Document:

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                                                                   Exhibit 10.11

                              THE PRINCETON REVIEW
                          EXECUTIVE COMPENSATION POLICY

The Princeton Review, Inc ("TPR") wants to fairly compensate its senior
management in a consistent and clear way. This document will serve as an
addendum to the employment agreements of executives selected by the Chief
Executive Officer ("CEO") or the Board of Directors (the "Board"). Any of its
terms may be superseded by the specific employment agreement, which along with
this addendum, will be referred to herein as the "Agreement".

The issues covered are as follows: (1) Who is eligible; (2) Responsibilities and
Non-compete; (3) Term & Compensation; (4) Termination for Cause, Disability or
Death; (5) Severance Benefits and Payments; (6) Change of Control; and the
always-popular (7) Legal Stuff.

1.       Who is Eligible:

         (a)      The CEO or the Board shall decide who will be covered under
                  the Executive Compensation Policy.

         (b)      An executive will not be covered under the Executive
                  Compensation Policy unless he or she has an effective
                  employment agreement that provides for such participation.

2.       Responsibilities and Non-compete:

         (a)      So long as this Agreement continues in effect, the Executive
                  shall devote full business time and energies to the business
                  affairs, including management and financial responsibilities,
                  of TPR. Further, he or she will use his or her best efforts,
                  skill and abilities to promote their interests, in accordance
                  with guidelines, policies and objectives established by TPR
                  and his or her manager.

         (b)      Any materials, writings, graphics, techniques, methods or
                  products relating or reasonably applicable to TPR business, or
                  any natural extension thereof, which may be developed by the
                  Executive during his or her term of employment with TPR shall
                  inure solely and fully to the benefit of TPR, without any
                  additional compensation to the Executive.

         (c)      In the event of a breach or threatened breach by the Executive
                  of any provision of this Agreement which would be difficult to
                  measure in terms of monetary damages, including, but not
                  limited to, the disclosure of confidential business
                  information, or the unauthorized rendering of services to any
                  person or firm engaged in a business competitive with that of
                  TPR or its franchises as described in Section 2(d) below, TPR
                  shall by agreement of the parties be entitled to obtain a
                  restraining order, injunction and all other appropriate
                  equitable remedies in addition to other applicable remedies
                  provided by applicable law. It is expressly agreed that the
                  Executive's obligation to maintain the confidentiality of the
                  business of TPR and its franchises, which are not matters of
                  general public knowledge, will survive the termination of this
                  Agreement.

         (d)      The Executive shall not, during the term of this Agreement or
                  for a period of

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                           eighteen (18) months following the expiration or
                           termination of this Agreement:

                  (i)      engage in any capacity, in the business of providing
                           assistance with respect to preparation for
                           standardized examinations or the college,
                           professional school, or graduate school admissions
                           process, within a 100 mile radius of any county being
                           served by TPR or its franchises, without the advance
                           written consent of TPR, or

                  (ii)     solicit the services of any employee of TPR or any of
                           its franchises (or any individual employed by TPR or
                           any of its franchises within the then most recent 12
                           months) or take any action that results, or might
                           reasonably result, in any employee ceasing to perform
                           services for TPR or any of its franchises and
                           commencing to perform services for the Executive or
                           any person or entity associated with the Executive.
                           If the Executive breaches this Section 2(d), he or
                           she will immediately forfeit as of the time of such
                           breach the right to receive any severance payments or
                           benefits under this Agreement and forfeit the gain
                           from any stock options exercised following a
                           termination of employment. In addition, TPR will be
                           entitled to require that the Executive repay to TPR
                           the value of any such payments or benefits previously
                           paid to the Executive and to pursue any additional
                           remedies at law or equity, including, without
                           limitation, those contemplated by Section 2(c) above.

         (e)      If any provision of this Section 2 is found to be void or
                  unenforceable, in whole or in part, then the remainder of the
                  provisions of this Section 2 will remain in full force and
                  effect and in no way be affected or impaired, and the
                  provision so found to be void or unenforceable will be deemed
                  modified in amount, duration, scope or otherwise to the
                  minimum extent necessary such that such provision shall not be
                  void or unenforceable and, as so modified, will remain in full
                  force and effect.

3.       Term & Compensation:

         (a)      The Agreement has an initial one-year term, which will
                  automatically be extended for additional two-year periods on
                  each anniversary of the effective date until (i) the Executive
                  voluntarily terminates employment or (ii) TPR gives contrary
                  written notice to the Executive at least 60 days prior to the
                  anniversary date.

         (b)      Base annual salary is payable in 26 equal bi-weekly
                  installments.

         (c)      A health insurance plan comparable to the best plan being
                  provided on a current basis to management executives of TPR or
                  other TPR employees.

         (d)      Other benefits such as 401(k), cafeteria plan, educational
                  reimbursement and such others as may be provided to other
                  management personnel of TPR or other TPR employees.

         (e)      Three weeks of paid vacation.

4.       Termination for Cause, Disability or Death:

         (a)      TPR may terminate the Executive's employment for "Cause" for
                  any of the following reasons:

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                  (i)      dishonesty, or conviction of a crime involving moral
                           turpitude or a felony;

                  (ii)     disloyalty, which specifically shall include, but not
                           be limited to, breach of any of the provisions of
                           Section 2 above or actions which are inconsistent
                           with the fiduciary duty owed TPR by the Executive
                           arising by law from his or her employment as an
                           officer and agent of TPR;

                  (iii)    intentional failure to perform the material duties of
                           his or her employment in a competent manner, and
                           failure to substantially remedy such failures within
                           thirty (30) days following receipt of written notice
                           of specific deficiencies from the CEO, Chief
                           Operating Officer, or the Board; or

                  (iv)     a material breach of this Agreement that is not
                           otherwise specifically herein set forth.

         (b)      TPR may terminate the Executive's employment due to his or her
                  "Disability." For purposes of this Agreement, the Disability
                  of the Executive shall mean that the Executive shall fail
                  because of illness or incapacity to perform for 90 successive
                  days, or for shorter periods aggregating 90 days or more in
                  any consecutive 12-month period (the "Periods of Disability"),
                  the duties of employment. In no event will the Executive's
                  absence from work on an approved maternity or paternity leave
                  be counted as a Period of Disability.

         (c)      This Agreement shall terminate immediately upon the
                  Executive's death.

         (d)      If either party terminates this Agreement, neither shall
                  publicly disclose the reason or basis for the termination,
                  except if the reason or basis was a conviction of a crime of
                  the kind described in Section 4(a) above.

5.       Severance Payments and Benefits:

         (a)      If the Executive's employment terminates for any reason during
                  the term of the Agreement, the Executive will be entitled to
                  receive his or her salary through the date of termination (and
                  a cash payment for vacation accrued to that date).

         (b)      If TPR terminates the Executive's employment due to his or her
                  Disability, then, in addition to the payments provided under
                  Section 5(a) above (which will include the salary accrued by
                  the Executive during the Period(s) of Disability), the
                  Executive will also continue to receive base salary for a
                  period of six months following the date of termination, minus
                  any other Disability benefits provided by TPR to the Executive
                  during this period. Payment under this Section 5(b) will,
                  however, immediately cease upon the Executive's return to
                  employment with TPR or any other employer.

         (c)      If TPR terminates the Executive's employment without Cause
                  under Section 4(a) above, then, in addition to the payments
                  provided under Section 5(a) above, TPR will pay the Executive
                  his or her annual base salary for an additional six months
                  following termination. In addition, the Executive will be
                  entitled to reimbursement of COBRA payments to maintain
                  medical and dental insurance for a number of weeks equal to
                  twice the number of years he or she was employed full-time by
                  TPR.

         (d)      If TPR does not renew the Agreement under Section 3(a) above,
                  then, in addition
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                  to the payments provided under Section 5(a) above, TPR will
                  give the Executive a lump-sum payment equal to his or her
                  weekly salary multiplied by twice the number of years he or
                  she was employed full-time by TPR. This payment will not be
                  due if TPR is in the process of Terminating for Cause at the
                  time of renewal.

6.       Change of Control:

         (a)      A "Change in Control" will occur upon

                  (i)      an acquisition or acquisitions of 30% or more of
                           TPR's voting stock by an outside entity or entities
                           (as defined below);

                  (ii)     a merger or consolidation of TPR, unless (1)
                           following the transaction, former stockholders of TPR
                           continue to hold at least 50% of the voting stock of
                           the surviving entity or (2) the transaction is
                           effected to implement a recapitalization in which no
                           outside entity or entities acquire control of 50% or
                           more of TPR's voting stock;

                  (iii)    during any period of two consecutive years,
                           individuals who at the beginning of such period were
                           members of the Board cease for any reason to
                           constitute at least a majority thereof (unless the
                           election, or the nomination for election by TPR's
                           stockholders, of each new director was approved by a
                           vote of at least two-thirds of the directors then
                           still in office who were directors at the beginning
                           of such period);

                  (iv)     a liquidation or dissolution of TPR, or a sale of
                           substantially all of its assets to an outside entity
                           or entities; or

                  (v)      the execution of a binding agreement which, if
                           consummated, would result in a Change in Control as
                           defined above (unless the agreement is terminated or
                           the transaction otherwise abandoned and the
                           Executive's employment does not terminate on or prior
                           to the termination or abandonment date);

                           provided, that, notwithstanding anything to the
                           contrary in the foregoing, neither the initial public
                           offering of the common stock of TPR, nor the
                           temporary holding of TPR securities by an underwriter
                           pursuant to an offering of such securities, shall be
                           deemed to constitute, or otherwise be treated as, a
                           Change in Control.

                           For purposes of this definition, an "outside entity"
                           includes any person or entity other than a TPR
                           Affiliate or any shareholder of a TPR Affiliate as of
                           September 1, 1998.

         (b)      TPR shall retain full and unlimited discretion to add to or to
                  dispose of TPR. However, if there is a Change in Control
                  during the term of the Agreement, the Executive will be
                  entitled to immediate vesting and settlement of all deferred
                  stock and stock options then held by the Executive under the
                  relevant plans, and of all other stock-based awards granted to
                  the Executive under any stock-based incentive plan of the TPR.

         (c)      For the purposes of this Agreement, the Executive will be
                  considered "Reassigned" following a Change in Control if any
                  of the following occur during
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                  the term of this Agreement:

                  (i)      a material detrimental change, unless agreed to by
                           the Executive, in his or her duties, reporting
                           responsibilities, or titles from those in effect
                           prior to the Change in Control;

                  (ii)     a substantial reduction in the Executive's benefits
                           under any TPR benefit and compensation plans in which
                           the Executive participated prior to the Change in
                           Control, or in the eligibility of the Executive for
                           such plans;

                  (iii)    the relocation of the Executive by more than 50 miles
                           from the office at which he or she was based prior to
                           the Change in Control, or, if the Executive consents
                           to relocation, the failure by TPR to pay the
                           Executive's reasonable moving expenses and indemnify
                           him or her against loss realized in the sale of his
                           or her principal residence in connection with the
                           relocation;

                  (iv)     TPR's failure to have any successor assume the
                           Agreement; or

                  (v)      any other material breach by TPR of the Agreement.

         (d)      If the Executive terminates employment after being Reassigned
                  by TPR after a Change in Control during the term of the
                  Agreement, the Executive will be entitled to receive the
                  payments and benefits described above in Sections 5(a) and
                  (c).

7.       Legal Stuff:

         (a)      Except for the right of TPR to seek equitable relief under the
                  circumstances provided by Section 2 hereof, any controversy,
                  dispute or claim arising under or relating to the provisions
                  of this Agreement, or the breach thereof, shall be determined
                  by arbitration in the City of New York in accordance with the
                  Commercial Arbitration Rules of the American Arbitration
                  Association then in effect. The decision and award in such
                  arbitration proceeding shall be binding and final on the
                  parties, and judgment upon the award rendered by the
                  arbitrator(s) may be entered in any court having jurisdiction
                  thereof.

         (b)      If any provision of the Agreement shall be found to be invalid
                  or unenforceable, that provision only shall be deemed to be
                  deleted, or revised to validly express the intention of the
                  parties, and the remainder of the Agreement, by intention of
                  the parties, shall remain valid and enforceable to the fullest
                  extent permitted by law.

         (c)      The Agreement is personal to the Executive and may not be
                  assigned by him or her. TPR may assign the Agreement to any
                  successor, or to any party or corporation that may succeed to
                  the business of TPR or of such successor by sale of assets,
                  merger, or consolidation or otherwise, provided the assignee
                  assumes the responsibilities and obligations of TPR under the
                  Agreement.

         (d)      TPR jointly and individually hereby agree to pay the Executive
                  the compensation due and payable to him or her pursuant to the
                  terms of this Agreement in the event TPR fails to do so. This
                  is provided that they are given written notice of default and
                  that they and each shall have the right to assert against the
                  Executive in any claim for compensation all defenses, set offs
                  and counterclaims that are, or would
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                  have been, available to TPR.

         (e)      The Agreement constitutes and contains the entire agreement
                  and understanding of the parties with respect to the subject
                  matter hereof. A modification of this Agreement will be
                  binding only if agreed to in writing by the party sought to be
                  bound or obligated.

         (f)      The Agreement shall be interpreted under the laws of the State
                  of New York.

         (g)      The Agreement may be executed in any number of identical
                  counterparts, and each counterpart shall be deemed a duplicate
                  original hereof.

         (h)      The CEO (except with respect to the CEO's employment
                  agreement, in which case the Board) shall administer this
                  Agreement and shall have exclusive authority and discretion to
                  interpret and construe the terms hereof and to determine the
                  Executive's eligibility for payments and benefits hereunder.
                  Any such determination will be final and binding on the
                  Executive unless arbitrary and capricious or made in bad
                  faith.

         (i)      Any payments due to the Executive hereunder will be reduced by
                  all applicable withholding and other taxes.<PAGE>   1
                                                                   Exhibit 10.12

                          STANDARD FORM OF OFFICE LEASE
                     THE REAL ESTATE BOARD OF NEW YORK, INC.

AGREEMENT OF LEASE, made as of this 23rd day of April, 1992 between 2316
BROADWAY REALTY CO., with offices at 440 Park Avenue South, New York, NY 10016
party of the first part, hereinafter referred to as LANDLORD, and PRINCETON
REVIEW, INC., a domestic corporation, presently located at 606 Columbus Avenue,
New York, NY 10025, party of the second part, hereinafter referred to as TENANT,

WITNESSETH: Landlord hereby leases to Tenant and Tenant hereby hires from
Landlord a portion of the third (3rd) floor as more particularly described in
the plan annexed hereto, in the building known as 2315 Broadway, New York, New
York 10024, in the Borough of Manhattan, City of New York, for the term of ten
(10) years (or until such term shall sooner cease and expire as hereinafter
provided) to commence on the 5th day of July nineteen hundred and ninety-two,
and to end on the 4th day of July two-thousand-two both dates inclusive, at an
minimum base rent as hereinafter provided.

which Tenant agrees to pay in lawful money of the United States which shall be
legal tender in payment of all debts and dues, public and private, at the time
of payment, in equal monthly installments in advance on the first day of each
month during said term, at the office of Landlord or such other place as
Landlord may designate, without any set off or deduction whatsoever, except that
Tenant shall pay the first _____ monthly installment(s) on the execution hereof
(unless this lease be a renewal).

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                  In the event that, at the commencement of the term of this
lease, or thereafter, Tenant shall be in default in the payment of rent to
Landlord pursuant to the terms of another lease with Landlord or with Landlord's
predecessor in interest, Landlord may at Landlord's option and without notice to
Tenant add the amount of such arrearages to any monthly installment of rent
payable hereunder and the same shall be payable to Landlord as additional rent.

                  The parties hereto, for themselves, their heirs, distributees,
executors, administrators, legal representatives, successors and assigns, hereby
covenant as follows:

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RENT OCCUPANCY:

1.       Tenant shall pay the rent as above and as hereinafter provided.

2.       Tenant shall use and occupy demised premises for general and executive
         offices and business activities related to the test preparatory and
         student membership organization and for no other purpose and related
         business.

ALTERATIONS:

3.       Tenant shall make no changes in or in the demised premises of any
         nature without Landlord's prior written consent. Subject to the prior
         written consent of Landlord, and to the provisions of this article.
         Tenant at Tenant's expense, may make alterations, installations,
         additions or improvements which are non-structural and which do not
         affect utility services or plumbing and electrical lines, in or to the
         interior of the demised premises by using contractors or mechanics
         first approved by Landlord. All fixtures and all paneling, partitions,
         railings and like installations, installed in the premises at any time,
         either by Tenant or by Landlord in Tenant's behalf, shall, upon
         installation, become the property of Landlord and shall remain upon and
         be surrendered with the demised premises unless Landlord, by notice to
         Tenant no later than twenty days prior to the date fixed as the
         termination of this lease, elects to relinquish Landlord's right
         thereto and to have them removed by Tenant, in which event, the same
         shall be removed from the premises by Tenant prior to the expiration of
         the lease, at Tenant's expense. Nothing in this article shall be
         construed to give Landlord title to or to prevent Tenant's removal of
         trade fixtures, moveable office furniture and equipment, but upon
         removal of any such from the premises or upon removal of other
         installations as may be required by Landlord, Tenant shall immediately
         and at its expense, repair and restore the premises to the condition
         existing prior to installation and repair any damage to the demised
         premises or the building due to such removal. All property permitted or
         required to be removed by Tenant at the end of the term remaining in
         the premises after Tenant's removal shall be deemed abandoned and may,
         at the election of Landlord, either be retained as Landlord's property
         or may be removed from the premises by Landlord at Tenant's expense.
         Tenant shall, before making any alterations, additions, installations
         or improvements, at its expense, obtain all permits, approvals and
         certificates required by any governmental or quasi-governmental bodies
         and (upon completion) certificates of final approval thereof and shall
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         deliver promptly duplicates of all such permits, approvals and
         certificates to Landlord and Tenant agrees to carry and will cause
         Tenant's contractors and sub-contractors to carry such workman's
         compensation, general liability, personal and property damage insurance
         as Landlord may require. If any mechanic's lien is filed against the
         demised premises, or the building of which the same forms a part, for
         work claimed to have been done for, or materials furnished to, Tenant,
         whether or not done pursuant to this article, the same shall be
         discharged by Tenant within ten days thereafter, at Tenant's expense,
         by filing the bond required by law.

REPAIRS:

4.       Landlord shall maintain and repair the public portions of the building,
         both exterior and interior. Tenant shall, throughout the term of this
         lease, take good care of the demises premises and the fixtures and
         appurtenances therein and at Tenant's sole cost and expense, make all
         non-structural repairs thereto as and when needed to preserve them in
         good working order and condition, reasonable wear and tear,
         obsolescence and damage from the elements, fire or other casualty,
         excepted. Notwithstanding the foregoing, all damage or injury to the
         demised premises or to any other part of the building, or to its
         fixtures, equipment and appurtenances, whether requiring structural or
         nonstructural repairs, caused by or resulting from carelessness,
         omissions, neglect or improper conduct of Tenant, Tenant's servants,
         employees, invitees or licensees, shall be repaired promptly by Tenant
         at is sole cost and expense, to the satisfaction of Landlord reasonably
         exercised. Tenant shall also repair all damage to the building and the
         demised premises caused by the moving of Tenant's fixtures, furniture
         or equipment. All the aforesaid repairs shall be of quality or class
         equal to the original work or construction. If Tenant fails after ten
         days' notice to proceed with due diligence to make repairs required to
         be made by Tenant, the same may be made by the Landlord at the expense
         of Tenant and the expenses thereof incurred by Landlord shall be
         collectible as additional rent after rendition of a bill or statement
         therefor. Tenant shall give Landlord prompt notice of any defective
         condition in any plumbing, heating system or electrical lines located
         in, servicing or passing through the demised premises and following
         such notice, Landlord shall remedy the condition with due diligence but
         at the expense of Tenant if repairs are necessitated by damage or
         injury attributable to Tenant, Tenant's servants, agents, employees,
         invitees or licensees as aforesaid. Except as specifically provided in
         Article 9 or
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         elsewhere in this lease, there shall be no allowance to Tenant for a
         diminution of rental value and no liability on the part of Landlord by
         reason of inconvenience, annoyance or injury to business arising from
         Landlord, Tenant or others making or failing to make any repairs,
         alterations, additions or improvements in or to any portion of the
         building or the demises premises or in and to the fixtures,
         appurtenances or equipment thereof. The provisions of this Article 4
         with respect to the making of repairs shall not apply in the case of
         fire or other casualty which are dealt with in Article 9 hereof.

WINDOW CLEANING:

5.       Tenant will not clean, nor require, permit, suffer or allow any window
         in the demised premises to be cleaned, from the outside in violation of
         Section 202 of the Labor Law or any other applicable law or of the
         rules of the Board of Standards and Appeals, or of any other board or
         body having or asserting jurisdiction.

REQUIREMENTS OF LAW,
FIRE INSURANCE, FLOOR
LOADS:

6.       Prior to the commencement of the lease term, if Tenant is then in
         possession, and at all times thereafter, Tenant, at Tenant's sole cost
         and expense, shall promptly comply with all present and future laws,
         orders and regulations of all state, federal, municipal and local
         governments, departments, commissions and boards and any direction of
         any public officer pursuant to law, and all orders, rules and
         regulations of the New York Board of Fire Underwriters or any similar
         body which shall impose any violation, order or duty upon Landlord or
         Tenant with respect to the demises premises whether or not arising out
         of Tenant's use or manner of use thereof, or with respect to the
         building if arising out of Tenant's use or manner of use of the
         premises or the building (including the use permitted under the lease).
         Nothing herein shall require Tenant to make structural repairs or
         alterations unless Tenant has by its manner of use of the demised
         premises or method of operation therein, violated any such laws,
         ordinances, orders, rules, regulations or requirements with respect
         thereto. Tenant may, after securing Landlord to Landlord's satisfaction
         against all damages, interest, penalties and expenses, including, but
         not limited to, reasonable attorneys' fees, by cash deposit or by
         surety bond in an amount and in a company satisfactory to Landlord,
         contest and appeal any such laws, ordinances, orders, rules,
         regulations or requirements provided same is done with all reasonable
         promptness and provided such appeal shall not subject Landlord to
         prosecution for a criminal offense or constitute a default under any
         lease or mortgage under which Landlord may
<PAGE>   6
         be obligated, or cause the demised premises or any part thereof to be
         condemned or vacated. Tenant shall not do or permit any act or thing to
         be done in or to the demised premises which is contrary to law, or
         which will invalidate or be in conflict with public liability, fire or
         other policies of insurance at any time carried by or for the benefit
         of Landlord with respect to the demised premises or the building of
         which the demised premises form a part, or which shall or might subject
         Landlord to any liability or responsibility to any person or for
         property damage, nor shall Tenant keep anything in the demised premises
         except as now or hereafter permitted by the Fire Department, Board of
         Fire Underwriters, Fire Insurance Rating Organization or other
         authority having jurisdiction, and then only in such manner and such
         quantity so as to not to increase the rate for fire insurance
         applicable to the building, nor use the premises in a manner which will
         increase the insurance rate for the building or any property located
         therein over that in effect prior to the commencement of Tenant's
         occupancy. Tenant shall pay all costs, expenses, fines, penalties, or
         damages, which may be imposed upon Landlord by reason of Tenant's
         failure to comply with the provisions of this article and if by reason
         of such failure the fire insurance rate shall, at the beginning of this
         lease or at any time thereafter, be higher than it otherwise would be,
         then Tenant shall reimburse Landlord, as additional rent hereunder, for
         that portion of all fire insurance premiums thereafter paid by Landlord
         which shall have been charged because of such failure by Tenant, and
         shall make such reimbursement upon the first day of the month following
         such outlay by Landlord. In any action or proceeding wherein Landlord
         and Tenant are parties a schedule or "make-up" of rate for the building
         or demised premises issued by the New York Fire Insurance Exchange, or
         other body making fire insurance rates applicable to said premises
         shall be conclusive evidence of the facts therein stated and of the
         several items and charges in the fire insurance rate then applicable to
         said premises. Tenant shall not place a load upon any floor of the
         demised premises exceeding the floor loan per square foot area which it
         was designed to carry and which is allowed by law. Landlord reserves
         the right to prescribe the weight and position of all safes, business
         machines and mechanical equipment. Such installations shall be placed
         and maintained by Tenant, at Tenant's expense, in settings sufficient,
         in Landlord's judgment, to absorb and prevent vibration, noise and
         annoyance.
<PAGE>   7

SUBORDINATION:

7.       This lease is subject and subordinate to all ground or underlying
         leases and to all mortgages which may now or hereafter affect such
         leases or the real property of which demised premises are a part and to
         all renewals, modifications, consolidations, replacements and
         exclusions of any such underlying leases and mortgages. This clause
         shall be self operative and no further instrument of subordination
         shall be required by any ground or underlying leases or by any
         mortgages affecting any lease or the real property of which the demised
         premises are a part. In confirmation of such subordination, Tenant
         shall execute promptly any certificate that Landlord may request.

PROPERTY - LOSS, DAMAGE,
REIMBURSEMENT,
INDEMNITY:

8.       Landlord or its agents shall not be liable for any damage to property
         of Tenant or of others entrusted to employees of the building, nor for
         loss of or damage to any property of Tenant by theft or otherwise, not
         for any injury or damage to persons or property resulting from any
         cause of whatsoever nature, unless caused by or due to the negligence
         of Landlord, its agents, servants or employees; nor shall Landlord or
         its agents be liable for any such damage caused by other Tenants or
         persons in, upon or about said building or caused by operations in
         construction of any private, public or quasi public work. If at any
         time any windows of the demised premises are temporarily closed,
         darkened, or bricked up (or permanently closed, darkened or broken up,
         if required by law) for any reason whatsoever including, but not
         limited to Landlord's own acts, Landlord shall not be liable for any
         damage Tenant may sustain thereby and Tenant shall not be entitled to
         any compensation therefor nor abatement or diminution of rent nor shall
         the same release Tenant from its obligations hereunder nor constitute
         an eviction. Tenant shall not move any safe, heavy machinery, heavy
         equipment, bulky matter or fixtures into or out of the building without
         Landlord's prior written consent. If such safe, machinery, equipment,
         bulky matter or furniture requires special handling, all work in
         connection therewith shall comply with the Administrative Code of the
         City of New York and all other laws and regulations applicable thereto
         and shall be done during such hours as Landlord may designate. Tenant
         shall indemnify and save harmless Landlord against and from all
         liabilities, obligations, damages, penalties, claims, costs and
         expenses for which Landlord shall not be reimbursed by insurance,
         including reasonable attorneys' fees, paid, suffered or incurred as a
         result of any breach by Tenant, Tenant's agents, contractors,
         employees, invitees or licensees
<PAGE>   8
         of any covenant or condition of this lease, or the carelessness,
         negligence or improper conduct of the Tenant, Tenant's agents,
         contractors, employees, invitees or licensees. Tenant's liability under
         this lease extends to the acts and omissions of any subTenant and any
         agent, contractor, employee invitee or licensee of any subTenants, in
         case any action or proceeding is brought against Landlord by reason of
         any such claim. Tenant upon written notice from Landlord, will at
         Tenant's expense, resist or defend such action or proceeding by counsel
         approved by Landlord in writing such approval not to be unreasonably
         withheld. [FN) RIDER TO BE ADDED IF NECESSARY.]

DESTRUCTION, FIRE AND
OTHER CASUALTY:

9.       (a) If the demised premises or any part thereof shall be damaged by
         fire or other casualty, Tenant shall give immediate notice thereof to
         Landlord and this lease shall continue in full force and effect except
         as hereinafter set forth. (b) If the demised premises are partially
         damaged or rendered partially unusable by fire or other casualty, the
         damages thereto shall be repaired by and at the expense of Landlord and
         the rent, until such repair shall be substantially completed, shall be
         apportioned from the day following the casualty according to the part
         of the premises which is usable. (c) If the demised premises are
         totally damaged or rendered wholly unusable by fire or other casualty,
         then the rent shall be proportionately paid up to the time of the
         casualty and thenceforth shall cease until the date when the premises
         shall have been repaired and restored by Landlord, subject to
         Landlord's right to elect not to restore the same as hereinafter
         provided. (d) If the demised premises are rendered wholly unusable or
         (whether or not the demised premises are damaged in whole or in part)
         if the building shall be so damaged that Landlord shall decide to
         demolish it or to rebuild it, then, in any of such events, Landlord may
         elect to terminate this lease by written notice to Tenant given within
         90 days after such fire or casualty specifying a date for the
         expiration of the lease, which date shall not be more than 60 days
         after the giving of such notice, and upon the date specified in such
         notice the term of this lease shall expire as fully and completely as
         if such date were the date set forth above for the termination of this
         lease and Tenant shall forthwith quit, surrender and vacate the
         premises without prejudice however, to Landlord's rights and remedies
         against Tenant under the lease provisions in effect prior to such
         termination, and any rent owing shall be paid up to such date and any
         payments of rent made by Tenant which were on account of any period
         subsequent to such date shall be returned
<PAGE>   9
         to Tenant. Unless Landlord shall serve a termination notice as provided
         for herein, Landlord shall make the repairs and restorations under the
         conditions of (b) and (c) hereof, with all reasonable expedition
         subject to delays due to adjustment of insurance claims, labor troubles
         and causes beyond Landlord's control. After any such casualty, Tenant
         shall cooperate with Landlord's restoration by removing from the
         premises as promptly as reasonably possible, all of Tenant's
         salvageable inventory and movable equipment, furniture, and other
         property. Tenant's liability for rent shall resume five (5) days after
         written notice from Landlord that the premises are substantially ready
         for Tenant's occupancy. (e) Nothing contained hereinabove shall relieve
         Tenant from liability that may exist as a result of damage from fire or
         other casualty. Notwithstanding the foregoing, each party shall look
         first to any insurance in its favor before making any claim against the
         other party for recovery for loss or damage resulting from fire or
         other casualty, and to the extent that such insurance is in force and
         collectible and to the extent permitted by law, Landlord and Tenant
         each hereby releases and waives all right of recovery against the other
         or any one claiming through or under each of them by way of subrogation
         or otherwise. The foregoing release and waiver shall be in force only
         if both releasors' insurance policies contain a clause providing that
         such a release or waiver shall not invalidate the insurance and also,
         provided that such a policy can be obtained without additional
         premiums. Tenant acknowledges that Landlord will not carry insurance on
         Tenant's furniture and/or furnishings or any fixtures or equipment,
         improvements, or add appurtenances removable by Tenant and agrees that
         Landlord will not be obligated to repair any damage thereto or replace
         the same. (f) Tenant hereby waives the provisions of Section 227 of the
         Real Property Law and agrees that the provisions of this article shall
         govern and control in lieu thereof.

EMINENT DOMAIN:

10.      If the whole or any part of the demised premises shall be acquired or
         condemned by Eminent Domain for any public or quasi public use or
         purpose, then and in that event, the term of this lease shall cease and
         terminate from the date of title vesting in such proceeding and Tenant
         shall have no claim for the value of any unexpired term of said lease.

ASSIGNMENT, MORTGAGE,
ETC.

11.      Tenant, for itself, its heirs, distributees, executors, administrators,
         legal representatives, successors and assigns, expressly covenants that
         it shall not assign, mortgage or
<PAGE>   10
         encumber this agreement nor underlet, or suffer or permit the demised
         premises or any part thereof to be used by others without the prior
         written consent of Landlord in each instance. If this lease is
         assigned, or if the demised premises or any part thereof be underlet or
         occupied by anybody other than Tenant, Landlord may, after default by
         Tenant collect rent from the assignee; under Tenant or occupant and
         apply the net amount collected to the sum herein received, but no such
         assignment, underletting occupancy or collection shall be deemed a
         waiver of this covenant or the acceptance of the assignee, under Tenant
         or occupant as Tenant, or a release of Tenant from the further
         performance by Tenant of covenants on the part of Tenant herein
         contained. The consent by Landlord to an assignment or underletting
         shall not in any wise be construed to relieve Tenant from obtaining the
         express consent in writing of Landlord in any further assignment or
         underletting.

ELECTRIC CURRENT:

12.      Rates and conditions in respect to submetering or rent inclusion, as
         the case may be, to be added in RIDER attached hereto. Tenant covenants
         and agrees that at all times its use of electric current shall not
         exceed the capacity of existing feeders to the building or the risers
         or wiring installations and Tenant may not use any electrical equipment
         which, in Landlord's opinion, reasonably exercised, will overload such
         installations or interfere with the use thereof by other Tenants of the
         building. The change at any time of the character of electric service
         shall in no wise make Landlord liable or responsible to Tenant, for any
         loss, damages or expenses which Tenant may sustain.

ACCESS TO PREMISES:

13.      Landlord or Landlord's agents shall have the right (but shall not be
         obligated) to enter the demised premises in any emergency at any time,
         and, at other reasonable times, to examine the same and to make such
         repairs, replacements and improvements as Landlord may deem necessary
         and reasonably desirable to the demised premises or to any other
         portion of the building of which Landlord may elect to perform
         following Tenant's failure to make repairs or perform any work which
         Tenant is obligated to perform under this lease, or for the purpose of
         complying with laws, regulations and other directions of governmental
         authorities. Tenant shall permit Landlord to use and maintain and
         replace pipes and conduits in and through the demised premises and to
         erect new pipes and conduits therein. Landlord may, during the progress
         of any work in the demised premises, take all necessary materials and
<PAGE>   11
         equipment into said premises without the same constituting an eviction
         nor shall the Tenant be entitled to any abatement of rent while such
         work is in progress nor to any damages by reason of loss or
         interruption of business or otherwise. Throughout the term hereof
         Landlord shall have the right to enter the demised premises at
         reasonable hours for the purpose of showing the same to prospective
         purchasers or mortgagees of the building, and during the last six
         months of the term for the purpose of showing the same to prospective
         Tenants and may, during said six months period, place upon the premises
         the usual notices "To Let" and "For Sale" which notices Tenant shall
         permit to remain thereon without molestation. If Tenant is not present
         to open and permit an entry into the premises, Landlord or its agents
         may enter the same whenever such entry may be necessary or permissible
         by master key or forcibly and provided reasonable care is exercised to
         safeguard Tenant's property and such entry shall not render Landlord or
         its agents liable therefor, nor in any event shall the obligations of
         Tenant hereunder be affected. If during the last month of the term
         Tenant shall have removed all or substantially all of Tenant's property
         therefrom, Landlord may immediately enter, alter, renovate or
         redecorate the demised premises without limitation or abatement of
         rent, or incurring liability to Tenant for any compensation and such
         act shall have no effect on this lease or Tenant's obligations
         hereunder. Landlord shall have the right at any time, without the same
         constituting an eviction and without incurring liability to Tenant
         therefor to change the arrangement and/or location of public entrances,
         passageways, doors, doorways, corridors, elevators, stairs, toilets, or
         other public parts of the building and to change the name, number or
         designation by which the building may be known.

VAULT, VAULT SPACE,
AREA:

14.      No Vaults, vault space or area, whether or not enclosed or covered, not
         within the property line of the building is leased hereunder, anything
         contained in or indicated on any sketch, blue print or plan or anything
         contained elsewhere in this lease to the contrary notwithstanding.
         Landlord makes no representation as to the location of the property
         line of the building. All vaults and vault space and all such areas not
         within the property line of the building, which Tenant may be permitted
         to use and/or occupy, is to be used and/or occupied under a revocable
         license, and if any such license be revoked, or if the amount of such
         space or area be diminished or required by any federal, state or
         municipal authority or public utility, Landlord shall not be subject to
         any liability nor shall
<PAGE>   12
         Tenant be entitled to any compensation or diminution or abatement of
         rent, nor shall such revocation, diminution or requisition be deemed
         constructive or actual eviction. Any tax, fee or charge of municipal
         authorities for such vault or area shall be paid by Tenant.

OCCUPANCY:

15.      Tenant will not at any time use or occupy the demised premises in
         violation of the certificate of occupancy issued for the building of
         which demised premises are a part. Tenant has inspected the premises
         and accepts them as is, subject to the riders annexed hereto with
         respect to Landlord's work, if any. In any event, Landlord makes no
         representation as to the condition of the premises and Tenant agrees to
         accept the same subject to violations whether or not of record.

BANKRUPTCY:

16.      (a) Anything elsewhere in this lease to the contrary notwithstanding,
         this lease may be cancelled by Landlord by the sending of a written
         notice to Tenant within a reasonable time after the happening of any
         one or more of the following events: (1) the commencement of a case in
         bankruptcy or under the laws of any state naming Tenant as the debtor;
         or (2) the making by Tenant of an assignment or any other arrangement
         for the benefit of creditors under any state statute. Neither Tenant
         nor any person claiming through or under Tenant, or by reason of any
         statute or order of court, shall thereafter be entitled to possession
         of the premises demised but shall forthwith quit and surrender the
         premises. If this lease shall be assigned in accordance with its terms,
         the provisions of this Article 16 shall be applicable only to the party
         then owning Tenant's interest in this lease.

         (b) It is stipulated and agreed that in the event of the termination of
         this lease pursuant to (a) hereof, Owner shall forthwith,
         notwithstanding any other provisions of this lease to the contrary, be
         entitled to recover from Tenant as and for liquidated damages an amount
         equal to the difference between the rent reserved hereunder for the
         unexpired portion of the term demised and the fair and reasonable
         rental value of the demised premises for the same period. In the
         computation of such damages the difference between any installment of
         rent becoming due hereunder after the date of termination and the fair
         and reasonable rental value of the demised premises for the period for
         which such installment was payable shall be discounted to the date of
         termination at the rate of four per cent (4%) per annum. If such
         premises or any part thereof be relet
<PAGE>   13
         by the Owner for unexpired term of said lease, or any part thereof,
         before presentation of proof of such liquidated damages to any court,
         commission or tribunal, the amount of rent reserved upon such reletting
         shall be deemed to be the fair and reasonable rental value for the part
         or the whole of the premises so re-let during the term of the
         re-letting. Nothing herein contained shall limit or prejudice the right
         of the Owner to prove for and obtain as liquidated damages by reason of
         such termination, an amount equal to the maximum allowed by any statute
         or rule of law in effect at the time when, and governing the
         proceedings in which, such damages are to be proved, whether or not
         such amount be greater, equal to, or less than the amount of the
         difference referred to above.

DEFAULT:

17.      (1) If Tenant defaults in fulfilling any of the covenants of this lease
         other than the covenants for the payment of rent or additional rent; or
         if the demised premises become vacant or deserted; or if the demised
         premises are damaged by reason of negligence or carelessness of Tenant,
         it's agent, employees or invitees or if any executive or attachment
         shall be issued against Tenant or any of Tenant's property whereupon
         the demised premises shall be taken or occupied by someone other than
         Tenant; or if Tenant shall make default with respect to any other lease
         between Landlord and Tenant; or if Tenant shall fail to move into or
         take possession of the premises within fifteen (15) days after the
         commencement of the term of this lease, of which fact Landlord shall be
         the sole judge; then, in any one or more of such events, upon Landlord
         serving a written five (5) days, notice upon Tenant specifying the
         nature of said default and upon the expiration of said five (5) days,
         if Tenant shall have failed to comply with or remedy such default, or
         if the said default or omission complained of shall be of a nature that
         the same cannot be completely cured or remedied within said five (5)
         day period, and if Tenant shall not have diligently commenced curing
         such default within such five (5) day period, and shall not thereafter
         with reasonable diligence and in good faith proceed to remedy or cure
         such default, then Landlord may serve a written three (3) days' notice
         of cancellation of this lease upon Tenant, and upon the expiration of
         said three (3) days this lease and the term thereunder shall end and
         expire as fully and completely as if the expiration of such three (3)
         day, period were the day herein definitely fixed for the end and
         expiration of this lease and the term thereof and Tenant shall then
         quit and surrender the demised premises to Landlord but Tenant shall
         remain liable as
<PAGE>   14
         hereinafter provided.

         (2) If the notice provided for in (1) hereof shall have been given, and
         the term shall expire as aforesaid; or if Tenant shall make default in
         the payment of the rent reserved herein or any item of additional rent
         herein mentioned or any part of either or in making any other payment
         herein mentioned or any part of either or in making any other payment
         herein required; then and in any of such events Landlord may without
         notice, re-enter the demised premises either by force or otherwise, and
         dispossess Tenant by summary proceedings or otherwise, and the legal
         representative of Tenant or other occupant of demised premises and
         remove their effects and hold the premises as if this lease had not
         been made, and Tenant hereby waives the service of notice of intention
         to re-enter or to institute legal proceedings to that end. If Tenant
         shall make default hereunder prior to the date fixed as the
         commencement of any renewal or extension of this lease, Landlord may
         cancel and terminate such renewal or extension agreement by written
         notice.

REMEDIES OF LANDLORD
AND WAIVER OF
REDEMPTION:

18.      In case of any such default, re-entry, expiration and/or dispossess by
         summary proceedings or otherwise, (a) the rent shall become due
         thereupon and be paid up to the time of such re-entry, dispossess
         and/or expiration, together with such expenses as Landlord may incur
         for legal expenses, attorneys' fees, brokerage, and/or putting the
         demised premises in good order, or for preparing the same for
         re-rental; (b) Landlord may re-let the premises or any part or parts
         thereof, either in the name of Landlord or otherwise, for a term or
         terms, which may at Landlord's option be less than or exceed the period
         which would otherwise have constituted the balance of the term of this
         lease and may grant concessions or free rent or charge a higher rental
         than that in this lease, and /or (c) Tenant or the legal
         representatives of Tenant shall also pay Landlord as liquidated damages
         for the failure of Tenant to observe and perform said Tenant's
         covenants herein contained, any deficiency between the rent hereby
         reserved and/or covenanted to be paid and the net amount, if any, of
         the rents collected on account of the lease or leases of the demised
         premises for each month of the period which would otherwise have
         constituted the balance of the term of this lease. The failure of
         Landlord to re-let the premises or any part or parts thereof shall not
         release or affect Tenant's liability for damages. In computing such
         liquidated damages there shall be added to the said deficiency
<PAGE>   15
         such expenses as Landlord may incur in connection with re-letting such
         as legal expenses, attorneys' fees, brokerage, advertising and for
         keeping the demised premises in good order or for preparing the same
         for re-letting. Any such liquidated damages shall be paid in monthly
         installments by Tenant on the rent day specified in this lease and any
         suit brought to collect the amount of the deficiency for any month
         shall not prejudice in any way the rights of Landlord to collect the
         deficiency for any subsequent month by a similar proceeding. Landlord,
         in putting the demised premises in good order or preparing the same for
         re-rental may, at Landlord's option, make such alterations, repairs,
         replacements, and/or decorations in the demised premises as Landlord,
         in Landlord's sole judgment, considers advisable and necessary for the
         purpose of re-letting the demised premises, and the making of such
         alterations, repairs, replacements, and/or decorations shall not
         operate or be construed to release Tenant from liability hereunder as
         aforesaid. Landlord shall in no event be liable in any way whatsoever
         for failure to re-let the demised premises, or in the event that the
         demised premises are re-let, for failure to collect rent thereof under
         such re-letting, and in no event shall Tenant be entitled to receive
         any excess, if any, of such net rent collected over the sums payable by
         Tenant to Landlord hereunder. In the event of a breach or threatened
         breach by Tenant of any of the covenants or provisions hereof, Landlord
         shall have the right of injunction and the right to invoke any remedy
         allowed at law or in equity as if re-entry, summary proceedings and
         other remedies were not herein provided for. Mention in this lease of
         any particular remedy, shall not preclude Landlord from any other
         remedy, in law or in equity. Tenant hereby expressly waives any and all
         rights of redemption granted by or under any present or future laws in
         the event of Tenant being evicted or dispossessed for any cause, or in
         the event of Landlord obtaining possession of demised premises, by
         reason of the violation by Tenant of any of the covenants and
         conditions of this lease, or otherwise.

FEES AND EXPENSES:

19.      If Tenant shall default in the observance or performance of any term or
         covenant on Tenant's part to be observed or performed under or by
         virtue of any of the terms or provisions in any article of this lease,
         then, unless otherwise provided elsewhere in this lease, Landlord may
         immediately or at any time thereafter and without notice perform the
         obligation of Tenant thereunder, and if Landlord, in connection
         therewith or in connection with any default by Tenant in the covenant
         to pay
<PAGE>   16
         rent hereunder, makes any expenditures or incurs any obligations for
         the payment of money, including but not limited to attorneys' fees, in
         instituting, prosecuting or defending any action or proceeding, such
         sums so paid or obligations incurred with interest and costs shall be
         deemed to be additional rent hereunder and shall be paid by Tenant to
         Landlord within five (5) days of rendition of any bill or statement to
         Tenant therefore, and if Tenant's lease term shall have expired at the
         time of making of such expenditures or incurring of such obligations,
         such sums shall be recoverable by Landlord as damages.

NO REPRESENTATIONS BY
LANDLORD:

20.      Neither Landlord nor Landlord's agents have made any representations or
         promises with respect to the physical condition of the building, the
         land upon which it is erected or the demised premises, the rents,
         leases, expenses of operation or any other matter or thing affecting or
         related to the premises except as herein expressly set forth and no
         rights, easements or licenses are acquired by Tenant by implication or
         otherwise except as expressly set forth in the provisions of this
         lease. Tenant has inspected the building and the demised premises and
         is thoroughly acquainted with their condition, and agrees to take the
         same "as is" and acknowledges that the taking of possession of the
         demised premises by Tenant shall be conclusive evidence that the said
         premises and the building of which the same form a part were in good
         and satisfactory condition at the time such possession was so taken,
         except as to latent defects. All understandings and agreements
         heretofore made between the parties hereto are merged in this contract,
         which alone fully and completely expresses the agreement between
         Landlord and Tenant and any executory agreement hereafter made shall be
         ineffective to change, modify, discharge or effect an abandonment of it
         in whole or in part, unless such executory agreement is in writing and
         signed by the party against whom enforcement of the change,
         modification, discharge or abandonment is sought.

END OF TERM:

21.      Upon the expiration or other termination of the term of this lease,
         Tenant shall quit and surrender to Landlord the demised premises, broom
         clean, in good order and condition, ordinary wear excepted, and Tenant
         shall remove all its property. Tenant's obligation to observe or
         perform its covenant shall survive the expiration or other termination
         of this lease. If the last day of the term of this lease or any renewal
         thereof, falls on Sunday, this lease shall expire at noon on the
         preceding
<PAGE>   17
         Saturday unless it be a legal holiday in which case it shall expire at
         noon on the preceding business day.

QUIET OF ENJOYMENT:

22.      Landlord covenants and agrees with Tenant that upon Tenant paying the
         rent and additional rent and observing and performing all the terms,
         covenants and conditions, on Tenant's part to be observed and
         performed, Tenant may peaceably and quietly enjoy the premises hereby
         demised, subject, nevertheless, to the terms and conditions of this
         lease including, but not limited to, Article 30 hereof and to the
         ground leases, underlying leases and mortgages hereinbefore mentioned.

FAILURE TO GIVE
POSSESSION:

23.      If Landlord is unable to give possession of the demised premises on the
         date of the commencement of the term hereof, because of the
         holding-over or retention of possession of any Tenant, underTenant or
         occupants, or if the premises are located in a building being
         constructed, because such building has not been sufficiently completed
         to make the premises ready for occupancy or because of the fact that a
         certificate of occupancy has not been procured or for any other reason,
         Landlord shall not be subject to any liability for failure to give
         possession on said date and the validity of the lease shall not be
         impaired under such circumstances, nor shall the same be construed in
         any wise to extend the term of this lease, but the rent payable
         hereunder shall be abated (provided Tenant is not responsible for the
         inability to obtain possession) until after Landlord shall have given
         Tenant written notice that the premises are substantially ready for
         Tenant's occupancy. If permission is given to Tenant to enter into the
         possession of the demised premises or to occupy the premises other than
         the demised premises prior to the date specified as the commencement of
         the term of this lease, Tenant covenants and agrees that such occupancy
         shall be deemed to be under all the terms, covenants, conditions and
         provisions of this lease, except as to the covenant to pay rent. The
         provisions of this article are intended to constitute "an express
         provision to the contrary" within the meaning of Section 223-a of the
         New York Real Property Law.

NO WAIVER:

24.      The failure of Landlord to seek redress for violation of, or to insist
         upon the strict performance of any covenant or condition of this lease
         or of any of the Rules or Regulations set forth or hereafter adopted by
         Landlord, shall not prevent a subsequent act which would have
         originally constituted a violation from
<PAGE>   18
         having all the force and effect of an original violation. The receipt
         by Landlord of rent with knowledge of the breach of any covenant of
         this lease shall not be deemed a waiver of such breach and no provision
         of this lease shall be deemed to have been waived by Landlord unless
         such waiver be in writing signed by Landlord. No payment by Tenant or
         receipt by Landlord of a lesser amount than the monthly rent herein
         stipulated shall be deemed to be other than on account of the earliest
         stipulated rent, nor shall any endorsement or statement of any check or
         any letter accompanying any check or payment as rent be deemed an
         accord and satisfaction, and Landlord may accept such check or payment
         without prejudice to Landlord's right to recover the balance of such
         rent or pursue any other remedy in this lease provided. No act or thing
         done by Landlord or Landlord's agents during the term hereby demised
         shall be deemed an acceptance of a surrender of said premises and no
         agreement to accept such surrender shall be valid unless in writing
         signed by Landlord. No employee of Landlord or Landlord's agent shall
         have any power to accept the keys of said premises prior to the
         termination of the lease and the delivery of keys to any such agent or
         employee shall not operate as a termination of the lease or a surrender
         of the premises.

WAIVER OF TRIAL BY JURY:

25.      It is mutually agreed by and between Landlord and Tenant that the
         respective parties hereto shall and they hereby do waive trial by jury
         in any action, proceeding or counterclaim brought by either of the
         parties hereto against the other (except for personal injury or
         property damage) on any matters whatsoever arising out of or in any way
         connected with this lease, the relationship of Landlord and Tenant,
         Tenant's use of or occupancy of said premises, and any emergency
         statutory or any other statutory remedy. It is further mutually agreed
         that in the event Landlord commences any summary proceeding for
         possession of the premises, Tenant will not interpose any counterclaim
         of whatever nature or description in any such proceeding. [FN RIDER TO
         BE ADD IF NECESSARY]

INABILITY TO PERFORM:

26.      This lease and the obligation of Tenant to pay rent hereunder and
         perform all of the other covenants and agreements hereunder on part of
         Tenant to be performed shall in no wise be affected, impaired or
         excused because Landlord is unable to fulfill any of is obligations
         under this lease to supply or is delayed in supplying any service
         expressly or impliedly to be supplied or is unable to make, or is
         delayed in making any
<PAGE>   19
         repair, additions, alterations or decorations or is unable to supply or
         is delayed in supplying any equipment or fixtures if Landlord is
         prevented or delayed from so doing by reason of strike or labor
         troubles or any cause whatsoever including, but not limited to,
         government preemption in connection with a National Emergency or by
         reason of any rule, order or regulation of any department or
         subdivision thereof of any government agency or by reason of the
         conditions of supply and demand which have been or are affected by war
         or other emergency.

BILLS AND NOTICES:

27.      Except as otherwise in this lease provided, a bill, statement, notice
         or communication which Landlord may desire to be required to give to
         Tenant, shall be deemed sufficiently given or rendered if, in writing,
         delivered to Tenant personally or sent by registered or certified mail
         addressed to Tenant at the building of which the demised premises form
         a part or at the last known residence address or business address of
         Tenant or left at any of the aforesaid premises addressed to Tenant,
         and the time of the rendition of such bill or statement and of the
         giving of such notice of communication shall be deemed to be the time
         when the same is delivered to Tenant, mailed or left at the premises as
         herein provided. Any notice by Tenant to Landlord must be served by
         registered or certified mail addressed to Landlord at the address first
         hereinabove given or at such other address as Landlord shall designate
         by written notice.

SERVICES PROVIDED BY
LANDLORD - WATER,
ELEVATORS, HEAT,
CLEANING, AIR
CONDITIONING:

28.      As long as Tenant is not in default under any of the covenants of this
         lease, Landlord shall provide: (a) necessary elevator facilities on
         business days from 8 a.m. to 6 p.m. and on Saturdays from 8 a.m. to 1
         p.m. and have one elevator subject to call at all other times; (b) heat
         to the demised premises when and as required by law, on business days
         from 8 a.m. to 6 p.m. and on Saturdays from 8 a.m. to 1 p.m.; (c) water
         for ordinary lavatory purposes, but if Tenant uses or consumes water
         for any other purposes or in unusual quantities (of which fact Landlord
         shall be the sole judge), Landlord may install a water meter at
         Tenant's expense which Tenant shall thereafter maintain at Tenant's
         expense in good working order and repair to register such water
         consumption and Tenant shall pay for water consumed as shown on said
         meter as additional rent as and when bills are rendered, and on
         Tenant's default in making such payment. Landlord may pay such charges
         and collect the same from Tenant. Such a meter shall also be installed
         and
<PAGE>   20
         maintained at Tenant's expense if required by Law or Governmental
         Order. Tenant, if a water meter is so installed, covenants and agrees
         to pay its proportionate share of the sewer rent and all other rents
         and charges which are now or hereafter assessed, imposed or may become
         a lien on the demised premises or the realty of which they are a part;
         (d) cleaning service for the demised premises on business days at
         Landlord's expense, provided that the same are kept in order by Tenant.
         However, said premises are to be kept clean by Tenant, it shall be done
         at Tenant's sole expense, in a manner satisfactory to Landlord and no
         one other than persons approved by Landlord shall be permitted to enter
         said premises or the building of which they are a part for such
         purpose. Tenant shall pay Landlord the cost of removal of any of
         Tenant's refuse and rubbish from the building. (e) Rider to be added in
         respect to rates and conditions for air conditioning/cooling and
         ventilation if the entire building in which the demised premises are
         located is serviced by a central air conditioning/cooling and
         ventilating system. If applicable, air conditioning/cooling will be
         furnished from May 15 through September 30th on business days (Mondays
         through Fridays, holidays excepted) from 8:00 a.m. to 6:00 p.m. and
         ventilation will be furnished on business days during the aforesaid
         hours except when air conditioning/cooling is being furnished as
         aforesaid. If Tenant requires air conditioning/cooling or ventilation
         for more extended hours or on Saturdays, Sundays or on holidays, as
         defined under Landlord's contract with Operating Engineers Local
         94-94A. Landlord will furnish the same at Tenant's expense. (f)
         Landlord shall have no responsibility or liability for failure to
         supply the services agreed to herein. Landlord reserves the right to
         stop services of the heating, elevators, plumbing, air-conditioning,
         power systems or cleaning or other services, if any, when necessary by
         reason of accident or for repairs, alterations, replacements or
         improvements necessary or desirable in the judgment of Landlord for as
         long as may be reasonably required by reason thereof or by reason of
         strikes, accidents, laws, order or regulations or any other reason
         beyond the control of Landlord. If the building of which the demised
         premises are a part supplies manually-operated elevator service,
         Landlord at any time may substitute automatic-control elevator service
         and upon ten days' written notice to Tenant, proceed with alterations
         necessary therefor without in any wise affecting this lease or the
         obligations of Tenant hereunder. The same shall be done with a minimum
         of
<PAGE>   21
         inconvenience to Tenant and Landlord shall pursue the alteration with
         due diligence.

CAPTIONS:

29.      The Captions are inserted only as a matter of convenience and for
         reference and in no way define, limit or describe the scope of this
         lease nor the intent of any provision thereof.

DEFINITIONS:

30.      The term "office", or "offices", wherever used in this lease, shall not
         be construed to mean premises used as a store or stores, for the sale
         or display, at any time, of goods, wares or merchandise, of any kind,
         or as a restaurant, shop, booth, bootblack or other stand, barber shop,
         or for other similar purposes or for manufacturing. The term "Landlord"
         as used in this lease means only the owner, or the mortgagee in
         possession, for the time being of the land and building, (or the owner
         of a lease of the building, or of the land and building) of which the
         demised premises form a part, so that in the event of any sale or sales
         of said land and building or of said lease, or in the event of a lease
         of said building, or of the land and building, the said Landlord shall
         be and hereby is entirely freed and relieved of all covenants and
         obligations of Landlord hereunder, and it shall be deemed and construed
         without further agreement between the parties or their successors in
         interest, or between the parties and the purchaser, at any such sale,
         or the said lessee of the building, or of the land and building, that
         the purchaser or the lessee of the building has assumed and agreed to
         carry out any and all covenants and obligations of Landlord, hereunder.
         The words "re-enter" and "re-entry" as used in this lease are not
         restricted to their technical legal meaning. The term "business days"
         as used in this lease shall exclude Saturdays (except such portion
         thereof as is covered by specific hours in Article 28 hereof). Sundays
         and all days observed by the State or Federal Government as legal
         holidays and those designated as holidays by the applicable building
         service union employees service contract or by the applicable Operating
         Engineers contract with respect to HVAC service.

ADJACENT EXCAVATION
SHARING:

31.      If an excavation shall be made upon land adjacent to the demised
         premises, or shall be authorized to be made, Tenant shall afford to the
         person causing or authorized to cause such excavation, license to enter
         upon the demised premises for the purpose of doing such work as said
         person shall deem necessary to preserve the wall or the building of
         which demised premises form a part from injury or damage and to
<PAGE>   22
         support the same by proper foundations without any claim for damages or
         indemnity against Landlord, or diminution or abatement of rent.

RULES AND REGULATIONS:

32.      Tenant and Tenant's servants, employees, agents, visitors, and
         licensees shall observe faithfully, and comply strictly with, the Rules
         and Regulations and such other and further reasonable Rules and
         Regulations as Landlord or Landlord's agents may from time to time
         adopt. Notice of any additional Rules or Regulations shall be given in
         such manner as Landlord may elect. In case Tenant disputes the
         reasonableness of any additional Rule or Regulation hereafter made or
         adopted by Landlord or Landlord's agents, the partners hereto agree to
         submit the question of the reasonableness of such Rule or Regulation
         for decision to the New York office of the American Arbitration
         Association, whose determination shall be final and conclusive upon the
         parties hereto. The right to dispute the reasonableness of any
         additional Rule or Regulation upon Tenant's part shall be deemed waived
         unless the same shall be asserted by service of a notice, in writing
         upon Landlord within ten (10) days after the giving of notice thereof.
         Nothing in this lease contained shall be construed to impose upon
         Landlord any duty or obligation to enforce the Rules and Regulations or
         terms, covenants or conditions in any other lease, as against any other
         Tenant and Landlord shall not be liable to Tenant for violation of the
         sums by any other Tenant, its servants, employees, agents, visitors or
         Licensees.

SECURITY:

33.      Tenant has deposited with Landlord the sum of $13,333.33 as security
         for the faithful performance and observance by Tenant of the terms,
         provisions and conditions of this lease: it is agreed that in the event
         Tenant defaults in respect of any of the terms, provisions and
         conditions of this lease, including, but not limited to, the payment of
         rent and additional rent. Landlord may use, apply or retain the whole
         or any part of the security so deposited to the extent required for the
         payment of any rent and additional rent or any other sum as to which
         Tenant is in default or for any sum which Landlord may expend or may be
         required to expend by reason of Tenant's default in respect of any of
         the terms, covenants and conditions of this lease, including but not
         limited to, any damages or deficiency in the reletting of the premises,
         whether such damages or deficiency accrued before or after summary
         proceedings or other re-entry by Landlord. In the event that Tenant
         shall fully and faithfully comply with all of the terms,
<PAGE>   23
         provisions, covenants and conditions of this lease, the security shall
         be returned to Tenant after the date fixed as the end of the Lease and
         after delivery of entire possession of the demised premises to
         Landlord. In the event of a sale of the land and building or leasing of
         the building, of which the demised premises form a part, Landlord shall
         have the right to transfer the security to the vendee or lessee and
         Landlord shall thereupon be released by Tenant from all liability for
         the return of such security; and Tenant agrees to look to the new
         Landlord solely for the return of said security, and it is agreed that
         the provisions hereof shall apply to every transfer or assignment made
         of the security to a new Landlord. Tenant further covenants that it
         will not assign or encumber or attempt to assign or encumber the monies
         deposited herein as security and that neither Landlord nor its
         successors or assigns shall be bound by any such assignment,
         encumbrance, attempted assignment or attempted encumbrance.

  SUCCESSORS AND
  ASSIGNEE:

         34.      The covenants, conditions and agreements contained in this
                  lease shall bind and inure to the benefit of Landlord and
                  Tenant and their respective heirs, distributors, executors,
                  administrators, successors, and except as otherwise provided
                  in this lease, their assigns.

  Space to be filled in or deleted.

  RIDERS ANNEXED HERETO ARE DEEMED INCORPORATED HEREIN.

        In Witness Whereof, Landlord and Tenant have respectively signed and
  sealed this lease as of the day and year first above written.

  Witness for Landlord:

                                               2315 Broadway Realty Co.

                                                        by:               [L.S.]

  Witness for Tenant:

                                               PRINCETON REVIEW, INC.     [L.S.]

                                                        by:
<PAGE>   24
                                 ACKNOWLEDGMENTS

  CORPORATE LANDLORD
  STATE OF NEW YORK,          )
        County of             )

        On this       day of            , 2000, before me personally came

  to me known, who being by me duly sworn, did depose and say that he resides in

  that he is the      of

  the corporation described in and which executed the foregoing instrument, as
  LANDLORD; that he knows the seal of said corporation; that the seal affixed to
  said instrument is such corporate seal; that it was as affixed by order of the
  Board of Directors of said corporation, and that he signed his name thereon by
  like order.

  INDIVIDUAL LANDLORD
  STATE OF NEW YORK           )
                              ) and
        County of             )

        On this                 day of         , 2000, before me personally came

  to me known and known to me to be the individual described in and who, as
  LANDLORD, executed the foregoing instrument and acknowledged to me that he
  executed the same.

  CORPORATE TENANT
  STATE OF NEW YORK,          )
                              ) and
        County of             )

        On this              day of            , 2000, before me personally came

  to me known, who being by me duly sworn, did depose and say that he resides in

<PAGE>   25

  that he is the                of

  the corporation described in and which executed the foregoing instrument, as
  TENANT; that he knows the seal of said corporation; that the seal affixed to
  said instrument is such corporate seal; that it was as affixed by order of the
  Board of Directors of said corporation, and that he signed his name thereon by
  like order.

  INDIVIDUAL TENANT
  STATE OF NEW YORK           )
                              ) and
        County of             )

        On this            day of            , 2000, before me personally came

  to me known and known to me to be the individual described in and who, as
  TENANT, executed the foregoing instrument and acknowledged to me that he
  executed the same.

<PAGE>   26
                                    GUARANTY

         FOR VALUE RECEIVED, and in consideration for, and is as _____________to
Landlord ___________ leave with Tenant, the undersigned guarantees to Landlord.
Landlord's successors and assigns the full performance and observance of all the
agreements, conditions and agreements therein provided to be performed and
observed by Tenant, including the "Rules and Regulations" as therein provided,
without requiring any notices of non-payment, non-performance, or
non-observance, or proof, or notice, or demand, whereby to charge the
undersigned therefor, all of which the undersigned hereby expressly waives and
expressly agrees that the validity of this agreement and the obligations of the
guarantor hereunder shall is no way be terminated, affected or impaired by
reason of the assertion by Landlord against Tenant of any of the right or
_______ reserved to Landlord pursuant to the _______________ of the within
lease. The undersigned further covenants and agrees that this guarantee shall
remain and continue in full force and effect as to any renewal, modification or
extension of this lease and during any period when Tenant is occupying the
premises as a "statutory tenant." As a further inducement to Landlord to make
this lease and in consideration thereof, Landlord and the undersigned covenant
and agree that in any action or proceeding brought by either Landlord or the
undersigned against the other on any matters whatsoever arising out of, under,
or by virtue of the terms of this lease or by this guarantee that Landlord and
the undersigned shall and do hereby waive trial by jury.

  Dated New York City                            , 2000

  WITNESS:

                                                                          (L.S.)

                                                              Residence

                                                              Business Address

  STATE OF NEW YORK           )                          Plan Name
        County of             )

        On this          day of                , 2000, before me personally came

                                                                         ,
  to me known and known to me to be the individual described in, and who
  executed the foregoing Guaranty and acknowledged to me that he executed the
  same.

                                                               (Notary)
<PAGE>   27

                             IMPORTANT - PLEASE READ

                      RULES AND REGULATIONS ATTACHED TO AND
                            MADE A PART OF THIS LEASE
                         IN ACCORDANCE WITH ARTICLE 32.

         1. The sidewalks, entrances, driveways, passages, courts, elevators,
vestibules, stairways, corridors or halls shall not be obstructed or encumbered
by any tenant or used for any purpose other than for ingress to and egress from
the demised premises and for delivery of merchandise and equipment in a prompt
and efficient manner using elevators and passageways designated for such
delivery by Landlord. There shall not be used in any space or in the public hall
of the building, either by any Tenant or by jobbers or others in the delivery or
receipt of merchandise, any hand trucks, except those equipped with rubber tires
and sideguards. If said premises are situated on the ground floor of the
building tenant thereof shall further, at tenants expense, keep the sidewalks
and curb in front of said premises clear and, free from ice, snow, dirt and
rubbish.

         2. The water and wash closets and plumbing fixtures shall not be used
for any purposes other than those for which they were designed or constructed
and no sweepings, rubbish, rags, acids or other substances shall be deposited
therein, and the expense of any breakers, stoppage, or damage resulting from the
violation of this rule shall be borne by the tenant who, or whose clerks,
agents, employees or visitors, shall have caused it.

         3. No carpet, rug or other article shall be hung or shaken out of any
window or the building; and no Tenant shall sweep or throw or permit to be swept
or thrown from the demised premises any dirt or other substance into any of the
corridors or halls, elevators, or out of the doors or windows or stairways of
the building, and Tenant shall not use, keep or permit to be used or kept any
foul or noxious gas or substance in the demised premises, or permit or suffer
the demised premises to be occupied or used in a manner offensive or
objectionable to Landlord or other occupants of the building by reason of noise,
odors and/or vibrations, or interfere in any way with other Tenants or those
having business therein, nor shall any animals or birds be kept in or about the
building. Smoking or carrying lighted cigars or cigarettes in the elevators of
the building is prohibited.

         4. No awnings or other projections shall be attached to the outside
walls of the building without the prior written consent of Landlord.

         5. No sign, advertisement, notice or other lettering shall be
exhibited, inscribed, printed or affixed by any Tenant on any part of the
outside of the demised premises or the building or on the inside of the demised
premises if the same is visible from the outside of the premises without the
prior written consent of Landlord, except that the name of Tenant may appear on
the entrance door of the premises. In the event of the violation of the
foregoing by any Tenant, Landlord may remove name without any liability, and may
charge the expense incurred by such removal to Tenant or Tenants violating this
rule. Interior signs on doors and
<PAGE>   28
directory tablet shall be inscribed, printed or affixed for each tenant by
Landlord at the expense of such Tenant, and shall be of a size, color and style
acceptable to Landlord.

         6. No Tenant shall mark, paint, drill into, or in any way deface any
part of the demised premises or the building of which they form a part. No
boring, cutting or stringing of wires shall be permitted, except with the prior
written consent of Landlord, and as Landlord may direct. No Tenant shall lay
linoleum, or other similar floor covering so that the same shall come in direct
contact with the floor of the demised premises, and, if linoleum or other
similar floor covering is desired to be used as       of builder's       felt
shall be first affixed to the floor, by a press or other material, soluble in
water, the use of cement or other similar adhesive material being expressly
prohibited.

         7. No additional locks or bolts of any kind shall be placed upon any of
the doors or windows by any tenant, nor shall any changes be made in existing
locks or mechanism thereof. Each Tenant must, upon the termination of his
Tenancy, return to Landlord all keys of stores, offices and toilet rooms, either
furnished to, or otherwise percurred by, such Tenant, and in the event of the
loss of any keys, so furnished, such Tenant shall pay to Landlord the cost
thereof.

         8. Freight, furniture, business equipment, merchandise and bulky matter
of any description shall be delivered to and removed from the premises only on
the freight elevators and through the service entrances and corridors, and only
during hours and in a manner approved by Landlord. Landlord reserves the right
to inspect all freight to be brought into the building and to exclude from the
building all freight which violates any of these Rules and Regulations or the
lease of which these Rules and Regulations are a part.

         9. No Tenant shall obtain for use upon the demised premises ice,
drinking water,      and other similar services, or accept barbering or
bootblacking services in the demised premises, except from persons authorized by
Landlord, and at hours and under regulations fixed by Landlord. Canvassing,
soliciting and peddling in the building is prohibited and each Tenant shall
cooperate to prevent the same.

         10. Landlord reserves the right to exclude from the building between
the hours of 6 P.M. and 8 A.M. and at all hours on Sundays and legal holidays
all persons who do not present a pass to the building signed by Landlord.
Landlord will furnish passes to persons for whom any Tenant reserves same in
writing. Each Tenant shall be responsible for all persons for whom he requests
such pass and shall be liable to Landlord for all acts of such person.

         11. Landlord shall have the right to prohibit any advertising by any
Tenant which, in Landlord's opinion, tends to impair the reputation of the
building or its desirability as a building for offices, and upon written notice
from Landlord, Tenant shall refrain from or discontinue such advertising.

         12. Tenant shall not bring or permit to be brought or kept in or on the
demised premises, any inflammable, combustible or explosive fluid, material,
chemical or substance, or
<PAGE>   29
cause or permit any odors of cooking or other processes, or any unusual or other
objectionable odors to permiate in or eminate from the demised premises.

         13. If the building contains central air conditioning and ventilation
Tenant agrees to keep all windows closed at all times and to abide by all rules
and regulations issued by the Landlord with respect to such services. If Tenant
requires air conditioning or ventilation after thee usual hours, Tenant shall
give notice in writing to the building superintendent prior to 3:00 P.M. in the
case of services required on week days, and prior to 3:00 P.M. on the day prior
in the case of after hours services required on weekends or on holidays.

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