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                                                                    EXHIBIT 10.2

                            MASTER SERVICES AGREEMENT

     This Master Services Agreement (the "AGREEMENT") dated as of FEBRUARY 1,
2002, by and between NEWROADS, Inc. ("NEWROADS"), a Delaware corporation with a
principal place of business at 75 Holly Hill Lane, Greenwich, CT 06830 and
ALLOY, INC. ("COMPANY"), a Delaware corporation with a principal place of
business at 151 West 26th Street, New York, NY 10001.

RECITALS

A.   COMPANY has a variety of marketing programs for the sale and/or
     distribution of various merchandise (the "MERCHANDISE"); and a variety of
     promotional campaigns (the "CAMPAIGNS") to enhance such marketing programs;
     and

B.   NEWROADS is a provider of various services to the direct response industry
     ("SERVICES"), including, but not limited to, order entry; data processing;
     rebate processing; sweepstakes processing; inbound telemarketing; customer
     service; pick, pack and ship; order fulfillment; warehousing and storage;
     and returns processing; and NEWROADS desires to provide some or all of
     these Services to COMPANY as more particularly described herein; and

C.   COMPANY desires that NEWROADS provide Services in connection with the sale
     of certain Merchandise (the "PROGRAM") or processing for certain Promotion
     Campaigns (the "CAMPAIGN") and NEWROADS desires to provide such services to
     COMPANY.

     NOW, THEREFORE, in consideration of the mutual promises and conditions
contained herein, and other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto hereby agree as
follows:

1.   APPOINTMENT. COMPANY hereby appoints NEWROADS as its preferred third party
     provider of Services upon the terms and conditions set forth in this
     Agreement.

2.   SERVICES. COMPANY hereby engages NewRoads to provide such Services as are
     described in the attached STATEMENTS OF WORK (each a "STATEMENT OF WORK"),
     and COMPANY shall pay for such Services as set forth in such STATEMENTS OF
     WORK.

     a.   If there is any difference between the terms and conditions of any
          Statement of Work attached hereto and any other portion of this
          Agreement, the terms of the Statement of Work including any exhibits
          thereto shall control.

     b.   CHANGE ORDERS; ADMINISTRATION. Any modifications to the specifications
          in a Statement of Work shall require execution of a written change
          order agreed to and executed by both parties to this Agreement.

3.   SERVICE LEVELS. Certain of the Services set forth in the Statements of Work
     are subject to the service levels set forth in the applicable Statement of
     Work (the "SERVICE LEVELS"). Such Service Levels define certain standards
     of performance, which NEWROADS shall maintain in the rendering of the
     Services so long as COMPANY is not in Default (as defined in the Section of
     this Agreement entitled, Other Defaults) hereunder. However, in
     circumstances in which this Agreement does not stipulate a certain Service
     Level to determine the standard of performance NEWROADS shall maintain with
     respect to any particular Service, NEWROADS, and COMPANY shall jointly
     agree upon the scope of NEWROADS' obligations regarding such Service, and,
     in any event, NEWROADS shall use commercially reasonable efforts to provide
     service levels not less than the industry norm for such Services.

     a.   The parties hereto agree and understand that for a period of 60 days
          from the Commencement Date (as defined in applicable Statement of
          Work) ("the Grace Period"), NEWROADS shall use commercially reasonable
          efforts to maintain the Service Levels but may fail to meet some or
          all of them due to usual and customary events involved in connection
          with Company'S transition into the Facility and onto the System and,
          as such, the parties hereto will not, during the Grace Period, deem
          such failure (s) to constitute a material breach for purposes of the
          Section of this Agreement entitled Other Defaults, so long as NEWROADS
          uses commercially reasonable efforts to maintain the applicable
          Service Levels.

4.   PLACE OF PERFORMANCE. Services shall be performed at facilities maintained
     by NEWROADS from time to time and specified in a Statement of Work;
     provided, however, that NEWROADS shall not be precluded from out-sourcing
     certain Services, if necessary and with the prior written consent of
     COMPANY, which shall not be unreasonably withheld on a temporary basis to
     providers which NEWROADS, in its sole judgments, determines to be
     reasonably acceptable, so long as NEWROADS remains primarily responsible
     for the providing of such out-sourced Services at reasonable Service
     Levels. NEWROADS may change the place of performance only with the prior
     written consent of the COMPANY.


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5.   FEES AND CHARGES. In consideration for performance of the Services during
     the Term (as defined hereinafter), COMPANY shall pay to NEWROADS the fees
     and charges delineated in the applicable STATEMENT OF WORK. These fees and
     charges shall include:

     a.   INITIAL START-UP FEE. COMPANY shall pay NEWROADS an initial start-up
          fee (the "INITIAL START-UP FEE") as consideration for the start-up
          services agreed upon by the parties hereto as set forth in the
          Statement of Work (the "START-UP SERVICES").

     b.   TRANSACTION FEES.

          i.   COMPANY shall pay to NEWROADS transaction fees ("TRANSACTION
               FEES") as set forth in the Statement of Work; as such rates may
               be adjusted from time to time by the C.P.I. Adjustment described
               below (the "TRANSACTION RATES"). These fees may include any or
               all of the following:

               1.   FIXED PER ORDER FEE. The Fixed Fee Per Order shall be
                    payable on such number of orders equal to the gross number
                    of orders processed into the System as indicated on System
                    Report SLS929 (or such other report containing similar
                    information), such orders being hereinafter referred to as
                    "Gross Orders"). Merchandise Exchange Orders shall not be
                    included in the calculation of Gross Orders to the extent
                    that they number fewer than three percent (3%) of Gross
                    Orders. Similarly, items released from backorder status
                    shall not be counted as orders for purposes of calculating
                    Gross Orders. Orders that have been cancelled for any
                    reason, in time to prevent such order from reaching the
                    warehouse floor, shall not be included in the count of Gross
                    Orders. The resulting product of the Fixed Fee Per Order
                    multiplied by the Gross Orders shall be hereinafter referred
                    to as the "Total Fixed Charge." In the event the Company
                    institutes a continuity program whereby goods are sent to
                    customers on a regular basis pursuant to a single order
                    processed into the System, the Fixed Fee Per Order for any
                    such order shall be agreed between the parties.

                    a.   VOLUME DISCOUNTS. Based upon the aggregated Gross
                         Orders for all Statements of Work executed in
                         conjunction with this Master Services Agreement,
                         COMPANY shall be entitled to a discount of the
                         applicable Fixed Fees for any such Statement of Work,
                         on any subsequent order, according to the following
                         schedule. The Aggregated Gross Orders shall include the
                         total of the Gross Orders billed under any applicable
                         Statement of Work in the most recent 12 months for
                         which billing has been completed.

                         i.   If the Aggregated Gross Orders exceeds 2,000,000
                              orders, COMPANY shall be entitled to a five
                              percent discount.

                         ii.  If the Aggregated Gross Orders exceeds 2,500,000
                              orders, COMPANY shall be entitled to a ten percent
                              discount.

                         iii. If the Aggregated Gross Orders exceeds 3,000,000
                              orders, COMPANY shall be entitled to a 15 percent
                              discount.

                         iv.  From January 1, 2003 to March 31, 2003; or at such
                              time as a Statement of Work under this Master
                              Services Agreement is executed on behalf of the
                              "Alloy Business", NewRoads agrees that, for the
                              purpose of calculating Aggregated Gross Orders,
                              NewRoads will include the most recent 12 months of
                              "Alloy" activity in such calculation.

                         v.   Beginning February 1, 2006, the fifth year of this
                              Agreement, if Company passes for the first time
                              one of the discount thresholds defined in
                              sub-paragraphs i, ii, or iii in this section of
                              the Agreement, Company shall have the option, one
                              time, of applying the corresponding discount to
                              all orders received in the six months immediately
                              prior and including the month during which the
                              threshold was surpassed. This Option shall expire
                              60 days from the first day of the month following
                              the month during which the threshold was
                              surpassed.

               2.   STORAGE FEE. A monthly fee applied to the space utilized for
                    storage of Merchandise in a NewRoads warehouse. This fee may
                    be calculated based upon cubic feet utilized and/or pallets
                    utilized, varying by the nature of the Merchandise and
                    purpose of the storage. The applicable Storage Fee and the
                    Method of Calculation shall be specified in the Statement of
                    Work.


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               3.   ADJUSTED ACTUAL VARIABLE COST.

                    a.   "Adjusted Actual Variable Costs" are a percentage, as
                         specified in the applicable Statement of Work, of those
                         costs, charges or expenses, not included in Fixed
                         Costs, which are incurred and paid by NEWROADS in
                         connection with its performance of the Services, and
                         may include:

                         i.    all direct and indirect labor costs (including
                               employee and Social Security taxes, benefits and
                               fringe benefits) for employees engaged in the
                               performance of Services whose salaries and
                               benefits are not included in the calculation of
                               the Total Fixed Charge,

                         ii.   supervisory personnel costs up to an amount that
                               does not exceed 8% of the costs referred to in
                               item (i) above (the "Supervisory Allocation"),

                         iii.  inbound and outbound telephone call charges,

                         iv.   packaging, and packaging supplies, office and
                               data processing supplies,

                         v.    postage,

                         vi.   common carrier, delivery, courier and other
                               charges for receiving and shipping Merchandise,

                         vii.  costs in connection with outsourced services
                               referred to in Section 4 hereof, entitled "Place
                               of Performance."

                         viii. recurring costs incurred in connection with the
                               provision of an alternate redundant telephone
                               service into the Facility, installed or
                               maintained for back-up or disaster recovery
                               purposes,

                         ix.   costs incurred to train employees and associates,
                               both prior to and after the Commencement Date, to
                               handle the Company's business pursuant to the
                               terms of this Agreement,

                         x.    non-management labor costs incurred to perform
                               the Set-Up Tasks, such as in receiving and
                               unpacking Merchandise into the Facility, and

                         xi.   all other items consumed in the rendering of
                               Services hereunder.

                    b.   For purposes of billing the Company for Services,
                         Adjusted Actual Variable Costs shall not include any
                         amounts paid directly by the Company or through its
                         Disbursement Account, as defined below. The level or
                         amount of expenses to be incurred by NEWROADS, which
                         comprise Adjusted Actual Variable Costs includes costs,
                         charges, and expenses incurred as a result of NEWROADS'
                         errors in its provision of Services, so long as such
                         errors are not directly caused by NEWROADS' gross
                         negligence. In the event of material, non-negligent
                         errors caused by NEWROADS, the parties agree to
                         negotiate in good faith to arrive at equitable
                         financial resolution for such errors.

                    c.   To the extent that the Adjusted Actual Variable Costs
                         incurred by NEWROADS in the provision of Services for
                         the Company pursuant to this Agreement are not
                         identifiable as the sole and unique responsibility of
                         the Company (for example, where the cost of labor has
                         to be allocated between the Company and other companies
                         in the facility for which NEWROADS provides services)
                         then, in calculating Adjusted Actual Variable Costs,
                         NEWROADS shall utilize the allocation systems and
                         procedures maintained from time to time by NewRoads
                         (the "Allocation System"), it being the parties'
                         intention that the Allocation System reflects, and
                         allocates as fairly and accurately as possible, the
                         Adjusted Actual Variable Costs payable by the Company
                         in respect of the Services performed by or on behalf of
                         NEWROADS. The calculation by NEWROADS of Adjusted
                         Actual Variable Costs shall be available for review by
                         the Company upon request therefore and with reasonable
                         notice. The Allocation System shall not be construed or
                         manipulated to work more in the favor of either of the
                         parties hereto and against or in favor of the interests
                         of any other company for whom NEWROADS is providing
                         services.

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          ii.  The Transaction Rates shall be subject to adjustment as follows:

               1.   The Fixed Fee Rates set forth in the Statement of Work shall
                    be adjusted annually, on January 1 of each year thereafter
                    during the Term, by an amount equal to 50 percent of the
                    percentage increase in the Urban Wage Earners and Clerical
                    Workers-All Items-South consumer price index published by
                    the U.S. Department of Labor for the most recent 12 month
                    period for which statistics are available on such dates
                    determined by comparing such index to the index quoted for
                    the immediately prior twelve month period (the "C.P.I.
                    ADJUSTMENT"). The index use for this adjustment shall be the
                    regional index, which includes the primary place of
                    performance, as specified in the appropriate Statement of
                    Work. Specifically, the index to be used is CPI-W,
                    historically published in Table 6 of the U.S. Department of
                    Labor's report on the Consumer Price Index.

          iii. MINIMUM MONTHLY CHARGE - COMPANY agrees to pay a minimum monthly
               charge to NEWROADS when the total of all transaction fees in a
               particular calendar month fall below the amount of the minimum
               charge. The amount of this minimum charge shall be specified in
               the Statements of Work.

     c.   SPECIAL SERVICES. If Company requests that NEWROADS provide services
          not already defined in the Statements of Work, COMPANY shall pay
          NEWROADS at the hourly rates specified in the applicable Statement of
          Work, or a fixed amount mutually agreed to in writing by the parties.
          All such requests for services (Special Services) not defined the
          Statements of Work shall be in writing and agreed to by both parties.

     d.   CLOSE DOWN EXPENSES. Upon expiration or any termination of this
          Agreement for any reason, Company shall pay close-down charges
          relating to all close-down activities and for all purging of the
          NEWROADS computer system and for such other activities as shall be
          agreed upon between NEWROADS and Company based on the prevailing
          hourly rates in place at the time of such close down activity,
          including but not limited to such activities as removal of Merchandise
          from racks, packing for shipment (if necessary), preparing freight
          documents for shipment to COMPANY'S designated destination and loading
          on the trucks of COMPANY'S designated carrier, together with the cost
          of any necessary supplies.

     e.   TERMINATION FEE. If COMPANY terminates this Agreement prior to the
          expiration of the term, for reasons other than a material breach by
          NEWROADS or force majeure, a termination fee shall be due. This
          TERMINATION FEE, as specified in an applicable Statement of Work,
          shall be prorated from the date of termination to the end of the Term.
          At the end of the initial 36 months, the remaining prorated amount of
          the Termination Fee shall be reduced by 50 percent.

     f.   PRODUCTIVITY SAVINGS. The parties agree to cooperate and collaborate
          to identify new processes or changes to existing processes, which will
          result in reductions to the Adjusted Actual Variable Cost. The parties
          acknowledge such opportunities may require consideration of capital
          expenditures or adjustments to existing fee schedules. The parties
          agree to address each opportunity as they are identified.

6.   PAYMENTS.

     a.   INITIAL START-UP FEE. The initial start-up fee shall be paid
          concurrently with the execution of the initial STATEMENT OF WORK by
          Company.

     b.   TRANSACTION FEES. NEWROADS shall, on a weekly basis, issue to COMPANY
          an invoice for the Transaction Fees. Each invoice shall be due and
          payable within 15 days after the date that the invoice is received by
          COMPANY.

          i.   The Company shall also pay to NEWROADS the Total Variable Charge
               in accordance with the terms of this Agreement. The "Total
               Variable Charge" is calculated by multiplying (x) the Estimated
               Variable Cost Per Order (as defined below) in respect of any Week
               during the Term hereof, by (v) the total number of Gross Orders
               for such Week.

          ii.  The "Estimated Variable Cost Per Order" for each Week during the
               Term hereof shall be such amount as equals (x) the Adjusted
               Actual Variable Costs (as defined below) of the preceding Month
               divided by (y) the total number of Gross Orders for such
               preceding Month. The parties agree that the Estimated Variable
               Cost for the first Month only of this Agreement shall be
               specified in the applicable Statement of Work. For purposes of
               calculation of Adjusted Actual Variable Costs pursuant to this
               Section, any amounts paid from the Disbursement Account (as
               defined in this Agreement) shall be excluded.

          iii. Within twenty (20) Business Days following the end of each Month
               during the Term hereof, NEWROADS shall

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               reconcile Adjusted Actual Variable Costs against the Total
               Variable Charge for such Month, and:

               1.   In the event that Adjusted Actual Variable Costs are higher
                    than the Total Variable Charge, then, the Company shall pay
                    the difference between Adjusted Actual Variable Costs and
                    the Total Variable Charge to NEWROADS within fifteen (15)
                    Business Days of a demand therefore; or

               2.   If the Total Variable Charge is higher than Adjusted Actual
                    Variable Costs, then NEWROADS shall credit the difference
                    between the Total Variable Charge and Adjusted Actual
                    Variable Costs against amounts owed by the Company to
                    NEWROADS, except with respect to any credit arising out of
                    the final Monthly reconciliation which shall be paid in cash
                    unless the Company owes other amounts to NEWROADS at such
                    time, in which case such amount shall be credited against
                    the amount owed.

          iv.  NEWROADS shall, on a Weekly basis, issue to the Company an
               invoice in the amount equal to the Total Fixed Charge plus the
               Total Variable Charge for such Week. Such invoice shall be due
               and payable within 15 days of the date of faxed receipt of such
               invoice and will be subject to any credit balance in favor of the
               Company as a result of this Section.

     c.   SPECIAL SERVICES FEES. Special Services charges, for work not included
          in a Statement of Work and mutually agreed to by the parties, both in
          terms of scope and associated fees, shall be invoiced not more than
          weekly nor less than monthly. Such invoices shall be due and payable
          within 15 days of the date that the invoice is received by COMPANY.

     d.   CLOSE DOWN EXPENSES. Upon the expiration or any termination of this
          Agreement, NEWROADS will issue to COMPANY an invoice for the
          reasonably estimated Close Down Expenses (except for that portion of
          the Close Down Expenses relating to telecommunication charges and
          costs addressed hereinbelow), and such invoice shall be due and
          payable no later than 15 days after the date of such invoice. Promptly
          after completion of the close-down activities, NEWROADS shall submit a
          final adjusted bill to COMPANY reflecting charges pursuant to the
          Section of this Agreement entitled Fees and Charges, Close Down
          Expenses and an appropriate credit or charge with respect to any
          difference from the previously invoiced amount, and NEWROADS or
          COMPANY, as applicable, shall pay within 15 Business Days any
          resulting amount owing to the other that is not otherwise credited.
          The portion of the Close Down Expenses relating to the transfer of
          portable 800 numbers and estimated cost for calls not billed will be
          reconciled and billed monthly until all such telephone activity has
          been billed and paid.

     e.   TERMINATION FEE. If applicable, the Termination Fee shall be due
          within 15 days after notification of termination by COMPANY to
          NEWROADS.

7.   DISBURSEMENT ACCOUNT. At all times during the term of this Agreement,
     COMPANY shall maintain with NEWROADS a Disbursement Account (the
     "DISBURSEMENT ACCOUNT") sufficient to cover certain reasonable expenses
     paid by NEWROADS on behalf of COMPANY, including all common carrier and
     other delivery service shipping costs, packing materials, stationery and
     other similar expenses, and NEWROADS shall pay such expenses therefrom so
     long as and to the extent that a balance remains therein. COMPANY and
     NEWROADS shall agree in advance upon which costs and charges are to be paid
     from the Disbursement Account, it being understood that such list of
     charges may change from time to time according to COMPANY'S business needs
     and NEWROADS' operations. The Disbursement Account shall (at a minimum) be
     funded by COMPANY from time to time as needed to bring the balance of the
     fund to an amount, which would cover forecasted expenses for the ensuing
     two week period after taking into consideration such factors as forecasted
     order volume, seasonality and other applicable factors. If the Disbursement
     Account is insufficient to cover such expenses, NEWROADS may, in its sole
     discretion: (a) upon request of COMPANY, pay the expenses and immediately
     invoice Company for the amount of expenses incurred plus a 15 percent
     mark-up, and such invoice amount shall be payable within five Business Days
     after receipt; or (b) following five Business Days after providing COMPANY
     with written notice of insufficient funds in the Disbursement Account (and
     the Disbursement Account has not during such time been restored in full),
     elect not to pay the expenses, and if NEWROADS so elects not to pay the
     expenses, it shall have no liability whatsoever for any losses or
     liabilities incurred by COMPANY for such nonpayment. NEWROADS shall provide
     COMPANY with a weekly statement setting forth the balance of, and
     accounting for disbursements from, the Disbursement Account.

8.   FORECASTS. The parties acknowledge that orders for Merchandise may not be
     uniform from month to month as a result of various factors, including the
     seasonal nature of the demand for Merchandise and advertising and marketing
     schedules which are subject to constant changes, and that the inability of
     COMPANY to accurately predict the volume of orders to be processed, receipt
     of phone calls, receipt of electronic mail messages or the inventory to be
     received and warehoused on a weekly basis may have a detrimental effect on
     NEWROADS' ability to provide the Services in accordance with the Service
     Levels. COMPANY recognizes and understands the importance of keeping
     NEWROADS informed at all times of forecasted order volumes, schedule
     changes, fast and slow selling items, Merchandise or vendor problems and
     all other material business issues which might have an effect upon the
     performance by NEWROADS of its obligations hereunder and shall

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     provide NEWROADS with reasonable notice after COMPANY is aware of any
     changes in any such forecasted items. Specifically, but without limiting
     the generality of the foregoing, Company agrees as follows:

     a.   COMPANY shall use commercially reasonable efforts to deliver to
          NEWROADS a complete set of projections at least two months prior to
          the beginning of each successive calendar year, during the Term
          hereof, in respect of such calendar year, covering the operation of
          its business for such calendar year, including, by month and quarter,
          the forecasted number of orders; forecasted number of emails and
          telephone calls; the forecasted number of units received and shipped;
          and the forecasted returns (each projections being hereinafter
          referred to as an "ANNUAL FORECASTS").

     b.   Four weeks prior to the first day of each calendar quarter, COMPANY
          shall use commercially reasonable efforts deliver to NEWROADS a
          complete set of projections covering the operation of its business and
          demand for merchandise for the next succeeding two calendar quarters,
          including, by week, the forecasted number of orders; forecasted number
          of emails and telephone calls; and the forecasted number of units
          received and shipped each week; and the forecasted returns (each
          quarterly projections being hereinafter referred to as a "QUARTERLY
          FORECAST").

     c.   COMPANY shall use commercially reasonable efforts to deliver to
          NEWROADS a revised Quarterly Forecast (a "REVISED QUARTERLY FORECAST")
          whenever it believes that any business condition of which it is aware
          may have the effect of changing any item of the previous Quarterly
          Forecast furnished to NEWROADS. In the event that COMPANY experiences
          an actual increase in any forecast part of its business in respect of
          any week of more than 15 percent over that projected for such activity
          for such week, as set forth in any applicable Quarterly Forecast (or a
          Revised Quarterly Forecast which has been delivered to NEWROADS at
          least four weeks prior to such week) and has not advised NEWROADS in
          writing at least four weeks prior to such week that such increase is
          forecasted, then NEWROADS shall use commercially reasonable efforts
          but be under no obligation to meet those Service Levels directly or
          indirectly impacted by the increased level of activity for so long as
          Company's volume exceeds by more than 15 percent the volume projected
          in the most recent Quarterly Forecast or Revised Quarterly Forecast
          for such activity

     d.   The information contained in Quarterly Forecasts, Revised Quarterly
          Forecasts and Annual Forecasts provided by COMPANY to NEWROADS shall
          be reasonably related to and consistent with the actual operating
          history of COMPANY, subject to deviations therefrom as reasonably
          required by changes in circumstances.

9.   INVENTORY. Merchandise inventory shall be handled and processed as follows:

     a.   COMPANY shall, at its own expense, supply NEWROADS at the NEWROADS
          facilities specified in the applicable Statement of Work, and maintain
          with NEWROADS an inventory of Merchandise, which COMPANY reasonably
          believes is adequate in the ordinary course of business to fill orders
          received for its Merchandise in line with its Quarterly Forecasts or
          Revised Quarterly Forecasts. NEWROADS shall use commercially
          reasonable efforts to preserve and maintain Merchandise received for
          COMPANY in good and marketable condition.

     b.   NEWROADS shall use its best commercial efforts but is under no
          obligation to receive Merchandise on behalf of COMPANY unless COMPANY
          has transmitted to NEWROADS, within two Business Days prior to the
          receipt of such Merchandise, a copy of the purchase order by which
          COMPANY ordered such Merchandise, or all requisite details of the
          purchase order to permit NEWROADS to identify the Merchandise as that
          of Company.

     c.   For inbound shipments, COMPANY shall advise its vendors that motor
          carriers must contact NEWROADS at least two Business Days prior to
          delivery and make a delivery appointment prior to arrival. Inbound
          shipments arriving at a NEWROADS warehouse without one Business Day's
          prior notice may be refused or delayed by NEWROADS depending on the
          space and manpower available at the time of arrival. Each inbound
          shipment must have a packing slip and each carton must be marked with
          the purchase order number and SKU number.

     d.   For purposes of this Agreement, "PROBLEM MERCHANDISE" means
          Merchandise shipped to NEWROADS, which in NEWROADS sole reasonable
          discretion cannot be processed by NEWROADS without imposing an
          unreasonable hardship on NEWROADS. For illustrative purposes and
          without limiting the definition thereof, Problem Merchandise shall
          include all Merchandise which (i) arrives with insufficient paperwork,
          (ii) is delivered to NEWROADS in the absence of a delivery appointment
          or (iii) is faulty or damaged. NEWROADS shall use its commercially
          reasonable efforts to comply with COMPANY'S written instructions
          regarding handling and disposing of Problem Merchandise and shall
          submit to COMPANY a report of Problem Merchandise as soon as
          practicable after having received it. NEWROADS shall not include
          Problem Merchandise in the inventory of items available for shipment
          to customers but in a separate inventory stored at storage rates as
          specified in the applicable Statement of Work for the first 30 days
          and thereafter at a storage rate of one and one-half times such
          applicable storage rates (the "PROBLEM MERCHANDISE RATE"). COMPANY
          acknowledges that Problem Merchandise cannot be stored indefinitely
          and that all Problem Merchandise shall be removed at COMPANY'S expense
          within 30 days after NEWROADS notifies COMPANY of specific details
          relevant to the reasons for the

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          classification of the Merchandise as Problem Merchandise. NEWROADS has
          the right to dispose of the Problem Merchandise by returning the
          Merchandise to COMPANY on a freight collect basis or taking any other
          actions which are reasonable under the circumstances; provided,
          however, that NEWROADS shall follow COMPANY'S reasonable directions
          with respect to any other disposition (at COMPANY'S expense) of the
          Problem Merchandise. Once Merchandise has been adequately repaired or
          reconstituted so that its processing no longer imposes an unreasonable
          hardship on NEWROADS, NEWROADS agrees to promptly remove such
          Merchandise from its Problem Merchandise status and to so notify
          COMPANY in writing within two Business Days.

     e.   NEWROADS acknowledges and COMPANY agrees that COMPANY shall be solely
          responsible for selecting, purchasing, paying for and arranging for
          the shipment to NEWROADS of Merchandise, and NEWROADS agrees that it
          shall not have and shall not represent that it has any authority to
          undertake any of such activities on COMPANY'S behalf.

     f.   In the event that any Merchandise shipped by NEWROADS to customers is
          damaged (or lost in shipment), NEWROADS agrees to notify COMPANY,
          store damaged and returned Merchandise at the Problem Merchandise Rate
          pending inspection by the carrier, file tracers for the lost shipments
          and claims for damaged and lost shipments which originated from
          NEWROADS, and reimburse COMPANY for any money paid or credited to
          NEWROADS by the common carrier as a result of such claims within
          thirty (30) days after receipt.

     g.   NEWROADS reserves the right to refuse, without liability of any kind,
          acceptance of Merchandise which, because of its condition, might
          cause, in NEWROADS' reasonable sole judgment, infestation,
          contamination, or damage to the warehouse facility or to other goods
          in the custody of NEWROADS. NEWROADS shall notify COMPANY of its
          refusal to accept any such Merchandise and the reason for its refusal
          within two Business Days after such refusal. If NEWROADS believes that
          any Merchandise has caused or may cause damage to the warehouse
          facility or to any other goods in the custody of NEWROADS or has
          characteristics which make its storage illegal, NEWROADS, after giving
          reasonable notice to COMPANY, may dispose of the Merchandise in any
          lawful manner and will incur no liability by reason of such disposal,
          and COMPANY shall pay NEWROADS any reasonable costs incurred by
          NewRoads in connection with such disposal as well as storage at the
          Problem Merchandise Rate from the date NEWROADS notifies COMPANY of
          such belief.

     h.   All Merchandise in the possession of NEWROADS shall be and remain the
          exclusive property of COMPANY, and NEWROADS acknowledges and agrees
          that it shall acquire no right, title or interest in or to any
          Merchandise by reason of this Agreement. NEWROADS shall not transfer,
          assign, exchange, lease, encumber, pledge, or create a security
          interest in or otherwise dispose of the Merchandise and shall not
          subject the Merchandise to attachment, levy, or seizure by or on
          behalf of any creditor of NEWROADS.

     i.   Company hereby grants to NEWROADS a security interest in the
          MERCHANDISE held from time to time by NEWROADS to secure the
          obligations of Company hereunder; provided, however, that NEWROADS
          agrees to release such security interest upon the reasonable request
          of Company in the event that Company provides NEWROADS security in
          substitution therefore which is acceptable to NEWROADS in NEWROADS'
          sole discretion. COMPANY shall execute all documents reasonably
          requested by NEWROADS for the perfection of any such security
          interest. COMPANY shall not grant any Lien to any third party, with
          the exception of general revolving credit arrangements maintained by
          COMPANY in the ordinary and usual course of business with its banks
          and purchase money liens, which shall have priority to the Lien of
          NEWROADS hereunder on any MERCHANDISE inventory without the prior
          written consent of NEWROADS, which agreement shall not be unreasonably
          withheld, provided that any such Lien shall only be in the form of a
          security interest to a financial institution securing a revolving
          working capital credit facility, and further provided that COMPANY is
          not delinquent in the payment of any amounts owing to NEWROADS under
          this Agreement and COMPANY has proved to NEWROADS with reasonable
          assurances that it will be ab1e to meet its future payment obligations
          to NEWROADS as and when they come due under this Agreement.

10.  RISK OF LOSS.

     a.   All risk of loss and damage to Merchandise from any cause prior to
          receipt by NEWROADS into, and from and after the removal by common
          carrier from, the inventory at the NEWROADS facility shall be borne by
          COMPANY. Any loss or damage by fire or casualty to Merchandise on the
          premises of NEWROADS shall be borne by COMPANY. NEWROADS shall
          reimburse COMPANY at COMPANY'S net Merchandise cost (i) 0 percent of
          all Inventory Shrinkage which is equal to or less than 1.0 percent,
          (ii) 100 percent of all Inventory Shrinkage which exceeds 1.0 percent.
          For purposes of this Agreement "INVENTORY SHRINKAGE" means the
          quotient which results from dividing (A) the cumulative Variance (as
          defined below) between the value of the Merchandise inventory as
          determined from the perpetual inventory report on the requisite Count
          Date (as defined below) and the value of the Merchandise inventory
          based upon a physical inventory or cycle count (exclusive of markdowns
          and price adjustments) on such Count Date by (B) the total Merchandise
          inventory receipts processed by NEWROADS during the prior 12 months.

                                       7
<PAGE>
     b.   All risk of loss and damage to COMPANY materials other than
          Merchandise, such as literature or package inserts, from any cause
          prior to receipt by NEWROADS into, and from and after the removal by
          common carrier from, the inventory at the NEWROADS facility shall be
          borne by COMPANY. Any loss or damage by fire or casualty to
          Non-Merchandise materials on the premises of NEWROADS shall be borne
          by COMPANY. NEWROADS shall reimburse COMPANY at Company's net cost (i)
          0 percent of all Inventory Shrinkage which is equal to or less than
          10.0 percent, (ii) 50 percent of all Inventory Shrinkage which exceeds
          10.0 percent but is equal to or less than 20.0 percent, and (iii) 100
          percent of all Inventory Shrinkage which exceeds 20.0 percent. For
          purposes of this Agreement "INVENTORY Shrinkage" means the quotient
          which results from dividing (A) the cumulative Variance (as defined
          below) between the value of the Non-Merchandise material inventory as
          determined from the perpetual inventory report on the requisite Count
          Date (as defined below) and the value of the Non-Merchandise material
          inventory based upon a physical inventory or cycle count (exclusive of
          markdowns and price adjustments) on such Count Date by (B) the total
          Non-Merchandise material inventory receipts processed by NEWROADS
          during the prior 12 months.

     c.   For purposes of this Section 11, "VARIANCE" shall mean the difference
          between the value of the Merchandise inventory as determined from the
          perpetual inventory report on any Count Date and the value of the
          Merchandise inventory established by a cycle count or physical
          inventory on such date (the "COUNT DATE"); provided, however, that for
          purposes of determining the Variance, Merchandise prices shall be
          deemed to be constant regardless of any intermittent price changes.
          The value of any adjustment made at any time to the perpetual
          inventory report shall be added to or subtracted from, as the case may
          be, the Variance for the purpose of calculating Inventory Shrinkage.
          Physical inventory and cycle counts may be requested in writing by
          COMPANY on a semiannual basis for Count Dates occurring within 180
          days prior to the date of such request. Such requests for physical
          inventory or cycle counts shall be deemed a request for Special
          Services and are billable activities under section 9 of this
          agreement.

11.  COLLECTIONS. Notwithstanding anything contained herein to the contrary, the
     parties acknowledge that NEWROADS shall not be required to make any
     collection efforts on COMPANY's behalf and shall share no risk with respect
     to any failure of COMPANY to collect payment for any customer order.

12.  TAXES. All fees, costs, charges and other amounts payable to NEWROADS
     hereunder for Services rendered by NEWROADS to Company are exclusive of
     applicable taxes, if any, which (other than income taxes of NEWROADS) are
     the responsibility of COMPANY. In addition, NEWROADS shall calculate for
     each customer sale all applicable sales taxes based on information supplied
     by COMPANY. NEWROADS shall collect such sales tax in accordance with
     instructions provided by the COMPANY. A list of all the jurisdictions in
     which COMPANY is required to collect sales taxes shall be included in the
     Statement of Work, which COMPANY shall promptly update as required to keep
     such information current during the Term of this Agreement, and COMPANY
     shall be solely responsible for the accuracy of such information. COMPANY
     shall be responsible for the collection and payment of all sales taxes, the
     preparation and filing of all sales tax documentation and the compliance
     with all sales tax laws. NEWROADS shall have no such responsibilities for
     payment or collection of any such taxes unless otherwise required by law.
     COMPANY shall indemnify NEWROADS for all claims, suits, actions, debts,
     damages, costs, charges and expenses, including court costs and reasonable
     attorneys' fees, incurred by NEWROADS due to COMPANY's failure to properly
     and timely file and pay applicable taxes.]

13.  MONETARY DEFAULT. If the COMPANY defaults on the payment of any fees,
     charges, invoices or other amounts due to NEWROADS pursuant to this
     Agreement (hereinafter a "Monetary Obligation"), and such Monetary
     Obligation is not subject to a Dispute Notice (defined below) NEWROADS
     shall (i) charge a finance charge of 1.5% per month of the amount of a
     Monetary Obligation and (ii) upon 20 Business Days prior written notice of
     such default stop providing Services and performing its obligations under
     this Agreement and/or terminate this Agreement. In the event that the
     COMPANY reasonably in good faith disputes the amount or payment of such
     Monetary Obligation (a "Monetary Dispute") and reports its reasons
     therefore to NEWROADS in writing (a "Dispute Notice"), NEWROADS agrees to
     work diligently and in good faith with the COMPANY to resolve the dispute
     for a period of up to ten Business Days from the date of the Dispute
     Notice, provided, however, that (i) during such period NEWROADS shall
     continue to perform Services, (ii) the COMPANY shall be current in and
     shall continue to make payments to NEWROADS relating to all Actual Variable
     Costs hereunder, other than such amount that is subject to the Dispute
     Notice and (iii) the COMPANY shall make all other payments required
     hereunder to NEWROADS (e.g. Fixed Fee Per Order and Special Services Costs)
     other than those payments subject to the Dispute Notice. In the event that
     NEWROADS and the COMPANY are unable to resolve the Monetary Dispute, then
     the amount in dispute shall be deposited into escrow with an escrow agent
     mutually acceptable to both NEWROADS and the COMPANY until such dispute is
     resolved in accordance with the Section of this Agreement entitled,
     Arbitration. In the event such dispute is resolved and to the extent the
     COMPANY owes any amount to NEWROADS, the COMPANY shall pay such amount to
     NEWROADS within ten Business Days of the resolution of such dispute. In the
     event such dispute is not resolved pursuant to the Section of this
     Agreement entitled, Arbitration, or the COMPANY has not deposited into
     escrow such amount in dispute, or the parties are unable to agree upon an
     acceptable escrow agent, NEWROADS shall have the right to stop providing
     Services and/or terminate this Agreement without further notice. The
     COMPANY shall not set-off any amount against invoices submitted by NEWROADS
     in respect of the Services performed hereunder against any claim, damage,
     action, cost or expense which may be asserted against NEWROADS at any time.

                                       8
<PAGE>
14.  OTHER DEFAULTS. If either COMPANY or NEWROADS believes the other party is
     in breach of any of its non-monetary obligations under this Agreement due
     to any reason other than force majeure, the party believing that such a
     breach by the other party has occurred shall, within 15 days of discovery
     of alleged breach, give written notice to the other party declaring a
     breach of this Agreement and specifying the nature of the breach (any such
     breach and any default in payment under MONETARY DEFAULT hereof are
     sometimes referred to herein as a "DEFAULT"). If the alleging party fails
     to give written notice of an alleged breach within 15 days, such alleging
     party shall lose any rights to terminate this agreement based upon the
     alleged breach. Such breaching party shall have 15 Business Days in which
     to cure such breach or, if such breach cannot be completely cured within 15
     Business Days, a reasonable time to cure such breach as long as the
     breaching party is diligently pursuing the cure of the breach; provided,
     however, that with respect to a material breach relating to the taking of
     telephone calls, emails, the processing of orders, the receiving of
     Merchandise into inventory or timely delivery of Merchandise to common
     carriers for shipment, NEWROADS shall have seven Business Days to cure such
     breach or, if such breach cannot be completely cured within five Business
     Days, a reasonable time to cure such breach so long as the NEWROADS is
     diligently pursuing the cure of the breach.

15.  FORCE MAJEURE. Neither NEWROADS nor COMPANY shall be liable for any delay
     or failure in performance under this Agreement or interruption of service
     resulting, directly or indirectly, from acts of God, civil or military
     authority, acts of public enemies, acts of terrorism, war, accidents, fire,
     explosions, earthquakes, floods, the elements or any similar cause beyond
     the reasonable control of such party (a "FORCE MAJEURE"), so long as,
     following the cessation of such cause, such party uses its reasonable
     efforts to resume its performance hereunder. If NEWROADS is unable to
     perform the Services due to a Force Majeure, then NEWROADS may out-source
     Services on a temporary basis pursuant to the Section of this Agreement
     entitled, Place of Performance. Force Majeure shall not be an excuse for
     COMPANY not meeting any financial obligation hereunder with respect to the
     timely payment for Services.

16.  TERM AND TERMINATION.

     a.   TERM. The initial term of this Agreement shall commence on FEBRUARY 1,
          2002 (the "COMMENCEMENT DATE"), continue for five years and shall
          expire on JANUARY 31, 2007 (the "EXPIRATION DATE") unless earlier
          terminated in accordance with this Section or elsewhere in this
          Agreement (the "INITIAL TERM"). This Agreement shall automatically be
          renewed for one two-year term commencing after the expiration of the
          Initial Term and, thereafter, for additional one year terms after the
          expiration of any renewal term unless NEWROADS or COMPANY provides the
          other with at least 90 days prior written notice of its election to
          terminate this Agreement at the end of the then current term (the
          Initial Term and all renewal terms are collectively referred to as the
          "TERM").

     b.   EARLY TERMINATION. This Agreement may be terminated prior to the
          Expiration Date upon the occurrence of any of the following, provided
          that any amounts owing to NEWROADS through the date of termination
          (including any Close-Down Expenses and Termination Fees, if
          applicable) shall be payable to NewRoads notwithstanding any such
          early termination:

          i.   MONETARY DEFAULT. NEWROADS shall have the termination rights
               described in the Section of this Agreement entitled Monetary
               Default.

          ii.  BANKRUPTCY. Either party may terminate this Agreement, effective
               immediately upon giving written notice if the other party files a
               petition in bankruptcy or files for a reorganization or for the
               appointment of a receiver or trustee of all or substantially all
               of such party's property, or makes an assignment or petitions for
               or enters into an arrangement for the benefit of creditors, or if
               a petition in bankruptcy is filed against the other party which
               is not discharged within 90 days thereafter.

          iii. FORCE MAJEURE. In the event that following a Force Majeure,
               NEWROADS (with out-sourcing) is unable to perform at the Service
               Levels for a period in excess of 20 Business Days, Company shall
               have the right to terminate this Agreement.

          iv.  A material default by NEWROADS pursuant to the Section of this
               Agreement entitled, OTHER DEFAULTS, which is not cured within the
               time periods stated therein shall entitle COMPANY to terminate
               the Agreement.

17.  REPRESENTATIONS AND WARRANTIES.

     a.   NEWROADS and COMPANY. NEWROADS and COMPANY each hereby individually
          represent and warrant that: (i) it has the full authority and legal
          right to carry out the terms of this Agreement; (ii) the terms of this
          Agreement will not violate the terms of any agreement, contract or
          other instrument to which it is a party, and no consent or
          authorization of any other

                                       9
<PAGE>
          person, firm or corporation is a condition precedent to this
          Agreement; (iii) it has taken all action necessary to authorize the
          execution and delivery of this Agreement; and (iv) this Agreement is a
          legal, valid, and binding obligation of NEWROADS and COMPANY, as the
          case may be, enforceable in accordance with its terms, except as
          limited by bankruptcy and other laws of general application relating
          to or affecting the enforcement of creditors' rights.

     b.   COMPANY. COMPANY hereby warrants and represents that except as
          otherwise set forth on SCHEDULE 1:

          i.   it has, to the best of its knowledge, and will use its
               commercially reasonable efforts to continue to have for the Term
               of this Agreement, all necessary authority from all of the
               corporations, partnerships and individuals whose products are
               offered for sale by Company, to use their trademarks, service
               marks and other intellectual property for the purposes of
               conducting COMPANY'S business. COMPANY'S business as conducted or
               as currently proposed to be conducted does not and will not cause
               Company to infringe or violate any patents, trademarks, service
               marks, trade names, copyrights, licenses, trade secrets or other
               intellectual property rights of any other person or entity.

          ii.  it owns the Merchandise inventory free and clear of all liens,
               restrictions, claims, charges, security interests or other
               encumbrances of any nature whatsoever, including any chattel
               mortgages, conditional sales contracts, collateral security
               arrangements and other title or interest retention arrangements
               (a "LIEN").

18.  INDEMNITY & LIABILITY.

     a.   NEWROADS agrees to indemnify, defend and hold COMPANY harmless from
          and against any and all claims, suits, actions, debts, damages,
          injuries, costs, charges, and expenses, (including without limitation
          court costs and reasonable attorneys' fees), which Company may at any
          time incur by reason of (i) a material breach of this Agreement by
          NEWROADS or (ii) NewRoads' gross negligence or an intentional or
          willful act of misconduct by NewRoads.

     b.   COMPANY agrees to indemnify, defend and hold NEWROADS harmless from
          and against any and all claims (including claims by third party
          providers engaged by COMPANY), suits, actions, debts, damages,
          injuries, costs, charges, and expenses, including without limitation
          court costs and reasonable attorneys fees, which NEWROADS may at any
          time incur arising from (i) use or consumption of the Merchandise,
          including without limitation use or consumption of Merchandise that
          contains or is claimed to contain a defect, or (ii) a material breach
          of this Agreement by COMPANY.

     c.   The indemnification provisions of this Section apply only to claims
          made against either party hereto by any third party and not to any
          claims made by either party hereto against the other. A party hereto
          seeking indemnity hereunder is referred to as the "Indemnified Party"
          and the other party to which indemnity is sought hereunder is referred
          to herein as the "Indemnifying Party". An Indemnified Party under this
          Agreement shall with respect to Claims asserted against such party by
          any third party, give written notice to the Indemnifying Party of any
          liability which might give rise to a claim for indemnity under this
          Agreement within 60 Business Days, of the receipt of any written claim
          from any such third party, but not later than 20 days prior to the
          date any answer or responsive pleading is due or five Business Days
          after notice of the action, whichever is later, and with respect to
          other matters for which the Indemnified Party may seek
          indemnification, give prompt written notice to the Indemnifying Party
          of any liability which might give rise to a claim for indemnity;
          provided, however, that any failure to give such notice will not waive
          any rights of the Indemnified Party except to the extent the rights of
          the Indemnifying Party are materially prejudiced. The Indemnifying
          Party shall have the right, at its election, to take over the defense
          or settlement of such claim by giving written notice to the
          Indemnified Party at least 15 days prior to the time when an answer or
          other responsive pleading or notice with respect thereto is required
          or 10 days after notice, whichever is later. If the Indemnifying Party
          makes such election, it may conduct the defense of such claim through
          counsel of its choosing (subject to the Indemnified Party's approval
          of such counsel, which approval shall not be unreasonably withheld)
          and shall be solely responsible for the expenses of such defense and
          shall be bound by the results of its defense or settlement of the
          claim. The Indemnifying Party shall not settle any such claim without
          prior notice to and consultation with the Indemnified Party, no such
          settlement involving any equitable relief or which might have an
          adverse effect on the Indemnified Party may be agreed to without the
          written consent of the Indemnified Party which consent shall not be
          unreasonably withheld. So long as the Indemnifying Party is diligently
          contesting any such claim in good faith, the Indemnified Party may pay
          or settle such claim only at its own expense and the Indemnifying
          Party will not be responsible for the fees of separate legal counsel
          to the Indemnified Party, unless the named parties to any proceeding
          include both parties and representation of both parties by the same
          counsel would be inappropriate. If the Indemnifying Party does not
          make such election, or having made such election does not, in the
          reasonable opinion of the Indemnified Party proceed diligently to
          defend such claim, then the Indemnified Party may (after written
          notice to the Indemnifying Party), at the expense of the Indemnifying
          Party, take over the defense of and proceed to handle such claim in
          its discretion and the Indemnifying Party shall be bound by any
          defense or settlement that the Indemnified Party may make in good
          faith with respect to such claim. The parties agree to cooperate in
          defending such third party claims and the Indemnified Party shall
          provide such cooperation and such access to its books,

                                       10
<PAGE>
          records and properties as the Indemnifying Party shall reasonably
          request with respect to any matter for which indemnification is sought
          hereunder; and the parties hereto agree to cooperate with each other
          in order to ensure the proper and adequate defense thereof with regard
          to claims of third parties for which indemnification is payable
          hereunder, such indemnification shall be paid by the Indemnifying
          Party upon the earlier to occur of: (i) the entry of a judgment
          against the Indemnified Party and the expiration of any applicable
          appeal period, or if earlier, five Business Days prior to the date
          that the judgment creditor has the right to execute the judgment; (ii)
          the entry of a non-appealable judgment or final appellate decision
          against the Indemnified Party; or (iii) a settlement of the claim,
          provided that if a judgment or settlement provides that payments may
          be made in installments, that the indemnification payments required
          -to be made hereunder in connection therewith shall be payab1e in a
          like manner. Notwithstanding the foregoing, providing that there is no
          dispute as to the applicability of indemnification, the reasonable
          expenses of counsel to the Indemnified Party shall be reimbursed on a
          current basis by the Indemnifying Party if such expenses are a
          liability of The Indemnifying Party. With regard to other claims for
          which indemnification is payable hereunder, such indemnification shall
          be paid promptly by the Indemnifying Party upon demand by the
          Indemnified Party.

     d.   Notwithstanding any other provision of this Agreement, neither party
          shall be liable to the other for any other special, incidental,
          punitive or consequential damages of any nature whatsoever, even if
          that party has been previously notified of the possibility of such
          damages. Any successful claim for actual damages against either Party
          shall be limited to the amounts billed under this agreement.

     e.   LIMITATION OF LIABILITY Neither party shall be liable to the other for
          any other special, incidental, punitive or consequential damages of
          any nature whatsoever even if that party has been previously notified
          of the possibility of such damages. NewRoads shall have no liability
          to the Company for the results of any acts of terrorism, including
          without limitation the insertion by third parties of hazardous
          substances in any packages handled by NewRoads, or any consumer
          response to such act of terrorism, provided NewRoads had no advance
          knowledge or through the exercise of reasonable diligence could have
          had no advance knowledge of such acts of terrorism.

19.  INSURANCE.

     a.   COMPANY agrees to maintain insurance, at its sole cost and expense,
          against loss or damage by fire or other casualty to COMPANY'S
          Merchandise on the premises of NEWROADS, and against any claims and
          liability growing out of either product liability, advertising
          liability or trademark or service mark, patent or copyright
          infringement, and to list NEWROADS as an additional insured
          thereunder. Such insurance will be maintained with insurers qualified
          to do business in the state where the inventory is warehoused.
          Attached hereto, as EXHIBIT A, is a Certificate of Insurance for
          COMPANY reflecting such coverage.

     b.   NEWROADS shall not be responsible for the provision or maintenance of
          any insurance coverage for the Merchandise or other inventory or for
          Company or its subsidiaries or respective businesses, products, goods
          and property. NEWROADS agrees to maintain at all times during the Term
          insurance with the coverages and at the levels set forth in the
          Certificate of Insurance for NEWROADS attached as EXHIBIT B; with
          insurers qualified to do business in the state of where the Services
          are performed.

20.  COMPLIANCE WITH LAWS. COMPANY and NEWROADS shall comply with all laws,
     rules and regulations, whether local, state, or federal, applicable to the
     sale of Merchandise and to the providing of Services.

21.  INSPECTIONS AND AUDITS. COMPANY or its agents shall, during normal business
     hours and upon one Business Days notice, have the right to inspect the
     Merchandise located at NEWROADS' place of business. COMPANY shall, during
     normal business hours and upon three Business Days notice, have the right
     to audit the books and records of NEWROADS pertaining to Merchandise and
     the Services rendered by NEWROADS to COMPANY and the fees charged in
     connection therewith pursuant to this Agreement; provided, however, that
     such audit of books and records shall occur no more frequently than in
     three month intervals and then shall cover only the three month period
     ending on the date such inspection commences. At least once each calendar
     year, the Chief Financial Officer of NEWROADS shall meet with the Chief
     Financial Officer of COMPANY and review the audited financial statements of
     NEWROADS.

22.  CONFIDENTIALITY; NON-SOLICITATION.

     a.   In the course of its performance of this Agreement, it is anticipated
          that NEWROADS and COMPANY will come into possession of certain
          proprietary information belonging to the other, including but not
          limited to

          i.   in the case of COMPANY, marketing records, merchandising records,
               customer records and customer files and

          ii.  in the case of NEWROADS, its financial condition, cost
               structures, staffing levels, systems information,

                                       11
<PAGE>
               monitoring records, customer records, customer files, trade
               secrets, sales forecasts, general business plans and other
               confidential or proprietary information (all such information
               relating to COMPANY or NEWROADS being "CONFIDENTIAL INFORMATION"
               and the party to whom such Confidential Information relates being
               the "PROPRIETARY PARTY").

     b.   NEWROADS and COMPANY agree that each will not, during the Term hereof
          or thereafter, furnish, disclose, or make accessible to any third
          party any of the other's Confidential Information unless otherwise
          instructed by the Proprietary Party in writing; provided, however,
          that Confidential Information shall not include any information which

          i.   at the time of disclosure by the other party is generally
               available to and known by the public other than as a result of
               its disclosure by such party,

          ii.  was available to the other party on a non-confidential basis from
               a source other than the Proprietary Party, provided that such
               source is not bound by a confidentiality agreement, or
               contractual or fiduciary obligation with the Proprietary Party,
               or

          iii. has been independently acquired or developed by the other party
               without violating any obligations under this Agreement, or of any
               other agreement between Company and NEWROADS.

     c.   NEWROADS agrees that COMPANY'S customer files will not be made
          available for use by anyone other than COMPANY, without COMPANY'S
          specific prior written permission for each occurrence of such use.

     d.   COMPANY agrees that it will not at any time during the Term or within
          three years after the termination or expiration of this Agreement,
          solicit, interfere with, employ or endeavor to entice away from
          NEWROADS (or any subsidiary or affiliate of NEWROADS) any employee,
          consultant, agent or other client of NEWROADS. The parties agree that
          placing advertisements soliciting employees of the type then employed
          by the Company or NewRoads, as the case may be, in newspapers,
          Internet job sites and similar media generally accessible to the
          public shall not be deemed to be a breach of this Section.

23.  NOTICES. Any and all notices and all communication provided for in this
     Agreement shall be given in writing. Such notices and other communications
     shall be deemed given when received, when delivered by hand, by confirmed
     facsimile transmission or when deposited in the United States Mail,
     Registered or certified, with proper postage prepaid, and addressed as
     follows, or to such other address as NEWROADS or COMPANY may designate to
     the other in writing.

     a.   If to NEWROADS: NewRoads, Inc., 730 East Church Street, Martinsville,
          VA 24112, Attn: President, Fax 276-656-2218, Phone 276-670-2000.

          i.   With copies to:

               1.   NewRoads, Inc.75 Holly Hill Lane, Greenwich, Connecticut
                    06830; Attn: James S. Hersh; Fax: 203.625.4767; Phone:
                    203.625.9899

               2.   Kane Kessler, PC; 1350 Avenue of the Americas; New York, NY
                    10019-4896; Attn: Robert L. Lawrence, Esq.; Fax:
                    212-245-3009; Phone: 212-519-5146.

     b.   If to COMPANY: Alloy, Inc., 151 West 26th Street, 11th Floor, New
          York, NY 10001, Attn: Samuel A. Gradess, fax: 212-244-4311.

          i.   With a copy to:

               1.   Alloy, Inc., 151 West 26th Street, 11th Floor, New York, NY
                    10001, Attn. General Counsel, Fax: 212-244-4311.

24.  ASSIGNMENT. This Agreement shall inure to the benefit of and be binding
     upon the parties and their successors and permitted assigns. This Agreement
     may not be assigned by either party without the prior written consent of
     the other party which shall not be unreasonably withheld; provided,
     however, that, it may be assigned to any person, firm or corporation which
     purchases all or substantially all of the stock or assets of either party
     or to any person, firm or corporation into which or with which either party
     consolidates or merges and provided further that either party may assign
     this agreement to any of its affiliates, subsidiaries, or its parent
     company.

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<PAGE>
25.  AMENDMENTS. This Agreement shall not be modified or amended except by a
     written agreement signed by authorized representatives of NEWROADS and
     Company.

26.  GOVERNING LAW. This Agreement has been entered into and shall be governed,
     construed, and interpreted in accordance with the laws of the State of New
     York without reference to any conflicts of law principles.

27.  ARBITRATION. Any dispute between the parties concerning this Agreement
     shall be submitted to binding arbitration before a single arbitrator in
     accordance with the following provisions:

     a.   If a dispute arises concerning this Agreement, the dispute shall be
          resolved through binding and non-appealable arbitration pursuant to
          the Commercial Arbitration Rules of the American Arbitration
          Association (the "RULES"), except where the Rules conflict with the
          provisions of this Section of this Agreement, in which event the
          provisions of this Section of this Agreement shall prevail. The
          arbitration shall be before one arbitrator selected by the parties, or
          if the parties cannot agree upon a single arbitrator within 30 days
          after a party giving notice to the other of a proposed choice for an
          arbitrator, then by a single arbitrator selected by the New York City
          office of the American Arbitration Association, who shall be a person
          (i) who is admitted to practice law in the State of New York and (ii)
          who is a partner in a law firm having at least 50 attorneys. Any
          arbitrator so appointed shall be neutral and subject to
          disqualification for the reasons specified in Section 19 of the Rules.

     b.   Each party shall pay the fees of his or its own attorneys, expenses of
          its witnesses and all other expenses connected with the preparation
          and presentation of such party's case, including any costs involved in
          filing and instituting such arbitration, if it is the initiating
          party.

     c.   The arbitration shall be conducted pursuant to the Rules, as then in
          effect.

     d.   The decision of the arbitrator shall be binding upon all parties and
          no appeal may be taken therefrom; provided, however, that no decision
          by such arbitrator shall include the award of punitive damages. The
          decision of the arbitrator shall be enforced and honored by the
          parties hereto without the necessity of confirmation by a court. The
          parties hereby waive, to the extent permitted by law, any rights to
          appeal or to review of any such decision by any court or tribunal.

     e.   This arbitration shall be conducted in New York City, New York. In the
          event a party desires to obtain judicial confirmation of an
          arbitration award, the parties consent to the exclusive jurisdiction
          of the appropriate state court in New York, New York for the entry and
          enforcement of a judgment upon any arbitration award rendered in
          connection with any state law, and of the United States District Court
          for the Southern District of New York, for the entry and enforcement
          of judgment upon any arbitration award rendered in connection with any
          federal law, and the parties agree to both subject matter and in
          personam jurisdiction for those purposes.

     f.   Notwithstanding any provision of this Section, the requirement to
          arbitrate disputes under this Section shall not apply to any
          application for interim injunctive or other equitable relief from any
          court of competent jurisdiction with respect to this Agreement or any
          matter it contemplates.

28.  COMPUTER PROGRAMS; INTELLECTUAL PROPERTY.

     a.   COMPANY acknowledges that NEWROADS owns all right, title and interest
          in and to all computer software, databases, other computer-related
          material and all procedures and processes used by NEWROADS in
          connection with the performance of its obligations under this
          Agreement (including but not limited to those developed by NEWROADS
          and modifications or new programs developed by NEWROADS for COMPANY)
          (collectively, the "PROCESS") and COMPANY has no right or interest
          whatsoever in such Process unless jointly developed and agreed upon in
          writing by both parties in advance of said joint development. NEWROADS
          acknowledges that COMPANY owns all right, title and interest in and to
          all the data being stored on the Process with respect to the provision
          of Services under this Agreement ("DATA"), and NEWROADS has no right
          or interest whatsoever in such Data. NEWROADS further agrees to enact
          strict measures to protect the confidentiality of such Data, in
          accordance with COMPANY'S policy as communicated in writing to
          NEWROADS from time to time.

     b.   NEWROADS(TM) is a service mark owned by NEWROADS. No rights to use of
          NEWROADS' marks are granted herein, and any right to use NewRoads
          marks, subsequently granted, will terminate immediately upon the
          termination of this Agreement. COMPANY shall use NEWROADS' marks only
          and strictly in accordance with the quality control and trademark
          usage policies of NEWROADS. Failure to comply with such policies will
          result in termination of the right to use such marks.

     c.   COMPANY'S service marks and trademarks are owned by COMPANY. No rights
          to use of COMPANY'S marks are granted

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<PAGE>
          herein, and any right to use Company marks, subsequently granted, will
          terminate immediately upon the termination of this Agreement. NEWROADS
          shall use COMPANY's marks only and strictly in accordance with the
          quality control and trademark usage policies of COMPANY. Failure to
          comply with such policies will result in termination of the right to
          use such marks.

29.  INSTRUCTION WITH RESPECT TO ACTS OF TERRORISM OR HAZARDOUS SUBSTANCES.
     Prior to the processing of Merchandise, the COMPANY shall give to NEWROADS
     policies and procedures to follow in the event that any consumer contacts
     NEWROADS with a complaint that a product processed by NEWROADS on behalf of
     the Company contains any hazardous substance. Provided NEWROADS follows
     such policies and procedures and, subject to the provisions of Section
     herein, entitled Representations and Warranties, NEWROADS shall have no
     liability to the COMPANY arising from such an event and the COMPANY shall
     expressly defend, indemnify and hold harmless NEWROADS from any all claims,
     damages, demands, causes of action, losses, liabilities, injuries, costs
     and expenses (including reasonable attorney's fees) arising from such an
     event.

30.  BUSINESS DAY. For purposes hereof, "BUSINESS DAY" shall mean any day other
     than (1) a Saturday or Sunday or (2) a day when the Federal Reserve Bank of
     New York is not open.

31.  RELATIONSHIP. Nothing contained in this Agreement shall be construed to
     imply a joint venture, partnership or principal/agent relationship between
     the parties. Except as specifically set forth herein, neither party by
     virtue of this Agreement shall have any right, power or authority to act or
     create any obligations, express or implied, on behalf of, or for the use of
     the other party, and NEWROADS and COMPANY shall not be obligated,
     separately or jointly, to any third party by virtue of this Agreement.

32.  HEADINGS. The headings and section numbers appearing in this Agreement are
     inserted only as a matter of convenience and in no way define, limit,
     construe or otherwise describe the scope or intent of the sections of this
     Agreement.

33.  SEVERABILITY. If any one or more provisions of this Agreement shall be
     invalid, illegal or unenforceable in any respect, the validity, legality
     and enforceability of the remaining provisions contained herein shall not
     in any way be affected or impaired; provided, however, that in such case
     the parties agree to use their commercially reasonable efforts to achieve
     the purpose of the invalid provision by a new legally valid provision.

34.  NO WAIVER. No failure or delay on the part of any party in the exercise of
     any right hereunder shall operate as a waiver thereof, nor shall any single
     or partial exercise of any such right preclude any other or further
     exercise thereof or of any other right. All rights and remedies under this
     Agreement are cumulative to, and not exclusive of, any rights or remedies
     otherwise available.

35.  FULL AGREEMENT. This Agreement, any exhibits and addenda attached hereto,
     properly executed Statements of Work, orders for Special Services and
     properly delivered notices, contain and embody the entire agreement of the
     parties hereto, and no representations, inducements, or agreements, oral or
     otherwise made at any time between the parties or with any third party
     relating to the subject matter hereof which are not contained in this
     Agreement or in the exhibits or addenda, if any, shall be of any force or
     effect. The parties recognize and agree that this agreement is separate
     from the Services Agreement dated March 31, 2000, between Alloy, Inc.
     (f/k/a Alloy Online, Inc.), and Distributions Associates, Inc., and that
     this Master Services Agreement shall have no effect on the Services
     Agreement of March 31, 2000, and the reverse shall also be true.

36.  COUNTERPARTS. This Agreement may be executed in one or more counterparts,
     all of which taken together shall be deemed one original.

37.  JOINT MARKETING. COMPANY will provide a statement to be used in a NEWROADS
     press release, which announces the choice of NEWROADS to provide Services.
     COMPANY authorizes NEWROADS to use its logo on the NEWROADS website, at
     tradeshows and events and on marketing collateral. NEWROADS and COMPANY may
     participate in other joint press releases, as deemed appropriate, when
     mutually agreed to by both companies.

38.  CESSATION OF OPERATIONS. In the event NEWROADS ceases operations, COMPANY
     shall have the first right of refusal to acquire the facilities and
     equipment, which are then in use to provide Services under this Agreement.


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IN WITNESS WHEREOF, Company has executed this Agreement effective the date first
above written and NEWROADS has executed and accepted this Agreement effective
the same date.

NEWROADS, INC.                        ALLOY, INC. ("COMPANY")

By: /s/ Michael Shelton               By: /s/ Samuel A. Gradess
   -----------------------------         ---------------------------------------

Name:  Michael Shelton                 Name:  Samuel A. Gradess
     ---------------------------           -------------------------------------

Title: Senior Vice President          Title:  Chief Financial Officer/ Secretary
      --------------------------            ------------------------------------

Date:  February 1, 2002                Date:  February 1, 2002
     ---------------------------           -------------------------------------


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