Exhibit 10.1(b)
                                            ---------------

                         LEASE

                        BETWEEN

                  AGAWAM SSI, L.L.C.,

         A DELAWARE LIMITED LIABILITY COMPANY,

                     AS LANDLORD,

                          AND

                 SCHOOL SPECIALTY INC.

               A WISCONSIN CORPORATION,

                       AS TENANT

             DATED AS OF NOVEMBER 3, 2000

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                   TABLE OF CONTENTS
                                                             Page
1.   Demise of Premises.                                        1
2.   Title and Condition.                                       1
3.   Use of Premises.                                           2
4.   Term.                                                      2
5.   Rent.                                                      3
6.   Net Lease; Non-Terminability.                              4
7.   Taxes and Assessments; Tax and Insurance Escrow;
     Compliance with Law; Environmental Matters.                5
8.   Indemnification.                                          10
9.   Liens.                                                    11
10.  Maintenance and Repair.                                   12
11.  Alterations.                                              13
12.  Insurance.                                                17
13.  Casualty.                                                 21
14.  Condemnation.                                             22
15.  Termination of Lease Following Major Casualty,
     Major Condemnation or Material Temporary Taking.          24
16.  Assignment and Subletting.                                25
17.  Intentionally Omitted.                                    27
18.  Financial Statements.                                     27
19.  Permitted Contests.                                       28
20.  Default Provisions.                                       29
21.  Additional Rights of Landlord.                            33
22.  Notices, Demands and Other Instruments.                   34
23.  Transfer by Landlord.                                     35
24.  Mortgaging by Landlord.                                   37
25.  Estoppel Certificates.                                    39
26.  No Merger.                                                39
27.  Surrender.                                                39
28.  Severability.                                             39

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29.  Savings Clause.                                           40
30.  Binding Effect.                                           40
31.  Memorandum of Lease.                                      40
32.  Table of Contents; Headings.                              40
33.  Governing Law.                                            40
34.  Certain Definitions.                                      40
35.  Assignment of Intangibles.                                41
36.  Representation and Warranties.                            42
37.  Exhibits.                                                 42
38.  Exculpatory Clause.                                       42
39.  Jury Waiver.                                              42
40.  Quiet Enjoyment.                                          42
41.  Early Termination Option.                                 43
42.  Landlord Initiated Financing.                             49

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                           EXHIBITS

Exhibit 1.1         Legal Description
Exhibit 5-1         Interim Term and Primary Term Basic Rent
Exhibit 5-2         Extended Term Basic Rent
Exhibit 2           Permitted Exceptions
Exhibit 15-1        Purchase Price Schedule
Exhibit 15-2        Additional Sales Closing Requirements
Exhibit 17          Determination of Fair Market Value
Exhibit 25-1        Estoppel Certificate
Exhibit 25-2        Estoppel Certificate
Exhibit 31          Memorandum of Lease
Exhibit 36          Representations and Warranties

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                 INDEX OF DEFINITIONS
                                Page                                      Page
Accrued Property Expenses         46   Late Charge                           3
Additional Rent                    3   Lease                                41
Adjusted Price                    44   Legal Requirements                   40
Affiliate                         45   Marketing Expenses                   43
Affiliated Group                  35   Marketing Period                     43
Alterations                       13   Material Temporary Taking            22
Alterations Budget                14   Minimum Price                        37
Bankruptcy Law                    30   Mortgage                             37
Bankruptcy Laws                   30   Mortgage Default Rate                 4
Basic Rent                         3   Mortgagee                            37
Basic Rent Payment Dates           3   Net Award                            23
C/C Purchase Offer                24   Net Insurance Proceeds               20
Casualty                          21   Net Sales Proceeds                   46
Competing Business                36   Non-Termination Taking               22
Condemnation                      22   Notice                               34
control                           45   Notice of Acceptance                 48
Damages                           10   Notice of Qualified Offer Rejection  47
Default Purchase Offer            32   Permitted Exceptions                  1
Default Rate                       4   Premises                              1
Discount Rate                     32   Primary Term                          2
Early Termination Closing Date    45   Prohibition Period                   45
Early Termination Notice          43   Property Insurance                   17
Early Termination Payment         46   Proposed Early Termination Date      43
Easements                         12   Purchase Contract                    45
Environmental Laws                 9   Qualified Offer                      44
Event of Default                  28   Qualified Transferee                 35
Excess Fees                       44   Rejected Qualified Offer             47
Extended Term                      2   Required Insurance                   17
Extension Notice                   2   Sale Notice                          36
Finance Election Notice           48   Scheduled Price                      44
Financing Expenses                49   SEC                                  26
Hazardous Material                 9   Severable Additions                  16
Imposition                        40   Taxes                                 5
Improvements                       1   Tenant                                1
Indemnified Parties                8   Tenant Easement                      42
Indemnified Party                  8   Tenant Easements                     42
Interest Savings                  48   Tenant's Pro Rata Portion            49
Interim Term                       2   Tenant's Purchase Notice             36
Land Parcel                        1   Tenant's Share of Financing Expenses 49
Landlord                           1   Term                                  2
Landlord Easement                 42   Termination Date                     24
Landlord Easements                42   Termination Notice                   24
Landlord Initiated Finance Notice 48

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                     LEASE

          THIS LEASE, dated as of November 3, 2000,
between AGAWAM SSI, L.L.C., an Delaware limited
liability company (herein, as further defined in
Paragraph 34, called "Landlord"), having an address at
c/o Mesirow Realty Sale-Leaseback, Inc., 350 North
Clark Street, Chicago, Illinois 60610, and SCHOOL
SPECIALTY INC., a Wisconsin corporation (herein called
"Tenant"), having an address at 1000 North Bluemound
Drive, Appleton, Wisconsin 54915.

          1.   Demise of Premises.

          In consideration of the rents and covenants
herein stipulated to be paid and performed, Landlord
hereby demises and lets to Tenant, and Tenant hereby
lets from Landlord, for the term herein described, the
premises (herein called the "Premises") consisting of:

          1.1  That parcel of land legally and commonly
described on Exhibit 1.1 attached hereto and made a
part hereof, together with all of Landlord's right,
title and interest, if any, in and to all easements,
rights of way, appurtenances, strips and gores of land,
mineral rights, water rights and other interests,
rights and benefits thereunto belonging, and to all
public or private streets, roads, avenues, alleys, or
passways, open or proposed, on or abutting the parcel
of land, and to any award made to or to be made in lieu
thereof, and in and to any award for damage to the
parcel of land or any part thereof by reason of a
change of grade in any street, alley, road or avenue,
as aforesaid (collectively, the "Land Parcel");

          1.2  The approximately 187,840 square foot
warehouse facility and other improvements of every kind
and description on, over and under the Land Parcel;
parking areas on the Land Parcel; and Landlord's right,
title and interest in all systems, building fixtures,
amenities, facilities, machinery and equipment used in
the operation of the facility and other improvements,
conduits, ducts, hot water heaters, oil burners,
domestic water systems, and installations including
those used to provide fire protection, heat, exhaust,
ventilation, air conditioning, electrical power, light,
plumbing, refrigeration, gas, sewer and water thereto,
all elevators, escalators, canopies, and the physical
structure of all signs (excluding any right to use any
trade names or trademarks of Tenant depicted on the
signs), which are used solely for the operation of the
building (collectively, the "Improvements"); but,
excluding Tenant's personal property and trade fixtures
(including without limitation Tenant's inventory, non-
building equipment, and non-building machinery used in
the operation of Tenant's business on the Premises).

          2.   Title and Condition.

          The Premises are demised and let subject to
(a) the rights of any parties in possession and the
existing state of the title as of the commencement of
the Term of this Lease, including those encumbrances
listed in Exhibit 2 (the "Permitted Exceptions"),
(b) any state of facts which an accurate survey or
physical inspection thereof might show, (c) all zoning

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regulations, restrictions, rules and ordinances,
building restrictions and other laws and regulations
now in effect or hereafter adopted by any governmental
authority having jurisdiction, and (d) the condition of
any buildings, structures and other improvements
located thereon, as of the commencement of the Term of
this Lease, without representation or warranty by
Landlord.  Tenant represents that it has been in
possession of the Premises prior to the commencement of
the Term of this Lease, has thoroughly familiarized
itself with the Premises in all respects, and has
examined the title to, zoning and other restrictions
applicable to and the condition of the Premises and has
found the same to be satisfactory to it.

          3.   Use of Premises.

          Subject to applicable Legal Requirements,
Tenant may use the Premises only for any use complying
with applicable zoning regulations, building
restrictions, rules and ordinances and other
restrictions contained in this Lease provided that any
new use arising after the Commencement Date does not
materially increase the environmental risk to the
Premises or increase the risk of any Hazardous Material
being released or discharged at or from the Premises or
any Environmental Laws being violated.

          4.   Term.

          Subject to the terms and conditions hereof,
Tenant shall have and hold the Premises for an interim
term (herein called the "Interim Term") commencing on
the date hereof and continuing until the last day of
the calendar month in which the date hereof occurs
(provided that if the Lease commences on the first day
of a calendar month there shall be no Interim Term) and
a primary term (herein called the "Primary Term")
commencing on the first day of the first calendar month
following the date hereof (except if this Lease
commences on the first day of a calendar month, the
Primary Term shall commence on said first day), and
continuing for twenty years.  Provided an Event of
Default does not exist as of the time any option is
exercised, Tenant shall have the option to extend this
Lease for four consecutive terms of five (5) years each
(herein individually called an "Extended Term" and,
together with the Interim Term if any and the Primary
Term, called the "Term"), unless this Lease shall
expire or be sooner terminated pursuant to the terms
hereof.  Tenant shall exercise its option to extend the
Term for an Extended Term only by giving written notice
(an "Extension Notice") to Landlord.  In order to
exercise its option to extend the Term for any Extended
Term, Tenant shall deliver such Extension Notice to
Landlord not earlier than twenty-four (24) months and
not later than twelve (12) months prior to the then-
scheduled expiration of the Term.  Upon the giving of
an Extension Notice, the Term shall be automatically
extended for such Extended Term on the terms and
conditions provided in this Lease, except that Tenant
shall have no further option to extend the Term beyond
said four additional periods of five (5) years each.
Upon the request of Landlord or Tenant, the parties
hereto will execute and exchange an instrument in
recordable form setting forth any extension of the Term
in accordance with this Paragraph 4 and Exhibit 5-2.
If Tenant does not timely give an Extension Notice in
accordance with the provisions of this Paragraph 4,
(i) Tenant shall thereafter have no right to extend the
Term and (ii) Landlord shall have the right during the
remainder of the Term to

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advertise the availability of the Premises for sale or
reletting and to erect upon the Premises signs appropriate
for the purpose of indicating such availability, provided
that such signs do not unreasonably interfere with the use
of the Premises by Tenant.

          5.   Rent.

          (a)  Tenant covenants to pay to Landlord, as rent
for the Premises during the Interim Term and the Primary
Term of this Lease, the amounts set forth on Exhibit 5-
1 hereto, and during each Extended Term the amounts
determined pursuant to Exhibit 5-2 hereto (herein
called the "Basic Rent") in monthly installments in
advance on the first day of each calendar month (herein
called the "Basic Rent Payment Dates") by wire or other
electronic transfer of immediately available funds or
by check payable to the Landlord at the address set
forth above and/or to such other person or such other
place or account as Landlord from time to time may
designate to Tenant in writing; provided, Landlord may
designate to Tenant in writing that all or a portion of
the monthly Basic Rent be paid directly to a Mortgagee
or an institutional payment agent, and the remainder be
paid as otherwise designated in writing by Landlord.
Any payment made by check shall be deemed made on the
date received, subject to collection.  Subject to the
second sentence of Subparagraph 7(a), Tenant shall pay
when due all taxes payable on Basic Rent and Additional
Rent, whether imposed on Landlord or Tenant, including
without limitation, all gross rent taxes and sales
taxes on such Basic Rent and Additional Rent, but
calculated as if the Basic Rent and the Additional Rent
were the sole income of Landlord.

          (b)  Tenant covenants that all other amounts,
liabilities and obligations which Tenant assumes or
agrees to pay or discharge pursuant to this Lease
together with every fine, penalty, interest and cost
which may be added for nonpayment or late payment
thereof, shall constitute additional rent hereunder
(herein called "Additional Rent").  In the event of any
failure by Tenant to pay or discharge any Additional
Rent, Landlord shall have all rights, powers and
remedies provided herein or by law in the case of
nonpayment of Basic Rent.  Tenant also covenants to pay
to Landlord on demand an amount (the "Late Charge")
equal to five percent (5%) of the payment amount then
due on all installments of Basic Rent or Additional
Rent which are more than five (5) days overdue, to
cover Landlord's administrative expenses.  Landlord is
obligated to pay any late fees charged by Mortgagee
with respect to the  Mortgage if the Late Charge is
paid by Tenant.  The actual amount of Landlord's
administrative expenses arising by reason of a late
payment will be difficult to ascertain, and the parties
agree that the Late Charge as calculated above is a
reasonable estimate thereof.  In addition, Tenant
further covenants to pay to Landlord on demand interest
at the per annum rate of interest equal to five percent
(5%) plus the "prime rate" as reported by the Wall
Street Journal, or at the maximum rate permitted by
applicable law, whichever is less, on all Basic Rent
and Additional Rent due to Landlord from the date due
until such amount is paid in full.  If the Wall Street
Journal is no longer published or the Wall Street
Journal discontinues publication of the "prime rate,"
then Landlord shall substitute a comparable prime rate.
Notwithstanding the two prior sentences of this
Subparagraph 5(b) to the contrary, so long as any debt
secured by a first Mortgage against the Premises
remains

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outstanding (including such debt as exists on
the date hereof and any such debt incurred in the
future), the rate of interest that shall apply under
this Lease to all overdue Basic Rent and Additional
Rent shall be the lesser of (i) the maximum rate
permitted by applicable law, or (ii) the interest rate
applicable to late payments of interest or principal
due with respect to such debt (which interest rate
under such first Mortgage is referred to herein as the
"Default Rate"); said lower rate described in clauses
(i) or (ii) being referred to as the "Mortgage Default
Rate"; provided, however, such Mortgage Default Rate
shall only apply to the overdue Basic Rent while
Landlord is obligated to pay interest at the Default
Rate on late payments with respect to said Mortgage
debt (and at all other times the rate described in the
prior two sentences of this Subparagraph 5(b) shall
continue to apply to overdue Basic Rent and Additional
Rent).  At the written request of Tenant Landlord will
advise Tenant of the amount of the Mortgage Default
Rate in a Landlord's certificate delivered to Tenant
pursuant to Subparagraph 25(b) hereof.

          6.   Net Lease; Non-Terminability.

          (a)  This is an absolutely net lease to Landlord.
It is the intent of the parties hereto that the Basic Rent
payable under this Lease shall be an absolutely net
return to the Landlord and that the Tenant shall pay
all costs and expense relating to the Premises and the
business carried on therein, unless otherwise expressly
provided to the contrary in this Lease.  Any amount or
obligation relating to the Premises which is not
expressly declared to be that of the Landlord shall be
deemed to be an obligation of the Tenant to be
performed by the Tenant at the Tenant's expense.  Basic
Rent and Additional Rent shall be paid by Tenant
without notice or demand (except as expressly provided
herein), setoff, counterclaim, abatement, suspension,
deduction or defense.

(b)  This Lease shall not terminate, nor shall Tenant
have any right to terminate this Lease (except as
otherwise expressly provided to the contrary in
Paragraphs 15 or 41), nor shall Tenant be entitled to
any abatement of rent, nor shall the obligations of
Tenant under this Lease be affected, by reason of any
of the following:  (i) any damage to or destruction of
all or any part of the Premises from whatever cause
regardless of whether the improvements may be rebuilt
following such damage or destruction to be the same as
they were before such event because of applicable Legal
Requirements or otherwise; (ii) the taking of the
Premises or any portion thereof by condemnation,
eminent domain, requisition or otherwise; (iii) the
prohibition, limitation or restriction of Tenant's use
of all or any part of the Premises, or any interference
with such use; (iv) any eviction by paramount title or
otherwise; (v) Tenant's acquisition or ownership of all
or any part of the Premises, except as expressly
provided herein; (vi) any default on the part of
Landlord under this Lease or under any other agreement
to which Landlord and Tenant may be parties; or
(vii) any other cause whether similar or dissimilar to
the foregoing, any present or future law to the
contrary notwithstanding.  It is the intention of the
parties hereto that the obligations of Tenant hereunder
shall be separate and independent covenants and
agreements, that the Basic Rent and the Additional Rent
shall continue to be payable in all events, and that
the obligations of Tenant hereunder shall continue
unaffected in all events, unless the requirement to pay
or

<PAGE>

perform the same shall have been terminated pursuant
to an express provision of this Lease.  Notwithstanding
anything to the contrary contained above in this
Paragraph 6, Tenant retains a separate and independent
right to sue Landlord or seek equitable remedies
against Landlord with respect to any claim Tenant may
have against Landlord in any way relating to this Lease
or the Premises; provided, however, any judgment, order
or injunctive or equitable relief granted in favor of
Tenant shall not abate, be set off against, reduce or
otherwise affect Tenant's obligation to pay Basic Rent
or Additional Rent or terminate this Lease or reduce or
otherwise affect any of Tenant's obligations hereunder.

          (c)  Tenant agrees that it will remain obligated
under this Lease in accordance with its terms, and that it
will not take any action to terminate, rescind or avoid
this Lease, notwithstanding (i) the bankruptcy,
insolvency, reorganization, composition, readjustment,
liquidation, dissolution, or winding-up or other
proceeding affecting Landlord or its successors in
interest or (ii) any action with respect to this Lease
which may be taken by any trustee or receiver of
Landlord or its successors in interest or by any court
in any such proceeding.

          (d)  Tenant waives all rights which may now or
hereafter be conferred by law (i) to quit, terminate or
surrender this Lease or the Premises or any part
thereof or (ii) to any abatement, suspension, deferment
or reduction of the Basic Rent or Additional Rent.

          7.   Taxes and Assessments; Tax and Insurance Escrow;
Compliance with Law; Environmental Matters.

          (a)  Subject to Paragraph 19 below, Tenant shall pay
or discharge all Impositions, as hereinafter defined, when
due.  Notwithstanding the foregoing provision of this
Subparagraph 7(a), Tenant shall not be required to pay
any franchise, corporate, estate, inheritance,
succession, transfer, net income or excess profits
taxes of Landlord hereunder (other than (i) transfer
and documentary taxes, intangible taxes, recording
fees, or similar charges payable in connection with a
conveyance to Tenant pursuant to this Lease, the
execution of this Lease or the recording of any
memorandum or notice of this Lease, (ii) any taxes on
gross receipts or similar taxes imposed or levied upon,
assessed against or measured by the Basic Rent or
Additional Rent or levied upon or assessed against the
Premises, and (iii) any such tax, assessment, charge or
levy imposed or levied upon or assessed against
Landlord in substitution for or in place of an
Imposition). Tenant agrees to furnish to Landlord,
within thirty (30) days after written request therefor,
evidence of the payment of all Impositions.  Subject to
Paragraph 19 below, Tenant shall pay all real estate
taxes, other ad valorem taxes and special assessments
on the Premises ("Taxes") and charges for utilities
consumed on the Premises which become due during the
Term (even if such Taxes and charges accrued or pertain
to a period prior to the commencement of this Lease)
and also all Taxes which accrue during the Term and
charges which relate to utilities consumed during the
Term.  Taxes shall be prorated at the end of the Term,
and Tenant shall pay its estimated share of unpaid
Taxes which will accrue through the end of the Term
with the last installment of Basic Rent due hereunder
(such share to be reprorated upon issuance of the
actual bill

<PAGE>

therefor). In the event that any special
assessment levied or assessed against the Premises
during the Term hereof may be legally paid in
installments, Tenant shall have the option to pay such
special assessment in installments.  In such event,
Tenant shall be liable only for those installments of
the special assessment, and any accrued interest and
penalties, relating thereto, which become due and
payable prior to the expiration of the Term.

          (b)  Subject to Subparagraph 7(c) below, Tenant
shall make deposits in respect of all Taxes and insurance
premiums for the Required Insurance accruing during the
Term with Landlord (or as Landlord directs in writing
to Tenant) in monthly installments on or before the
first day of each calendar month, in advance, in an
amount estimated by Landlord or the first Mortgagee to
be sufficient to create an available fund to pay such
Taxes and premiums as they become due; provided, if
such installments are required by the first Mortgagee,
Tenant shall pay such installments in the amount
estimated by such Mortgagee to such Mortgagee as
directed by such Mortgagee in writing to Tenant.  Upon
receipt of bills for Taxes and/or insurance premiums
due during a calendar year, Tenant shall submit to
Landlord (and the first Mortgagee if it so requests) a
written statement of the actual amount of the Taxes and
insurance premiums then due and the amount, if any,
theretofore deposited by Tenant in respect thereof.  If
the total amount theretofore deposited by Tenant under
this Subparagraph 7(b) in respect thereto shall be less
than the actual amount due from Tenant for such year,
as shown in such statement, Tenant shall pay to
Landlord (or the first Mortgagee, as applicable) the
shortfall at the time of submission of such statement.
If it appears, in the reasonable judgment of Landlord
or the first Mortgagee, as applicable, that the monthly
deposits made by Tenant have created a reserve in
excess of the amount necessary to pay Taxes and
insurance premiums as they become due, the excess shall
be credited against the next deposit or deposits of
Taxes and insurance premiums due from Tenant hereunder.
All amounts due under this Subparagraph 7(b) shall be
payable to Landlord at the place where the Basic Rent
is payable (or to the first Mortgagee, as provided
above, as applicable) and shall be held for the benefit
of Tenant with either, at the Landlord's option, the
first Mortgagee or a financial institution designated
by Landlord or the first Mortgagee, provided that
following the occurrence of an Event of Default by
Tenant under this Lease, any balance existing in the
account may be applied by Landlord or the first
Mortgagee to any amount then owed by Tenant pursuant to
this Lease, but neither Landlord nor the first
Mortgagee shall be obligated to do so.  Tenant shall
have no authority to direct Landlord or the first
Mortgagee to apply such deposits against any obligation
of Tenant under this Lease, and any such application by
Landlord or the first Mortgagee shall not have the
effect of curing any default.  Said amounts deposited
by Tenant under this Subparagraph 7(b) may be held in
commingled accounts, and no interest shall be payable
thereon, except to the extent otherwise required by
law.  If Landlord receives any interest on any tax or
insurance escrow account held by any Mortgagee, and
such escrow account has been funded by Tenant pursuant
to this Subparagraph 7(b), then Landlord shall remit
such interest to Tenant as received.  A copy of a bill
for Taxes or insurance premiums shall at all times be
sufficient evidence of the amount of Taxes levied,
assessed or imposed against the Premises to which such
bill relates or the amount of insurance premiums for
some or all of the Required Insurance.  Landlord's and

<PAGE>

Tenant's obligations under this Subparagraph 7(b) shall
survive the expiration or early termination of this
Lease.  Provided no Event of Default then exists,
Landlord warrants to Tenant that any balance of funds
remaining on deposit with Landlord or the first
Mortgagee at the expiration of the Term shall be
returned to Tenant by the holder thereof.

          (c)  Notwithstanding Subparagraph 7(b) above,
so long as no Event of Default has ever occurred under
this Lease and so long as Tenant has paid all Taxes on or
before the due date thereof and has at all times
maintained all insurance required under Paragraph 12 of
this Lease, Tenant shall not be required to make
monthly installments toward Taxes and Required
Insurance as provided in Subparagraph 7(b) above,
rather Tenant shall (i) pay all Taxes and premiums for
Required Insurance on or prior to the due date thereof,
and (ii) deliver to Landlord and the first Mortgagee
evidence of payment of such Taxes and insurance within
thirty (30) days following the payment thereof.  If an
Event of Default occurs or if Tenant does not so pay
all Taxes or so maintain all such insurance, then
Landlord or any Mortgagee may at any time thereafter
require Tenant to make monthly installments toward
Taxes and Required Insurance as provided in
Subparagraph 7(b) above by written notice to Tenant,
and Tenant shall commence making such monthly deposits
on the next scheduled rental payment date which occurs
more than ten (10) days following such notice.  Such
notice shall state the amount of the monthly
installments required to be paid by Tenant until
adjustment thereof pursuant to Subparagraph 7(b) above.
The first such monthly installment shall include a
catch-up payment with respect to calendar months in the
applicable tax and insurance fiscal years that have
expired prior the due date of such first monthly
installment.  Further, notwithstanding Subparagraph
7(b) above or this Subparagraph 7(c), Tenant shall not
be required to make monthly deposits for insurance
premiums or provide evidence of payment thereof
pursuant to Subparagraph 7(b) or 12(b) so long as and
to the extent the premiums for Tenant's insurance are
payable on a monthly basis, Tenant makes such monthly
payments when and as due and Tenant otherwise complies
with Subparagraph 12(b).

          (d)  Tenant shall, at its expense, comply with,
cause the Premises to comply with, and cause the use of
the Premises to comply with all Legal Requirements,
including those which require the making of any
structural, unforeseen or extraordinary changes,
whether or not any of the same involve a change of
policy on the part of the body enacting the same,
including but not limited to, the Americans With
Disabilities Act of 1990 (42 U.S.C. Section 12101 et
seq.).  Tenant shall, at its expense, comply with all
changes required in order to obtain the Required
Insurance (as hereinafter defined), and comply with the
provisions of all contracts, agreements, instruments
and restrictions existing at the commencement of this
Lease and included in the Permitted Exceptions or
thereafter created pursuant to the express provisions
of this Lease.  Tenant shall provide Landlord and any
first Mortgagee with prompt notice of any written
complaints pertaining to any alleged violation of any
Legal Requirements and/or the commencement of any
proceedings or investigation (of which Tenant has
knowledge) under any Legal Requirements affecting or
pertaining to the Premises.

<PAGE>

          (e)  Tenant shall:

               (i)  Not cause, suffer or permit any Hazardous
          Material to exist on or discharge from or be released at
          the Premises in violation of Environmental Laws (whether
          originating thereon, brought onto the Premises by third
          parties or migrating to the Premises from other
          property), and shall promptly: (A) remove, remediate
          and dispose of any such Hazardous Material in
          compliance with all Environmental Laws, (B) pay any
          claim against Tenant, any Indemnified Party or the
          Premises arising therefrom, (C) remove any charge or
          lien upon any of the Premises relating thereto, (D)
          defend (with counsel reasonably acceptable to
          Landlord), indemnify and hold harmless Landlord, any
          Mortgagee and their respective officers, directors,
          trustees, members, partners, shareholders,
          beneficiaries, employees and agents (herein
          collectively called "Indemnified Parties" and
          individually an "Indemnified Party") from any and all
          claims, expenses, liability, loss or damage, including
          all reasonable attorneys' fees and expenses, resulting
          from any Hazardous Material that now or hereafter
          exists on or is discharged from or is released at the
          Premises, and (E) prior to the expiration or earlier
          termination of this Lease, remove and dispose of all
          Hazardous Material which then exists on the Premises,
          in compliance with all Environmental Laws.

               (ii) Not cause, suffer or permit any Hazardous
          Material to exist on or discharge from or be released at
          any property owned or used by Tenant which would result in
          any charge or lien upon the Premises and shall
          promptly:  (A) pay any claim against Tenant, any
          Indemnified Party or the Premises arising therefrom,
          (B) remove any charge or lien upon the Premises
          relating thereto, and (C) defend (with counsel
          reasonably acceptable to Landlord), indemnify and hold
          harmless each Indemnified Party from any and all
          claims, expenses, liability, loss or damage (including
          all reasonable attorneys' fees and expenses) resulting
          therefrom.

               (iii) Notify Landlord and any Mortgagee in writing
          of any Hazardous Material (other than Hazardous
          Material stored or transported to or from the Premises
          in the ordinary course of Tenant's or Tenant's
          sublessee's business and in compliance with all
          Environmental Laws) that exists on or is discharged
          from or onto or released at the Premises (whether
          originating thereon, placed therein by third parties or
          migrating to the Premises from other property) within
          ten (10) days after Tenant first has knowledge of such
          existence of discharge.

               (iv) Defend (with counsel reasonably acceptable to
          Landlord), indemnify and hold harmless each Indemnified
          Party from and against any and all claims, expenses,
          liability, loss or damage (including all reasonable
          attorneys' fees and expenses) resulting from the
          failure to comply with Legal

<PAGE>

          Requirements.  Tenant shall give Landlord and each
          Mortgagee prompt notice of (A) any proceeding or inquiry
          of which Tenant becomes aware during the Term by any party
          with respect to the presence of any Hazardous Material on,
          under, from or about the Premises, (B) all claims made or
          threatened by any third party against Tenant or the Premises
          relating to any loss or injury resulting from any
          Hazardous Material of which Tenant becomes aware, and
          (C) Tenant's discovery of any occurrence or condition
          on any real property adjoining or in the vicinity of
          the Premises that Tenant reasonably determines is
          likely to cause the Premises to be subject to any
          investigation or cleanup pursuant to any Environmental
          Law.  Tenant shall permit Landlord and any Mortgagee to
          join and participate in, as a party if it so elects,
          any legal proceedings or action initiated with respect
          to the Premises in connection with any Environmental
          Law or Hazardous Material, and Tenant shall pay all
          attorneys' fees and disbursements incurred by Landlord
          and Mortgagee in connection therewith.

               (v)  Not change its use of the Premises or permit the
          use of the Premises to be changed to any purpose other
          than the use on the date hereof, or change the Tenant's
          business operations conducted at the Premises from that
          conducted on the date hereof, if any such change of use
          or operations would (A) increase the risk of any
          Hazardous Material being released or discharged at or
          from the Premises or otherwise increase the
          environmental risk to the Premises, (B) result in
          Tenant or Landlord being obligated to perform any
          remediation of any Hazardous Material or (C) result in
          the rescinding or modification of any waiver or stand-
          still agreement as to environmental compliance matters
          granted by any governmental agency.

For purposes of this Lease, the following terms shall
have the following meanings:  (1) "Hazardous Material"
means any hazardous or toxic material, substance or
waste which is defined by those or similar terms or is
regulated as such under any Environmental Laws; and
(2) "Environmental Laws" means any statute, law,
ordinance, rule or regulation of any local, county,
state or federal authority having jurisdiction over the
Premises or any portion thereof or its use, which
pertains to environmental, health or safety matters
and/or the regulation of any hazardous or toxic
materials, substance or waste, including but not
limited to:  (a) the Federal Water Pollution Control
Act (33 U.S.C. 1317 et seq.) as amended; (b) the
Federal Resource Conservation and Recovery Act (42
U.S.C. 6901 et seq.) as amended; (c) the Comprehensive
Environmental Response Compensation and Liability Act
(42 U.S.C. 9601 et seq.) as amended; (d) the Toxic
Substance Control Act (15 U.S.C. 2601 et seq.), as
amended; (e) the Clean Air Act (42, U.S. 7401 et
seq.), as amended.  The Tenant's obligations and
liabilities under this Subparagraph 7(e) shall survive
the expiration or earlier termination of this Lease
with respect to any obligation accruing prior to the
end of the Term (or if earlier, the date on which
Landlord actually retakes

<PAGE>

possession of the Premises under clause (ii) of
Subparagraph 20(b)) and any Hazardous Material which
exists or is discharged from or onto or released at the
Premises prior to the end of the Term (or if earlier,
the date on which Landlord actually retakes possession
of the Premises under clause (ii) of Subparagraph 20(b))
of this Lease, and the provisions of this Subparagraph 7(e)
shall be applicable even if a change (or a proposed change)
of use of the Premises after the Term of the Lease gives
rise to such obligation and liability of Tenant.

          (f)  (i) Upon Landlord's or any first Mortgagee's
request, at any time an Event of Default has occurred
and is continuing and at such other times as Landlord
or a first Mortgagee has reasonable grounds to believe
that (A) Hazardous Material has been released, stored
or disposed on or around the Premises (other than as
permitted under this Lease) or (B) the Premises may be
in violation of Environmental Laws, and (ii) not more
than fifteen (15) months and not less than six (6)
months prior to the scheduled expiration of the Term
(as it may be extended), Tenant shall, at Tenant's sole
cost, deliver to Landlord and any first Mortgagee a
current inspection or audit of the Premises prepared by
a hydrogeologist or environmental engineer or other
appropriate consultant approved by Landlord indicating
the presence or absence of Hazardous Material at the
Premises, including the presence or absence of friable
asbestos or substances containing asbestos at the
Premises.  If Tenant fails to provide any required
inspection or audit within thirty (30) days after any
such request or any due date, as the case may be,
Landlord may order same, in which event (1) Tenant
shall reimburse Landlord upon demand for the cost
thereof, and (2) Landlord, any first Mortgagee and such
hydrogeologists, engineers and/or consultants shall
have the right to come onto the Premises to perform
such inspection and/or audit.  Tenant shall promptly
deliver to Landlord copies of all monitoring results
and environmental inspections and reports which Tenant
performs or receives with respect to Hazardous Material
at the Premises.  The obligations of Tenant under this
Subparagraph 7(f) shall survive the expiration or
earlier termination of this Lease.

          8.   Indemnification.

          (a)  Tenant agrees to pay, and to protect, defend
(with counsel reasonably acceptable to Landlord), indemnify
and hold harmless Landlord and the other Indemnified
Parties from and against any and all liabilities,
losses, damages, costs, expenses (including all
reasonable attorneys' fees and expenses), causes of
action, suits, claims, demands or judgments of any
nature (herein collectively called "Damages")
whatsoever arising from (i) any use, condition or event
occurring on the Premises prior to or during the Term
(including without limitation, the construction or
existence of any Alterations), (ii) any injury to, or
the death of, any person or damage to property on the
Premises prior to or during the Term, (iii) any injury
to, or the death of, any person or damage to property
upon adjoining sidewalks, streets or rights of way or
in any manner growing out of or connected with the use,
non-use, condition or occupation of the Premises,
adjoining sidewalks, streets or rights of way prior to
or during the Term, (iv) any violation by Tenant of any
agreement or condition of this Lease, or any contract
or agreement to which Tenant is a party or which
pertains to the Premises or any part thereof or the
ownership, occupancy or use thereof, and (v) any
violation by Tenant of any Legal Requirement; provided,
however, the foregoing indemnity shall not apply as to
an Indemnified Party with respect to claims arising
solely

<PAGE>

from the affirmative negligent acts or willful
misconduct of such Indemnified Party.  If an
Indemnified Party shall be made a party to any such
litigation commenced against Tenant, Tenant shall, at
its option, either defend, at Tenant's sole cost and
expense, such Indemnified Party with counsel reasonably
acceptable to such Indemnified Party or pay all costs
and reasonable attorneys' fees and expenses incurred or
paid by such Indemnified Party in connection with such
litigation.  In the event Tenant shall, pursuant to
this Paragraph 8, discharge any claim against an
Indemnified Party, Tenant shall be subrogated to the
rights of the Indemnified Party with respect thereto,
except that in no event shall Tenant be thereby
subrogated to a claim against another Indemnified
Party.

          (b)  Tenant shall indemnify each Indemnified Party
with respect to any loss or damage suffered by Landlord or
such other Indemnified Party by reason of any material
inaccuracy or misstatement in any representation or
warranty of Tenant set forth in this Lease or in any
document, notice, certificate, demand or request
delivered to any Indemnified Party pursuant to this
Lease.

          (c)  The Tenant's obligations and liabilities under
this Paragraph 8 shall survive expiration or earlier
termination of this Lease.

          9.   Liens.

          Tenant will not, directly or indirectly,
create or permit to be created and to remain for more
than thirty (30) days after the creation thereof, and
will, subject to Paragraph 19 below, promptly discharge
(or bond over, if the legal effect of bonding over will
act as a discharge), at its expense, within thirty (30)
days after the creation thereof, any mortgage, lien,
encumbrance or charge on, pledge of, or conditional
sale or other title retention agreement with respect
to, the Premises or any part thereof or Tenant's
interest therein or the Basic Rent, Additional Rent or
other sums payable by Tenant under this Lease, other
than any Mortgage or other encumbrance created by
Landlord or the Permitted Exceptions.  Nothing
contained in this Lease shall be construed as
constituting the consent or request, expressed or
implied, by Landlord to or for the performance of any
labor or services or of the furnishing of any materials
for any construction, alteration, addition, repair or
demolition of or to the Premises or any part thereof by
any contractor, subcontractor, laborer, materialman or
vendor.  Notice is hereby given that Landlord will not
be liable for any labor, services or materials
furnished or to be furnished to Tenant, or to anyone
holding the Premises or any part thereof, and that no
mechanic's, construction or other liens for any such
labor, services or materials shall attach to or affect
the interest of Landlord in and to the Premises.

          10.  Maintenance and Repair.

          (a)  Tenant acknowledges that, with full awareness
of its obligations under this Lease, Tenant has accepted
the condition, state of repair and appearance of the
Premises.  Tenant agrees that, at its expense, it shall
put, keep and maintain the Premises, including any
altered, rebuilt, additional or substituted buildings,
structures and other improvements thereto or thereon,
in safe condition, repair and appearance in a manner
comparable with the

<PAGE>

condition of the Premises at the commencement of the Term
of this Lease, reasonable wear and tear excepted, but in no
event shall the standard of maintenance and repair be less
than the standards of maintenance and repair at other facilities
of a similar nature owned or operated by Tenant or any Affiliate
of Tenant.  Tenant shall make all repairs and replacements
necessary to fulfill the foregoing maintenance and
repair standards.  Without limiting the foregoing,
Tenant shall promptly make all structural and
nonstructural, foreseen and unforeseen, ordinary and
extraordinary changes, replacements and repairs of
every kind and nature, and correct any patent or latent
defects in the Premises, which may be required to put,
keep and maintain the Premises in the aforesaid
condition, repair and appearance.  Tenant will keep the
Premises orderly and free and clear of rubbish.  Tenant
covenants to perform or observe all terms, covenants
and conditions of any easement, restriction, covenant,
declaration and maintenance agreement (collectively,
"Easements") to which it may at any time be a party or
to which the Premises are currently subject or become
subject pursuant to this Lease (including Tenant
Easements and Landlord Easements) whether or not such
performance is required of Landlord under such
Easements, including without limitation, payment of all
amounts due from Landlord or Tenant (whether as
assessments, service fees or other charges) under such
Easements.  Tenant shall, at its expense, use
reasonable efforts to enforce compliance with any
Easements benefiting the Premises by any other person
or entity or property subject to such Easement.
Landlord shall not be required to maintain, repair or
rebuild, or to make any alterations, replacements or
renewals of any nature to the Premises, or any part
thereof, whether ordinary or extraordinary, structural
or nonstructural, foreseen or not foreseen, or to
maintain the Premises or any part thereof in any way or
to correct any patent or latent defect therein.  Tenant
hereby expressly waives any right to make repairs at
the expense of Landlord which may be provided for in
any law in effect at the time of the commencement of
the Term or which may thereafter be enacted.  If Tenant
shall vacate or abandon the Premises, it shall give
Landlord and any Mortgagee immediate notice thereof.

          (b)  Subject to Paragraph 19 below, if any
Improvements situated on the Premises at any time during
the Term shall encroach upon any property, street or right
of way adjoining or adjacent to the Premises, shall
violate any Legal Requirement or shall impair the
rights of others under or hinder or obstruct any
Easement or right of way to which the Premises is
subject, then, promptly after the written request of
any applicable governmental authority, Landlord or any
other person or entity affected by any such
encroachment, violation, impairment, hindrance or
obstruction (which other person or entity may be
Landlord with respect to any such encroachment,
violation or impairment which first arises after the
date of this Lease), Tenant shall, at its expense,
either (i) obtain legally effective variances of such
legal requirements or waivers or settlements of all
claims, liabilities and damages resulting from each
such encroachment, violation, impairment, hindrance or
obstruction whether the same shall affect Landlord,
Tenant or both, or (ii) make such changes in the
Improvements on the Premises and take such other action
as shall be necessary to remove such encroachments,
hindrances or obstructions and to end such violations
or impairments, including, if necessary, the alteration
or removal of any

<PAGE>

Improvement on the Premises; provided, however, Tenant shall
do so only (1) in a manner that does not lessen the market value
of the Premises and (2) in conformity with the requirements of
Paragraph 11 to the same extent as if such alteration
or removal were an alteration subject to the provisions
of Paragraph 11.

          (c)  Landlord, any Mortgagee and their respective
agents and designees may enter upon and inspect the
Premises at reasonable times and on reasonable prior
notice and show the Premises to prospective Mortgagees
and/or purchasers.  Tenant may designate an employee to
accompany Landlord, any Mortgagee and their respective
agents and designees on such examinations.  Tenant will
provide, upon Landlord's request, records for the prior
twelve (12) months with respect to operating expenses
(such as utility costs and maintenance expenses) of the
Premises and for the prior five (5) years (to the
extent reasonably available to Tenant) with respect to
repair and replacement of structural elements, roof and
mechanical systems in the Premises, provided, except as
may be explicitly required elsewhere in this Lease,
Tenant shall have no obligation to disclose records
relating solely to the operation of Tenant's business
as opposed to the operation, repair or replacement of
the Premises.  All such information will be certified
as true, complete and correct to the best of Tenant's
knowledge.

          11.  Alterations.

          Tenant shall not make or suffer to be made
any alterations, additions or improvements in, on or to
the Premises or any part thereof which would
(i) materially reduce the value of the Premises to a
third party user for any legally permitted use,
(ii) create or increase the likelihood of a hazardous
or illegal condition, (iii) together with any other
related Alterations or series of related Alterations,
cost in excess of One Hundred Thousand Dollars
($100,000) in any twelve (12) month period, (iv) alter
the footprint of the Improvements or the structural
components of the Improvements, (v) increase the risk
of any Hazardous Material being released or discharged
at or from the Premises or otherwise increase any
environmental risk to the Premises, (vi) result in
Tenant or Landlord being obligated to perform any
remediation of any Hazardous Material, or (vii) result
in the rescinding or modification of any waiver or
stand-still agreement as to environmental compliance
matters, zoning or any other Legal Requirements granted
by any governmental agency without, in each case, the
prior written consent of Landlord and any Mortgagee
(any such alterations, additions or improvements
described in any of clauses (i) through (vii) being
referred to as "Alterations").  Without limitation of
Landlord's right to withhold its consent to such
Alterations (A) Landlord may withhold its consent if an
Event of Default then exists and (B) any consent to the
making of Alterations may be conditioned on the
requirement that Tenant remove any such Alterations at
the end of the Term (as it may be extended) and put the
Premises back into its former condition, and repair any
damage to the Premises caused thereby.  If Landlord's
consent to Alterations is required under this Paragraph
11, Tenant shall not commence the work until and unless
Landlord and any Mortgagee shall have approved plans
and specifications for such Alterations, which approval
shall not be unreasonably withheld or delayed.  In the
event Tenant makes any changes in or to any mechanical
component of the Premises (for example, a portion

<PAGE>

of the HVAC system), Tenant shall replace the same with
new mechanicals of equal or greater value and utility.
In the event Tenant makes any Alterations of the
Premises in connection with the use of the Premises (or
a portion thereof) for any permitted purpose which is
materially different from Tenant's use upon the
commencement of this Lease, then upon Landlord's
request at the end of the Term (as it may be extended),
Tenant shall remove any such Alterations and put the
Premises back into its former condition suitable for
the use permitted on the date hereof under Paragraph 3,
and repair any damage to the Premises caused thereby;
provided, however, if Tenant provides Landlord with
reasonable prior notice of such Alterations (including
all information and drawings pertaining thereto as
Landlord may reasonably request), and Tenant expressly
requests in such notice that Landlord do so, then
Landlord shall, within ten (10) business days after
receipt of such notice (and related information and
drawings), give Tenant notice as to whether or not
Landlord will require Tenant to remove any such
Alterations at the end of the Term and repair any
damage caused thereby.  Minor decorations to the
Premises, such as painting and wallpapering, shall not
constitute Alterations for purposes of this Lease.  All
Alterations shall be constructed in a good and
workmanlike manner in compliance with all Legal
Requirements.  Tenant shall satisfy the following
conditions in connection with all Alterations:

          (1)  Tenant shall pay or cause to be paid the entire
     cost of such Alterations;

          (2)  Tenant shall take all necessary steps to prevent
     the imposition of liens against the Premises as a
     result of such Alterations;

          (3)  Tenant shall obtain and pay for all necessary
     permits and shall comply with all applicable
     governmental requirements;

          (4)  Tenant shall cause the construction of
     Alterations, once commenced, to be diligently pursued
     to completion;

          (5)  If the Alterations include any changes or new
     matter which would be shown on an updated ALTA/ACSM
     Class A Urban survey of the Premises (including Table A
     and other items customarily required by institutional
     lenders), then Tenant shall obtain and submit to
     Landlord and Mortgagee, promptly following substantial
     completion of the Alterations, a revised ALTA/ACSM
     Class A Urban survey of the Premises certified, and in
     a form reasonably satisfactory, to Landlord and
     Mortgagee;

          (6)  Tenant shall provide Landlord with "as built"
     plans for all Alterations promptly following
     substantial completion of the Alterations; and

          (7)  If the Alterations, together with any other
     related Alterations or series of related Alterations
     are reasonably expected to cost in excess of One
     Hundred Thousand Dollars ($100,000) in the aggregate,
     (i) Tenant shall provide a construction budget showing
     all "hard" and "soft" costs to be incurred in
     connection with all such Alterations, plus a reasonable
     contingency (the "Alterations Budget"), together with
     evidence reasonably acceptable to the Landlord and any
     Mortgagee supporting the

<PAGE>

     total costs reflected in the Alterations Budget, which may
     include, among other things, one or more fixed price or
     guaranteed maximum price contract(s), completion and labor
     and materials bonds and costs analyses by reputable architects
     and engineers, and (ii) Tenant shall demonstrate to the
     reasonable satisfaction of the Landlord and any first
     Mortgagee the availability of liquid funds in an amount
     sufficient to complete such Alterations and pay all
     costs and expenses in connection therewith, which may
     be in the form of:

          (A)  a segregated bank account, containing an amount at
               least equal to the total costs (including contingency)
               shown in the Alterations Budget, at a bank whose
               financial condition is reasonably acceptable to
               Landlord and any first Mortgagee, which account shall
               be pledged, (including subordination of such bank's
               rights of setoff with respect to such account) to
               Landlord and its first Mortgagee as security for the
               performance by Tenant of its obligation to complete and
               pay for such Alterations (it being agreed that the
               funds in any such account shall be available for
               application by Tenant to the costs of the Alterations
               as such costs are incurred, subject to receipt of
               customary evidence of completion of the work for which
               payment is being made, receipt of appropriate lien
               waivers, and the sufficiency of the funds remaining in
               the account to complete the Alterations); or

          (B)  an irrevocable letter of credit, in an amount at
               least equal to the total costs (including contingency)
               shown in the Alterations Budget, from a bank or other
               financial institution regularly in the business of
               issuing letters of credit and whose financial condition
               is reasonably acceptable to Landlord and any first
               Mortgagee, which letter of credit shall be for a term
               and otherwise in form and content reasonably acceptable
               to Landlord and any first Mortgagee and which shall
               secure the performance by Tenant of its obligation to
               complete and pay for such Alterations (it being agreed
               that the amount of such letter of credit may be reduced
               as costs of the Alterations are paid, subject to
               receipt of customary evidence of completion of the work
               for which payment has been made, receipt of appropriate
               lien waivers, and the sufficiency of the remaining
               balance of the letter of credit to complete the
               Alterations); or

          (C)  subject to the further provisions of the last
               grammatical paragraph of this Paragraph 11, a loan, in
               an amount at least equal to the total costs (including
               contingency) shown in the Alterations Budget, from a
               bank or other financial institution regularly in the
               business of making loans for construction, alterations,
               or improvements to commercial or industrial properties
               and whose financial condition is reasonably acceptable
               to Landlord and any first Mortgagee, with such loan to be

<PAGE>

               evidenced by legally binding loan documents executed
               by Tenant and such lender that provide for disbursement
               of the necessary funds on a regular basis as required
               for payment of such costs subject only conditions
               customary for such loans and that are otherwise in a
               form customary for such loans; or

          (D)  any combination of the facilities described in
               clauses (A), (B) and/or (C) above.

For purposes of this Paragraph 11, the financial
condition of a bank or other financial institution
shall be reasonably acceptable if it meets guidelines
published from time to time by Standard & Poors or
another nationally recognized credit rating agency for
holders of deposits in connection with issues of rated
debt instruments.  In addition, any such bank or
financial institution shall have its principal offices
in the continental United States or shall have
substantial branch operations and substantial assets in
the continental United States.

          Notwithstanding anything to the contrary
stated in this Paragraph 11, in the event Tenant is
required to make Alterations to the Premises in order
to comply with any Legal Requirements, Tenant may make
or cause to be made such Alterations without the prior
written consent of (but upon the prior notification to)
Landlord and Mortgagee.  Tenant shall (to the maximum
extent possible in compliance with all Legal
Requirements) satisfy the conditions specified in
clauses (1) through (7) of this Paragraph 11 with
respect to such Alterations and Tenant shall make or
cause to make such Alterations in the manner which will
have the least negative impact on the market value of
the Premises.

          Except for Severable Additions, all
Alterations shall at once become a part of the realty
and belong to Landlord.  Severable Additions, movable
furniture, furnishings, shelving, racking, tow motor
electric charging stations, decorations, trade fixtures
and other personal property of Tenant and its
sublessees may be removed from the Premises at any time
prior to the expiration or earlier termination of this
Lease, provided that Tenant shall repair any damage to
the Premises resulting from such removal and provided
further that Landlord shall have the right to purchase
any or all Severable Additions for fair market value at
the end of the Term.  Tenant shall give Landlord
reasonable advance notice prior to removing any
Severable Additions.  For purposes of this Lease, the
term "Severable Additions" shall mean all additions to
the Premises during the Term (but not including movable
furniture, furnishings, shelving, racking, tow motor
electric charging stations, decorations, trade fixtures
and other personal property of Tenant and its
sublessees) which (1) are readily removable without
causing more than de minimus damage after Tenant
repairs to the Premises, (2) will not reduce the value,
useful life or utility of the Premises if removed,
(3) are not required for lawful use of the Premises and
(4) have been paid for by Tenant.  The obligations of
Tenant under this Paragraph 11 shall survive expiration
or earlier termination of this Lease.  Tenant shall
promptly upon request therefor reimburse Landlord and
any Mortgagee the amount of all reasonable fees and
expenses incurred by them (including without limitation
reasonable attorneys' fees and expenses and reasonable
architects' and engineers' fees and expenses) in
connection with any

<PAGE>

requests by Tenant to perform Alterations, review any plans
and specifications and/or budgets with respect thereto, the
performance of any Alterations and any other matters addressed
in this Paragraph 11.

          12.  Insurance.

          (a)  Tenant shall maintain, or cause to be maintained,
at its sole expense, the following insurance on the
Premises (herein called the "Required Insurance"):

               (i)  Property insurance ("Property Insurance") insuring
          the Improvements for all risks of direct physical loss
          and for perils covered by the causes of loss-special
          form (all risk, extended coverage) and in addition,
          ordinance or law coverage and boiler and machinery
          coverage (if applicable).  Such insurance shall be
          written on a replacement cost basis with an agreed
          value equal to the full insurable replacement value of
          the Improvements.  The policy shall name Landlord and
          any first Mortgagee as insureds and loss payees.  Not
          more frequently than every year, if in the reasonable
          opinion of the Landlord the amount of the Tenant's
          property insurance is found to be inadequate, the
          Tenant will increase the insurance amount as required
          by the Landlord.  If the first Mortgagee requires an
          appraisal to be performed for purposes of determining
          the sufficiency of insurance coverage, Tenant shall pay
          the costs of the appraisal and updates hereof.
          However, Tenant will not be required to update the
          appraisal more often than once every five (5) years
          unless Alterations have occurred to the Premises or
          there has been a material change of the use of the
          Premises.

               (ii) Commercial general liability insurance naming the
          Landlord (and each of its shareholders, members,
          partners and beneficiaries, as applicable) and any
          Mortgagee as additional insureds against any and all
          claims as are customarily covered under a standard
          policy form routinely accepted, for bodily injury,
          death and property damage occurring in or about the
          Premises and on adjoining streets and sidewalks.  Such
          insurance shall have a combined single limit of not
          less than One Million Dollars ($1,000,000) per
          occurrence with a minimum One Million Dollar
          ($1,000,000) aggregate limit and excess umbrella
          liability insurance in the amount of at least Twenty-
          Five Million Dollars ($25,000,000).  If Tenant has
          other locations that it owns or leases, the liability
          insurance required by this clause (ii) may be a so-
          called blanket policy provided the blanket policy
          either (A) includes a Twenty-Five Million Dollar
          ($25,0000,000) aggregate limit per location
          endorsement, or (B) provides a minimum of Twenty-Five
          Million Dollars ($25,000,000) of combined bodily injury
          and property damage coverage for each occurrence with a
          combined aggregate limit of Twenty-Five Million Dollars
          ($25,000,000).  Tenant shall be required to increase
          its insurance limits from time to time consistent with
          coverage on properties similarly constructed, occupied
          and maintained.  Such liability insurance shall be
          primary and not contributing to any insurance available
          to Landlord and Landlord's insurance, if any, shall be in

<PAGE>

          excess thereto.  In no event shall the limits of
          such insurance be considered as limiting the liability
          of Tenant under this Lease.

               (iii) Workers' compensation insurance in accordance
          with statutory law and employers' liability insurance
          with a limit of not less than One Hundred Thousand
          Dollars ($100,000) per employee and Five Hundred
          Thousand Dollars ($500,000) per occurrence.

               (iv) During any period of construction on the Premises,
          builder's risk insurance insuring perils covered by the
          loss-special form (all risk, extended coverage) shall
          be purchased for the value of the alteration and/or
          additions made to the Premises when the work is not
          insured under the Tenant's property insurance policy.
          Each builder's visa policy shall name Landlord and any
          first Mortgagee as insureds and loss payees.

               (v)  Flood insurance in the highest available amount
          under the National Flood Insurance Program if the
          Premises are located in a special flood hazard zone.
          If the Premises are not located in a special flood
          hazard zone, the Property Insurance shall include flood
          coverage for the Premises in the amount of Five Hundred
          Thousand Dollars ($500,000) or more.  Each flood
          insurance policy shall name Landlord and any first
          Mortgagee as insureds and loss payees.

               (vi) If the Premises are located in an earthquake zone,
          earthquake insurance in amounts sufficient to prevent
          Landlord and Tenant from becoming a coinsurer of any
          loss but in any event in amounts equal to 100% of the
          actual replacement value of the Improvements including
          foundations and excavations, with a prudent deductible
          considering the gross insurance coverage, the cost of
          the insurance and the financial strength of the Tenant,
          the amount of such deductible to be reasonably
          acceptable to Landlord (it being agreed that as of the
          date of this Lease, One Hundred Thousand Dollars
          ($100,000) is a prudent deductible) and with a
          replacement cost endorsement.  If the Premises are not
          located in an earthquake zone, the Property Insurance
          shall include earthquake insurance for the Premises in
          the amount of One Million Dollars ($1,000,000) or more.
          Each earthquake policy shall name Landlord and any
          first Mortgagee as insureds and loss payees.

               (vii) (A) Business interruption insurance in an
          amount sufficient to pay Basic Rent and all Additional
          Rent for a twelve month period, and (B) such other
          insurance as Landlord may, from time to time,
          reasonably require, or which may, from time to time, be
          required by Landlord so long as such other insurance is
          customarily required to be carried on similar
          properties by institutional landlords or mortgagees in
          the industry.

          (b)  The policies required to be maintained by Tenant
shall conform to S & P and Moody's securitization
guidelines and shall be with companies having (i) an
insurance company claims paying rating equal to or
greater than A by Standard & Poors Corporation or A2 by
Moody's Investment Service or be considered equivalent
to an NAIC 1

<PAGE>

or other acceptable rating acceptable to
the Securities Valuation Office of the National
Association of Insurance Commissioners, and (ii) a
general policy rating of A or better and a financial
class of XI or better by A.M. Best Company, Inc.
Insurers shall be licensed to do business in the state
in which the Premises are located and domiciled in the
USA.  Except as may be otherwise specified in
Subparagraph 12(a), any deductible amounts under any
insurance policies required hereunder shall not exceed
Fifty Thousand Dollars ($50,000), provided the
deductible limit shall not apply to worker's
compensation so long as Tenant provides Landlord with
evidence from time to time of (A) Tenant's self-
insurance bond for worker's compensation coverage, and
(B) specific excess and aggregate excess worker's
compensation coverage up to statutory limits if in
excess of Tenant's retained liability.  Certificates of
insurance (as to property insurance, using Accord Form
No. 27 (or the equivalent thereof), and as to liability
insurance, using Accord Form 25-S (or the equivalent
thereof)), together with reasonable evidence of payment
of the premiums therefor, shall be delivered to
Landlord and each Mortgagee prior to the commencement
date of this Lease and thereafter at least thirty (30)
days prior to the expiration date of each required
policy; provided, however, at the request of a first
Mortgagee, not less than thirty (30) days prior to the
expiration dates of the foregoing insurance policies,
Tenant shall provide copies of replacement policies
therefor to both Landlord and the first Mortgagee,
together with evidence reasonably satisfactory to
Landlord and Mortgagee of payment of the premiums for
such policies (subject to Subparagraph 7(b) above);
provided, however, in the case of renewals, Tenant may
provide Landlord and Mortgagee with binders therefor to
be followed by the original policies when issued.
Tenant shall have the right to provide insurance
coverage which it is obligated to carry pursuant to the
terms hereof in a blanket policy, provided such blanket
policy expressly affords coverage to the Premises and
to Landlord and any Mortgagee as required by this
Lease.  Each policy of insurance shall provide
notification to Landlord and any first Mortgagee at
least thirty (30) days prior to any non-renewal,
cancellation or modification to reduce the insurance
coverage.

          (c)  (i)  Insurance claims by reason of damage to or
     destruction of any portion of the Premises shall be
     adjusted by Tenant if an Event of Default does not then
     exist and the reasonable estimate of the cost to repair
     the damage does not exceed Two Hundred Fifty Thousand
     Dollars ($250,000), or by Landlord if an Event of
     Default then exists or if the reasonable estimate of
     the cost to repair the damage exceeds Two Hundred Fifty
     Thousand Dollars ($250,000).  Tenant shall, promptly
     after any damage or destruction to the Premises, advise
     Landlord and any first Mortgagee of such occurrence and
     consult with Landlord and any first Mortgagee
     throughout the process of adjusting any such claim.
     Landlord shall not be required to prosecute any claim
     against, or to contest any settlement proposed by, an
     insurer.  Tenant may, at its expense, prosecute any
     such claim or contest any such settlement in the name
     of Landlord, Tenant or both, and Landlord will join
     therein at Tenant's written request upon the receipt by
     Landlord of an indemnity from Tenant against all costs,
     liabilities and expenses in connection therewith.

<PAGE>

               (ii) Subject to the provisions of Paragraph 13,
          proceeds from the property insurance policy, net of
          Tenant's, and, if applicable, Landlord's and
          Mortgagee's expenses incurred in adjusting and
          collecting such proceeds (such net amount being the
          "Net Insurance Proceeds") shall be made available from
          Landlord or Mortgagee to Tenant, but only upon
          submission to Landlord and any Mortgagee (A) prior to
          commencement of work, of plans and specifications
          covering all repair and restoration work in form and
          substance acceptable to Landlord and Mortgagee, and (B)
          prior to each periodic disbursement:  (1) reasonable
          evidence that the remaining unapplied proceeds of the
          insurance will be sufficient to pay the remaining cost
          of the reconstruction or repair and provide a
          reasonable reserve for contingencies, (2) certificates
          of Tenant delivered to Landlord from time to time as
          such work or repair progresses, each such certificate
          describing the work or repair for which Tenant is
          requesting payment and the cost incurred by Tenant in
          connection therewith and stating that Tenant has not
          theretofore received payment for such work and has
          sufficient funds remaining to complete the work free of
          liens or claims, (3) owner's and contractor's sworn
          statements in customary form and appropriate waivers of
          mechanic's or construction liens, (4) architect's
          certificates in customary form covering the work for
          which payment is requested, and (5) such other
          requirements as may be imposed by any Mortgagee.
          Subject to the provisions of Paragraph 13, any proceeds
          remaining after Tenant has repaired the Premises
          pursuant to Paragraph 13 shall be delivered to Tenant.
          No proceeds shall be made available to Tenant pursuant
          to this Subparagraph 12(c) if any default then exists
          in the performance by Tenant of its obligations under
          this Lease.

          (d)  In the event Tenant does not purchase the
insurance required by this Lease or keep the same in
full force and effect, Landlord may, but shall not be
obligated to, purchase the necessary insurance and pay
the premium therefor.  The Tenant shall repay to
Landlord, as Additional Rent, the amount so paid
promptly upon demand together with interest at the
Default Rate on such payment from the date expended
until the date reimbursed.  In addition, Landlord may
recover from Tenant and Tenant agrees to pay, as
Additional Rent, any and all expenses (including
reasonable attorneys' fees) and damages which Landlord
may sustain by reason of the failure of Tenant to
obtain and maintain such insurance.

          (e)  Landlord shall not be limited in the proof of any
damages which Landlord may claim against Tenant arising
out of or by reason of Tenant's failure to provide and
keep in force any of the Required Insurance to the
amount of the insurance premium or premiums not paid or
incurred by Tenant and which would have been payable
under such insurance; but Landlord shall also be
entitled to recover as damages for such breach, the
uninsured amount of any loss to the extent of any
deficiency in the Required Insurance, and damages,
costs and expenses of suit suffered or incurred by
reason of or damage to, or destruction of the Premises,
occurring during any period when the Tenant may have
failed or

<PAGE>

neglected to obtain the Required Insurance.
Tenant shall indemnify and hold harmless Landlord and
any Mortgagee for any liability incurred by Landlord or
any Mortgagee arising out of any deductibles for
Required Insurance.

          (f)  All policies of insurance required under this
Paragraph 12 (except, workers' compensation insurance)
shall contain clauses or endorsements to the effect that:

               (i)  no act or negligence of Landlord, or anyone acting
          for Landlord or of Tenant or any sublessee or other
          occupant of the Premises, or failure to comply with the
          provisions of any policy which might otherwise result
          in a forfeiture of the insurance or any part thereof,
          shall in any way affect the validity or enforceability
          of the insurance insofar as Landlord and any Mortgagee
          is concerned; and

               (ii) Neither Landlord nor any Mortgagee shall be liable
          for any insurance premiums thereon or subject to any
          assessments thereunder.

          13.  Casualty.

          (a)  If a part of the Premises shall be damaged or
destroyed by casualty ("Casualty"), and if the
estimated cost of rebuilding, replacing and repairing
the same shall be or exceed One Hundred Thousand
Dollars ($100,000), (i) Tenant shall promptly notify
Landlord and Mortgagee thereof; and (whether or not
such estimated cost shall be or exceed One Hundred
Thousand Dollars ($100,000) and whether or not
insurance proceeds are or will ever be available
therefor) Tenant shall, with reasonable promptness and
diligence, rebuild, replace and repair any damage or
destruction to the Premises, at its expense, in
conformity with the requirements of Paragraph 11 (as if
such work were Alterations) in such manner as to
restore the same to the same or better condition and
equivalent or better value, as nearly as possible, as
existed immediately prior to such casualty and
(ii) there shall be no abatement of Basic Rent or
Additional Rent.

          (b)  Notwithstanding anything in this Paragraph 13
to the contrary, during any period of time when there
continues to exist an Event of Default, Landlord, in
the exercise of its sole and absolute discretion, shall
have the right, without limiting Tenant's obligations
under Subparagraph 13(a), to receive and retain any
insurance proceeds from any Casualty and to apply the
same to any amounts due under this Lease in any manner
as Landlord, in its sole discretion, may determine,
instead of making such proceeds available to Tenant for
the rebuilding or restoration of the damaged portion of
the Premises.

          14.  Condemnation.

          (a)  Subject to the rights of Tenant set forth in this
Paragraph 14 and in Subparagraph 15(b), Tenant hereby
irrevocably assigns to Landlord any award or payment to
which Tenant may be or become entitled with respect to
the taking of the Premises or any part thereof, by
condemnation or other eminent domain proceedings
pursuant to any law,

<PAGE>

general or special, or by reason of the temporary taking of
any interest in or the use or occupancy of the Premises or any
part thereof, by any governmental authority, civil or military,
whether the same shall be paid or payable in respect of
Tenant's leasehold interest hereunder or otherwise;
provided, however, the foregoing assignment shall not
apply to any separate award which Tenant may be
entitled to claim against the condemnor with respect to
Tenant's relocation expenses or with respect to the
value of Tenant's personal property, so long as such
separate award does not reduce the Net Award to which
Landlord is otherwise entitled.  Landlord, Tenant and
any first Mortgagee shall be entitled to participate in
any such proceeding and the expenses of Landlord,
Tenant and Mortgagee (including reasonable counsel fees
and expenses) shall be paid by Tenant.

          (b)  For purposes of this Lease, (i) "Condemnation"
shall mean a governmental taking of all or any material
portion of the Premises; and (ii) a "Material Temporary
Taking" shall mean a temporary governmental taking of
all or any material part of the Premises for a period
in excess of twelve (12) months or a period extending
beyond the end of the Primary Term.  If during the Term
(A) a portion of the Premises shall be taken by
condemnation or other eminent domain proceedings which
taking does not result in a termination of this Lease
pursuant to Paragraph 15 or (B) the use or occupancy of
the Premises or any part thereof shall be temporarily
taken by any governmental authority and such temporary
taking does not result in a termination of this Lease
pursuant to Paragraph 15 (a taking described in clause
(A) or (B) being a "Non-Termination Taking"), then this
Lease shall continue in full force and effect without
abatement or reduction of Basic Rent or Additional Rent
notwithstanding such taking.  Tenant shall, promptly
after any Non-Termination (including after the
cessation of any temporary taking), at its expense,
repair any damage caused thereby in conformity with the
requirements of Paragraph 11 (as if such work were
Alterations) so that, thereafter, the Premises shall
be, as nearly as possible, in a condition as good as
the condition thereof immediately prior to such taking.
In the event of any Non-Termination Taking, Landlord
shall make the Net Award available to Tenant to make
such repair; however, if such Net Award shall be in
excess of Two Hundred Fifty Thousand Dollars
($250,000), Landlord shall make the Net Award available
to Tenant only upon submission to Landlord and any
Mortgagee (A) prior to commencement of work, plans and
specifications covering all repair work in form and
substance acceptable to Landlord and Mortgagee, and (B)
prior to each periodic disbursement:  (1) reasonable
evidence that the remaining unapplied Net Award will be
sufficient to pay the remaining unpaid cost of the
repair and provide a reasonable contingency reserve,
(2) certificates of Tenant delivered to Landlord from
time to time as such work or repair progresses, each
such certificate describing the work or repair for
which Tenant is requesting payment and the cost
incurred by Tenant in connection therewith and stating
that Tenant has not theretofore received payment for
such work, (3) owner's and contractor's sworn
statements in customary form and appropriate waivers of
mechanic's or construction liens, (4) architect's
certificates in customary form covering the work for
which payment is requested, and (5) such other
requirements as may be imposed by any Mortgagee.  Any
Net Award remaining after such repairs have been made,
shall be delivered to Landlord, except that in the
event of any

<PAGE>

temporary Non-Termination Taking, Tenant
shall be entitled to receive the entire Net Award so
remaining, less any costs incurred by Landlord or
Mortgagee in connection therewith.  If the cost of any
repairs required to be made by Tenant pursuant to this
Subparagraph 14(b) shall exceed the amount of the Net
Award, the deficiency shall be paid by Tenant.
Notwithstanding anything herein to the contrary, no
payments shall be made to Tenant pursuant to this
Subparagraph 14(b) if any Event of Default then exists.

          (c)  Notwithstanding anything in this Paragraph 14
to the contrary, during any period of time when there
continues to exist an Event of Default, Landlord, in
the exercise of its sole and absolute discretion, shall
have the right, without limiting Tenant's obligations
under Subparagraphs 14(a) and (b), to receive and
retain the entire award payable with respect to any
Condemnation and to apply the same to any amount due
under this Lease in any manner as Landlord, in its sole
discretion, may determine, instead of making such award
available to Tenant for the rebuilding or restoration
of the damaged portion of the Premises or otherwise.

          (d)  For the purposes of this Lease the term "Net
Award" shall mean:  (i) all amounts payable as a result
of any condemnation or other eminent domain proceeding,
less all expenses for such proceeding not otherwise
paid by Tenant in the collection of such amounts
(including without limitation, all costs and expenses
(including reasonable counsel fees and expenses)
incurred by Landlord and a first Mortgagee in
participating in any condemnation or eminent domain
proceedings) plus (ii) all amounts payable pursuant to
any agreement with any condemning authority (which
agreement shall be deemed to be a taking) which has
been made in settlement of or under threat of any
condemnation or other eminent domain proceeding
affecting the Premises, less all expenses incurred as a
result thereof not otherwise paid by Tenant in the
collection of such amounts (including without
limitation, all costs and expenses (including
reasonable counsel fees and expenses) incurred by
Landlord in participating in any condemnation or
eminent domain proceedings).

          15.  Termination of Lease Following Major Casualty,
Major Condemnation or Material Temporary Taking.

          (a)  If a Casualty, Condemnation or Material Temporary
Taking shall affect all or a substantial portion of the
Premises, and:

               (i)  in the case of a Casualty, such Casualty shall, in
          Tenant's good faith judgment, as evidenced by a
          determination of Tenant's Board of Directors, render
          the Premises unsuitable for restoration for continued
          use and occupancy in Lessee's business, and shall be
          determined to be either:

               (A)  a "total loss" for insurance purposes, or

               (B)  a loss of such dimension that the Premises cannot
                    be completely restored or rebuilt within two hundred
                    seventy (270) days computed from the hypothetical date
                    of commencement of such

<PAGE>

                    construction assuming a normal
                    40 hour per week building schedule,

               (ii) in the case of a Condemnation (other than a
          temporary taking), such Condemnation shall, in Tenant's
          good faith judgment, as evidenced by a determination of
          Tenant's Board of Directors, render the Premises
          unsuitable for restoration for continued use and
          occupancy in Tenant's business, or

               (iii) in the case of a Material Temporary Taking,
          such Material Temporary Taking shall, in Tenant's good
          faith judgment, as evidenced by a determination of
          Tenant's Board of Directors, render the Premises
          unsuitable for continued use and occupancy in Tenant's
          business during the period affected by such Material
          Temporary Taking,

then Tenant may, at its option, exercisable not later
than ninety (90) days after the date of such Casualty,
Condemnation or the commencement date of such Material
Temporary Taking, deliver to Landlord and the first
Mortgagee, if any, (A) notice (a "Termination Notice")
of its intention to terminate this Lease on the next
rental payment date that occurs not less than ninety
(90) days after the delivery of such notice (the
"Termination Date"); (B) a certificate of an authorized
officer of Tenant describing the event giving rise to
such termination and evidencing the determination of
Tenant's Board of Directors as required under
Subparagraph 15(a)(i), (ii) or (iii) above; (C) in the
case of a Casualty, either (1) the certificate of an
architect licensed in the state in which the Premises
is located stating that the architect has determined,
in its good faith judgment, that the Premises cannot be
completely restored or rebuilt for continued use and
occupancy in Tenant's business within a building
construction period of two hundred seventy (270) days
computed from the hypothetical date of commencement of
such construction assuming a normal 40 hour per week
building schedule, or (2) the written confirmation of
the insurer that the Premises are considered a total
loss; and (D) if the Termination Date occurs during the
Primary Term, an irrevocable offer (a "C/C Purchase
Offer") by Tenant to Landlord to purchase the Premises
on the Termination Date.

          (b)  If Landlord shall reject (which rejection, to be
effective, must be accompanied by the written consent
of the first Mortgagee to such rejection) the C/C
Purchase Offer by written notice given to Tenant not
later than fifteen (15) days prior to the Termination
Date, this Lease shall terminate on the Termination
Date, except with respect to obligations and
liabilities of Tenant or Landlord hereunder, actual or
contingent, which have arisen on or prior to the
Termination Date, upon payment by Tenant of all Basic
Rent and Additional Rent and other sums then due and
payable or accrued hereunder to and including the
Termination Date, and the Net Award or Net Insurance
Proceeds, as the case may be, shall belong to Landlord.
Tenant shall, on or before the Termination Date,
execute and deliver to Landlord an outright assignment
of such award or proceeds in form and substance
reasonably acceptable to Landlord and pay to Landlord
an amount equal to any applicable insurance deductible.
Unless Landlord and Mortgagee shall have rejected the
C/C Purchase Offer in accordance with this Subparagraph
15(b), Landlord shall be conclusively considered

<PAGE>

to have accepted the C/C Purchase Offer.  In the event
Landlord accepts the C/C Purchase Offer, then, on the
Termination Date, (1) Tenant shall pay to Landlord a
purchase price determined pursuant to Exhibit 15-1
attached hereto, (2) Landlord shall convey to Tenant or
its designee the Premises and (3) Landlord shall assign
to Tenant or its designee all of Landlord's interest in
the Net Award or Net Insurance Proceeds, as the case
may be, by assignment in form and substance reasonably
acceptable to Tenant, or, if Landlord has already
received such Net Award or Net Insurance Proceeds, then
Landlord shall pay the same to Tenant or Tenant's
designee.  Such sale shall otherwise be consummated in
accordance with Exhibit 15-2 attached hereto.  In the
event Tenant fails to deliver the items specified in
this Paragraph 15 strictly in accordance with the time
deadlines set forth in this Paragraph 15, then, at
Landlord's election (which election in order to be
effective must be accompanied by the written notice of
first Mortgagee to the effect that such first Mortgagee
also makes such election), Tenant shall have no right
to terminate this Lease, and the Lease will continue in
full force and effect, and in the case of a
Condemnation Tenant shall have no right to make a claim
with the condemning authority (except as provided in
the proviso at the end of the first sentence in
Subparagraph 14(a)).

          16.  Assignment and Subletting.

          (a)  Provided no Event of Default then exists, Tenant
may sublet all or any part of the Premises (provided,
that each such sublease shall expressly be made subject
to the provisions of this Lease, including Paragraph 3,
and no sublease term shall extend beyond the end of the
Term) and may assign all its rights and interests under
this Lease without Landlord's prior consent, except as
may be required below in this Paragraph 16.  If Tenant
assigns all its rights and interests under this Lease,
the assignee under such assignment shall expressly
assume all the obligations of Tenant hereunder in an
instrument, approved by Landlord as to form and
substance (which approval will not be unreasonably
withheld or delayed) and delivered to Landlord at the
time of such assignment. No assignment or sublease made
as permitted by this Paragraph 16 shall affect or
reduce any of the obligations of Tenant hereunder and
the Tenant shall remain unconditionally liable, and all
such obligations shall continue in full force and
effect as obligations of a principal and not as
obligations of a guarantor or surety, to the same
extent as though no assignment or subletting had been
made; provided that performance by any such assignee or
sublessee of any of the obligations of Tenant under
this Lease shall be deemed to be performance by Tenant.
No sublease or assignment made as permitted by this
Paragraph 16 shall impose any obligations on Landlord
or otherwise affect any of the rights of Landlord under
this Lease.  Neither this Lease nor the Term hereby
demised shall be mortgaged, pledged or hypothecated by
Tenant, nor shall Tenant mortgage or pledge the
interest of Tenant in and to any sublease of the
Premises or the rentals payable thereunder.  Any
mortgage, pledge, sublease or assignment made in
violation of this Paragraph 16 shall be void.  Tenant
shall, within ten (10) days after the execution and
delivery of any such assignment or sublease of all or
substantially all of the Premises, deliver a conformed
copy thereof to Landlord.  Within ten (10) days after
the execution and delivery of any sublease of a portion
of the Premises, Tenant shall give notice to Landlord
of the existence and term thereof, and of the name and
address of the sublessee

<PAGE>

thereunder.  In no event shall the term of a sublease of
all or part of the Premises extend beyond the last day of
the then scheduled end of the Term of this Lease.

          (b)  In addition to Tenant's rights under Subparagraph
16(a), Tenant shall have the right to assign its rights
and interests under this Lease, without Landlord's
prior consent, to (i) the surviving entity in a
statutory merger or consolidation of Tenant with
another corporation or entity where the Tenant is not
the surviving entity or (ii) to an entity to which
Tenant sells substantially all of its assets provided
(in the case of (i) or (ii)) that (1) the surviving
entity or transferee has a net worth (as determined
using generally accepted accounting principles) equal
to or greater than that of Tenant immediately prior to
such transaction and (2) Tenant gives Landlord no less
than thirty (30) prior written notice of such merger or
consolidation together with evidence reasonably
satisfactory to Landlord of the satisfaction of such
net worth requirement.  Tenant may not otherwise assign
its rights and interests under this Lease to a
surviving entity in a statutory merger or consolidation
or to an entity to which Tenant sells substantially all
of its assets unless Landlord shall give its prior
written consent which Landlord may withhold in its
absolute discretion.

          (c)  In the event of a distribution, as a dividend
to the shareholders of Tenant, of stock of a Subsidiary of
Tenant (commonly referred to as a "spin-off"), if the
net worth of the Tenant is or will be less than
$175,000,000 (as determined using generally accepted
accounting principals) after such distribution, Tenant
shall, prior to or simultaneously with such
distribution, cause the Subsidiary to validly assume or
guaranty the obligations of Tenant hereunder pursuant
to documentation reasonably acceptable to Landlord.

          17.  Intentionally Omitted.

          18.  Financial Statements.

          Tenant will deliver to Landlord and each
Mortgagee copies of all 8-K, 10-K and 10-Q reports
filed with the Securities and Exchange Commission
("SEC") by Tenant, in each case within fifteen (15)
days following delivery to the SEC; provided, however,
that if Tenant does not file such reports with the SEC,
Tenant will deliver to Landlord and each Mortgagee the
following:

          (a)  Quarterly Statements.  Within sixty (60) days
after the end of each quarterly fiscal period (except
the last) in each fiscal year of Tenant, duplicate
copies of:

               (i)  a consolidated balance sheet of Tenant and its
          consolidated subsidiaries as at the end of such
          quarter,

               (ii) a consolidated statement of profits and losses of
          Tenant and its consolidated subsidiaries for the
          current quarter and the portion of the fiscal year
          ending with such quarter, and

<PAGE>

               (iii) a consolidated statement of cash flows of
          Tenant and its consolidated subsidiaries for the
          portion of the fiscal year ending with the current
          quarter;

setting forth in each case, in comparative form the
figures for the corresponding periods a year earlier,
all in reasonable detail and certified as having been
prepared in accordance with generally accepted
accounting principles consistently applied and
certified as complete and correct by a senior financial
officer of Tenant;

          (b)  Annual Statements.  Within ninety (90) days after
the end of each fiscal year of Tenant, duplicate copies
of:

               (i)  a consolidated balance sheet of Tenant and its
          consolidated subsidiaries as at the end of such year,

               (ii) consolidated statements of profits and losses of
          Tenant and its consolidated subsidiaries for such year, and

               (iii) a consolidated statement of cash flows of
          Tenant and its consolidated subsidiaries for such year;

setting forth in each case, in comparative form, the
figures for the previous fiscal year, all in reasonable
detail and accompanied by the report thereon,
containing an opinion unqualified as to limitations
imposed by Tenant on the scope of the audit, prepared
by a firm of independent certified public accountants
of recognized national standing selected by Tenant
which opinion shall state that the consolidated
financial statements of Tenant and its consolidated
subsidiaries fairly present the financial condition of
the companies (including the results of their
operations and changes in financial position) being
reported upon, have been prepared in accordance with
generally accepted accounting principles consistently
applied and that the examination of such accounts in
connection with such financial statements has been made
in accordance with generally accepted auditing
standards and, accordingly, included such tests of the
accounting records and such other auditing procedures
as were considered necessary in the circumstances.

          (c)  Additional Information.  With reasonable
promptness, Tenant will provide Landlord and any
Mortgagee such additional financial statements and
information regarding the business affairs and
financial condition of Tenant as Landlord and such
Mortgagee may reasonably request.  In addition, Tenant
shall submit to Landlord copies of all financial
information submitted by Tenant to its institutional
lenders, bondholders and other institutional investors
as and when such information is delivered to such other
parties.  Upon the prior written request of Landlord or
any Mortgagee, but not more frequently than once per
calendar year, Tenant shall cause a senior financial
officer of Tenant to meet at Tenant's offices with
representatives of Landlord or Mortgagee to discuss the
business and financial affairs of Tenant and the
financial statements and other information submitted by
Tenant to Landlord pursuant to this Lease.
Notwithstanding the foregoing provisions of
Subparagraphs 18(a) and (b) to the contrary, in the
event the original Tenant assigns its

<PAGE>

interest in this Lease, then the quarterly and annual financial
statements and reports described in Subparagraphs 18(a)
and (b) will also be required of the then Tenant, in
addition to the original Tenant.

          19.  Permitted Contests.

          So long as no Event of Default then exists,
Tenant shall not be required to (i) pay any Imposition
(as hereinafter defined); (ii) comply with any Legal
Requirements; (iii) discharge or remove any lien,
encumbrance or charge; or (iv) obtain any waivers or
settlements or make any changes to the physical
condition of the Premises or take any other action with
respect to any encroachment, hindrance, obstruction,
violation or impairment referred to in Subparagraph
10(b), so long as Tenant shall contest, in good faith
and at its expense, the existence, the amount or the
validity thereof, the amount of the damages caused
thereby, or the extent of its liability therefor, by
appropriate proceedings provided that (A) during the
pendency of the contest there is prevented (1) the
collection of, or other realization upon, the tax,
assessment, levy, fee, rent or charge or lien,
encumbrance or charge so contested (or in the
alternative, Tenant pays the full amount in dispute
under protest); (2) the sale, forfeiture or loss of the
Premises, or any part thereof, or the Basic Rent or any
Additional Rent, or any portion thereof; (3) any
interference with the payment of the Basic Rent or any
Additional Rent, or any portion thereof; and (4) any
impairment of the fair market value of the Premises;
(B) Tenant provides to Landlord and any Mortgagee such
security against any such lien, encumbrance or charge
as Landlord or any Mortgagee shall reasonably request;
and (C) such contest shall not subject Landlord or any
Mortgagee to the risk of any criminal liability.  While
any such proceedings are pending, so long as all of the
foregoing conditions continue to be met, Landlord shall
not pay, remove or cause to be discharged the tax,
assessment, levy, fee, rent or charge or lien,
encumbrance or charge thereby being contested.  Tenant
further agrees that each such contest shall be promptly
prosecuted to a final conclusion.  Tenant shall pay,
indemnify, defend (with counsel reasonably acceptable
to Landlord and any first Mortgagee) and hold harmless
the Indemnified Parties against, any and all losses,
judgments, decrees and costs (including all reasonable
attorneys' fees and expenses, including attorneys fees
incurred to monitor any such proceedings if reasonably
deemed necessary by Landlord or Mortgagee) in
connection with any such contest and shall, promptly
after the final settlement, compromise or determination
of such contest, fully pay and discharge the amounts
which shall be levied, assessed, charged or imposed or
be determined to be payable therein or in connection
therewith, together will all penalties, fines,
interests, costs and expenses thereof or in connection
therewith, and perform all acts, the performance of
which shall be ordered or decreed as a result thereof.

          20.  Default Provisions.

          (a)  Any of the following occurrences or acts shall
constitute an event of default (herein called an "Event
of Default") under this Lease:

               (i)  If Tenant, at any time during the continuance of
          this Lease (and regardless of the pendency of any
          bankruptcy, reorganization, receivership,

<PAGE>

          insolvency or other proceedings, at law, in equity, or
          before any administrative tribunal, which have or might
          have the effect of preventing Tenant from complying with
          the terms of this Lease), shall (A) fail to make any
          payment when due of Basic Rent and such failure
          continues for five (5) days after written notice to
          Tenant thereof, (B) fail to make any payment when due
          of Additional Rent and such failure continues for
          fifteen (15) business days following receipt of written
          notice to Tenant thereof, (C) fail to maintain any
          insurance required under this Lease, or (D) fail to
          observe or perform any other provision hereof for
          thirty (30) business days after written notice to
          Tenant of such failure has been given, provided, that
          in the case of any default referred to in this Lease
          which is reasonably susceptible of cure but cannot with
          diligence be cured within such thirty (30) business day
          period, then, upon receipt by Landlord of a certificate
          of Tenant signed by an officer of Tenant stating the
          reason such default cannot be cured within thirty (30)
          business days, describing the efforts being undertaken
          by Tenant to cure such default and reasonably
          estimating the cure period, and provided that Tenant at
          all times proceeds with good faith due diligence to
          cure such default, the time within which such failure
          may be cured shall be extended for such period as may
          be necessary to complete the curing of the same with
          continuous, good faith due diligence (provided further
          that Tenant shall provide Landlord with an update of
          such original certificate, signed by an officer of
          Tenant, no less frequently than monthly, which update
          shall include a reasonably detailed description of what
          Tenant is continuing to do and what Tenant has then
          accomplished, and a reasonable estimate of how long it
          will take to complete the cure); or

               (ii) If any representation or warranty of Tenant set
          forth in this Lease or in any notice, certificate,
          demand, request or other instrument delivered pursuant
          to, or in connection with, this Lease shall prove to be
          incorrect in any material respect as of the time when
          the same shall have been made and as of the time when
          the incorrectness shall be discovered and if reasonably
          susceptible of cure shall not have been cured within
          thirty (30) business days after receipt of written
          notice to Tenant thereof, provided that, upon receipt
          by Landlord of a certificate of Tenant signed by an
          officer of Tenant stating the reason such incorrectness
          has not been cured within such thirty (30) business day
          period, describing the efforts being undertaken by
          Tenant to cure such default and reasonably estimating
          the cure period, and provided that Tenant at all times
          proceeds with good faith due diligence to cure such
          default, the time within which such incorrectness may
          be cured shall be extended for such period as may be
          necessary to complete the curing of the same with
          continuous, good faith due diligence (provided further
          that Tenant shall provide Landlord with an update of
          such original certificate, signed by an officer of
          Tenant, upon Landlord's request, which update shall
          include a reasonably detailed description of what
          Tenant is continuing to do and what

<PAGE>

          Tenant has then accomplished, and a reasonable estimate
          of how long it will take to complete the cure) but in no
          event shall the allowable cure period exceed one hundred
          eighty (180) days; or

               (iii) If Tenant shall file a petition commencing a
          voluntary case under the Federal Bankruptcy Code or any
          other federal or state law (as now or hereafter in
          effect) relating to bankruptcy, insolvency,
          reorganization, winding-up or adjustment of debts
          (hereinafter singly a "Bankruptcy Law" and collectively
          "Bankruptcy Laws") or if Tenant shall (A) apply for or
          consent to the appointment of, or the taking of
          possession by, any receiver, custodian, trustee, United
          States Trustee or liquidator (or other similar
          official) of the Premises or any part thereof or of any
          substantial portion of Tenant's property, or
          (B) generally not pay its debts as they become due, or
          admit in writing its inability to pay its debts
          generally as they become due or (C) make a general
          assignment for the benefit of its creditors, or (D)
          fail to controvert in timely and appropriate manner, or
          in writing acquiesce to, any petition commencing an
          involuntary case against Tenant or otherwise filed
          against Tenant pursuant to any Bankruptcy Law, or (E)
          take any action in furtherance of any of the foregoing; or

               (iv) If an order for relief against Tenant shall be
          entered in any involuntary case under the Federal
          Bankruptcy Code or any similar order against Tenant
          shall be entered pursuant to any other Bankruptcy Law,
          or if a petition commencing an involuntary case against
          Tenant or proposing the reorganization of Tenant under
          any Bankruptcy Law shall be filed and not be discharged
          or denied within ninety (90) days after such filing, or
          if a proceeding or case shall be commenced in any court
          of competent jurisdiction seeking (A) the liquidation,
          reorganization, dissolution, winding-up or adjustment
          of debts of Tenant, or (B) the appointment of a
          receiver, custodian, trustee, United States Trustee or
          liquidator (or any similar official) of the Premises or
          any part thereof or of Tenant or of any substantial
          portion of Tenant's property, or (C) any similar relief
          as to Tenant pursuant to any Bankruptcy Law, and any
          such proceeding or case shall continue undismissed, or
          an order, judgment or decree approving or ordering any
          of the foregoing shall be entered and continue unstayed
          and in effect for ninety (90) days.

          (b)  If an Event of Default shall have happened and be
continuing, Landlord shall have, in its sole discretion, the
following rights:

               (i)  To terminate the Term of this Lease by written
          notice to Tenant.  Thereupon, the Term of this Lease
          and the estate hereby granted shall terminate on the
          date on which Landlord sends such notice as completely
          and with the same effect as if such date were the date
          fixed herein for the

<PAGE>

          expiration of the term of this Lease, and all rights of
          Tenant hereunder shall terminate, but Tenant shall remain
          liable as provided herein.

               (ii) To (A) re-enter and repossess the Premises or any
          part thereof by force, summary proceedings, ejections
          or otherwise and (B) remove all persons and property
          therefrom, whether or not the Lease has been terminated
          pursuant to clause (i) above, Tenant hereby expressly
          waiving any and all notices to quit, cure or vacate
          provided by current or any future law.  Landlord shall
          have no liability by reason of any such re-entry,
          repossession or removal.  No such re-entry or taking of
          possession of the Premises by Landlord shall be
          construed as an election on Landlord's part to
          terminate the Term of this Lease unless a written
          notice of such intention be given to Tenant pursuant to
          clause (i) above.

               (iii) To use reasonable efforts to relet the
          Premises or any part thereof for the account of Tenant,
          in the name of Tenant or Landlord or otherwise, without
          notice to Tenant, for such term or terms (which may be
          greater or less than the period which would otherwise
          have constituted the balance of the term of this Lease)
          and on such conditions (which may include concessions
          or free rent) and for such uses as Landlord, in its
          absolute discretion, may determine; provided Landlord
          shall not be required to make any effort to relet the
          Premises except as required by applicable law.
          Landlord may collect and receive any rents payable by
          reason of such reletting.  Landlord shall not be
          responsible or liable for any failure to relet the
          Premises or any part thereof or for any failure to
          collect any rent due upon any such reletting.

               (iv) In the event of re-entry or repossession of the
          Premises or removal of persons or property therefrom by
          reason of the occurrence of an Event of Default, Tenant
          shall pay to Landlord all Basic Rent and Additional
          Rent, in each case to and including the date of such re-
          entry, repossession or removal; and, thereafter, until
          the Term has expired or has been terminated, Tenant
          shall, whether or not the Premises shall have been
          relet, be liable to Landlord for, and shall pay to
          Landlord, as liquidated and agreed current damages (A)
          all Basic Rent and all Additional Rent as and when such
          amounts would be payable under this Lease by Tenant in
          the absence of any such re-entry, repossession or
          removal, together with all expenses of Landlord in
          connection with such reletting efforts, if any
          (including, without limitation, all repossession costs,
          brokerage commissions, reasonable attorneys' fees and
          expenses, employee's expenses, alteration costs and
          expenses of preparation for such reletting), less (B)
          the net proceeds, if any, of any reletting effected for
          the account of Tenant pursuant to Subparagraph
          20(b)(iii) above. Notwithstanding the foregoing, in the
          event any such reletting is for a term longer than the
          balance of the Term, Tenant shall be responsible for
          only a

<PAGE>

          proportionate part of the expenses based on the
          balance of the Term as compared to the fixed minimum
          term of the reletting.  Tenant shall pay such
          liquidated and agreed current damages on the dates on
          which Rent would be payable under this Lease in the
          absence of such re-entry, repossession or removal, and
          Landlord shall be entitled to recover the same from
          Tenant on each such date.

               (v)  In the event of the termination of the Term by
          reason of the occurrence of an Event of Default,
          whether or not Landlord shall have collected any
          damages pursuant to clause (iv) above with respect to
          the period prior to such termination, Landlord shall be
          entitled to recover from Tenant, and Tenant shall pay
          to Landlord on demand, as and for liquidated and agreed
          final damages for Tenant's default and in lieu of all
          liquidated and agreed current damages in respect of
          Basic Rent and Additional Rent due beyond the date of
          such termination (it being agreed that it would be
          impracticable or extremely difficult to fix the actual
          damages), an amount equal to the sum of (A) the excess,
          if any, of (I) the aggregate of all Basic Rent and
          Additional Rent, in each case from the date of such
          termination for what is or would have been, in the
          absence of such termination, the then unexpired Term,
          discounted on a monthly basis at the then quoted semi-
          annual yields (which shall be converted to monthly
          yields) on U.S. Treasury securities maturing nearest
          the end of the Term (as if no termination had occurred)
          (the "Discount Rate") over (II) the then fair rental
          value of the Premises for the same period, discounted
          on a monthly basis at the Discount Rate, plus (B) the
          amount of all Prepayment Premiums which may be payable
          to any Mortgagee due to a default or required
          prepayment under any Mortgage (or under any other loan
          document entered into in connection with or pursuant to
          such Mortgage) which results from such Event of Default
          or termination of the Lease, plus (C) Landlord's other
          expenses incurred as a result of such Event of Default.
          If any applicable law shall limit the amount of
          liquidated final damages to less than the foregoing
          amount, Landlord shall be entitled to the maximum
          amount allowable under such law.  In no event will
          Landlord be obligated to pay any amount to Tenant or
          otherwise account to Tenant if the amount specified in
          clause (A)(II) of this Subparagraph 20(b)(v) is greater
          than the amount specified in clause (A)(I) of this
          Subparagraph 20(b)(v).  Tenant agrees that the credit
          provided to Tenant under clause (A)(II) of this
          Subparagraph 20(b)(v) shall fulfill any obligation
          imposed by law on Landlord to mitigate its damages.

               (vi) To accept Tenant's irrevocable purchase offer to
          purchase the Premises which Tenant shall be
          conclusively presumed to have made at the price
          determined pursuant to Exhibit 15-1 upon the occurrence
          of an Event of Default (the "Default Purchase Offer").
          The Default Purchase Offer shall be deemed to contain a
          closing date of sixty (60) days following the Event of

<PAGE>

          Default and the purchase shall be governed by the terms
          and conditions set forth in Exhibit 15-2.

          (c)  No termination of this Lease pursuant to
Subparagraph 20(b)(i), by operation of law or
otherwise, and no repossession of the Premises or any
part thereof pursuant to Subparagraph 20(b)(ii) or
otherwise, and no reletting of the Premises or any part
thereof pursuant to Subparagraph 20(b)(iii), and no
payment of any amounts by Tenant under
Subparagraph 20(b) or the exercise by Landlord of any
of its other rights under Subparagraph 20(b) shall
relieve Tenant of either (i) its liabilities and
obligations hereunder, all of which shall survive such
expiration, termination, repossession, reletting or
purchase or (ii) any liabilities under this Lease which
by express provision of this Lease survive such
expiration, termination, repossession, reletting or
purchase.

          (d)  Tenant shall reimburse Landlord from time to time
upon demand for all costs and expenses incurred by
Landlord in successfully enforcing any or all of
Landlord's rights under this Lease, including
reasonable attorneys' fees and expenses.

          21.  Additional Rights of Landlord.

          (a)  The rights and remedies set forth in Subparagraph
20(b) may be exercised in any order and in any
combination whatsoever.  No right or remedy herein
conferred upon or reserved to Landlord is intended to
be exclusive of any other right or remedy, and each and
every right and remedy shall be cumulative and in
addition to any other right or remedy given hereunder
or now or hereafter existing at law or in equity.  The
failure of Landlord to insist at any time upon the
strict performance of any covenant or agreement or to
exercise any option, right, power or remedy contained
in this Lease shall not be construed as a waiver or a
relinquishment thereof for the future.  A receipt by
Landlord of any Basic Rent, any Additional Rent or any
other sum payable hereunder with knowledge of the
breach of any covenant or agreement contained in this
Lease shall not be deemed a waiver of such breach, and
no waiver by Landlord of any provision of this Lease
shall be deemed to have been made unless expressed in
writing and signed by Landlord.  In addition to other
remedies provided in this Lease, Landlord shall be
entitled, to the extent permitted by applicable law, to
injunctive relief in case of the violation, or
attempted or threatened violation, of any of the
covenants, agreements, conditions or provision of this
Lease, or to a decree or judgment compelling
performance of any of the covenants, agreements,
conditions or provisions of this Lease, or to any other
remedy allowed to Landlord at law or in equity.

          (b)  Tenant hereby waives and surrenders for itself
and all those claiming under it, including creditors of all
kinds, (i) any right or privilege which it or any of
them may have under any present or future constitution,
statute or rule of law to redeem the Premises or to
have a continuance of this Lease for the Term hereby
demised or for a lesser period after termination of
Tenant's right of occupancy by order or judgment of any
court or by any legal process or writ, or under the
terms of this Lease or after the termination of the
Term of this Lease as herein provided, and (ii) the
benefits of any present or future

<PAGE>

constitution, statute or rule of law which exempts property
from liability for debt or for distress for rent.

          (c)  Tenant shall promptly (upon receipt of any
invoices therefor) reimburse Landlord and each
Mortgagee for any reasonable costs and expenses
incurred by Landlord and each such Mortgagee in
connection with any consents, approvals, waivers or
amendments requested by Tenant of Landlord and/or any
Mortgagee or otherwise required under or in connection
with this Lease.

          22.  Notices, Demands and Other Instruments.

          Any notice, demand, request, consent,
approval, or other instrument  ("Notice") which may be
permitted, required or desired to be given in
connection herewith shall be given in writing and
directed to Tenant or Landlord (as applicable) as follows:

          If to Tenant:       School Specialty Inc.
                              3395 West College Avenue
                              Appleton, Wisconsin  54914
                              Fax:  (920) 882-5863
                              Attn:  Donald J. Noskowiek

          With a copy to:     Franzoi & Franzoi, S.C.
                              514 Racine Street
                              Menasha, Wisconsin  54952
                              Fax:  (920) 725-0998
                              Attn:  Joseph F. Franzoi IV

          If to Landlord:     AGAWAM SSI, L.L.C.
                              c/o Mesirow Realty Sale-Leaseback, Inc.
                              350 North Clark Street
                              Suite 300
                              Chicago, Illinois  60610
                              Fax:  (312) 595-6141
                              Attn:  Garry W. Cohen

          With a copy to:     Mesirow Realty Sale-Leaseback, Inc.
                              8211 West Broward Boulevard
                              Suite 370
                              Plantation, Florida  33324
                              Fax:  (954) 370-8221
                              Attn:  David R. Piasecki
<PAGE>

          With a copy to:     Goldberg, Kohn, Bell, Black,
                               Rosenbloom & Moritz, Ltd.
                              55 East Monroe Street
                              Suite 3700
                              Chicago, Illinois  60603
                              Fax:  (312) 332-2196
                              Attn:  Stephen B. Bell

Notices shall be either (i) personally delivered
(including delivery by reputable overnight or similar
courier service) to the offices set forth above, in
which case they shall be deemed delivered on the date
of delivery to said offices, (ii) sent by certified
United States mail, return receipt requested, in which
case they shall be deemed delivered on the date shown
on the receipt unless delivery is refused or delayed by
the addressee in which event they shall be deemed
delivered on the date of deposit in the United States
mail or (iii) sent by facsimile, provided the sender of
such facsimile has evidence that the facsimile was
received by the addressee's machine, in which case they
shall be deemed delivered on the date of receipt by the
addressee's machine.  To be effective, copies of all
notices to Landlord must be given to any first
Mortgagee of which Tenant has received notice pursuant
to Paragraph 25 hereof at the address and/or facsimile
number specified by such first Mortgagee.  Either party
may by written notice to the other party given as
provided hereunder change its address for service of
Notice to any other recognized business address in the
continental United States.  Any address so designated
shall include a street address for courier delivery.

          23.  Transfer by Landlord.

          (a)  Landlord shall be free to transfer its fee
interest in the Premises or any part thereof or
interest therein to a Qualified Transferee, subject,
however, to the terms of this Paragraph 23.  Landlord
shall be released from the responsibility for the
performance of any liabilities and obligations which
shall arise under the terms, covenants and conditions
of this Lease subsequent to the date of any such
permitted transfer.  In no event shall a transfer or
sale of Landlord's interest under any of the provisions
of this Paragraph 23 be binding upon Tenant until
Tenant has received a copy of the original instrument
assigning Landlord's interest in this Lease.  Such
instrument shall evidence the fact that such assignee
or transferee has assumed full and complete liability
for all future obligations and responsibilities of
Landlord (subject to the limitations set forth in
Paragraph 38 of this Lease), which will arise under,
out of and/or in connection with this Lease from and
after the effective date of such assignment or
transfer.  In the event that Landlord transfers its
interest in this Lease pursuant to this Paragraph 23,
Tenant agrees to attorn to such assignee or transferee
with respect to Tenant's obligations under this Lease
so long as such assignee or transferee recognizes
Tenant's rights under this Lease.  Tenant shall, upon
Landlord's or such transferee's written request, enter
into an attornment agreement providing for such
attornment.  For purposes of this Lease, "Qualified
Transferee" shall mean a Person who shall represent in
writing to Tenant that such Person and its Affiliates,
if any (such Person and its Affiliates, if any, being
referred to as the "Affiliated Group"), did not have
combined gross revenues during such

<PAGE>

Affiliated Group's most recently completed fiscal year,
adjusted to reflect the annual revenue run rate from any
acquisition, merger or disposition completed or pending
since the most recent fiscal year end, from all
Competing Businesses in excess of the lesser of Fifty
Million Dollars ($50,000,000) or ten percent (10%) of
such Affiliated Group's combined gross revenues from
all sources.  For purposes of the foregoing, a
"Competing Business" is (i) a business which provides
products and/or services to the pre-Kindergarten
through Grade 12 educational market, or (ii) the
wholesale and retail stationery and office supplies
business (SIC Code 5112).  Tenant shall respond in
writing to any inquiries from Landlord within fifteen
(15) days from receipt of any inquiry as to the
propriety of a sale to an identified prospective
purchaser which may or may not be a Qualified
Transferee pursuant to this Subparagraph 23(a).  Any
such prospective purchaser identified by Landlord in
any such inquiry and not indicated by Tenant, in a
written notice to Landlord given within such fifteen
(15) day period following such inquiry by Landlord, to
be a person falling within the prohibited category or
group, shall be considered a Qualified Transferee under
this Subparagraph 23(a) until the later of (x) the date
one (1) year after (I) the date of receipt by Landlord
of Tenant's response to such inquiry, or (II) the date
of expiration of such fifteen (15) day period as to any
such inquiry to which Tenant fails to respond, or (y)
if Landlord enters into a contract for transfer within
such one (1) year period, the date such contract for
transfer is closed, terminated or expires.  The
provisions of Subparagraphs 23(a) and 23(b) shall not
apply to a foreclosure sale with respect to any
Mortgage or to the first sale of the Premises
thereafter.

          (b)  If, during the Lease Term, Landlord intends to
sell its interest in the Premises, Landlord shall give
Tenant written notice thereof which shall include a
proposed purchase price for the Premises (the "Sale
Notice").  So long as no Event of Default has occurred
and is continuing, Tenant shall have the right to
purchase Landlord's entire interest in the Premises
(but not less than such entire interest) upon the same
terms and conditions set forth in the Sale Notice and
this Subparagraph 23(b), which right shall be
exercised, if at all, only by giving Landlord written
notice thereof (the "Tenant's Purchase Notice") within
fifteen (15) business days after Tenant's receipt of
the Sale Notice.  Upon giving the Tenant's Purchase
Notice to Landlord, Tenant shall be obligated to
purchase Landlord's interest in the Premises at the
price and on the terms and conditions set forth in the
Sale Notice and this Subparagraph 23(b), such purchase
to be consummated as soon as is reasonable but in any
event within ninety (90) days after the Tenant's
Purchase Notice is received by Landlord.  The
provisions of Exhibit 15-2 shall be applicable to such
a purchase as if the purchase was occurring pursuant to
Paragraph 15, except that (i) the purchase price shall
be as set forth in the Sale Notice, and (ii) the
expenses of sale shall be shared equally, other than
attorneys' fees as respects which each party shall pay
its own counsel.  The foregoing provisions of this
Subparagraph 23(b) shall not apply to the sale by
Landlord to any Affiliate of Landlord or any Affiliate
of any partner, shareholder, member or beneficiary of
Landlord, provided such Affiliate is a Qualified
Transferee, but any such Affiliate shall remain subject
to the provisions of this Subparagraph 23(b).  If
Tenant fails to strictly comply with the provisions of
this Subparagraph 23(b) including the time period for
the giving of the Tenant's Purchase

<PAGE>

Notice, Landlord shall not be obligated to sell its
interest in the Premises to Tenant and Landlord, so long
as it shall have strictly complied with the provisions
hereof, shall be free to transfer its interest in the
Premises to any Qualified Transferee so long as the purchase
price is not less than ninety-two and five-tenths
percent (92.5%) of the purchase price set forth in the
Sale Notice (the "Minimum Price").  Upon Landlord's
written request, Tenant shall confirm in writing for
the benefit of any proposed transferee that, if such be
the case, Landlord has complied with this Subparagraph
23(b) and that Landlord is free to sell Landlord's
interest in the Premises for not less than a specified
amount which shall equal the Minimum Price.

          24.  Mortgaging by Landlord.

          Landlord shall be free to grant one or more
mortgages, deeds of trust or like security interest in
the Premises and this Lease (individually a "Mortgage")
to one or more mortgagees, deed of trust trustees or
other grantees (individually, together with each holder
of any note secured thereby, a "Mortgagee") on the
condition that either (a) this Lease shall be superior
to the Mortgage, or (b) if this Lease is to be
subordinate to the Mortgage, Tenant receives from the
Mortgagee a nondisturbance agreement reasonably
acceptable to Tenant, provided that in no event shall
this Lease be subordinated to a junior mortgage and any
attempted subordination of this Lease to a junior
mortgage shall, at the option of the first Mortgagee,
be void and of no effect.  Tenant agrees to attorn, at
the request of any Mortgagee, to such Mortgagee or
other transferee upon a transfer of title by reason of
foreclosure of such Mortgage or deed in lieu of
foreclosure thereof.  No such transfer shall be
effective as to Tenant until Tenant receives written
notice thereof and a copy of the deed or other
instrument evidencing such transfer.  In connection
with any proposed transfer, pledge or mortgage of
Landlord's fee interest in the Premises or any portion
of the ownership interests in Landlord, Tenant shall,
within fifteen (15) days after Landlord's written
request therefor, provide Landlord and the proposed
transferee and/or Mortgagee with confirmation in
writing that Tenant shall recognize such transferee and
Mortgagee as such in the event of the consummation of
the transaction described in such notice.

          Without limiting the generality of the
foregoing, at the written direction of Landlord, Tenant
shall agree in writing in respect of a first Mortgage
for the benefit of the Mortgagee thereunder that (i)
the Mortgagee is a direct assignee of Landlord's
interest under this Lease and (ii) until said Mortgage
has been released of record, all payments of Basic Rent
and Additional Rent (including any payments in respect
of a conveyance of the Premises to Tenant pursuant to
the terms of this Lease) are to be made as set forth in
said direction and no subsequent direction, election or
approval by Landlord shall be honored by Tenant until
said Mortgage has been released of record unless the
Mortgagee consents in writing to such subsequent
direction, election or approval.  Any Mortgagee which
becomes an assignee of Landlord's interest in this
Lease, whether by foreclosure of a Mortgage or pursuant
to a deed in lieu thereof, or any successor to such
assignee, shall not be obligated to perform any duty,
covenant or condition required to be performed by
Landlord under any of the terms hereof (except for
obligations that first arise on and after such time as
the Mortgagee shall obtain title

<PAGE>

to the Premises following foreclosure or deed in lieu of
foreclosure), but on the contrary, Tenant and Landlord, by
their respective executions hereof, each acknowledge and
agree that notwithstanding any such assignment each and
all of such duties, covenants or conditions required to
be performed by Landlord shall survive any such
assignment and shall be and remain the sole liability
of Landlord.  Subject to the SNDA and the prior
sentence, any transferee of Landlord's interest which
acquires such interest from a Mortgagee, and any
purchaser of such interest at a foreclosure sale in
respect of a Mortgage (or transferee of a deed in lieu
of such a foreclosure), shall not be obligated to any
duty, covenant or condition required to be performed by
Landlord under any of the terms hereof, which
obligation first arises prior to said transferee's or
purchaser's acquisition of Landlord's interest under
this Lease, shall not otherwise be liable for the
defaults of any prior Landlord hereunder and shall not
be obligated to account for or be subject to any offset
in respect of (and Tenant shall be given no credit for)
any payment of rent made more than ten (10) days in
advance of the due date of such payment unless and then
only to the extent such rental payment is actually
received by such Mortgagee or transferee.  Without
limiting the foregoing, Tenant acknowledges and agrees
that the rights of all such assignees, purchasers and
transferees in and to Basic Rent and Additional Rent
shall not be subject to any abatement whatsoever, or be
subject to any defense, setoff, counterclaim or
recoupment or reduction of any kind by reason of any
event or circumstance which occurred prior to the date
upon which any such assignee, purchaser or transferee
obtained title to the Premises or the Landlord's
interest in this Lease.  Tenant shall pay when due all
fees and expenses of any Mortgagee and its attorneys
which are payable by Landlord pursuant to the terms of
the Mortgage and which arise by reason of any default
under this Lease or any request by Tenant for any
amendment or modification of, or waiver or consent
relating to, the terms of this Lease, any assignment or
subletting or otherwise affecting the Premises.

          25.  Estoppel Certificates.

          (a)  Tenant shall at any time and from time to time,
upon not less than ten (10) days prior request by
Landlord or any Mortgagee, execute, acknowledge and
deliver to such requesting party executed Tenant's
Certificates substantially in the forms attached hereto
as Exhibits 25-1 and 25-2 to the extent then factually
correct; together with such other factually correct
information pertaining to this Lease as may be
reasonably requested by Landlord or any Mortgagee.  Any
such certificate may be relied upon by any Mortgagee,
prospective purchaser or prospective Mortgagee of the
Premises.

          (b)  Landlord shall at any time and from time to
time, upon not less than ten (10) days prior request by
Tenant, execute, acknowledge and deliver to Tenant (or
as Tenant may reasonably direct), a certificate
reciting factually correct information pertaining to
this Lease as reasonably requested by Tenant,
including, without limitation, whether to Landlord's
actual knowledge Tenant is then in default hereunder,
the last dates and amounts of Rent paid hereunder and
the dates of any modifications to this Lease.  Such
certificates may be relied upon by the parties to whom
Tenant requests that they be addressed, including
Tenant's lenders or a potential purchaser of Tenant.

<PAGE>

          26.  No Merger.

          There shall be no merger of this Lease or the
leasehold estate hereby created with the fee estate in
the Premises or any part thereof by reason of the same
person acquiring or holding, directly or indirectly,
this Lease or the leasehold estate hereby created or
any interest in this Lease or in such leasehold estate
as well as the fee estate in the Premises or any
portion thereof.

          27.  Surrender.

          Upon the termination of this Lease, Tenant
shall peaceably surrender the Premises to Landlord in
the condition in which the Premises is to be kept under
the other provisions of this Lease, including without
limitation, Paragraph 10.  Tenant shall, at Tenant's
expense, remove from the Premises prior to such
termination all property not owned by Landlord, and
immediately repair any damage caused by such removal.
Any such Property not so removed shall, at Landlord's
election, become the property of Landlord.  Landlord
may thereafter cause such property to be removed and
disposed of and the cost of repairing any damage caused
by such removal shall be borne by Tenant.
Notwithstanding anything to the contrary contained
herein, upon termination of this Lease, all building
fixtures and mechanical systems, including, but not
limited to, the plumbing, electrical, heating,
ventilation and air conditioning systems, shall remain
on the Premises and shall become the property of
Landlord.

          28.  Severability.

          Each and every covenant and agreement
contained in this Lease is separate and independent,
and the breach of any thereof by Landlord shall not
discharge or relieve Tenant from any obligation
hereunder.  If any term or provision of this Lease or
the application thereof to any person or circumstances
shall at any time be invalid and unenforceable, the
remainder of this Lease, or the application of such
term or provision to persons or circumstances or at any
time other than those to which it is invalid or
unenforceable, shall not be affected thereby, and each
such remaining term and provision of this Lease shall
valid and shall be enforced to the extent permitted by
law.

          29.  Savings Clause.

          No provision contained in this Lease which
purports to obligate the Tenant to pay any amount of
interest or any fees, costs or expenses which are in
excess of the maximum permitted by applicable law shall
be effective to the extent that it calls for payment of
any interest or other sums in excess of such maximum.

          30.  Binding Effect.

          Subject to Paragraph 24, all of the
covenants, conditions and obligations contained in this
Lease shall be binding upon and inure to the benefit of
the respective successors and assigns of Landlord,
Tenant and any Mortgagee.

<PAGE>

          31.  Memorandum of Lease.

          Simultaneously with the execution and
delivery hereof, Landlord and Tenant shall enter into
and record, at Tenant's expense, a memorandum of this
Lease in the form of Exhibit 31 attached hereto.

          32.  Table of Contents; Headings.

          The table of contents and headings used in
this Lease are for convenient reference only and shall
not to any extent have the effect of modifying,
amending or changing the provisions of this Lease.

          33.  Governing Law.

          This Lease shall be governed by and
interpreted under the laws of the state in which the
Premises are located.

          34.  Certain Definitions.

          (a)  The term "Legal Requirements" means collectively
(i) all laws, rules, regulations, ordinances or orders,
in effect from time to time, of all federal, state,
local, county and other governmental authorities having
authority over the Premises, any portion thereof, the
use thereof, Tenant or Landlord, including without
limitation, all Environmental Laws and the Americans
With Disabilities Act of 1990, 42 U.S.C. Section 12101
et seq. and (ii) all covenants, restrictions and
agreements to which the Premises are subject.

          (b)  The term "Imposition" means:

               (i)  all real estate taxes which either become due
          during the Term or accrue during the Term and all other
          assessments (including assessments for benefits from
          public works or improvements, whether or not begun or
          completed prior to the commencement of the Term of this
          Lease and whether or not to be completed within the
          Term), levies, fees, water and sewer rents and charges,
          and all other governmental charges of every kind,
          general and special, ordinary and extraordinary,
          whether or not the same shall have been within the
          express contemplation of the parties hereto, together
          with any interest and penalties thereon, which are, at
          any time, imposed or levied upon or assessed against
          (A) the Premises or any part thereof, (B) any Basic
          Rent or any Additional Rent, (C) this Lease or the
          leasehold estate hereby created or which arise in
          respect of the ownership, operation, possession,
          occupancy or use of the Premises and which either
          become due during the Term or accrue during the Term;

               (ii) any gross receipts or similar taxes imposed or
          levied upon, assessed against or measured by the Basic
          Rent or Additional Rent hereunder

<PAGE>

          or levied upon or assessed against the Premises (but
          calculated assuming the Basic Rent and Additional Rent
          are the only receipts of Landlord);

               (iii) all sales and use taxes which may be levied
          or assessed against, or payable by, Landlord or Tenant
          on account of the acquisition, payment of rent or
          leasing or use of the Premises or any portion thereof; and

               (iv) all charges for water, gas, light, heat,
          telephone, electricity, power and other utilities and
          communications services rendered or used on or about
          the Premises.

          (c)  The term "Lease" means this Lease, as amended and
modified from time to time, together with any
memorandum or short form of lease entered into for the
purpose of recording.

          (d)  The term "Landlord" means the owner of the
rights of the Landlord under this Lease and upon any
assignment or transfer of such rights, except an
assignment or transfer made as security for an
obligation, any heirs, successors and assigns.  The
assignor or transferor shall be relieved of all future
duties and obligations under this Lease provided the
assignee or the transferee shall expressly agree in
writing to be bound by and to assume all the covenants
of Landlord hereunder arising from and after such
assignment or transfer.

          35.  Assignment of Intangibles.

          No later than ninety (90) days following the
expiration or earlier termination of this Lease,
Landlord may require in a written notice to Tenant that
Tenant assign to Landlord, effective as of such
expiration or earlier termination of the Term, all
rights of Tenant in and to such intangible personal
property used by Tenant in connection with the Premises
as is designated by Landlord in such notice, including,
without limitation, any contract rights, guaranties,
licenses, permits, registrations and warranties
(including without limitation licenses, permits and
registrations pertaining to any clean-up or remediation
of Hazardous Material on or about the Premises to the
extent such licenses, permits and registrations may be
assigned to Landlord) but excluding any trade names,
service marks, corporate names or other business
licenses used by Tenant in the operation of its
business.  Subject to and without release of any
obligation of Tenant to Landlord under this Lease which
by the terms of this Lease survives the termination or
expiration of this Lease, including without limitation
Tenant's indemnity obligations under Paragraphs 7 and 8
of this Lease, Landlord shall assume any future
obligations of Tenant in respect of any such assigned
intangible personal property in form reasonably
acceptable to Landlord and Tenant.  Tenant shall
execute such assignments and/or bills of sale of the
intangible personal property as Landlord may reasonably
request, provided the same do not impose any additional
liability on Tenant and are otherwise reasonably
acceptable to Tenant.  The obligations of Tenant under
this Paragraph 35 shall survive the expiration or
earlier termination of this Lease.

<PAGE>

          36.  Representation and Warranties.

          To induce Landlord to enter into this Lease,
Tenant makes the representations and warranties set
forth in Exhibit 36 to this Lease.

          37.  Exhibits.

          The Exhibits attached hereto are hereby
incorporated by reference into this Lease and made a
part hereof.

          38.  Exculpatory Clause.

          Notwithstanding any provision of this Lease
to the contrary, the liability of Landlord under and
with respect to this Lease shall be limited to the
interest of Landlord in the Premises, and any judgment
in favor of Tenant or any party claiming by, through or
under Tenant against Landlord shall be collectible only
out of Landlord's interest in the Premises, and in no
event shall any judgment for damages be entered against
Landlord which is in excess of the value of such
interest.

          39.  Jury Waiver.

          Landlord and Tenant each hereby waive any
right it may have to trial by jury in any action or
proceeding arising from a dispute under this Lease.

          40.  Quiet Enjoyment.

          So long as Tenant is not in default of any of
its covenants and obligations under this Lease, Tenant
shall be entitled to peaceful and quiet enjoyment of
the Premises, subject, however, to the express terms
and conditions of this Lease, including without
limitation, Paragraph 6 hereof.

          (a)  Landlord shall join in, and shall cause any
Mortgagee to join in and subordinate the Mortgage to,
easements or reciprocal easement agreements (each a
"Tenant Easement" and collectively "Tenant Easements")
required for Tenant's use and operation of the
Premises, provided (i) Tenant receives no compensation
for such easements, (ii) such Tenant Easement does not
reduce the value of the Premises or the projected value
of the Premises at the end of the Term, and (iii) such
Tenant Easement is otherwise reasonably acceptable to
Landlord and Mortgagee.  Landlord and Mortgagee shall
not unreasonably withhold or delay their consent to any
such Tenant Easement.

          (b)  Tenant shall join in easements or reciprocal
easement agreements (each a "Landlord Easement" and
collectively "Landlord Easements") which are either
(i) reasonably required for the operation of the
Premises (as opposed to Tenant's business on the
Premises) or which (ii) (A) do not materially interfere
with Tenant's use and operation of the Premises,
(B) impose no material obligations on Tenant and
(C) are otherwise reasonably acceptable to Tenant.

<PAGE>

          41.  Early Termination Option.

          (a)  Provided no Event of Default shall exist
at the time notice is given by Tenant hereunder, Tenant
shall have the right on one (1) occasion only to give
Landlord written notice of Tenant's desire to cause an
early termination of this Lease as follows:

               (1)  On no less than twelve (12) months
          and no more than fifteen (15) months prior
          written notice to Landlord designating as a
          proposed termination date the first day of
          the eleventh year of the Primary Term or the
          first day of any subsequent year of the
          Primary Term; or

               (2)  On no less than fifteen (15) months
          and no more than eighteen (18) months prior
          notice designating as a proposed termination
          date the first business day of any calendar
          month in or after the eleventh year of the
          Primary Term

(the date designated pursuant to clause (1) or (2)
being the "Proposed Early Termination Date" and any
written notice of early termination given pursuant to
clause (1) or (2) being an "Early Termination Notice").
The Early Termination Notice shall be deemed to be a
continuing offer by Tenant (until the end of the
Marketing Period (as defined below)) to terminate this
Lease on the terms set forth in this Paragraph 41.
During the Marketing Period, Landlord shall reasonably
cooperate with Tenant to allow Tenant to market the
sale of Landlord's interest in the Premises, though in
no event shall Tenant have any right to act as
Landlord's agent or broker or to bind Landlord in any
way.  Landlord may also market the sale of Landlord's
interest in the Premises, and Tenant shall reasonably
cooperate with Landlord's marketing activities.  It is
understood that any such marketing and any sale of
Landlord's interest in the Premises under this
Paragraph 41 shall be based on a sale free and clear of
this Lease.  Tenant shall pay all expenses in
connection with such marketing efforts (including
without limitation the preparation of brochures,
advertising and other customary marketing expenses
("Marketing Expenses")) incurred by Tenant and all
Marketing Expenses incurred by Landlord and approved in
advance by Tenant, which approval shall not be
unreasonably withheld.  Landlord's reasonable Marketing
Expenses shall be reimbursed by Tenant within twenty
(20) days after each request therefor.  Landlord and
Tenant each shall promptly provide to the other a copy
of each written offer, term sheet or letter of intent
received during the Marketing Period by such party for
the purchase of Landlord's interest in the Premises.

          During the period following Landlord's
receipt of the Early Termination Notice and prior to
the earliest to occur of (A) the Proposed Early
Termination Date, (B) the giving by Landlord of a
Notice of Acceptance or (C) the giving by Landlord of a
Notice of Qualified Offer Rejection (as defined below)
(the "Marketing Period"), Landlord may sell its
interest in the Premises on whatever terms it chooses;
provided, however, that:

               (i)  Landlord will not accept any offer
          without Tenant's written consent unless the
          Adjusted Price is at least equal to ninety
          percent (90%) of

<PAGE>

          the applicable purchase price set forth on
          Exhibit 15-1 (the "Scheduled Price");

               (ii) subject to Paragraph 41(d)(ii)
          below, Landlord will accept a Qualified Offer
          if Landlord receives one, so long as the
          Adjusted Price is at least equal to one
          hundred ten percent (110%) of the applicable
          Scheduled Price; and

               (iii)     subject to Paragraph 41(d)(ii)
          below, if no such Qualified Offer with an
          Adjusted Price at least equal to one hundred
          ten percent (110%) of the applicable
          Scheduled Price is received by Landlord by
          the end of the sixth (6th) month of the
          Marketing Period, then, subject to
          Subparagraph (d) below, Landlord will
          thereafter during the Marketing Period accept
          any Qualified Offer, whatever the Adjusted
          Price, if Tenant specifically directs
          Landlord in writing to accept such Qualified
          Offer.

          (b)  A "Qualified Offer" shall mean an offer
from a financially responsible party (who is not Tenant
or any Affiliate of Tenant or any Affiliate of
Landlord) for an all-cash sale, accompanied by earnest
money of not less than two percent (2%) of the sale
price (which may be non-forfeitable for a due diligence
period of up to sixty (60) days, after which it becomes
forfeitable), which calls for a closing not earlier
than the Proposed Early Termination Date and not later
than three (3) months after the Proposed Early
Termination Date and with provisions for termination of
Tenant's possession rights consistent with the
provisions of Subparagraph 41(c)(ii), and which does
not contain, in Landlord's reasonable judgment, any
provisions which are not customary in the locality of
the Premises or which cannot reasonably be performed or
caused to be performed by Landlord at Tenant's cost.
Further, Landlord shall not be obligated to provide the
purchaser with any representations, warranties,
liabilities or indemnities with respect to the
Premises, beyond the delivery at closing of (A) a
special warranty deed subject only to the items
described in clause B of Exhibit 15-2, (B) such
seller's affidavit or similar document as customarily
provided to the title company or purchaser in
connection with similar sales in the state in which the
Premises are located, as respects which it shall be
indemnified by Tenant and (C) other agreements or
documents, if any, as the purchaser may reasonably
require and as to which Landlord is fully indemnified
under a surviving provision of the Lease or an
agreement delivered by Tenant in connection with such
sale.

          The "Adjusted Price" shall be the gross
purchase price set forth in the Qualified Offer,
reduced by the amount of any brokerage commissions or
finder's fees which would have to be paid by Landlord
thereunder.  Notwithstanding the foregoing, the gross
purchase price shall not, without the prior written
consent of Tenant, be reduced by (i) brokerage
commissions or finder's fees (inclusive of any
commissions or fees payable to any Affiliates of
Landlord) in excess of six percent (6%) of the gross
purchase price or (ii) brokerage commissions or
finder's fees payable to Affiliates of Landlord in
excess of three percent (3%) of the gross purchase
price (any brokerage commissions or fees excluded as
aforesaid being "Excess Fees").

<PAGE>

          An "Affiliate" of a party shall mean a person
or entity (i) which directly or indirectly through one
or more intermediaries controls, or is controlled by,
or is under a common control with, the applicable
party, (ii) which beneficially owns or holds fifty
percent (50%) or more (by number of votes) of any class
of the voting stock of the applicable party, or
(iii) fifty percent (50%) or more (by number of votes)
of the voting stock (or in the case of a person which
is not a corporation, fifty percent (50%) or more of
the equity interest) of which is beneficially owned or
held by the applicable party or its subsidiary.  The
term "control" means the possession, directly or
indirectly, of the power to direct or cause the
direction of the management and policies of a person or
entity through the ownership of voting securities, by
contract of otherwise.

          (c)  If during the Marketing Period Landlord
enters into a contract to sell its interest in the
Premises pursuant to the foregoing provisions of this
Paragraph 41 (a "Purchase Contract"), Landlord will use
good faith efforts to close the sale in accordance with
such contract.  The date of the actual closing of such
sale is hereinafter referred to as the "Early
Termination Closing Date."

          On the Early Termination Closing Date but
only if a closing under the Purchase Contract occurs,
each of the following clauses (i) through (vi) shall
apply:

               (i)  Landlord and Tenant shall execute
          an agreement terminating this Lease as of the
          Early Termination Closing Date, and deliver
          such evidence of authority for the execution
          thereof as shall be reasonably required by
          the purchaser and/or any title insurer.

               (ii) Tenant shall vacate the Premises
          and this Lease shall terminate on the Early
          Termination Closing Date and upon such
          vacation the Premises shall be returned to
          Landlord or to the purchaser in the condition
          required under the Lease.

               (iii)     In connection with any sale of
          the Premises pursuant to this Paragraph 41,
          but not if the Lease terminates without a
          sale by Landlord, Tenant shall deliver to
          Landlord an irrevocable undertaking from
          Tenant obligating Tenant to (A) refrain from
          owning or using the Premises for a period of
          two (2) years from the Early Termination
          Closing Date (the "Prohibition Period") and
          (B) cause all of its Affiliates to refrain
          from owning or using the Premises during the
          Prohibition Period.  Such undertaking shall
          provide for liquidated damages against
          Tenant, in the event of violation of any of
          such covenants, in the amount of the Basic
          Rent which would have accrued during the
          Prohibition Period if this Lease had not been
          terminated and, if the Prohibition Period
          includes a period after the end of the
          Primary Term, assuming that the Basic Rent
          for such period is at a rate equal to One
          Hundred Ten percent (110%) of the Basic Rent
          for the last year of the Term.

<PAGE>

               (iv) Tenant shall make payment (the
          "Early Termination Payment") to Landlord, in
          good funds by wire transfer, equal to the
          amount, if any (but not less than zero), by
          which the aggregate of the Scheduled Price
          applicable at the Early Termination Closing
          Date, plus all applicable Prepayment
          Premiums, exceeds the Net Sales Proceeds of
          the sale;

               (v)  Tenant shall pay on the Early
          Termination Closing Date, all costs of
          operation of the Premises incurred or accrued
          through such date including utilities and
          Impositions (collectively, "Accrued Property
          Expenses") and all accrued Basic Rent;

               (vi) Landlord shall distribute the
          amount, if any, by which Net Sales Proceeds
          less all applicable Prepayment Premiums
          exceeds the aggregate of the Scheduled Price
          determined as of the Early Termination
          Closing Date, in the following order of
          priority:

                    (1)  First, to the extent
               sufficient therefor, to reimburse Tenant
               for Marketing Expenses in connection
               with such sale;

                    (2)  The balance, to Landlord.

               The "Net Sales Proceeds" of such sale
          shall be the Adjusted Price minus any and all
          costs and expenses incurred by Landlord in
          connection with such sale (other than
          brokerage commissions deducted in computing
          the Adjusted Price and, in any event,
          excluding Excess Fees), including without
          limitation, closing costs, net prorations,
          attorneys' fees, transfer taxes, costs of
          title insurance, survey costs, costs of
          environmental reports and any and all other
          reasonable expenses incurred by Landlord in
          effectuating such sale.  Marketing Expenses
          shall not be deducted in calculating Net
          Sales Proceeds but rather shall be paid by
          Tenant pursuant to this Section 41.  Since
          Tenant will pay all Accrued Property Expenses
          and accrued Basic Rent at the closing of such
          sale, Net Sales Proceeds shall be calculated
          without regard to prorations for such items.

               In the event Tenant fails to perform any
          of its obligations in connection with clauses
          (i), (ii), (iii), (iv) or (v) above, Tenant
          shall indemnify Landlord against any and all
          loss, damage, cost and expense incurred by
          Landlord as a result of such failure,
          including without limitation, reasonable
          attorneys' fees, and all loss, damage, cost
          and expense incurred under any contract to
          sell Landlord's interest in the Premises,
          whether or not the closing occurs.  In no
          event shall Landlord be obligated to close
          unless Tenant performs all such obligations
          at or prior to such closing.

          (d)  Notwithstanding any of the foregoing
provisions of this Paragraph 41 to the contrary:

<PAGE>

               (i)  Subject to clauses 41(d)(ii) and
          (iii) below, if a Purchase Contract is not
          entered into during the Marketing Period, or
          if for any reason whatsoever the closing of
          the sale fails to occur as provided in the
          Purchase Contract (including without
          limitation, the breach by the purchaser
          thereunder, but excluding a failure caused
          solely due to Landlord's breach of such a
          contract, which breach by Landlord was not
          due to a breach by Tenant of its obligations
          under this Paragraph 41 or any other
          provision of this Lease), then this Lease
          shall not terminate and shall continue in
          full force and effect, provided, however,
          that in the event of any failure to close
          caused by a breach of the purchaser, the
          Earnest Money under the contract shall first
          be applied to Marketing Expenses, including
          but not limited to amounts payable to
          brokers, if any, and costs of collection and
          attorneys' fees, if any, incurred in
          connection with the sale transaction and
          recovery of the Earnest Money, and the
          balance of the Earnest Money shall be equally
          divided between Landlord and Tenant, and
          Landlord shall assign to Tenant any and all
          of its remaining rights and claims against
          said purchaser, provided further that, if
          Tenant prosecutes any of such remaining
          rights against the defaulting purchaser, it
          shall indemnify Landlord against all claims
          asserted by the purchaser against Landlord in
          connection with or arising from any
          enforcement or other legal action brought by
          Tenant.

               (ii) Landlord may elect to reject by
          written notice (which notice, to be
          effective, must be countersigned by the first
          Mortgagee) (the "Notice of Qualified Offer
          Rejection") a Qualified Offer during the
          Marketing Period which Landlord would
          otherwise be required under Paragraph
          41(a)(ii) or (iii) to accept.  Landlord shall
          include with the Notice of Qualified Offer
          Rejection a copy of such rejected Qualified
          Offer ("Rejected Qualified Offer").  If
          Landlord duly gives a Notice of Qualified
          Offer Rejection, then, on the Proposed Early
          Termination Date, (w) this Lease shall
          terminate, (x) Tenant shall pay all Accrued
          Expenses and accrued Basic Rent, (y) Tenant
          shall vacate and return the Premises to
          Landlord in the condition required under this
          Lease, and (z) Tenant shall pay Landlord the
          Early Termination Payment with (i) Net Sales
          Proceeds being deemed to be the Net Sales
          Proceeds (as reasonably determined by
          Landlord and Tenant) which would have been
          received if the Qualified Offer had been
          accepted and had closed on the Proposed Early
          Termination Date, and (ii) the Scheduled
          Price and applicable Prepayment Premiums
          being determined as of the Proposed Early
          Termination Date.

               (iii) At any time after Landlord receives the Early
                     Termination Notice and prior to the receipt by Landlord
                     of a Qualified Offer, which Landlord is obligated to
                     accept pursuant to Paragraph 41(a), Landlord may by
                     written notice to Tenant (which notice, to be
                     effective, must be countersigned by the first
                     Mortgagee)

<PAGE>

                     (the "Notice of Acceptance") accept Tenant's
                     offer to terminate the Lease as contained or deemed
                     contained in Tenant's Early Termination Notice, in
                     which event on the Proposed Early Termination Date (w)
                     this Lease shall terminate, (x) Tenant shall pay all
                     accrued Basic Rent and Accrued Property Expenses, (y)
                     Tenant shall vacate and return the Premises to Landlord
                     in the condition required under this Lease, and (z)
                     Tenant shall be released from any continuing obligation
                     to pay Landlord any amount in respect of the Early
                     Termination Payment.

          (e)  The obligations of the parties under
this Paragraph 41 which accrue prior to the termination
of the Lease shall survive the termination of the Lease.

          42.  Landlord Initiated Financing.

          In the event that, at any time during the
Primary Term, Landlord refinances its Mortgage debt,
Landlord shall give Tenant written notice ("Landlord
Initiated Finance Notice") thereof no later than thirty
(30) days following the closing thereof, which notice
shall specify the Financing Expenses (or if the notice
is given prior to closing of the refinancing, the
estimated Financing Expenses) and material terms of the
refinancing.  If the Landlord Initiated Finance Notice
does not specify the actual Financing Expenses,
Landlord shall, by written notice, advise Tenant of the
actual Financing Expenses promptly following the
establishment of the same.  Landlord may give the
Landlord Initiated Finance Notice at any time prior to
the closing of the refinancing provided the material
terms of the refinancing have been established.
Provided no Event of Default has occurred and is
continuing, Tenant may, within fifteen (15) days
following receipt of such Landlord Initiated Finance
Notice or, if later, within fifteen (15) days following
receipt by Tenant of Landlord's statement of the actual
Financing Expenses, elect by written notice (the
"Finance Election Notice") to Landlord to share in the
Interest Savings (as defined below).  In the event
that, at the time the Finance Election Notice is given,
the closing of the financing has occurred, then, to be
effective, the Finance Election Notice shall be
accompanied by payment by Tenant to Landlord of an
amount equal to Tenant's Share of the Financing
Expenses.  In the event the closing of the refinancing
occurs after the Finance Election Notice is given, the
Tenant shall pay to Landlord at or prior to the closing
of the financing an amount equal to Tenant's Share of
the actual Financing Expenses.  If Tenant gives a
timely Finance Election Notice and pays Tenant's Share
of the Finance Expenses in accordance with this
Paragraph 42, then, after the closing of the
refinancing, Tenant shall be entitled to a rent credit
with respect to each monthly installment of Basic Rent
due thereafter during the Primary Term equal to fifty
percent (50%) of the Interest Savings, if any, with
respect to the debt service payment due on or about the
due date of such installment of Basic Rent.  "Interest
Savings" shall mean the amount, if any, by which the
interest component of a scheduled monthly debt service
payment under the new Mortgage debt is less than the
product of one-twelfth of the annual interest rate
applicable under the paid off Mortgage debt times the
principal amount of the new Mortgage debt outstanding
immediately prior to application of

<PAGE>

such monthly debt service payment.  Tenant shall not be
entitled to share in Interest Savings or to any other credit,
offset, relief or damages if the financing contemplated in a
Landlord Initiated Finance Notice does not close
regardless of the reason for such failure to close,
even Landlord's voluntary default under the loan
commitment.  Notwithstanding the foregoing provisions
of this Paragraph 42, Tenant shall not be entitled to
any Interest Savings with respect to any monthly
installment of Basic Rent which is not paid on or
before the expiration of any grace period following the
due date thereof or with respect to any monthly
installment of Basic Rent which is paid during the
continuance of any Event of Default.  Moreover, Tenant
shall not be entitled to share in any interest savings
occurring during any period after the Primary Term.
For purposes of this Paragraph 42, (a) "Financing
Expenses" shall mean (i) all Prepayment Premiums or
other premium, penalty, yield maintenance or other fees
required to prepay the then existing debt and any
commitment fees and other similar charges incurred in
obtaining the new financing, and (ii) all other costs
and expenses incurred by Landlord and the Mortgagee and
the new lender in connection with any refinancing of
Landlord's Mortgage debt, including without limitation,
recording fees, title insurance expenses and fees and
expenses of Landlord's counsel, Mortgagee's counsel and
counsel to the new lender; (b) "Tenant's Share of
Financing Expenses" shall mean 100% of the items listed
in clause (i) of the definition of Financing Expenses
plus Tenant's Pro Rata Portion of the items listed in
clause (ii) of the definition of Financing Expenses;
and (c) "Tenant's Pro Rata Portion" shall mean a
fraction, the numerator of which shall be the number of
whole calendar months remaining in the Primary Term of
the Lease following the closing of the refinancing and
the denominator of which shall be the number of whole
calendar months in the term of the refinancing loan.

<PAGE>

          IN WITNESS WHEREOF, the parties hereto have
executed this Lease as of the day and year first above
set forth.

                           LANDLORD:

                           AGAWAM SSI, L.L.C., a Delaware
                           limited liability company

                           By  MESIROW REALTY SALE-LEASEBACK,
                               INC., an Illinois corporation, it sole member

                               By  /s/ Garry W. Cohen
                                   ------------------------------------------
                               Name    Garry W. Cohen
                               Its     Senior Executive Vice President


                            TENANT:

                            SCHOOL SPECIALTY INC., a Wisconsin
                            corporation


                            By  /s/ Daniel P. Spalding
                                ---------------------------------------------
                            Name    Daniel P. Spalding
                            Its     Chairman and CEO

<PAGE>

                           EXHIBITS

Exhibit 1.1         Legal Description
Exhibit 5-1         Interim Term and Primary Term Basic Rent
Exhibit 5-2         Extended Term Basic Rent
Exhibit 2           Permitted Exceptions
Exhibit 15-1        Purchase Price Schedule
Exhibit 15-2        Additional Sales Closing Requirements
Exhibit 17          Determination of Fair Market Value
Exhibit 25-1        Estoppel Certificate
Exhibit 25-2        Estoppel Certificate
Exhibit 31          Memorandum of Lease
Exhibit 36          Representations and Warranties


The above exhibits to this document have been omitted.
The exhibits will be furnished supplementally to the
Securities and Exchange Commission upon request.