Document:

<PAGE>
                                                                   Exhibit 10.37

                               AGREEMENT OF LEASE

                                     between

                           ANNOD CORP., not personally
                            but solely as trustee of
                               The Bayview Trust,

                                    Landlord

                                       and

                              Hewitt Associates LLC

                                     Tenant

<PAGE>

                                TABLE OF CONTENTS
<TABLE>
<CAPTION>
SECTION                                                                                    Page

<S>     <C>                                                                                <C>
        Lease Preamble ................................................................      4

 1.     Premises ......................................................................      6

 2.     Term ..........................................................................      6

 3.     The Base Rent .................................................................      6

 4.     Tax Rent ......................................................................      7

 5.     Operating Expense Rent ........................................................      9

 6.     Capital Expense Rent ..........................................................      9

 7.     Use ...........................................................................     11

 8.     Utilities and Services ........................................................     11

 9.     Parking .......................................................................     14

10.     Repairs .......................................................................     14

11.     Condition of Premises .........................................................     16

12.     Inspection and Entry by Landlord ..............................................     16

13.     Alterations ...................................................................     17

14.     Liens .........................................................................     17

15.     Covenants of Tenant ...........................................................     18

16.     Damage to Building ............................................................     18

17.     Insurance .....................................................................     19

18.     Non-Liability of Landlord .....................................................     20

19.     Indemnification ...............................................................     21

20.     Tenant Default ................................................................     21

21.     Remedies ......................................................................     22

22.     Subordination .................................................................     23

23.     Notices .......................................................................     23
</TABLE>

                                       2      Real Estate/Newport Beach Lease(3)

<PAGE>

<TABLE>
<S>     <C>                                                                                <C>
24.     Quiet Enjoyment .................................................................   24

25.     Security Deposit ................................................................   24

26.     Brokerage .......................................................................   24

27.     Landlord's Inability to Perform .................................................   24

28.     Condemnation ....................................................................   25

29.     Assignment and Subletting .......................................................   25

30      Environmental Laws ..............................................................   26

31.     Parties Bound ...................................................................   27

32.     Estoppel Certificate ............................................................   27

33.     Holding Over ....................................................................   28

34.     Attorney's Fees .................................................................   29

35.     Waiver of Jury Trial ............................................................   29

36.     Waiver. .........................................................................   29

37.     Examination of Lease. ...........................................................   29

38.     Corporate Authority. ............................................................   29

39.     No Light, Air or View Easement. .................................................   30

40.     Miscellaneous ...................................................................   30

Exhibit A:     Rules and Regulations ....................................................   32

Exhibit B:     Building Holidays ........................................................   36

Exhibit C:     Legal Description ........................................................   37

Exhibit D:     Alterations to the Premises ..............................................   38

Exhibit E:     Operating and Capital Expense - Exclusions. ..............................   40

Exhibit F      Tenant's Options .........................................................   41

Exhibit G      List of Competitors Excluded from the Building ...........................   45

Exhibit H:     Estoppel Certificate .....................................................   46

Exhibit I:     Drawing of Demised Premises (Commencement Date - October 31, 2002) .......   47

Exhibit J:     Drawing of Demised Premises (November 1, 2002  and thereafter) ...........   48
</TABLE>

                                        3     Real Estate/Newport Beach Lease(3)

<PAGE>

<TABLE>
<S>            <C>                                                                          <C>
Exhibit K:     Form of Subordination, Non-disturbance and Attornment Agreement .........    49
</TABLE>

                                       4      Real Estate/Newport Beach Lease(3)

<PAGE>

                                      LEASE

LEASE AGREEMENT DATED June 1, 2002 between ANNOD CORP., not personally but
solely as trustee of The Bayview Trust ("Landlord"), having an office at 100
Bayview Circle, Newport Beach, CA 92660, and HEWITT ASSOCIATES LLC ("Tenant"),
having an address at 100 Half Day Road, Lincolnshire, Illinois, 60069.

                                 LEASE PREAMBLE

                             BASIC LEASE PROVISIONS

In addition to other terms elsewhere defined in this Lease, the following terms
whenever used in this Lease should have only the meanings set forth in this
Preamble, unless such meanings are expressly modified, limited or expanded
elsewhere herein.

1.       Premises or Demised Premises:

         From the Commencement Date through October 31, 2002, approximately
         152,344 square feet of "Net Rentable Area" (as measured by BOMA
         Standards ANSI Z65.1-1908, for calculating square feet plus 16% (as an
         add on factor)) located on the First, Third, Fourth and Sixth floors,
         together with all fixtures, equipment, improvements and installations
         attached thereto and designated Suite No. 100 in the building (the
         "Building") located at 100 Bayview Circle, Newport Beach, CA, in the
         County of Orange, California (the "Land"), a legal description of which
         is attached hereto and made a part hereof as Exhibit C. The location of
         the Demised Premises in the Building is described on the drawings which
         are attached hereto and made a part hereof as Exhibit I.

         Commencing November 1, 2002, the Demised Premised shall be the
         approximately 92,701 square feet of Net Rentable Area located on the
         First and Fourth floors, together with all fixtures, equipment,
         improvements and installations attached thereto and designated Suite
         No. 100 in the Building. The location of such Demised Premises in the
         Building is described on the drawings which are attached hereto and
         made a part hereof as Exhibit J.

2.       Commencement Date: June l, 2002.

3.       Expiration Date: May 31, 2017.

4.       Term: 15 years, subject to the extension described on Exhibit F.

5.       Permitted Use: General office use and operations ancillary to general
         office use, including on-site food preparation and dining for Tenant's
         employees, invitees and guests.

6.       Base Rent: Forty-One Million Nine Hundred Twenty-Three Thousand Five
         Hundred Three and 58/100 Dollars ($41,923,503.58) from the Commencement
         Date through the Expiration Date.

7.       Base Rent Monthly Installment: Commencement Date through the Expiration
         Date as follows:

         Months     1 - 12   12 months Free Rent/1/
         Months     2 - 24   3 months Free Rent;
                             9 months at $ 214,741.87 per month ($1,932,676.80
                             for 9 months)
         Months    25 - 36   12 months at $ 220,110.41 per month ($2,641,324.96)
                             annually
-----------

/1/ No Rent, as defined in Section 3(b) is payable during, or with respect to,
the Free Rent periods described in this paragraph 7 of the Lease Preamble.

                                       5      Real Estate/Newport Beach Lease(3)

<PAGE>

     Months 37-48      12 months at $ 225,613.17 per month ($ 2,707,358.08)
                       annually

     Months 49-60      12 months at $ 231,253.50 per month ($ 2,775,042.03)
                       annually

     Months 61-72      12 months at $ 237,034.84 per month ($ 2,844,418.08)
                       annually

     Months 73-84      12 months at $ 242,960.71 per month ($ 2,915,528.54)
                       annually

     Months 85-96      12 months at $ 249,034.73 per month ($ 2,988,416.75)
                       annually

     Months 97-108     12 months at $ 255,260.60 per month ($ 3,063,127.17)
                       annually

     Months 109-120    12 months at $ 261,642.11 per month ($ 3,139,705.35)
                       annually

     Months 121-132    12 months at $ 268,183.17 per month ($ 3,218,197.98)
                       annually

     Months 133-144    12 months at $ 274,887.74 per month ($ 3,298,652.93)
                       annually

     Months 145-156    12 months at $ 281,759.94 per month ($ 3,381,119.25)
                       annually

     Months 157-168    12 months at $ 288,803.94 per month ($ 3,465,647.24)
                       annually

     Months 169-180    12 months at $ 296,024.03 per month ($ 3,552,288.42)
                       annually

8.   Lower Level Storage: Tenant shall lease 4,428 sf of lower level storage
     (located in VIP parking area of Building at the rate of $1.00/sf/month
     throughout the Term of the Lease, invoiced by Landlord as Additional Rent.
     Tenant may reduce such storage space, from time to time, on one month's
     notice at any time during the term of the Lease. Once reduced, such square
     footage may not be increased without Landlord's reasonable consent. Any
     demising required by such reduction in leased storage space shall be at
     Tenant's sole cost and expense.

9.   Late Charge: Five percent (5%) of the amount of the payment due if Base
     Rent is not received on the 5th business day of any calendar month, if
     after the 2nd time such late payment is received in any 24 month period
     during the Term.

10.  Base Year: The Base Year shall be June 1, 2002 - May 31, 2003.

11.  Security Deposit: Not applicable.

12.  Proportional Share:

     From the Commencement date through October 31, 2002, 48.08 % based on the
     Premises' Net Rentable Area (152,344 square feet) divided by Net Rentable
     Area of the Building (316,801 square feet).

     Thereafter, 29.26 % based on the Premises' Net Rentable Area (92,701 square
     feet) divided by Net Rentable Area of the Building.

13.  Procuring Broker: None.

14.  Parking Allotment:

     Parking charges are calculated on a per stall basis in accordance with a
     parking ratio of up to four (4) stalls per 1,000 usable square feet, as
     follows: 320 cars allowed:

     Structure (Non-Reserved) Stalls:  No  Charge for 180 months.

     Structure (Reserved) Stalls;      No Charge for 180 months. Spaces allotted
                                       shall not  exceed ten percent (10%) of
                                       total.

     VIP (under Building) Stalls;      No Charge for 180 months. Spaces allotted
                                       shall not exceed five percent (5%) of
                                       total.

     Visitor parking charges as of the Commencement Date are currently $.75 per
     30-minute period after an initial 15-minute grace period. This rate may
     change, per market adjustments, but shall

                                       6      Real Estate/Newport Beach Lease(3)

<PAGE>

     not exceed this rate during the initial fifteen years of the Term.

15.  Building Operating Hours: 7:30 a.m. to 6:30 p.m., Monday through Friday,
     and 8:00 a.m. to 1:00 p.m., Saturdays, excepting holidays generally
     recognized in the State of California.

16.  Tenant Improvement Allowance: None.

17.  Option(s) to Extend: Provided that Tenant is not in default under the Lease
     and with not less than nine (9) months prior written notice, Tenant shall
     have two options to renew the Lease for an additional period of five (5)
     years each at 95% of Fair Market Value. See Exhibit F.

18.  Options to Expand: See Exhibit F.

19.  Option to Audit: See Exhibit F.

THE PARTIES HEREBY AGREE TO THE FOLLOWING TERMS AND CONDITIONS:

1.   Premises

     (a)  The "Premises" shall consist of the area described in paragraph 1 of
          the Lease Preamble, subject to the change in configuration described
          therein.

     (b)  The "Common Areas" of the Building shall be those parts of the
          Building and other improvements within and outside the Building
          designated by Landlord from time to time for the common use of all
          tenants, tenants' employees, customers and invitees, and includes
          among other facilities, corridors, lobbies, plazas, elevators
          (excluding the service elevator connecting the lower level parking
          area, first and fourth floors), delivery passages, drinking fountains,
          public toilets and washrooms, and parking garage, service buildings,
          loading areas, mechanical, electrical and telephone rooms, utilities
          and related facilities, sprinkler, fire detection and fire prevention,
          security equipment, duct shafts, storage areas and service areas and
          similar improvements operated, owned or maintained, in whole or in
          part, by Landlord, and located within or serving the Building and all
          parkways, drives, green-spaces, parks, fountains or other facilities
          owned, operated or maintained, in whole or in part, by Landlord, and
          located within or serving the Building or otherwise made available by
          Landlord for use by all tenants of the Building, all of which
          facilities shall be subject to Landlord's reasonable management and
          control and shall be operated and maintained for the benefit of all
          tenants in a first class manner. Tenant and its employees and invitees
          shall have the nonexclusive right to use the Common Areas, such use to
          be in common with Landlord, other tenants of the Building and other
          persons entitled to use the same.

2.   Term. The Term of this Lease shall commence on the Commencement Date and
     expire on the Expiration Date, unless otherwise extended by one, or both,
     of Tenant's Option(s) to Renew.

3.   The Base Rent

     (a)  Tenant shall pay Base Rent for the Premises in the amounts shown in
          paragraph 7 of the Lease Preamble. All installments of Base Rent are
          payable as described in paragraph 7 of the Lease Preamble in advance
          on the first day of each calendar month during the Term as described
          in paragraph 7 of the Lease Preamble, together with any monthly
          installments of estimated Tax Rent, Operating Expense Rent, and
          Capital Expense Rent (collectively "Total Monthly Rent"). If the
          Commencement Date is not the first day of the calendar month, or the
          Expiration Date is not the last day of the calendar month, the Total
          Monthly Rent shall be prorated based on a thirty (30) day month.

                                       7      Real Estate/Newport Beach Lease(3)

<PAGE>

     (b)  All amounts due or relating to Tenant's occupancy under this Lease,
          other than Total Monthly Rent, are due and payable within forty-five
          (45) days of receipt of Landlord's invoice for same. Such amounts
          include without limitation: annual reconciliations and retroactive
          charges of Tax Rent, Operating Expense Rent or Capital Expense Rent;
          orders for extra work; charges for extra utilities and services; and
          Late Charges (collectively "Additional Rent"). All amounts due under
          this Lease or relating to Tenant's occupancy, including without
          limitation, the Base Rent, the Total Monthly Rent, and Additional Rent
          (collectively, "Rent") are deemed to be rent, receivable as such, and
          subject to all remedies of Landlord for nonpayment of rent. Tenant's
          obligation to pay all amounts owing under this Lease shall survive
          Tenant's relinquishment of possession to Landlord, or the expiration
          or early termination of this Lease.

     (c)  If all or any portion of any installment of Total Monthly Rent is not
          received when due, or if all or any portion of any item of Additional
          Rent is not received by Landlord pursuant to Section 3 (b), the Tenant
          shall pay to Landlord a "Late Charge" of five (5%) percent of the
          overdue amount. Landlord and Tenant agree that the Late Charge
          represents a fair and reasonable estimate of costs that Landlord will
          incur due to Tenant's late payment. Landlord's acceptance of a Late
          Charge shall not constitute a waiver of Tenant's default with respect
          to the overdue amount, or prevent Landlord from exercising any other
          rights and remedies available to Landlord under this Lease or pursuant
          to law.

     (d)  All amounts due Landlord shall be paid by Tenant, without deduction or
          offset (except as set forth herein), in lawful money of the United
          States of America. Payments shall be made at the office of Landlord or
          to such other person or at such other place as Landlord notifies
          Tenant. Landlord reserves the right to require that payments be made
          by certified check or cash.

4.   Tax Rent

     (a)  "Property Taxes" are defined as: all costs and expenses which Landlord
          has incurred or will incur for real and personal property taxes, or
          any other assessments upon Landlord's legal or equitable interest in
          the Land, Building, Common Areas and all or any related facilities and
          improvements (including, without limitation, leasehold taxes or other
          taxes or assessments levied in lieu of or in addition to), whether
          imposed by a government authority or agency, or by a special
          assessment district; any taxes resulting from a reassessment of the
          Building occasioned by any cause whatsoever, including, without
          limitation, any reassessment resulting from a conveyance of Landlord's
          interest in the Land, Building, or Common Areas (whether or not such
          transfer occurs before or after the Commencement Date), or by the
          determination of a court of competent jurisdiction that any law,
          regulation, statute, or constitutional provision purporting to limit
          tax increases is invalid in whole or in part; any non-progressive tax
          on or measured with respect to gross receipts from the rental of space
          in the Building; any user fees or charges assessed for any government
          services which were provided without cost prior to the imposition of
          Proposition 13; any assessment, tax, fee, charge, or levy for any
          transportation plan, fund, or system within the general geographic
          area of the Building; and, any reasonable expenses of Landlord in
          contesting any of the foregoing or the assessed valuation of the Land,
          Building, or Common Areas. Notwithstanding the foregoing, the
          definition of "Property Taxes" excludes any net income, franchise,
          capital stock, estate, or inheritance taxes. If an assessment is
          payable in installments, Property Taxes for the year shall include the
          amount of the installment due and payable during that year. For all
          other real estate taxes, Property Taxes for that year shall include
          the amount due and payable for that year. If a change in Property
          Taxes is obtained for any year of the Term, then Property Taxes for
          that year will be retroactively adjusted and Landlord shall provide
          Tenant with a credit, if any, based on the adjustment. In no event
          shall Landlord collect any amounts with respect to Property Taxes
          which would, when taken together with those amounts collected by
          Landlord from other tenants in the Building (and in the event the
          Building is less than 100% occupied, paid directly by Landlord),
          exceed 95% of the actual Property Taxes for any calendar year.
          Property Taxes shall not include (i) any

                                        8     Real Estate/Newport Beach Lease(3)

<PAGE>

          late charges assessed due to Landlord's failure to timely pay taxes,
          (ii) taxes on or relating to inheritance, estate, succession,
          transfer, gift, franchise, net profits or income tax imposed by
          Landlord or agents of Landlord and (iii) any proprietary tax credits
          which inure by statute to the benefit of any tenant without benefit to
          Landlord. In addition, with respect to any assessments included within
          the term Property Taxes, where such assessments are or may by election
          be payable in installments over more than one calendar year, such
          assessments shall be allocated over the maximum period available under
          such election, irrespective of whether or over what period Landlord
          may in fact elect to pay such installments.

     (b)  For each successive June 1-May 31 period during the Term after the
          Base Year ("Comparison Year"), Tenant shall pay to Landlord "Tax
          Rent," which shall be the Proportional Share of the amount, if any,
          which the aggregate annual Property Taxes for the Comparison Year
          exceeds the Property Taxes for the Base Year. Tax Rent is payable in
          the manner set forth in Section 3.(a). If this Lease terminates on a
          day other than the last day of the Comparison Year, Tax Rent for the
          Comparison Year shall be prorated on a thirty (30) day month basis.

     (c)  As soon as practical after the beginning of each Comparison Year (but
          in no event later than 120 days after the close of the applicable
          Comparison Year), Landlord shall provide Tenant with an estimate of
          Property Taxes and Tax Rent for the Comparison Year. If the estimated
          Tax Rent for the Comparison Year is not determined until after the
          beginning of the Comparison Year, then Tenant shall continue to pay
          the monthly installments for the prior Comparison Year, if any, and
          shall retroactively pay any underpayment of estimated Tax Rent payable
          for the period from the beginning of the Comparison Year until the
          estimate was provided. As soon as practical after the end of each
          Comparison Year (but in no event later than 120 days after the close
          of the applicable Comparison Year), Landlord shall determine the
          Property Taxes incurred in the Comparison Year. If Tenant has
          underpaid its Tax Rent for the Comparison Year, then Tenant shall pay
          to Landlord the full amount of such deficiency as Additional Rent. If
          Tenant has overpaid its Tax Rent for the Comparison Year, the Landlord
          shall either credit the overpayment toward Tenant's next
          installment(s) of Total Monthly Rent or, if this Lease has terminated
          and Tenant is not in monetary or financial default, refund the
          overpayment to Tenant within thirty (30) days of determination.

     (d)  If the value of the improvements in the Premises (regardless of
          whether such improvements were installed or paid for by Landlord or
          Tenant, or have been affixed to the real property to become a part
          thereof) exceed the value of improvements generally prevailing in
          other leased premises in the Building, then Tenant shall pay to
          Landlord as Additional Rent all Property Taxes levied on such excess
          value. If the records of the County Assessor are available and
          sufficiently detailed to serve as a basis for determining such excess
          value, then such records shall be binding on Landlord and Tenant;
          otherwise, the actual cost of construction shall be determinative.

     (e)  Tenant shall directly pay the taxing authority any tax levied against
          the personal property or trade fixtures of Tenant in or about the
          Premises. If Tenant fails to pay such tax before delinquency, then
          Landlord may pay such tax on behalf of Tenant (after providing Tenant
          with advance written notice and ten (10) days to cure), and the amount
          paid shall constitute Additional Rent due Landlord.

     (f)  The calculation and payment of Tax Rent is separate, distinct, and
          shall not be affected by the calculation and payment of either Basic
          Monthly Rent, Operating Expense Rent, or Capital Expense Rent. Any
          item of cost or expense included as Property Taxes shall not be
          included as either Operating Expenses or Capital Expenses.

5.   Operating Expense Rent

                                        9     Real Estate/Newport Beach Lease(3)

<PAGE>

     (a)  "Operating Expenses" include, without limitation, costs and expenses
          for: all wages, salaries, benefits, payroll taxes, other similar
          government charges and other direct costs of personnel rendering
          services to the Building, whether or not situated in the Building,
          including, without limitation, Building managers and their assistants,
          clerical, accounting, and technical services personnel; utility
          charges and surcharges; janitorial, mechanical, security, landscaping,
          elevator, waste disposal, alarm maintenance, and other Building
          services; parking facility operation, maintenance and management;
          lighting; air conditioning; heating; ventilating; water and sewage
          charges; supplies; materials; tools; equipment; uniforms; operation,
          maintenance, and repair of systems and facilities; structural and
          non-structural repair; business licenses or similar licenses or taxes;
          insurance premiums, deductibles and related charges, whether required
          pursuant to this Lease or by any lien-holder or encumbrancer;
          professional fees and other expenses; reasonable property management
          fees, not in excess of 2.5% of the Building revenues, and the expenses
          of maintaining a Building management office, with rent imputed at
          Landlord's scheduled rate for the building containing the office.
          Operating Expenses excludes those items described on Exhibit E
          attached hereto.

     (b)  "Operating Expenses" are calculated as if the Building were
          ninety-five percent (95%) occupied and all services were provided to
          the entire Building.

     (c)  For each Comparison Year, Tenant shall pay to Landlord "Operating
          Expense Rent," which shall be Tenant's Proportional Share of the
          amount, if any, by which the aggregate annual Operating Expenses for
          the Comparison Year exceed the Operating Expenses for the Base Year.
          Operating Expense Rent is payable in the manner set forth in Section
          3.(a). If this Lease terminates on a day other than the last day of
          the Comparison Year, then Operating Expense Rent for the Comparison
          Year shall be prorated on a thirty (30) day month basis.

     (d)  As soon as practical after the beginning of each Comparison Year (but
          in no event later than 120 days after the close of the applicable
          Comparison Year), Landlord shall provide Tenant with Landlord's
          estimate of Operating Expenses and Operating Expense Rent for the
          Comparison Year. During the Comparison Year, Tenant shall pay
          Landlord's estimated Operating Expense Rent in equal monthly
          installments on or before the first day of each month. If the
          estimated Operating Expense Rent for the Comparison Year is not
          determined until after the beginning of the Comparison Year, then
          Tenant shall continue to pay the monthly installments for the prior
          Comparison Year, if any, and shall retroactively pay any underpayment
          of estimated Operating Expense Rent payable for the period from the
          beginning of the Comparison Year until the estimate was provided. As
          soon as practical after the end of each Comparison Year (but in no
          event later than 120 days after the close of the applicable Comparison
          Year), Landlord shall determine the Operating Expenses incurred in the
          Comparison Year. If Tenant has underpaid its Operating Expense Rent
          for the Comparison Year, then Tenant shall pay to Landlord the full
          amount of such deficiency as Additional Rent. If Tenant has overpaid
          its Operating Expense Rent for the Comparison Year, then Landlord
          shall either credit the overpayment toward Tenant's next
          installment(s) of Total Monthly Rent or, if this Lease has terminated
          and Tenant is not in default, refund the overpayment to Tenant within
          thirty (30) days of determination.

     (e)  The calculation and payment of Operating Expense Rent is separate,
          distinct, and shall not be affected by the calculation and payment of
          either Basic Monthly Rent, Tax Rent, or Capital Expense Rent. Any item
          of cost or expense included as Operating Expenses shall not be
          included as either Property Taxes or Capital Expenses.

6.   Capital Expense Rent

     (a)  "Capital Expenses" are defined as all costs and expenses which
          Landlord has incurred or will incur (without offset for any revenue
          derived from any source whatsoever) in the making or

                                      10      Real Estate/Newport Beach Lease(3)

<PAGE>

          installation of capital improvements, modifications, or additions to
          the Land, Building, Common Areas, and/or the machinery, equipment, and
          facilities related thereto, either:

          (i)   Required by directive of a government, quasi-government, or
                regulatory agency or authority pursuant to either a law or
                statute newly enacted after the Commencement Date, or a
                regulatory interpretation of a law or statute existing as of the
                Commencement Date, which regulatory interpretation is newly
                promulgated after the Commencement Date and is materially
                different than the existing regulatory interpretation;

          (ii)  Made with the intent of reducing Operating Expenses (but only to
                the extent such capital improvement actually reduces Operating
                Expenses); or

          (iii) Deemed reasonably necessary by Landlord to maintain the quality,
                integrity and/or Class "A" character of the Land, Building,
                Common Areas and/or the machinery, equipment and facilities
                related thereto.

          Capital Expenses excludes those items described on Exhibit E attached
          hereto.

     (b)  During the Term, Tenant shall pay Landlord "Capital Expense Rent,"
          which shall be the Proportional Share (or any other proportion, in
          Landlord's reasonable discretion, which equitably distributes either
          Capital Expenses or Capital Expense Rent among tenants) of any Capital
          Expenses amortized over such reasonable period as Landlord shall
          reasonably determine with a return on capital at the current market
          rate per annum on the un-amortized balance or at such higher rate as
          may have been paid by the Landlord. Capital Expense Rent is payable in
          the manner set forth in Section 3.(a). If this Lease commences or
          terminates on a day other than the first or last day of a calendar
          year, Capital Expense Rent for the year shall be prorated on a thirty
          (30) day month basis.

     (c)  As soon as practical after the beginning of each Comparison Year (but
          in no event later than 120 days after the beginning of each Comparison
          Year), Landlord shall provide Tenant with Landlord's estimate of the
          Capital Expenses and Capital Expense Rent for the Comparison Year.
          During the Comparison Year, Tenant shall pay Landlord's estimated
          Capital Expense Rent in equal monthly installments on or before the
          first day of each month. If the estimated Capital Expense Rent for the
          Comparison Year is not determined until after the beginning of the
          Comparison Year, then Tenant shall continue to pay the monthly
          installments for the prior Comparison Year, if any, and shall
          retroactively pay any underpayment of estimated Capital Expense Rent
          payable for the period from the beginning of the Comparison Year until
          the estimate was provided. As soon as practical after the end of each
          Comparison Year (but in no event later than 120 days after the
          beginning of each Comparison Year), Landlord shall determine the
          Capital Expenses incurred, allocated, or amortized in the calendar
          year. If Tenant has underpaid its Capital Expense Rent for the
          Comparison Year, then Tenant shall pay to Landlord the full amount of
          such deficiency as Additional Rent. If Tenant has overpaid its Capital
          Expense Rent for the Comparison Year, then Landlord shall either
          credit the overpayment toward Tenant's next installment(s) of Total
          Monthly Rent or, if this Lease has terminated and Tenant is not in
          monetary or financial default, refund the overpayment to Tenant within
          thirty (30) days of determination.

     (d)  The calculation and payment of Capital Expense Rent is separate,
          distinct, and shall not be affected by the calculation and payment of
          either Basic Monthly Rent, Tax Rent, or Operating Expense Rent. Any
          item of cost or expense included as Capital Expenses shall not be
          included as either Property Taxes or Operating Expenses.

7.   Use

                                      11      Real Estate/Newport Beach Lease(3)

<PAGE>

     (a)  Tenant agrees that the Permitted Use is a material provision of this
          Lease. Tenant may use the Premises solely for the Permitted Use and
          shall not use or permit the Premises to be used for any other purpose
          without the prior written consent of Landlord. Any consent by Landlord
          to a change of use by Tenant shall not be deemed a waiver of
          Landlord's right to withhold its consent to any subsequent proposed
          change of use.

     (b)  Tenant shall, at Tenant's sole cost and expense, comply with all
          certificates, rules, directives, orders, and regulations of any public
          authority (including Federal, State, County, and Municipal
          authorities) which concern Tenant's specific use or occupancy of the
          Premises. Tenant shall discontinue any violating use upon Landlord's
          demand. If Tenant does not discontinue such violation, such violation
          shall constitute a default under this Lease (after the expiration of
          the applicable cure period). Notwithstanding the foregoing, the Tenant
          shall not be responsible for making any capital improvements to the
          Building or the Premises as a result of such laws except to the extent
          required by Section 6 or to the extent that capital improvements to
          the Premises are required due to Tenant's particular use or occupancy
          of the Premises.

     (c)  Tenant shall not do or permit anything to be done which will
          invalidate or materially increase the cost of any insurance policy
          covering the Land, Building, Common Areas, or equipment, property, and
          facilities therein (provided Tenant has received written notice of
          such insurance policy requirements). Tenant shall comply with all
          rules, orders, regulations, and requirements of any insurance fire
          rating bureau or any other organization performing a similar function.
          Tenant shall, upon Landlord's demand, reimburse Landlord for any
          additional insurance premiums which may be incurred due to Tenant's
          failure to comply with this Lease.

     (d)  Tenant shall not do or permit anything to be done which will
          constitute a nuisance, or obstruct, injure, or interfere with the
          rights of other tenants or occupants of the Building. The Premises
          shall not be used for any lodging, sleeping, or unlawful purpose.

     (e)  Tenant shall not mortgage, hypothecate, pledge or encumber this Lease
          in whole or in part.

     (f)  Tenant shall not permit any signs, lettering or advertising matter to
          be erected or attached to the Premises (except as provided in Exhibit
          F attached hereto).

     (g)  Tenant shall not encumber or obstruct the Common Areas surrounding the
          Premises nor cause the same to be encumbered or obstructed, nor
          encumber or obstruct any access ways to the Premises, nor cause same
          to be encumbered or obstructed, except that same may be temporarily
          obstructed on move-in and move-out, provided that the same is
          coordinated with the Building Manager.

     (h)  Landlord agrees to comply with and to cause the Building and the
          Building's common areas to be in compliance at all times with all
          laws, including, without limitation, the Americans with Disabilities
          Act, and all regulations or amendments promulgated thereunder, in
          connection with Landlord's responsibility for repair and maintenance
          of the Building, the operation, repair, maintenance, and accessibility
          of the Building, and as applicable to Landlord's obligations under any
          other relevant provisions of this Lease.

8.   Utilities and Services

     (a)  Landlord shall provide Tenant with the following services twenty-four
          (24) hours a day, every day of the year:

          (i)  Access to the Building, Common Areas (including the parking
               facility) and Premises;

                                      12      Real Estate/Newport Beach Lease(3)

<PAGE>

          (ii)  Reasonable quantities of electric current receptacles;

          (iii) Water for lavatory and drinking purposes;

          (iv)  Automated elevator service (a minimum of one elevator will be
                available).

          (v)   Security services generally provided at comparable first-class
                office buildings in the Newport Beach/John Wayne Airport area;

          (vi)  Electrical energy to meet Tenant's ordinary business needs for
                all purposes, which shall be an average connected load of up to
                4 watts of electric consumption per square foot of rentable
                area; and

          (vii) Chilled water to Tenant's 24 hour air conditioning equipment in
                Tenant's datacomm room.

     (b)  Landlord shall provide Tenant with the following services during
          Business Hours:

          (i)   Heat, ventilation, or air conditioning as may be required for
                the comfortable use and occupation of the Premises as generally
                furnished at comparable first-class office buildings in the
                Newport Beach/John Wayne Airport area;

          (ii)  Standard fluorescent lighting; and

          (iii) Janitorial and lobby attendant services to the extent and during
                such times (but not less than five (5) days per week, excluding
                holidays) as are determined by Landlord, but in no event at a
                level of service less than those janitorial and lobby attendant
                services.

     (c)  Notwithstanding the provisions of Section 8.(a.), Landlord may:
          restrict access to the Premises while making any repairs, alterations,
          or improvements to the Premises (to the extent such repairs,
          alterations or improvements are permitted or required to be made by
          Landlord under this Lease), Common Areas, or Building; make reasonable
          nondiscriminatory changes to the access, utilities, and services
          Landlord is obligated to provide hereunder; make such changes in the
          access, utilities, and services Landlord is obligated to provide
          hereunder as may be reasonable and necessary to comply with any
          government restriction, requirement, or standard relating thereto; or
          prevent access, or curtail utilities or services to the Land,
          Building, Common Areas, or Premises during any invasion, mob action,
          riot, public excitement, or other circumstances rendering such action
          advisable, in Landlord's reasonable opinion. Any such actions taken by
          Landlord under this Section 8.(c), are conditioned upon (i) Landlord
          providing Tenant with reasonable advance notice, and (ii) Landlord
          using best efforts to not interfere with Tenant's use or occupancy of
          the Premises and access thereto.

     (d)  If Tenant either:

          (i)   Requires or uses more utilities or services than Landlord has
                agreed to furnish as described above;

          (ii)  Requires utilities or services that are not generally provided
                to the Building during non-Operating Hours; or

          (iii) Has special water, electric, cooling, or ventilation needs due
                to concentration of personnel, or the use of office equipment,
                devices, or machines which consume power or generate heat in
                excess of a personal computer or electric office typewriter
                (which may include, without limitation, communications
                equipment, main-frame or mini-

                                       13     Real Estate/Newport Beach Lease(3)

<PAGE>
               computers, or photocopiers);

          then Landlord shall make available such utilities or services and
          Tenant shall pay, as Additional Rent, the charge for such use, as
          reasonably determined by Landlord. Landlord may further require
          Tenant, at Tenant's sole cost and expense, to install separate
          circuitry or meters to accommodate and/or measure Tenant's demand if
          Landlord substantiates such excessive usage of electrical power
          exceeding 4 watts per rentable square feet over a random 7 continuous
          calendar days (non-holiday). Such tests would be conducted by a
          qualified professional electrical engineer or, by an engineering
          testing service with such results validated by a qualified
          professional electrical engineer. Such tests would be the Landlord's
          sole cost if such results do not demonstrate excessive electrical
          usage as defined above or, at Tenant's sole cost if Tenant challenges
          Landlord's right to conduct such survey and such results do
          demonstrate excessive electrical usage as defined above.

          Without limiting anything to the contrary contained herein, Landlord
          shall also provide the following services:

          (iv) Window washing of the inside and outside windows in the
               Building's perimeter walls at intervals to be determined by
               Landlord, but not less than four (4) times per year; and

          (v)  Freight elevator services at all times for normal office
               deliveries subject to scheduling by Landlord (but no advance
               scheduling shall be required for scheduling such service during
               Operating Hours). Tenant shall be billed for all freight elevator
               maintenance services at Landlord's actual cost. Freight elevators
               and loading docks shall be manned, open and accessible at all
               times. For purposes of this Section 8.(d)(v), the freight
               elevators do not include the service elevator connecting the
               First and Third floors of the Premises used exclusively by
               Tenant.

     (e)  Landlord reserves the right, without liability to Tenant and without
          constituting any claim of constructive eviction, to stop or interrupt
          any heating, lighting, ventilating, air conditioning, gas, steam,
          power, electricity, water or other service and to stop or interrupt
          the use of any Building facilities at such times to the extent
          necessary and for as long as may reasonably be required by reason of
          accidents, strikes, or the making of repairs, alterations or
          improvements or inability to secure a proper supply of fuel, gas,
          steam, water, electricity, labor or supplies, or by reason of another
          cause beyond the reasonable control of Landlord. Landlord agrees that
          all necessary repairs shall be made as expeditiously as possible and
          that Landlord shall use all reasonable efforts to schedule same so as
          to minimize any interruption of service or use, as the case may be, to
          Tenant. However, if such events, as described above, occur (regardless
          if such events were in Landlord's control), such stoppage or
          interruption, shall entitle Tenant to an abatement of Rent or other
          compensation, but limited only to the affected area(s) of the Premises
          where such stoppage or interruption prohibits Tenant from occupying
          those rentable square foot portions of the Premises, over the time
          such areas remain affected. In addition, if such stoppage or
          interruption continues for a period of forty-five (45) consecutive
          days or for more than sixty (60) days in the aggregate in any twelve
          (12) month period, then Tenant shall have the right to terminate this
          Lease by giving written notice thereof to Landlord; such termination
          to be effective as of the date set forth in said notice.

     (f)  Landlord will, at the request of Tenant, maintain a listing on the
          directory located in the Building lobby of the name of Tenant.
          Landlord shall not be required to list the names of any individuals on
          said Building directory.

     (g)   In the event Tenant is not satisfied with Landlord's janitorial
           services, Tenant shall have the right to (i) cancel such service as
           to the Premises, and (ii) retain, at Tenant's sole cost and expense,
           a janitorial service company to perform janitorial services to the
           Premises. In such

                                       14     Real Estate/Newport Beach Lease(3)

<PAGE>

               event, the pro-rated costs of janitor service shall not be
               included in the determination of Operating Expenses.

9.   Parking

     (a)  Tenant shall have a revocable license to park, in common with other
          tenants, up to Tenant's Parking Allotment of automobiles in the
          parking facility of the Building, as stated in paragraph 14 of the
          Lease Preamble, subject to Exhibit E and the following:

          (i)   Tenant shall pay Landlord the parking rates as stated in
                paragraph 14 of the Lease Preamble at such time and in such
                manner as Landlord may, from time to time, establish for tenants
                of the Building;

          (ii)  Tenant shall not be in default of this Lease (after the
                expiration of all notice and cure periods);

          (iii) Tenant shall abide by any reasonable rules and regulations for
                use of the parking facilities that Landlord establishes from
                time to time, and shall use the parking facility in a safe and
                lawful manner;

          (iv)  Tenant and Tenant's employees, contractors, and invitees may be
                required to use attended or tandem parking;

          (v)   No bailment shall be created hereunder or by any use of the
                parking facility; and

          (vi)  Tenant hereby releases Landlord and Landlord's agents, servants,
                employees, and independent contractors from all claims for loss
                or damage (including, without limitation, vandalism, and theft)
                arising out of or related to use of the parking facility (except
                to the extent caused by the negligence or willful misconduct of
                Landlord or Landlord's agents, servants, employees or
                independent contractors).

          If Tenant violates any of these terms and Tenant fails to correct such
          violations within ten (10) days after receipt of written notice,
          Landlord may revoke the license to the extent that Landlord deems
          reasonable and necessary, without liability to Tenant. Tenant's
          license shall terminate concurrently with the termination of this
          Lease.

10.  Repairs

     (a)  Except as provided in Section 10.(b), Tenant shall, at Tenant's sole
          cost and expense, keep the Premises in good condition and repair. In
          particular, above Building standard improvements which are fully
          contained in the Premises or exist outside the Premises, but were
          installed or are maintained to exclusively serve the Premises
          (including, without limitation: the service elevator dedicated to
          Tenant and the Demised Premises which connects the lower level parking
          area, the first and fourth floors, interior glass panels and
          partitions; executive lavatories, showers, toilets and basins; kitchen
          facilities; package unit heating, ventilation and air conditioning
          systems; and each of the foregoing improvements' respective
          mechanical, plumbing and electrical connections to the base Building
          systems). Tenant shall use Landlord or Landlord's approved
          subcontractors for all work related to the mechanical, plumbing,
          heating, ventilation, air conditioning, electrical, lighting, energy
          management, and fire/life safety systems; and, such work may be
          performed in an emergency (defined in Section 12.(b)) without prior
          demand upon Tenant with the contractor's charge for same payable by
          Tenant to Landlord as Additional Rent. Notwithstanding the foregoing,
          Tenant shall not be responsible for making capital expenditures in
          connection with such repairs unless (i) required by Section 6, (ii)
          such repairs relate to

                                       15     Real Estate/Newport Beach Lease(3)

<PAGE>

          improvements installed by or on behalf of Tenant, or (iii) are
          necessitated by Tenant's acts or omissions.

     (b)  Landlord shall, at Landlord's cost and expense (except to the extent
          such costs constitute Operating Expenses or Capital Expenses), repair
          and maintain the Common Areas, structural portions and the roof of the
          Building (including the parking garage), and all basic mechanical,
          electrical, plumbing, heating, ventilation, and air conditioning
          systems providing service to all tenants in the Building. Payment of
          such expenses by Tenant to Landlord shall be subject to Sections 5 and
          6 of this Lease. Notwithstanding the foregoing, if any such
          maintenance or repair is caused in part or in whole by the negligence
          or willful misconduct of Tenant, its agents, servants, employees,
          licensees, or invitees, then Tenant shall pay to Landlord as
          Additional Rent all charges for such maintenance and repairs. Tenant
          shall take all necessary action to prevent any additional or future
          damage which Landlord believes may be caused by Tenant, its agents,
          servants, employees, licensees, or invitees (whether as an isolated
          incident or as a continuous course of conduct, or whether individually
          or as a group), and Tenant's failure to take such action shall be a
          material breach of this Lease (after the expiration of applicable
          notice and cure periods).

     (c)  Provided Landlord uses reasonable efforts to minimize interference
          with Tenant's use of the Premises, Landlord reserves the right to:

          (i)   Install, repair, maintain, relocate, or replace plumbing,
                electrical, HVAC, and other mechanical systems above the
                ceiling, below the floor, within the walls and central core;

          (ii)  Temporarily close the Common Areas or Building for maintenance,
                repair, improvement, or alteration of the Building or Common
                Areas, or make changes to the Common Areas, including, without
                limitation, changes affecting ingress, egress, traffic flow,
                landscaping, and parking facilities; and

          (iii) Perform such other acts or make such other changes to the
                Building and Common Areas that Landlord may deem appropriate.

     (d)  Landlord shall not be liable to Tenant for any failure by Landlord to
          perform the repairs and maintenance required of Landlord hereunder,
          unless such failure persists for an unreasonable time after the
          earlier of (i) Tenant notifies Landlord in writing of the specific
          need for such repairs or maintenance or (ii) Landlord otherwise
          becomes aware of such repair or maintenance. There shall be no
          abatement of Rent and no liability of Landlord by reason of any injury
          to, or interference with, Tenant's business arising from the making of
          any repairs, alterations, or improvements in or to any portion of the
          Building, Common Areas, or Premises. Tenant waives any right to make
          repairs at Landlord's expense pursuant to California Civil Code
          section 1942 or any similar law, statute, or ordinance.
          Notwithstanding anything to the contrary contained in this Lease, in
          the event Landlord fails to make such repairs (regardless if such
          failure is beyond the reasonable control of Landlord) and such failure
          renders the Premises or any material portion thereof untenantable or
          unsuitable for the conduct of Tenant's business for a period of more
          than three (3) consecutive business days, then all monetary
          obligations under this Lease shall abate from and after such three (3)
          day period until the Premises is again rendered tenantable and
          suitable for the conduct of Tenant's business therefrom. In addition,
          in the event Landlord fails to make such repairs and such failure
          renders the Premises or any material portion thereof untenantable or
          unsuitable for the conduct of Tenant's business for a period of
          forty-five (45) consecutive days or more, or for more than forty-five
          (45) days in the aggregate in any twelve (12) month period, then
          Tenant shall have the right to terminate this Lease by giving written
          notice thereof to Landlord at any time until the Premises is again
          rendered tenantable and suitable for the conduct of Tenant's business
          therein; such termination to be effective as of

                                       16     Real Estate/Newport Beach Lease(3)

<PAGE>

          the date set forth in said notice.

11.  Condition of Premises

     (a)  Tenant accepts the Premises as being in good order, condition, and
          repair. Except as may be expressly set forth in this Lease, Tenant
          acknowledges that neither Landlord, nor any employee, agent, or
          contractor of Landlord has made any representation or warranty
          concerning the Land, Building, Common Areas, or Premises, or the
          suitability of same for the conduct of Tenant's business.

     (b)  Upon the expiration of the Term or earlier termination of this Lease,
          Tenant shall relinquish possession of the Premises to Landlord in the
          same condition as received, ordinary wear and tear and damage by fire
          or other casualty (as described in Section 16) excepted, free of all
          trash and rubbish, and in broom clean condition. Tenant shall have no
          obligation to remove any leasehold improvements made to the Premises
          by or on behalf of Tenant. If Tenant fails to remove its personal
          property upon expiration of the Term and Landlord has provided Tenant
          with notice and ten (10) business days to cure such failure, Landlord
          may dispose of any personal property remaining in the Premises in
          accordance with California Civil Code section 1980, et seq., and shall
          be entitled to recover all reasonable costs and expenses incurred in
          such disposal, including Landlord's reasonable attorneys' fees and
          costs.

12.  Inspection and Entry by Landlord

     (a)  Tenant agrees to permit Landlord and Landlord's agents, employees or
          other representatives, upon reasonable telephonic notice and without
          unreasonable interference with the normal conduct of Tenant's
          business, (i) to show the Premises to any lessor under any underlying
          lease or ground lease or any mortgagee or any persons wishing to
          purchase the same, and (ii) Tenant agrees that on and after the ninth
          month next preceding the expiration of the Term hereof, Landlord or
          Landlord's agents, employees or other representatives shall have the
          right to show the Premises to prospective tenants and to post exterior
          ground level signs indicating the availability of the Premises for
          lease.

     (b)  Tenant agrees that Landlord and Landlord's agents, employees or other
          representatives, shall have the right to enter into and upon the
          Premises or any part thereof, at all reasonable hours upon reasonable
          telephonic notice and without unreasonable interference to the normal
          course of Tenant's business (except in the event of an emergency, in
          which event Landlord, its agents, employees or other representatives
          may enter regardless of the hour and without notice), for the purpose
          of examining the same or reading meters, or performing maintenance or
          making such repairs or alterations therein as may be necessary for the
          safety and preservation thereof. This clause shall not be deemed to be
          a covenant by Landlord nor be construed to create an obligation on the
          part of Landlord to make such inspection or repairs.

     (c)  Landlord shall at all times have a key with which to unlock all of the
          doors in and to the Premises, excepting Tenant's vaults and safes. If
          Tenant changes locks on any doors without Landlord's prior written
          consent, Landlord shall have the right, after providing Tenant with
          written notice and twenty-four (24) hours to provide Landlord with
          keys to such doors, to enter the Premises, remove, change, and/or
          replace such locks, repair any damage, and restore the Premises, and
          charge Tenant all expenses incurred in accomplishing the foregoing as
          Additional Rent.

     (d)  There shall be no abatement of Rent and no liability of Landlord by
          reason of any injury to, or interference with Tenant's business
          arising from any entry performed by Landlord in a good

                                       17     Real Estate/Newport Beach Lease(3)

<PAGE>

          faith attempt to comply with the terms of this Section. Any such good
          faith entry shall not constitute an eviction, or a forcible or
          unlawful entry, or detainer of the Premises.

13.  Alterations

     (a)  All alterations, installations, decorations, or additions or other
          improvements ("Alterations"), which shall be made by, or on behalf of
          Tenant in, or to the Premises shall require Landlord's prior written
          consent, which shall not be unreasonably withheld. Notwithstanding the
          foregoing, Tenant may make Alterations without Landlord's consent so
          long as such Alterations are consistent with the quality, integrity
          and/or character of the Building and do not cost Tenant more than
          $50,000.00. In any case, Tenant shall give Landlord prior written
          notice of not less than ten (10) business days of any proposed
          Alterations with copies of proposed plans. All such Alterations shall
          be done at Tenant's sole expense and must be administered by Tenant's
          construction manager or, if requested by Tenant, the Building's
          designated project manager at a not-to-exceed 2.5% of total project
          costs (including design, permits, and fees). Landlord's consent shall
          not affect Tenant's liability therefor and Tenant agrees to indemnify,
          defend and hold harmless Landlord from any and all costs, expenses,
          claims, causes of action, damages, and liabilities of any type or
          nature whatsoever (including but not limited to attorneys' fees and
          costs of litigation) arising out of or relating to the making of
          Alterations by Tenant.

          Landlord may impose any reasonable condition upon issuing Landlord's
          consent (including, without limitation; obtaining the consent of any
          mortgagee, encumbrancer, lender, or ground lessee; providing Landlord
          with working drawings, specifications, and estimated costs; providing
          Landlord with verification of all required permits or approvals; and,
          obtaining a waiver of lien.)

     (b)  Tenant shall use Landlord's designated contractors for all Alterations
          affecting basic Building mechanical, electrical, plumbing, heating,
          ventilation, and air conditioning systems (provided such contractors
          offer competitive rates for such work); and, shall otherwise use
          licensed, qualified contractors and subcontractors which shall carry
          course of construction, products liability, completed operations,
          worker's compensation, and public liability insurance in amounts
          satisfactory to Landlord, naming Landlord as an additional insured.
          Alterations shall be performed at the times and in the manner
          reasonably specified by Landlord, and shall not interfere with access
          or use of the Common Areas or other premises. Tenant shall supply
          as-built drawings to Landlord upon completion of the Alterations.

     (c)  All permanent improvements to the Premises and Leasehold Improvements
          (including, without limitation, floor and wall coverings, blinds,
          drapes, built-in millwork, shelving, doors, locks, paneling and the
          like, shall become the property of Landlord upon the termination of
          this Lease and shall be relinquished with the Premises.

     (d)  The terms of Exhibit D shall apply to alterations to the Premises
          controlled by Tenant.

14.  Liens

     Tenant shall keep the Land, Building, and Premises free from any liens
     resulting from work performed, materials furnished, or obligations incurred
     by, or on behalf of, Tenant. Tenant shall promptly discharge any such lien
     by bond or otherwise. If Tenant fails to discharge or bond over any such
     lien within thirty (30) days after Landlord's written demand, then Landlord
     may discharge the lien (provided that such discharge shall not interfere
     with Tenant's relationship with the lienholder/contractor) and charge
     Tenant as Additional Rent all costs and expenses reasonably incurred by
     Landlord to do so, including attorneys' fees and costs.

                                       18     Real Estate/Newport Beach Lease(3)

<PAGE>

15.  Covenants of Tenant

     Tenant covenants and agrees that Tenant will:

     (a)  Faithfully observe and comply with the Rules and Regulations annexed
          hereto and made a part hereof as Exhibit A and such additional
          reasonable rules and regulations as Landlord hereafter at any time or
          from time to time may communicate in writing to Tenant, and which, in
          the reasonable judgment of Landlord, shall be necessary or desirable
          for the reputation, safety, care or appearance of the Building, or the
          preservation of good order therein, or the operation or maintenance of
          the Building, or the equipment thereof, or the comfort of tenants or
          others in the Building; provided, however, that in the case of any
          conflict between the provisions of this Lease and any such rule or
          regulation, the provisions of this Lease shall control. Nothing
          contained in this Lease shall be construed to impose upon Landlord any
          duty or obligation to enforce the Rules and Regulations or the terms,
          covenants or conditions in any other lease as against any other
          tenant, and Landlord shall not be liable to Tenant for violation of
          any rule or regulation by any other tenant, its employees, agents,
          visitors, invitees, subtenants or licensees. Notwithstanding the
          above, Landlord agrees to use its best efforts to enforce the Rules
          and Regulations against any other tenant who Tenant notifies Landlord
          is violating same, which notification shall be in writing and shall
          specify the nature of the rule or regulation violation that is
          occurring.

     (b)  Tenant, at Tenant's expense, shall promptly comply with all laws,
          rules, regulations and ordinances, of all governmental authorities or
          agencies having jurisdiction over the Premises, and of all insurance
          bodies (including, without limitation, the Board of Fire
          Underwriters), at any time duly issued or in force, applicable to
          Tenant's specific use of the Premises.

16.  Damage to Building

     (a)  In the event that the Building or any of the equipment affixed thereto
          or stored therein should be damaged as a result of any act of Tenant,
          its agents, servants, employees, invitees or contractors, Tenant
          shall, within thirty (30) days after written demand, pay to Landlord
          the cost of all required repairs, including structural repairs.

     (b)  If all or any part of the Premises is damaged by fire or other
          casualty, Tenant shall promptly notify Landlord in writing. During any
          period of time that all or a material portion of the Premises is
          rendered untenantable as a result of a fire or other casualty, the
          Rent shall abate for the portion of the Premises that is untenantable
          and not used by Tenant. Landlord shall have the right to terminate
          this Lease if: (i) the Building shall be damaged so that, in
          Landlord's reasonable judgment, substantial alteration or
          reconstruction of the Building shall be required (whether or not the
          Premises has been damaged) and such alteration or reconstruction is
          not reasonably possible to complete within one year after such damage
          or destruction (as determined in accordance with Section 16(c)); (ii)
          Landlord is not permitted by law to rebuild the Building in
          substantially the same form as existed before the fire or casualty; or
          (iii) the Premises have been materially damaged and there is less than
          one (1) year of the Term remaining on the date of the casualty and
          such damage is not reasonably possible to be repaired within ninety
          (90) days after such damage or destruction (as determined in
          accordance with Section 16(c)); provided, however, if Tenant has
          exercised an Option to Extend before such damage, the Term shall be
          deemed to be extended pursuant to the Option to Extend and Landlord
          will not have the right to terminate the Lease. Landlord may exercise
          its right to terminate this Lease by notifying Tenant in writing
          within sixty (60) days after the date Landlord delivers to Tenant the
          Completion Estimate (as hereinafter defined). In addition to
          Landlord's rights to terminate as provided herein, Tenant shall have
          the right to terminate this Lease if: (iv) a substantial portion of
          the Premises has been damaged by fire or other casualty and such
          damage cannot reasonably be repaired within sixty (60) days after the
          date of such fire

                                       19     Real Estate/Newport Beach Lease(3)

<PAGE>

          or other casualty; (v) there is less than one (1) year of the Lease
          Term remaining on the date of such casualty; (vi) the casualty was not
          caused by the negligence or willful misconduct of Tenant or its
          agents, employees or contractors; and (vii) Tenant provides Landlord
          with written notice of its intent to terminate within thirty (30) days
          after the date of the fire or other casualty. If neither Landlord nor
          Tenant elect to terminate this Lease, Landlord shall promptly commence
          and proceed with reasonable diligence to repair and restore the
          Building. However, in no event shall Landlord be required to spend
          more than the insurance proceeds received by Landlord or those that
          would have been received had Landlord carried the insurance required
          to be carried hereunder. Landlord and Tenant hereby waive the
          provisions of any law relating to the matters addressed in this
          Section, and agree that their respective rights for damage to or
          destruction of the Premises shall be those specifically provided in
          this Lease.

     (c)  If all or any portion of the Premises shall be made untenantable for
          Tenant's business purposes by fire or other casualty, Landlord shall,
          with reasonable promptness but in no event later than the 30th day
          after the fire or casualty occurred, cause an architect or general
          contractor selected by Landlord to provide Landlord and Tenant with a
          written estimate of the amount of time required to substantially
          complete the repair and restoration of the Premises and make the
          Premises tenantable again, using standard working methods ("Completion
          Estimate"). If the Completion Estimate indicates that the Premises
          cannot be made tenantable within one (1) year from the date the repair
          and restoration is started, then regardless of anything in this
          Section to the contrary, either party shall have the right to
          terminate this Lease by giving written notice to the other of such
          election within thirty (30) days after receipt of the Completion
          Estimate.

     (d)  In addition, if the Premises and the Building are not repaired and
          restored as required herein within thirty (30) days after the date
          Landlord estimated in the Completion Notice, Tenant shall have the
          right to terminate this Lease by giving Landlord written notice
          thereof at any time thereafter so long as such notice is delivered by
          Tenant prior to completion of such repairs and restoration by
          Landlord.

     (e)  For purposes of this Section, any fire or casualty which prevents
          reasonable access and adequate elevator service to the Premises or the
          lobby of the Building shall be deemed to have caused the Premises to
          become untenantable. In addition, Tenant shall be permitted a
          reasonable amount of time after delivery of the Premises to Tenant to
          repair damage to Tenant's improvements, furniture, chattels and trade
          fixtures before Tenant is obligated to pay the full amount of Base
          Rent and Additional Rent.

17.  Insurance

     (a)  Landlord agrees that throughout the Term Landlord shall insure the
          Building against fire and other risks of casualty commonly insured
          against in an amount at least as great as that amount that Landlord
          reasonably believes to be the full replacement value of the Building,
          less foundations and footings.

     (b)  Tenant shall, at Tenant's sole cost and expense, but, except to the
          extent prohibited by law with respect to worker's compensation
          insurance, for the mutual benefit of Landlord and Tenant and any
          Additional Insured (as hereinafter defined) or any other additional
          insured as Landlord may from time to time reasonably determine,
          maintain or cause to be maintained (i) comprehensive general liability
          insurance, including but not limited to, Premises, bodily injury,
          personal injury, and contractual liability, coverages for any and all
          or injury resulting from any act or omission on the part of Tenant or
          Tenant's contractor's, licensees, agents, visitors or employees, on or
          about the Premises including such claims arising out of the
          construction of improvements on the Premises, such insurance to afford
          protection to the limit of not less than Three Million Dollars
          ($3,000,000.00) in respect to injury or death to any one person or to
          any number of persons or property damage arising out of a single
          occurrence; (ii) worker's

                                       20     Real Estate/Newport Beach Lease(3)

<PAGE>

          compensation insurance covering all persons employed in connection
          with the construction of any improvements by Tenant and the operation
          of its business upon the Premises and (iii) "all risk" coverage on all
          of Tenant's personal property, including, but not limited to, standard
          fire and extended coverage insurance with vandalism and malicious
          mischief endorsements on all Tenants improvements and alterations in
          or about the Premises, to the extent of their full replacement value.
          All such insurance shall, to the extent permitted by law, name
          Landlord, its employees, agents, other representatives, successors and
          assigns as additional insureds (other than Landlord, the "Additional
          Insureds") and shall be written by a good and solvent insurance
          carrier authorized to do business in the State of California.

     (c)  Prior to the Commencement Date, and at least thirty (30) days prior to
          the expiration date of any policy, Tenant shall furnish evidence of
          such insurance to Landlord. Such insurance shall be in form reasonably
          satisfactory to Landlord and without limitation, shall provide that no
          cancellation or lapse thereof or change therein shall be effective
          until after thirty (30) days' written notice to Landlord at the
          address specified in Section 23 of this Lease. Tenant waives all
          rights of recovery against Landlord and the Additional Insureds for
          any loss, damages, or injury of any nature whatsoever to property or
          persons for which the Tenant is insured, except that Tenant does not
          waive any rights it may have to recover against any party for any
          loss, damages or injury to persons to the extent caused by the
          negligence or willful misconduct of such party.

     (d)  During the Term of this Lease, Landlord and Tenant shall maintain in
          effect in each insurance policy required under this Lease that relates
          to property damage a waiver of subrogation to the extent reasonably
          obtainable at normal premium rates in favor of Landlord and the
          Additional Insureds from its then current insurance carriers, and
          shall at all times furnish evidence of such currently effective waiver
          to each other. Such waiver shall be in a form reasonably satisfactory
          to the other party and without limitation, shall provide that no
          cancellation or lapse thereof or change therein shall be effective
          until after thirty (30) days' written notice to such other party at
          the address specified in Section 23 of this Lease.

     (e)  Each insurance policy required to be maintained under this Lease shall
          state that:

          (i)   with respect to the interest of Landlord and the Additional
                Insureds the insurance maintained pursuant to each such policy
                shall not be invalidated by any action or inaction of Tenant and
                shall insure Landlord and the Additional Insureds regardless of
                any breach or violation of any warranties, declarations,
                conditions or exclusions by Tenant.

          (ii)  all provisions of each such insurance policy, except for the
                limits of liability, shall operate in the same manner as if a
                separate policy had been issued to each person or entity insured
                thereunder.

          (iii) the insurance provided thereunder is primary insurance without
                any right of contribution from any other insurance which may be
                carried by or for the benefit of Landlord and the Additional
                Insureds.

          (iv)  it recognizes the indemnification set forth in Section 19 of
                this Lease.

     (f)   Failure of Tenant to maintain any of the insurance required under
           this Lease or to cause to be provided in any insurance policy the
           requirements set forth in this Section 17, shall constitute a default
           under this Lease after the expiration of applicable notice and cure
           periods.

18.  Non-Liability of Landlord

     (a)  Landlord shall not be liable for (and Tenant shall make no claim for)
          any property damage

                                       21     Real Estate/Newport Beach Lease(3)

<PAGE>

          which may be sustained by Tenant or any other person, as a consequence
          of the failure, breakage, leakage, inadequacy, defect or obstruction
          of the water, plumbing, steam, sewer, waste or soil pipes, roof,
          drains, leaders, gutters, valleys, downspouts, or the like or of the
          electrical, gas, power, conveyor, refrigeration, sprinkler, air
          conditioning or heating systems, elevators or hoisting equipment; or
          by reason of the elements; or resulting from the carelessness,
          negligence or improper conduct on the part of any other tenant of
          Landlord or Landlord's agents, employees, guests, licensees, invitees,
          assignees or successors (except resulting from Landlord's negligence
          or willful misconduct); or attributable to any interference with,
          interruption of or failure, except resulting from Landlord's
          negligence or willful misconduct, of any services or utilities to be
          furnished or supplied by Landlord. Tenant shall give Landlord prompt
          written notice of the occurrence of any events set forth in this
          Section 18.

     (b)  Each party hereby releases the other party with respect to any claim
          (including a claim for negligence) which it might otherwise have
          against the other party for loss, damage or destruction with respect
          to its property occurring during the term of this Lease to the extent
          to which it is insured under a policy or policies carried or required
          to be carried by Landlord or Tenant hereunder containing an
          enforceable waiver of subrogation or permission to release liability.

19.  Indemnification

     Tenant shall indemnify and hold harmless Landlord from and against any
     expense (including, without limitation, reasonable legal and collection
     fees), loss, liability (excluding consequential, damages suffered or
     incurred as a result of or in connection with (i) any breach by Tenant of
     its obligations contained in this Lease or (ii) its acts or the acts of its
     agents, servants, invitees, contractors or employees. Landlord shall
     indemnify and hold harmless Tenant from and against any expense (including,
     without limitation, reasonable legal and collection fees), loss, liability
     (excluding consequential) damages suffered or incurred as a result of or in
     connection with (i) any breach by Landlord of its obligations contained in
     this Lease or (ii) its acts of its agents, servants, invitees, contractors
     or employees.

20.  Tenant Default

     Tenant shall be in default hereunder if:

     (a)  Tenant shall default in the payment of (i) any Total Monthly Rent or
          (ii) any Additional Rent or other charge payable monthly hereunder by
          Tenant to Landlord, on any date upon which the same becomes due, and
          such default shall continue for ten (10) days after written notice of
          the same is delivered to Tenant;

     (b)  Tenant shall default in the payment of any Additional Rent or any
          other charge payable hereunder which are not due and payable hereunder
          on a monthly basis, on any date upon which the same becomes due, and
          such default shall continue for thirty (30) days after Landlord shall
          have given to Tenant a written notice specifying such default;

     (c)  Tenant shall default in the due keeping, observing or performing of
          any covenant, agreement, term, provision or condition of this Lease on
          the part of Tenant to be kept, observed or performed (other than a
          default of the character referred to in clauses (a), or (b) of this
          Section 20, and if such default shall continue and shall not be
          remedied by Tenant within thirty (30) days after Landlord shall have
          given to Tenant a written notice specifying the same, unless such
          default cannot reasonably be cured within thirty (30) days and, within
          such thirty (30) day period Tenant shall have commenced to cure such
          failure and shall have provided Landlord with a written notice
          undertaking to continue to diligently prosecute such cure to
          completion and does in fact diligently complete such cure, in which
          case the cure period provided herein

                                       22     Real Estate/Newport Beach Lease(3)

<PAGE>

          shall be extended so long as Tenant is in full compliance with the
          provisions of this Section 20.(c) relating to the extension of such
          time period; or

     (d)  Tenant shall be adjudicated a bankrupt, insolvent or placed in
          receivership, or should proceedings be instituted by or against Tenant
          for bankruptcy, insolvency, receivership, agreement of composition or
          assignment for the benefit of creditors, or if this Lease or the
          estate of Tenant hereunder shall pass to another by virtue of any
          court proceedings, writ of execution, levy, sale, or by operation of
          law.

21.  Remedies

     (a)  If Tenant is in default of this Lease (after the expiration of
          applicable notice and cure periods), then Landlord may avail itself of
          any remedies under law, Landlord's election of any particular remedy
          to be at Landlord's sole discretion. Landlord may elect to avail
          itself of the remedy described in California Civil Code section
          1951.4, in which case this Lease shall continue in full force and
          effect after Tenant's breach or abandonment, and notwithstanding
          anything to the contrary contained in Section 29, Tenant shall
          thereafter have the right to sublet or assign this Lease subject only
          to reasonable limitations. If Landlord does not elect to avail itself
          of the remedy described in California Civil Code section 1951.4 and
          Tenant either breaches this Lease and abandons the Premises before the
          end of the Term, or Tenant's right to possession is terminated by the
          Landlord because of a breach of this Lease, then this Lease shall
          terminate, and Landlord shall recover from Tenant the following:

          (i)   The worth at the time of award of the unpaid Rent which had been
                earned at time of termination;

          (ii)  The worth at the time of award of the amount by which the unpaid
                Rent which would have been earned after termination until the
                time of award exceeds the amount of such rental loss that Tenant
                proves could have been reasonably avoided;

          (iii) The worth at the time of award of the amount by which the unpaid
                Rent for the balance of the Term after the time of award exceeds
                the amount of such rental loss that Tenant proves could be
                reasonably avoided; and

          (iv)  Any other amount necessary to compensate Landlord for all the
                detriment proximately caused by Tenant's failure to perform
                Tenant's obligations under the Lease, or which in the ordinary
                course of things would be likely to result therefrom (including
                without limitation, and costs of obtaining mitigating rental
                income, such as excused rent, brokerage commissions, Tenant
                improvements, parking concessions, lease takeovers, cash
                payments, advertising, moving costs or any other cost or Tenant
                concessions related to the re-leasing of the Premises upon
                default of Tenant).

          The "worth at the time of award" of the amounts referred to in
          subparagraphs (a)(i) and (a)(ii) above, shall be computed by allowing
          interest at the rate specified in Section 36 of this Lease; and the
          "worth at the time of award" of the amounts referred to in
          subparagraph (a)(iii) above, shall be computed by discounting such
          amount at the discount rate of the Federal Reserve Bank of San
          Francisco at the time of award, plus two percent (2%).

     (b)  Tenant waives any equity of redemption and any right to relief from
          forfeiture as provided by California Code of Civil Procedure section
          1179 (or any other similar applicable statute, regulation or law now
          or hereinafter in effect).

     (c)  In addition to any and all other remedies Tenant may have at law or in
          equity as a result of Landlord's default hereunder, in the event that
          Landlord defaults (i) in its obligation to provide

                                       23     Real Estate/Newport Beach Lease(3)

<PAGE>

          janitorial and window washing services pursuant to this Lease, (ii) in
          its obligation to keep certain items within the Premises or the
          Building in good repair as set forth in this Lease, and (iii) in
          paying to Tenant any allowances which may be due and owing under this
          Lease, then Tenant shall give Landlord written notice of such
          continuing default and Landlord shall have a reasonable time given the
          nature of such default, but in no event to exceed thirty (30) days
          within which to cure such default. In the event that Landlord does not
          cure such default within such time period, then Tenant shall have the
          right to perform such cure and Landlord shall reimburse Tenant for the
          direct out-of-pocket cost thereof promptly within thirty (30) days
          after Landlord's receipt of bills and receipts therefor. In the event
          Landlord does not so reimburse Tenant for such costs within thirty
          (30) days after the receipt of such bills and receipts, Tenant may
          set-off such amounts from the Rent next due and owing Landlord.

22.  Subordination

     This Lease is subject and subordinate in all respects to any underlying
     leases, ground leases, licenses or agreements, and to all mortgages which
     may now or hereafter be placed on or affect such leases, licenses or
     agreements or the Land or Building or the Premises and also to all
     renewals, modifications, consolidations and extensions of such underlying
     leases, ground leases, licenses, agreements, and mortgages; provided,
     however, that such subordination shall not be effective unless and until
     the Landlord, licensor and/or the holder of any mortgages execute and
     deliver to Tenant a subordination, non-disturbance and attornment agreement
     in form and substance consistent with Exhibit K ("SNDA Agreement"),
     reasonably satisfactory to Tenant in each instance stating and confirming
     that, among other things, that so long as there does not exist an uncured
     default hereunder as to which the applicable grace period has expired,
     Tenant's rights of possession and all other rights under this Lease,
     including without limitation Tenant's set-off rights contained in this
     Lease and termination rights contained herein, shall not be disturbed.
     Although no instrument or act on the part of Tenant shall be necessary to
     effectuate such subordination, Tenant shall, nevertheless, execute and
     deliver such further reasonable instruments confirming such subordination
     as may be desired by any holder of any such mortgage or by a lessor,
     licensor or party to an agreement under any such underlying lease, ground
     lease, license or agreement, respectively (so long as such subordination
     agreement does not contravene the provisions of this Section). This Lease
     is conditioned upon Landlord, Tenant and Landlord's current mortgagee,
     licensor and/or landlord entering into a commercially reasonable SNDA
     Agreement simultaneous with the execution of this Lease. If any underlying
     lease, ground lease, license or agreement to which this Lease is subject
     and subordinate terminates, or if any mortgage to which this Lease is
     subordinate is foreclosed, Tenant shall, on timely request, attorn to the
     holder of the reversionary interest or to the mortgagee in possession, as
     the case may be.

23.  Notices

     Any such notice, demand, statement or other communication shall be given in
     writing by or made upon hand delivery or by registered or certified mail,
     return receipt requested, or delivered, charges prepaid or charged to
     sender to a reputable private overnight delivery service, as the case may
     be, addressed to the respective parties as follows:

     To Landlord:

     Annod Corp., as Trustee
     c/o Hewitt Associates LLC
     100 Half Day Road
     Lincolnshire, IL 60069
     Attention: General Counsel
     with a copy to:

     PM Realty Group

                                       24     Real Estate/Newport Beach Lease(3)

<PAGE>

     4675 MacArthur Court, Suite 470
     Newport Beach, CA 92660
     with an additional copy to:

     PM Realty Group
     100 Bayview Circle-Suite 2040
     Newport Beach, CA 92660

     To Tenant:

     Hewitt Associates
     100 Half Day Road
     Lincolnshire, IL 60069
     Attention: General Counsel

     Notices shall be considered to have been given upon the earlier to occur of
     actual receipt or three (3) business days after posting in the United
     States mail or one (1) business day after deposit with a nationally
     recognized overnight carrier service. Any of the above addresses may be
     changed at any time notice is given as above provided.

24.  Quiet Enjoyment

     Landlord covenants that Tenant, upon keeping and performing each and every
     covenant, agreement, term, provision and condition herein contained on the
     part and on behalf of Tenant to be kept and performed, shall quietly enjoy
     the Premises without hindrance or molestation by Landlord or by any other
     person lawfully claiming by, through or under the same subject to the
     covenants, agreements, terms, provisions and conditions of this Lease and
     the effect of the application of same.

25.  Security Deposit

     Not required.

26.  Brokerage

     Each of Landlord and Tenant warrants to each other that it has had no
     dealings with any real estate broker or agent other than Procuring Broker
     as stated in paragraph 13 of the Lease Preamble in connection with the
     negotiation of the Lease, and that it knows of no other real estate broker
     or agent who is entitled to any commission or finder's fee in connection
     with this Lease. Each party will indemnify the other against any claim of
     breach of the warranty provided in this Section 26.

27.  Landlord's Inability to Perform

     Landlord shall not be in default under this Lease if Landlord is not able
     to supply any service or material called for herein, by reason of any rule,
     order, regulation or preemption by any governmental entity, authority,
     department, agency, or subdivision or for any delay which may arise by
     reason of negotiation for the adjustment of any fire or other casualty loss
     or because of strikes or other labor trouble or for any cause beyond the
     control of the Landlord. Except for Tenant's obligation to pay Rent due
     hereunder, Tenant shall not be in default under this Lease if Tenant is not
     able to supply any service or material called for herein, by reason of any
     rule, order, regulation or preemption by any governmental entity,
     authority, department, agency, or subdivision or any delay which may arise
     by reason of negotiation for the adjustment of any fire or other casualty
     loss or because of strikes or labor trouble or any cause beyond the
     reasonable control of Tenant.

                                       25     Real Estate/Newport Beach Lease(3)

<PAGE>

28.  Condemnation

     Tenant, at its sole option, may terminate this Lease if the whole or any
     material part of the Premises shall be taken or condemned for any public or
     quasi-public use under Law, by eminent domain or private purchase in lieu
     thereof (a "Taking"). Landlord and Tenant shall also have the right to
     terminate this Lease if there is a Taking of any portion of the Building
     which would leave the remainder of the Building unsuitable for use as an
     office building in a manner comparable to the Building's use prior to the
     Taking and such Taking makes it necessary to remodel or reconstruct the
     Building in a manner inconsistent with Tenant's use and occupancy or other
     material rights hereunder and such remodeling and reconstruction is
     reasonably estimated by Landlord to take more than 180 days to complete. In
     order to exercise its right to terminate the Lease, Landlord or Tenant, as
     the case may be, must provide written notice of termination to the other
     within 30 days after the terminating party first receives notice of the
     Taking. Any such termination shall be effective as of the date the physical
     taking of the Premises or the portion of the Building or Property occurs.
     If this Lease is not terminated, the Net Rentable Area of the Building, the
     Net Rentable Area of the Premises and Tenant's Proportional Share shall, if
     applicable, be appropriately adjusted. In addition, Rent for any portion of
     the Premises taken or condemned shall be abated during the unexpired Term
     of this Lease effective when the physical taking of the portion of the
     Premises occurs. All compensation awarded for a Taking, or sale proceeds,
     shall be the property of Landlord, any right to receive compensation or
     proceeds being expressly waived by Tenant. However, Tenant may file a
     separate claim at its sole cost and expense for Tenant's Property, Tenant's
     unamortized leasehold improvements, Tenant's interruption of damage to
     business, and Tenant's relocation expenses.

29. Assignment and Subletting

     (a)  In the event that Tenant desires to assign the Lease or any portion
          thereof or sublease the Premises or any portion thereof to any other
          party the terms and conditions of such assignment or sublease shall be
          communicated to Landlord in writing not less than thirty (30) days
          prior to the effective date of any such assignment or sublease.
          Landlord shall review such terms and conditions, and provide Tenant
          with its approval or disapproval within five (5) business days.

     (b)  Tenant may assign or sublet the whole or any portion of the Premises,
          subject to the Landlord's prior written consent, which consent shall
          not be unreasonably withheld, conditioned or delayed, and subject to
          the consent of any mortgagee, or ground lessor, and on the basis of
          the following terms and conditions:

          (i)   Tenant shall provide to Landlord the name and address of the
                assignee or sublessee.

          (ii)  In the case of an assignment of this Lease, the assignee shall
                assume, by written instrument, all of the obligations of this
                Lease, and a copy of such assumption agreement shall be
                furnished to Landlord at least ten (10) days prior to the
                effective date of the assignment or sublease.

          (iii) Tenant and each assignee shall be and remain liable for the
                observance of all the covenants and provisions of this Lease,
                including, but not limited to, the payment of Total Monthly
                Rent, Additional Rent and other charges due hereunder through
                the entire term of this Lease, as the same may be renewed,
                extended or otherwise modified.

          (iv)  Tenant shall share in the net gain (after deducting Tenant's
                expenses; including but not limited to commissions, marketing
                materials, design and alterations to the space, legal fees,
                etc.) at the rate of 50% to Tenant, 50% to Landlord of all rent,
                as and when received, in excess of the Total Monthly Rent and
                Additional Rent required to be paid by Tenant for the area
                assigned or sublet.

                                       26     Real Estate/Newport Beach Lease(3)

<PAGE>

           (v)      In any event, the acceptance by Landlord of any rent from
                    any of the assignees or subtenants or the failure of
                    Landlord to insist upon a strict performance of any of the
                    terms, conditions and covenants herein from any assignee or
                    subtenant shall not release Tenant herein, from any and all
                    of the obligations herein during and for the entire Term of
                    this Lease.

           (vi)     Tenant shall only assign or sublet the Premises to an
                    assignee or sublessee whose use is the same as or similar to
                    Tenant's use, the quality of such assignee or subtenant's
                    operations in the performance of said use to be acceptable
                    to Landlord, in Landlord's reasonable discretion.

           (vii)    Landlord shall be reimbursed by Tenant for the actual and
                    reasonable legal fees incurred by Landlord in connection
                    with the granting of any consent, such amount to be paid by
                    Tenant to Landlord within thirty (30) days after Landlord
                    renders to Tenant a copy of Landlord's actual invoice for
                    same.

           (viii)   The assignment or sublease shall provide that there shall be
                    no further assignments and/or subletting without Landlord's
                    consent.

     Notwithstanding anything to the contrary contained in this Lease to the
     contrary, Tenant shall have the right to assign this Lease or sublet all or
     any part of the Premises without the consent of Landlord to (1) any entity
     resulting from a merger or consolidation with Tenant or any organization
     purchasing substantially all of Tenant's assets, (2) any entity succeeding
     to substantially all the business and assets of Tenant, (3) any subsidiary,
     affiliate or parent of Tenant, (4) any entity controlling, controlled by or
     under common control with Tenant, or (5) any entity resulting from the
     reorganization of Tenant outside of a bankruptcy organization. In such
     event, Tenant shall notify Landlord of such transfer within fifteen (15)
     days after such transfer. For purposes of this Lease "control" shall mean
     the possession, direct or indirect, of the power to direct or cause the
     direction of the management and policies of an entity, whether through the
     ownership of voting securities, by contract, or otherwise.

30.  Environmental Laws

     (a)   Tenant agrees to comply with all applicable environmental laws, rules
           and regulations including Federal, state and local laws. Tenant shall
           not conduct any operations that shall cause the Building or the
           Premises to be deemed anything but an office building.

     (b)   Tenant hereby agrees to execute such documents Landlord reasonably
           deems necessary and to make such applications as Landlord reasonably
           requires to insure such compliance. Tenant shall bear all costs and
           expenses incurred by Landlord associated with any required compliance
           resulting from Tenant's use of the Premises including but not limited
           to state agency fees, engineering fees, clean-up costs, filing fees
           and suretyship expenses. As used in this Lease, compliance shall
           include applications for determinations of non-applicability by the
           appropriate governmental authority. The foregoing undertaking shall
           survive the expiration or sooner termination of the Lease and
           surrender of the Premises and shall also survive sale, or lease or
           assignment of the Premises by Landlord. Tenant shall immediately
           provide Landlord with copies of all correspondence, reports, notices,
           orders, findings, declarations and other materials pertinent to
           Tenant's compliance and the requirements as they are issued or
           received by the Tenant.

     (c)   Except for normal quantities of office and cleaning supplies, Tenant
           shall not generate, store, manufacture, refine, transport, treat,
           dispose of, or otherwise permit to be present on or about the
           Premises, any Hazardous Substances. As used herein, Hazardous
           Substances shall be defined as any "hazardous chemical," "hazardous
           substance" or similar term as defined in the Comprehensive
           Environmental Responsibility Compensation and Liability Act, as
           amended (42

                                       27     Real Estate/Newport Beach Lease(3)

<PAGE>

          U.S.C. 9601, et ~.), any rules or regulations promulgated thereunder,
          or in any other present or future applicable federal, state or local
          laws, rules or regulations dealing with environmental protection.

     (d)  Tenant agrees to indemnify and hold harmless the Landlord and each
          mortgagee of the Premises from and against any and all liabilities,
          damages, claims, losses, judgments, causes of action, costs and
          expenses (including the reasonable fees and expenses of counsel) which
          may be incurred by the Landlord or any such mortgagee or threatened
          against the Landlord or such mortgagee, relating to or arising out of
          any breach by Tenant of this Section, which indemnification shall
          survive the expiration or sooner termination of this Lease.

31. Parties Bound

     (a)  The covenants, agreements, terms, provisions and conditions of this
          Lease shall bind and benefit the respective successors, assigns and
          legal representatives of the parties hereto with the same effect as if
          mentioned in each instance where a party hereto is named or referred
          to except that no violation of the provisions of Section 29 shall
          operate to vest any rights in any successor, assignee or legal
          representative of Tenant and that the provisions of this Section 31
          shall not be construed as modifying the conditions contained in
          Section 29.

     (b)  Tenant acknowledges and agrees that if Landlord shall be an
          individual, joint venture, tenancy in common, firm, or partnership,
          general or limited, there shall be no personal liability on such
          individual or on the members of such joint venture, tenancy in common,
          firm or partnership in respect of any of the covenants or conditions
          of this Lease; rather, Tenant agrees to look solely to Landlord's
          estate and property in the Land, Building, and Common Areas (or the
          proceeds thereof) for the satisfaction of Tenant's remedies arising
          out of or related to this Lease.

     (c)  The term "Landlord" as used in this Lease means only the owner, or the
          mortgagee in possession, for the time being of the Premises (or the
          owner of a lease of the Premises) so that in the event of any sale or
          sales of the Land, Building, or the Premises or of said lease, or in
          the event of a lease of the Land, Building or the Premises, said
          Landlord shall be and hereby is entirely freed and relieved of all
          covenants and obligations of Landlord hereunder accruing after such
          sale or lease, and it shall be deemed and construed without further
          agreement between the parties or their successors in interest, or
          between the parties and the purchaser, at any such sale, or the said
          lessee of the Land, Building or of the Premises, that the purchaser or
          the lessee of the same has assumed and agreed to carry out any and all
          covenants and obligations of Landlord hereunder.

32. Estoppel Certificate

     (a)  Within ten (10) business days following any written request which one
          party may make from time to time, the other party shall execute and
          deliver to the requesting party a statement in similar to Exhibit H
          attached hereto, certifying:

          (i)   the date of commencement of this Lease;

          (ii)  the fact that this Lease is unmodified and in full force and
                effect (or, if there have been modifications hereto, that this
                Lease is in full force and effect as modified, and stating the
                date and nature of such modifications);

          (iii) the date to which the rental and other sums payable under this
                Lease have been paid;

          (iv)  the fact that there are no current defaults under this Lease
                by either the Landlord or Tenant except as specified in such
                statement; and

                                       28     Real Estate/Newport Beach Lease(3)

<PAGE>

           (v)      such other matters as are reasonably required by the
                    requesting party. Landlord and Tenant intend that any
                    statement delivered pursuant to this Section 32. may be
                    relied upon by any lender or any mortgagee, beneficiary,
                    purchaser or prospective purchaser of the Building or any
                    interest therein.

     (b)   Tenant's or Landlord's failure to deliver such statement within such
           time shall be conclusive upon the non-delivering party that:

           (i)      this Lease is in full force and effect without modification,
                    except as may be stated in the certificate originally
                    presented to the non-delivering party;

           (ii)     there are no uncured defaults in requesting party's or
                    non-delivering party's performance; and

           (iii)    not more than one (1) month's rental has been paid in
                    advance.

33.  Holding Over

     (a)   Tenant shall not hold over after the expiration of the Term or
           earlier  termination of this Lease without the prior written consent
           of Landlord. Tenant agrees that Tenant's failure to surrender
           possession of the Premises at the end of the Term can and will cause
           actual damage to Landlord which is impracticable or extremely
           difficult to ascertain (including, without limitation, lost
           opportunities to lease the Premises, increase the cost of
           improvements, lost rent and liability for Landlord's inability to
           deliver timely possession of the Premises to another tenant).
           Therefore, if Tenant holds over after the Term without the prior
           written consent of Landlord, then Tenant shall become a Tenant at
           sufferance only and shall continue to perform each and every term,
           condition and covenant of this Lease during any such period of
           holding over; except that, in lieu of damages to which Landlord may
           be entitled hereunder, Landlord may elect to have Tenant pay Landlord
           liquidated damages in an amount equal to one hundred twenty-five
           percent (125%) of the Total Monthly Rent payable by Tenant to
           Landlord in the last complete month of the Term, for each month or
           portion thereof which Tenant so holds over.

     (b)   If Landlord consents to Tenant's holding over after the expiration of
           the Term or earlier termination of this Lease, then the tenancy shall
           continue from month-to-month upon the same terms, conditions and
           covenants contained in this Lease, except that for each month or
           portion thereof that the Tenant holds over, Tenant shall pay to
           Landlord rent equal to one hundred twenty-five (125%) of the Total
           Monthly Rent payable by Tenant in the last complete month of the
           Term.

     (c)   The foregoing provisions of this Section are in addition to any other
           rights of Landlord hereunder, or as otherwise provided by law,
           including, without limitation, the right to bring an action for
           unlawful detainer. Landlord's acceptance of rent after expiration or
           earlier termination of this Lease, or during any such period of
           holding over shall not be construed as a renewal or extension of this
           Lease. Notwithstanding anything to the contrary contained in this
           Lease, Tenant shall not be entitled to any parking discounts or
           specific modes of parking during such period of hold over.

34.  Attorney's Fees

     If either Landlord or Tenant brings to suit to interpret or enforce any
     provision of this Lease or any rights of either party hereto, then the
     prevailing party shall recover from the other party all costs and expenses,
     including reasonable attorney's fees. Notwithstanding the provisions of
     California Civil Code section 1717, the term "prevailing party" as used
     herein shall include, without limitation, both a

                                       29     Real Estate/Newport Beach Lease(3)

<PAGE>

     party as to who a lawsuit is dismissed (with or without prejudice) without
     the written consent of that party and, if the lawsuit is one for
     declaratory relief, that party whose contentions are substantially upheld
     as to the interpretations of this Lease. Any attorney's fees payable
     pursuant to this Section may be claimed either as court costs or in a
     separate suit.

35.  Waiver of Jury Trial

     Landlord and Tenant each hereby waive their respective rights to trial by
     jury of any cause of action, claim, counterclaim or cross-complaint in any
     action, proceeding and/or hearing brought by either Landlord against
     Tenant, or Tenant against Landlord, as to any matter whatsoever arising out
     of or in any way connected with this Lease, the relationship of Landlord
     and Tenant, Tenant's use or occupancy of the Premises, any claim of injury
     or damage, or the enforcement of any remedy under any law, statue, or
     regulation, emergency or otherwise, now or hereafter in effect.
     Notwithstanding the foregoing, Landlord and Tenant agree that this waiver
     shall not be effective where the legal effect of such waiver would be to
     invalidate in whole or in part, or to limit or impair in any manner any
     policy of insurance in force for the benefit of Landlord or Tenant or to
     limit or impair any rights, remedies or coverage afforded thereunder.

36.  Waiver

     No waiver by Landlord of any provision of this Lease or of any breach by
     Tenant hereunder shall be deemed to be a waiver of any other provision
     hereof, or of any subsequent breach by Tenant of the same or any other
     provision. Landlord's consent to or approval of any act by Tenant requiring
     Landlord's consent or approval shall not be deemed to render unnecessary
     the obtaining of Landlord's consent to or approval of any subsequent act of
     Tenant. No act or thing done by Landlord or Landlord's agents during the
     term of this Lease shall be deemed an acceptance of a surrender of the
     Premises, unless done in writing signed by Landlord. The delivery of the
     keys to any employee or agent of Landlord shall not operate as a
     termination of the Lease or a surrender of the Premises. The acceptance of
     any rent by Landlord following a breach of this Lease by Tenant shall not
     constitute a waiver by Landlord of such breach or any other breach unless
     such waiver is expressly stated in a writing signed by Landlord.

37.  Examination of Lease

     Submission of this instrument for examination or signature does not
     constitute a reservation or option for Lease, and it is not effective as a
     Lease or otherwise until execution by and delivery to both Landlord and
     Tenant.

38.  Corporate Authority

     If a party executes this Lease as a limited liability company, corporation,
     or other corporate entity, each of the parties does hereby covenant and
     warrant to the other party that it is a duly authorized and existing entity
     under the laws of the state of its organization, is qualified to do
     business in California, that it has full right and authority to enter into
     this Lease, and that each person signing on behalf of it is authorized to
     do so.

39.  No Light, Air or View Easement

     Any diminution or shutting off of light, air or view by any structure which
     may be erected on lands adjacent to the Building shall in no way affect
     this Lease or impose any liability on Landlord.

                                       30     Real Estate/Newport Beach Lease(3)

<PAGE>

40.  Miscellaneous

     (a)   This Lease contains the entire contract between the parties with
           respect to the subject matter hereof. No representative, agent or
           employee of Landlord has been authorized to make any representations
           or promises with reference to the leasing of the Premises or to vary,
           alter or modify the terms hereof. No additions, changes or
           modifications, renewals, or extensions (unless Tenant exercises its
           right to extend the Term as provided herein or as otherwise expressly
           provided in this Lease) hereof, shall be binding unless reduced to
           writing and signed by Landlord and Tenant.

     (b)   The terms, conditions, covenants and provisions of this Lease shall
           be deemed to be severable. If any clause or provision herein
           contained be adjudged to be invalid or unenforceable by a court of
           competent jurisdiction or by operation of any applicable law, it
           shall not affect the validity of any other clause or provision
           herein, but such other clauses or provisions shall remain in full
           force and effect.

     (c)   Tenant shall not be entitled to exercise any right of termination or
           other option granted to it by this Lease at any time when Tenant is
           in default in the performance or observance of any of the covenants,
           agreements, terms, provisions or conditions on its part to be
           performed or observed under this Lease beyond applicable notice and
           cure periods.

     (d)   The Section headings in this Lease are for convenience only and are
           not to be considered in construing the same.

     (e)   If, in connection with obtaining financing for the Building, a
           banking, insurance or other recognized institutional lender shall
           request reasonable modifications in this Lease as a condition to such
           financing, Tenant will not unreasonably withhold, delay or defer its
           consent thereto, provided that such modifications do not increase the
           financial or other obligations of Tenant hereunder or adversely
           affect the leasehold interest created or the conduct of Tenant's
           business operations at the Premises.

     (f)   Conflict of Laws: This Lease shall be governed by and construed under
           the laws of the State of California.

     (g)   Venue: Any lawsuit brought by Tenant against Landlord shall be filed
           in a court of competent jurisdiction in the County of Orange,
           California.

     (h)   Interest: Wheresoever required in this Lease, and in lieu of the
           legal rate to be used in the computation of any interest owed
           Landlord in any judgement or award of the court, interest shall be
           charged at a rate equal to the higher of:

           (i)  Seven percent (7%) per annum; or

           (ii) Two percent (2%) per annum, plus the rate established by the
                Federal Reserve Bank of San Francisco on advances to member
                banks under Sections 13 and 13(a) of the Federal Reserve Act (as
                now in effect, or hereafter from time to time amended or, if
                there is no such single terminable rate of advances, the closest
                counterpart of such rate as shall be designated by the
                Superintendent of Banks of the State of California, unless some
                other person or agency is delegated such authority by the
                legislature) which is prevailing on the twenty-fifth (25th) day
                of the month preceding the "Accrual Date".

           The "Accrual Date" shall be defined as follows: for purposes of
           Section 40.(h)(ii), as the initial date of default; for the purposes
           of Section 6, the date of final payment by Landlord for the Capital
           Expense; and for all other purposes, the date of execution of this
           Lease. Tenant hereby

                                       31     Real Estate/Newport Beach Lease(3)

<PAGE>

           agrees that the use of such interest rate herein shall not be deemed
           to be interest upon a loan or forbearance of money, for goods or
           things in action for use primarily for personal, family or household
           purposes within the meaning of the California Constitution, Article
           15, section 1.

     (i)   Time is of the essence with respect to the performance of every
           provision of this Lease in which time of performance is a factor.

     (j)   The exhibits attached hereto are hereby incorporated herein by this
           reference and made a part of this Lease.

     (k)   At Tenant's request Landlord shall execute and deliver to Tenant and
           Tenant may record a memorandum of this Lease, and appropriate
           amendments or supplements thereto from time to time, in form and
           substance reasonably satisfactory to Landlord and Tenant, reflecting
           the existence of this Lease and Tenant's rights hereunder and setting
           forth an accurate description of the floors constituting the
           Premises, the Term, and all options to renew the Term or to expand
           the floors constituting the Premises and the timing of such options,
           together with Tenant's exclusive rights granted pursuant to this
           Lease.

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

<TABLE>
<S>                                                    <C>
LANDLORD: ANNOD CORP., not                             TENANT: HEWITT ASSOCIATES LLC
personally but solely
as trustee of The
Bayview Trust

By:                                                    By:
    --------------------------                             ---------------------------
    C. L. Connolly, III                                Dale L. Gifford
    President                                          Title: CEO and Authorized Representative
</TABLE>

                                       32     Real Estate/Newport Beach Lease(3)

<PAGE>

                                    EXHIBIT A

                              RULES AND REGULATIONS

 1.  No sign, placard, picture, advertisement, name or notice shall be installed
     or displayed on any part of the exterior or interior Common Areas of the
     Building without the prior written consent of Landlord or as otherwise
     expressly permitted in this Lease. Landlord shall have the right to remove,
     at Tenant's expense and without notice, any sign installed or displayed in
     violation of this rule. All approved signs or lettering on doors and walls
     shall be printed, painted, affixed or inscribed at the expense of Tenant by
     a person chosen by Landlord.

 2.  No awning shall be permitted on any part of the Premises. Tenant shall not
     place anything against or near glass partitions or doors or windows which
     may appear unsightly from outside the Premises or anything on the balconies
     or the handrails of the building.

 3.  Landlord shall retain the right to control and prevent access to the
     Building of all persons whose presence in the reasonable judgment of
     Landlord would be prejudicial to the safety, character, reputation and
     interests of the Building and its tenants; provided that nothing herein
     contained shall be construed to prevent such access to persons with whom
     any tenant normally deals in the ordinary course of its business, unless
     such persons are engaged in illegal activities. No tenant and no employee
     or invitee of any tenant shall go upon the roof of the Building unless
     accompanied by Landlord or Landlord's representative.

 4.  All cleaning and janitorial services for the Building and the Premises
     shall be provided exclusively through Landlord (except as provided
     otherwise in this Lease), and except with the written consent of Landlord,
     no person or persons other than those approved by Landlord shall be
     employed by Tenant or permitted to enter the Building for the purpose of
     cleaning the same. Tenant shall not cause any unnecessary labor by
     carelessness or indifference to the good order and cleanliness of the
     Premises. Landlord shall not in any way be responsible to any Tenant for
     any loss of property on the Premises, however occurring, or for any damage
     to any Tenant's property by the janitor or any other employee or any other
     person.

 5.  At Tenant's cost, Landlord will furnish Tenant keys and/or keycards
     requested by Tenant. Tenant shall not alter any lock or install a new
     additional lock or bolt on any door of its Premises. Tenant, upon the
     termination of its tenancy, shall deliver to Landlord the keys and/or
     keycards of all doors which have been furnished to Tenant, and in the event
     of loss of any keys so furnished, shall pay Landlord for cost to
     reconfigure locks and provide for replacement keys as required.

 6.  If Tenant requires telegraphic, telephonic, burglar alarm or similar
     services, it shall first obtain, and comply with, Landlord's reasonable
     instructions in their installation.

 7.  Any freight elevator (other than the service elevator connecting the lower
     level parking area, the first and fourth floors of the Demised Premises and
     used exclusively by Tenant) shall be available for use by all tenants in
     the Building, subject to such reasonable scheduling as Landlord in its
     discretion shall deem appropriate. No equipment, materials, furniture,
     packages, supplies, merchandise or other property will be received in the
     Building or carried in the elevators except between such hours and in such
     elevators as may be reasonably designated by Landlord.

 8.  Tenant shall not place a load upon any floor of the Premises which exceeds
     the load per square foot which such floor was designed to carry and which
     is allowed by law. Heavy objects shall, if considered necessary by
     Landlord, stand on such platforms as determined by Landlord to be necessary
     to properly distribute the weight. Business machines and mechanical
     equipment belonging to Tenant, which cause noise or vibration that may be
     transmitted to the structure of the Building or

                                       33     Real Estate/Newport Beach Lease(3)

<PAGE>

     to any space therein to such a degree as to be objectionable to Landlord or
     to any tenants in the Building, shall be placed and maintained by Tenant,
     at Tenant's expense, on vibration eliminators or other devices sufficient
     to eliminate noise or vibration. The persons employed to move such
     equipment in or out of the Building must be acceptable to Landlord.
     Landlord will not be responsible for loss of, or damage to, any such
     equipment or other property from any cause, and all damage done to the
     Building by maintaining or moving such equipment or other property shall be
     repaired at the expense of Tenant.

 9.  Tenant shall not use or keep in the Premises any kerosene, gasoline or
     inflammable or combustible fluid or material other than those limited
     quantities necessary for the operation or maintenance of office equipment.
     Tenant shall not use or permit to be used in the Premises any foul or
     noxious gas or substance, or permit or allow the Premises to be occupied or
     used in a manner offensive or objectionable to Landlord or other occupants
     of the Building by reason of noise, odors or vibrations, nor shall Tenant
     bring into or keep in or about the Premises any birds or animals (except
     animals assisting disabled persons).

10.  Tenant shall not use any method of heating or air-conditioning other than
     that supplied by Landlord or that have been approved by Landlord prior to
     installation (e.g. data center HVAC).

11.  Tenant shall cooperate fully with Landlord to assure the most effective
     operation of the Building's heating and air-conditioning and to comply with
     any governmental energy-saving rules, laws or regulations of which Tenant
     has actual notice, and shall refrain from attempting to adjust controls
     other than room thermostats installed for Tenant's use. Tenant shall keep
     corridor doors closed and shall use its best efforts to close window
     coverings at the end of each business day.

12.  Landlord reserves the right, exercisable with thirty (30) days advance
     written notice and without liability to Tenant, to change the name and
     street address of the Building; provided, however, Landlord shall be
     responsible for reimbursing Tenant for Tenant's actual out-of-pocket costs
     incurred in changing Tenant's stationary and similar items.

13.  Landlord reserves the right to exclude from the Building between the hours
     of 6 p.m. and 8 a.m. the following day, or such other hours as may be
     established from time to time by Landlord, and on Sundays and legal
     holidays, any person unless that person is known to the person or employee
     in charge of the Building and has a pass or is properly identified. Tenant
     shall be responsible for all persons for whom it requests passes and shall
     be liable to Landlord for all acts of such persons. Landlord shall not be
     liable for damages for any error with regard to the admission to or
     exclusion from the Building of any person. Landlord reserves the right to
     prevent access to the Building in case of invasion, mob action, riot,
     public excitement or other commotion by closing the doors or by other
     appropriate action.

14.  Tenant shall close and lock the doors of the Premises and entirely shut off
     all water faucets or other water apparatus, and electricity, gas or air
     outlets before Tenant and its employees leave the Premises. Tenant shall be
     responsible for any damage or injuries sustained by other tenants or
     occupants of the Building or by Landlord for noncompliance with this rule.

15.  Tenant shall not obtain for use of the Premises ice, drinking water, food,
     beverage, towel or other similar services or accept barbering or
     bootblacking services upon the Premises except at such hours and under such
     reasonable regulations as may be fixed by Landlord.

16.  The toilet rooms, toilets, urinals, wash bowls and other apparatus shall
     not be used for any purpose other than that for which they were constructed
     and no foreign substance of any kind whatsoever shall be thrown thereto.
     The expense of any breakage, stoppage or damage resulting from the
     violation of this rule shall be borne by the tenant who, or whose employees
     or invitees shall have caused it.

                                       34     Real Estate/Newport Beach Lease(3)

<PAGE>

17.  Tenant shall not sell, or permit the sale at retail, of newspapers,
     magazines, periodicals, theater tickets or any other goods or merchandise
     to the general public in or on the Premises. Tenant shall not make any
     room-to-room solicitation of business from other tenants in the Building.

18.  Tenant shall not install any loud-speaker on the roof or exterior walls of
     the Building but may install (at its sole cost and expense) antennae or
     other devices thereon so long as they do not visibly and materially detract
     from the appearance of the Building. Tenant shall not interfere with radio
     or television broadcasting or reception from or in the Building or
     elsewhere.

19.  Except for the hanging of artwork and as provided in the Lease, Tenant
     shall not mark, drive nails, screw or drill into the partitions, woodwork
     or plaster or in any way deface the Premises or any part thereof. Landlord
     reserves the right to direct electricians as to where and how telephone and
     telegraph wires are to be introduced to the Premises. Tenant shall not cut
     or bore holes for wires. Tenant shall not affix any floor covering to the
     floor of the Premises in any manner except as reasonably approved by
     Landlord. Tenant shall repair any damage resulting from noncompliance with
     this rule.

20.  Tenant shall not install, maintain or operate upon the Premises any vending
     machine, except for Tenant's exclusive use, without the written consent of
     Landlord (which shall not be unreasonably withheld, conditioned or
     delayed).

21.  Canvassing, soliciting and distribution of handbills or any other written
     material, and peddling in the Building are prohibited, and each tenant
     shall cooperate to prevent same.

22.  Landlord reserves the right to exclude or expel from the Building any
     person who, in Landlord's judgment, is intoxicated or under the influence
     of liquor or drugs or who is in violation of any of the Rules and
     Regulations of the Building.

23.  Tenant shall store all its trash and garbage within the Premises. Tenant
     shall not place in any trash box or receptacle any material which cannot be
     disposed of in the ordinary and customary manner of trash and garbage
     disposal. All garbage and refuse disposal shall be made in accordance with
     directions issued from time to time by Landlord.

24.  The Premises shall not be used for the storage of merchandise held for sale
     to the general public, or for lodging or for manufacturing of any kind, nor
     shall the Premises be used for any illegal purpose. No cooking shall be
     done or permitted by any tenant on the Premises, except that (i) use by
     Tenant of Underwriters' Laboratory approved equipment for brewing coffee,
     tea, hot chocolate and similar beverages, and (ii) Tenant's on-site food
     preparation and dining for Tenant's employees, invitees and guests, shall
     be permitted, provided that such equipment and use is in accordance with
     all applicable federal, state, county and city laws, codes, ordinances,
     rules and regulations.

25.  Tenant shall not use in any space or in the public halls of the Building
     any hand trucks except those equipped with rubber tires and side guards or
     such other material handling equipment as Landlord may approve. Tenant
     shall not bring any other vehicles of any kind into the Building without
     Landlord's prior reasonable consent.

26.  Without the written consent of Landlord, Tenant shall not use the name of
     the Building in connection with or in promoting or advertising the business
     of Tenant except as Tenant's address.

27.  Tenant shall comply with all safety fire protection and evacuation
     procedures and regulations established by Landlord or any governmental
     agency.

28.  Tenant assumes any and all responsibility for protecting the Premises from
     theft, robbery and

                                       35     Real Estate/Newport Beach Lease(3)

<PAGE>

     pilferage.

29.  The requirements of Tenant will be attended to only upon written
     application to the office of the Building Manager by an authorized
     individual.

30.  Tenant shall not park its vehicles in any parking areas designated by
     Landlord as areas for parking by visitors to the Building, without prior
     notification to Landlord.

31.  Landlord may waive any one or more of these Rules and Regulations for the
     benefit of Tenant or any other tenant, but no such waiver by Landlord shall
     be construed as a waiver of such Rules and Regulations in favor of Tenant
     or any other tenant, nor prevent Landlord from thereafter enforcing any
     such Rules and Regulations against any or all of the tenants of the
     Building. Landlord shall enforce all Rules and Regulations in a
     non-discriminatory manner.

32.  These Rules and Regulations are in addition to, and shall not be construed
     to in any way modify or amend, in whole or in part, the terms, covenants,
     agreements and conditions of any lease of premises in the Building. In the
     event of conflict between the provisions contained in this Lease and these
     Rules and Regulations the provisions of this Lease shall prevail.

33.  Landlord reserves the right to make such other and reasonable Rules and
     Regulations as, in its judgment, may from time to time be needed for safety
     and security, for care and cleanliness of the Building and for the
     preservation of good order therein. Tenant agrees to abide by all such
     Rules and Regulations herein above stated and any additional rules and
     regulations which are adopted after receiving notice of same from Landlord.

34.  Tenant shall be responsible for the observance of all of the foregoing
     rules by Tenant's employees, agents, clients, customers, invitees and
     guests.

                                       36     Real Estate/Newport Beach Lease(3)

<PAGE>

                                    EXHIBIT B

                                BUILDING HOLIDAYS

Holidays shall be:

     Memorial Day;
     Independence Day;
     Labor Day;
     Thanksgiving Day;
     Christmas Day;
     and New Years Day.

                                       37     Real Estate/Newport Beach Lease(3)

<PAGE>

                                    EXHIBIT C

                                LEGAL DESCRIPTION

That certain real property located in the County of Orange, State of California,
described as follows:

Parcel "A":

Parcel A-1: Lot 2 of Tract No. 12528, in the City of Newport Beach, County of
Orange, State of California, as per Map recorded in Book 551, Pages 38 to 41,
inclusive of Miscellaneous Maps, in the office of the County Recorder of said
County, lying within the land described as Parcel 1 of that certain Lot Line
Adjustment No. 87-2 recorded September 21, 1988 as Instrument No. 88-479139 of
Official Records.

Parcel "B":

A non-exclusive easement for pedestrian and vehicular ingress and egress over
Lot A, Tract No. 12528, as shown on Map recorded January 23, 1986 as Document
No. 86-030142, in Book 551, Pages 38 to 41, inclusive of Miscellaneous Maps,
records of Orange County, California, for the benefit of Lots 2, 5 and 7 of
Tract No. 12528, as shown on Map recorded on January 23, 1986 as Document
No. 86-030142, in Book 551, Pages 38 to 41, Inclusive of Miscellaneous Maps,
records of Orange County, California.

                                       38     Real Estate/Newport Beach Lease(3)

<PAGE>

                                    EXHIBIT D

                           ALTERATIONS TO THE PREMISES

     1.   Working Restrictions

     a.   All Tenant's Work, as well as any alteration, additions or changes
          which shall be performed by Tenant and/or Tenant's contractors,
          vendors or suppliers during the Term of the Lease, shall be performed
          in strict compliance with the following:

          1.   A Certificate of Insurance from a reputable insurance company,
               furnished by Tenant and/or Tenant's Personnel to Landlord in an
               amount of not less than One Million ($1,000,000) dollars for
               Commercial General Liability with bodily injury liability and
               property damage liability including blanket contractual
               liability, completed operations, independent contractor, and
               broad form property damage coverage showing Landlord, and PM
               Realty Group as insured.

               In addition, Worker's Compensation Insurance covering all
               employees of Tenant and Tenant's Personnel in accordance with the
               State of California; Employer's Liability Insurance in accordance
               with the laws of the State of California, but in no event an
               amount less than the following:

                (i)   Bodily Injury by Accident        $500,000 each Accident

                (ii)  Bodily Injury by Disease         $500,000 each Employee

                (iii) Bodily Injury by Disease         $500,000 policy limit

               And, Automobile Liability with Bodily injury and property damage
               limits of not less than $1,000,000 combined single limit.

               Each and all contractors and subcontractors shall furnish
               Landlord with certificates of insurance before commencing work on
               the Building property or Premises. Each certificate shall state
               that the insurance evidenced by such certificate will not be
               canceled or reduced except after 30 days prior written notice to
               Landlord;

          b.   All such work shall be done in conformity with a valid building
               permit when required, issued by the public or governmental
               authority having jurisdiction, a copy of which shall be furnished
               to Landlord before the work is commenced;

          c.   Tenant and/or Tenant's contractor(s), and Landlord and/or
               Landlord's contractors shall coordinate, perform and construct
               and install their work so as not to interfere unreasonably with,
               delay or hinder the other in the performance of its work;

          d.   Tenant shall reimburse Landlord for any reasonable extra expenses
               incurred by Landlord for the correction of any faulty work done
               by Tenant and/or its contractor(s), or by reason of inadequate
               clean-up, repair of damages to the Building or the Premises
               caused as a result of contractor operations; and

          e.   Nothing shall be installed or permitted to be installed that
               would exceed or be likely to exceed the maximum floor loading of
               One Hundred (100) square pounds (static live and

                                       39     Real Estate/Newport Beach Lease(3)

<PAGE>

               dead loads) per square foot without Landlord's prior written
               approval. Tenant will secure at its expense, complete detailed
               plans certified by a licensed structural engineer in the State of
               California showing that the aforementioned limit has not been
               exceeded when, in the Landlord's opinion, there is question about
               Tenant's distribution of floor loading.

          f.   In the event Tenant desires to increase the maximum floor loading
               capacity, Tenant, at its sole cost, will submit to Landlord for
               review and approval, which will not be unreasonably withheld,
               conditioned or delayed, a complete set of construction plans of
               the associated improvements certified by licensed engineers in
               the State of California. Said improvement area will be clearly
               outlined on the floor and no loads exceeding the aforementioned
               maximum capacity will be permitted outside the outlined area.

                                       40     Real Estate/Newport Beach Lease(3)

<PAGE>

                                    EXHIBIT E

                   OPERATING AND CAPITAL EXPENSE - EXCLUSIONS

(a)  Wages, salaries, fees and fringe benefits paid to administrative or
     executive personnel or officers or partners of the Landlord or Landlord's
     property manager.

(b)  Any charge for depreciation of the Building or equipment and any interest
     or other financing charge.

(c)  Any charge for Landlord's income taxes, excess profit taxes, or franchise
     taxes on Landlord's or property manager's business.

(d)  All costs relating to activities for the solicitation and execution of
     leases of space in the Building, including, but not limited to, brokers
     commissions and attorney fees, architecture and engineering services.

(e)  All costs for which Tenant or other tenants in the Building is being
     charged other than pursuant to the operating expense of the Building.

(f)  The cost of correcting material defects in the construction of the
     Building, Building parking structure or, the Building's equipment, except
     that such conditions resulting from ordinary wear and tear will not be
     deemed defects for the purpose of this exclusion.

(g)  The cost of any repairs made by Landlord because of the total or partial
     destruction of the Building or the condemnation of a portion of the
     Building.

(h)  The cost of any items for which Landlord is reimbursed by insurance or
     otherwise compensated by parties other than the tenants of the Building.

(i)  The cost of any Building or parking structure additions subsequent to the
     date of the original construction of the Building.

(j)  The cost of any repairs, alterations, additions, changes, replacements and
     other items which, under generally accepted accounting principles are
     properly classified as capital expenditures except as provided in the
     Lease.

(k)  Any operating expense representing an amount paid to a related corporation,
     entity, or person which is excess of the amount which would have otherwise
     be paid (by competitive bid) in the absence of such relationship.

(l)  The cost of tools and equipment used initially in the construction of the
     Building and parking structure.

(m)  The cost of any work or service performed for any tenant of the Building to
     a greater extent or, in a manner more favorable to such tenant that that
     performed for, or furnished to, Tenant.

(n)  The cost of any design to, or alterations of, space in the Building leased
     or, will be leased, to other Tenants.

(o)  The cost of overtime or other expense related to Landlord curing its
     defaults.

(p)  Capital improvements or expenditures incurred to reduce operating expenses
     shall be included in operating expenses to the smaller of: amount
     annualized over the useful life of the improvement or, the actual savings
     using generally accepted accounting principles.

(q)  The cost to comply with any environmental regulations, ADA or, with any
     orders and/or ordinances from any regulatory agency excluding the cost of
     removal of chlorofluocarbons (CFC) or, any adaptation of Building HVAC
     systems to use substances other than CFC.

(r)  Any penalty charges incurred by Landlord due to violation of any law
     (including, but not limited

                                       41     Real Estate/Newport Beach Lease(3)

<PAGE>

     to, late payment fees).

(s)  Costs for sculptures, paintings and other objects of art located within the
     Building, except only for the costs of maintaining such objects in the
     public areas of the Building.

(t)  The cost of installing operating or maintaining any specialty facility
     including, but not limited to, athletic club, luncheon club dining facility
     or other facilities operated with the intent of producing profit not
     strictly related to the operation of the Building for office uses.

                                    EXHIBIT F

                                TENANT'S OPTIONS

1.   Options to Extend

Tenant shall have two (2) Options to Extend for a period of five (5) years each.
The Option to Extend will commence the following day following the initial
fifteen (15) year term upon the following terms and conditions:

     a.   The Tenant is not in material default, with all required written
          notices given and all applicable cure periods expired, under any
          terms, covenants, conditions and provisions of the Lease at the time
          of exercising the Option.

     b.   That such Option to Extend shall be upon the same terms, covenants,
          conditions and provisions of this Lease.

     c.   Tenant shall exercise this Option to Extend as follows:

               (i)   On or before nine (9) month's prior to the initial
                     Termination Date, Tenant shall notify Landlord of Tenant's
                     interest in exercising the Option to Extend;

               (ii)  Landlord shall, within thirty (30) days, present Tenant
                     with Landlord's proposal for the Fair Market Rate for the
                     Extension term requested when an increase above current
                     rates is warranted;

               (iii) Tenant can a) accept Landlord's FMR; b) reject Landlord's
                     FMR and move onto FMR determination as per paragraph 2; or
                     c) terminate/rescind the renewal notice.

               (iv)  This Option to Extend is for Tenant's use and can not be
                     assigned or transferred to a Permitted Transferee or other
                     successor or assignee that fully complies with the
                     assignment provisions stipulated in the Lease.

2.   Fair Market Rate

For the purposes hereof, the term "Fair Market Rate" shall mean the monthly
amount per Net Rentable Area that a willing, comparable, new non-expansion,
non-equity tenant would pay, and a willing, comparable landlord of a comparable
class A office building with comparable vacancy within a five (5) mile radius of
the Building would accept, at arm's length for a comparable amount of space for
a comparable period of time giving appropriate consideration to the monthly
rental rates per rentable square feet, the type of operating expenses escalation
clauses typically granted tenants, abatement of rent if any, length of lease
term, size and location of the premises being leased, tenant improvement
allowance in pre-improved space if any, and other generally applicable
conditions of tenancy of a multi-floor tenant. Landlord and Tenant shall
commence negotiations to agree upon the Fair Market Rate ("FMR") upon the

                                       42     Real Estate/Newport Beach Lease(3)

<PAGE>

delivery of a FMR by the Landlord. If both parties are unable to reach agreement
of FMR within fifteen (15) business days after delivery by Landlord, the FMR
shall be determined in accordance with the sub-sections (a) through (c) below:

a)   If Landlord and Tenant are unable to agree in FMR within fifteen (15)
     business days, within the next five (5) business days thereafter, Landlord
     and Tenant shall simultaneously submit to the other, in a sealed envelope,
     its good-faith estimate of FMR. If the higher of such estimates is not more
     than one hundred five percent (105%) of the lower such estimate, then the
     FMR shall be the average of the two submitted estimates.

b)   If the FMR is not resolved by the exchange of the estimates, then either
     the Landlord or the Tenant may by written notice ("Notice to Arbitrate") to
     the other within five (5) business days of the exchange, require that the
     disagreement in terms be resolved by arbitration. Within five (5) business
     days after such notice, the parties shall select a mutually acceptable MAI
     appraiser with experience in commercial office leasing activities,
     including at least ten (10) years of experience in appraising office space
     comparables in the Newport Beach / Irvine area. The selection of the
     arbitrator shall be rendered in writing to both Landlord and Tenant and
     whose opinion of FMR shall be final and binding upon both parties. If the
     arbitrator believes that expert advice would materially assist him/her,
     he/she may retain one or more qualified persons.

c)   Once the arbitrator has been selected, then, as soon thereafter as
     practical, but in no case later than ten (10) business days, the arbitrator
     shall select one of the two estimates of FMR provided by Landlord and
     Tenant, which must be the one that is closest to the FMR estimate that was
     independently established by the arbitrator. The party whose estimate is
     not chosen as the closest to the arbitrator's shall pay the costs of the
     arbitrator and any of experts retained by the arbitrator. Any fees of any
     counsel or expert engaged directly by Landlord or Tenant however, shall be
     borne by the respective party retaining such counsel or expert.

3.   Signage Rights

Tenant shall retain its rights for Building top signage, as well as front entry
monument signage and, monument signage on Bristol Ave. Tenant may also use its
corporate logo on entry doors, with all such costs to be paid solely by Tenant.
In addition, Tenant shall have the rights to up to twenty (20) strips for
Tenant's names on the directory board in the Lobby of the Building at Landlord's
cost.

4.   Tenant's Right to Audit

Tenant or its representative shall have the right, during Landlord's normal
business hours, within one hundred and twenty (120) days following the
furnishing by Landlord of an annual statement described above in Sections 5.d
and 6.c and upon reasonable prior notice to Landlord, to inspect Landlord's
books and records showing the Operating Expenses reflected in such annual
statement: provided however, that the foregoing shall not relieve Tenant of
paying any deficiency shown by Landlord's statement within forty five (45) days
after receipt of such statement. Unless Tenant shall, by notice to Landlord
within such one hundred and twenty (120) day period, take exception to any item
in such statement, the statement shall be conclusively binding and shall not be
contestable by Tenant. Tenant's review may include the employment of an
accounting selected by Tenant and reasonably approved by Landlord. The expense
of the aforesaid firm shall be borne by Tenant, except that if by reason of such
exception Tenant has overpaid Additional Charges by more than three (3%) percent
for any Lease Year, then Landlord shall pay its own expenses and the expense of
said firm for said review. If errors are discovered in the Landlord's
accounting, an adjustment to the Additional Charges shall be made. In addition,
Tenant shall pay Landlord at cost for copies actually made by Landlord during
such review. Tenant acknowledges that Landlord's books and records are
confidential and proprietary in nature and that Landlord could be damaged if
such books and records became public. Therefore, Tenant agrees to keep such
books and records in strict confidence and not to publish or disseminate the
same or any information therein without

                                       43     Real Estate/Newport Beach Lease(3)

<PAGE>

Landlord's prior approval, except to Tenant's lawyers or accountants or in
connection with legal proceedings.

5.   Tenant's Right to Expand

Provided that Tenant is not in material default (after the expiration of all
applicable notice and cure periods) under the Lease and with not less than nine
(9) months prior written notice before the 5th and/or 10th year anniversary
date(s) of the Lease ("Tenant's Expansion Notice"), Tenant shall have two
separate options to expand within the Building. Each separate option, if
exercised by Tenant, shall be delivered not sooner than six (6) months before
or, not later than six (6) months after the applicable 5th or 10th year
Commencement Date. The size of each space shall be not less than 9,500 rentable
square feet or, not greater than 10,500 rentable square feet. Rent shall
commence 3 months after Landlord has delivered the expansion space(s) to Tenant.
If either or both options are exercised by Tenant, the Total Monthly Rent shall
each be determined based on the 5th and 10th year anniversary timeframe(s) at
95% of FMR as defined above.

     (a)  Within thirty (30) days after Landlord receives Tenant's Expansion
          Notice, Landlord shall determine (i) the specific floor of the
          Expansion Space and the location of the Expansion Space on such floor,
          (ii) the precise Net Rentable Area, and (iii) the expected delivery
          date for the Expansion Space. Landlord will notify Tenant of such
          determination within such thirty (30) day period (Landlord's Notice").
          Landlord shall deliver to Tenant the Expansion Space on the expected
          delivery date set forth in Landlord's Notice.

     (b)  Tenant shall have ten (10) business days to accept the conditions as
          set forth in Landlord's Notice " (Tenant's Acceptance Notice") and if
          Tenant so accepts, the Expansion Space shall be added to and become
          part of the Premises for all purposes under the terms and conditions
          of this Lease as of the date the Expansion Space is delivered to
          Tenant, except as follows:

          (i)  The Lease term for the Expansion Space shall expire
               simultaneously with the expiration or earlier termination of the
               Term of the Lease.

          (ii) Tenant shall pay Total Monthly Rent for the Expansion Space
               commencing on the date that is three months after the Expansion
               Space is delivered to Tenant in the condition required herein,
               equal to the Base Rent then being paid by Tenant (on a rentable
               square foot basis) under the Lease for the Premises. Base Rent
               for the Expansion Space shall escalate at the same time and in
               the same amount (on a rentable square foot basis) as the Base
               Rent payable under the Lease. Tenant's proportional share shall
               be adjusted accordingly.

     (c)  The Expansion Space shall be delivered to Tenant in broom clean
          condition with all personal property removed therefrom.

     (d)  Landlord and Tenant shall enter into an amendment to the Lease
          reflecting expansion of the Premises upon the terms provided for
          herein, which amendment shall be executed within sixty (60) days after
          Tenant's Acceptance Notice.

     (e)  In the event Tenant does not accept Landlord's Notice, said option to
          expand shall expire with no effect on subsequent expansion options, if
          available, as provided herein.

6.   Exclusive Use.

Landlord covenants not to enter into a lease agreement or any other occupancy
agreement after the date this Lease is signed by Landlord and Tenant
(collectively, an "Occupancy Agreement") for space in the Building with any of
the entities listed on Exhibit G attached hereto and made a part hereof or any
entity

                                       44     Real Estate/Newport Beach Lease(3)

<PAGE>

controlled by or owning a controlling interest in any of these entities
(collectively, the "Competitors") for a term scheduled to commence during the
Term or any extension or renewal thereof. During the Term, Tenant shall have the
right to add to the list of Competitors up to three (3) entities whose primary
business is the business of providing human capital management consulting
services (including, without limitation, human rights and benefits outsourcing)
(collectively the "Competing Use"). In addition, no more than once every three
years during the Term, Tenant shall have the right to modify the list of the
three Competitors added to the list in accordance with the preceding sentence,
by replacing any of such three (3) Competitors with an entity that engages in
the Competing Use. Furthermore, no more than once a year during the Term, in the
event one of the Competitors creates or "spins off" a more specialized
consulting entity that engages in the Competing Use, Tenant shall have the right
to replace such single Competitor with the more specialized related consulting
entity.

                                       45     Real Estate/Newport Beach Lease(3)

<PAGE>

                                    EXHIBIT G

                 LIST OF COMPETITORS EXCLUDED FROM THE BUILDING

Fidelity Investments
The Hay Group
Mercer Consulting
The Wyatt Corporation
Towers Perrin Incorporated (or any of its subsideries)
Accenture
Anderson Consulting
KPMG Consulting
Price Waterhouse Coopers
Ernst & Young
Hazelhurst & Associates, Inc.
Kwasha Lipton, Inc.
Buck Consultants
Alexander and Alexander, Inc.
AON
Exult

                                       46     Real Estate/Newport Beach Lease(3)

<PAGE>

                                    EXHIBIT H

                          TENANT'S ESTOPPEL CERTIFICATE

      The undersigned, as Tenant, under that certain Office Lease (the "Lease")
dated as of _____________, 2002 made with _____________________________________,
as Landlord, hereby certifies as follows (all initially capitalized terms or
phrases used herein shall have the same meanings as in the Lease):

 1.   The undersigned entered into occupancy of the Premises described in the
      Lease on ____________________, 2002;

 2.   The undersigned opened for business in the Premises on __________________,
      2002;

 3.   The Lease (including all Exhibits) is in full force and effect and has not
      been assigned, modified, supplemented or amended in any way, except as
      follows:

 4.   The Lease, as affected by those changes set forth in Paragraph 3 above,
      represents the entire agreement between the parties as to the Premises;

 5.   The Commencement Date under the Lease was _______________________________;

 6.   The term of the Lease will expire on ________________________________;

 7.   All conditions of the Lease to be performed by Landlord and necessary to
      the enforceability of the Lease have been satisfied;

 8.   There are no uncured defaults by Landlord under the Lease and Tenant knows
      of no events or conditions which with the passage of time or notice or
      both, would constitute a default by Landlord under the Lease, except as
      follows:

 9.   No rents have been prepaid, other than for the current month and as
      expressly provided in the Lease;

10.   At the date hereof, the undersigned has no existing defenses against or
      offsets of Basic Annual Rent or Additional Rent or the enforcement of the
      Lease by Landlord; and

11.   The total amount of security deposit delivered to Landlord is $__________,
      and none of that amount has, to Tenant's knowledge, been applied by
      Landlord to cure any default by Tenant; and

12.   The current monthly installment of Basic Annual Rent (including all
      adjustments pursuant to the terms of the Lease) is $___________ , and has
      been paid through ______________________, 200_.

      EXECUTED this ___________ day of _________________________, 200_.

                                       Hewitt Associates LLC
                                       an Illinois limited liability company

                                       By: C. L. Connolly, II
                                       Its: Principal

                                       47     Real Estate/Newport Beach Lease(3)

<PAGE>

                                    EXHIBIT I

                                DEMISED PREMISES

                     (Commencement Date - October 31, 2002)

                                       48     Real Estate/Newport Beach Lease(3)

<PAGE>

                                    EXHIBIT J

                                DEMISED PREMISES

                        (November 1, 2002 and thereafter)

                                       49     Real Estate/Newport Beach Lease(3)

<PAGE>

                   SUBORDINATION, NONDISTURBANCE, RECOGNITION
                            AND ATTORNMENT AGREEMENT

     THIS SUBORDINATION, NONDISTURBANCE, RECOGNITION AND ATTORNMENT AGREEMENT
("Agreement") made as of the _____ day of ___________, _______ by and between
____________________________, having an office at _____________ ("Lender"), and
____________________________ having an office at ________________________
("Tenant").

                                   WITNESSETH

     WHEREAS, _______________________ ("Landlord"), is the owner of certain real
property, together with the building and other improvements located thereon
(collectively, the "Mortgaged Property") located at ____________________________
and more particularly described on Exhibit A annexed hereto and by this
reference made a part hereof; and

     WHEREAS, Lender is the mortgagee under that certain Mortgage (as
hereinafter defined), which encumbers the Mortgaged Property; and

     WHEREAS, Landlord and Tenant have entered into a lease dated as of ________
____________________ demising a portion of the Mortgaged Property (as the same
may be amended or supplemented from time to time with the prior written consent
of Lender if required herein, the "Lease"). Capitalized terms used herein and
not defined shall have the meanings given to them in the Lease; and

     WHEREAS, Lender and Tenant wish to enter into this Agreement (i) to confirm
the subordination of the Lease to the lien of the Mortgage, (ii) to provide that
Tenant's possession of the Demised Premises (as hereinafter defined) will not be
disturbed in the event of foreclosure, (iii) to provide that Tenant will attorn
to the Purchaser (as hereinafter defined) and the Purchaser will recognize
Tenant and (iv) to provide for certain other matters;

     NOW, THEREFORE, in consideration of the premises and the execution of this
Agreement by the parties, Lender and Tenant hereby agree as follows:

1.   Definitions.

     For the purposes of this Agreement, the following terms shall have the
following meanings:

     (a)  Demised Premises: The portion of the Mortgage Property now or
          hereafter demised under the Lease.

     (b)  Mortgage: That certain mortgage dated as of _______________, and
          recorded _________________ in the __________________ County Recorder's
          Office, Document Number ________________.

     (c)  Person: And individual, partnership, corporation, business trust,
          joint stock company, trust, unincorporated association, joint venture,
          governmental authority or other entity of whatever nature.

<PAGE>

     (d)  Purchaser: Any Person acquiring the Mortgaged Property (i) in any
          foreclosure or any action or proceeding (judicial or nonjudicial)
          instituted under or in connection with the Mortgage, (ii) by delivery
          of a deed or assignment given in lieu of foreclosure, or (iii) by
          order of the United States Bankruptcy Court, and, with respect to (i),
          (ii) and (iii), such Person's successors and assigns.

2.   Consent.

     Lender hereby consents to the execution and delivery of the Lease by
Landlord and all of the terms and conditions thereof. Lender acknowledges and
agrees that the terms of the Mortgage shall not affect such terms and conditions
of the Lease, including without limitation, the specific provisions of the Lease
governing assignments, subletting, self-help rights, alterations, repairs,
contesting requirements of law, extending the term of the Lease and expanding
the Demised Premises to include certain portions of the Building that may be
become available for leasing from time to time, as all such provisions are more
particularly set forth in the Lease.

3.   Subordination.

     The Lease and Tenant's interest thereunder is now and at all times shall
continue to be subject and subordinate in each and every respect (except as
otherwise expressly provided in this Agreement) to the lien of the mortgage and
to any and all increases, renewals, amendments, modifications, supplements,
extensions, consolidations and replacements of the Mortgage, including, without
limitation, amendments which increase the amount of the indebtedness secured
thereby.

4.   Nondisturbance.

     So long as there exists no default under the Lease that (i) continues
beyond the expiration of any applicable notice and grace period and (ii) would
permit Landlord to terminate the Lease, (a) Purchaser shall not terminate the
Lease nor shall Purchaser seek to remove or evict Tenant from the Demised
Premises nor shall Purchaser disturb or affect Tenant's (or, with respect to any
Person known to Purchaser to be claiming through or under Tenant, such Person's)
leasehold estate, use and possession of the Demised Premises in accordance with
the terms of the Lease or any rights of Tenant (and any Person known to
Purchaser to be claiming through or under Tenant) under the Lease by reason of
the subordination of the Lease to the Mortgage or any modifications of or
default under the Mortgage or in any foreclosure action or any other action or
proceeding instituted under or in connection with the Mortgage, unless such
right would have independently existed if the Mortgage had not been made and (b)
neither Tenant nor any person known to Lender to be claiming through or under
Tenant shall be named or joined in any foreclosure action or other proceeding
to enforce the Mortgage unless such joinder shall be required by law, provided
that such joinder shall not result in the termination of the Lease or disturb
the possession or use of the Demised Premises by Tenant or any person known to
Lender to be claiming through or under Tenant.

5.   Attornment and Recognition.

     (a)  If the interests of Landlord under the Lease shall be transferred to a
          Purchaser, (X) Tenant shall be bound to the Purchaser under all of the
          then executory terms,

                                       2

<PAGE>

          covenants and conditions of the Lease for the balance of the term
          thereof remaining and any extensions or renewals thereof which may be
          effected by Tenant in accordance with any option therefor in the
          Lease, with the same force and effect as if the Purchaser were the
          landlord under the Lease, (y) Purchaser shall recognize the rights of
          Tenant under the Lease including, without limitation, any self-help
          rights, any options relating to renewal, expansion, contraction and
          the right to purchase the Mortgage Property, and any rights of
          termination specifically set forth in the Lease and (z) the Lease
          shall continue in full force as a direct lease between Tenant and
          Purchaser and the respective executory rights and obligations of
          Tenant and Purchaser (as landlord under the Lease), to the extent of
          the then remaining balance of the term of the Lease and any such
          extensions and renewals, shall be and are the same as set forth
          therein; provided that, except as otherwise provided in Section 5(b)
          and Section 5(c) below, Purchaser (so long as Purchaser is not an
          affiliate of Landlord) shall not be:

          (i)   liable for any act or omission of or default by Landlord or any
                prior landlord under the Lease;

          (ii)  subject to any credits, claims, setoffs or defenses which Tenant
                might have against Landlord or any prior landlord as a result of
                any acts or omissions of Landlord or any prior landlord;

          (iii) subject to clause (vi) below, bound by any fixed rent, basic
                rent, additional rent or other amounts which Tenant may have
                paid to Landlord more than thirty days in advance of the month
                to which such payments relate, and all such prepaid rent and
                additional rent shall remain due and owing without regard to
                such prepayment, except for prepayments of additional rent made
                on account of operating expenses and real estate taxes in
                accordance with the terms of the Lease;

          (iv)  bound by any amendment, modification or cancellation of the
                Lease or surrender of the Demised Premises made without Lender's
                or Purchaser's prior written consent, except for (a) any
                amendment or modification specifically contemplated by the terms
                of the Lease, including, without limitation, amendments or
                modifications entered into in connection with Tenant's expansion
                and contraction rights; and (b) any amendment or modification
                that is of an administrative nature relating to the ordinary
                course of operation of the Building that does not purport to be
                amendments or modifications of the Lease and do not materially
                adversely affect the rights of Landlord, Lender or Purchaser
                provided that Tenant and/or Landlord shall have given Lender or
                Purchaser at least ten business days prior notice thereof;

          (v)   responsible for the making of repairs in or to the mortgaged
                Property in the case of damage or destruction of the Mortgaged
                Property or any part thereof due to fire or other casualty
                occurring prior to the date on which Purchaser acquires title to
                the Mortgaged Property (or the date, if such date shall occur
                prior to the foregoing date, on which Lender shall elect to
                become a mortgagee-in-possession) or by reason of a condemnation

                                       3

<PAGE>

                occurring prior to the date on which Purchaser acquires title to
                the Mortgaged Property (or the date, if such date shall occur
                prior to the foregoing date, on which Lender shall elect to
                become a mortgagee-in-possession) unless Landlord shall be
                obligated under the Lease to make such repairs in which event
                Purchaser shall make such repairs but only to the extent that
                Purchaser shall have received insurance proceeds or cash
                condemnation awards sufficient (when aggregated with, in the
                case of damage or destruction, an amount equal to the applicable
                insurance deductible) to finance such repairs; or

          (vi)  obligated to make any payment to Tenant required to be made by
                Landlord prior to the date on which the interests of Landlord
                under the Lease are transferred to Purchaser (or the date, if
                such date shall occur prior to the foregoing date, on which
                Lender shall elect to become a mortgagee-in-possession) except
                for (x) the timely return of any security deposit actually
                received by Purchaser and (y) the credit or refund to Tenant as
                provided in the Lease of any prepayment of rent or other charges
                paid by Tenant if such prepayment is actually received by
                Purchaser.

     (b)  Nothing contained in clauses (i) or (ii) of Section 5(a) above shall
          relieve the Purchaser from any liability for its own failure to
          perform the obligations of the landlord under the Lease to the extent
          such obligations accrue during or are otherwise applicable to the
          period after the date that the Purchaser obtains title to the
          Mortgaged Property (or the date, if such date shall occur prior to the
          foregoing date, on which Lender shall elect to become a
          mortgagee-in-possession). Notwithstanding anything to the contrary
          contained in this Agreement (other than the next succeeding sentence
          hereof), the Purchaser (including the Lender if it be the Purchaser)
          shall be bound by all abatements of, and offsets or credits against,
          the rent payable under the Lease to which Tenant may be entitled under
          the terms of the Lease and shall recognize all of the rights of Tenant
          under the Lease regardless of whether any such abatement, offset,
          credit or other rights shall have accrued with respect to any period
          prior to the date that the Purchaser obtains title to the Mortgaged
          Property or shall elect to become a mortgage-in-possession.
          Notwithstanding anything to the contrary contained in this Agreement
          or the Lease, the liability of Lender and Purchaser, respectively,
          with respect to the Lease shall be further limited to Lender's and
          Purchaser's respective interests in the Mortgaged Property and Tenant
          shall not look to any other property or assets of Lender, Purchaser or
          any of the partners, shareholders, directors, officers or principals,
          direct or indirect, of Lender or Purchaser in seeking either to
          enforce Purchaser's (including Lender if it be the Purchaser)
          obligations under the Lease or to satisfy a judgment (including,
          without limitation, a judgment for specific performance) for
          Purchaser's (including Lender's if it be the Purchaser) failure to
          perform such obligations.

     (c)  Tenant hereby attorns to the Purchaser, including Lender if it be the
          Purchaser, as its landlord, upon the terms and conditions herein set
          forth, said attornment to be effective and self-operative upon
          Purchaser's succeeding to the interest of Landlord under the Lease
          without the execution of any further instruments.

                                        4

<PAGE>

      (d) Notwithstanding anything to the contrary contained herein, in the
          event of (1) any act, omission, default, misrepresentation, or breach
          of warranty of any previous landlord (including Landlord), which would
          result in liability of such previous landlord, or (2) any event or
          circumstance which subjects a previous landlord to any offset,
          defense, claim or counterclaim (a "Liability Event") and the event or
          circumstance which gave rise to such Liability Event continues to
          exist after actual ownership and possession of the Mortgaged Property
          (a "Carryover Liability Event") by Purchaser, including Lender if it
          be the Purchaser (the "Transition Date"), Purchaser shall nonetheless
          be liable as landlord under the Lease for the obligations accruing
          with respect to any such Carryover Liability Event after the
          Transition Date.

6.    Covenants of Tenant.

      (a) Tenant agrees for the benefit of Lender that, so long as the Mortgage
          remains a lien upon the Mortgaged Property, Tenant will not:

          (i)   pay any rent more than 30 days in advance of accrual, except for
                prepayments of additional rent made on account of operating
                expenses and real estate taxes in accordance with the terms of
                the Lease;

          (ii)  surrender the Tenant's estate under the Lease, other than by
                exercise of Tenant's express rights under the Lease;

          (iii) enter into any modification or amendment to the terms of the
                Lease except for (a) any amendment or modification specifically
                contemplated by the terms of the Lease, including, without
                limitation, amendments or modifications entered into in
                connection with Tenant's expansion and contraction rights; and
                (b) any amendment or modification that is of an administrative
                nature relating to the ordinary course of operation of the
                Building that does not purport to be amendments or modifications
                of the Lease and do not materially adversely affect the rights
                of Landlord, Lender or Purchaser provided that Tenant and/or
                Landlord shall have given Lender or Purchaser provided at least
                ten business days prior notice thereof. In the event that
                Tenant, without Lender's consent, enters into any modification
                or amendment of the Lease that is not of a type specified in
                clause (a) or (b) above, this Agreement will continue to be in
                full force and effect, except that neither Lender nor Purchaser
                shall be bound by such amendment or modification; or

          (iv)  expressly consent to termination of the Lease by the Landlord
                thereunder other than a termination by the Landlord pursuant to
                the express provisions of the Lease.

      (b) If any act or omission of Landlord would give Tenant the right,
          immediately or after notice or lapse of a period of the time or both,
          to cancel or terminate the Lease or to claim a partial or total
          eviction or constructive eviction, Tenant shall give written notice of
          such act or omission to Lender simultaneously with the giving of

                                       5

<PAGE>

          any notice thereof to Landlord as required under the Lease and Tenant
          shall not exercise such right until:

          (i)   Tenant has given written notice of such act or omission to
                Landlord and, concurrently therewith, to Lender; and

          (ii)  Landlord shall have failed to cure the same within the time
                limits set forth in the Lease; and

          (iii) Lender or the Purchaser (if the Purchaser is not Lender) shall
                have failed to remedy such act or omission within the cure
                period available to Landlord under the Lease plus 15 days.

7.   Payment to Lender.

     After notice is given to Tenant by Lender that, pursuant to the Mortgage,
the rentals under the Lease should be paid to Lender, Tenant shall pay to
Lender, or in accordance with the written directions of Lender, all rentals and
other monies then due and to become due to Landlord under the Lease, and
Landlord hereby expressly authorizes Tenant to make such payments to Lender and
hereby fully releases and discharges Tenant of, and from any liability to
Landlord on account of any such payments.

8.   Representations and Warranties.

     Tenant represents to Lender that:

     (a)  The Lease is full force and effect and has not been modified (except
          as may be set forth herein).

     (b)  No rent has been paid under the Lease more than 30 days in advance of
          accrual.

     (c)  The address of the Tenant for notices under the Lease is as follows:

          (i)  at ________________________________, Attention: _________________
               _______________; and (ii) WITH COPIES to ________________________
               _______________, Attention: ____________________.

9.   Successors and Assigns.

     This Agreement shall inure to the benefit of and shall be binding upon
Tenant, Landlord and Lender and any Purchaser, and their respective heirs,
personal representatives, successors and assigns and any modifications or
amendments of this Agreement must be in writing and executed by the party or
parties hereto intended to be bound thereby.

10.  Severability.

     If any of the terms of this Agreement, or the application thereof to any
person or circumstances, shall to any extent to invalid or unenforceable, the
remainder of this Agreement, or the application of any such terms to any person
or circumstances other than those as to which

                                       6

<PAGE>

it is invalid or unenforceable, shall not be affected thereby, and each term of
this agreement shall be valid and enforceable to the fullest extent permitted by
law.

11.  Choice of Law.

     This Agreement shall be governed by and construed in accordance with the
laws of the State of California without giving effect to any principles of
conflict of laws.

     IN WITNESS WHEREOF, the parties have executed the foregoing agreement as
of the day and year first hereinabove written.

                                               LENDER:

                                               _________________________________

                                               By:______________________________
                                               Name:____________________________
                                               Title:___________________________

                                               TENANT:

                                               _________________________________

                                               By:______________________________
                                               Name:____________________________
                                               Title:___________________________

As to Section 7 only:

LANDLORD:

___________________________

By:
Name:
Title:

                                       7

<PAGE>

                      FIRST AMENDMENT TO AGREEMENT OF LEASE

     This AGREEMENT is made and entered in to as of December 3, 2002 by Annod
Corp., not personally but solely as Trustee of The Bayview Trust, a trust
organized under the laws of Illinois, as "Landlord," and Hewitt Associates LLC,
an Illinois limited liability company as "Tenant."

     WHEREAS, Landlord and Tenant are parties to that certain Agreement of Lease
dated June 1, 2002 (the "Lease") for portions of the Premises (as defined in the
Lease) commonly known as 100 Bayview Circle, Newport Beach, California.

     WHEREAS, Landlord and Tenant wish to correct and amend certain terms of the
Lease as of the date hereof.

     NOW, THEREFORE, for and in consideration of the foregoing recitals, the sum
of $10.00 in hand paid, and other good and valuable consideration, the receipt
and sufficiency of which is hereby acknowledged Landlord and Tenant agree as
follows:

1.   Lease Preamble - Base Rent Monthly Installment. The dates contained in the
     second line of Section 7 of the Lease Preamble is hereby amended to read
     "Months 13-24" in lieu of "Months 2 - 24."

2.   Lease Preamble - Lower Level Storage. The number "4,428" in the first line
     of Section 8 of the Lease Preamble shall be struck and in its place "1,428"
     shall be inserted.

3.   Lease Preamble - Footnote 1. The word "Rent" in Footnote 1 of the Lease
     Preamble is hereby deleted and the following shall be inserted in lieu
     thereof: "Base Rent and Total Monthly Rent (as defined in Section 3(a) of
     the Lease)".

4.   Lease - Utilities and Services.

     The phrase "four (4)" in Section 8(d)(iv) is hereby deleted and "three (3)"
     shall be inserted in lieu thereof.

     With respect to Section 8(d)(v) : The second sentence is hereby deleted in
     its entirety. The word "manned" is hereby deleted in the third sentence.
     The word "Third" in the last sentence of this Section is hereby amended to
     read "Fourth". A new final sentence is hereby added to read as follows:
     "Tenant shall be responsible and shall reimburse Landlord for costs
     relating to maintenance and repair of such exclusive service elevator."

     The following sentence shall be added to the end of Section 8(g): "Tenant
     shall provide Landlord with at least ten (10) business days notice of its
     decision to cancel Landlord's janitorial services."

5.   Exhibit E - Operating and Capital Expense - Exclusions. In Section (a) the
     phrase "or Landlord's property manager" is hereby struck.

6.   Exhibit F Tenant's Options. Section 5 entitled "Tenant's Right to Expand"
     shall be modified as follows:

<PAGE>

     a.   The last sentence of the first paragraph of this Section shall be
          deleted.
     b.   Subsection (b)(ii) is hereby deleted in its entirety and the following
          shall be inserted in lieu thereof: "Tenant shall pay Total Monthly
          Rent for the Expansion Space commencing on the date that is three
          months after the Expansion Space is delivered to Tenant in the
          condition required herein. The Total Monthly Rent shall be determined
          based on the 5th and 10th year anniversary timeframe(s) at 95% of FMR
          as defined above."

     Except as provided herein, all other terms and provisions of the Lease, as
amended by this First Amendment, shall remain unmodified and in full force and
effect.

Landlord:                               Tenant:
Annod Corp., not personally but         Hewitt Associates LLC,
solely as trustee of                    an Illinois limited as
The Bayview Trust                       liability company

By: ___________________________         By: ___________________________
Name: C. L. Connolly, III               Name: Dale L. Gifford
Its: President                          Its: CEO and Authorized Representative

                                       2<PAGE>
                                                                     EXHIBIT 4.1

                           THOMAS & BETTS CORPORATION

                                       AND

                              THE BANK OF NEW YORK,

                                   as Trustee

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

                             Supplemental Indenture
                                      No. 2

                            Dated as of May 27, 2003

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

                              7.25% Notes due 2013

<PAGE>

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                             PAGE
                                                                                             ----
                                    ARTICLE 1
       RELATION TO THE BASE INDENTURE; DEFINITIONS AND OTHER PROVISIONS OF
                              GENERAL APPLICATION

<S>                                                                                          <C>
Section 1.01.  Relation to the Base Indenture...................................................1
Section 1.02.  Definitions and Other Provisions of General Application..........................1
Section 1.03.  Other Definitions...............................................................17

                                    ARTICLE 2
                               THE SERIES OF NOTES

Section 2.01.  Title...........................................................................17
Section 2.02.  Principal Amount................................................................18
Section 2.03.  Form of Notes...................................................................18
Section 2.04.  Denomination and Date of Securities; Payment of Interest........................18
Section 2.05.  Depository......................................................................18

                                    ARTICLE 3
                                   REDEMPTION

Section 3.01.  Optional Redemption.............................................................18

                                    ARTICLE 4
                                EVENTS OF DEFAULT

Section 4.01.  Additional Events of Default Applicable to the Notes............................19

                                    ARTICLE 5
                                    COVENANTS

Section 5.01.  Reports.........................................................................20
Section 5.02.  Limitations upon Liens..........................................................20
Section 5.03.  Limitations on Additional Indebtedness and Subsidiary Preferred Stock...........22
Section 5.04.  Limitations on Restricted Payments..............................................25
Section 5.05.  Limitations on Restrictions on Distributions from Subsidiaries..................26
Section 5.06.  Limitations on Asset Sales......................................................28
Section 5.07.  Repurchase of Notes upon a Change of Control Prior to the Fall-Away Event.......32
Section 5.08.  Limitations upon Sales and Leasebacks...........................................34
Section 5.09.  Restrictions on Funded Debt of Restricted Subsidiaries..........................34
</TABLE>

                                       1

<PAGE>

<TABLE>

                                    ARTICLE 6
              CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
<S>                                                                                            <C>
Section 6.01.  Consolidation, Merger, Sale of Assets, Etc. Prior to Fall-Away Event............35

                                    ARTICLE 7
                       MODIFICATION, AMENDMENT AND WAIVER

Section 7.01.  Modification, Amendment and Waiver..............................................36

                                    ARTICLE 8
                                   DEFEASANCE

Section 8.01.  Defeasance......................................................................36
Section 8.02.  Covenant Defeasance.............................................................36
Section 8.03.  Additional Covenant Defeasance..................................................36

                                    ARTICLE 9
                                  MISCELLANEOUS

Section 9.01.  Supplemental Indenture..........................................................36
Section 9.02.  Counterparts....................................................................36
Section 9.03.  Governing Law...................................................................37
</TABLE>

                                       2

<PAGE>

         SUPPLEMENTAL INDENTURE NO. 2 dated as of May 27, 2003 between Thomas &
Betts Corporation, a Tennessee corporation (the "COMPANY") and The Bank of New
York, a New York banking corporation, as Trustee (the "TRUSTEE").

                             RECITALS OF THE COMPANY

         The Company and the Trustee have executed and delivered an Indenture
dated as of August 1, 1998 (the "BASE INDENTURE" and, as supplemented by this
Supplemental Indenture No. 2, the "INDENTURE") to provide for the issuance from
time to time of the Company's Securities.

         Sections 2.01 and 3.01 of the Base Indenture provide that the form and
terms of Securities of any series may be established pursuant to an indenture
supplemental to the Base Indenture.

         All things necessary to make the Securities, when executed by the
Company and authenticated and delivered hereunder and under the Base Indenture
and duly issued by the Company and to make this Supplemental Indenture No. 2 a
valid agreement of the Company, in accordance with their and its terms, have
been done.

         NOW, THEREFORE, this Supplemental Indenture No. 2 WITNESSETH:

         For and in consideration of the premises and the purchase of the
Securities by the Holders thereof, it is mutually covenanted and agreed, for the
equal and proportionate benefit of the Holders of the Securities of the series
hereby established, as follows:

                                   ARTICLE 1
       RELATION TO THE BASE INDENTURE; DEFINITIONS AND OTHER PROVISIONS OF
                              GENERAL APPLICATION

         Section 1.01 Relation to the Base Indenture. This Supplemental
Indenture constitutes an integral part of the Base Indenture.

         Section 1.02 Definitions and Other Provisions of General Application.
For all purposes of this Supplemental Indenture unless otherwise specified
herein:

         (a) all terms used in this Supplemental Indenture which are not
otherwise defined herein shall have the meanings they are given in the Base
Indenture;

         (b) the provisions of general application stated in Section 1.01 of the
Base Indenture shall apply to this Supplemental Indenture, except that the words
"HEREIN," "HEREOF," "HERETO" and "HEREUNDER" and other words of similar import

<PAGE>

refer to this Supplemental Indenture as a whole and not to the Base Indenture or
any particular Article, Section or other subdivision of the Base Indenture or
this Supplemental Indenture;

         (c) Section 1.01 of the Base Indenture is amended by inserting the
following additional defined terms in their appropriate alphabetical positions:

         "ACCOUNTS RECEIVABLE" of any Person means any and all accounts,
contract rights, chattel paper, instruments, documents, general intangibles and
other obligations of any kind relating to the sale or lease of goods and the
rendering of services by such Person, all rights relating thereto, all deposit
accounts containing the proceeds thereof, all books and records relating thereto
and the proceeds thereof.

         "ACQUIRED INDEBTEDNESS" means (i) with respect to any Person that
becomes a Subsidiary of the Company after the Original Issue Date of the Notes,
Indebtedness of such Person and its Subsidiaries existing at the time such
Person becomes a Subsidiary of the Company and (ii) with respect to the Company
or any of its Subsidiaries, any Indebtedness assumed by the Company or any of
its Subsidiaries in connection with the acquisition of an asset from another
Person.

         "ASSET SALE" for any Person means the sale, lease, conveyance or other
disposition (including, without limitation, by merger or consolidation, and
whether by operation of law or otherwise) of any of such Person's assets
(including, without limitation, the sale or other disposition of Capital Stock
of any Subsidiary of such Person, whether by such Person or by such Subsidiary),
whether owned on the Original Issue Date of the Notes or subsequently acquired,
in one transaction or a series of related transactions, in which such Person or
its Subsidiaries sell, lease, convey or otherwise dispose of:

                  (1) all or substantially all of the Capital Stock of any of
         such Person's Subsidiaries;

                  (2) assets that constitute all or substantially all of any
         division or line of business of such Person or any of its Subsidiaries;
         or

                  (3) any other assets of such Person or any of its
         Subsidiaries, other than in the ordinary course of business, provided
         that the Fair Market Value of the assets is at least $10,000,000;

         provided, however, that the following will not constitute Asset Sales:

                  (i) transactions between the Company and any of its Wholly
         Owned Subsidiaries or among the Company's Wholly Owned Subsidiaries;

                                       2

<PAGE>

                  (ii) any transaction not prohibited by Section 5.04 hereof or
         that constitutes a Permitted Investment;

                  (iii) any transfer of assets (including Capital Stock) that is
         governed by and in accordance with Article 8 of the Base Indenture and
         Section 6.01 hereof or the creation of any Lien not prohibited by
         Section 5.02 hereof;

                  (iv) the sale or lease of equipment, inventory, accounts
         receivable or other assets in the ordinary course of business;

                  (v) sales of damaged, worn-out or obsolete equipment or assets
         that, in the Company's reasonable judgment, are no longer either used
         or useful in the business of the Company or its Subsidiaries;

                  (vi) the sale at any time, but not more than one such
         transaction, of Voting Stock in a Person (other than a Subsidiary of
         the Company); or

                  (vii) one or more transactions during any twelve-month period
         with an aggregate Fair Market Value of less than $25,000,000,
         determined without regard to whether such transactions are related, but
         excluding sales of Capital Stock of the Company's Subsidiaries.

         "ATTRIBUTABLE DEBT" means, as to any particular lease under which any
Person is at the time liable for a term of more than 12 months, at any date as
of which the amount thereof is to be determined, the total net amount of rent
required to be paid by such Person under such lease during the remaining term of
such lease (excluding any subsequent renewal or other extension options held by
the lessee), discounted from the respective due dates of the rental payments to
such date at the interest rate inherent in such lease (the discount rate to be
determined by any two of the following: the President, any Vice President, the
Treasurer and the Controller of the Company), compounded annually. The net
amount of rent required to be paid under any such lease for any such period
should be the aggregate amount of the rent payable by the lessee with respect to
such period after excluding amounts required to be paid on account of
maintenance and repairs, services, insurance, taxes, assessments, water rates
and similar charges and contingent rents (such as those based on sales). In the
case of any lease which is terminable by the lessee upon the payment of a
penalty, such net amount of rent should include the lesser of (i) the total
discounted net amount of rent required to be paid from the later of the first
date upon which such lease may be so terminated or the date of the determination
of such amount of rent, as the case may be, and (ii) the amount of such penalty
(in which event no rent shall be considered as required to be paid under such
lease subsequent to the first date upon which it may be so terminated).

         "CAPITAL LEASE OBLIGATIONS" of any Person means the obligation of such
Person to pay rent or other amounts under a lease that is required to be
capitalized

                                       3

<PAGE>

for financial reporting purposes in accordance with GAAP, and the amount of such
obligation will be the capitalized amount of such obligation determined in
accordance with GAAP.

         "CAPITAL STOCK" of any Person means any and all shares, rights to
purchase, warrants or options (whether or not currently exercisable),
participation or other equivalents of or interest in (however designated) the
equity (including without limitation common stock, Preferred Stock and
partnership, joint venture and limited liability company interests) of such
Person (excluding any debt securities that are convertible into, or exchangeable
for, such equity).

         "CHANGE OF CONTROL" means the following:

                  (i) a third Person, including a "GROUP" as such term is used
         in Section 13(d)(3) of the Securities Exchange Act of 1934, becomes the
         beneficial owner, directly or indirectly, of 50.0% or more of the
         combined voting power of the Company's outstanding voting securities
         ordinarily having the right to vote for the election of the Company's
         directors; or

                  (ii) individuals who, as of May 21, 2003, constitute the board
         of directors of the Company (the "BOARD" generally and, as of May 21,
         2003, the "INCUMBENT BOARD") cease for any reason to constitute at
         least a majority of the board, provided that any Person becoming a
         director subsequent to May 21, 2003 whose election, or nomination for
         election by the Company's shareholders, was approved by a vote of at
         least three-quarters of the directors comprising the incumbent board
         (other than an election or nomination of an individual whose initial
         assumption of office is in connection with an actual or threatened
         election contest relating to the election of the Company's directors,
         as such terms are used in Rule 14a-11 of Regulation 14A promulgated
         under the Securities Exchange Act of 1934) will be considered as though
         such Person were a member of the incumbent board; or

                  (iii) the consummation of (A) any consolidation, share
         exchange, merger or amalgamation of the Company as a result of which
         the individuals and entities who were the respective beneficial owners
         of the Company's outstanding common stock and its voting securities
         immediately prior to such consolidation, share exchange, merger or
         amalgamation do not beneficially own, immediately after such
         consolidation, share exchange, merger or amalgamation, directly or
         indirectly, more than 50%, respectively, of the common stock and
         combined voting power of the voting securities entitled to vote of the
         company resulting from such consolidation, share exchange, merger or
         amalgamation or (B) any sale, lease, exchange or other transfer (in one
         transaction or a series of related transactions) of all or
         substantially all the assets or earning power of the Company; or

                                       4

<PAGE>

                  (iv) the approval by the shareholders of a plan of complete
         liquidation or dissolution of the Company.

         "CONSOLIDATED AMORTIZATION EXPENSE" of any Person for any period means
the amortization expense of such Person and its Subsidiaries for such period (to
the extent included in the computation of Consolidated Net Income of such
Person), determined on a consolidated basis in accordance with GAAP.

         "CONSOLIDATED CASH FLOW" of any Person means, with respect to any
determination date, Consolidated Net Income, plus (i) Consolidated Income Tax
Expense, plus (ii) Consolidated Depreciation Expense, plus (iii) Consolidated
Amortization Expense, plus (iv) Consolidated Interest Expense, plus (v) all
other unusual non-cash items or non-recurring non-cash items reducing
Consolidated Net Income of such Person and its Subsidiaries, determined on a
consolidated basis in accordance with GAAP, to the extent applicable, and less
all non-cash items increasing Consolidated Net Income of such Person and its
Subsidiaries, determined on a consolidated basis in accordance with GAAP, to the
extent applicable, in each case, for such Person's prior four full fiscal
quarters for which financial results have been reported immediately preceding
the determination date.

         "CONSOLIDATED DEPRECIATION EXPENSE" of any Person means the
depreciation expense of such Person and its Subsidiaries for such period (to the
extent included in the computation of Consolidated Net Income of such Person),
determined on a consolidated basis in accordance with GAAP.

         "CONSOLIDATED INCOME TAX EXPENSE" means, for any Person for any period,
the provision for taxes based on income and profits of such Person and its
Subsidiaries to the extent its provision for income taxes was deducted in
computing Consolidated Net Income of such Person for such period, determined on
a consolidated basis in accordance with GAAP.

         "CONSOLIDATED INTEREST EXPENSE" of any Person for any four-quarter
period means, without duplication, (i) the Interest Expense of such Person and
its Subsidiaries for such period, determined on a consolidated basis in
accordance with GAAP, plus (ii) (to the extent not otherwise included within the
definition of Interest Expense as imputed interest) one-third of the rental
expense on Attributable Debt of such Person for such period determined on a
consolidated basis, plus (iii) the Interest Expense on Indebtedness of another
Person that is guaranteed by such Person or any of its Subsidiaries or secured
by a Lien on assets of such Person or one of its Subsidiaries, whether or not
the guarantee or Lien is called upon, plus (iv) the dividend requirements of
such Person and its Subsidiaries with respect to Disqualified Stock and with
respect to all other Preferred Stock of Subsidiaries of such Person (in each
case whether in cash or otherwise (except dividends payable solely in shares of
Capital Stock (other than Disqualified Stock) of such Person or Subsidiary))
paid, accrued or accumulated during such period times a fraction the numerator
of which is one and the

                                       5

<PAGE>

denominator of which is one minus the then effective consolidated federal, state
and local tax rate of such Person, expressed as a decimal.

         "CONSOLIDATED INTEREST EXPENSE COVERAGE RATIO" with respect to any
four-quarter period means the ratio of (i) Consolidated Cash Flow of the Company
to (ii) the aggregate amount of Consolidated Interest Expense of the Company for
such period; provided, however, that if any calculation of the Company's
Consolidated Interest Expense Coverage Ratio requires the use of any quarter
prior to the Original Issue Date of the Notes, such calculation shall be made on
a pro forma basis, giving effect to the issuance of the Notes and the use of the
net proceeds from them as if the same had occurred at the beginning of the
four-quarter period used to make such calculation; and provided further that if
any such calculation requires the use of any quarter prior to the date that any
Asset Sale was consummated, or that any Indebtedness was incurred, or that any
acquisition of any assets purchased outside the ordinary course of business was
effected, by the Company or any of its Subsidiaries, such calculation shall be
made on a pro forma basis, giving effect to each such Asset Sale, incurrence of
Indebtedness or acquisition, as the case may be, and the use of any proceeds
therefrom, as if the same had occurred at the beginning of the four-quarter
period used to make such calculation.

         "CONSOLIDATED NET INCOME" of any Person for any period means the net
income (or loss) of such Person and its Subsidiaries for such period determined
on a consolidated basis in accordance with GAAP; provided that there will be
excluded from such net income (to the extent otherwise included in net income),
without duplication:

                  (i) the net income (or loss) of any Person (other than a
         Subsidiary of the referent Person) in which any Person other than the
         referent Person has an ownership interest, except to the extent that
         any of such income has actually been received by the referent Person or
         any of its Wholly Owned Subsidiaries in the form of dividends or
         similar distributions during such period;

                  (ii) except to the extent includible in the Consolidated Net
         Income of the referent Person pursuant to clause (i) above, the net
         income (or loss) of any Person that accrues prior to the date that (A)
         such Person becomes a Subsidiary of the referent Person or is merged
         into or consolidated with the referent Person or any of its
         Subsidiaries or (B) the assets of such Person are acquired by the
         referent Person or any of its Subsidiaries;

                  (iii) the net income of any Subsidiary of the referent Person
         (other than a Wholly Owned Subsidiary) to the extent that the
         declaration or payment of dividends or similar distributions by such
         Subsidiary of such income is not permitted by operation of the terms of
         its charter or any

                                       6

<PAGE>

         agreement, instrument, judgment, decree, order, statute, rule or
         governmental regulation applicable to such Subsidiary during such
         period;

                  (iv) any gain (or loss), together with any related provisions
         (or benefit) for taxes on any such gain (or loss), realized during such
         period by the referent Person or any of its Subsidiaries upon (A) the
         acquisition of any securities, or the extinguishment of any
         Indebtedness, of the referent Person or any of its Subsidiaries, (B)
         any Asset Sale by the referent Person or any of its Subsidiaries or (C)
         the payment of a settlement with the Commission during the year ended
         December 29, 2002;

                  (v) any extraordinary gain or extraordinary loss, together
         with any related provision for taxes or tax benefit resulting from any
         such extraordinary gain or extraordinary loss, realized by the referent
         Person or any of its Subsidiaries during such period; and

                  (vi) in the case of a successor to such Person by
         consolidation, merger or transfer of its assets, any earnings of the
         successor prior to such merger, consolidation or transfer of assets.

         "CONSOLIDATED NET TANGIBLE ASSETS" as of any date means the total
assets of the Company and its Subsidiaries (less applicable reserves and other
properly deductible items) after deducting from such amount (i) all current
liabilities (excluding any thereof that are by their terms extendible or
renewable at the option of the obligor thereon to a time more than 12 months
after the time as of which the amount thereof is computed), (ii) goodwill and
any other intangibles and (iii) appropriate adjustments on account of minority
interests of other Persons holding stock of the Company's Subsidiaries, all as
set forth on the most recent balance sheet of the Company and its Consolidated
Subsidiaries and prepared in accordance with GAAP on a consolidated basis at
such date.

         "CONSOLIDATED NET WORTH" of any Person as of any date means the
stockholders' equity (including any Preferred Stock that is classified as equity
under GAAP, other than Disqualified Stock) of such Person and its Subsidiaries
(excluding any equity adjustment for foreign currency translation for any period
subsequent to the Original Issue Date of the Notes) on a consolidated basis at
such date, as determined in accordance with GAAP, less all write-ups subsequent
to the Original Issue Date of the Notes in the book value of any asset owned by
such Person or any of its Subsidiaries.

         "CONSOLIDATED SUBSIDIARY" means, at any date, any Subsidiary or other
entity the accounts of which would be consolidated with those of the Company in
its consolidated financial statements if such statements were prepared as of
such date.

                                       7

<PAGE>

         "CREDIT AGREEMENT" means that certain Credit and Security Agreement
dated as of November 15, 2001, as amended or modified from time to time, among
the Company, as borrower, the lenders listed therein and Wachovia Bank, N.A., as
agent, including any related notes, letters or credit, guarantees, collateral
documents, instruments and agreements executed in connection therewith, provided
that the aggregate principal amount of Indebtedness outstanding thereunder shall
not at any time exceed $100,000,000.

         "CREDIT FACILITIES" means one or more credit facilities (including,
without limitation, the Credit Agreement) or commercial paper facilities, in
each case with banks or other institutional lenders providing for revolving
credit loans, term loans, receivables financing (including, without limitation,
through the sale of Accounts Receivables to such lenders or to special purpose
entities formed to borrow from such lenders against such Accounts Receivables
and under which the aggregate amount that may be issued or obtained is based
upon eligible Accounts Receivable or eligible Inventory) or letters of credit,
in each case as amended, modified, renewed, refunded, replaced or refinanced
from time to time, including any successor or replacements thereto, whether or
not with the same lender or lenders and whether or not the principal amount
thereof or amount of letters of credit outstanding thereunder or interest rate
payable in respect thereof shall be thereby increased.

         "DEBT" means any notes, bonds, debentures, or other similar evidences
of indebtedness for money borrowed.

         "DEFAULT" means any event, act or condition that is, or after notice or
the passage of time or both would be, an Event of Default.

         "DISQUALIFIED STOCK" means any Capital Stock that, by its terms (or by
the terms of any security into which it is convertible or for which it is
exchangeable), or upon the happening of any event, matures or is mandatorily
redeemable, pursuant to a sinking fund obligation or otherwise, or is redeemable
at the option of its holder, in whole or in part, on or prior to the Maturity
Date.

         "ELIGIBLE INVESTMENTS" of any Person means Investments of such Person
in:

                  (i) direct obligations of, or obligations the payment of which
         is guaranteed by, the United States of America or an interest in any
         trust or fund that invests solely in such obligations or repurchase
         agreements, properly secured, with respect to such obligations;

                  (ii) direct obligations of agencies or instrumentalities of
         the United States of America having a rating of A or higher by S&P or
         A2 or higher by Moody's;

                                       8

<PAGE>

                  (iii) a certificate of deposit issued by, or other
         interest-bearing deposits with, a bank having its principal place of
         business in the United States of America and having equity capital of
         not less than $250,000,000;

                  (iv) a certificate of deposit issued by, or other
         interest-bearing deposits with, any other bank organized under the laws
         of the United States of America or any U.S. state, provided that the
         deposit is either (A) insured by the Federal Deposit Insurance
         Corporation or (B) properly secured by the bank by pledging direct
         obligations of the United States of America having a market value of
         not less than the face amount of such deposits;

                  (v) prime commercial paper maturing within 270 days of the
         acquisition thereof and, at the time of acquisition, having a rating of
         A-1 or higher by S&P or P-1 or higher by Moody's; and

                  (vi) eligible banker's acceptances, repurchase agreements and
         tax-exempt municipal bonds having a maturity of less than one year, in
         each case having a rating of, or evidencing the full recourse
         obligation of a Person whose senior debt is rated, A or higher by S&P
         or A2 or higher by Moody's.

         "EQUITY OFFERING" means any primary offering by the Company of Capital
Stock of the Company (other than Disqualified Stock) for which cash
consideration is paid at the time of closing, other than sales to officers or
directors of the Company, any Subsidiary of the Company or any employee benefit
plan in which the Company or any Subsidiary of the Company participates.

         "EXISTING INDEBTEDNESS" means all of the Indebtedness of the Company
and its Subsidiaries that is outstanding on the Original Issue Date of the Notes
(other than pursuant to Credit Facilities).

         "FAIR MARKET VALUE" of any asset or items means the fair market value
of such asset or items as determined in good faith by the Company's board of
directors and evidenced by a Board Resolution.

         "FALL-AWAY EVENT" means that (i) the Notes are rated Investment Grade
for a continuous period of at least 30 calendar days, (ii) no Event of Default
or Default under the Indenture has occurred and is continuing and (iii) the
Company has delivered to the Trustee an Officer's Certificate certifying as to
the foregoing.

         "FUNDED DEBT" means Indebtedness created, assumed or guaranteed by a
Person for money borrowed which matures by its terms, or is renewable by the
borrower to a date, more than a year after the date of original creation,
assumption or guarantee.

                                       9

<PAGE>

         "GAAP" means generally accepted accounting principles in the United
States as in effect from time to time, applied on a basis consistent (except for
changes concurred in by the Company's independent public accountants) with the
most recent audited consolidated financial statements of the Company and its
Consolidated Subsidiaries.

         "HEDGING OBLIGATIONS" of any Person means the obligations of such
Person pursuant to any interest rate swap agreement, foreign currency exchange
agreement, interest rate collar agreement, option or futures contract or other
similar agreement or arrangement relating to interest rates or foreign exchange
rates (but shall not in any event include arrangements relating solely to
commodities).

         "INDEBTEDNESS" of any Person at any date means, without duplication:

                  (i) all indebtedness of such Person for borrowed money
         (whether or not the recourse of the lender is to the whole of the
         assets of such Person or only to a portion of such Person's assets);

                  (ii) all obligations of such Person evidenced by bonds,
         debentures, notes or other similar instruments;

                  (iii) all obligations of such Person in respect of letters of
         credit or other similar instruments (or reimbursement obligations with
         respect to them), other than obligations with respect to letters of
         credit securing obligations (other than obligations described in clause
         (i) above or clause (v) or (vi) below) entered into in the ordinary
         course of business of such Person to the extent such letters of credit
         are not drawn upon;

                  (iv) all obligations of such Person with respect to Hedging
         Obligations (other than those that are designed solely to protect such
         Person against fluctuations in interest rates in respect of
         Indebtedness otherwise permitted by the Indenture to the extent the
         notional principal amount of any such obligation does not exceed the
         aggregate principal amount of the Indebtedness to which such Hedging
         Obligation relates or that protect the Company or its Subsidiaries
         against changes in foreign exchange rates);

                  (v) all obligations of such Person to pay the deferred and
         unpaid purchase price of property or services, except trade payables
         and accrued expenses incurred in the ordinary course of business;

                  (vi) all Capital Lease Obligations of such Person;

                  (vii) all Indebtedness of others secured by a Lien on any
         asset of such Person, whether or not such Indebtedness is assumed by
         such Person;

                                       10

<PAGE>

                  (viii) all Indebtedness of others guaranteed by such Person to
         the extent of such guarantee; and

                  (ix) all Disqualified Stock of such Person and its
         Subsidiaries and all other Preferred Stock of Subsidiaries of such
         Person valued at the greater of (A) the voluntary or involuntary
         liquidation preference of such Disqualified Stock or such Preferred
         Stock, as the case may be, and (B) the aggregate amount payable upon
         purchase, redemption, defeasance or payment of such Disqualified Stock
         or such Preferred Stock, as the case may be.

         The amount of Indebtedness of any Person at any date shall be the
outstanding balance at such date of all unconditional obligations plus past due
interest as described above, the maximum liability of such Person for any of
those contingent obligations at such date and, in the case of clause (vii)
above, the amount of the Indebtedness secured.

         "INTEREST EXPENSE" of any Person for any period means the aggregate
amount of interest that, in accordance with GAAP, would be set opposite the
caption "interest expense" or any like caption on an income statement for such
Person (including, without limitation or duplication, imputed interest included
in Capital Lease Obligations, all commissions, discounts and other fees and
charges owed with respect to letters of credit and bankers' acceptance
financing, the net costs associated with Hedging Obligations, amortization of
financing fees and expenses, the interest portion of any deferred payment
obligation, amortization of discount and all other non-cash interest expense
other than interest amortized to cost of sales).

         "INVENTORY" of any Person means any and all inventory of any kind of
such Person, including without limitation any or all of the following:
inventory, merchandise, goods and other tangible personal property that are held
for sale or lease by such Person; all materials used or consumed in the business
of such Person, but excluding from the foregoing equipment of such Person.

         "INVESTMENT GRADE" means (i) a rating of BBB-- or above, in the case of
S&P (or its equivalent under any successor Rating Categories of S&P), and Baa3
or above, in the case of Moody's (or its equivalent under any successor Rating
Categories of Moody's), or (ii) the equivalent in respect of the Rating
Categories of any other Rating Agencies; provided, however, that if the rating
is BBB- in the case of S&P, or Baa3 in the case of Moody's (or the equivalent in
respect of the Rating Categories of any other Rating Agencies), then such rating
also must not be accompanied by a negative outlook, negative credit watch or
review for possible downgrade (or the equivalent thereof), as the case may be.

                                       11

<PAGE>

         "INVESTMENTS" of any Person means:

                  (i) all investments by such Person in any other Person in the
         form of loans, advances or capital contributions (excluding commission,
         travel and similar advances to officers and employees made in the
         ordinary course of business);

                  (ii) all guarantees of Indebtedness or other obligations of
         any other Person by such Person;

                  (iii) all purchases (or other acquisitions for consideration)
         by such Person of Indebtedness, Capital Stock or other securities of
         any other Person; and

                  (iv) all other items that would be classified as investments
         (including, without limitation, purchases of assets outside the
         ordinary course of business) on a balance sheet of such Person prepared
         in accordance with GAAP.

         "LIEN" means, with respect to any asset, any pledge, mortgage, charge,
encumbrance or security interest in respect of such asset; provided that any
transaction (including, without limitation, any sale of accounts receivable)
which is treated as a sale of assets under GAAP shall be so treated and any
asset which is so sold shall not be deemed subject to a Lien. Pursuant to the
Indenture, a contractual grant of a right of set-off does not create a Lien in
the absence of an agreement to maintain a balance against which such right may
be exercised.

         "MOODY'S" means Moody's Investors Service, Inc. and its successors.

         "NET PROCEEDS" with respect to any Asset Sale means (i) cash (in U.S.
dollars or freely convertible into U.S. dollars) received by the Company or any
of its Subsidiaries from such Asset Sale (including, without limitation, cash
received as consideration for the assumption or incurrence of liabilities
incurred in connection with or in anticipation of such Asset Sale), after (A)
provision for all income or other taxes measured by or resulting from such Asset
Sale or the transfer of the proceeds of such Asset Sale to the Company or any of
its Subsidiaries, (B) payment of all commissions and other fees and expenses
related to such Asset Sale and (C) deduction of an appropriate amount to be
provided by the Company or any of its Subsidiaries as a reserve, in accordance
with GAAP, against any liabilities associated with the assets sold or otherwise
disposed of in such Asset Sale and retained by the Company or any of its
Subsidiaries after such Asset Sale (including, without limitation, pension and
other post-employment benefit liabilities and liabilities related to
environmental matters) or against any indemnification obligations associated
with the sale or other disposition of the assets sold or otherwise disposed of
in such Asset Sale and (ii) all non-cash consideration received by the Company
or any of its Subsidiaries from those Asset Sales upon the liquidation or
conversion of the consideration into cash.

                                       12

<PAGE>

         "ORIGINAL ISSUE DATE" means May 27, 2003, the date the Notes were
initially issued.

         "PERMITTED INVESTMENTS" means:

                  (i) capital contributions, advances or loans to the Company by
         any of its Subsidiaries or by the Company or any of its Subsidiaries to
         a Subsidiary of the Company;

                  (ii) the acquisition and holding by the Company and any of its
         Subsidiaries of receivables owing to the Company and such Subsidiary,
         if created or acquired in the ordinary course of business and payable
         or dischargeable in accordance with customary trade terms;

                  (iii) the acquisition and holding by the Company and its
         Subsidiaries of cash and Eligible Investments;

                  (iv) Investments in any Person as a result of which such other
         Person becomes a Subsidiary of the Company or is merged into or
         consolidated with or transfers all or substantially all of its assets
         to the Company or any of its Subsidiaries;

                  (v) Investments in any Person (other than a Subsidiary of the
         Company) that, when added to the aggregate amount of all such other
         Investments made after the Original Issue Date of the Notes, do not
         exceed 2.5% of Consolidated Net Tangible Assets (with each such
         Investment being valued as of the date made and without regard to
         subsequent changes in value), provided that the Company or any
         Wholly-Owned Subsidiary of the Company owns at least 15.0% of the
         outstanding Voting Stock of such Person and such Person engages only in
         a business of the type conducted by the Company on the Original Issue
         Date or in a business ancillary thereto; and

                  (vi) Investments resulting from the transfer of Accounts
         Receivable from the Company or any of its Subsidiaries to a Subsidiary,
         the only business of which is the acquisition and financing of such
         Accounts Receivable under a Credit Facility.

         "PERMITTED REFINANCING INDEBTEDNESS" means Indebtedness incurred in
exchange for, or the net proceeds of which are applied to refund, refinance or
extend, any Indebtedness, provided that:

                  (i) the Permitted Refinancing Indebtedness is the obligation
         of the same Person (or if the Indebtedness being refinanced is an
         obligation of one or more Subsidiaries of the Company, the Permitted
         Refinancing Indebtedness may be incurred by the Company or one or more
         other Subsidiaries of the Company) and is subordinated to the Notes, if
         at all, to

                                       13

<PAGE>

         the same extent as the Indebtedness being refunded, refinanced or
         extended;

                  (ii) the Permitted Refinancing Indebtedness is scheduled to
         mature no earlier than the Indebtedness being refunded, refinanced or
         extended;

                  (iii)the Permitted Refinancing Indebtedness has a Weighted
         Average Life to Maturity at the time the Permitted Refinancing
         Indebtedness is incurred that is equal to or greater than the Weighted
         Average Life to Maturity of the portion of the Indebtedness being
         refunded, refinanced or extended;

                  (iv) the Permitted Refinancing Indebtedness is secured only to
         the extent, if at all, and by the assets that the Indebtedness being
         refunded, refinanced or extended is secured; and

                  (v) the Permitted Refinancing Indebtedness is in an aggregate
         principal amount that is equal to or less than the aggregate principal
         amount then outstanding under the Indebtedness being refunded,
         refinanced or extended (except for issuance costs and increases in
         Attributable Debt due solely to increases in the present value
         calculations resulting from renewals or extensions of the terms of the
         underlying leases in effect on the Original Issue Date of the Notes).

         "PREFERRED STOCK" means with respect to any Person all Capital Stock of
such Person that has a preference in liquidation or a preference with respect to
the payment of dividends or distributions of operating profit or cash.

         "PRINCIPAL PROPERTY" means any manufacturing plant or distribution
facility, together with the land upon which it is erected and fixtures
comprising a part thereof, owned by the Company or any Restricted Subsidiary and
located in the United States, the gross book value (without deduction of any
reserve for depreciation) of which on the date as of which the determination is
being made is an amount which exceeds 1.0% of Consolidated Net Tangible Assets,
other than any such manufacturing plant or distribution facility or any portion
thereof or any such fixture (together with the land upon which it is erected and
fixtures comprising a part thereof) (i) which is financed by industrial
development bonds, industrial revenue bonds, pollution control bonds or other
similar Debt issued or guaranteed by the United States of America or any U.S.
state, or any department, agency, instrumentality or political subdivision of
the United States of America or any U.S. state or (ii) which, in the opinion of
the board of directors of the Company as evidenced by a Board Resolution, is not
of material importance to the total business conducted by the Company and its
Subsidiaries, taken as a whole.

                                       14

<PAGE>

         "RATING AGENCIES" means (i) S&P and Moody's or (ii) if S&P or Moody's
or both of them are not making ratings of the Notes publicly available, a
nationally recognized U.S. rating agency or agencies, as the case may be,
selected by the Company, which will be substituted for S&P or Moody's or both,
as the case may be.

         "RATING CATEGORY" means (i) with respect to S&P, any of the following
categories (any of which may include a "+" or "--"): AAA, AA, A, BBB, BB, B,
CCC, CC, C and D (or equivalent successor categories); (ii) with respect to
Moody's, any of the following categories (any of which may include a "1," "2" or
"3"): Aaa, Aa, A, Baa, Ba, B, Caa, Ca, C and D (or equivalent successor
categories); and (iii) the equivalent of any such categories of S&P or Moody's
used by another Rating Agency, if applicable.

         "RESTRICTED PAYMENT" means with respect to any Person:

                  (i) the declaration of any dividend or the making of any other
         payment or distribution of cash, securities or other property or assets
         in respect of such Person's Capital Stock (except that a dividend
         payable solely in Capital Stock (other than Disqualified Stock) of such
         Person will not constitute a Restricted Payment);

                  (ii) any payment on account of the purchase, redemption,
         retirement or other acquisition for value of such Person's or such
         Person's Subsidiaries' Capital Stock or any other payment or
         distribution made in respect thereof, either directly or indirectly;

                  (iii) any payment on account of the purchase, redemption,
         retirement, defeasance or other acquisition for value, prior to any
         scheduled principal payment, sinking fund payment or stated maturity,
         of Subordinated Indebtedness of the Company or its Subsidiaries;

                  (iv) the incurrence, creation or assumption of any guarantee
         of Indebtedness of any Affiliate (other than a Subsidiary of the
         Company); or

                  (v) the making of any Investment in any Person (other than
         Permitted Investments);

         provided, however, that with respect to the Company and its
         Subsidiaries, Restricted Payments will not include any payment
         described in clause (i), (ii) or (iii) above made (A) to the Company or
         any of its Wholly Owned Subsidiaries by any of the Company's
         Subsidiaries, (B) by the Company to any of its Wholly Owned
         Subsidiaries or (C) by any Subsidiary, provided that the Company or
         another Subsidiary of the Company receives its proportionate share
         thereof.

                                       15

<PAGE>

         "RESTRICTED SUBSIDIARY" means any Subsidiary of the Company that, at
the time of determination, all of the outstanding Capital Stock (other than
directors' qualifying shares) is owned by the Company directly or indirectly and
which, at the time of determination, is primarily engaged in manufacturing,
except a Subsidiary that (i) neither transacts any substantial portion of its
business nor regularly maintains any substantial portion of its fixed assets
within the United States of America, (ii) is engaged primarily in the finance
business including, without limitation thereto, financing the operations of, or
the purchase of products which are products of or incorporate products of, the
Company or its Subsidiaries or (iii) is primarily engaged in ownership and
development of real estate, construction of buildings, or related activities, or
a combination of the foregoing. In the event that there shall at any time be a
question as to whether a Subsidiary is primarily engaged in manufacturing or is
described in clause (i), (ii) or (iii) above, such matter will be determined for
all purposes of the Indenture by a Board Resolution.

         "S&P" means Standard & Poor's Rating Services, a division of the
McGraw-Hill Companies, Inc., and its successors.

         "SALE AND LEASEBACK TRANSACTION" means any arrangement after the
Original Issue Date of the Notes with any bank, insurance company or other
lender or investor (other than the Company or any Restricted Subsidiary)
providing for the leasing by the Company or any Restricted Subsidiary of any
Principal Property for a period of more than three years, which was or is owned
or leased by the Company or any Restricted Subsidiary and which has been or is
to be sold or transferred by the Company or any Restricted Subsidiary, more than
180 days after the completion of construction and commencement of commercial
operations by the Company or such Restricted Subsidiary, to such lender or
investor or to any Person to whom funds have been or are to be advanced by such
lender or investor on the security of such Principal Property.

         "SUBORDINATED INDEBTEDNESS" of any Person means any Indebtedness of
such Person that is subordinated in right of payment to the Notes.

         "VOTING STOCK" means stock which ordinarily has voting power for the
election of directors, managers or trustees, whether at all times or only so
long as no senior class of stock has such voting power by reason of any
contingency.

         "WEIGHTED AVERAGE LIFE TO MATURITY" means, when applied to any
Indebtedness or portion thereof at any date, the number of years obtained by
dividing (i) the then outstanding principal amount of such Indebtedness or
portion thereof (if applicable) into (ii) the sum of the products obtained by
multiplying (A) the amount of each then remaining installment, sinking fund,
serial maturity or other required payment of principal, including payment at
final maturity, in respect thereof, by (B) the number of years (calculated to
the nearest one-twelfth) that will elapse between such date and the making of
such payment.

                                       16
<PAGE>
         "WHOLLY OWNED SUBSIDIARY" of any Person means (i) a Subsidiary of which
100% of the Voting Stock (except for director's qualifying shares or certain
minority interests owned by other Persons solely due to local law requirements
that there be more than one stockholder, but which interest is not in excess of
what is required for such purpose) is owned directly by such Person or through
one or more other Wholly Owned Subsidiaries of such Person and (ii) any entity
other than a corporation in which such Person, directly or indirectly, owns all
of the Voting Stock of such entity.

         (d) The defined term "SUBSIDIARY" in Section 1.01 of the Base Indenture
shall be replaced in its entirety by the following defined term for purposes of
the Indenture:

         "SUBSIDIARY" of any Person means any corporation, association or other
business entity of which at the time of determination such Person or one or more
of such Person's Subsidiaries owns or controls more than 50% of the shares of
Voting Stock.

         Section 1.03. Other Definitions. Each of the following terms is defined
in the section set forth opposite such term:

<TABLE>
<CAPTION>
                        TERM                                               SECTION
                        ----                                               -------
<S>                                                               <C>
Asset Sale Offer............................................           Section 5.06(e)
Asset Sale Payment Amount...................................         Section 5.06(e)(i)
Asset Sale Purchase Price...................................         Section 5.06(e)(ii)
Base Indenture..............................................              Recitals
cash........................................................           Section 5.06(b)
Change of Control Offer.....................................           Section 5.07(a)
Change of Control Purchase Date.............................           Section 5.07(a)
Change of Control Purchase Price............................           Section 5.07(a)
DTC.........................................................            Section 2.05
Excess Proceeds.............................................           Section 5.06(e)
Excess Proceeds Payment Date................................         Section 5.06(f)(ii)
Events of Default...........................................            Section 4.01
Indenture...................................................              Recitals
Net Proceeds Deficiency.....................................         Section 5.06(e)(ii)
Notes.......................................................            Section 2.01
Notice of Default...........................................           Section 4.01(b)
Other Debt..................................................         Section 5.06(e)(iv)
Restricted Securities.......................................            Section 5.02
</TABLE>

                                   ARTICLE 2
                               THE SERIES OF NOTES

         Section 2.01. Title. There shall be a series of Securities designated
the 7.25% Notes due 2013 (the "NOTES").

                                       17
<PAGE>

         Section 2.02. Principal Amount. The aggregate principal amount of the
Notes which may be authenticated and delivered under this Supplemental Indenture
shall initially be $125,000,000. The Notes need not be issued at one time and,
unless otherwise provided, Notes may also be issued by the Company and
authenticated and delivered under this Indenture after the Original Issue Date
on the same terms and conditions (other than the issue date and the issue price)
and with the same CUSIP number as the Notes issued on the Original Issue Date
and in an aggregate principal amount, together with the Notes issued on the
Original Issue Date, exceeding the amount set forth in the preceding sentence.

         Section 2.03. Form of Notes. The Notes shall be substantially in the
form of Exhibit A attached hereto. The terms of such Notes are herein
incorporated by reference and are part of this Supplemental Indenture.

         Section 2.04. Denomination and Date of Securities; Payment of Interest.
(a) The Notes shall be issuable in denominations of $1,000 and any integral
multiple thereof.

         (b) Each Note shall be dated the date of its authentication and shall
bear interest from the most recent date to which interest has been paid on the
Notes, or, if no interest has been paid, from the date of original issuance of
the Notes. Interest on the Notes shall be payable on each Interest Payment Date.

         (c) Except as provided in Section 3.07 of the Base Indenture, the
person in whose name any Note is registered at the close of business on any
Regular Record Date with respect to any Interest Payment Date shall be entitled
to receive the interest, if any, payable on such Interest Payment Date,
notwithstanding any transfer or exchange of such Note subsequent to the Regular
Record Date and prior to such Interest Payment Date.

         Section 2.05. Depository. The Depository for any Notes issued as Global
Securities shall be The Depository Trust Company in The City of New York ("DTC")
or any successor Depository appointed by the Company within 90 days of the
termination of the services of DTC (or any successor to DTC).

                                   ARTICLE 3
                                   REDEMPTION

         Section 3.01. Optional Redemption. (a) Except as set forth in Section
3.01(b) hereof, the Company may not redeem the Notes before June 1, 2008.
Beginning on June 1, 2008, the Company may redeem all of the Notes at any time
or any portion of the Notes from time to time, at a redemption price equal to
the percentage of the principal amount set forth below, plus accrued and unpaid
interest up to but not including the redemption price if redeemed during the 12
month period commencing on June 1, of the years set forth below; provided that
if the redemption date falls after the Regular Record Date and on or before the

                                       18
<PAGE>

Interest Payment Date, interest shall be payable to holders of record on the
relevant Regular Record Date.

<TABLE>
<CAPTION>
    12-MONTH PERIOD
  COMMENCING JUNE 1 IN
           YEAR                      PERCENTAGE
           ----                      ----------
<S>                                  <C>
           2008                       103.625%
           2009                       102.417%
           2010                       101.208%
     2011 and thereafter              100.000%
</TABLE>

         (b) Notwithstanding the foregoing, at any time and on more than one
occasion prior to June 1, 2006, the Company may redeem up to 35% of the
originally issued principal amount of the Notes with the proceeds of one more
Equity Offerings, at a redemption price of 107.25% of the principal amount
thereof plus accrued and unpaid interest, provided that (i) at least 65% of the
originally issued principal amount of the Notes remains outstanding immediately
after such redemption (other than Notes held, directly or indirectly, by the
Company and its Affiliates) and (ii) each such redemption occurs within 60 days
after the completion of the related Equity Offering.

         (c) Any redemption pursuant to this Article 3 shall be made pursuant to
the provisions of Article 11 of the Base Indenture.

                                   ARTICLE 4
                                EVENTS OF DEFAULT

         Section 4.01. Additional Events of Default Applicable to the Notes.
Pursuant to Section 5.01(g) of the Base Indenture, the following additional
"EVENTS OF DEFAULT" shall apply with respect to the Notes:

         (a) default in the performance, or breach, of any covenant or
obligation of the Company under Sections 5.06, 5.07 and 6.01 hereof; and

         (b) default under any Indebtedness of the Company (including a default
with respect to Securities of any series other than the Notes), whether such
Indebtedness exists as of the Original Issue Date or shall thereafter be
created, which default shall have resulted in such Indebtedness in an aggregate
principal amount exceeding $25,000,000 becoming or being declared due and
payable prior to the date on which it would otherwise have become due and
payable, without such acceleration having been rescinded or annulled within a
period of 60 days after there shall have been given, by registered or certified
mail, to the Company by the Trustee or to the Company and the Trustee by the
Holders of at least 50% in principal amount of the Outstanding Notes a written
notice specifying such default and requiring the Company to cause such
acceleration to be rescinded or annulled and stating that such notice is a
"NOTICE OF DEFAULT" hereunder;

                                       19
<PAGE>

provided, however, that if, prior to a declaration of acceleration of the
Maturity of the Notes or the entry of judgment in favor of the Trustee in a suit
pursuant to Section 5.03 of the Base Indenture, such default under such bonds,
debentures, notes or other evidences of indebtedness shall be remedied or cured
by the Company or waived by the holders of such Indebtedness, then the Event of
Default under the Indenture by reason thereof shall be deemed likewise to have
been thereupon remedied, cured or waived without further action upon the part of
either the Trustee or any of the Holders of Notes.

                                   ARTICLE 5
                                    COVENANTS

         Section 5.01. Reports. In addition to the covenants set forth in
Article 10 of the Base Indenture, the Company covenants and agrees for the
benefit of the Notes, and whether or not required by the rules and regulations
of the Commission, that so long as any Notes are Outstanding, the Company shall
file with the Commission, to the extent such filings are accepted by the
Commission, and shall furnish (within 15 days after such filing) to the Trustee
and to the Holders all quarterly and annual reports and other information,
documents and reports that would be required to be filed with the Commission
pursuant to Section 13 of the Securities and Exchange Act of 1934 if the Company
were required to file under such Section.

         Section 5.02. Limitations upon Liens. In addition to the covenants set
forth in Article 10 of the Base Indenture, the Company covenants and agrees for
the benefit of the Notes that neither it nor any Subsidiary will create, incur,
issue or assume any Indebtedness secured by any Lien on any Principal Property
now owned or hereafter acquired by the Company or any Restricted Subsidiary, and
that neither the Company nor any Subsidiary will create, incur, issue or assume
any Indebtedness secured by any Lien on any shares of stock or Indebtedness now
existing, or created or acquired after the Original Issue Date of any Restricted
Subsidiary (such shares of stock or Indebtedness of any Restricted Subsidiary
being called "RESTRICTED SECURITIES"), without in any such case effectively
providing concurrently with the incurrence, creation, issuance or assumption of
any such Indebtedness or the grant of any Lien with respect to any such
Indebtedness that the Notes (together with, if the Company shall so determine,
any other Indebtedness of the Company or such Subsidiary then existing or
thereafter created which is not subordinate to the Notes) shall be secured
equally and ratably with (or prior to) such secured Indebtedness, so long as
such secured Indebtedness shall be so secured. The foregoing restriction shall
not, however, apply to Indebtedness secured by:

         (a) Liens on any Principal Property or Restricted Securities of the
Company or any Subsidiary existing on the Original Issue Date of the Notes;

                                       20
<PAGE>

         (b) Liens on any Principal Property or Restricted Securities of any
corporation existing at the time such corporation becomes a Restricted
Subsidiary or is merged with or into or consolidated with the Company or
Restricted Subsidiary, or at the time of a sale, lease or other disposition of
the properties of a corporation as an entirety or substantially as an entirety
to the Company or a Restricted Subsidiary, or arising thereafter pursuant to
contractual commitments entered into prior to and not in contemplation of such
corporation becoming a Restricted Subsidiary or not in contemplation of any such
merger or consolidation or any such sale, lease or other disposition;

         (c) Liens on any Principal Property or Restricted Securities of the
Company or any Subsidiary existing at the time of acquisition thereof (including
acquisition through merger or consolidation) or securing the payment of all or
any part of the purchase price or construction cost thereof or securing any
Indebtedness incurred prior to, at the time of or within 360 days after, the
acquisition of such Principal Property or Restricted Securities or the
completion of any such construction, whichever is later, for the purposes of
financing all or any part of the purchase price or construction cost thereof;

         (d) Liens on any Principal Property to secure all or any part of the
cost of development, operation, construction, alteration, repair or improvement
of all or any part of such Principal Property, or to secure Indebtedness
incurred prior to, at the time of or within 360 days after, the completion of
such development, operation, construction, alteration, repair or improvement,
whichever is later, for the purpose of financing all or any part of such cost;

         (e) Liens which secure Indebtedness owing by a Subsidiary of the
Company to the Company or to a Restricted Subsidiary;

         (f) Liens on the property of the Company or a Restricted Subsidiary in
favor of the United States of America or any State thereof, or any department,
agency, instrumentality or political subdivision of the United States of America
or any State thereof, (i) to secure partial, progress, advance or other payments
pursuant to any contract or statute, (ii) securing Indebtedness incurred to
finance all or any part of the purchase price or cost of constructing,
installing or improving the property subject to such mortgages including
mortgages to secure Indebtedness of the pollution control or industrial revenue
bond type, or (iii) securing Indebtedness issued or guaranteed by the United
States of America, any State thereof, any foreign country or any department,
agency, instrumentality or political subdivision of any such jurisdiction;

         (g) Liens in respect of the Company's facilities in Byhalia,
Mississippi to secure Indebtedness permitted to be incurred pursuant to the
Credit Facilities;

         (h) Liens securing Indebtedness incurred pursuant to Section
5.03(b)(iv) hereof; and

                                       21
<PAGE>

         (i) any extension, renewal, substitution or replacement of any of the
Liens referred to in clauses (a) through (h) above or the Indebtedness secured
thereby.

         Notwithstanding the foregoing, the Company and any Subsidiary of the
         Company may create, incur, issue or assume Indebtedness secured by a
         Lien which would otherwise be subject to the foregoing restrictions if
         the aggregate principal amount of all Indebtedness secured by Liens on
         Principal Properties and Restricted Securities then outstanding (not
         including any Indebtedness secured by Liens permitted to be incurred
         pursuant to clauses (a) through (i) above) plus Attributable Debt of
         the Company and its Restricted Subsidiaries in respect of Sale and
         Leaseback Transactions that would otherwise be subject to the
         restrictions described in Section 5.08 hereof does not at the time such
         Indebtedness is incurred exceed an amount equal to 12.5% of
         Consolidated Net Tangible Assets.

         For the purposes of this Section 5.02, the giving of a guarantee which
         is secured by a Lien on Principal Property or Restricted Securities,
         and the creation of a Lien on Principal Property or Restricted
         Securities to secure Indebtedness which existed prior to the creation
         of such Lien, shall be deemed to involve the creation of Indebtedness
         in an amount equal to the principal amount guaranteed or secured by
         such Lien; but the amount of Indebtedness secured by Liens on Principal
         Properties and Restricted Securities shall be computed without
         cumulating the underlying Indebtedness with any guarantee thereof or
         Lien securing the same.

         Section 5.03. Limitations on Additional Indebtedness and Subsidiary
Preferred Stock. Prior to the occurrence of the Fall-Away Event, the Company:

                  (i) shall not, and shall not permit any of its Subsidiaries
         to, directly or indirectly, create, incur, issue, assume, guarantee,
         extend the stated maturity of, or otherwise become liable with respect
         to, any Indebtedness (including Acquired Indebtedness); and

                  (ii) shall not permit any of its Subsidiaries to issue (except
         to the Company or any of its Wholly Owned Subsidiaries) or create any
         Preferred Stock or permit any Person (other than the Company or any of
         its Wholly Owned Subsidiaries) to own or hold any interest in any
         Preferred Stock of any such Subsidiary;

         provided, however, that the Company may incur Indebtedness and the
         Company may permit its Subsidiaries to issue or create Preferred Stock
         if, after giving effect thereto, the Company's Consolidated Interest
         Expense Coverage Ratio on such date would be at least 2.0 to 1.0,
         determined on a pro forma basis as if the incurrence of such additional
         Indebtedness or the issuance of such Preferred Stock (declared to have
         an aggregate principal

                                       22
<PAGE>

         amount equal to the aggregate liquidation value of such Preferred
         Stock), as the case may be, and the application of the net proceeds
         from such additional Indebtedness or Preferred Stock, had occurred at
         the beginning of the four-quarter period used to calculate the
         Company's Consolidated Interest Expense Coverage Ratio.

         (b) Notwithstanding the foregoing, and irrespective of the Consolidated
Interest Expense Coverage Ratio, in addition to Existing Indebtedness:

                  (i) the Company may incur Indebtedness pursuant to the Notes;

                  (ii) the Company may incur Indebtedness pursuant to the Credit
         Agreement;

                  (iii) the Company and its Subsidiaries may incur Indebtedness
         pursuant to Credit Facilities in an aggregate principal amount at any
         time outstanding not to exceed the excess of (A) $250,000,000 over (B)
         all Indebtedness outstanding under the Credit Agreement incurred
         pursuant to clause (ii) above, provided that the aggregate principal
         amount of such Indebtedness incurred by its Subsidiaries at any time
         outstanding shall not exceed $75,000,000;

                  (iv) the Company and its Subsidiaries may incur Indebtedness
         pursuant to Credit Facilities under which the principal amount that may
         be issued or otherwise obtained is based upon eligible Accounts
         Receivable or eligible Inventory and the aggregate principal amount of
         such Indebtedness at any time outstanding shall not exceed an amount
         equal to the sum of (A) 100% of the book value of the consolidated
         Accounts Receivable of the Company and its Consolidated Subsidiaries
         plus (B) 100% of the book value (excluding last-in-first-out reserves,
         if any) of the consolidated Inventory of the Company and its
         Consolidated Subsidiaries minus (C) the aggregate principal amount of
         outstanding Indebtedness secured by any Accounts Receivable or
         Inventory of the Company or any of its Consolidated Subsidiaries, other
         than Indebtedness outstanding under a Credit Facility, minus (D) other
         outstanding Investments (other than Indebtedness under a Credit
         Facility or as described in clause (C) above) under any asset
         securitization or similar facility in respect of Accounts Receivable or
         Inventory of the Company or its Consolidated Subsidiaries, provided
         that the aggregate principal amount of all such Indebtedness at any
         time outstanding shall not exceed $120,000,000;

                  (v) the Company and its Subsidiaries may incur Permitted
         Refinancing Indebtedness in exchange for, or the net proceeds of which
         are applied to refund, refinance or extend, Existing Indebtedness or
         other Indebtedness that was permitted by the Indenture to be incurred
         under this

                                       23
<PAGE>
         Section 5.03 except for Indebtedness incurred under clauses (ii),
         (iii), (iv), (vi) and (vii) of this Section 5.03(b);

                  (vi) the Company may incur any Indebtedness to any of its
         Subsidiaries or any of its Subsidiaries may incur any Indebtedness to
         the Company or to any other Subsidiary of the Company;

                  (vii) the Company and its Subsidiaries may incur any
         Indebtedness evidenced by letters of credit that are used in the
         ordinary course of business of the Company and its Subsidiaries (A) to
         secure workers' compensation and other insurance coverages or (B)
         otherwise so long as the aggregate reimbursement obligations with
         respect to letters of credit under this clause (B) at any one time
         outstanding shall not exceed $5,000,000;

                  (viii) the Company and its Subsidiaries may incur Capital
         Lease Obligations and Attributable Debt, in each case excluding
         Existing Indebtedness, but including all Permitted Refinancing
         Indebtedness incurred in exchange for, or the net proceeds of which are
         applied to refund, refinance or extend, any Indebtedness incurred
         pursuant to this clause, in an aggregate principal amount at any one
         time outstanding not to exceed 3.0% of Consolidated Net Tangible
         Assets;

                  (ix) the Company may incur Indebtedness, whether or not
         secured by a Lien, constituting all or a part of the purchase price of
         assets or property acquired or constructed after the Original Issue
         Date of the Notes, including all Permitted Refinancing Indebtedness
         incurred in exchange for, or the net proceeds of which are applied to
         refund, refinance or extend, any Indebtedness incurred pursuant to this
         clause, not to exceed 12.5% of Consolidated Net Tangible Assets at any
         time outstanding; and

                  (x) the Company's Subsidiaries may incur Indebtedness,
         including all Permitted Refinancing Indebtedness incurred in exchange
         for, or the net proceeds of which are applied to refund, refinance or
         extend, any Indebtedness incurred pursuant to this clause, in an
         aggregate principal amount at any time outstanding not to exceed
         $125,000,000, in addition to Existing Indebtedness and other
         Indebtedness permitted to be incurred by the Company's Subsidiaries
         pursuant to any of clauses (iii) through (viii) this Section 5.03(b).

         For purposes of determining compliance with this Section 5.03, if an
         item of proposed Indebtedness meets the criteria of more than one of
         the categories of permitted Indebtedness described in clauses (i)
         through (x) of this Section 5.03(b), or is entitled to be incurred
         pursuant to Section 5.03(a) hereof, the Company will be permitted to
         classify such item of Indebtedness on the date of its incurrence in any
         manner that complies with this Section 5.03.

                                       24
<PAGE>

         Section 5.04. Limitations on Restricted Payments. (a) Prior to the
occurrence of the Fall-Away Event, the Company shall not and shall not permit
any of its Subsidiaries to directly or indirectly, make any Restricted Payment
if at the time of such Restricted Payment:

                  (i) a Default or Event of Default under the Indenture has
         occurred and is continuing or will occur as a consequence of such
         Restricted Payment;

                  (ii) after giving effect to the proposed Restricted Payment,
         the amount of such Restricted Payment, when added to the aggregate
         amount of all Restricted Payments made after the Original Issue Date of
         the Notes, exceeds the sum of:

                           (A) 50.0% of the Company's Consolidated Net Income
                  accrued during the period (taken as a single period)
                  commencing on March 31, 2003 to and including the fiscal
                  quarter ended immediately prior to the date of such Restricted
                  Payment (or, if the aggregate Consolidated Net Income is a
                  deficit, minus 100.0% of that aggregate deficit), plus

                           (B) the net cash proceeds from the issuance and sale
                  of the Company's Capital Stock (other than to any of the
                  Company's Subsidiaries) that is not Disqualified Stock during
                  the period (taken as a single period) commencing with the
                  Original Issue Date of the Notes; or

                  (iii) the Company would not be able to incur an additional
         $1.00 of Indebtedness under the Consolidated Interest Expense Coverage
         Ratio under Section 5.03(a) hereof.

         (b) Notwithstanding the foregoing, the Company may:

                  (i) pay any dividend within 60 days after the date of
         declaration of such dividend if the payment of such dividend would have
         complied with the limitations of this Section 5.04 on the date of
         declaration;

                  (ii) retire shares of the Company's Capital Stock or
         Indebtedness of the Company or any of its Subsidiaries out of the
         proceeds of a substantially concurrent sale (other than to one of the
         Company's Subsidiaries) of shares of the Company's Capital Stock (other
         than Disqualified Stock);

                  (iii) make Investments that, when added to the aggregate
         amount of all such other Investments made pursuant to this clause after
         the Original Issue Date of the Notes, do not exceed 3.0% of the
         Company's

                                       25
<PAGE>
         Consolidated Net Tangible Assets at such time (with each such
         Investment being valued as of the date made and without regard to
         subsequent changes in value);

                  (iv) repurchase, redeem, acquire or otherwise retire for value
         any Capital Stock of the Company or any of its Subsidiaries held by any
         member of the Company's (or any of its Subsidiaries') management or
         former management pursuant to any management equity subscription
         agreement, stock option agreement, employment agreement, stock
         compensation plan or similar agreement but excluding payments made to
         holders upon the exercise of stock appreciation rights, approved by the
         Company's board of directors or a committee thereof consisting solely
         of two or more "non-employee directors" (within the meaning of Rule
         16b-3(b)(3)(i) under the Securities Exchange Act of 1934), provided
         that the aggregate price paid for all such repurchased, redeemed,
         acquired or retired Capital Stock may not in an aggregate amount exceed
         (A) $5,000,000 in any twelve-month period plus (B) $5,000,000;

                  (v) pay any dividend in respect of shares of the Company's
         Capital Stock, provided that the aggregate amount of all such dividends
         paid pursuant to this clause, excluding dividends payable pursuant to
         clause (i) above, shall not exceed $20,000,000 in any fiscal year of
         the Company; provided, however, that to the extent that such dividends
         are not paid in such fiscal year pursuant to this clause, the aggregate
         unused amount thereof may be used at any time thereafter to repurchase
         the Company's Voting Stock on the New York Stock Exchange (or such
         other national securities exchange or automated quotation system on
         which the Company's Voting Stock is then listed or quoted) pursuant to
         a stock repurchase program approved by the Company's board of
         directors; and

                  (vi) make other Restricted Payments in an aggregate amount not
         to exceed $30,000,000;

         provided, however, that each Restricted Payment described in clause (i)
         or (ii) of this Section 5.04(b) will be taken into account for purposes
         of computing the aggregate amount of all Restricted Payments pursuant
         to Section 5.04(a)(ii) hereof.

         Section 5.05. Limitations on Restrictions on Distributions from
Subsidiaries. Prior to the occurrence of the Fall-Away Event, the Company shall
not, and shall not permit any of its Subsidiaries to create or otherwise cause
or suffer to exist or become effective any consensual encumbrance or restriction
(other than encumbrances or restrictions imposed by law or by judicial or
regulatory action or by provisions in leases or other agreements that restrict
the assignability of the lease or assignment) on the ability of any of the
Company's Subsidiaries to:

                                       26
<PAGE>

         (a) pay dividends or make any other distributions on its Capital Stock
or any other interest or participation in, or measured by, its profits, owned by
the Company or any of its other Subsidiaries, or pay interest on or principal of
any Indebtedness owed to the Company or any of its other Subsidiaries;

         (b) make loans or advances to the Company or any of its other
Subsidiaries; or

         (c) transfer any of its properties or assets to the Company or any of
its other Subsidiaries,

in each case except for encumbrances or restrictions existing under or by reason
of:

                  (i) applicable law;

                  (ii) any of the Credit Facilities;

                  (iii) Existing Indebtedness and agreements evidencing such
         Existing Indebtedness as in effect on the Original Issue Date of the
         Notes;

                  (iv) any restrictions under any agreement evidencing any
         Acquired Indebtedness that was permitted to be incurred pursuant to the
         Indenture and that was not incurred in anticipation or contemplation of
         the related acquisition, provided that the restrictions and
         encumbrances only apply to assets that were subject to those
         restrictions and encumbrances prior to the acquisition of those assets
         by the Company or any of its Subsidiaries;

                  (v) restrictions or encumbrances replacing those permitted by
         clauses (ii), (iii) and (iv) of this Section 5.05(c) that, taken as a
         whole, are not materially more restrictive, as determined in good faith
         by the Company's board of directors;

                  (vi) the Indenture;

                  (vii) any restrictions and encumbrances arising in connection
         with Permitted Refinancing Indebtedness; provided, however, any
         restrictions or encumbrances of the type described in this clause that
         arise under Permitted Refinancing Indebtedness must not, taken as a
         whole, be materially more restrictive, as determined in good faith by
         the Company's board of directors, than those under the agreement
         creating or evidencing the Indebtedness being refunded or refinanced;

                  (viii) any restrictions with respect to a Subsidiary of the
         Company imposed pursuant to an agreement that has been entered into for
         the sale or other disposition of all or substantially all of the
         Capital Stock or assets of such Subsidiary;

                                       27
<PAGE>

                  (ix) any agreement restricting the sale or other disposition
         of property securing Indebtedness if such agreement does not expressly
         restrict the ability of a Subsidiary of the Company to pay dividends or
         make loans or advances; and

                  (x) customary restrictions in purchase money debt or leases
         relating to the property covered by such debt or lease.

         Section 5.06. Limitations on Asset Sales. (a) Prior to the occurrence
of the Fall-Away Event, the Company shall not and shall not permit any of its
Subsidiaries to consummate any Asset Sale unless:

                  (i) the Company or the selling Subsidiary receives
         consideration at the time of the Asset Sale at least equal to the Fair
         Market Value of the assets included in such Asset Sale;

                  (ii) immediately before and immediately after giving effect to
         such Asset Sale, no Default or Event of Default under the Indenture has
         occurred and is continuing; and

                  (iii) at least 50.0% of the consideration received in the
         Asset Sale by the Company or its selling Subsidiary is in the form of
         cash paid at the closing of such Asset Sale; provided, however, that if
         less than 50.0%, but at least 25.0%, of the consideration received at
         such closing by the Company or its selling Subsidiary is in the form of
         cash, such other consideration shall be deemed to be "cash" for this
         purpose if it consists of securities, notes or other obligations
         received by the Company or any of its Subsidiaries and is converted to
         cash no later than ten Business Days after such closing.

         (b) The term "CASH" for purposes of this Section 5.06 will include the
amount (without duplication) of any Indebtedness (other than Subordinated
Indebtedness) of the Company or its Subsidiary that is expressly assumed by the
transferee in such Asset Sale and with respect to which the Company or its
Subsidiary, as the case may be, is unconditionally released by the holder of
such assumed Indebtedness, as well as any notes, securities or similar
obligations or items of property received from such transferee that are
immediately converted, sold or exchanged by the Company or its Subsidiary for
cash (to the extent of the cash actually so received).

         (c) If at any time any non-cash consideration received by the Company
or any of its Subsidiaries, as the case may be, in connection with any Asset
Sale is converted into or sold or otherwise disposed of for cash (other than
interest received with respect to any of such non-cash consideration), then the
date of such conversion or disposition shall be deemed to constitute the date of
an Asset Sale under this Section 5.06 and the Net Proceeds thereof will be
applied in accordance with this Section 5.06.

                                       28
<PAGE>

            (d) Prior to the occurrence of the Fall-Away Event, if the Company
or any of its Subsidiaries engages in an Asset Sale, the Company or such
Subsidiary shall, no later than 360 days after such Asset Sale,

                  (i) apply all or any of the Net Proceeds from such Asset Sale
         to repay Indebtedness that ranks pari passu with the Notes;

                  (ii) invest, whether by way of capital expenditure,
         acquisition, addition to working capital or otherwise, all or any part
         of the Net Proceeds from such Asset Sale in any lines of business of
         the Company or of any of its Subsidiaries immediately prior to such
         investment; or

                  (iii) any combination of clauses (i) and (ii) of this Section
         5.06(d).

         (e) The amount of the Net Proceeds not applied or invested as provided
in Section 5.06(d) hereof, and in excess of $25,000,000, will constitute "EXCESS
PROCEEDS." Prior to the occurrence of the Fall-Away Event, when the cumulative
aggregate amount of Excess Proceeds equals or exceeds $25,000,000, the Company
shall be required to make an offer to purchase (an "ASSET SALE OFFER"), from all
Holders, an aggregate principal amount of Notes equal to the amount of the
Excess Proceeds as follows:

                  (i) The Company shall make an Asset Sale Offer to all Holders
         in accordance with the procedures set forth in this Section 5.06 to
         purchase the maximum principal amount (expressed as a multiple of
         $1,000) of Notes that may be purchased out of the amount (the "ASSET
         SALE PAYMENT AMOUNT") of such Excess Proceeds;

                  (ii) The offer price for the Notes shall be payable in cash in
         an amount equal to 100% of the principal amount of the Notes tendered
         pursuant to such Asset Sale Offer, plus accrued and unpaid interest to
         the date such Asset Sale Offer is consummated (the "ASSET SALE PURCHASE
         PRICE"), in accordance with the procedures set forth in this Section
         5.06. To the extent that the aggregate Asset Sale Purchase Price of
         Notes tendered pursuant to an Asset Sale Offer is less than the Asset
         Sale Payment Amount relating thereto (such shortfall constituting a
         "NET PROCEEDS DEFICIENCY"), the Company may use such Net Proceeds
         Deficiency, or a portion thereof, for general corporate purposes;

                  (iii) If the aggregate Asset Sale Purchase Price of Notes
         validly tendered and not withdrawn by holders thereof exceeds the Asset
         Sale Payment Amount, Notes to be purchased shall be selected on a pro
         rata basis; and

                                       29
<PAGE>

                  (iv) Upon completion of such Asset Sale Offer in accordance
         with the foregoing provisions, the amount of Excess Proceeds with
         respect to which such Asset Sale Offer was made shall be deemed to be
         zero.

         In the event that any other Indebtedness of the Company which ranks
         pari passu with the Notes ("OTHER DEBT") requires an offer to purchase
         to be made to repurchase such Other Debt upon the consummation of an
         Asset Sale, the Company may apply the Excess Proceeds to both purchase
         such Other Debt and to make an Asset Sale Offer, provided that the
         purchase price of such Other Debt does not exceed 100% of the aggregate
         principal amount or accreted value thereof plus interest thereon. With
         respect to any Excess Proceeds, the Company shall make the Asset Sale
         Offer in respect thereof at the same time as the analogous offer to
         purchase is made pursuant to any Other Debt and the purchase date in
         respect thereof shall be the same as the purchase date in respect
         thereof pursuant to any Other Debt.

         With respect to any Asset Sale Offer effected pursuant to this Section
         5.06, to the extent the aggregate principal amount of Notes and Other
         Debt, if any, tendered pursuant to such Asset Sale Offer and the
         concurrent offer to purchase with respect to such Other Debt exceeds
         the Excess Proceeds, such Notes and Other Debt, if any, shall be
         purchased pro rata based on the aggregate principal amount of such
         Notes and such Other Debt tendered by each holder thereof.

         (f) If the Company is required to make an Asset Sale Offer, the Company
shall, within 30 days following the date specified above, notify the Trustee
thereof and give written notice of such Asset Sale Offer to each Holder by
first-class mail, postage prepaid, at the address of such Holder appearing in
the register maintained by the Registrar, stating:

                  (i) that an Asset Sale Offer is being made pursuant to this
         Section 5.06;

                  (ii) that such Holders have the right to require the Company
         to apply the Excess Proceeds to repurchase the Notes at a purchase
         price in cash equal to 100% of the principal amount thereof plus
         accrued and unpaid interest, if any, to the purchase date which shall
         be no earlier than 30 days and not later than 60 days from the date
         such notice is mailed (the "EXCESS PROCEEDS PAYMENT DATE");

                  (iii) that any Note not tendered or accepted for payment will
         continue to accrue interest;

                  (iv) that any Notes accepted for payment pursuant to the Asset
         Sale Offer shall cease to accrue interest after the Excess Proceeds
         Payment Date;

                                       30
<PAGE>

                  (v) that Holders accepting the offer to have their Notes
         purchased pursuant to the Asset Sale Offer will be required to
         surrender the Notes, with the form entitled "Option of Holder to Elect
         Purchase" on the reverse of the form of Note attached hereto as Exhibit
         A, to the Paying Agent at the address specified in the notice prior to
         the close of business on the Business Day preceding the Excess Proceeds
         Payment Date;

                  (vi) that Holders will be entitled to withdraw their
         acceptance of the Asset Sale Offer if the Paying Agent receives, not
         later than the close of business on the third Business Day preceding
         the Excess Proceeds Payment Date, a telegram, facsimile transmission or
         letter setting forth the name of the Holder, the principal amount of
         the Notes delivered for purchase and a statement that such Holder is
         withdrawing his or her election to have such Notes purchased;

                  (vii) that if the aggregate principal amount of Notes
         surrendered by Holders exceeds the amount of Excess Proceeds, the
         Company shall select the Notes to be purchased on a pro rata basis so
         that the aggregate amount of Notes so purchased equals the amount of
         Excess Proceeds (with such adjustments as may be deemed appropriate by
         the Company so that only Notes in denominations of $1,000 or integral
         multiples thereof shall be purchased);

                  (viii) that Holders whose Notes are being purchased only in
         part will be issued new Notes equal in principal amount to the
         unpurchased portion of the Notes surrendered; provided that each Note
         purchased and each such new Note issued shall be in an original
         principal amount of $1,000 or an integral multiple thereof;

                  (ix) the calculations used in determining the amount of Excess
         Proceeds to be applied to the purchase of such Notes;

                  (x) any other procedures that a Holder must follow to accept
         an Asset Sale Offer or effect withdrawal of such acceptance; and

                  (xi) the name and address of the Paying Agent.

         On the Excess Proceeds Payment Date, the Company shall, to the extent
         lawful, (1) accept for payment, on a pro rata basis to the extent
         necessary, Notes or portions thereof tendered pursuant to the Asset
         Sale Offer, (2) deposit with the Paying Agent U.S. legal tender
         sufficient to pay the purchase price plus accrued and unpaid interest,
         if any, on the Notes to be purchased or portions thereof, (3) deliver
         or cause to be delivered to the Trustee Notes so accepted together with
         an Officer's Certificate stating that such Notes or portions thereof
         were accepted for payment by the Company in accordance with the terms
         of this Section 5.06. The Paying Agent shall promptly mail to each
         Holder of Notes so accepted payment in

                                       31
<PAGE>

         an amount equal to the purchase price for such Notes, and the Company
         shall execute and issue, and the Trustee shall promptly authenticate
         and make available for delivery to such Holder, a new Note equal in
         principal amount to any unpurchased portion of the Notes surrendered;
         provided that each Note purchased and each such new Note issued shall
         be in an original principal amount of $1,000 or an integral multiple
         thereof.

         The Company shall comply with the requirements of Rule14e-1 under the
         Securities and Exchange Act of 1934 and other securities laws and
         regulations thereunder to the extent such laws and regulations are
         applicable in connection with the repurchase of Notes pursuant to an
         Asset Sale Offer. To the extent that the provisions of any securities
         laws or regulations conflict with this Section 5.06, the Company shall
         comply with the applicable securities laws and regulations and shall
         not be deemed to have breached its obligations under this Section 5.06
         by virtue thereof.

         Section 5.07. Repurchase of Notes upon a Change of Control Prior to the
Fall-Away Event. (a) Upon the occurrence of a Change of Control and if the
Fall-Away Event has not occurred prior to the expiration of the 30-day period
immediately after the occurrence of such Change of Control, the Company shall be
obligated to make an offer to purchase (the "CHANGE OF CONTROL OFFER") the
outstanding Notes of each Holder in whole or in part in integral multiples of
$1,000, at a purchase price (the "CHANGE OF CONTROL PURCHASE PRICE") in cash in
an amount equal to 101% of the principal amount thereof, plus accrued interest,
if any, to the date of purchase (the "CHANGE OF CONTROL PURCHASE DATE"),
pursuant to the procedures set forth below.

            (a) Within 30 days following any Change of Control, and if the
Fall-Away Event has not occurred within the 30-day period immediately after the
occurrence of such Change of Control, the Company shall notify, in writing, the
Trustee thereof and give written notice of such Change of Control to each Holder
by first-class mail, postage prepaid, at the address of such Holder appearing in
the register maintained by the Registrar, stating, among other things:

                  (i) that the Change of Control Offer is being made pursuant to
         this Section 5.07;

                  (ii) that such Holders have the right to require the Company
         to repurchase such Notes at the Change of Control Purchase Price on the
         Change of Control Purchase Date which shall be no earlier than 30 days
         and not later than 60 days from the date such notice is mailed;

                  (iii) that any Note not tendered or accepted for payment will
         continue to accrue interest;

                  (iv) that, unless the Company defaults in its payment of the
         Change of Control Purchase Price, any Note accepted for payment

                                       32
<PAGE>
         pursuant to the Change of Control Offer shall cease to accrue interest
         after the Change of Control Purchase Date;

                  (v) that Holders accepting the offer to have their Notes
         purchased pursuant to a Change of Control Offer will be required to
         surrender the Notes, with the form entitled "Option of Holder to Elect
         Purchase" on the reverse of the form of Note attached hereto as Exhibit
         A, to the Paying Agent at the address specified in the notice prior to
         the close of business on the Business Day preceding the Change of
         Control Purchase Date;

                  (vi) that Holders will be entitled to withdraw their
         acceptance of the Change of Control Offer if the Paying Agent receives,
         not later than the close of business on the third Business Day
         preceding the Change of Control Purchase Date, a telegram, facsimile
         transmission or letter setting forth the name of the Holder, the
         principal amount of the Notes delivered for purchase and a statement
         that such Holder is withdrawing his or her election to have such Notes
         purchased;

                  (vii) any other procedures that a Holder must follow to accept
         a Change of Control Offer or effect withdrawal of such acceptance; and

                  (viii) the name and address of the Paying Agent.

         (c) On the Change of Control Payment Date, the Company shall, to the
extent lawful, (1) accept for payment Notes or portions thereof tendered
pursuant to the Change of Control Offer, (2) deposit with the Paying Agent U.S.
legal tender sufficient to pay the purchase price of all Notes or portions
thereof so tendered and (3) deliver or cause to be delivered to the Trustee
Notes so accepted together with an Officer's Certificate stating that such Notes
or portions thereof were accepted for payment by the Company pursuant to this
Section 5.07. The Paying Agent shall promptly mail to each Holder of Notes so
accepted payment in an amount equal to the purchase price for such Notes, and
the Company shall execute and issue, and the Trustee shall promptly authenticate
and mail to such Holder, a new Note equal in principal amount to any unpurchased
portion of the Notes surrendered; provided that each such new Note shall be
issued in an original principal amount of $1,000 or an integral multiple
thereof.

         (d) The Company shall comply with the requirements of Rule 14e-1 under
the Securities and Exchange Act of 1934 and other securities laws and
regulations thereunder to the extent such laws and regulations are applicable in
connection with the repurchase of Notes pursuant to a Change of Control Offer.
To the extent that the provisions of any securities laws or regulations conflict
with this Section 5.07, the Company shall comply with the applicable securities
laws and regulations and shall not be deemed to have breached its obligations
under this Section 5.07 by virtue thereof.

                                       33
<PAGE>

         Section 5.08. Limitations upon Sales and Leasebacks. After the
occurrence of the Fall-Away Event, the Company shall not, and nor shall it
permit any Restricted Subsidiary to, enter into a Sale and Leaseback Transaction
unless, either:

         (a) the Company and such Restricted Subsidiary would be entitled,
pursuant to the provisions described in Section 5.02 hereof, to incur Debt
secured by a Lien on such Principal Property in a principal amount equal to or
exceeding the Attributable Debt in respect of such Sale and Leaseback
Transaction without equally and ratably securing the Notes; or

         (b) the Company, within 180 days after the sale or transfer, applies or
causes such Restricted Subsidiary to apply an amount equal to the Net Proceeds
of such sale or transfer (as determined by any two of the following: the
President, any Vice President, the Treasurer and the Controller of the Company)
to the retirement of Notes or other Funded Debt of the Company (other than
Funded Debt subordinated to the Notes) or Funded Debt of a Restricted
Subsidiary; provided that the amount to be so applied shall be reduced by (A)
the principal amount of Notes delivered within 180 days after such sale or
transfer to the Trustee for retirement and cancellation, and (B) the principal
amount of any such Funded Debt of the Company or a Restricted Subsidiary, other
than Notes voluntarily retired by the Company or a Restricted Subsidiary within
180 days after such sale or transfer to the trustee for retirement and
cancellation, excluding in the case of both (A) and (B), retirement pursuant to
any mandatory sinking fund payment or any mandatory prepayment provision or by
payment at maturity.

         Section 5.09. Restrictions on Funded Debt of Restricted Subsidiaries.
After the occurrence of the Fall-Away Event, the Company shall not, and nor
shall it permit any Restricted Subsidiary to, create, incur, issue, assume or
guarantee any Funded Debt. This restriction will not apply if:

         (a) the Company or such Restricted Subsidiary could create Debt secured
by Liens in accordance with Section 5.02 hereof, or enter into a Sale or
Leaseback Transaction in accordance with Section 5.08 hereof, in an amount equal
to such Funded Debt, without equally and ratably securing the Notes;

         (b) such Funded Debt existed on the Original Issue Date;

         (c) such Funded Debt is owed to the Company or any of its Subsidiaries;

         (d) such Funded Debt existed at the time the corporation that issued
such Funded Debt became a Restricted Subsidiary, or was merged with or into or
consolidated with such Restricted Subsidiary, or at the time of a sale, lease or
other disposition of the properties of such corporation as an entirety to such
Restricted Subsidiary, or arising thereafter (i) otherwise than in connection
with the borrowing of money arranged thereafter and (ii) pursuant to contractual

                                       34
<PAGE>

commitments entered into prior to and not in contemplation of such corporation
becoming a Restricted Subsidiary and not in contemplation of any such merger or
consolidation or any such sale, lease or other disposition;

         (e) such Funded Debt is guaranteed by the Company;

         (f) such Funded Debt is guaranteed by a governmental agency;

         (g) such Funded Debt is issued, assumed or guaranteed in connection
with, or with a view to, compliance by such Restricted Subsidiary with the
requirements of any program adopted by any federal, state or local governmental
authority and applicable to such Restricted Subsidiary and providing financial
or tax benefits to such Restricted Subsidiary which are not available directly
to the Company;

         (h) such Funded Debt is issued, assumed or guaranteed to pay all or any
part of the purchase price or the construction cost of property or equipment
acquired or constructed by a Restricted Subsidiary, if such Funded Debt is
incurred within 360 days after acquisition, completion of construction or
commencement of full operation of such property, whichever is later;

         (i) such Funded Debt is non-recourse; or

         (j) such Funded Debt is incurred for the purpose of extending,
renewing, substituting, replacing or refunding Funded Debt permitted by clauses
(a) through (i) of this Section 5.09.

         Notwithstanding the foregoing, any Restricted Subsidiary may create,
         incur, issue, assume or guarantee Funded Debt which would otherwise be
         subject to the foregoing restrictions in an aggregate principal amount
         which, together with the aggregate outstanding principal amount of all
         other Funded Debt of Restricted Subsidiaries which would otherwise be
         subject to the foregoing restrictions (not including Funded Debt
         permitted to be incurred pursuant to clauses (a) through (j) of this
         Section 5.09), does not at the time such Funded Debt is incurred exceed
         an amount equal to 12.5% of Consolidated Net Tangible Assets.

                                    ARTICLE 6
              CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE

         Section 6.01. Consolidation, Merger, Sale of Assets, Etc. Prior to
Fall-Away Event. If any of the transactions described in Article 8 of the Base
Indenture shall occur prior to the occurrence of the Fall-Away Event, then
immediately after giving effect to such transaction and the use of any of the
net proceeds from such transaction on a pro forma basis, (i) the Consolidated
Net Worth of the Company or of the Company's successor, as the case may be,
shall

                                       35
<PAGE>

be at least equal to the Company's Consolidated Net Worth immediately prior to
such transaction and (ii) the Consolidated Interest Expense Coverage Ratio of
the Company or its successor, as the case may be, shall be such that the Company
or its successor, as the case may be, shall be entitled to incur at least $1.00
of additional Indebtedness under the Consolidated Interest Expense Coverage
Ratio test set forth in Section 5.03(a) hereof.

                                    ARTICLE 7
                       MODIFICATION, AMENDMENT AND WAIVER

         Section 7.01. Modification, Amendment and Waiver. The consent of each
Holder of each Outstanding Note shall be required to alter the Company's
obligation to make an Asset Sale Offer pursuant to Section 5.06 hereof or to
make a Change of Control Offer pursuant to Section 5.07 hereof.

                                    ARTICLE 8
                                   DEFEASANCE

         Section 8.01. Defeasance. The provisions of Sections 13.02 and 13.03 of
the Base Indenture will apply to the Notes.

         Section 8.02. Covenant Defeasance. Section 13.03 of the Base Indenture
is amended by (i) deleting "and" where it appears after "Section 5.01(f)" and
inserting a comma in its place and (ii) inserting "and any other obligations
specified in a Board Resolution or in one or more indentures supplemental
hereto" after "(if Section 5.01(g) is specified as applicable to the Securities
of such series)".

         Section 8.03. Additional Covenant Defeasance. In addition to the
obligations referred to in Section 13.03 of the Base Indenture, "covenant
defeasance", as defined in such Section, will also apply to the obligations of
the Company set forth in Article 5 of this Supplemental Indenture.

                                    ARTICLE 9
                                  MISCELLANEOUS

         Section 9.01. Supplemental Indenture. The Base Indenture, as
supplemented and amended by this Supplemental Indenture, is in all respects
hereby adopted, ratified and confirmed.

         Section 9.02. Counterparts. This Supplemental Indenture may be executed
in any number of counterparts, each of which shall be an original; but such
counterparts shall together constitute but one and the same instrument.

                                       36
<PAGE>

         Section 9.03. Governing Law. This Supplemental Indenture and the form
of Note attached hereto as Exhibit A shall be governed by and construed in
accordance with the laws of the State of New York applicable to agreements made
and to be performed entirely in such State, without regard to principles of
conflicts of laws.

                                       37
<PAGE>

         IN WITNESS WHEREOF, the parties hereto have caused this Supplemental
Indenture to be duly executed, as of the day and year first written above.

                                  THOMAS & BETTS CORPORATION

                                  By:    /s/ Thomas C. Oviatt
                                         --------------------------------------
                                         Name:    Thomas C. Oviatt
                                         Title:   Vice President - Treasurer

                                  THE BANK OF NEW YORK, as Trustee

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

<PAGE>
         IN WITNESS WHEREOF, the parties hereto have caused this Supplemental
Indenture to be duly executed, as of the day and year first written above.

                                  THOMAS & BETTS CORPORATION

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

                                  THE BANK OF NEW YORK, as Trustee

                                  By:    /s/ Robert A. Massimillo
                                         --------------------------------------
                                         Name:    Robert A. Massimillo
                                         Title:   Vice President

<PAGE>

                                                                       EXHIBIT A

                                 [FACE OF NOTE]

REGISTERED

No. 1
PRINCIPAL AMOUNT:  $125,000,000

CUSIP NO. 884315AF9

                           THOMAS & BETTS CORPORATION

                              7.25% NOTES DUE 2013

         UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (THE "DEPOSITORY") (55 WATER
STREET, NEW YORK, NEW YORK), TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF
TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF
CEDE & CO. OR IN SUCH OTHER NAME AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY, AND ANY PAYMENT HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER
ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY, ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.

         UNLESS AND UNTIL THIS NOTE IS EXCHANGED IN WHOLE OR IN PART FOR NOTES
IN CERTIFICATED FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE
DEPOSITORY TO A NOMINEE THEREOF OR BY A NOMINEE THEREOF TO THE DEPOSITORY OR
ANOTHER NOMINEE OF THE DEPOSITORY OR BY THE DEPOSITORY OR ANY SUCH NOMINEE TO A
SUCCESSOR DEPOSITORY OR NOMINEE OF SUCH SUCCESSOR DEPOSITORY.

                                      A-1
<PAGE>
         THOMAS & BETTS CORPORATION, a Tennessee corporation (the "COMPANY,"
which term includes any successor Person under the Indenture, as defined on the
reverse hereof), for value received, hereby promises to pay to CEDE & CO., C/O
THE DEPOSITORY TRUST COMPANY, 55 WATER STREET, NEW YORK, NEW YORK 10041, or
registered assigns, the principal sum of ONE HUNDRED TWENTY-FIVE MILLION DOLLARS
($125,000,000) on June 1, 2013.

         Interest Rate:  7.25% per annum.

         Interest Payment Dates: June 1 and December 1, commencing December 1,
2003.

         Regular Record Dates:  May 15 and November 15.

         Reference is made to the further provisions of this Note set forth on
the reverse hereof and the Indenture (as defined on the reverse hereof), which
shall for all purposes have the same effect as if set forth on the face hereof.

                                      A-2
<PAGE>
         IN WITNESS WHEREOF, the Company has caused this Note to be duly
executed.

         [Corporate Seal]

                                          THOMAS & BETTS CORPORATION

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

Attest:

----------------------------------
Name:  Penelope Turnbow
Title: Assistant Secretary

                                      A-3
<PAGE>
                          CERTIFICATE OF AUTHENTICATION

         This is one of the 7.25% Notes due 2013 referred to in the
within-mentioned Indenture.

         Dated:

                                    THE BANK OF NEW YORK, as Trustee

                                    By:
                                           --------------------------------
                                           Authorized Signatory

                                      A-4
<PAGE>
                                [REVERSE OF NOTE]

                              7.25% NOTES DUE 2013

         1. Indenture. The Company issued this Note pursuant to an Indenture
dated as of August 1, 1998, as supplemented by a Supplemental Indenture No. 2
dated as of May 27, 2003 (together, the "INDENTURE"), between the Company and
The Bank of New York, as trustee (the "TRUSTEE," which term includes any
successor trustee under the Indenture). This Note is one of a duly authorized
issue of Notes of the Company designated as its 7.25% Notes due 2013. The terms
of the Notes include those stated in the Indenture and those made part of the
Indenture by reference to the Trust Indenture Act. Notwithstanding anything to
the contrary herein, the Notes are subject to all such terms, and Holders of
Notes are referred to the Indenture and the Trust Indenture Act for a statement
of such terms. The Notes are senior unsecured obligations of the Company.

         Each Holder, by accepting a Note, agrees to be bound by all of the
terms and provisions of the Indenture, as the same may be amended from time to
time.

         2. Interest. The Company promises to pay interest on the principal
amount of this Note at a rate of 7.25% per annum. Interest on the Notes will
accrue from the most recent Interest Payment Date to which interest has been
paid or duly provided for, or if no interest has been paid, from the date of
original issuance of the Notes. The Company will pay interest semi-annually in
arrears on each Interest Payment Date, commencing December 1, 2003, until the
principal hereof is paid or duly provided for. Interest will be computed and
paid on the basis of a 360-day year comprised of twelve 30-day months.

         If any Interest Payment Date or the Maturity Date falls on a day that
is not a Business Day, principal or interest payable with respect to such
Interest Payment Date or Maturity Date, as the case may be, will be paid on the
next succeeding Business Day with the same force and effect as if it were paid
on the date such payment was due, and no interest shall accrue on the amount so
payable for the period from and after such Interest Payment Date or the Maturity
Date, as the case may be.

         Any such interest not so punctually paid or duly provided for shall
forthwith cease to be payable to the registered Holder on such Regular Record
Date and may either be paid (i) to the Person in whose name this Note is
registered at the close of business on a Special Record Date for the payment of
such Defaulted Interest to be fixed by the Trustee, notice of which shall be
given to Holders of Notes not less than 10 days prior to such Special Record
Date or (ii) at any time in any other lawful manner not inconsistent with the
requirements of any securities exchange on which the Notes of this series may be
listed, and upon such notice as may be required by such exchange, all as more
fully provided in the Indenture.

         3. Method of Payment. The Company shall pay interest on the Notes
(except Defaulted Interest) to the Persons who are the registered Holders at the
close of business on the Regular Record Date for such interest, which shall be
the May 15 or November 15 (whether or not such day is a Business Day),
immediately preceding the Interest Payment Date even if the

                                      A-5

<PAGE>
Notes are canceled on registration of transfer or registration of exchange after
such Regular Record Date.

         All payments of principal of, and any interest on the Notes issued in
global form will be made to the Depository as the registered holder thereof. The
Company expects that the Depository, upon receipt of payment of principal or
interest on such Note, will credit the accounts of persons who have accounts
with the Depository (the "PARTICIPANTS") with payment of principal or interest
on the date payable in amounts proportionate to their respective beneficial
interests in the principal amount of such Note as shown on the records of the
Depository. The Company also expects that payments by participants to owners of
beneficial interests in any Note held through such participants will be governed
by standing instructions and customary practices. Such payments will be the
responsibility of such participants.

         The Company is obligated to make payment of principal, premium, if any,
and interest in respect of this Note in United States dollars. The Company may,
at its option, pay principal, premium, if any, and interest by wire transfer in
U.S. legal tender. The Company may deliver any interest payment by check mailed
to the address of the Person entitled thereto as such address will appear on the
Security Register.

         4. Paying Agent and Registrar. The Company will at all times appoint
and maintain a Paying Agent (which may be the Trustee) authorized by the Company
to pay the principal, premium, if any, and interest on the Notes on behalf of
the Company and having an office or agency in New York, New York (the "PLACE OF
PAYMENT") where Notes may be presented or surrendered for payment and where
notices, designations or requests with respect to the Notes may be served. The
Company has initially appointed the Trustee to act as Paying Agent and
Registrar. The Company may change the Paying Agent or Registrar without notice
to the Holders. Neither the Company nor any of its Subsidiaries or Affiliates
may act as Paying Agent, although such entities may act as Registrar.

         5. Optional Redemption. Except as set forth below, the Company may not
redeem the Notes before June 1, 2008. Beginning on June 1, 2008, the Company may
redeem all of the Notes at any time or any portion of the Notes from time to
time, at a Redemption Price equal to the percentage of the principal amount set
forth below, plus accrued and unpaid interest up to but not including the
Redemption Price if redeemed during the 12-month period commencing on June 1, of
the years set forth below; provided that if the Redemption Price falls after the
Regular Record Date and on or before the Interest Payment Date, interest shall
be payable to holders of record on the relevant Regular Record Date.

<TABLE>
<CAPTION>
     12-MONTH PERIOD
   COMMENCING JUNE 1 IN
           YEAR                      PERCENTAGE
------------------------------- ---------------------
<S>                              <C>
           2008                       103.625%
           2009                       102.417%
           2010                       101.208%
     2011 and thereafter              100.000%
</TABLE>

         Notwithstanding the foregoing, at any time and on more than one
occasion prior to June 1, 2006, the Company may redeem up to 35% of the
originally issued principal amount of the

                                      A-6
<PAGE>
Notes with the proceeds of one more Equity Offerings, at a Redemption Price of
107.25% of the principal amount thereof plus accrued and unpaid interest,
provided that (i) at least 65% of the originally issued principal amount of the
Notes remains outstanding immediately after such redemption (other than Notes
held, directly or indirectly, by the Company and its Affiliates) and (ii) each
such redemption occurs within 60 days after the completion of the related Equity
Offering.

         If less than all of the Notes are to be redeemed at any time, selection
of the Notes to be redeemed will be made by the Trustee from among the
Outstanding Notes on a pro rata basis, by lot or by any other method permitted
in the Indenture. On and after the Redemption Date, interest will cease to
accrue on the Notes or portions thereof called for redemption.

         The Notes will not be entitled to any sinking fund.

         6. Notice of Redemption. Notice of redemption under the preceding
paragraph of this Note will be mailed at least 30 days but not more than 60 days
before the Redemption Date to each Holder of Notes to be redeemed at such
Holder's registered address.

         Except as set forth in the Indenture, if monies for the redemption of
the Notes called for redemption shall have been deposited with the Paying Agent
for redemption on such Redemption Date, then the Notes called for redemption
will cease to bear interest from and after such Redemption Date and the only
right of the Holders of such Notes will be to receive payment of the Redemption
Price plus interest accrued through the Redemption Date, if any.

         7. Offers to Purchase. Prior to the occurrence of the Fall-Away Event,
the Indenture provides that, after certain Asset Sales or upon the occurrence of
a Change of Control, and subject to further limitations contained therein, the
Company shall make an offer to purchase certain amounts of the Notes in
accordance with the procedures set forth in the Indenture.

         8. Denominations; Transfer; Exchange. The Notes are in definitive,
fully registered form, without coupons, in minimum denominations of U.S.$1,000
and in integral multiples of U.S.$1,000 in excess thereof. A Holder shall
register the transfer or exchange of Notes in accordance with the Indenture and
the Registrar may require a Holder, among other things, to furnish appropriate
endorsements and transfer documents in connection therewith as permitted by the
Indenture. No service charge shall be made for any such registration of transfer
or exchange, but the Company may require payment of a sum sufficient to cover
any tax or other governmental charge payable in connection therewith. The
Registrar need not register the transfer of or exchange of any Notes or portions
thereof selected for redemption.

         9. Persons Deemed Owners. Prior to due presentment of this Note for
registration of transfer, the Company, the Trustee and any agent of the Company
or the Trustee may treat the Person in whose name this Note is registered as the
owner hereof for all purposes, whether or not this Note be overdue, and neither
the Company, the Trustee nor any such agent shall be affected by notice to the
contrary.

         10. Unclaimed Money. If money for the payment of principal or interest
remains unclaimed for two years (or such shorter period for the return of such
moneys to the Company under applicable abandoned property laws), the Trustee and
the Paying Agent will pay the

                                      A-7
<PAGE>
money back to the Company. After that, Holders entitled to money must look to
the Company for payment as general creditors unless an "abandoned property" law
designates another person.

         11. Defeasance and Covenant Defeasance. The Indenture contains
provisions for defeasance at any time of (i) the entire indebtedness of this
Note or (ii) certain respective covenants and Events of Default with respect to
this Note, in each case upon compliance with certain conditions set forth
therein, which provisions apply to the Notes.

         At the option of the Company and upon satisfaction of certain
conditions specified in the Indenture, either (a) the Company shall be deemed to
have paid and discharged the entire indebtedness on the Notes or (b) the Company
need not comply with certain covenants contained in the Indenture, in each case
upon the deposit by the Company with the Trustee in trust for the Holders of the
Notes of an amount of funds or obligations issued or guaranteed by the United
States of America sufficient to pay and discharge upon the Stated Maturity
thereof the entire indebtedness evidenced by the Notes, all as provided in the
Indenture.

         No reference herein to the Indenture and no provision of this Note or
of the Indenture shall alter or impair the obligation of the Company, which is
absolute and unconditional, to pay the principal of and interest on this Note at
the times, places and rate, and in the currency herein prescribed.

         12. Amendments, Supplements, and Waivers. The Indenture permits, with
certain exceptions as therein provided, the amendment thereof and the
modification of the rights and obligations of the Company and the rights of the
Holders of Notes at any time by the Company and the Trustee with the consent of
a majority in aggregate Outstanding principal amount of the Notes. The Indenture
also contains provisions permitting the Holders of specified percentages in
aggregate Outstanding principal amount of the Notes to waive compliance by the
Company with certain provisions of the Indenture and certain past Defaults under
the Indenture and their consequences. Any such consent or waiver by the Holder
of this Note shall be conclusive and binding upon such Holder and upon all
future Holders of this Note and of any Note or Notes issued upon the
registration of transfer hereof or in exchange hereof or in lieu hereof, whether
or not a notation of such consent or waiver is made upon this Note.

         Without notice to or consent of any Holder, the parties thereto may
amend or supplement the Indenture or the Notes to, among other things, cure any
ambiguity, defect or inconsistency or make any other change that does not
adversely affect in any material respect the rights of any Holder of a Note.

         13. Restrictive Covenants. The Indenture imposes certain limitations on
the ability of the Company and/or its Subsidiaries to, among other things, incur
additional Indebtedness, issue Preferred Stock, make Restricted Payments
(including dividends, other distributions and investments), create dividend or
other payment restrictions affecting Subsidiaries of the Company, make Asset
Sales, create Liens, merge or consolidate with or into any other Person or sell,
lease, convey or otherwise dispose of all or substantially all of its assets.
Such limitations are subject to a number of qualifications and exceptions and,
in certain instances upon the occurrence of certain events, cease to be binding
upon the Company and its Subsidiaries. The

                                      A-8
<PAGE>
Company shall report on an annual basis to the Trustee on compliance with all
conditions and covenants of the Indenture.

         14. Successor. When a successor Corporation assumes, in accordance with
the Indenture, all the obligations of its predecessor under the Notes and the
Indenture, and immediately before and thereafter no Default exists and certain
other conditions are satisfied, the predecessor Corporation will be released
from those obligations.

         15. Defaults and Remedies. In case an Event of Default with respect to
the Notes shall occur and be continuing, the principal of the Notes may be
declared due and payable in the manner and with the effect provided in the
Indenture.

         16. Trustee Dealings with Company. The Trustee under the Indenture, in
its individual or any other capacity, may make loans to, accept deposits from
and perform services for the Company, and may otherwise deal with the Company,
its Subsidiaries or their respective Affiliates as if it were not the Trustee.

         17. No Recourse Against Others. This Note and all documents,
agreements, understandings and arrangements relating to any transaction
contemplated hereby or thereby have been executed or entered into by an officer
of the Company in his/her capacity as an officer of the Company which has been
formed as a Tennessee corporation, and not individually, and neither the
trustees, directors, officers, employees or shareholders of the Company shall be
bound or have any personal liability hereunder or thereunder. Each party hereto
shall look solely to the assets of the Company for satisfaction of any liability
of the Company in respect of this Note and all documents, agreements,
understandings and arrangements relating to any transaction contemplated hereby
or thereby and will not seek recourse or commence any action against any of the
trustees, directors, officers, employees or shareholders of the Compan, or any
of their personal assets, for the performance or payment of any obligation
hereunder or thereunder. By accepting a Note, each Holder shall waive and
release all such liability. The waiver and release shall be part of the
consideration for the issue of the Notes. The foregoing shall also apply to any
future documents, agreements, understandings, arrangements and transactions
between the parties hereto.

         18. Authentication. Unless the Certificate of Authentication hereon has
been executed by the Trustee by manual signature, this Note shall not be
entitled to any benefit under the Indenture or be valid or obligatory for any
purpose.

         19. Counterparts. The parties may sign multiple counterparts of this
Note. Each signed counterpart shall be deemed an original but all of them
together represent one and the same Note.

         20. Governing Law. This Note shall be governed by and construed in
accordance with the laws of the State of New York, as applied to agreements made
and to be performed entirely within the State of New York, without regard to
principles of conflicts of law. Each of the parties to the Indenture has agreed
to submit to the jurisdiction of the courts of the State of New York in any
action or proceeding arising out of or relating to this Note.

                                      A-9

<PAGE>

         21. Abbreviations and Defined Terms. Customary abbreviations may be
used in the name of a Holder of a Note or an assignee, such as: TEN COM (as
tenants in common); TEN ENT (as tenants by the entireties); JT TEN (as joint
tenants with right of survivorship and not as tenants in common); CUST
(Custodian); and U/G/M/A (Uniform Gifts to Minors Act).

         22. CUSIP Numbers. The Company has caused CUSIP numbers to be printed
on the Notes as a convenience to the Holders. No representation is made as to
the accuracy of such numbers either as printed on the Notes or as contained in
any notice of redemption, and reliance may be placed only on the other
identification numbers printed hereon, and any redemption of the Notes shall not
be affected by any defect in or omission of such numbers.

         The Company will furnish to any Holder of a Note upon written request
and without charge a copy of the Indenture. Requests may be made to: Thomas &
Betts Corporation, 8155 T&B Boulevard, Memphis, Tennessee 38125, Telephone No.
(901) 252-5000, Attention: Penelope Y. Turnbow.

                                      A-10
<PAGE>
                                 ASSIGNMENT FORM

         FOR VALUE RECEIVED, the undersigned hereby sell(s), assigns(s) and
transfer(s) unto

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

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

         PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF ASSIGNEE

 ----------------------------
/----------------------------/

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

--------------------------------------------------------------------------------
                     (Please Print or Type Name and Address
                     Including Postal Zip Code of Assignee)

--------------------------------------------------------------------------------
the within Note and all rights thereunder, and hereby irrevocably constitutes
and appoints

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

--------------------------------------------------------------------------------
to transfer said Note on the books of the Company, with full power of
substitution in the premises.

Dated:
      ------------------------------

Signature Guaranteed

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

NOTICE: Signature must be guaranteed      NOTICE: The signature to this
                                          assignment must correspond with the
                                          name as written upon the face of the
                                          within Note in every particular,
                                          without alteration or enlargement or
                                          any change whatever.

                                      A-11
<PAGE>
                      [OPTION OF HOLDER TO ELECT PURCHASE]

         If you elect to have this Note purchased by the Company in accordance
with the provisions of the Indenture governing Asset Sales or a Change of
Control of the Company, check the appropriate box:

                                            Asset Sales            [ ]
                                            Change of Control      [ ]

         If you elect to have only part of this Note purchased by the Company in
accordance with the provisions of the Indenture governing Asset Sales or a
Change of Control of the Company, state the amount you elect to have purchased:

$
   ------------------------

Date:
     ----------------------

---------------------------------------
(Sign exactly as your name appears on the other side of this Note)

                                      A-12

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