operating leases with expiration dates ranging from April 2002 to May 2006.  Exiting these
aircraft according to our planned Airbus delivery schedule may require us to extend some leases and negotiate
shorter terms or subleases on others. While we believe we have some flexibility under current leases, the
analysis that follows does not include any additional expense we would incur if we are unable to redeliver or
sublease these aircraft upon favorable terms before their current lease expirations.

In March 2000 we entered into an agreement (subsequently amended) to purchase 12 Airbus A318 and A319
aircraft with delivery dates between May 2001 and September 2004.  The agreement also includes options to
purchase nine additional aircraft with delivery dates in 2003, 2004 and 2005 and additional options to
purchase eight more aircraft without currently assigned delivery dates.  As a complement to this purchase, in
April and May 2000, we entered into lease agreements to lease 15 new Airbus A319s and one new Airbus A318
with delivery dates between June 2001 and October 2004.

During the fiscal year ending March 31, 2002, we will take delivery of three purchased Airbus A319s (May,
August and September) and three leased A319s (June, September and February 2002).  As we do not anticipate
returning any of the Boeing aircraft to the lessors during fiscal year ending March 31, 2002, all six Airbus
aircraft should provide growth in the capacity of our system.  We expect our March 31, 2002 fiscal
year-over-year growth in available seat miles (ASMs) to be in excess of 22%, and we anticipate this growth
will be a result of adding frequencies to existing markets, as well as beginning service to new destinations.

Incident to our transition in fleet type, we will incur costs in excess of our normal operations.  Additional
pilots, mechanics and flight attendants will be necessary while we train employees in the operational
differences between the Boeing fleet and the Airbus fleet.  Simulator time for pilot training will be
provided by Airbus, at its expense, and accounting rules require that we treat this as a non-cash expense and
reduce the capitalized value of the aircraft.  We will incur travel expenses and other training costs as we
send our employees to training in Miami, Florida, and other locations.  A dedicated team of project managers
has been in place since April 2000 and will continue through the transition.  Other employees join the effort
on a part-time basis.  We are incurring costs of complying with Federal Aviation Administration regulations
for certification of the new fleet type and expect those costs to continue and to include proving runs for
the first Airbus aircraft delivered.  We will be establishing an inventory of spare parts over and above our
existing inventory of Boeing parts and will incur the interest and warehouse space rental associated with
that inventory.

We began incurring some of these fleet transition costs during fiscal year ending March 31, 2001, including
over $500,000 in expected costs for the quarter ending March 31, 2001.  We expect these costs to accelerate
as we approach the first Airbus delivery in May 2001.  We have previously estimated that these costs would
approach $6,000,000 per year over the next two fiscal years.  After further negotiations and planning, we
estimate that we have been able to reduce those expected costs to approximately $4,500,000 per year over the
next two fiscal years.  These costs remain subject to change as a result of changes in delivery schedules,
personnel needs and training costs, as well as other factors.

The operational benefits of the Airbus fleet will begin to impact our financial results as the new aircraft
enter scheduled service.  We expect that the first two A319s will enter service in June 2001.  Based on data
provided by the Airbus manufacturer, we expect the A319 to be 11% more fuel efficient than our current
fleet.  Using $1.00 per gallon into-plane fuel cost, the cost savings would be approximately $27,000 per
month, per aircraft.

We expect that maintenance costs on the new aircraft will be considerably lower than for  mature aircraft.
Aircraft parts that require replacement are often covered by warranties.  Additionally, we will not encounter
any of the annual heavy maintenance checks on Airbus aircraft during the fiscal year ending March 31, 2002.
We will begin to perform maintenance checks during the following fiscal year and we expect the first four
years of checks to be less expensive than the checks that we are currently performing on our older fleet of
Boeing aircraft.  It is difficult to predict the dollar value of savings in maintenance as it is influenced
by a number of factors, but we estimate that the maintenance savings may be in excess of $50,000 per month,
per aircraft during the aircraft's first year of service and in excess of $35,000 per month, per aircraft
during the second year.

We pay maintenance reserves to lessors on our current fleet to cover long-term maintenance events on the
airframe, engines and landing gear.  We will pay reserves to lessors under the Airbus leases at lower rates
than under our current Boeing leases.  We will also accumulate maintenance reserves as an accrued liability
for our purchased aircraft based on the expected cost of the future maintenance event divided by the expected
hours of usage prior to the maintenance event. We estimate that the difference between the reserve accruals
of the Boeing fleet and the Airbus fleet will result in a cost savings of approximately $35,000 per month,
per aircraft.

The reserves on purchased aircraft also provide a cash flow advantage over our current leased fleet.  The
monthly accrual (estimated to be approximately $60,000 per month, per aircraft) is a non-cash expense until
we actually perform the various maintenance events, which we expect to occur between years five and fifteen
of operation.  The reserves on leased Airbus aircraft are less than the reserves on our leased Boeing
aircraft and are capped at a level that we would expect to reach near the end of the third year of
operation.  At that point, we would continue to accrue reserves as a non-cash expense and we would expect
similar cash flow benefits would occur as with purchased aircraft.

The above operational savings are offset by increased costs for landing fees and higher ownership costs.  We
estimate that landing fees will be approximately $10,000 per month, per aircraft higher for the heavier
Airbus A319 than the current Boeing fleet.  Monthly rentals and anticipated ownership costs per aircraft
(depreciation and interest) are expected to be $30,000 per month greater for the A319 than for the current
Boeing fleet.  We believe that owning our aircraft will create tax savings as aircraft are depreciated using
an accelerated method over seven years for tax purposes while using an estimated 30-year life for book
purposes.  Deferred tax expense is accrued as a non-cash expense on the difference between the two methods of
depreciation.

The aggregate impact in the net savings of the new fleet (excluding cash flow benefits) is expected to
approximate one half of the expected transition costs in the fiscal year ending March 31, 2002 and to be
nearly double the transition costs in the following fiscal year.  The transition costs are expected to be
higher during the early part of the transition and the savings of the new fleet will accelerate as we take
delivery of the Airbus aircraft.  The table below summarizes our expected quarterly fleet transition costs
and operational benefits for the quarter ending March 31, 2001 and during the following two fiscal years:

Quarter Ending    New Fleet Savings Transition Costs          Net Impact
March 31, 2001                                       $ 530,000                  $ (530,000)
June 30, 2001                       $   20,000                1,690,000                 (1,670,000)
September 30, 2001                     450,000                1,210,000                 (   760,000)
December 31, 2001          1,150,000                    460,000                     690,000
March 31, 2002             1,200,000                    960,000                     240,000
June 30, 2002                       1,460,000                 1,010,000                     450,000
September 30, 2002                  1,840,000                 1,280,000                     560,000
December 31, 2002          2,320,000                 1,100,000                   1,220,000
March 31, 2003             2,950,000                    790,000                  2,160,000


As noted above, these estimated costs and savings remain subject to change as a result of timing of and ease
with which we are able to exit the Boeing aircraft, changes in delivery schedules and personnel needs and
training costs, as well as other factors, which may not be within our control.







Safe Harbor Statement

The foregoing discussion includes certain forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995. Forward-looking statements are inherently subject to risks,
uncertainties and changes in circumstances, including changes in economic, business, competitive and/or
regulatory factors, many of which cannot be predicted with accuracy and some of which might not even be
anticipated. Future events and actual results, financial and otherwise, could differ materially from those
set forth in or contemplated by the forward-looking statements. These risks and uncertainties include, but
are not limited to, those discussed in "Risk Factors" in our Form 10-K for the year ended March 31, 2000 and
other Company filings with the Securities and Exchange Commission.

Frontier Airlines, Inc. is under no obligation, and expressly disclaims any
obligation, to update or alter its forward-looking statements whether as a
result of new information, future events or otherwise.