Document:

LEASE AGREEMENT

                                 by and between

                          ENERGY (NJ) QRS 15-10, INC.,
                             a Delaware corporation

                                   as LANDLORD

                                       and

                      FOSTER WHEELER REALTY SERVICES, INC.,
                             a Delaware corporation,

                                    as TENANT

                             Premises: Perryville I
                                       Clinton, New Jersey

                         Dated as of: August _____, 2002

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                                TABLE OF CONTENTS

                                                                            PAGE

  1.       Demise of Premises................................................ 1

  2.       Certain Definitions............................................... 1

  3.       Title and Condition............................................... 9

  4.       Use of Leased Premises; Quiet Enjoyment........................... 10

  5.       Term.............................................................. 11

  6.       Basic Rent........................................................ 12

  7.       Additional Rent................................................... 12

  8.       Net Lease; Non-Terminability...................................... 13

  9.       Payment of Impositions............................................ 14

  10.      Compliance with Laws and Easement Agreements;
               Environmental Matters......................................... 15

  11.      Liens; Recording.................................................. 17

  12.      Maintenance and Repair............................................ 17

  13.      Alterations and Improvements...................................... 18

  14.      Permitted Contests................................................ 19

  15.      Indemnification................................................... 20

  16.      Insurance......................................................... 21

  17.      Casualty and Condemnation......................................... 24

  18.      Termination Events................................................ 25

  19.      Restoration....................................................... 26

  20.      Procedures Upon Purchase.......................................... 28

  21.      Assignment and Subletting, Prohibition Against
               Leasehold Financing........................................... 29

  22.      Events of Default................................................. 31

  23.      Remedies and Damages upon Default................................. 33

  24.      Notices........................................................... 36

  25.      Estoppel Certificate.............................................. 37

  26.      Surrender......................................................... 37

  27.      No Merger of Title................................................ 37

  28.      Books and Records................................................. 38

  29.      Determination of Value............................................ 39

  30.      Non-Recourse as to Landlord....................................... 40

  31.      Financing......................................................... 40

  32.      Subordination, Non-Disturbance and Attornment..................... 41

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  33.      Tax Treatment; Reporting.......................................... 41

  34.      Operating Covenants............................................... 41

  35.      Option to Purchase................................................ 41

  36.      Security Deposit.................................................. 42

  37.      Permitted Leasehold Mortgage...................................... 44

  38.      Rights of Permitted Leasehold Mortgagees.......................... 44

  39.      Miscellaneous..................................................... 46

EXHIBITS

           Exhibit "A"         - Premises
           Exhibit "B"         - Machinery and Equipment
           Exhibit "C"         - Schedule of Permitted Encumbrances
           Exhibit "D"         - Rent Schedule
           Exhibit "E"         - Operating Covenants

                                       ii

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           LEASE AGREEMENT, made as of this _____ day of August, 2002, between
ENERGY (NJ) QRS 15-10, INC., a Delaware corporation ("LANDLORD"), with an
address c/o W.P. Carey & Co. LLC, 50 Rockefeller Plaza, 2nd Floor, New York, New
York 10020, and FOSTER WHEELER REALTY SERVICES, INC., a Delaware corporation
("TENANT"), with an address at Perryville Corporate Park, Clinton, New Jersey
08809-4000.

           In consideration of the rents and provisions herein stipulated to be
paid and performed, Landlord and Tenant hereby covenant and agree as follows:

1. DEMISE OF PREMISES. Landlord hereby demises and lets to Tenant, and Tenant
hereby takes and leases from Landlord, for the term and upon the provisions
hereinafter specified, the following described property (collectively, the
"LEASED PREMISES"): (a) the leasehold interest of Landlord in land described in
Exhibit "A" hereto together with the Appurtenances (collectively, the "LAND");
(b) the building containing approximately 292,000 square feet, structures and
other improvements now or hereafter constructed on the Land (collectively, the
"IMPROVEMENTS"); and (c) the fixtures, machinery, equipment and other property
described in Exhibit "B" hereto (collectively, the "EQUIPMENT").

2.         CERTAIN DEFINITIONS.

           "Acquisition Cost" shall mean $47,015,706.81.

           Additional Rent" shall mean Additional Rent as
defined in Paragraph 7.

           "Adjoining Property" shall mean all sidewalks, driveways, curbs,
gores and vault spaces which adjoin the Leased Premises and for which Landlord
has any obligation to maintain, repair, restore or insure under any (a) contract
that was binding on Tenant when it conveyed the Land to Landlord or that was
entered into by Landlord with the written consent of Tenant, (b) Permitted
Encumbrance or (c) Legal Requirement.

           "Affiliate" shall mean any Person controlled by, in control of or
under common control with Tenant. For the purposes of this definition,
"control", as applied to any Person, means the possession of the power to direct
or cause the direction of the management and policies of that Person through the
ownership of voting rights or otherwise.

           "Alterations" shall mean all changes, additions, improvements or
repairs to, all alterations, reconstructions, renewals, replacements or removals
of and all substitutions or replacements for any of the Improvements or
Equipment, both interior and exterior, structural and non-structural, and
ordinary and extraordinary.

           "Appurtenances" shall mean all tenements, hereditaments, easements,
rights-of-way, rights, privileges in and to the Land, including (a) easements
over other lands granted by any Easement Agreement and (b) any streets, ways,
alleys, vaults, gores or strips of land adjoining the Land.

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           "Assignment" shall mean any assignment of rents and leases from
Landlord to a Lender which (a) encumbers any of the Leased Premises and (b)
secures Landlord's obligation to repay a Loan, as the same may be amended,
supplemented or modified from time to time.

           "Association" means Perryville Corporate Park Association, Inc., a
New Jersey non-profit corporation organized for the sole purpose of
administering, implementing and enforcing the provisions of the CC&R.

           "Basic Rent" shall mean Basic Rent as defined in Paragraph 6.

           "Basic Rent Payment Dates" shall mean the Basic Rent Payment Dates as
defined in Paragraph 6.

           "Casualty" shall mean any damage to or destruction of or which
affects the Leased Premises or Adjoining Property or which arises from the
Adjoining Property.

           "CC&R" shall mean that certain Declaration Of Covenants and
Restrictions dated as of August 15, 2002 among Foster Wheeler LLC, a Delaware
limited liability company, Tenant, and Landlord.

           "Commencement Date" shall mean Commencement Date as defined in
Paragraph 5.

           "Condemnation" shall mean a Taking.

           "Condemnation Notice" shall mean notice or knowledge of the
institution of or intention to institute any proceeding for Condemnation.

           "Costs" of a Person or associated with a specified transaction shall
mean all reasonable costs and expenses incurred by such Person or associated
with such transaction, including without limitation, attorneys' fees and
expenses, court costs, brokerage fees, escrow fees, title insurance premiums,
mortgage commitment fees, mortgage points, recording fees and transfer taxes, as
the circumstances require.

           "Covenants" shall mean the covenants and agreements described on
EXHIBIT "E".

           "Credit Agreement" shall mean the Credit Agreement as defined in
EXHIBIT "E".

           "CPI" shall mean CPI as defined in EXHIBIT "D" hereto.

           "Default Rate" shall mean the Default Rate as defined in Paragraph
7(a)(iv).

           "Default Termination Amount" shall mean the Default Termination
Amount as defined in Paragraph 23(a)(iii).

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           "Easement Agreement" shall mean any conditions, covenants,
restrictions, easements, declarations, licenses and other agreements listed as
Permitted Encumbrances or as may hereafter affect the Leased Premises.

           "Environmental Law" shall mean (i) whenever enacted or promulgated,
any applicable federal, state and local law, statute, ordinance, rule,
regulation, license, permit, authorization, approval, consent, court order,
judgment, decree, injunction, code, requirement or agreement with any
governmental entity, (x) relating to pollution (or the cleanup thereof), or the
protection of air, water vapor, surface water, groundwater, drinking water
supply, land (including land surface or subsurface), plant, aquatic and animal
life from injury caused by a Hazardous Substance or (y) concerning exposure to,
or the use, containment, storage, recycling, reclamation, reuse, treatment,
generation, discharge, transportation, processing, handling, labeling,
production, disposal or remediation of Hazardous Substances, Hazardous
Conditions or Hazardous Activities, in each case as amended and as now or
hereafter in effect, and (ii) any common law or equitable doctrine (including,
without limitation, injunctive relief and tort doctrines such as negligence,
nuisance, trespass and strict liability) that may impose liability or
obligations or injuries or damages due to or threatened as a result of the
presence of, exposure to, or ingestion of, any Hazardous Substance. The term
Environmental Law includes, without limitation, the federal Comprehensive
Environmental Response Compensation and Liability Act of 1980, the Superfund
Amendments and Reauthorization Act, the federal Water Pollution Control Act, the
federal Clean Air Act, the federal Clean Water Act, the federal Resources
Conservation and Recovery Act of 1976 (including the Hazardous and Solid Waste
Amendments to RCRA), the federal Solid Waste Disposal Act, the federal Toxic
Substance Control Act, the federal Insecticide, Fungicide and Rodenticide Act,
the federal Occupational Safety and Health Act of 1970, the federal National
Environmental Policy Act, the federal Hazardous Materials Transportation Act,
the New Jersey Industrial Site Recovery Act (formerly known as the Environmental
Cleanup Responsibility Act), as amended (N.J.S.A. ss.13:1K et seq.), and the New
Jersey Spill Compensation Act and Control Act, N.J.S.A. ss.58:10.23.11b et seq.,
each as amended and as now or hereafter in effect and any similar state or local
Law.

           "Environmental Violation" shall mean (a) any direct or indirect
discharge, disposal, spillage, emission, escape, pumping, pouring, injection,
leaching, release, seepage, filtration or transporting of any Hazardous
Substance at, upon, under, onto or within the Leased Premises, or from the
Leased Premises to the environment, in violation of any Environmental Law or in
excess of any reportable quantity established under any Environmental Law or
which in Landlord's opinion is reasonably likely to result in any liability to
Landlord, Tenant or Lender, any Federal, state or local government or any other
Person for the costs of any removal or remedial action or natural resources
damage or for bodily injury or property damage, (b) any deposit, storage,
dumping, placement or use of any Hazardous Substance at, upon, under or within
the Leased Premises (including any such activity that extends from the Leased
Premises to any Adjoining Property) in violation of any Environmental Law or in
excess of any reportable quantity established under any Environmental Law or
which is reasonably likely to result in any liability to any Federal, state or
local government or to any other Person for the costs of any removal or remedial
action or natural resources damage or for bodily injury or property damage, (c)
the abandonment or discarding of any barrels, containers or other receptacles
containing any Hazardous Substances in violation of any Environmental Laws, (d)
any activity, occurrence or condition which is reasonably likely to result in
any liability, cost or expense to Landlord or

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Lender or any other owner or occupier of the Leased Premises, or which is
reasonably likely to result in a creation of a lien on the Leased Premises under
any Environmental Law, or (e) any violation of or noncompliance with any
Environmental Law.

           "Equipment" shall mean the Equipment as defined in Paragraph 1.

           "Escrow Payments" shall mean Escrow Payments as defined in Paragraph
9(b).

           "Event of Default" shall mean an Event of Default as defined in
Paragraph 22(a).

           "Fair Market Value" shall mean the higher of (a) the fair market
value of the Leased Premises as of the Relevant Date as if unaffected and
unencumbered by this Lease or (b) the fair market value of the Leased Premises
as of the Relevant Date as affected and encumbered by this Lease and assuming
that the Term has been extended for all extension periods provided for herein.
For all purposes of this Lease, Fair Market Value shall be determined in
accordance with the procedure specified in Paragraph 29.

           "Fair Market Value Date" shall mean the date when the Fair Market
Value is determined in accordance with Paragraph 29.

           "Federal Funds" shall mean federal or other immediately available
funds which at the time of payment are legal tender for the payment of public
and private debts in the United States of America.

           "Ground Lease" shall mean that certain ground lease dated as of
August___, 2002 between Foster Wheeler LLC and Tenant, collectively as ground
lessor, and Landlord, as ground lessee.

           "Guarantors" shall mean Foster Wheeler LLC, a Delaware limited
liability company, and Foster Wheeler Ltd., a Bermuda corporation, Foster
Wheeler, Inc., a Delaware corporation, and Foster Wheeler International
Holdings, Inc., a Delaware corporation.

           "Guaranty" shall mean the Guaranty and Suretyship Agreement dated as
of the date hereof from Guarantors to Landlord guaranteeing the payment and
performance by Tenant of all of Tenant's obligations under the Lease.

           "Hazardous Activity" means any activity, process, procedure or
undertaking which directly or indirectly (i) procures, generates or creates any
Hazardous Substance; (ii) causes or results in (or threatens to cause or result
in) the release, seepage, spill, leak, flow, discharge or emission of any
Hazardous Substance into the environment (including the air, ground water,
watercourses or water systems), (iii) involves the containment or storage of any
Hazardous Substance, other than the containment or storage of Hazardous
Substances in compliance with Environmental Law and in amounts customarily used
or stored in connection with the operation and maintenance of an office building
such as the Leased Premises; or (iv) would cause the Leased Premises or any
portion thereof to become a hazardous waste treatment,

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recycling, reclamation, processing, storage or disposal facility within the
meaning of any Environmental Law.

           "Hazardous Condition" means any condition which would support any
claim or liability under any Environmental Law, including the presence of
underground storage tanks.

           "Hazardous Substance" means (i) any substance, material, product,
petroleum, petroleum product, derivative, compound or mixture, mineral
(including asbestos), chemical, gas, medical waste, or other pollutant, in each
case whether naturally occurring, man-made or the by-product of any process,
that is toxic, harmful or hazardous or acutely hazardous to the environment or
public health or safety or (ii) any substance supporting a claim under any
Environmental Law, whether or not defined as hazardous as such under any
Environmental Law. Hazardous Substances include, without limitation, any toxic
or hazardous waste, pollutant, contaminant, industrial waste, petroleum or
petroleum-derived substances or waste, radon, radioactive materials, asbestos,
asbestos containing materials, urea formaldehyde foam insulation, lead and
polychlorinated biphenyls.

           "Impositions" shall mean the Impositions as defined in Paragraph
9(a).

           "Improvements" shall mean the Improvements as defined in Paragraph 1.

           "Indemnitee" shall mean an Indemnitee as defined in Paragraph 15.

           "Insurance Requirements" shall mean the requirements of all insurance
policies required to be maintained in accordance with this Lease.

           "Land" shall mean the Land as defined in Paragraph 1.

           "Law" shall mean any constitution, statute, rule of law, code,
ordinance, order, judgment, decree, injunction, rule, regulation, policy,
requirement or administrative or judicial determination, even if unforeseen or
extraordinary, of every duly constituted governmental authority, court or
agency, now or hereafter enacted or in effect.

           "Lease" shall mean this Lease Agreement.

           "Lease Year" shall mean, with respect to the first Lease Year, the
period commencing on the Commencement Date and ending at midnight on the last
day of the twelfth (12th) consecutive calendar month following the month in
which the Commencement Date occurred, and each succeeding twelve (12) month
period during the Term.

           "Leased Premises" shall mean the Leased Premises as defined in
Paragraph 1.

           "Legal Requirements" shall mean the requirements of all present and
future Laws (including but not limited to Environmental Laws and Laws relating
to accessibility to, usability by, and discrimination against, disabled
individuals) and all covenants, restrictions and conditions now or hereafter of
record which may be applicable to Tenant or to any of the

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Leased Premises, or to the use, manner of use, occupancy, possession, operation,
maintenance, alteration, repair or restoration of any of the Leased Premises,
even if compliance therewith necessitates structural changes or improvements or
results in interference with the use or enjoyment of any of the Leased Premises
or requires Tenant to carry insurance other than as required by this Lease.

           "Lender" shall mean any person or entity (and its respective
successors and assigns) which may, on or after the date hereof, make a Loan to
Landlord or be the holder of a Note.

           "Loan" shall mean any loan made by one or more Lenders to Landlord,
which loan is secured by a Mortgage and an Assignment and evidenced by a Note.

           "Member" shall mean a Member as defined in the CC&R.

           "Monetary Obligations" shall mean Rent and all other sums payable by
Tenant under this Lease to Landlord, to any third party on behalf of Landlord or
to any Indemnitee.

           "Moody's" shall mean Moody's Investor Services, Inc. or its
successor.

           "Mortgage" shall mean any mortgage or deed of trust from Landlord to
a Lender which (a) encumbers any of the Leased Premises and (b) secures
Landlord's obligation to repay a Loan, as the same may be amended, supplemented
or modified.

           "Net Award" shall mean (a) the entire award payable to Landlord or
Lender by reason of a Condemnation whether pursuant to a judgment or by
agreement or otherwise, or (b) the entire proceeds of any insurance required
under clauses (i), (ii) (to the extent payable to Landlord or Lender), (iv), (v)
or (vi) of Paragraph 16(a), as the case may be, less any expenses incurred by
Landlord and Lender in collecting such award or proceeds.

           "Note" shall mean any promissory note evidencing Landlord's
obligation to repay a Loan, as the same may be amended, supplemented or
modified.

           "Offer Amount" shall mean the greater of (a) 110% of the Fair Market
Value of the Leased Premises as of the Relevant Date, minus $6,600,000, or (b)
the Acquisition Cost.

           "Option Exercise Notice" shall mean Option Exercise Notice as defined
in Paragraph 35.

           "Partial Casualty" shall mean any Casualty which does not constitute
a Termination Event.

           "Partial Condemnation" shall mean any Condemnation which does not
constitute a Termination Event.

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<PAGE>

           "Permitted Encumbrances" shall mean those covenants, restrictions,
reservations, liens, conditions and easements and other encumbrances, other than
any Mortgage or Assignment, listed on Exhibit "C" hereto (but such listing shall
not be deemed to revive any such encumbrances that have expired or terminated or
are otherwise invalid or unenforceable).

           "Permitted Leasehold Mortgage" shall mean any first lien leasehold
mortgage, deed of trust, pledge or similar security device in favor of a
Permitted Leasehold Mortgagee covering all of Tenant's leasehold estate in the
Leased Premises and which is specifically subject to the terms of this Lease and
the rights and remedies of Landlord hereunder.

           "Permitted Leasehold Mortgagee" shall mean a national banking
association, state chartered bank, savings and loan association, insurance
company, savings bank, foreign bank authorized to do business in the United
States, trust company, real estate investment trust or pension fund, each of
which shall have gross assets in excess of $250,000,000.

           "Person" shall mean an individual, partnership, association,
corporation or other entity.

           "Prepayment Premium" shall mean any payment required to be made by
Landlord to a Lender under a Note or any other document evidencing or securing a
Loan (other than payments of principal and/or interest which Landlord is
required to make under a Note or a Mortgage) solely by reason of any prepayment
or defeasance by Landlord of any principal due under a Note or Mortgage, and
which may, without limitation, take the form of (i) a "make whole" or yield
maintenance clause requiring a prepayment premium or (ii) a defeasance payment
(such defeasance payment to be an amount equal to the positive difference
between (a) the total amount required to defease a Loan and (b) the outstanding
principal balance of the Loan as of the date of such defeasance) plus, in any
case, reasonable Costs of Landlord and Lender.

           "Present Value" of any amount shall mean such amount discounted by a
rate per annum which is the lower of (a) the Prime Rate at the time such present
value is determined or (b) six percent (6%) per annum.

           "Prime Rate" shall mean the annual interest rate as published, from
time to time, in THE WALL STREET JOURNAL as the "Prime Rate" in its column
entitled "Money Rate". The Prime Rate may not be the lowest rate of interest
charged by any "large U.S. money center commercial banks" and Landlord makes no
representations or warranties to that effect. In the event THE WALL STREET
JOURNAL ceases publication or ceases to publish the "Prime Rate" as described
above, the Prime Rate shall be the average per annum discount rate (the
"DISCOUNT RATE") on ninety-one (91) day bills ("TREASURY BILLS") issued from
time to time by the United States Treasury at its most recent auction, plus
three hundred (300) basis points. If no such 91-day Treasury Bills are then
being issued, the Discount Rate shall be the discount rate on Treasury Bills
then being issued for the period of time closest to ninety-one (91) days.

           "Quarterly Assessments" shall mean Quarterly Assessments as defined
in the CC&R.

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           "Rating Agency" shall mean Moody's and S&P, as the context shall
require, or if either rating agency shall cease to furnish such rating, then a
rating agency reasonably acceptable to Landlord and Lender.

           "Relevant Amount" shall mean the Termination Amount, the Default
Termination Amount or the Offer Amount, as the case may be.

           "Relevant Date" shall mean (a) the date immediately prior to the date
on which the applicable Condemnation Notice is received, in the event of a
Termination Notice under Paragraph 18 which is occasioned by a Taking, (b) the
date immediately prior to the date on which the applicable Casualty occurs, in
the event of a Termination Notice under Paragraph 18 which is occasioned by a
Casualty, (c) the date when Fair Market Value is redetermined, in the event of a
redetermination of Fair Market Value pursuant to Paragraph 20(c), (d) the date
immediately prior to the Event of Default giving rise to the need to determine
Fair Market Value in the event Landlord provides Tenant with notice of its
intention to require Tenant to make a termination offer under Paragraph
23(a)(iii) or (e) the date on which Landlord receives the Option Exercise
Notice.

           "Renewal Term" shall mean Renewal Term as defined in Paragraph 5.

           "Rent" shall mean, collectively, Basic Rent and Additional Rent.

           "S&P" shall mean Standard & Poor's Corporation or its successor.

           "Security Deposit" shall mean Security Deposit as defined in
Paragraph 36.

           "Senior Credit Agreement" shall mean the Senior Credit Agreement as
defined in EXHIBIT "E".

           "Site Assessment" shall mean a Site Assessment as defined in
Paragraph 10(c).

           "SNDA" shall mean a Subordination, Non-Disturbance and Attornment
Agreement as defined in Paragraph 31.

           "Special Assessments" shall mean Special Assessments as defined in
the CC&R.

           "State" shall mean the State of New Jersey.

           "Surviving Obligations" shall mean any obligations of Tenant under
this Lease, actual or contingent, which arise on or prior to the expiration or
prior termination of this Lease or which survive such expiration or termination
by their own terms.

           "Taking" shall mean any taking or damaging of all or a portion of any
of the Leased Premises (i) in or by condemnation or other eminent domain
proceedings pursuant to any Law, general or special or (ii) by reason of any
agreement with any condemnor in settlement

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of or under threat of any such condemnation or other eminent domain proceeding.
The Taking shall be considered to have taken place as of the later of the date
actual physical possession is taken by the condemnor, or the date on which the
right to compensation and damages accrues under the law applicable to the Leased
Premises.

           "Term" shall mean the Term as defined in Paragraph 5.

           "Termination Amount" shall mean the greater of (a) the sum of the
Fair Market Value and the applicable Prepayment Premium which Landlord will be
required to pay in prepaying or defeasing, as applicable, any Loan with proceeds
of the Termination Amount or (b) the sum of the Acquisition Cost and the
applicable Prepayment Premium which Landlord will be required to pay in
prepaying or defeasing in whole or in part, as applicable, any Loan with
proceeds of the Termination Amount.

           "Termination Date" shall mean Termination Date as defined in
Paragraph 18.

           "Termination Event" shall mean a Termination Event as defined in
Paragraph 18.

           "Termination Notice" shall mean Termination Notice as defined in
Paragraph 18(a).

           "Warranties" shall mean Warranties as defined in Paragraph 3(d).

3.         TITLE AND CONDITION.

     (a) The Leased Premises are demised and let subject to (i) the terms of the
Ground Lease, (ii) the Mortgage and Assignment presently in effect, (iii) the
rights of any Persons in possession of the Leased Premises, (iv) the existing
state of title of any of the Leased Premises, including any Permitted
Encumbrances, (v) any state of facts which an accurate survey or physical
inspection of the Leased Premises might show, (vi) all Legal Requirements,
including any existing violation of any thereof, and (vii) the condition of the
Leased Premises as of the commencement of the Term, without representation or
warranty by Landlord.

     (b) Tenant acknowledges that the Leased Premises is in good condition and
repair at the inception of this Lease. LANDLORD LEASES AND WILL LEASE AND TENANT
TAKES AND WILL TAKE THE LEASED PREMISES AS IS. TENANT ACKNOWLEDGES THAT LANDLORD
(WHETHER ACTING AS LANDLORD HEREUNDER OR IN ANY OTHER CAPACITY) HAS NOT MADE AND
WILL NOT MAKE, NOR SHALL LANDLORD BE DEEMED TO HAVE MADE, ANY WARRANTY OR
REPRESENTATION, EXPRESS OR IMPLIED, WITH RESPECT TO ANY OF THE LEASED PREMISES,
INCLUDING ANY WARRANTY OR REPRESENTATION AS TO (i) ITS FITNESS, DESIGN OR
CONDITION FOR ANY PARTICULAR USE OR PURPOSE, (ii) THE QUALITY OF THE MATERIAL OR
WORKMANSHIP THEREIN, (iii) THE EXISTENCE OF ANY DEFECT, LATENT OR PATENT, (iv)
LANDLORD'S TITLE THERETO, (v) VALUE, (vi) COMPLIANCE WITH SPECIFICATIONS, (vii)
LOCATION, (viii) USE, (ix) CONDITION, (x) MERCHANTABILITY, (xi) QUALITY, (xii)

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DESCRIPTION, (xiii) DURABILITY, (xiv) OPERATION, (xv) THE EXISTENCE OF ANY
HAZARDOUS SUBSTANCE, HAZARDOUS CONDITION OR HAZARDOUS ACTIVITY OR (xvi)
COMPLIANCE OF THE LEASED PREMISES WITH ANY LAW OR LEGAL REQUIREMENT; AND ALL
RISKS INCIDENT THERETO ARE TO BE BORNE BY TENANT. TENANT ACKNOWLEDGES THAT THE
LEASED PREMISES IS OF ITS SELECTION AND TO ITS SPECIFICATIONS AND THAT THE
LEASED PREMISES HAS BEEN INSPECTED BY TENANT AND IS SATISFACTORY TO IT. IN THE
EVENT OF ANY DEFECT OR DEFICIENCY IN ANY OF THE LEASED PREMISES OF ANY NATURE,
WHETHER LATENT OR PATENT, LANDLORD SHALL NOT HAVE ANY RESPONSIBILITY OR
LIABILITY WITH RESPECT THERETO OR FOR ANY INCIDENTAL OR CONSEQUENTIAL DAMAGES
(INCLUDING STRICT LIABILITY IN TORT). THE PROVISIONS OF THIS PARAGRAPH 3(b) HAVE
BEEN NEGOTIATED, AND ARE INTENDED TO BE A COMPLETE EXCLUSION AND NEGATION OF ANY
WARRANTIES BY LANDLORD, EXPRESS OR IMPLIED, WITH RESPECT TO ANY OF THE LEASED
PREMISES, ARISING PURSUANT TO THE UNIFORM COMMERCIAL CODE OR ANY OTHER LAW NOW
OR HEREAFTER IN EFFECT OR ARISING OTHERWISE.

     (c) Tenant represents to Landlord that Tenant has examined the title to the
Leased Premises prior to the execution and delivery of this Lease and has found
the same to be satisfactory for the purposes contemplated hereby. Tenant
acknowledges that (i) leasehold title to the Land and the fee simple title to
the Improvements and Equipment (both legal and equitable) is in Landlord and,
except as provided in Paragraph 35 hereof with respect to an option to purchase
the Leased Premises that Tenant has only a leasehold right of possession and use
of the Leased Premises, as provided herein, (ii) the Improvements conform to all
material Legal Requirements and all Insurance Requirements, (iii) all easements
necessary or appropriate for the use or operation of the Leased Premises have
been obtained, (iv) all contractors and subcontractors who have performed work
on or supplied materials to the Leased Premises have been fully paid, and all
materials and supplies have been fully paid for, (v) the Improvements have been
fully completed in all material respects in a workmanlike manner of first class
quality, and (vi) all Equipment necessary or appropriate for the use or
operation of the Leased Premises has been installed and is presently fully
operative in all material respects.

     (d) Landlord hereby assigns to Tenant, without recourse or warranty
whatsoever, all assignable warranties, guaranties, indemnities and similar
rights (collectively, "WARRANTIES") which Landlord may have against any
manufacturer, seller, engineer, contractor or builder in respect of any of the
Leased Premises. Such assignment shall remain in effect until the expiration or
earlier termination of this Lease, whereupon such assignment shall cease and all
of the Warranties, guaranties, indemnities and other rights shall automatically
revert to Landlord. In confirmation of such reversion Tenant shall execute and
deliver promptly any certificate or other document reasonably required by
Landlord. Landlord shall also retain the right to enforce any guaranties upon
the occurrence of an Event of Default. Tenant shall enforce the Warranties in
accordance with their respective terms.

                                      -10-
<PAGE>

4.         USE OF LEASED PREMISES; QUIET ENJOYMENT.

     (a) Tenant may occupy and use the Leased Premises for office facilities and
uses ancillary thereto and for no other purpose without the prior written
consent of Landlord. Tenant shall not use or occupy or permit any of the Leased
Premises to be used or occupied, nor do or permit anything to be done in or on
any of the Leased Premises, in a manner which would or would be reasonably
likely to (i) violate any Law, Legal Requirement or Permitted Encumbrance, (ii)
make void or voidable or cause any insurer to cancel any insurance required by
this Lease, or make it difficult or impossible to obtain any such insurance at
commercially reasonable rates, (iii) make void or voidable, cancel or cause to
be cancelled or release any of the Warranties, (iv) cause structural injury to
any of the Improvements or (v) constitute a public or private nuisance or waste.

     (b) Subject to the provisions hereof, so long as no Event of Default has
occurred and is continuing, Tenant shall quietly hold, occupy and enjoy the
Leased Premises throughout the Term, without any hindrance, ejection or
molestation by Landlord with respect to matters that arise after the date
hereof, provided that Landlord or its agents may enter upon and examine any of
the Leased Premises at such reasonable times as Landlord may select and upon
reasonable prior notice to Tenant (except in the case of an emergency, in which
no notice shall be required) for the purpose of inspecting the Leased Premises,
verifying compliance or non-compliance by Tenant with its obligations hereunder
and the existence or non-existence of an Event of Default or event which with
the passage of time and/or notice would constitute an Event of Default, showing
the Leased Premises to prospective Lenders and purchasers and taking such other
action with respect to the Leased Premises as is permitted by any provision
hereof, provided that no such entry by Landlord or such other Persons shall
interfere in any material respect with the operations of Tenant at the Leased
Premises.

5.         TERM.

     (a) Subject to the provisions hereof, Tenant shall have and hold the Leased
Premises for an initial term (such term, as extended or renewed in accordance
with the provisions hereof, being called the "TERM") commencing on the date
hereof (the "COMMENCEMENT DATE") and ending on the last day of the two hundred
fortieth (240th) calendar month next following the date hereof (the "EXPIRATION
DATE").

     (b) Provided that this Lease shall not have been terminated pursuant to any
provision hereof, Tenant shall have the right to extend the Term for two
additional periods of ten (10) years each, effective as of the Expiration Date
and on the tenth (10th) anniversary of the Expiration Date (each such ten (10)
year extension, a "RENEWAL TERM"), upon written notice to Landlord at least one
(1) year prior to the first day of the applicable Renewal Term that Tenant is
extending the Term for such Renewal Term. Any such extension of the Term shall
be subject to all of the provisions of this Lease, as the same may be amended,
supplemented or modified (except that after the second Renewal Term Tenant shall
not have the right to any further Renewal Terms).

     (c) If Tenant does not exercise any option to extend the Term, or if an
Event of Default occurs and is continuing, then Landlord shall have the right
during the

                                      -11-
<PAGE>

remainder of the Term then in effect and, in any event, Landlord shall have the
right during the last year of the Term, upon reasonable prior notice to Tenant,
to (i) advertise the availability of the Leased Premises for sale or reletting
and to erect upon the Leased Premises signs indicating such availability and
(ii) show the Leased Premises to prospective purchasers or tenants or their
agents at such reasonable times as Landlord may select, provided that no such
entry by Landlord or such other Persons shall interfere in any material respect
with the operations of Tenant at the Leased Premises.

6.         BASIC RENT. Tenant shall pay to Landlord, as annual rent for the
Leased Premises during the Term, the amounts determined in accordance with
Exhibit "D" hereto ("Basic Rent"), commencing on the twenty-fifth day of August,
2002, and thereafter on the same day of each February, May, August and November
during the Term (each such day being a "BASIC RENT PAYMENT DATE"). Each such
rental payment shall be made by wire transfer in Federal Funds no later than the
applicable Basic Rent Payment Date and at Landlord's sole discretion (a) to
Landlord pursuant to wire transfer instructions provided to Tenant from time to
time and/or (b) to such one other Person, pursuant to wire transfer instructions
provided to Tenant from time to time and in such proportions as Landlord may
direct by fifteen (15) days' prior written notice to Tenant (in which event
Tenant shall give Landlord notice of each such payment concurrent with the
making thereof).
7.         ADDITIONAL RENT.

     (a) Tenant shall pay and discharge, as additional rent (collectively,
"ADDITIONAL RENT"):

           (i) except as otherwise specifically provided herein, all costs and
expenses of Tenant, Landlord and any other Persons specifically referenced
herein which are incurred in connection or associated with (A) the ownership,
use, non-use, occupancy, monitoring, possession, operation, condition, design,
construction, maintenance, alteration, repair or restoration of any of the
Leased Premises, (B) the performance of any of Tenant's obligations under this
Lease, (C) any sale or other transfer of any of the Leased Premises to Tenant
under this Lease, (D) any Condemnation proceedings, (E) the adjustment,
settlement or compromise of any insurance claims involving or arising from any
of the Leased Premises, (F) the prosecution, defense or settlement of any
litigation involving or arising from any of the Leased Premises, this Lease, or
the ground leasing of the Land or sale of the Improvements and Equipment to
Landlord (it being understood and agreed, however, that in the event of any
litigation involving only Landlord and Tenant, Tenant shall be responsible for
such costs and expenses only if and to the extent that Tenant is not the
prevailing party in such litigation), (G) the exercise or enforcement by
Landlord or its successors and assigns, of any of its rights under this Lease,
except to the extent that Tenant is the prevailing party in any resulting
litigation, (H) any amendment to or modification or termination of this Lease
made at the request of Tenant, (I) Costs of Landlord's counsel and reasonable
internal Costs of Landlord incurred in connection with any act undertaken by
Landlord (or its counsel) at the request of Tenant, or incurred in connection
with any act of Landlord performed on behalf of Tenant and (J) any other items
specifically required to be paid by Tenant under this Lease (other than Basic
Rent);

                                      -12-
<PAGE>

           (ii) after the date all or any portion of any installment of Basic
Rent is due and not paid by the applicable Basic Rent Payment Date, an amount
(the "LATE CHARGE") equal to four percent (4%) of the amount of such unpaid
installment or portion thereof, provided, however, that with respect to the
first late payment of all or any portion of any installment of Basic Rent in any
Lease Year, the Late Charge shall not be due and payable unless the Basic Rent
has not been paid within five (5) days' following notice of non-payment;

           (iii) a sum equal to any additional sums (including any late charge,
default penalties, interest and fees of Lender's counsel) which are payable by
Landlord to any Lender under any Note by reason of Tenant's late payment or
non-payment of Basic Rent or by reason of an Event of Default; and

           (iv) interest at the rate (the "DEFAULT RATE") of five percent (5%)
over the Prime Rate per annum on the following sums until paid in full: (A) all
overdue installments of Basic Rent from the respective due dates thereof and (B)
all overdue amounts of Additional Rent relating to obligations which Landlord
shall have paid on behalf of Tenant, from the date of payment thereof by
Landlord.

     (b) Tenant shall pay and discharge (i) any Additional Rent referred to in
Paragraph 7(a)(i) when the same shall become due, provided that amounts which
are billed to Landlord or any third party, but not to Tenant, shall be paid
within ten (10) days after Landlord's demand for payment thereof, and (ii) any
other Additional Rent, within ten (10) days after Landlord's demand for payment
thereof.

     (c) In no event shall amounts payable under Paragraph 7(a)(ii), (iii) and
(iv) exceed the maximum amount permitted by applicable Law.

8.         NET LEASE; NON-TERMINABILITY.

     (a) This is a net lease and all Monetary Obligations shall be paid without
notice or demand (except as otherwise specifically provided herein) and without
set-off, counterclaim, recoupment, abatement, suspension, deferment, diminution,
deduction, reduction or defense (collectively, a "SET-OFF").

     (b) This Lease and the rights of Landlord and the obligations of Tenant
hereunder shall not be affected by any event or for any reason or cause
whatsoever foreseen or unforeseen.

     (c) The obligations of Tenant hereunder shall be separate and independent
covenants and agreements, all Monetary Obligations shall continue to be payable
in all events (or, in lieu thereof, Tenant shall pay amounts equal thereto), and
the obligations of Tenant hereunder shall continue unaffected unless the
requirement to pay or perform the same shall have been terminated pursuant to an
express provision of this Lease. The obligation to pay Rent or amounts equal
thereto shall not be affected by any collection of rents by any governmental
body pursuant to a tax lien or otherwise, even though such obligation results in
a double payment of Rent. All Rent payable by Tenant hereunder shall constitute
"rent" for all purposes (including Section 502(b)(6) of the Federal Bankruptcy
Code).

                                      -13-
<PAGE>

     (d) Except as otherwise expressly provided herein, Tenant shall have no
right and hereby waives all rights which it may have under any Law (i) to quit,
terminate or surrender this Lease or any of the Leased Premises, or (ii) to any
Set-Off of any Monetary Obligations.

9.         PAYMENT OF IMPOSITIONS.

     (a) Tenant shall, before interest or penalties are due thereon, pay and
discharge all taxes (including real and personal property, franchise, sales,
use, gross receipts and rent taxes), all charges for any easement or agreement
maintained for the benefit of any of the Leased Premises, all Quarterly
Assessments, all Special Assessments, all assessments and levies, all permit,
inspection and license fees, all rents and charges for water, sewer, utility and
communication services relating to any of the Leased Premises, all ground rents
and all other public charges whether of a like or different nature, even if
unforeseen or extraordinary, imposed upon or assessed against (i) Tenant, (ii)
Tenant's leasehold interest in the Leased Premises, (iii) any of the Leased
Premises, (iv) Landlord as a result of or arising in respect of the acquisition,
ownership, occupancy, leasing, use, possession or sale of any of the Leased
Premises, including arising out of Landlord's status as a Member under the CC&R,
any activity conducted on any of the Leased Premises, or the Rent, or (v) any
Lender by reason of any Note, Mortgage, Assignment or other document evidencing
or securing a Loan and which (as to this clause (v)) Landlord has agreed to pay
(collectively, the "IMPOSITIONS"); provided, that nothing herein shall obligate
Tenant to pay (A) income, excess profits or other taxes of Landlord (or Lender)
which are determined on the basis of Landlord's (or Lender's) net income or net
worth (unless such taxes are in lieu of or a substitute for any other tax,
assessment or other charge upon or with respect to the Leased Premises which, if
it were in effect, would be payable by Tenant under the provisions hereof or by
the terms of such tax, assessment or other charge), (B) any estate, inheritance,
succession, gift or similar tax imposed on Landlord or (C) any capital gains tax
imposed on Landlord in connection with the sale of the Leased Premises to any
Person. If any Imposition may be paid in installments without interest or
penalty, Tenant shall have the option to pay such Imposition in installments; in
such event, Tenant shall be liable only for those installments which accrue or
become due and payable during the Term. Tenant shall prepare and file all tax
reports required by governmental authorities which relate to the Impositions.
Tenant shall deliver to Landlord (1) copies of all settlements and notices
pertaining to the Impositions which may be issued by any governmental authority
within ten (10) days after Tenant's receipt thereof, (2) receipts for payment of
all taxes required to be paid by Tenant hereunder within thirty (30) days after
the due date thereof and (3) receipts for payment of all other Impositions
within ten (10) days after Landlord's request therefor.

     (b) Following the occurrence and during the continuance of an Event of
Default or if Landlord is required by a Lender to pay into escrow funds
necessary to pay Escrow Charges, Tenant shall pay to Landlord such amounts (each
an "ESCROW PAYMENT") monthly or as required by such Lender (but not more often
than monthly) so that there shall be in an escrow account an amount sufficient
to pay the annual Escrow Charges (as hereinafter defined) as they become due. As
used herein, "ESCROW CHARGES" shall mean real estate taxes and assessments on or
with respect to the Leased Premises or payments in lieu thereof and premiums on
any insurance required by this Lease, Quarterly Assessments and any reasonable
reserves for capital improvements, deferred maintenance repair and/or tenant
improvements and leasing

                                      -14-
<PAGE>

commissions required by any Lender. Landlord shall, in its reasonable judgment,
determine the amount of the Escrow Charges (it being agreed that if required by
a Lender, such amounts shall equal any corresponding escrow installments
required to be paid by Landlord, so long as such amounts are consistent with
Tenant's obligations hereunder) and the amount of each Escrow Payment. As long
as the Escrow Payments are being held by Landlord the Escrow Payments shall not
be commingled with other funds of Landlord or other Persons and interest thereon
shall accrue for the benefit of Tenant from the date such monies are received
and invested until the date such monies are disbursed to pay Escrow Charges.
Landlord shall apply or cause Lender to apply the Escrow Payments to the payment
of the Escrow Charges in such order or priority as Landlord or Lender shall
reasonably determine or as required by Law. If at any time the Escrow Payments
theretofore paid to Landlord shall be insufficient for the payment of the Escrow
Charges, Tenant, within ten (10) days after Landlord's demand therefor, shall
pay the amount of the deficiency to Landlord. In the event Lender no longer
requires Landlord to make Escrow Payments or upon the expiration of the Term
and, provided that no Event of Default shall then exist and be continuing, any
and all Escrow Payments then held by Landlord or Lender and not allocated to the
payment of real estate taxes and/or assessments, Quarterly Assessments or
Special Assessments accruing prior to the date of Lender's waiver of the escrow
requirement or the last day of the Term, as applicable, shall be promptly
returned to Tenant. Any Escrow Payments held by Landlord or Lender upon the
occurrence of an Event of Default shall be applied to fulfill Tenant's
obligations under this Lease, with the balance thereof, if any, being applied to
Landlord's damages under Article 23 hereof.

     (c) Provided that no Event of Default shall exist and be continuing,
Landlord hereby grants to Tenant the exclusive right to exercise any right or
power which Landlord shall have or possess by virtue of its status of as a
Member under the CC&R, including the right to vote or otherwise participate in
the management of the Association. Landlord agrees to execute and deliver such
powers of attorney, consents and other instruments as Tenant shall request from
time to time to evidence Tenant's authority under this Section 9(c). It is the
intention of the parties that the other Members shall be entitled to rely upon
the authority hereby granted to Tenant.

10.        COMPLIANCE WITH LAWS AND EASEMENT AGREEMENTS; ENVIRONMENTAL MATTERS.

     (a) Tenant shall, at its expense, comply with and conform to, and cause the
Leased Premises and any other Person occupying any part of the Leased Premises
to comply with and conform to, the terms and conditions of the Ground Lease, the
terms and conditions of the CC&R, all Insurance Requirements and Legal
Requirements (including all applicable Environmental Laws). Tenant shall not at
any time (i) cause, permit or suffer to occur any Environmental Violation or
(ii) permit any sublessee, assignee or other Person occupying the Leased
Premises under or through Tenant to cause, permit or suffer to occur any
Environmental Violation and, at the request of Landlord or Lender, Tenant shall
promptly remediate or undertake any other appropriate response action to correct
any existing Environmental Violation. Any and all reports prepared for or by
Landlord with respect to the Leased Premises shall be for the sole benefit of
Landlord and Lender and no other Person shall have the right to rely on any such
reports, except that Tenant shall have the right to receive copies of any
reports that are

                                      -15-
<PAGE>

required or requested by any governmental agency having jurisdiction over the
Leased Premises and to deliver copies of such reports to any such governmental
agency.

     (b) Tenant, at its sole cost and expense, will at all times promptly and
faithfully abide by, discharge and perform all of the covenants, conditions and
agreements contained in any Easement Agreement on the part of Landlord or the
occupier to be kept and performed thereunder. Neither Landlord nor Tenant will
alter, modify, amend or terminate any Easement Agreement, give any consent or
approval thereunder, or enter into any new Easement Agreement without, in each
case, the prior written consent of the other party, which consent shall not be
unreasonably withheld or delayed.

     (c) Upon reasonable prior written notice from Landlord, Tenant shall permit
such persons as Landlord may designate ("SITE REVIEWERS") to visit the Leased
Premises and perform environmental site investigations and assessments ("SITE
ASSESSMENTS") on the Leased Premises (i) in connection with any sale, financing
or refinancing of the Leased Premises, (ii) within the six month period prior to
the expiration of the Term, (iii) if required by Lender or the terms of any
credit facility to which Landlord is bound, (iv) if an Event of Default exists,
or (v) at any other time that, in the opinion of Landlord or Lender, a
reasonable basis exists to believe that an Environmental Violation or any
condition that could reasonably be expected to result in any Environmental
Violation exists, provided that so long as no Event of Default exists, no such
entry by Landlord or such other Persons shall interfere in any material respect
with the operations of Tenant at the Leased Premises. Such Site Assessments may
include both above and below the ground testing for Environmental Violations and
such other tests as may be necessary, in the opinion of the Site Reviewers, to
conduct the Site Assessments. Tenant shall supply to the Site Reviewers such
historical and operational information regarding the Leased Premises as may be
reasonably requested by the Site Reviewers to facilitate the Site Assessments,
and shall make available for meetings with the Site Reviewers appropriate
personnel having knowledge of such matters. The reasonable and actual cost of
performing and reporting Site Assessments shall be paid by Tenant.

     (d) If an Environmental Violation occurs or is found to exist and, in
Landlord's reasonable judgment, the cost of remediation of, or other response
action with respect to, the same is likely to exceed $250,000, Tenant shall
provide to Landlord, within ten (10) days after Landlord's request therefor,
adequate financial assurances that Tenant will effect such remediation in
accordance with applicable Environmental Laws. Such financial assurances shall
be a bond or letter of credit reasonably satisfactory to Landlord in form and
substance and in an amount equal to or greater than Landlord's reasonable
estimate, based upon a Site Assessment performed pursuant to Paragraph 10(c), of
the anticipated cost of such remedial action.

     (e) Notwithstanding any other provision of this Lease, if an Environmental
Violation occurs or is found to exist, the Term would otherwise terminate or
expire and Landlord after good faith efforts is unable to relet the Leased
Premises at then market rates solely because of such Environmental Violation,
then, at the option of Landlord, the Term shall be automatically extended beyond
the date of termination or expiration and this Lease shall remain in full force
and effect beyond such date until the earlier to occur of (i) the completion of
all remedial action in accordance with applicable Environmental Laws or (ii) the
date specified in a written notice from Landlord to Tenant terminating this
Lease.

                                      -16-
<PAGE>

     (f) If Tenant fails, within a reasonable period of time after written
notice from Landlord, to take appropriate steps to correct any Environmental
Violation which occurs or is found to exist, Landlord shall have the right (but
no obligation) to take any and all actions as Landlord shall reasonably deem
necessary or advisable in order to cure such Environmental Violation.

     (g) Tenant shall notify Landlord promptly after becoming aware of any
Environmental Violation (or alleged Environmental Violation) or noncompliance
with any of the covenants contained in this Paragraph 10 and shall forward to
Landlord promptly upon receipt thereof copies of all orders, reports, notices,
permits, applications or other communications relating to any such violation or
noncompliance.

     (h) Tenant shall not use the Leased Premises or any portion thereof as a
"Major Facility" (as such term is defined in the New Jersey Spill Compensation
Act and Control Act, N.J.S.A.ss.58:10.23.11b et seq.).

     (i) Tenant shall not conduct or cause or permit to be conducted on the
Leased Premises any activity which constitutes an "Industrial Establishment," as
such term is defined in the New Jersey Industrial Site Recovery Act (formerly
known as the Environmental Cleanup Responsibility Act), as amended (N.J.S.A.
ss.13:1K et seq.) ("ISRA"). In the event that the provisions of ISRA become
applicable to the Leased Premises subsequent to the date hereof, Tenant shall
give prompt written notice thereof to Landlord and shall take immediate
requisite action to insure full compliance therewith. Tenant shall promptly
deliver to Landlord copies of all correspondence, notices and submissions that
it sends to or receives from the New Jersey Department of Environmental
Protection in connection with such ISRA compliance.

     (j) All future leases, subleases or concession agreements relating to the
Leased Premises entered into by Tenant shall contain covenants of the other
party not to at any time (i) cause any Environmental Violation to occur or (ii)
permit any Person occupying the Leased Premises through said subtenant or
concessionaire to cause any Environmental Violation to occur.

11.        LIENS; RECORDING.

     (a) Tenant shall not, directly or indirectly, create or permit to be
created or to remain and shall promptly discharge or remove any lien, levy or
encumbrance on any of the Leased Premises or on any Rent or any other sums
payable by Tenant under this Lease, other than any Mortgage or Assignment, the
Permitted Encumbrances and any mortgage, lien, encumbrance or other charge
created by or resulting solely from any act or omission of Landlord. NOTICE IS
HEREBY GIVEN THAT LANDLORD SHALL NOT BE LIABLE FOR ANY LABOR, SERVICES OR
MATERIALS FURNISHED OR TO BE FURNISHED TO TENANT OR TO ANYONE HOLDING OR
OCCUPYING ANY OF THE LEASED PREMISES THROUGH OR UNDER TENANT, AND THAT NO
MECHANICS' OR OTHER LIENS FOR ANY SUCH LABOR, SERVICES OR MATERIALS SHALL ATTACH
TO OR AFFECT THE INTEREST OF LANDLORD IN AND TO ANY OF THE LEASED PREMISES.
LANDLORD MAY AT ANY TIME, AND AT LANDLORD'S REQUEST TENANT SHALL

                                      -17-
<PAGE>

PROMPTLY, POST ANY NOTICES ON THE LEASED PREMISES REGARDING SUCH NON-LIABILITY
OF LANDLORD.

     (b) Tenant shall execute, deliver and record, file or register
(collectively, "RECORD") all such instruments as may be required or permitted by
any present or future Law in order to evidence the respective interests of
Landlord and Tenant in the Leased Premises, and Landlord and Tenant shall
execute and Landlord shall cause a memorandum of this Lease (or, if such a
memorandum cannot be recorded, this Lease), and any supplement hereto or
thereto, to be recorded in such manner and in such places as may be required or
permitted by any present or future Law in order to protect the validity and
priority of this Lease.

12.        MAINTENANCE AND REPAIR.

     (a) Tenant shall at all times maintain the Leased Premises and the
Adjoining Property in as good repair and appearance as they are in on the date
hereof and fit to be used for their intended use in accordance with the
practices observed by owners or operators of other comparable first class office
buildings in the Central New Jersey area, ordinary wear and tear excepted, and,
in the case of the Equipment, in as good mechanical condition as it was on the
later of the date hereof or the date of its installation, except for ordinary
wear and tear. Tenant shall take every other action reasonably necessary or
appropriate for the preservation and safety of the Leased Premises. Tenant shall
promptly make all Alterations of every kind and nature, whether foreseen or
unforeseen, which may be required to comply with the foregoing requirements of
this Paragraph 12(a). Landlord shall not be required to make any Alteration,
whether foreseen or unforeseen, or to maintain any of the Leased Premises or
Adjoining Property in any way, and Tenant hereby expressly waives any right
which may be provided for in any Law now or hereafter in effect to make
Alterations at the expense of Landlord or to require Landlord to make
Alterations. Any Alteration made by Tenant pursuant to this Paragraph 12 shall
be made in conformity with the provisions of Paragraph 13.

     (b) If any Improvement, now or hereafter constructed, shall (i) encroach
upon any setback or any property, street or right-of-way adjoining the Leased
Premises, (ii) violate the provisions of any restrictive covenant affecting the
Leased Premises, (iii) hinder or obstruct any easement or right-of-way to which
any of the Leased Premises is subject or (iv) impair the rights of others in, to
or under any of the foregoing, Tenant shall, promptly after receiving notice or
otherwise acquiring knowledge thereof, either (A) obtain from all necessary
parties waivers or settlements of all claims, liabilities and damages resulting
from each such encroachment, violation, hindrance, obstruction or impairment,
whether the same shall affect Landlord, Tenant or both, or (B) take such action
as shall be necessary to remove all such encroachments, hindrances or
obstructions and to end all such violations or impairments, including, if
necessary, making Alterations.

13.        ALTERATIONS AND IMPROVEMENTS.

     (a) Tenant shall have the right, without having obtained the prior written
consent of Landlord or Lender and provided that no Event of Default then exists,
(i) to make non-structural Alterations or a series of related non-structural
Alterations that, as to any such Alterations or series of related Alterations,
do not cost in excess of $500,000 and (ii) to

                                      -18-
<PAGE>

install Equipment in the Improvements or accessions to the Equipment that, as to
such Equipment or accessions, do not cost in excess of $500,000, so long as at
the time of construction or installation of any such Equipment or Alterations
the value and utility of the Leased Premises is not diminished thereby. If (i)
the cost of any non-structural Alterations or series of related non-structural
Alterations is in excess of $500,000, (ii) the cost of any Equipment or
accessions thereto is in excess of $500,000, or (iii) Tenant desires to make
structural Alterations to the Leased Premises, the prior written approval of
Landlord and Lender shall be required, which approval by Landlord shall not be
unreasonable withheld or delayed. Tenant shall not construct upon the Land any
additional buildings without having first obtained the prior written consent of
Landlord and Lender. Landlord shall have the right to require Tenant to remove
any Alterations except for Alterations required by Law, Alterations made for
office use or uses ancillary there (i.e., cafeteria, health club or retail) so
long as any such Alterations do not lessen the market value of the Leased
Premises, or Alterations for which Landlord has agreed in writing that removal
will not be required. Landlord acknowledges that as of the Commencement Date
certain roofing repair work is being performed at the Leased Premises at the
direction of Tenant (the "Patti Roofing Work"), consents to the Patti Roofing
Work and agrees that the cost of the Patti Roofing Work shall not be counted
towards the $500,000 non-structural Alteration threshold for consent noted
above. Tenant acknowledges that the Patti Roofing Work shall be subject to the
requirements of Paragraph 13(b).

     (b) If Tenant makes any Alterations pursuant to this Paragraph 13 or as
required by Paragraph 12 or 17 (such Alterations and actions being hereinafter
collectively referred to as "WORK"), whether or not Landlord's consent is
required, then (i) the market value of the Leased Premises shall not be lessened
by any such Work or its usefulness impaired, (ii) all such Work shall be
performed by Tenant in a good and workmanlike manner, (iii) all such Work shall
be expeditiously completed in compliance with all Legal Requirements, (iv) all
such Work shall comply with the Insurance Requirements, (v) if any such Work
involves the replacement of Equipment or parts thereto, all replacement
Equipment or parts shall have a value and useful life equal to the greater of
(A) the value and useful life on the date hereof of the Equipment being replaced
or (B) the value and useful life of the Equipment being replaced immediately
prior to the occurrence of the event which required its replacement (assuming
such replaced Equipment was then in the condition required by this Lease), (vi)
Tenant shall promptly discharge or remove all liens filed against any of the
Leased Premises arising out of such Work, (vii) Tenant shall procure and pay for
all permits and licenses required in connection with any such Work, (viii) all
such Work shall be the property of Landlord and shall be subject to this Lease,
and Tenant shall execute and deliver to Landlord any document requested by
Landlord evidencing the assignment to Landlord of all estate, right, title and
interest (other than the leasehold estate created hereby) of Tenant or any other
Person thereto or therein, and (ix) if the cost of such Alterations is in excess
of $500,000, Tenant shall comply, to the extent requested by Landlord or
required by this Lease, with the provisions of Paragraph 19(a)(i), whether or
not such Work involves restoration of the Leased Premises.

14.        PERMITTED CONTESTS. Notwithstanding any other provision of this
Lease, Tenant shall not be required to (a) pay any Imposition, (b) discharge or
remove any lien referred to in Paragraph 11 or 13 or (c) take any action with
respect to any encroachment, violation, hindrance, obstruction or impairment
referred to in Paragraph 12(b) (such non-compliance with the terms hereof being
hereinafter referred to collectively as "Permitted Violations") and may

                                      -19-
<PAGE>

dispute or contest the same, so long as at the time of such contest no Event of
Default exists and so long as Tenant shall contest, in good faith, the
existence, amount or validity thereof, the amount of the damages caused thereby,
or the extent of its or Landlord's liability therefor by appropriate proceedings
which shall operate during the pendency thereof to prevent or stay (i) the
collection of, or other realization upon, the Permitted Violation so contested,
(ii) the sale, forfeiture or loss of any of the Leased Premises or any Rent to
satisfy or to pay any damages caused by any Permitted Violation, (iii) any
interference with the use or occupancy of any of the Leased Premises, (iv) any
interference with the payment of any Rent, or (v) the cancellation or increase
in the rate of any insurance policy or a statement by the carrier that coverage
will be denied. Tenant shall provide Landlord security which is satisfactory, in
Landlord's reasonable judgment, to assure that such Permitted Violation is
corrected, including all Costs, interest and penalties that may be incurred or
become due in connection therewith. While any proceedings which comply with the
requirements of this Paragraph 14 are pending and the required security is held
by Landlord, Landlord shall not have the right to correct any Permitted
Violation thereby being contested unless Landlord is required by law to correct
such Permitted Violation and Tenant's contest does not prevent or stay such
requirement as to Landlord. Each such contest shall be promptly and diligently
prosecuted by Tenant to a final conclusion, except that Tenant, so long as the
conditions of this Paragraph 14 are at all times complied with, has the right to
attempt to settle or compromise such contest through negotiations. Tenant shall
pay any and all losses, judgments, decrees and Costs in connection with any such
contest and shall, promptly after the final determination of such contest, fully
pay and discharge the amounts which shall be levied, assessed, charged or
imposed or be determined to be payable therein or in connection therewith,
together with all penalties, fines, interest and Costs thereof or in connection
therewith, and perform all acts the performance of which shall be ordered or
decreed as a result thereof. No such contest shall subject Landlord to the risk
of any criminal liability or subject the Leased Premises to any proceeding in
condemnation.

15.        INDEMNIFICATION.

     (a) Tenant shall pay, protect, indemnify, defend, save and hold harmless
Landlord, Lender and all other Persons described in Paragraph 30 (each an
"INDEMNITEE") from and against any and all liabilities, losses, damages
(including punitive damages), penalties, Costs (including reasonable attorneys'
fees and costs), causes of action, suits, claims, demands or judgments of any
nature whatsoever, howsoever caused (unless caused by the gross negligence or
willful misconduct of Landlord), without regard to the form of action and
whether based on strict liability, negligence or any other theory of recovery at
law or in equity arising from (i) any matter pertaining to the acquisition (or
the negotiations leading thereto), ownership, use, non-use, occupancy,
operation, condition, design, construction, maintenance, repair or restoration
of the Leased Premises or Adjoining Property, (ii) any casualty in any manner
arising from the Leased Premises or Adjoining Property, whether or not
Indemnitee has or should have knowledge or notice of any defect or condition
causing or contributing to said casualty, (iii) any violation by Tenant of any
provision of this Lease, any contract or agreement to which Tenant is a party,
any Legal Requirement or any Permitted Encumbrance or any encumbrance Tenant
consented to or the Mortgage or Assignment or (iv) any alleged, threatened or
actual Environmental Violation, including (A) liability for response costs and
for costs of removal and remedial action incurred by the United States
Government, any state or local governmental unit or any other Person, or damages
from injury to or

                                      -20-
<PAGE>

destruction or loss of natural resources, including the reasonable costs of
assessing such injury, destruction or loss, incurred pursuant to Section 107 of
CERCLA, or any successor section or act or provision of any similar state or
local Law, (B) liability for costs and expenses of abatement, correction or
clean-up, fines, damages, response costs or penalties which arise from the
provisions of any of the other Environmental Laws and (C) liability for personal
injury or property damage arising under any statutory or common-law tort theory,
including damages assessed for the maintenance of a public or private nuisance
or for carrying on of a dangerous activity.

     (b) In case any action or proceeding is brought against any Indemnitee by
reason of any such claim, (i) Tenant may, except in the event of a conflict of
interest or a dispute between Tenant and any such Indemnitee or during the
continuance of an Event of Default, retain its own counsel and defend such
action (it being understood that Landlord may employ counsel of its choice to
monitor the defense of any such action, the reasonable cost of which (not to
exceed $10,000 per action or proceeding per calendar year unless such costs are
incurred in connection with the deposition(s) of the officers of Landlord or its
Affiliates in which case such cap on costs shall not apply) shall be paid by
Tenant) and (ii) such Indemnitee shall notify Tenant to resist or defend such
action or proceeding by retaining counsel reasonably satisfactory to such
Indemnitee, and such Indemnitee will cooperate and assist in the defense of such
action or proceeding if reasonably requested so to do by Tenant. In the event of
a conflict of interest or dispute or during the continuance of an Event of
Default, Landlord shall have the right to select counsel, and the reasonable
cost of such counsel shall by paid by Tenant.

     (c) The obligations of Tenant under this Paragraph 15 shall survive any
termination, expiration or rejection in bankruptcy of this Lease.

16.        INSURANCE.

     (a) Tenant shall maintain the following insurance on or in connection with
the Leased Premises:

           (i) Insurance against risk of physical loss or damage to the
Improvements and Equipment as provided under an "All Risk" form subject to
standard exclusions but not excluding perils of hail, windstorm, flood coverage
(if the Leased Premises is in a flood zone), earthquake and, to the extent
required by Lender, terrorism insurance, in amounts no less than the actual
replacement cost of the Improvements and Equipment; provided that, if Tenant's
insurance company is unable or unwilling to include any of all of such excluded
perils, Tenant shall have the option of purchasing coverage against such perils
from another insurer on a "Difference in Conditions" form or through a
stand-alone policy. Such policies shall contain Replacement Cost and Agreed
Amount Endorsements and shall contain deductibles not more than $100,000 per
occurrence.

           (ii) Commercial General Liability Insurance (including but not
limited to Incidental Medical Malpractice Liability) and Business Automobile
Liability Insurance (including Non-Owned and Hired Automobile Liability) against
claims for personal and bodily injury, death or property damage occurring on, in
or as a result of the use of the Leased Premises, in an amount not less than
$10,000,000 per occurrence/annual aggregate and

                                      -21-
<PAGE>

all other coverage extensions that are usual and customary for properties of
this size and type provided, however, that the Landlord shall have the right to
require such higher limits as may be reasonable and customary for properties of
this size and type.

           (iii) Workers' compensation insurance covering all persons employed
by Tenant in connection with any work done on or about any of the Leased
Premises for which claims for death, disease or bodily injury may be asserted
against Landlord, Tenant or any of the Leased Premises or, in lieu of such
Workers' Compensation Insurance, a program of self-insurance complying with the
rules, regulations and requirements of the appropriate agency of the State.

           (iv) The All-Risk policy required in (i) above shall include Boiler
and Machinery coverage on any of the Equipment or any other equipment on or in
the Leased Premises. The All-Risk policy required in (i) above shall include at
least $3,000,000 per occurrence for Off-Premises Service Interruption, and/or
Expediting Expenses and Decontamination Expense and may contain a deductible not
to exceed $100,000, and a waiting period of 24 hours.

           (v) Business Interruption/Extra Expense Insurance at limits
sufficient to cover 100% of the period of indemnity not less than eighteen (18)
months from time of loss. Such insurance shall name Landlord as loss payee
solely with respect to Rent payable to or for the benefit of Landlord as its
interest appears under this Lease.

           (vi) During any period in which substantial Alterations at the Leased
Premises are being undertaken, builder's risk insurance covering the total
completed value including "soft costs" (such as the cost of permits,
architectural costs, taxes and the like) with respect to the Improvements being
altered or repaired (on a completed value, non-reporting basis), replacement
cost of work performed and equipment, supplies and materials furnished in
connection with such construction or repair of Improvements or Equipment,
together with such "soft cost" endorsements and such other endorsements as
Landlord may reasonably require and general liability, worker's compensation and
automobile liability insurance with respect to the Improvements being
constructed, altered or repaired.

           (vii) Such other insurance (or other terms with respect to any
insurance required pursuant to this Paragraph 16, including without limitation
amounts of coverage, deductibles, form of mortgagee clause) on or in connection
with any of the Leased Premises as Landlord or Lender may reasonably require and
is customary for properties similarly situated to this location, use and
occupancy.

     (b) The insurance required by Paragraph 16(a) shall be written by companies
which have a Best's rating of A:VII or above and a claims paying ability rating
of A or better by Standard & Poor's Rating Services, a division of the McGraw
Hill Companies, Inc. or equivalent rating agency approved by Landlord and Lender
in their sole discretion and are admitted in, and approved to write insurance
policies by, the State Insurance Department for the State of New Jersey.
Notwithstanding the foregoing, on the Commencement Date Landlord and Lender
shall accept policies written by companies which have a minimum Best's rating of
A:XV without regard to their Standard & Poors claims paying ability rating,
subject to the condition

                                      -22-
<PAGE>

that if Lender shall at anytime in the future require policies written by
companies with a claims paying ability rating of A from Standard & Poor's Rating
Services, Tenant agrees, within fifteen (15) days following notice from
Landlord, either to obtain such replacement policies or, if Lender shall so
require, to deposit with Landlord the sum of $100,000 (or make a corresponding
increase in the Letter of Credit (as hereinafter defined) or provide an
additional Letter of Credit) as additional security for its obligations under
this Lease, and such sums shall be considered part of the Security Deposit, to
be held and applied as provided for in Paragraph 36. If at any time after Tenant
shall have made such additional $100,000 Security Deposit, Tenant obtains
replacement policies with the required rating as set forth above, Landlord shall
promptly return to Tenant the additional $100,000 Security Deposit (or consent
to a reduction or return of the Letter of Credit, as the case may be). The
insurance policies (i) shall be for a term of at least one year and (ii) shall
be in amounts sufficient at all times to satisfy any coinsurance requirements
thereof. The insurance referred to in Paragraphs 16(a)(i), 16(a)(iv) and the
builder risk insurance required in Paragraph 16(a)(vi) shall name Landlord as
additional insured and Landlord and Lender as loss payee and Tenant as its
interest may appear. The insurance referred to in Paragraph 16(a)(ii) shall name
Landlord and Lender as additional insureds, and the insurance referred to in
Paragraph 16(a)(v) shall name Landlord as insured and Lender and Landlord as
loss payee as to rent payable to Landlord. If said insurance or any part thereof
shall expire, be withdrawn, become void, voidable, unreliable or unsafe for any
reason, including a breach of any condition thereof by Tenant or the failure or
impairment of the capital of any insurer, or if for any other reason whatsoever
said insurance shall become reasonably unsatisfactory to Landlord, Tenant shall
immediately obtain new or additional insurance reasonably satisfactory to
Landlord.

     (c) Each insurance policy referred to in clauses (i), (iv), (v) and the
builder's risk insurance required in clause (vi) of Paragraph 16(a) shall
contain standard non-contributory mortgagee clauses in favor of and acceptable
to Lender. Each policy required by any provision of Paragraph 16(a), except
clause (iii) thereof, shall provide that it may not be cancelled, substantially
modified or allowed to lapse on any renewal date except after thirty (30) days'
prior notice to Landlord and Lender. Each such policy shall also provide that
any loss otherwise payable thereunder shall be payable notwithstanding (i) any
act or omission of Landlord or Tenant which might, absent such provision, result
in a forfeiture of all or a part of such insurance payment, (ii) the occupation
or use of any of the Leased Premises for purposes more hazardous than those
permitted by the provisions of such policy, (iii) any foreclosure or other
action or proceeding taken by Lender pursuant to any provision of the Mortgage,
Note, Assignment or other document evidencing or securing the Loan upon the
happening of an event of default therein or (iv) any change in title to or
ownership of any of the Leased Premises.

     (d) Unless Tenant is making Escrow Payments under Paragraph 9(b), Tenant
shall pay as they become due all premiums for the insurance required by
Paragraph 16(a), and shall deliver to Landlord evidence of the payment of the
full premium therefor or installment then due, which evidence shall be by an
annual certificate of an officer of Tenant delivered to Landlord by January 31
of each Lease Year during the Term. At least thirty (30) days prior to the
expiration date of such policy, Tenant shall renew or replace each policy.
Within sixty (60) days after the renewal or replacement of each policy, Tenant
shall deliver to Landlord an original certificate of insurance for such policy,
which certificate shall bear a notation evidencing payment of applicable premium
for such policy. If required by Lender, Tenant shall deliver to

                                      -23-
<PAGE>

Landlord certified copies of the policies reasonably promptly as they become
available, but in no event later than sixty (60) days after the renewal date for
such policy.

     (e) Anything in this Paragraph 16 to the contrary notwithstanding, any
insurance which Tenant is required to obtain pursuant to Paragraph 16(a) may be
carried under a "blanket" or umbrella policy or policies covering other
properties or liabilities of Tenant, provided that such "blanket" or umbrella
policy or policies otherwise comply with the provisions of this Paragraph 16 and
provided further that Tenant shall provide to Landlord a Statement of Values
which shall be reviewed annually and amended as necessary based on Replacement
Cost Valuations.

     (f) Tenant shall promptly comply with and conform to (i) all provisions of
each insurance policy required by this Paragraph 16 and (ii) all requirements of
the insurers thereunder applicable to Landlord, Tenant or any of the Leased
Premises or to the use, manner of use, occupancy, possession, operation,
maintenance, alteration or repair of any of the Leased Premises, even if such
compliance necessitates Alterations or results in interference with the use or
enjoyment of any of the Leased Premises.

     (g) Except for funding deductible amounts as deemed appropriate by Tenant
(but not in excess of the deductible permitted under Paragraph 16(a)), Tenant
shall not carry separate insurance concurrent in form or contributing in the
event of a Casualty with that required in this Paragraph 16 unless (i) Landlord
and Lender are included therein as an insured, with loss payable as provided
herein, and (h) such separate insurance complies with the other provisions of
this Paragraph 16. Tenant shall immediately notify Landlord of such separate
insurance and, if required by Lender, shall deliver to Landlord certified copies
of the policies reasonably promptly as they become available.

     (h) All policies shall contain effective waivers by the insurer against all
claims for insurance premiums against Landlord and shall contain full waivers of
subrogation against the Landlord.

     (i) All proceeds of any insurance required under Paragraph 16(a) shall be
payable as follows:

           (i) Proceeds payable under clauses (ii), (iii) and (iv) of Paragraph
16(a) and proceeds attributable to the general liability coverage of Builder's
Risk insurance under clause (vi) of Paragraph 16(a) shall be payable to the
Person entitled to receive such proceeds.

           (ii) Proceeds of insurance required under clause (i) of Paragraph
16(a) and proceeds attributable to Builder's Risk insurance under clause (vi) of
Paragraph 16(a) shall be payable to Landlord or Lender and applied as set forth
in Paragraph 17 or, if applicable, Paragraph 18. Tenant shall apply the Net
Award to restoration of the Leased Premises in accordance with the applicable
provisions of this Lease unless a Termination Event shall have occurred and
Tenant has given a Termination Notice.

                                      -24-
<PAGE>

17.        CASUALTY AND CONDEMNATION.

     (a) If any Casualty to the Leased Premises occurs, Tenant shall give
Landlord and Lender immediate notice thereof. So long as no Event of Default
exists Tenant is hereby authorized to adjust, collect and compromise all claims
under any of the insurance policies required by Paragraph 16(a) (except public
liability insurance claims payable to a Person other than Tenant, Landlord or
Lender) and to execute and deliver on behalf of Landlord all necessary proofs of
loss, receipts, vouchers and releases required by the insurers and Landlord
shall have the right to join with Tenant therein. The final adjustment,
settlement or compromise of any claim in excess of $500,000 shall be subject to
the prior written approval of Landlord, and Landlord shall have the right to
prosecute or contest, or to require Tenant to prosecute or contest, such claim,
adjustment, settlement or compromise. Notwithstanding the foregoing, in the
event that any such adjustment, settlement or compromise shall be for not less
than 100% of the replacement cost of that portion of the Leased Premises damaged
by such Casualty, Landlord's consent to such adjustment, settlement or
compromise shall not be required. If an Event of Default exists, Tenant shall
not be entitled to adjust, collect or compromise any such claim or to
participate with Landlord in any adjustment, collection and compromise of the
Net Award payable in connection with a Casualty. Tenant agrees to sign, upon the
request of Landlord, all such proofs of loss, receipts, vouchers and releases.
Each insurer is hereby authorized and directed to make payment under said
policies, including return of unearned premiums, directly to Landlord or, if
required by the Mortgage, to Lender instead of to Landlord and Tenant jointly,
and Tenant hereby appoints each of Landlord and Lender as Tenant's
attorneys-in-fact to endorse any draft therefor. The rights of Landlord under
this Paragraph 17(a) shall be extended to Lender if and to the extent that any
Mortgage so provides.

     (b) Tenant, immediately upon receiving a Condemnation Notice, shall notify
Landlord and Lender thereof. So long as no Event of Default exists, Tenant is
authorized to collect, settle and compromise the amount of any Net Award and
Landlord shall have the right to join with Tenant herein. If an Event of Default
exists, Landlord shall be authorized to collect, settle and compromise the
amount of any Net Award and Tenant shall not be entitled to participate with
Landlord in any Condemnation proceeding or negotiations under threat thereof or
to contest the Condemnation or the amount of the Net Award therefor. No
agreement with any condemnor in settlement or under threat of any Condemnation
shall be made by Tenant without the written consent of Landlord. Subject to the
provisions of this Paragraph 17(b), Tenant hereby irrevocably assigns to
Landlord any award or payment to which Tenant is or may be entitled by reason of
any Condemnation, whether the same shall be paid or payable for Tenant's
leasehold interest hereunder or otherwise; but nothing in this Lease shall
impair Tenant's right to any award or payment on account of Tenant's trade
fixtures, equipment or other tangible property which is not part of the
Equipment, moving expenses or loss of business, if available, to the extent that
and so long as (i) Tenant shall have the right to make, and does make, a
separate claim therefor against the condemnor and (ii) such claim does not in
any way reduce either the amount of the award otherwise payable to Landlord for
the Condemnation of Landlord's fee interest in the Improvements and Equipment
and leasehold interest in the Land or the amount of the award (if any) otherwise
payable for the Condemnation of Tenant's leasehold interest hereunder. The
rights of Landlord under this Paragraph 17(b) shall also be extended to Lender
if and to the extent that any Mortgage so provides.

                                      -25-
<PAGE>

     (c) If any Partial Casualty (whether or not insured against) or Partial
Condemnation shall occur, this Lease shall continue, notwithstanding such event,
and there shall be no abatement or reduction of any Monetary Obligations.
Promptly after such Partial Casualty or Partial Condemnation, Tenant, as
required in Paragraph 12(a), shall commence and diligently continue to restore
the Leased Premises as nearly as possible to their value, condition and
character immediately prior to such event (assuming the Leased Premises to have
been in the condition required by this Lease). So long as no Event of Default
exists, any Net Award up to and including $500,000 shall be paid by Landlord to
Tenant and Tenant shall restore the Leased Premises in accordance with the
requirements of Paragraph 13(b) of this Lease. Any Net Award in excess of
$500,000 shall (unless such Casualty resulting in the Net Award is a Termination
Event) be made available by Landlord (or Lender if the terms of the Mortgage so
require) to Tenant for the restoration of any of the Leased Premises pursuant to
and in accordance with and subject to the provisions of Paragraph 19 hereof. If
any Casualty or Condemnation which is not a Partial Casualty or Partial
Condemnation shall occur, Tenant shall comply with the terms and conditions of
Paragraph 18.

18.        TERMINATION EVENTS.

     (a) If either (i) the entire Leased Premises shall be taken by a Taking or
(ii) any substantial portion of the Leased Premises shall be taken by a Taking
or all or any substantial portion of the Leased Premises shall be damaged or
destroyed by a Casualty and, in such case, Tenant certifies and covenants to
Landlord that it will forever abandon operations at the Leased Premises (each of
the events described in the above clauses (i) and (ii) shall hereinafter be
referred to as a "TERMINATION EVENT"), then (x) in the case of (i) above, Tenant
shall be obligated, within ninety (90) days after Tenant receives a Condemnation
Notice and (y) in the case of (ii) above, Tenant shall have the option, within
ninety (90) days after Tenant receives a Condemnation Notice or ninety (90) days
after the Casualty, as the case may be, to give to Landlord written notice in
the form described in Paragraph 18(b) of the Tenant's election to terminate this
Lease (a "TERMINATION NOTICE"). If Tenant elects under clause (y) above not to
give Landlord a Termination Notice, then Tenant shall rebuild or repair the
Leased Premises in accordance with Paragraphs 17 and 19.

     (b) A Termination Notice shall contain (i) notice of Tenant's intention to
terminate this Lease on the first Basic Rent Payment Date which occurs at least
sixty (60) days after the Fair Market Value Date (the "TERMINATION DATE"), (ii)
a binding and irrevocable offer of Tenant to pay to Landlord the Termination
Amount and (iii) if the Termination Event is an event described in Paragraph
18(a)(ii), the certification and covenants described therein and a certified
resolution of the Board of Directors of Tenant authorizing the same. Promptly
upon the delivery to Landlord of a Termination Notice, Landlord and Tenant shall
commence to determine the Fair Market Value.

     (c) If Landlord shall reject such offer by Tenant to pay to Landlord the
Termination Amount pursuant to Paragraph 18(b) above by written notice to Tenant
(a "REJECTION"), which Rejection shall contain the written consent of Lender to
Landlord's rejection of Tenant's offer to pay the Termination Amount, not later
than thirty (30) days following the Fair Market Value Date, then this Lease
shall terminate on the Termination Date; provided that, if Tenant has not
satisfied all Monetary Obligations and all other obligations and liabilities
under

                                      -26-
<PAGE>

this Lease which have arisen on or prior to the Termination Date (collectively,
"REMAINING OBLIGATIONS") on the Termination Date, then Landlord may, at its
option, extend the date on which this Lease may terminate to a date which is no
later than the first Basic Rent Payment Date after the Termination Date on which
Tenant has satisfied all Remaining Obligations. Upon such termination (i) all
obligations of Tenant hereunder shall terminate except for any Surviving
Obligations, (ii) Tenant shall immediately vacate and shall have no further
right, title or interest in or to any of the Leased Premises and (iii) the Net
Award shall be retained by Landlord. Notwithstanding anything to the contrary
hereinabove contained, if Tenant shall have received a Rejection and, on the
date when this Lease would otherwise terminate, Landlord shall not have received
the full amount of the Net Award payable by reason of the applicable Termination
Event, then the date on which this Lease is to terminate shall be automatically
extended to the first Basic Rent Payment Date after the receipt by Landlord of
the full amount of the Net Award provided that, if Tenant has not satisfied all
Remaining Obligations on such date, then Landlord may, at its option, extend the
date on which this Lease may terminate to a date which is no later than the
first Basic Rent Payment Date after such date on which Tenant has satisfied all
such Remaining Obligations.

     (d) Unless Tenant shall have received a Rejection not later than the
thirtieth (30th) day following the Fair Market Value Date, Landlord shall be
conclusively presumed to have accepted such offer from Tenant to pay the
Termination Amount. If such offer from Tenant to pay the Termination Amount is
accepted by Landlord then, on the Termination Date, Tenant shall pay to Landlord
the Termination Amount and all Remaining Obligations and, if requested by
Tenant, Landlord shall (i) convey to Tenant the Leased Premises or the remaining
portion thereof, if any, and (ii) pay to or assign to Tenant Landlord's entire
interest in and to the Net Award, all in accordance with Paragraph 20.

19.        RESTORATION.

     (a) If any Net Award is in excess of $500,000, Landlord (or Lender if
required by any Mortgage) shall hold the entire Net Award in a fund (the
"RESTORATION FUND") and disburse amounts from the Restoration Fund only in
accordance with the following conditions:

           (i) prior to commencement of restoration, (A) the architects,
contracts, contractors, plans and specifications and a budget for the
restoration shall have been approved by Landlord in its reasonable discretion
and (B) Landlord and Lender shall be provided with mechanics' lien insurance (if
available) and reasonably acceptable performance and payment bonds which insure
satisfactory completion of and payment for the restoration, are in an amount and
form and have a surety reasonably acceptable to Landlord, and name Landlord and
Lender as additional dual obligees;

           (ii) at the time of any disbursement, no Event of Default shall exist
and no mechanics' or materialmen's liens shall have been filed against any of
the Leased Premises and remain undischarged;

           (iii) disbursements shall be made from time to time in an amount not
exceeding the cost of the work completed since the last disbursement, upon
receipt of

                                      -27-
<PAGE>

(A) satisfactory evidence, including architects' certificates, of the stage of
completion, the estimated total cost of completion and performance of the work
to date in a good and workmanlike manner in accordance with the contracts, plans
and specifications, (B) waivers of liens, (C) contractors' and subcontractors'
sworn statements as to completed work and the cost thereof for which payment is
requested, (D) a satisfactory bringdown of title insurance and (E) other
evidence of cost and payment so that Landlord can verify that the amounts
disbursed from time to time are represented by work that is completed, in place
and free and clear of mechanics' and materialmen's lien claims;

           (iv) each request for disbursement shall be accompanied by a
certificate of Tenant, signed by the president or a vice president of Tenant,
describing the work for which payment is requested, stating the cost incurred in
connection therewith, stating that Tenant has not previously received payment
for such work and, upon completion of the work, also stating that the work has
been fully completed and complies with the applicable requirements of this
Lease;

           (v) Landlord may retain ten percent (10%) of the restoration fund
until the restoration is fully completed;

           (vi) if the Restoration Fund is held by Landlord, the Restoration
Fund shall not be commingled with Landlord's other funds and shall bear interest
at a rate agreed to by Landlord and Tenant; and

           (vii) such other reasonable conditions as Landlord or Lender may
impose.

     (b) Prior to commencement of restoration and at any time during
restoration, if the estimated cost of completing the restoration work free and
clear of all liens, as determined by Landlord, exceeds the amount of the Net
Award available for such restoration, upon demand by Landlord, Tenant shall pay
to Landlord the amount of such excess to be added to the Restoration Fund or
shall provide other evidence satisfactory to Landlord that funds will be
available from Tenant to complete restoration. Any sum so added by Tenant which
remains in the Restoration Fund upon completion of restoration shall be refunded
to Tenant. For purposes of determining the source of funds with respect to the
disposition of funds remaining after the completion of restoration, the Net
Award shall be deemed to be disbursed prior to any amount added by Tenant.

     (c) If any sum remains in the Restoration Fund after completion of the
restoration and any refund to Tenant pursuant to Paragraph 19(b), such sum shall
be retained by Landlord or, if required by a Note or Mortgage, paid by Landlord
to a Lender.

20.        PROCEDURES UPON PURCHASE.

     (a) If the Leased Premises is purchased by Tenant pursuant to any provision
of this Lease, Landlord need not convey any better title thereto than that which
was conveyed to Landlord, and Tenant shall accept such title, subject, however,
to the Permitted Encumbrances and to all other liens, exceptions and
restrictions on, against or relating to any of the Leased Premises and to all
applicable Laws, but free of the lien of and security interest

                                      -28-
<PAGE>

created by any Mortgage or Assignment and liens, exceptions and restrictions on,
against or relating to the Leased Premises which have been created by or
resulted solely from acts of Landlord after the date of this Lease, unless the
same are Permitted Encumbrances or customary utility easements benefiting the
Leased Premises or were created with the written concurrence of Tenant or as a
result of a default by Tenant under this Lease.

     (b) Upon the date fixed for any such purchase of the Leased Premises
pursuant to any provision of this Lease (any such date the "PURCHASE DATE"),
Tenant shall pay to Landlord, or to any Person to whom Landlord directs payment,
the Relevant Amount therefor specified herein, in Federal Funds, less any credit
of the Net Award received and retained by Landlord or a Lender allowed against
the Relevant Amount, and Landlord shall deliver to Tenant (i) an assignment of
the Ground Lease and a special warranty deed to the Improvements which describe
the premises being conveyed and conveys the title thereto as provided in
Paragraph 20(a), (ii) such other instruments as shall be necessary to transfer
to Tenant or its designee any other property (or rights to any Net Award not yet
received by Landlord or a Lender) then required to be sold by Landlord to Tenant
pursuant to this Lease and (iii) any Net Award received by Landlord, not
credited to Tenant against the Relevant Amount and required to be delivered by
Landlord to Tenant pursuant to this Lease; provided, that if any Monetary
Obligations remain outstanding on such date, then Landlord may deduct from the
Net Award the amount of such Monetary Obligations. If on the Purchase Date any
Monetary Obligations remain outstanding and no Net Award is payable to Tenant by
Landlord or the amount of such Net Award is less than the amount of the Monetary
Obligations, then Tenant shall pay to Landlord on the Purchase Date the amount
of such Monetary Obligations. Upon the completion of such purchase, this Lease
and all obligations and liabilities of Tenant hereunder shall terminate, except
any Surviving Obligations.

     (c) If the completion of such purchase shall be delayed after (i) the
Termination Date, in the event of a purchase pursuant to Paragraph 18 or, (ii)
the date scheduled for such purchase, in the event of a purchase under any other
provision of this Lease then (x) Rent shall continue to be due and payable until
completion of such purchase and (y) at Landlord's sole option, but only if such
delay exceeds sixty (60) days, Fair Market Value shall be redetermined and the
Relevant Amount payable by Tenant pursuant to the applicable provision of this
Lease shall be adjusted to reflect such redetermination.

     (d) Any prepaid Monetary Obligations paid to Landlord shall be prorated as
of the Purchase Date, and the prorated unapplied balance shall be deducted from
the Relevant Amount due to Landlord; provided, that no apportionment of any
Impositions shall be made upon any such purchase.

21.        ASSIGNMENT AND SUBLETTING, PROHIBITION AGAINST LEASEHOLD FINANCING.

     (a)

           (i) Tenant shall have the right, upon thirty (30) days prior written
notice to Landlord and Lender, with no consent of Landlord or Lender being
required or necessary ("Preapproved Assignment") to assign this Lease by
operation of law or otherwise to any Person ("Preapproved Assignee") that
immediately following such assignment (A) will have

                                      -29-
<PAGE>

a publicly traded unsecured senior debt rating of "Baa1" or better from Moody's
or a rating of "BBB+" or better from S&P, or, if applicable, another Rating
Agency or (B) is, and at all times while such person shall be a tenant hereunder
continues to be, an Affiliate of Guarantors.

           (ii) If Tenant desires to assign this Lease, whether by operation of
law or otherwise, to a Person ("NON-PREAPPROVED ASSIGNEE") who would not be a
Preapproved Assignee ("NON-PREAPPROVED ASSIGNMENT") then Tenant shall, not less
than ninety (90) days prior to the date on which it desires to make a
Non-Preapproved Assignment submit to Landlord and Lender information regarding
the following with respect to the Non-Preapproved Assignee (collectively, the
"REVIEW CRITERIA"): (A) credit, (B) capital structure, (C) management, (D)
operating history, (E) proposed use of the Leased Premises and (F) risk factors
associated with the proposed use of the Leased Premises by the Non-Preapproved
Assignee, taking into account factors such as environmental concerns, product
liability and the like. Landlord and Lender shall review such information and
shall approve or disapprove the Non-Preapproved Assignee no later than the
thirtieth (30th) day following receipt of all such information, and Landlord and
Lender shall be deemed to have acted reasonably in granting or withholding
consent if such grant or disapproval is based on their review of the Review
Criteria applying prudent business judgment. If a response is not received by
Landlord and Lender by the expiration of such thirty (30) day period, such
non-Preapproved Assignee shall be deemed disapproved.

     (b) Tenant shall have the right, upon thirty (30) days' prior written
notice to Landlord and Lender, to enter into one or more subleases that demise,
in the aggregate, up to but not in excess of forty percent (40%) of the gross
space in the Improvements with no consent or approval of Landlord being required
or necessary ("PREAPPROVED SUBLET"). Other than pursuant to Preapproved Sublets,
at no time during the Term shall subleases exist for more than forty percent
(40%) of the gross space in the Improvements without the prior written consent
of Landlord, which consent shall be granted or withheld based on a review of the
Review Criteria as they relate to the proposed sublessee and the terms of the
proposed sublease. Landlord and Lender shall be deemed to have acted reasonably
in granting or withholding consent if such grant or disapproval is based on
their review of the Review Criteria applying prudent business judgment.

     (c) If Tenant assigns all its rights and interest under this Lease, the
assignee under such assignment shall expressly assume all the obligations of
Tenant hereunder, actual or contingent, including obligations of Tenant which
may have arisen on or prior to the date of such assignment, by a written
instrument delivered to Landlord at the time of such assignment. Any approved
sublease of the Leased Premises shall (A) be expressly subject and subordinate
to this Lease and any Mortgage encumbering the Leased Premises; (B) not extend
beyond the then current Term minus one day; (C) terminate upon any termination
of this Lease, unless Landlord elects in writing, to cause the sublessee to
attorn to and recognize Landlord as the lessor under such sublease, whereupon
such sublease shall continue as a direct lease between the sublessee and
Landlord upon all the terms and conditions of such sublease; and (D) bind the
sublessee to all covenants contained in Paragraphs 4(a), 10 and 12 with respect
to subleased premises to the same extent as if the sublessee were the Tenant. No
assignment or sublease shall affect or reduce any of the obligations of Tenant
hereunder or the Guarantor under the Guaranty, and all such obligations of
Tenant and Guarantor shall continue in full force and effect as obligations of a
principal and not as obligations of a guarantor, as if no assignment or sublease

                                      -30-
<PAGE>

had been made. No assignment or sublease shall impose any additional obligations
on Landlord under this Lease.

     (d) With respect to any Preapproved Assignment or Preapproved Sublet,
Tenant shall provide to Landlord information reasonably required by Landlord to
establish that any proposed Preapproved Assignment or Preapproved Sublet
satisfies the criteria set forth above.

     (e) Tenant shall, within ten (10) days after the execution and delivery of
any assignment or sublease, deliver a duplicate original copy thereof to
Landlord which, in the event of an assignment, shall be in recordable form.

     (f) As security for performance of its obligations under this Lease, Tenant
hereby grants, conveys and assigns to Landlord all right, title and interest of
Tenant in and to all subleases now in existence or hereafter entered into for
any or all of the Leased Premises, any and all extensions, modifications and
renewals thereof and all rents, issues and profits therefrom. Landlord hereby
grants to Tenant a license to collect and enjoy all rents and other sums of
money payable under any sublease of any of the Leased Premises, provided,
however, that Landlord shall have the absolute right at any time upon notice to
Tenant and any subtenants to revoke said license and to collect such rents and
sums of money and to retain the same. Any amounts so collected by Landlord shall
be applied to Rent next due and owing. Tenant shall not accept any rents under
any sublease more than thirty (30) days in advance of the accrual thereof.

     (g) Except as otherwise specifically permitted under Paragraph 37, Tenant
shall not have the power to mortgage, pledge or otherwise encumber its interest
under this Lease or any sublease of the Leased Premises, and any such mortgage,
pledge or encumbrance made in violation of this Paragraph 21 shall be void and
of no force and effect.

     (h) Subject to the provisions of Paragraph 35 hereof, Landlord may sell or
transfer the Leased Premises at any time without Tenant's consent to any third
party (each a "THIRD PARTY PURCHASER"). In the event of any such transfer,
Tenant shall attorn to any Third Party Purchaser as Landlord so long as such
Third Party Purchaser and Landlord notify Tenant in writing of such transfer. At
the request of Landlord, Tenant will execute such documents confirming the
agreement referred to above and such other agreements as Landlord may reasonably
request, provided that such agreements do not increase the liabilities and
obligations of Tenant hereunder.

22.        EVENTS OF DEFAULT.

     (a) The occurrence of any one or more of the following (after expiration of
any applicable cure period as provided in Paragraph 22(b)) shall, at the sole
option of Landlord, constitute an "EVENT OF DEFAULT" under this Lease:

           (i) a failure by Tenant to make any payment of any Monetary
Obligation on or prior to its due date, taking into account any applicable
notice and/or cure period under Paragraph 22(b) with respect to such payment, if
any, regardless of the reason for such failure;

                                      -31-
<PAGE>

           (ii) a failure by Tenant duly to perform and observe, or a violation
or breach of, any other provision hereof not otherwise specifically mentioned in
this Paragraph 22(a) on or prior to the deadline for such performance under this
Lease, taking into account any applicable notice and/or cure period under
Paragraph 22(b) with respect to such performance, if any;

           (iii) any representation or warranty made by Tenant herein or in any
certificate, demand or request made pursuant hereto proves to be incorrect in
any material respect as of the date made;

           (iv) a default beyond any applicable notice and/or cure period or at
maturity by Tenant or any of the Guarantors in any payment of principal or
interest on any obligations for borrowed money having at the time of such
default an outstanding principal balance of $10,000,000 (or its equivalent in
any foreign currencies) or more in the aggregate, or in the performance of any
other provision contained in any instrument under which any such obligation is
created or secured (including the breach of any covenant thereunder), (x) if
such payment is a payment at maturity or a final payment, or (y) if an effect of
such default is to cause, or permit any Person to cause, such obligation to
become due prior to its stated maturity;

           (v) a default by Tenant beyond any applicable notice and/or cure
period in the payment of rent under, or in the performance of any other material
provision of, any other lease or leases that have, in the aggregate, rental
obligations remaining over the balance of the terms thereof of $7,500,000 or
more, but only if the landlord under any such lease or leases commences to
exercise its remedies thereunder;

           (vi) a final, non-appealable judgment or judgments for the payment of
money in excess of $5,000,000 (or its equivalent in any foreign currencies) in
the aggregate shall be rendered against Tenant or any of the Guarantors and the
same shall remain undischarged or unstayed for a period of sixty (60)
consecutive days after it is entered; provided, however, that amounts which are
covered by insurance provided by a reputable insurance company which has not
denied coverage in any way and has agreed in writing to provide Tenant's defense
shall not be included in the foregoing;

           (vii) The breach of any Covenant shall occur; provided, however, that
no such breach shall be deemed to have occurred until the expiration of any
applicable notice and/or cure period under the Credit Agreement or Senior Credit
Agreement, as the case may be, with respect to such Covenant;

           (viii) Tenant or any of the Guarantors shall (A) voluntarily be
adjudicated a bankrupt or insolvent, (B) seek or consent to the appointment of a
receiver or trustee for itself or for the Leased Premises, (C) file a petition
seeking relief under the bankruptcy or other similar laws of the United States,
any state or any jurisdiction, (D) make a general assignment for the benefit of
creditors, or (E) admit in writing its inability to pay its debts as they
mature;

           (ix) a court shall enter an order, judgment or decree appointing,
without the consent of Tenant, a receiver or trustee for it or for any of the
Leased Premises or

                                      -32-
<PAGE>

approving a petition filed against Tenant which seeks relief under the
bankruptcy or other similar laws of the United States, any state or any
jurisdiction, and such order, judgment or decree shall remain undischarged or
unstayed for a period of sixty (60) consecutive days after it is entered;

           (x) the Leased Premises shall have been (a) vacated for more than
ninety (90) consecutive days, unless during such ninety (90) day period Tenant
is restoring or renovating the Leased Premises, or is diligently attempting to
sublet the Leased Premises and is otherwise in compliance with the terms of this
Lease, or (b) abandoned, as evidenced by Tenant's failure to maintain dominion
and control over the Leased Premises;

           (xi) Tenant shall be liquidated or dissolved or begin proceedings
towards its liquidation or dissolution unless this Lease shall have been
assigned to an Affiliate as part of a corporate reorganization;

           (xii) the estate or interest of Tenant in any of the Leased Premises
shall be levied upon or attached in any proceeding and such estate or interest
is about to be sold or transferred or such process shall not be vacated or
discharged within sixty (60) days after it is made;

           (xiii) a failure by Tenant to perform or observe, or a material
violation or breach of, or a material misrepresentation by Tenant under any
provision of any Assignment or any other document between Tenant and Lender or
from Tenant to Lender, if such failure, violation, breach or misrepresentation
gives rise to a default beyond any applicable cure period with respect to any
Loan;

           (xiv) a failure by Tenant to maintain in effect any material license
or permit necessary for the use, occupancy or operation of the Leased Premises;

           (xv) Tenant shall fail to deliver the estoppel described in Paragraph
25 within the time period specified therein;

           (xvi) Tenant shall sell or transfer or enter into an agreement to
sell or transfer all or substantially all of its assets in a single transaction
or a series of related transactions except for a sale or transfer to a Person
permitted under Paragraph 21(a) who assumes all of the obligations of Tenant
under this Lease and only if such sale or transfer is otherwise is compliance
with Paragraph 21(a);

           (xvii) an Event of Default (as defined in the Guaranty) shall occur
under the Guaranty;

           (xviii) Tenant shall fail to renew the Letter of Credit or replenish
the Security Deposit in accordance with the requirements of Paragraph 36;

           (xix) Tenant shall fail to comply with all of the obligations of
Landlord, as tenant, under the Ground Lease and such failure shall continue
beyond the expiration of any notice and cure period, or

                                      -33-
<PAGE>

           (xx) Tenant shall fail to comply with all of the obligations of
Landlord under the CC&R, including but not limited to the failure of Tenant to
pay any Quarterly Assessments or Special Assessments, and such failure shall
continue beyond the expiration of any notice and cure period set forth in the
CC&R.

     (b) No notice or cure period shall be required in any one or more of the
following events: (A) the occurrence of an Event of Default under clause (i)
(except as otherwise set forth below), (iv), (v), (vi), (vii), (viii), (ix),
(x), (xi), (xii), (xiii), (xv), (xvi) (xvii), (xviii), (xix) or (xx) of
Paragraph 22(a); (B) the default consists of a failure to provide any insurance
required by Paragraph 16 or an assignment or sublease entered into in violation
of Paragraph 21; or (C) the default is such that any delay in the exercise of a
remedy by Landlord could reasonably be expected to cause irreparable harm to
Landlord. If the default consists of the failure to pay any Monetary Obligation
under clause (i) of Paragraph 22(a), the applicable cure period shall be five
(5) days from the date on which notice is given, but Landlord shall not be
obligated to give notice of, or allow any cure period for, any such default more
than once within any Lease Year. If the default consists of a default under
clause (ii), clause (iii) (provided that such misrepresentation is reasonably
susceptible of cure) or clause (xiv) of Paragraph 22(a), other than the events
specified in clauses (B) and (C) of the first sentence of this Paragraph 22(b),
the applicable cure period shall be twenty (20) days from the date on which
notice is given or, if the default cannot be cured within such twenty (20) day
period and delay in the exercise of a remedy would not (in Landlord's reasonable
judgment) cause any material adverse harm to Landlord or any of the Leased
Premises, the cure period shall be extended for the period required to cure the
default (but such cure period, including any extension, shall not in the
aggregate exceed sixty (60) days), provided that Tenant shall commence to cure
the default within the said twenty-day period and shall actively, diligently and
in good faith proceed with and continue the curing of the default until it shall
be fully cured.

23.        REMEDIES AND DAMAGES UPON DEFAULT.

     (a) If an Event of Default shall have occurred and is continuing, Landlord
shall have the right, at its sole option, then or at any time thereafter, to
exercise its remedies and to collect damages from Tenant in accordance with this
Paragraph 23, subject in all events to applicable Law, without demand upon or
notice to Tenant except as otherwise provided in Paragraph 22(b) and this
Paragraph 23. Such remedies upon an Event of Default may include the following:

           (i) Landlord may give Tenant notice of Landlord's intention to
terminate this Lease on a date specified in such notice. Upon such date, this
Lease, the estate hereby granted and all rights of Tenant hereunder shall expire
and terminate. Upon such termination, Tenant shall immediately surrender and
deliver possession of the Leased Premises to Landlord in accordance with
Paragraph 26. If Tenant does not so surrender and deliver possession of the
Leased Premises, Landlord may re-enter and repossess the Leased Premises, with
appropriate legal process, by summary proceedings, ejectment or any other lawful
judicial procedure. Upon or at any time after taking possession of the Leased
Premises, Landlord may, by peaceable means or legal process, remove any Persons
or property therefrom. Landlord shall be under no liability for or by reason of
any such entry, repossession or removal. Notwithstanding such entry or
repossession, Landlord may (A) exercise the remedy set forth in

                                      -34-
<PAGE>

and collect the damages permitted by Paragraph 23(a)(iii) or (B) collect the
damages set forth in Paragraph 23(b)(i) or 23(b)(ii).

           (ii) After repossession of the Leased Premises pursuant to clause (i)
above, Landlord shall have the right to relet any of the Leased Premises to such
tenant or tenants, for such term or terms, for such rent, on such conditions and
for such uses as Landlord in its sole discretion may determine, and collect and
receive any rents payable by reason of such reletting. Landlord may make such
Alterations in connection with such reletting as it may deem advisable in its
sole discretion. Notwithstanding any such reletting, Landlord may collect the
damages set forth in Paragraph 23(b)(ii).

           (iii) Landlord may, upon notice to Tenant, require Tenant to make an
irrevocable offer to terminate this Lease upon payment to Landlord of an amount
(the "Default Termination Amount") specified in the next sentence. The "Default
Termination Amount" shall be the greatest of (A) the sum of the Fair Market
Value of the Leased Premises and the applicable Prepayment Premium which
Landlord will be required to pay in prepaying any Loan with proceeds of the
Default Termination Amount, (B) the sum of the Acquisition Cost and the
applicable Prepayment Premium which Landlord will be required to pay in
prepaying any Loan with proceeds of the Default Termination Amount or (C) an
amount equal to the Present Value of the entire Basic Rent from the date of such
purchase to the date on which the Term would expire. Upon such notice to Tenant,
Tenant shall be deemed to have made such offer and shall, if requested by
Landlord, within ten (10) days following such request, deposit with Landlord as
payment against the Default Termination Amount the amount described in (B) above
and Landlord and Tenant shall promptly commence to determine Fair Market Value.
Upon such deposit by Tenant, Landlord shall automatically be deemed to have
accepted such offer. On the tenth (10th) business day after such acceptance,
Tenant shall pay to Landlord the Default Termination Amount and, at the request
of Tenant, Landlord will convey the Leased Premises to Tenant or its designee in
accordance with Paragraph 20. The remedy provided by this Paragraph 23(a)(iii)
shall not be available to Landlord if all sums claimed by Landlord under
Paragraph 23(a)(iv) below have been collected by Landlord from or on behalf of
Tenant.

           (iv) Landlord may declare by notice to Tenant the entire Basic Rent
(in the amount of Basic Rent then in effect) for the remainder of the then
current Term to be immediately due and payable. Tenant shall immediately pay to
Landlord all such Basic Rent discounted to its Present Value, all accrued Rent
then due and unpaid, all other Monetary Obligations which are then due and
unpaid and all Monetary Obligations which arise or become due by reason of such
Event of Default (including any Costs of Landlord). Upon receipt by Landlord of
all such accelerated Basic Rent and Monetary Obligations, this Lease shall
remain in full force and effect and Tenant shall have the right to possession of
the Leased Premises from the date of such receipt by Landlord to the end of the
Term, and subject to all the provisions of this Lease, including the obligation
to pay all increases in Basic Rent and all Monetary Obligations that
subsequently become due, except that (A) no Basic Rent which has been prepaid
hereunder shall be due thereafter during the said Term, (B) Tenant shall have no
option to extend or renew the Term, [and (C) Tenant shall have no further rights
under Paragraph 35. The remedy provided by this Paragraph 23(a)(iv) shall not be
available to Landlord if all sums claimed by Landlord under Paragraph 23(a)(iii)
above have been collected by Landlord from or on behalf of Tenant.

                                      -35-
<PAGE>

     (b) The following constitute damages to which Landlord shall be entitled if
Landlord exercises its remedies under Paragraph 23(a)(i) or 23(a)(ii) (but not
if a Landlord has collected all sums claimed by Landlord under Paragraph
23(a)(iii) or 23(a)(iv) above):

           (i) If Landlord exercises its remedy under Paragraph 23(a)(i) but not
its remedy under Paragraph 23(a)(ii) (or attempts to exercise such remedy and is
unsuccessful in reletting the Leased Premises) then, upon written demand from
Landlord, Tenant shall pay to Landlord, as liquidated and agreed final damages
for Tenant's default and in lieu of all current damages beyond the date of such
demand (it being agreed that it would be impracticable or extremely difficult to
fix the actual damages), an amount equal to the Present Value of the excess, if
any, of (A) all Basic Rent from the date of such demand to the date on which the
Term is scheduled to expire hereunder in the absence of any earlier termination,
re-entry or repossession over (B) the then fair market rental value of the
Leased Premises for the same period. Tenant shall also pay to Landlord all of
Landlord's Costs in connection with the repossession of the Leased Premises and
any attempted reletting thereof, including all brokerage commissions, legal
expenses attorneys' fees, employees' expenses, costs of Alterations and expenses
and preparation for reletting.

           (ii) If Landlord exercises its remedies under Paragraph 23(a)(i) and
23(a)(ii), then Tenant shall, until the end of what would have been the Term in
the absence of the termination of the Lease, and whether or not any of the
Leased Premises shall have been relet, be liable to Landlord for, and shall pay
to Landlord, as liquidated and agreed current damages all Monetary Obligations
which would be payable under this Lease by Tenant in the absence of such
termination less the net proceeds, if any, of any reletting pursuant to
Paragraph 23(a)(ii), after deducting from such proceeds all of Landlord's Costs
(including the items listed in the last sentence of Paragraph 23(b)(i) hereof)
incurred in connection with such repossessing and reletting; provided, that if
Landlord has not relet the Leased Premises, such Costs of Landlord shall be
considered to be Monetary Obligations payable by Tenant. Tenant shall be and
remain liable for all sums aforesaid, and Landlord may recover such damages from
Tenant and institute and maintain successive actions or legal proceedings
against Tenant for the recovery of such damages. Nothing herein contained shall
be deemed to require Landlord to wait to begin such action or other legal
proceedings until the date when the Term would have expired by its own terms had
there been no such Event of Default.

     (c) Notwithstanding anything to the contrary herein contained, in lieu of
or in addition to any of the foregoing remedies and damages, Landlord may
exercise any remedies and collect any damages available to it at law or in
equity. If Landlord is unable to obtain full satisfaction pursuant to the
exercise of any remedy, it may pursue any other remedy which it has hereunder or
at law or in equity.

     (d) Landlord shall not be required to mitigate any of its damages hereunder
unless required to by applicable Law. If any Law shall validly limit the amount
of any damages provided for herein to an amount which is less than the amount
agreed to herein, Landlord shall be entitled to the maximum amount available
under such Law.

                                      -36-
<PAGE>

     (e) No termination of this Lease, repossession or reletting of the Leased
Premises, exercise of any remedy or collection of any damages pursuant to this
Paragraph 23 shall relieve Tenant of any Surviving Obligations.

     (f) WITH RESPECT TO ANY REMEDY OR PROCEEDING OF LANDLORD OR TENANT
HEREUNDER, LANDLORD AND TENANT HEREBY WAIVE ANY RIGHT TO A TRIAL BY JURY.

     (g) Upon the occurrence and during the continuance of any Event of Default,
Landlord shall have the right (but no obligation) to perform any act required of
Tenant hereunder and, if performance of such act requires that Landlord enter
the Leased Premises, Landlord may enter the Leased Premises for such purpose.

     (h) No failure of Landlord (i) to insist at any time upon the strict
performance of any provision of this Lease or (ii) to exercise any option,
right, power or remedy contained in this Lease shall be construed as a waiver,
modification or relinquishment thereof. A receipt by Landlord of any sum in
satisfaction of any Monetary Obligation with knowledge of the breach of any
provision hereof shall not be deemed a waiver of such breach, and no waiver by
Landlord of any provision hereof shall be deemed to have been made unless
expressed in a writing signed by Landlord.

     (i) Tenant hereby waives and surrenders, for itself and all those claiming
under it, including creditors of all kinds, (i) any right and privilege which it
or any of them may have under any present or future Law to redeem any of the
Leased Premises or to have a continuance of this Lease after termination of this
Lease or of Tenant's right of occupancy or possession pursuant to any court
order or any provision hereof, and (ii) the benefits of any present or future
Law which exempts property from liability for debt or for distress for rent.

     (j) Except as otherwise provided herein, all remedies are cumulative and
concurrent and no remedy is exclusive of any other remedy. Each remedy may be
exercised at any time an Event of Default has occurred and is continuing and may
be exercised from time to time. No remedy shall be exhausted by any exercise
thereof.

24.        NOTICES. All notices, demands, requests, consents, approvals, offers,
statements and other instruments or communications required or permitted to be
given pursuant to the provisions of this Lease shall be in writing and shall be
deemed to have been given and received for all purposes when delivered in person
or by Federal Express or other reliable 24-hour delivery service or five (5)
business days after being deposited in the United States mail, by registered or
certified mail, return receipt requested, postage prepaid, addressed to the
other party at its address stated on page one of this Lease or when delivery is
refused. Notices sent to Landlord shall be to the attention of Director, Asset
Management, and notices to Tenant shall be to the attention of Robert D. Iseman.
A copy of any notice given by Tenant to Landlord shall simultaneously be given
by Tenant to Reed Smith LLP, 2500 One Liberty Place, Philadelphia, PA 19103,
Attention: Chairman, Real Estate Department, and a copy of any notice given by
Landlord to Tenant shall simultaneously be given by Landlord to Wolff & Samson,
5 Becker Farm Road, Roseland, New Jersey 07068, Attention: Daniel A. Schwartz,
Esq. For the purposes of this Paragraph, any party may substitute another
address stated above (or substituted by a

                                      -37-
<PAGE>

previous notice) for its address by giving fifteen (15) days' notice of the new
address to the other party, in the manner provided above. Notice of address
change shall be effective only upon receipt.

25.        ESTOPPEL CERTIFICATE. At any time upon not less than ten (10) days'
prior written request by either Landlord or Tenant (the "REQUESTING PARTY") to
the other party (the "RESPONDING PARTY"), but not more often than once each
calendar quarter, the Responding Party shall deliver to the Requesting Party a
statement in writing, executed by an authorized officer of the Responding Party,
certifying (a) that, except as otherwise specified, this Lease is unmodified and
in full force and effect, (b) the dates to which Basic Rent, Additional Rent and
all other Monetary Obligations have been paid, (c) that, to the knowledge of the
signer of such certificate and except as otherwise specified, no Event of
Default exists hereunder, (d) such other matters as the Requesting Party may
reasonably request, and (e) if Tenant is the Responding Party that, except as
otherwise specified, there are no proceedings pending or, to the knowledge of
the signer, threatened, against Tenant before or by any court or administrative
agency which, if adversely decided, would materially and adversely affect the
financial condition and operations of Tenant. Any such statements by the
Responding Party may be relied upon by the Requesting Party, any Person whom the
Requesting Party notifies the Responding Party in its request for the
Certificate is an intended recipient or beneficiary of the Certificate, any
Lender or their assignees and by any prospective purchaser or mortgagee of any
of the Leased Premises. Any certificate required under this Paragraph 25 and
delivered by Tenant shall state that, in the opinion of each person signing the
same, he has made such examination or investigation as is necessary to enable
him to express an informed opinion as to the subject matter of such certificate,
and shall briefly state the nature of such examination or investigation.

26.        SURRENDER. Upon the expiration or earlier termination of this Lease,
Tenant shall peaceably leave and surrender the Leased Premises to Landlord in
the same condition in which the Leased Premises was at the commencement of this
Lease, except as repaired, rebuilt, restored, altered, replaced or added to as
permitted or required by any provision of this Lease, and except for ordinary
wear and tear. Upon such surrender, Tenant shall (a) remove from the Leased
Premises all property which is owned by Tenant or third parties other than
Landlord and (b) repair any damage caused by such removal. Property not so
removed shall become the property of Landlord, and Landlord may thereafter cause
such property to be removed from the Leased Premises. The cost of removing and
disposing of such property and repairing any damage to any of the Leased
Premises caused by such removal shall be paid by Tenant to Landlord upon demand.
Landlord shall not in any manner or to any extent be obligated to reimburse
Tenant for any such property which becomes the property of Landlord pursuant to
this Paragraph 26.

27.        NO MERGER OF TITLE. There shall be no merger of the leasehold estate
created by this Lease with the fee estate in any of the Leased Premises by
reason of the fact that the same Person may acquire or hold or own, directly or
indirectly, (a) the leasehold estate created hereby or any part thereof or
interest therein and (b) the fee estate in any of the Leased Premises or any
part thereof or interest therein, unless and until all Persons having any
interest in the interests described in (a) and (b) above which are sought to be
merged shall join in a written instrument effecting such merger and shall duly
record the same.

                                      -38-
<PAGE>

28.        BOOKS AND RECORDS.

     (a) Tenant shall keep adequate records and books of account with respect to
the finances and business of Tenant generally and with respect to the Leased
Premises, in accordance with generally accepted accounting principles ("GAAP")
consistently applied, and shall permit Landlord and Lender by their respective
agents, accountants and attorneys, upon reasonable prior notice to Tenant, to
visit and inspect the Leased Premises and examine (and make copies of) the
records and books of account and to discuss the finances and business with the
officers of Tenant, at such reasonable times as may be requested by Landlord.
Upon the request of Lender or Landlord (either telephonically or in writing),
Tenant shall provide the requesting party with copies of any information to
which such party would be entitled in the course of a personal visit.

     (b) If, at any time during the Term, Tenant is not a direct or indirect
fully-owned subsidiary of Foster Wheeler Ltd., Tenant shall deliver to Landlord
and to Lender within ninety (90) days of the close of each fiscal year, annual
audited financial statements of Tenant prepared by a nationally recognized firm
of independent certified public accountants. Tenant shall also furnish to
Landlord within forty-five (45) days after the end of each of the three
remaining quarters unaudited financial statements and all other quarterly
reports of Tenant, certified by Tenant's chief financial officer, and all
filings, if any, of Form 10-K, Form 10-Q and other required filings with the
Securities and Exchange Commission by Tenant or any Guarantor pursuant to the
provisions of the Securities Exchange Act of 1934, as amended, or any other Law.
All financial statements shall be prepared in accordance with GAAP consistently
applied. All annual financial statements shall be accompanied (i) by an opinion
of said accountants stating that (A) there are no qualifications as to the scope
of the audit and (B) the audit was performed in accordance with GAAP and (h) by
the affidavit of the president or a vice president of Tenant, dated within five
(5) days of the delivery of such statement, stating that (C) the affiant knows
of no Event of Default, or event which, upon notice or the passage of time or
both, would become an Event of Default which has occurred and is continuing
hereunder or, if any such event has occurred and is continuing, specifying the
nature and period of existence thereof and what action Tenant has taken or
proposes to take with respect thereto and (D) except as otherwise specified in
such affidavit, that Tenant has fulfilled all of its obligations under this
Lease which are required to be fulfilled on or prior to the date of such
affidavit.

     (c) All quarterly and annual financial statements shall be accompanied by a
certification ("COVENANT CERTIFICATION") of the chief financial officer of
Foster Wheeler Ltd. that Tenant and Guarantors, taken as a whole, are in
compliance with the Covenants (except as otherwise specified in the Covenant
Certification), together with a calculation of the Covenants described in
Section 6.01 of Article VI of the Credit Agreement (or comparable Covenants in a
Senior Credit Agreement).

29.        DETERMINATION OF VALUE.

     (a) Whenever a determination of Fair Market Value is required pursuant to
any provision of this Lease, such Fair Market Value shall be determined in
accordance with the following procedure:

                                      -39-
<PAGE>

           (i) Landlord and Tenant shall endeavor to agree upon such Fair Market
Value within thirty (30) days after the date (the "APPLICABLE INITIAL DATE") on
which (A) Tenant provides Landlord with notice of its intention to terminate
this Lease and purchase the Leased Premises pursuant to Paragraph 18, (B)
Landlord provides Tenant with notice of its intention to redetermine Fair Market
Value pursuant to Paragraph 20(c), (C) Landlord provides Tenant with notice of
Landlord's intention to require Tenant to make an offer to terminate this Lease
pursuant to Paragraph 23(a)(iii) or (D) Landlord receives an Option Exercise
Notice. Upon reaching such agreement, the parties shall execute an agreement
setting forth the amount of such Fair Market Value.

           (ii) If the parties shall not have signed such agreement within
thirty (30) days after the Applicable Initial Date, Tenant shall within fifty
(50) days after the Applicable Initial Date select an appraiser and notify
Landlord in writing of the name, address and qualifications of such appraiser.
Within twenty (20) days following Landlord's receipt of Tenant's notice of the
appraiser selected by Tenant, Landlord shall select an appraiser and notify
Tenant of the name, address and qualifications of such appraiser. Such two
appraisers shall endeavor to agree upon Fair Market Value based on a written
appraisal made by each of them (and given to Landlord by Tenant) as of the
Relevant Date. If such two appraisers shall agree upon a Fair Market Value, the
amount of such Fair Market Value as so agreed shall be binding and conclusive
upon Landlord and Tenant.

           (iii) If such two appraisers shall be unable to agree upon a Fair
Market Value within twenty (20) days after the selection of an appraiser by
Landlord, then such appraisers shall advise Landlord and Tenant of their
respective determination of Fair Market Value and shall select a third appraiser
to make the determination of Fair Market Value. The selection of the third
appraiser shall be binding and conclusive upon Landlord and Tenant.

           (iv) If such two appraisers shall be unable to agree upon the
designation of a third appraiser within ten (10) days after the expiration of
the twenty (20) day period referred to in clause (iii) above, or if such third
appraiser does not make a determination of Fair Market Value within twenty (20)
days after his selection, then such third appraiser or a substituted third
appraiser, as applicable, shall, at the request of either party hereto, be
appointed by the President or Chairman of the American Arbitration Association
in New York, New York. The determination of Fair Market Value made by the third
appraiser appointed pursuant hereto shall be made within twenty (20) days after
such appointment.

           (v) If a third appraiser is selected, Fair Market Value shall be the
average of the determination of Fair Market Value made by the third appraiser
and the determination of Fair Market Value made by the appraiser (selected
pursuant to Paragraph 29(a)(ii) hereof) whose determination of Fair Market Value
is nearest to that of the third appraiser. Such average shall be binding and
conclusive upon Landlord and Tenant.

           (vi) All appraisers selected or appointed pursuant to this Paragraph
29(a) shall (A) be independent qualified MAI appraisers having no less than ten
(10) years experience involving properties similar to the Leased Premises, (B)
have no right, power or authority to alter or modify the provisions of this
Lease, (C) utilize the definition of Fair Market Value hereinabove set forth
above, and (D) be registered in the State if the State provides for or requires

                                      -40-
<PAGE>

such registration. The Cost of the procedure described in this Paragraph 29(a)
above shall be borne by Tenant.

     (b) If, by virtue of any delay, Fair Market Value is not determined by the
expiration or termination of the then current Term, then the date on which the
Term would otherwise expire or terminate shall be extended to the date specified
for termination in the particular provision of this Lease pursuant to which the
determination of Fair Market Value is being made.

     (c) In determining Fair Market Value as defined in clause (b) of the
definition of Fair Market Value, the appraisers shall add (i) the present value
of the Rent for the remaining Term using a discount rate (which may be
determined by an investment banker retained by each appraiser) based on the
creditworthiness of Tenant and Guarantor and (ii) the present value of the
Leased Premises as of the end of such Term. The appraisers shall further assume
that no default then exists under the Lease, that Tenant has complied (and will
comply) with all provisions of the Lease, and that no Event of Default exists
under the Guaranty.

30.        NON-RECOURSE AS TO LANDLORD. Anything contained herein to the
contrary notwithstanding, any claim based on or in respect of any liability of
Landlord under this Lease shall be limited to actual damages and shall be
enforced only against the Leased Premises and not against any other assets,
properties or funds of (i) Landlord, (ii) any director, officer, member, general
partner, shareholder, limited partner, beneficiary, employee or agent of
Landlord or any general partner of Landlord or any of its members or general
partners (or any legal representative, heir, estate, successor or assign of any
thereof), (iii) any predecessor or successor partnership or corporation (or
other entity) of Landlord or any of its general partners, shareholders,
officers, directors, members, employees or agents, either directly or through
Landlord or its general partners, shareholders, officers, directors, employees
or agents or any predecessor or successor partnership or corporation (or other
entity), or (iv) any Person affiliated with any of the foregoing, or any
director, officer, employee or agent of any thereof.

31.        FINANCING.

     (a) Tenant agrees to pay all costs and expenses incurred by Landlord in
connection with the purchase, leasing and initial financing of the Leased
Premises including, without limitation, the cost of appraisals, environmental
reports, title insurance, surveys, legal fees and expenses and Lender's
commitment fees.

     (b) Tenant agrees to pay, within three (3) business days of written demand
therefor, any cost, charge or expense (other than the principal of the Note and
interest thereon at the contract rate of interest specified therein) imposed
upon Landlord by Lender pursuant to the Note, the Mortgage or the Assignment
which is not caused solely by the gross negligence or willful misconduct of
Landlord and which is not otherwise reimbursed by Tenant to Landlord pursuant to
any other provision of this Lease.

     (c) If Landlord desires to obtain or refinance any Loan, Tenant shall
negotiate in good faith with Landlord concerning any request made by any Lender
or proposed Lender for changes or modifications in this Lease. In particular,
Tenant shall agree, upon request

                                      -41-
<PAGE>

of Landlord, to supply any such Lender with such notices and information as
Tenant is required to give to Landlord hereunder and to extend the rights of
Landlord hereunder to any such Lender and to consent to such financing if such
consent is requested by such Lender. Tenant shall provide any other consent or
statement and shall execute any and all other documents that such Lender
reasonably requires in connection with such financing, including any
environmental indemnity agreement, so long as the same do not materially
adversely affect any right, benefit or privilege of Tenant under this Lease or
materially increase Tenant's obligations under this Lease and a subordination,
non-disturbance and attornment agreement substantially in the form executed by
Tenant for the benefit of Morgan Stanley Bank on or about the date hereof (the
"SNDA").

32.        SUBORDINATION, NON-DISTURBANCE AND ATTORNMENT. This Lease and
Tenant's interest hereunder shall be subordinate to any Mortgage or other
security instrument hereafter placed upon the Leased Premises by Landlord, and
to any and all advances made or to be made thereunder, to the interest thereon,
and all renewals, replacements and extensions thereof, provided that Lender has
entered into the SNDA.

33.        TAX TREATMENT; REPORTING. Landlord and Tenant each acknowledge that
each shall treat this transaction as a true lease for state law purposes and
shall report this transaction as a Lease for Federal income tax purposes. For
Federal income tax purposes each shall report this Lease as a true lease with
Landlord as the owner of the Leased Premises and Equipment and Tenant as the
lessee of such Leased Premises and Equipment including: (1) treating Landlord as
the owner of the property eligible to claim depreciation deductions under
Section 167 or 168 of the Internal Revenue Code of 1986 (the "Code") with
respect to the Leased Premises and Equipment, (2) Tenant reporting its Rent
payments as rent expense under Section 162 of the Code, and (3) Landlord
reporting the Rent payments as rental income.

34.        OPERATING COVENANTS.  Tenant hereby covenants and agrees to comply
with all the covenants and agreements described in Exhibit "E" hereto.

35.        OPTION TO PURCHASE.

     (a) Landlord does hereby give and grant to Tenant the option to purchase
the Leased Premises (i) for a purchase price (the "PURCHASE PRICE") equal to the
Offer Amount and (ii) on any date (the "OPTION PURCHASE DATE") during the last
thirty (30) days of the tenth (10th) Lease Year (i.e., between August 1, 2012
and August 31, 2012) of the date of this Lease which is mutually agreeable to
Landlord and Tenant, but in any event not sooner than thirty (30) days after the
Fair Market Value Date. If Tenant intends to exercise such option, Tenant shall
give written notice to Landlord to such effect ("OPTION EXERCISE NOTICE") not
later than August 1, 2011 which notice once given shall be irrevocable. Promptly
upon receipt of such notice by Landlord, the parties shall commence to determine
Fair Market Value.

     (b) If Tenant shall exercise the foregoing option to purchase the Leased
Premises, on the later to occur of (i) the Option Purchase Date or (ii) the date
when Tenant has paid the Offer Amount and has satisfied all other Monetary
Obligations, Landlord shall convey the Leased Premises to Tenant in accordance
with Paragraph 20 hereof; provided, that if an Event of Default under Paragraph
22(a)(i) has occurred and is continuing on the Option

                                      -42-
<PAGE>

Purchase Date, Landlord, at its sole option, may terminate Tenant's option to
purchase hereunder. IF THIS LEASE SHALL TERMINATE FOR ANY REASON PRIOR TO THE
DATE ORIGINALLY FIXED HEREIN FOR THE EXPIRATION OF THE TERM, OR IF TENANT SHALL
FAIL TO GIVE THE AFORESAID NOTICE OF INTENTION TO PURCHASE, TIME BEING OF THE
ESSENCE, THE OPTION PROVIDED IN THIS PARAGRAPH 35 AND ANY EXERCISE THEREOF BY
TENANT SHALL CEASE AND TERMINATE AND SHALL BE NULL AND VOID. IN SUCH EVENT
TENANT SHALL EXECUTE A QUITCLAIM DEED AND SUCH OTHER DOCUMENTS AS LANDLORD SHALL
REASONABLY REQUEST EVIDENCING THE TERMINATION OF ITS OPTIONS.

36.        SECURITY DEPOSIT.

     (a) Concurrently with the execution of this Lease, Tenant shall deliver to
Landlord within ten (10) days following receipt of Landlord's written request a
security deposit (the "Security Deposit") in the amount of Ten Million Four
Hundred Sixty-One Thousand Seven Hundred and no/100 Dollars ($10,461,700.00).
The Security Deposit shall, at Tenant's option, be in the form of (i) cash (the
"Cash Security Deposit") or (ii) an irrevocable Letter of Credit (the "Letter of
Credit") issued by a bank reasonably acceptable to Landlord and in form and
substance reasonably satisfactory to Landlord. Provided no Event of Default then
exists, Tenant shall have the right, at any time at its option, to substitute a
Cash Security Deposit for the Letter of Credit or to substitute a Letter of
Credit for the Cash Security Deposit. The Security Deposit shall serve as
security for the payment by Tenant of the Rent and all other charges or payments
to be paid hereunder and the performance of the covenants and obligations
contained herein.

If the Security Deposit is in the form of the Cash Security Deposit, the Cash
Security Deposit shall be deposited in an interest bearing money market account
with a national financial institution of Landlord's choosing and, so long as no
Event of Default shall have occurred and be continuing, upon the annual written
request of Tenant all accrued interest thereon shall be disbursed to Tenant on
an annual basis commencing on or about the first anniversary of the date of the
establishment of such account. So long as no Event of Default shall have
occurred and be continuing, the Cash Security Deposit shall not be commingled
with other funds of Landlord. If the Security Deposit is in the form of the
Letter of Credit, the Letter of Credit shall remain in full force and effect
during the Term, and shall be renewed at least thirty (30) days prior to any
expiration thereof. If Tenant fails to renew the Letter of Credit by such date,
time being of the essence, Landlord shall have the right at any time after the
thirtieth (30th) day before such expiration date to draw on the Letter of Credit
and to deposit the proceeds of the Letter of Credit in any account for the
benefit of Landlord or to declare an Event of Default. The proceeds of any draw
on the Letter of Credit shall be and constitute the Cash Security Deposit
hereunder, and shall be held as such by the Landlord.

     (b) Notwithstanding anything to the contrary set forth herein, so long as
no Event of Default has occurred and is then continuing, the Security Deposit
shall be increased or reduced from time to time to reflect the credit rating on
the senior unsecured debt of either Tenant or any Guarantor as follows:

                                      -43-
<PAGE>

<TABLE>
<CAPTION>

                     RATING                                      AMOUNT OF SECURITY DEPOSIT
                     ------                                      --------------------------
<S>   <C>                                                          <C>
(i)    less than BB+ from S&P or less than Ba1 from Moody's       24 months of Basic Rent
(ii)   BB+ from S&P or Ba1 from Moody's                           18 months of Basic Rent
(iii)  Between BBB+ and BBB- from S&P or between Baa1             12 months of Basic Rent
           and Baa3 from Moody's
(iv)   At least A- from S&P or at least A3 from Moody's            6 months of Basic Rent
</TABLE>

           If there is a split credit rating, the lower rating shall apply. At
no time shall the Security Deposit be less than an amount equal to six (6)
months Basic Rent. The principal amount of the Security Deposit required to be
maintained by Tenant at anytime under the terms of this Paragraph 36 is
hereinafter referred to as the "Required Amount".

           Notwithstanding the foregoing, if the Security Deposit is in the form
of the Letter of Credit, Landlord shall be under no obligation to release such
Letter of Credit as otherwise required by the Paragraph 35(b) unless and until a
substitute letter of credit in the amount of the Required Amount and in form and
substance required by this Paragraph 35 is delivered to Landlord.

     (c) If at any time an Event of Default shall have occurred and be
continuing, Landlord shall be entitled, at its sole discretion, to draw on the
Letter of Credit or to withdraw the Cash Security Deposit from the
above-described account(s) and to apply the proceeds in payment of (i) any Rent
or other charges for the payment of which Tenant shall be in default, (ii)
prepaid Basic Rent, (iii) any expense incurred by Landlord in curing any Event
of Default of Tenant, and/or (iv) any other sums due to Landlord in connection
with any Event of Default or the curing thereof, including, without limitation,
any damages incurred by Landlord by reason of such Event of Default, including
any rights of Landlord under Paragraph 23 or to do any combination of the
foregoing, all in such order or priority as Landlord shall so determine in its
sole discretion and Tenant acknowledges and agrees that such proceeds shall not
constitute assets or funds of Tenant or its estate, or be deemed to be held in
trust for Tenant, but shall be, for all purposes, the property of Landlord (or
Lender, to the extent assigned). Tenant further acknowledges and agrees that (1)
Landlord's application of the proceeds of the Security Deposit towards the
payment of Basic Rent, Additional Rent or the reduction of any damages due
Landlord in accordance with Paragraph 23 of this Lease, constitutes a fair and
reasonable use of such proceeds, and (2) the application of such proceeds by
Landlord towards the payment of Basic Rent, Additional Rent or any other sums
due under this Lease shall not constitute a cure by Tenant of the applicable
Event of Default provided that an Event of Default shall not exist if Tenant
restores the Security Deposit to its original amount within five (5) days after
notice from Landlord and in accordance with the requirements of this Paragraph
36, so that the Required Amount of the Security Deposit shall be again on
deposit with Landlord.

     (d) At the expiration of the Term and so long as no Event of Default exists
the Letter of Credit or the Cash Security Deposit, as the case may be, shall be
returned to Tenant, and Landlord shall execute any documents required in order
to release the Letter of Credit or Cash Security Deposit to Tenant.

     (e) Landlord shall have the right to designate Lender or any other holder
of a Mortgage as the beneficiary of the Letter of Credit or the Cash Security
Deposit during the term of the applicable Loan, and such Lender or other holder
of a Mortgage shall have

                                      -44-
<PAGE>

all of the rights of Landlord under this Paragraph 36. Tenant covenants and
agrees to execute such agreements, consents and acknowledgments as may be
reasonably requested by Landlord from time to time to change the holder of the
Security Deposit as hereinabove provided.

37.        PERMITTED LEASEHOLD MORTGAGE. Tenant shall not encumber its leasehold
estate in the Leased Premises, by means of a leasehold mortgage, deed of trust
pledge or similar security device, except by means of a Permitted Leasehold
Mortgage. The Leased Premises shall not be encumbered by more than one Permitted
Leasehold Mortgage at any one time. Tenant shall deliver to Landlord an executed
counterpart of any Permitted Leasehold Mortgage within ten (10) days after its
execution thereof, together with confirmation from the Permitted Leasehold
Mortgagee that it or they are Tenant's senior lenders or agent therefor.

38.        RIGHTS OF PERMITTED LEASEHOLD MORTGAGEES. Landlord hereby agrees
that, so long as any Permitted Leasehold Mortgage shall remain unsatisfied of
record, the following provisions shall apply:

     (a) Landlord, upon giving Tenant any notice of an Event of Default
hereunder, shall also give such notice to any Permitted Leasehold Mortgagee of
which it has actual notice.

     (b) Upon the occurrence of an Event of Default hereunder, the Permitted
Leasehold Mortgagee shall, within thirty (30) days after the period provided for
in Paragraph 22 hereof, have the right to remedy such default, or cause the same
to be remedied, and Landlord shall accept such performance by or at the instance
of the Permitted Leasehold Mortgagee as if the same had been made by Tenant.

     (c) Upon the occurrence of an Event of Default hereunder, Landlord shall
not terminate this Lease without first giving the Permitted Leasehold Mortgagee
sixty (60) days after notice thereof within which either (i) to obtain
possession of the Leased Premises (including possession by a receiver) or (ii)
to institute foreclosure proceedings or (iii) otherwise act to acquire Tenant's
interest under this Lease with diligence. The preceding sentence shall not
apply, and Landlord may take terminate this Lease if:

           (i) an Event of Default shall have occurred that is then susceptible
of being cured by the Permitted Leasehold Mortgagee without obtaining possession
of the Leased Premises and the Permitted Leasehold Mortgagee (A) shall not have
cured any Event of Default consisting of a failure to pay Basic Rent or
Additional Rent within five (5) days after receipt of written notice from
Landlord of such Event of Default, or (B) shall not, within thirty (30) days
after the applicable cure period specified in Paragraph 22(b), have cured any
Event of Default other than a failure to pay Basic Rent or Additional Rent;

           (ii) an Event of Default (other than any Event of Default described
in subparagraph 38(c)(i)(A) above) shall have occurred and either (A) the
Permitted Leasehold Mortgagee, within twenty (20) days after the receipt from
Landlord of written notice of such Event of Default, shall not have given
written notice to Landlord that such Event of Default cannot be remedied without
obtaining possession of the Leased Premises; or (B) the Permitted Leasehold
Mortgagee shall not have paid or caused to be paid all Rent and other sums

                                      -45-
<PAGE>

payable under this Lease within the time periods required hereby; or (C) the
Permitted Leasehold Mortgagee shall, within twenty (20) days after receipt of
written notice from Landlord of such Event of Default, fail to give Landlord
reasonable written assurance that it shall, after obtaining possession, and
within thirty (30) days after the applicable cure period provided in Paragraph
22(b), cure any such Event of Default which is susceptible of cure only upon
taking possession; (D) the Permitted Leasehold Mortgagee shall fail to pursue
with diligence the activities specified in (i), (ii), or (iii) of the first
sentence of this Paragraph 38(c); or (5) the Permitted Leasehold Mortgagee
within thirty (30) days after the giving by Landlord of receipt of written
notice from Landlord of such Event of Default shall not have given written
notice to Landlord that such Event of Default is not reasonably susceptible of
being cured by the Permitted Leasehold Mortgagee.

           (d) It is expressly understood, without limiting the generality of
the foregoing language, that any failure of Tenant to perform any of its
obligations under Paragraphs 18 or 29 is susceptible of cure by the Permitted
Leasehold Mortgagee without taking possession, and Tenant hereby authorizes the
Permitted Leasehold Mortgagee, on behalf of Tenant, to send any notice, make any
offer, pay any amount, select an appraiser, and perform any other obligation of
Tenant provided in said paragraphs.

           (e) In addition to curing any Event of Default which is susceptible
of being cured without taking possession, the Permitted Leasehold Mortgagee
shall, during the period it is taking the action in clauses (i), (ii) or (iii)
of the first sentence of Paragraph 38(c)(i) above, pay Basic Rent and Additional
Rent as the same shall become due and payable and, upon obtaining possession or
acquiring Tenant's interest under this Lease, shall be required to commence to
cure within thirty (30) days of such acquisition or possession all Events of
Default then outstanding and reasonably susceptible of being cured by the
Permitted Leasehold Mortgage, and thereafter diligently prosecute such cure to
completion; provided, that: (i) the Permitted Leasehold Mortgagee shall not be
obligated to continue such possession or to continue such foreclosure
proceedings after such Events of Default shall have been cured; and (ii) the
Permitted Leasehold Mortgagee shall agree with Landlord in writing to comply
during the period of such forbearance with such of the terms, conditions and
covenants of this Lease as are reasonably susceptible of being complied with by
the Permitted Leasehold Mortgagee.

           (f) It is understood and agreed that the Permitted Leasehold
Mortgagee or its designees or any purchaser in foreclosure proceedings
(including a corporation formed by any Permitted Leasehold Mortgagee or the
holder or holders of the obligations secured by the Permitted Leasehold
Mortgage) may become the legal owner and holder of this Lease through such
foreclosure proceedings or by assignment of this Lease in lieu of foreclosure
provided, however, that in such event the Permitted Leasehold Mortgagee shall
assure (in form and substance satisfactory to Landlord) all of the obligations
and liabilities of Tenant hereunder (except those which are personal to Tenant),
except that the Permitted Leasehold Mortgagee shall be released from liability
under this Lease if the substitute tenant is approved by Landlord in its
reasonable discretion.

           (g) If a termination of this Lease occurs prior to the expiration of
the Term by reason of the rejection of this Lease or other action by a trustee,
court or debtor in possession pursuant to the Federal Bankruptcy Code, as
amended, or any other Federal, state or

                                      -46-
<PAGE>

local insolvency laws, Landlord shall give the Permitted Leasehold Mortgagee
written notice that this Lease has been terminated, together with a statement of
any and all sums which would at that time be due under this Lease but for such
termination, and of all other Events of Default, if any, under this Lease then
known to Landlord. The Permitted Leasehold Mortgagee shall thereupon have the
option to obtain a new lease in accordance with and upon the following terms and
conditions: (i) such new lease shall be effective as of the date of termination
of this Lease and shall be for the remainder of the full original term and at
the rent and upon all the agreements, terms, covenants and conditions hereof;
(ii) such new lease shall require the tenant to perform any unfulfilled
obligations of Tenant under this Lease which are reasonably susceptible of being
performed by such tenant; (iii) if the Permitted Leasehold Mortgagee designates
an entity to enter into such new lease, the Permitted Leasehold Mortgagee shall
guaranty all of the obligations and liabilities of such designee hereunder
(except those which are personal to such designee, E.G., the obligations of such
designee to permit Landlord to inspect its books and records or to supply
financial statements to Landlord except that no such guaranty shall be required
if such designee is approved by Landlord in its reasonable discretion; (iv) upon
the execution of such new lease, the tenant named therein shall pay any and all
Rent which would at the time of the execution thereof be due under this Lease
but for such termination, less the net proceeds, if any, of any reletting or
other occupancy, after deducting from such proceeds all of Landlord's expenses
in connection with such reletting (including all reasonable repossession costs,
brokerage commissions, legal expenses, attorneys' fees, employees' expenses,
costs of alterations and expenses of preparation for reletting).

     (h) Any notice or other communication which Landlord shall desire or is
required to give to or serve upon any Permitted Leasehold Mortgagee shall be
addressed to such Permitted Leasehold Mortgagee by notice in writing given to
Landlord in accordance with Paragraph 24 hereof. Any notice or other
communication which any Permitted Leasehold Mortgagee shall desire or is
required to give to or serve upon Landlord shall be deemed to have been duly
given or served if sent in accordance with Paragraph 24 hereof.

     (i) The provisions of this Paragraph 38 shall be self-operative and shall
benefit any Permitted Leasehold Mortgagee of which Landlord has actual notice.
Notwithstanding the foregoing, Landlord shall, at the request of Tenant of the
Permitted Leasehold Mortgagee, and at the sole cost and expense of Tenant or the
Permitted Leasehold Mortgagee, enter into an agreement directly with the
Permitted Leasehold Mortgagee having terms and provisions identical to the
provisions of this Paragraph 38.

39.        POST-CLOSING OBLIGATIONS.

     a) On the date hereof, Tenant has deposited with Landlord the amount of
$131,250.00 (the "POST-CLOSING ESCROW") which shall secure the obligation of
Tenant to complete the roof repairs described in EXHIBIT "F" attached hereto
(the "ROOF REPAIRS"). The Post Closing Escrow shall be held and disbursed as set
forth in this Paragraph 39.

     b) Tenant covenants and agrees to complete the Roof Repairs by the dates
specified in EXHIBIT "F". The Post-Closing Escrow shall be released to Tenant
within thirty (30) days following the date on which Landlord receives (i) a
report from Professional Service Industries, Inc. ("PSI") that the Roof Repairs
have been completed, and (ii) evidence from Tenant of payment in full for the
Roof Repairs. Landlord will cause PSI to inspect the Roof

                                      -47-
<PAGE>

Repairs and to furnish a report to Landlord, at Tenant's sole cost and expense,
within thirty (30) days after request therefor by Tenant.

     c) If, at any time prior to the release of the Post-Closing Escrow, an
Event of Default shall have occurred and be continuing, Landlord shall use the
proceeds of the Post-Closing Escrow to the extent required to complete the Roof
Repairs, and be entitled, at its sole discretion, to apply any remaining balance
in payment of any Rent or other charges which have not been made pursuant to
this Lease and any other sums due to Landlord in connection with any default or
the curing thereof, including, without limitation, any damages incurred by
Landlord by reason of such default.

     d) Landlord shall have the right to designate Lender or any other holder of
a Mortgage as the holder of the Post-Closing Escrow during the term of the
applicable Loan who shall have all of the rights of Landlord under this
Paragraph 39. Tenant covenants and agrees to execute such agreements, consents
and acknowledgments as may be requested by Landlord from time to time to change
the holder of the Post-Closing Escrow as hereinabove provided.

40)        MISCELLANEOUS.

     a) The paragraph headings in this Lease are used only for convenience in
finding the subject matters and are not part of this Lease or to be used in
determining the intent of the parties or otherwise interpreting this Lease.

     b) As used in this Lease, the singular shall include the plural and any
gender shall include all genders as the context requires and the following words
and phrases shall have the following meanings: (i) "including" shall mean
"including without limitation"; (ii) "provisions" shall mean "provisions, terms,
agreements, covenants and/or conditions"; (iii) "lien" shall mean "lien, charge,
encumbrance, title retention agreement, pledge, security interest, mortgage
and/or deed of trust"; (iv) "obligation" shall mean "obligation, duty,
agreement, liability, covenant and/or condition"; (v) "any of the Leased
Premises" shall mean "the Leased Premises or any part thereof or interest
therein"; (vi) "any of the Land" shall mean "the Land or any part thereof or
interest therein"; (vii) "any of the Improvements" shall mean "the Improvements
or any part thereof or interest therein"; (viii) "any of the Equipment" shall
mean "the Equipment or any part thereof or interest therein"; and "any of the
Adjoining Property" shall mean "the Adjoining Property or any part thereof or
interest therein."

     c) Any act which Landlord is permitted to perform under this Lease may be
performed at any time and from time to time by Landlord or any person or entity
designated by Landlord. Landlord shall not unreasonably withhold or delay its
consent whenever such consent is required under this Lease, except as otherwise
specifically provided herein and except that with respect to any assignment of
this Lease or subletting of the Leased Premises not expressly permitted by the
terms of this Lease, Landlord may withhold its consent for any reason or no
reason. Time is of the essence with respect to the performance by Tenant of its
obligations under this Lease.

     d) Landlord shall in no event be construed for any purpose to be a partner,
joint venturer or associate of Tenant or of any subtenant, operator,
concessionaire or

                                      -48-
<PAGE>

licensee of Tenant with respect to any of the Leased Premises or otherwise in
the conduct of their respective businesses.

     e) This Lease and any documents which may be executed by Tenant in
connection therewith at Landlord's request constitute the entire agreement
between the parties and supersede all prior understandings and agreements,
whether written or oral, between the parties hereto relating to the Leased
Premises and the transactions provided for herein. Landlord and Tenant are
business entities having substantial experience with the subject matter of this
Lease and have each fully participated in the negotiation and drafting of this
Lease. Accordingly, this Lease shall be construed without regard to the rule
that ambiguities in a document are to be construed against the drafter.

     f) This Lease may be modified, amended, discharged or waived only by an
agreement in writing signed by the party against whom enforcement of any such
modification, amendment, discharge or waiver is sought.

     g) The covenants of this Lease shall run with the land and bind Tenant, its
successors and assigns and all present and subsequent encumbrancers and
subtenants of any of the Leased Premises, and shall inure to the benefit of
Landlord, its successors and assigns. If there is more than one Tenant, the
obligations of each shall be joint and several.

     h) If any one or more of the provisions contained in this Lease shall for
any reason be held to be invalid, illegal or unenforceable in any respect, such
invalidity, illegality or unenforceability shall not affect any other provision
of this Lease, but this Lease shall be construed as if such invalid, illegal or
unenforceable provision had never been contained herein.

     i) All exhibits attached hereto are incorporated herein as if fully set
forth.

     j) This Lease shall be governed by and construed and enforced in accordance
with the laws of the State.

                  [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

                                      -49-
<PAGE>

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

                                    LANDLORD:

                                    ENERGY (NJ) QRS 15-10, INC.,
                                    a Delaware corporation

                                    By:
                                               ---------------------------------
                                    Name: Anne R. Coolidge
                                    Title: President

                                    TENANT:

                                    FOSTER WHEELER REALTY SERVICES, INC.,
                                    a Delaware corporation

                                    By:
                                       -----------------------------------------
                                    Name:
                                         ---------------------------------------
                                    Title:
                                          --------------------------------------

                                      -50-
<PAGE>

                                                                       EXHIBIT A

                                    PREMISES

                             PART OF BLOCK 13, LOT 6
                  UNION TOWNSHIP, HUNTERDON COUNTY, NEW JERSEY

Beginning at a point in the southerly sideline of Frontage Road (50' wide) where
the same is intersected by the line dividing Block 13 Lot 6 and lands now or
formerly Foster Wheeler Corp., Block 13 Lot 7, said point being the beginning
point as described in Deed Book 984 Page 431, and from said beginning point
running;

thence (1) along the southerly sideline of Frontage Road, S 61(degree)43'03" E,
1,605.00 feet to a point;

thence (2) along a line passing through Block 13 Lot 6, South 28(0)16'57" West
811.72' to a point;

thence (3) still along the same, North 61(0)42'00" West 792.68' to a point;

thence (4) still along the same, North 81(0)43'31" West 325.42' to a point in
the line of Block 13 Lot 7;

thence (5) along Lot 7, North 01(0)56'33" West 1,002.34' to an iron pipe found;

thence (6) N 26(degree)18'27" E, 56.77 feet to the point and place of beginning.

Containing a calculated area of 1,155,681 square feet or 26.531 acres of land.

The above description is in accordance with a map entitled "Plan of Proposed
Lease Area for Foster Wheeler Corporation - Perryville I, Block 13, Lot 6, Union
Township, Hunterdon County, New Jersey" prepared by Van Cleef Engineering
Associates, Lebanon, New Jersey dated July 19, 2002, revised to August 8, 2002.

                                      A-1

<PAGE>

                                                                       EXHIBIT B

                             MACHINERY AND EQUIPMENT

All fixtures, machinery, apparatus, equipment, fittings and appliances of every
kind and nature whatsoever now or hereafter affixed or attached to or installed
in any of the Leased Premises (except as hereafter provided), including all
electrical, anti-pollution, heating, lighting (including hanging fluorescent
lighting), incinerating, power, air cooling, air conditioning, humidification,
sprinkling, plumbing, lifting, cleaning, fire prevention, fire extinguishing and
ventilating systems, devices and machinery and all engines, pipes, pumps, tanks
(including exchange tanks and fuel storage tanks), motors, conduits, ducts,
steam circulation coils, blowers, steam lines, compressors, oil burners,
boilers, doors, windows, loading platforms, lavatory facilities, stairwells,
fencing (including cyclone fencing), passenger and freight elevators, overhead
cranes and garage units, together with all additions thereto, substitutions
therefor and replacements thereof required or permitted by this Lease, but
excluding all personal property and all trade fixtures, machinery, office,
manufacturing and warehouse equipment which are not necessary to the operation
of the buildings which constitute part of the Leased Premises for the uses
permitted under Paragraph 4(a) of this Lease.

                                      B-1

<PAGE>

                                                                       EXHIBIT C

                             PERMITTED ENCUMBRANCES

                                      C-1

<PAGE>

                                                                       EXHIBIT D

                               BASIC RENT PAYMENTS

1.         BASIC RENT. Subject to the adjustments provided for in Paragraphs 2,
3 and 4 below, Basic Rent payable in respect of the Term shall be $5,230,850 per
annum, payable quarterly in advance on each Basic Rent Payment Date, in equal
installments of $1,307,712.50 each. Pro rata Basic Rent for the period from the
date hereof through the twenty-fourth day of August, 2002 shall be paid on the
date hereof, and pro rata Basic Rent for the period from the twenty-fifth day of
the last month of the Term through the last day of the last month of the Term
shall be paid with the final quarterly installment of Basic Rent.

2.         CPI ADJUSTMENTS TO BASIC RENT. The Basic Rent shall be subject to
adjustment, in the manner hereinafter set forth, for increases in the index
known as United States Department of Labor, Bureau of Labor Statistics, Consumer
Price Index, All Urban Consumers, United States City Average, All Items,
(1982-84=100) ("CPI") or the successor index that most closely approximates the
CPI. If the CPI shall be discontinued with no successor or comparable successor
index, Landlord and Tenant shall attempt to agree upon a substitute index or
formula, but if they are unable to so agree, then the matter shall be determined
by arbitration in accordance with the rules of the American Arbitration
Association then prevailing in New York City. Any decision or award resulting
from such arbitration shall be final and binding upon Landlord and Tenant and
judgment thereon may be entered in any court of competent jurisdiction. In no
event will the Basic Rent as adjusted by the CPI adjustment be less than the
Basic Rent in effect for the year period immediately preceding such adjustment.

3.         EFFECTIVE DATES OF CPI ADJUSTMENTS. Basic Rent shall not be adjusted
to reflect changes in the CPI until the third (3rd) anniversary of the Basic
Rent Payment Date on which the first full quarterly installment of Basic Rent
shall be due and payable (the "FIRST FULL BASIC RENT PAYMENT DATE"). As of the
third (3rd) anniversary of the First Full Basic Rent Payment Date and thereafter
on the sixth (6th), ninth (9th), twelfth (12th), fifteenth (15th), eighteenth
(18th), and, if the initial Term is extended, on the twenty-first (21st),
twenty-fourth (24th), twenty-seventh (27th), thirtieth (30th), thirty-third
(33rd), thirty-sixth (36th) and thirty-ninth (39th) anniversaries of the First
Full Basic Rent Payment Date, Basic Rent shall be adjusted to reflect increases
in the CPI during the most recent three (3) year period immediately preceding
each of the foregoing dates (each such date being hereinafter referred to as the
"BASIC RENT ADJUSTMENT DATE").

                                      D-1
<PAGE>

4.         METHOD OF ADJUSTMENT FOR CPI ADJUSTMENT.

     (a) As of each Basic Rent Adjustment Date when the average CPI determined
in clause (i) below exceeds the Beginning CPI (as defined in this Paragraph
4(a)), the Basic Rent in effect immediately prior to the applicable Basic Rent
Adjustment Date shall be multiplied by a fraction, the numerator of which shall
be the difference between (i) the average CPI for the three (3) most recent
calendar months (the "PRIOR MONTHS") ending prior to such Basic Rent Adjustment
Date for which the CPI has been published on or before the forty-fifth (45th)
day preceding such Basic Rent Adjustment Date and (ii) the Beginning CPI, and
the denominator of which shall be the Beginning CPI. An amount equal to the
lesser of (x) the product of such multiplication or 10.07% of the Basic Rent in
effect immediately prior to such Basic Rent Adjustment Date shall be added to
the Basic Rent in effect immediately prior to such Basic Rent Adjustment Date.
As used herein, "BEGINNING CPI" shall mean the average CPI for the three (3)
calendar months corresponding to the Prior Months, but occurring three (3) years
earlier. If the average CPI determined in clause (i) is the same or less than
the Beginning CPI, the Basic Rent will remain the same for the ensuing three (3)
year period.

     (b) Effective as of a given Basic Rent Adjustment Date, Basic Rent payable
under this Lease until the next succeeding Basic Rent Adjustment Date shall be
the Basic Rent in effect after the adjustment provided for as of such Basic Rent
Adjustment Date.

     (c) Notice of the new annual Basic Rent shall be delivered to Tenant on or
before the tenth (10th) day preceding each Basic Rent Adjustment Date, but any
failure to do so by Landlord shall not be or be deemed to be a waiver by
Landlord of Landlord's rights to collect such sums. Tenant shall pay to
Landlord, within ten (10) days after a notice of the new annual Basic Rent is
delivered to Tenant, all amounts due from Tenant, but unpaid, because the stated
amount as set forth above was not delivered to Tenant at least ten (10) days
preceding the Basic Rent Adjustment Date in question.

                                      D-2
<PAGE>

                                                                       EXHIBIT E

                               OPERATING COVENANTS

           1. Tenant shall, and shall cause Guarantor and its respective
subsidiaries to, comply (A) with the covenants set forth in Article VI of that
certain Third Amended and Restated Term Loan and Revolving Credit Agreement,
dated as of August 2, 2002 among Foster Wheeler LLC, Foster Wheeler USA
Corporation, Foster Wheeler Power Group, Inc. Foster Wheeler Energy Corporation,
certain guarantors, certain lenders and Bank of America, N.A., as Administrative
Agent and Collateral Agent (the "Lender") (the "CREDIT AGREEMENT"), in the same
manner and to the same effect as if the terms of Article VI of the Credit
Agreement were set forth in full herein and (B) upon refinancing of the debt
described in the Credit Agreement, with the covenants set forth in the credit
agreement that replaces the Credit Agreement (any such replacement credit
agreement, the "SENIOR CREDIT AGREEMENT") pertaining to the matters addressed in
Article VI of the Credit Agreement in the same manner and to the same effect as
if the terms of such covenants of the Senior Credit Agreement were set forth
herein, and subject to the conditions set forth in the following sentence, after
giving effect to any modification, amendment or waiver of the Credit Agreement
or Senior Credit Agreement, as the case may be, a copy of which has been
delivered to Landlord, and for such purpose such terms of Article VI of the
Credit Agreement or Senior Credit Agreement, as the case may be, and such other
relevant provisions and definitions of the Credit Agreement or Senior Credit
Agreement, as the case may be, as are expressly referenced therein and
amendments, modifications, and waivers thereto are incorporated herein by
reference. Notwithstanding, and in limitation of, the foregoing, no amendment or
modification to, or waiver of, Article VI of the Credit Agreement or Senior
Credit Agreement, as the case may be, shall be effective and binding upon
Landlord (a) if the Lender or lender or lenders that replace the Lender (the
Lender or such replacement lender, the "SENIOR LENDER") receives or is entitled
to receive any payment or grant any other consideration ("SENIOR LENDER
CONSIDERATION") as a condition to such amendment, modification or waiver or, if
such consideration is required, unless concurrently with payment to the Senior
Lender Landlord receives Landlord's Consideration and (b) unless such amendment
or modification is executed or waiver granted no later than the earlier to occur
of (x) sixty (60) days following the earlier to occur of the date on which
Tenant notified the Senior Lender or the Senior Lender had actual knowledge of
the breach under the Credit Agreement or Senior Credit Agreement, as the case
may be, that gave rise to the need for an amendment, modification or waiver and
(y) the earlier of the date on which the Senior Lender causes the obligations of
Tenant and/or Guarantor under the Credit Agreement or the Senior Credit
Agreement, as the case may be, to become due prior to their stated maturity, or
sixty (60) days after Landlord notified Tenant of a breach of any covenant. If
at any time Tenant shall not be subject to the Credit Agreement or any Senior
Credit Agreement that contains covenants pertaining to the matters addressed in
Article VI of the Credit Agreement, Tenant shall, and shall cause Guarantor and
each of its subsidiaries to, comply with the covenants set forth in the most
recent Senior Credit Agreement pertaining to the matters addressed in Article VI
of the Credit Agreement in the same manner and to the same effect as if the
terms of the applicable provisions of such Senior Credit Agreement were set
forth in full herein, and giving effect to any modification, amendment or waiver
thereto that complies with the provisions of the foregoing sentence.

                                      E-1

<PAGE>

           2. A copy of the relevant provisions of Article VI of the Credit
Agreement, and the amendments thereto, as the same are in effect on the date
hereof, are attached hereto.

           3. For purposes of this Exhibit "E", (a) "Senior Lender's
Consideration" shall mean any consideration received by the Senior Lender as a
fee for the modification, amendment or waiver, but shall not include any payment
on account or in reduction of the indebtedness described in the Credit Agreement
or the Senior Credit Agreement, and (b) "Landlord's Consideration" shall be an
amount equal to the Senior Lender's Consideration, multiplied by a fraction, the
numerator of which is the Acquisition Cost and the denominator of which is the
amount of the current aggregate loan amount (as defined in the Credit Agreement)
or the maximum amount of credit available under the Senior Credit Agreement, as
the case may be. Landlord's Consideration shall be paid to Landlord upon the
same terms that Senior Lender's Consideration is paid to the Senior Lender;
provided, however, that Landlord's Consideration shall not exceed the lesser of
(x) $350,000 (plus Landlord's reasonable out of pocket costs), and (y) the
Senior Lender's Consideration received by the Senior Lender (plus Landlord's
reasonable out of pocket costs). Notwithstanding that any payment on account or
in reduction of the indebtedness described in the Credit Agreement or the Senior
Credit Agreement shall be made, no payment shall be required to be made to
Landlord as Landlord's consideration unless a Senior Lender Consideration is
paid concurrently with such payment on account or in reduction of the
indebtedness.

                                      E-2
<PAGE>

                                                                       EXHIBIT F

I.   ROOF REPAIRS (To be completed by January 31, 2003)

     Replacement of the 25% of the roof located in the eastern section of
          the building.

    Estimated Cost ..................................................$131,250.00

                                      F-1

<PAGE>===============================================================================

                           LOAN AND SECURITY AGREEMENT

                                  BY AND AMONG

                           FOSTER WHEELER FUNDING LLC

                                  AS BORROWER,

                     THE LENDERS THAT ARE SIGNATORIES HERETO

                                 AS THE LENDERS,

                                       AND

                          FOOTHILL CAPITAL CORPORATION

                    AS THE ARRANGER AND ADMINISTRATIVE AGENT

                           DATED AS OF AUGUST 15, 2002

===============================================================================

<PAGE>

                           LOAN AND SECURITY AGREEMENT

                     THIS LOAN AND SECURITY AGREEMENT (this "Agreement"), is
entered into as of August 15, 2002, between and among, on the one hand, the
lenders identified on the signature pages hereof (such lenders, together with
their respective successors and assigns, are referred to hereinafter each
individually as a "Lender" and collectively as the "Lenders"), FOOTHILL CAPITAL
CORPORATION, a California corporation, as the arranger and administrative agent
for the Lenders ("Agent"), and, on the other hand, FOSTER WHEELER FUNDING LLC, a
Delaware limited liability company ("Borrower").

                     The parties agree as follows:

1.         DEFINITIONS AND CONSTRUCTION.

1.1        DEFINITIONS.  As used in this Agreement, the following terms shall
have the following definitions:

            "Account Debtor" means any Person who is or who may become obligated
under, with respect to, or on account of, an Account, chattel paper, or a
General Intangible.

            "Accounts" means all of Borrower's now owned or hereafter acquired
right, title, and interest with respect to any right to receive payment, whether
constituting an "account", "chattel paper", "instrument" or "general intangible"
(as each such term is defined in the Code), and any and all supporting
obligations in respect thereof.

            "Additional Documents" has the meaning set forth in SECTION 4.4.

            "Additional Originator" means any Originator made a party to the
Purchase Agreement after the Closing Date in accordance with Section 10.12 of
the Purchase Agreement.

            "Advances" has the meaning set forth in SECTION 2.1.

            "Affiliate" means, as applied to any Person, any other Person who,
directly or indirectly, controls, is controlled by, or is under common control
with, such Person. For purposes of this definition, "control" means the
possession, directly or indirectly, of the power to direct the management and
policies of a Person, whether through the ownership of Stock, by contract, or
otherwise; PROVIDED, HOWEVER, that, in any event: (a) any Person which owns
directly or indirectly 10% or more of the securities having ordinary voting
power for the election of directors or other members of the governing body of a
Person or 10% or more of the partnership or other ownership interests of a
Person (other than as a limited partner of such Person) shall be deemed to
control such Person, (b) each director (or comparable manager) of a Person shall
be deemed to be an Affiliate of such Person, and (c) each partnership or joint
venture in which a Person is a partner or joint venturer shall be deemed to be
an Affiliate of such Person, PROVIDED FURTHER that, solely for purposes of
clause (c) of the definition of "Eligible Accounts", a partnership or joint
venture in which a Person is a partner or joint venturer shall not be deemed to
be an Affiliate of such Person unless such Person owns directly or indirectly 5%
or more of the outstanding Stock of such partnership or joint venture or
otherwise possesses, directly or indirectly, the power to direct the management
and policies of such partnership or joint venture.

<PAGE>

            "Agent" means Foothill, solely in its capacity as agent for the
Lenders hereunder, and any successor thereto.

            "Agent's Account" means an account at a bank designated by Agent
from time to time as the account into which Borrower shall make all payments to
Agent for the benefit of the Lender Group and into which the Lender Group shall
make all payments to Agent under this Agreement and the other Loan Documents;
unless and until Agent notifies Borrower and the Lender Group to the contrary,
Agent's Account shall be that certain deposit account bearing account number
323-266193 and maintained by Agent with JPMorgan Chase Bank, 4 New York Plaza,
15th Floor, New York, New York 10004, ABA #021000021.

            "Agent Advances" has the meaning set forth in SECTION 2.3(E)(I).

            "Agent's Liens" means the Liens granted by Borrower to Agent for the
benefit of the Lender Group under this Agreement or the other Loan Documents.

            "Agent-Related Persons" means Agent together with its Affiliates,
officers, directors, employees, and agents.

            "Agreement" has the meaning set forth in the preamble hereto.

            "Applicable Prepayment Premium" means, as of any date of
determination, an amount equal to (a) during the period of time from and after
the date of the execution and delivery of this Agreement up to the date that is
the first anniversary of the Closing Date, 3.0% times the Maximum Revolver
Amount, (b) during the period of time from and including the date that is the
first anniversary of the Closing Date up to the date that is the second
anniversary of the Closing Date, 2.0% times the Maximum Revolver Amount, and (c)
during the period of time from and including the date that is the second
anniversary of the Closing Date up to the Maturity Date, 1.0% times the Maximum
Revolver Amount.

            "A/R Turnover Period" means, as of the end of any calendar month,
the number of days equal to the product of (a) a fraction, the numerator of
which shall be the aggregate amount of Accounts as of the first day of such
month, and the denominator of which shall be the aggregate amount of Collections
with respect to Accounts during such month, TIMES (b) 30 days.

            "Asset Sale" means any sale, lease or other disposition (including
any such transaction effected by way of merger or consolidation) by FW LLC or
any of its Subsidiaries of any asset, including, without limitation, any
Sale/Leaseback Transaction, whether or not involving a capital lease, but
excluding (a) dispositions of inventory, equipment or materials in the ordinary
course of business, (b) dispositions of Temporary Cash Investments and cash
payments otherwise permitted under the Existing Credit Agreement, (c)
dispositions pursuant to a Securitization Transaction, (d) dispositions to any
Existing Credit Party or any wholly-owned Subsidiary thereof, (e) the sale or
discount, in each case without recourse, of accounts receivable arising in the
ordinary course of business, but only in connection with the compromise or
collection thereof, (f) licenses or sublicenses of intellectual property and
other know-how in the ordinary course of business and (g) subleases of real
property in the ordinary course of business. To the extent that, in connection
with a reduction in the proportionate interest of FW LLC or any of its
Subsidiaries in a joint venture, FW LLC or any of its Subsidiaries receives Net
Cash Proceeds (determined as if such transaction were an Asset Sale), then such
transaction shall be treated as an Asset Sale to the extent of such Net Cash
Proceeds.

                                      -2-

<PAGE>

            "Assignee" has the meaning set forth in SECTION 14.1.

            "Assignment and Acceptance" means an Assignment and Acceptance in
the form of Exhibit A-1.

            "Authorized Person" means any officer or other employee of Borrower.

            "Availability" means, as of any date of determination, if such date
is a Business Day, and determined at the close of business on the immediately
preceding Business Day, if such date of determination is not a Business Day, the
amount that Borrower is entitled to borrow as Advances under SECTION 2.1 (after
giving effect to all then outstanding Obligations and all sublimits and reserves
applicable hereunder).

            "Bankruptcy Code" means the United States Bankruptcy Code, as in
effect from time to time.

            "Base Rate" means, the rate of interest announced within Wells Fargo
at its principal office in San Francisco as its "prime rate", with the
understanding that the "prime rate" is one of Wells Fargo's base rates (not
necessarily the lowest of such rates) and serves as the basis upon which
effective rates of interest are calculated for those loans making reference
thereto and is evidenced by the recording thereof after its announcement in such
internal publication or publications as Wells Fargo may designate.

            "Base Rate Margin" means 3.0 percentage points.

            "Benefit Plan" means a "defined benefit plan" (as defined in SECTION
3(35) of ERISA) for which Borrower or any ERISA Affiliate of Borrower has been
an "employer" (as defined in SECTION 3(5) of ERISA) within the past six years.

            "Board of Directors" means the board of directors (or comparable
managers) of Borrower or any committee thereof duly authorized to act on behalf
of the board.

            "Books" means Borrower's now owned or hereafter acquired books and
records (including all of its Records indicating, summarizing, or evidencing its
assets (including the Collateral) or liabilities, all of its Records relating to
its business operations or financial condition, and all of its goods or General
Intangibles related to such information).

            "Borrower" has the meaning set forth in the preamble to this
Agreement.

            "Borrowing" means a borrowing hereunder consisting of Advances made
on the same day by the Lenders (or Agent on behalf thereof), or by Swing Lender
in the case of a Swing Loan, or by Agent in the case of an Agent Advance.

                                      -3-

<PAGE>

            "Borrowing Base" has the meaning set forth in SECTION 2.1.

            "Borrowing Base Certificate" means a certificate in the form of
EXHIBIT B-1.

            "Business Day" means any day that is not a Saturday, Sunday, or
other day on which national banks are authorized or required to close.

            "Capital Expenditures" means, with respect to any Person for any
period, the sum of (i) the aggregate of all expenditures by such Person and its
Subsidiaries during such period that in accordance with GAAP are or should be
included in "property, plant and equipment" or in a similar fixed asset account
on its balance sheet, whether such expenditures are paid in cash or financed and
including all Capitalized Lease Obligations paid or payable during such period,
and (ii) to the extent not covered by clause (i) above, the aggregate of all
expenditures by such Person and its Subsidiaries during such period to acquire
by purchase or otherwise the business or fixed assets of, or the capital Stock
of, any other Person.

            "Capital Lease" means a lease that is required to be capitalized for
financial reporting purposes in accordance with GAAP.

            "Capitalized Lease Obligation" means any Indebtedness represented by
obligations under a Capital Lease.

            "Cash Equivalents" means (a) marketable direct obligations issued or
unconditionally guaranteed by the United States or issued by any agency thereof
and backed by the full faith and credit of the United States, in each case
maturing within 1 year from the date of acquisition thereof, (b) marketable
direct obligations issued by any state of the United States or any political
subdivision of any such state or any public instrumentality thereof maturing
within 1 year from the date of acquisition thereof and, at the time of
acquisition, having the highest rating obtainable from either S&P or Moody's,
(c) commercial paper maturing no more than 1 year from the date of acquisition
thereof and, at the time of acquisition, having a rating of A-1 or P-1, or
better, from S&P or Moody's, (d) certificates of deposit or bankers' acceptances
maturing within 1 year from the date of acquisition thereof either (i) issued by
any bank organized under the laws of the United States or any state thereof
which bank has a rating of A or A2, or better, from S&P or Moody's, or (ii)
certificates of deposit less than or equal to $100,000 in the aggregate issued
by any other bank insured by the Federal Deposit Insurance Corporation, and (e)
any shares of money market mutual funds having assets in excess of $500,000,000
which are invested in instruments of the kind described in clauses (a), (b), (c)
or (d) hereof.

            "Cash Management Bank" has the meaning set forth in SECTION 2.7(A).

            "Cash Management Account" has the meaning set forth in SECTION
2.7(A).

            "Cash Management Agreements" means those certain cash management
service agreements, in form and substance satisfactory to Agent, each of which
is among Agent, Borrower and the Cash Management Bank.

                                      -4-

<PAGE>

            "Change of Control" means (a) Servicer and the Originators cease to
directly own and control 100% of the outstanding capital Stock of Borrower, free
and clear of all Liens, other than the Lien securing the obligations under the
Existing Credit Documents, or (b) Parent ceases to own, directly or indirectly,
100% of the outstanding capital Stock of Borrower, Servicer and each Originator,
free and clear of all Liens, other than the Lien securing the obligations under
the Existing Credit Documents.

            "Closing Date" means the date of the making of the initial Advance
(or other extension of credit) hereunder.

            "Closing Date Business Plan" means the set of Projections of the
Originators for the period following the Closing Date through December 31, 2002
(on a month by month basis, and for the 1 year period thereafter, on a quarter
by quarter basis), in form and substance (including as to scope and underlying
assumptions) satisfactory to Agent.

            "Code" means the New York Uniform Commercial Code, as in effect from
time to time.

            "Collateral" means all assets of the Borrower, including all of
Borrower's now owned or hereafter acquired right, title, and interest in and to
each of the following:

            1. Accounts,

            2. Books,

            3. Equipment,

            4. General Intangibles,

            5. Inventory,

            6. Investment Property,

            7. Negotiable Collateral,

            8. money, deposit accounts or other assets of Borrower that now or
hereafter come into the possession, custody, or control of any member of the
Lender Group, and

            9. the proceeds and products, whether tangible or intangible, of any
of the foregoing, including proceeds of insurance covering any or all of the
foregoing, and any and all Accounts, Books, Equipment, General Intangibles,
Inventory, Investment Property, Negotiable Collateral, money, deposit accounts,
or other tangible or intangible property resulting from the sale, exchange,
collection, or other disposition of any of the foregoing, or any portion thereof
or interest therein, and the proceeds thereof.

            "Collateral Access Agreement" means a landlord waiver,
acknowledgement agreement or other written waiver or acknowledgement of any
lessor or other Person in possession of, having a Lien upon, or having rights or
interests in any of the books and records of Borrower, Servicer or any
Originator relating to any of the Subject Accounts or the Collateral, in each
case, in form and substance satisfactory to Agent.

                                      -5-

<PAGE>

            "Collections" means all cash, checks, notes, instruments, and other
items of payment (including insurance proceeds, proceeds of cash sales, rental
proceeds, and tax refunds) of Borrower and shall in any event include all
"Collections" as such term is defined in the Purchase Agreement.

            "Commitment" means, with respect to each Lender, its Commitment,
and, with respect to all Lenders, their Commitments, in each case as such Dollar
amounts are set forth beside such Lender's name under the applicable heading on
Schedule C-1 or on the signature page of the Assignment and Acceptance pursuant
to which such Lender became a Lender hereunder in accordance with the provisions
of SECTION 14.1.

            "Companies" means Parent and the Subsidiaries of Parent, including
Borrower, Servicer and the Originators.

            "Compliance Certificate" means a certificate substantially in the
form of Exhibit C-1 delivered by the chief financial officer of Borrower to
Agent.

            "Consolidated Adjusted EBITDA" for any period, with respect to
Parent and its consolidated Subsidiaries, means the sum of (a) Consolidated Net
Income for such period and (b) to the extent deducted in determining
Consolidated Net Income, (i) Consolidated Adjusted Interest Expense for such
period, (ii) charges against income for foreign, federal, state and local income
taxes for such period and (iii) the amount of all expenses for depreciation and
amortization for such period, all as determined on a consolidated basis in
accordance with GAAP; PROVIDED that, if an Asset Sale occurs during such period,
"Consolidated Adjusted EBITDA" shall be determined after giving pro forma effect
thereto as if such Asset Sale had occurred at the beginning of such period.

            "Consolidated Adjusted Interest Expense" for any period means the
sum, without duplication, of (a) the total interest expense of Parent and its
consolidated Subsidiaries, (b) the portion of rental expense in respect of
Financing Leases representative of an interest factor and (c) any dividend paid
or accrued on the Trust Preferred, in each case for such period and determined
on a consolidated basis in accordance with GAAP.

            "Consolidated Net Income" for any period means the net earnings (or
loss) after taxes of Parent and its consolidated Subsidiaries for such period as
determined on a consolidated basis in accordance with GAAP; provided that
"Consolidated Net Income" shall not include, without duplication, (i) any gains
or losses (A) from Asset Sales or other Prepayment Events, (B) that are (x)
extraordinary or (y) non-cash and nonrecurring or unusual or (C) that are
associated with claims settlements, (ii) any additions to reserves for asbestos
liabilities which are not offset by a corresponding increase in insurance
recoveries and which are not a cash item during the period for which
Consolidated Net Income is to be determined (provided that Consolidated Net
Income shall include any cash expenses in respect of asbestos liabilities during
the period for which Consolidated Net Income is to be determined which are (x)
charged against a reserve referred to in this clause (ii) which was established

                                      -6-

<PAGE>

in a prior period (but only to the extent such reserves were taken from and
after the first day of the Company's fiscal quarter beginning closest to April
1, 2002) and (y) not otherwise deducted in the determination of such
Consolidated Net Income), (iii) any income recorded as a result of commuting
insurance policies that relate to asbestos exposure and (iv) non-cash charges
relating to writedowns of assets to market value and writedowns of claims.

            "Contract" means, with respect to any Subject Account, any and all
contracts, instruments, agreements, leases, invoices, notes or other writings
pursuant to which such Subject Account arises or that evidence such Subject
Account or under which the applicable Account Debtor becomes or is obligated to
make payment in respect of such Subject Account.

            "Contract Trial Balance" means a monthly report on each Contract,
updated to reflect any changes in earned revenue to date, final estimated
profits and actual costs to date.

            "Control Agreement" means a control agreement, in form and substance
satisfactory to Agent, executed and delivered by Borrower, Agent, and the
applicable securities intermediary with respect to a Securities Account or bank
with respect to a deposit account.

            "Convertible Subordinated Notes" shall mean Parent's 6.50%
Subordinated Convertible Notes due 2007 issued pursuant to the Indenture dated
as of May 31, 2001 among Parent, FW LLC and BNY Midwest Trust Company.

            "Credit and Collection Policy" means those receivables credit and
collection policies and practices of the Originators in effect on the Closing
Date and described in SCHEDULE C-2, as modified with the written consent of
Agent.

            "Daily Balance" means, with respect to each day during the term of
this Agreement, the amount of an Obligation owed at the end of such day.

            "DDA" means any checking or other demand deposit account maintained
by Borrower.

            "Debt Documents" means the Existing Credit Documents, the
Indentures, the Trust Preferred, the Robbins Debt Documents, the Perryville
Lease Facilities and each other agreement or instrument pursuant to which
Parent, FW LLC, Servicer, any Originator or Borrower has incurred Indebtedness
to another Person (other than to another Company) in excess of $10,000,000 but
excluding the Transaction Documents.

            "Debt Incurrence" means any incurrence of Indebtedness after May 9,
2002 by FW LLC or any of its Subsidiaries that results in Net Cash Proceeds,
other than the incurrence of (i) an aggregate amount of up to $50,000,000 of
Indebtedness from a Securitization Transaction outstanding at any time, (ii)
$32,829,119 of Indebtedness under the Perryville Lease Facilities and (iii) any
other Indebtedness permitted by Section 6.03 of the Existing Credit Agreement as
in effect on the date hereof (except subsections (f), (g) and (k) thereof).

            "Default" means an event, condition, or default that, with the
giving of notice, the passage of time, or both, would be an Event of Default.

                                      -7-

<PAGE>

            "Defaulting Lender" means any Lender that fails to make any Advance
(or other extension of credit) that it is required to make hereunder on the date
that it is required to do so hereunder.

            "Defaulting Lender Rate" means (a) the Base Rate for the first 3
days from and after the date the relevant payment is due, and (b) thereafter, at
the interest rate then applicable to Advances (inclusive of the Base Rate Margin
applicable thereto).

            "Delinquency Ratio" means, as of any date, the ratio, expressed as a
percentage, of (a) the aggregate amount of all Accounts as to which payment, or
any part thereof, remains unpaid for more than 90 days from the original invoice
date, to (b) the aggregate amount of all Accounts.

            "Designated Account" means account number 200-0011-054-483 of
Borrower maintained with Borrower's Designated Account Bank, or such other
deposit account of Borrower (located within the United States) that has been
designated as such, in writing, by Borrower to Agent.

            "Designated Account Bank" means Wachovia Bank, N.A., whose office is
located at 191 Peachtree Street, NE, Mail Code GA 8056, Atlanta, GA 30303, Attn:
Christopher Tierney, and whose ABA number is 031201467.

            "Dilution" means, as of any date of determination, a percentage,
based upon the experience of the immediately prior 90 days, that is the result
of dividing the Dollar amount of (a) bad debt write-downs, discounts,
advertising allowances, credits, or other dilutive items with respect to the
Accounts during such period, by (b) Borrower's Collections with respect to
Accounts during such period (excluding extraordinary items) plus the Dollar
amount of clause (a), PROVIDED that, for purposes of the financial covenant
contained in SECTION 7.20(A)(III), such percentage shall be based upon the
experience of the immediately prior six-month period.

            "Dilution Reserve" means, as of any date of determination, an amount
sufficient to reduce the advance rate against Eligible Accounts by one
percentage point for each percentage point by which Dilution is in excess of
5.0%.

            "Disbursement Letter" means an instructional letter executed and
delivered by Borrower to Agent regarding the extensions of credit to be made on
the Closing Date, the form and substance of which is satisfactory to Agent.

            "Dollars" or "$" means United States dollars.

            "Domestic Subsidiary" means any Subsidiary of Parent which is not a
Foreign Subsidiary.

            "Eligible Accounts" means those Subject Accounts acquired from time
to time by Borrower from any Originator pursuant to the Purchase Agreement that
comply with each of the representations and warranties respecting Eligible
Accounts made by Borrower in the Loan Documents, and that are not excluded as
ineligible by virtue of one or more of the criteria set forth below; PROVIDED,
HOWEVER, that such criteria may be fixed and revised from time to time by Agent

                                      -8-

<PAGE>

in Agent's Permitted Discretion to address the results of any audit performed by
Agent from time to time after the Closing Date. In determining the amount to be
included, Eligible Accounts shall be calculated net of customer deposits and
unapplied cash remitted by the applicable Account Debtor. Eligible Accounts
shall not include the following:

            (a) Accounts that the Account Debtor has failed to pay within 90
days of original invoice date or Accounts with selling terms of more than 90
days,

            (b) Accounts owed by an Account Debtor (or its Affiliates) where 50%
or more of all Accounts owed by that Account Debtor (or its Affiliates) are
deemed ineligible under clause (a) above,

            (c) Accounts with respect to which the Account Debtor is an
employee, Affiliate, or agent of Borrower, the Servicer, any Originator or any
other Company,

            (d) Accounts which do not arise under a duly authorized Contract,

            (e) Accounts for which the related Contract is not in full force and
effect or is otherwise not a legal, valid and binding obligation of the related
Account Debtor, enforceable against such Account Debtor in accordance with its
terms,

            (f) Accounts (i) in which Borrower does not own good and marketable
title, free and clear of any Liens other than Permitted Liens, or (ii) that are
not freely assignable by Borrower (including without any consent of the related
Account Debtor),

            (g) Accounts that fail to conform in all material respects with all
applicable laws, rulings and regulations in effect,

            (h) Accounts that fail to satisfy, in any material respect, all
applicable requirements of the Credit and Collection Policy,

            (i) Accounts that have been modified, waived or restructured since
their creation, except as permitted pursuant to SECTION 7.10,

            (j) Accounts arising in a transaction wherein goods are placed on
consignment or are sold pursuant to a guaranteed sale, a sale or return, a sale
on approval, a bill and hold, or any other terms by reason of which the payment
by the Account Debtor may be conditional,

            (k) Accounts that are either not payable in Dollars or not
denominated in Dollars,

            (l) Accounts with respect to which the Account Debtor either (i)
does not maintain its chief executive office in the United States, or (ii) is
not organized under the laws of the United States or any state thereof, or (iii)
is the government of any foreign country or sovereign state, or of any state,
province, municipality, or other political subdivision thereof, or of any
department, agency, public corporation, or other instrumentality thereof, unless
(y) the Account is supported by an irrevocable letter of credit satisfactory to
Agent (as to form,

                                      -9-

<PAGE>

substance, and issuer or domestic confirming bank) that has been delivered to
Agent and is directly drawable by Agent, or (z) the Account is covered by
credit insurance in form, substance, and amount, and by an insurer,
satisfactory to Agent,

            (m) Accounts with respect to which the Account Debtor is either (i)
the United States or any department, agency, or instrumentality of the United
States (exclusive, however, of Accounts with respect to which Borrower or any
Originator has complied, to the reasonable satisfaction of Agent, with the
Assignment of Claims Act, 31 USC ss. 3727), or (ii) any state of the United
States (exclusive, however, of (y) Accounts owed by any state that does not have
a statutory counterpart to the Assignment of Claims Act, or (z) Accounts owed by
any state that does have a statutory counterpart to the Assignment of Claims Act
as to which Borrower or any Originator has complied to Agent's satisfaction),

            (n) Accounts with respect to which the Account Debtor is a creditor
of any Company, has or has asserted a right of setoff, has disputed its
liability, or has made any claim with respect to its obligation to pay the
Account, to the extent of such claim, right of setoff, or dispute,

            (o) Accounts with respect to an Account Debtor whose total
obligations owing to Borrower exceed 10% of all Eligible Accounts, to the extent
of the obligations owing by such Account Debtor in excess of such percentage,

            (p) Accounts with respect to which the Account Debtor is subject to
an Insolvency Proceeding, is not Solvent, has gone out of business, or as to
which any Company has received notice of an imminent Insolvency Proceeding or a
material impairment of the financial condition of such Account Debtor,

            (q) Accounts with respect to which the Account Debtor is located in
the states of New Jersey, Minnesota, or West Virginia (or any other state that
requires a creditor to file a business activity report or similar document in
order to bring suit or otherwise enforce its remedies against such Account
Debtor in the courts or through any judicial process of such state), unless
Servicer has qualified to do business in New Jersey, Minnesota, West Virginia,
or such other states, or has filed a business activities report with the
applicable division of taxation, the department of revenue, or with such other
state offices, as appropriate, for the then-current year, or is exempt from such
filing requirement,

            (r) Accounts, the collection of which, Agent, in its Permitted
Discretion, believes to be doubtful by reason of the Account Debtor's financial
condition,

            (s) Accounts that are not subject to a valid and perfected first
priority Agent's Lien,

            (t) Accounts with respect to which (i) the goods giving rise to such
Account have not been shipped and billed to the Account Debtor, or (ii) the
services giving rise to such Account have not been performed and billed to the
Account Debtor,

                                      -10-

<PAGE>

            (u) Accounts, or the portion thereof, that represent retention, the
right to receive progress payments or other advance billings that are due prior
to the completion of performance by the applicable Originator of the subject
contract for goods or services,

            (v) Accounts that are due in respect of any project which is less
than 50% complete,

            (w) Accounts in respect of which a surety bond, performance bond or
similar instrument grants a lien or common law right of subrogation in favor of
the issuer of such bond or instrument was provided in favor of the Account
Debtor for the purpose of supporting the obligations of the applicable
Originator to such Account Debtor,

            (x) Accounts that are evidenced by instruments or chattel paper; or

            (y) Accounts purchased from an Originator with respect to which a
Single Originator Default has occurred to the extent that Borrower has requested
and received a waiver of the Event of Default resulting from such Single
Originator Default in accordance with SECTION 8.

            In addition to, and without limitation of, the preceding
requirements and any requirements set forth in the Purchase Agreement, prior to
any Subject Account acquired from any Additional Originator becoming an
"Eligible Account", Agent shall have first received (i) a financial audit for
such Additional Originator, the results of which shall be satisfactory to Agent,
(ii) updated Projections for the Originators (including such Additional
Originator), in form and substance satisfactory to Agent, (iii) the results of a
UCC, tax and judgment lien search, showing the absence of any Lien on the
Subject Accounts of such Additional Originator, (iv) satisfactory legal opinions
with respect to such Additional Originator and comparable to the legal opinions
delivered on the Closing Date (including as to "true sale" and "substantive
non-consolidation"), (v) a UCC financing statement with respect to the Subject
Accounts of such Additional Originator, naming such Additional Originator as
debtor, Borrower as secured party and Agent as assignee and in appropriate form
for filing with the Secretary of State of the state of organization of such
Additional Originator, and (vi) such other documents as Agent may reasonably
request, including, without limitation, amendments and/or joinder agreements
adding such Additional Originator as a party to the Purchase Agreement.

            "Eligible Affiliate Transferee" means any Affiliate (other than
individuals) of a Lender that was party hereto as of the Closing Date,
including, without limitation, a Related Fund.

            "Eligible Subject Accounts" means Subject Accounts which, if
acquired by Borrower pursuant to the Purchase Agreement, would qualify as
Eligible Accounts under this Agreement.

            "Eligible Transferee" means (a) a commercial bank organized under
the laws of the United States, or any state thereof, and having total assets in
excess of $250,000,000, (b) a commercial bank organized under the laws of any
other country which is a member of the Organization for Economic Cooperation and
Development or a political subdivision of any such country and which has total
assets in excess of $250,000,000, provided that such bank is acting through a

                                      -11-

<PAGE>

branch or agency located in the United States, (c) a finance company, insurance
company, or other financial institution or fund that is engaged in making,
purchasing, or otherwise investing in commercial loans in the ordinary course of
its business and having (together with its Affiliates) total assets in excess of
$250,000,000, (d) any Eligible Affiliate Transferee, (e) so long as no Event of
Default has occurred and is continuing, any other Person approved by Agent and
Borrower, and (f) during the continuation of an Event of Default, any other
Person approved by Agent.

            "Equipment" means all of Borrower's now owned or hereafter acquired
right, title, and interest with respect to equipment, machinery, machine tools,
motors, furniture, furnishings, fixtures, vehicles (including motor vehicles),
tools, parts, goods (other than consumer goods, farm products, or Inventory),
wherever located, including all attachments, accessories, accessions,
replacements, substitutions, additions, and improvements to any of the
foregoing.

            "Equity Issuance" means any issuance of equity securities (including
any preferred equity securities) by Parent or any Subsidiary of Parent, other
than (i) equity securities issued to Parent or any Subsidiary of Parent, (ii)
equity securities issued pursuant to employee benefit and/or dividend
reinvestment plans in the ordinary course of business, (iii) other equity
issuances to employees, officers, directors or consultants of Parent or any
Subsidiary of Parent in the ordinary course of business and (iv) equity
issuances to holders of minority interests in Subsidiaries of the Parent to the
extent the proceeds of such equity issuance are used or are to be used for such
Subsidiary's working capital and other general business purposes.

            "ERISA" means the Employee Retirement Income Security Act of 1974,
as amended, and any successor statute thereto.

            "ERISA Affiliate" means (a) any Person subject to ERISA whose
employees are treated as employed by the same employer as the employees of
Borrower under IRC Section 414(b), (b) any trade or business subject to ERISA
whose employees are treated as employed by the same employer as the employees of
Borrower under IRC Section 414(c), (c) solely for purposes of Section 302 of
ERISA and Section 412 of the IRC, any organization subject to ERISA that is a
member of an affiliated service group of which Borrower is a member under IRC
Section 414(m), or (d) solely for purposes of Section 302 of ERISA and Section
412 of the IRC, any Person subject to ERISA that is a party to an arrangement
with Borrower and whose employees are aggregated with the employees of Borrower
under IRC Section 414(o).

            "Event of Default" has the meaning set forth in SECTION 8.

            "Exchange Act" means the Securities Exchange Act of 1934, as in
effect from time to time.

            "Existing Credit Agreement" means the Third Amended and Restated
Term Loan and Revolving Credit Agreement dated as of August 2, 2002, as amended,
restated, supplemented or otherwise modified from time to time, among FW LLC, FW
USA, FW Power, FW Energy, the guarantors signatory thereto, the lenders
signatory thereto, Bank of America, N.A., as administrative agent and collateral
agent, and Bank of America Securities LLC, as Lead Arranger and Book Manager.

                                      -12-

<PAGE>

            "Existing Credit Agreement Specified Covenants" has the meaning set
forth in Section 7.20(b)(iv).

            "Existing Credit Documents" means the Existing Credit Agreement and
the "Loan Documents", as such term is defined in the Existing Credit Agreement.

            "Existing Credit Party" means any Company party to the Existing
Credit Agreement.

            "Existing Foreign Sale-Leaseback Transactions" shall mean the
Sale-Leaseback Transactions involving Foreign Subsidiaries listed on Schedule
3.07 of the Existing Credit Agreement.

            "Existing Italian Joint Venture Entities" means Foster Wheeler
Italiana S.p.A., MF Energy s.r.l., MF Power s.r.l. and MF Waste s.r.l.

            "Fee Letter" means that certain fee letter, dated as of even date
herewith, between Borrower and Agent, in form and substance satisfactory to
Agent.

            "FEIN" means Federal Employer Identification Number.

            "Financing Lease" means (i) any lease entered into in connection
with a Sale/Leaseback Transaction, (ii) any Capitalized Lease and (iii) any
other lease in respect of which the lessee is treated as the owner of the leased
property for purposes of the IRC.

            "Foothill" means Foothill Capital Corporation, a California
corporation.

            "Foreign Subsidiary" means (i) any Subsidiary of Parent created or
organized under the laws of a jurisdiction outside the United States of America
or (ii) (A) Foster Wheeler Continental U.S., Inc. ("Foster Wheeler Continental
I"), (B) a newly-created Subsidiary of Parent ("Foster Wheeler Continental II")
formed to hold the Stock of another newly-created Subsidiary formed to hold the
energy division of Foster Wheeler Iberia, S.A. or (C) any of their respective
Subsidiaries that otherwise would constitute a Domestic Subsidiary, in the case
of any Subsidiary described in this clause (ii), so long as (x) the Person that
directly owns all of the Stock in each of Foster Wheeler Continental I and
Foster Wheeler Continental II is a Foreign Subsidiary (within the meaning of
clause (i) of this definition) and (y) such Subsidiary is a holding company
substantially all of whose assets consist of Stock in a Foreign Subsidiary
(within the meaning of clause (i) of this definition).

            "Funding Date" means the date on which a Borrowing occurs.

            "FW Constructors" means Foster Wheeler Constructors, Inc., a
Delaware corporation.

            "FW Energy" means Foster Wheeler Energy Corporation, a Delaware
corporation.

            "FW Energy Services" means Foster Wheeler Energy Services, Inc., a
California corporation.

                                      -13-

<PAGE>

            "FW LLC" means Foster Wheeler LLC, a Delaware limited liability
company.

            "FW Power" means Foster Wheeler Power Group, Inc., a Delaware
corporation.

            "FW USA" means Foster Wheeler USA Corporation, a Delaware
corporation.

            "FW Zack" means Foster Wheeler Zack, Inc., a Delaware corporation.

            "GAAP" means generally accepted accounting principles as in effect
from time to time in the United States, consistently applied, PROVIDED that, for
purposes of SECTION 7.20(B) and the defined terms used therein (the "Referenced
Provisions"), if Borrower notifies Agent that Borrower requests an amendment of
any Referenced Provision to eliminate the effect of any change occurring after
the date hereof in GAAP or in the application thereof (or if Agent notifies
Borrower that the Required Lenders request an amendment of any Referenced
Provision for such purpose), regardless of whether such notice is given before
or after such change in GAAP or in the application thereof, then such Referenced
Provision shall be applied on the basis of GAAP as in effect and applied
immediately before such change shall have become effective until such notice
shall have been withdrawn or such Referenced Provision amended in accordance
herewith.

            "General Intangibles" means all of Borrower's now owned or hereafter
acquired right, title, and interest with respect to general intangibles
(including payment intangibles, contract rights, rights to payment, rights
arising under common law, statutes, or regulations, choses or things in action,
goodwill, patents, trade names, trademarks, servicemarks, copyrights,
blueprints, drawings, purchase orders, customer lists, monies due or recoverable
from pension funds, route lists, rights to payment and other rights under any
royalty or licensing agreements, infringement claims, computer programs,
information contained on computer disks or tapes, software, literature, reports,
catalogs, money, deposit accounts, insurance premium rebates, tax refunds, and
tax refund claims), and any and all supporting obligations in respect thereof,
and any other personal property other than goods, Accounts, Investment Property,
and Negotiable Collateral.

            "Governing Documents" means, with respect to any Person, the
certificate or articles of incorporation, by-laws, or other organizational
documents of such Person.

            "Governmental Authority" means any federal, state, local, or other
governmental or administrative body, instrumentality, department, or agency or
any court, tribunal, administrative hearing body, arbitration panel, commission,
or other similar dispute-resolving panel or body.

            "Guarantor" means the Parent.

            "Guaranty" means that certain performance guaranty executed and
delivered by Guarantor in favor of Agent, for the benefit of the Lender Group,
in form and substance satisfactory to Agent.

            "Hazardous Materials" means (a) substances that are defined or
listed in, or otherwise classified pursuant to, any applicable laws or
regulations as "hazardous substances," "hazardous materials," "hazardous

                                      -14-

<PAGE>

wastes," "toxic substances," or any other formulation intended to define, list,
or classify substances by reason of deleterious properties such as ignitability,
corrosivity, reactivity, carcinogenicity, reproductive toxicity, or "EP
toxicity", (b) oil, petroleum, or petroleum derived substances, natural gas,
natural gas liquids, synthetic gas, drilling fluids, produced waters, and other
wastes associated with the exploration, development, or production of crude oil,
natural gas, or geothermal resources, (c) any flammable substances or explosives
or any radioactive materials, and (d) asbestos in any form or electrical
equipment that contains any oil or dielectric fluid containing levels of
polychlorinated biphenyls in excess of 50 parts per million.

            "Hedging Agreement" shall mean any interest rate protection
agreement, foreign currency exchange agreement, commodity price protection
agreement or other interest rate, currency exchange rate or commodity price
hedging agreement, whether or not classified as a hedge for purposes of GAAP.

            "Indebtedness" means, with respect to any Person, (a) all
obligations of such Person for borrowed money, (b) all obligations of such
Person evidenced by bonds, debentures, notes, or other similar instruments and
all reimbursement or other obligations of such Person in respect of letters of
credit, bankers acceptances, interest rate swaps, or other financial products,
(c) all obligations of such Person under Capital Leases, (d) all obligations or
liabilities of others secured by a Lien on any asset of such Person,
irrespective of whether such obligation or liability is assumed, (e) all
obligations of such Person for the deferred purchase price of assets (other than
trade debt incurred in the ordinary course of such Person's business and
repayable in accordance with customary trade practices), and (f) any obligation
of such Person guaranteeing or intended to guarantee (whether directly or
indirectly guaranteed, endorsed, co-made, discounted, or sold with recourse to
such Person) any obligation of any other Person.

            "Indemnified Liabilities" has the meaning set forth in SECTION 11.3.

            "Indemnified Person" has the meaning set forth in SECTION 11.3.

            "Indentures" means the Senior Indenture, the Subordinated Indenture
and the Trust Preferred Indenture.

            "Initial Transactions" has the meaning set forth in SECTION 3.1(Y).

            "Insolvency Proceeding" means any proceeding commenced by or against
any Person under any provision of the Bankruptcy Code or under any other state
or federal bankruptcy or insolvency law, assignments for the benefit of
creditors, formal or informal moratoria, compositions, extensions generally with
creditors, or proceedings seeking reorganization, arrangement, or other similar
relief.

            "Intangible Assets" means, with respect to any Person, that portion
of the book value of all of such Person's assets that would be treated as
intangibles under GAAP.

            "Inventory" means all Borrower's now owned or hereafter acquired
right, title, and interest with respect to inventory, including goods held for
sale or lease or to be furnished under a contract of service, goods that are

                                      -15-

<PAGE>

leased by Borrower as lessor, goods that are furnished by Borrower under a
contract of service, and raw materials, work in process, or materials used or
consumed in Borrower's business.

            "Investment" means, with respect to any Person, any investment by
such Person in any other Person (including Affiliates) in the form of loans,
guarantees, advances, or capital contributions (excluding (a) commission,
travel, and similar advances to officers and employees of such Person made in
the ordinary course of business, and (b) bona fide Accounts arising from the
sale of goods or rendition of services in the ordinary course of business
consistent with past practice), purchases or other acquisitions for
consideration of Indebtedness or Stock, and any other items that are or would be
classified as investments on a balance sheet prepared in accordance with GAAP.

            "Investment Property" means all of Borrower's now owned or hereafter
acquired right, title, and interest with respect to "investment property" as
that term is defined in the Code, and any and all supporting obligations in
respect thereof.

            "IRC" means the Internal Revenue Code of 1986, as in effect from
time to time.

            "Lender" and "Lenders" have the respective meanings set forth in the
preamble to this Agreement, and shall include any other Person made a party to
this Agreement in accordance with the provisions of SECTION 14.1.

            "Lender Group" means, individually and collectively, each of the
Lenders and Agent.

            "Lender Group Expenses" means all (a) costs or expenses (including
taxes, and insurance premiums) required to be paid by Borrower under any of the
Transaction Documents that are paid or incurred by the Lender Group, (b)
reasonable fees or charges paid or incurred by the Lender Group in connection
with the Lender Group's transactions with Borrower, including, fees or charges
for photocopying, notarization, couriers and messengers, telecommunication,
public record searches (including tax lien, judgment, and UCC searches and
including searches with the patent and trademark office, the copyright office,
or the department of motor vehicles), filing, recording, publication, appraisal
(including periodic Collateral appraisals or business valuations to the extent
of the fees and charges (and up to the amount of any limitation) contained in
this Agreement), real estate surveys, real estate title policies and
endorsements, and environmental audits, (c) costs and expenses incurred by the
Lender Group in the disbursement of funds to Borrower (by wire transfer or
otherwise), (d) charges paid or incurred by the Lender Group resulting from the
dishonor of checks, (e) reasonable costs and expenses paid or incurred by the
Lender Group to correct any default or enforce any provision of the Loan
Documents, or in gaining possession of, maintaining, handling, preserving,
storing, shipping, selling, preparing for sale, or advertising to sell the
Collateral, or any portion thereof, irrespective of whether a sale is
consummated, (f) audit fees and expenses of the Lender Group related to audit
examinations of the Books to the extent of the fees and charges (and up to the
amount of any limitation) contained in this Agreement, (g) reasonable costs and
expenses of third party claims or any other suit paid or incurred by the Lender
Group in enforcing or defending the Transaction Documents or in connection with
the transactions contemplated by the Transaction Documents or the Lender Group's
relationship with Borrower or any guarantor of the Obligations, (h) Agent's and

                                      -16-

<PAGE>

each Lender's reasonable fees and expenses (including reasonable attorneys fees)
incurred in advising, structuring, drafting, reviewing, administering, or
amending the Transaction Documents, PROVIDED that, so long as no Event of
Default shall have occurred and be continuing, Lender Group Expenses under this
clause (h) shall not include attorneys fees for more than one law firm, and (i)
Agent's and each Lender's reasonable fees and expenses (including attorneys
fees) incurred in terminating, enforcing (including attorneys fees and expenses
incurred in connection with a "workout," a "restructuring," or an Insolvency
Proceeding concerning Borrower or in exercising rights or remedies under the
Transaction Documents), or defending the Transaction Documents, irrespective of
whether suit is brought.

            "Lender-Related Person" means, with respect to any Lender, such
Lender, together with such Lender's Affiliates, and the officers, directors,
employees, and agents of such Lender.

            "Lien" means any interest in an asset securing an obligation owed
to, or a claim by, any Person other than the owner of the asset, whether such
interest shall be based on the common law, statute, or contract, whether such
interest shall be recorded or perfected, and whether such interest shall be
contingent upon the occurrence of some future event or events or the existence
of some future circumstance or circumstances, including the lien or security
interest arising from a mortgage, deed of trust, encumbrance, pledge,
hypothecation, assignment, deposit arrangement, security agreement, conditional
sale or trust receipt, or from a lease, consignment, or bailment for security
purposes and also including reservations, exceptions, encroachments, easements,
rights-of-way, covenants, conditions, restrictions, leases, and other title
exceptions and encumbrances affecting real property.

            "Loan Account" has the meaning set forth in SECTION 2.10.

            "Loan Documents" means this Agreement, the Cash Management
Agreements, the Control Agreements, the Disbursement Letter, the Fee Letter, the
Guaranty, the Officers' Certificate, any note or notes executed by Borrower in
connection with this Agreement and payable to a member of the Lender Group, and
any other agreement entered into, now or in the future, by Borrower and the
Lender Group in connection with this Agreement.

            "Major Casualty Proceeds" means (i) the aggregate insurance proceeds
received in connection with one or more related events by FW LLC or any
Subsidiary of FW LLC under any Property Insurance Policy or (ii) any award or
other cash compensation with respect to any one or more related condemnations of
property (or any transfer or disposition of property in lieu of condemnation)
received by FW LLC or any Subsidiary of FW LLC if the amount of such aggregate
insurance proceeds or award or other cash compensation exceeds $1,500,000.

            "Material Adverse Change" means (a) a material adverse change in the
business, operations, results of operations, assets, liabilities or condition
(financial or otherwise) of the Parent and Originators (taken as a whole),
Borrower or Servicer, (b) a material impairment of Borrower's, Servicer's or any
Originator's ability to perform its obligations under the Transaction Documents
to which it is a party, (c) a material impairment of the enforceability or
priority of the Agent's Liens with respect to the Collateral as a result of an

                                      -17-

<PAGE>

action or failure to act on the part of Borrower or (d) a material impairment of
the validity or enforceability of any of the Transaction Documents or the
validity, enforceability or collectibility of a material portion of the
Purchased Accounts (except as a result of the financial condition or bankruptcy
of an Account Debtor).

            "Material Contracts" means the Debt Documents and, as of any date,
the top twenty five Contracts, each between an Originator and an Account Debtor,
ranked in accordance with gross revenue generated under such agreements during
the twelve-month period ending on the last day of the month preceding such date.

            "Maturity Date" has the meaning set forth in SECTION 3.4.

            "Maximum Revolver Amount" means $40,000,000.

            "Moody's" means Moody's Investors Service, Inc. and any successor
thereto.

            "Negotiable Collateral" means all of Borrower's now owned and
hereafter acquired right, title, and interest with respect to letters of credit,
letter of credit rights, instruments, promissory notes, drafts, documents, and
chattel paper (including electronic chattel paper and tangible chattel paper),
and any and all supporting obligations in respect thereof.

            "Net Cash Proceeds" means, with respect to any Prepayment Event, an
amount equal to the cash proceeds received by FW LLC or any of its Subsidiaries
from or in respect of such Prepayment Event (including any cash proceeds
received by way of deferred payment (other than in respect of interest), but
only as and when received, less:

            (a) any fees, costs and expenses reasonably incurred by such Person
in respect of such Prepayment Event;

            (b) amounts required to be paid to holders of minority interests in
any Subsidiary as a result of such Prepayment Event;

            (c) if such Prepayment Event is an Asset Sale or receipt of Major
Casualty Proceeds, (i) any taxes (including, without limitation, income taxes,
withholding taxes and repatriation taxes) actually paid or to be paid by such
Person or, if such Person is a partnership or a limited liability company, any
such taxes that would be payable assuming the highest corporate tax rate were
applicable to such Person, as estimated by an Authorized Officer of FW LLC,
giving effect to the overall tax position of FW LLC, in respect of such
Prepayment Event, (ii) the amount of all Indebtedness (other than the
Indebtedness under the Existing Credit Agreement or under the notes issued under
the Senior Indenture) secured by any assets subject to such Prepayment Event and
subject to mandatory prepayment as a result of such Prepayment Event and (iii)
in the case of a Prepayment Event involving a Foreign Subsidiary or Special
Purpose Subsidiary, any amount not permitted to be repatriated to a borrower
under the Existing Credit Agreement at such time because of contractual or legal
restrictions binding on such Foreign Subsidiary or Special Purpose Subsidiary
until such time as such amount is no longer restricted from being repatriated
(at which time such amount shall become Net Cash Proceeds); PROVIDED that the
Parent and its Subsidiaries shall have used commercially reasonable efforts to
ensure that any such contractual restriction is not materially more restrictive
than those in effect on the date hereof;

                                      -18-

            (d) if such Prepayment Event is an Asset Sale, (i) the amount of any
reserves established by FW LLC and its Subsidiaries to fund purchase price
adjustments in respect of such Asset Sale and any reserves to fund contingent
liabilities payable by FW LLC and its Subsidiaries attributable to such Asset
Sale (as estimated by an Authorized Officer of FW LLC), including, without
limitation, liabilities under any indemnification obligations and severance and
other employee termination costs associated with such Asset Sale, until such
time as such amounts are no longer reserved or such reserve is no longer
necessary (at which time any remaining amounts will become Net Cash Proceeds),
(ii) amounts required to be paid at the closing of such Asset Sale with respect
to Indebtedness and other liabilities directly associated with the assets that
are the subject of such Asset Sale, including, without limitation, trade
payables and other accrued liabilities (to the extent not already reflected in
the amount of cash proceeds received by FW LLC or any of its Subsidiaries from
or in respect of such Prepayment Event), and (iii) in the case of an Asset Sale
with respect to the Existing Italian Joint Venture Entities (or the direct or
indirect Stock therein), up to $10,000,000 of the proceeds thereof contemplated
by the terms of such transaction to be reinvested in the Existing Italian Joint
Venture Entities and their Subsidiaries and/or in joint venture arrangements
entered into (or to be entered into) by such Persons; and

            (e) if such Prepayment Event is the receipt of Major Casualty
Proceeds, the amount of the cash proceeds applied by FW LLC or a Subsidiary
within 180 days of the receipt thereof to the restoration or replacement of the
asset (or the reinvestment in an equivalent asset to be used in the business of
the respective Person) in respect of which such Major Casualty Proceeds were
received; PROVIDED that so long as FW LLC or a Subsidiary is at the end of such
180-day period diligently proceeding with the restoration or replacement of the
asset in respect of which such Major Casualty Proceeds were received, the
180-day period shall be extended to the date that is the earlier of (A) the date
on which FW LLC or such Subsidiary (x) completes such restoration or replacement
or (y) decides not to further pursue such restoration or replacement and (B) the
540th day after receipt thereof.

            "Notice of Sole Control" means a written notice delivered by Agent
to any Cash Management Bank directing such Cash Management Bank to forward all
amounts on deposit in each Cash Management Account maintained with such Cash
Management Bank to the Agent's Account in accordance with SECTION 2.7(B)(III).

            "Obligations" means all loans, Advances, debts, principal, interest
(including any interest that, but for the provisions of the Bankruptcy Code,
would have accrued), premiums, liabilities (including all amounts charged to
Borrower's Loan Account pursuant hereto), obligations, fees (including the fees
provided for in the Fee Letter), charges, costs, Lender Group Expenses
(including any fees or expenses that, but for the provisions of the Bankruptcy
Code, would have accrued), lease payments, guaranties, covenants, and duties of
any kind and description owing by Borrower to the Lender Group pursuant to or
evidenced by the Loan Documents and irrespective of whether for the payment of
money, whether direct or indirect, absolute or contingent, due or to become due,
now existing or hereafter arising, and including all interest not paid when due
and all Lender Group Expenses that Borrower is required to pay or reimburse by
the Transaction Documents, by law, or otherwise. Any reference in this Agreement

                                      -19-

<PAGE>

or in the Transaction Documents to the Obligations shall include all amendments,
changes, extensions, modifications, renewals replacements, substitutions, and
supplements, thereto and thereof, as applicable, both prior and subsequent to
any Insolvency Proceeding.

            "Officers' Certificate" means the representations and warranties of
officers form submitted by Agent to Borrower, together with Borrower's completed
responses to the inquiries set forth therein, the form and substance of such
responses to be satisfactory to Agent.

            "Originating Lender" has the meaning set forth in SECTION 14.1(E).

            "Originators" means (i) FW Constructors, FW Energy, FW Energy
Services, FW Power, FW USA and FW Zack and (ii) each Additional Originator.

            "Overadvance" has the meaning set forth in SECTION 2.5.

            "Parent" means Foster Wheeler Ltd., a Bermuda limited company.

                     "Participant" has the meaning set forth in SECTION 14.1(E).

            "Participant Register" has the meaning set forth in SECTION 14.1(H).

            "Permitted Assets" has the meaning set forth in SECTION 5.11.

            "Permitted Discretion" means a determination made in good faith and
in the exercise of reasonable business judgment.

            "Permitted Dispositions" means the use or transfer of money or Cash
Equivalents by Borrower in a manner that is not prohibited by the terms of this
Agreement or the other Loan Documents.

            "Permitted Investments" means (a) investments in Cash Equivalents,
and (b) investments in negotiable instruments for collection.

            "Permitted Liens" means Liens held by Agent for the benefit of Agent
and the Lenders.

            "Permitted Protest" means the right of Borrower to protest taxes
(other than payroll taxes or taxes that are the subject of a United States
federal tax lien) or rental payment, provided that (a) a reserve with respect to
such obligation is established on the Books in such amount as is required under
GAAP, (b) any such protest is instituted promptly and prosecuted diligently by
Borrower in good faith, and (c) Agent is satisfied that, while any such protest
is pending, there will be no impairment of the enforceability, validity, or
priority of any of the Agent's Liens.

            "Perryville Lease Facilities" means the Perryville I Lease Facility
and the Perryville III Lease Facility.

            "Perryville I Lease Facility" means that certain Financing Lease and
any Indebtedness secured directly or indirectly by an assignment of such

                                      -20-

<PAGE>

Financing Lease of the property located at Perryville I Corporate Park, 51 Route
173 East, Union Township, New Jersey.

            "Perryville III Lease Facility" means the $37,000,000 Participation
Agreement and Loan Facility, dated as of December 16, 1994, among National
Westminster Bank PLC, the other lenders named therein and Perryville III Trust
and Master Lease, Subordinated Ground Lease and Construction Agreement between
Perryville III Trust and Foster Wheeler Corporation and any Indebtedness secured
directly or indirectly by an assignment of such Financing Lease of the property
located at Perryville III Corporate Park, 51 Route 173 East, Union Township, New
Jersey.

            "Person" means an individual, partnership, corporation (including a
business trust), joint stock company, trust, unincorporated association, joint
venture, limited liability company or other entity, or a government or any
political subdivision or agency thereof.

            "Prepayment Event" means (i) any Asset Sale (other than any Asset
Sale, the Net Cash Proceeds of which, when aggregated with the Net Cash Proceeds
of any related Asset Sale, do not exceed $1,500,000), (ii) any Debt Incurrence,
(iii) any Equity Issuance or (iv) the receipt by FW LLC or any Subsidiary of FW
LLC of Major Casualty Proceeds.

            "Project" means any municipal solid waste project or any other
project the assets of which are financed on a limited recourse basis.

            "Projections" means with respect to any Person, such Person's
forecasted (a) balance sheets, (b) profit and loss statements, and (c) cash flow
statements, all prepared on a basis consistent with such Person's historical
financial statements, together with appropriate supporting details and a
statement of underlying assumptions.

            "Property Insurance Policy" means any insurance policy maintained by
FW LLC or any of its Subsidiaries covering losses with respect to tangible real
or personal property or improvements, but excluding coverage for losses from
business interruption.

            "Pro Rata Share" means, with respect to a Lender's obligation to
make Advances, receive payments of principal, interest, fees, costs, and
expenses with respect thereto, and all other matters (including the
indemnification obligations arising under SECTION 16.7), (i) prior to the
Commitments being terminated or reduced to zero, the percentage obtained by
dividing (A) such Lender's Commitment, by (B) the aggregate amount of
Commitments of all Lenders, and (ii) from and after the time that the
Commitments have been terminated or reduced to zero, the percentage obtained by
dividing (A) the aggregate unpaid principal amount of such Lender's Advances, by
(B) the aggregate unpaid principal amount of all Advances.

            "Purchase Agreement" means the Purchase, Sale and Contribution
Agreement, dated as of the date hereof, among the Originators, Borrower and
Servicer.

                                      -21-

<PAGE>

            "Purchased Accounts" means Subject Accounts that are purchased by or
contributed to Borrower from any Originator pursuant to the Purchase Agreement.

            "Record" means information that is inscribed on a tangible medium or
which is stored in an electronic or other medium and is retrievable in
perceivable form.

            "Register" has the meaning set forth in SECTION 14.1(H).

            "Related Fund" means, with respect to any Lender, a fund or account
managed by such Lender or an Affiliate of such Lender or its investment manager.

            "Report" has the meaning set forth in SECTION 16.17.

            "Required Lenders" means, at any time, Lenders whose Pro Rata Shares
aggregate 51% of the Commitments, or if the Commitments have been terminated
irrevocably, 51% of the Obligations then outstanding.

            "Revolver Usage" means, as of any date of determination, the then
extant amount of outstanding Advances.

            "Robbins Debt Documents" means the Exit Funding Agreement and each
other agreement or instrument relating to the Robbins Obligations as currently
in effect.

            "Robbins Obligations" means, collectively, (a) FW LLC's obligations
under the $20,350,000 4.9% 1997 Construction (Equity) Bonds and (b) the
subordinated obligations under the Exit Funding Agreement relating to the
$95,000,000 7.25% 1999 Series C Term Bonds and the $18,000,000 7.0% 1999 Series
D Accretion Bonds.

            "S&P" means Standard & Poor's Ratings Services, a division of The
McGraw-Hill Companies, Inc. and any successor thereto.

            "Sale/Leaseback Transaction" means any arrangement whereby FW LLC or
any of its Subsidiaries shall sell or transfer any property, real or personal,
used or useful in its business, whether now owned or hereafter acquired, and
thereafter rent or lease property that it intends to use for substantially the
same purpose or purposes as the property sold or transferred. For purposes of
calculating "Senior Debt", the "principal amount" of any obligations of any
Person under any leases entered into in connection with a Sale/Leaseback
Transaction shall be determined as set forth in Schedule S-1.

            "SEC" means the United States Securities and Exchange Commission and
any successor thereto.

            "Securities Account" means a "securities account" as that term is
defined in the Code.

            "Securitization Transaction" means the Transactions or any other
transaction in which FW LLC or any of its Subsidiaries sells or otherwise
transfers or pledges accounts receivable and related assets (a) to one or more
third party purchasers or lenders or (b) to a special purpose entity that
borrows against such accounts receivable or sells or pledges such accounts
receivable and related assets to one or more third party purchasers or lenders.

                                      -22-

<PAGE>

            "Senior Debt" shall mean the total principal amount of Indebtedness
of FW LLC and its consolidated Subsidiaries, determined on a consolidated basis,
excluding (a) the Convertible Subordinated Notes, (b) the subordinated portion
of the Robbins Obligations, (c) the Trust Preferred, (d) all Hedging Agreements,
(e) all Indebtedness to the extent of any cash collateral deposited to secure
such Indebtedness, (f) any other Subordinated Indebtedness and (g) the Existing
Foreign Sale/Leaseback Transactions (and any replacements, renewals or
refinancings thereof).

            "Senior Debt Ratio" shall mean, at any date, the ratio of (i) Senior
Debt at such date to (ii) Consolidated Adjusted EBITDA for the period of four
fiscal quarters most recently ended on or prior to such date.

            "Senior Indenture" means the Indenture, dated as of November 5,
1995, as amended, restated, supplemented or otherwise modified from time to
time, among FW LLC, FW USA, FW Power, FW Energy, Foster Wheeler Inc., Foster
Wheeler International Holdings, and the Senior Indenture Trustee regarding FW
LLC's 6 3/4% Notes due November 15, 2005.

            "Senior Indenture Trustee" means BNY Midwest Trust Company or any
successor trustee appointed under the Senior Indenture.

            "Servicer" means Foster Wheeler Capital & Finance Corporation, a
Delaware corporation.

            "Servicing Agreement" means the Servicing Agreement, dated as of the
date hereof, among Servicer, Borrower, the Originators and Agent.

            "Servicing Fee" has the meaning set forth in SECTION 6.6(F).

            "Settlement" has the meaning set forth in SECTION 2.3(F)(I).

            "Settlement Date" has the meaning set forth in SECTION 2.3(F)(I).

            "Single Originator Default" means (i) (A) any Event of Default
arising under SECTIONS 8.6, 8.8 or 8.15 or (B) any Material Adverse Change, in
each case, that is caused by the actions or failure to act of a Single
Originator or that is caused by events affecting only a Single Originator or
(ii) the failure of a Single Originator to be Solvent.

            "Solvent" has the meaning set forth in the Purchase Agreement.

            "Special Purpose Subsidiary" means (a) a Subsidiary of FW LLC formed
with the express and sole purpose of, and which is engaged solely in the
business of, constructing or owning, leasing or operating a specific Project,
and with respect to which Subsidiary, neither FW LLC nor any of its other
Subsidiaries is obligated (except as guarantor of completion or performance) to
pay any Indebtedness (including lease obligations) incurred to construct, own,
lease or operate any such Project or any other Indebtedness of such Subsidiary,
under the Exit Funding Agreement, so long as such companies otherwise qualify
under this definition or (b) a Domestic Subsidiary formed with the express and

                                      -23-

<PAGE>

sole purpose of, and which is engaged solely in the business of, acting as a
bankruptcy-remote conduit in connection with a Securitization Transaction.

            "Specified Financial Covenants" means the financial covenants set
forth in Section 7.20(b).

            "Specified Provisions" has the meaning set forth in Section
7.20(b)(iv).

            "Stock" means all shares, options, warrants, interests,
participations, or other equivalents (regardless of how designated) of or in a
Person, whether voting or nonvoting, including common stock, preferred stock, or
any other "equity security" (as such term is defined in Rule 3a11-1 of the
General Rules and Regulations promulgated by the SEC under the Exchange Act).

            "Subject Accounts" means any right to receive payment, whether
constituting an "account", "chattel paper", "instrument" or "general intangible"
(as each such term is defined in the Code), and any and all supporting
obligations in respect thereof, that are created by any Originator, and that
arise out of such Originator's sale of goods or rendition of services, and any
and all supporting obligations in respect thereof.

            "Subordinated Indebtedness" shall mean the Convertible Subordinated
Notes, the subordinated portion of the Robbins Obligations and Indebtedness
incurred pursuant to Section 6.03(k) of the Existing Credit Agreement.

            "Subordinated Indenture" means the Indenture, dated as of May 31,
2001, as amended, restated, supplemented or otherwise modified from time to
time, among Parent, FW LLC and the Subordinated Indenture Trustee regarding
Parent's 6.50% Convertible Subordinated Notes due 2007.

            "Subordinated Indenture Trustee" means BNY Midwest Trust Company or
any successor trustee appointed under the Subordinated Indenture.

            "Subordinated Notes" means the Subordinated Promissory Notes, each
dated the date hereof, made by Borrower in favor of the Originators, which
Subordinated Promissory Notes shall be subordinate to the Obligations on terms
satisfactory to the Lenders.

            "Subsidiary" of a Person means a corporation, partnership, limited
liability company, or other entity in which that Person directly or indirectly
owns or controls the shares of Stock having ordinary voting power to elect a
majority of the board of directors (or appoint other comparable managers) of
such corporation, partnership, limited liability company, or other entity.

            "Swing Lender" means Foothill or any other Lender that, at
the request of Borrower and with the consent of Agent agrees, in such Lender's
sole
discretion, to become the Swing Lender hereunder.

            "Swing Loan" has the meaning set forth in SECTION 2.3(D)(I).

                                      -24-

<PAGE>

            "Tangible Net Worth" means, as of any date of determination, the
result of (a) Borrower's total stockholder's equity, minus (b) the sum of (i)
all Intangible Assets of Borrower, (ii) all of Borrower's prepaid expenses, and
(iii) all amounts due to Borrower from Affiliates.

            "Taxes" has the meaning set forth in SECTION 16.11.

            "Temporary Cash Investment" means any Investment in (a) securities
issued or directly and fully guaranteed or insured by the United States of
America government or any agency or instrumentality thereof having maturities of
not more than one year from the date of acquisition, (b) marketable direct
obligations issued by any State of the United States or any political
subdivision of any such State or any public instrumentality thereof maturing
within one year from the date of acquisition thereof and, at the time of
acquisition, having one of the two highest ratings obtainable from either S&P or
Moody's, (c) demand deposits, time deposits and certificates of deposits with
maturities of one year or less from the date of acquisition, bankers'
acceptances with maturities not exceeding one year from the date of acquisition
and overnight bank deposits, in each case with any bank or trust company
organized or licensed under the laws of the United States of America or any
State thereof having capital, surplus and undivided profits in excess of $250
million, (d) repurchase obligations with a term of not more than seven days for
underlying securities of the type described in clauses (a), (b) and (c) above
entered into with any financial institution meeting the qualifications specified
in clause (c) above, (e) commercial paper rated at least P-1 by Moody's and A-1
by S&P at the time of acquisition thereof or, if such commercial paper is rated
by only one such agency, at least such rating from such agency, (f) investments
in any Dollar denominated money market fund as defined by Rule 2a-7 of the
General Rules and Regulations promulgated under the Investment Company Act of
1940 and (g) in the case of a Foreign Subsidiary, substantially similar
investments denominated in foreign currencies (including similarly capitalized
foreign banks).

            "Testing Period" means, with respect to any week, the eight-week
period ending at the end of such week, PROVIDED that, if any such eight-week
period encompasses an entire fiscal month consisting of five weeks, then such
Testing Period shall be expanded to the nine-week period ending at the end of
such week.

            "Transaction Documents" means the Loan Documents, the Servicing
Agreement, the Purchase Agreement and the Subordinated Note.

            "Transactions" means the Initial Transactions and the purchase by
Borrower of Subject Accounts, or the acceptance by Borrower of the contribution
thereof, from the Originators from time to time pursuant to the Purchase
Agreement.

            "Trust Preferred" means the 9% $175,000,000 Trust Preferred
Securities of FW LLC (as successor to Foster Wheeler Corporation) issued on or
about January 13, 1999, and the related junior subordinated debentures.

            "Trust Preferred Indenture" means, collectively, the Indenture and
the First Supplemental Indenture, each dated January 13, 1999, as amended,

                                      -25-

<PAGE>

restated, supplemented or otherwise modified from time to time, between FW LLC
and the Trust Preferred Indenture Trustee regarding the Trust Preferred.

            "Trust Preferred Indenture Trustee" means Harris Trust and Savings
Bank or any successor trustee appointed under the Trust Preferred Indenture.

            "Voidable Transfer" has the meaning set forth in SECTION 17.7.

            "Wells Fargo" means Wells Fargo Bank, National Association, a
national banking association.

            1.2 ACCOUNTING TERMS. All accounting terms not specifically defined
herein shall be construed in accordance with GAAP. When used herein, the term
"financial statements" shall include the notes and schedules thereto.

            1.3 CODE. Any terms used in this Agreement that are defined in the
Code shall be construed and defined as set forth in the Code unless otherwise
defined herein.

            1.4 CONSTRUCTION. Unless the context of this Agreement or any other
Loan Document clearly requires otherwise, references to the plural include the
singular, references to the singular include the plural, the term "including" is
not limiting, and the term "or" has, except where otherwise indicated, the
inclusive meaning represented by the phrase "and/or." The words "hereof,"
"herein," "hereby," "hereunder," and similar terms in this Agreement or any
other Loan Document refer to this Agreement or such other Loan Document, as the
case may be, as a whole and not to any particular provision of this Agreement or
such other Loan Document, as the case may be. Section, subsection, clause,
schedule, and exhibit references herein are to this Agreement unless otherwise
specified. Any reference in this Agreement or in the other Loan Documents to any
agreement, instrument, or document shall include all alterations, amendments,
changes, extensions, modifications, renewals, replacements, substitutions,
joinders, and supplements, thereto and thereof, as applicable (subject to any
restrictions on such alterations, amendments, changes, extensions,
modifications, renewals, replacements, substitutions, joinders, and supplements
set forth herein). Any reference herein to any Person shall be construed to
include such Person's successors and assigns. Any requirement of a writing
contained herein or in the other Loan Documents shall be satisfied by the
transmission of a Record and any Record transmitted shall constitute a
representation and warranty as to the accuracy and completeness of the
information contained therein.

            1.5 SCHEDULES AND EXHIBITS. All of the schedules and exhibits
attached to this Agreement shall be deemed incorporated herein by reference.

         2. LOAN AND TERMS OF PAYMENT.

            2.1 REVOLVER ADVANCES.

            (a) Subject to the terms and conditions of this Agreement, and
during the term of this Agreement, each Lender with a Commitment agrees
(severally, not jointly or jointly and severally) to make advances ("ADVANCES")
to Borrower in an amount at any one time outstanding not to exceed such Lender's
Pro Rata Share of an amount equal to THE LESSER OF (i) the Maximum Revolver

                                      -26-

<PAGE>

Amount, or (ii) the Borrowing Base. For purposes of this Agreement, "BORROWING
BASE," as of any date of determination, shall mean the result of:

             (x)       THE LESSER OF

                       (i)       85% of the amount of Eligible Accounts,
                        LESS the amount, if any, of the Dilution Reserve, and

                       (ii)      an amount equal to Borrower's Collections with\
                       respect to Accounts for the immediately preceding 30
                       day period, MINUS

             (y)       the aggregate amount of reserves, if any, established by
                       Agent under SECTION 2.1(B).

            (b) Anything to the contrary in this SECTION 2.1 notwithstanding,
Agent shall have the right to establish reserves in such amounts, and with
respect to such matters, as Agent in its Permitted Discretion shall deem
necessary or appropriate, against the Borrowing Base, including reserves with
respect to (i) sums that Borrower is required to pay (such as taxes and
assessments) and has failed to pay under any Section of this Agreement or any
other Loan Document, and (ii) amounts owing by Borrower to any Person to the
extent secured by a Lien on, or trust over, any of the Collateral, which Lien or
trust, in the Permitted Discretion of Agent likely would have a priority
superior to the Agent's Liens (such as Liens or trusts in favor of landlords,
carriers, mechanics, materialmen, laborers, or suppliers, or Liens or trusts for
AD VALOREM, excise, sales, or other taxes where given priority under applicable
law) in and to such item of the Collateral.

            (c) The Lenders with Commitments shall have no obligation to make
additional Advances hereunder to the extent such additional Advances would cause
the Revolver Usage to exceed the Maximum Revolver Amount.

            (d) Amounts borrowed pursuant to this Section may be repaid (without
premium or penalty except as provided in SECTION 3.6) and, subject to the terms
and conditions of this Agreement, reborrowed at any time during the term of this
Agreement.

            2.2 [INTENTIONALLY OMITTED].

            2.3 BORROWING PROCEDURES AND SETTLEMENTS.

            (a) PROCEDURE FOR BORROWING. Each Borrowing shall be made by an
irrevocable written request by an Authorized Person delivered to Agent (which
notice must be received by Agent no later than 10:00 a.m. (California time) on
the Business Day prior to the date that is the requested Funding Date specifying
(i) the amount of such Borrowing, and (ii) the requested Funding Date, which
shall be a Business Day; PROVIDED, HOWEVER, that in the case of a request for
Swing Loan in an amount of $5,000,000, or less, such notice will be timely
received if it is received by Agent no later than 10:00 a.m. (California time)
on the Business Day that is the requested Funding Date) specifying (i) the
amount of such Borrowing, and (ii) the requested Funding Date, which shall be a
Business Day. At Agent's election, in lieu of delivering the above-described

                                      -27-

<PAGE>

written request, any Authorized Person may give Agent telephonic notice of such
request by the required time, with such telephonic notice to be confirmed in
writing within 24 hours of the giving of such notice.

            (b) AGENT'S ELECTION. Promptly after receipt of a request for a
Borrowing pursuant to SECTION 2.3(A), Agent shall elect, in its discretion, (i)
to have the terms of SECTION 2.3(C) apply to such requested Borrowing, or (ii)
to request Swing Lender to make a Swing Loan pursuant to the terms of SECTION
2.3(D) in the amount of the requested Borrowing; PROVIDED, HOWEVER, that if
Swing Lender declines in its sole discretion to make a Swing Loan pursuant to
SECTION 2.3(D), Agent shall elect to have the terms of SECTION 2.3(C) apply to
such requested Borrowing.

            (c) MAKING OF ADVANCES.

                 (i) In the event that Agent shall elect to have the terms of
            this SECTION 2.3(C) apply to a requested Borrowing as described in
            SECTION 2.3(B), then promptly after receipt of a request for a
            Borrowing pursuant to SECTION 2.3(A), Agent shall notify the
            Lenders, not later than 1:00 p.m. (California time) on the Business
            Day immediately preceding the Funding Date applicable thereto, by
            telecopy, telephone, or other similar form of transmission, of the
            requested Borrowing. Each Lender shall make the amount of such
            Lender's Pro Rata Share of the requested Borrowing available to
            Agent in immediately available funds, to Agent's Account, not later
            than 10:00 a.m. (California time) on the Funding Date applicable
            thereto. After Agent's receipt of the proceeds of such Advances,
            upon satisfaction of the applicable conditions precedent set forth
            in SECTION 3 hereof, Agent shall make the proceeds thereof available
            to Borrower on the applicable Funding Date by transferring
            immediately available funds equal to such proceeds received by Agent
            to Borrower's Designated Account; PROVIDED, HOWEVER, that, subject
            to the provisions of SECTION 2.3(I), Agent shall not request any
            Lender to make, and no Lender shall have the obligation to make, any
            Advance if Agent shall have actual knowledge that (1) one or more of
            the applicable conditions precedent set forth in SECTION 3
            will not be satisfied on the requested Funding Date for the
            applicable Borrowing unless such condition has been waived, or (2)
            the requested Borrowing would exceed the Availability on such
            Funding Date.

                 (ii) Unless Agent receives notice from a Lender on or prior to
            the Closing Date or, with respect to any Borrowing after the Closing
            Date, at least one (1) Business Day prior to the date of such
            Borrowing, that such Lender will not make available as and when
            required hereunder to Agent for the account of Borrower the amount
            of that Lender's Pro Rata Share of the Borrowing, Agent may assume
            that each Lender has made or will make such amount available to
            Agent in immediately available funds on the Funding Date and Agent
            may (but shall not be so required), in reliance upon such
            assumption, make available to Borrower on such date a corresponding
            amount. If and to the extent any Lender shall not have made its full
            amount available to Agent in immediately available funds and Agent
            in such circumstances has made available to Borrower such amount,
            that Lender shall on the Business Day following such Funding Date
            make such amount available to Agent, together with interest at the
            Defaulting Lender Rate for each day during such period. A notice
            submitted by Agent to any Lender

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<PAGE>

            with respect to amounts owing under this subsection shall be
            conclusive, absent manifest error. If such amount is so made
            available, such payment to Agent shall constitute such Lender's
            Advance on the date of Borrowing for all purposes of this Agreement.
            If such amount is not made available to Agent on the Business Day
            following the Funding Date, Agent will notify Borrower of such
            failure to fund and, upon demand by Agent, Borrower shall pay such
            amount to Agent for Agent's account, together with interest thereon
            for each day elapsed since the date of such Borrowing, at a rate per
            annum equal to the interest rate applicable at the time to the
            Advances composing such Borrowing. The failure of any Lender to make
            any Advance on any Funding Date shall not relieve any other Lender
            of any obligation hereunder to make an Advance on such Funding Date,
            but no Lender shall be responsible for the failure of any other
            Lender to make the Advance to be made by such other Lender on any
            Funding Date.

                 (iii) Agent shall not be obligated to transfer to a Defaulting
            Lender any payments made by Borrower to Agent for the Defaulting
            Lender's benefit, and, in the absence of such transfer to the
            Defaulting Lender, Agent shall transfer any such payments to each
            other non-Defaulting Lender member of the Lender Group ratably in
            accordance with their Commitments (but only to the extent that such
            Defaulting Lender's Advance was funded by the other members of the
            Lender Group) or, if so directed by Borrower and if no Default or
            Event of Default had occurred and is continuing (and to the extent
            such Defaulting Lender's Advance was not funded by the Lender
            Group), retain same to be re-advanced to Borrower as if such
            Defaulting Lender had made Advances to Borrower. Subject to the
            foregoing, Agent may hold and, in its Permitted Discretion, re-lend
            to Borrower for the account of such Defaulting Lender the amount of
            all such payments received and retained by it for the account of
            such Defaulting Lender. Solely for the purposes of voting or
            consenting to matters with respect to the Loan Documents, such
            Defaulting Lender shall be deemed not to be a "Lender" and such
            Lender's Commitment shall be deemed to be zero. This Section shall
            remain effective with respect to such Lender until (x) the
            Obligations under this Agreement shall have been declared or shall
            have become immediately due and payable, (y) the non-Defaulting
            Lenders, Agent, and Borrower shall have waived such Defaulting
            Lender's default in writing, or (z) the Defaulting Lender makes its
            Pro Rata Share of the applicable Advance and pays to Agent all
            amounts owing by Defaulting Lender in respect thereof. The operation
            of this Section shall not be construed to increase or otherwise
            affect the Commitment of any Lender, to relieve or excuse the
            performance by such Defaulting Lender or any other Lender of its
            duties and obligations hereunder, or to relieve or excuse the
            performance by Borrower of its duties and obligations hereunder to
            Agent or to the Lenders other than such Defaulting Lender. Any such
            failure to fund by any Defaulting Lender shall constitute a material
            breach by such Defaulting Lender of this Agreement and shall entitle
            Borrower at its option, upon written notice to Agent, to arrange for
            a substitute Lender to assume the Commitment of such Defaulting
            Lender, such substitute Lender to be acceptable to Agent. In
            connection with the arrangement of such a substitute Lender, the
            Defaulting Lender shall have no right to refuse to be replaced
            hereunder, and agrees to execute and deliver a completed form of
            Assignment and Acceptance Agreement in favor of the substitute
            Lender (and agrees that it shall be deemed to have executed and
            delivered such document if it fails to do so) subject only to being

                                      -29-

<PAGE>

            repaid its share of the outstanding Obligations without any premium
            or penalty of any kind whatsoever; PROVIDED FURTHER, HOWEVER, that
            any such assumption of the Commitment of such Defaulting Lender
            shall not be deemed to constitute a waiver of any of the Lender
            Groups' or Borrower's rights or remedies against any such Defaulting
            Lender arising out of or in relation to such failure to fund.

               (d) MAKING OF SWING LOANS.

                 (i) In the event Agent shall elect, with the consent of Swing
            Lender, as a Lender, to have the terms of this SECTION 2.3(D) apply
            to a requested Borrowing as described in SECTION 2.3(B), Swing
            Lender as a Lender shall make such Advance in the amount of such
            Borrowing (any such Advance made solely by Swing Lender as a Lender
            pursuant to this SECTION 2.3(D) being referred to as a "SWING LOAN"
            and such Advances being referred to collectively as "SWING LOANS")
            available to Borrower on the Funding Date applicable thereto by
            transferring immediately available funds to Borrower's Designated
            Account. Each Swing Loan is an Advance hereunder and shall be
            subject to all the terms and conditions applicable to other
            Advances, except that all payments on any Swing Loan shall be
            payable to Swing Lender as a Lender solely for its own account (and
            for the account of the holder of any participation interest with
            respect to such Swing Loan). Subject to the provisions of SECTION
            2.3(I), Agent shall not request Swing Lender as a Lender to make,
            and Swing Lender as a Lender shall not make, any Swing Loan if Agent
            has actual knowledge that (i) one or more of the applicable
            conditions precedent set forth in SECTION 3 will not be satisfied on
            the requested Funding Date for the applicable Borrowing unless such
            condition has been waived, or (ii) the requested Borrowing would
            exceed the Availability on such Funding Date. Swing Lender as a
            Lender shall not otherwise be required to determine whether the
            applicable conditions precedent set forth in SECTION 3 have been
            satisfied on the Funding Date applicable thereto prior to making, in
            its sole discretion, any Swing Loan.

                 (ii) The Swing Loans shall be secured by the Agent's Liens,
            shall constitute Advances and Obligations hereunder, and shall bear
            interest at the rate applicable from time to time to Advances.

               (e) AGENT ADVANCES.

                 (i) Agent hereby is authorized by Borrower and the Lenders,
            from time to time in Agent's sole discretion, (1) after the
            occurrence and during the continuance of a Default or an Event of
            Default, or (2) at any time that any of the other applicable
            conditions precedent set forth in SECTION 3 have not been satisfied,
            to make Advances to Borrower on behalf of the Lenders that Agent, in
            its Permitted Discretion deems necessary or desirable (A) to
            preserve or protect the Collateral, or any portion thereof, (B) to
            enhance the likelihood of repayment of the Obligations, or (C) to
            pay any other amount chargeable to Borrower pursuant to the terms of
            this Agreement, including Lender Group Expenses and the costs, fees,
            and expenses described in SECTION 10 (any of the Advances described
            in this SECTION 2.3(E) shall be referred to as "Agent Advances"),
            PROVIDED, that notwithstanding anything to the contrary contained in
            this SECTION 2.3(E), the aggregate principal amount of Advances
            outstanding at any time, when taken together with the aggregate
            principal amount of Overadvances made in accordance with SECTION
            2.3(I) outstanding at any time, shall not exceed an amount equal to

                                      -30-

<PAGE>

            the lesser of (x) 10% of the Borrowing Base then in effect and (y)
            $4,000,000. Each Agent Advance is an Advance hereunder and shall be
            subject to all the terms and conditions applicable to other
            Advances, except that all payments thereon shall be payable to Agent
            solely for its own account (and for the account of the holder of any
            participation interest with respect to such Agent Advance).

                      (ii) The Agent Advances shall be repayable by Borrower on
            demand and secured by the Agent's Liens granted to Agent under the
            Loan Documents, shall constitute Advances and Obligations hereunder,
            and shall bear interest at the rate applicable from time to time to
            Advances.

                 (f) SETTLEMENT. It is agreed that each Lender's funded portion
            of the Advances is intended by the Lenders to equal, at all times,
            such Lender's Pro Rata Share of the outstanding Advances. Such
            agreement notwithstanding, Agent, Swing Lender, and the other
            Lenders agree (which agreement shall not be for the benefit of or
            enforceable by Borrower) that in order to facilitate the
            administration of this Agreement and the other Loan Documents,
            settlement among them as to the Advances, the Swing Loans, and the
            Agent Advances shall take place on a periodic basis in accordance
            with the following provisions:

                   (i) Agent shall request settlement ("SETTLEMENT") with the
            Lenders on a weekly basis, or on a more frequent basis if so
            determined by Agent, (1) on behalf of Swing Lender, with respect to
            each outstanding Swing Loan, (2) for itself, with respect to each
            Agent Advance, and (3) with respect to Collections received, as to
            each by notifying the Lenders by telecopy, telephone, or other
            similar form of transmission, of such requested Settlement, no later
            than 2:00 p.m. (California time) on the Business Day immediately
            prior to the date of such requested Settlement (the date of such
            requested Settlement being the "SETTLEMENT DATE"). Such notice of a
            Settlement Date shall include a summary statement of the amount of
            outstanding Advances, Swing Loans, and Agent Advances for the period
            since the prior Settlement Date. Subject to the terms and conditions
            contained herein (including SECTION 2.3(C)(III)): (y) if a Lender's
            balance of the Advances, Swing Loans, and Agent Advances exceeds
            such Lender's Pro Rata Share of the Advances, Swing Loans, and Agent
            Advances as of a Settlement Date, then Agent shall, by no later than
            12:00 p.m. (California time) on the Settlement Date, transfer in
            immediately available funds to the account of such Lender as such
            Lender may designate, an amount such that each such Lender shall,
            upon receipt of such amount, have as of the Settlement Date, its Pro
            Rata Share of the Advances, Swing Loans, and Agent Advances, and (z)
            if a Lender's balance of the Advances, Swing Loans, and Agent
            Advances is less than such Lender's Pro Rata Share of the Advances,
            Swing Loans, and Agent Advances as of a Settlement Date, such Lender
            shall no later than 12:00 p.m. (California time) on the Settlement
            Date transfer in immediately available funds to the Agent's Account,
            an amount such that each such Lender shall, upon transfer of such
            amount, have as of the Settlement Date, its Pro Rata Share of the
            Advances, Swing Loans, and Agent Advances. Such amounts made
            available to Agent under clause (z) of the immediately preceding
            sentence shall be applied against the amounts of the applicable
            Swing Loan or Agent Advance and, together with the portion of such
            Swing Loan or Agent Advance representing Swing Lender's Pro Rata
            Share thereof, shall constitute Advances of such Lenders. If any
            such amount is not made available to Agent by any Lender on the

                                      -31-

<PAGE>

            Settlement Date applicable thereto to the extent required by the
            terms hereof, Agent shall be entitled to recover for its account
            such amount on demand from such Lender together with interest
            thereon at the Defaulting Lender Rate.

                 (ii) In determining whether a Lender's balance of the Advances,
            Swing Loans, and Agent Advances is less than, equal to, or greater
            than such Lender's Pro Rata Share of the Advances, Swing Loans, and
            Agent Advances as of a Settlement Date, Agent shall, as part of the
            relevant Settlement, apply to such balance the portion of payments
            actually received in good funds by Agent with respect to principal,
            interest, and fees payable by Borrower and allocable to the Lenders
            hereunder, and proceeds of Collateral. To the extent that a net
            amount is owed to any such Lender after such application, such net
            amount shall be distributed by Agent to that Lender as part of such
            next Settlement.

                 (iii) Between Settlement Dates, Agent, to the extent no Agent
            Advances or Swing Loans are outstanding, may pay over to Swing
            Lender any payments received by Agent, that in accordance with the
            terms of this Agreement would be applied to the reduction of the
            Advances, for application to Swing Lender's Pro Rata Share of the
            Advances. If, as of any Settlement Date, Collections received since
            the then immediately preceding Settlement Date have been applied to
            Swing Lender's Pro Rata Share of the Advances other than to Swing
            Loans, as provided for in the previous sentence, Swing Lender shall
            pay to Agent for the accounts of the Lenders, and Agent shall pay to
            the Lenders, to be applied to the outstanding Advances of such
            Lenders, an amount such that each Lender shall, upon receipt of such
            amount, have, as of such Settlement Date, its Pro Rata Share of the
            Advances. During the period between Settlement Dates, Swing Lender
            with respect to Swing Loans, Agent with respect to Agent Advances,
            and each Lender (subject to the effect of letter agreements between
            Agent and individual Lenders) with respect to the Advances other
            than Swing Loans and Agent Advances, shall be entitled to interest
            at the applicable rate or rates payable under this Agreement on the
            daily amount of funds employed by Swing Lender, Agent, or the
            Lenders, as applicable.

                 (g) NOTATION. Agent shall record on its books the principal
            amount of the Advances owing to each Lender, including the Swing
            Loans owing to Swing Lender, and Agent Advances owing to Agent, and
            the interests therein of each Lender, from time to time. In
            addition, each Lender is authorized, at such Lender's option, to
            note the date and amount of each payment or prepayment of principal
            of such Lender's Advances in its books and records, including
            computer records, such books and records constituting conclusive
            evidence, absent manifest error, of the accuracy of the information
            contained therein.

                 (h) LENDERS' FAILURE TO PERFORM. All Advances (other than Swing
            Loans and Agent Advances) shall be made by the Lenders
            contemporaneously and in accordance with their Pro Rata Shares. It
            is understood that (i) no Lender shall be responsible for any
            failure by any other Lender to perform its obligation to make any
            Advance (or other extension of credit) hereunder, nor shall any

                                      -32-

<PAGE>

            Commitment of any Lender be increased or decreased as a result of
            any failure by any other Lender to perform its obligations
            hereunder, and (ii) no failure by any Lender to perform its
            obligations hereunder shall excuse any other Lender from its
            obligations hereunder.

                 (i) OPTIONAL OVERADVANCES.

                 (i) Any contrary provision of this Agreement (including SECTION
            2.3(I)(II)) notwithstanding, the Lenders hereby authorize Agent or
            Swing Lender, as applicable, and Agent or Swing Lender, as
            applicable, may, but is not obligated to, knowingly and
            intentionally, continue to make Advances (including Swing Loans) to
            Borrower notwithstanding that an Overadvance exists or thereby would
            be created, so long as (A) after giving effect to such Advances
            (including a Swing Loan), the outstanding Revolver Usage does not
            exceed the Borrowing Base by more than an amount equal to the lesser
            of (x) 10% of the Borrowing Base then in effect and (y) $4,000,000,
            (B) after giving effect to such Advances (including a Swing Loan),
            the outstanding Revolver Usage (except for and excluding amounts
            charged to the Loan Account for interest, fees, or Lender Group
            Expenses) does not exceed the Maximum Revolver Amount, (C) the
            aggregate principal amount of Overadvances made pursuant to this
            SECTION 2.3(I), when taken together with the aggregate principal
            amount of Agent Advances made pursuant to SECTION 2.3(E), does not
            exceed at any time an amount equal to the lesser of (x) 10% of the
            Borrowing Base then in effect and (y) $4,000,000 and (D) at the time
            of the making of any such Advance (including any Swing Loan), Agent
            does not believe, in good faith, that the Overadvance created by
            such Advance will be outstanding for more than 90 days. The
            foregoing provisions are for the exclusive benefit of Agent, Swing
            Lender, and the Lenders and are not intended to benefit Borrower in
            any way. The Advances and Swing Loans, as applicable, that are made
            pursuant to this SECTION 2.3(I) shall be subject to the same terms
            and conditions as any other Advance or Swing Loan, as applicable,
            except that the rate of interest applicable thereto shall be the
            rate applicable to Advances under SECTION 2.6(C) hereof without
            regard to the presence or absence of a Default or Event of Default.

                 (ii) In the event Agent obtains actual knowledge that the
            Revolver Usage exceeds the amounts permitted by the preceding
            paragraph, regardless of the amount of, or reason for, such excess,
            Agent shall notify Lenders as soon as practicable (and prior to
            making any (or any additional) intentional Overadvances (except for
            and excluding amounts charged to the Loan Account for interest,
            fees, or Lender Group Expenses) unless Agent determines that prior
            notice would result in imminent harm to the Collateral or its
            value), and the Lenders with Commitments thereupon shall, together
            with Agent, jointly determine the terms of arrangements that shall
            be implemented with Borrower intended to reduce, within a reasonable
            time, the outstanding principal amount of the Advances to Borrower
            to an amount permitted by the preceding paragraph. In the event
            Agent or any Lender disagrees over the terms of reduction or
            repayment of any Overadvance, the terms of reduction or repayment
            thereof shall be implemented according to the determination of the
            Required Lenders.

                 (iii) Each Lender with a Commitment shall be obligated to
            settle with Agent as provided in Section 2.3(f) for the amount of
            such Lender's Pro Rata Share of any unintentional Overadvances by
            Agent reported to such Lender, any intentional Overadvances made as
            permitted under this Section 2.3(i), and any Overadvances resulting

                                      -33-

<PAGE>

            from the charging to the Loan Account of interest, fees, or Lender
            Group Expenses.

                 2.4 PAYMENTS.

                 (a) PAYMENTS BY BORROWER.

                 (i) Except as otherwise expressly provided herein, all payments
            by Borrower shall be made to Agent's Account for the account of the
            Lender Group and shall be made in immediately available funds, no
            later than 11:00 a.m. (California time) on the date when due. Any
            payment received by Agent later than 11:00 a.m. (California time)
            shall be deemed to have been received on the following Business Day
            and any applicable interest or fee shall continue to accrue until
            such following Business Day.

                 (ii) Unless Agent receives notice from Borrower prior to the
            date on which any payment is due to the Lenders that Borrower will
            not make such payment in full as and when required, Agent may assume
            that Borrower has made (or will make) such payment in full to Agent
            on such date in immediately available funds and Agent may (but shall
            not be so required), in reliance upon such assumption, distribute to
            each Lender on such due date an amount equal to the amount then due
            such Lender. If and to the extent Borrower does not make such
            payment in full to Agent on the date when due, each Lender severally
            shall repay to Agent on demand such amount distributed to such
            Lender, together with interest thereon at the Defaulting Lender Rate
            for each day from the date such amount is distributed to such Lender
            until the date repaid.

                 (b) APPORTIONMENT AND APPLICATION OF PAYMENTS.

                 (i) Except as otherwise provided with respect to Defaulting
            Lenders and except as otherwise provided in the Loan Documents
            (including letter agreements between Agent and individual Lenders),
            aggregate principal and interest payments shall be apportioned
            ratably among the Lenders (according to the unpaid principal balance
            of the Obligations to which such payments relate held by each
            Lender) and payments of fees and expenses (other than fees or
            expenses that are for Agent's separate account, after giving effect
            to any letter agreements between Agent and individual Lenders) shall
            be apportioned ratably among the Lenders. All payments shall be
            remitted to Agent and all such payments (other than payments
            received while no Default or Event of Default has occurred and is
            continuing and which relate to the payment of principal or interest
            of specific Obligations or which relate to the payment of specific
            fees), and all proceeds of Accounts or other Collateral received by
            Agent, shall be applied as follows:

                 (A) FIRST, to pay any Lender Group Expenses then due to Agent
            under the Loan Documents, until paid in full,

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<PAGE>

                 (B) SECOND, to pay any Lender Group Expenses then due to the
            Lenders under the Loan Documents, on a ratable basis, until paid in
            full,

                 (C) THIRD, to pay any fees then due to Agent (for its separate
            account, after giving effect to any letter agreements between Agent
            and individual Lenders) under the Loan Documents until paid in full,

                 (D) FOURTH, to pay any fees then due to any or all of the
            Lenders (after giving effect to any letter agreements between Agent
            and individual Lenders) under the Loan Documents, on a ratable
            basis, until paid in full,

                 (E) FIFTH, to pay interest due in respect of all Agent
            Advances, until paid in full,

                 (F) SIXTH, ratably to pay interest due in respect of the
            Advances (other than Agent Advances), and the Swing Loans, until
            paid in full,

                 (G) SEVENTH, to pay the principal of all Agent Advances until
            paid in full,

                 (H) EIGHTH, to pay the principal of all Swing Loans until paid
            in full,

                 (I) NINTH, to pay the principal of all Advances (other than
            Agent Advances), until paid in full,

                 (J) TENTH, to pay any other Obligations until paid in full, and

                 (K) ELEVENTH, to Borrower (to be wired to the Designated
            Account) or such other Person entitled thereto under applicable law.

                 (ii) Agent promptly shall distribute to each Lender, pursuant
            to the applicable wire instructions received from each Lender in
            writing, such funds as it may be entitled to receive, subject to a
            Settlement delay as provided in SECTION 2.3(H).

                 (iii) In each instance, so long as no Event of Default has
            occurred and is continuing, SECTION 2.4(B) shall not be deemed to
            apply to any payment by Borrower specified by Borrower to be for the
            payment of specific Obligations then due and payable (or prepayable)
            under any provision of this Agreement.

                 (iv) For purposes of the foregoing, "paid in full" means
            payment of all amounts owing under the Loan Documents according to
            the terms thereof, including loan fees, service fees, professional
            fees, interest (and specifically including interest accrued after
            the commencement of any Insolvency Proceeding), default interest,
            interest on interest, and expense reimbursements, whether or not the
            same would be or is allowed or disallowed in whole or in part in any
            Insolvency Proceeding.

                                      -35-

<PAGE>

                 (v) Notwithstanding anything to the contrary, the Applicable
            Prepayment Premium shall not be paid to any Lender until all other
            Obligations have been paid in full.

                 (vi) In the event of a direct conflict between the priority
            provisions of this SECTION 2.4 and other provisions contained in any
            other Loan Document, it is the intention of the parties hereto that
            such priority provisions in such documents shall be read together
            and construed, to the fullest extent possible, to be in concert with
            each other. In the event of any actual, irreconcilable conflict that
            cannot be resolved as aforesaid, the terms and provisions of this
            SECTION 2.4 shall control and govern.

                 2.5 OVERADVANCES. If, at any time or for any reason, the amount
            of Obligations owed by Borrower to the Lender Group pursuant to
            SECTION 2.1 is greater than either the Dollar or percentage
            limitations set forth in SECTION 2.1, (an "Overadvance"), Borrower
            immediately shall pay to Agent, in cash, the amount of such excess,
            which amount shall be used by Agent to reduce the Obligations in
            accordance with the priorities set forth in SECTION 2.4(B). In
            addition, Borrower hereby promises to pay the Obligations (including
            principal, interest, fees, costs, and expenses) in Dollars in full
            to the Lender Group as and when due and payable under the terms of
            this Agreement and the other Loan Documents.

                 2.6 INTEREST RATES: RATES, PAYMENTS, AND CALCULATIONS.

                 (a) INTEREST RATE. Except as provided in paragraphs (b) and (c)
            below, all Obligations that have been charged to the Loan Account
            pursuant to the terms hereof shall bear interest on the Daily
            Balance thereof at a per annum rate equal to the Base Rate plus the
            Base Rate Margin.

                 (b) MINIMUM INTEREST. The foregoing paragraph (a)
            notwithstanding, at no time shall any portion of the Obligations
            bear interest on the Daily Balance thereof at a per annum rate less
            than 10.0%. To the extent that interest accrued hereunder at the
            rate set forth herein would be less than the foregoing minimum daily
            rate, the interest rate chargeable hereunder for such day
            automatically shall be deemed increased to the minimum rate.

                 (c) DEFAULT RATE. Upon the occurrence and during the
            continuation of an Event of Default (and at the election of Agent or
            the Required Lenders), all Obligations that are due and payable,
            whether or not such Obligations have been charged to the Loan
            Account pursuant to the terms hereof, shall bear interest on the
            Daily Balance thereof at a per annum rate equal to 2.0 percentage
            points above the per annum rate otherwise applicable hereunder.

                 (d) PAYMENT. Interest and all fees payable hereunder shall be
            payable, in arrears, on the first Business Day of each month at any
            time that Obligations or Commitments are outstanding, PROVIDED that
            such interest and fees shall not be due and payable until three (3)
            Business Days after written notice of such interest and fees is
            delivered by facsimile, overnight courier, electronic mail or
            personally to Borrower. All costs payable hereunder and all Lender

                                      -36-

<PAGE>

            Group Expenses (as and when incurred) shall be due and payable three
            (3) Business Days after written notice of such costs and Lender
            Group Expenses is delivered to Borrower as provided in the
            immediately preceding sentence. Borrower hereby authorizes Agent,
            from time to time without prior notice to Borrower, to, and Agent
            may, charge such interest and fees, all Lender Group Expenses, the
            fees and costs provided for in SECTION 2.11 (as and when accrued or
            incurred), and all other payments, in each case, as and when due and
            payable under any Loan Document to Borrower's Loan Account, which
            amounts thereafter constitute Advances hereunder and shall accrue
            interest at the rate then applicable to Advances hereunder, PROVIDED
            that, for the avoidance of doubt (i) Advances may be charged to the
            Borrower's Loan Account without the necessity of any notice to
            Borrower and (ii) interest, fees, Lender Group Expenses and costs
            shall not be charged to the Borrower's Loan Account or accrue
            interest until the three (3) Business Day's notice described above
            is delivered to Borrower and such three (3) Business Day period has
            expired. Any interest not paid when due and payable shall be
            compounded by being charged to Borrower's Loan Account and shall
            thereafter constitute Advances hereunder and shall accrue interest
            at the rate then applicable to Advances hereunder.

                 (e) COMPUTATION. All interest and fees chargeable under the
            Loan Documents shall be computed on the basis of a 360 day year for
            the actual number of days elapsed. In the event the Base Rate is
            changed from time to time hereafter, the rates of interest hereunder
            based upon the Base Rate automatically and immediately shall be
            increased or decreased by an amount equal to such change in the Base
            Rate.

                 (f) INTENT TO LIMIT CHARGES TO MAXIMUM LAWFUL RATE. In no event
            shall the interest rate or rates payable under this Agreement, plus
            any other amounts paid in connection herewith, exceed the highest
            rate permissible under any law that a court of competent
            jurisdiction shall, in a final determination, deem applicable.
            Borrower and the Lender Group, in executing and delivering this
            Agreement, intend legally to agree upon the rate or rates of
            interest and manner of payment stated within it; PROVIDED, HOWEVER,
            that, anything contained herein to the contrary notwithstanding, if
            said rate or rates of interest or manner of payment exceeds the
            maximum allowable under applicable law, then, IPSO FACTO, as of the
            date of this Agreement, Borrower is and shall be liable only for the
            payment of such maximum as allowed by law, and payment received from
            Borrower in excess of such legal maximum, whenever received, shall
            be applied to reduce the principal balance of the Obligations to the
            extent of such excess.

                 2.7 CASH MANAGEMENT.

                 (a) Borrower and Servicer shall (i) establish and maintain cash
            management services of a type and on terms satisfactory to Agent at
            one or more of the banks set forth on Schedule 2.7(a) (each, a "Cash
            Management Bank"), and shall request in writing and otherwise take
            such reasonable steps to ensure that all of its Account Debtors
            forward payment of the amounts owed by them directly to such Cash
            Management Bank, and (ii) deposit or cause to be deposited promptly,
            and in any event no later than the first Business Day after the date
            of receipt thereof, all Collections (including those sent directly
            by Account Debtors to a Cash Management Bank) into a bank account in
            Agent's name (a "Cash Management Account") at one of the Cash
            Management Banks.

                                      -37-

<PAGE>

                 (b) Each Cash Management Bank shall establish and maintain Cash
            Management Agreements with Agent, Borrower and Servicer, in form and
            substance acceptable to Agent. Each such Cash Management Agreement
            shall provide, among other things, that (i) all items of payment
            deposited in such Cash Management Account and proceeds thereof are
            held by such Cash Management Bank as agent or bailee-in-possession
            for Agent, (ii) the Cash Management Bank has no rights of setoff or
            recoupment or any other claim against the applicable Cash Management
            Account other than for payment of its service fees and other charges
            directly related to the administration of such Cash Management
            Account and for returned checks or other items of payment, and (iii)
            on and after the date on which it receives a Notice of Sole Control
            from Agent, it immediately will forward by daily sweep all amounts
            in the applicable Cash Management Account to the Agent's Account.
            Agent agrees that it shall not deliver a Notice of Sole Control
            unless an Event of Default has occurred and is continuing. So long
            as no Event of Default has occurred and is continuing, Borrower may
            withdraw amounts on deposit in the Cash Management Accounts (i) to
            purchase Eligible Subject Accounts pursuant to the Purchase
            Agreement, subject to the proviso to SECTION 6.14, (ii) to pay or
            prepay Obligations, (iii) to pay obligations permitted by the
            proviso to SECTION 7.7, (iv) to make distributions or pay dividends
            to the extent permitted under SECTION 7.11, or (v) to make loans or
            advances to the extent permitted under SECTION 7.13, and for no
            other purpose. Upon the occurrence and during the continuance of an
            Event of Default, Borrower shall not withdraw any amount from the
            Cash Management Accounts and, following delivery by Agent of a
            Notice of Sole Control, all such amounts shall be forwarded to the
            Agent's Account in accordance with clause (iii) above.

                 (c) So long as no Default or Event of Default has occurred and
            is continuing, Borrower and Servicer may amend Schedule 2.7(a) to
            add or replace a Cash Management Bank or Cash Management Account;
            PROVIDED, HOWEVER, that (i) such prospective Cash Management Bank
            shall be satisfactory to Agent and Agent shall have consented (which
            consent shall not be unreasonably withheld or delayed) in writing in
            advance to the opening of such Cash Management Account with the
            prospective Cash Management Bank, and (ii) prior to the time of the
            opening of such Cash Management Account, Borrower and such
            prospective Cash Management Bank shall have executed and delivered
            to Agent a Cash Management Agreement. Borrower shall close any of
            its Cash Management Accounts (and establish replacement cash
            management accounts in accordance with the foregoing sentence)
            promptly and in any event within 30 days of notice from Agent that
            the creditworthiness of any Cash Management Bank is no longer
            acceptable in Agent's reasonable judgment, or as promptly as
            practicable and in any event within 60 days of notice from Agent
            that the operating performance, funds transfer, or availability
            procedures or performance of the Cash Management Bank with respect
            to Cash Management Accounts or Agent's liability under any Cash
            Management Agreement with such Cash Management Bank is no longer
            acceptable in Agent's reasonable judgment.

                 (d) The Cash Management Accounts shall be cash collateral
            accounts, with all cash, checks and similar items of payment in such
            accounts securing payment of the Obligations, and in which Borrower
            is hereby deemed to have granted a Lien to Agent.

                 2.8 CREDITING PAYMENTS. The receipt of any payment item by
            Agent (whether from transfers to Agent by the Cash Management Banks
            pursuant to the Cash Management Agreements or otherwise) shall not
            be considered a payment on account unless such payment item is a
            wire transfer of immediately available federal funds made to the

                                      -38-

<PAGE>

            Agent's Account or unless and until such payment item is honored
            when presented for payment. Should any payment item not be honored
            when presented for payment, then Borrower shall be deemed not to
            have made such payment and interest shall be calculated accordingly.
            Anything to the contrary contained herein notwithstanding, any
            payment item shall be deemed received by Agent only if it is
            received into the Agent's Account on a Business Day on or before
            11:00 a.m. (California time). If any payment item is received into
            the Agent's Account on a non-Business Day or after 11:00 a.m.
            (California time) on a Business Day, it shall be deemed to have been
            received by Agent as of the opening of business on the immediately
            following Business Day.

                 2.9 DESIGNATED ACCOUNT. Agent is authorized to make the
            Advances under this Agreement based upon telephonic or other
            instructions received from anyone purporting to be an Authorized
            Person, or without instructions if pursuant to SECTION 2.6(D).
            Borrower agrees to establish and maintain the Designated Account
            with the Designated Account Bank for the purpose of receiving the
            proceeds of the Advances requested by Borrower and made by Agent or
            the Lenders hereunder. Unless otherwise agreed by Agent and
            Borrower, any Advance, Agent Advance, or Swing Loan requested by
            Borrower and made by Agent or the Lenders hereunder shall be made to
            the Designated Account.

                 2.10 MAINTENANCE OF LOAN ACCOUNT; STATEMENTS OF OBLIGATIONS.
            (a) Agent shall maintain an account on its books in the name of
            Borrower (the "Loan Account") on which Borrower will be charged with
            all Advances (including Agent Advances and Swing Loans) made by
            Agent, Swing Lender, or the Lenders to Borrower or for Borrower's
            account, and, subject to Section 2.6(d), with all other payment
            Obligations hereunder or under the other Loan Documents that are due
            and payable, including, accrued interest, fees and expenses, and
            Lender Group Expenses, in each case that are due and payable. In
            accordance with SECTION 2.8, the Loan Account will be credited with
            all payments received by Agent from Borrower or for Borrower's
            account, including all amounts received in the Agent's Account from
            any Cash Management Bank. Agent shall render statements regarding
            the Loan Account to Borrower, including principal, interest, fees,
            and including an itemization of all charges and expenses
            constituting Lender Group Expenses owing, and such statements shall
            be conclusively presumed to be correct and accurate and constitute
            an account stated between Borrower and the Lender Group unless,
            within 30 days after receipt thereof by Borrower, Borrower shall
            deliver to Agent written objection thereto describing the error or
            errors contained in any such statements.

                 (b) Any Lender may request that any Advance made by it be
            evidenced by a promissory note. In such event, Borrower shall
            execute and deliver to such Lender a promissory note payable to the
            order of such Lender (or, if requested by such Lender, to such
            Lender and its registered assigns) in a form furnished by Agent and
            reasonably acceptable to Borrower. Thereafter, any Advance evidenced
            by such promissory note and interest thereon shall at all times
            (including after assignment pursuant to SECTION 14.1) be represented
            by one or more promissory notes in such form payable to the order of
            the payee named therein (or, if such promissory note is a registered
            note, to such payee and its registered assigns).

                 2.11 FEES. Borrower shall pay to Agent the following fees and
            charges, which fees and charges shall be non-refundable when paid
            (irrespective of whether this Agreement is terminated thereafter)

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<PAGE>

            and shall be apportioned among the Lenders in accordance with the
            terms of letter agreements between Agent and individual Lenders:

                 (a) UNUSED LINE FEE. On the first day of each month during the
            term of this Agreement, an unused line fee in an amount equal to
            .50% per annum TIMES the result of (a) the Maximum Revolver Amount,
            LESS (b) the average Daily Balance of Advances that were outstanding
            during the immediately preceding month,

                 (b) FEE LETTER FEES. As and when due and payable under the
            terms of the Fee Letter, Borrower shall pay to Agent the fees set
            forth in the Fee Letter, and

                 (c) AUDIT, APPRAISAL, AND VALUATION CHARGES. For the separate
            account of Agent, audit, appraisal, and valuation fees and charges
            as follows (i) a fee of $850 per day, per auditor, plus
            out-of-pocket expenses for each financial audit of Borrower
            performed by personnel employed by Agent, (ii) if implemented, a one
            time charge of $25,000 plus out-of-pocket expenses for expenses for
            the establishment of electronic collateral reporting systems, and
            (iii) the actual charges paid or incurred by Agent if it elects to
            employ the services of one or more third Persons to perform
            financial audits of Borrower or to appraise the Collateral, or any
            portion thereof, PROVIDED that, so long as no Default or Event of
            Default shall have occurred and be continuing, Borrower shall not be
            responsible for the fees, charges and other costs of more than four
            (4) such audits, appraisals or valuations in any calendar year.

                 2.12 CAPITAL REQUIREMENTS. If, after the date hereof, any
            Lender, in its Permitted Discretion, determines that (i) the
            adoption of or change in any law, rule, regulation or guideline
            regarding capital requirements for banks or bank holding companies,
            or any change in the interpretation or application thereof by any
            Governmental Authority charged with the administration thereof, or
            (ii) compliance by such Lender or its parent bank holding company
            with any guideline, request, or directive of any such entity
            regarding capital adequacy (whether or not having the force of law),
            the effect of reducing the return on such Lender's or such holding
            company's capital as a consequence of such Lender's Commitments
            hereunder to a level below that which such Lender or such holding
            company could have achieved but for such adoption, change, or
            compliance (taking into consideration such Lender's or such holding
            company's then existing policies with respect to capital adequacy
            and assuming the full utilization of such entity's capital) by any
            amount deemed by such Lender to be material, then such Lender may
            notify Borrower and Agent thereof. Following receipt of such notice,
            Borrower agrees to pay such Lender on demand the amount of such
            reduction of return of capital as and when such reduction is
            determined, payable within 90 days after presentation by such Lender
            of a statement in the amount and setting forth in reasonable detail
            such Lender's calculation thereof and the assumptions upon which
            such calculation was based (which statement shall be deemed true and
            correct absent manifest error), PROVIDED that, except to the extent
            such law, rule, regulation, guideline, request, or directive shall
            have retroactive effect, if a Lender shall fail to give notice of
            such law, rule, regulation, guideline, request, or directive within
            180 days after such Lender obtains actual knowledge thereof, then
            Borrower shall not be liable for any such reduction suffered more
            than 180 days prior to the date such notice is provided. In
            determining such amount, such Lender may use any reasonable
            averaging and attribution methods.

                                      -40-

<PAGE>

                 3. CONDITIONS; TERM OF AGREEMENT.

                 3.1 CONDITIONS PRECEDENT TO THE INITIAL EXTENSION OF CREDIT.
            The obligation of the Lender Group (or any member thereof) to make
            the initial Advance (or otherwise to extend any credit provided for
            hereunder), is subject to the fulfillment, to the satisfaction of
            Agent, of each of the conditions precedent set forth below:

                 (a) the Closing Date shall occur on or before August 19, 2002;

                 (b) Agent shall have received (i) a letter authorizing Agent to
            pre-file the financing statements required hereunder and under the
            Purchase Agreement, duly executed by Borrower, Servicer and each
            Originator, (ii) all financing statements required by Agent, naming
            Borrower as debtor and Agent as secured party, (iii) all financing
            statements required by Agent, naming each Originator as debtor,
            Borrower as secured party and Agent as assignee, and (iii) evidence
            satisfactory to Agent of the filing of all such financing
            statements;

                 (c) Agent shall have received each of the following documents,
            in form and substance satisfactory to Agent, duly executed, and each
            such document shall be in full force and effect:

                         (i) the Control Agreements,

                         (ii) the Disbursement Letter,

                         (iii) the Fee Letter,

                         (iv) the Guaranty,

                         (v) the Cash Management Agreements,

                         (vi) the Officers' Certificate,

                         (vii) the Purchase Agreement, and

                         (viii) the Servicing Agreement;

                 (d) Agent shall have received a certificate from the Secretary
            of Borrower, Servicer and each Originator (i) attesting to the
            resolutions of such Person's Board of Directors authorizing its
            execution, delivery, and performance of the Transaction Documents to
            which such Person is a party and authorizing specific officers of
            such Person to execute the same, and (ii) certifying the names and
            true signatures of the officers of such Person authorized to sign
            each Transaction Document to which such Person is a party;

                 (e) Agent shall have received copies of Borrower's, Servicer's
            and each Originator's Governing Documents, as amended, modified, or
            supplemented to the Closing Date, certified by the Secretary of such
            Person;

                                      -41-

<PAGE>

                 (f) Agent shall have received a certificate of status with
            respect to Borrower, Servicer and each Originator, dated within 10
            days of the Closing Date, such certificate to be issued by the
            appropriate officer of the jurisdiction of organization of such
            Person, which certificate shall indicate that such Person is in good
            standing in such jurisdiction;

                 (g) Agent shall have received certificates of status with
            respect to Borrower, Servicer and each Originator, each dated within
            30 days of the Closing Date, such certificates to be issued by the
            appropriate officer of the jurisdiction in which each such Person
            maintains its chief executive office (but only to the extent that
            such Person's failure to be duly qualified or licensed in such
            jurisdiction would constitute a Material Adverse Change), which
            certificates shall indicate that such Person is in good standing in
            such jurisdictions;

                 (h) Agent shall have received a certificate from the Secretary
            of Guarantor (i) attesting to the resolutions of Guarantor's Board
            of Directors authorizing its execution, delivery, and performance of
            the Loan Documents to which Guarantor is a party and authorizing
            specific officers of Guarantor to execute the same, and (ii)
            certifying the names and true signatures of the officers of
            Guarantor authorized to sign each Loan Document to which Guarantor
            is a party;

                 (i) Agent shall have received copies of Guarantor's Governing
            Documents, as amended, modified, or supplemented to the Closing
            Date, certified by the Secretary of Guarantor;

                 (j) Agent shall have received a certificate of status with
            respect to Guarantor, dated within 10 days of the Closing Date, such
            certificate to be issued by the appropriate officer of the
            jurisdiction of organization of Guarantor, which certificate shall
            indicate that Guarantor is in good standing in such jurisdiction;

                 (k) Agent shall have received certificates of status with
            respect to Guarantor, each dated within 30 days of the Closing Date,
            such certificates to be issued by the appropriate officer of the
            jurisdiction in which each Guarantor maintains its chief executive
            office (but only to the extent that Guarantor's failure to be duly
            qualified or licensed in such jurisdiction would constitute a
            Material Adverse Change), which certificates shall indicate that
            Guarantor is in good standing in such jurisdictions;

                 (l) [INTENTIONALLY OMITTED]

                 (m) [INTENTIONALLY OMITTED]

(n) Agent shall have received an opinion of Borrower's counsel in form and
substance satisfactory to the Lenders, such opinion to include, without
limitation, an opinion that the Transactions will be deemed a "true sale" under
the Bankruptcy Code and other applicable law;

                 (o) Agent shall be satisfied with the Companies' cash
            management systems, including as to the absence of commingling of
            funds among Borrower and the other Companies;

                                     -42-

<PAGE>

                 (p) the Lenders shall have completed their business, legal, and
            collateral due diligence, including a takeover audit, a roll-forward
            of accounts receivable, the senior-sponsor visit and review of
            Borrower's, Servicer's and each Originator's books and records and
            verification of Borrower's, Servicer's and each Originator's
            representations and warranties to the Lender Group, the results of
            which shall in each case be satisfactory to the Lenders;

                 (q) Agent shall have received completed reference checks with
            respect to Borrower's senior management, the results of which are
            satisfactory to Agent in its sole discretion;

                 (r) the Lenders shall have received the Closing Date Business
            Plan;

                 (s) Borrower shall pay all Lender Group Expenses incurred in
            connection with the transactions evidenced by the Transaction
            Documents, PROVIDED that Borrower has received invoices, each in
            reasonable detail, with respect thereto;

                 (t) Agent shall have received copies of each Material Contract,
            together with a certificate of the Secretary of Borrower certifying
            each such document as being a true, correct, and complete copy
            thereof;

                 (u) Borrower shall have received all licenses, approvals or
            evidence of other actions required by any Governmental Authority in
            connection with the execution and delivery by Borrower of this
            Agreement or any other Transaction Document or with the consummation
            of the transactions contemplated hereby and thereby;

                 (v) any consent, waiver or other approval required to be
            obtained from any Person under any of the Debt Documents in order to
            permit the execution, delivery and performance of the Transaction
            Documents and the consummation of the Transactions shall have been
            duly executed and delivered by such Person, shall be in form and
            substance satisfactory to Agent, and a copy of the same shall have
            been delivered to Agent, together with a certificate of the
            Secretary of Borrower certifying each such consent, waiver or other
            approval as being a true, correct and complete copy thereof;

                 (w) the parties to the Existing Credit Agreement shall have
            entered into the Existing Credit Agreement, the terms of which shall
            be satisfactory to Agent, and a copy of the same shall have been
            delivered to Agent, together with a certificate of the Secretary of
            Borrower certifying such agreement as being a true, correct and
            complete copy thereof;

                 (x) Agent and its counsel shall be satisfied that upon the
            execution and delivery of the documents referred to in clauses (v)
            and (w) above, no other waivers, consents or other approvals shall
            be required under any Material Contract in order to permit the
            execution, delivery and performance of the Transaction Documents and
            the consummation of the Transactions;

                 (y) Borrower, Servicer and the Originators shall have duly
            executed and delivered the Purchase Agreement and the following
            transactions shall have been consummated pursuant to the terms of
            the Purchase Agreement (the "Initial Transactions"): (i) the
            Originators shall have contributed to Borrower Subject Accounts in
            an aggregate amount of not less than $190,094,197.30; (ii) Borrower
            shall have issued to the Originators shares of its capital Stock in
            exchange therefore; (iii) concurrently with the making of the
            initial Advance hereunder, Borrower shall have purchased additional
            Subject Accounts from the Originators in an aggregate principal
            amount of not less than $25,880,874.61, shall have paid to the
            Originators cash consideration of at least $21,998,743.42 and shall
            have delivered to the Originators the Subordinated Note; and (iv)
            after giving effect to the preceding clauses (i) and (iii), Borrower
            shall have acquired good and marketable title to all Subject
            Accounts then in existence, free and clear of any Lien other than
            Permitted Liens;

                                      -43-

<PAGE>

                 (z) Borrower shall have Availability in an amount of not less
            than $5,000,000 after giving effect to the initial Advances
            hereunder and the payment of all fees and expenses required to be
            paid by Borrower on the Closing Date under this Agreement and the
            other Loan Documents;

                 (aa) Borrower shall have implemented a system of electronic
            collateral reporting, satisfactory to Agent in all respects, in
            order to provide electronic reporting of the Borrowing Base in
            accordance with SECTION 6.2(F);

                 (bb) the Lenders shall have received and be satisfied with the
            preliminary financial statements of Parent and its Subsidiaries for
            the fiscal quarter ending June 30, 2002; and

                 (cc) all other documents and legal matters in connection with
            the transactions contemplated by this Agreement shall have been
            delivered, executed, or recorded and shall be in form and substance
            satisfactory to Agent.

                 3.2 CONDITIONS SUBSEQUENT TO THE INITIAL EXTENSION OF CREDIT.
            The obligation of the Lender Group (or any member thereof) to
            continue to make Advances (or otherwise extend credit hereunder) is
            subject to the fulfillment, on or before the date applicable
            thereto, of each of the conditions subsequent set forth below (the
            failure by Borrower to so perform or cause to be performed
            constituting an Event of Default):

                 (a) Within 30 days of the Closing Date, the Agent shall have
            received Collateral Access Agreements with respect to the corporate
            headquarters (or other location where the books and records with
            respect to the Subject Accounts or the Collateral are maintained)
            of Borrower, Servicer and each Originator.

                 3.3 CONDITIONS PRECEDENT TO ALL EXTENSIONS OF CREDIT. The
            obligation of the Lender Group (or any member thereof) to make all
            Advances (or to extend any other credit hereunder) shall be subject
            to the following conditions precedent:

                 (a) the representations and warranties contained in this
            Agreement and the other Transaction Documents shall be true and
            correct in all material respects on and as of the date of such
            extension of credit, as though made on and as of such date (except
            to the extent that such representations and warranties relate solely
            to an earlier date),

                 (b) no Default or Event of Default shall have occurred and be
            continuing on the date of such extension of credit, nor shall either
            result from the making thereof,

                                      -44-

<PAGE>

                 (c) no injunction, writ, restraining order, or other order of
            any nature prohibiting, directly or indirectly, the extending of
            such credit or the consummation of any of the Transactions shall
            have been issued and remain in force by any Governmental Authority
            against Borrower, Servicer, any Originator, Agent, any Lender, or
            any of their Affiliates;

                 (d) the amount of the Revolver Usage, after giving effect to
            the requested Advance, shall not exceed Availability; and

                 (e) no Material Adverse Change shall have occurred.

                 3.4 TERM. This Agreement shall become effective upon the
            execution and delivery hereof by Borrower, Agent, and the Lenders
            and shall continue in full force and effect for a term ending on
            August 15, 2005 (the "Maturity Date"). The foregoing
            notwithstanding, the Lender Group, upon the election of the Required
            Lenders, shall have the right to terminate its obligations under
            this Agreement immediately and without notice upon the occurrence
            and during the continuation of an Event of Default.

                 3.5 EFFECT OF TERMINATION. On the date of termination of this
            Agreement, all Obligations immediately shall become due and payable
            without notice or demand. No termination of this Agreement, however,
            shall relieve or discharge Borrower of its duties, Obligations, or
            covenants hereunder and the Agent's Liens in the Collateral shall
            remain in effect until all Obligations have been fully and finally
            discharged and the Lender Group's obligations to provide additional
            credit hereunder have been terminated. When this Agreement has been
            terminated and all of the Obligations have been fully and finally
            discharged and the Lender Group's obligations to provide additional
            credit under the Loan Documents have been terminated irrevocably,
            Agent will, at Borrower's sole expense, execute and deliver any UCC
            termination statements, lien releases, mortgage releases,
            re-assignments of trademarks, discharges of security interests, and
            other similar discharge or release documents (and, if applicable, in
            recordable form) as are reasonably necessary to release, as of
            record, the Agent's Liens and all notices of security interests and
            liens previously filed by Agent with respect to the Obligations.

                 3.6 EARLY TERMINATION BY BORROWER. Borrower has the option, at
            any time upon 30 days prior written notice to Agent, to terminate
            this Agreement by paying to Agent, for the benefit of the Lender
            Group, in cash, the Obligations. If Borrower has sent a notice of
            termination pursuant to the provisions of this Section, then the
            Commitments shall terminate and Borrower shall be obligated to repay
            the Obligations in full, together with the Applicable Prepayment
            Premium, on the date set forth as the date of termination of this
            Agreement in such notice. In the event of the termination of this
            Agreement and repayment of the Obligations at any time prior to the
            Maturity Date, for any other reason, including (a) termination upon
            the election of the Required Lenders to terminate after the
            occurrence of an Event of Default, (b) foreclosure and sale of
            Collateral, (c) sale of the Collateral in any Insolvency Proceeding,
            or (iv) restructure, reorganization, or compromise of the
            Obligations by the confirmation of a plan of reorganization or any
            other plan of compromise, restructure, or arrangement in any
            Insolvency Proceeding, then, in view of the impracticability and
            extreme difficulty of ascertaining the actual amount of damages to
            the Lender Group or profits lost by the Lender Group as a result of
            such early termination, and by mutual agreement of the parties as to
            a reasonable estimation and calculation of the lost profits or
            damages of the Lender Group, Borrower shall pay the Applicable
            Prepayment Premium to Agent (to be allocated based upon letter
            agreements between Agent and individual Lenders), measured as of the
            date of such termination.

                                      -45-

<PAGE>

4.         CREATION OF SECURITY INTEREST.

                 4.1 GRANT OF SECURITY INTEREST. Borrower hereby grants to
            Agent, for the benefit of the Lender Group, a continuing security
            interest in all of its right, title, and interest in all currently
            existing and hereafter acquired or arising Collateral in order to
            secure prompt repayment of any and all of the Obligations in
            accordance with the terms and conditions of the Loan Documents and
            in order to secure prompt performance by Borrower of each of its
            covenants and duties under the Loan Documents. The Agent's Liens in
            and to the Collateral shall attach to all Collateral without further
            act on the part of Agent or Borrower. Anything contained in this
            Agreement or any other Loan Document to the contrary
            notwithstanding, except for Permitted Dispositions, Borrower has no
            authority, express or implied, to dispose of any item or portion of
            the Collateral.

                 4.2 NEGOTIABLE COLLATERAL. In the event that any Collateral,
            including proceeds, is evidenced by or consists of Negotiable
            Collateral, and if and to the extent that perfection or priority of
            Agent's security interest is dependent on or enhanced by possession,
            Borrower, immediately upon the request of Agent, shall endorse and
            deliver physical possession of such Negotiable Collateral to Agent.

                 4.3 COLLECTION OF ACCOUNTS, GENERAL INTANGIBLES, AND NEGOTIABLE
            COLLATERAL. At any time after the occurrence and during the
            continuation of an Event of Default, Agent or Agent's designee may
            (a) notify Account Debtors of Borrower that the Accounts, chattel
            paper, or General Intangibles have been assigned to Agent or that
            Agent has a security interest therein, or (b) collect the Accounts,
            chattel paper, or General Intangibles directly and charge the
            collection costs and expenses to the Loan Account. Borrower agrees
            that it will hold in trust for the Lender Group, as the Lender
            Group's trustee, any Collections that it receives and immediately
            will deliver said Collections to Agent or a Cash Management Bank in
            their original form as received by Borrower.

                 4.4 DELIVERY OF ADDITIONAL DOCUMENTATION REQUIRED. At any time
            upon the request of Agent, Borrower shall execute and deliver to
            Agent, any and all financing statements, original financing
            statements in lieu of continuation statements, security agreements,
            pledges, assignments, endorsements of certificates of title, and all
            other documents (the "Additional Documents") that Agent may request
            in its Permitted Discretion, in form and substance satisfactory to
            Agent, to perfect and continue perfected or better perfect the
            Agent's Liens in the Collateral (whether now owned or hereafter
            arising or acquired), and in order to fully consummate all of the
            transactions contemplated hereby and under the other Transaction
            Documents. To the maximum extent permitted by applicable law,
            Borrower authorizes Agent to execute any such Additional Documents
            in Borrower's name and authorizes Agent to file such executed
            Additional Documents in any appropriate filing office.

                 4.5 POWER OF ATTORNEY. Borrower hereby irrevocably makes,
            constitutes, and appoints Agent (and any of Agent's officers,
            employees, or agents designated by Agent), to the extent permitted
            by applicable law, as Borrower's true and lawful attorney, with
            power to (a) if Borrower refuses to, or fails timely to execute and
            deliver any of the documents described in SECTION 4.4, sign the name
            of Borrower on any of the documents described in SECTION 4.4, (B) at
            any time that an Event of Default has occurred and is continuing,

                                      -46-

<PAGE>

            sign Borrower's name on any invoice or bill of lading relating to
            the Collateral, drafts against Account Debtors, or notices to
            Account Debtors, (c) send requests for verification of Accounts, (d)
            endorse Borrower's name on any Collection item that may come into
            the Lender Group's possession, (e) at any time that an Event of
            Default has occurred and is continuing, make, settle, and adjust all
            claims under Borrower's policies of insurance and make all
            determinations and decisions with respect to such policies of
            insurance, and (f) at any time that an Event of Default has occurred
            and is continuing, settle and adjust disputes and claims respecting
            the Accounts, chattel paper, or General Intangibles directly with
            Account Debtors, for amounts and upon terms that Agent determines to
            be reasonable, and Agent may cause to be executed and delivered any
            documents and releases that Agent determines to be necessary. The
            appointment of Agent as Borrower's attorney, and each and every one
            of its rights and powers, being coupled with an interest, is
            irrevocable until all of the Obligations have been fully and finally
            repaid and performed and the Lender Group's obligations to extend
            credit hereunder are terminated.

                 4.6 RIGHT TO INSPECT. Agent and each Lender (through any of
            their respective officers, employees, or agents) shall have the
            right, from time to time hereafter to inspect the Books and to
            check, test, and appraise the Collateral in order to verify
            Borrower's financial condition or the amount, quality, value,
            condition of, or any other matter relating to, the Collateral,
            PROVIDED that, so long as no Default or Event of Default shall have
            occurred and be continuing, (i) such inspections shall only be
            conducted during normal business hours and (ii) Borrower shall not
            be responsible for the fees, charges and other costs of more than
            four (4) such audits, appraisals or valuations during any calendar
            year. Without limiting the foregoing, Agent shall have the right to
            review the Material Contracts (other than the Debt Documents) on a
            quarterly basis, or at such intervals as Agent shall determine.
            Agent may retain advisors to assist in such review and the
            out-of-pocket expenses incurred by Agent in connection therewith
            shall constitute Lender Group Expenses and Obligations hereunder.

                 4.7 CONTROL AGREEMENTS. Borrower agrees that it will not
            transfer assets out of any Securities Accounts other than as
            permitted under SECTION 7.19 and, if to another securities
            intermediary, unless each of Borrower, Agent, and the substitute
            securities intermediary have entered into a Control Agreement. No
            arrangement contemplated hereby or by any Control Agreement in
            respect of any Securities Accounts or other Investment Property
            shall be modified by Borrower without the prior written consent of
            Agent. Upon the occurrence and during the continuance of a Default
            or Event of Default, Agent may notify any securities intermediary to
            liquidate the applicable Securities Account or any related
            Investment Property maintained or held thereby and remit the
            proceeds thereof to the Agent's Account.

                 5. REPRESENTATIONS AND WARRANTIES.

                 In order to induce the Lender Group to enter into this
            Agreement, Borrower makes the following representations and
            warranties to the Lender Group which shall be true, correct, and
            complete, in all material respects, as of the date hereof, and shall
            be true, correct, and complete, in all material respects, as of the
            Closing Date, and at and as of the date of the making of each
            Advance (or other extension of credit) made thereafter, as though
            made on and as of the date of such Advance (or other extension of

                                      -47-

<PAGE>

            credit) (except to the extent that such representations and
            warranties relate solely to an earlier date) and such
            representations and warranties shall survive the execution and
            delivery of this Agreement:

                 5.1 NO ENCUMBRANCES. Borrower has good and indefeasible title
            to the Collateral, free and clear of Liens except for Permitted
            Liens.

                 5.2 ELIGIBLE ACCOUNTS. The Eligible Accounts are Purchased
            Accounts which are bona fide existing payment obligations of Account
            Debtors created by the sale and delivery of Inventory or the
            rendition of services to such Account Debtors in the ordinary course
            of the Originators' business, owed to Borrower without defenses,
            disputes, offsets, counterclaims, or rights of return or
            cancellation. Each such Eligible Account complies with each clause
            of the definition thereof set forth in SECTION 1.1.

                 5.3 LOCATION OF CHIEF EXECUTIVE OFFICE; FEIN. The chief
            executive office of Borrower, Servicer and each Originator is
            located at the address indicated in Schedule 5.3 and Borrower's,
            Servicer's and each Originator's FEIN is identified in Schedule 5.3.

                 5.4 DUE ORGANIZATION AND QUALIFICATION; SUBSIDIARIES.

                 (a) Each of Borrower, Servicer and each Originator is duly
            organized and existing and in good standing under the laws of the
            jurisdiction of its organization and qualified to do business in any
            state where the failure to be so qualified reasonably could
            reasonably be expected to have a Material Adverse Change.

                 (b) Set forth on Schedule 5.4(b), is a complete and accurate
            description of the authorized capital Stock of Borrower, by class,
            and, as of the Closing Date, a description of the membership
            interests that are outstanding, all of which outstanding membership
            interests are owned by the Originators. There are no subscriptions,
            options, warrants, or calls relating to any shares of Borrower's
            capital Stock, including any right of conversion or exchange under
            any outstanding security or other instrument. Borrower is not
            subject to any obligation (contingent or otherwise) to repurchase or
            otherwise acquire or retire any shares of its capital Stock or any
            security convertible into or exchangeable for any of its capital
            Stock.

                 (c) Borrower has no direct or indirect Subsidiaries.

                 5.5 DUE AUTHORIZATION; NO CONFLICT.

                 (a) The execution, delivery, and performance by Borrower,
            Servicer and each Originator of each Transaction Document to which
            it is a party have been duly authorized by all necessary action on
            the part of such Person.

                 (b) The execution, delivery, and performance by Borrower,
            Servicer and each Originator of each Transaction Document to which
            it is a party do not and will not (i) violate any provision of
            federal, state, or local law or regulation applicable to such
            Person, the Governing Documents of such Person, or any order,
            judgment, or decree of any court or other Governmental Authority
            binding on such Person, (ii) conflict with, result in a breach of,
            or constitute (with due notice or lapse of time or both) a default
            under any Material Contract or any other material contractual
            obligation of such Person, (iii) result in or require the creation

                                      -48-

<PAGE>

            or imposition of any Lien of any nature whatsoever upon any
            properties or assets of Borrower or any Purchased Accounts, other
            than Permitted Liens, or (iv) require any approval of such Person's
            interestholders or any approval or consent of any other Person under
            any Material Contract or under any other material contractual
            obligation of such Person, except to the extent the same has been
            granted in accordance with SECTION 3.1(R).

                 (c) Other than the filing of financing statements, the
            execution, delivery, and performance by Borrower, Servicer and each
            Originator of each Transaction Document to which it is a party do
            not and will not require any registration with, consent, or approval
            of, or notice to, or other action with or by, any Governmental
            Authority.

                 (d) Each Transaction Document to which Borrower, Servicer or
            any Originator is a party, and all other documents contemplated
            hereby and thereby, when executed and delivered by such Person, will
            be the legally valid and binding obligations of such Person,
            enforceable against such Person in accordance with their respective
            terms, except as enforcement may be limited by equitable principles
            or by bankruptcy, insolvency, reorganization, moratorium, or similar
            laws relating to or limiting creditors' rights generally.

                 (e) The Agent's Liens are validly created, perfected, and first
            priority Liens, subject only to Permitted Liens.

                 5.6 LITIGATION. There are no actions, suits, or proceedings
            pending or, to the best knowledge of Borrower, threatened against
            Borrower or Servicer. There is no action, suit, proceeding or
            investigation pending before any court, regulatory body, arbitrator,
            administrative agency, or other tribunal or governmental
            instrumentality (a) asserting the invalidity of any Transaction
            Document, (b) seeking to prevent the issuance of any Originator's
            Originator Assignment Certificate (as defined in the Purchase
            Agreement) or the consummation of any of the transactions
            contemplated by any Transaction Document, or (c) except as set forth
            in the most recent Form 10-Q quarterly reports and Form 10-K annual
            report of the Parent or FW LLC and in SCHEDULE 5.6, seeking any
            determination or ruling that is reasonably likely to result in a
            Material Adverse Change.

                 5.7 NO MATERIAL ADVERSE CHANGE. All financial statements
            relating to the Companies that have been delivered by any Company to
            the Lender Group have been prepared in accordance with GAAP (except,
            in the case of unaudited financial statements, for the lack of
            footnotes and being subject to year-end audit adjustments) and
            present fairly in all material respects, such Company's financial
            condition as of the date thereof and results of operations for the
            period then ended. There has not been a Material Adverse Change with
            respect to Borrower, Servicer or, except as set forth in SCHEDULE
            5.7, any Originator since the date of the latest financial
            statements submitted to the Lender Group on or before the Closing
            Date.

                 5.8 FRAUDULENT TRANSFER.

                 (a) Assuming the consummation of the Existing Credit Agreement,
            each of Borrower, Servicer and each Originator is Solvent.

                                      -49-

<PAGE>

                 (b) No transfer of property is being made by Borrower, Servicer
            or any Originator and no obligation is being incurred by Borrower,
            Servicer or any Originator in connection with the transactions
            contemplated by this Agreement or the other Transaction Documents
            with the intent to hinder, delay, or defraud either present or
            future creditors of any such Person.

                 5.9 EMPLOYEE BENEFITS. None of Borrower or any of its ERISA
            Affiliates maintains or contributes to any Benefit Plan.

                 5.10 BROKERAGE FEES. Borrower has not utilized the services of
            any broker or finder in connection with Borrower's obtaining
            financing from the Lender Group under this Agreement and no
            brokerage commission or finders fee is payable by Borrower in
            connection herewith.

                 5.11 PROPERTY. Borrower does not own or lease any assets or
            property other than (i) Purchased Accounts, (ii) Permitted
            Investments, (iii) General Intangibles arising under the Transaction
            Documents, (iv) Cash and Cash Equivalents constituting proceeds of
            Purchased Accounts, and (v) the Cash Management Accounts, Securities
            Accounts and deposit accounts permitted hereunder (collectively, the
            "Permitted Assets").

                 5.12 OBLIGATIONS. Borrower is not a party to any agreement or
            contract other than the Transaction Documents, its Governing
            Documents, agreements with banks or Securities Intermediaries with
            respect to the deposit accounts and Securities Accounts permitted
            hereunder and as otherwise permitted under SECTION 7.7.

                 5.13 BUSINESS. The Borrower conducts no business other than the
            acquisition of Subject Accounts pursuant to the Purchase Agreement,
            the collection of payment on such Purchased Accounts and as
            otherwise permitted under SECTION 7.7.

                 5.14 DDAS. Set forth on Schedule 5.14 are all of Borrower's
            DDAs, including, with respect to each depository (i) the name and
            address of such depository, and (ii) the account numbers of the
            accounts maintained with such depository.

                 5.15 CREDIT AND COLLECTION POLICIES. Borrower has complied in
            all material respects with the Credit and Collection Policy of each
            Originator with regard to each Purchased Account.

                 5.16 COMPLETE DISCLOSURE. Each schedule, exhibit, financial
            statement, document, book, record or report, and all factual
            information (taken as a whole) contained therein or otherwise
            furnished by or on behalf of Parent, Borrower, Servicer or any
            Originator in writing to Agent or any Lender for purposes of or in
            connection with this Agreement, the other Transaction Documents, or
            any transaction contemplated herein or therein is, and all other
            such factual information (taken as a whole) hereafter furnished by
            or on behalf of any Company in writing to Agent or any Lender will
            be, true and accurate, in all material respects, on the date as of
            which such information is dated or certified and not incomplete by
            omitting to state any fact necessary to make such information (taken
            as a whole) not misleading in any material respect at such time in
            light of the circumstances under which such information was
            provided; PROVIDED, HOWEVER, that with respect to projections and
            similar forward-looking financial information, no

                                      -49-

<PAGE>

            representation or warranty is made pursuant to this Section 5.16
            except that such projections and similar forward-looking financial
            information were prepared in good faith based upon assumptions
            believed by management of Parent, Borrower, Servicer or such
            Originator, as the case may be, to be reasonable at the time of
            such preparation and on the date delivered to Agent and Lenders.

6.         AFFIRMATIVE COVENANTS.

                 Borrower covenants and agrees that, so long as any credit
            hereunder shall be available and until full and final payment of the
            Obligations and the termination of this Agreement, Borrower shall do
            all of the following:

                 6.1 ACCOUNTING SYSTEM. Maintain a system of accounting that
            enables Borrower to produce financial statements in accordance with
            GAAP and maintain records pertaining to the Collateral that contain
            information as from time to time reasonably may be requested by
            Agent.

                 6.2 COLLATERAL REPORTING. Provide Agent (with copies for each
            Lender) with the following documents at the following times in form
            satisfactory to the Lenders:

<TABLE>
<CAPTION>

=================================================================================================================

<S>                      <C>      <C>
Daily                       (a)      a statement of Accounts purchased pursuant to the Purchase Agreement, and

                            (b)      a statement of Collections
-----------------------------------------------------------------------------------------------------------------

Weekly (by the end of the
business day each           (c)      a detailed  calculation of  Collections  with respect to Accounts for the prior
Tuesday)                                                  week,

                            (d)      notice of all returns, disputes, or claims, and

                            (e)      the Purchase Report
                                     required under Section
                                     2.1 of the Purchase
                                     Agreement with respect
                                     to purchases and
                                     contributions of
                                     Accounts pursuant to
                                     the Purchase Agreement
                                     during the prior week,
                                     and

                            (f)      a detailed  calculation of the Borrowing Base (including detail regarding those
                                     Accounts that are not Eligible Accounts).
---------------------------------------------------------------------------------------------------------------------

Monthly (not later than the (g)      a detailed aging, by total, of the
10th Business Day                    Accounts, together with a reconciliation to
 of each month)                      the detailed calculation of the Borrowing
                                     Base previously provided to Agent,

                                      -51-

<PAGE>

                            (h)      a detailed aging of the accounts payable of
                                     each Originator,

                            (i)      a calculation of Dilution, A/R Turnover
                                     Period and the Delinquency Ratio for the
                                     prior month,

                            (j)      a calculation of Tangible Net Worth as of
                                     the end of the prior month, and

                            (k)      an updated Contract Trial Balance.

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

Quarterly                   (l)      a calculation of Consolidated Adjusted EBITDA and the Senior Debt Ratio,

                            (m)      a detailed list of Borrower's Account
                                     Debtors, and

                            (n)      a report regarding Borrower's accrued, but
                                     unpaid, AD VALOREM taxes.

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

Upon request by Agent       (o)      copies of invoices in connection  with the Accounts,  credit memos,  remittance
                                     advices,  deposit slips, shipping and delivery documents in connection with the
                                     Accounts, and

                            (p)      such other reports as to the Collateral, or
                                     the financial condition of Borrower, as
                                     Agent may request.

=====================================================================================================================
</TABLE>

                     In addition, Borrower agrees to cooperate fully with Agent
to facilitate and implement a system of electronic collateral reporting in order
to provide electronic reporting of each of the items set forth above.

            6.3 FINANCIAL STATEMENTS, REPORTS, CERTIFICATES. Deliver to Agent,
with copies to each Lender:

(a) as soon as available, but in any event within 30 days (45 days in the case
of a month that is the end of one of the first 3 fiscal quarters in a fiscal
year and 90 days in the case of a month that is the last month in a fiscal year)
after the end of each month during each of Borrower's fiscal years,

            (i) a company prepared balance sheet, income statement, and
       statement of cash flow covering each Originator's operations during such
       period,

            (ii) copies of each Originator's Projections, in form and substance
       (including as to scope and underlying assumptions) satisfactory to Agent,
       in its sole discretion, for the forthcoming three-month period, which
       Projections shall indicate Borrower's compliance with the financial
       covenants set forth in SECTION 7.20,

                                      -52-

<PAGE>

            (iii) a certificate signed by the chief financial officer of each
       Originator to the effect that:

                 (A) the financial statements delivered under clause (i) above
            have been prepared in accordance with GAAP (except for the lack of
            footnotes and being subject to year-end audit adjustments) and
            fairly present in all material respects the financial condition of
            such Originator, and,

                 (B) the Projections delivered under clause (ii) above
            constitute such officer's good faith best estimate of such
            Originator's financial performance during the period covered
            thereby;

            (iv) a certificate signed by the chief financial officer of Borrower
       to the effect that:

                 (A) the representations and warranties of Borrower contained in
            this Agreement and the other Transaction Documents are true and
            correct in all material respects on and as of the date of such
            certificate, as though made on and as of such date (except to the
            extent that such representations and warranties relate solely to an
            earlier date), and

                 (B) there does not exist any condition or event that
            constitutes a Default or Event of Default (or, to the extent of any
            non-compliance, describing such non-compliance as to which he or she
            may have knowledge and what action Borrower has taken, is taking, or
            proposes to take with respect thereto), and

            (v) for each month that is the date on which a financial covenant in
       SECTION 7.20 is to be tested, a Compliance Certificate demonstrating, in
       reasonable detail, compliance at the end of such period with the
       applicable financial covenants contained in SECTION 7.20,

            (b) as and when required under the Guaranty, the statements and
       certificates required pursuant to Section 7(b) thereof,

            (c) not later than [October 31] of each year, (i) copies of each
       Originator's Projections, in form and substance (including as to scope
       and underlying assumptions) satisfactory to Agent, in its sole
       discretion, for the forthcoming fiscal year, which Projections shall
       indicate Borrower's compliance with the financial covenants set forth in
       SECTION 7.20, and (ii) a certificate signed by the chief financial
       officer of each Originator to the effect that the Projections delivered
       under clause (i) above constitute such officer's good faith best estimate
       of such Originator's financial performance during the period covered
       thereby,

            (d) as soon as available, but in any event, not later then Thursday
       of each week, a statement of cash flow (indicating (i) the projected and
       actual receipts and disbursements and the unrestricted cash position for
       the immediately preceding week and (ii) the projected receipts and
       disbursements and unrestricted cash position for the following 10-14 week
       period) for (A) the Originators and (B) all domestic Subsidiaries of
       Parent, in each case using the Parent's standard "Domestic Liquidity
       Forecast",

                                      -53-

<PAGE>

            (e) if and when filed by Parent or FW LLC,

            (i) Form 10-Q quarterly reports, Form 10-K annual reports, and Form
       8-K current reports,

            (ii) any other filings made with the SEC,

            (iii) copies of such Person's federal income tax returns, and any
       amendments thereto, filed with the Internal Revenue Service, and

            (iv) any other information that is provided by Parent or FW LLC to
       its shareholders or to the holders of the public Indebtedness generally,

            (f) if and when filed by each Originator and as requested by Agent,
       satisfactory evidence of payment of applicable excise taxes in each
       jurisdictions in which (i) such Originator conducts business or is
       required to pay any such excise tax, (ii) where such Originator's failure
       to pay any such applicable excise tax would result in a Lien on any
       Purchased Accounts, or (iii) where such Originator's failure to pay any
       such applicable excise tax reasonably could reasonably be expected to
       result in a Material Adverse Change,

            (g) promptly after the commencement thereof, but in any event within
       five days after the service of process with respect thereto on Borrower,
       Servicer or any Originator, notice of all actions, suits or proceedings
       brought by or against any such Person before any Governmental Authority
       which, if determined adversely to such Person, could reasonably be
       expected to result in a Material Adverse Change,

            (h) as soon as Borrower has knowledge of any event or condition that
       constitutes a Default or an Event of Default, notice thereof and a
       statement of the curative action that Borrower proposes to take with
       respect thereto, and

            (i) upon the request of Agent, any other report reasonably requested
       relating to the financial condition of any Company.

            Borrower agrees that its independent certified public accountants
       are authorized to communicate with Agent and to release to Agent whatever
       financial information concerning Borrower Agent reasonably may request.
       Borrower waives the right to assert a confidential relationship, if any,
       it may have with any accounting firm or service bureau in connection with
       any information requested by Agent pursuant to or in accordance with this
       Agreement, and agrees that Agent may contact directly any such accounting
       firm or service bureau in order to obtain such information.

            6.4 SERVICER REPORTS. Cause Servicer to deliver its annual financial
       statements at the time when Borrower provides its audited financial
       statements to Agent and copies of all federal income tax returns as soon
       as the same are available and in any event no later than 30 days after
       the same are required to be filed by law.

                                   -54-

<PAGE>

            6.5 RETURN. Cause returns and allowances, as between Borrower and
       its Account Debtors, to be on the same basis and in accordance with the
       usual customary practices of Borrower, as they exist at the time of the
       execution and delivery of this Agreement.

            6.6 SEPARATE EXISTENCE. Borrower hereby acknowledges that the Agent
       and Lenders are entering into the transactions contemplated by this
       Agreement and the other Transaction Documents in reliance upon Borrower's
       identity as a legal entity separate from any other Company and its
       Affiliates. Therefore, from and after the date hereof, Borrower shall
       take all steps specifically required by this Agreement or reasonably
       required by Agent to continue Borrower's identity as a separate legal
       entity and to make it apparent to third Persons that Borrower is an
       entity with assets and liabilities distinct from those of the other
       Companies and any other Person, and is not a division of any other
       Company, its Affiliates or any other Person. Without limiting the
       generality of the foregoing and in addition to and consistent with the
       other covenants set forth herein, Borrower shall take such actions as
       shall be required in order that:

                 (a) Borrower will be a limited purpose corporation whose
            primary activities are restricted in its certificate of
            incorporation to: (i) purchasing or otherwise acquiring from the
            Originators, owning, holding, and collecting Subject Accounts, (ii)
            entering into agreements for the selling and servicing of the
            Purchased Accounts, and (iii) conducting such other activities as it
            deems necessary or appropriate to carry out its primary activities;

                 (b) Borrower shall not engage in any business or activity, or
            incur any Indebtedness or liability, other than as expressly
            permitted by the Transaction Documents;

                 (c) Not less than one member of Borrower's Board of Directors
            (the "Independent Director") shall be an individual who is not a
            direct, indirect or beneficial stockholder, officer, director,
            employee, affiliate, associate or supplier of any other Company or
            any of its Affiliates; accordingly, the certificate of incorporation
            of Borrower shall provide that: (i) Borrower's Board of Directors
            shall not approve, or take any other action to cause the filing of,
            a voluntary bankruptcy petition with respect to Borrower unless the
            Independent Director shall approve the taking of such action in
            writing before the taking of such action, and (ii) such provision
            cannot be amended without the prior written consent of the
            Independent Director;

                 (d) The Independent Director (to the extent such Independent
            Director is necessary pursuant to the immediately preceding
            paragraph) shall not at any time serve as a trustee in bankruptcy
            for Borrower, or any other Company or any Affiliate thereof;

                 (e) Any employee, consultant or agent of Borrower will be
            compensated from the Borrower's funds for services provided to
            Borrower. Borrower will not engage any agents other than its
            attorneys, auditors and other professionals, and a servicer and any
            other agent contemplated by the Transaction Documents for the
            Purchased Accounts, which servicer will be fully compensated for its
            services in accordance with the Servicing Agreement, and a manager,
            which manager will be fully compensated from the Seller's funds;

                                      -55-

<PAGE>

                 (f) Borrower will contract with Servicer to perform for
            Borrower all operations required on a daily basis to service the
            Purchased Accounts. Borrower will pay Servicer a servicing fee (the
            "Servicing Fee"); Borrower will not incur any material indirect or
            overhead expenses for items shared with any other Company (or any
            Affiliate thereof) that are not reflected in the Servicing Fee; to
            the extent, if any, that any other Company (or any Affiliate
            thereof) shares items of expenses not reflected in the Servicing Fee
            or the manager's fee, such as legal, auditing and other professional
            services, such expenses will be allocated to the extent practical on
            the basis of actual use or the value of services rendered, and
            otherwise on a basis reasonably related to the actual use or the
            value of services rendered; it being understood that Foster Wheeler,
            Inc. shall pay all expenses relating to the preparation,
            negotiation, execution and delivery of the Transaction Documents,
            including legal, agency and other fees;

                 (g) Borrower's operating expenses will not be paid by any other
            Company or any other Affiliate thereof;

                 (h) Borrower will have its own separate stationery;

                 (i) Borrower's books and records will be maintained separately
            from those of each other Company and any other Affiliate thereof;

                 (j) All financial statements of Parent or any Affiliate thereof
            that are consolidated to include Borrower will contain detailed
            notes clearly stating that: (i) Borrower, a special purpose
            corporation, exists as a Subsidiary of Parent, and (ii) the
            Originators have sold accounts receivable and other related assets
            to such special purpose Subsidiary;

                 (k) Borrower's assets will be maintained in a manner that
            facilitates their identification and segregation from those of each
            other Company or any Affiliate thereof;

                 (l) Borrower will strictly observe corporate formalities in its
            dealings with each other Company or any Affiliate thereof, and funds
            or other assets of Borrower will not be commingled with those of any
            other Company or any Affiliate thereof except as permitted by this
            Agreement in connection with servicing the Purchased Accounts.
            Borrower shall not maintain joint bank accounts or other depository
            accounts to which any other Company or any Affiliate thereof (other
            than Servicer) has independent access; Borrower is not named, and
            has not entered into any agreement to be named, directly or
            indirectly, as a direct or contingent beneficiary or loss payee on
            any insurance policy with respect to any loss relating to the
            property of any other Company or any other Affiliate of Parent;
            Borrower will pay to the appropriate Company the marginal increase
            or, in the absence of such increase, the market amount of its
            portion of the premium payable with respect to any insurance policy
            that covers Borrower and such Company; and

                                      -56-

<PAGE>

                 (m) Borrower will maintain arm's-length relationships with each
            other Company (and any Affiliate thereof); any Person that renders
            or otherwise furnishes services to Borrower will be compensated by
            Borrower at market rates for such services it renders or otherwise
            furnishes to Borrower; neither Borrower nor any other Company will
            be or will hold itself out to be responsible for the debts of the
            other or the decisions or actions respecting the daily business and
            affairs of the other; Borrower and each other Company will
            immediately correct any known misrepresentation with respect to the
            foregoing, and they will not operate or purport to operate as an
            integrated single economic unit with respect to each other or in
            their dealing with any other entity.

                 6.7 TAXES. Cause all assessments and taxes, whether real,
            personal, or otherwise, due or payable by, or imposed, levied, or
            assessed against Borrower or any of its assets to be paid in full,
            before delinquency or before the expiration of any extension period,
            except to the extent that the validity of such assessment or tax
            shall be the subject of a Permitted Protest. Borrower will make
            timely payment or deposit of all tax payments and withholding taxes
            required of it by applicable laws, including those laws concerning
            F.I.C.A., F.U.T.A., state disability, and local, state, and federal
            income taxes, and will, upon request, furnish Agent with proof
            satisfactory to Agent indicating that Borrower has made such
            payments or deposits. Borrower shall deliver satisfactory evidence
            of payment of applicable excise taxes in each jurisdictions in which
            Borrower is required to pay any such excise tax.

                 6.8 [INTENTIONALLY OMITTED]

                 6.9 COMPLIANCE WITH LAWS. Comply with the requirements of all
            applicable laws, rules, regulations, and orders of any Governmental
            Authority, including the Fair Labor Standards Act and the Americans
            With Disabilities Act, other than laws, rules, regulations, and
            orders the non-compliance with which, individually or in the
            aggregate, would not result in and reasonably could not reasonably
            be expected to result in a Material Adverse Change.

                 6.10 LEASES. Pay when due all rents and other amounts payable
            under any leases to which Borrower is a party or by which Borrower's
            properties and assets are bound, unless such payments are the
            subject of a Permitted Protest.

                 6.11 BROKERAGE COMMISSIONS. Pay any and all brokerage
            commission or finders fees incurred in connection with or as a
            result of Borrower's obtaining financing from the Lender Group under
            this Agreement. Borrower agrees and acknowledges that payment of all
            such brokerage commissions or finders fees shall be the sole
            responsibility of Borrower, and Borrower agrees to indemnify,
            defend, and hold Agent and the Lender Group harmless from and
            against any claim of any broker or finder arising out of Borrower's
            obtaining financing from the Lender Group under this Agreement.

                 6.12 EXISTENCE. At all times preserve and keep in full force
            and effect Borrower's valid existence and good standing in the
            jurisdiction in which it is organized and any rights and franchises
            material to Borrower's businesses.

                 6.13 DISCLOSURE UPDATES. Promptly and in no event later than 5
            Business Days after obtaining knowledge thereof, (a) notify Agent if
            any written information, exhibit, or report furnished to the Lender
            Group contained any untrue statement of a material fact or omitted
            to state any material fact necessary to make the statements
            contained therein not misleading in light of the circumstances in
            which made, and (b) correct any defect or error that may be
            discovered therein or in any Transaction Document or in the
            execution, acknowledgement, filing, or recordation thereof.

                                      -57-

<PAGE>

                 6.14 PURCHASES. Purchase or receive as a contribution all
            Subject Accounts created at any time by any Originator in accordance
            with the Purchase Agreement, PROVIDED that (a) all Subject Accounts
            that are not Eligible Subject Accounts shall be received as a
            contribution, (b) at least 85% of the purchase price for all
            Eligible Subject Accounts shall be paid in cash, (c) the portion of
            such purchase price constituting Indebtedness, which shall not
            exceed 15%, shall be evidenced by a Subordinated Note, and (d) no
            Eligible Subject Account shall be purchased if, at the time of the
            proposed purchase, the sum of Availability plus the Borrower's cash
            is less than 85% of the purchase price of such Eligible Subject
            Accounts.

                 7. NEGATIVE COVENANTS.

            Borrower covenants and agrees that, so long as any credit hereunder
shall be available and until full and final payment of the Obligations and the
termination of this Agreement, Borrower will not do any of the following:

            7.1 INDEBTEDNESS. Create, incur, assume, permit, guarantee, or
otherwise become or remain, directly or indirectly, liable with respect to any
Indebtedness, except:

                 (a) Indebtedness evidenced by this Agreement and the other Loan
            Documents, and

                 (b) Indebtedness evidenced by the Subordinated Note.

            7.2 LIENS. Create, incur, assume, or permit to exist, directly or
indirectly, any Lien on or with respect to any of its assets, of any kind,
whether now owned or hereafter acquired, or any income or profits therefrom,
except for Permitted Liens.

            7.3 RESTRICTIONS ON CHANGES.

                 (a) Enter into any merger, consolidation, reorganization, or
            recapitalization, or reclassify its Stock.

                 (b) Liquidate, wind up, or dissolve itself (or suffer any
            liquidation or dissolution).

                 (c) Form or acquire any Subsidiary.

                 (d) Acquire any property or assets other than Permitted Assets.

                 (e) Make any material change in the Credit and Collection
            Policy without the prior written consent of the Agent (which consent
            shall not be unreasonably withheld or delayed), make any change in
            the Credit and Collection Policy that would result in a Material
            Adverse Change with respect to the Accounts, or make (or permit any
            Originator to make) any other change in the Credit and Collection
            Policy without giving prior written notice thereof to Agent.

                                      -58-

<PAGE>

            7.4 DISPOSAL OF ASSETS. Other than Permitted Dispositions, convey,
sell, lease, license, assign, transfer, or otherwise dispose of any of
Borrower's assets.

            7.5 CHANGE NAME. Change Borrower's name, FEIN, corporate structure,
or identity, or add any new fictitious name.

            7.6 GUARANTEE. Guarantee or otherwise become in any way liable with
respect to the obligations of any third Person except by endorsement of
instruments or items of payment for deposit to the account of Borrower or which
are transmitted or turned over to Agent.

            7.7 NATURE OF BUSINESS. Conduct any business other than the
purchase, ownership and collection of Subject Accounts in accordance with the
Purchase Agreement; provided, HOWEVER, that Borrower shall be permitted to incur
minimal obligations to the extent necessary for the day-to-day operations of
Borrower (such as expenses for stationery, audits, maintenance of legal status,
etc.).

            7.8 PREPAYMENTS AND AMENDMENTS.

                 (a) Agree to, consent to or otherwise permit any amendment,
supplement or other modification to the Purchase Agreement, the Subordinated
Note or (unless consented to by Agent) the Servicing Agreement,

                 (b) Prepay, redeem, defease, purchase, or otherwise acquire any
Indebtedness under the Subordinated Note or, except to the extent expressly
permitted under the Servicing Agreement, pay any Servicing Fee under the
Servicing Agreement, or

                 (c) Directly or indirectly, amend, modify, alter, increase, or
change any of the terms or conditions of the Subordinated Note or the
Indebtedness evidenced thereby or the terms or conditions of the Servicing
Agreement or of the Servicing Fee payable thereunder.

            7.9 CHANGE OF CONTROL. Cause, permit, or suffer, directly or
indirectly, any Change of Control.

            7.10 COMPROMISE OF ACCOUNTS. Compromise or adjust any Account (or
extend the time of payment thereof) or grant any discounts, allowances or
credits other than, provided no Default or Event of Default has occurred and is
continuing, in the ordinary course of its business and consistent with the
Credit and Collection Policy.

            7.11 DISTRIBUTIONS. Make any distribution or declare or pay any
dividends (in cash or other property, other than common Stock) on, or purchase,
acquire, redeem, or retire any of Borrower's Stock, of any class, whether now or
hereafter outstanding, PROVIDED that Borrower may make distributions or declare
and pay dividends not more often than twice during any calendar week if, both
immediately before and immediately after giving effect to such distribution or
payment, (a) no Default or Event of Default shall have occurred and be
continuing and (b) the Borrower has aggregate Availability and/or cash in an
amount of not less than $5,000,000.

                                      -59-

<PAGE>

            7.12 ACCOUNTING METHODS. Modify or change its method of accounting
(other than as may be required to conform to GAAP) or enter into, modify, or
terminate any agreement currently existing, or at any time hereafter entered
into with any third party accounting firm or service bureau for the preparation
or storage of Borrower's accounting records without said accounting firm or
service bureau agreeing to provide Agent information regarding the Collateral or
Borrower's financial condition.

            7.13 INVESTMENTS. Except for Permitted Investments, directly or
indirectly, make or acquire any Investment or incur any liabilities (including
contingent obligations) for or in connection with any Investment; PROVIDED,
HOWEVER, that (i) the Borrower may make loans or advances to the Originators not
more often than twice during any calendar week if (A) both immediately before
and after giving effect to any such loans or advances (x) no Default or Event of
Default shall have occurred and be continuing and (y) the Borrower has aggregate
Availability and/or cash in an amount of not less than $5,000,000, and (B) Agent
has received a certificate executed by an Authorized Person of Borrower,
certifying that such loan or advance is being made in compliance with the Senior
Indenture and that, after giving effect to the making of such loan or advance,
the aggregate outstanding amount of Debt of the Restricted Subsidiaries,
excluding all Secured Debt and Attributable Debt in respect of sale and
leaseback transactions, will not exceed 10% of Consolidated Net Tangible Assets
(as the terms "Debt", "Restricted Subsidiaries", "Secured Debt", "Attributable
Debt" and "Consolidated Net Tangible Assets" are defined in the Senior
Indenture), and (ii) except as provided in (i) above, Borrower shall not have
Permitted Investments (other than in the Cash Management Accounts) outstanding
at any time unless Borrower and the applicable securities intermediary or bank
have entered into Control Agreements governing such Permitted Investments, as
Agent shall determine in its Permitted Discretion, to perfect (and further
establish) the Agent's Liens in such Permitted Investments.

            7.14 TRANSACTIONS WITH AFFILIATES. Directly or indirectly enter into
or permit to exist any transaction with any Affiliate of Borrower except for
transactions that are expressly permitted hereunder and are in the ordinary
course of Borrower's business, upon fair and reasonable terms, that are fully
disclosed to Agent, and that are no less favorable to Borrower than would be
obtained in an arm's length transaction with a non-Affiliate.

            7.15 SUSPENSION. Suspend or go out of a substantial portion of its
business.

            7.16 [INTENTIONALLY OMITTED].

            7.17 USE OF PROCEEDS. Use the proceeds of the Advances for any
purpose other than (i) to finance the purchase of Eligible Subject Accounts in
accordance with the Purchase Agreement, and (ii) to pay transactional fees,
costs, and expenses incurred in connection with this Agreement, the other
Transaction Documents, and the transactions contemplated hereby and thereby.

            7.18 CHANGE IN LOCATION OF CHIEF EXECUTIVE OFFICE. Relocate its
chief executive office to a new location without providing 30 days prior written
notification thereof to Agent and so long as, at the time of such written
notification, Borrower provides any financing statements necessary to perfect
and continue perfected the Agent's Liens and also provides to Agent a Collateral
Access Agreement with respect to such new location.

                                      -60-

<PAGE>

            7.19 SECURITIES ACCOUNTS. Establish or maintain any Securities
Account unless Agent shall have received a Control Agreement in respect of such
Securities Account. Borrower shall not transfer assets out of any Securities
Account; PROVIDED, HOWEVER, that, so long as no Default or Event of Default has
occurred and is continuing or would result therefrom, Borrower may use such
assets (and the proceeds thereof) to the extent not prohibited by this
Agreement.

            7.20 FINANCIAL COVENANTS.

            (a) Permit:

(i)        MINIMUM COLLECTIONS. As of the end of any week, the average amount of
           the weekly Collections with respect to Borrower's Accounts during the
           Testing Period ending at the end of such week to be less than
           $15,000,000; PROVIDED, HOWEVER, that the calculation of weekly
           Collections determined under this SECTION 7.20(A)(I) shall include
           all amounts not exceeding $4,000,000 paid to subcontractors for goods
           and/or services that, pursuant to the terms of any commercial
           contract between an Originator and its clients, such Originator pays
           such subcontractor (on behalf of, and as agent for, such client)
           directly from the clients' funds;

(ii)       MINIMUM PURCHASES. As of the end of any week, the average amount of
           Subject Accounts purchased by, or contributed to, Borrower each week
           pursuant to the Purchase Agreement during the Testing Period ending
           at the end of such week to be less than $18,000,00; PROVIDED,
           HOWEVER, that the calculation of weekly purchases and contributions
           determined under this SECTION 7.20(A)(II) shall include amounts not
           exceeding $4,000,000 invoiced by any Originator for subcontractor
           services for which, pursuant to the terms of a commercial contract
           between such Originator and its client, such Originator acts as agent
           for the client and pays for subcontractor goods and services directly
           from the client's funds;

            (iii) DILUTION. Dilution for any six-month period, measured each
month for the six-month period ending as of the last day of such month, to
exceed 18%;

            (iv) A/R TURNOVER PERIOD. The A/R Turnover Period for any month,
measured as of the last day of such month, to exceed 80 days;

            (v) DELINQUENCY RATIO. The Delinquency Ratio at any time to exceed
50%;

            (vi) TANGIBLE NET WORTH. Tangible Net Worth at any time to be less
than $5,000,000;

            (b) Permit:

                                      -61-

<PAGE>

            (i) MINIMUM EBITDA. On and after March 31, 2003, Consolidated
Adjusted EBITDA for any fiscal period set forth below to be less than the
applicable amount set forth below under the heading "Minimum Amount":

<TABLE>
<CAPTION>

                      FISCAL PERIOD                                  MINIMUM AMOUNT             FLOOR AMOUNT
                      -------------                                  --------------             ------------
<S>                                                            <C>                          <C>
           Four Fiscal Quarters ended closest to 3/31/03             $ 81,700,000                 $62,846,000
           Four Fiscal Quarters ended closest to 6/30/03             $ 92,417,000                 $71,090,000
           Four Fiscal Quarters ended closest to 9/30/03             $101,378,000                 $77,983,000
           Four Fiscal Quarters ended closest to 12/31/03            $101,726,000                 $78,251,000
           Four Fiscal Quarters ended closest to 3/31/04             $111,693,000                 $85,918,000
           Four Fiscal Quarters ended closest to 6/30/04             $121,660,000                 $93,585,000
           Four Fiscal Quarters ended closest to 9/30/04             $131,627,000                 $101,252,000
           Four Fiscal Quarters ended closest to 12/31/04            $141,594,000                 $108,918,000
           Four Fiscal Quarters ended closest to 3/31/05             $143,243,000                 $110,187,000

</TABLE>

(ii)       SENIOR DEBT RATIO. From and after March 31, 2003, the Senior Debt
           Ratio, at any date during any period set forth below, to be more than
           the applicable ratio set forth below opposite such period under the
           heading "Maximum Ratio":

<TABLE>
<CAPTION>

                                     FISCAL PERIOD                                   MAXIMUM RATIO               CEILING AMOUNT
                                     -------------                                   -------------               --------------
<S>                                                                           <C>                          <C>
           The last day of the Fiscal Quarter ended closest to 3/31/03                   6.05                         7.80
           through the day before the last day of the Fiscal Quarter ended
           closest to 6/30/03

           The last day of the Fiscal Quarter ended closest to 6/30/03                   5.35                         6.90
           through the day before the last day of the Fiscal Quarter ended
           closest to 9/30/03

           The last day of the Fiscal Quarter ended closest to 9/30/03                    4.85                        6.30
           through the day before the last day of the Fiscal Quarter ended
           closest to 12/31/03

           The last day of the Fiscal Quarter ended closest to 12/31/03                  4.85                         6.25
           through the day before the last day of the Fiscal Quarter ended
           closest to 3/31/04

           The last day of the Fiscal Quarter ended closest to 3/31/04                   4.40                         5.70
           through the day before the last day of the Fiscal Quarter ended
           closest to 6/30/04

                                      -62-

<PAGE>

                                     FISCAL PERIOD                                   MAXIMUM RATIO               CEILING AMOUNT
                                     -------------                                   -------------               --------------

           The last day of the Fiscal Quarter ended closest to 6/30/04                   4.05                         5.25
           through the day before the last day of the Fiscal Quarter ended
           closest to 9/30/04

           The last day of the Fiscal Quarter ended closest to 9/30/04                   3.75                         4.85
           through the day before the last day of the Fiscal Quarter ended
           closest to 12/31/04

           The last day of the Fiscal Quarter ended closest to 12/31/04                  3.50                         4.50
           through the day before the last day of the Fiscal Quarter ended
           closest to 3/31/05

           The last day of the Fiscal Quarter ended closest to 3/31/05                   3.45                         4.45
           through the day before the last day of the Fiscal Quarter ended
           closest to 6/30/05

</TABLE>

                 (iii) ADJUSTMENTS. In the event of any Asset Sale the
            compliance levels specified in subparagraphs (i) and (ii) of this
            paragraph (b) for each period ending on or after the date of
            consummation of such Asset Sale shall be adjusted as determined
            jointly by Borrower and Agent. Such determination shall be based
            upon (A) with respect to Consolidated Adjusted EBITDA, for purposes
            of both paragraphs (i) and (ii) above, a reduction for the
            contribution of the assets or entity which was the subject of such
            Asset Sale to the business plan as presented by FW LLC on May 9,
            2002, adjusted for the cushion (35% in 2003 and 30% thereafter)
            utilized in the initial determination of the minimum amounts
            specified in paragraphs (i) and (ii) above and (B) with respect to
            Senior Debt for purposes of paragraph (ii) above, an adjustment
            based on the amount of the actual reduction of the Credit Exposures
            (as defined in the Existing Credit Agreement) and the notes issued
            under the Senior Indenture required pursuant to Section 2.12(b) of
            the Existing Credit Agreement by reason of such Asset Sale. Agent
            shall promptly notify the Lenders of each such adjustment.

                 (iv) Notwithstanding anything to the contrary contained herein,
            if at any time and from time to time, after the date hereof (i) any
            of the financial covenants in the Existing Credit Agreement
            corresponding to the Specified Financial Covenants or any definition
            or term used in such covenants in the Existing Credit Agreement
            (collectively, the "Existing Credit Agreement Specified Covenants")
            is amended, modified, supplemented or waived and (ii) the Borrower
            remains in compliance with the Specified Financial Covenants using
            the "Floor Amount" in the case of the Minimum EBITDA in Section
            7.20(b)(i) and using the "Ceiling Amount" in the case of the Senior
            Debt Ratio in Section 7.20(b)(ii), the Agent and the Lenders agree
            to amend, modify, supplement or waive the Specified Financial
            Covenants and any definition or term used in the Specified Financial
            Covenants (collectively, the "Specified Provisions"), on the same
            basis and to the same extent that the Existing Credit Agreement
            Specified Covenants are amended, modified, supplement or waived. The
            only conditions to any such amendment, modification, supplement or

                                      -63-

<PAGE>

            waiver of the Specified Provisions based upon an amendment,
            modification, supplement or waiver of the Existing Credit Agreement
            Specified Covenants shall be (A) the receipt by the Agent and the
            Lenders of a fully-executed copy of the amendment, modification,
            supplement or waiver of the Existing Credit Agreement Specified
            Covenants that contain no conditions to its effectiveness other than
            the effectiveness of the corresponding amendment, modification,
            supplement or waiver of the Specified Provisions, (B) the receipt by
            the Agent and the Lenders of the same pro rata consideration as
            received or to be received by the agent and the lenders under the
            Existing Credit Agreement in connection with the amendment,
            modification, supplement or waiver of the Existing Credit Agreement
            Specified Covenants and (C) the execution and delivery by the Agent
            and the Borrower of the amendment, modification, supplement or
            waiver to the Specified Provisions incorporating the same terms and
            conditions as the amendment, modification, supplement or waiver of
            the Existing Credit Agreement Specified Covenants. Each of the
            Agent, the Lenders and the Borrower hereby agrees to execute and
            deliver all such documents required to reflect any amendment,
            modification, supplement or waiver to the Specified Covenants
            required by this Section 7.20(b)(iv).

                 (c) Make Capital Expenditures at any time.

8.         EVENTS OF DEFAULT.

                     Any one or more of the following events shall constitute an
event of default (each, an "Event of Default") under this Agreement:

            8.1 If Borrower fails to pay when due and payable, or when declared
due and payable, all or any portion of the Obligations (whether of principal,
interest in accordance with SECTION 2.6(D) (including any interest which, but
for the provisions of the Bankruptcy Code, would have accrued on such amounts),
fees and charges due the Lender Group, reimbursement of Lender Group Expenses,
or other amounts constituting Obligations);

            8.2 If Borrower fails to perform, keep, or observe any term,
provision, condition, covenant, or agreement contained in (i) SECTION 6.1, 6.4,
6.5 or 6.13 and such failure continues for five days, (ii) clause (a) or (b) of
SECTION 6.2 and such failure continues for more than one (1) day, (iii) clause
(c), (d), (e) or (f) of SECTION 6.2 and such failure continues for a period of
two (2) days, (iv) any other clause of SECTION 6.2 or SECTION 6.3 (but only up
to three times during any 12-month period) and such failure continues for a
period of three (3) days, or (v) any other provision of this Agreement or in any
of the other Transaction Documents;

            8.3 If any material portion of Borrower's assets is attached,
seized, subjected to a writ or distress warrant, levied upon, or comes into the
possession of any third Person;

            8.4 If an Insolvency Proceeding is commenced by Borrower, Servicer,
any Originator or Parent;

            8.5 If an Insolvency Proceeding is commenced against Borrower,
Servicer, any Originator or Parent, and any of the following events occur: (a)
Borrower, Servicer, such Originator or Parent (as applicable) consents to the
institution of such Insolvency Proceeding against it, (b) the petition
commencing the Insolvency Proceeding is not timely controverted, (c) the
petition commencing the Insolvency Proceeding is not dismissed within 45
calendar days of the date of the filing thereof; PROVIDED, HOWEVER, that, during
the pendency of such period, Agent (including any successor agent) and each
other member of the Lender Group shall be relieved of their obligations to
extend credit hereunder, (d) an interim trustee is appointed to take possession
of all or any substantial portion of the properties or assets of, or to operate
all or any substantial portion of the business of, Borrower, Servicer, such
Originator or Parent, or (e) an order for relief shall have been entered
therein;

                                      -64-

<PAGE>

            8.6 If Borrower, Servicer, any Originator or Parent is enjoined,
restrained, or in any way prevented by court order from continuing to conduct
all or any material part of its business affairs;

            8.7 If a notice of Lien, levy, or assessment is filed of record with
respect to any of Borrower's assets by the United States, or any department,
agency, or instrumentality thereof, or by any state, county, municipal, or
governmental agency, or if any taxes or debts owing at any time hereafter to any
one or more of such entities becomes a Lien, whether choate or otherwise, upon
any of Borrower's assets and the same is not paid before such payment is
delinquent;

            8.8 If a judgment or other claim becomes a Lien or encumbrance upon
any material portion of Borrower's or any Originator's assets and, in the case
of any Originator, enforcement of such judgment remains unstayed for a period of
30 consecutive days;

            8.9 If there is a default in any material agreement (including,
without limitation, the Servicing Agreement, the Purchase Agreement and the
Subordinated Note) to which Borrower or Servicer is a party and such default (a)
occurs at the final maturity of the obligations thereunder, or (b) results in a
right by the other party thereto, irrespective of whether exercised, to
accelerate the maturity of Borrower's or Servicer's obligations thereunder, to
terminate such agreement, or to refuse to renew such agreement pursuant to an
automatic renewal right therein;

            8.10 If Borrower makes any payment on account of the Subordinated
Note or of the Servicing Fee pursuant to the Servicing Agreement, except, in
each case, to the extent such payment is permitted by the terms hereof and
thereof;

            8.11 If any material misstatement or misrepresentation exists now or
hereafter in any warranty, representation, statement, or Record made to the
Lender Group by Borrower, Servicer or any Originator, or any officer, employee,
agent, or director of Borrower, Servicer or Originator;

            8.12 If this Agreement or any other Loan Document that purports to
create a Lien, shall, for any reason, fail or cease to create a valid and
perfected and, except to the extent permitted by the terms hereof or thereof,
first priority Lien on or security interest in the Collateral covered hereby or
thereby;

            8.13 (a) Any provision of any Transaction Document shall at any time
for any reason be declared to be null and void, or the validity or
enforceability thereof shall be contested by any Company, or a proceeding shall
be commenced by any Company, or by any Governmental Authority having
jurisdiction over Parent, Borrower, Servicer or any Originator, seeking to
establish the invalidity or unenforceability thereof, or Parent, Borrower,
Servicer or any Originator, shall deny that such Person has any liability or
obligation purported to be created under any Transaction Document; or

            (b) any Company shall deny that the sale of the Eligible Subject
Accounts pursuant to the Purchase Agreement should be treated as a "true sale"
for any reason or a proceeding shall be commenced by any Company, or by any
Governmental Authority having jurisdiction over Parent, Borrower, Servicer or
any Originator, seeking to establish that the sale of the Subject Accounts
pursuant to the Purchase Agreement should not be treated as a "true sale" for
any reason;

                                      -65-

<PAGE>

            8.14 Parent or any Originator shall fail to pay any principal of or
interest on any of its Indebtedness in excess of $10,000,000, or any interest or
premium thereon, when due (whether by scheduled maturity, required prepayment,
acceleration, demand or otherwise) and such failure shall continue after the
applicable grace period, if any, specified in the agreement or instrument
relating to such Indebtedness, or any other default under any agreement or
instrument relating to any such Indebtedness, or any other event, shall occur
and shall continue after the applicable grace period, if any, specified in such
agreement or instrument, if the effect of such default or event is to
accelerate, or to permit the acceleration of, the maturity of such Indebtedness;
or any such Indebtedness shall be declared to be due and payable, or required to
be prepaid (other than by a regularly scheduled required prepayment), redeemed,
purchased or defeased or an offer to prepay, redeem, purchase or defease such
Indebtedness shall be required to be made, in each case, prior to the stated
maturity thereof; or

            8.15 On any Business Day on which Eligible Subject Accounts are
available to be purchased by Borrower under the Purchase Agreement, the sum of
Availability plus Borrower's cash is less than 85% of the aggregate purchase
price of such Eligible Subject Accounts and such shortfall shall continue for a
period of three (3) Business Days.

            Anything to the contrary contained herein notwithstanding, in the
event that an Event of Default shall have occurred and be continuing solely by
reason of the occurrence of a Single Originator Default, then Agent and Lenders
shall, upon the written request of Borrower, waive such Event of Default,
PROVIDED that (a) no Event of Default, other than such Single Originator
Default, shall have occurred and be continuing, (b) after excluding from the
Eligible Accounts and the Borrowing Base all Subject Accounts which were
purchased by the Borrower from the Originator involved in such Single Originator
Default, aggregate Availability and/or cash is not less than $5,000,000, and (c)
Borrower may request such waiver only once during the term of this Agreement.

            9. THE LENDER GROUP'S RIGHTS AND REMEDIES.

            9.1 RIGHTS AND REMEDIES. Upon the occurrence, and during the
continuation, of an Event of Default, the Required Lenders (at their election
but without notice of their election and without demand) may authorize and
instruct Agent to do any one or more of the following on behalf of the Lender
Group (and Agent, acting upon the instructions of the Required Lenders, shall do
the same on behalf of the Lender Group), all of which are authorized by
Borrower:

                                      -66-

<PAGE>

            (a) Declare all Obligations, whether evidenced by this Agreement, by
any of the other Loan Documents, or otherwise, immediately due and payable;

            (b) Cease advancing money or extending credit to or for the benefit
of Borrower under this Agreement, under any of the Loan Documents, or under any
other agreement between Borrower and the Lender Group;

            (c) Terminate this Agreement and any of the other Loan Documents as
to any future liability or obligation of the Lender Group, but without affecting
any of the Agent's Liens in the Collateral and without affecting the
Obligations;

            (d) Settle or adjust disputes and claims directly with Account
Debtors for amounts and upon terms which Agent considers advisable, and in such
cases, Agent will credit Borrower's Loan Account with only the net amounts
received by Agent in payment of such disputed Accounts after deducting all
Lender Group Expenses incurred or expended in connection therewith;

            (e) [Intentionally Omitted]

            (f) Without notice to or demand upon Borrower, make such payments
and do such acts as Agent considers necessary or reasonable to protect its
security interests in the Collateral. Borrower agrees to assemble the Collateral
if Agent so requires, and to make the Collateral available to Agent at a place
that Agent may designate which is reasonably convenient to both parties.
Borrower authorizes Agent to enter the premises where the Collateral is located,
to take and maintain possession of the Collateral, or any part of it, and to
pay, purchase, contest, or compromise any Lien that in Agent's determination
appears to conflict with the Agent's Liens and to pay all expenses incurred in
connection therewith and to charge Borrower's Loan Account therefor. With
respect to any of Borrower's owned or leased premises, Borrower hereby grants
Agent a license to enter into possession of such premises and to occupy the
same, without charge, in order to exercise any of the Lender Group's rights or
remedies provided herein, at law, in equity, or otherwise;

            (g) Without notice to Borrower (such notice being expressly waived),
and without constituting a retention of any collateral in satisfaction of an
obligation (within the meaning of the Code), set off and apply to the
Obligations any and all (i) balances and deposits of Borrower held by the Lender
Group (including any amounts received in the Cash Management Accounts), or (ii)
Indebtedness at any time owing to or for the credit or the account of Borrower
held by the Lender Group;

            (h) Hold, as cash collateral, any and all balances and deposits of
Borrower held by the Lender Group, and any amounts received in the Cash
Management Accounts, to secure the full and final repayment of all of the
Obligations;

            (i) Ship, reclaim, recover, store, finish, maintain, repair, prepare
for sale, advertise for sale, and sell (in the manner provided for herein) the
Collateral. Borrower hereby grants to Agent a license or other right to use,
without charge, Borrower's labels, patents, copyrights, trade secrets, trade
names, trademarks, service marks, and advertising matter, or any property of a
similar nature, as it pertains to the Collateral, in completing production of,
advertising for sale, and selling any Collateral and Borrower's rights under all
licenses and all franchise agreements shall inure to the Lender Group's benefit;

                                      -67-

<PAGE>

            (j) Sell the Collateral at either a public or private sale, or both,
by way of one or more contracts or transactions, for cash or on terms, in such
manner and at such places (including Borrower's premises) as Agent determines is
commercially reasonable. It is not necessary that the Collateral be present at
any such sale;

            (k) Agent shall give notice of the disposition of the Collateral as
follows:

            (i) Agent shall give Borrower a notice in writing of the time and
place of public sale, or, if the sale is a private sale or some other
disposition other than a public sale is to be made of the Collateral, the time
on or after which the private sale or other disposition is to be made; and

            (ii) The notice shall be personally delivered or mailed, postage
prepaid, to Borrower as provided in SECTION 12, at least 10 days before the
earliest time of disposition set forth in the notice; no notice needs to be
given prior to the disposition of any portion of the Collateral that is
perishable or threatens to decline speedily in value or that is of a type
customarily sold on a recognized market;

            (l) Agent, on behalf of the Lender Group, may credit bid and
purchase at any public sale; and

            (m) Agent may seek the appointment of a receiver or keeper to take
possession of all or any portion of the Collateral or to operate same and, to
the maximum extent permitted by law, may seek the appointment of such a receiver
without the requirement of prior notice or a hearing;

            (n) The Lender Group shall have all other rights and remedies
available at law or in equity or pursuant to any other Loan Document; and

            (o) Any deficiency that exists after disposition of the Collateral
as provided above will be paid immediately by Borrower. Any excess will be
returned, without interest and subject to the rights of third Persons, by Agent
to Borrower.

            9.2 REMEDIES CUMULATIVE. The rights and remedies of the Lender Group
under this Agreement, the other Loan Documents, and all other agreements shall
be cumulative. The Lender Group shall have all other rights and remedies not
inconsistent herewith as provided under the Code, by law, or in equity. No
exercise by the Lender Group of one right or remedy shall be deemed an election,
and no waiver by the Lender Group of any Event of Default shall be deemed a
continuing waiver. No delay by the Lender Group shall constitute a waiver,
election, or acquiescence by it.

                                      -68-

<PAGE>

            10. TAXES AND EXPENSES.

            If Borrower fails to pay any monies (whether taxes, assessments,
insurance premiums, or, in the case of leased properties or assets, rents or
other amounts payable under such leases) due to third Persons, or fails to make
any deposits or furnish any required proof of payment or deposit, all as
required under the terms of this Agreement and except, in the case of
assessments and taxes, to the extent that the validity of such assessment or tax
shall be the subject of a Permitted Protest, then, Agent, in its sole discretion
and without prior notice to Borrower, may do any or all of the following: (a)
make payment of the same or any part thereof, (b) set up such reserves in
Borrower's Loan Account as Agent deems necessary to protect the Lender Group
from the exposure created by such failure, or (c) in the case of the failure to
comply with SECTION 6.8 hereof, obtain and maintain insurance policies of the
type described in SECTION 6.8 and take any action with respect to such policies
as Agent deems prudent. Any such amounts paid by Agent shall constitute Lender
Group Expenses and any such payments shall not constitute an agreement by the
Lender Group to make similar payments in the future or a waiver by the Lender
Group of any Event of Default under this Agreement. Agent need not inquire as
to, or contest the validity of, any such expense, tax, or Lien and the receipt
of the usual official notice for the payment thereof shall be conclusive
evidence that the same was validly due and owing.

11.        WAIVERS; INDEMNIFICATION.

            11.1 DEMAND; PROTEST; ETC. Borrower waives demand, protest, notice
of protest, notice of default or dishonor, notice of payment and nonpayment,
nonpayment at maturity, release, compromise, settlement, extension, or renewal
of documents, instruments, chattel paper, and guarantees at any time held by the
Lender Group on which Borrower may in any way be liable.

            11.2 THE LENDER GROUP'S LIABILITY FOR COLLATERAL. Borrower hereby
agrees that: (a) so long as Agent complies with its obligations, if any, under
the Code, the Lender Group shall not in any way or manner be liable or
responsible for: (i) the safekeeping of the Collateral, (ii) any loss or damage
thereto occurring or arising in any manner or fashion from any cause, (iii) any
diminution in the value thereof, or (iv) any act or default of any carrier,
warehouseman, bailee, forwarding agency, or other Person; and (b) all risk of
loss, damage, or destruction of the Collateral shall be borne by Borrower.

            11.3 INDEMNIFICATION. Borrower shall pay, indemnify, defend, and
hold the Agent-Related Persons, the Lender-Related Persons with respect to each
Lender, each Participant, and each of their respective officers, directors,
employees, agents, and attorneys-in-fact (each, an "Indemnified Person")
harmless (to the fullest extent permitted by law) from and against any and all
claims, demands, suits, actions, investigations, proceedings, and damages, and
all reasonable attorneys fees and disbursements and other costs and expenses
actually incurred in connection therewith (as and when they are incurred and
irrespective of whether suit is brought), at any time asserted against, imposed
upon, or incurred by any of them (a) in connection with or as a result of or
related to the execution, delivery, enforcement, performance, or administration
of this Agreement, any of the other Transaction Documents, or the transactions
contemplated hereby or thereby, and (b) with respect to any investigation,
litigation, or proceeding related to this Agreement, any other Transaction

                                      -69-

<PAGE>

Document, or the use of the proceeds of the credit provided hereunder
(irrespective of whether any Indemnified Person is a party thereto), or any act,
omission, event, or circumstance in any manner related thereto (all the
foregoing, collectively, the "Indemnified Liabilities"). The foregoing to the
contrary notwithstanding, Borrower shall have no obligation to any Indemnified
Person under this SECTION 11.3 with respect to any Indemnified Liability that a
court of competent jurisdiction finally determines to have resulted from the
gross negligence or willful misconduct of such Indemnified Person. This
provision shall survive the termination of this Agreement and the repayment of
the Obligations. If any Indemnified Person makes any payment to any other
Indemnified Person with respect to an Indemnified Liability as to which Borrower
was required to indemnify the Indemnified Person receiving such payment, the
Indemnified Person making such payment is entitled to be indemnified and
reimbursed by Borrower with respect thereto. WITHOUT LIMITATION, THE FOREGOING
INDEMNITY SHALL APPLY TO EACH INDEMNIFIED PERSON WITH RESPECT TO INDEMNIFIED
LIABILITIES WHICH IN WHOLE OR IN PART CAUSED BY OR ARISE OUT OF ANY NEGLIGENT
ACT OR OMISSION OF SUCH INDEMNIFIED PERSON OR OF ANY OTHER PERSON.

            12. NOTICES.

            Unless otherwise provided in this Agreement, all notices or demands
by Borrower or Agent to the other relating to this Agreement or any other
Transaction Document shall be in writing and (except for financial statements
and other informational documents which may be sent by first-class mail, postage
prepaid) shall be personally delivered or sent by registered or certified mail
(postage prepaid, return receipt requested), overnight courier, electronic mail
(at such email addresses as Borrower or Agent, as applicable, may designate to
each other in accordance herewith), or telefacsimile to Borrower or Agent, as
the case may be, at its address set forth below:

          If to Borrower:     FOSTER WHEELER FUNDING LLC
                              Perryville Corporate Park
                              Clinton, NJ  08809
                              Attn:  Robert Iseman, Chief Financial Officer
                              Fax No.  908.713.2953

          with copies to:     King & Spalding
                              1185 Avenue of the Americas
                              New York, NY  10036
                              Attn:  Lawrence A. Larose, Esq.
                              Fax No.  212.536.2222

          If to Agent:        FOOTHILL CAPITAL CORPORATION
                              One Boston Place, Suite 1800
                              Boston, Massachusetts  02108
                              Attn:  Ron Cote
                              Fax No.  617.722.9493

                                      -70-

<PAGE>

          with copies to:     Schulte Roth & Zabel LLP
                              919 Third Avenue
                              New York, New York  10022
                              Attn:  Frederic L. Ragucci, Esq.
                              Fax No.  212.593.5955

            Agent and Borrower may change the address at which they are to
receive notices hereunder, by notice in writing in the foregoing manner given to
the other party. All notices or demands sent in accordance with this SECTION 12,
other than notices by Agent in connection with enforcement rights against the
Collateral under the provisions of the Code, shall be deemed received on the
earlier of the date of actual receipt or 3 Business Days after the deposit
thereof in the mail. Borrower acknowledges and agrees that notices sent by the
Lender Group in connection with the exercise of enforcement rights against
Collateral under the provisions of the Code shall be deemed sent when deposited
in the mail or personally delivered, or, where permitted by law, transmitted by
telefacsimile or any other method set forth above.

13.        CHOICE OF LAW AND VENUE; JURY TRIAL WAIVER.

            (a) THE VALIDITY OF THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS
(UNLESS EXPRESSLY PROVIDED TO THE CONTRARY IN ANOTHER LOAN DOCUMENT IN RESPECT
OF SUCH OTHER LOAN DOCUMENT), THE CONSTRUCTION, INTERPRETATION, AND ENFORCEMENT
HEREOF AND THEREOF, AND THE RIGHTS OF THE PARTIES HERETO AND THERETO WITH
RESPECT TO ALL MATTERS ARISING HEREUNDER OR THEREUNDER OR RELATED HERETO OR
THERETO SHALL BE DETERMINED UNDER, GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK.

            (b) THE PARTIES HERETO AGREE THAT ALL ACTIONS OR PROCEEDINGS ARISING
IN CONNECTION WITH THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS SHALL BE TRIED
AND LITIGATED ONLY IN THE STATE AND FEDERAL COURTS LOCATED IN THE COUNTY OF NEW
YORK, STATE OF NEW YORK, PROVIDED, HOWEVER, THAT ANY SUIT SEEKING ENFORCEMENT
AGAINST ANY COLLATERAL OR OTHER PROPERTY MAY BE BROUGHT, AT AGENT'S OPTION, IN
THE COURTS OF ANY JURISDICTION WHERE AGENT ELECTS TO BRING SUCH ACTION OR WHERE
SUCH COLLATERAL OR OTHER PROPERTY MAY BE FOUND. BORROWER AND THE LENDER GROUP
WAIVE, TO THE EXTENT PERMITTED UNDER APPLICABLE LAW, ANY RIGHT EACH MAY HAVE TO
ASSERT THE DOCTRINE OF FORUM NON CONVENIENS OR TO OBJECT TO VENUE TO THE EXTENT
ANY PROCEEDING IS BROUGHT IN ACCORDANCE WITH THIS SECTION 13(B).

            (c) BORROWER AND THE LENDER GROUP HEREBY WAIVE THEIR RESPECTIVE
RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT
OF ANY OF THE LOAN DOCUMENTS OR ANY OF THE TRANSACTIONS CONTEMPLATED THEREIN,
INCLUDING CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS, AND ALL OTHER
COMMON LAW OR STATUTORY CLAIMS. BORROWER AND THE LENDER GROUP REPRESENT THAT
EACH HAS REVIEWED THIS WAIVER AND EACH KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY
TRIAL RIGHTS FOLLOWING CONSULTATION WITH LEGAL COUNSEL. IN THE EVENT OF
LITIGATION, A COPY OF THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A
TRIAL BY THE COURT.

                                      -71-

<PAGE>

            14. ASSIGNMENTS AND PARTICIPATIONS; SUCCESSORS.

                14.1 ASSIGNMENTS AND PARTICIPATIONS.

            (a) Any Lender may, with the written consent of Agent (provided that
no written consent of Agent shall be required in connection with any assignment
and delegation by a Lender to an Eligible Transferee), assign and delegate to
one or more assignees (each an "Assignee") all, or any ratable part of all, of
the Obligations, the Commitments and the other rights and obligations of such
Lender hereunder and under the other Loan Documents, in a minimum amount of
$5,000,000 (such minimum amount not to apply to an Eligible Affiliate
Transferee); PROVIDED, HOWEVER, that Borrower and Agent may continue to deal
solely and directly with such Lender in connection with the interest so assigned
to an Assignee until (i) written notice of such assignment, together with
payment instructions, addresses, and related information with respect to the
Assignee, have been given to Borrower and Agent by such Lender and the Assignee,
(ii) except in the case of an assignment to an Eligible Affiliate Transferee,
such Lender and its Assignee have delivered to Borrower and Agent an Assignment
and Acceptance in form and substance satisfactory to Agent, and (iii) except in
the case of an assignment to an Eligible Affiliate Transferee, the assignor
Lender or Assignee has paid to Agent for Agent's separate account a processing
fee in the amount of $5,000. Anything contained herein to the contrary
notwithstanding, the consent of Agent shall not be required (and payment of any
fees shall not be required) if such assignment is in connection with any merger,
consolidation, sale, transfer, or other disposition of all or any substantial
portion of the business or loan portfolio of such Lender.

            (b) From and after the date that Agent notifies the assignor Lender
(with a copy to Borrower) that it has received an executed Assignment and
Acceptance and payment of the above-referenced processing fee (in each case to
the extent required under subsection (a) above), (i) the Assignee thereunder
shall be a party hereto and, to the extent that rights and obligations hereunder
have been assigned to it pursuant to such Assignment and Acceptance, shall have
the rights and obligations of a Lender under the Loan Documents, and (ii) the
assignor Lender shall, to the extent that rights and obligations hereunder and
under the other Loan Documents have been assigned by it pursuant to such
Assignment and Acceptance, relinquish its rights (except with respect to SECTION
11.3 hereof) and be released from its obligations under this Agreement (and in
the case of an Assignment and Acceptance covering all or the remaining portion
of an assigning Lender's rights and obligations under this Agreement and the
other Loan Documents, such Lender shall cease to be a party hereto and thereto),
and such assignment shall affect a novation between Borrower and the Assignee.

            (c) By executing and delivering an Assignment and Acceptance, the
assigning Lender thereunder and the Assignee thereunder confirm to and agree
with each other and the other parties hereto as follows: (1) other than as
provided in such Assignment and Acceptance, such assigning Lender makes no
representation or warranty and assumes no responsibility with respect to any
statements, warranties or representations made in or in connection with this

                                      -72-

<PAGE>

Agreement or the execution, legality, validity, enforceability, genuineness,
sufficiency or value of this Agreement or any other Transaction Document
furnished pursuant hereto, (2) such assigning Lender makes no representation or
warranty and assumes no responsibility with respect to the financial condition
of Borrower or the performance or observance by Borrower of any of its
obligations under this Agreement or any other Transaction Document furnished
pursuant hereto, (3) such Assignee confirms that it has received a copy of this
Agreement, together with such other documents and information as it has deemed
appropriate to make its own credit analysis and decision to enter into such
Assignment and Acceptance, (4) such Assignee will, independently and without
reliance upon Agent, such assigning Lender or any other Lender, and based on
such documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not taking action under
this Agreement, (5) such Assignee appoints and authorizes Agent to take such
actions and to exercise such powers under this Agreement as are delegated to
Agent, by the terms hereof, together with such powers as are reasonably
incidental thereto, and (6) such Assignee agrees that it will perform all of the
obligations which by the terms of this Agreement are required to be performed by
it as a Lender.

            (d) Immediately upon each Assignee's making its processing fee
payment under the Assignment and Acceptance and receipt and acknowledgment by
Agent of such fully executed Assignment and Acceptance (in each case to the
extent required under subsection (a) above), this Agreement shall be deemed to
be amended to the extent, but only to the extent, necessary to reflect the
addition of the Assignee and the resulting adjustment of the Commitments arising
therefrom. The Commitment allocated to each Assignee shall reduce such
Commitments of the assigning Lender PRO TANTO.

            (e) Any Lender may at any time, with the written consent of Agent,
sell to one or more commercial banks, financial institutions, or other Persons
not Affiliates of such Lender (a "Participant") participating interests in its
Obligations, the Commitment, and the other rights and interests of that Lender
(the "Originating Lender") hereunder and under the other Loan Documents
(provided that no written consent of Agent shall be required in connection with
any sale of any such participating interests by a Lender to an Eligible
Transferee); PROVIDED, HOWEVER, that (i) the Originating Lender shall remain a
"Lender" for all purposes of this Agreement and the other Loan Documents and the
Participant receiving the participating interest in the Obligations, the
Commitments, and the other rights and interests of the Originating Lender
hereunder shall not constitute a "Lender" hereunder or under the other Loan
Documents and the Originating Lender's obligations under this Agreement shall
remain unchanged, (ii) the Originating Lender shall remain solely responsible
for the performance of such obligations, (iii) Borrower, Agent, and the Lenders
shall continue to deal solely and directly with the Originating Lender in
connection with the Originating Lender's rights and obligations under this
Agreement and the other Loan Documents, (iv) no Lender shall transfer or grant
any participating interest under which the Participant has the right to approve
any amendment to, or any consent or waiver with respect to, this Agreement or
any other Loan Document, except to the extent such amendment to, or consent or
waiver with respect to this Agreement or of any other Loan Document would (A)
extend the final maturity date of the Obligations hereunder in which such
Participant is participating, (B) reduce the interest rate applicable to the
Obligations hereunder in which such Participant is participating, (C) release

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all or a material portion of the Collateral or guaranties (except to the extent
expressly provided herein or in any of the Loan Documents) supporting the
Obligations hereunder in which such Participant is participating, (D) postpone
the payment of, or reduce the amount of, the interest or fees payable to such
Participant through such Lender, or (E) change the amount or due dates of
scheduled principal repayments or prepayments or premiums, and (v) all amounts
payable by Borrower hereunder shall be determined as if such Lender had not sold
such participation, except that, if amounts outstanding under this Agreement are
due and unpaid, or shall have been declared or shall have become due and payable
upon the occurrence of an Event of Default, each Participant shall be deemed to
have the right of set-off in respect of its participating interest in amounts
owing under this Agreement to the same extent as if the amount of its
participating interest were owing directly to it as a Lender under this
Agreement. The rights of any Participant only shall be derivative through the
Originating Lender with whom such Participant participates and no Participant
shall have any rights under this Agreement or the other Loan Documents or any
direct rights as to the other Lenders, Agent, Borrower, the Collections, the
Collateral, or otherwise in respect of the Obligations. No Participant shall
have the right to participate directly in the making of decisions by the Lenders
among themselves. The provisions of this SECTION 14.1(E) are solely for the
benefit of the Lender Group, and Borrower shall not have any rights as a third
party beneficiary of such provisions.

            (f) In connection with any such assignment or participation or
proposed assignment or participation, a Lender may disclose all documents and
information which it now or hereafter may have relating to Borrower or
Borrower's business.

            (g) Any other provision in this Agreement notwithstanding, any
Lender may at any time create a security interest in, or pledge, all or any
portion of its rights under and interest in this Agreement in favor of any
Federal Reserve Bank in accordance with Regulation A of the Federal Reserve Bank
or U.S. Treasury Regulation 31 CFR ss.203.14, and such Federal Reserve Bank may
enforce such pledge or security interest in any manner permitted under
applicable law.

            (h) Borrower shall maintain at its address set forth in SECTION 12 a
copy of each Assignment and Acceptance delivered to it and a register for the
recordation of the names and addresses of Lenders, and the Commitment of, and
certain of the Obligations owing to, each Lender pursuant to the terms hereof
from time to time (the "REGISTER"), PROVIDED that, in the case of an assignment
or delegation to an Eligible Affiliate Transferee, such Eligible Affiliate
Transferee shall maintain a comparable Register on behalf of Borrower. The
entries in the Register shall be conclusive, and Borrower, Agent and Lenders may
treat each Person whose name is recorded in the Register pursuant to the terms
hereof as a Lender hereunder for all purposes of this Agreement, notwithstanding
notice to the contrary. Any Obligation (and the registered note, if any,
evidencing the same) may be assigned or delegated in whole or in part only by
registration of such assignment on the Register (and each registered note shall
expressly so provide). In the event that any Lender sells participations in any
Obligations, such Lender shall maintain a register on which it enters the name
of all participants in such Obligations held by it (the "PARTICIPANT REGISTER").
Any Obligation (and the registered note, if any, evidencing the same) may be
participated in whole or in part only by registration of such participation on
the Participant Register (and each registered note shall expressly so provide).

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            14.2 SUCCESSORS. This Agreement shall bind and inure to the benefit
of the respective successors and assigns of each of the parties; PROVIDED,
HOWEVER, that Borrower may not assign this Agreement or any rights or duties
hereunder without the Lenders' prior written consent and any prohibited
assignment shall be absolutely void AB INITIO. No consent to assignment by the
Lenders shall release Borrower from its Obligations. A Lender may assign this
Agreement and the other Loan Documents and its rights and duties hereunder and
thereunder pursuant to SECTION 14.1 hereof and, except as expressly required
pursuant to SECTION 14.1 hereof, no consent or approval by Borrower is required
in connection with any such assignment.

            15. AMENDMENTS; WAIVERS.

            15.1 AMENDMENTS AND WAIVERS. No amendment or waiver of any provision
of this Agreement or any other Loan Document, and no consent with respect to any
departure by Borrower therefrom, shall be effective unless the same shall be in
writing and signed by the Required Lenders (or by Agent at the written request
of the Required Lenders) and Borrower and then any such waiver or consent shall
be effective only in the specific instance and for the specific purpose for
which given; PROVIDED, HOWEVER, that no such waiver, amendment, or consent
shall, unless in writing and signed by all of the Lenders affected thereby and
Borrower, do any of the following:

            (a) increase or extend any Commitment of any Lender,

            (b) postpone or delay any date fixed by this Agreement or any other
Loan Document for any payment of principal, interest, fees, or other amounts due
hereunder or under any other Loan Document,

            (c) reduce the principal of, or the rate of interest on, any loan or
other extension of credit hereunder, or reduce any fees or other amounts payable
hereunder or under any other Loan Document,

            (d) change the percentage of the Commitments that is required to
take any action hereunder,

            (e) amend this Section or any provision of the Agreement providing
for consent or other action by all Lenders,

            (f) release Collateral other than as permitted by SECTION 16.12,

            (g) change the definition of "Required Lenders",

            (h) contractually subordinate any of the Agent's Liens,

            (i) release Borrower from any obligation for the payment of money,
or

            (j) change the definition of Borrowing Base (or the defined terms
used therein) or the definitions of Subject Accounts, Eligible Subject Accounts,
Purchased Accounts, Eligible Accounts, Maximum Revolver Amount, or change
SECTION 2.1(B), or

                                      -75-

<PAGE>

            (k) amend or waive any of the provisions of Section 6.14, 7.11, 7.13
or 8.16;

and, PROVIDED FURTHER, HOWEVER, that no amendment, waiver or consent shall,
unless in writing and signed by Agent or Swing Lender, as applicable, affect the
rights or duties of Agent or Swing Lender, as applicable, under this Agreement
or any other Loan Document. The foregoing notwithstanding, any amendment,
modification, waiver, consent, termination, or release of, or with respect to,
any provision of this Agreement or any other Loan Document that relates only to
the relationship of the Lender Group among themselves, and that does not affect
the rights or obligations of Borrower, shall not require consent by or the
agreement of Borrower.

            Notwithstanding anything to the contrary contained in this SECTION
15.1, any amendment, modification, supplement or waiver of the Specified
Provisions required by SECTION 7.20(B)(IV) shall be effective when signed by
Agent and Borrower.

            15.2 REPLACEMENT OF HOLDOUT LENDER.

            (a) If any action to be taken by the Lender Group or Agent hereunder
requires the unanimous consent, authorization, or agreement of all Lenders, and
a Lender ("Holdout Lender") fails to give its consent, authorization, or
agreement, then Agent, upon at least 5 Business Days prior irrevocable notice to
the Holdout Lender, may permanently replace the Holdout Lender with one or more
substitute Lenders (each, a "Replacement Lender"), and the Holdout Lender shall
have no right to refuse to be replaced hereunder. Such notice to replace the
Holdout Lender shall specify an effective date for such replacement, which date
shall not be later than 15 Business Days after the date such notice is given.

            (b) Prior to the effective date of such replacement, the Holdout
Lender and each Replacement Lender shall execute and deliver an Assignment and
Acceptance Agreement, subject only to the Holdout Lender being repaid its share
of the outstanding Obligations without any premium or penalty of any kind
whatsoever. If the Holdout Lender shall refuse or fail to execute and deliver
any such Assignment and Acceptance Agreement prior to the effective date of such
replacement, the Holdout Lender shall be deemed to have executed and delivered
such Assignment and Acceptance Agreement. The replacement of any Holdout Lender
shall be made in accordance with the terms of Section 14.1. Until such time as
the Replacement Lenders shall have acquired all of the Obligations, the
Commitments, and the other rights and obligations of the Holdout Lender
hereunder and under the other Loan Documents, the Holdout Lender shall remain
obligated to make the Holdout Lender's Pro Rata Share of Advances.

            15.3 NO WAIVERS; CUMULATIVE REMEDIES. No failure by Agent or any
Lender to exercise any right, remedy, or option under this Agreement or any
other Loan Document, or delay by Agent or any Lender in exercising the same,
will operate as a waiver thereof. No waiver by Agent or any Lender will be
effective unless it is in writing, and then only to the extent specifically
stated. No waiver by Agent or any Lender on any occasion shall affect or
diminish Agent's and each Lender's rights thereafter to require strict
performance by Borrower of any provision of this Agreement. Agent's and each
Lender's rights under this Agreement and the other Loan Documents will be
cumulative and not exclusive of any other right or remedy the Agent or any
Lender may have.

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<PAGE>

16.        AGENT; THE LENDER GROUP.

            16.1 APPOINTMENT AND AUTHORIZATION OF AGENT. Each Lender hereby
designates and appoints Foothill as its representative under this Agreement and
the other Transaction Documents and each Lender hereby irrevocably authorizes
Agent to take such action on its behalf under the provisions of this Agreement
and each other Transaction Document and to exercise such powers and perform such
duties as are expressly delegated to Agent by the terms of this Agreement or any
other Transaction Document, together with such powers as are reasonably
incidental thereto. Agent agrees to act as such on the express conditions
contained in this SECTION 16. The provisions of this Section 16 are solely for
the benefit of Agent, and the Lenders, and Borrower shall have no rights as a
third party beneficiary of any of the provisions contained herein. Any provision
to the contrary contained elsewhere in this Agreement or in any other
Transaction Document notwithstanding, Agent shall not have any duties or
responsibilities, except those expressly set forth herein, nor shall Agent have
or be deemed to have any fiduciary relationship with any Lender, and no implied
covenants, functions, responsibilities, duties, obligations or liabilities shall
be read into this Agreement or any other Transaction Document or otherwise exist
against Agent; it being expressly understood and agreed that the use of the word
"Agent" is for convenience only, that Foothill is merely the representative of
the Lenders, and only has the contractual duties set forth herein. Except as
expressly otherwise provided in this Agreement, Agent shall have and may use its
sole discretion with respect to exercising or refraining from exercising any
discretionary rights or taking or refraining from taking any actions that Agent
expressly is entitled to take or assert under or pursuant to this Agreement and
the other Transaction Documents. Without limiting the generality of the
foregoing, or of any other provision of the Transaction Documents that provides
rights or powers to Agent, Lenders agree that Agent shall have the right to
exercise the following powers as long as this Agreement remains in effect: (a)
maintain, in accordance with its customary business practices, ledgers and
records reflecting the status of the Obligations, the Collateral, the
Collections, and related matters, (b) execute or file any and all financing or
similar statements or notices, amendments, renewals, supplements, documents,
instruments, proofs of claim, notices and other written agreements with respect
to the Transaction Documents, (c) make Advances, for itself or on behalf of
Lenders as provided in the Loan Documents, (d) exclusively receive, apply, and
distribute the Collections as provided in the Loan Documents, (e) open and
maintain such bank accounts and cash management arrangements as Agent deems
necessary and appropriate in accordance with the Loan Documents for the
foregoing purposes with respect to the Collateral and the Collections, (f)
perform, exercise, and enforce any and all other rights and remedies of the
Lender Group with respect to Borrower, the Obligations, the Collateral, the
Collections, or otherwise related to any of same as provided in the Loan
Documents, and (g) incur and pay such Lender Group Expenses as Agent may deem
necessary or appropriate for the performance and fulfillment of its functions
and powers pursuant to the Loan Documents.

            16.2 DELEGATION OF DUTIES. Agent may execute any of its duties under
this Agreement or any other Transaction Document by or through agents, employees
or attorneys-in-fact and shall be entitled to advice of counsel concerning all
matters pertaining to such duties. Agent shall not be responsible for the
negligence or misconduct of any agent or attorney-in-fact that it selects as
long as such selection was made without gross negligence or willful misconduct.

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<PAGE>

            16.3 LIABILITY OF AGENT. None of the Agent-Related Persons shall (i)
be liable for any action taken or omitted to be taken by any of them under or in
connection with this Agreement or any other Transaction Document or the
transactions contemplated hereby (except for its own gross negligence or willful
misconduct), or (ii) be responsible in any manner to any of the Lenders for any
recital, statement, representation or warranty made by any Company, or any
officer or director thereof, contained in this Agreement or in any other
Transaction Document, or in any certificate, report, statement or other document
referred to or provided for in, or received by Agent under or in connection
with, this Agreement or any other Transaction Document, or the validity,
effectiveness, genuineness, enforceability or sufficiency of this Agreement or
any other Transaction Document, or for any failure of Borrower, Servicer, any
Originator or any other party to any Transaction Document to perform its
obligations hereunder or thereunder. No Agent-Related Person shall be under any
obligation to any Lender to ascertain or to inquire as to the observance or
performance of any of the agreements contained in, or conditions of, this
Agreement or any other Transaction Document, or to inspect the Books or
properties of Borrower or the books or records or properties of any of
Borrower's Affiliates.

            16.4 RELIANCE BY AGENT. Agent shall be entitled to rely, and shall
be fully protected in relying, upon any writing, resolution, notice, consent,
certificate, affidavit, letter, telegram, facsimile, telex or telephone message,
statement or other document or conversation believed by it to be genuine and
correct and to have been signed, sent, or made by the proper Person or Persons,
and upon advice and statements of legal counsel (including counsel to Borrower
or counsel to any Lender), independent accountants and other experts selected by
Agent. Agent shall be fully justified in failing or refusing to take any action
under this Agreement or any other Transaction Document unless Agent shall first
receive such advice or concurrence of the Lenders as it deems appropriate and
until such instructions are received, Agent shall act, or refrain from acting,
as it deems advisable. If Agent so requests, it shall first be indemnified to
its reasonable satisfaction by Lenders against any and all liability and expense
that may be incurred by it by reason of taking or continuing to take any such
action. Agent shall in all cases be fully protected in acting, or in refraining
from acting, under this Agreement or any other Transaction Document in
accordance with a request or consent of the Lenders and such request and any
action taken or failure to act pursuant thereto shall be binding upon all of the
Lenders.

            16.5 NOTICE OF DEFAULT OR EVENT OF DEFAULT. Agent shall not be
deemed to have knowledge or notice of the occurrence of any Default or Event of
Default, except with respect to defaults in the payment of principal, interest,
fees, and expenses required to be paid to Agent for the account of the Lenders,
except with respect to Events of Default of which Agent has actual knowledge,
unless Agent shall have received written notice from a Lender or Borrower
referring to this Agreement, describing such Default or Event of Default, and
stating that such notice is a "notice of default." Agent promptly will notify
the Lenders of its receipt of any such notice or of any Event of Default of
which Agent has actual knowledge. If any Lender obtains actual knowledge of any
Event of Default, such Lender promptly shall notify the other Lenders and Agent
of such Event of Default. Each Lender shall be solely responsible for giving any
notices to its Participants, if any. Subject to SECTION 16.4, Agent shall take

                                      -78-

<PAGE>

such action with respect to such Default or Event of Default as may be requested
by the Required Lenders in accordance with SECTION 9; PROVIDED, HOWEVER, that
unless and until Agent has received any such request, Agent may (but shall not
be obligated to) take such action, or refrain from taking such action, with
respect to such Default or Event of Default as it shall deem advisable.

            16.6 CREDIT DECISION. Each Lender acknowledges that none of the
Agent-Related Persons has made any representation or warranty to it, and that no
act by Agent hereinafter taken, including any review of the affairs of Borrower
or Affiliates, shall be deemed to constitute any representation or warranty by
any Agent-Related Person to any Lender. Each Lender represents to Agent that it
has, independently and without reliance upon any Agent-Related Person and based
on such documents and information as it has deemed appropriate, made its own
appraisal of and investigation into the business, prospects, operations,
property, financial and other condition and creditworthiness of Borrower and any
other Person (other than the Lender Group) party to a Transaction Document, and
all applicable bank regulatory laws relating to the transactions contemplated
hereby, and made its own decision to enter into this Agreement and to extend
credit to Borrower. Each Lender also represents that it will, independently and
without reliance upon any Agent-Related Person and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit analysis, appraisals and decisions in taking or not taking action under
this Agreement and the other Transaction Documents, and to make such
investigations as it deems necessary to inform itself as to the business,
prospects, operations, property, financial and other condition and
creditworthiness of Borrower and any other Person (other than the Lender Group)
party to a Transaction Document. Except for notices, reports, and other
documents expressly herein required to be furnished to the Lenders by Agent,
Agent shall not have any duty or responsibility to provide any Lender with any
credit or other information concerning the business, prospects, operations,
property, financial and other condition or creditworthiness of Borrower and any
other Person party to a Transaction Document that may come into the possession
of any of the Agent-Related Persons.

            16.7 COSTS AND EXPENSES; INDEMNIFICATION. Agent may incur and pay
Lender Group Expenses to the extent Agent reasonably deems necessary or
appropriate for the performance and fulfillment of its functions, powers, and
obligations pursuant to the Transaction Documents, including court costs,
reasonable attorneys fees and expenses, costs of collection by outside
collection agencies and auctioneer fees and costs of security guards or
insurance premiums paid to maintain the Collateral, whether or not Borrower is
obligated to reimburse Agent or Lenders for such expenses pursuant to the Loan
Agreement or otherwise. Agent is authorized and directed to deduct and retain
sufficient amounts from Collections received by Agent to reimburse Agent for
such out-of-pocket costs and expenses prior to the distribution of any amounts
to Lenders. In the event Agent is not reimbursed for such costs and expenses
from Collections received by Agent, each Lender hereby agrees that it is and
shall be obligated to pay to or reimburse Agent for the amount of such Lender's
Pro Rata Share thereof. Whether or not the transactions contemplated hereby are
consummated, the Lenders shall indemnify upon demand the Agent-Related Persons
(to the extent not reimbursed by or on behalf of Borrower and without limiting
the obligation of Borrower to do so), according to their Pro Rata Shares, from
and against any and all Indemnified Liabilities; PROVIDED, HOWEVER, that no

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Lender shall be liable for the payment to any Agent-Related Person of any
portion of such Indemnified Liabilities resulting solely from such Person's
gross negligence or willful misconduct nor shall any Lender be liable for the
obligations of any Defaulting Lender in failing to make an Advance or other
extension of credit hereunder. Without limitation of the foregoing, each Lender
shall reimburse Agent upon demand for such Lender's ratable share of any costs
or out-of-pocket expenses (including attorneys fees and expenses) incurred by
Agent in connection with the preparation, execution, delivery, administration,
modification, amendment, or enforcement (whether through negotiations, legal
proceedings or otherwise) of, or legal advice in respect of rights or
responsibilities under, this Agreement, any other Transaction Document, or any
document contemplated by or referred to herein, to the extent that Agent is not
reimbursed for such expenses by or on behalf of Borrower. The undertaking in
this Section shall survive the payment of all Obligations hereunder and the
resignation or replacement of Agent.

            16.8 AGENT IN INDIVIDUAL CAPACITY. Foothill and its Affiliates may
make loans to, issue letters of credit for the account of, accept deposits from,
acquire equity interests in, and generally engage in any kind of banking, trust,
financial advisory, underwriting, or other business with Borrower and its
Affiliates and any other Person (other than the Lender Group) party to any
Transaction Documents as though Foothill were not Agent hereunder, and, in each
case, without notice to or consent of the other members of the Lender Group. The
other members of the Lender Group acknowledge that, pursuant to such activities,
Foothill or its Affiliates may receive information regarding Borrower or its
Affiliates and any other Person (other than the Lender Group) party to any
Transaction Documents that is subject to confidentiality obligations in favor of
Borrower or such other Person and that prohibit the disclosure of such
information to the Lenders, and the Lenders acknowledge that, in such
circumstances (and in the absence of a waiver of such confidentiality
obligations, which waiver Agent will use its reasonable best efforts to obtain),
Agent shall not be under any obligation to provide such information to them. The
terms "Lender" and "Lenders" include Foothill in its individual capacity.

            16.9 SUCCESSOR AGENT. Agent may resign as Agent upon 45 days notice
to the Lenders. If Agent resigns under this Agreement, the Required Lenders
shall appoint a successor Agent for the Lenders. If no successor Agent is
appointed prior to the effective date of the resignation of Agent, Agent may
appoint, after consulting with the Lenders, a successor Agent. If Agent has
materially breached or failed to perform any material provision of this
Agreement or of applicable law, the Required Lenders may agree in writing to
remove and replace Agent with a successor Agent from among the Lenders. In any
such event, upon the acceptance of its appointment as successor Agent hereunder,
such successor Agent shall succeed to all the rights, powers, and duties of the
retiring Agent and the term "Agent" shall mean such successor Agent and the
retiring Agent's appointment, powers, and duties as Agent shall be terminated.
After any retiring Agent's resignation hereunder as Agent, the provisions of
this Section 16 shall inure to its benefit as to any actions taken or omitted to
be taken by it while it was Agent under this Agreement. If no successor Agent
has accepted appointment as Agent by the date which is 45 days following a
retiring Agent's notice of resignation, the retiring Agent's resignation shall
nevertheless thereupon become effective and the Lenders shall perform all of the
duties of Agent hereunder until such time, if any, as the Lenders appoint a
successor Agent as provided for above.

            16.10 LENDER IN INDIVIDUAL CAPACITY. Any Lender and its respective
Affiliates may make loans to, issue letters of credit for the account of, accept
deposits from, acquire equity interests in and generally engage in any kind of
banking, trust, financial advisory, underwriting or other business with Borrower
and its Affiliates and any other Person (other than the Lender Group) party to
any Transaction Documents as though such Lender were not a Lender hereunder

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<PAGE>

without notice to or consent of the other members of the Lender Group. The other
members of the Lender Group acknowledge that, pursuant to such activities, such
Lender and its respective Affiliates may receive information regarding Borrower
or its Affiliates and any other Person (other than the Lender Group) party to
any Transaction Documents that is subject to confidentiality obligations in
favor of Borrower or such other Person and that prohibit the disclosure of such
information to the Lenders, and the Lenders acknowledge that, in such
circumstances (and in the absence of a waiver of such confidentiality
obligations, which waiver such Lender will use its reasonable best efforts to
obtain), such Lender not shall be under any obligation to provide such
information to them. With respect to the Swing Loans and Agent Advances, Swing
Lender shall have the same rights and powers under this Agreement as any other
Lender and may exercise the same as though it were not the sub-agent of Agent.

            16.11 WITHHOLDING TAXES.

            (a) If any Lender is a "foreign corporation, partnership or trust"
within the meaning of the IRC and such Lender claims exemption from, or a
reduction of, U.S. withholding tax under Sections 1441 or 1442 of the IRC, such
Lender agrees with and in favor of Agent and Borrower, to deliver to Agent and
Borrower:

            (i) if such Lender claims an exemption from withholding tax pursuant
to its portfolio interest exception, (A) a statement of the Lender, signed under
penalty of perjury, that it is not a (I) a "bank" as described in Section
881(c)(3)(A) of the IRC, (II) a 10% shareholder (within the meaning of Section
881(c)(3)(B) of the IRC), or (III) a controlled foreign corporation described in
Section 881(c)(3)(C) of the IRC, and (B) a properly completed IRS Form W-8BEN,
before the first payment of any interest under this Agreement and at any other
time reasonably requested by Agent or Borrower;

            (ii) if such Lender claims an exemption from, or a reduction of,
withholding tax under a United States tax treaty, properly completed IRS Form
W-8BEN before the first payment of any interest under this Agreement and at any
other time reasonably requested by Agent or Borrower;

            (iii) if such Lender claims that interest paid under this Agreement
is exempt from United States withholding tax because it is effectively connected
with a United States trade or business of such Lender, two properly completed
and executed copies of IRS Form W-8ECI before the first payment of any interest
is due under this Agreement and at any other time reasonably requested by Agent
or Borrower;

            (iv) such other form or forms as may be required under the IRC or
other laws of the United States as a condition to exemption from, or reduction
of, United States withholding tax.

Such Lender agrees promptly to notify Agent and Borrower of any change in
circumstances which would modify or render invalid any claimed exemption or
reduction.

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<PAGE>

            (b) If any Lender claims exemption from, or reduction of,
withholding tax under a United States tax treaty by providing IRS Form W-8BEN
and such Lender sells, assigns, grants a participation in, or otherwise
transfers all or part of the Obligations of Borrower to such Lender, such Lender
agrees to notify Agent of the percentage amount in which it is no longer the
beneficial owner of Obligations of Borrower to such Lender. To the extent of
such percentage amount, Agent will treat such Lender's IRS Form W-8BEN as no
longer valid.

            (c) If any Lender is entitled to a reduction in the applicable
withholding tax, Agent may withhold from any interest payment to such Lender an
amount equivalent to the applicable withholding tax after taking into account
such reduction. If the forms or other documentation required by subsection (a)
of this Section are not delivered to Agent, then Agent may withhold from any
interest payment to such Lender not providing such forms or other documentation
an amount equivalent to the applicable withholding tax.

            (d) If the IRS or any other Governmental Authority of the United
States or other jurisdiction asserts a claim that Agent did not properly
withhold tax from amounts paid to or for the account of any Lender (because the
appropriate form was not delivered, was not properly executed, or because such
Lender failed to notify Agent of a change in circumstances which rendered the
exemption from, or reduction of, withholding tax ineffective, or for any other
reason) such Lender shall indemnify and hold Agent harmless for all amounts
paid, directly or indirectly, by Agent as tax or otherwise, including penalties
and interest, and including any taxes imposed by any jurisdiction on the amounts
payable to Agent under this Section, together with all costs and expenses
(including attorneys fees and expenses). The obligation of the Lenders under
this subsection shall survive the payment of all Obligations and the resignation
or replacement of Agent.

            (e) All payments made by Borrower hereunder or under any note will
be made without setoff, counterclaim, or other defense, except as required by
applicable law other than for Taxes (as defined below). All such payments will
be made free and clear of, and without deduction or withholding for, any present
or future taxes, levies, imposts, duties, fees, assessments or other charges of
whatever nature now or hereafter imposed by any jurisdiction (other than the
United States) or by any political subdivision or taxing authority thereof or
therein (other than of the United States) with respect to such payments (but
excluding, any tax imposed by any jurisdiction or by any political subdivision
or taxing authority thereof or therein (i) measured by or based on the net
income or net profits of a Lender, or (ii) to the extent that such tax results
from a change in the circumstances of the Lender, including a change in the
residence, place of organization, or principal place of business of the Lender,
or a change in the branch or lending office of the Lender participating in the
transactions set forth herein) and all interest, penalties or similar
liabilities with respect thereto (all such non-excluded taxes, levies, imposts,
duties, fees, assessments or other charges being referred to collectively as
"Taxes"). If any Taxes are so levied or imposed, Borrower agrees to pay the full
amount of such Taxes, and such additional amounts as may be necessary so that
every payment of all amounts due under this Agreement or under any note,
including any amount paid pursuant to this Section 16.11(e) after withholding or
deduction for or on account of any Taxes, will not be less than the amount
provided for herein; PROVIDED, HOWEVER, that Borrower shall not be required to
increase any such amounts payable to Agent or any Lender (i) that is not

                                      -82-

<PAGE>

organized under the laws of the United States, if such Person fails to comply
with the other requirements of this Section 16.11, or (ii) if the increase in
such amount payable results from Agent's or such Lender's own willful misconduct
or gross negligence. Borrower will furnish to Agent as promptly as possible
after the date the payment of any Taxes is due pursuant to applicable law
certified copies of tax receipts evidencing such payment by Borrower.

            16.12 COLLATERAL MATTERS.

            (a) The Lenders hereby irrevocably authorize Agent, at its option
and in its sole discretion, to release any Lien on any Collateral (i) upon the
termination of the Commitments and payment and satisfaction in full by Borrower
of all Obligations, (ii) constituting property being sold or disposed of if a
release is required or desirable in connection therewith and if Borrower
certifies to Agent that the sale or disposition is permitted under SECTION 7.4
of this Agreement or the other Loan Documents (and Agent may rely conclusively
on any such certificate, without further inquiry), (iii) constituting property
in which Borrower owned no interest at the time the security interest was
granted or at any time thereafter, or (iv) constituting property leased to
Borrower under a lease that has expired or is terminated in a transaction
permitted under this Agreement. Except as provided above, Agent will not execute
and deliver a release of any Lien on any Collateral without the prior written
authorization of (y) if the release is of all or substantially all of the
Collateral, all of the Lenders, or (z) otherwise, the Required Lenders. Upon
request by Agent or Borrower at any time, the Lenders will confirm in writing
Agent's authority to release any such Liens on particular types or items of
Collateral pursuant to this SECTION 16.12; PROVIDED, HOWEVER, that (1) Agent
shall not be required to execute any document necessary to evidence such release
on terms that, in Agent's opinion, would expose Agent to liability or create any
obligation or entail any consequence other than the release of such Lien without
recourse, representation, or warranty, and (2) such release shall not in any
manner discharge, affect, or impair the Obligations or any Liens (other than
those expressly being released) upon (or obligations of Borrower in respect of)
all interests retained by Borrower, including, the proceeds of any sale, all of
which shall continue to constitute part of the Collateral.

            (b) Agent shall have no obligation whatsoever to any of the Lenders
to assure that the Collateral exists or is owned by Borrower or is cared for,
protected, or insured or has been encumbered, or that the Agent's Liens have
been properly or sufficiently or lawfully created, perfected, protected, or
enforced or are entitled to any particular priority, or to exercise at all or in
any particular manner or under any duty of care, disclosure or fidelity, or to
continue exercising, any of the rights, authorities and powers granted or
available to Agent pursuant to any of the Loan Documents, it being understood
and agreed that in respect of the Collateral, or any act, omission, or event
related thereto, subject to the terms and conditions contained herein, Agent may
act in any manner it may deem appropriate, in its sole discretion given Agent's
own interest in the Collateral in its capacity as one of the Lenders and that
Agent shall have no other duty or liability whatsoever to any Lender as to any
of the foregoing, except as otherwise provided herein.

            16.13 RESTRICTIONS ON ACTIONS BY LENDERS; SHARING OF PAYMENTS.

            (a) Each of the Lenders agrees that it shall not, without the
express consent of Agent, and that it shall, to the extent it is lawfully
entitled to do so, upon the request of Agent, set off against the Obligations,
any amounts owing by such Lender to Borrower or any deposit accounts of Borrower
now or hereafter maintained with such Lender. Each of the Lenders further agrees

                                      -83-

<PAGE>

that it shall not, unless specifically requested to do so by Agent, take or
cause to be taken any action, including, the commencement of any legal or
equitable proceedings, to foreclose any Lien on, or otherwise enforce any
security interest in, any of the Collateral the purpose of which is, or could
be, to give such Lender any preference or priority against the other Lenders
with respect to the Collateral.

            (b) If, at any time or times any Lender shall receive (i) by
payment, foreclosure, setoff, or otherwise, any proceeds of Collateral or any
payments with respect to the Obligations arising under, or relating to, this
Agreement or the other Loan Documents, except for any such proceeds or payments
received by such Lender from Agent pursuant to the terms of this Agreement, or
(ii) payments from Agent in excess of such Lender's ratable portion of all such
distributions by Agent, such Lender promptly shall (1) turn the same over to
Agent, in kind, and with such endorsements as may be required to negotiate the
same to Agent, or in immediately available funds, as applicable, for the account
of all of the Lenders and for application to the Obligations in accordance with
the applicable provisions of this Agreement, or (2) purchase, without recourse
or warranty, an undivided interest and participation in the Obligations owed to
the other Lenders so that such excess payment received shall be applied ratably
as among the Lenders in accordance with their Pro Rata Shares; PROVIDED,
HOWEVER, that if all or part of such excess payment received by the purchasing
party is thereafter recovered from it, those purchases of participations shall
be rescinded in whole or in part, as applicable, and the applicable portion of
the purchase price paid therefor shall be returned to such purchasing party, but
without interest except to the extent that such purchasing party is required to
pay interest in connection with the recovery of the excess payment.

            16.14 AGENCY FOR PERFECTION. Agent hereby appoints each other Lender
as its agent (and each Lender hereby accepts such appointment) for the purpose
of perfecting the Agent's Liens in assets which, in accordance with Article 9 of
the UCC can be perfected only by possession. Should any Lender obtain possession
of any such Collateral, such Lender shall notify Agent thereof, and, promptly
upon Agent's request therefor shall deliver such Collateral to Agent or in
accordance with Agent's instructions.

            16.15 PAYMENTS BY AGENT TO THE LENDERS. All payments to be made by
Agent to the Lenders shall be made by bank wire transfer or internal transfer of
immediately available funds pursuant to such wire transfer instructions as each
party may designate for itself by written notice to Agent. Concurrently with
each such payment, Agent shall identify whether such payment (or any portion
thereof) represents principal, premium, or interest of the Obligations.

            16.16 CONCERNING THE COLLATERAL AND RELATED LOAN DOCUMENTS. Each
member of the Lender Group authorizes and directs Agent to enter into this
Agreement and the other Loan Documents relating to the Collateral, for the
benefit of the Lender Group. Each member of the Lender Group agrees that any
action taken by Agent in accordance with the terms of this Agreement or the
other Loan Documents relating to the Collateral and the exercise by Agent of its
powers set forth therein or herein, together with such other powers that are
reasonably incidental thereto, shall be binding upon all of the Lenders.

                                      -84-

<PAGE>

            16.17 FIELD AUDITS AND EXAMINATION REPORTS; CONFIDENTIALITY;
DISCLAIMERS BY LENDERS; OTHER REPORTS AND INFORMATION. By becoming a party to
this Agreement, each Lender:

            (a) is deemed to have requested that Agent furnish such Lender,
promptly after it becomes available, a copy of each field audit or examination
report (each a "Report" and collectively, "Reports") prepared by Agent, and
Agent shall so furnish each Lender with such Reports,

            (b) expressly agrees and acknowledges that Agent does not (i) make
any representation or warranty as to the accuracy of any Report, and (ii) shall
not be liable for any information contained in any Report,

            (c) expressly agrees and acknowledges that the Reports are not
comprehensive audits or examinations, that Agent or other party performing any
audit or examination will inspect only specific information regarding Borrower
and will rely significantly upon the Books, as well as on representations of
Borrower's personnel,

            (d) agrees to keep all Reports and other material, non-public
information regarding Borrower and its operations, assets, and existing and
contemplated business plans in a confidential manner; it being understood and
agreed by Borrower that in any event such Lender may make disclosures (a) to
counsel for and other advisors, accountants, and auditors to such Lender, (b)
reasonably required by any bona fide potential or actual Assignee or Participant
in connection with any contemplated or actual assignment or transfer by such
Lender of an interest herein or any participation interest in such Lender's
rights hereunder, (c) of information that has become public by disclosures made
by Persons other than such Lender, its Affiliates, assignees, transferees, or
Participants, or (d) as required or requested by any court, governmental or
administrative agency, pursuant to any subpoena or other legal process, or by
any law, statute, regulation, or court order; provided, however, that, unless
prohibited by applicable law, statute, regulation, or court order, such Lender
shall notify Borrower of any request by any court, governmental or
administrative agency, or pursuant to any subpoena or other legal process for
disclosure of any such non-public material information concurrent with, or where
practicable, prior to the disclosure thereof, and

            (e) without limiting the generality of any other indemnification
provision contained in this Agreement, agrees: (i) to hold Agent and any other
Lender preparing a Report harmless from any action the indemnifying Lender may
take or conclusion the indemnifying Lender may reach or draw from any Report in
connection with any loans or other credit accommodations that the indemnifying
Lender has made or may make to Borrower, or the indemnifying Lender's
participation in, or the indemnifying Lender's purchase of, a loan or loans of
Borrower, and (ii) to pay and protect, and indemnify, defend and hold Agent, and
any such other Lender preparing a Report harmless from and against, the claims,
actions, proceedings, damages, costs, expenses, and other amounts (including,
attorneys fees and costs) incurred by Agent and any such other Lender preparing
a Report as the direct or indirect result of any third parties who might obtain
all or part of any Report through the indemnifying Lender.

                                      -85-

<PAGE>

            In addition to the foregoing: (x) any Lender may from time to time
request of Agent in writing that Agent provide to such Lender a copy of any
report or document provided by Borrower to Agent that has not been
contemporaneously provided by Borrower to such Lender, and, upon receipt of such
request, Agent promptly shall provide a copy of same to such Lender, (y) to the
extent that Agent is entitled, under any provision of the Loan Documents, to
request additional reports or information from Borrower, any Lender may, from
time to time, reasonably request Agent to exercise such right as specified in
such Lender's notice to Agent, whereupon Agent promptly shall request of
Borrower the additional reports or information reasonably specified by such
Lender, and, upon receipt thereof from Borrower, Agent promptly shall provide a
copy of same to such Lender, and (z) any time that Agent renders to Borrower a
statement regarding the Loan Account, Agent shall send a copy of such statement
to each Lender.

            16.18 SEVERAL OBLIGATIONS; NO LIABILITY. Notwithstanding that
certain of the Transaction Documents now or hereafter may have been or will be
executed only by or in favor of Agent in its capacity as such, and not by or in
favor of the Lenders, any and all obligations on the part of Agent (if any) to
make any credit available hereunder shall constitute the several (and not joint)
obligations of the respective Lenders on a ratable basis, according to their
respective Commitments, to make an amount of such credit not to exceed, in
principal amount, at any one time outstanding, the amount of their respective
Commitments. Nothing contained herein shall confer upon any Lender any interest
in, or subject any Lender to any liability for, or in respect of, the business,
assets, profits, losses, or liabilities of any other Lender. Each Lender shall
be solely responsible for notifying its Participants of any matters relating to
the Transaction Documents to the extent any such notice may be required, and no
Lender shall have any obligation, duty, or liability to any Participant of any
other Lender. Except as provided in SECTION 16.7, no member of the Lender Group
shall have any liability for the acts or any other member of the Lender Group.
No Lender shall be responsible to Borrower or any other Person for any failure
by any other Lender to fulfill its obligations to make credit available
hereunder, nor to advance for it or on its behalf in connection with its
Commitment, nor to take any other action on its behalf hereunder or in
connection with the financing contemplated herein.

            17. GENERAL PROVISIONS.

            17.1 EFFECTIVENESS. This Agreement shall be binding and deemed
effective when executed by Borrower, Agent, and each Lender whose signature is
provided for on the signature pages hereof.

            17.2 SECTION HEADINGS. Headings and numbers have been set forth
herein for convenience only. Unless the contrary is compelled by the context,
everything contained in each Section applies equally to this entire Agreement.

            17.3 INTERPRETATION. Neither this Agreement nor any uncertainty or
ambiguity herein shall be construed against the Lender Group or Borrower,
whether under any rule of construction or otherwise. On the contrary, this
Agreement has been reviewed by all parties and shall be construed and
interpreted according to the ordinary meaning of the words used so as to
accomplish fairly the purposes and intentions of all parties hereto.

                                      -86-

<PAGE>

            17.4 SEVERABILITY OF PROVISIONS. Each provision of this Agreement
shall be severable from every other provision of this Agreement for the purpose
of determining the legal enforceability of any specific provision.

            17.5 AMENDMENTS IN WRITING. This Agreement only can be amended by a
writing signed by Agent (on behalf of the requisite Lenders) and Borrower.

            17.6 COUNTERPARTS; TELEFACSIMILE EXECUTION. This Agreement may be
executed in any number of counterparts and by different parties on separate
counterparts, each of which, when executed and delivered, shall be deemed to be
an original, and all of which, when taken together, shall constitute but one and
the same Agreement. Delivery of an executed counterpart of this Agreement by
telefacsimile shall be equally as effective as delivery of an original executed
counterpart of this Agreement. Any party delivering an executed counterpart of
this Agreement by telefacsimile also shall deliver an original executed
counterpart of this Agreement but the failure to deliver an original executed
counterpart shall not affect the validity, enforceability, and binding effect of
this Agreement. The foregoing shall apply to each other Loan Document mutatis
mutandis.

            17.7 REVIVAL AND REINSTATEMENT OF OBLIGATIONS. If the incurrence or
payment of the Obligations by Borrower or the transfer to the Lender Group of
any property should for any reason subsequently be declared to be void or
voidable under any state or federal law relating to creditors' rights, including
provisions of the Bankruptcy Code relating to fraudulent conveyances,
preferences, or other voidable or recoverable payments of money or transfers of
property (collectively, a "Voidable Transfer"), and if the Lender Group is
required to repay or restore, in whole or in part, any such Voidable Transfer,
or elects to do so upon the reasonable advice of its counsel, then, as to any
such Voidable Transfer, or the amount thereof that the Lender Group is required
or elects to repay or restore, and as to all reasonable costs, expenses, and
attorneys fees of the Lender Group related thereto, the liability of Borrower
automatically shall be revived, reinstated, and restored and shall exist as
though such Voidable Transfer had never been made.

            17.8 INTEGRATION. This Agreement, together with the other
Transaction Documents, reflects the entire understanding of the parties with
respect to the transactions contemplated hereby and shall not be contradicted or
qualified by any other agreement, oral or written, before the date hereof.

                           [Signature page to follow.]

<PAGE>

            IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed and delivered as of the date first above written.

                            FOSTER WHEELER FUNDING LLC,
                            a Delaware limited liability company

                            By:
                                    ------------------------------------------
                                    Title:

                            FOOTHILL CAPITAL CORPORATION,
                            a California corporation, as Agent and as a Lender

                            By:
                                    ------------------------------------------
                                    Title:

                            ABLECO FINANCE LLC,
                            a Delaware limited liability company, as a Lender

                            By:
                                    -----------------------------------------
                                    Title:

                                      -88-

<PAGE>

<TABLE>
<CAPTION>
                                TABLE OF CONTENTS
                                                                               PAGE

<C>                                                                             <C>
1.    DEFINITIONS AND CONSTRUCTION...............................................1
      1.1          Definitions...................................................1
      1.2          Accounting Terms.............................................26
      1.3          Code.........................................................26
      1.4          Construction.................................................26
      1.5          Schedules and Exhibits.......................................26

2.    LOAN AND TERMS OF PAYMENT.................................................26
      2.1          Revolver Advances............................................26
      2.2          [Intentionally Omitted]......................................27
      2.3          Borrowing Procedures and Settlements.........................27
      2.4          Payments.....................................................34
      2.5          Overadvances.................................................36
      2.6          Interest Rates:  Rates, Payments, and Calculations...........36
      2.7          Cash Management..............................................37
      2.8          Crediting Payments...........................................38
      2.9          Designated Account...........................................39
      2.10         Maintenance of Loan Account; Statements of Obligations.......39
      2.11         Fees.........................................................39
      2.12         Capital Requirements.........................................40

3.    CONDITIONS; TERM OF AGREEMENT.............................................41
      3.1          Conditions Precedent to the Initial Extension of Credit......41
      3.2          Conditions Subsequent to the Initial Extension of Credit.....44
      3.3          Conditions Precedent to all Extensions of Credit.............44
      3.4          Term.........................................................45
      3.5          Effect of Termination........................................45
      3.6          Early Termination by Borrower................................45

4.    CREATION OF SECURITY INTEREST.............................................46
      4.1          Grant of Security Interest...................................46
      4.2          Negotiable Collateral........................................46
      4.3          Collection of Accounts, General Intangibles,
                         and Negotiable Collateral..............................46
      4.4          Delivery of Additional Documentation Required................46
      4.5          Power of Attorney............................................46
      4.6          Right to Inspect.............................................47
      4.7          Control Agreements...........................................47

5.    REPRESENTATIONS AND WARRANTIES............................................47
      5.1          No Encumbrances..............................................48
      5.2          Eligible Accounts............................................48
      5.3          Location of Chief Executive Office; FEIN.....................48
      5.4          Due Organization and Qualification; Subsidiaries.............48
      5.5          Due Authorization; No Conflict...............................48
      5.6          Litigation...................................................49

                                      -i-

<PAGE>

      5.7          No Material Adverse Change...................................49
      5.8          Fraudulent Transfer..........................................49
      5.9          Employee Benefits............................................50
      5.10         Brokerage Fees...............................................50
      5.11         Property.....................................................50
      5.12         Obligations..................................................50
      5.13         Business.....................................................50
      5.14         DDAs.........................................................50
      5.15         Credit and Collection Policies...............................50
      5.16         Complete Disclosure..........................................50

6.    AFFIRMATIVE COVENANTS.....................................................51
      6.1          Accounting System............................................51
      6.2          Collateral Reporting.........................................51
      6.3          Financial Statements, Reports, Certificates..................52
      6.4          Servicer Reports.............................................54
      6.5          Return.......................................................55
      6.6          Separate Existence...........................................55
      6.7          Taxes........................................................57
      6.8          [Intentionally Omitted]......................................57
      6.9          Compliance with Laws.........................................57
      6.10         Leases.......................................................57
      6.11         Brokerage Commissions........................................57
      6.12         Existence....................................................57
      6.13         Disclosure Updates...........................................57
      6.14         Purchases....................................................58

7.    NEGATIVE COVENANTS........................................................58
      7.1          Indebtedness.................................................58
      7.2          Liens........................................................58
      7.3          Restrictions on Changes......................................58
      7.4          Disposal of Assets...........................................59
      7.5          Change Name..................................................59
      7.6          Guarantee....................................................59
      7.7          Nature of Business...........................................59
      7.8          Prepayments and Amendments...................................59
      7.9          Change of Control............................................59
      7.10         Compromise of Accounts.......................................59
      7.11         Distributions................................................59
      7.12         Accounting Methods...........................................60
      7.13         Investments..................................................60
      7.14         Transactions with Affiliates.................................60
      7.15         Suspension...................................................60
      7.16         [Intentionally Omitted]......................................60
      7.17         Use of Proceeds..............................................60
      7.18         Change in Location of Chief Executive Office.................60
      7.19         Securities Accounts..........................................61
      7.20         Financial Covenants..........................................61

                                      -ii-

<PAGE>

8.    EVENTS OF DEFAULT.........................................................64

9.    THE LENDER GROUP'S RIGHTS AND REMEDIES....................................66
      9.1          Rights and Remedies..........................................66
      9.2          Remedies Cumulative..........................................68

10.   TAXES AND EXPENSES........................................................69

11.   WAIVERS; INDEMNIFICATION..................................................69
      11.1         Demand; Protest; etc.........................................69
      11.2         The Lender Group's Liability for Collateral..................69
      11.3         Indemnification..............................................69

12.   NOTICES...................................................................70

13.   CHOICE OF LAW AND VENUE; JURY TRIAL WAIVER................................71

14.   ASSIGNMENTS AND PARTICIPATIONS; SUCCESSORS................................72
      14.1         Assignments and Participations...............................72
      14.2         Successors...................................................75

15.   AMENDMENTS; WAIVERS.......................................................75
      15.1         Amendments and Waivers.......................................75
      15.2         Replacement of Holdout Lender................................76
      15.3         No Waivers; Cumulative Remedies..............................76

16.   AGENT; THE LENDER GROUP...................................................77
      16.1         Appointment and Authorization of Agent.......................77
      16.2         Delegation of Duties.........................................77
      16.3         Liability of Agent...........................................78
      16.4         Reliance by Agent............................................78
      16.5         Notice of Default or Event of Default........................78
      16.6         Credit Decision..............................................79
      16.7         Costs and Expenses; Indemnification..........................79
      16.8         Agent in Individual Capacity.................................80
      16.9         Successor Agent..............................................80
      16.10        Lender in Individual Capacity................................80
      16.11        Withholding Taxes............................................81
      16.12        Collateral Matters...........................................83
      16.13        Restrictions on Actions by Lenders; Sharing of Payments......83
      16.14        Agency for Perfection........................................84
      16.15        Payments by Agent to the Lenders.............................84
      16.16        Concerning the Collateral and Related Loan Documents.........84
      16.17        Field Audits and Examination Reports; Confidentiality;
                         Disclaimers by Lenders; Other Reports and Information..85
      16.18        Several Obligations; No Liability............................86

17.   GENERAL PROVISIONS........................................................86
      17.1         Effectiveness................................................86

                                      -iii-

<PAGE>

      17.2         Section Headings.............................................86
      17.3         Interpretation...............................................86
      17.4         Severability of Provisions...................................87
      17.5         Amendments in Writing........................................87
      17.6         Counterparts; Telefacsimile Execution........................87
      17.7         Revival and Reinstatement of Obligations.....................87
      17.8         Integration..................................................87

</TABLE>

                                      -iv-

<PAGE>

                             EXHIBITS AND SCHEDULES

Exhibit A-1                               Form of Assignment and Acceptance
Exhibit B-1                               Form of Borrowing Base Certificate
Exhibit C-1                               Form of Compliance Certificate

Schedule C-1                              Commitments
Schedule C-2                              Credit and Collection Policies
Schedule S-1                              Sale/Leaseback Transactions
Schedule 2.8(a)                           Cash Management Banks
Schedule 5.3                              Chief Executive Office; FEIN
Schedule 5.4(b)                           Capitalization of Borrower
Schedule 5.6                              Litigation
Schedule 5.7                              Material Adverse Change
Schedule 5.14                             Demand Deposit Accounts

<PAGE>

                                  Schedule C-1

                                   COMMITMENTS

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

                   LENDER                            COMMITMENT
------------------------------------- ------------------------------------------
------------------------------------- ------------------------------------------

Foothill Capital Corporation                         $30,000,000
------------------------------------- ------------------------------------------
------------------------------------- ------------------------------------------

Ableco Finance LLC                                   $10,000,000
------------------------------------- ------------------------------------------
------------------------------------- ------------------------------------------

All Lenders                                          $40,000,000
------------------------------------- ------------------------------------------

<PAGE>

                                   EXHIBIT A-1

                   FORM OF ASSIGNMENT AND ACCEPTANCE AGREEMENT

           This ASSIGNMENT AND ACCEPTANCE AGREEMENT ("Assignment Agreement") is
entered into as of ________________ between ("Assignor") and
_____________________________ ("Assignee"). Reference is made to the Agreement
described in ITEM 2 of ANNEX I annexed hereto (the "Loan Agreement").
Capitalized terms used herein and not otherwise defined shall have the meanings
ascribed to them in the Loan Agreement.

           1. In accordance with the terms and conditions of Section 14 of the
Loan Agreement, the Assignor hereby sells and assigns to the Assignee, and the
Assignee hereby purchases and assumes from the Assignor, that interest in and to
the Assignor's rights and obligations under the Loan Documents as of the date
hereof with respect to the Obligations owing to the Assignor, and Assignor's
portion of the Commitments, as specified in ITEM 4.B and ITEM 4.C of ANNEX I.
After giving effect to such sale and assignments, the Assignee's portion of the
Commitments will be as set forth in ITEM 4.B of Annex I. After giving effect to
such sale and assignment, the Assignor's amount and portion of the Commitments
will be as set forth in ITEM 4.D and ITEM 4.E of Annex I.

           2. The Assignor: (a) represents and warrants that it is the legal and
beneficial owner of the interest being assigned by it hereunder and that such
interest is free and clear of any adverse claim; (b) makes no representation or
warranty and assumes no responsibility with respect to any statements,
warranties or representations made in or in connection with the Transaction
Documents or the execution, legality, validity, enforceability, genuineness,
sufficiency or value of the Transaction Documents or any other instrument or
document furnished pursuant thereto; and (c) makes no representation or warranty
and assumes no responsibility with respect to the financial condition of
Borrower, Servicer, Parent, any Originator or any other Company or the
performance or observance by Borrower, Servicer, Parent or any Originator of any
of their respective obligations under the Transaction Documents or any other
instrument or document furnished pursuant thereto.

           3. The Assignee: (a) confirms that it has received copies of the Loan
Agreement and the other Transaction Documents, together with copies of the
financial statements referred to therein and such other documents and
information as it has deemed appropriate to make its own credit analysis and
decision to enter into this Assignment Agreement; (b) agrees that it will,
independently and without reliance, based on such documents and information as
it shall deem appropriate at the time, continue to make its own credit decisions
in taking or not taking action under the Transaction Documents; (c) confirms
that it is eligible as an assignee under the terms of the Loan Agreement; (d)
appoints and authorizes the Agent to take such action as agent on its behalf and
to exercise such powers under the Transaction Documents as are delegated to
Agent by the terms thereof, together with such powers as are reasonably
incidental thereto; (e) agrees that it will perform in accordance with their
terms all of the obligations which by the terms of the Transaction Documents are
required to be performed by it as a Lender [and (f) attaches the forms

<PAGE>

prescribed by the Internal Revenue Service of the United States certifying as to
the Assignee's status for purposes of determining exemption from United States
withholding taxes with respect to all payments to be made to the Assignee under
the Loan Agreement or such other documents as are necessary to indicate that all
such payments are subject to such rates at a rate reduced by an applicable tax
treaty.]

           4. Following the execution of this Assignment Agreement by the
Assignor and Assignee, it will be delivered by the Assignor to the Agent for
recording by the Agent. The effective date of this Assignment (the "Settlement
Date") shall be the later of (a) (i) the date of the execution hereof by the
Assignor and the Assignee, (ii) if required pursuant to Section 14 of the Loan
Agreement, the payment by Assignor or Assignee to Agent for Agent's sole and
separate account of a processing fee in the amount of $5,000, and (iii) the
receipt of any required consent of the Agent, and (b) the date specified in ITEM
5 of ANNEX I.

           5. Upon recording by the Agent, as of the Settlement Date (a) the
Assignee shall be a party to the Loan Agreement and, to the extent of the
interest assigned pursuant to this Assignment Agreement, have the rights and
obligations of a Lender thereunder and under the other Transaction Documents,
and (b) the Assignor shall, to the extent of the interest assigned pursuant to
this Assignment Agreement, relinquish its rights and be released from its
obligations under the Loan Agreement and the other Transaction Documents.

           6. Upon recording by the Agent, from and after the Settlement Date,
the Agent shall make all payments under the Loan Agreement and the other
Transaction Documents in respect of the interest assigned hereby (including,
without limitation, all payments of principal, interest and fees (if applicable)
with respect thereto) to the Assignee. Upon the Settlement Date, the Assignee
shall pay to the Assignor the Assigned Share (as set forth in ITEM 4.B of Annex
I) of the principal amount of any outstanding Advances under the Loan Agreement.
The Assignor and Assignee shall make all appropriate adjustments in payments
under the Loan Agreement and the other Transaction Documents for periods prior
to the Settlement Date directly between themselves on the Settlement Date.

           7. THIS ASSIGNMENT AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND
ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.

                  [Remainder of page left intentionally blank.]

                                      -2-
<PAGE>

           IN WITNESS WHEREOF, the parties hereto have caused this Assignment
Agreement and Annex I hereto to be executed by their respective officers
thereunto duly authorized, as of the first date above written.

                                         [NAME OF ASSIGNOR]

                                           as Assignor

                                         By:
                                              ----------------------------------

                                         Title:
                                                 -------------------------------

                                         [NAME OF ASSIGNEE]

                                           as Assignee

                                         By:
                                              ----------------------------------

                                         Title:
                                                 -------------------------------

ACCEPTED THIS ____ DAY OF

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

FOOTHILL CAPITAL CORPORATION
AS AGENT

By:
     ----------------------------------------------------

Title:
        -------------------------------------------------

                                      -3-
<PAGE>

                       ANNEX FOR ASSIGNMENT AND ACCEPTANCE

                                     ANNEX I

1.   Borrower: Foster Wheeler Funding LLC, a Delaware limited liability company

2.   Name and Date of Loan Agreement:

                               Loan and Security Agreement, dated as of August
                               15, 2002, among Borrower, the lenders signatory
                               thereto as the Lenders, and Foothill Capital
                               Corporation, a California corporation, as the
                               arranger and administrative agent for the
                               Lenders.

3.   Date of Assignment Agreement:                 ---------------------

4.   Amounts:

a.   Assignor's Commitment                        $ --------------------

b.   Assigned Share of Commitment                 % ----------------------

c.   Assigned Amount of Commitment                $ --------------------

d.   Resulting Amount of Assignor's Commitment after giving effect to the
     Assignment to Assignee
                                                  $ --------------------

e.   Assignor's Resulting Share of Commitment after giving effect to the
     Assignment to Assignee
                                                  % ----------------------

5.   Settlement Date:                             ---------------------

6.   Notice and Payment Instructions, etc.

           Assignee:                             Assignor:

7.         Agreed and Accepted:

           [ASSIGNOR]                            [ASSIGNEE]

By:                                           By:
     ------------------------------                -----------------------------
Title:                                        Title:
        ---------------------------                 ----------------------------

                                      -4-
<PAGE>

Accepted:

FOOTHILL CAPITAL CORPORATION, as Agent

By:
     -----------------------------------------------
Title:
        --------------------------------------------

                                      -5-
<PAGE>

9268462.4

                                   EXHIBIT B-1

                       FORM OF BORROWING BASE CERTIFICATE

Foothill Capital Corporation, as Agent
under the below referenced Loan Agreement
One Boston Place
Suite 1800
Boston, Massachusetts  02108

                     The undersigned, the [chief financial officer] of FOSTER
WHEELER FUNDING LLC, a Delaware limited liability
company ("Borrower"), pursuant to SECTION 6.2(F) of that certain Loan and
Security Agreement, dated as of August 15, 2002 ( the "Loan Agreement"), entered
into among Borrower, the lenders signatory thereto (the "Lenders"), and Foothill
Capital Corporation, a California corporation, as the arranger and
administrative agent for the Lenders ("Agent"), hereby certifies to Agent that
the following items, calculated in accordance with the terms and definitions set
forth in the Loan Agreement for such items are true and correct, and that
Borrower is in compliance with and, after giving effect to any currently
requested Loans, will be in compliance with the terms, conditions, and
provisions of the Loan Agreement.

                     All initially capitalized terms used in this Borrowing Base
Certificate have the meanings set forth in the Loan
Agreement unless specifically defined herein.

Effective Date of Calculation:
                              --------------------------------------------

A.    BORROWING BASE CALCULATION

1.   Accounts:

     a.       (1) Amount of Eligible Accounts (as detailed on
              SCHEDULE A.1 attached hereto and incorporated herein by
              this reference):
                                                                  $------------

              (2) Amount, if any, of the Dilution Reserve:
                                                                  $------------

              (3) Net Eligible Accounts
              (ITEM A(1) MINUS ITEM A(2)):                        $____________

              (4)      Advance rate against Net Eligible Accounts (from
              SECTION 2.1(A)(X)(I) of the Loan Agreement):
                                                                   ______85%___

                                 ITEM A(3) TIMES ITEM A(4) =      $____________

                                      -1-
<PAGE>

     b.       Borrower's Collections with respect to Accounts for the
              immediately preceding 30-day period:
                                                                  $------------

                                THE LESSER OF ITEMS A AND B =     $____________

2.   Reserves established by Agent under SECTION 2.1(B) of the Loan
     Agreement                                                    $____________

                                ITEM 1 MINUS ITEM 2 =             $____________

B.   AVAILABILITY CALCULATION

1.   Maximum Revolver Amount                                      $40,000,000

2.   Borrowing Base (from Section A)                              $____________

3.   Availability

     a.      Permitted Advances
             (THE LESSER OF ITEM 1 AND ITEM 2):                   $____________

     b.      Aggregate amount of outstanding Advances:
                                                                  $------------

                                 ITEM A MINUS ITEM B =            $____________

                  [Remainder of page intentionally left blank.]

                                      -2-
<PAGE>

           The undersigned hereby certifies that all of the foregoing is true
and correct as of the effective date of the calculations set forth above and
that such calculations have been made in accordance with the requirements of the
Loan Agreement.

                                 FOSTER WHEELER FUNDING LLC,
                                 a Delaware limited liability company,
                                 as Borrower

                                 By:
                                      ------------------------------------------

                                 Name:
                                       -----------------------------------------

                                 Title:
                                        ----------------------------------------

                                      -3-
<PAGE>

                                  SCHEDULE A.1
                               (ELIGIBLE ACCOUNTS)

                             CONTINUED ON NEXT PAGE

                                      -4-
<PAGE>

                                   EXHIBIT C-1
                   (Form of Compliance Certificate - Borrower)

                        [on Foster Wheeler's letterhead]

To:        Foothill Capital Corporation, as Agent
           under the below-referenced Loan Agreement
           One Boston Place
           18th Floor
           Boston, Massachusetts 02108
           Attn:     Business Finance Division Manager

                     Re:       Compliance Certificate dated   ______________

Ladies and Gentlemen:

           Reference is made to that certain Loan and Security Agreement, dated
as of August 15, 2002 (the "LOAN Agreement") among Foster Wheeler Funding LLC, a
Delaware limited liability company ("BORROWER"), the lenders signatory thereto
(the "LENDERS"), and Foothill Capital Corporation, a California corporation, as
the arranger and administrative agent for the Lenders ("AGENT"). Capitalized
terms used in this Compliance Certificate have the meanings set forth in the
Loan Agreement unless specifically defined herein.

           Pursuant to SECTION 6.3 of the Loan Agreement, the undersigned
officer of Borrower hereby certifies that:

           1. The financial information of Borrower furnished in Schedule 1
attached hereto, has been prepared in accordance with GAAP (except for year-end
adjustments and the lack of footnotes, in the case of financial statements
delivered under Section 6.3(a) of the Loan Agreement) and fairly presents the
financial condition of Borrower as at such date.

           2. Such officer has reviewed the terms of the Loan Agreement and has
made, or caused to be made under his/her supervision, a review in reasonable
detail of the transactions and condition of Borrower during the accounting
period covered by the financial statements delivered pursuant to Section 6.3 of
the Loan Agreement.

           3. Such review has not disclosed the existence on and as of the date
hereof, and the undersigned does not have knowledge of the existence as of the
date hereof, of any event or condition that constitutes a Default or Event of
Default, except for such conditions or events listed on Schedule 2 attached
hereto, specifying the nature and period of existence thereof and what action
Borrower has taken, is taking, or proposes to take with respect thereto.

<PAGE>

           4. The representations and warranties of the Borrower set forth in
the Loan Agreement and the other Loan Documents are true and correct in all
material respects as of the date hereof (except to the extent that such
representations and warranties relate solely to an earlier date, in which case
such representations and warranties are true and correct as of such earlier
date). Borrower is in timely compliance with all covenants set forth in the Loan
Agreement and the other Loan Documents, except as set forth on Schedule 2
attached hereto. Without limiting the generality of the foregoing, Borrower is
in compliance with the covenants contained in Section 7.20 of the Loan Agreement
as demonstrated on Schedule 3 hereof.

           IN WITNESS WHEREOF, this Compliance Certificate is executed by the
undersigned this _____ day of ---------------, --------.

                                 FOSTER WHEELER FUNDING LLC
                                 a Delaware limited liability company,
                                 as Borrower

                                  By:
                                          --------------------------------------
                                          Name:
                                          Title:

<PAGE>

                                   SCHEDULE 3

1.         MINIMUM COLLECTIONS.
           -------------------

                     At the end of the week ending _________, 20__, the average
           amount of weekly Collections with respect to Borrower's Accounts
           during the Testing Period ending at the end of such week was not less
           than $15,000,000; PROVIDED, HOWEVER, that the calculation of weekly
           Collections determined under this paragraph 1 shall include all
           amounts not exceeding $4,000,000 paid to subcontractors for goods
           and/or services that, pursuant to the terms of any commercial
           contract between an Originator and its client, such Originator pays
           such subcontractor (on behalf of, and as agent for, such client)
           directly from the client's funds.

2.         MINIMUM PURCHASES.
           -----------------

                     At the end of the week ending _________, 20__, the average
           amount of Subject Accounts purchased by, or contributed to, the
           Borrower each week pursuant to the Purchase Agreement during the
           Testing Period ending at the end of such week was not less than
           $18,000,000; PROVIDED, HOWEVER, that the calculation of weekly
           purchases and contributions determined under this paragraph 2 shall
           include amounts not exceeding $4,000,000 invoiced by any Originator
           for subcontractor services for which, pursuant to the terms of a
           commercial contract between such Originator and its client, such
           Originator acts as agent for the client and pays for subcontractor
           goods and services directly from the client's funds.

3.         DILUTION.
           --------

(a)        Dilution for the Borrower for the six-month period ending _________,
           20__, the date of determination, is calculated as follows:

               (i)  the aggregate dollar amount of bad debt write downs,
                    discounts, advertising allowances, credits and other
                    dilutive items with respect to the Accounts during the
                    immediately preceding six-month period ending on the date of
                    determination:                                  $___________

               (ii) Borrower's Collections with respect to Accounts (excluding
                    extraordinary items) during the immediately preceding
                    six-month period ending on the date of determination:
                                                                    $___________

<PAGE>

  Item (i) divided by the sum of Item (i) plus Item (ii), expressed as

           a percentage = Dilution:                                 ___________%

           (b) Dilution of the Borrower for the six-month period ending on the
date of determination, is not greater than 18%.

4.         A/R TURNOVER PERIOD.
           -------------------

           (a) The A/R Turnover Period of Borrower for the month ending
_________, 20__, is calculated for such month as follows:

           (i) aggregate amount of Accounts as of the first day of such month:
                                                                    $___________

           (ii) aggregate amount of Collections with respect to Accounts during
such month:                                                         $___________

           A fraction, the numerator of which is Item (i) and the denominator of
which is Item (ii), times 30 days = A/R Turnover Period: ______ days

           (b) The A/R Turnover Period of the Borrower for the month ending
_________, 20__, is not greater than 80 days.

5.         DELINQUENCY RATIO.
           -----------------

           (a) Delinquency Ratio of the Borrower, as of _________, 20__, the
date of determination, is calculated as follows:

           (i) aggregate amount of all Accounts as to which payment, or any part
thereof, remains unpaid for more than 90 days from the original invoice date:
                                                                    $___________
           (ii) aggregate amount of all Accounts:                   $___________

           The ratio of Item (i) to Item (ii), expressed as a percentage =
Delinquency Ratio:                                                  ___________%

           (b) Delinquency Ratio of the Borrower, as of __________, 20____, is
not greater than 50%.

6.         MINIMUM TANGIBLE NET WORTH.
           --------------------------

           (a) The Tangible Net Worth of Borrower, as of the last day of the
month ending _________, 20__, is calculated as follows:

<PAGE>

(i) Borrower's total stockholder equity at book value:              $___________

(ii) all Intangible Assets of Borrower:                             $___________

(iii) all of Borrower's prepaid expenses:                           $___________

(iv) all amounts due to Borrower from Affiliates, calculated on a
                             consolidated basis:                    $___________

  Item (i) minus the sum of (Item (ii) plus
                               Item (iii) plus Item (iv))
                               = Tangible Net Worth:                $___________

           (b) The Tangible Net Worth of the Borrower, as of ___________, 20___,
set forth above is not less $5,000,000.

7.         MINIMUM EBITDA.
           --------------

                     Consolidated Adjusted EBITDA for the four fiscal quarters
           ended ___________, is $_______________, which amount [is/is not]
           greater than or equal to the amount set forth in Section 7.20(b)(i)
           of the Loan Agreement for the corresponding period.

8.         SENIOR DEBT RATIO.
           -----------------

                     The ratio of (i) Senior Debt to (ii) Consolidated Adjusted
           EBITDA for the four fiscal quarters ended ___________, is _____ to
           ______, which ratio [is/is not] less than or equal to the ratio set
           forth in Section 7.20(b)(ii) of the Loan Agreement for the
           corresponding period.

9.         CAPITAL EXPENDITURES.
           --------------------

                     No capital expenditures have been made or committed to be
made by the Borrower.

<PAGE>

                                   EXHIBIT C-2
                  (Form of Compliance Certificate - Originator)

                          [on Originator's letterhead]

To:        Foothill Capital Corporation, as Agent
           under the below-referenced Loan Agreement
           One Boston Place
           18th Floor
           Boston, Massachusetts 02108
           Attn:     Business Finance Division Manager

                     Re:       Compliance Certificate dated   ______________

Ladies and Gentlemen:

                     Reference is made to that certain Loan and Security
Agreement, dated as of August 15, 2002 (the "LOAN
Agreement") among Foster Wheeler Funding LLC, a Delaware limited liability
company ("BORROWER"), the lenders signatory thereto (the "LENDERS"), and
Foothill Capital Corporation, a California corporation, as the arranger and
administrative agent for the Lenders ("AGENT"). Capitalized terms used in this
Compliance Certificate have the meanings set forth in the Loan Agreement unless
specifically defined herein.

           Pursuant to SECTION 6.3 of the Loan Agreement, the undersigned
officer of ___________ ("Originator") hereby certifies that:

1. The financial information of Originator furnished in Schedule 1 attached
hereto, has been prepared in accordance with GAAP (except for year-end
adjustments and the lack of footnotes, in the case of financial statements
delivered under Section 6.3(a) of the Loan Agreement) and fairly presents the
financial condition of Originator.

2. The Projections of Originator furnished in Schedule 2 attached hereto
constitute such officer's good faith best estimate of Originator 's financial
performance during the period covered thereby.

<PAGE>

           IN WITNESS WHEREOF, this Compliance Certificate is executed by the
undersigned this _____ day of ---------------, --------.

                                 a                                        ,
                                   ---------------------------------------
                                  as Originator

                                 By:
                                     -------------------------------------------
                                     Name:
                                     Title:

<PAGE>

                                   EXHIBIT C-3
                  (Form of Compliance Certificate - Guarantor)

                           [on Guarantor's letterhead]

To:        Foothill Capital Corporation, as Agent
           under the below-referenced Loan Agreement
           One Boston Place
           18th Floor
           Boston, Massachusetts 02108
           Attn:     Business Finance Division Manager

                     Re:       Compliance Certificate dated   ______________

Ladies and Gentlemen:

           Reference is made to that certain Performance Guaranty, dated as of
August 15, 2002 (the "GUARANTY") by Foster Wheeler, Ltd. (the "GUARANTOR") in
favor of Foothill Capital Corporation, a California corporation, as the arranger
and administrative agent for the Lenders (defined below) ("AGENT") pursuant to
that certain Loan and Security Agreement, dated as of August ___, 2002 (the
"LOAN AGREEMENT") among Foster Wheeler Funding LLC, a Delaware limited liability
company ("BORROWER"), the lenders signatory thereto (the "LENDERS"), and the
Agent. Capitalized terms used in this Compliance Certificate have the meanings
set forth in the Guaranty and the Loan Agreement unless specifically defined
herein.

           Pursuant to SECTION 7(B) of the Guaranty, the undersigned officer of
Foster Wheeler Ltd. hereby certifies that the financial information of Guarantor
and its Subsidiaries furnished in Schedule 1 attached hereto, has been prepared
in accordance with GAAP (except for year-end adjustments and the lack of
footnotes, in the case of financial statements delivered under Section 7(b)(ii)
of the Guaranty) and fairly presents the financial condition of Guarantor and
its Subsidiaries on a consolidated basis.

<PAGE>

           IN WITNESS WHEREOF, this Compliance Certificate is executed by the
undersigned this _____ day of ---------------, --------.

                                 FOSTER WHEELER LTD.,
                                 a Bermuda limited company,
                                  as Guarantor

                                 By:
                                     -------------------------------------------
                                     Name:
                                     Title:

<PAGE>

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