<PAGE>


                                       INTERIM
                        CONSUMER CREDIT CARD PROGRAM AGREEMENT


    This Consumer Credit Card Program Agreement (hereinafter the "Agreement")
is made as of the 13th day of March, 1996 by and between Monogram Credit Card
Bank of Georgia, a Georgia banking corporation with its principal place of
business at 7840 Roswell Road, Atlanta, Georgia 30350 and Lechmere Inc. a
Massachusetts corporation with its principal place of business and chief
executive office at 275 Wildwood, Woburn, Massachusetts 01801 ("Retailer").


                                 W I T N E S S E T H
                                 - - - - - - - - - -

    WHEREAS, Bank (as hereinafter defined) has established programs to extend
customized revolving credit to qualified customers for the purchase of Goods and
Services (as hereinafter defined) from various merchants for personal, family or
household purposes;

    WHEREAS, Retailer through its Retailer Locations (as hereinafter defined)
is engaged, among other activities, in the retail sale of consumer Goods and
Services and desires to create an interim customized revolving credit card
program, as more particularly set forth herein;

    WHEREAS, Retailer has requested that Bank extend credit to qualified
customers of Retailer for the purchase of such Goods and Services at Retailer
Locations;

    WHEREAS, Bank has agreed to provide Retailer with such a program for credit
extension at Retailer Locations as set forth herein, initially for Accounts that
have been created pursuant to the terms of this Agreement and, after GE Capital
purchases certain accounts and indebtedness from Hurley State Bank relating to
Retailer, all Accounts and Indebtedness including those purchased from Hurley
State Bank;

    WHEREAS, the parties intend to replace this Agreement as soon as
practicable by the Long Term Agreement; and

    NOW, THEREFORE, in consideration of the terms, conditions and mutual
covenants contained herein, and for good and valuable consideration the receipt
and sufficiency of which are hereby acknowledged, Bank and Retailer agree as
follows:

<PAGE>


                                      ARTICLE I
                                     DEFINITIONS

SECTION 1.01  CERTAIN DEFINED TERMS.  As used in this Agreement, the following
terms shall have the following meanings (such meanings to be equally applicable
to both the singular and plural forms of the terms defined):

    "ACCOUNT"  means and includes the following: (i) any open-end revolving
Credit Card Agreement, whether now existing or hereafter created between a
Cardholder and Bank under the Program, pursuant to which such Cardholder may
finance Purchases on credit pursuant to the terms of such Credit Card Agreement,
together with any modifications or amendments which now or hereafter may be made
to such Credit Card Agreement, which Account is owned by Bank, and which Account
is to be used for personal, family or household purposes, as well as Old
Accounts (ii) any and all Account Documentation; (iii) all of the accounts,
accounts receivable, Indebtedness, other receivables, contract rights, choses in
action, general intangibles, chattel paper, instruments, documents and notes,
Program Documents and contract rights related to, comprising, securing or
evidencing the obligation, or the receivables therefrom and all proceeds of all
of the foregoing, (iv) any and all rights as to any goods or other property
which is represented thereby or is security or collateral therefor; (v) all
guarantees, claims, security interests, or other security held by or granted to
Bank to secure payment by any Person with respect thereto; (vi) proceeds
relating to Insurance Programs; and (vii) any and all other rights, remedies,
benefits, interests and titles, both legal and equitable, to which Bank may now
or at anytime hereafter be entitled in respect of the foregoing.

    "ACCOUNT DOCUMENTATION" means with respect to an Account, any and all
documentation relating to an Account, including without limitation, Program
Documents, Credit Cards, Credit Card Applications, Credit Card Agreements,
Charge Transaction Data, Charge Slips, Credit Slips, checks and stubs, credit
bureau reports, adverse action information, change of terms notices,
correspondence, memoranda, documents, instruments, certificates, agreements and
invoices, including any and all amendments or modifications thereto, however
stored or kept, and any other written information relating to an Account.

    "ACTIVE ACCOUNT" means any Account other than an Account that has been
written off in accordance with Bank's write-off


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<PAGE>

policies, which at any time during a Billing Period has a debit or credit
balance.

    "AFFILIATE" shall mean, with respect to any Person, each Person that
controls, is controlled by or is under common control with such Person.  For the
purpose of this definition, "control" of a Person shall mean the possession,
directly or indirectly, of the power to direct or cause the direction of its
management or policies, whether through the ownership of voting securities, by
contract or otherwise.  "Affiliate" shall not include any individual, and no
individuals shall be taken into account in any determinations under this
definition, and (b) neither General Electric Company, nor any of its
subsidiaries, shall be considered an Affiliate of Retailer.

    "BANK" means Monogram Credit Card Bank of Georgia and its permitted
successors, transferees and assigns.

    "BILLING DATE" means the last day of a Billing Period as of which Accounts
are billed by Bank.

    "BILLING PERIOD" means the elapsed time between Billing Dates of Bank,
usually between 28 and 32 days.

    "BUSINESS DAY"  means any day, except Saturday, Sunday, or a day on which
banks are required or permitted to be closed in Georgia.

    "CARDHOLDER" means any natural Person with a mailing address in, or who
resides in, the United States and who has entered into a Credit Card Agreement
with Bank or who is or may become obligated under or with respect to an Account,
for the purpose of purchasing Goods and/or Services from Retailer or its
Licensee for personal, family or household purposes on credit pursuant to an
Account.

    "CARDHOLDER LIST" has the meaning given to it in Section 3.06 hereof.

    "CHARGE SLIP" means a sales receipt, register receipt tape or other invoice
or documentation, in each case evidencing a Purchase that (i) is to be charged
to a Cardholder's Account and to be advanced by Bank to Retailer on behalf of
such Cardholder or (ii) was charged on an Old Account.

    "CHARGE TRANSACTION DATA" means Account/Cardholder identification and
transaction information with regard to each Purchase by Cardholders on credit
and each return of a Purchase


                                          3

<PAGE>

for credit to the Account/Cardholder, which data will be transmitted by Retailer
to Bank in accordance with the applicable Operating Procedures.

    "CREDIT CARD" or "CARD" means the plastic card issued and owned by Bank
under the Program exclusively for use with the Program which evidences a
Cardholder's right to make Purchases under the Program.

    "CREDIT CARD AGREEMENT" means the open-end revolving credit agreement
between Bank and each Cardholder pursuant to which such Cardholder may make
Purchases, on credit provided by Bank, together with any modifications or
amendments which may be made to such agreement.

    "CREDIT CARD APPLICATION" means Bank's credit application which must be
completed by applicants who wish to become Cardholders and submitted to Bank in
Georgia for review and approval by Bank.

    "CREDIT PROMOTION ACCOUNT" shall have the meaning assigned to such term in
Section 2.03(c).

    "CREDIT SLIP" means a sales credit receipt evidencing a return or exchange
of Goods or a credit on an Account, including an Old Account, as an adjustment
for Services rendered or not rendered by Retailer or a Licensee to a Cardholder.

    "DEFAULT" means any event the occurrence of which, with the passage of time
or the giving of notice or both, would constitute an Event of Default.

    "EVENT OF DEFAULT" shall have the meaning assigned to such term in Section
10.01 hereof.

    "FINAL LIQUIDATION DATE" shall mean the date on which Bank no longer owns
any Active Accounts that have a balance outstanding.

    "FLOOR RELEASE" means the maximum amount of credit for any single credit
transaction authorized by Bank whereby Retailer may release Goods and/or
Services to Cardholders without securing prior approval by Bank as set forth in
the Operating Procedures.

    "GOODS AND/OR SERVICES", separately or cumulatively, means all merchandise
and services which may be purchased by Cardholder from Retailer or a Licensee.
Goods and Services shall include


                                          4

<PAGE>

Insurance Programs and Value-Added Programs to the extent purchased on an
Account.

    "INDEBTEDNESS" means any and all amounts owing from time to time with
respect to an Account (including an Old Account), including, without limitation,
any unpaid balances, finance charges, late fees, charges relating to Insurance
Programs and Value-Added Programs and any other charges with respect to an
Account, whether billed or unbilled.

    "IN-STORE PAYMENTS" means any payment on an Account made by a Cardholder
(or any person acting on behalf of a Cardholder) at a Retailer Location in
accordance with Section 3.07.

    "INSURANCE PROGRAM" means any program which may be offered through Bank
pursuant to Section 3.04 under which Bank or any insurance company or other
third party makes available insurance coverage to Cardholders.

    "LICENSEE" means any Person who pursuant to an agreement with Retailer, is
permitted from time to time by Retailer to make credit sales of Goods and/or
Services to Cardholders pursuant to or utilizing Credit Card Agreements.

    "LOSSES" has the meaning given to it in Section 12.01 hereof.

    "LONG TERM AGREEMENT" means an agreement between the parties hereto which
replaces this agreement and has among other provisions loss sharing and
promotional funding provisions.

    "NET CREDIT VOLUME" means, with respect to any period, an amount equal to
the aggregate amount of Purchases on Accounts for such period (as reflected in
Charge Transaction Data) less the sum of (x) the aggregate amount of Credit
Slips for such period (as reflected in Charge Transaction Data) and (y) the
aggregate amount of chargebacks for such period not otherwise reflected in such
Credit Slips.

    "NEW RETAILER" means any Person engaged in the operation of retail
appliance and/or electronics stores, together with any other Person directly or
indirectly controlled by such Person and any franchisees of such Person using
such Person's name, logo, trademarks and service marks or similar proprietary
designations claimed, owned or used by such Person.


                                          5

<PAGE>

    "OLD ACCOUNTS" means all revolving charge accounts established by Hurley
State Bank with respect to Retailer that are acquired directly or indirectly by
Bank.

    "OPERATING PROCEDURES" means the instructions and procedures to be followed
by Retailer in connection with the Program, as such instructions and procedures
may be amended from time to time.

    "PERSON" means and includes any individual, partnership, joint venture,
corporation, trust, unincorporated organization or government or any department
or agency thereof.

    "POS NETWORK" means the electronic communication system between Retailer
and Bank to facilitate the operation of the Program.

    "PROGRAM" means the credit card program established by Bank pursuant to
this Agreement and made available to qualified customers of Retailer and
Licensees to make Purchases.  The term "Program" includes the extension of
credit by Bank to Cardholders, billings, collections, accounting between the
parties, and all aspects of the customized revolving credit plan contemplated
herein.

    "PROGRAM DOCUMENTS" has the meaning given to it in Section 3.01 hereof.

    "PURCHASE(S)" means the purchase by a Cardholder of any of the Goods
and/or Services, including those which may be purchased from Retailer or
Licensees at the Retailer Locations.

    "RETAILER LOCATION(S)" means retail stores within the continental United
States and other means to conduct retail business that are owned or operated by
Retailer or its Licensees at which Purchases may be made by Cardholders from
Retailer or Licensees.

    "RETAILER NAMES" has the meaning given to it in Section 14.07 hereof.

    "SOLVENT" as to a Person, means (a) the present fair salable value of such
Person's assets is in excess of the total amount of its liabilities, (b) such
Person is presently able generally to pay its debts as they become due, and (c)
such Person does not have unreasonably small capital to carry on such Person's
business as theretofore operated and all business in which such Person is about
to engage.  The phrase "present fair salable


                                          6

<PAGE>

value" of a Person's assets is intended to mean that value which can be obtained
if the assets are sold within a reasonable time in arm's-length transactions in
an existing and not theoretical market.

    "TRANSACTION DAY" means any day, whether or not a Business Day, on which
Goods and/or Services are sold by Retailer or Licensees.

    "UCC" means the Uniform Commercial Code of the jurisdiction with respect to
which such term is used, as in effect from time to time.

    "UNCONTESTED AMOUNT" means an amount owed by Bank to Retailer or by
Retailer to Bank, as the case may be, pursuant to the terms of this Agreement
and with respect to which written notice disputing such amount has not been
delivered by Bank to Retailer or by Retailer to Bank, as the case may be.

    "VALUE-ADDED PROGRAM" means any products or services which may, subject to
mutual approval of Bank and Retailer, be offered by or through Bank to
Cardholders pursuant to Section 3.05 that enhance the features of the Program
and/or Account including, without limiting the foregoing, credit card protection
plans, legal services, auto clubs and extended warranties; provided, however,
that the term shall not be deemed to include credit insurance or any offerings
falling within the definition of "Insurance Program".

    SECTION 1.02  MISCELLANEOUS.  As used herein, (i) all references to the
plural number shall include the singular number (and vice versa); (ii) all
references to the masculine gender shall include the feminine gender (and vice
versa) and (iii) all references to "herein," "hereof," "hereunder,"
"hereinbelow," "hereinabove" or like words shall refer to this Agreement as a
whole and not to any particular section, subsection or clause contained in this
Agreement.  All other undefined terms contained herein shall, unless the context
indicates otherwise, have the meanings provided for by the UCC of the State of
Georgia to the extent the same are used or defined therein.


                                      ARTICLE II
                               ESTABLISHMENT OF PROGRAM


SECTION 2.01  COMMENCEMENT OF PROGRAM; MERCHANT TO HONOR CREDIT CARD.


                                          7

<PAGE>

    (a)  Pursuant to the terms and conditions of this Agreement, Retailer and
Bank hereby establish the Program for the purpose of making open-end credit
available (up to such credit limits as Bank may from time to time establish and
modify) to qualified customers of Retailer for Purchases from Retailer
Locations.  Prior to the time Bank obtains accounts and indebtedness, directly
or indirectly, from Hurley State Bank relating to Retailer, the Program shall be
limited to establishing Accounts for Persons who request Bank to open an
Account.  After such time, Bank will also make credit available with respect to
Old Accounts unless this Agreement has been replaced by the Long Term Agreement.

    (b)  With respect to each applicant under the Program who qualifies for
credit under the standards established solely by Bank, Bank will open an
Account, issue to such qualified applicant a Credit Card, activate such
applicant's Credit Card in accordance with the Operating Procedures and grant
credit to such applicant for any Purchases from Retailer Locations in accordance
with credit limits.  The terms and conditions upon which a Cardholder may use
the Credit Card and upon which Bank may extend credit to a Cardholder shall be
governed by the Credit Card Agreement between the Cardholder and Bank.

    (c)  Retailer will participate in the Program and honor any valid Credit
Card issued by Bank for Purchase(s) (including taxes) at each Retailer Location.
Only the cash selling price of Goods and Services sold or rendered by Retailer
shall be charged to Accounts.  Sales and services to commercial enterprises
shall not be charged to Accounts.  Retailer shall permit customers with Accounts
to charge Goods and Services to their Accounts, subject to and in accordance
with the Operating Procedures.

SECTION 2.02  BANK TO EXTEND CREDIT.

    Subject to (i) the terms of this Agreement, (ii) the credit limits
applicable to each Account and (iii) the terms and conditions in the Credit Card
Agreement, Bank shall extend credit to Cardholders in amounts set forth as the
total for any Purchase(s) reflected in Charge Transaction Data received and
accepted by Bank.

SECTION 2.03  PROMOTION OF PROGRAM.

    (a)  During the term of this Agreement, Retailer will actively promote the
Program.  Retailer shall include Program information and/or actual Credit Card
Applications and Credit Card Agreements in their general and specialized
brochures


                                          8

<PAGE>

advertising when deemed appropriate by Retailer management.  Retailer shall make
available at the Retailer Locations Credit Card Applications and Credit Card
Agreements to be used in connection with the Program in such manner as mutually
agreed by Retailer and Bank.  Any press releases, advertisements, publicity or
other materials which promote the Program, including the Program Documents,
shall not be publicly distributed or disseminated without the prior consent of
Retailer and Bank; provided, however, that (i) Bank shall not be required to
obtain Retailer's consent for any portion of a document containing disclosures
or other information which in Bank's judgment is required by or appropriate to
comply with, any applicable law, rule or regulation; and (ii) Retailer shall not
be required to obtain Bank's consent for any materials regarding the Program
that are limited to statements or other representations (either oral, written or
visual) that the Card may be used for Purchases.

    (b)  From time to time Bank shall make available to Retailer, to
encourage Account acquisition and usage, certain credit-based promotions to
include, without limiting the foregoing, (i) 90 Day Skip Free Promotions,
with respect to which Retailer will pay Bank monthly the amount of
[       ]*.  Such estimated amounts will be reconciled upon completion of
each credit promotion.  No credit promotion of a type other than specified
above may be run unless agreed to in writing by the parties hereto.

    (c)  Bank shall establish on its books an account known as the "Credit
Promotions Account."  This Credit Promotions Account shall be non-interest
bearing, shall not represent segregated funds and may be commingled by Bank with
other funds.  The Credit Promotions Account shall be maintained as follows:

         (i)  On the date hereof, Retailer shall pay Bank an amount equal to
    what Bank reasonably estimates to be the anticipated [       ]*
    that Retailer will owe Bank under this SECTION 2.03(B) during the term
    of this Agreement (the "Anticipated Credit Promotion Amount").  The
    amount of such payment shall be credited to the Credit Promotions Account.
    If Bank debits the Credit Promotions Account (as specified in the first
    sentence of


*Confidential treatment has been requested with respect to this information.


                                          9

<PAGE>

    subparagraph (ii) below), Retailer shall immediately pay Bank such amount
    and such amount when paid shall be credited to the Credit Promotions
    Account.

        (ii)  Bank will debit the Credit Promotions Account where Retailer
    fails to pay Bank when due the amount Retailer has been billed by Bank with
    respect to credit promotions.

       (iii)  After termination of this Agreement and at such time Retailer no
    longer is obligated to make payments with respect to credit promotions
    hereunder, Bank shall debit the Credit Promotions Account for the balance
    thereof and pay such amount to Retailer.


                                     ARTICLE III
                              ADMINISTRATION OF PROGRAM


SECTION 3.01  PREPARATION OF DOCUMENTS.

    (a)  Subject to the provisions of Section 2.03, Bank and Retailer shall
cooperate and assist each other in the preparation of all documents to be used
in connection with the Program.  Bank shall provide Retailer with the form and
content of Credit Card Applications, Credit Card Agreements, Credit Cards,
credit card mailers and such other documents as are requested by Retailer,
required by law or pursuant to the Operating Procedures (hereinafter
collectively, the "Program Documents").  Bank shall establish the nature and
quantities of any such documents.

    (b)  Bank shall be responsible for the direct costs of billing statements,
Credit Cards (including costs of embossing and distributing Credit Cards) and a
host-to-host computer link between Bank and Retailer.  All Program Documents,
Credit Cards and other forms shall clearly disclose that Bank is the creditor.
No Program Documents shall be printed or utilized on a widespread or general
basis unless Bank and Retailer have expressly approved the form and content of
such documents in writing; provided, however, that if any such changes to the
documents are required by law, rule or regulation, then Bank shall not be
required to obtain Retailer's approval for any such change.

    (c)  Retailer shall be solely responsible for all other costs and expenses
of Program Documents, including, without limitation, Credit Card Applications,
credit advertising, in-


                                          10

<PAGE>

store point-of-purchase promotional materials and credit marketing expenses
related to the promotion of the Program.

SECTION 3.02  ACCOUNT ADMINISTRATION; CREDIT CRITERIA.

    (a)  Bank, in its sole discretion, shall determine the creditworthiness of
individual applicants under the Program, the range of credit limits to be made
available to individual Cardholders, whether to suspend or terminate credit
privileges of any Cardholder, the credit criteria to be used in evaluating
applicants in connection with the Program, and shall establish all of the terms
and conditions of the Credit Card Agreement and the terms and conditions under
which credit is extended to Cardholders and may modify all such terms and
conditions from time to time in its sole discretion.

    (b)  The rejection for credit of any applicant under the Program, or any
number of applicants, shall not give rise to any claim, liability, demand,
offset, defense, counterclaim or other right or action by Retailer against Bank
or its Affiliates, and Retailer hereby waives and releases any such claim that
it may have against Bank or its Affiliates.

SECTION 3.03  OWNERSHIP OF ACCOUNTS.  Bank shall be the sole and exclusive owner
of all Accounts, Account Documentation, Cardholder data, Charge Transaction
Data, Charge Slips, Credit Slips and receipts or evidences of payment or
purchases by Cardholder and other Program Documents, and shall be entitled to
receive all payments made by Cardholders on Accounts, and Retailer acknowledges
and agrees that it has no right, title or interest in any of the foregoing and
no right to any payments made by Cardholders on Accounts or any proceeds in
respect of the Accounts.  All collection procedures shall be under the sole
control and discretion of Bank and may be modified from time to time by Bank,
provided that Bank will provide Retailer notice prior to implementation of
material modifications to its collection procedures.

SECTION 3.04  INSURANCE SOLICITATION OF ACCOUNTS.  Bank, or its agents, may
solicit Cardholders for Insurance Programs with the written agreement of
Retailer.  In the absence of such agreement, Retailer or its designee may
solicit Cardholder for Insurance Programs.

SECTION 3.05  VALUE-ADDED SOLICITATION OF ACCOUNTS.  Bank, or its agents, may,
with Retailer's prior written consent, solicit Cardholders for Value-Added
Programs.  Unless otherwise requested in writing by Retailer, such solicitation
shall in no way state


                                          11

<PAGE>

or infer that such Value-Added Programs are offered or endorsed by Retailer in
any manner.  In the absence of such consent, Retailer or its designee may
solicit Cardholders for Value-Added Programs.

SECTION 3.06  USE OF CARDHOLDER LIST.  Although Retailer acknowledges and agrees
that Bank is the sole owner of all lists of applicants, Cardholders, Cardholder
names and addresses, and all credit information, including that for approved and
declined applicants (hereafter the "Cardholder List"), Bank expressly agrees
that both during the term of this Agreement or thereafter, Bank will not sell,
rent or use such Cardholder List except in connection with its administration
and operation of the Program as provided in this Agreement; provided, however,
that upon the termination of this Agreement however caused, then Bank shall be
entitled to use the Cardholder List as provided in Section 11.05.  Bank agrees
that during the term of this Agreement Retailer may utilize the Cardholder List
at no charge for promotion of this Program or of Goods and Services; provided,
however, that until the Final Liquidation Date in no event shall Retailer or its
Affiliates be entitled to use such Cardholder List to solicit Cardholders with
respect to any other debit, credit or charge programs that are in competition
with Bank or its Affiliates.

SECTION 3.07  IN-STORE PAYMENTS. Retailer shall not advertise or otherwise
promote that Cardholders (or other Persons acting on behalf of Cardholders) may
make In-Store Payments.  Without derogating the restriction in the preceding
sentence, if any In-Store Payment is made, Retailer shall give the person making
such In-Store Payment a receipt for such payment, but payments shall not be
deemed to be made to Bank until funds are either delivered to Bank or the
payments are applied by Bank to reduce amounts payable by Bank to Retailer.
Retailer shall transmit In-Store Payment information to Bank.  In-Store Payments
shall be credited to the Account of the relevant Cardholder as of the date of
actual receipt by Bank.  In-Store Payments received by Retailer shall reduce the
amounts payable by Bank to Retailer.  In the event that In-Store Payments
received by Retailer exceed amounts so payable by Bank to Retailer at the time
Retailer informs Bank of such In-Store Payments, Retailer shall be required to
transmit such excess In-Store Payments to Bank within three (3) Business Days of
the day received.  Retailer shall notify Bank of any In-Store Payments within
twenty-four (24) hours of receipt thereof by providing such information in a
computer-readable medium.  Retailer shall cease to accept In-Store Payments upon
notice from Bank which notice may be given (a) upon the occurrence of an Event
of Default caused by Retailer or (b) such time as Bank has


                                          12

<PAGE>

a reasonable basis for believing an Event of Default caused by Retailer is
likely.


                                      ARTICLE IV
                                 OPERATING PROCEDURES


SECTION 4.01  GENERAL.  Retailer shall follow all applicable Operating
Procedures relative to the Program including, but not limited to, distributing
Credit Card Applications, seeking authorizations for Accounts, handling credit
transactions with Cardholders and transmitting Charge Transaction Data.  The
Operating Procedures may be amended from time to time by Bank.  Bank shall
provide Retailer with prior Notice of material modifications to the Operating
Procedures.  The parties recognize and agree that from time to time
modifications and improvements will be made in hardware, software, and data
communications facilities that may, in Bank's discretion, result in changes in
the Operating Procedures.

SECTION 4.02  NEW CARDHOLDER ACCOUNT ESTABLISHMENT PROCEDURES.

    (a)  All Credit Card Applications will be reviewed by Bank for approval and
credit line assignment.

    (b)  Bank will forward Credit Cards for approved Accounts and activate such
Credit Cards.

    (c)  Retailer will not submit any corporate accounts or any accounts for
other than personal, family or household purposes under this Agreement;
provided, however, that any breach or violation of this paragraph shall not
constitute a breach of this Agreement which could give rise to an Event of
Default pursuant to Article X, but instead shall give rise to a chargeback
pursuant to Article VII.


SECTION 4.03  PURCHASE AUTHORIZATION PROCEDURES.  Retailer agrees that all
purchase authorizations shall be conducted in accordance with the Operating
Procedures.


                                      ARTICLE V
                      SETTLEMENTS; SERVICE FEES AND ADJUSTMENTS


SECTION 5.01  SETTLEMENT PROCEDURES.


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<PAGE>

    (a)  All Charge Transaction Data will be electronically transmitted to Bank
using the POS Network. Retailer, or an agent of Retailer, will retain copies of
all Charge Slips.

    (b)  Upon receipt, verification and processing of Charge Transaction Data
by Bank, Bank will remit to Retailer an amount equal to [       ]*  for the
Transaction Day(s) for which such remittance is being made less any amounts
required or permitted to be deducted from remittances pursuant to the terms
of this Agreement.  Bank will transfer funds to a bank designated in writing
by Retailer via wire transfer. If Charge Transaction Data is received by
Bank's processing center before 11:00 AM Eastern Time on a Business Day, Bank
will initiate such wire transfer on the following Business Day.  In the event
that the Charge Transaction Data is received after 11:00 AM Eastern Time,
then Bank will initiate such transfer on the second following Business Day.

    (c)  Retailer authorizes Bank to microfilm (or copy using any other
reasonable method) all documentation within the definition of Account and
Program Documents and destroy all such original Account Documentation in the
ordinary course of business as Bank may see fit, and in accordance with
applicable laws.

    (d)  In connection with the settlement procedures outlined above, the
parties agree that all settlements made hereunder shall be net of any and all
other adjustments contemplated by this Agreement, including but not limited to
credits, other adjustments and chargebacks pursuant to the Agreement.  Bank
shall have the right to set off any amounts due to it pursuant to this Agreement
against any amounts to be transmitted to Retailer hereunder.  Bank agrees that
in reference to the settlement procedures outlined herein it will, on at least a
monthly basis, provide Retailer with a statement detailing the amount, if any,
of adjustments, credits, chargebacks or other amounts set off against amounts
due to Retailer.


SECTION 5.02  OTHER ADJUSTMENTS.  Any costs or expenditures by the parties to
this Agreement other than as explicitly set forth herein shall be at the sole
expense of the party incurring such costs or other expenditures and shall not
entitle that party to seek reimbursement of such costs or other expenditures
from the other party to this Agreement.  Accordingly, subject to the
reimbursement provisions of this Agreement, if any, each of the parties alone
shall be liable for the payment of all sums due third parties retained by such
party in performing its obligations hereunder.


*Confidential treatment has been requested with respect to this information.


                                          14

<PAGE>

SECTION 5.03  PAYMENT TO BANK.  Bank will invoice Retailer monthly for all
appropriate expenses payable by Retailer pursuant to this Agreement including,
without limitation, expenses payable by Retailer pursuant to Section 5.02, and
Retailer agrees to pay Bank within 15 days of the date of receipt of such
invoice.  In lieu of such invoicing, Bank may upon reasonable notice reduce
remittances made pursuant to Section 5.01 by the amount of such expenses.


                                      ARTICLE VI
                      CREDIT TERMS; LOSSES ON ACCOUNTS; SECURITY


SECTION 6.01  CREDIT TERMS.  Bank shall have the sole right to establish the
rate, annual fees, late fees and all other terms and conditions relating to the
Accounts, and to amend or modify such rate, fees and/or terms from time to time.
The initial terms and conditions relating to the Accounts will be a variable
finance charge equal to the prime rate plus 13.15% with a 21.9% minimum (except
in the so-called opt-out states) and the payment term will be 1/40th per month
with a $10 minimum (except for "big ticket" items the payment term will be
1/50th per month with a $10 minimum).  Bank shall give Retailer prior notice of
any changes in such terms and conditions.

SECTION 6.02  LOSSES ON ACCOUNTS.  Under this Agreement, which is an interim
agreement, all losses on Accounts shall be solely borne [       ]*.

SECTION 6.03  GRANT OF SECURITY INTEREST; PRECAUTIONARY FILING.  The parties
hereto agree that the transactions contemplated herein shall constitute a
program for the extension of consumer credit and service to customers of
Retailer.  Both (i) against the possibility that it is determined that Article 9
of the UCC applies or may apply to the transactions contemplated hereby, and
(ii) to secure payment of and performance by Retailer of any and all
indebtedness, liabilities or obligations, now existing on hereafter arising
whatsoever of Retailer to Bank, however arising, pursuant to this Agreement,
including indebtedness, liabilities and obligations that may be deemed to exist
in the event of the applicability of Article 9 of the UCC to, and any
recharacterization of, any transactions contemplated hereby, Retailer hereby
grants to Bank a first priority continuing security interest in and to all of
Retailer's right, title and interest now owned or existing or hereafter acquired
or arising


*Confidential treatment has been requested with respect to this information.


                                          15

<PAGE>

in, to and under the following property (in each case, existing at any time,
past, present or future) together with the proceeds thereof:  (A) all Accounts,
Indebtedness and Program Documents; (B) all deposits, credit balances and
reserves on Bank's books relative to any Accounts, including, but not limited to
the Credit Promotions Account and (C) all proceeds of the foregoing.  All
creditors of Retailer seeking to obtain a security interest in any of the
foregoing collateral shall be required to subordinate their security interests
to the security interest of Bank in the foregoing collateral as a condition
precedent to obtaining any such security interest.  Retailer agrees to cooperate
fully with Bank as Bank may reasonably request in order to give effect to the
security interest granted by this Section 6.03, including, without limitation,
the filing of UCC-l or comparable statements in order to perfect such security
interest.  For filing purposes, Retailer agrees to provide Bank with not less
than 30 days prior written notice of any change in location of its executive
offices or principal place of business or any change of its corporate name and,
notwithstanding the foregoing, no such change shall be effected before Retailer
shall have supplied Bank signed copies of all filings and actions as Bank may
reasonably determine to be necessary or appropriate to preserve and maintain at
all times the perfection and priority of the security interests granted or
purported to be granted to Bank hereunder.


                                     ARTICLE VII
                                      CHARGEBACK

SECTION 7.01  BANK'S RIGHT TO CHARGEBACK.  Bank shall have the right, at its
option, to chargeback to Retailer [       ]* if with respect to such Charge
Slip or Credit Slip, or the underlying transaction, including those in
connection with an Old Account, under the following circumstances:  (a)
unidentifiable media, (b) unauthorized charges, (c) failure to obtain proper
identification, (d) adjustments, (e) missing media and/or (f) Old Account
chargebacks.  It is the responsibility of Bank to provide Retailer with the
following information, if available, with respect to all chargebacks:
account name, account number, address, Merchandise description, issuing
Retailer Location, amount, and reason for chargeback.  Following are
guidelines for the issuing of chargebacks which must be complied with.

              1.   UNIDENTIFIABLE MEDIA.  Unidentifiable media is media that
does not have a valid account number, or media with


*Confidential treatment has been requested with respect to this information.


                                          16

<PAGE>

an account number that is illegibly imprinted or written in.  Bank will directly
request the media from the issuing Retailer Location.  The issuing Retailer
Location is responsible for providing a legible copy of the media with correct
account number to Bank within ten (10) days of notice to the issuing Retailer
Location.  Bank has the right to chargeback to Retailer if (a) the Retailer
Location has not responded to the request for media before expiration of the ten
(10) day period, and (b) Bank after reasonable efforts is unable to identify the
Indebtedness represented by the media with a valid account number.
Notwithstanding the foregoing, all chargebacks by Bank for unidentifiable media
must occur within sixty (60) days of the sale date.  Retailer has sixty (60)
days after the date of the chargeback to complete additional research and, if
successful, reverse the chargeback whereupon such Indebtedness shall again
become Indebtedness with respect to which Bank shall make payment to Retailer.

              2.   UNAUTHORIZED CHARGES.  An unauthorized charge is a sale that
has been abstracted without Bank approval.  (These charges will lack an approval
code from the P.O.S. system, have an invalid authorization code, lack an
approval code from the credit center, or lack an approval code for amounts over
the floor limit when floor limits are in effect.  It is understood that charges
that are equal to or less than the floor limit when it is in effect will be
deemed authorized).  Bank and Retailer shall work closely to continue the charge
authorization control mechanisms in place in Retailer Locations and to develop
new mechanisms to minimize violations of the authorization system.  Bank may
immediately chargeback to Retailer unauthorized charges that are made on a
stolen plate or a fraudulent account, provided that Bank has notified Retailer
of the unauthorized charges within thirty (30) days of its receipt of a
complaint from a Cardholder.  In addition, Bank may chargeback to Retailer other
unauthorized charges to an Account that is or becomes delinquent (based on the
methodology for determining defaulted indebtedness then in effect), provided
that Bank has notified Retailer of the unauthorized charges within thirty (30)
days of Bank's discovery of the unauthorized charges.

              3.   FAILURE TO OBTAIN PROPER IDENTIFICATION. Subject to
applicable law, failure to obtain proper identification refers to all credit
purchases made by a customer shopping without a Credit Card or a priority credit
pass where a Retailer Location fails to require the customer to identify himself
with a valid permanent driver's license or other state issued identification for
his state of residence.  Tickets or temporary licenses are not acceptable.  The
name, address, and


                                          17

<PAGE>

signature on the driver's license must correspond with the name, address, and
signature on the Charge Slip.  If the customer does not have a valid driver's
license or other state issued identification, the credit center supervisor on
duty will instruct the salesperson to ask for other appropriate identification.
In any instance where positive identification is required, the document used for
identification must be noted on the Charge Slip.  If in the process of
investigating a customer dispute it is determined that the issuing Retailer
Location failed to obtain proper identification in the manner required pursuant
to these provisions and a fraudulent charge resulted, Bank may chargeback to
Retailer.  Notwithstanding the foregoing, in no event may Bank chargeback to
Retailer any items described in this subsection later than sixty (60) days after
Bank discovers the failure.

              4.   ADJUSTMENTS.  Requests received by Bank from customers for
adjustments will be promptly communicated by Bank directly to the issuing
Retailer Location.  Such adjustment requests that are not frivolous and that are
not resolved by Retailer within eighteen (18) days of notification to Retailer
may be charged back by Bank to Retailer.  Notwithstanding the foregoing, in no
event may Bank chargeback to Retailer any adjustments described in this
subsection later than thirty (30) days after receipt of the request for
adjustment from the customer.

              5.   MISSING MEDIA.  Requests received by Bank from customers for
supporting sales media will be promptly communicated by Bank directly to the
issuing Retailer Location.  Retailer is responsible for providing Bank with the
requested media within ten (10) days of receipt of the request.  Indebtedness
represented by media not provided within such ten (10) day period may be charged
back by Bank to Retailer.  Retailer has thirty (30) days after the chargeback to
locate the media and reverse the chargeback whereupon such Indebtedness shall
again become Indebtedness to be paid by Bank.  Notwithstanding the foregoing, in
no event may Bank chargeback to Retailer any items described in this subsection
later than thirty (30) days after the receipt of the request for adjustment from
the customer.

              6.   OLD ACCOUNT CHARGEBACKS.  To the extent not already covered
in items 1 through 5, requests received by Bank from customers for credits or
adjustments relating to the period prior to Bank's ownership of the Old Accounts
which Bank reasonably believes relate to Retailer's handling of the transactions
giving rise to the Charge Slips or Credit Slips at


                                          18

<PAGE>

issue, including requests for credits/adjustments relating to Goods and/or
Services or the information furnished by Retailer with respect to a credit
promotion.

SECTION 7.02  LIMITATION OF CHARGEBACK.  In its reasonable discretion Bank
may compromise and settle any claim made by any Cardholder if such claim may
give Bank a right to chargeback in accordance with Section 7.01 up to
[       ]*,  of any Charge Slip or Credit Slip.  In the event of any such
compromise or settlement, Bank shall obtain Retailer's prior written approval
to adjust the Cardholder's Account and Bank's right to chargeback shall be
limited to the actual amount so compromised.

SECTION 7.03  EXERCISE OF CHARGEBACK.  If Bank exercises its right of
chargeback in accordance with this Agreement, Bank shall set off amounts
charged back against any sums due Retailer under this Agreement or, if
chargebacks exceed sums due Retailer, Bank may demand payment from Retailer
for the full amount of such excess.  If  [       ]*, Bank shall assign,
without recourse, all right to payment for such Charge Slip or portion
thereof to Retailer upon the request of Retailer.

                                     ARTICLE VIII
                         WARRANTIES AND COVENANTS OF RETAILER


SECTION 8.01  ACCOUNT COVENANTS.  Retailer covenants to do the following during
the term of this Agreement with respect to each transaction involving an Account
or the Program:

    (a)  Retailer shall respond to, and cooperate with, Bank promptly in
connection with the resolution of disputes with Cardholders;

    (b)  Retailer shall maintain a policy for the exchange and return of Goods
and adjustments for Services rendered or not rendered that is in accordance with
all applicable laws and shall promptly deliver a Credit Slip to the Cardholder
and include credit for such return or adjustment in the Charge Transaction Data
in accordance with the Operating Procedures in the event the return/exchange has
been authorized in accordance with Retailer's policies;


*Confidential treatment has been requested with respect to this information.


                                          19

<PAGE>

    (c)  Retailer shall not seek or obtain any special agreement or condition
from, nor discriminate in any way against, Cardholders with respect to the terms
of any transaction.

SECTION 8.02  GENERAL REPRESENTATIONS AND WARRANTIES.  To induce Bank to
establish and administer this Program, all as herein provided for, Retailer
makes the following representations and warranties to Bank, each and all of
which shall survive the execution and delivery of this Agreement, and each and
all of which shall be deemed to be restated and remade on each day on which any
Account is opened or Charge Transaction Data is submitted to Bank or any action
is taken with respect to the Program:

    (a)  Existence.  Retailer (i) is duly organized, validly existing, and in
good standing under the laws of the Commonwealth of Massachusetts, (ii) is duly
qualified and in good standing under the laws of each jurisdiction where its
ownership or lease of property or the conduct of its business require such
qualification; (iii) has the requisite power and authority and the legal right
to own and operate its properties, to lease the properties it operates under
lease, and to conduct its business as now conducted and hereafter contemplated
to be conducted; (iv) has all necessary licenses, permits, consents, or
approvals from or by, has made all necessary notices to all governmental
authorities having jurisdiction, to the extent required for such current
ownership and operation or as proposed to be conducted; and (v) is in compliance
with its organizational documents.

    (b)  Power, Authorization; Enforceable Obligation.  The execution,
delivery, and performance of this Agreement and all instruments and documents to
be delivered by Retailer hereunder: (i) are within its corporate power; (ii) has
been duly authorized by all necessary or proper or corporate action; (iii) does
not and will not contravene any provisions of its organizational documents; (iv)
will not violate any law or regulation or any order or decree of any court or
governmental instrumentality; (v) will not conflict with or result in the breach
of, or constitute a default under any indenture, mortgage, deed of trust, lease,
agreement, or other instrument to which it is a party or by which it or any of
its assets or property are bound, including without limitation, any arrangement
which Retailer has with Hurley State Bank which arrangement has been modified as
set forth in Section 8.02(i); and (vi) do not require any filing or registration
with or the consent or approval of any governmental body, agency, authority, or
any other Person which has not been made or obtained previously.  This Agreement
has been duly executed and delivered by each Retailer, and constitutes a legal,
valid, and


                                          20

<PAGE>

binding obligation of such Retailer, enforceable against such entity in
accordance with its terms.

    (c)  Solvency.  Retailer is Solvent.

    (d)  No Violations.  Retailer is not in default with respect to any
material contract, agreement, or other instrument to which it is a party nor has
it received any notice of default under any such material contract, agreement,
lease or other instrument.

    (e)  No Burdensome Restrictions.  No contract, lease agreement, or other
instrument to which Retailer is a party or by which Retailer is bound, and no
provision of applicable law or governmental regulation, materially and adversely
affects or may so affect the business, operation, prospects, property, or
financial or other condition of Retailer.

    (f)  Information Correct.  All information furnished by the Retailer to
Bank for purposes of or in connection with this Agreement or any information
hereafter furnished by the Retailer to Bank, is true and correct to the best of
Retailer's knowledge in all material respects and, to the best of Retailer's
knowledge, no such information omits to state a material fact necessary to make
the information so furnished not misleading.  There is no fact known to the
Retailer which the Retailer has not disclosed to Bank which could materially and
adversely affect the financial condition, business, property, or prospects of
the Retailer.

    (g)  No Default.  No Event of Default or Default with respect to Retailer
has occurred and is continuing.

    (h)  Name and Address.  The chief executive office and principal place of
business of Retailer is set forth on page 1 of this Agreement, but will be moved
to Chicago, Illinois within one month of the date of this Agreement.  Lechmere
Inc. is the only name under which Retailer conducts business.

    (i)  Consent of Hurley State Bank.  Retailer has obtained the consent of
Hurley State Bank to enter into this Agreement with Bank and to establish
Accounts relating to Retailer pursuant to the Program, and Hurley State Bank has
waived all rights it has to object to this Program.  Such consent is attached
hereto.

SECTION 8.03  ADDITIONAL AFFIRMATIVE COVENANTS OF RETAILER.  Until the later of
(i) the date on which this Agreement terminates and (ii) the Final Liquidation
Date, Retailer will, unless Bank shall otherwise consent in writing:


                                          21

<PAGE>

    (a)  If Retailer is subject to the reporting requirements of Section 13 or
Section 15(d) of the Securities Exchange Act of 1934, as amended (i) as soon as
reasonably available and in any event within 90 days after the close of its
fiscal year, submit to Bank an audited annual report of Retailer's annual
earnings, including its audited consolidating balance sheets, income statements
and statement of cash flows and changes in financial position and (ii) promptly
after the filing thereof, submit to Bank copies of all proxy statements, and all
reports on Forms 10-K, 10-Q, and 8-K filed with the Securities and Exchange
Commission by Retailer;
    (b)  If Retailer is not subject to the reporting requirements of Section 13
or Section 15(d) of the Securities Exchange Act of 1934, as amended (i) as soon
as reasonably available and in any event within 90 days after the close of its
fiscal year, submit to Bank an audited annual report of Retailer's annual
earnings, including its audited consolidating balance sheets, income statements
and statement of cash flows and changes in financial position and (ii) as soon
as reasonably available and in any event within 45 days after the close of each
of its fiscal quarters, submit to Bank an unaudited quarterly report of
Retailer's earnings, including its consolidating balance sheets, income
statements and statement of cash flows and changes in financial position,
accompanied by the certification on behalf of Retailer by Retailer's chief
financial officer that such financial statements were prepared in accordance
with generally accepted accounting principles applied on a consistent basis and
present fairly the financial position of Retailer as of the end of such fiscal
quarter and the results of its operations;

    (c)  Comply in all material respects with all laws with respect to
Retailer, its business, and properties.

    (d)  Promptly upon receipt, deliver to Bank copies of any communications
relating to an Account from a Cardholder, or any governmental or regulatory
authority.

    (e)  Permit Bank, during normal business hours and upon reasonable notice,
to visit the offices of Retailer from time to time, and shall permit Bank from
time to time to discuss the Program with Retailer and their officers and
employees and to examine the books and records of Retailer relating to the
Program or have the same examined by Bank's attorneys and/or accountants.  In
connection therewith, Retailer agrees, subject to applicable privacy and other
laws, to make data regarding the Program available to Bank, and in connection
therewith to permit Bank to make copies of such documentation.


                                          22

<PAGE>

    (f)  Retailer shall take all reasonable measures as conveyed by Bank to
comply with the provisions of 12 USC Section 1972(1)(B).

SECTION 8.04  ADDITIONAL NEGATIVE COVENANTS OF RETAILER.  Until the later of (i)
the date on which this Agreement terminates, and (ii) the Final Liquidation
Date, Retailer will not, unless Bank shall otherwise consent in writing:

    (a)  Except with respect to Retailer's existing arrangement with Hurley
State Bank, promote any other presently existing program for open-end or closed-
end consumer accounts more favorably than the Program or engage in any selection
process with respect to accounts that could be adverse to Bank.

    (b)  Except with respect to Retailer's existing arrangement with Hurley
State Bank, advertise, promote, sponsor, solicit, permit solicitation of, or
make available to customers of Retailer or otherwise provide at any Retailer
Location any credit program, credit facility, credit card program, charge
program or debit or secured card program or facility which is similar in purpose
or effect to this Program (whether open-end, closed-end, private label or third
party), other than (i) credit provided in connection with the Program hereunder,
(ii) credit provided by generally accepted multi-purpose credit or charge cards
such as American Express, Mastercard, Visa and the Discover card or by any
generally accepted multi-purpose debit or secured cards (provided that none of
the cards referred to in this clause (ii) may be "co-branded", "sponsored" or
"co-sponsored" with Retailer and provided the Retailer Names or any variations
thereof do not appear on such cards), (iii) credit provided on a closed end
basis where Bank has previously rejected extending credit to the applicant under
this Program and (iv) any credit provided through a credit card bearing the name
Montgomery Ward or Electric Ave & More.


                                      ARTICLE IX
                           WARRANTIES AND COVENANTS OF BANK


SECTION 9.01  REPRESENTATIONS AND WARRANTIES OF BANK.  To induce Retailer to
enter into this Agreement and participate in the Program, all as herein provided
for, Bank makes the following representations and warranties to Retailer, each
and all of which shall survive the execution and delivery of this Agreement, and
each and all of which shall be deemed to be restated and remade on each day on
which Accounts are opened and Charge Transaction Data submitted or any action
taken with respect to the Program:


                                          23

<PAGE>

    (a)  Corporate Existence.  Bank (i) is a banking corporation duly
organized, validly existing, and in good standing under the laws of the State of
Georgia; (ii) has the requisite corporate power and authority and the legal
right to own, pledge, mortgage, and operate its properties, to lease the
properties it operates under lease, and to conduct its business as now conducted
and hereafter contemplated to be conducted; and (iii) is in compliance with its
articles of incorporation and bylaws.

    (b)  Corporate Power, Authorization; Enforceable Obligations.  The
execution, delivery, and performance of this Agreement and all instruments and
documents to be delivered by Bank hereunder: (i) are within Bank's corporate
power; (ii) have been duly authorized by all necessary or proper corporate
action; (iii) do not and will not contravene any provision of Bank's certificate
of incorporation or bylaws; (iv) will not violate any law or regulation or an
order or decree of any court or governmental instrumentality to which Bank is
subject; (v) will not conflict with or result in the breach of, or constitute a
default under, any indenture, mortgage, deed of trust, lease agreement, or other
instrument to which Bank is a party or by which Bank or any of its property is
bound; and (vi) do not require any filing or registration by Bank with or the
consent or approval of any governmental body, agency, authority, or any other
Person which has not been made or obtained previously.  This Agreement has been
duly executed and delivered by Bank, and constitutes the legal, valid, and
binding obligation of Bank, enforceable against Bank in accordance with its
terms.

    (c)  Solvency.  Bank is Solvent.

    (d)  No Default.  No Event of Default or Default with respect to Bank has
occurred and is continuing.

SECTION 9.02  AFFIRMATIVE COVENANT OF BANK.  Promptly upon receipt, deliver to
Retailer copies of any communications relating to any material investigation by
any governmental or regulatory authority with respect to the Program.


                                      ARTICLE X
                        EVENTS OF DEFAULT; RIGHTS AND REMEDIES


SECTION 10.01  EVENTS OF DEFAULT.  The occurrence of any one or more of the
following events (regardless of the reason therefor) shall constitute an "Event
of Default" hereunder:


                                          24

<PAGE>

    (a)  Either party shall fail to pay the other any Uncontested Amount when
due and payable and the same shall remain unpaid for a period of three (3) days
after the other party shall have made written demand therefor.

    (b)  Either party shall fail or neglect to perform, keep, or observe any
term provision, condition, or covenant contained in this Agreement that is
required to be performed, kept, or observed by it, and the same shall remain
uncured for a period of thirty (30) days after the other party shall have given
written notice thereof.

    (c)  Any representation, warranty or statement, made or delivered by either
party or any of its respective officers shall not be true and correct in any
material respect as of the date when made or reaffirmed and such failure to be
true and correct has a material adverse effect on its ability to perform its
obligations hereunder.

    (d)  Either Bank or Retailer (i) shall no longer be Solvent; (ii) shall
generally not pay its debts as such debts become due, or shall admit in writing
its inability to pay its debts generally; (iii) shall make a general assignment
for the benefit of its creditors; or (iv) any proceeding shall be instituted by
or against it seeking to adjudicate it a bankrupt or insolvent or seeking
liquidation, winding up, reorganization, arrangement, adjustment, protection,
relief, or composition of it or its debts under any law relating to bankruptcy,
insolvency, or reorganization or relief of debtors, or seeking the entry of an
order for relief or the appointment of a receiver, trustee, custodian or other
similar official for it or for any substantial part of its property, and, in the
case of any proceeding instituted against it (but not instituted by it), either
such proceeding shall remain undismissed or unstayed for a period of 30 days, or
any of the actions sought in such proceeding (including, without limitation, the
entry of an order for relief against, or the appointment of a receiver, trustee,
custodian or other similar official for, it or any substantial part of its
property) shall occur; or either party shall take any corporate action to
authorize any of the actions set forth above in this paragraph (d).

    (e)  Retailer shall be in default under any loan agreement, indenture or
other instrument relating to any indebtedness for borrowed money in excess of
[       ]*, and such default gives any party, either with or without notice
and without giving effect to any extension of any grace period, the right to
accelerate such indebtedness.


*Confidential treatment has been requested with respect to this information.


                                          25

<PAGE>

    (f)  Final judgment or judgments for the payment of money in excess of
[       ]* in the aggregate shall be rendered against any Retailer and the same
shall not be either (i) covered by insurance or the insurer shall not have
accepted liability therefor or (ii) vacated, stayed, bonded, paid, or discharged
prior to expiration of the applicable appeal period.

    (g)  A material adverse change has occurred in the operations, financial
condition, business or prospects of Retailer which Bank has determined, in good
faith, has impaired or is reasonably likely to impair, the ongoing operation or
continued viability of the Program; in each case, as determined by Bank, in its
sole discretion.

    (h)  Accounts, Indebtedness, Charge Slips or proceeds thereof in an
aggregate amount of [       ]* or more shall be (or shall purportedly be)
(i) attached, seized, levied upon or subject to a writ by a creditor of
Retailer, or shall come within the possession of any receiver, trustee,
custodian, or assignee for the benefit of creditors of Retailer or (ii) subject
to any lien or right of any third party directly or indirectly arising by,
through or on account of Retailer or any creditor thereof.

SECTION 10.02  REMEDIES.

    (a)  If any Event of Default shall have occurred and be continuing, all of
the defaulting party's payment obligations hereunder shall, in the non-
defaulting party's sole discretion, be deemed immediately due and payable.

    (b)  If any Event of Default shall have occurred and be continuing, the
non-defaulting party shall have any and all rights and remedies under this
Agreement. In addition, the Bank, if not the defaulting party, may discontinue
originating or offering Accounts, accepting Charge Slips, or otherwise extending
credit, and may declare this Agreement terminated.


                                      ARTICLE XI
                                   TERM/TERMINATION


SECTION 11.01  TERM.  This Agreement shall continue in full force and effect
until and including the earlier of August 31, 1996 or until a Long Term
Agreement is executed.

SECTION 11.02  TERMINATION.


*Confidential treatment has been requested with respect to this information.


                                          26

<PAGE>

    (a)  Retailer shall have the right to terminate this Agreement upon thirty
(30) days written notice if an Event of Default shall occur with respect to
Bank.

    (b)  Bank shall have the right to terminate this Agreement upon thirty (30)
days written notice if an Event of Default shall occur with respect to Retailer.

    (c)  Notwithstanding anything to the contrary contained in this Agreement,
Bank may engage Retailer in the good faith renegotiation of this Agreement if
usury rates of the State of Georgia change, or if laws regulating Bank's rate
structure change, or if federal or state regulation or authority preempts the
exportation of Bank's rate structure, which in Bank's reasonable judgment could
have a material adverse effect on Bank or its prospects, operations, or
condition or its ability to perform the transactions contemplated hereby.  In
the event of a renegotiation pursuant to this Section 11.02(c), if new terms
acceptable to the parties are not agreed upon in writing within 30 days after
the date renegotiations begin, this Agreement shall be deemed terminated as of
the earlier of (i) the [50]th day after such renegotiation begins, or (ii) the
date Bank is required to initiate changes to the Program to comply with
applicable law.

SECTION 11.03  PURCHASE OF ACCOUNTS BY RETAILER PRIOR TO THE TERMINATION DATE.
Retailer shall have the option, exercisable as provided below, to purchase or to
arrange for the purchase of the portfolio of Accounts under the following terms
and conditions:

    (a)  In the event of a termination of this Agreement pursuant to Sections
11.01, 11.02(a), 11.02(c) or 11.04, Retailer shall have the right to purchase
or to arrange for the purchase of the portfolio of Active Accounts,
(including the Cardholder List) at a repurchase price equal to [       ]*
payable in immediately available funds. Retailer shall exercise such right by
giving written notice to Bank within 30 days of the date of the notice of
termination of the Agreement, which notice shall specify a date for the
repurchase which date shall be not more than 90 days after the date of the
notice, and shall thereafter complete such purchase on such date, or such
other date as may be agreed to by Retailer and Bank.  If Retailer fails to
exercise such option (by failing to deliver the notice required by this
Section 11.03(a)) then the option shall expire.

    (b)  In the event of a termination of this Agreement pursuant to
Section 11.02(b), Retailer shall have the right to


*Confidential treatment has been requested with respect to this information.



                                          27

<PAGE>

purchase or to arrange for the purchase of the portfolio of Active Accounts
(including the Cardholder List) at a repurchase price equal to the product of
[       ]*, payable in immediately available funds.  Retailer shall exercise
such right by giving written notice to Bank within 30 days of the date of the
notice of termination of this Agreement, which notice shall specify a date for
the repurchase which date shall be not more than 90 days after the effective
date of the termination and shall thereafter complete such purchase on such
date, or such other date as may be agreed to by Retailer and Bank.  If Retailer
fails to exercise such option (by failing to deliver the notice required by this
Section 11.03(b)) then the option shall expire.

SECTION 11.04  TERMINATION FOR FORCE MAJEURE.

    (a)  This Agreement may be terminated by either Bank or Retailer without
penalty after the passing of sixty (60) days following the notice by one party
to the other that its performance hereunder is prevented or materially impeded,
without the ability to cure, by one of the following force majeure events; acts
of God, fire, explosion, accident, war, nuclear disaster, riot or material
changes in applicable laws or regulations rendering it illegal, impossible or
untenable for the notifying party or its ultimate parent corporation to perform
as contemplated in this Agreement.

    (b)  Any such failure to perform shall not be considered a breach of this
Agreement during the period of such disability (i.e., prior to sixty (60) days),
if the disabled party promptly advises the other party in writing that it is
unable to perform due to such a force majeure event, setting forth; (i) the
nature of the event; (ii) its expected effects(s) and duration; (iii) any
expected development which may further affect performance hereunder and (iv) the
efforts which will be made to cure such force majeure or provide substitute
performance.

    (c)  Such sixty (60) day period may be shortened upon written agreement
executed by duly-authorized officers of each party or if required by applicable
law or regulation.

SECTION 11.05  LIQUIDATION OF ACCOUNTS.

    (a)  Upon the termination of this Agreement, each party shall be required
to fulfill its respective obligations hereunder (unless prohibited by law) until
the Final Liquidation Date or there is some other disposition thereof in
accordance with either Section 11.03 or 11.05.


*Confidential treatment has been requested with respect to this information.



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<PAGE>

    (b)  Upon any such termination of this Agreement, should Retailer not
purchase or arrange for a purchase of the Accounts from Bank, then:



         (i)  Bank shall have the right, in addition to and retaining all other
         rights it may have under the terms of this Agreement or applicable law
         to:

              (A)  liquidate the remaining Accounts in any lawful manner which
              may be expeditious or economically advantageous to Bank including
              the issuance of a replacement or substitute Card; and

              (B)  use the Retailer Names in accordance with the provisions of
              this Agreement in communicating with existing Cardholders until
              the Final Liquidation Date.

         (ii) Retailer expressly agrees that in complying with its obligations
         to accept substitute or replacement Cards, Retailer will cooperate
         with Bank in order to effectuate any such liquidation or replacement
         or substitute card issuance in an orderly manner, including but not
         limited to, at Bank's request accepting in the manner as in effect
         immediately prior to such termination the Credit Cards and any
         replacement or substitute credit cards for up to 24 months following
         the effective date of termination of the Agreement.

SECTION 11.06  ADDITIONAL TERMINATION PROVISIONS.

    (a)  Except as otherwise expressly provided herein, any termination of this
Agreement shall in no way affect or impair the powers, obligations, duties,
rights and liabilities of Retailer or Bank, including, without limitation, those
under Article XII hereof, relating to any transaction or event occurring prior
to such termination.

    (b)  Notwithstanding the termination of this Agreement for any reason,
until the Final Liquidation Date: (i) the license granted to Bank pursuant to
Section 14.07 hereof shall continue in effect after the effective date of
termination of this Agreement; (ii) the power of attorney granted to Bank
pursuant to Section 14.12 hereof shall continue in effect after the effective
date of termination of this Agreement; and (iii) the option


                                          29

<PAGE>

granted to Retailer to purchase the Accounts pursuant to Section 11.03 hereof
shall survive the termination of this Agreement unless and until such option
shall expire in accordance with its terms.

    (c)  All undertakings, agreements, covenants, warranties, representations
and indemnities contained herein shall survive such termination, except as
specifically provided herein to the contrary.  Without in any manner limiting
the generality of the foregoing, upon such termination, Bank shall continue to
own the Accounts, and, except as provided herein, Retailer shall continue to be
liable for all obligations set forth herein until the Final Liquidation Date;
provided, however, that the parties' respective obligations pursuant to Article
XII and Section 14.13 shall survive the Final Liquidation Date.


                                     ARTICLE XII
                                   INDEMNIFICATION


SECTION 12.01  INDEMNIFICATION BY RETAILER.  Retailer agrees to protect,
indemnify, and hold harmless Bank, its Affiliates, and the employees, officers,
and directors thereof, from and against any and all losses, damages,
liabilities, costs, and expenses (including reasonable attorneys' fees and
expenses), judgments, damages, claims, demands, offsets, defenses,
counterclaims, actions, or proceedings ("Losses") by whomsoever asserted,
including, without limitation:  (i) the Cardholders or other persons responsible
for the payment of Accounts; (ii) any Person or persons who prosecute or defend
any proceedings as representatives of or on behalf of a class or interest
group;(iii) any governmental instrumentality; or (iv) any other third party
(including, without limitation, any Licensee), arising out of, connected with or
resulting from:

    (a)  Credit Card sales of Goods and Services;

    (b)  any transaction, contract, understanding, promise, representation, or
any other relationship, actual, asserted, or alleged, between Retailer and any
Cardholder relating to an Account;

    (c)  any Goods and Services (including, without limitation, any product
liability or warranty claim with respect thereto) the purchase of which was
financed by an Account;


                                          30

<PAGE>

    (d)  any other act, or omission where there was a duty to act, by Retailer
or its employees, officers, directors, agents, lessees, or any independent
contractors hired by a Retailer, relating to an Account or items of Indebtedness
relating to an Account;

    (e)  any breach by Retailer of any of the terms, covenants,
representations, warranties, or other provisions contained in this Agreement or
any other instrument or document delivered by Retailer to Bank in connection
herewith or therewith;

    (f)  the failure of Retailer to comply with all laws, rules or regulations
applicable to Retailer;

    (g)  any agreement, arrangement, understanding or course of dealing between
Retailer or any of its Affiliates and any Licensee.

Excluded from the foregoing indemnity shall be any Losses to the extent the same
arise out of or result from any violation by Bank or any of its Affiliates of
law, this Agreement, any Credit Card Agreement or any agreement, understanding
or promise between Bank and any Cardholder relating to such Cardholder's Account
which is not based on information provided by Retailer or its Affiliates.

SECTION 12.02  INDEMNIFICATION BY BANK.  Bank agrees to protect, indemnify, and
hold harmless Retailer, its Affiliates, and the employees, officers, and
directors thereof, from and against any and all Losses by whomsoever asserted,
including, but not limited to., (i) the Cardholders or other persons responsible
for the payment of Accounts; (ii) any Person or Persons who prosecute or defend
any proceedings as representatives of or on behalf of a class or interest group;
(iii) any governmental instrumentality; or (iv) any other third party, arising
out of, connected with or resulting from:

    (a)  any breach by Bank of any of the terms, covenants, representations,
warranties or other provisions contained in this Agreement.

    (b)  any transaction, contract, understanding, promise, representation, or
any other relationship, actual, asserted, or alleged, between Bank and any
Cardholder relating to an Account;

    (c)  any other act, or omission where there was a duty to act, by Bank or
its employees, officers, directors, shareholders, agents or licensees or any
independent contractors hired by Bank


                                          31

<PAGE>

relating to an Account or items of Indebtedness relating to an Account; or

    (d)  the failure of Bank to comply with any laws, rules or regulations
applicable to Bank.

Excluded from the foregoing indemnity shall be any Losses to the extent the same
arise out of or result from any violation by a Retailer or its Affiliates of
law, this Agreement, any Credit Card Agreement or any agreement, understanding
or promise between a Retailer and any Cardholder relating to such Cardholder's
Account which is not based on information provided by Bank or its Affiliates.

SECTION 12.03  PAYMENT OF INDEMNIFIED AMOUNTS.  After any final judgment or
award shall have been rendered by a court, arbitration board, or administrative
agency of competent jurisdiction and the time for an appeal of such judgment or
award has expired without an appeal being taken by either party, or after any
settlement agreed to by the parties shall have been consummated, the party
seeking indemnification shall forward to the other party notice of any sums due
and owing by such other party with respect to such matter and such party shall
be required to pay all of the sums so owing to the party seeking indemnification
within thirty (30) days after the date of such notice unless otherwise mutually
agreed to in writing by the parties.

SECTION 12.04  NOTICE.  Each party shall promptly notify the other party of any
claim, demand, suit or threat of suit of which that party becomes aware (except
with respect to a threat of suit either party might institute against the other)
which may give rise to a right of indemnification pursuant to this Agreement.
The indemnifying party will be entitled to participate in the settlement or
defense thereof and, if the indemnifying party elects, to take over and control
the settlement or defense thereof with counsel satisfactory to the indemnified
party.  In any case, the indemnifying party and the indemnified party shall
cooperate (at no cost to the indemnified party) in the settlement or defense or
any such claim, demand, suit or proceeding.


                                     ARTICLE XIII
                                   OTHER AGREEMENTS

SECTION 13.01  OTHER PROGRAMS.  If during the term of this Agreement Retailer
desires to make arrangements for the provision by any Person of either (i) any
private label commercial or


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<PAGE>

business credit program of facility for use at Retailer Locations or (ii) any
private label credit program or facility for use outside of the United States,
then Retailer shall discuss in good faith with Bank or an Affiliate the
possibility of Bank providing either or both of such programs.  If the parties
or an Affiliate are unable to mutually agree on terms and conditions pursuant to
which Bank or an Affiliate will provide one or both such programs, Retailer
agrees that it will not enter into any such programs with any other Person
unless they shall have first offered Bank or an Affiliate the opportunity to
provide such program(s) on the same or substantially similar terms and
conditions as such other Person would be willing to provide.  Nothing in this
Agreement shall restrict Retailer's rights to continue its existing relationship
with Hurley State Bank with respect to credit accounts existing at the time this
Agreement is executed.


                                     ARTICLE XIV
                                    MISCELLANEOUS

SECTION 14.01  ASSIGNABILITY.  Neither Bank nor any Retailer may assign its
rights and obligations under this Agreement without the prior written consent of
the other party, which consent shall not be unreasonably withheld; except that
Bank may without such prior written consent (i) assign all or part of its rights
and obligations under this Agreement to an Affiliate, or in connection with a
securitization or participation, or (ii) engage third parties to perform
services pursuant to this Agreement without such prior written consent.

SECTION 14.02  AMENDMENT.  This Agreement may not be amended except by written
instrument signed by the parties hereto.

SECTION 14.03  NON-WAIVER.  No delay by any party hereto in exercising any of
its rights hereunder, or in the partial or single exercise of such rights, shall
operate as a waiver of that or any other right.  The exercise of one or more of
any party's rights hereunder shall not be a waiver of, nor preclude the exercise
of, any rights or remedies available to such party under this Agreement or in
law or equity.

SECTION 14.04  SEVERABILITY.  If any provision of this Agreement is held to be
invalid, void or unenforceable, all other provisions shall remain valid and be
enforced and construed as if such invalid provision were never a part of this
Agreement.


                                          33

<PAGE>

SECTION 14.05  GOVERNING LAW.  This Agreement and all rights and obligations
hereunder, including, but not limited to, matters of construction, validity and
performance, shall be governed by and construed in accordance with the laws of
the state of Georgia without regard to internal principles of conflict of laws.

SECTION 14.06  CAPTIONS.  Captions of the Sections of this Agreement are for
convenient reference only and are not intended as a summary of such Sections and
do not affect, limit, modify or construe the contents thereof.

SECTION 14.07  USE OF RETAILER NAME AND MARK.

    (a)  Subject to and only in accordance with the provisions of this
Agreement, Retailer hereby grants Bank a non-exclusive license to create,
develop, market and administer the Program and to use the name of Retailer
(hereafter the "Retailer Names"), and the logos therefor, in the creation,
development, marketing and administration of the Program.  Retailer represents
that it owns the Retailer Names and has the right to grant such non-exclusive
license.

    (b)  Pursuant to the licenses granted to Bank pursuant to this Section
14.07, the parties understand and agree that until the latter of (i) the
termination of this Agreement and (ii) the Final Liquidation Date, Bank will, in
accordance with the provisions of this Agreement, use the Retailer Names in
connection with Bank's operation and administration of the Program and the
discharge of its obligations under the Agreement, including but not limited to
use in connection with Cardholder service; billing statements and inquiries;
credit card applications, agreements, mailers, and card carriers.

SECTION 14.08  SECURITIZATION/PARTICIPATION.  Any rights to purchase the
Accounts which Retailer may have hereunder shall be subject to Bank's right to
securitize or participate the Accounts and Indebtedness and such rights shall be
available to Retailer only with respect to Accounts Indebtedness owned by Bank
at the time of such purchase.

SECTION 14.9  FURTHER ASSURANCES.  Each party hereto agrees to execute all such
further documents and instruments and to do all such further things as the other
party may reasonably request in order to give effect and to consummate the
transactions contemplated hereby.

SECTION 14.10  ENTIRE AGREEMENT.  This Agreement and a letter agreement of even
date is the entire agreement of the parties


                                          34

<PAGE>

with respect to the subject matter hereof and supersedes all other prior
understandings and agreements whether written or oral.

SECTION 14.11  NOTICES.  All notice, demands and other communications hereunder
shall be in writing and shall be sent by hand, by facsimile (with verbal
confirmation of receipt) or by nationally recognized overnight courier service
addressed to the party to whom such notice or other communication is to be given
or made at such party's address as set forth below, or to such other address as
such party may designate in writing to the other party from time to time in
accordance with the provisions hereof and shall be deemed given one Business Day
after being sent, as follows:

if to
Retailer: Lechmere Inc.
          619 West Chicago Avenue
          Chicago, Illinois  60671
          Att:  Chief Executive Officer
          with a copy to Secretary/Legal
          at the same address.


and if to
Bank:     Monogram Credit Card Bank of Georgia
          7840 Roswell Rd.
          Building 100
          Suite 210
          Atlanta, Georgia  30350
          Attention:  Senior Vice President
          Telecopier No.: 770/353-2464
          with a copy to
          RFS Counsel
          260 Long Ridge Road
          Stamford, Connecticut  06927
          Telecopier No.: 203/961-5149

Provided, however, that if either of the above parties shall have designated a
different address by notice to the other, then to the last address so
designated.

SECTION 14.12  POWER OF ATTORNEY.  Retailer authorizes and empowers Bank and
grants to Bank power of attorney (i) to sign and endorse Retailer name on all
checks, drafts, money orders or other forms of payment in respect of Accounts
under the Agreement; (ii) to do all the things reasonably necessary to carry out
or enforce the Accounts; (iii) to sign such Retailer's


                                          35

<PAGE>

name on any notices to any Cardholder in connection with the collection of
Accounts; (iv) to send requests for verification of any Account to Cardholders;
(v) to sue Cardholders for the collection of Accounts; and (vi) to do any and
all things Bank determines may be necessary or appropriate to carry out or
enforce the obligations of Cardholders under Credit Card Agreements.  This
limited power of attorney conferred hereby is deemed a power coupled with an
interest and shall be irrevocable prior to the Final Liquidation Date.

SECTION 14.13  CONFIDENTIAL INFORMATION.

    (a)  All proprietary and non-public material and information supplied by
Retailer to Bank or vice versa heretofore or hereafter, or supplied to Retailer
or Bank by Cardholders or applicants for Credit Cards, including, without
limitation, (i) the pricing and other financial terms of this Agreement,
(ii) information concerning the parties' marketing plans, objectives, financial
results and employee compensation and benefits, and (iii) the Customer List, is
confidential and proprietary ("Confidential Information").  Confidential
Information shall not include any information which (i) at the time of
disclosure by one party hereto or thereafter is generally available or known to
the public (other than as a result of an unauthorized disclosure by the other
party hereto); (ii) was available to one party on a non-confidential basis from
a source other than the other party (provided that such source, to the best of
one party's knowledge, was not obligated to the other party to keep such
information confidential); or (iii) was in one party's possession prior to
disclosure by the other party to it.

    (b)  Confidential Information shall be used by each party solely in the
performance of its obligations or exercise of its rights pursuant to this
Agreement.  Each party shall receive Confidential Information in confidence and
not disclose Confidential Information to any third party, except (i) as may be
necessary to perform its obligations or exercise its rights pursuant to this
Agreement or to effect a securitization or participation as provided in Section
14.08, (ii) except as may be agreed upon in writing by the other party, or (iii)
as otherwise required by law or judicial or administrative process.  Each party
will use its best efforts to ensure that its officers, employees, and agents
take such action as shall be necessary or advisable to preserve and protect the
confidentiality of Confidential Information.  Upon written request or upon the
termination of this Agreement, each party shall destroy or return to the other
party all Confidential Information in its possession or control, subject to the
each party's respective document


                                          36

<PAGE>

retention policies with respect to information required to be maintained by
regulatory authorities.

SECTION 14.14  INDEPENDENT CONTRACTOR.  Nothing contained in this Agreement
shall be construed to constitute Bank and Retailer as partners, joint venturers,
principal and agent, or employer and employee.  Bank will act hereunder solely
as an independent contractor and will exercise exclusive control over any and
all persons hired by it.

SECTION 14.15  THIRD PARTIES.  Bank shall have the right to engage third parties
to perform services pursuant to this Agreement.  In the event a party hereto
engages the services of subcontractors and/or other third parties to assist it
with the fulfillment of the terms hereunder, then such party agrees to be
responsible for and indemnify the other party hereto, its or their Affiliates
and the officers, directors, employees and agents of each, for any and all
claims (including reasonable legal costs and expenses) asserted by anyone
against such party and such Affiliates arising out of any and all work performed
by any such subcontractor and/or agent of such party in connection with this
Agreement.

SECTION 14.16  INTERPRETATION.  As each of the parties have contributed to the
drafting of the language of this Agreement, it is agreed and understood that in
any interpretation of this Agreement, the language utilized will be construed
equally as and between the parties without regard to which party provided the
language of any particular provision.

SECTION 14.17 PAYMENTS.  Unless otherwise provided, all payments due one party
from the other party shall be made within five (5) Business Days after notice of
the amount due.

SECTION 14.18  MULTIPLE COUNTERPARTS.  This Agreement may be executed in any
number of multiple counterparts, all of which shall constitute but one and the
same original.


                                          37

<PAGE>

    IN WITNESS WHEREOF, Bank and Retailer have caused this Agreement to be
executed by their respective officers thereunto duly authorized as the date
first above written.

                                  MONOGRAM CREDIT CARD BANK OF
                                       GEORGIA

                                  By:  /s/
                                      --------------------------

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

                                  LECHMERE INC.

                                  By: /s/
                                      --------------------------

                                  Title: Assistant Secretary
                                         -----------------------


                                          38