SECOND MODIFICATION AGREEMENT



     SECOND  MODIFICATION  AGREEMENT ("SECOND  MODIFICATION  AGREEMENT") ENTERED
     INTO AS OF THE 29th OF JUNE, 2000 BY AND BETWEEN KABLE NEWS COMPANY,  INC.,
     AN  ILLINOIS  CORPORATION  ("BORROWER"),  AMREP  CORPORATION,  AN  OKLAHOMA
     CORPORATION  ("PARENT"),  KABLE NEWS EXPORT,  LTD, A DELAWARE  CORPORATION,
     KABLE NEWS  COMPANY OF CANADA LTD, AN ONTARIO,  CANADA  CORPORATION,  KABLE
     NEWS  INTERNATIONAL,   INC.,  A  DELAWARE  CORPORATION,  KABLE  FULFILLMENT
     SERVICES OF OHIO, INC., A DELAWARE  CORPORATION  (COLLECTIVELY  REFERRED TO
     HEREIN  AS  "ORIGINAL  SUBSIDIARIES")  AND  DISTRIBUNET  INC.,  A  DELAWARE
     CORPORATION  ("DISTRIBUNET")  AND  MAGAZINE  CONNECTION  INC.,  A  DELAWARE
     CORPORATION ("CONNECTION")  (DISTRIBUNET AND CONNECTION COLLECTIVELY,  "NEW
     SUBSIDIARIES" AND ORIGINAL  SUBSIDIARIES AND NEW SUBSIDIARIES  COLLECTIVELY
     REFERRED  TO  AS   "SUBSIDIARIES")   (BORROWER,   PARENT  AND  SUBSIDIARIES
     COLLECTIVELY  REFERRED  TO HEREIN AS  "BORROWING  PARTIES"),  AND  AMERICAN
     NATIONAL BANK AND TRUST  COMPANY OF CHICAGO  ("AGENT"),  HELLER  FINANCIAL,
     INC. ("HELLER"), MERRILL LYNCH BUSINESS FINANCIAL SERVICES INC. ("MERRILL")
     AND FIRST  BANK  ("FIRST  BANK")  (AGENT,  HELLER,  MERRILL  AND FIRST BANK
     COLLECTIVELY REFERRED TO HEREIN AS "LENDERS")

                               W I T N E S S E T H

     WHEREAS,  Borrower and Lenders have  executed  that certain Loan  Agreement
dated September 15, 1998 ("Loan Agreement")  relating to certain Loans ("Loans")
made by  Lenders  to  Borrower,  to wit,  a certain  Forty  Million  and  No/100
($40,000,000.00) Dollar Secured Revolving Credit Facility, a certain One Million
Two Hundred Thousand and No/100  ($1,200,000.00)  Dollar Secured Term Loan and a
certain One Million Five  Hundred  Thousand  and No/100  ($1,500,000.00)  Dollar
Secured Term Loan; and
<PAGE>

     WHEREAS, the Loans are evidenced by Notes (the "Notes") all dated September
15, 1998 executed by Borrower and delivered to the Lenders; and

     WHEREAS,  in  connection  with  the  Loans,   Borrower  and  each  Original
Subsidiary  have  executed  and  delivered  those  certain  Security  Agreements
("Security Agreements") all dated September 15, 1998; and

     WHEREAS, in connection with the Loans,  Borrower has executed and delivered
that certain Trademark Collateral  Assignment and Security Agreement ("Trademark
Assignment") dated September 15, 1998; and

     WHEREAS,  in connection with the Loans, Parent and each Original Subsidiary
have executed and delivered those certain  Guaranties  ("Guaranties")  all dated
September 15, 1998; and

     WHEREAS,  in connection  with the Loans,  Parent has executed and delivered
that certain Stock Pledge  Agreement  ("Stock Pledge") dated September 15, 1998;
and

     WHEREAS,  Borrower,  Original  Subsidiaries  and Lenders have executed that
certain  Modification   Agreement  relating  to  the  Loans  (the  "Modification
Agreement") dated July 7, 1999 (the Loan Agreement,  Notes, Security Agreements,
Guaranties, Stock Pledge, all as modified by the Modification Agreement and this
Second  Modification  Agreement,  and the  hereafter  defined  New  Subsidiarys'
Security Agreements and New Subsidiarys' Guaranties are collectively referred to
herein as the "Loan Documents"); and

     WHEREAS,  Borrower has formed  Distribunet  and is desirous of amending the
Loan Documents in order to allow Distribunet  (a)to become a limited partner of
and to  invest in two  certain  Limited  Partnerships,  to wit  Magazinet,  L.P.
("Magazinet"),  a Delaware limited partnership and Senequier  Holdings,  L.P., a
Texas limited Partnership  ("Senequier")  (Magazinet and Senequier  collectively
referred to as the  "Partnerships"),  and  (b)invest  in and become a member of
Magazinet   Management,   L.L.C.,   a   Delaware   limited   liability   company
("Management"), the general partner of Magazinet; and

     WHEREAS, Borrower has also formed Connection in order to engage in the sale
of magazines directly to retail sellers of same.

     WHEREAS,  Lenders have agreed to permit the  investments  and to modify the
Loan  Documents  in  accordance  with  the  terms  of this  Second  Modification
Agreement conditioned on the terms contained herein including but not limited to
the delivery to Lenders of Security  Agreements executed by the New Subsidiaries
(the "New Subsidiarys'  Security Agreements") and Guaranties executed by the New
Subsidiaries (the "New Subsidiarys' Guaranties").

     NOW,  THEREFORE,  in  consideration  of the mutual  premises of the parties
hereto,  and  for  other  good  and  valuable  consideration,  the  receipt  and
sufficiency of which is hereby acknowledged,

                                       2
<PAGE>

         IT IS AGREED:

     1. Preambles. The preambles to this Agreement are fully incorporated herein
by this  reference  thereto  with the same force and  effect as though  restated
herein.

     2.  Defined  Terms.  To the  extent  not  otherwise  defined  herein to the
contrary, all capitalized terms and/or phrases used in this Agreement shall have
the respective meanings assigned to them in the Loan Documents.

     3.  Modification  of Loan Agreement.  Borrowing  Parties and Lenders hereby
agree that the Loan Agreement be and hereby is modified as follows:

               (a)  Distribunet,  Inc., a Delaware corporation  ("Distribunet"),
                    and  Magazine  Connection,   Inc.,  a  Delaware  corporation
                    ("Connection")   are  hereby  added  to  the  definition  of
                    "Borrower Entities";
               (b)  The  Security  Agreement  of  even  date  with  this  Second
                    Modification  Agreement  executed by Distribunet in favor of
                    Agent for the ratable benefit of the Lenders as amended from
                    time to time (the "Distribunet  Security Agreement") and the
                    Security   Agreement   of  even  date   with   this   Second
                    Modification  Agreement  executed by  Connection in favor of
                    Agent for the ratable benefit of the Lenders as amended from
                    time to  time  (the  "Connection  Security  Agreement")  are
                    hereby   added  to  the   definition   of  the   "Collateral
                    Documents";
               (c)  Distribunet   and   Connection   are  hereby  added  to  the
                    definition of "Guarantors";
               (d)  The  Guaranty  of even date with  this  Second  Modification
                    Agreement executed by Distribunet  ("Distribunet  Guaranty")
                    and the Guaranty of even date with this Second  Modification
                    Agreement executed by Connection (the "Connection Guaranty")
                    are  hereby   added  to  the   definition   of   "Subsidiary
                    Guaranties";
               (e)  Distribunet   and   Connection   are  hereby  added  to  the
                    definition of "Subsidiary Guarantors");
               (f)  Section  6.21 of the Loan  Agreement  is hereby  restated to
                    read:

                    "6.21 Business Activities. The Borrower and its Subsidiaries
                    will not  engage  in any  type of  business  except  (a) the
                    businesses  in which they were  engaged  on April 30,  1998,
                    including,   without   limitation,   the   distribution   of
                    paperbacks,  magazines and related products;  product, order
                    and  subscription   processing  and  fulfillment;   customer
                    service;    telemarketing   and   related   services;    (b)
                    distribution   of  magazines  in  connection   with  and  as
                    contemplated under that certain Investment Agreement between
                    Borrower,   Senequier   Holdings,   L.P.,  a  Texas  limited
                    partnership,  Distribunet  and Mags2Go,  L.L.C.,  a Delaware
                    limited  liability  company and (c) supplying  magazines and
                    other periodicals to retail sellers.  However,  Borrower may
                    become engaged in the  publishing  business if such business
                    does not at any time  account for  greater  than ten percent
                    (10%) of Borrower's  revenues on an annual basis."

                                       3
<PAGE>

     Borrowing  Parties further agree that the provisions of Section 6.22 of the
Loan Agreement  apply with equal force and effect to Distribunet  and Connection
and that in further  consideration of Lenders executing this Second Modification
Agreement  Borrower  shall  also  make  available  and loan to  Distribunet  and
Connection portions of any Advances relating to the Revolving Loan to be used by
Distribunet  and  Connection  for  working  capital  purposes.  Distribunet  and
Connection  by their  execution of this Second  Modification  hereby join in the
Certificate of  Acknowledgment  and Pledge  attached to the Loan Agreement as if
they were an original signatory thereto and hereby grants a security interest in
favor  of  Borrower  in and to all  presently  existing  and  hereafter  arising
accounts,  inventory,  equipment, general intangibles,  instruments,  investment
securities and chattel paper of  Distribunet  and Connection and the proceeds of
all of the  foregoing  to secure all  amounts  advanced  and/or  lent to them by
Borrower pursuant to said Section 6.22. Borrower by its execution of this Second
Modification  Agreement hereby assigns all the foregoing together with all loans
made in  connection  therewith to  Distribunet  and  Connection to Agent for the
ratable  benefit  of  the  Lenders  to  further  secure  the  repayment  of  the
Obligations.

     4. Limited Waiver of Sections 6.14 and 6.17 of the Loan Agreement.  Lenders
by their  execution  hereof  hereby  waive  the  provisions  of  Sections  6.14,
Investments  and  Acquisitions,  of the Loan Agreement but only as it applies to
Investments,  as  said  term  is  hereafter  defined,  in the  Partnerships  and
Management,  and Section 6.17, Affiliates,  of the Loan Agreement but only as it
applies to the services provided by Distribunet and Borrower to the Partnerships
and the services  provided by Magazinet to Borrower or  Borrower's  Subsidiaries
upon the following terms and conditions:

               (i) Provided there does not exist a Default or an event but which
          for the  passage  of time or giving of notice  would be a Default  and
          provided further that the making of any Investments  would not cause a
          breach of any of the Financial  Covenants contained in Section 6.24 of
          the Loan Agreement,  Borrower and Borrower's  Subsidiaries  are hereby
          permitted  to make  Investments  in the  Partnerships  and  Management
          provided that the  outstanding  amounts of all  Investments  shall not
          exceed the following dollar limitations (the "Investment Caps") at any
          time  during  the  following  time  periods  (the   "Investment   Time
          Periods").

          Investment Cap  Investment Time Period
          --------------  ----------------------
              $2,000,000  during  the  period  from  the  date of  this  Second
                          Modification Agreement to and including April 30, 2001

              $5,000,000  from May 1, 2001 to and including April 30, 2002

              $8,000,000  from May 1, 2002 to and including April 30, 2003

              $10,000,000 from May 1, 2003 to and including April 30, 2004

                                       4
<PAGE>

          As used in this paragraph,  the term  "Investments"  means any and all
          (a)capital  contributions  made by Borrower or any of its Subsidiaries
          in the form of cash or  property  for any  purpose  to  either  of the
          Partnerships  or Management,  plus (b)loans made by Borrower or any of
          its  Subsidiaries  for any  purpose to either of the  Partnerships  or
          Management,  plus (c)any guaranty of any debt of either Partnership or
          Management,  by Borrower or any of its Subsidiaries,  plus (d)a pledge
          of any assets of  Borrower  or any of its  Subsidiaries  to secure any
          debt of  either  Partnership  or  Management,  plus  (e) cash  paid or
          property transferred by Borrower or any of its Subsidiaries to acquire
          any  ownership  interest  in or the  right to  acquire  any  ownership
          interest in either  Partnership or Management,  plus (f) cash advances
          made by  Borrower  or any of its  Subsidiaries  to  Magazinet  to fund
          operating  losses of  Magazinet  plus (g) any  liability  incurred  by
          Borrower under any Kable Sharing  Agreement as said term is defined in
          the Senequier Partnership Agreement. The determination of the value of
          any property used in calculating the amount of the  Investments  shall
          be done by Agent in its sole  discretion.  Borrowing  Parties  further
          agree that (a) in connection with all other matters to be shown on the
          Monthly  Compliance  Certificate  attached  as  Exhibit G  to the Loan
          Agreement  that there also shall be shown thereon in a form and detail
          acceptable to Lender the amounts of all outstanding  Investments as of
          the date of each  Compliance  Certificate,  and (b) if the  applicable
          Investment  Cap is exceeded by Borrower  and  Borrower's  Subsidiaries
          same shall be considered a Default under the Loan  Agreement.

                         (ii) To the extent the prohibition contained in Section
                    6.17  of  the  Loan   Agreement   prohibits   Borrower   and
                    Distribunet  from providing  services to the Partnerships or
                    prevents  Magazinet from  providing  services to Borrower or
                    any Subsidiary of Borrower  "upon fair and reasonable  terms
                    no less  favorable to Borrower or such  Subsidiary  than the
                    Borrower or such  Subsidiary  would  obtain in a  comparable
                    arms-length  transaction"  said prohibition is hereby waived
                    in   connection   with  the   services  to  be  supplied  by
                    Distribunet or Borrower to the  Partnerships or the services
                    to be  supplied  by  Magazinet  to  Borrower  or  Borrower's
                    Subsidiaries.

     5.  Modification  of Security  Agreement  executed by  Borrower.  Borrowing
Parties  and  Lenders  hereby  agree that the  Security  Agreement  executed  by
Borrower  be and hereby is  modified  to add to Item G of  Schedule I  contained
therein the following:

                                       5
<PAGE>

<TABLE>
<S>             <C>             <C>          <C>                <C>                     <C>

Issuer          Class of Stock  # of Shares  Certificate Number % of Outstanding Shares Par Value
------          --------------  -----------  ------------------ ----------------------- ---------
Distribunet Inc.,
a Delaware
corporation         Common         1000              1                 100%                 .01

Magazine Connection
Inc., a Delaware
corporation         Common         1000              1                 100%                 .01
</TABLE>


     6.  Conditions   Precedent.   Lenders'  execution  of  the  present  Second
Modification  Agreement and its agreement to the terms and conditions  hereof is
expressly  conditioned on the delivery to Agent of the following  documents in a
form and content acceptable to Agent and its counsel:

          (a) The executed New Subsidiarys' Security Agreements.

          (b) The executed New Subsidiarys' Guaranties.

          (c) UCC-1  Financing  Statements  executed by  Distribunet in favor of
     Agent for filing in New York.

          (d) UCC-1  Financing  Statement  executed by  Distribunet  in favor of
     Borrower and assigned to Agent for filing in New York.

          (e) UCC-1 Financing Statement executed by Connection in favor of Agent
     for filing in New York.

          (f) UCC-1  Financing  Statement  executed  by  Connection  in favor of
     Borrower and assigned to Agent for filing in New York.

          (g) UCC-3 Financing  Statement  executed by Borrower in favor of Agent
     for filing in Illinois.

          (h)  Executed  copy of the amended and  restated  limited  partnership
     agreement of Senequier (The "Senequier Partnership Agreement").

          (i) Executed copy of the limited partnership agreement of Magazinet.

          (j)  Original  stock  certificate  representing  all  the  issued  and
     outstanding  stock of  Distribunet  together  with stock power  executed by
     Borrower.

          (k)  Original  stock  certificate  representing  all  the  issued  and
     outstanding  stock of  Connection  together  with stock  power  executed by
     Borrower.

          (l) Certificate of Goodstanding for Distribunet issued by the Delaware
     Secretary of State.

                                       6
<PAGE>

          (m) Certificate of Goodstanding for Connection  issued by the Delaware
     Secretary of State.

          (n)  Certificate  of  Existence  for  Senequier  executed by the Texas
     Secretary of State.

          (o)  Certificate of Goodstanding  issued by the Delaware  Secretary of
     State for Management.

          (p)  Certificate  of  Existence  issued by the  Secretary  of State of
     Delaware for Magazinet.

          (q)  Secretary's  Certificate  for  Distribunet  certifying  as to (i)
     attached  certified  copy  of  Articles  of  Incorporation,  (ii)  attached
     By-Laws, (iii) authorized incumbent officers, and (iv) attached resolutions
     of Board of Directors.

          (r)  Secretary's  Certificate  for  Connection  certifying  as to  (i)
     attached  certified  copy  of  Articles  of  Incorporation,  (ii)  attached
     By-Laws, (iii) authorized incumbent officers, and (iv) attached resolutions
     of Board of Directors.

          (s) Secretary's  Certificate for Borrower,  Parent and each Subsidiary
     certifying  as to (i)  authorized  incumbent  officers  and  (ii)  attached
     resolution of Board of Directors.

          (t) Notice,  Acknowledgment  and Consent  executed by Distribunet  and
     Senequier.

          (u) Notice,  Acknowledgment  and Consent  executed by Distribunet  and
     Magazinet.

          (v) Notice,  Acknowledgment  and Consent  executed by Distribunet  and
     Mags2Go, L.L.C., a Delaware limited liability company.

          (w) Copy of executed  Retail Supply  Agreement  between  Magazinet and
     Senequier.

          (x) Copy of executed Interim Services  Agreement  between Borrower and
     Magazinet.

          (y) Copies of all Supply  Agreements  executed  by any  Subsidiary  of
     Borrower with Magazinet.

          (z)  Copy  of  executed  Limited   Liability   Company   Agreement  of
     Management.

          (aa)  Copy  of  executed   Investment   Agreement  between  Senequier,
     Borrower,  Distribunet and Mags2Go,  L.L.C., a Delaware  limited  liability
     company.

          (bb) Copy of executed  Registration Rights Agreement between Senequier
     and Distribunet.

          (cc) Opinion letter of counsel to Borrowing Parties.

                                       7
<PAGE>

     7. Other Loan Document Modifications.  All Loan Documents are hereby deemed
amended  and  modified  to  provide  that  any and all  references  to any  Loan
Documents  therein are hereby deemed to be references to said Loan  Documents as
modified by this Agreement.

     8. Other Documents.  At Agent's request, the Borrowing Parties hereby agree
to execute and deliver  promptly to Agent such other  documents as Agent, in its
reasonable  discretion,  shall deem  necessary  or  appropriate  to evidence the
transactions contemplated herein.

     9.  Reaffirmation.  The Borrowing Parties do hereby reaffirm each and every
covenant,  condition,  obligation and provision set forth in the Loan Documents,
as modified hereby. The Borrowing Parties hereby restate and reaffirm all of the
warranties  and  representations  contained in the Loan  Documents,  as modified
hereby, as being true and correct as of the date hereof.

     10. References. All references herein to any of the Loan Documents shall be
understood to be to the Loan Documents as modified hereby. All references in any
of the Loan  Documents  to any  other  one or more of the Loan  Documents  shall
hereafter be deemed to be to such document(s) as modified hereby.

     11. No Defense,  Counterclaims.  Each Borrowing Party hereby represents and
warrants to, and covenants  with,  Lenders that as of the date hereof,  (a) each
Borrowing Party has no defenses,  offsets or counterclaims of any kind or nature
whatsoever  against  any  Lender  with  respect  to the Loans or any of the Loan
Documents,  or any  action  previously  taken or not  taken by any  Lender  with
respect thereto or with respect to any security interest,  encumbrance,  lien or
collateral in connection  therewith to secure the  liabilities of each Borrowing
Party,  and (b) that the Lenders have fully  performed all  obligations  to each
Borrowing Party which it may have had or has on and of the date hereof.

     12.  Release.  Without  limiting  the  generality  of the  foregoing,  each
Borrowing  Party,  on its own behalf  and on the behalf of its  representatives,
partners,   shareholders,   subsidiaries,   affiliated  and  related   entities,
successors and assigns (hereinafter  collectively  referred to as the "Borrowing
Group" and as to the  Borrowing  Group,  each  Borrowing  Party  represents  and
warrants  that it has the  right,  power and  authority  to waive,  release  and
forever  discharge  on  behalf  of the  Borrowing  Group,  the  "Bank  Group" as
hereinafter  defined) waives,  releases and forever  discharges each Lender, and
their  respective  officers,  directors,  subsidiaries,  affiliated  and related
companies   or   entities,    agents,   servants,    employees,    shareholders,
representatives,   successors,  assigns,  attorneys,   accountants,  assets  and
properties,  as the case may be (together  hereinafter  referred to as the "Bank
Group")  from and  against  all manner of  actions,  cause and causes of action,
suits, debts, sums of money, accounts,  reckonings,  bonds, bills,  specialties,
covenants,   contracts,   controversies,   agreements,   promises,  obligations,
liabilities, costs, expenses, losses, damages, judgments, executions, claims and
demands,  of whatsoever  kind or nature,  in law or in equity,  whether known or
unknown,  whether or not concealed or hidden,  arising out of or relating to any
matter,  cause or thing whatsoever,  that any of the Borrowing Group, jointly or
severally, may have had, or now have or that may subsequently accrue against the
Bank Group by reason of any matter or thing whatsoever  arising out of or in way
connected  to,  directly,  or  indirectly,  the  Loans  and/or  any of the  Loan
Documents through the date hereof,  Each Borrowing Party acknowledges and agrees
that  Lenders are  specifically  relying upon the  representations,  warranties,
covenants  and  agreements  contained  herein  and  that  such  representations,
warranties,  covenants and agreements  constitute a material inducement to enter
into this Agreement.

                                       8
<PAGE>

     13. No Custom.  This Agreement shall not establish a custom or waive, limit
or condition the rights and remedies of Lenders under the Loan Documents, all of
which rights and remedies are expressly reserved.

     14.  Reaffirmation  of  Loan  Documents,  No  Novation.  Except  as  may be
expressly  set  forth  herein  to  the  contrary,   the  Loan  Documents  remain
unmodified,  and all other terms and conditions thereof remain in full force and
effect.  Notwithstanding  anything to the contrary  contained herein,  Borrowing
Parties and Lenders expressly state, declare and acknowledge that this Agreement
is intended only to modify each Borrowing Party's continuing  obligations in the
manner  set forth  herein,  and is not  intended  as a  novation  of any and all
amounts presently due and owing from any Borrowing Party to Lenders.

     15. Captions; Counterparts. The captions used herein are for convenience of
reference only and shall not be deemed to limit or affect the  construction  and
interpretation  of the terms of this Agreement.  This Agreement may be signed in
counterparts,  each of which shall be deemed an original  and all of which shall
be deemed one Agreement.

     16. Choice of Law and  Severability.  This Agreement  shall be governed and
construed  under the laws of the State of  Illinois.  If any  provision  of this
Agreement is held invalid or unenforceable, the remainder of this Agreement will
not be affected  thereby and the provisions of this Agreement shall be severable
in any such instance.

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

                                       KABLE NEWS COMPANY, INC.,
                                       an Illinois corporation

                                       By: /s/ Daniel Friedman
                                       Title: Chairman President & CEO


                                       9
<PAGE>


LENDERS:

AMERICAN NATIONAL BANK AND
TRUST COMPANY OF CHICAGO,
Individually and as Agent


By: /s/ Robin Winer
Title: V.P.



HELLER FINANCIAL, INC.


By: /s/ Dennis Graham
Title: Assistant Vice President


MERRILL LYNCH BUSINESS
FINANCIAL SERVICES INC.


By: /s/ Michael J. Wiers
Title: VP



FIRST BANK


By: /s/ Thomas J. Huffman
Title: Regional President



PARENT:

AMREP CORPORATION, an Oklahoma corporation


By: /s/ Daniel Friedman
Title: Senior Vice President


SUBSIDIARIES:

KABLE NEWS EXPORT, LTD,
a Delaware corporation

By: /s/ Daniel Friedman
Title: Chairman President & CEO


KABLE NEWS COMPANY OF CANADA LTD, an Ontario, Canada corporation

By: /s/ Daniel Friedman
Title: President & CEO


KABLE NEWS INTERNATIONAL, INC., a Delaware corporation

By: /s/ Daniel Friedman
Title: President


KABLE FULFILLMENT SERVICES OF OHIO, INC., a Delaware corporation

By: Daniel Friedman
Title: Chairman & CEO


NEW SUBSIDIARIES:

DISTRIBUNET INC., a Delaware corporation

By: /s/ Michael Duloc
Title: President


MAGAZINE CONNECTION INC., a Delaware corporation

By: /s/ Michael Duloc
Title: President


                                       10
<PAGE>