Private Client Group
                                                        MERRILL LYNCH BUSINESS
                                                        FINANCIAL SERVICES INC.
                                                        222 North LaSalle Street
                                                        17th Floor
                                                        Chicago, Illinois 60601
                                                        (312) 499-3057
                                                        FAX: (312) 499-3256

                                                        October 18, 2002

[LOGO] MERRILL LYNCH


Sel-Leb Marketing, Inc.
495 River Street
Paterson, NJ 07524

          RE: LOAN DOCUMENTS AMENDMENT AND EXTENSION

Ladies and Gentlemen:

This Letter Agreement will serve to confirm certain  agreements of Merrill Lynch
Business  Financial   Services  Inc.  ("MLBFS")  and  Sel-Leb  Marketing,   Inc.
("Customer")  with  respect to: (i) that certain WCMA AND TERM LOAN AND SECURITY
AGREEMENT  DATED  NOVEMBER 24, 1998 between  MLBFS and Customer  (including  any
previous  amendments  and  extensions  thereof),  and (ii) all other  agreements
between  MLBFS  and  Customer  or any  party  who  has  guaranteed  or  provided
collateral for Customer's  obligations  to MLBFS (a  "Guarantor")  in connection
therewith  (collectively,  the "Loan Documents").  Capitalized terms used herein
and not defined herein shall have the meaning set forth in the Loan Documents.

Subject to the terms hereof,  effective as of the  "Effective  Date" (as defined
below), the Loan Documents are hereby amended as follows:

(a) The "Maturity Date" of the WCMA Line of Credit is hereby extended to October
31, 2003.

(b) The term  "Maximum  WCMA Line of Credit"  shall mean an amount  equal to the
lesser of: (A) 80% of  Customer's  Accounts and Chattel  Paper,  as shown on its
regular  books and records  (excluding  Accounts  over 90 days old,  directly or
indirectly due from any person or entity not domiciled in the United states,  or
from any shareholder,  officer or employee of Customer or any affiliated entity)
plus 50% of Customer's Inventory,  as shown on its regular books and records, up
to a  maximum  of  $2,750,000.00,  less the  aggregate  outstanding  balance  of
Customer's Term Loan dated June 6, 2002, or (B) $3,550,000.00.

(c) The "Line Fee" for the period ending October 31, 2003,  shall be $35,500.00.
Customer  hereby  authorizes  and  directs  MLBFS to charge  said amount to WCMA
Account No. 886-07E38 on or at any time after the Effective Date.

(d) Customer's "tangible net worth" shall at all times exceed $8,500,000.00. For
the purposes  hereof,  the term  "tangible net worth" shall mean  Customer's net
worth as shown on Customer's regular financial  statements  prepared in a manner
consistent  with the terms  hereof,  but  excluding  an amount equal to: (i) any
assets which are  ordinarily  classified  as  "intangible"  in  accordance  with
generally accepted accounting principles,  and (ii) any amounts now or hereafter
directly or indirectly owing to Customer by officers, shareholders or affiliates
of Customer.

<PAGE>


                                  MERRILL LYNCH BUSINESS FINANCIAL SERVICES INC.
Sel-Leb Marketing, Inc.
October 18, 2002
Page No. 2

Except as expressly  amended  hereby,  the Loan Documents shall continue in full
force and effect upon all of their terms and conditions.

By their execution of this Letter Agreement,  the below-named  Guarantors hereby
consent to the foregoing  modifications to the Loan Documents,  and hereby agree
that the  "Obligations"  under their  respective  Unconditional  Guaranty and/or
agreements  providing  collateral shall extend to and include the Obligations of
Customer under the Loan Documents, as amended hereby.

Customer  and said  Guarantors  acknowledge,  warrant  and  agree,  as a primary
inducement to MLBFS to enter into this Agreement,  that: (a) no Default or Event
of Default has occurred and is continuing under the Loan Documents;  (b) each of
the  warranties of Customer in the Loan Documents are true and correct as of the
date  hereof  and shall be  deemed  remade as of the date  hereof;  (c)  neither
Customer nor any of said  Guarantors  have any claim against MLBFS or any of its
affiliates  arising out of or in connection with the Loan Documents or any other
matter whatsoever;  and (d) neither Customer nor any of said Guarantors have any
defense to payment of any amounts owing,  or any right of  counterclaim  for any
reason under, the Loan Documents.

The obligations of MLBFS under this Letter  Agreement are subject to its receipt
(where applicable) and satisfaction with the following:

     (1) Current Accounts  Receivable Aging and Inventory Report dated within 15
         days of funding; and

     (2) 09/30/2002 Financial Statements, if funded after 11/15/2002.

Provided  that no Event of  Default,  or event  which with the giving of notice,
passage of time, or both, would constitute an Event of Default,  shall then have
occurred and be continuing  under the terms of the Loan  Documents,  and each of
the  conditions  specified  above shall have been met to our  satisfaction,  the
amendments and agreements in this Letter  Agreement will become effective on the
date (the "Effective  Date") upon which:  (a) Customer and the Guarantors  shall
have executed and returned the duplicate  copy of this Letter  Agreement and the
other  documents  enclosed  herewith;  and (b) an  officer  of MLBFS  shall have
reviewed and approved this Letter  Agreement  and such other  documents as being
consistent in all respects with the original internal authorization hereof.

Notwithstanding the foregoing, if Customer and the Guarantors do not execute and
return the  duplicate  copy of this Letter  Agreement  and said other  documents
within 14 days from the date hereof,  or if for any other reason (other than the
sole  fault of MLBFS) the  Effective  Date shall not occur  within  said  14-day
period,  then all of said amendments and agreements  will, at the sole option of
MLBFS, be void.

<PAGE>


                                  MERRILL LYNCH BUSINESS FINANCIAL SERVICES INC.
Sel-Leb Marketing, Inc.
October 18, 2002
Page No. 3

Very truly yours,

MERRILL LYNCH BUSINESS FINANCIAL SERVICES INC.

By: /s/ Kimberly D. Fedorski
   ----------------------------
        Kimberly D. Fedorski
        Senior Credit Manager

ACCEPTED:

SEL-LEB MARKETING, INC.

By: /s/ Hal Markowitz
   ----------------------------

Printed Name: Hal Markowitz
              -----------------

Title: Chairman
       ------------------------

APPROVED:

ALES SIGNATURE LTD.

By: /s/ Hal Markowitz
   ----------------------------

Printed Name: Hal Markowitz
              -----------------

Title: Chairman
       ------------------------