<PAGE>

                                                                   EXHIBIT 10.39




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





                     MADISON THIRD BUILDING COMPANIES, LLC,



                                                                       Landlord,



                             CONSTELLATION 3D, INC.



                                                                       Tenant.





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


                                      LEASE


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




Premises:         805 Third Avenue
                  Part of 14th Floor
                  New York, New York 10022
<PAGE>

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

<TABLE>
<CAPTION>
Article                                                                                                         Page
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<S>                                                                                                              <C>
   1.             Premises; Term..................................................................................1
   2.             Commencement of Term............................................................................1
   3.             Rent............................................................................................2
   4.             Use.............................................................................................3
   5.             Alterations, Fixtures...........................................................................5
   6.             Repairs.........................................................................................8
   7.             Floor Load; Noise...............................................................................9
   8.             Laws, Ordinances, Requirements of Public
                    Authorities...................................................................................9
   9.             Insurance......................................................................................10
  10.             Damage by Fire or Other Cause..................................................................13
  11.             Assignment, Subletting, Mortgaging.............................................................14
  12.             Liability of Landlord and Indemnity by Tenant..................................................20
  13.             Moving of Heavy Equipment......................................................................22
  14.             Condemnation...................................................................................23
  15.             Entry, Right to Change Public Portions
                    of the Building..............................................................................24
  16.             Conditional Limitations, Etc...................................................................25
  17.             Mechanic's Liens...............................................................................29
  18.             Landlord's Right to Perform Tenant's
                    Obligations..................................................................................30
  19.             Covenant of Quiet Enjoyment....................................................................30
  20.             Excavation.....................................................................................31
  21.             Services and Equipment.........................................................................31
  22.             Escalation.....................................................................................33
  23.             Electricity Inclusion..........................................................................39
  24.             Broker.........................................................................................43
  25.             Subordination and Ground Lease.................................................................43
  26.             Estoppel Certificate...........................................................................46
  27.             Waiver of Jury Trial...........................................................................46
  28.             Surrender of Premises..........................................................................46
  29.             Rules and Regulations..........................................................................47
  30.             Successors and Assigns and Definitions.........................................................47
  31.             Notices........................................................................................49
  32.             No Waiver; Entire Agreement....................................................................49
  33.             Captions.......................................................................................51
  34.             Inability to Perform...........................................................................51
  35.             No Representations by Landlord.................................................................52
  36.             Security Deposit...............................................................................52
</TABLE>




                                        i
<PAGE>

                          TABLE OF CONTENTS (continued)
                          -----------------------------

<TABLE>
<CAPTION>
Article                                                                                                        Page
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<S>                                                                                                             <C>
  37.             Rent Control...................................................................................55
  38.             Late Payment Charges...........................................................................55
                  Testimonium and Signatures.....................................................................56
                  Acknowledgments................................................................................57
                  Schedule A                Floor Plan...........................................................58
                  Schedule B                Description of Land..................................................59
                  Schedule C                Rules and Regulations................................................61
                  Schedule D                Cleaning Specifications..............................................67
                  Schedule E                Definitions..........................................................69
</TABLE>









                                       ii
<PAGE>

                  INDENTURE OF LEASE made this ____ day of March, 2001, between
MADISON THIRD BUILDING COMPANIES LLC, a New York limited liability company,
having an office at 750 Lexington Avenue, New York, New York 10022 ("Landlord")
and CONSTELLATION 3D, INC., a ____________ corporation having an office at
___________________________ ("Tenant").


                              W I T N E S S E T H :

                                    ARTICLE 1

                                 Premises; Term

                  Landlord hereby leases to Tenant and Tenant hereby hires from
Landlord the following space ("Demised Premises"): part of the 14th floor as
shown crosshatched on the floor plan (Schedule A) attached hereto, in the office
building known as and by the street number 805 Third Avenue, in the Borough of
Manhattan, City and State of New York ("Building"), together with the
non-exclusive right to use the common areas of the Building together with the
other tenants therein, upon and subject to the terms, covenants and conditions
hereafter set forth.

                  TO HAVE AND TO HOLD the Demised Premises unto Tenant for a
term commencing on April 1, 2001 (the "Commencement Date"), and ending on April
30, 2006 (the "Expiration Date"), or on such earlier date upon which said term
may expire or terminate pursuant to the conditions of this Lease or pursuant to
law.

                  IT IS MUTUALLY COVENANTED AND AGREED between Landlord and
Tenant as follows:


                                    ARTICLE 2

                              Commencement of Term





                  Section 2.01. The term of this Lease and the payment of
minimum rent hereunder shall commence on the Commencement Date, and Landlord
shall deliver possession of the Demised Premises on the Commencement Date,
vacant in broom clean condition. Landlord shall have no obligation to perform
any work in connection with preparing the Demised Premises for Tenant's
occupancy. Notwithstanding the foregoing,

                                       1
<PAGE>

If Landlord cannot deliver possession of the Demised Premises to Tenant on the
Commencement Date because of the holding over of any tenant or occupant of the
Demised Premises, this Lease shall not be void or voidable, nor shall Landlord
be liable to Tenant for any loss or damage resulting therefrom. In that event,
however, the Commencement Date shall be the date when Landlord delivers
possession of the Demised Premises to Tenant and the Expiration Date shall be
five (5) years and one (1) month after the Commencement Date, plus the number of
days required, if any, to have such term expire on the last day of the calendar
month in which such date occurs. Notwithstanding the foregoing, if Landlord
fails to deliver the Demised Premises to Tenant in the condition required in
this Section 2.01 by May 31, 2001, then Tenant shall be entitled to an
additional abatement of the minimum rent in the amount of $456.39 for each one
(1) business day thereafter until the Demised Premises have been delivered to
Tenant.

                  Section 2.02. If, prior to the Commencement Date, Tenant,
subject to Landlord's consent, shall enter the Demised Premises to make any
installations, Landlord shall have no liability or obligation for the care or
preservation of tenant's property.

                  Section 2.03. Tenant has fully inspected the Demised Premises,
is familiar with the condition thereof and agrees to accept possession of the
same on the Commencement Date in their then "As Is" condition, except as
otherwise provided herein.


                                    ARTICLE 3

                                      Rent

                  Section 3.01. Tenant shall pay as rent for the Demised
Premises, the following:

                           (a) a fixed minimum rent (the "minimum rent") at the
                  annual rate of $182,900 per annum (or $15,241.67 per month);
                  and

                           (b) all other sums and charges required to be paid by
                  Tenant under the terms of this Lease (including without
                  limitation, the payments required to be made under Article
                  22), which shall be deemed to be and are sometimes referred to
                  hereafter as additional rent.

                  Section 3.02. Notwithstanding the provisions of Section 3.01
hereof and provided Tenant is not then in default under any of the provisions of
this Lease on its part to be performed, Tenant shall be entitled to an abatement
of part of the minimum rent only in the amount of $14,466.67 for the 1st month
of the term succeeding the Commencement Date, provided that the balance of the
minimum rent for such month of $775.00 shall be payable by Tenant. Tenant shall
be required to pay additional rent and all other sums from

                                       2
<PAGE>

and after the Commencement Date.

                  Section 3.03. The minimum rent shall be payable in equal
monthly installments in advance on the first day of each and every month during
the term of this Lease, except that the amount of $15,241.67 shall be paid upon
the execution of this Lease and shall be applied to payment of the minimum rent
for the second (2nd) month of the term succeeding the Commencement Date.

                  Section 3.04. Tenant shall pay the minimum rent and additional
rent in lawful money of the United States which shall be legal tender for the
payment of all debts, public and private, at the time of payment.

                  Landlord and Tenant agree that, from this day forward, Tenant
shall pay all rent, additional rent and other amounts now due or hereafter to
become due to the Landlord or its agents under or in connection with this Lease,
any tenant improvement or other similar agreement(s) and/or any other agreement
executed or delivered in connection therewith (or the Demised Premises
thereunder), including, without limitation, minimum rent, additional rent,
"escalations", "pass-throughs", contributions or reimbursement on account of
Tenant or other work, and all other items of rent and additional rent
(collectively, the "Rents") (as and when due) directly to the following lock-box
account:

                             Madison Third Building Companies LLC
                             P.O. Box 40143
                             Newark, New Jersey 07101-8007

All Rent checks shall be made payable to Madison Third Building Companies LLC.
It is agreed that Tenant shall be fully discharged from any Rent or other
obligation under this Lease which would otherwise have been relieved by the
actual payment made into the lock-box account if Tenant had made such payment
directly to Landlord.

                  Section 3.05. The minimum rent and additional rent shall be
payable by Tenant without any set-off, abatement or deduction whatsoever and
without notice or demand, except as otherwise expressly provided herein.


                                    ARTICLE 4

                                       Use

                  Section 4.01. Tenant shall use and occupy the Demised Premises
for administrative, executive and general office purposes only.

                                       3
<PAGE>

                  Section 4.02. Notwithstanding the provisions of Section 4.01,
Tenant shall not use or allow the use of the Demised Premises or any part
thereof (1) for the cooking and/or sale of food, except that Tenant may warm
foods; (2) for storage for sale of any alcoholic beverage in the Demised
Premises; (3) for storage for and/or sale of any product or material from the
Demised Premises, subject to (1) above; (4) for manufacturing or commercial
printing purposes; (5) for the conduct of a school or training facility (other
than with respect to the training of Tenant's employees') or conduct of any
business which results in the presence of the general public in the Demised
Premises; (6) for the conduct of the business of an employment agency or
personnel agency; (7) for the conduct of any public auction, gathering, meeting
or exhibition; (8) for occupancy by a foreign, United States, state, municipal
or other governmental or quasi-governmental body, agency or department or any
authority or other entity which is affiliated therewith or controlled thereby
and which has diplomatic or sovereign immunity or the like with respect to a
commercial lease; (9) for messenger or delivery service (excluding Tenant's or
any subtenant's own employees); (10) as a public stenographer or typist; (11) as
a telephone or telegraph agency; (12) as medical offices; (13) as a travel
agency; (14) as a dating service; (15) as a restaurant; (16) as a company
engaged in the business of renting office(s) or desk space in the Demised
Premises; (17) as a night club, discotheque, arcade or like kind establishments;
(18) as a public or quasi-public health facility, radiation treatment facility,
methadone clinic or other drug related clinic, abortion clinic, or for any
practice conducted in or through the format of a clinic; (19) as a pawn shop;
(20) as an off-track betting parlor; (21) as a homeless shelter, soup kitchen or
similar use; (22) for the sale or display or pornographic products or services;
(23) for the use or storage of flammable liquids or chemicals (unless incidental
to a permitted use); (24) as a funeral parlor; (25) for the sale or grooming of
pets; or (26) for any form of spiritualist services, such as fortune telling or
reading.

                  Section 4.03. If any governmental license or permit, other
than a Certificate of Occupancy or other than for the general use and occupation
of the Building, shall be required for the proper and lawful conduct of Tenant's
business in the Demised Premises, or any part thereof, and if failure to secure
such license or permit would in any way affect Landlord, Tenant, at its expense,
shall duly procure and thereafter maintain such license or permit and submit the
same for inspection by Landlord. Tenant shall at all times comply with the terms
and conditions of each such license or permit.

                  Section 4.04. Tenant shall not at any time use or occupy, or
permit anyone to use or occupy, the Demised Premises, or do or permit anything
to be done in the Demised Premises, in violation of the Certificate of
Occupancy, for the Demised Premises or for the Building, and will not permit or
cause any act to be done by itself or its agents or contractors or any condition
to exist (other than conditions existing on the date hereof) on the Demised
Premises which may be dangerous unless safeguarded as required by law, or which
in law constitutes a nuisance, public or private, or which may make void or
voidable any insurance then in force covering the Building and building
equipment.

                                       4
<PAGE>

Landlord represents that the Certificate of Occupancy in effect for the Building
permits Tenant's use of the Demised Premises for the purposes set forth in
Section 4.01.

                                    ARTICLE 5

                              Alterations, Fixtures

                                       5
<PAGE>

                  Section 5.01. Tenant, without Landlord's prior consent, shall
make no decorations, alterations, installations, additions, or improvements of a
structural nature ("work") in or to the Demised Premises, including, but not
limited to, an air-conditioning or cooling system, mezzanine floors, galleries
and the like. If any contractor, other than Landlord, shall perform work, such
contractor shall first be approved by Landlord, and as a condition of such
approval, Tenant shall pay to Landlord five (5%) percent of the cost of such
work for supervision, coordination and other expenses incurred by Landlord in
connection therewith. However, such five (5%) percent charge shall not apply to
painting, carpeting, wall covering and furnishings. Workers' compensation and
public liability insurance and property damage insurance, all in amounts and
with companies and/or forms reasonably satisfactory to Landlord, shall be
provided and at all times maintained by Tenant's contractors engaged in the
performance of the work, and before proceeding with the work, certificates of
such insurance shall be furnished to Landlord. If consented to by Landlord, all
such work shall be done at Tenant's sole expense and in full compliance with all
governmental authorities having jurisdiction thereover. Upon completion of such
work, Tenant shall deliver to Landlord full scale "as built" plans for the same,
where plans are necessary. Tenant acknowledges that an ICIP Program (as
hereinafter defined) may impose requirements with respect to the hiring and
training practices, among other matters, of contractors and subcontractors
engaged to perform certain work in the Building for Tenant (collectively, herein
called "Tenant's Contractors"). Tenant shall use Tenant's Contractors (subject
to Landlord's approval) that qualify under the applicable requirements of the
ICIP Program for the performance of Tenant's initial work and any subsequent
alterations to the Demised Premises and Tenant will require Tenant's Contractors
to comply with the provisions of the ICIP Program. If Landlord is notified of
any violation of the ICIP Program by Tenant's Contractors, Landlord shall
promptly advise Tenant, and Tenant shall take all necessary actions to cure such
violations. All work affixed to the realty or if not so affixed but for which
Tenant shall have received a credit, shall become the property of Landlord,
subject to Tenant's right to replace same during the term hereof with items of
equal quality class and value, and shall remain upon, and be surrendered with,
the Demised Premises as a part thereof at the end of the term or any renewal or
extension term, as the case may be, without allowance to Tenant or charge to
Landlord, unless Landlord elects otherwise on notice to Tenant given at the time
Landlord grants its approval for such work. However, if Landlord shall elect,
otherwise, Tenant at Tenant's expense, at or prior to any termination of this
Lease, provided Landlord specifies that such work must be removed at the time
approval therefor is granted, shall remove all such work or such portion thereof
as Landlord shall elect and Tenant shall restore the Demised Premises to its
original condition, reasonable wear and tear excepted, at Tenant's expense. If
any Building facilities or services, including but not limited to
air-conditioning and ventilating equipment installed by Landlord, are adversely
affected or damaged by reason of the work by Tenant, Tenant, at its expense,
shall repair such damage to the extent such damage has been caused by Tenant's
work and shall correct the work so as to prevent any further damage or adverse
effect on such facilities or services.

                                       6
<PAGE>

                  Section 5.02. Prior to commencing any work pursuant to the
provisions of Section 5.01, Tenant shall furnish to Landlord:

                           (a) Plans and specifications for the work to be done.

                           (b) Copies of all governmental permits and
         authorizations which may be required in connection with such work.
         Landlord, without cost, shall, if required, cooperate with Tenant in
         obtaining the same.

                           (c) A certificate evidencing that Tenant (or Tenant's
         contractor) has procured workmen's compensation insurance covering all
         persons employed in connection with the work who might assert claims
         for death or bodily injury against Landlord, Tenant or the Building.

                           (d) Such additional personal injury and property
         damage insurance (over and above the insurance required to be carried
         by Tenant pursuant to the provisions of Section 9.03) as Landlord may
         reasonably require because of the nature of the work to be done by
         Tenant.

                           (e) A bond or other security satisfactory to
         Landlord, in the amount of one hundred five (105%) percent of the cost
         of the work, to insure completion of such work.

                  Section 5.03. Where furnished by or at the expense of Tenant
(except the replacement of an item theretofore furnished and paid for by
Landlord or for which Tenant has received a credit), all movable property,
furniture, furnishings, roller files, equipment and trade fixtures
("personalty") other than those affixed to the realty shall remain the property
of and shall be removed by Tenant on or prior to any termination or expiration
of this Lease, and, in the case of damage by reason of such removal, Tenant, at
Tenant's expense, promptly shall repair the damage. If Tenant does not remove
any such personalty, Landlord, at its election, (a) may cause the personalty to
be removed and placed in storage at Tenant's expense or (b) may treat the
personalty as abandoned and may dispose of the personalty as it sees fit without
accounting to Tenant for any proceeds realized upon such disposal.

                  Section 5.04. Tenant agrees that the exercise of its rights
pursuant to the provisions of this Article 5 shall not be done in a manner which
would create any work stoppage, picketing, labor disruption or dispute or
violate Landlord's union contracts affecting the Building or interfere with the
business of Landlord or any Tenant or occupant of the Building. In the event of
the occurrence of any condition described above arising from the exercise by
Tenant of its right pursuant to the provisions of this Article 5, Tenant shall,
immediately upon notice from Landlord, cease the manner of exercise of such
right giving rise to such condition. In the event Tenant fails to cease such
manner of exercise of its rights as aforesaid, Landlord, in addition to any
rights available to it under this Lease

                                       7
<PAGE>

and pursuant to law, shall have the right to injunction without notice. With
respect to Tenant's work, except for work done prior to the Commencement Date,
Tenant shall make all arrangements for, and pay all expenses incurred in
connection with, use of the freight elevators servicing the Demised Premises
during those hours other than as provided in Section 21.01(a) in accordance with
Landlord's customary charges therefor.


                                    ARTICLE 6

                                     Repairs

                  Section 6.01. Tenant shall take good care of the Demised
Premises and the fixtures therein and at its sole cost and expense make all
repairs thereto as and when needed to preserve them in good working order and
condition. Tenant shall make any repairs to the HVAC, mechanical, plumbing and
electrical systems within the Demised Premises necessitated by damage caused as
a result of the negligence or willful misconduct of Tenant, its agents,
contractors or employees. Landlord represents that on the Commencement Date the
HVAC, mechanical, plumbing and electrical systems within the Demised Premises
will be in good working order and condition. All damage or injury to the Demised
Premises or the Building or to any building equipment caused by Tenant moving
property in or out of the Building or by installation or removal of personalty
or resulting from negligence or conduct of Tenant, its employees, agents,
contractors, customers, invitees and visitors, shall be repaired, promptly by
Tenant at Tenant's expense, and whether or not involving structural changes or
alterations, to the satisfaction of Landlord. All repairs shall include
replacements or substitutions where necessary and shall be at least equal to the
quality, class and value of the property repaired, replaced or substituted and
shall be done in a good and workmanlike manner.

                  Section 6.02. Landlord, at its expense, shall maintain and
make all repairs and replacements, structural and otherwise, to the exterior and
public portions of the Building and to the Demised Premises, including, without
limitation, all Building systems, unless Tenant is required to make them under
the provisions of Section 6.01 or unless necessitated by damage caused as a
result of the performance or existence of alterations performed by Tenant or on
Tenant's behalf, in which event Tenant, at its expense, shall perform such
maintenance, repairs or replacements. Tenant shall notify Landlord of the
necessity for any repairs for which Landlord may be responsible in the Demised
Premises under the provisions of this Section. Landlord shall have no liability
to Tenant by reason of any inconvenience, annoyance, interruption or injury to
business arising from Landlord's making any repairs or changes which Landlord is
required or permitted by this Lease, or required by law, to make in or to any
portion of the Building or the Demised Premises, or in or to the fixtures,
equipment or appurtenances of the Building or the Demised Premises. Landlord
shall use reasonable efforts to make such repairs or changes in a manner which
shall minimize interference with the normal conduct of Tenant's business and
which shall

                                       8
<PAGE>

not affect the square footage or dimensions of the Demised Premises, provided
Landlord shall not be required to employ overtime or premium labor.

                  Section 6.03. Tenant shall not store or place any materials or
other obstructions in the lobby or other public portions of the Building, or on
the sidewalk abutting the Building.


                                    ARTICLE 7

                                Floor Load; Noise

                  Section 7.01. Tenant shall not place a load upon any floor of
the Demised Premises which exceeds the load per square foot which such floor was
designed to carry (50 lbs. live per square foot).

                  Section 7.02. Business machines and mechanical equipment
belonging to Tenant which cause noise, vibration or any other nuisance that may
be transmitted to the structure or other portions of the Building or to the
Demised Premises, to such a degree as to be reasonably objectionable to Landlord
or which unreasonably interfere with the use or enjoyment by other tenants of
their premises or the public portions of the Building, shall be placed and
maintained by Tenant, at Tenant's expense, in settings of cork, rubber or spring
type vibration eliminators sufficient to adequately reduce or eliminate such
objectionable or interfering noise or vibration.


                                    ARTICLE 8

             Laws, Ordinances, Requirements of Public Authorities

                  Section 8.01. (a) Tenant, at its expense, shall comply with
         all laws, orders, ordinances, rules and regulations and directions of
         Federal, State, County and Municipal authorities and departments
         thereof having jurisdiction over the Demised Premises and the Building
         ("Governmental Requirements") arising by reason of Tenant's particular
         manner of use of the Demised Premises which is distinct from the manner
         of use typically observed in general and executive office space, or any
         installations made therein by or at Tenant's request, or any default by
         Tenant under this Lease.

                           (b) Landlord, at its expense, shall comply with and
         cure Governmental Requirements relating to the public portions of the
         Building and to the Demised Premises, provided non-compliance will
         curtail Tenant's use of or access to the Demised Premises and provided
         that Tenant is not

                                       9
<PAGE>

         obligated to comply with them under the provisions of subdivision (a)
         of this Section. Landlord, at its expense, may contest the validity of
         any Governmental Requirements and postpone compliance therewith pending
         such contest.

                  Section 8.02. Landlord represents that on the Commencement
Date the Demised Premises will be in compliance with Governmental Requirements
and will not contain asbestos.

                  Section 8.03. If Tenant receives written notice of any
violation of any Governmental Requirements applicable to the Demised Premises,
it shall give prompt notice thereof to Landlord.

                  Section 8.04. Tenant will not clean, nor allow any window in
the Demised Premises to be cleaned, from the outside in violation of Section 202
of the Labor Law or the rules of the Board of Standards and Appeals or of any
other board or body having or asserting jurisdiction.


                                    ARTICLE 9

                                    Insurance

                  Section 9.01. Tenant shall not do or permit to be done any act
or thing in or upon the Demised Premises which will invalidate or be in conflict
with the Certificate of Occupancy for the Building or the terms of the insurance
policies covering the Building and the property and equipment therein; and
Tenant, at its expense, shall comply with all rules, orders, regulations and
requirements of the New York Board of Fire Underwriters or any other similar
body having jurisdiction, and of the insurance carriers, and shall not knowingly
do or permit anything to be done in or upon the Demised Premises in a manner
which increases the rate of insurance for the Building or any property or
equipment therein over the rate in effect on the Commencement Date, provided
that Tenant shall only have such compliance obligations if its particular manner
of use cause the non-complying condition.

                  Section 9.02. If, by reason of Tenant's failure to comply with
the provisions of Section 9.01 or any of the other provisions of this Lease, the
rate of insurance for the Building or the property and equipment of Landlord
shall be higher than on the Commencement Date, Tenant shall pay to Landlord any
additional or increased insurance premiums to the extent resulting therefrom
thereafter paid by Landlord, and Tenant shall make such payment forthwith on
demand of Landlord, provided if such increase is also due to the acts of other
tenants, Landlord shall equitably apportion the liability therefor based upon
the relative size of the Demised Premises and such tenants. In any action or

                                       10
<PAGE>

proceeding wherein Landlord and Tenant are parties, a schedule or "make up" of
any insurance rate for the Building or Demised Premises issued by the New York
Fire Insurance Exchange, or other body establishing fire insurance rates for the
Building, shall be conclusive evidence of the facts therein stated and of the
several items and charges in the insurance rates then applicable to the Building
or Demised Premises.

                  Section 9.03. (a) Tenant covenants to provide on or before the
         Commencement Date and to keep in force during the term hereof, the
         following insurance coverage:

                                    (i) (i) For the benefit of Landlord and
                  Tenant, a commercial policy of liability insurance protecting
                  and indemnifying Landlord and Tenant against any and all
                  claims for personal injury, death or property damage occurring
                  upon, in or about the Demised Premises, and the public
                  portions of the Building in connection with any act of Tenant,
                  its employees, agents, contractors, customers, invitees and
                  visitors including, without limitation, personal injury, death
                  or property damage resulting from any work performed by or on
                  behalf of Tenant, with coverage of not less than $2,000,000
                  combined single limit for personal injury, death and property
                  damage arising out of one occurrence or accident.

                                    (ii) Fire and extended coverage in an amount
                  adequate to cover the cost of replacement of all personal
                  property, fixtures, furnishings and equipment, including
                  Tenant's work (as referred to in Section 5.01), located in the
                  Demised Premises.

                           (b) All such insurance shall (i) be effected under
         valid and enforceable policies, (ii) be issued by insurers of
         recognized responsibility authorized to do business in the State of New
         York, (iii) contain a provision whereby the insurer agrees not to
         cancel the insurance without ten (10) days' prior written notice to
         Landlord, and (iv) contain a provision that no act or omission of
         Tenant shall result in forfeiture of the insurance as against Landlord.

                  On or before the Commencement Date, Tenant shall deliver to
Landlord duplicate originals of the aforesaid policies or certificates
evidencing the aforesaid insurance coverage, and renewal policies or
certificates shall be delivered to Landlord at least thirty (30) days prior to
the expiration date of each policy with proof of payment of the premiums
thereof.

                                       11
<PAGE>

                  Section 9.04. Landlord shall maintain fire and extended
coverage insurance covering the Building and shall also maintain liability
insurance, in each case in such amounts, from such insurers, and otherwise, as
an institutional mortgagee would require for the Building.

                  Section 9.05. Landlord and Tenant shall each secure an
appropriate clause in, or an endorsement upon, each fire or extended coverage
policy obtained by it and covering the Building, the Demised Premises or the
personal property, fixtures and equipment located therein or thereon, pursuant
to which the respective insurance companies waive subrogation or permit the
insured, prior to any loss, to agree with a third party to waive any claim it
might have against said third party. The waiver of subrogation or permission for
waiver of any claim herein before referred to shall extend to the agents of each
party and its employees and, in the case of Tenant, shall also extend to all
other persons and entities occupying or using the Demised Premises in accordance
with the terms of this lease. If and to the extent that such waiver or
permission can be obtained only upon payment of an additional charge, then, the
party benefitting from the waiver or permission shall pay such charge upon
demand, or shall be deemed to have agreed that the party obtaining the insurance
coverage in question shall be free of any further obligations under the
provisions hereof relating to such waiver or permission.

                  Subject to the foregoing provisions of this Section 9.04, and
insofar as may be permitted by the terms of the insurance policies carried by
it, (i) each party hereby releases the other with respect to any claim
(including a claim for negligence) which it might otherwise have against the
other party for loss, damages or destruction with respect to its property by
fire or other casualty (including rental value or business interruption, as the
case may be) occurring during the term of this Lease and (ii) Tenant releases
other tenants but only to the extent that the policies of such other tenants
permit a similar waiver for the benefit of Tenant and such other tenant gives
such a waiver.

                                       12
<PAGE>

                                   ARTICLE 10

                          Damage by Fire or Other Cause

                  Section 10.01. If the Demised Premises shall be damaged by
fire or other casualty, the damage shall be repaired by and at the expense of
Landlord and the minimum rent until such repairs shall be made, shall be
apportioned according to the part of the Demised Premises which is usable or
accessible by Tenant. Landlord shall have no responsibility to repair any damage
to Tenant's work (as referred to in Section 5.01), the same being the
responsibility of Tenant. No penalty shall accrue for delays which may arise by
reason of adjustment of insurance by Landlord, unavoidable delays (as
hereinafter defined), or any other cause beyond Landlord's reasonable control.
Tenant shall give notice to Landlord promptly upon learning thereof in case of
fire or other damage to the Demised Premises. If the Demised Premises and at
least 50% of the other rentable space in the Building are totally or
substantially damaged or are rendered wholly or substantially unusable by fire
or any such other casualty, or if the Building shall be so damaged that Landlord
shall decide to demolish it or to rebuild it (whether or not the Demised
Premises shall have been damaged), Landlord at its election may terminate this
Lease by written notice to Tenant, within ninety (90) days after such fire or
other casualty, and thereupon the term of this Lease shall expire by lapse of
time upon the third (3rd) day after such notice is given, and Tenant shall
vacate and surrender the Demised Premises to Landlord. Tenant shall not be
liable under this Lease for anything accruing after the date of such expiration.
Tenant hereby waives the provisions of Section 227 of the Real Property Law, and
the provisions of this Article shall govern and control in lieu thereof. If the
damage is due to the fault or neglect of Tenant, the debris shall be removed by,
and at the expense of, Tenant.

                  Notwithstanding the foregoing provisions of this Section
10.01, within sixty (60) days after such casualty, Landlord shall provide Tenant
with an estimate as to the time reasonable required to repair such damage. If
such period exceeds six (6) months from the date of such casualty, Tenant may
elect to terminate this Lease by notice to Landlord not later than ten (10) days
following Tenant's receipt of such estimate, and thereupon the term of this
Lease shall expire on the thirtieth (30th) day after Tenant's notice is given,
and Tenant shall vacate and surrender the Demised Premises to Landlord. If the
time period set forth in said estimate exceeds six (6) months and Tenant has not
terminated this Lease and if Landlord does not substantially complete such
repairs within the time period set forth in such estimate, then Tenant may elect
to terminate this Lease by notice to Landlord within ten (10) days following the
expiration of such time period, and thereupon the term of this Lease shall
expire on the thirtieth (30th) day after such notice is given, and Tenant shall
vacate and surrender the Demised Premises to Landlord, unless within such thirty
(30) day period, Landlord substantially completes such restoration or rebuilding
in which event this Lease shall remain in full force and effect.

                                       13
<PAGE>

                  Section 10.02. No damages of compensation shall be payable by
Landlord nor shall Tenant make any claim for inconvenience, loss of business or
annoyance arising from any repair or restoration of any portion of the Demised
Premises or of the Building. Landlord shall use reasonable efforts to commence
and effect such repairs promptly and in such manner as to minimize interference
with Tenant's use and occupancy of the Demised Premises and any access thereto,
provided Landlord shall not be obligated to employ overtime or premium labor.


                                   ARTICLE 11

                       Assignment, Subletting, Mortgaging

                  Section 11.01. Tenant will not, by operation of law or
otherwise, assign, mortgage or encumber this Lease, or sublet or permit the
Demised Premises or any part thereof to be used by others, without Landlord's
prior written consent in each instance. If this Lease be assigned, or if the
Demised Premises or any part thereof be underlet or occupied by anybody other
than Tenant, Landlord, may, after default by Tenant, collect rent from the
assignee, undertenant or occupant, and apply the net amount collected to the
rent herein reserved, but no assignment, underletting, occupancy or collection
shall be deemed a waiver of the provisions hereof, the acceptance of the
assignee, undertenant or occupant as tenant, or a release of Tenant from the
further performance by Tenant of covenants on the part of Tenant herein
contained. The consent by Landlord to any assignment, subletting, mortgage or
encumbrance shall not in any manner be construed to relieve Tenant from
obtaining Landlord's express consent to any other or further assignment,
subletting, mortgage or encumbrance. In no event shall any permitted sublessee
assign or encumber its sublease or further sublet all or any portion of its
sublet space, or otherwise suffer or permit the sublet space or any part thereof
to be used or occupied by others, without Landlord's prior written consent in
each instance.

                  Section 11.02. If Tenant shall at any time or times during the
term of this Lease desire to assign this Lease or sublet all or part of the
Demised Premises, Tenant shall give notice thereof to Landlord, which notice
shall be accompanied by (a) a conformed or photostatic copy of the proposed
assignment or sublease, the effective or commencement date of which shall be not
less than thirty (30) nor more than 180 days after the giving of such notice,
(b) a statement setting forth in reasonable detail the identity of the proposed
assignee or subtenant, the nature of its business and its proposed use of the
Demised Premises, and (c) current financial information with respect to the
proposed assignee or subtenant, including, without limitation, its most recent
financial report. Such notice shall be deemed an offer from Tenant to Landlord
whereby Landlord (or Landlord's designee) may, at its option, (i) terminate this
Lease if the proposed transaction is an assignment or a sublease (whether by one
sublease or a series of related or unrelated subleases) of all of substantially
all of the Demised Premises for the balance of the term, or (ii) terminate this
Lease with respect to the space being sublet (if the proposed

                                       14
<PAGE>

transaction is a sublease of part of the Demised Premises for the balance of the
term). Said options may be exercised by Landlord by notice to Tenant at any time
within thirty (30) days after such notice has been given by Tenant to Landlord;
and during such thirty (30) day period Tenant shall not assign this Lease nor
sublet such space to any person.

                  Section 11.03. If Landlord exercises its option to terminate
this Lease in the case where Tenant desires either to assign this Lease or
sublet (whether by one sublease or a series of related or unrelated subleases)
all or substantially all of the Demised Premises for the balance of the term,
then, this Lease shall end and expire on the date that such assignment or sublet
was to be effective or commence, as the case may be, and the minimum rent and
additional rent shall be paid and apportioned to such date.

                  Section 11.04. If Landlord exercises its option to terminate
this Lease in part in any case where Tenant desires to sublet part of the
Demised Premises for the balance of the term, then, (a) this Lease shall end and
expire with respect to such part of the Demised Premises on the date that the
proposed sublease was to commence; and (b) from and after such date the minimum
rent and additional rent shall be adjusted, based upon the proportion that the
rentable area of the Demised Premises remaining bears to the total rentable area
of the Demised Premises; and (c) Tenant shall pay to Landlord, upon demand, the
costs incurred by Landlord in physically separating such part of the Demised
Premises from the balance of the Demised Premises and in complying with any laws
and requirements of any public authorities relating to such separation.

                  Section 11.05. In the event Landlord does not exercise an
option provided to it pursuant to Section 11.02 and provided that Tenant is not
in default in any of Tenant's obligations under this Lease, Landlord's consent
(which must be in writing and in form reasonably satisfactory to Landlord) to
the proposed assignment or sublease shall not be unreasonably withheld or
delayed, provided and upon condition that:

                  (a) Tenant shall have complied with the provisions of Section
         11.02 and Landlord shall not have exercised its option under said
         Section 11.02 within the time permitted therefor;

                  (b) The proposed assignee or subtenant is engaged in a
         business and the Demised Premises, or the relevant part thereof, will
         be used in a manner which is limited to the use expressly permitted
         under Sections 4.01 and 4.02 of this Lease;

                  (c) The proposed assignee or subtenant is a reputable person
         of good character and with sufficient financial worth considering the
         responsibility involved, and Landlord has been furnished with
         reasonable proof thereof;

                                       15
<PAGE>

                  (d) Neither (i) the proposed assignee or sublessee nor (ii)
         any person which, directly or indirectly, controls, is controlled by or
         is under common control with, the proposed assignee or sublessee, is
         then an occupant of any part of the Building, provided there is
         comparable space in the Building available for leasing by Landlord;

                  (e) The proposed assignee or sublessee is not a person with
         whom Landlord is currently negotiating to lease space in the Building,
         provided there is comparable space in the Building available for
         leasing by Landlord;

                  (f) The proposed sublease shall be in form reasonably
         satisfactory to Landlord and shall comply with the provisions of this
         Article;

                  (g) At any one time there shall not be more than two (2)
         subtenants in the Demised Premises;

                  (h) Tenant shall reimburse Landlord on demand for any
         reasonable costs that may be incurred by Landlord in connection with
         said assignment or sublease, including, without limitation, the
         reasonable costs incurred in making investigations as to the
         acceptability of the proposed assignee or subtenant, and reasonable
         legal costs incurred in connection with the granting of any requested
         consent, which costs shall not exceed $3,000 with respect to any one
         transaction;

                  (i) Tenant shall not have (i) advertised in any way the
         availability of the Demised Premises without prior notice to Landlord
         or (ii) listed the same at a rental rate less than the minimum rent or
         additional rent at which Landlord is then offering to lease other
         comparable space in the Building; and

                  (j) The proposed subtenant or assignee shall not be entitled,
         directly or indirectly, to diplomatic or sovereign immunity and shall
         be subject to, or shall submit itself to, the service of process in and
         the jurisdiction of the courts of New York State.

                  Each subletting pursuant to this Article shall be subject to
all of the covenants, agreements, terms, provisions and conditions contained in
this Lease. Notwithstanding any such subletting to any other subtenant and/or
acceptance of rent or additional rent by Landlord from any subtenant, Tenant
shall and will remain fully liable for the payment for the minimum rent and
additional rent due and to become due hereunder and for the performance of all
the covenants, agreements, terms, provisions and conditions contained in this
Lease on the part of Tenant to be performed and all acts and omissions

                                       16
<PAGE>

of any licensee or subtenant or anyone claiming under or through any subtenant
which shall be in violation of any of the obligations of this Lease, and any
such violation shall be deemed to be a violation by Tenant. Tenant further
agrees that notwithstanding any such subletting, no other and further subletting
of the Demised Premises by Tenant or any person claiming through or under Tenant
shall or will be made except upon compliance with and subject to the provisions
of this Article. If Landlord shall decline to give its consent to any proposed
assignment or sublease, or if Landlord shall exercise its option under Section
11.02, Tenant shall indemnify, defend and hold harmless Landlord against and
from any and all loss, liability, damages, costs and expenses (including
reasonable counsel fees) resulting from any claims that may be made against
Landlord by Tenant's proposed assignee or sublessee or by any brokers or other
persons claiming a commission or similar compensation in connection with the
proposed assignment or sublease. Notwithstanding the foregoing, provided Tenant
is not then in default in the performance of any of its obligations hereunder,
Tenant, without Landlord's consent, but subject to the provisions of this
paragraph and Section 11.07, may sublet all or any part of the Demised Premises
to a business entity which controls, is controlled by or is under common control
with Tenant, provided a duly executed counterpart of such sublease in form
satisfactory to Landlord, is delivered to Landlord at least ten (10) days prior
to its effective date. Tenant, without Landlord's consent, may also rent desk
space, from time to time, to business consultants, provided the same shall not
exceed, in the aggregate ten (10%) percent of the rentable area of the Demised
Premises, the same shall not create any privity between Landlord and such
occupant nor shall such occupant have any rights under this Lease.

                  Section 11.06. In the event that (a) Landlord fails to
exercise its options under Section 11.02 and consents to a proposed assignment
or sublease, and (b) Tenant fails to execute and deliver an assignment or
sublease to which Landlord consented within ninety (90) days after the giving of
such consent, then, Tenant shall again comply with all of the provisions and
conditions of Section 11.02 before assigning this Lease or subletting all or
part of the Demised Premises.

                  Section 11.07. With respect to each and every sublease or
subletting authorized by Landlord under the provisions of this Lease, it is
further agreed:

                           (a) No subletting shall be for a term ending later
         than one day prior to the expiration date of this Lease;

                           (b) No sublease shall be valid, and no subtenant
         shall take possession of the Premises or any part thereof, until an
         executed counterpart of such sublease has been delivered to Landlord;

                           (c) Each sublease shall provide that it is subject
         and subordinate to this Lease and to the matters to which this Lease is
         or shall

                                       17
<PAGE>

         be subordinate, and that in the event of termination, re-entry or
         dispossess by Landlord under this Lease Landlord may take over all of
         the right, title and interest of Tenant, as sublessor, under such
         sublease, and such subtenant shall attorn to Landlord pursuant to the
         then executory provisions of such sublease, except that Landlord shall
         not (i) be liable for any previous act or omission of Tenant under such
         sublease, (ii) be subject to any offset, not expressly provided in such
         sublease, which thereto accrued to such subtenant against Tenant, or
         (iii) be bound by any previous modification of such sublease or by any
         previous prepayment of more than one month's rent.

                  Section 11.08. If Landlord gives its consent to any assignment
of this Lease or to any sublease, Tenant shall, in consideration therefor, pay
to Landlord, as additional rent:

                           (a) in the case of an assignment of this Lease or an
         assignment of any sublease, an amount equal to 75% of all sums and
         other considerations paid to Tenant from the assignee for such
         assignment or paid to Tenant by any sublessee or other person claiming
         through or under Tenant for such assignment (including, but not limited
         to sums paid for the sale of Tenant's or sublessee's fixtures,
         leasehold improvements, less, in case of a sale thereof, the then net
         unamortized or undepreciated cost thereof determined on the basis of
         Tenant's or sublessee's federal income tax returns). The sums payable
         to Landlord under this Section 11.10(a) shall be paid to Landlord as
         and when paid by such assignee to Tenant; and

                           (b) in the case of a sublease, an amount equal to 75%
         of the rents and charges and other consideration payable under the
         sublease to Tenant by the subtenant or paid to Tenant by any such
         sublessee or other person claiming through or under Tenant in
         connection with such subletting which is in excess of the minimum rent
         and additional rent provided in Article 22 accruing during the term of
         the sublease in respect of the subleased space (at the rate per square
         foot payable by Tenant hereunder or such sublessee) pursuant to the
         terms of this Lease (including, but not limited to, sums paid for the
         sale or rental of Tenant's fixtures, leasehold improvements, less, in
         the case of the sale thereof, the then net unamortized or undepreciated
         cost thereof determined on the basis of Tenant's or sublessee's federal
         income tax returns). The sums payable to Landlord under this Section
         11.10(b) shall be paid to Landlord as and when paid by such subtenant
         to Tenant.

                           (c) For the purposes of computing the sums payable by
         Tenant to Landlord under subparagraphs (a) and (b) hereof, there shall
         be

                                       18
<PAGE>

         excluded from the consideration payable to Tenant by any assignee or
         sublessee any transfer taxes, rent concession, reasonable attorneys'
         fees, reasonable brokerage commissions, advertising costs and fix-up
         and build-out costs paid by Tenant with respect to such assignment or
         subletting, but only to the extent any such sums are allocable to the
         period of this Lease (in the case of any assignment), or the term of
         any sublease.

                  Section 11.09. If Tenant or any subtenant is a corporation,
partnership, limited liability company or other entity, the provisions of
Section 11.01 shall apply to a transfer (by one or more transfers) of a majority
of the stock, partnership, membership or other ownership interests of Tenant or
such subtenant, as the case may be, as if such transfer of a majority of the
stock, partnership, membership or other ownership interests of Tenant or such
subtenant were an assignment of this Lease; but said provisions and the
provisions of Sections 11.02, 11.05, 11.07 and 11.08 shall not apply to
transactions with a corporation, partnership, limited liability company or other
entity into or with which Tenant or such subtenant is merged or consolidated or
to which substantially all of Tenant's or such subtenant's assets are
transferred or to any corporation, partnership, limited liability company or
other entity which controls, is controlled by Tenant or is under common control
with Tenant or such subtenant, provided that in any of such events (i) the
successor to Tenant or such subtenant has a net worth computed in accordance
with generally accepted accounting principles at least equal to the net worth of
Tenant or such subtenant immediately prior to such merger, consolidation or
transfer, and (ii) proof satisfactory to Landlord of such net worth shall have
been delivered to Landlord at least ten (10) days prior to the effective date of
any such transaction. Notwithstanding the foregoing, provided Tenant is not then
in default in the performance of any of its obligations hereunder, Tenant,
without Landlord's consent, but subject to the provisions of Section 11.10, may
assign this Lease to a business entity which controls, is controlled by or is
under common control with Tenant, provided a duly executed counterpart of such
assignment together with an assumption of this Lease by the assignee, both in
form satisfactory to Landlord, is delivered to Landlord at least ten (10) days
prior to its effective date. In addition, the transfer without Landlord's
consent of any of the stock of Tenant to existing stockholders of Tenant, trusts
for the benefit of such stockholders and family members of such stockholders,
shall not be deemed a violation of the prohibition against the transfer of stock
provided in this Section 11.09. The provisions of Sections 11.02, 11.05, 11.07
and 11.08 shall not apply to the transactions set forth in the previous two
sentences.

                  Section 11.10. Any assignment or transfer, whether made with
Landlord's consent pursuant to Section 11.05 or without Landlord's consent
pursuant to Section 11.09, shall be made only if, and shall not be effective
until, the assignee shall execute, acknowledge and deliver to Landlord an
agreement in form and substance reasonably satisfactory to Landlord whereby the
assignee shall assume the obligations of this Lease on the part of Tenant to be
performed or observed and whereby the assignee

                                       19
<PAGE>

shall agree that the provisions in this Article 11 shall, notwithstanding such
assignment or transfer, continue to be binding upon it in respect of all future
assignments and transfers. The original named Tenant covenants that,
notwithstanding any assignment or transfer, whether or not in violation of the
provisions of this Lease, and notwithstanding the acceptance of minimum rent
and/or additional rent by Landlord from an assignee, transferee, or any other
party, the original named Tenant shall remain fully liable for the payment of
the minimum rent and additional rent and for the other obligations of this Lease
on the part of Tenant to be performed or observed.

                  Section 11.11. The joint and several liability of Tenant and
any immediate or remote successor in interest of Tenant and the due performance
of the obligations of this Lease on Tenant's part to be performed or observed
shall not be discharged, released or impaired in any respect by any agreement or
stipulation made by Landlord extending the time of, or modifying any of the
obligations of, this Lease, or by any waiver or failure of Landlord to enforce
any of the obligations of this Lease.

                  Section 11.12. The listing of any name other than that of
Tenant, whether on the doors of the Demised Premises, or the Building directory,
if any, or otherwise, shall not operate to vest any right or interest in this
Lease or in the Demised Premises, nor shall it be deemed to be the consent of
Landlord to any assignment or transfer of this Lease, to any sublease of the
Demised Premises, or to the use or occupancy thereof by others. Tenant shall be
entitled to five (5) listings on the Building directory.


                                   ARTICLE 12

                  Liability of Landlord and Indemnity by Tenant

                  Section 12.01. Tenant shall indemnify Landlord against and
save Landlord harmless from any liability to and claim by or on behalf of any
person, firm, governmental authority, corporation or entity for personal injury,
death or property damage, arising:

                           (a) from the use by Tenant of the Demised Premises,
         or from any work whatsoever done or required to be performed by Tenant
         hereunder and omitted to be done by Tenant, its employees, agents,
         contractors, customers, invitees or visitors, or from any accident
         thereat due to any of the foregoing parties; and

                           (b) from any breach or default by Tenant of and under
         any of the terms, covenants and conditions of this Lease on Tenant's
         part to be performed.

                                       20
<PAGE>

                  Tenant also shall indemnify Landlord against and save Landlord
harmless from all costs, reasonable counsel fees, expenses and penalties
incurred by Landlord in connection with any such liability or claim other than
such liability or claim incurred as a result of Landlord's negligence or willful
misconduct.

                  If any action or proceeding shall be brought against Landlord
in connection with any such liability or claim, Tenant, on notice from Landlord,
shall defend such action or proceeding, at Tenant's expense, by counsel
reasonably satisfactory to Landlord, or by the attorney for Tenant's insurance
carrier whose insurance policy covers the liability or claim.

                  Section 12.02. Landlord shall not be liable for any damage to
property of Tenant or of others entrusted to employees of the Building, nor for
the loss of or damage to any property of Tenant by theft or otherwise. Landlord
and its agents shall not be liable for any injury or damage to persons or
property resulting from fire, explosion, falling plaster, steam, gas,
electricity, water, rain or snow or leaks from any part of the Building or from
the pipes, appliances or plumbing works or from the roof, street or sub-surface
or from any other place or by dampness or by any other cause of whatsoever
nature, except if any of the foregoing result from Landlord's failure to perform
its obligations hereunder; nor shall Landlord be liable for any such damage
caused by other tenants or persons in the Building or caused by operations in
construction of any public or quasi-public work; nor shall Landlord be liable
for any latent defect in the Demised Premises or in the Building. If, at any
time any windows of the Demised Premises are permanently closed, darkened or
bricked up by reason of the requirements of law or temporarily closed or
darkened by reason of repairs, alterations or maintenance by Landlord, Landlord
shall not be liable for any damage Tenant may sustain thereby and Tenant shall
not be entitled to any compensation therefor nor abatement of rent nor shall the
same release Tenant from its obligations hereunder.

                  Tenant shall reimburse and compensate Landlord, as additional
rent, within ten (10) days after rendition of a statement for all expenditures
made and for all losses, liabilities, claims, damages, fines, penalties and
expenses incurred by Landlord arising from any default by Tenant under this
Lease.

                  Tenant shall give immediate notice to Landlord upon its
discovery of accidents in the Demised Premises.

                                       21
<PAGE>

                  Section 12.03. If in this Lease it is provided that Landlord's
consent or approval as to any matter will not be unreasonably withheld, and it
is established by a court or body having final jurisdiction thereover that
Landlord has been unreasonable, the only effect of such finding shall be that
Landlord shall be deemed to have given its consent or approval; but Landlord
shall not be liable to Tenant in any respect for money damages by reason of
withholding its consent.


                                   ARTICLE 13

                            Moving of Heavy Equipment

                  Tenant shall not move any safe, heavy equipment or bulky
matter in or out of the Building without Landlord's written consent, which shall
not be unreasonably withheld. If the movement of such items requires special
handling, Tenant agrees to employ only persons holding a Master Rigger's License
to do said work and all such work shall be done in full compliance with the
Administrative Code of the City of New York and other municipal requirements.
All such movements shall be made during hours which will least interfere with
the normal operations of the Building, and all damage caused by such movement
shall be promptly repaired by Tenant at Tenant's expense.

                                       22
<PAGE>

                                   ARTICLE 14

                                  Condemnation

                  Section 14.01. In the event that the whole or more than ten
(10%) percent of the Demised Premises shall be condemned or taken in any manner
for any public or quasi-public use, this Lease and the term and estate hereby
granted shall forthwith cease and terminate as of the date of vesting of title.
In the event that ten (10%) percent of less of the Demised Premises shall be so
condemned or taken, then, effective as of the date of vesting of title, the
minimum rent and additional rent hereunder for such part shall be equitably
abated and this Lease shall continue as to such part not so taken. In the event
that only a part of the Building shall be so condemned or taken, then (a) if
substantial structural alteration or reconstruction of the Building shall, in
the reasonable opinion of Landlord, be necessary or appropriate as a result of
such condemnation or taking (whether or not the Demised Premises be affected),
Landlord may, at its option, terminate this Lease and the term and estate hereby
granted as of the date of such vesting of title by notifying Tenant in writing
of such termination within sixty (60) days following the date on which Landlord
shall have received notice of the vesting of title, or (b) if Landlord does not
elect to terminate this Lease, as aforesaid, this Lease shall be and remain
unaffected by such condemnation or taking, except that the minimum rent and
additional rent shall be abated to the extent, if any, hereinbefore provided. In
the event that only a part of the Demised Premises shall be so condemned or
taken and this Lease and the term and estate hereby granted are not terminated
as hereinbefore provided, Landlord, out of the portion of the award allocated
for such purpose and to the extent such award is sufficient, will restore with
reasonable diligence the remaining structural portions of the Demised Premises
as nearly as practicable to the same condition as it was in prior to such
condemnation or taking.

                  Section 14.02. In the event of termination in any of the cases
hereinabove provided, this Lease and the term and estate hereby granted shall
expire as of the date of such termination with the same effect as if that were
the Expiration Date and the rent hereunder shall be apportioned as of such date.

                  Section 14.03. In the event of any condemnation or taking
hereinabove mentioned of all or a part of the Building, Landlord shall be
entitled to receive the entire award in the condemnation proceeding, including
any award made for the value of the estate vested by this Lease in Tenant, and
Tenant hereby expressly assigns to Landlord any and all right, title and
interest of Tenant now or hereafter arising in or to any such award or any part
thereof, and Tenant shall be entitled to receive no part of such award.
Notwithstanding the foregoing, Tenant may make a separate claim for Tenant's
moveable trade fixtures, undepreciated cost of Tenant's leasehold improvements
and moving expenses, provided the same shall not affect or reduce Landlord's
award.

                                       23
<PAGE>

                                   ARTICLE 15

             Entry, Right to Change Public Portions of the Building

                  Section 15.01. Tenant shall permit Landlord to erect, use and
maintain pipes and conduits in and through the walls, within the ceiling or
below the floors of the Demised Premises. Landlord, or its agents or designee
shall have the right, on prior written notice (except no notice in an
emergency), to enter the Demised Premises for the purpose of making such repairs
or alterations as Landlord shall desire, shall be required or shall have the
right to make under the provisions of this Lease, provided such work is made in
a manner not to unreasonably interfere with Tenant's regular business operations
in the Demised Premises; and shall also have the right to enter the Demised
Premises for the purpose of inspecting them or exhibiting them to prospective
purchasers or lessees of the Building or to prospective mortgagees or to
prospective assignees of any such mortgagees. Landlord shall, during the
progress of any work in the Demised Premises, be allowed to take all material
into and upon the Demised Premises that may be required for the repairs or
alterations above mentioned without the same constituting an eviction of Tenant
in whole or in part and the rent reserved shall in no wise abate, except as
otherwise provided in this Lease, while said repairs or alterations are being
made. However, Landlord shall use reasonable efforts to make such repairs or
alterations in a manner to minimize interference with the normal conduct of
Tenant's business in and access to the Demised Premises, and shall perform such
work in a workmanlike and efficient manner and not cause a reduction of square
footage or rearrangement of the Demised Premises, provided Landlord shall not be
required to employ overtime or premium labor.

                  Section 15.02. During the nine (9) months prior to the
expiration of the term of this Lease, Landlord may exhibit the Demised Premises
to prospective tenants.

                  Section 15.03. Landlord shall have the right at any time
without thereby creating an actual or constructive eviction or incurring any
liability to Tenant therefor, to change the arrangement or location of such of
the following as are not contained within the Demised Premises: entrances,
passageways, doors and doorways, corridors, elevators, stairs, toilets, and
other like public service portions of the Building, provided such changes do not
interfere with Tenant's access to or otherwise constitute a material
interference with Tenant's use and occupancy of the Demised Premises.

                  Section 15.04. Landlord shall have the right at any time to
name the Building as it desires and to change any and all such names at any time
thereafter.

                                       24
<PAGE>

                                   ARTICLE 16

                          Conditional Limitations, Etc.

                  Section 16.01. If at any time during the term of this Lease:

                           (a) Tenant shall file a petition in bankruptcy or
         insolvency or for reorganization or arrangement or for the appointment
         of a receiver of all or a portion of Tenant's property, or

                           (b) Any petition of the kind referred to in
         subdivision (a) of this Section shall be filed against Tenant and such
         petition shall not be vacated, discharged or withdrawn or this Lease
         reaffirmed within ninety (90) days, or

                           (c) Tenant shall be adjudicated a bankrupt by any
         court, or

                           (d) Tenant shall make an assignment for the benefit
         of creditors, or

                           (e) a permanent receiver shall be appointed for the
         property of Tenant by order of a court of competent jurisdiction by
         reason of the insolvency of Tenant (except where such receiver shall be
         appointed in an involuntary proceeding, if he shall not be withdrawn
         within ninety (90) days after the date of his appointment),

then Landlord, at Landlord's option, may terminate this Lease on five (5) days'
notice to Tenant, and upon such termination, Tenant shall quit and surrender the
Demised Premises to Landlord.

                  Section 16.02 (a) If Tenant assumes this Lease and proposes to
         assign the same pursuant to the provisions of the Bankruptcy Code, 11
         U.S.C. ss. 101 et seq. (the "Bankruptcy Code") to any person or entity
         who shall have made a bona fide offer to accept an assignment of this
         Lease on terms acceptable to Tenant, then notice of such proposed
         assignment, setting forth (i) the name and address of such person, (ii)
         all of the terms and conditions of such offer, and (iii) the adequate
         assurance to be provided Landlord to assure such person's future
         performance under the Lease, including, without limitation, the
         assurance referred to in section 365(b)(3) of the Bankruptcy Code,
         shall be given to Landlord by Tenant not later than twenty (20) days
         after receipt by Tenant but in no event later than ten (10) days prior
         to the date that Tenant shall make application to a court of competent
         jurisdiction for authority and approval to enter into such assignment
         and assumption, and Landlord shall thereupon have the prior

                                       25
<PAGE>

         right and option, to be exercised by notice to Tenant given at any time
         prior to the effective date of such proposed assignment, to accept an
         assignment of this Lease upon the same terms and conditions and for the
         same consideration, if any, as the bona fide offer made by such person,
         less any brokerage commissions which may be payable out of the
         consideration to be paid by such person for the assignment of this
         Lease.

                           (b) If this Lease is assigned to any person or entity
         pursuant to the provisions of the Bankruptcy Code, any and all monies
         or other considerations payable or otherwise delivered in connection
         with such assignment shall be paid or delivered to Landlord, shall be
         and remain the exclusive property of Landlord and shall not constitute
         property of Tenant or of the estate of Tenant within the meaning of the
         Bankruptcy Code. Any and all monies or other considerations
         constituting Landlord's Property under the preceding sentence not paid
         or delivered to Landlord shall be held in trust for the benefit of
         Landlord and shall be promptly paid to Landlord.

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

                           (d) Nothing contained in this Section shall, in any
         way, constitute a waiver of the provisions of this Lease relating to
         assignment. Tenant shall not, by virtue of this Section, have any
         further rights relating to assignment other than those granted in the
         Bankruptcy Code.

                           (e) Notwithstanding anything in this Lease to the
         contrary, all amounts payable by Tenant to or on behalf of Landlord
         under this Lease, whether or not expressly denominated as rent, shall
         constitute rent for the purposes of Section 502(b)(6) of the Bankruptcy
         Code.

                           (f) The term "Tenant" as used in this Section
         includes any trustee, debtor in possession, receiver, custodian or
         other similar officer.

                  Section 16.03. If this Lease shall terminate pursuant to the
provisions of Section 16.01:

                           (a) Landlord shall be entitled to recover from Tenant
         arrears in minimum rent and additional rent and, in addition thereto as
         liquidated damages, an amount equal to the difference between the

                                       26
<PAGE>

         minimum rent and additional rent for the unexpired portion of the term
         of this Lease which had been in force immediately prior to the
         termination effected under Section 16.01 of this Article and the fair
         and the reasonable rental value of the Demised Premises, on the date of
         termination, for the same period, both discounted at the rate of eight
         (8%) percent per annum to the date of termination; or

                           (b) Landlord shall be entitled to recover from Tenant
         arrears in minimum rent and additional rent and, in addition thereto as
         liquidated damages, an amount equal to the maximum allowed by statute
         or rule of law in effect at the time when and governing the proceedings
         in which such damages are to be proved, whether or not such amount be
         greater or less than the amount referred to in subdivision (a) of this
         Section.

                  Section 16.04. (a) If Tenant shall fail to make any payment of
         any minimum rent or additional rent when the same becomes due and
         payable, or if Tenant shall fail to cancel or discharge any lien
         referred to in Section 17.02, or if Tenant shall fail to deliver the
         certificate referred to in Article 26, or if the Demised Premises
         become vacant or deserted, and any such default shall continue for a
         period of ten (10) days after notice thereof by Landlord, or

                           (b) If Tenant shall be in default in the performance
         of any of the other terms, covenants and conditions of this Lease and
         such default shall not have been remedied within thirty (30) days after
         notice by Landlord to Tenant specifying such default and requiring it
         to be remedied; or where such default reasonably cannot be remedied
         within such period of thirty (30) days, if Tenant shall not have
         commenced the remedying thereof within such period of time and shall
         not be proceeding with due diligence to remedy it,

then Landlord, at Landlord's election, may terminate this Lease on five (5)
days' notice to Tenant, and upon such termination Tenant shall quit and
surrender the Demised Premises to Landlord.

                  Section 16.05. If this Lease shall terminate as provided in
this Article, or if Tenant shall be in default in the payment of minimum rent or
additional rent when the same become due and payable, and such default shall
continue for a period of ten (10) days after notice by Landlord to Tenant.

                           (a) Landlord may re-enter and resume possession of
         the Demised Premises and remove all persons and property therefrom
         either by summary dispossess proceedings or by a suitable action or
         proceeding, at

                                       27
<PAGE>

         law or in equity, or by force or otherwise, without being liable for
         any damages therefor, and

                           (b) Landlord may re-let the whole or any part of the
         Demised Premises for a period equal to, greater or less than the
         remainder of the then term of this Lease, at such rental and upon such
         terms and conditions as Landlord shall deem reasonable to any tenant it
         may deem suitable and for any use and purpose it may deem appropriate.
         Landlord shall not be liable in any respect for failure to re-let the
         Demised Premises or, in the event of such re-letting, for failure to
         collect the rent thereunder and any sums received by Landlord on a
         re-letting in excess of the rent reserved in this Lease shall belong to
         Landlord.

                  Section 16.06. If this Lease shall terminate as provided in
this Article or by summary proceedings (except as to any termination under
Section 16.01), Landlord shall be entitled to recover from Tenant as damages, in
addition to arrears in minimum rent and additional rent,

                           (a) an amount equal to (i) all reasonable expenses
         incurred by Landlord in recovering possession of the Demised Premises
         and in connection with the re-letting of the Demised Premises,
         including, without limitation, the cost of repairing, renovating or
         remodeling the Demised Premises, (ii) the reasonable cost of performing
         any work required to be done by Tenant under this Lease, (iii) the
         reasonable cost of placing the Demised Premises in the same condition
         as that in which Tenant is required to surrender them to Landlord under
         this Lease, and (iv) all brokers' commissions and reasonable legal fees
         incurred by Landlord in re-letting the Demised Premises, which amounts
         set forth in this subdivision (a) shall be due and payable by Tenant to
         Landlord at such time or times as they shall have been incurred; and

                           (b) an amount equal to the deficiency between the
         minimum rent and additional rent which would have become due and
         payable had this Lease not terminated and the net amount, if any, of
         rent collected by Landlord on re-letting the Demised Premises. The
         amounts specified in this subdivision shall be due and payable by
         Tenant on the several days on which such minimum rent and additional
         rent would have become due and payable had this Lease not terminated.
         Tenant consents that Landlord shall be entitled to institute separate
         suits or actions or proceedings for the recovery of such amount or
         amounts, and Tenant hereby waives the right to enforce or assert the
         rule against splitting a cause of action as a defense thereto.

                                       28
<PAGE>

                  Section 16.07. Tenant, for itself and for all persons claiming
through or under it, hereby waives any and all rights which are or may be
conferred upon Tenant by any present or future law to redeem the Demised
Premises after a warrant to dispossess shall have been issued or after judgment
in an action of ejectment shall have been made and entered.

                  Section 16.08. The words "re-enter" and "re-entry", as used in
this Article, are not restricted to their technical legal meanings.

                  Section 16.09. Landlord shall not be required to give any
notice of its intention to re-enter, except as otherwise provided in this Lease.

                  Section 16.10. In any action or proceeding brought by Landlord
against Tenant, predicated on a default in the payment of minimum rent or
additional rent, Tenant shall not have the right to and shall not interpose any
set-off or counterclaim of any kind whatsoever, other than a claim which would
be legally barred for failure to raise as a counterclaim in such action or
proceeding. If Tenant has any claim, Tenant shall be entitled only to bring an
independent action therefor; and if such independent action is brought by
Tenant, Tenant shall not be entitled to and shall not consolidate it with any
pending action or proceeding brought by Landlord against Tenant for a default in
the payment of minimum rent or additional rent.


                                   ARTICLE 17

                                Mechanic's Liens

                  Section 17.01. If, subject to and notwithstanding Landlord's
consent as required under this Lease, Tenant shall cause any changes,
alterations, additions, improvements, installations or repairs to be made to or
at the Demised Premises or shall cause any labor to be performed or material to
be furnished in connection therewith, neither Landlord nor the Demised Premises,
under any circumstances, shall be liable for the payment of any expense incurred
or for the value of any work done or material furnished, and all such changes,
alterations, additions, improvements, installations and repairs and labor and
material shall be made, furnished and performed upon Tenant's credit alone and
at Tenant's expense, and Tenant shall be solely and wholly responsible to
contractors, laborers, and materialmen furnishing and performing such labor and
material. Nothing contained in this Lease shall be deemed or construed in any
way as constituting the consent or request of Landlord, express or implied, to
any contractor, laborer or materialman to furnish to perform any such labor or
material.

                  Section 17.02. If, because of any act or omission of Tenant
any mechanic's or other lien, charge or order for the payment of money shall be
filed against

                                       29
<PAGE>

the Demised Premises or the Building or Landlord's estate as tenant under any
ground or underlying lease (whether or not such lien, charge or order is valid
or enforceable as such), for work claimed to have been for, or materials
furnished to, Tenant, Tenant, at Tenant's expense, shall cause it to be
cancelled or discharged of record by bonding or otherwise within twenty (20)
days after notice of such filing, and Tenant shall indemnify Landlord against
and save Landlord harmless from and shall pay all reasonable costs, expenses,
losses, fines and penalties, including, without limitation, reasonable
attorneys' fees resulting therefrom.


                                   ARTICLE 18

                Landlord's Right to Perform Tenant's Obligations

                  If Tenant shall default in the performance of any of the terms
or covenants and conditions of this Lease, Landlord, without being under any
obligation to do so and without hereby waiving such default, may remedy such
default for the account and at the expense of Tenant. Any payment made or
expense incurred by Landlord for such purpose (including, but not limited to,
reasonable attorneys' fees) with interest at the maximum legal rate, shall be
deemed to be additional rent hereunder and shall be paid by Tenant to Landlord
on demand, or at Landlord's election, added to any subsequent installment or
installments of minimum rent.


                                   ARTICLE 19

                           Covenant of Quiet Enjoyment

                  Landlord covenants that upon Tenant paying the minimum rent
and additional rent and observing and performing all the terms, covenants and
conditions of this Lease on Tenant's part to be observed and performed, Tenant
may peaceably and quietly enjoy the Demised Premises, subject nevertheless to
the terms and conditions of this Lease, and provided, however, that no eviction
of Tenant by reason of paramount title, the foreclosure of any mortgage nor or
hereafter affecting the Demised Premises or by reason of any termination of any
ground or underlying lease to which this Lease is subject and subordinate,
whether such determination is by operation of law, by agreement or otherwise,
shall be construed as a breach of this covenant nor shall any action be brought
against Landlord by reason thereof.

                                       30
<PAGE>

                                   ARTICLE 20

                                   Excavation

                  In the event that construction is to be commenced or an
excavation is made or authorized for building or other purposes upon land
adjacent to the Building, Tenant shall, if necessary, afford to the person or
persons causing or authorized to commence construction or cause such excavation
or to engage in such other purpose, license to enter upon the Demised Premises
for the purpose of doing such work as shall reasonably be necessary to protect
or preserve the Building, from injury or damage and to support the Building and
any new structure to be built by proper foundations, pinning and/or
underpinning, or otherwise.


                                   ARTICLE 21

                             Services and Equipment

         Section 21.01. Landlord shall, at its cost and expense:

                  (a) Provide operatorless passenger elevator service Mondays
         through Fridays from 8:00 A.M. to 6:00 P.M., holidays excepted. A
         passenger elevator will be available at all other times. A service
         elevator shall be available Mondays through Fridays, holidays excepted,
         only from 9:00 A.M. to 11:30 A.M. and from 2:30 P.M. to 5:30 P.M.

                  (b) Maintain and keep in good order and repair the central
         heating, ventilating and air-conditioning system installed by Landlord.
         The system will be operated by Landlord on Mondays through Fridays,
         holidays excepted, from 8:00 A.M. to 6:00 P.M. Said system is designed
         to be capable of maintaining, within tolerances normal in first-class
         office buildings, inside space conditions for any open floor averaging
         78 degrees Fahrenheit dry bulb and fifty (50%) percent relative
         humidity when outside conditions are 95 degrees Fahrenheit dry bulb and
         75 degrees Fahrenheit wet bulb, and a temperature of not lower than for
         any one floor an average of 68 degrees Fahrenheit when outside
         temperature is 50 degrees Fahrenheit or lower. The foregoing design
         conditions shall be based on an occupancy of not more than one (1)
         person per one hundred (100) square feet, and upon a combined lighting
         and standard electrical load not to exceed three (3) watts per usable
         square feet (excluding the Building HVAC), unless energy and/or water
         conservation laws or requirements of public authorities, shall mandate
         for any reduction in operation below said design criteria, in which
         case such equipment shall be operated in

                                       31
<PAGE>

         accordance therewith. Landlord represents that on the Commencement Date
         the HVAC system serving the Demised Premises will be in good operating
         condition.

                           (c) Provide Building standard cleaning services in
         Tenant's office space and public portions of the Building, except no
         services shall be performed Saturdays, Sundays and holidays, all in
         accordance with Schedule D attached hereto. If, however, any additional
         cleaning of the Demised Premises is to be done by Tenant, it shall be
         done at Tenant's sole expense, in a manner reasonably satisfactory to
         Landlord and no one other than persons approved by Landlord shall be
         permitted to enter the Demised Premises or the Building for such
         purpose. Tenant, at its own cost, may utilize its own employees or
         outside contractors to perform additional cleaning services in the
         Demised Premises, provided such employees or outside contractors do not
         cause any labor disruption, dispute or disturbance in or around the
         Building or violate Landlord's union contracts affecting the Building.
         If Tenant shall require additional cleaning services, Tenant may award
         a contract for such services to any contractor that is approved by
         Landlord; provided however, that prior to making such award, Tenant
         shall inform Landlord of the terms upon which such contractor shall
         provide such additional cleaning services and, in the event that
         Landlord's designated contractor can provide such additional cleaning
         services on equal or better terms, Tenant shall award such contract to
         Landlord's designated contractor. Tenant shall pay for the cost of the
         services performed by such designated contractor within ten (10) days
         after being billed.

                           (d) Furnish hot and cold water for lavatory and
         drinking purposes. If Tenant requires, uses or consumes water for any
         other purposes, Landlord may install a meter or meters or other means
         to measure Tenant's water consumption, and Tenant shall reimburse
         Landlord for the reasonable cost of the meter or meters and the
         installation thereof, and shall pay for the maintenance of said meter
         equipment and/or pay Landlord's reasonable cost of other means of
         measuring such water consumption by Tenant. Tenant shall pay to
         Landlord on demand the cost of all water consumed as measured by said
         meter or meters or as otherwise measured, including sewer rents,
         provided such meter covers only the Demised Premises.

                           (e) If Tenant shall require and request any of the
         foregoing services at times other than above provided, and if such
         request is made at least twenty-four (24) hours prior to the time when
         such additional services are required, Landlord will provide them and
         Tenant shall pay to Landlord promptly thereafter the charges therefor
         at the then Building standard rate charged to other tenants in the
         Building.

                                       32
<PAGE>

                  Section 21.02. Holidays shall be deemed to mean all federal
holidays, state holidays and Building Service Employees Union Contract holidays.

                  Section 21.03. Landlord reserves the right to interrupt,
curtail or suspend the services required to be furnished by Landlord under this
Lease when necessary by reason of accident, emergency, mechanical breakdown or
when required by any law, order or regulation of any Federal, State, County or
Municipal authority, or for any other cause beyond the control of Landlord.
Landlord shall use due diligence to complete all required repairs or other
necessary work as quickly as possible so that Tenant's inconvenience resulting
therefrom may be for as short a period of time as circumstances will reasonably
permit. Tenant shall not be entitled to nor shall Tenant make claim for any
diminution or abatement of minimum rent or additional rent or other
compensation, nor shall this Lease or any of the obligations of Tenant be
affected or reduced by reason of such interruption, curtailment, suspension,
work or inconvenience.

                  Section 21.04. Tenant shall reimburse Landlord promptly for
the actual reasonable out-of-pocket cost to Landlord of removal from the Demised
Premises and the Building of any refuse and rubbish of Tenant not covered by the
Cleaning Specifications (Schedule D) and Tenant shall pay all bills therefor
when rendered.

                  Section 21.05. If Tenant shall request Landlord to furnish any
services in addition to those hereinabove provided or perform any work not
required under this Lease, and Landlord agrees to furnish and/or perform the
same, Tenant shall pay to Landlord promptly thereafter the charges therefor,
which charges are deemed to be additional rent and payable as such.

                  Section 21.06. Tenant shall have access to the Demised
Premises 24 hours a day, 7 days a week, subject to emergencies, police power and
the provisions of Article 34.

                  Section 21.07. Tenant shall, at all times, have available for
its use a proportionate share of the available riser space in the Building to
connect to existing telephone and cable services.


                                   ARTICLE 22

                                   Escalation

                  Section 22.01. Taxes. Tenant shall pay to Landlord, as
additional rent, tax escalation in accordance with this Section:

                                       33
<PAGE>

                  (a) Definitions: For the purpose of this Section, the
following definitions shall apply:

                                    (i) The term "Tax Base Factor" shall mean
                  the real estate taxes for the Building Project for the period
                  from July 1, 2001 to June 30, 2002, as finally determined.

                                    (ii) The term "The Building Project" shall
                  mean the parcel of land described in Schedule B of this Lease
                  with all the present improvements existing and erected
                  thereon. Landlord represents that (i) there are no tax
                  abatements or phase-ins currently in effect covering the
                  Building Project and (ii) the tax lot covering the Building
                  Project consists only of the Building and the land on which
                  the Building is located.

                                    (iii) The term "comparative tax year" shall
                  mean the New York City real estate tax year commencing on July
                  1, 2002 and each subsequent New York City real estate tax
                  year. If the present use of July 1 - June 30 New York City
                  real estate tax year shall hereafter be changed, then such
                  changed tax year shall be used with appropriate adjustment for
                  the transition.

                                    (iv) The term "Real Estate Taxes" shall mean
                  the total of all taxes and special or other assessments
                  levied, assessed or imposed at any time by any governmental
                  authority: (a) upon or against the Building Project, and (b)
                  in connection with the receipt of income or rents from the
                  Building Project to the extent that same shall be in lieu of
                  all or a portion of any of the aforesaid taxes or assessments,
                  or additions or increases thereof. Income, franchise,
                  transfer, inheritance, estate, sales, corporate, mortgage
                  recording or capital stock taxes of Landlord, or penalties or
                  interest thereon, shall be excluded from "Real Estate Taxes"
                  for the purposes hereof. If, due to a future change in the
                  method of taxation or in the taxing authority, or for any
                  other reason, a franchise, income, transit, profit or other
                  tax or governmental imposition, however designated, shall be
                  levied against Landlord in substitution in whole or in part
                  for the Real Estate Taxes, or in lieu of or addition to or
                  increase of Real Estate Taxes, then such franchise, income,
                  transit, profit or other tax or governmental imposition shall
                  be included within "Real Estate Taxes." Tenant acknowledges
                  that the Tax Escalation

                                       34
<PAGE>

                  Payment (as hereinafter defined) constitutes a method by which
                  Landlord is seeking to compensate for increases in expenses
                  and that the Tax Escalation Payment shall be calculated and
                  paid by Tenant to Landlord whether or not Real Estate Taxes
                  have then been paid by Landlord.

                               (v) The term "the Percentage" for purposes of
                  computing tax escalation, shall mean 0.5688%.

                           (b) (i) In the event that the Real Estate Taxes
                  payable for any comparative tax year shall exceed the Tax Base
                  Factor, Tenant shall pay to Landlord, as additional rent for
                  such comparative tax year, an amount for tax escalation ("Tax
                  Escalation Payment")equal to the Percentage of the excess.
                  Before or after the start of each Comparative Tax Year,
                  Landlord shall furnish to Tenant a statement of the Tax
                  Escalation Payment payable for such Comparative Tax Year,
                  together with a copy of the tax bill. Tenant shall make its
                  aforesaid Tax Escalation Payment to Landlord, in installments
                  in the same manner and not later than thirty (30) days prior
                  to the last date that Real Estate Taxes are payable by
                  Landlord to the governmental authority. If a statement is
                  furnished to Tenant after the commencement of the Comparative
                  Tax Year in respect of which such statement is rendered,
                  Tenant shall, within ten (10) days thereafter, pay to Landlord
                  an amount equal to those installments of the total Tax
                  Escalation Payment then due. If, during the term of this
                  Lease, Real Estate Taxes are required to be paid, in full or
                  in monthly or other installments, on any other date or dates
                  than as presently required, or if Landlord shall be required
                  to make monthly deposits of Real Estate Taxes to the holder of
                  any mortgage, then Tenant's Tax Escalation Payment(s) shall be
                  correspondingly adjusted so that the same are due to Landlord
                  in corresponding installments not later than thirty (30) days
                  prior to the last date on which the applicable installment of
                  such Real Estate Taxes shall be due and payable to the
                  governmental authority or such mortgagee.

                               (ii) If in any tax certiorari proceeding
                  regarding Real Estate Taxes payable for any Comparative Tax
                  Year or in otherwise establishing such taxes, Landlord has
                  incurred expenses for legal and/or consulting services
                  rendered in applying for, negotiating or obtaining a reduction
                  of the assessment upon which the Real Estate Taxes are

                                       35
<PAGE>

                  predicated, Tenant shall pay an amount equal to the Percentage
                  of such expenses.

                                    (iii) The statements of the Tax Escalation
                  Payment to be furnished by Landlord as provided above shall
                  constitute a final determination as between Landlord and
                  Tenant of the Tax Escalation Payment for the periods
                  represented thereby, except for mathematical error in
                  computation.

                                    (iv) In no event shall the fixed minimum
                  rent under this Lease be reduced by virtue of this Section
                  22.01.

                                    (v) Upon the date of any expiration or
                  termination of this Lease, whether the same be the date
                  hereinabove set forth for the expiration of the term or any
                  prior or subsequent date, a proportionate share of the Tax
                  Escalation Payment for the Comparative Tax Year during which
                  such expiration or termination occurs shall immediately become
                  due and payable by Tenant to Landlord, if it was not
                  theretofore already billed and paid, or due and payable by
                  Landlord to Tenant if the amount paid by Tenant exceeded such
                  proportionate share. The said proportionate share shall be
                  based upon the length of time that this Lease shall have been
                  in existence during such Comparative Tax Year. Prior to or
                  promptly after said expiration or termination, Landlord shall
                  compute the Tax Escalation Payment due from or owed to Tenant,
                  as aforesaid and Tenant shall promptly pay Landlord any amount
                  unpaid. If Landlord shall receive a refund or a tax credit of
                  any amount of Real Estate Taxes for any Comparative Tax Year
                  for which Tenant has made a payment, Landlord shall pay to
                  Tenant within fifteen (15) days of its receipt of such refund
                  the Percentage of any such refund, less the Percentage of any
                  legal fees and other expenses provided for in Section
                  22.01(b)(ii) to the extent the same have not theretofore been
                  paid by Tenant.

                                    (vi) Landlord's and Tenant's obligations to
                  make the adjustments referred to in subdivision (v) above
                  shall survive any expiration or termination of this Lease.

                                    (vii) Any delay or failure of Landlord in
                  billing any Tax Escalation Payment hereinabove provided shall
                  not constitute a waiver of or in any way impair the continuing
                  obligation of Tenant to pay such Tax Escalation Payment
                  hereunder, provided such billing is made within 24 months
                  after the expiration of the Comparative Tax Year in question.

                                       36
<PAGE>

                                    (viii) Notwithstanding any language to the
                  contrary in this Lease, Landlord and Tenant agree that for the
                  purposes of this Section 22.01, Real Estate Taxes and Tax
                  Escalation Payments shall be calculated without regard to any
                  deductions, credits, abatements, or deferral of Real Estate
                  taxes which Landlord may receive pursuant to Sections 11.256
                  through 11-267 of the Administrative Code of the City of New
                  York, authorized by Title 2-D of Article 4 of the New York
                  real Property Tax Law and any and all rules and regulations
                  promulgated thereunder (herein collectively called the "ICIP
                  Program").

                  Section 22.02. Porter's Wage Rate. Tenant shall pay to the
Landlord, as additional rent, a porter's wage rate escalation in accordance with
this Section:

                           (a) For the purpose of this Section, the following
                  definitions shall apply:

                                    (i) "Wage Rate" shall mean the minimum
                  regular hourly rate of wages in effect as of January 1st of
                  each year (whether paid by Landlord or any contractor employed
                  by Landlord) computed as paid over a forty hour week to
                  Porters in Class A office buildings pursuant to an Agreement
                  between Realty Advisory Board on Labor Relations,
                  Incorporated, or any successor thereto, and Local 32B-32J of
                  the Building Service Employees International Union, AFL-CIO,
                  or any successor thereto; and provided, however, that if there
                  is no such agreement in effect prescribing a wage rate for
                  Porters, computations and payments shall thereupon be made
                  upon the basis of the regular hourly wage rate actually
                  payable in effect as of January 1st of each year, and
                  provided, however, that if in any year during the term, the
                  regular employment of Porters in the Building shall occur on
                  days or during the hours when overtime or other premium pay
                  rates are in effect pursuant to such Agreement, then the term
                  "hourly rate of wages" as used herein shall be deemed to mean
                  the average hourly rate for the hours in a calendar week
                  during which Porters are regularly employed (e.g., if pursuant
                  to an

                                       37
<PAGE>

                  agreement between Realty Advisory Board and the Local the
                  regular employment of Porters for forty hours during a
                  calendar week is at a regular hourly wage rate of $3.00 for
                  the first thirty hours, and premium or overtime hourly wage
                  rate of $4.50 for the remaining ten hours, then the hourly
                  rate of wages under this Article during such period shall be
                  the total weekly rate of $135.00 divided by the total number
                  of regular hours of employment, forty or $3.375).
                  Notwithstanding the foregoing, if at any time such hourly wage
                  rate is different for new hire and old hire Porters, then
                  thereafter such hourly wage rate shall be based on the
                  weighted average of the wage rates for the different
                  classifications of Porters employed in the Building.

                                    (ii) "Base Wage Rate" shall mean the Wage
                  Rate in effect during the calendar year 2001.

                                    (iii) The term "Porters" shall mean that
                  classification of non-supervisory employees employed in and
                  about the Building who devote a major portion of their time to
                  general cleaning, maintenance and miscellaneous services
                  essentially of a non-technical and non-mechanical nature and
                  are the type of employees who are presently included in the
                  classification of "Class A-Others" in the Commercial Building
                  Agreement between the Realty Advisory Board and the aforesaid
                  Union.

                                    (iv) The term "minimum regular hourly rate
                  of wages" shall not include any payments for fringe benefits
                  and adjustments of any kind.

                                    (v) The term "fringe benefits" shall
                  include, without limitation, holiday and vacation pay, sick
                  pay, welfare and pension fund contributions, accident, health
                  and welfare programs, pension plans, guaranteed pay plans and
                  supplemental unemployment benefit plans and supplemental
                  unemployment benefit plans and supplemental unemployment
                  plans, training fund contributions, pay for days allowed for
                  clinics, birthdays and other days off, and other benefit
                  plans, payments and programs of similar or dissimilar nature,
                  whether or not required under any applicable law, regulation
                  or otherwise.

                                       38
<PAGE>

                                    (vi) The term "Multiplication Factor" shall
                  mean 3,100.

                           (b) If the Wage Rate for any calendar year during the
         term shall be increased above the Base Wage Rate, then Tenant shall
         pay, as additional rent, an amount equal to the product obtained by
         multiplying the Multiplication Factor by 100% of the number of cents
         (including any fraction of a cent) by which the Wage Rate is greater
         than the Base Wage Rate, such payment to be made in equal one-twelfth
         (1/12th) monthly installments commencing with the first monthly
         installment of minimum rent falling due on or after the effective date
         of such increase in Wage Rate (payable retroactive from said effective
         date) and continuing thereafter until a new adjustment shall have
         become effective in accordance with the provisions of this Article.
         Landlord shall give Tenant notice of each change in Wage Rate which
         will be effective to create or change Tenant's obligation to pay
         additional rent pursuant to the provisions of this Section 22.02 and
         such notice shall contain Landlord's calculation in reasonable detail
         and certified as true by an authorized partner of Landlord or of its
         managing agent, of the annual rate of additional rent payable resulting
         from such increase in Wage Rate. Such amounts shall be prorated for any
         partial calendar years during the term.

                           (c) Every notice given by Landlord pursuant to
         Section 22(b) hereof shall be conclusive and binding upon Tenant,
         except for error in computation or any other error.

                           (d) The "Wage Rate" is intended to be a substitute
         comparative index of economic costs and does not necessarily reflect
         the actual costs of wages or other expenses of operating the Building.
         The Wage Rate shall be used whether or not the Building is a Class A
         office building and whether or not Porters are employed in the Building
         and without regard to whether such employees are members of the Union
         referred to in subsection (a) hereof.


                                   ARTICLE 23

                              Electricity Inclusion

                  Section 23.01.

                           (a) Landlord shall furnish electric energy on a rent
         inclusion basis to the Demised Premises, the charges therefor, in the
         present amount

                                       39
<PAGE>

         of $9,300, being included in the minimum rent. The amount included in
         the minimum rent is based upon the normal use of such electric energy
         between the hours of 9:00 A.M. to 5:30 P.M. on Mondays through Fridays,
         holidays excepted, for lighting and for the normal use of lamps,
         typewriters, personal computers and similar customary office machines.
         Landlord shall not be liable in any way for any loss, damage or expense
         that Tenant may sustain or incur by reason of for any failure, change,
         interruption or defect in the supply or character of electric energy
         furnished to the Demised Premises by reason of any requirement, act or
         omission of the Electric Service Provider or Alternate Service Provider
         (as said terms are hereinafter defined) serving the Building with
         electricity and no such failure, change, interruption or defect shall
         constitute an actual of constructive eviction, in whole or in part, or
         entitle Tenant to any abatement of minimum rent or additional rent or
         relieve Tenant of its obligations under this Lease. Tenant shall
         furnish and install, at its sole cost and expense, all lighting
         fixtures, tubes, lamps, bulbs, ballasts and outlets relating to
         Tenant's electrical equipment.

                           (b) Landlord has advised Tenant that presently Con
         Edison ("Electric Service Provider") is the utility company selected by
         Landlord to provide electricity service for the Building.
         Notwithstanding the foregoing, if permitted by law, Landlord shall have
         the right at any time and from time to time during the term of this
         Lease to either contract for service from a different company or
         companies providing electricity service (each such company shall
         hereinafter be referred to as an "Alternate Service Provider") or
         continue to contract for service from the Electric Service Provider.

                           (c) Tenant, without expense, shall cooperate with
         Landlord, the Electric Service Provider, and any Alternate Service
         Provider at all times and, as reasonably necessary, shall allow
         Landlord, Electric Service Provider, and any Alternate Service Provider
         reasonable access to the Building's electric lines, feeders, risers,
         wiring, and any other machinery within the Demised Premises.

                  Section 23.02. Tenant's use of electric energy in the Demised
Premises, including lighting, shall not at any time exceed the capacity of any
of the electrical conductors and equipment in or servicing the Demised Premises,
provided that at all times the capacity shall not fall below five (5) watts per
usable square foot. In order to insure that such capacity is not exceeded and to
avert possible adverse effect upon the Building electric service, Tenant shall
not, without Landlord's prior consent in each instance, which consent shall not
be unreasonably withheld or delayed, connect any additional fixtures, appliances
or equipment (other than as set forth in Section 23.01) or make any alteration
or addition to the electric system of the Demised Premises existing on the
Commencement Date. Should Landlord grant such consent, all additional risers or

                                       40
<PAGE>

other equipment required therefor shall be provided by Landlord and the
reasonable cost thereof shall be paid by Tenant upon Landlord's demand. As a
condition to granting such consent, Landlord may require Tenant to agree to an
increase in the annual minimum rent by an amount which will reflect the cost to
Tenant of the additional service to be furnished by Landlord, that is the
potential additional electrical energy to be made available to Tenant based upon
the estimated additional capacity of such additional risers or other equipment.
If Landlord and Tenant cannot agree thereon, the amount of such increase shall
be determined by a reputable, independent electrical engineer or consultant, to
be selected by Landlord whose fees or charges shall be shared by Landlord and
Tenant. When the amount of such increase is so determined, Tenant shall pay to
Landlord within ten (10) days following notification to Tenant of such
determination the amount thereof retroactive to the date of such increased
usage, unless within such ten (10) day period Tenant disputes such
determination. If Tenant disputes such determination, it shall, at its own
expense, obtain from a reputable, independent electrical engineer or consultant,
its own survey of the additional electrical energy consumed by Tenant. Tenant's
consultant and Landlord's consultant shall then seek to agree on a finding of
such determination of such change in the consumption of electrical energy. If
they cannot agree, they shall choose a third reputable, independent electrical
engineer or consultant, whose cost shall be shared equally by Landlord and
Tenant, to make a similar survey, and the determination of such third consultant
shall be controlling. If they cannot agree on such third consultant, within ten
(10) days, then either party may apply to the Supreme Court in the County of New
York, for the appointment of such third consultant. However, pending such
determination, Tenant shall pay to Landlord the amount as determined by
Landlord's engineer or consultant. If the amount determined as aforesaid is
different from that determined by Landlord's engineer or consultant, then
Landlord and Tenant shall make adjustment for any deficiency owed by Tenant or
overage paid by Tenant. Following the final determination, the parties shall
execute an agreement supplementary hereto to reflect such increase in the annual
minimum rent and in the amount set forth in Section 23.03; but such increase
shall be effective even if such supplementary agreement is not executed.

                  Section 23.03. If, during the term of this Lease, the public
utility rate for the supply of electric current to the Building by the Electric
Service Provider or Alternate Service Provider shall be increased or if there
shall be an increase in taxes or if additional taxes shall be imposed upon the
sale or furnishing of such electric energy (hereafter collectively as the
"cost") the annual minimum rent shall be increased by an amount arrived at by
multiplying $9,300 (or the sum to which said sum may have been increased
pursuant to the provisions of Section 23.02 or this Section 23.03 prior to the
effective date of the cost increases; such sum being referred to herein as the
"Rent Inclusion Factor") by the percentage of the increase of such cost. When
the amount of such increase is so determined, Landlord and Tenant shall execute
an agreement supplementary hereto to reflect such increase in the amount of the
minimum rent payable and effective from the effective date of such increase, but
such increase shall be effective from such date whether or not such a
supplementary agreement is executed. Landlord shall not review

                                       41
<PAGE>

the electrical consumption in the Demised Premises more than once in any 12
month period.

                  Section 23.04. Landlord reserves the right to discontinue
furnishing electric energy at any time, whether or not Tenant is in default
under this Lease, upon not less than thirty (30) days' notice to Tenant. If
Landlord exercises such right of discontinuance, this Lease shall continue in
full force and effect and shall be unaffected thereby, except only that, from
and after the effective date of such discontinuance, Landlord shall not be
obligated to furnish electric energy to Tenant, and the minimum rent payable
under this Lease shall be reduced by an amount per annum equal to the then
prevailing Rent Inclusion Factor. If Landlord so elects to discontinue
furnishing electric energy to Tenant, Tenant shall arrange to obtain electric
energy directly from the Electric Service Provider or Alternate Service
Provider, as the case may be. Notwithstanding the foregoing, Landlord shall not
discontinue furnishing electric energy until Tenant is able to obtain such
electric energy directly from said Electric Service Provider or Alternate
Service Provider, as the case may be. Such electric energy may be furnished to
Tenant by means of the then existing Building system feeders, risers and wiring
to the extent that they are available, suitable and safe for such purposes (it
being understood that Landlord shall do nothing which limits the availability or
compromises the safety of such riser unless required to do so by Governmental
Requirements). All meters and additional panel boards, feeders, risers, wiring
and other conductors and equipment which may be required to obtain electric
energy directly from such Electric Service Provider or Alternate Service
Provider, as the case may be, and which are to be located within the Demised
Premises, shall be installed by Landlord at its expense if such discontinuance
was voluntary, or installed by Landlord at Tenant's expense if such
discontinuance was required bylaw or the utility company. Thereafter, all of the
same shall be maintained by Tenant at its expense.

                  Section 23.05. At no time shall Tenant's connected electrical
load in the Demised Premises, including lighting, exceed five (5) watts per
usable square foot.

                  Section 23.06. If any additional charge or tax is imposed upon
Landlord with respect to electric energy furnished to Tenant by any federal,
state or municipal authority, Tenant, unless prohibited by law or by any
governmental authority having jurisdiction thereover, shall pay to Landlord,
within ten (10) days following Landlord's demand, accompanied by copies of all
relevant bills or back-up documentation, Tenant's pro rata share of such
additional charge or tax.

                                       42
<PAGE>

                                   ARTICLE 24

                                     Broker

                  Landlord and Tenant covenant and represent that the sole
brokers who negotiated and brought about this transaction were J. Grotto &
Assoc. and Cohen Brothers Realty Corporation and Landlord agrees to pay a
commission therefor as per separate agreements. Landlord and Tenant agree to
hold the other harmless against any claims for a brokerage commission arising
out of a breach by the other of the representations contained in this Article.


                                   ARTICLE 25

                         Subordination and Ground Lease

                  Section 25.01. This Lease is subject and subordinate to (a)
all ground and underlying leases on the Land and/or Building now or hereafter
existing, and (b) to all mortgages which may now or hereafter affect any such
ground and underlying leases or the Land and/or Building, and to all renewals,
modifications, amendments, consolidations, replacements or extensions of any of
the foregoing. This clause shall be self-operative and no further instrument of
subordination shall be required. However, in confirmation of such subordination,
Tenant, at any time and from time to time, shall execute promptly, and within
fifteen (15) days of such request, any certificate and document that Landlord
may reasonably request which reasonably evidences such subordination.

                  Section 25.02. (a) The Tenant covenants and agrees that if by
         reason of a default under any underlying lease (including an underlying
         lease through which the Landlord derives its leasehold estate in the
         Demised Premises), or under any mortgage such underlying lease and the
         leasehold estate of the Landlord in the Premises demised hereby is
         terminated, the Tenant will attorn to the then holder of the
         reversionary interest in the premises demised by this Lease and will
         recognize such holder as the Tenant's Landlord under this Lease, unless
         the lessor under such underlying lease or the holder of any such
         mortgage shall, in any proceeding to terminate such underlying lease or
         foreclose such mortgage, elects to terminate this Lease and the rights
         of Tenant hereunder provided, however, the holder of the reversionary
         interest shall not be (i) liable for any act or omission or negligence
         of Landlord under this Lease accruing prior to the date of such
         reversion of title; (ii) subject to any counterclaim, defense or
         offset, not expressly provided for in this Lease and asserted with
         reasonable promptness which theretofore shall have accrued to Tenant
         against Landlord; (iii) obligated to perform any work but excluding
         Landlord's

                                       43
<PAGE>

         maintenance, repair and restoration obligations hereunder accruing
         prior to the date of such reversion of title; (iv) bound by any
         previous modification or amendment of this Lease or by any previous
         prepayment of more than one (1) month's rent, unless such modification
         or prepayment shall have been approved in writing by the holder of such
         Mortgage; (v) obligated to repair the Demised Premises, or the
         Building, or any part thereof, in the event of any damage accruing
         prior to the date of such reversion of title beyond such repair as can
         reasonably be accomplished from the net proceeds of insurance actually
         made available to the then holder of the reversionary interest; or (iv)
         obligated to repair the Demised Premises or the Building, or any part
         thereof, in the event of partial condemnation of the Demised Premises
         or the Building, except to the extent that a condemnation award is made
         available therefor. Nothing contained in this subparagraph shall be
         construed to impair any right otherwise exercisable by any such holder.
         Tenant agrees to execute and deliver, at any time and from time to
         time, within fifteen (15) days after the request of the Landlord of or
         the lessor under any such underlying lease or the holder of any such
         mortgage any instrument which may be necessary or appropriate to
         evidence such attornment. The Tenant further waives the provisions of
         any statute or rule or law now or hereafter in effect which may give or
         purport to give Tenant any right of election to terminate this Lease or
         to surrender possession of the premises demised hereby by reason of any
         proceeding is brought by the lessor under any underlying lease or the
         holder of any such mortgage to terminate the same, and agrees that
         unless and until any such lessor, in connection with any such
         proceeding, shall elect to terminate this Lease and the rights of
         Tenant hereunder, this Lease shall not be affected in any way
         whatsoever by any such proceeding.

                           (b) Upon Tenant's receipt of a written notice from
         the lessor under any underlying lease or the holder of any such
         mortgage to the effect that (i) the lessor of said underlying lease or
         the holder of any such mortgage is entitled to send a notice to the
         Landlord, as tenant under said underlying lease, terminating said
         lease, and (ii) the Tenant should pay the minimum rent and additional
         rent thereafter due and payable under this Lease to said lessor or the
         holder of any such mortgage at a place designated in such notice,
         Tenant shall pay such minimum rent and additional rent to said lessor
         under said underlying lease or the holder of any such mortgage at such
         designated place until such time as said lessor or holder shall notify
         Tenant that Landlord is no longer in default under said underlying
         lease or such mortgage and that Tenant may resume paying all minimum
         rent and additional rent thereafter due and payable under this Lease to
         Landlord. Tenant shall have no liability to the Landlord for paying any
         minimum rent or additional rent to said lessor under the underlying
         lease

                                       44
<PAGE>

         or holder of any such mortgage or otherwise acting in accordance with
         the provisions of any notice sent to it under this paragraph and shall
         be relieved of its obligations to pay Landlord any minimum rent or
         additional rent under this Lease to the extent such payments are made
         to said lessor under the underlying lease.

                  Section 25.03. In the event of any act or omission by Landlord
which would give Tenant the right to terminate this Lease or to claim a partial
or total eviction, pursuant to the terms of this Lease, if any, Tenant will not
exercise any such right until:

                           (a) it has given written notice to cure (whether
         concurrently with or subsequent to any notice given to Landlord),
         regarding such act or omission to the holder of any leasehold mortgage
         and to the landlord of any ground or underlying lease, whose names and
         addresses shall previously have been furnished to Tenant, addressed to
         such holder and landlord at the last addresses so furnished, and

                           (b) a reasonable period of time (not to exceed the
         period in this Lease or the ground lease or the mortgage, as the case
         may be) for remedying such act or omission shall have elapsed following
         such giving of notice during which such parties, or any of them, with
         reasonable diligence, following the giving of such notice, shall not
         have commenced and is or are not continuing to remedy such act or
         omission or to cause the same to be remedied.

                  Section 25.04. If, in connection with obtaining financing for
the Building, or of Landlord's interest in any ground or underlying lease, a
banking, insurance or other recognized institutional lender shall request
modifications in this Lease as a condition to such financing, Tenant will not
withhold, delay or defer its consent thereto and its execution and delivery of
such modification agreement, provided that such modifications do not increase
the obligations or decrease the rights of Tenant hereunder or adversely affect
the leasehold interest hereby created or Tenant's use and enjoyment of the
Demised Premises. Landlord represents that there is no present ground lease
covering the Building Project and the only mortgage covering the same is held by
Credit Suisse First Boston Mortgage Capital LLC.

                                       45
<PAGE>

                                   ARTICLE 26

                              Estoppel Certificate

                  Each party shall at any time, and from time to time, within
ten (10) days after so requested by the other party execute, acknowledge and
deliver to the other party, a statement addressed to the other party (a)
certifying that this Lease is unmodified and in full force and effect (or, if
there have been modifications, that the same is in full force and effect as
modified and stating the modifications), (b) stating the dates to which the
minimum rent and additional rent have been paid, (c) stating whether or not, to
such party's knowledge there exists any default by the other party under this
Lease, and, if so, specifying each such default, and (d) with respect to both
parties, such other information as may be reasonably required by Landlord or any
mortgagee, assignee or sublessee, it being intended that any such statement may
be relied upon by the other, by any mortgagee or prospective mortgagee of any
mortgage affecting the Building or the leasehold estate under any ground or
underlying lease affecting the land described in Schedule C and/or Building and
improvements thereon, or may be relied upon by the landlord under any such
ground or underlying lease or a purchaser of Lessee's estate under any such
ground or underlying lease or any interest therein, or by Tenant or its
permitted assignee or sublease.


                                   ARTICLE 27

                              Waiver of Jury Trial

                  Tenant hereby waives the right to trial by jury in any summary
proceeding that may hereafter be instituted against it or in any action or
proceeding that may be brought by Landlord on matters which are connected with
this Lease, or any of its provisions or Tenant's use or occupancy of the Demised
Premises, including any claims for injury or damage, or any emergency or other
statutory remedy with respect thereto.


                                   ARTICLE 28

                              Surrender of Premises

                  Section 28.01. Upon the expiration or other termination of the
term of this Lease, Tenant shall quit and surrender the Demised Premises in at
least the same condition as received, ordinary wear and tear and damage by fire
or other casualty excepted, and shall remove all its property therefrom, except
as otherwise provided in this Lease. Tenant's obligation to observe or perform
this covenant shall survive the expiration or other termination of the term of
this Lease.

                                       46
<PAGE>

                  Section 28.02. In the event Tenant shall remain in possession
of the Demised Premises after the expiration or other termination of the term of
this Lease, such holding over shall not constitute a renewal or extension of
this Lease. Landlord, may, at its option, elect to treat Tenant as one who is
not removed at the end of the term, and thereupon be entitled to all of the
remedies against Tenant provided by law in that situation or Landlord may elect
to construe such holding over as a tenancy from month-to-month, subject to all
of the terms and conditions of this Lease, except as to the duration thereof,
and the minimum rent shall be due, in either of such events, at a monthly rental
rate equal to two (2) times the monthly installment of minimum rent which would
otherwise be payable for such month, together with any and all additional rent.


                                   ARTICLE 29

                              Rules and Regulations

                  Section 29.01. Tenant, its servants, employees, agents,
visitors and licensees shall observe faithfully and comply with the rules and
regulations set forth in Schedule "C" attached hereto and made a part hereof.
Landlord shall have the right from time to time during the term of this Lease to
make reasonable changes in and additions to the rules thus set forth, provided
the same do not materially increase Tenant's obligations or decrease Tenant's
rights hereunder. Any inconsistencies between this Lease and the rules and
regulations shall be resolved in favor of this Lease.

                  Section 29.02. Any failure by Landlord to enforce any rules
and regulations now or hereafter in effect, either against Tenant or any other
tenant in the Building, shall not constitute a breach hereunder or waiver of any
such rules and regulations, provided Landlord shall not knowingly enforce such
rules and regulations in a discriminatory manner.


                                   ARTICLE 30

                     Successors and Assigns and Definitions

                  Section 30.01. The covenants, conditions and agreements
contained in this Lease shall bind and enure to the benefit of Landlord and
Tenant and their respective distributees, legal representatives, successors and,
except as otherwise provided herein, their assigns.

                  Section 30.02. The term "Landlord" as used in this Lease, so
far as the covenants and agreements on the part of Landlord are concerned shall
be limited to mean

                                       47
<PAGE>

and include only the owner or owners at the time in question of the tenant's
estate under any ground or underlying lease covering the Land described in
Schedule B hereto annexed and/or the fee title Landlord covering Land and/or the
Building and improvements thereon. In the event of any assignment or assignments
of such tenant's estate or transfer of such title, Landlord herein named (and in
case of any subsequent assignment or transfer, the then assignor or transferor)
shall be automatically freed and relieved from and after the date of such
assignment of all personal liability as respects to performance of any of
Landlord's covenants and agreements thereafter to be performed, and such
assignee or transferee shall be bound by all of such covenants and agreements;
it being intended that Landlord's covenants and agreements shall be binding on
Landlord, its successors and assigns only during and in respect of their
successive periods of such ownership.

                  However, in any event, the members in Landlord shall not have
any personal liability or obligation by reason of any default by Landlord under
any of Landlord's covenants and agreements in this Lease. In case of such
default, Tenant will look only to Landlord's estate, as tenant, under such
ground or underlying lease and its interest in the Building or any net sales
proceeds realized therefrom, to recover any loss or damage resulting therefrom;
and Tenant shall have no right to nor shall Tenant assert any claim against nor
have recourse to Landlord's other property or assets to recover such loss or
damage.

                  Section 30.03. All pronouns or any variation thereof shall be
deemed to refer to masculine, feminine or neuter, singular or plural as the
identity of the person or persons may require; and if Tenant shall consist of
more than one (1) person, the obligations of such persons, as Tenant, under this
Lease, shall be joint and several.

                  Section 30.04. The definitions contained in Schedule E annexed
hereto are hereby made a part of this Lease.

                                       48
<PAGE>

                                   ARTICLE 31

                                     Notices

                  Any notice, statement, certificate, request, approval, consent
or demand required or permitted to be given under this Lease shall be in writing
sent by registered or certified mail (or reputable, commercial overnight courier
service) return receipt requested, addressed, as the case may be, to Landlord,
at 750 Lexington Avenue, New York, New York 10022, and to Tenant prior to the
Commencement Date at ___________, and after the Commencement Date at the Demised
Premises, or to such other addresses as Landlord or Tenant respectively shall
designate in the manner herein provided. Such notice, statement, certificate,
request, approval, consent or demand shall be deemed to have been given on the
second day after the date when mailed, as aforesaid, or on the date of delivery
by overnight courier. A copy of any notice of default delivered by Landlord to
Tenant shall also be delivered in like manner to Tenant's counsel, Thelen Reid &
Priest LLP, 40 West 57th Street, New York, New York 10019, Attention: Lawrence
Brownridge, Esq.

                                   ARTICLE 32

                           No Waiver; Entire Agreement

                  Section 32.01. The specific remedies to which Landlord may
resort under the provisions of this Lease are cumulative and are not intended to
be exclusive of any other remedies or means of redress to which Landlord may be
lawfully entitled in case of any breach or threatened breach by Landlord of any
of the terms, covenants and conditions of this Lease. The failure of Landlord to
insist upon the strict performance of any of the terms, covenants and conditions
of this Lease, or to exercise any right or remedy herein contained, shall not be
construed as a waiver or relinquishment for the future of such term, covenant,
condition, right or remedy. A receipt by Landlord of minimum rent or additional
rent with knowledge of the breach of any term, covenant or condition of this
Lease shall not be deemed a waiver of such breach. This Lease may not be changed
or terminated orally. In addition to the other remedies in this Lease provided,
Landlord shall be entitled to seek to restrain by injunction, the violation or
attempted or threatened violation of any of the terms, covenants and conditions
of this Lease or to a decree by any court having jurisdiction in the matter,
compelling performance of any such terms, covenants and conditions.

                  Section 32.02. No receipt of monies by Landlord from Tenant,
after any re-entry or after the cancellation or termination of this Lease in any
lawful manner, shall reinstate the Lease; and after the service of notice to
terminate this Lease, or after commencement of any action, proceeding or other
remedy, Landlord may demand, receive and collect any monies due, and apply them
of account of Tenant's obligations under this

                                       49
<PAGE>

Lease but without in any respect affecting such notice, action, proceeding or
remedy, except that if a money judgment is being sought in any such action or
proceeding, the amount of such judgment shall be reduced by such payment.

                  Section 32.03. If Tenant is in arrears in the payment of
minimum rent or additional rent, Tenant waives its right, if any, to designate
the items in arrears against which any payments made by Tenant are to be
credited and Landlord may apply any of such payments to any such items in
arrears as Landlord, in its sole discretion, shall determine, irrespective of
any designation or request by Tenant as to the items against which any such
payments shall be credited.

                  Section 32.04. No payment by Tenant nor receipt by Landlord of
a lesser amount than may be required to be paid hereunder shall be deemed to be
other than on account of any such payment, nor shall any endorsement or
statement on any check or any letter accompanying any check tendered as payment
be deemed an accord and satisfaction and Landlord may accept such check or
payment without prejudice to Landlord's right to recover the balance of such
payment due or pursue any other remedy in this Lease provided.

                  Section 32.05. This Lease and the Schedules annexed hereto
constitute the entire agreement between Landlord and Tenant referable to the
Demised Premises, and all prior negotiations and agreements are merged herein.

                  Section 32.06. If any term or provision of this Lease or the
application thereof to any person or circumstance shall, to any extent, be
invalid or unenforceable, the remainder of this Lease, or the application of
such term or provision to persons or circumstances other than those as to which
it is held invalid or unenforceable, shall not be affected thereby, and each
term and provision of this Lease shall be valid and be enforced to the fullest
extent permitted by law.

                  Section 32.07. Tenant acknowledges that Landlord will contract
or has contracted with one or more providers of telecommunications services for
the installation of cable, wire and related electrical, electronic or mechanical
devices in the Building sufficient to provide telecommunications services to the
Demised Premises, and Tenant agrees to engage such a provider, as designated by
Landlord, to provide such services, unless another provider selected by Tenant
and reasonably approved by Landlord agrees to provide such services to Tenant at
a lower cost than the provider designated by Landlord. In such event Landlord
shall have the right to cause the service provider designated by Landlord to
match the cost and level of service chargeable by the provider selected by
Tenant, in which event Tenant agrees to engage the provider designated by
Landlord.

                                       50
<PAGE>

                  Section 32.08. It is understood and agreed that this Lease is
submitted to Tenant on the understanding that it shall not be considered an
offer and shall not bind Landlord in any way whatsoever until (i) Tenant has
duly executed and delivered duplicate originals to Landlord, and (ii) Landlord
has executed and delivered one of said fully executed originals to Tenant.


                                   ARTICLE 33

                                    Captions

                  The captions of Articles in this Lease are inserted only as a
matter of convenience and for reference and they in no way define, limit or
describe the scope of this Lease or the intent of any provision thereof.


                                   ARTICLE 34

                              Inability to Perform

                  Tenant's obligation to pay minimum rent and additional rent
and to perform all of the other terms, covenants and conditions of this Lease
shall not be affected, diminished, or excused if by reason of unavoidable delays
(as hereinafter defined) Landlord fails or is unable to supply any services or
make any repairs or perform any work which under this Lease Landlord has
expressly agreed to supply, make or perform, and the time for the performance or
observance thereof shall be extended for the period of time as Landlord shall
have been so delayed.

                  The words "unavoidable delays", as used in this Lease shall
mean (a) the enactment of any law or issuance of any governmental order, rule or
regulation (i) prohibiting or restricting performance of work of the character
required to be performed by Landlord under this Lease, or (ii) establishing
rationing or priorities in the use of materials, or (iii) restricting the use of
labor, and (b) strikes, lockouts, acts of God, inability to obtain labor or
materials, enemy action, civil commotion, fire, unavoidable casualty or other
similar types of causes beyond the reasonable control of Landlord, other than
financial inability.

                                       51
<PAGE>

                                   ARTICLE 35

                         No Representations by Landlord

                  Neither Landlord nor any agent or employee of Landlord has
made any representation whatsoever with respect to the Demised Premises except
as expressly set forth in this Lease.


                                   ARTICLE 36

                                Security Deposit

                  Section 36.01. Concurrently with the execution of this Lease,
Tenant shall deposit with Landlord the sum of $173,600, by Letter of Credit as
provided in Section 36.02, as security for the faithful performance and
observance by Tenant of the terms, provisions and conditions of this Lease.
Tenant agrees that, in the event that Tenant defaults in respect of any of the
terms, provisions and conditions of this Lease (including the payment of minimum
rent and additional rent), after any applicable notice and expiration of any
applicable cure period, Landlord may notify the "Issuing Bank" (as such term is
defined in Section 36.02) and thereupon receive all of the monies represented by
the said Letter of Credit and use, apply, or retain the whole or any part of
such proceeds, as the case may be, to the extent required for the payment of any
rent, additional rent, or any other sum as to which Tenant is in default, or for
any sum that Landlord may expend or may be required to expend by reason of
Tenant's default, in respect of any of the terms, covenants and conditions of
this Lease (including any damages or deficiency accrued before or after summary
proceedings or other re-entry by Landlord). In the event that Landlord applies
or retains any portion or all of the proceeds of such Letter of Credit Tenant
shall, within five (5) days after demand by Landlord, restore the amount so
applied or retained so that, at all times, the amount deposited shall be
$173,600. Upon Tenant's making such additional deposit, Landlord is hereby
authorized to act as Tenant's agent to use the proceeds of the Letter of Credit
to obtain a new Letter of Credit from the Issuing Bank or any other qualifying
bank (such qualifying bank shall then be the Issuing Bank). If Tenant shall fail
or refuse to make such additional deposit, Landlord shall have the same rights
in law and in equity and under this Lease as it has with respect to a default by
Tenant in the payment of minimum rent. The unapplied cash security or Letter of
Credit, as the case may be, shall be returned to Tenant within twenty (20) days
after the expiration date and after delivery of possession of the entire Demised
Premises to Landlord in the condition provided in this Lease for such delivery
of possession, unless Tenant is in default under the terms of this Lease, in
which event Landlord shall promptly return the remainder of the security after
such default has been cured.

                                       52
<PAGE>

                  Section 36.02. Such letter of credit (the "Letter of Credit")
shall be a clean, irrevocable and unconditional Letter of Credit issued by and
drawn upon any commercial bank (the "Issuing Bank") with offices for banking
purposes in the City of New York and having a combined capital and surplus of
not less than $500,000,000.00, which Letter of Credit shall have an initial term
of not less than one year or thereafter having a term expiring not less than
ninety (90) days following the expiration of the term of this Lease, shall
permit multiple drawings, shall be transferable by the beneficiary at one or
more occasions at no charge to the beneficiary and otherwise be in form and
content satisfactory to Landlord, be for the account of Landlord and be in the
amount of $173,600. Notwithstanding the foregoing, if at any time the combined
capital and surplus of the Issuing Bank is less than $500,000,000.00 or its
rating is downgraded from its current rating, and provided Tenant does not
replace the existing Letter of Credit with a Letter of Credit meeting the
criteria of Section 36.02 within the sooner of thirty (30) days following
Tenant's receipt of Landlord's notice to Tenant of either of the foregoing
events or the number of days remaining until the expiration date of the existing
Letter of Credit, Landlord shall have the right, at any time thereafter, to draw
down the entire proceeds pursuant to the terms of Section 36.01 as cash security
pending the replacement of such Letter of Credit. The Letter of Credit shall
provide that:

                           (a) the Issuing Bank shall pay to Landlord or its
         duly authorized representative an amount up to the face amount of the
         Letter of Credit upon presentation of the Letter of Credit and a sight
         draft, in the amount to be drawn;

                           (b) it shall be deemed automatically renewed, without
         amendment, for consecutive periods of one (1) year each thereafter
         during the term of this Lease, unless Issuing Bank sends written notice
         (hereinafter referred to as the Non-Renewal Notice) to Landlord by
         certified or registered mail, return receipt requested, not less than
         sixty (60) days next preceding the expiration date of the Letter of
         Credit that it elects not to have the Letter of Credit renewed, and it
         being agreed that the giving of such Non-Renewal Notice shall for the
         purpose of this Article 37 be deemed a default under this Lease, unless
         Tenant replaces the Letter of Credit with a substitute Letter of Credit
         meeting the criteria of this Section 36.02 or with a cash deposit at
         least thirty (30) days prior to the expiration date of the Letter of
         Credit.

                           (c) Landlord, subsequent to its receipt of a
         Non-Renewal Notice, and not more than 30 days prior to the expiration
         date of the Letter of Credit, shall have the right, exercisable by
         means of sight draft, to receive the monies represented by the Letter
         of Credit and hold such proceeds pursuant to the terms of Section 36.01
         as cash security pending the replacement of such Letter of Credit; and

                                       53
<PAGE>

                           (d) upon Landlord's sale or assignment of its estate
         as Tenant under any ground or underlying lease, the Letter of Credit
         shall be transferable by Landlord, as provided in Section 36.03.

                  Section 36.03. In the event Landlord's estate as tenant under
any ground or underlying Lease is sold or assigned, Landlord shall have the
right to transfer the Letter of Credit then held by Landlord to the vendee or
assignee, and Landlord shall thereupon be released by Tenant from all liability
for the return of such Letter of Credit, provided such assignee acknowledges
receipt of the Letter of Credit in writing to Tenant. In such event, Tenant
agrees to look solely to the new Landlord for the return of said Letter of
Credit. It is agreed that the provisions hereof shall apply to every transfer or
assignment made of the Letter of Credit to a new Landlord.

                  Section 36.04. Tenant covenants that it will not assign or
encumber, or attempt to assign or encumber, the Letter of Credit deposited
hereunder as security, and that neither Landlord nor its successors or assigns
shall be bound by any such assignment, encumbrance, attempted assignment, or
attempted encumbrance.

                  Section 36.05. The use of the security, as provided in this
Article, shall not be deemed or construed as a waiver of Tenant's default or as
a waiver of any other rights and remedies to which Landlord may be entitled
under the provisions of this Lease by reason of such default, it being intended
that Landlord's rights to use the whole or any part of the security shall be in
addition to but not in limitation of any such other rights and remedies; and
Landlord may exercise any of such other rights and remedies independent of or in
conjunction with its rights under this Article.

                  Section 36.06 To the extent Landlord retains any cash security
under this Lease, any interest earned thereon, less a one percent (1%) per annum
administrative charge, shall be paid to Tenant no less often than annually,
provided that Tenant is not then in default under the terms of this Lease.
However, Landlord shall not be obligated to deposit any cash security in an
interest bearing account.

                                       54
<PAGE>

                                   ARTICLE 37

                                  Rent Control

                  In the event the minimum rent and/or additional rent or any
part thereof provided to be paid by Tenant under the provisions of this Lease
during the demised term shall become uncollectible or shall be reduced or
required to be reduced or refunded by virtue of any federal, state, county or
city law, order or regulation, or by any direction of a public officer or body
pursuant to law, or the orders, rules, code or regulations of any organization
or entity formed pursuant to law, Tenant shall enter into such agreement(s) and
take such other steps (without additional expense or liability to Tenant) as
Landlord may reasonably request and as may be legally permissible to permit
Landlord to collect the maximum rents which from time to time during the
continuance of such legal rent restriction may be legally permissible (and not
in excess of the amounts reserved therefor under this Lease). Upon the
termination of such legal rent restriction, (a) the minimum rent and/or
additional rent shall become and thereafter be payable in accordance with the
amounts reserved herein for the periods following such termination, and (b)
Tenant shall pay to Landlord promptly upon being billed, to the maximum extent
legally permissible, an amount equal to (i) minimum rent and/or additional rent
which would have been paid pursuant to this Lease but for such legal rent
restriction less (ii) the rents paid by Tenant during the period such legal rent
restriction was in effect.


                                   ARTICLE 38

                              Late Payment Charges

                  If Tenant shall fail to pay any minimum rent or additional
rent within ten (10) days after its due date, Tenant shall pay a late charge of
$.05 for each $1.00 which remains unpaid after such period to compensate
Landlord for additional expense in processing such late payment. In addition, if
Tenant fails to pay any minimum rent or additional rent within fifteen (15) days
after its due date, Tenant shall pay interest thereon from the date due until
the date paid at the rate of one and one-half percent (1-1/2%), per month. If
any check of Tenant in payment of any sum due under this Lease, including but
not limited to minimum rent and additional rent, fails to clear the bank, Tenant
shall pay a charge of $250.00.

                                       55
<PAGE>

                  IN WITNESS WHEREOF, Landlord and Tenant have duly executed
this Lease as of the day and year first above written.


                            MADISON THIRD BUILDING COMPANIES LLC
                            By: Madison Third Building Companies, Corp.
                                its managing member


                            By: /s/ Charles Steven Cohen
                                   ----------------------------
                                Charles Steven Cohen, President
                                               Landlord

                            CONSTELLATION 3D, INC.


                            By: /s/ Eugene Levich
                                   ----------------------------
                                     Name:
                                     Title:
                                               Tenant

                                       56
<PAGE>

                          CERTIFICATE OF ACKNOWLEDGMENT



STATE OF NEW YORK    )
                     : ss.:
COUNTY OF NEW YORK   )


                  On the      day of         in the year 2001 before me, the
undersigned, a Notary Public in and said State, personally appeared Charles
Steven Cohen, personally known to me or proved to me on the basis of
satisfactory evidence to be the individual whose name is subscribed to the
within instrument and acknowledged to me that he executed the same in his
capacity, and that by his signature on the instrument, the individual, or the
person upon behalf of which the individual acted, executed the instrument.




                                  Notary Public




STATE OF NEW YORK    )
                     : ss.:
COUNTY OF NEW YORK   )



                  On the       day of         in the year 2001 before me, the
undersigned, a Notary Public in and said State, personally appeared , personally
known to me or proved to me on the basis of satisfactory evidence to be the
individual whose name is subscribed to the within instrument and acknowledged to
me that he executed the same in his capacity, and that by his signature on the
instrument, the individual, or the person upon behalf of which the individual
acted, executed the instrument.





                                ___________________________________
                                          Notary Public

                                       57
<PAGE>

                                   SCHEDULE A
                                   ----------

                                   Floor Plan

                                       58
<PAGE>

                                   SCHEDULE B
                                   ----------

                               Description of Land


                  All that lot, piece and parcel of land situate in the Borough
of Manhattan, City, County and State of New York, bounded and described as
follows:

                  BEGINNING at the corner formed by the intersection of the
southerly side of East 50th Street and the easterly side of Third Avenue;
running

                  THENCE southerly along the easterly side of Third Avenue 150
feet 5 inches;

                  THENCE easterly, parallel with East 49th Street 115 feet 2-1/2
inches;

                  THENCE southerly parallel with Third Avenue 50 feet 5 inches
to the northerly side of East 49th Street;

                  THENCE easterly along the northerly side of East 49th Street
40 feet 11-1/2 inches;

                  THENCE northerly parallel with Third Avenue 14 feet;

                  THENCE northwesterly 37 feet 3 inches to a point distant 149
feet 2-1/2 inches easterly of the easterly side of Third Avenue;

                  THENCE westerly parallel with East 49th Street 3 feet to the
center line of Old Post Road;

                  THENCE northerly along the center line of Old Post Road 74
feet 2-3/8 inches to a point distant 481 feet 3 inches west of the westerly side
of Second Avenue, and 78 feet 1-1/2 inches south of the southerly side of West
50th Street along a line drawn at right angles thereto;

                  THENCE easterly parallel with East 50th Street 31 feet 3
inches;

                  THENCE still easterly 6 feet 3 inches to a point distant 78
feet 1 inch from the southerly side of East 50th Street measured along a line
drawn at right angles thereto;

                  THENCE northerly parallel with Third Avenue and part of the
distance through a party wall, 78 feet 1 inch to the southerly side of East 50th
Street;

                                       59
<PAGE>

                  THENCE westerly along the southerly side of East 50th Street
166 feet 3 inches to the corner aforesaid, the point or place of BEGINNING.

                                       60
<PAGE>

                                   SCHEDULE C
                                   ----------

                              Rules and Regulations


                  1. The rights of tenants in the entrances, corridors,
elevators and escalators of the Building are limited to ingress to and egress
from the tenants' premises for the tenants and their employees, licensees,
guests, customers and invitees, and no tenant shall use, or permit the use of,
the entrances, corridors, escalators or elevators for any other purpose. No
tenant shall invite to the tenant's premises, or permit the visit of, persons in
such numbers or under such conditions as to interfere with the use and enjoyment
of any of the plazas, entrances, corridors, escalators, elevators and other
facilities of the Building by other tenants. Fire exits and stairways are for
emergency use only, and they shall not be used for any other purposes by the
tenants, their employees, licensees or invitees. No tenant shall encumber or
obstruct, or permit the encumbrance or obstruction of any of the sidewalks,
plazas, entrances, corridors, escalators, elevators, fire exits or stairways of
the Building. The Landlord reserves the right to control and operate the public
portions of the Building and the public facilities, as well as facilities,
furnished for the common use of the tenants, in such manner as it deems best for
the benefit of the tenants generally. Landlord further reserves the right, at
any time, to install a message/package center in an area in the Building
designated by Landlord and reasonably accessible to and for the common use of
tenant's, and the tenants shall comply with the reasonable procedures for the
same set forth by the Landlord.

                  2. The reasonable cost of repairing any damage to the public
portions of the Building or the public facilities or to any facilities used in
common with other tenants, caused by a tenant or the employees, licensees or
invitees of the tenant, shall be paid by such tenant.

                  3. The Landlord may refuse admission to the Building outside
of ordinary business hours to any person not known to the watchman in charge or
not having Landlord approved identification, and may require all persons
admitted to or leaving the Building outside of ordinary business hours to
register. Tenant's agents and visitors shall be permitted to enter and leave the
building after ordinary business hours whenever appropriate arrangements have
been previously made between the Landlord and the Tenant with respect thereto.
Each tenant shall be responsible for all persons for whom he requests such
permission and shall be liable to the Landlord for all acts of such persons. Any
person whose presence in the Building at any time shall, in the judgment of the
Landlord, be prejudicial to the safety, character, reputation and interests of
the Building or its tenants may be denied access to the Building or may be
rejected therefrom. In case of invasion, riot, public excitement or other
commotion the Landlord may prevent all access to the Building during the
continuance of the same, by closing the doors or otherwise, for the safety of
the tenants and protection of property in the Building. The Landlord may

                                       61
<PAGE>

require any person leaving the Building with any package or other object to
exhibit a pass from the tenant from whose premises the package or object is
being removed, but the establishment and enforcement of such requirement shall
not impose any responsibility on the Landlord for the protection of any tenant
against the removal of property from the premises of the tenant. The Landlord
shall, in no way, be liable to any tenant for damages or loss arising from the
admission, exclusion or ejection of any person to or from the tenant's premises
or the Building under the provisions of this rule.

                  4. No tenant shall obtain or accept for use in its premises
towel, barbering, boot blacking, floor polishing, lighting maintenance, cleaning
or other similar services from any persons not authorized by the Landlord in
writing to furnish such services, provided always that the charges for such
services by persons authorized by the Landlord are comparable to the industry
charge. Such services shall be furnished only at such hours, in such places
within the tenant's premises and under such reasonable regulations as may be
fixed by the Landlord.

                  5. No awnings or other projections over or around the windows
shall be installed by any tenant, and only such window blinds as are supplied or
permitted by the Landlord shall be used in a tenant's premises.

                  6. There shall not be used in any space, or in the public
halls of the Building, either by the Tenant or by jobbers or others, in the
delivery or receipt of merchandise, any hand trucks, except those equipped with
rubber tires and side guards.

                  7. All entrance doors in each tenant's premises shall be left
locked when the tenant's premises are not in use. Entrance doors shall not be
left open at any time. All windows in each tenant's premises if operable shall
be kept closed at all times and all blinds therein above the ground floor shall
be lowered when and as reasonably required because of the position of the sun,
during the operation of the Building air conditioning system to cool or
ventilate the tenant's premises.

                  8. No noise, including the playing of any musical instruments,
radio or television, which, in the judgment of the Landlord, might disturb other
tenants in the Building shall be made or permitted by any tenant. Nothing shall
be done or permitted in any tenant's premises, and nothing shall be brought into
or kept in any tenant's premises, which would impair or interfere with any of
the Building services or the proper and economic heating, cleaning or other
servicing of the Building or the premises, or the use or enjoyment by any other
tenant of any other premises, nor shall there be installed by any tenant any
ventilating, air conditioning, electrical or other equipment of any kind which,
in the judgment of the Landlord, might cause any such impairment or
interference. No dangerous, flammable, combustible or explosive object or
material shall be brought into the Building by any tenant or with the permission
of any tenant.

                                       62
<PAGE>

                  9. Tenant shall not permit any cooking or food odors emanating
within the Demised Premises to seep into other portions of the Building.

                  10. No acids, vapor or other materials shall be discharged or
permitted to be discharged into the waste lines, vents or flues of the Building
which may damage them. the water and wash closets and other plumbing fixtures in
or serving any tenant's premises shall not be used for any purpose other than
the purpose for which they were designed or constructed, and no sweepings,
rubbish, rags, acids or other foreign substances shall be deposited therein. All
damages resulting from any misuse of the fixtures shall be borne by the tenant
who, or whose servants, employees, agents, visitors or licensees, shall have
caused the same.

                  11. No signs, advertisement, notice or other lettering shall
be exhibited, inscribed, painted or affixed by any tenant on any part of the
outside or inside the premises or the Building without the prior written consent
of the Landlord. In the event of the violation of the foregoing by any tenant,
Landlord may remove the same without any liability, and may charge the expense
incurred by such removal to the tenant or tenants violating this rule. Interior
signs and lettering on doors and elevators shall be inscribed, painted, or
affixed for each tenant by Landlord at the expense of such tenant, (the charge
not to exceed that which a reputable outside contractor would charge), and shall
be of a size, color and style reasonably acceptable to Landlord. Landlord shall
have the right to prohibit any advertising by any tenant which impairs the
reputation of the building or its desirability as a building for offices, and
upon written notice from Landlord, Tenant shall refrain from or discontinue such
advertising.

                  12. No additional locks or belts of any kind shall be placed
upon any of the doors or windows in any tenant's premises and no lock on any
door therein shall be changed or altered in any respect. Upon the termination of
a tenant's lease, all keys of the tenant's premises and toilet rooms shall be
delivered to the Landlord.

                  13. No tenant shall use or occupy, or permit any portion of
the premises demised to such tenant to be used or occupied, as an office for a
public stenographer or typist, or as a barber or manicure shop, or as an
employment bureau. No tenant or occupant shall engage or pay any employees in
the Building, except those actually working for such tenant or occupant in the
Building.

                  14. Subject to the permitted uses provided in Section 4.01, no
premises shall be used, or permitted to be used, at any time, as a store for the
sale or display of goods, wares or merchandise of any kind, or as a restaurant,
shop, booth, bootblack or other stand, or for the conduct of any business or
occupation which predominantly involves direct patronage of the general public
in the premises demised to such tenant, or for manufacturing or for other
similar purposes.

                                       63
<PAGE>

                  15. The requirements of tenants will be attended only upon
application at the office of the Building. Employees of Landlord shall not
perform any work or do anything outside of the regular duties, unless under
special instructions from the office of the Landlord.

                                       64
<PAGE>

                  16. Each tenant shall, at its expense, provide artificial
light in the premises demised to such tenant for Landlord's agents, contractors
and employees while performing janitorial or other cleaning services and making
repairs or alterations in said premises, without the same causing an increase in
the Rent Inclusion Factor provided in Section 23.03.

                  17. The tenant's employees shall not loiter around the
hallways, stairways, elevators, front, roof or any other part of the Building
used in common by the occupants thereof.

                  18. If the premises demised to any tenant become infested with
vermin, such tenant, at its sole cost and expense, shall cause its premises to
be exterminated, from time to time, to the satisfaction of Landlord and shall
employ such exterminators therefor as shall be approved by Landlord.

                  19. No bicycle or other vehicle and no animals shall be
allowed in the showrooms, offices, halls, corridors or any other parts of the
Building.

                  20. Tenant shall not, without Landlord's prior written
consent, install or operate any heating device, refrigerating or air
conditioning equipment, steam or internal combustion engine, boiler, stove,
machinery or mechanical devices (other than for normal office use) upon the
premises or carry on any mechanical or manufacturing business thereon, or use or
permit to be brought into the Building flammable fluids such as gasoline,
kerosene, benzene or naphtha or use any illumination other than electric lights.
All equipment, fixtures, lamps and bulbs shall be compatible with, and not
exceed the capacity of the Building's electric system. No explosives, firearms,
radioactive or toxic or hazardous substances or materials, or other articles
deemed hazardous to life, limb or property shall be brought into the Building or
the Premises.

                  21. Tenant, its customers, invitees, licensees, agents,
servants, employees and guests shall not encumber or obstruct sidewalks,
entrances, passages, courts, vestibules, halls, elevators, stairways or other
common areas in or about the Building.

                  22. Tenant shall not allow anything to be placed against or
near the glass in the partitions between the premises and the halls or corridors
of the Building which shall diminish the light in the halls or corridors.

                                       65
<PAGE>

                  23. Upon termination of this Lease, Tenant shall surrender all
keys of the premises and of the Building and give to Landlord the explanation of
the combination of all locks on safes or vault doors in the Premises.

                  24. Tenant shall provide the Building Manager with keys to all
locks on any doors of the premises. The Building Manager shall be allowed
admittance to the premises in the event of any emergency, fire or other casualty
that may arise in other appropriate instances.

                  25. Unless otherwise advised by Landlord, neither Tenant nor
its employees shall undertake to regulate the radiator controls of thermostats.
Tenant shall report to the office of the Building whenever such thermostats or
radiator controls are not working properly or satisfactorily.

                  26. All window treatments that are visible from the street
shall be subject to Landlord's approval.

                  27. Tenant assumes full responsibility for protecting its
space from weather, theft, robbery and pilferage, which includes keeping doors
locked and other means of entry into the premises closed and secured.

                  28. Tenant shall not sell food of any kind or cook in the
Building. Tenant may serve complimentary foods to its guests provided that it
shall first comply with all Legal Requirements.

                  29. Water in the premises shall not be wasted by Tenant or its
employees by tying or wedging back the faucets of the washbowls or otherwise.

                  30. All messengers shall be required to sign in and obtain a
pass from either the front desk or the elevator starters. Contractors and other
workmen shall use only the freight elevators for all movement within the
Building.

                  31. Landlord reserves the right at any time, to install a
message/package center in an area in the Building designated by Landlord and
reasonably accessible to and for the common use of the tenants, and tenants
shall comply with the procedures for the same set forth by the Landlord.

                                       66
<PAGE>

                                   SCHEDULE D
                                   ----------

                             Cleaning Specifications

                                       for

                                805 Third Avenue



Landlord will perform cleaning services in the Demised Premises and related
areas as follows:


NIGHTLY
-------

                  Empty and wipe clean all ash trays.

                  Empty and wipe clean all waste receptacles.

                  Wipe clean all areas within hand high reach; including but not
                  limited to window sills, wall ledgers, chairs, desks, tables,
                  baseboards, file cabinets, convector enclosures, pictures and
                  all manner of office furniture.

                  Wipe clean all glass top desks and tables.

                  Sweep with treated cloths all composition tile flooring.

                  Carpet sweep all carpeted areas, and vacuum clean weekly.


PUBLIC LAVATORIES (Nightly or as otherwise designated)
-----------------

                  Wash and dry all bowls, seats urinals, washbasins and mirrors.

                  Wash and wipe dry all metal work.

                  Supply and insert toilet tissue, toweling and soap in
                  dispensers.

                  Empty paper towel and sanitary napkin disposal receptacles and
                  remove to designated area.

                  Sweep and wash floors.

                                       67
<PAGE>

                  Wipe clean all sills, partitions and ledges.
                  Wipe clean exterior of waste cans and dispensing units.

                  Wash both partitions monthly.

                  Wash tile walls monthly.

                  Wash and dry interior of waste cans and sanitary disposal
                  containers weekly. Machine scrub flooring monthly.

                  Dust exterior of light fixtures monthly.


FLOOR MAINTENANCE
-----------------

                  A.  Public Corridors in Multi-Tenanted Floors only.

                           Damp mop and buff all composition flooring monthly.

                  B.  High Dusting Public Areas.

                           High dust all walls, ledges, pictures, anemostats,
                           registers, grilles, etc., not reached in normal
                           nightly cleaning quarterly.


WINDOW CLEANING SERVICES
------------------------

                  Clean all exterior windows, inside and out periodically during
the year, as Landlord deems necessary.


RUBBISH REMOVAL SERVICES
------------------------

                  Remove all ordinary dry rubbish and paper only from the office
                  premises of the Demised Premises daily, Monday through Friday,
                  holidays excepted.

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<PAGE>

                                   SCHEDULE E
                                   ----------

                                   Definitions


                  (a) The term mortgage shall include an indenture of mortgage
                               --------
and deed of trust to a trustee to secure an issue of bonds, and the term
mortgagee shall include such a trustee.
---------
                  (b) The terms include, including and such as shall each be
                                -------  ---------     -------
construed as if followed by phrase "without being limited to".

                  (c) The term obligations of this lease, and words of like
                               -------------------------
import, shall mean the covenants to pay rent and additional rent under this
lease and all of the other covenants and conditions contained in this lease. Any
provision in this lease that one party or the other or both shall do or not do
or shall cause or permit or not cause or permit a particular act, condition, or
circumstance shall be deemed to mean that such party so covenants or both
parties so covenant, as the case may be.

                  (d) The term Tenant's obligations hereunder, and words of like
                               ------------------------------
import, and the term Landlord's obligations hereunder, and words of like import,
                     --------------------------------
shall mean the obligations of this lease which are to be performed or observed
by Tenant, or by Landlord, as the case may be. Reference to performance of
                                                            -----------
either party's obligations under this lease shall be construed as "performance
and observance".

                  (e) Reference to Tenant being or not being in default
                                                             ----------
hereunder, or words of like import, shall mean that Tenant is in default, after
---------
any applicable notice and cure period, in the performance of one or more of
Tenant's obligations hereunder, or that Tenant is not in default, after any
applicable notice and cure period, in the performance of any of Tenant's
obligations hereunder, or that a condition of the character described in Section
25.01 has occurred and continues or has not occurred or does not continue, as
the case may be.

                  (f) References to Landlord as having no liability to Tenant or
                                                       ----------------------
being without liability to Tenant, shall mean that Tenant is not entitled to
      ---------------------------
terminate this lease, or to claim actual or constructive eviction, partial or
total, or to receive any abatement or diminution of rent, or to be relieved in
any manner of any of its other obligations hereunder, or to be compensated for
loss or injury suffered or to enforce any other kind of liability whatsoever
against Landlord under or with respect to this lease or with respect to Tenant's
use or occupancy of the Demised Premises.

                  (g) The term laws and/or requirements of public authorities
                               ----------------------------------------------
and words of like import shall mean laws and ordinances of any or all of the
Federal, state, city, county

                                       69
<PAGE>

and borough governments and rules, regulations, orders and/or directives of any
or all departments, subdivisions, bureaus, agencies or offices thereof, or of
any other governmental, public or quasi-public authorities, having jurisdiction
in the premises, and/or the direction of any public officer pursuant to law.

                  (h) The term requirements of insurance bodies and words of
                               --------------------------------
like import shall mean rules, regulations, orders and other requirements of the
New York Board of Fire Underwriters and/or the New York Fire Insurance Rating
Organization and/or any other similar body performing the same or similar
functions and having jurisdiction or cognizance of the Building and/or the
Demised Premises.

                  (i) The term repair shall be deemed to include restoration and
                               ------
replacement as may be necessary to achieve and/or maintain good working order
and condition.

                  (j) Reference to termination of this lease includes expiration
                                   -------------------------
or earlier termination of the term of this lease or cancellation of this lease
pursuant to any of provisions of this lease or to law. Upon a termination of
this lease, the term and estate granted by this lease shall end at noon of the
date of termination as if such date were the date of expiration of the term of
this lease and neither party shall have any further obligation or liability to
the other after such termination (i) except as shall be expressly provided for
in this lease, or (ii) except for such obligation as by its nature or under the
circumstances can only be, or by the provisions of this lease, may be, performed
after such termination, and, in any event, unless expressly otherwise provided
in this lease, any liability for a payment which shall have accrued to or with
respect to any period ending at the time of termination shall survive the
termination of this lease.

                  (k) The term Tenant shall mean Tenant herein named or any
                               ------
assignee or other successor in interest (immediate or remote) of Tenant herein
named, while such Tenant or such assignee or other successor in interest, as the
case may be, is in possession of the Demised Premises as owner of the Tenant's
estate and interest granted by this lease.

                  (l) Words and phrases used in the singular shall be deemed to
include the plural and vice versa, and nouns and pronouns used in any particular
gender shall be deemed to include any other gender.

                  (m) The rule of ejusdem generis shall not be applicable to
                                  ---------------
limit a general statement following or referable to an enumeration of specific
matters to matters similar to the matters specifically mentioned.

                                       70