<PAGE>   1
                                                                   EXHIBIT 10.71

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                             PARTICIPATION AGREEMENT

                                      among

                            LAM RESEARCH CORPORATION,
                                   as Lessee,



                                SCOTIABANC INC.,
                                   as Lessor,

                            THE BANK OF NOVA SCOTIA,
            as a Rent Purchaser and as Agent for the Rent Purchasers


                          -----------------------------

                          Dated as of January 19, 2000

                          -----------------------------


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<PAGE>   2

                             PARTICIPATION AGREEMENT

        THIS PARTICIPATION AGREEMENT, dated as of January 19, 2000 (this
"Agreement"), is among LAM RESEARCH CORPORATION, a Delaware corporation (the
"Lessee"); SCOTIABANC INC., a Delaware corporation, as Lessor (the "Lessor"),
and THE BANK OF NOVA SCOTIA, as a Rent Purchaser (together with the other
financial institutions as may from time to time become Rent Purchasers, the
"Rent Purchasers") and as Agent for the Rent Purchasers (in such capacity, the
"Agent"). Capitalized terms used but not otherwise defined in this Agreement
shall have the meanings set forth in Annex A hereto.

                              PRELIMINARY STATEMENT

        In consideration of the mutual agreements herein contained and other
good and valuable consideration, receipt of which is hereby acknowledged, the
parties hereto hereby agree as follows:

                                        -
                                THE RENT PURCHASE

        The Rent Purchasers have agreed to purchase from the Lessor an interest
in the Lease Balance ("Rent Purchaser Advances") in an aggregate principal
amount of up to $23,942,935.39 in order for the Lessor to acquire the Land and
Improvements, and to pay other Project Costs. In consideration of the receipt of
the proceeds of such Rent Purchaser Advances, the Lessor does hereby absolutely
sell, assign, transfer and convey unto the Rent Purchasers all of the Lessor's
right, title and interest in and to the interests with respect to the Lease
Balance Debt; provided that this sale is without recourse to the Lessor (except
to the extent of its representations expressly set forth herein).

        The sale of the interests in the Lease Balance Debt herein is a
presently effective, absolute and unconditional assignment and transfer of such
interests. As a further inducement to the Rent Purchasers, the Lessor covenants
and agrees not to assert any claim or cause of action against the Rent
Purchasers or seek to recover such interests on the grounds that the agreement
in this Section 1 is a collateral assignment or is given as security for
indebtedness rather than as an absolute present assignment.

        The Rent Purchasers shall receive interest on the Rent Purchaser
Advances at the Lease Rate applicable to LIBOR Rent Purchaser Advances or ABR
Rent Purchaser Advances, as the case may be, and shall be entitled to the
benefits of the Pledge Agreement in accordance with their pro rata share of the
Lease Balance together with the Lessor.

        On the Funding Date, each Rent Purchaser shall make a payment in respect
of its purchase of the interest being funded by it on such date by making its
Rent Purchaser Advance available to the Agent prior to 12:00 noon New York time
by wire transfer in

                                       1.
<PAGE>   3

immediately available funds at the account of the Agent at its payment office as
set forth on SCHEDULE 2.6, or at such other account as to which the Agent shall
notify such Rent Purchaser in writing, and the Agent shall forward such amounts
to the Lessor's account at its payment office as set forth on SCHEDULE 2.6, or
such other account as the Lessor may specify in writing, not later than 2:00
p.m. New York time on the same date. In the event a Rent Purchaser shall fail to
make available to the Agent the full amount of such Rent Purchaser Advance by
12:00 noon New York time and unless Agent receives notice from such Rent
Purchaser that it will not make available its pro rata share of the Rent
Purchaser Advance, the Agent may (but shall not be required to) fund such Rent
Purchaser Advance, and the amount of the Rent Purchaser Advance so funded shall
be for the account of such Rent Purchaser. Such Rent Purchaser shall pay to the
Agent on demand the amount of such Advance with interest thereon at a rate equal
to the average federal funds rate for the period from the Funding Date to the
date on which such Rent Purchaser makes such Advance available to the Agent in
immediately available funds at the account referenced above. If such Rent
Purchaser does not make such advance available to the Agent within three (3)
Business Days after the Funding Date, the Agent shall be entitled to recover
such advance with interest thereon at the Overdue Rate, on demand, from the Rent
Purchaser.

        Upon the request of a Rent Purchaser, the Lessor agrees that it will
cause a Uniform Commercial Code financing statement or statements covering all
the interests sold to such Rent Purchaser pursuant to this Agreement to be
executed and delivered by the Lessor, as debtor, specifying such Rent Purchaser
as secured party, and such financing statement or statements will be duly filed
in all places necessary to perfect the sale of the interests sold to such Rent
Purchaser pursuant to this Agreement, and all filing and recordation fees
payable in connection therewith will be paid by such Rent Purchaser. Such
financing statements shall state that they are being filed to perfect a sale of
such interests, and that no inference that a security interest has been granted
to such Rent Purchaser shall be made as a result of such filing.

                                        -
                              LESSOR CONTRIBUTIONS

    -   LESSOR CONTRIBUTIONS. Subject to the terms and conditions of this
        Agreement, and in reliance on the representations and warranties of each
        of the parties hereto contained herein or made pursuant hereto, on the
        Funding Date the Lessor shall contribute ("Lessor Contribution") an
        amount equal to the Lessor's Commitment Percentage of the amount of the
        aggregate Advance requested by the Lessee prior to the Funding Date. The
        aggregate amount of the Lessor Contribution made by the Lessor shall not
        exceed the Lessor Commitment as set forth in SCHEDULE 2.1 hereto.
        Notwithstanding any other provision hereof, the Lessor shall not be
        obligated to make any Advance if, after giving effect thereto, (i) the
        aggregate outstanding amounts of the Rent Purchaser Advances and the
        Lessor Contribution would exceed the Aggregate Commitment Amount, or
        (ii) the Lease Balance would exceed the lesser of (x) 110 percent of the
        Project Costs and (y) the

                                       2.
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        Fair Market Sales Value of the Property as set forth in the Appraisal of
        the Property delivered pursuant to Section 6.2 hereof. Notwithstanding
        any other provision hereof, Lessor shall not be obligated to make
        available the Lessor Contribution if, after giving effect to the
        proposed Lessor Contribution, the outstanding aggregate amount of the
        Lessor Contribution would exceed the Lessor Commitment. The Lessor shall
        use the Lessor Contribution to pay a portion of the Project Costs
        simultaneously and pro rata with the fundings by the Rent Purchasers.

    -   YIELD.

    -   The amount of outstanding Rent Purchaser Advances shall accrue interest
        as set forth in SECTION 1 hereof. The amount of Lessor contributions
        outstanding from time to time shall accrue yield at the Lease Rate
        applicable to LIBOR Lessor Contributions or ABR Lessor Contributions, as
        the case may be. Such interest and yield are referred to collectively
        herein as "Yield".

    -   Yield shall be calculated using the actual number of days elapsed and on
        , when the Lease Rate is based on the Adjusted LIBOR, a 360-day year
        basis and, if calculated at the ABR, a 360-day year basis if the ABR is
        calculated at the Federal Funds Effective Rate, and a 365-, or, if
        applicable, 366-, day year basis if the ABR is calculated at the Base
        Rate. If all or any portion of the Lease Balance, any interest or Yield
        payable thereon or any other amount payable hereunder shall not be paid
        when due (whether at stated maturity, acceleration thereof or
        otherwise), such overdue amount shall bear interest at a rate per annum
        which is equal to the Overdue Rate. Upon the occurrence, and during the
        continuance of an Event of Default, the amount of and, to the extent
        permitted by law, interest on (or Yield on) the Lease Balance and any
        other amounts owing hereunder or under the other Operative Agreements
        shall bear interest, payable on demand, at a per annum rate which is
        equal to the Overdue Rate.

    -   The Lessor shall distribute, in accordance with Section 12.1, the Lessor
        Basic Rent, the Debt Basic Rent and all other amounts due with respect
        to the Lessor Contribution and Rent Purchaser Advances paid to the
        Lessor by the Lessee under the Lease or the other Operative Agreements
        from time to time.

    -   Yield on the outstanding Lessor Contribution and Rent Purchaser Advances
        shall be due and payable by the Lessee in cash on each Specified
        Interest Payment Date.

    -   If not repaid sooner, the outstanding aggregate Lessor Contribution and
        Rent Purchaser Advances shall be repaid in full on the Maturity Date.

    -   INTEREST PERIOD SELECTION ELECTIONS. By delivering an Interest Period
        Selection Notice to the Lessor with respect to the Lessor Contribution
        and to the Agent with respect to Rent Purchaser Advances, respectively,
        the Lessee may from time to time during the Term irrevocably select, on
        not less than three (3) nor more than five (5) Business Days' notice
        (other than the initial Interest Period with respect to the Advance to
        be made on the Funding Date, where such Advance is to bear interest at a
        rate equal to the ABR and notice may be given on the Funding Date), the
        duration for the next succeeding Interest Period; provided, however,
        that (a) in the absence of a delivery of an Interest Period

                                       3.
<PAGE>   5

        Selection Notice with respect to any Rent Purchaser Advance or Lessor
        Contribution at least three (3) Business Days before the last day of the
        then current Interest Period with respect thereto, the Lessee shall be
        deemed to have selected a one (1) month Interest Period for such Rent
        Purchaser Advance or Lessor Contribution, (b) each such selection shall
        be prorated among the applicable outstanding Rent Purchaser Advances and
        Lessor Contribution of all Participants, and (c) the outstanding Rent
        Purchaser Advances and Lessor Contribution may not be apportioned into
        more than five (5) separate Interest Periods pursuant to this Section
        2.3 at any one time.


    -   PREPAYMENTS.

    -   VOLUNTARY PREPAYMENTS. The Lessee shall have the right to prepay an
        amount equal to the aggregate outstanding Lease Balance in whole, but
        not in part, pursuant to the exercise of the purchase options permitted
        under the Lease without premium or penalty, except for any payments due
        pursuant to Section 11.6 below.

    -   MANDATORY PREPAYMENTS.

    -   If at any time the sum of the aggregate amount of outstanding Rent
        Purchaser Advances and Lessor Contribution shall exceed the Aggregate
        Commitment Amount, the Lessee shall immediately make payment on the Rent
        Purchaser Advances or Lessor Contribution in an amount sufficient to
        eliminate such excess. Payments required to be made hereunder shall be
        applied first to ABR Rent Purchaser Advances or ABR Lessor Contributions
        and second to LIBOR Rent Purchaser Advances or LIBOR Lessor
        Contributions in direct order of their Interest Period maturities.

        All amounts payable by the Lessee pursuant to Article 15, 16, 17, 20 or
        21 of the Lease shall be applied to the Rent Purchaser Advances and the
        Lessor Contribution in the manner set forth in Section 12.

    -   NOTICE. The Lessee will provide irrevocable notice to the Lessor and the
        Agent of any prepayment of the Lessor Contribution or Rent Purchaser
        Advances at least three (3) Business Days prior to the date of
        prepayment.

    -   FEES. The Lessee agrees to pay to the Lessor, the Agent and the Rent
        Purchasers fees in accordance with the Fee Letter.

    -   PAYMENTS. All payments (including prepayments) to be made by the Lessee
        hereunder and under the Lease, whether on account of the Lessor
        Contribution, Rent Purchaser Advances or Yield or interest thereon or
        otherwise, shall be made without setoff or counterclaim and shall be
        made prior to 10:00 a.m., San Francisco time, on the due date thereof to
        the Lessor for the account of the Rent Purchasers and the Lessor, at the

                                       4.
<PAGE>   6

        Lessor's office specified in SCHEDULE 2.6 hereto, in Dollars and in
        immediately available funds.

                                        -
                           SUMMARY OF THE TRANSACTIONS

    -   OPERATIVE AGREEMENTS. On the Closing Date, each of the respective
        parties thereto shall execute and deliver this Agreement, the Lease, the
        Pledge Agreement and such other documents, instruments, certificates and
        opinions of counsel as are required by the terms hereof or agreed to by
        the parties hereto.

    -   PROPERTY ACQUISITION AND LEASE. On the Funding Date and subject to the
        terms and conditions of this Agreement, (a) the Lessor will make the
        Lessor Contribution in accordance with Section 2 hereof, (b) the Rent
        Purchasers will make Rent Purchaser Advances in accordance with Section
        5 hereof, (c) the Lessor will acquire the Land and the Improvements, and
        (d) the Lessor will simultaneously lease all of its right, title and
        interest in the Property to the Lessee.

                                       -
                                  THE CLOSING

        All documents and instruments required to be delivered on the Closing
Date shall be delivered at the offices of Cooley Godward LLP, 5 Palo Alto
Square, 3000 El Camino Real, Palo Alto, CA 94306, or at such other location as
may be determined by the Lessor and the Lessee.

                                        -
                               FUNDING OF ADVANCES

    -   GENERAL. To the extent funds have been made available to or advanced by
        the Lessor as Rent Purchaser Advances and the Lessor Contribution, the
        Lessor will make advances of such funds in accordance with the terms and
        conditions of this Agreement and the other Operative Agreements in order
        to provide sufficient funds to: (i) allow the Lessor, at the direction
        of the Lessee, to acquire the Land and the Improvements in accordance
        with the terms of this Agreement and the other Operative Agreements;
        (ii) allow the Lessor, on behalf of the Lessee, to pay Transaction
        Expenses; and (iii) pay all other Project Costs.

    -   PROCEDURES FOR FUNDING.

    -   Not less than three (3) Business Days prior to the proposed Funding Date
        (other than the Advance to be made on the Funding Date, where such
        Advance is to bear interest at a rate equal to the ABR and notice may be
        given on the Funding Date), the Lessee shall deliver to the Lessor and
        the Agent, a request for Advance and an Interest Period Selection
        Notice.

    -   So long as no Default or Event of Default has occurred and is continuing
        and subject to the Lessor and the Agent having each received the
        materials required by Section 6.2 on

                                       5.
<PAGE>   7

        the Funding Date (i) the Rent Purchasers shall make Rent Purchaser
        Advances to the Lessor in an aggregate amount equal to eighty-eight and
        two tenths percent (88.20%) of the funds requested up to an aggregate
        principal amount equal to the Available Rent Purchaser Commitments; (ii)
        the Lessor shall make the Lessor Contribution in an amount equal to
        eleven and eight tenths percent (11.8%) of the funds requested, up to an
        amount equal to the Available Lessor Commitment; and (iii) the total
        amount of such Rent Purchaser Advances and the Lessor Contribution shall
        be paid to the Lessor to pay the Project Costs.

    -   ALLOCATION OF ADVANCES BETWEEN LAND AND IMPROVEMENTS. In the event the
        Fair Market Sales Value of the Land leased pursuant to the Lease as set
        forth in the Appraisal is greater than twenty-five percent of the
        aggregate Fair Market Sales Value of the Property as set forth in the
        Appraisal, Lessor shall determine a separate Land Investment Balance and
        Improvements Investment Balance for the Property and the same as of the
        Closing Date shall be set forth in Exhibit B to the Lease, and Lessee
        shall execute and deliver a separate Lease Supplement for each of the
        Land and the Improvements.


    -   PLEDGED COLLATERAL.

    -   MANDATORY PLEDGED COLLATERAL. If as of the last day of any Fiscal
        Quarter (i) the Lessee's EBITDA equals an amount less than (x) through
        the Fiscal Quarter ending December 31, 1999, $92,000,000, (y) from
        January 1, 2000 through March 31, 2000, $167,000,000, and (z)
        thereafter, $200,000,000, or (ii) the Lessee's Cash Balance equals an
        amount less than $200,000,000, provided, that if as of the date six (6)
        months prior to the Maturity Date, the Lessee has not refinanced the
        Subordinated Notes, there shall be deducted from the Cash Balance at all
        times thereafter the principal amount of such outstanding Subordinated
        Notes in determining the Cash Balance under this clause (ii), then (x)
        in the case of clause (i), on or before the third Business Day (or if
        such date is not a Business Day, the next succeeding Business Day) (the
        "Deposit Date") following the date on which financial statements are
        delivered pursuant to Section 9.3(a)(i) or (ii) hereof until the third
        Business Day following the date on which financial statements are
        delivered pursuant to Section 9.3(a)(i) or (ii) hereof for the Fiscal
        Quarter when the Lessee shall satisfy such tests, and (y) in the case of
        clause (ii), on such specified date (also, a "Deposit Date") for so long
        as any Obligations remain outstanding or until the third Business Day
        following the date on which financial statements are delivered pursuant
        to Section 9.3(a)(i) or (ii) hereof for the second consecutive Fiscal
        Quarter when the Lessee shall satisfy such tests, the Lessee shall
        deliver Pledged Collateral to the Collateral Agent in an amount equal to
        100% of the aggregate outstanding Advances plus $300,000. Thereafter,
        the Lessee covenants to maintain the Value of the Pledged Collateral at
        a level equal to 100% of the aggregate outstanding Advances plus
        $300,000, and within two (2) Business Days after receipt of notice from
        the Collateral Agent that the Value of the Pledged Collateral is less
        than 100% of the aggregate outstanding Advances plus $300,000, the
        Lessee shall be obligated to deliver a portion of the Pledged Collateral
        in an amount required to maintain the Value of the Pledged Collateral at
        a level equal to 100% of the aggregate outstanding Advances plus
        $300,000. Each such deposit (collectively, the "Pledge") shall be the


                                       6.
<PAGE>   8

        property of the Collateral Agent and shall be held and administered in
        accordance with the Pledge Agreement.

    -   OPTIONAL PLEDGED COLLATERAL. Notwithstanding the requirements of Section
        5.4(a), from time to time, the Lessee may make a deposit of additional
        Pledged Collateral to the Collateral Agent in an amount equal to not
        less than 100% of the aggregate outstanding Advances in order to have a
        lower Applicable Margin apply to the outstanding Advances. In order to
        maintain a lower Applicable Margin, the Lessee covenants to maintain the
        Value of the Pledged Collateral at a level equal to 100% of the
        aggregate outstanding Advances, and within two (2) Business Days after
        receipt of notice from the Collateral Agent that the Value of the
        Pledged Collateral is less than 100% of the aggregate outstanding
        Advances, the Lessee shall deliver a portion of Pledged Collateral in an
        amount required to maintain the Value of the Pledged Collateral at a
        level equal to 100% of the aggregate outstanding Advances. Each such
        deposit shall constitute part of the Pledge, shall be the property of
        the Collateral Agent and shall be held and administered in accordance
        with the Pledge Agreement.



                                        -
                     CONDITIONS OF THE CLOSING AND ADVANCES

    -   GENERAL CONDITIONS TO THE CLOSING DATE. The Closing Date is subject to
        the satisfaction, immediately prior to or concurrently therewith, of the
        following conditions precedent:

    -   OPERATIVE AGREEMENTS. Each of the Operative Agreements entered into on
        the Closing Date or subsequently shall have been duly authorized,
        executed, acknowledged and delivered by the parties thereto and shall be
        in full force and effect, and no Default shall exist thereunder (both
        before and after giving effect to the transactions contemplated by the
        Operative Agreements), and the Rent Purchasers and the Lessor shall have
        received a fully executed copy of each of the Operative Agreements.

    -   TAXES. All taxes, fees and other charges in connection with the
        execution, delivery, and, where applicable, recording, filing and
        registration of the Operative Agreements shall have been paid or
        provisions for such payment shall have been made to the reasonable
        satisfaction of the Agent and the Lessor.

    -   GOVERNMENTAL APPROVALS. All necessary (or, in the reasonable opinion of
        the Agent, the Lessor and their respective counsel, advisable)
        Governmental Actions shall have been obtained or made and be in full
        force and effect.

    -   LITIGATION. No action or proceeding shall have been instituted before
        any Governmental Authority, nor shall any order, judgment or decree have
        been issued or proposed to be issued by any Governmental Authority (i)
        to set aside, restrain, enjoin or prevent the full

                                       7.
<PAGE>   9

        performance of this Agreement, any other Operative Agreement or any of
        the transactions contemplated hereby or thereby or (ii) other than as
        set forth on Schedule 7.2, which is reasonably likely to have a Material
        Adverse Effect.

    -   LEGAL REQUIREMENTS. In the opinion of the Agent, the Lessor and their
        respective counsel, the transactions contemplated by the Operative
        Agreements do not and will not violate in any material respect any Legal
        Requirements and do not and will not subject the Rent Purchasers or the
        Lessor to any adverse regulatory prohibitions or constraints.

    -   CORPORATE PROCEEDINGS OF THE LESSEE. The Agent and the Lessor shall have
        received a copy of the resolutions or minutes, in form and substance
        reasonably satisfactory to the Agent and the Lessor, of the Board of
        Directors of the Lessee authorizing the execution, delivery and
        performance of this Agreement and the other Operative Agreements to
        which it is a party, certified by the Secretary or an Assistant
        Secretary of the Lessee as of the Closing Date, which certificate shall
        be in form and substance reasonably satisfactory to the Agent and the
        Lessor and shall state that the resolutions or minutes thereby certified
        have not been amended, modified, revoked or rescinded.

    -   LESSEE INCUMBENCY CERTIFICATE. The Agent and the Lessor shall have
        received a certificate of the Lessee, dated the Closing Date, as to the
        incumbency and signature of the officers of the Lessee executing any
        Operative Agreement reasonably satisfactory in form and substance to the
        Agent and the Lessor, executed by the Secretary or any Assistant
        Secretary of the Lessee.

    -   LESSEE'S OFFICER'S CERTIFICATE. The Agent and the Lessor shall each have
        received a Certificate of the President or any Vice President of the
        Lessee, dated as of the Closing Date, stating that (i) each and every
        representation and warranty of the Lessee contained in the Operative
        Agreements to which it is a party is true and correct on and as of the
        Closing Date; (ii) no Default or Event of Default has occurred and is
        continuing under any Operative Agreement; (iii) each Operative Agreement
        to which the Lessee is a party is in full force and effect with respect
        to it; and (iv) the Lessee has duly performed and complied with all
        covenants, agreements and conditions contained herein or in any
        Operative Agreement required to be performed or complied with by it on
        or prior to the Closing Date.

    -   GOOD STANDING. The Agent and the Lessor shall have received (i)
        Certificates of the Secretaries of State of the State of Delaware and
        the State of California dated as of a recent date stating that the
        Lessee is a corporation in good legal standing under the laws of such
        states, and (ii) Certificates of the Franchise Tax Boards of the State
        of Delaware and the State of California dated as of a recent date
        stating that the Lessee is in good standing under the laws of such
        states.

    -   LESSEE'S CORPORATE DOCUMENTS. The Agent and the Lessor shall have
        received true and complete copies of the certificate or articles of
        incorporation and by-laws of the Lessee, certified as of the Closing
        Date as complete and correct copies thereof by the Secretary or an
        Assistant Secretary of the Lessee.

                                       8.
<PAGE>   10

    -   CONSENTS, LICENSES AND APPROVALS. The Agent and the Lessor shall have
        received a certificate of the President or a Vice President of the
        Lessee stating that any consents, licenses and filings required to
        consummate the transaction contemplated by this Agreement are in full
        force and effect, and each such consent, authorization and filing shall
        be in form and substance reasonably satisfactory to the Agent and the
        Lessor.

    -   LEGAL OPINION. The Agent and the Lessor shall have received the executed
        legal opinion of Heller Ehrman White & McAuliffe, special counsel to the
        Lessee.

    -   ENVIRONMENTAL AUDIT.

           -   The Lessor and the Agent shall have received not less than ten
               (10) days prior to the Funding Date an Environmental Audit with
               respect to the Land being acquired on the Funding Date, prepared
               by the Environmental Engineer, and the results of the
               Environmental Audit shall be in form and substance satisfactory
               to the Lessor and the Agent; and

    -   the Lessor and the Agent shall have received letters from the
        Environmental Engineer stating, among other things, that the Rent
        Purchasers and the Lessor may rely in all respects on the Environmental
        Audit and other environmental reports with respect to the Property which
        have been prepared by such firm as if they were addressed to them.

    -   SURVEY. The Lessor and the Agent shall have received, and the Title
        Company shall have received, a survey of the Property being acquired on
        the Funding Date, certified to the Lessor and the Title Company in a
        manner satisfactory to them, dated as of a date within three (3) months
        of the Funding Date, by an independent professionally licensed land
        surveyor satisfactory to the Lessor, which survey shall be made in
        accordance with the Minimum Standard Detail Requirements for Land Title
        Surveys jointly established and adopted by the American Land Title
        Association and the American Congress on Surveying and Mapping in 1992,
        and, without limiting the generality of the foregoing, there shall be
        surveyed and shown on such survey the following: (i) the locations on
        such Property of all the buildings, structures and other improvements,
        if any, and the established building setback lines; (ii) the lines of
        streets abutting such Property; (iii) all access and other easements
        appurtenant to such Property; (iv) all roadways, paths, driveways,
        easements, encroachments and overhanging projections and similar
        encumbrances affecting such Property, whether recorded, apparent from a
        physical inspection of the Property or otherwise known to the surveyor;
        (v) any encroachments on any adjoining property by the building,
        structures and improvements on such Property; and (vi) if such Property
        is described as being on a filed map, a legend relating the survey to
        said map.

    -   APPRAISAL. The Lessor and the Agent shall have received an Appraisal of
        the Property, which Appraisal shall show as of the Funding Date the Fair
        Market Sales Value of the Property, and meet the other applicable
        requirements set forth in the definition of the term "Appraisal"
        contained in Annex A.

    -   LIEN SEARCHES. The Lessor and the Agent shall have received the results
        of a recent search by a Person reasonably satisfactory to the Lessor and
        the Agent, of the Uniform

                                       9.
<PAGE>   11

        Commercial Code, judgement and tax lien filings which may have been
        filed in State of California with respect to personal property of the
        Lessee, and the results of such search shall be satisfactory to the
        Lessor and the Agent.

    -   REPRESENTATIONS. The representations and warranties of the Lessee and
        the Lessor contained herein and in each of the other Operative
        Agreements shall be true and correct.

    -   PERFORMANCE OF AGREEMENTS. The parties hereto and thereto shall have
        performed their respective agreements to be performed on or prior to the
        Closing Date contained herein and in the other Operative Agreements on
        or prior to the Closing Date.

    -   FEES. The Lessor and the Agent and the Rent Purchasers shall have
        received the fees pursuant to the Fee Letter.

    -   CONDITIONS TO RENT PURCHASERS' AND LESSOR'S OBLIGATIONS TO MAKE RENT
        PURCHASER ADVANCES AND LESSOR CONTRIBUTIONS. The agreement of each Rent
        Purchaser to make the Rent Purchaser Advance to the Lessor, and of the
        Lessor to make the Lessor Contribution is further subject to the
        satisfaction, immediately prior to or concurrently with the making of
        such Rent Purchaser Advances and Lessor Contribution, of the following
        conditions precedent:

    -   TITLE. Title to the Property being acquired on the Funding Date shall
        conform to the representations and warranties set forth in Section
        7.2(w).

    -   TITLE POLICY. The Lessor shall have received an owner's title policy, or
        marked up unconditional binder for such insurance, dated the Funding
        Date, for the Property being acquired on the Funding Date, insuring the
        Lessor that the Lien of the Lease is a first and primary Lien in the
        Lessee's interest in the Improvements and the Land; and the Lessor shall
        have received evidence reasonably satisfactory to it that all premiums
        in respect of such policy have been paid or provision made therefor.

    -   TITLE DOCUMENTS. The Lessor shall have received a copy of all recorded
        documents referred to, or listed as exceptions to title in, the title
        policy referred to above.

    -   INSURANCE. The Lessor and the Agent shall have received evidence in form
        and substance satisfactory to them that all of the requirements of
        Article 14 of the Lease shall have been satisfied.

    -   LEASE. The Lessor and the Agent shall have received the Lease
        Supplement, executed by the Lessee, and assuming proper recordation of
        the Memorandum of Lease, the Lease shall constitute a valid and
        perfected first lien on the Property and the Improvements, subject only
        to Permitted Exceptions.

    -   ACTIONS TO PERFECT LIENS. The Lessor shall have received evidence in
        form and substance satisfactory to it that all filings, recordings,
        registrations and other actions, including, without limitation, the
        filing of duly executed financing statements on form

                                      10.
<PAGE>   12

        UCC-1, necessary or, in the opinion of the Lessor and the Agent,
        desirable to perfect the Liens created by the Security Documents shall
        have been completed.

    -   BRINGDOWN CERTIFICATE. The Lessor and the Agent shall have received an
        Officer's Certificate on behalf of the Lessee dated as of the Funding
        Date stating that (i) the representations and warranties of the Lessee
        contained herein and in each of the other Operative Agreements are true
        and correct in all material respects as of the Funding Date as though
        made as of the Funding Date, and (ii) no Default or Event of Default has
        occurred and is continuing.

    -   PERFORMANCE OF AGREEMENTS. The parties hereto and thereto shall have
        performed their respective agreements contained herein and in the other
        Operative Agreements on or prior to such Funding Date.

                                        -
                         REPRESENTATIONS AND WARRANTIES

    -   REPRESENTATIONS AND WARRANTIES OF THE LESSOR ON THE CLOSING DATE. The
        Lessor represents and warrants to each of the other parties hereto as of
        the Closing Date as follows:

    -   DUE ORGANIZATION, ETC. It is a duly organized and validly existing
        corporation in good standing under the laws of the jurisdiction of its
        organization and has the power and authority to carry on its business as
        now conducted and to enter into and perform its obligations under this
        Agreement, each Operative Agreement to which it is a party and each
        other agreement, instrument and document executed and delivered by it on
        the Closing Date in connection with or as contemplated by each such
        Operative Agreement to which it is or will be a party.

    -   AUTHORIZATION; NO CONFLICT. The execution, delivery and performance of
        each Operative Agreement to which it is a party have been duly
        authorized by all necessary action on its part and neither the execution
        and delivery thereof by the Lessor, nor the consummation of the
        transactions contemplated thereby by the Lessor, nor compliance by it
        with any of the terms and provisions thereof (i) requires or will
        require any approval of (which approval has not been obtained) the
        shareholders of, or approval or consent of any trustee or holders of any
        indebtedness or obligations of the Lessor, (ii) contravenes or will
        contravene any Legal Requirement applicable to or binding on it as of
        the date hereof, (iii) does or will contravene or result in any breach
        of or constitute any default under its articles of incorporation or
        by-laws or equivalent documents, or result in the creation of any Lessor
        Lien upon the Property or any part thereof, or (iv) does or will require
        any Governmental Action by any Governmental Authority.

    -   ENFORCEABILITY, ETC. Each Operative Agreement to which it is a party has
        been duly executed and delivered by it and constitutes a legal, valid
        and binding obligation enforceable against it in accordance with the
        terms thereof, subject, in each case, as to enforceability, bankruptcy,
        insolvency, reorganization and other similar laws affecting enforcement
        of creditor rights generally (insofar as any such law relates to the
        bankruptcy, insolvency, reorganization or similar event of the Lessor)
        and, as to the

                                      11.
<PAGE>   13

        availability of specific performance or other injunctive relief, subject
        to the discretionary power of a court to deny such relief and to general
        equitable principles.

    -   ERISA. The Lessor is making the Lessor Contribution contemplated to be
        made by it hereunder for its own account and with its general corporate
        assets in the ordinary course of its business, and no part of such
        amount constitutes the assets of any Employee Benefit Plan.

    -   LITIGATION. No litigation, investigation or proceeding of or before any
        arbitrator or Governmental Authority is pending or threatened by or
        against the Lessor (a) with respect to any of the Operative Agreements
        or any of the transactions contemplated hereby or thereby, or (b) which
        could reasonably be expected to have a material adverse effect on the
        assets, liabilities, operations, business or financial condition of the
        Lessor.

    -   ASSIGNMENT. It has not assigned or transferred any of its right, title
        or interest in or under the Lease, any Operative Document or the
        Property, except in accordance with the other Operative Agreements.

    -   NO DEFAULT. The Lessor is not in default under or with respect to any of
        its Contractual Obligations in any respect which could have a material
        adverse effect on the assets, liabilities, operations, business or
        financial condition of the Lessor. No Default or Event of Default
        attributable to it has occurred and is continuing.

    -   USE OF PROCEEDS. The proceeds of the Rent Purchaser Advances and the
        Lessor Contribution shall be applied by the Lessor solely in accordance
        with the provisions of the Operative Agreements.

    -   CHIEF PLACE OF BUSINESS. The Lessor's chief place of business, chief
        executive office and office where the documents, accounts and records
        relating to the transactions contemplated by this Agreement and each
        other Operative Agreement are kept are located at 600 Peachtree Street
        NE, Suite 2700, Atlanta, Georgia 30308.

    -   REPRESENTATIONS AND WARRANTIES. The representations and warranties of
        the Lessor set forth in the Operative Agreements are true and correct.
        The Lessor is in compliance with its respective obligations under the
        Operative Agreements.

    -   CONDITIONS PRECEDENT CONTAINED IN THE OPERATIVE AGREEMENTS. All
        conditions precedent contained in this Agreement and in the other
        Operative Agreements to be satisfied by the Lessor relating to the
        Advances have been satisfied in full.

    -   REPRESENTATIONS AND WARRANTIES OF THE LESSEE ON THE CLOSING DATE AND THE
        FUNDING DATE. Subject to SCHEDULE 7.2 hereto, the Lessee represents and
        warrants to each of the other parties hereto as of the Closing Date and
        the Funding Date as follows:

    -   ORGANIZATION; POWERS. Each of the Lessee and its Subsidiaries (i) is
        duly organized, validly existing and in good standing under the laws of
        the jurisdiction of its organization, (ii) has all requisite power and
        authority to own its property and assets and

                                      12.
<PAGE>   14

        to carry on its business as now conducted and as proposed to be
        conducted, (iii) is qualified to do business in every jurisdiction where
        such qualification is required, except where the failure so to qualify
        would not result in a Material Adverse Effect, and (iv) has the power
        and authority to execute, deliver and perform its obligations under each
        of the Operative Agreements and each other agreement or instrument
        contemplated thereby to which it is or will be a party.

    -   AUTHORIZATION. The execution, delivery and performance by the Lessee of
        each of the Operative Agreements to which it is a party (i) have been
        duly authorized by all requisite action, including, if required,
        stockholder action on the part of the Lessee and (ii) will not (A)
        violate (1) any provision of law, statute, rule or regulation, or of the
        certificate or articles of incorporation or other constitutive documents
        or by-laws of the Lessee or any Subsidiary, (2) any order of any
        Governmental Authority, or (3) any provision of any indenture, agreement
        or other instrument to which the Lessee or any Subsidiary is a party or
        by which any of them or any of their property is or may be bound,
        including, without limitation, the Credit Facility and the Subordinated
        Notes, (B) be in conflict with, result in a breach of or constitute
        (alone or with notice or lapse of time or both) a default under any such
        indenture, agreement or other instrument, or (C) result in the creation
        or imposition of any Lien upon or with respect to any property or assets
        now owned or hereafter acquired by the Lessee or any Subsidiary except
        in accordance with the Operative Agreements.

    -   ENFORCEABILITY. This Agreement and each of the other Operative
        Agreements to which the Lessee is a party has been duly executed and
        delivered by the Lessee and constitutes a legal, valid and binding
        obligation of the Lessee enforceable against the Lessee in accordance
        with its terms, subject, in each case as to enforceability, to
        bankruptcy, insolvency, reorganization and other similar laws affecting
        enforcement of creditor rights generally (insofar as any such law
        relates to the bankruptcy, insolvency, reorganization or similar event
        of the Lessee) and, as to the availability of specific performance or
        other injunctive relief, subject to the discretionary power of a court
        to deny such relief and to general equitable principles.

    -   GOVERNMENTAL APPROVALS. No action, consent or approval of, registration
        or filing with or any other action by any Governmental Authority is or
        will be required by the Lessee in connection with the purchase, leasing
        or financing of the Property (the "Transactions"), except such as have
        been made or obtained and are in full force and effect.

    -   FINANCIAL STATEMENTS. The consolidated balance sheet of the Lessee and
        its Subsidiaries as at June 30, 1999, and the related consolidated
        statements of income and cash flows of the Lessee and its Subsidiaries
        for the fiscal year then ended, accompanied by an opinion of Ernst &
        Young LLP, independent auditors, and the consolidated balance sheet of
        the Lessee and its Subsidiaries as at September 30, 1999, and the
        related consolidated statements of income and cash flows of the Lessee
        and its Subsidiaries for the three (3) months then ended, duly certified
        by the chief financial officer of the Lessee, copies of which have been
        furnished to the Lessor and the Agent, fairly present, subject, in the
        case of said balance sheet as at September 30, 1999, and said statements
        of income and cash flows for the three (3) months then ended, to
        year-end audit adjustments, the consolidated financial condition of the
        Lessee and its Subsidiaries as at such dates and the consolidated
        results of the Lessee and its Subsidiaries for the periods ended on such
        dates, all in

                                      13.
<PAGE>   15

        accordance with GAAP consistently applied. Since June 30, 1999, no event
        has occurred which could have a Material Adverse Effect.

    -   NO MATERIAL ADVERSE CHANGE. As of the Closing Date, there has been no
        material adverse change in the business, assets, property or condition,
        financial or otherwise, of the Lessee and its Subsidiaries since June
        30, 1999.

    -   TITLE TO PROPERTIES; POSSESSION UNDER LEASES.

           -   Each of the Lessee and its Subsidiaries has good and marketable
               title to, or valid leasehold interests in, all its material
               properties and assets. All such properties and assets are free
               and clear of Liens, other than Liens expressly permitted by any
               of the Operative Agreements.

           -   Each of the Lessee and its Subsidiaries has complied with all
               obligations under all leases to which it is a party and all such
               leases are in full force and effect. Each of the Lessee and its
               Subsidiaries enjoys peaceful and undisturbed possession under all
               such leases.

    -   LITIGATION, COMPLIANCE WITH LAWS.

           -   There are not any actions, suits or proceedings at law or in
               equity or by or before any Governmental Authority now pending or
               threatened against the Lessee or any Subsidiary or any business,
               property or rights of any such person (A) which involve any
               Operative Agreements or the Transactions or (B) to the Lessee's
               knowledge, which might have a Material Adverse Effect.

           -   Neither the Lessee nor any of its Subsidiaries is in violation of
               any law, rule or regulation, or in default with respect to any
               judgment, writ, injunction or decree of any Governmental
               Authority, where such violation or default could reasonably be
               anticipated to result in a Material Adverse Effect.

    -   FEDERAL RESERVE REGULATIONS. Neither the Lessee nor any of its
        Subsidiaries is engaged principally in, and does not have as one of its
        most important activities, the business of extending credit for the
        purpose of purchasing or carrying any margin stock (within the meaning
        of Regulation U of the Board), and no part of the proceeds of the
        Advances will be used by it to purchase or carry any margin stock or to
        extend credit to others for the purpose of purchasing or carrying any
        such margin stock or for any purpose that violates, or is inconsistent
        with, the provisions of Regulations T, U or X of the Board.

    -   INVESTMENT COMPANY ACT; PUBLIC UTILITY HOLDING COMPANY ACT. Neither the
        Lessor nor any of its Subsidiaries is (i) an "investment company" or a
        company controlled by an "investment company" within the meaning of the
        Investment Company Act, or (ii) a "holding company" as defined in, or
        subject to regulation under, the Public Utility Holding Company Act of
        1935.

    -   AGREEMENTS.

                                      14.
<PAGE>   16

           -   Neither the Lessee nor any of its Subsidiaries is a party to any
               agreement or instrument or subject to any corporate or other
               restriction that has resulted or could reasonably be anticipated
               to result in a Material Adverse Effect.

           -   Neither the Lessee nor any of its Subsidiaries is in default in
               any manner under any provision of any indenture or other
               agreement or instrument evidencing Indebtedness, or any other
               material agreement or instrument to which it is a party or by
               which it or any of its properties or assets are or may be bound,
               where such default could reasonably be anticipated to result in a
               Material Adverse Effect.

    -   TAX RETURNS. Each of the Lessee and its Subsidiaries has filed or caused
        to be filed all Federal, state, local and foreign tax returns required
        to have been filed by it and has paid or caused to be paid all taxes
        shown to be due and payable on such returns or on any assessments
        received by it, except taxes that are being contested in good faith by
        appropriate proceedings and for which the Lessee or such Subsidiary
        shall have set aside on its books adequate reserves.

    -   NO MATERIAL MISSTATEMENTS. No information, report, financial statement,
        exhibit or schedule furnished by or on behalf of the Lessee to the
        Lessor, the Agent or any Rent Purchaser in connection with the
        negotiation of any Operative Agreement or included therein or delivered
        pursuant thereto contained, contains or will contain any misstatement of
        a material fact or omitted, omits or will omit to state any material
        fact necessary to make the statements therein, in the light of the
        circumstances under which they were, are or will be made, not
        misleading.

    -   EMPLOYEE BENEFIT PLANS. Each of the Lessee and its ERISA Affiliates is
        in compliance in all material respects with the applicable provisions of
        ERISA and the regulations and published interpretations thereunder. No
        Reportable Event has occurred as to which the Lessee or any ERISA
        Affiliate was required to file a report with the PBGC, and the present
        value of all benefit liabilities under each Plan (based on those
        assumptions used to fund such Plan) did not, as of the last annual
        valuation date applicable thereto, exceed by more than $1,000,000 the
        value of the assets of such Plan. Neither the Lessee nor any ERISA
        Affiliate has incurred any Withdrawal Liability which remains unpaid and
        that could result in a Material Adverse Effect. Neither the Lessee nor
        any ERISA Affiliate has received any notification that any Multiemployer
        Plan is in reorganization or has been terminated within the meaning of
        Title IV of ERISA, and to the best knowledge of the Lessee no
        Multiemployer Plan is reasonably expected to be in reorganization or to
        be terminated, where such reorganization or termination has resulted or
        could reasonably be expected to result, through increases in the
        contributions required to be made to such Plan or otherwise, in a
        Material Adverse Effect.

    -   ENVIRONMENTAL MATTERS. To the best of Lessee's knowledge after due
        inquiry, the Property is free of contamination from any Release of
        Hazardous Substances. Neither the Lessee nor any of its Subsidiaries has
        any material contingent liability related to noncompliance with any
        Environmental Laws, or related to any Release or threatened Release of a
        Hazardous Substance or the generation, use, storage or disposal of
        Hazardous Substances associated with the Property. The Lessee and each
        Subsidiary is conducting its respective business in compliance with all
        applicable Environmental Laws.

                                      15.
<PAGE>   17

        Neither the Lessee nor any of its Subsidiaries has received notice of
        any failure to so comply. The Lessee and its Subsidiaries, at the
        Lessee's and its Subsidiaries' facilities, do not manage any hazardous
        wastes, hazardous substances, hazardous materials, toxic substances,
        toxic pollutants or substances similarly denominated, as those terms or
        similar terms are used in the Environmental Laws, in violation of any
        such law or any regulations promulgated pursuant thereto. Neither the
        Lessee nor any of its Subsidiaries has caused or suffered to occur any
        Release with respect to any Hazardous Substance at, under, above or upon
        any real property which it owns or leases or to which it transported,
        disposed or arranged for disposal of Hazardous Substances that would
        result in a Material Adverse Effect. Neither the Lessee nor any of its
        Subsidiaries is involved in operations which are reasonably likely to
        result in the imposition of any material liability on the Lessee or any
        of its Subsidiaries under any Environmental Law, and neither the Lessee
        nor any of its Subsidiaries has permitted any tenant or occupant of such
        premises to engage in any such activities.

    -   INSURANCE. The Lessee has obtained insurance coverage covering the
        Property which meets the requirements of Section 14.1 of Lease and such
        coverage is in full force and effect.

    -   NATURE OF THE PROPERTY. The Lessee shall use the Property for office,
        manufacturing and research and development purposes.

    -   FLOOD ZONE. No portion of the Property being acquired by the Lessor on
        the Funding Date is located in an area identified as a special flood
        hazard area by the Federal Emergency Management Agency or other
        applicable agency, or if the Property is located in an area identified
        as a special flood hazard area by the Federal Emergency Management
        Agency or other applicable agency, then flood insurance has been
        obtained for such Property in accordance with Section 14.2(b) of the
        Lease and in accordance with the National Flood Insurance Act of 1968,
        as amended.

    -   LEGAL REQUIREMENTS. The Property being acquired by the Lessor complies
        with all Legal Requirements (including all zoning and land use laws and
        Environmental Laws).

    -   CONSENTS, ETC. All consents, licenses and building permits required by
        all Legal Requirements by the time required by such Legal Requirements
        for construction, completion, occupancy and operation of the Property
        have been or will be obtained and are or will be in full force and
        effect.

    -   SOLVENCY. The fair salable value of Lessee's assets exceeds the fair
        value of its liabilities; the Lessee is not left with unreasonably small
        capital after consummation of the transactions contemplated by the
        Operative Documents; and Lessee is able to pay its debts (including
        trade debts) as they mature.

    -   YEAR 2000. Lessee has reviewed the areas within its business and
        operations which could be adversely affected by, and has developed or is
        developing a program to address on a timely basis, the "Year 2000
        Problem" (that is, the risk that computer applications used by Lessee
        may be unable to recognize and properly perform date-sensitive functions

                                      16.
<PAGE>   18

        involving certain dates prior to, on or after December 31, 1999). Based
        on such review and program, the Year 2000 Problem could not reasonably
        be expected to have a Material Adverse Effect.

    -   TITLE TO PROPERTY. As of the Funding Date, the Lessor has a valid fee
        interest in the Land, subject only to the Permitted Exceptions. The
        Lessor will at all times have good and marketable title to the
        Improvements, subject only to Permitted Exceptions.

    -   PROPERTY-RELATED MATTERS. The Property will comply with all Legal
        Requirements (including all applicable zoning and land use laws and
        Environmental Laws) and Insurance Requirements. No Improvements on the
        Property will encroach in any manner onto any adjoining land (except as
        permitted by express written easements or variance) and such
        Improvements and the use thereof by the Lessee and its agents,
        assignees, employees, invitees, lessees, licensees and tenants will
        comply with all applicable Legal Requirements (including all applicable
        Environmental Laws and building, planning, zoning and fire codes). There
        are no defects to such Improvements including, without limitation, the
        plumbing, heating, air conditioning and electrical systems thereof, and
        all water, sewer, electric, gas, telephone and drainage facilities and
        all other utilities required to adequately service such Improvements for
        their intended use will be available pursuant to adequate permits
        (including any that may be required under applicable Environmental
        Laws). There is no action, suit or proceeding (including any proceeding
        in condemnation or eminent domain or under any applicable Environmental
        Law) pending or threatened which adversely affects the title to, or the
        use, operation or value of, the Property. No fire or other casualty with
        respect to the Property has occurred which fire or other casualty
        involves an uninsured loss in excess of $500,000. All utilities serving
        the Property are located in, and in the future will be located in, and
        vehicular access to the Improvements on the Property is provided by,
        either public rights-of-way abutting the Property or Appurtenant Rights.
        All applicable licenses, approvals, authorizations, consents, permits
        (including, without limitation, building, demolition and environmental
        permits, licenses, approvals, authorizations and consents), easements
        and rights-of-way, including proof of dedication, required for the use
        and operation of the Improvements as permitted pursuant to the Lease
        have been obtained from the appropriate Governmental Authorities having
        jurisdiction or from private parties.

    -   LEASE REQUIREMENTS. The Improvements will comply with all requirements
        and conditions set forth in the Lease and all other conditions and
        requirements of the Operative Documents.

                                        -
                           PAYMENT OF CERTAIN EXPENSES

        The Lessee agrees, for the benefit of the Lessor, the Agent and each of
the Rent Purchasers, to:

    -   TRANSACTION EXPENSES. On the Closing Date and the Funding Date, pay, or
        cause to be paid, all fees, expenses and disbursements of each of the
        Lessor, the Agent and their respective counsel in connection with the
        transactions contemplated by the Operative Agreements and incurred in
        connection with the Closing Date and the Funding Date,

                                      17.
<PAGE>   19

        including all Transaction Expenses, reasonable syndication expenses and
        all other expenses in connection with the Closing Date and the Funding
        Date, including all expenses relating to the Appraisal, and all fees,
        taxes and expenses for the recording, registration and filing of
        documents.

    -   BROKERS' FEES AND STAMP TAXES. Pay or cause to be paid brokers' fees and
        any and all stamp, transfer and other similar taxes, fees and excises,
        if any, including any interest and penalties, which are payable in
        connection with the transactions contemplated by this Agreement and the
        other Operative Agreements.

    -   CERTAIN FEES AND EXPENSES. (a) Pay or cause to be paid (i) all costs and
        expenses incurred by the Lessee, the Lessor, the Agent and each Rent
        Purchaser in entering into any future amendments or supplements with
        respect to any of the Operative Agreements, whether or not such
        amendments or supplements are ultimately entered into, or giving or
        withholding of waivers of consents hereto or thereto, which have been
        requested by the Lessee, and (ii) all costs and expenses incurred by the
        Lessor and each Rent Purchaser (A) in connection with any purchase of
        all or any portion of Property by the Lessee or any other Person
        pursuant to Articles 16, 17, 20 or 21 of the Lease, or (B) in respect of
        enforcement of any of their rights and remedies in respect of the
        Operative Agreements.

    -   COMMITMENT FEE. During the Commitment Period, the Lessee agrees to pay
        or to cause to be paid to the Lessor for the account of the Lessor and
        each Rent Purchaser, respectively, a commitment fee (the "Commitment
        Fee") equal to the product of the Commitment for the Lessor and each
        Rent Purchaser multiplied by .500% per annum. Such Commitment Fee shall
        be calculated on the basis of a year of three hundred sixty (360) days
        for the actual days elapsed and shall be payable in arrears on the
        Commitment Fee Payment Date. If all or a portion of any such Commitment
        Fee shall not be paid when due, such overdue amount shall bear interest,
        payable by the Lessee on demand, at the Overdue Rate from the date of
        such non-payment until such amount is paid in full.

                                        -
                         OTHER COVENANTS AND AGREEMENTS

    -   COOPERATION WITH THE LESSEE. The Lessor, the Agent and the Rent
        Purchasers shall, to the extent reasonably requested by the Lessee (but
        without assuming additional liabilities on account thereof), at the
        Lessee's expense, cooperate with the Lessee in connection with its
        covenants contained herein or in any of the Operative Agreements,
        including, without limitation, at any time and from time to time, upon
        the request of the Lessee, to promptly and duly execute and deliver any
        and all such further instruments, documents and financing statements
        (and continuation statements related thereto) as the Lessee may
        reasonably request in order to perform such covenants. The Lessor agrees
        that, to the extent it shall obtain actual knowledge of the occurrence
        of a Default caused by the Lessor or any of its Affiliates, it shall
        promptly notify the Lessee describing the same in reasonable detail.

    -   COVENANTS OF THE LESSOR. The Lessor hereby agrees as to itself that so
        long as this Agreement is in effect:

                                      18.
<PAGE>   20

    -   DISCHARGE OF LIENS. The Lessor will not create or permit to exist at any
        time, and will, at its own cost and expense, promptly take such action
        as may be necessary duly to discharge, or to cause to be discharged, all
        Lessor Liens on the Property attributable to it or any of its
        Affiliates; provided, however, that the Lessor shall not be required to
        so discharge any such Lessor Lien while the same is being contested in
        good faith by appropriate proceedings diligently prosecuted so long as
        such proceedings shall not involve any material danger of impairment of
        the Liens of the Security Documents or of the sale, forfeiture or loss
        of, and shall not interfere with the use or disposition of, the Property
        or title thereto or any interest therein or the payment of Rent.

    -   CHANGE OF CHIEF PLACE OF BUSINESS. The Lessor shall give prompt notice
        to the Lessee and the Agent if the Lessor's chief place of business or
        chief executive office, or the office where the records concerning the
        accounts or contract rights relating to the Property are kept, shall
        cease to be located at the address set forth on SCHEDULE 2.1 hereto or
        if it shall change its name.

    -   OPERATIVE DOCUMENTS. Neither Lessor nor Agent shall:

           -   Modify this Section 9.2 without the consent of all of the Rent
               Purchasers;

           -   increase the aggregate amount of any Rent Purchaser's Commitment,
               increase the aggregate amount of any Advances required to be made
               by a Rent Purchaser pursuant to its Commitments, or extend the
               Term without the consent of such Rent Purchaser;

           -   extend the due date for any scheduled repayment of principal of
               any Rent Purchaser's Advance or reduce the principal amount of or
               rate of interest on any Rent Purchaser's Advance or extend the
               date on which interest or fees are payable in respect of such
               Rent Purchaser's Advance, in each case, without the consent of
               such Rent Purchaser;

           -   reduce the percentage set forth in the definition of "Majority
               Rent Purchasers" or any requirement hereunder that any particular
               action be taken by all Rent Purchasers without the consent of all
               Rent Purchasers;

           -   except as otherwise expressly provided in this Agreement or
               another Operative Agreement, release all or any substantial part
               of the Collateral under the Operative Agreements, in either case
               without the consent of all Rent Purchasers; or

           -   without the prior written consent of Majority Rent Purchasers,
               execute any other waiver, modification or amendment of the
               Operative Agreements, except a waiver, modification or amendment
               that the Lessee requests pursuant to express provisions of the
               Operative Agreements and that the Lessor believes in good faith
               it must execute to satisfy the requirements of the Operative
               Agreements.

    -   COVENANTS OF THE LESSEE. The Lessee hereby agrees that so long as this
        Agreement is in effect:

                                      19.
<PAGE>   21

    -   INFORMATION. The Lessee will deliver to the Lessor and the Agent:

           -   as soon as available and in any event within one hundred (100)
               days after the end of each fiscal year of the Lessee a statement
               of financial position of the Lessee and its consolidated
               subsidiaries as of the end of such fiscal year and the related
               consolidated statements of income, shareholder's equity and cash
               flows for such fiscal year, setting forth in each case in
               comparative form the figures for the previous fiscal year, all
               reported on by independent accountants of nationally recognized
               standing, together with an Officer's Certificate from the chief
               financial officer of the Lessee substantially containing a
               computation of, and showing compliance with, each of the
               financial ratios and restrictions contained in this Section 9.3
               and stating that no Default or Event of Default has occurred or
               is continuing or, if any Default or Event of Default has occurred
               and is continuing, describing it and the steps, if any, being
               taken to cure it;

           -   as soon as available and in any event within fifty (50) days
               after the end of each of the first three (3) quarters of each
               fiscal year of the Lessee, an unaudited consolidated statement of
               financial position of the Lessee as of the end of such period and
               the related consolidated statements of income, shareholders'
               equity and cash flows for such period and for the portion of the
               Lessee's fiscal year ended at the end of such period, setting
               forth in each case in comparative form the figures for the same
               period in the previous fiscal year, together with an Officer's
               Certificate of the chief financial officer of the Lessee or other
               officer responsible for the financial affairs of the Lessee
               containing a computation of, and showing compliance with, each of
               the financial ratios and restrictions contained in this Section
               9.3 and stating that no Default or Event of Default has occurred
               or is continuing or, if any Default or Event of Default has
               occurred and is continuing, describing it and the steps, if any,
               being taken to cure it;

           -   promptly after the filing thereof, if applicable, copies of all
               reports on Forms 10-K, 10-Q and 8-K (or their equivalents),
               prospectuses and registration statements which the Lessee shall
               have filed with the Securities and Exchange Commission under the
               Securities Exchange Act of 1934, as amended;

           -   if and when any member of the ERISA Group (1) gives or is
               required to give notice to the PBGC of any "reportable event" (as
               defined in Section 4043 of ERISA) with respect to any Plan which
               might constitute grounds for a termination of such Plan under
               Title IV or ERISA, or knows that the plan administrator of any
               Plan has given or is required to give notice of any such
               reportable event, a copy of the notice of such reportable event
               given or required to be given to the PBGC; (2) receives notice of
               complete or partial withdrawal liability under Title IV of ERISA
               or notice that any Multiemployer Plan is in reorganization, is
               insolvent or has been terminated, a copy of such notice; (3)
               receives notice from the PBGC under Title IV of ERISA of an
               intent to terminate, impose liability (other than for premiums
               under Section 4007 of ERISA) in respect of, or appoint a trustee
               to administer any Plan, a copy of such notice; (4) applies for a
               waiver of the minimum funding standard under Section 412 of the
               Code, a copy of such application; (5) gives notice of intent to
               terminate any Plan under Section 4041(c)

                                      20.
<PAGE>   22

               of ERISA, a copy of such notice and other information filed with
               the PBGC; (6) gives notice of withdrawal from any Plan pursuant
               to Section 4063 of ERISA, a copy of such notice; or (7) fails to
               make any payment or contribution to any Plan or Multiemployer
               Plan or in respect of any Benefit Arrangement or makes any
               amendment to any Plan or Benefit Arrangement which has resulted
               or could result in the imposition of a Lien or the posting of a
               bond or other security, a certificate of the chief financial
               officer or the chief accounting officer of the Lessee setting
               forth details as to such occurrence and action, if any, which the
               Lessee or applicable member of the ERISA Group is required or
               proposes to take;

           -   promptly after the occurrence of any Default or Event of Default,
               notice thereof in writing by an authorized officer of the Lessee,
               together with information regarding the steps, if any, being
               taken or proposed to be taken to cure it;

           -   at least ten (10) Business Days prior to the expiration of any
               policy of insurance required by Section 14 of the Lease,
               confirmation of renewal;

           -   within three days of the end of each month during which Lessee is
               required to maintain Pledged Collateral pursuant to Section
               5.4(a)(ii) hereof, a written certification of the Chief Financial
               Officer of Lessee as to Lessee's Cash Balance at the end of such
               month; and

           -   from time to time such additional information regarding the
               Lessee or the Property as the Lessor or the Agent, at the request
               of the Lessor or any Rent Purchaser, may reasonably request.

    -   COMPLIANCE WITH LAWS. The Lessee will, and will cause its Subsidiaries
        to, comply in all material respects with all applicable laws,
        ordinances, rules, regulations, orders and requirements of governmental
        authorities (including, without limitation, Environmental Laws and ERISA
        and the rules and regulations thereunder) except where the necessity of
        compliance therewith is contested in good faith by appropriate
        proceedings and such contest is not reasonably likely to result in a
        Material Adverse Effect.

    -   FURTHER ASSURANCES. The Lessee shall take or cause to be taken from time
        to time all action necessary to assure during the Term that title to the
        Property remains in the Lessor as contemplated by Section 12.1 of the
        Lease, that the Lessor holds a perfected Lien on the Property securing
        the Lease Balance as contemplated by Section 7.1 of the Lease, and that
        the Lessor and the Agent for the benefit of the Rent Purchasers hold a
        perfected Lien on the Pledged Collateral securing the Obligations.

    -   EXISTENCE; FRANCHISES; BUSINESSES. Except as otherwise expressly
        permitted in this Agreement, the Lessee shall, and shall cause each
        Subsidiary to (i) maintain in full force and effect its separate
        existence and all rights, licenses, leases and franchises reasonably
        necessary to the conduct of its business, and (ii) continue doing
        business as a whole in the substantially the same types of business in
        which they were engaged on the Closing Date.

    -   BOOKS AND RECORDS. The Lessee shall, and shall cause each Subsidiary to,
        maintain its books and records in accordance with GAAP, and permit the
        Lessor and the Agent to

                                      21.
<PAGE>   23

        make or cause to be made inspections and audits of any books, records
        and papers of the Lessee and its Subsidiaries and to make extracts
        therefrom at all such reasonable times and as often as any such Person
        may reasonably require.

    -   FUNDAMENTAL CHANGES.  The Lessee shall not, nor shall it permit any
        Subsidiary to, enter into any merger, consolidation or amalgamation,
        where it is not the surviving entity, or liquidate, wind-up or dissolve
        itself (or suffer any liquidation or dissolution); convey, sell, assign,
        transfer or otherwise dispose of all or substantially all of the
        property, business or assets of the Lessee and its Subsidiaries;
        provided, however, that if (i) at least thirty (30) days prior to the
        consummation of such transaction the Lessee shall have furnished to the
        Lessor and the Agent an Officer's Certificate of the chief financial
        officer of the Lessee that no Default or Event of Default shall occur
        after giving effect thereto, and (ii) no Default or Event of Default
        shall have occurred before or after giving effect thereto, then:

           -   any Subsidiary of the Lessee may be merged or consolidated with
               or into the Lessee (provided, however, that the Lessee shall be
               the continuing or surviving corporation) or with or into any one
               or more wholly-owned Subsidiaries of the Lessee (provided,
               however, that the wholly-owned Subsidiary or Subsidiaries shall
               be the continuing or surviving corporation); and

           -   any wholly-owned Subsidiary may sell, lease, transfer or
               otherwise dispose of any or all of its assets (upon voluntary
               liquidation or otherwise) to the Lessee or any other wholly-owned
               Subsidiary of the Lessee.

    -   LIENS. The Lessee shall not create, incur, assume or suffer to exist any
        Lien upon any of its property, assets or revenues, whether now owned or
        hereafter acquired, except for:

           -   any Lien existing on property of the Lessee on the Funding Date
               and set forth in SCHEDULE 9.3 securing Indebtedness outstanding
               on such date;

           -   any Lien created under any Operative Document;

           -   Liens for taxes, fees, assessments or other governmental charges
               which are not delinquent or remain payable without penalty;

           -   carrier's, warehousemen's, mechanics', landlords', materialmen's,
               repairmen's or other similar Liens arising in the ordinary course
               of business which are not delinquent or remain payable without
               penalty;

           -   Liens (other than any Lien imposed by ERISA) consisting of
               pledges or deposits required in the ordinary course of business
               in connection with workers' compensation, unemployment insurance
               and other social security legislation;

           -   Liens on the property of the Lessee securing (A) the
               non-delinquent performance of bids, trade contracts (other than
               for borrowed money), leases, statutory obligations, (B)
               contingent obligations on surety and appeal bonds, and (C) other

                                      22.
<PAGE>   24

               non-delinquent obligations of a like nature; in each case,
               incurred in the ordinary course of business;

           -   Liens arising solely by virtue of any statutory or common law
               provisions relating to banker's liens, rights of set-off or
               similar rights and remedies as to deposit accounts or other funds
               maintained with a depository institution; provided, however, that
               (A) such deposit account is not a dedicated cash collateral
               account and is not subject to restrictions against access by the
               Lessee in excess of those set forth by regulations promulgated by
               the Board, and (B) such deposit account is not intended by the
               Lessee or any Subsidiary to provide collateral to the depository
               institution;

           -   Permitted Liens; and

           -   Liens otherwise permitted under the Credit Facility as of the
               Closing Date.

    -   INTENTIONALLY OMITTED.

    -   FINANCIAL COVENANTS OF LESSEE. The Lessee and its Subsidiaries shall
        maintain, on a consolidated basis, all of the following financial
        covenants. The Lessee agrees and understands that (except as expressly
        provided herein) all covenants under this Section 9.3(i) shall be
        subject to compliance as measured as of the last day of each Fiscal
        Quarter.

           -   MINIMUM QUICK RATIO. Maintain a Quick Ratio of not less than 1.35
               to 1.0.

           -   MAXIMUM SENIOR INDEBTEDNESS RATIO. Maintain a Senior Indebtedness
               Ratio of not greater than 0.25 to 1.0.

           -   MINIMUM TANGIBLE NET WORTH. Maintain Tangible Net Worth on any
               date of determination (such date to be referred to herein as a
               "determination date") which occurs after December 27, 1998 (such
               date to be referred to herein as the "base date") to be less than
               the sum on such determination date of the following: (A)
               $350,000,000; plus (B) Seventy-five percent (75%) of the sum of
               the Lessee's consolidated quarterly net income (ignoring any
               quarterly losses) for each quarter ending after the base date
               through and including the quarter ending immediately prior to the
               determination date; plus (C) one hundred percent (100%) of the
               Net Issuance Proceeds of all Equity Securities issued by the
               Lessee and its Subsidiaries during the period commencing on the
               base date and ending on the determination date; plus (D) one
               hundred percent (100%) of the aggregate decrease in the total
               liabilities of the Lessee and its Subsidiaries resulting from
               conversions of convertible Subordinated Indebtedness or other
               liabilities of the Lessee and its Subsidiaries into Equity
               Securities of the Lessee and its Subsidiaries during the period
               commencing on the base date and ending on the determination date.

           -   MINIMUM DEBT SERVICE COVERAGE RATIO. Maintain a Debt Service
               Coverage Ratio of not less than the ratio set forth opposite such
               period below:

                                      23.
<PAGE>   25

                   Through December 26, 1999                 1.50  to 1.00

                   December 27, 1999 - March 26, 2000        1.75  to 1.00

                   March 27, 2000 - June 25, 2000            2.00  to 1.00

                   June 26, 2000 - September 24, 2000        2.75  to 1.00

                   Thereafter                                3.00  to 1.00


                                        -
                              TRANSFER OF INTEREST

    -   ASSIGNMENTS. Each Participant may, after consultation with, and, so long
        as no Default or Event of Default then exists, the agreement of, the
        Lessee (such agreement not to be unreasonably withheld and provided that
        no agreement by Lessee shall be required in the case of an assignment to
        an Eligible Rent Purchaser), assign all or a portion of its rights and
        obligations hereunder pursuant to an assignment agreement substantially
        in the form of EXHIBIT B (an "Assignment and Acceptance") to one or more
        Persons, with respect to Rent Purchaser Commitments and Rent Purchaser
        Advances or the Lessor Commitment and Lessor Contribution, provided that
        each such assignment shall be of a constant, not varying, percentage of
        all of the assigning Participant's rights and obligations under the
        Operative Agreements. In the case of assignments made by a Rent
        Purchaser, any such assignment shall (a) be to an Eligible Rent
        Purchaser and (b) be in a minimum aggregate amount of $5,000,000 of its
        Rent Purchaser Commitment (or the balance of such Rent Purchaser
        Commitment, if less) and the aggregate remaining Rent Purchaser
        Commitment of the assigning Rent Purchaser shall, after giving effect to
        the proposed assignment, be at least $5,000,000 or if less, zero. In the
        case of assignments made by Lessor, any such assignment shall (a) be to
        an Eligible Lessor and (b) be in a minimum aggregate amount of
        $1,000,000 of its Lessor Commitment (or the balance of such Lessor
        Commitment, if less) and the aggregate remaining Lessor Commitment of
        the assigning Lessor shall, after giving effect to the proposed
        assignment, be at least $1,000,000 or if less, zero. Any assignment
        hereunder shall be effective upon delivery to the Lessor of written
        notice of the assignment together with a transfer fee of $3,500 payable
        by the assignor Participant or the assignee Participant to the Agent for
        its own account. The assigning Participant will give prompt notice to
        the Agent and the Lessee of any such assignment. Upon the effectiveness
        of any such assignment (and after notice to and agreement of the Lessee
        and the Lessor, as provided herein), the assignee shall become a "Rent
        Purchaser" or "Lessor," as the case may be, for all purposes of the
        Operative Agreements and, to the extent of such assignment, the
        assigning Participant shall be relieved of its obligations hereunder to
        the extent of the Advances or Lessor Contribution, as the case may be,
        and Commitment components being assigned. The Lessee shall not be
        responsible for any costs or expenses incurred by any Participant in
        connection with an assignment of all or any of its rights and
        obligations in connection with an assignment pursuant to this Section
        10.1.


                                      24.
<PAGE>   26

    -   PARTICIPATIONS. Each Participant may sell, transfer, grant or assign
        participations in all or any part of such Participant's interests and
        obligations hereunder; provided, that (a) such selling Participant shall
        remain a "Rent Purchaser" or "Lessor", as the case may be, for all
        purposes under the Operative Agreements (such selling Participant's
        obligations under the Operative Agreements remaining unchanged) and the
        sub-participant shall not constitute a Rent Purchaser or a Lessor, as
        the case may be, hereunder, (b) no such sub-participant shall have, or
        be granted, rights to approve any amendment or waiver relating to the
        Operative Agreements except to the extent any such amendment or waiver
        would (i) reduce the principal of or rate of interest on or fees in
        respect of any Rent Purchaser Advances or the Lessor Contribution in
        which the sub-participant is participating, (ii) postpone the date fixed
        for any payment of principal (including extension of the Expiration Date
        or the date of any mandatory prepayment), interest or fees in which the
        sub-participant is participating, or (iii) release all or substantially
        all of the collateral or guarantees (except as expressly provided in the
        Operative Agreements) supporting any of the Rent Purchaser Advances or
        Lessor Contribution or Commitments in which the sub-participant is
        participating, and (c) sub-sub-participations by the sub-participant
        (except to an Affiliate, parent company or Affiliate of a parent company
        of the participant) shall be prohibited. In the case of any such
        participation, the sub-participant shall not have any rights under the
        Operative Agreements (the sub-participants rights against the selling
        Participant in respect of such participation to be those set forth in
        the participation agreement with such Participant creating such
        participation) and all amounts payable by the Lessee hereunder shall be
        determined as if such Participant had not sold such participation;
        provided, however, that such sub-participant shall be entitled to
        receive additional amounts under Sections 11.2 and 11.6 on the same
        basis as if it were a Participant (but only to the extent that the
        Participant would have been entitled to receive such additional amounts
        with respect to the interest participated had it not sold such
        participation). The Lessee shall not be responsible for any costs or
        expenses incurred by any Participant in connection with a sale,
        transfer, grant or assignment of participations pursuant to this Section
        10.2.

    -   DISCLOSURE OF INFORMATION; PLEDGE UNDER REGULATION A.

    -   Any Participant may, in connection with any assignment or participation
        or proposed assignment or participation pursuant to this Section 10,
        disclose to such assignee or participant or proposed assignee or
        participant, any information relating to Lessee or the Transactions,
        provided, that prior to such disclosure such proposed assignee or
        participant shall have agreed in writing to keep any such information
        confidential substantially on the terms of Section 10.3(b).

    -   The Agent, the Rent Purchasers and the Lessor understand that some of
        the information and documents furnished to it pursuant to the Operative
        Agreements may be confidential and each of them agrees that it will keep
        all non-public information, documents and agreements so furnished to it
        confidential and will make no disclosure to other Persons of such
        information or agreements until it shall have become public, except
        disclosure may be made (i) to the extent required in connection with
        matters involving operations under or enforcement or amendment of the
        Operative Agreements; (ii) to the Rent Purchasers' and the Lessor's
        examiners and auditors or in accordance with the Rent Purchasers' or
        Lessor's obligations under law or regulations or pursuant to subpoenas
        or other process to

                                      25.
<PAGE>   27

        make information available to governmental agencies and examiners or to
        others; (iii) to any corporate Affiliate of any Participant so long as
        such Affiliate agrees to accept such information or agreement subject
        too the restrictions provided in this Section 10.3(b); (iv) to the
        Participant's counsel and other professional advisors so long as such
        Persons are instructed to keep such information confidential in
        accordance with the provisions of this Section 10.3(b); (v) to proposed
        assignees and participants in accordance with Section 10.3(a); and (vi)
        with the prior written consent of the Lessee.

    -   Anything in this Section 10 to the contrary notwithstanding, any
        Participant may without the consent of Lessee, the Agent, the Rent
        Purchasers or the Lessor assign and pledge all or any portion of the
        Obligations held by it to any Federal Reserve Bank, the United States
        Treasury or to any other financial institution as collateral security
        pursuant to Regulation A of the Federal Reserve Board and any operating
        circular issued by the Federal Reserve System and/or the Federal Reserve
        Bank or otherwise; provided, any payment by Lessee for the benefit of
        the assigning or pledging Participant shall be deemed to satisfy the
        Lessee's obligations with respect thereto.

                                        -
                                 INDEMNIFICATION

    -   GENERAL INDEMNITY. The Lessee, whether or not any of the transactions
        contemplated hereby shall be consummated, hereby assumes liability for
        and agrees to defend, indemnify and hold harmless each Indemnified
        Person on an After Tax Basis from and against any Claims which may be
        imposed on, incurred by or asserted against an Indemnified Person in any
        way relating to or arising or alleged to arise out of (a) the financing,
        refinancing, ground lease purchase, acceptance, rejection, ownership,
        design, construction, delivery, acceptance, nondelivery, leasing,
        subleasing, possession, use, operation, repair, maintenance,
        modification, transportation, condition, operation, sale, return,
        repossession (whether by summary proceedings or otherwise), or any other
        disposition of the Property or any part thereof, (b) any latent or other
        defects in any property whether or not discoverable by an Indemnified
        Person or the Lessee; (c) a violation of any Legal Requirement or
        Requirement of Law, including any violation of Environmental Laws, the
        Release, presence or use of Hazardous Substances on, at, under or
        emanating from the Property or other loss of or damage relating to the
        Property; (d) the Operative Agreements, or any transaction contemplated
        thereby; (e) any breach by the Lessee of any of its representations or
        warranties under the Operative Agreements or failure by the Lessee to
        perform or observe any covenant or agreement to be performed by it under
        any of the Operative Agreements; (f) personal injury, death or property
        damage relating to the Property, including Claims based on strict
        liability in tort; (g) the existence of any Lien on or with respect to
        the Property, the Improvements, the Equipment, any Basic Rent or
        Supplemental Rent, title thereto, or any interest therein, including any
        Liens which arise out of the possession, use, occupancy, construction,
        repair or rebuilding of the Property or by reason of labor or materials
        furnished or claimed to have been furnished to the Lessee, the Lessor,
        or any of their contractors or agents or by reason of the financing of
        the Property or any personally or equipment purchased or leased by the
        Lessee or Improvements or Modifications constructed by the Lessee,
        except Lessor Liens and Liens in favor of the Agent or the Lessor; and
        (h) the Transactions contemplated hereby or by any other Operative
        Agreement, in respect of the

                                      26.
<PAGE>   28

        application of Parts 4 and 5 of Subtitle B of Title I of ERISA and any
        prohibited transaction described in Section 4975(c) of the Code; but in
        any event excluding (x) Claims to the extent such Claims arise solely
        out of events occurring after the expiration of the Term and after the
        Lessee's discharge of all its obligations under the Lease and the other
        Operative Agreements or (y) as to any Indemnified Person, any Claim to
        the extent resulting from the willful misconduct or gross negligence of
        such Indemnified Person. The Lessee shall be entitled to control, and
        shall assume full responsibility for the defense of, any Claim;
        provided, however, that any Indemnified Person named in such Claim may
        retain separate counsel reasonably acceptable to the Lessee at the
        expense of the Lessee in the event of and to the extent of an actual
        conflict. The Lessee and each Indemnified Person agree to give each
        other prompt written notice of any Claim hereby indemnified against but
        the giving of any such notice by an Indemnified Person shall not be a
        condition to the Lessee's obligations under this Section 11.1, except to
        the extent failure to give such notice materially prejudices the
        Lessee's rights hereunder. After an Indemnified Person has been fully
        indemnified for a Claim pursuant to this Section 11.1, and so long as no
        Event of Default shall have occurred and be continuing, the Lessee shall
        be subrogated to any right of such Indemnified Person with respect to
        such Claim. None of the Indemnified Persons shall settle a Claim without
        the consent of the Lessee, which consent shall not be unreasonably
        withheld or delayed.

    -   GENERAL IMPOSITIONS INDEMNITY.

    -   INDEMNIFICATION. The Lessee shall pay and assume liability for, and does
        hereby agree to indemnify, protect and defend the Property and all
        Indemnified Persons, and hold them harmless against, all Impositions on
        an After Tax Basis.

    -   PAYMENTS.

           -   Subject to the terms of Section 11.2(f), the Lessee shall pay or
               cause to be paid all Impositions directly to the taxing
               authorities where feasible and otherwise to the Indemnified
               Person, as appropriate, and the Lessee shall at its own expense,
               upon such Indemnified Person's reasonable request, furnish to
               such Indemnified Person copies of official receipts or other
               satisfactory proof evidencing such payment.

           -   In the case of Impositions for which no contest is conducted
               pursuant to Section 11.2(f) and which the Lessee pays directly to
               the taxing authorities, the Lessee shall pay such Impositions
               thirty (30) days prior to the latest time permitted by the
               relevant taxing authority for timely payment. In the case of
               Impositions for which the Lessee reimburses an Indemnified
               Person, the Lessee shall do so within twenty (20) days after
               receipt by the Lessee of demand by such Indemnified Person
               describing in reasonable detail the nature of the Imposition and
               the basis for the demand (including the computation of the amount
               payable), but in no event shall the Lessee be required to pay
               such reimbursement prior to thirty (30) days before the latest
               time permitted by the relevant taxing authority for timely
               payment. In the case of Impositions for which a contest is
               conducted pursuant to Section 11.2(f), the Lessee shall pay such
               Impositions or reimburse such Indemnified Person for such
               Impositions, to the extent not previously paid or

                                      27.
<PAGE>   29

               reimbursed pursuant to subsection (a), thirty (30) days prior to
               the latest time permitted by the relevant taxing authority for
               timely payment after conclusion of all contests under Section
               11.2(f).

           -   Impositions imposed with respect to the Property for a billing
               period during which the Lease expires or terminates (unless a
               Renewal Term is to apply or the Lessee has exercised the Purchase
               Option or the Maturity Date Purchase Option with respect to the
               Property) shall be adjusted and prorated on a daily basis between
               the Lessee and the Lessor, whether or not such Imposition is
               imposed before or after such expiration or termination and each
               party shall pay or reimburse the other for each party's pro rata
               share thereof.

           -   At the Lessee's request, the amount of any indemnification
               payment by the Lessee pursuant to subsection (a) shall be
               verified and certified by an independent public accounting firm
               mutually acceptable to the Lessee and the Indemnified Person. The
               fees and expenses of such independent public accounting firm
               shall be paid by the Lessee unless such verification shall result
               in an adjustment in the Lessee's favor of 10% or more of the
               payment as computed by the Indemnified Person, in which case such
               fee shall be paid by the Indemnified Person.

    -   REPORTS AND RETURNS. (i) The Lessee shall be responsible for preparing
        and filing any real and personal property or ad valorem tax returns in
        respect of the Property. In case any other report or tax return shall be
        required to be made with respect to any obligations of the Lessee under
        or arising out of subsection (a) and of which the Lessee has knowledge
        or should have knowledge, the Lessee, at its sole cost and expense,
        shall notify the relevant Indemnified Person of such requirement and
        (except if such Indemnified Person notifies the Lessee that such
        Indemnified Person intends to file such report or return) (A) to the
        extent required or permitted by and consistent with applicable law, make
        and file in its own name such return, statement or report; and (B) in
        the case of any other such return, statement or report required to be
        made in the name of such Indemnified Person, advise such Indemnified
        Person of such fact and prepare such return, statement or report for
        filing by such Indemnified Person or, where such return, statement or
        report shall be required to reflect items in addition to any obligations
        of the Lessee under or arising out of subsection (a), provide such
        Indemnified Person at the Lessee's expense with information sufficient
        to permit such return, statement or report to be properly made with
        respect to any obligations of the Lessee under or arising out of
        subsection (a). Such Indemnified Person shall, upon the Lessee's request
        and at the Lessee's expense, provide any data maintained by such
        Indemnified Person (and not otherwise available to or within the control
        of the Lessee) with respect to the Property which the Lessee may
        reasonably require to prepare any required tax returns or reports. Each
        Indemnified Person agrees to use commercially reasonable efforts to send
        to the Lessee a copy of any written request or other notice that the
        Indemnified Person receives with respect to any reports or returns
        required to be filed with respect to the Property or the transactions
        contemplated by the Operative Documents, it being understood that no
        Indemnified Person shall have any liability for failure to provide such
        copies.

    -   INCOME INCLUSIONS. If as a result of the payment or reimbursement by the
        Lessee of any expenses of any Lessor or the payment of any Transaction
        Expenses incurred in

                                      28.
<PAGE>   30

        connection with the transactions contemplated by the Operative
        Documents, the Lessor or any Rent Purchaser shall suffer a net increase
        in any federal, state or local income tax liability, the Lessee shall
        indemnify such Persons (without duplication of any indemnification
        required by subsection (a)) on an After Tax Basis for the amount of such
        increase. The calculation of any such net increase shall take into
        account any current or future tax savings realized or reasonably
        expected to be realized by such person in respect thereof, as well as
        any interest, penalties and additions to tax payable by the Lessor, the
        Lender or such Affiliate, in respect thereof.

    -   WITHHOLDING TAXES.  As between the Lessee on one hand, and any
        Participant on the other hand, the Lessee shall be responsible for, and,
        subject to the provisions of Sections 11.2(g) and (h), the Lessee shall
        indemnify and hold harmless the Participants (without duplication of any
        indemnification required by subsection (a)) on an After Tax Basis
        against, any obligation for United States or foreign withholding taxes
        imposed in respect of payments with respect to the Rent Purchaser
        Advances or the Lessor Contribution or with respect to Rent payments
        under the Lease or payments of the Termination Value or the Purchase
        Option Price (and, if any Participant receives a demand for such payment
        from any taxing authority, the Lessee shall discharge such demand on
        behalf of such Participant).

    -   CONTESTS OF IMPOSITIONS.

           -   If a written claim is made against any Indemnified Person or if
               any proceeding shall be commenced against such Indemnified Person
               (including a written notice of such proceeding), for any
               Impositions, such Indemnified Person shall promptly notify the
               Lessee in writing and shall not take action with respect to such
               claim or proceeding without the consent of the Lessee for thirty
               (30) days after the receipt of such notice by the Lessee;
               provided, however, that, in the case of any such claim or
               proceeding, if action shall be required by law or regulation to
               be taken prior to the end of such 30-day period, such Indemnified
               Person shall, in such notice to the Lessee, inform the Lessee of
               such shorter period, and no action shall be taken with respect to
               such claim or proceeding without the consent of the Lessee before
               two days before the end of such shorter period; provided,
               further, that the failure of such Indemnified Person to give the
               notices referred to in this sentence shall not diminish the
               Lessee's obligation hereunder except to the extent such failure
               precludes the Lessee from contesting all or part of such claim.

           -   If, within thirty (30) days of receipt after such notice from the
               Indemnified Person (or such shorter period as the Indemnified
               Person has notified the Lessee as required by law or regulation
               for the Indemnified Person to commence such contest), the Lessee
               shall request in writing that such Indemnified Person contest
               such Imposition, the Indemnified Person shall, at the expense of
               the Lessee, in good faith conduct and control such contest
               (including, without limitation, by pursuit of appeals) relating
               to the validity, applicability or amount of such Impositions
               (provided, however, that (A) if such contest involves a tax other
               than a tax on net income and can be pursued independently from
               any other proceeding involving a tax liability of such
               Indemnified Person, the Indemnified Person, at the Lessee's
               request, shall allow the Lessee to conduct and control such
               contest

                                      29.
<PAGE>   31

               and (B) in the case of any contest, the Indemnified Person may
               request the Lessee to conduct and control such contest) by, in
               the sole discretion of the Person conducting and controlling such
               contest, (1) resisting payment thereof, (2) not paying the same
               except under protest, if protest is necessary and proper, or (3)
               if the payment be made, using reasonable efforts to obtain a
               refund thereof in appropriate administrative and judicial
               proceedings.

           -   The party controlling any contest shall consult in good faith
               with the non-controlling party and shall keep the non-controlling
               party reasonably informed as to the conduct of such contest;
               provided, that all decisions ultimately shall be made in the sole
               discretion of the controlling party. The parties agree that an
               Indemnified Person may at any time decline to take further action
               with respect to the contest of any Imposition and may settle such
               contest if such Indemnified Person shall waive its rights to any
               indemnity from the Lessee that otherwise would be payable in
               respect of such claim and shall pay to the Lessee any amount
               previously paid or advanced by the Lessee pursuant to this
               Section 11.2 by way of indemnification or advance for the payment
               of an Imposition other than expenses of such contest.

           -   Notwithstanding the foregoing provisions of this Section 11.2, an
               Indemnified Person shall not be required to take any action and
               the Lessee shall not be permitted to contest any Impositions in
               its own name or that of the Indemnified Person unless (A) the
               Lessee shall have agreed to pay in writing and shall pay to such
               Indemnified Person on demand and on an After Tax Basis all
               reasonable costs, losses and expenses that such Indemnified
               Person actually incurs in connection with contesting such
               Impositions, including, without limitation, all reasonable legal,
               accounting and investigatory fees and disbursements and the
               contested claim if ultimately required to be paid, (B) in the
               case of a claim that must be pursued in the name of an
               Indemnified Person (or an Affiliate thereof), the amount of the
               potential indemnity exceeds $50,000, (C) the Indemnified Person
               shall have reasonably determined that the action to be taken will
               not result in any material danger of sale, forfeiture or loss of
               the Property or the Defeasance Deposit Collateral, or any part
               thereof or interest therein, will not interfere with the payment
               of Rent, and will not result in risk of criminal liability, (D)
               if such contest shall involve the payment of the Imposition prior
               to the contest, the Lessee shall provide to the Indemnified
               Person an interest-free advance in an amount equal to the
               Imposition that the Indemnified Person is required to pay (with
               no additional net after-tax cost to such Indemnified Person), (E)
               the Lessee shall have provided to such Indemnified Person an
               opinion of independent tax counsel selected by the Lessee and
               reasonably satisfactory to the Indemnified Person stating that a
               reasonable basis exists to contest such claim (or, in the case of
               an appeal of an adverse determination, an opinion of such counsel
               to the effect that the position asserted in such appeal will more
               likely than not prevail), and (F) no Event of Default shall have
               occurred and be continuing. In no event shall an Indemnified
               Person be required to appeal an adverse judicial determination to
               the United States Supreme Court. In addition, an Indemnified
               Person shall not be required to contest any claim in its name (or
               that of an Affiliate) if the subject matter thereof shall be of a
               continuing nature and shall have previously been decided
               adversely by a court of competent jurisdiction pursuant to the
               contest provisions of this Section 11.2,

                                      30.
<PAGE>   32

               unless there shall have been a change in law (or interpretation
               thereof) and the Indemnified Person shall have received, at the
               Lessee's expense, an opinion of independent tax counsel selected
               by the Indemnified Person and reasonably acceptable to the Lessee
               stating that as a result of such change in law (or interpretation
               thereof), it is more likely than not that the Indemnified Person
               will prevail in such contest.

    -   DOCUMENTATION OF WITHHOLDING STATUS. Each Participant (or any successor
        thereto or Transferee thereof) that is organized under the laws of a
        jurisdiction outside of the United States of America shall:

           -   on or before the date it becomes a party to any Operative
               Agreement, deliver to the Lessee any certificates, documents or
               other evidence that shall be required by the Code or Treasury
               Regulations issued pursuant thereto to establish its exemption
               from United States Federal withholding requirements, including
               (A) two (2) valid, duly completed, original copies of Internal
               Revenue Service Form 1001 or Form 4224 or successor applicable
               form, properly and duly executed, certifying in each case that
               such party is entitled to receive payments pursuant to the
               Operative Documents without deduction or withholding of United
               States Federal income taxes, and (B) a valid, duly completed,
               original copy of Internal Revenue Service Form W-8 or Form W-9 or
               applicable successor form, properly and duly executed, certifying
               that such party is entitled to an exemption from United States of
               America backup withholding tax; and

           -   or before the date that any such form described above expires or
               becomes obsolete, or after the occurrence of any event requiring
               a change in the most recent such form previously delivered to the
               Lessee, deliver to the Lessee two (2) further valid, duly
               completed, original copies of any such form or certification,
               properly and duly executed.

    -   LIMITATION ON TAX INDEMNIFICATION. The Lessee shall not be required to
        indemnify any Indemnified Person, or to pay any increased amounts to any
        Indemnified Person or tax authority with respect to any Impositions
        pursuant to this Section 11.2 to the extent that (i) any obligation to
        withhold, deduct, or pay amounts with respect to Tax existed on the date
        such Indemnified Person became a party to any Operative Agreement (and,
        in such case, the Lessee may deduct and withhold such Tax from payments
        pursuant to the Operative Agreements), or (ii) such Indemnified Person
        fails to comply with the provisions of Section 11.2(g) (and, in such
        case, the Lessee may deduct and withhold all Taxes required by law as a
        result of such noncompliance from payments made by the Lessee pursuant
        to the Operative Agreements). With respect to any Transferee of any
        Participant (including a transfer resulting from any change in the
        designation of the lending office of a Participant), the Transferee
        shall not be entitled to any greater payment or indemnification under
        this Section 11.2 than the transferor would have been entitled to.

    -   LIBOR LENDING UNLAWFUL. Notwithstanding any other provision herein, if
        the adoption of or any change in any Requirement of Law or in the
        interpretation or application thereof occurring after the Closing Date
        shall make it unlawful for any Participant to make, continue or maintain
        LIBOR Rent Purchaser Advances or LIBOR Lessor Contributions as
        contemplated by the Operative Agreements, (a) such Participant shall

                                      31.
<PAGE>   33

        promptly give written notice of such circumstances to the Lessee, the
        Lessor and the Rent Purchasers (which notice shall be withdrawn whenever
        such circumstances no longer exist), (b) such Participant shall
        undertake reasonable efforts to propose a money rate comparable to LIBOR
        (the "LIBOR Alternative"), (c) the commitment of such Rent Purchaser or
        Lessor, as the case may be, hereunder to make, continue or maintain
        LIBOR Rent Purchaser Advances or LIBOR Lessor Contributions shall
        forthwith be canceled and, until such time as it shall no longer be
        unlawful for such Participant to make, continue or maintain LIBOR Rent
        Purchaser Advances or LIBOR Lessor Contributions, such Participant shall
        then have a commitment only to make or maintain Rent Purchaser Advances
        or the Lessor Contributions based on ABR or the LIBOR Alternative, if
        any, when a LIBOR Rent Purchaser Advance or LIBOR Lessor Contribution is
        requested and (d) such Participant's Rent Purchaser Advances and Lessor
        Contributions then outstanding as LIBOR Rent Purchaser Advances or LIBOR
        Lessor Contributions, if any, shall be converted automatically to Rent
        Purchaser Advances or Lessor Contributions based on ABR or the LIBOR
        Alternative, if any, on the respective last days of the then current
        Interest Periods with respect to such Rent Purchaser Advances and Lessor
        Contributions or within such earlier period as required by law. If any
        such conversion of LIBOR Rent Purchaser Advances or LIBOR Lessor
        Contributions occurs on a day which is not the last day of the then
        current Interest Period with respect thereto, the Lessee shall pay to
        such Participant such amounts, if any, as may be required pursuant to
        Section 11.6. In any such case, interest and principal (if any) shall be
        payable contemporaneously with the related LIBOR Rent Purchaser Advances
        or LIBOR Lessor Contributions of the other Participants.

    -   DEPOSITS UNAVAILABLE.  If any of the Participants shall have determined
        that:

    -   Dollar deposits in the relevant amount and for the relevant Interest
        Period are not available to the Participant in its relevant market; or

    -   by reason of circumstances affecting the Participant's relevant market,
        adequate means do not exist for ascertaining the interest rate or Yield,
        as the case may be, applicable to such Participant's LIBOR Rent
        Purchaser Advances or LIBOR Lessor Contributions;

        then, upon notice from such Participant to the Lessee and the other
Participants, (x) the obligations of the Participants to make or continue any
Rent Purchaser Advances or the Lessor Contributions as, or to convert any Rent
Purchaser Advances or the Lessor Contribution into, LIBOR Rent Purchaser
Advances or LIBOR Lessor Contributions shall be suspended, and (y) each
outstanding LIBOR Rent Purchaser Advance or LIBOR Lessor Contribution shall
automatically convert into an Rent Purchaser Loan or Lessor Contribution based
on ABR or the LIBOR Alternative, if any, on the last day of the current Interest
Period applicable thereto.

    -   INCREASED COSTS, ETC.

    -   If the adoption of or any change in a Requirement of Law or in the
        interpretation or application thereof applicable to any Participant, or
        compliance by any Participant with any request or directive (whether or
        not having the force of law) from any central bank or

                                      32.
<PAGE>   34

        other Governmental Authority, in each case made subsequent to the
        Closing Date (or, if later, the date on which such Participant becomes a
        Participant):

           -   shall subject such Participant to any tax of any kind whatsoever
               with respect to any LIBOR Rent Purchaser Advances or LIBOR Lessor
               Contributions made, continued or maintained by it or its
               obligation to make, continue or maintain LIBOR Rent Purchaser
               Advances or LIBOR Lessor Contributions, or change the basis of
               taxation of payments to such Participant in respect thereof; or

           -   shall impose, modify or hold applicable any reserve, special
               deposit, compulsory loan or similar requirement against assets
               held by, deposits or other liabilities in or for the account of,
               Rent Purchaser Advances and the Lessor Contribution, advances or
               other extensions of credit by, or any other acquisition of funds
               by, any office of such Participant which is not otherwise
               included in the determination of the Adjusted LIBOR Rate
               hereunder; or

           -   shall impose on such Participant any other condition (excluding
               any Tax of any kind) whatsoever in connection with the Operative
               Agreements;

and the result of any of the foregoing is to increase the cost to such
Participant, by an amount which such Participant reasonably deems to be
material, of making, continuing or maintaining LIBOR Advances or LIBOR Lessor
Contributions or to reduce any amount receivable hereunder in respect thereof,
then, in any such case, upon notice to the Lessee from such Participant, through
the Lessor or the Agent, in accordance herewith, the Lessee shall pay such
Participant any additional amounts necessary to compensate such Participant for
such increased cost or reduced amount receivable; provided, that, in any such
case, the Lessee may elect to convert the LIBOR Rent Purchaser Advances or LIBOR
Lessor Contributions made by such Participant hereunder to Rent Purchaser
Advances or Lessor Contributions based on ABR or the LIBOR Alternative, if any,
by giving the Lessor and the Agent at least one (1) Business Day's notice of
such election, in which case the Lessee shall promptly pay to such Participant,
upon demand, without duplication, such amounts, if any, as may be required
pursuant to Section 11.6. All payments required by this Section 11.5 shall be
made by the Lessee within ten (10) Business Days after demand by the affected
Participant. The Lessee shall not be obligated to reimburse any Participant for
any increased cost or reduced return incurred more than one hundred eighty (180)
days after the date that such Participant receives actual notice of such
increased cost or reduced return unless such Participant gives notice thereof to
the Lessee in accordance with this Section 11.5 during such one hundred eighty
(180) day period. If any Participant becomes entitled to claim any additional
amounts pursuant to this subsection, it shall provide prompt notice thereof to
the Lessee, through the Lessor, certifying (x) that one of the events described
in this clause (a) has occurred and describing in reasonable detail the nature
of such event, (y) as to the increased cost or reduced amount resulting from
such event, and (z) as to the additional amount demanded by such Participant and
a reasonably detailed explanation of the calculation thereof (including the
method by which such Participant allocated such amounts to the Lessee). Such a
certificate as to any additional amounts payable pursuant to this clause
submitted by such Participant, through the Lessor, to the Lessee shall be
conclusive in the absence of manifest error. This covenant shall survive the
termination of this Agreement and the payment of the Rent Purchaser Advances and
the Lessor Contribution and all other amounts payable hereunder.


                                      33.
<PAGE>   35

    -   Each Participant shall use its reasonable efforts to reduce or eliminate
        any claim for compensation pursuant to this Section 11.5, including,
        without limitation, a change in the office of such Participant at which
        its obligations related to this Agreement are maintained if such change
        will avoid the need for or reduce the amount of, such compensation and
        will not, in the reasonable judgment of such Participant, be otherwise
        disadvantageous to it. If any such claim for compensation shall not be
        eliminated or waived, the Lessee shall have the right to replace the
        affected Participant with a new financial institution that shall succeed
        to the rights of such Participant under this Participation Agreement;
        provided, that such Participant shall not be replaced hereunder until it
        has been paid in full such claim and all other amounts owed to it
        hereunder.

    -   FUNDING LOSSES. The Lessee agrees to indemnify each Indemnified Person
        and to hold each Indemnified Person harmless from any loss or expense
        which such Indemnified Person may sustain or incur (other than through
        such Person's own gross negligence or willful misconduct) as a
        consequence of (a) default by the Lessee in making a borrowing of or
        continuation of Rent Purchaser Advances or the Lessor Contribution which
        are LIBOR Rent Purchaser Advances or LIBOR Lessor Contributions after
        the Lessee has given a notice requesting the same in accordance with the
        provisions of this Agreement, (b) default by the Lessee in making any
        prepayment of a Rent Purchaser Advance or the Lessor Contribution which
        is a LIBOR Rent Purchaser Advance or a LIBOR Lessor Contribution after
        the Lessee has given a notice thereof in accordance with the provisions
        of this Agreement, or (c) the making of a prepayment of Rent Purchaser
        Advances or the Lessor Contribution which are LIBOR Rent Purchaser
        Advances or LIBOR Lessor Contributions on a day which is not the last
        day of an Interest Period with respect thereto. This covenant shall
        survive the termination of this Agreement or any other Operative
        Agreement and the payment of the Rent Purchaser Advances, the Lessor
        Contribution and all other amounts payable under the Operative
        Agreements.

    -   CAPITAL ADEQUACY.

    -   If the adoption of any applicable law, rule or regulation regarding
        capital adequacy, or any change therein, or any change in the
        interpretation or administration thereof by any Governmental Authority,
        central bank or comparable agency charged with the interpretation or
        administration thereof, or compliance by any Participant with any
        request or directive regarding capital adequacy (whether or not having
        the force of law) of any such authority, central bank or comparable
        agency, in each case made subsequent to the Closing Date, has or will
        have the effect of reducing the rate of return on any Participant's or
        its parent company's capital by an amount such Participant reasonably
        deems to be material, as a consequence of its commitments or obligations
        hereunder to a level below that which such Participant or its parent
        company could have achieved but for such adoption, effectiveness, change
        or compliance (taking into consideration such Participant's or its
        parent company's policies with respect to capital adequacy), then, upon
        notice from such Participant, the Lessee shall pay to such Participant
        such additional amount or amounts as will compensate such Participant
        and its parent company for such reduction (it being understood that such
        parent company shall not be reimbursed to the extent its subsidiary
        Participant is reimbursed by the Lessee in connection with the same or a
        similar law, rule, regulation, change, request or directive applicable
        to such Participant). All payments required by this Section 11.7 shall
        be made by the Lessee within ten (10) Business Days

                                      34.
<PAGE>   36

        after demand by the affected Participant. The Lessee shall not be
        obligated to reimburse any Participant for any reduced return incurred
        more than one hundred eighty (180) days after the date that such
        Participant receives actual notice of such reduced return unless such
        Participant gives notice thereof to the Lessee in accordance with this
        Section 11.7 during such one hundred eighty (180) day period. If any
        Participant becomes entitled to claim any additional amounts pursuant to
        this Section 11.7, it shall provide prompt notice thereof to the Lessee,
        through the Lessor and the Agent, certifying (i) that one of the events
        described in this clause (a) has occurred and describing in reasonable
        detail the nature of such event, (ii) as to the increased cost or
        reduced amount resulting from such event and (iii) as to the additional
        amount demanded by such Participant and a reasonably detailed
        explanation of the calculation thereof. Such a certificate as to any
        additional amounts payable pursuant to this clause submitted by such
        Participant, through the Lessor, to the Lessee shall be conclusive in
        the absence of manifest error. This covenant shall survive the
        termination of this Agreement and the other Operative Agreements and the
        payment of the Rent Purchaser Advances, the Lessor Contribution and all
        other amounts payable hereunder and thereunder.

    -   Each Participant shall use its commercially reasonable efforts to reduce
        or eliminate, any claim for compensation pursuant to this Section 11.7,
        including, without limitation, a change in the office of such
        Participant at which its obligations related to the Operative Agreements
        are maintained if such change will avoid the need for, or reduce the
        amount of, such compensation and will not, in the reasonable judgment of
        such Participant, be otherwise disadvantageous to it. If any such claim
        for compensation shall not be eliminated or waived, the Lessee shall
        have the right to replace the affected Participant with a new financial
        institution that shall succeed to the rights of such Participant under
        the Operative Agreements; provided, however, that such Participant shall
        not be replaced hereunder until it has been paid in full such claim and
        all other amounts owed to it hereunder.

                                        -
                                  DISTRIBUTION

    -   BASIC RENT. Each payment of Basic Rent (and any payment of interest on
        overdue installments of Basic Rent) received by the Lessor shall be
        distributed by the Lessor to the Lessor and the Agent for the Rent
        Purchasers pro rata in accordance with, and for application to the Basic
        Rent then due, as well as any overdue interest or Yield due to the
        Lessor or the Rent Purchasers (to the extent permitted by applicable
        law).

    -   PURCHASE PAYMENTS BY THE LESSEE. Any payment received by the Lessor as a
        result of:

    -   the purchase of the Property in connection with the exercise of the
        Purchase Option or Maturity Date Purchase Option under Section 20.1 or
        20.2 of the Lease; or

    -   compliance with the obligation to purchase the Property in accordance
        with Section 17.2 of the Lease; or


                                      35.
<PAGE>   37

    -   the payment of the Termination Value in accordance with Section 16.1 of
        the Lease shall be distributed by the Lessor to the Lessor and the Rent
        Purchasers in the following order of priority:

                      First, to the Rent Purchasers, pro rata, to pay the Lease
        Balance Debt; and

                      Second, to the Lessor to pay the Lease Balance Equity.

    -   PAYMENT OF LEASE BALANCE DEBT. In accordance with Section 21.1 of the
        Lease upon the exercise of the remarketing option, the payment of the
        Maximum Residual Guarantee Amount received by the Lessor shall be
        distributed to the Agent on behalf of the Rent Purchasers for
        application to pay in full the Participant Balance of each Rent
        Purchaser, pro rata among the Rent Purchasers without priority of one
        over the other in the proportion that the Participant Balance of each
        such Rent Purchaser bears to the aggregate Participant Balances of all
        Rent Purchasers.

    -   SALES PROCEEDS OF REMARKETING OF PROPERTY. Any payments received by the
        Lessor as proceeds from the sale of the Property sold pursuant to the
        exercise of the remarketing option pursuant to Article 21 of the Lease,
        together with any payment made as a result of an appraisal pursuant to
        Section 21.3 of the Lease, shall be distributed by the Lessor in the
        funds so received in the following order of priority:

               First, to cover the costs and expenses of such sale;

               Second, to the extent not previously paid as required by Section
12.3 hereof, an amount equal to the amount of the Lease Balance Debt remaining
unpaid shall be distributed to the Rent Purchasers, pro rata, as set forth in
Section 12.3;

               Third, an amount equal to the aggregate Lease Balance Equity
shall be distributed to the Lessor for application to the Participant Balance of
the Lessor; and

               Fourth, the balance, if any, shall be promptly paid to the
Lessee.

    -   SUPPLEMENTAL RENT. All payments of Supplemental Rent received by the
        Lessor (excluding any amounts payable pursuant to the preceding
        provisions of this Section 12) shall be distributed promptly by the
        Lessor upon receipt thereof to the Persons entitled thereto pursuant to
        the Operative Agreements.

    -   DISTRIBUTION OF PAYMENTS AFTER EVENT OF DEFAULT.

    -   During the continuance of an Event of Default and subject to clause (b)
        below, all proceeds received by the Lessor from the sale of the Property
        shall be distributed by the Lessor in the following order of priority:

               First, so much of such payment or amount as shall be required to
pay or reimburse the Lessor and the Agent for any tax, fees, expense,
indemnification or other

                                      36.
<PAGE>   38

loss incurred by the Lessor or the Agent (to the extent incurred in connection
with any duties as the Lessor or as the Agent), shall be distributed to the
Lessor for its own account in accordance with the amount of such payment or
amount payable to such Person;

               Second, so much of such payments or amounts as shall be required
to pay the Rent Purchasers and the Lessor the amounts payable to them pursuant
to any expense reimbursement or indemnification provisions of the Operative
Documents shall be distributed to each such Rent Purchaser and the Lessor
without priority of one over the other in accordance with the amount of such
payment or payments payable to each such Person;

               Third, to the Rent Purchasers for application to pay in full the
Lease Balance Debt, pro rata among the Rent Purchasers without priority of one
over the other in the proportion that the Participant Balance of each such Rent
Purchaser bears to the aggregate Participant Balances of all Rent Purchasers
and, in the case where the amounts so distributed shall be insufficient to pay
in full as aforesaid, then pro rata among the Rent Purchasers without priority
of one over the other in the proportion that the Participant Balance of each
such Rent Purchaser bears to the aggregate Participant Balances of all Rent
Purchasers;

               Fourth, to the Lessor in an amount equal to the aggregate Lease
Balance Equity shall be distributed to the Lessor for application to the
Participant Balance of the Lessor; and

               Fifth, the balance, if any, of such payment or amounts remaining
thereafter shall be promptly distributed to, or as directed by, the Lessee.

    -   All payments received and amounts realized by the Lessor in connection
        with any Casualty or Condemnation during the continuance of an Event of
        Default shall be distributed by the Lessor as follows:

           -   in the event that the Lessor elects to pay all or a portion of
               such amounts to the Lessee for the repair of damage caused by
               such Casualty or Condemnation, then such amounts shall be
               distributed to the Lessee; and

           -   in the event that the Lessor elects to apply all or a portion of
               such amounts to the purchase price of the Property, then such
               amounts shall be distributed in accordance with clause (a) above.

    -   OTHER PAYMENTS.

    -   Except as otherwise provided in Sections 12.1, 12.2, 12.6 and clause (b)
        below, any payment received by the Lessor for which no provision as to
        the application thereof is made in the Operative Agreements or elsewhere
        in this Section 12 (including any balance remaining after the
        application in full of amounts to satisfy any expressed provision) shall

                                      37.
<PAGE>   39

        be distributed pro rata among the Rent Purchasers and the Lessor without
        priority of one over the other, in the proportion that the Participant
        Balance of each bears to the aggregate of all the Participant Balances.

    -   Except as otherwise provided in Sections 12.1, 12.2 and 12.6, all
        payments received and amounts realized by the Lessor under the Lease or
        otherwise with respect to the Property to the extent received or
        realized at any time after the indefeasible payment in full of the
        Participant Balances of all of the Rent Purchasers and the Lessor and
        any other amounts due and owing to the Rent Purchasers or the Lessor,
        shall be distributed forthwith by the Lessor, in the order of priority
        set forth in Section 12.6(a).

    -   Except as otherwise provided in Sections 12.1 and 12.2, any payment
        received by the Lessor for which provisions as to the application
        thereof is made in an Operative Agreement but not elsewhere in this
        Section 12 shall be distributed forthwith by the Lessor to the Person
        and for the purpose for which such payment was made in accordance with
        the terms of such Operative Agreement.

    -   CASUALTY AND CONDEMNATION AMOUNTS. Subject to Section 12.6(b), any
        amounts payable to and received by the Lessor as a result of a Casualty
        or Condemnation pursuant to Section 15.1 of the Lease shall be
        distributed as follows:

    -   all amounts payable to and received by the Lessee for the repair of
        damage caused by such Casualty or Condemnation in accordance with
        Section 15.1(a) of the Lease shall be distributed to the Lessee; and

    -   all amounts that are to be applied to the purchase price of the Property
        in accordance with Article 16 of the Lease shall be distributed by the
        Lessor upon receipt thereof to the Rent Purchasers and the Lessor in the
        following order of priority:

                      First, to the Rent Purchasers, pro rata, to pay the Lease
        Balance Debt; and

                      Second, to the Lessor to pay the Lease Balance Equity.

    -   ORDER OF APPLICATION. To the extent any payment made to any Rent
        Purchaser or the Lessor pursuant to Sections 12.2, 12.3, 12.4, 12.6 or
        12.7 is insufficient to pay in full the Participant Balance of such Rent
        Purchaser or the Lessor, then each such payment shall first be applied
        to accrued Yield and then to principal on the Rent Purchaser Advances or
        the Lessor Contributions, as applicable.

                                        -
                                   THE LESSOR

    -   DELEGATION OF DUTIES. The Lessor may execute any of its duties hereunder
        or under the other Operative Agreements by or through agents or
        attorneys-in-fact and shall be entitled to advice of counsel concerning
        all matters pertaining to such duties. The Lessor shall not be
        responsible for the negligence or misconduct of any agents or attorneys
        in fact selected by it with reasonable care.

                                      38.
<PAGE>   40

    -   ACTION BY LESSOR. The obligations of the Lessor hereunder and under the
        other Operative Agreements are only those expressly set forth herein and
        therein. Without limiting the generality of the foregoing, the Lessor
        shall not be required to take any action with respect to any Default or
        Event of Default, except as expressly provided herein and in the other
        Operative Agreements.

    -   CONSULTATION WITH EXPERTS. The Lessor may consult with legal counsel
        (who may be counsel for the Lessee, a Rent Purchaser or any Affiliate of
        any of them), independent public accountants and other experts selected
        by it and shall not be liable for any action taken or omitted to be
        taken by it in good faith in accordance with the advice of such counsel,
        accountants or experts.

    -   EXCULPATORY PROVISIONS. Neither the Lessor nor any of its officers,
        directors, employees, agents, attorneys-in-fact or affiliates shall be
        responsible for or have any duty to ascertain, inquire into or verify
        (a) any statement, warranty or representation made in connection with
        the Operative Agreements; (b) the performance or observance of any of
        the covenants or agreements of the Lessee; (c) the satisfaction of any
        condition precedent specified herein or in any other Operative
        Agreement; (d) the validity, effectiveness or genuineness of any of the
        Operative Agreements or any other instrument or writing furnished in
        connection herewith or therewith; (e) the use of the proceeds of any
        Advance; (f) the existence of any Default or Event of Default; or (g)
        the properties, books or records of the Lessee.

    -   RELIANCE ON COMMUNICATIONS. The Lessor shall be entitled to rely, and
        shall be fully protected in relying, upon any note, writing, resolution,
        notice, consent, certificate, affidavit, letter, cablegram, telegram,
        telecopy, telex or teletype message, statement, order or other document
        or conversation reasonably believed by it to be genuine and correct and
        to have been signed, sent or made by the proper Person or Persons and
        upon advice and statements of legal counsel (including, without
        limitation, counsel to the Lessee, independent accountants and other
        experts selected by the Lessor). The Lessor may deem and treat the Rent
        Purchasers as the owners of their respective interests hereunder and
        under the other Operative Agreements for all purposes unless a written
        notice of assignment, negotiation or transfer thereof shall have been
        filed with the Lessor in accordance with Section 10 of this Agreement.
        The Lessor, acting in its capacity as Lessor, shall be fully justified
        in failing or refusing to take any action under this Agreement or under
        any of the other Operative Agreements unless it shall first receive such
        advice or concurrence of the Rent Purchasers as it deems appropriate or
        it shall first be indemnified to its satisfaction by the Rent Purchasers
        against any and all liability and expense which may be incurred by it by
        reason of taking or continuing to take any such action. The Lessor shall
        in all cases be fully protected in acting, or in refraining from acting,
        hereunder or under any of the other Operative Agreements in accordance
        with a request of the Rent Purchasers and such request and any action
        taken or failure to act pursuant thereto shall be binding upon all the
        Rent Purchasers (including their successors and assigns).

    -   NOTICE OF DEFAULT. The Lessor shall not be deemed to have knowledge or
        notice of the occurrence of any Default or Event of Default hereunder
        unless the Lessor has received notice from a Rent Purchaser or the
        Lessee referring to the Operative Agreement, describing such Default or
        Event of Default and stating that such notice is a "notice of

                                      39.
<PAGE>   41

        default." In the event that the Lessor receives such a notice, the
        Lessor shall give prompt notice thereof to the Rent Purchasers. The
        Lessor shall (subject to Section 9.2) take such action with respect to
        such Default or Event of Default as shall be directed by the Majority
        Rent Purchasers; provided that unless and until the Lessor shall have
        received such directions, the Lessor may (but shall not be obligated to)
        take such action, or refrain from taking such action, with respect to
        such Default or Event of Default as it shall deem advisable or in the
        best interest of the Rent Purchasers except to the extent that this
        Agreement expressly requires that such action be taken, or not be taken,
        only with the consent or upon the authorization of the Majority Rent
        Purchasers or all Rent Purchasers.

    -   NON-RELIANCE ON LESSOR AND OTHER PARTICIPANTS. Each Rent Purchaser
        expressly acknowledges that neither the Lessor (other than in its role
        as Participant) nor any of its officers, directors, employees, agents,
        attorneys-in-fact or Affiliates has made any representations or
        warranties to it and that no act by the Lessor or any affiliate thereof
        hereafter taken, including any review of the affairs of the Lessee,
        shall be deemed to constitute any representation or warranty by the
        Lessor to any Participant. Each Participant represents to the Lessor
        that it has, independently and without reliance upon the Lessor or any
        other Participant, and based on such documents and information as it has
        deemed appropriate, made its own appraisal of and investigation into the
        business, assets, operations, property, financial and other conditions,
        prospects and creditworthiness of the Lessee and made its own decision
        to make its proportionate share of the Rent Purchaser Advances hereunder
        and under the other Operative Agreements and enter into this
        Participation Agreement and the other Operative Agreements. Each
        Participant also represents that it will, independently and without
        reliance upon the Lessor or any other Participant, and based on such
        documents and information as it shall deem appropriate at the time,
        continue to make its own credit analysis, appraisals and decisions in
        taking or not taking action under this Participation Agreement, and to
        make such investigation as it deems necessary to inform itself as to the
        business, assets, operations, property, financial and other conditions,
        prospects and creditworthiness of Lessee. Except for notices, reports
        and other documents expressly required to be furnished to the
        Participants by the Lessor hereunder, the Lessor shall not have any duty
        or responsibility to provide any Participant with any credit or other
        information concerning: the business, operations, assets, property,
        financial or other conditions, prospects or creditworthiness of Lessee
        which may come into the possession of the Lessor or any of its officers,
        directors, employees, agents, attorneys-in-fact or affiliates.

    -   FAILURE TO ACT. Except for action expressly required of the Lessor
        hereunder, the Lessor shall in all cases be fully justified in failing
        or refusing to act hereunder unless it shall be indemnified to its
        satisfaction by the Rent Purchasers against any and all liability and
        expense which may be incurred by it by reason of taking or continuing to
        take any such action.

    -   DISTRIBUTIONS. The Lessor shall, as promptly as practicable, distribute
        to each Participant its appropriate portion, if any, of payments
        received (in good, collected funds) by the Lessor from the Lessee for
        the account of the Participants or of any such payments so received for
        the account of such Participant.

                                      40.
<PAGE>   42

                                        -
                                    THE AGENT

    -   APPOINTMENT AND AUTHORIZATION; "AGENT". Each Rent Purchaser hereby
        irrevocably (subject to Section 14.9) appoints, designates and
        authorizes the Agent to take such action on its behalf under the
        provisions of this Agreement and each other Operative Document and to
        exercise such powers and perform such duties as are expressly delegated
        to it by the terms of this Agreement or any other Operative Document,
        together with such powers as are reasonably incidental thereto.
        Notwithstanding any provision to the contrary contained elsewhere in
        this Agreement or in any other Operative Document, the Agent shall not
        have any duties or responsibilities, except those expressly set forth
        herein, nor shall the Agent have or be deemed to have any fiduciary
        relationship with any Rent Purchaser, and no implied covenants,
        functions, responsibilities, duties, obligations or liabilities shall be
        read into this Agreement or any other Operative Document or otherwise
        exist against the Agent. Without limiting the generality of the
        foregoing sentence, the use of the term "agent" in this Agreement with
        reference to the Agent is not intended to connote any fiduciary or other
        implied (or express) obligations arising under agency doctrine of any
        applicable law. Instead, such term is used merely as a matter of market
        custom, and is intended to create or reflect only an administrative
        relationship between independent contracting parties.

    -   DELEGATION OF DUTIES. The Agent may execute any of its duties under this
        Agreement or any other Operative Document by or through agents,
        employees or attorneys-in-fact and shall be entitled to advice of
        counsel concerning all matters pertaining to such duties. The Agent
        shall not be responsible for the negligence or misconduct of any agent
        or attorney-in-fact that it selects with reasonable care.

    -   LIABILITY OF AGENT. Neither the Agent nor any of its officers,
        directors, employees, agents, attorneys-in-fact or affiliates
        (collectively, the "Agent-Related Persons") shall (a) be liable for any
        action taken or omitted to be taken by any of them under or in
        connection with this Agreement or any other Operative Document or the
        transactions contemplated hereby (except for its own gross negligence or
        willful misconduct), or (b) be responsible in any manner to any of the
        Rent Purchasers for any recital, statement, representation or warranty
        made by the Lessee or any Subsidiary or Affiliate of the Lessee, or any
        officer thereof, contained in this Agreement or in any other Operative
        Document, or in any certificate, report, statement or other document
        referred to or provided for in, or received by the Agent under or in
        connection with, this Agreement or any other Operative Document, or the
        validity, effectiveness, genuineness, enforceability or sufficiency of
        this Agreement or any other Operative Document, or for any failure of
        the Lessee or any other party to any Operative Document to perform its
        obligations hereunder or thereunder. No Agent-Related Person shall be
        under any obligation to any Rent Purchaser to ascertain or to inquire as
        to the observance or performance of any of the agreements contained in,
        or conditions of, this Agreement or any other Operative Document, or to
        inspect the properties, books or records of the Lessee or any of the
        Lessee's Subsidiaries or Affiliates.

    -   RELIANCE BY AGENT.

                                      41.
<PAGE>   43

    -   The Agent shall be entitled to rely, and shall be fully protected in
        relying, upon any writing, resolution, notice, consent, certificate,
        affidavit, letter, telegram, facsimile, telex or telephone message,
        statement or other document or conversation believed by it to be genuine
        and correct and to have been signed, sent or made by the proper Person
        or Persons, and upon advice and statements of legal counsel (including
        counsel to the Lessee), independent accountants and other experts
        selected by the Agent. The Agent shall be fully justified in failing or
        refusing to take any action under this Agreement or any other Operative
        Document unless it shall first receive such advice or concurrence of the
        Majority Rent Purchasers as it deems appropriate and, if it so requests,
        it shall first be indemnified to its satisfaction by the Rent Purchasers
        against any and all liability and expense which may be incurred by it by
        reason of taking or continuing to take any such action. The Agent shall
        in all cases be fully protected in acting, or in refraining from acting,
        under this Agreement or any other Operative Document in accordance with
        a request or consent of the Majority Rent Purchasers and such request
        and any action taken or failure to act pursuant thereto shall be binding
        upon all of the Rent Purchasers.

    -   For purposes of determining compliance with the conditions specified in
        Sections 6.1 and 6.2, each Rent Purchaser that has executed this
        Agreement shall be deemed to have consented to, approved or accepted or
        to be satisfied with, each document or other matter either sent by the
        Agent to such Rent Purchaser for consent, approval, acceptance or
        satisfaction, or required thereunder to be consented to or approved by
        or acceptable or satisfactory to the Rent Purchaser.

    -   NOTICE OF DEFAULT. The Agent shall not be deemed to have knowledge or
        notice of the occurrence of any Default or Event of Default, except with
        respect to defaults in the payment of principal, interest and fees
        required to be paid to the Agent for the account of the Rent Purchasers,
        unless the Agent shall have received written notice from a Rent
        Purchaser or the Lessee referring to this Agreement, describing such
        Default or Event of Default and stating that such notice is a "notice of
        default." The Agent will notify the Rent Purchasers of its receipt of
        any such notice. The Agent shall take such action with respect to such
        Default or Event of Default as may be requested by the Majority Rent
        Purchasers in accordance with Section 13.6 hereof; provided, however,
        that unless and until the Agent has received any such request, the Agent
        may (but shall not be obligated to) take such action, or refrain from
        taking such action, with respect to such Default or Event of Default as
        it shall deem advisable or in the best interest of the Rent Purchasers.

    -   CREDIT DECISION. Each Rent Purchaser acknowledges that none of the
        Agent-Related Persons has made any representation or warranty to it, and
        that no act by the Agent hereinafter taken, including any review of the
        affairs of the Lessee and its Subsidiaries, shall be deemed to
        constitute any representation or warranty by any Agent-Related Person to
        any Rent Purchaser. Each Rent Purchaser represents to the Agent that it
        has, independently and without reliance upon any Agent-Related Person
        and based on such documents and information as it has deemed
        appropriate, made its own appraisal of and investigation into the
        business, prospects, operations, property, financial and other condition
        and credit worthiness of the Lessee and its Subsidiaries, and all
        applicable Rent Purchaser regulatory laws relating to the transactions
        contemplated hereby, and made its own decision to enter into this
        Agreement. Each Rent Purchaser also represents that it will,
        independently and without reliance upon any Agent-Related Person and
        based on

                                      42.
<PAGE>   44

        such documents and information as it shall deem appropriate at the time,
        continue to make its own credit analysis, appraisals and decisions in
        taking or not taking action under this Agreement and the other Operative
        Documents, and to make such investigations as it deems necessary to
        inform itself as to the business, prospects, operations, property,
        financial and other condition and credit worthiness of the Lessee.
        Except for notices, reports and other documents expressly herein
        required to be furnished to the Rent Purchasers by the Agent, the Agent
        shall not have any duty or responsibility to provide any Rent Purchaser
        with any credit or other information concerning the business, prospects,
        operations, property, financial and other condition or credit worthiness
        of the Lessee which may come into the possession of any of the
        Agent-Related Persons.

    -   INDEMNIFICATION OF AGENT. Whether or not the transactions contemplated
        hereby are consummated, the Rent Purchasers shall indemnify upon demand
        the Agent-Related Persons (to the extent not reimbursed by or on behalf
        of the Lessee and without limiting the obligation of the Lessee to do
        so), pro rata, from and against any and all Indemnified Liabilities;
        provided, however, that no Rent Purchaser shall be liable for the
        payment to the Agent-Related Persons of any portion of such Indemnified
        Liabilities resulting solely from such Person's gross negligence or
        willful misconduct. Without limitation of the foregoing, each Rent
        Purchaser shall reimburse the Agent upon demand for its ratable share of
        any costs or out-of-pocket expenses (including fees and disbursements of
        any law firm or internal or external counsel) incurred by the Agent in
        connection with the preparation, execution, delivery, administration,
        modification, amendment or enforcement (whether through negotiations,
        legal proceedings or otherwise) of, or legal advice in respect of rights
        or responsibilities under, this Agreement, any other Operative Document,
        or any document contemplated by or referred to herein, to the extent
        that the Agent is not reimbursed for such expenses by or on behalf of
        the Lessee. The undertaking in this Section 14.7 shall survive the
        termination of this Agreement and the resignation or replacement of the
        Agent.

    -   AGENT IN INDIVIDUAL CAPACITY. The Bank of Nova Scotia and its Affiliates
        may make loans to, issue letters of credit for the account of, accept
        deposits from, acquire equity interests in and generally engage in any
        kind of lending, trust, financial advisory, underwriting or other
        business with the Lessee and its Subsidiaries and Affiliates as though
        The Bank of Nova Scotia were not the Agent hereunder and without notice
        to or consent of the Rent Purchasers. The Rent Purchasers acknowledge
        that, pursuant to such activities, The Bank of Nova Scotia or its
        Affiliates may receive information regarding the Lessee or its
        Affiliates (including information that may be subject to confidentiality
        obligations in favor of the Lessee or such Subsidiary) and acknowledge
        that the Agent shall be under no obligation to provide such information
        to them. With respect to its Rent Purchaser Commitment, The Bank of Nova
        Scotia shall have the same rights and powers under this Agreement as any
        other Rent Purchaser and may exercise the same as though it were not the
        Agent, and the terms "Rent Purchaser" and "Rent Purchasers" include The
        Bank of Nova Scotia in its individual capacity.

    -   SUCCESSOR AGENT. The Agent may resign as Agent upon thirty (30) days'
        notice to the Rent Purchasers. If the Agent resigns under this
        Agreement, the Majority Rent Purchasers shall appoint from among the
        Rent Purchasers a successor agent for the Rent Purchasers. If no
        successor agent is appointed prior to the effective date of the
        resignation of the

                                      43.
<PAGE>   45

        Agent, the Agent may appoint, after consulting with the Rent Purchasers
        and the Lessee, a successor agent from among the Rent Purchasers. Upon
        the acceptance of its appointment as successor agent hereunder, such
        successor agent shall succeed to all the rights, powers and duties of
        the retiring Agent and the term "Agent" shall mean such successor agent
        and the retiring Agent's appointment, powers and duties as the Agent
        shall be terminated. After any retiring Agent's resignation hereunder as
        the Agent, the provisions of this Section 14 and Sections 11.1 and 11.2
        shall inure to its benefit as to any actions taken or omitted to be
        taken by it while it was the Agent under this Agreement. If no successor
        agent has accepted appointment as Agent by the date which is thirty (30)
        days following a retiring Agent's notice of resignation, the retiring
        Agent's resignation shall nevertheless thereupon become effective and
        the Rent Purchasers shall perform all of the duties of the Agent
        hereunder until such time, if any, as the Majority Rent Purchasers
        appoint a successor agent as provided for above.

                                       -
                                 MISCELLANEOUS

    -   SURVIVAL OF AGREEMENTS. The representations, warranties, covenants,
        indemnities and agreements of the parties provided for in the Operative
        Agreements, and the parties' obligations under any and all thereof,
        shall survive the execution and delivery of this Agreement, any
        disposition of any interest of the Lessor in the Property or the
        Improvements, the payment of the Rent Purchaser Advances and any
        disposition thereof and shall be and continue in effect notwithstanding
        any investigation made by any party and the fact that any party may
        waive compliance with any of the other terms, provisions or conditions
        of any of the Operative Agreements. Except as otherwise expressly set
        forth herein or in other Operative Agreements, the indemnities of the
        parties provided for in the Operative Agreements shall survive the
        expiration or termination of any thereof.

    -   NO BROKER, ETC. Each of the parties hereto represents to the others that
        it has not retained or employed any broker, finder or financial adviser
        to act on its behalf in connection with this Agreement, nor has it
        authorized any broker, finder or financial adviser retained or employed
        by any other Person so to act except as set forth on SCHEDULE 15.2
        hereto. Any party who is in breach of this representation or who has
        retained or employed a broker, finder or financial advisor shall
        indemnify and hold the other parties harmless from and against any
        liability arising out of such breach of this representation, retainage
        or employment.

    -   NOTICES. Unless otherwise specifically provided herein, all notices,
        consents, directions, approvals, instructions, requests and other
        communications required or permitted by the terms hereof to be given to
        any Person shall be given in writing by nationally recognized courier
        service and any such notice shall become effective one (1) Business Day
        after delivery to a nationally recognized courier service specifying
        overnight delivery and shall be directed to the address of such Person
        as indicated:

               If to the Lessee, to it at:

               Lam Research Corporation
               4650 Cushing Parkway


                                      44.
<PAGE>   46

               Fremont, CA 94538
               Attention: Craig Garber, Treasurer
               Telephone No.:  (510) 572-1875
               Telecopy No.:   (510) 572-1586

               If to the Lessor, to it at:

               Scotiabanc Inc.
               600 Peachtree Street NE, Suite 2700
               Atlanta, Georgia  30308
               Attention:  William Brown, Managing Director
               Telephone No.:  (404) 877-1501
               Telecopy No.:   (404) 888-8998

               If to the Agent, to it at:

               The Bank of Nova Scotia
               580 California Street, Suite 2100
               San Francisco, California  94104
               Attention:  Chris Osborn
               Telephone No.:  (415) 986-1100
               Telecopy No.:   (415) 397-0791

               If to any Rent Purchaser, to it at such address as may be
specified on SCHEDULE 2.1 or otherwise in writing to the other parties hereto.

        From time to time any party may designate a new address for purposes of
notice hereunder by notice to each of the other parties hereto.

    -   COUNTERPARTS. This Agreement may be executed by the parties hereto in
        separate counterparts, each of which when so executed and delivered
        shall be an original, but all such counterparts shall together
        constitute but one and the same instrument.

    -   AMENDMENTS AND TERMINATION. Neither this Agreement nor any of the terms
        hereof may be terminated, amended, supplemented, waived or modified
        except by an instrument in writing signed by the party against which the
        enforcement of the termination, amendment, supplement, waiver or
        modification shall be sought. This Agreement may be terminated by an
        agreement signed in writing by the parties hereto.

    -   HEADINGS, ETC. The Table of Contents and headings of the various
        Sections and Subsections of this Agreement are for convenience of
        reference only and shall not modify, define, expand or limit any of the
        terms or provisions hereof.

    -   PARTIES IN INTEREST. Except as expressly provided herein, none of the
        provisions of this Agreement are intended for the benefit of any Person
        except the parties hereto.

                                      45.
<PAGE>   47

    -   GOVERNING LAW; WAIVER OF JURY TRIAL. THIS AGREEMENT SHALL BE GOVERNED
        BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE
        STATE OF NEW YORK. THE LESSEE, THE AGENT, THE RENT PURCHASERS AND THE
        LESSOR EACH WAIVE THEIR RESPECTIVE RIGHTS TO A TRIAL BY JURY OF ANY
        CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF OR RELATED TO THIS
        AGREEMENT, THE OTHER OPERATIVE DOCUMENTS, OR THE TRANSACTIONS
        CONTEMPLATED HEREBY OR THEREBY, IN ANY ACTION, PROCEEDING OR OTHER
        LITIGATION OF ANY TYPE BROUGHT BY ANY OF THE PARTIES AGAINST ANY OTHER
        PARTY OR ANY PARTICIPANT OR ASSIGNEE, WHETHER WITH RESPECT TO CONTRACT
        CLAIMS, TORT CLAIMS, OR OTHERWISE. THE LESSEE, THE AGENT, THE RENT
        PURCHASERS AND THE LESSOR EACH AGREE THAT ANY SUCH CLAIM OR CAUSE OF
        ACTION SHALL BE TRIED BY A COURT TRIAL WITHOUT A JURY. WITHOUT LIMITING
        THE FOREGOING, THE PARTIES FURTHER AGREE THAT THEIR RESPECTIVE RIGHT TO
        A TRIAL BY JURY IS WAIVED BY OPERATION OF THIS SECTION AS TO ANY ACTION,
        COUNTERCLAIM OR OTHER PROCEEDING WHICH SEEKS, IN WHOLE OR IN PART, TO
        CHALLENGE THE VALIDITY OR ENFORCEABILITY OF THIS AGREEMENT OR THE OTHER
        OPERATIVE DOCUMENTS OR ANY PROVISION HEREOF OR THEREOF. THIS WAIVER
        SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR
        MODIFICATIONS TO THIS AGREEMENT AND THE OTHER OPERATIVE DOCUMENTS.

    -   SEVERABILITY. Any provision of this Agreement that is prohibited or
        unenforceable in any jurisdiction shall, as to such jurisdiction, be
        ineffective to the extent of such prohibition or unenforceability
        without invalidating the remaining provisions hereof, and any such
        prohibition or unenforceability in any jurisdiction shall not invalidate
        or render unenforceable such provision in any other jurisdiction.



    -   LIABILITY LIMITED.

    -   The parties hereto agree that except as specifically set forth herein or
        in any other Operative Agreement, the Lessor shall have no personal
        liability whatsoever to any Participant or their respective successors
        and assigns for any claim based on or in respect hereof or any of the
        other Operative Agreements or arising in any way from the transactions
        contemplated hereby or thereby and recourse, if any, shall be solely had
        against the Lessor's interest in the Property; provided, however, that
        the Lessor shall be liable in its individual capacity (i) for its own
        willful misconduct or gross negligence, (ii) breach of any of its
        representations, warranties or covenants under the Operative Agreements,
        or (c) for any Tax based on or measured by any fees, commission or
        compensation received by it for acting as a Lessor as contemplated by
        the Operative Agreements. It is understood and agreed that, except as
        provided in the preceding sentence: (i) the Lessor shall have no
        personal liability under any of the Operative

                                      46.
<PAGE>   48

        Agreements as a result of acting pursuant to and consistent with any of
        the Operative Agreements; (ii) all obligations of the Lessor to any Rent
        Purchaser are solely nonrecourse obligations except to the extent that
        the Lessor has received the proceeds to the Rent Purchaser Advances);
        and (iii) all such personal liability of the Lessor is expressly waived
        and released as a condition of, and as consideration for, the execution
        and delivery of the Operative Agreements by the Lessor.

    -   No Participant shall have any obligation to any other Participant or to
        Lessee, the Lessor or the Rent Purchasers with respect to transactions
        contemplated by the Operative Agreements, except those obligations of
        such Participant expressly set forth in the Operative Agreements or
        except as set forth in the instruments delivered in connection
        therewith, and no Participant shall be liable for performance by any
        other party hereto of such other party's obligations under the Operative
        Agreements except as otherwise so set forth.

    -   FURTHER ASSURANCES. The parties hereto shall promptly cause to be taken,
        executed, acknowledged or delivered, at the sole expense of the Lessee,
        all such further acts, conveyances, documents and assurances as the
        other parties may from time to time reasonably request in order to carry
        out and effectuate the intent and purposes of this Agreement, the other
        Operative Agreements and the transactions contemplated hereby and
        thereby (including, without limitation, the preparation, execution and
        filing of any and all Uniform Commercial Code financing statements and
        other filings or registrations which the parties hereto may from time to
        time request to be filed or effected). The Lessee, at its own expense,
        shall take such action as may be reasonably requested in order to
        maintain and protect all security interests provided for hereunder or
        under any other Operative Agreement.

    -   SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon and inure
        to the benefit of the parties hereto and their respective successors and
        assigns.

                                        -
                                    RENEWALS

    -   EXTENSIONS OF MATURITY DATE AND EXPIRATION DATE. So long as the Lessee
        has not elected the remarketing option, and no Default or Event of
        Default shall then exist, the Lessee may, not earlier than one (1) year
        before the Maturity Date, direct a written request to the Lessor and the
        Agent that the Expiration Date then in effect under the Lease be
        extended on terms mutually agreeable to Lessor, Agent and Lessee. Any
        such renewal term (each, a "Renewal Term") shall be effective only upon
        the consent of all Participants and each Participant may grant or deny
        its consent to a renewal of the Lease in its sole discretion.


                                      47.
<PAGE>   49


        IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective officers thereunto duly authorized as of the
day and year first above written.

                                          LAM RESEARCH CORPORATION,
                                          as Lessee



                                          By:    /s/ Craig Garber
                                                 -------------------------------

                                          Name:  Craig Garber
                                                 -------------------------------

                                          Title: Treasurer
                                                 -------------------------------


                            [PARTICIPATION AGREEMENT]


<PAGE>   50

                                          SCOTIABANC INC.,
                                          as Lessor


                                          By:    /s/ F.C.H. Ashby
                                                 -------------------------------

                                          Name:  F.C.H. Ashby
                                                 -------------------------------

                                          Title: Senior Manager, Loan Operations
                                                 -------------------------------
<PAGE>   51
                                        THE BANK OF NOVA SCOTIA,
                                        as Agent


                                        By:  /s/ Chris Osborn
                                             -------------------------
                                        Name: Chris Osborn
                                             -------------------------
                                        Title: Director
                                              ------------------------

                                        THE BANK OF NOVA SCOTIA,
                                        as a Rent Purchaser

                                        By:  /s/ Chris Osborn
                                             -------------------------
                                        Name: Chris Osborn
                                             -------------------------
                                        Title: Director
                                              ------------------------




                           [PARTICIPATION AGREEMENT]
<PAGE>   52
                                  SCHEDULE 2.1

                               LESSOR COMMITMENT

<TABLE>
<CAPTION>
                                            Amount of Lessor
  Name and Address of Lessor                      Commitment
----------------------------                ----------------
<S>                                          <C>
        Scotiabanc Inc.
600 Peachtree Street NE, Suite 2700
Atlanta, Georgia 30308                       $3,203,249.86

</TABLE>


                           RENT PURCHASER COMMITMENT

<TABLE>
<CAPTION>
                                                   Amount of Rent
Name and Address of Rent Purchaser           Purchaser Commitment
----------------------------------           --------------------
<S>                                          <C>
  The Bank of Nova Scotia
  580 California Street
  San Francisco, California 94104            $23,942,935.39

</TABLE>



<PAGE>   53
                                  SCHEDULE 2.6

                              Payment Instructions



FOR THE BANK OF NOVA SCOTIA:

The Bank of Nova Scotia
New York Agency
1 Liberty Plaza
New York, NY
ABA # 026002532
Credit Account # 0610135
BNS San Francisco -- Loan Service
Reference -- Lam Research Corporation

FOR SCOTIABANC INC.:

The Bank of Nova Scotia
New York Agency
1 Liberty Plaza
New York, NY
ABA # 026002532
Credit Account # 0735639
Scotiabanc Inc.
Reference -- Lam Research Corporation
<PAGE>   54
                                   SCHEDULES

Schedule 2.1        Lessor Commitment and Rent Purchaser Commitments
Schedule 2.6        Payment Instructions
Schedule 7.2        Exceptions to Representations and Warranties of the Lessee
Schedule 15.2            Brokers, Finders and Financial Advisors


                                    EXHIBITS

Exhibit A           Form of Pledge Agreement
Exhibit B           Form of Assignment and Acceptance
Exhibit C           Form of Officer's Certificate
<PAGE>   55
                               TABLE OF CONTENTS
<TABLE>
<CAPTION>
                                                                            PAGE
                                                                            ----
<S>                                                                         <C>
SECTION 1 THE RENT PURCHASE...................................................1
SECTION 2 LESSOR CONTRIBUTIONS................................................2
  2.1  Lessor Contributions...................................................2
  2.2  Yield..................................................................2
  2.3  Interest Period Selection Elections....................................3
  2.4  Prepayments............................................................4
  2.5  Fees...................................................................4
  2.6  Payments...............................................................4
SECTION 3 SUMMARY OF THE TRANSACTIONS.........................................4
  3.1  Operative Agreements...................................................4
  3.2  Property Acquisition and Lease.........................................4
SECTION 4 THE CLOSING.........................................................5
SECTION 5 FUNDING OF ADVANCES.................................................5
  5.1 General.................................................................5
  5.2  Procedures for Funding.................................................5
  5.4  Pledged Collateral.....................................................6
SECTION 6 CONDITIONS OF THE CLOSING AND ADVANCES..............................7
  6.1  General Conditions to the Closing Date.................................7
  6.2  Conditions to Rent Purchasers' and Lessor's Obligations to
       Make Rent Purchaser Advances and Lessor Contributions..................9
SECTION 7 REPRESENTATIONS AND WARRANTIES.....................................10
  7.1  Representations and Warranties of the Lessor on the Closing Date......10
  7.2  Representations and Warranties of the Lessee on the Closing Date
       and the Funding Date..................................................12
SECTION 8 PAYMENT OF CERTAIN EXPENSES........................................17
  8.1  Transaction Expenses..................................................17
  8.2  Brokers' Fees and Stamp Taxes.........................................17
  8.3  Certain Fees and Expenses.............................................17
  8.4  Commitment Fee........................................................17
SECTION 9 OTHER COVENANTS AND AGREEMENTS.....................................18
  9.1  Cooperation with the Lessee...........................................18
  9.2  Covenants of the Lessor...............................................18
  9.3  Covenants of the Lessee...............................................19
SECTION 10 TRANSFER OF INTEREST..............................................23
 10.1  Assignments...........................................................23
 10.2  Participations........................................................24
 10.3  Disclosure of Information; Pledge Under Regulation A. ................24
SECTION 11 INDEMNIFICATION...................................................25
 11.1  General Indemnity.....................................................25
</TABLE>






                                       i.
<PAGE>   56

                               TABLE OF CONTENTS
                                  (CONTINUED)

<TABLE>
<CAPTION>
                                                                            PAGE
                                                                            ----
<S>                                                                         <C>
     11.2   General Impositions Indemnity....................................26
     11.3   LIBOR Lending Unlawful...........................................30
     11.4   Deposits Unavailable.............................................31
     11.5   Increased Costs, etc.............................................31
     11.6   Funding Losses...................................................33
     11.7   Capital Adequacy.................................................33
SECTION 12  DISTRIBUTION.....................................................34
     12.1   Basic Rent.......................................................34
     12.2   Purchase Payments by the Lessee..................................34
     12.3   Payment of Lease Balance Debt....................................34
     12.4   Sales Proceeds of Remarketing of Property........................35
     12.5   Supplemental Rent................................................35
     12.6   Distribution of Payments after Event of Default..................35
     12.7   Other Payments...................................................36
     12.8   Casualty and Condemnation Amounts................................36
     12.9   Order of Application.............................................37
SECTION 13  THE LESSOR.......................................................37
     13.1   Delegation of Duties.............................................37
     13.2   Action by Lessor.................................................37
     13.3   Consultation with Experts........................................37
     13.4   Exculpatory Provisions...........................................37
     13.5   Reliance on Communications.......................................38
     13.6   Notice of Default................................................38
     13.7   Non-Reliance on Lessor and Other Participants....................38
     13.8   Failure to Act...................................................39
     13.9   Distributions....................................................39
SECTION 14  THE AGENT........................................................39
     14.1   Appointment and Authorization; "Agent"...........................39
     14.2   Delegation of Duties.............................................39
     14.3   Liability of Agent...............................................40
     14.4   Reliance by Agent................................................40
     14.5   Notice of Default................................................40
     14.6   Credit Decision..................................................41
     14.7   Indemnification of Agent.........................................41
     14.8   Agent in Individual Capacity.....................................42
     14.9   Successor Agent..................................................42
SECTION 15  MISCELLANEOUS....................................................42
     15.1   Survival of Agreements...........................................42
     15.2   No Broker, etc...................................................42
</TABLE>

                                      ii.
<PAGE>   57
                               TABLE OF CONTENTS
                                  (CONTINUED)

<TABLE>
<CAPTION>
                                                                 PAGE
<S>                                                              <C>
   15.3   Notices..............................................   43
   15.4   Counterparts.........................................   44
   15.5   Amendments and Termination...........................   44
   15.6   Headings, etc........................................   44
   15.7   Parties in Interest..................................   44
   15.8   Governing Law; Waiver Of Jury Trial..................   44
   15.9   Severability.........................................   44
   15.10  Liability Limited....................................   45
   15.11  Further Assurances...................................   45
   15.12  Successors and Assigns...............................   45

SECTION 16  RENEWALS...........................................   45
   16.1   Extensions of Maturity Date and Expiration Date......   45
</TABLE>



                                      iii.