Document:

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                                  EXHIBIT 10.2

                AMENDED AND RESTATED MERCHANT SERVICES AGREEMENT

                    BETWEEN THE COMPANY AND HURLEY STATE BANK

                            DATED AS OF JULY 1, 2000

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                AMENDED AND RESTATED MERCHANT SERVICES AGREEMENT

         This AMENDED AND RESTATED MERCHANT SERVICES AGREEMENT ("Agreement")
made as of July 1, 2000, by and between HURLEY STATE BANK ("Bank"), a banking
corporation organized and existing under the laws of the State of South Dakota,
with its offices at Sioux Falls, South Dakota, and THE CHILDREN'S PLACE RETAIL
STORES, INC. ("Company"), a corporation organized and existing under the laws of
the State of Delaware, with its offices at 915 Secaucus Road, Secaucus, New
Jersey 07094.

                                   WITNESSETH:

         WHEREAS, Bank and Company entered into a Merchant Services Agreement
dated December 12, 1994, (the "Predecessor Agreement"), under which Bank issues
to consumers private label credit cards for use at Company's retail
establishments and via the Internet; and

         WHEREAS, Bank and Company desire to continue their relationship but
wish to amend and supplement certain provisions.

         NOW, THEREFORE, in consideration of the foregoing premises and mutual
covenants hereinafter set forth and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, Bank and Company
agree as follows:

                             ARTICLE I - DEFINITIONS

         1.1      DEFINITIONS. Except as otherwise specifically indicated, the
following terms will have the meaning specified herein:

                  "Account" means a Card account, whether issued under this
Agreement or the Predecessor Agreement. An Account may have more than one Card
issued for it. All Accounts are deemed to be the property of Bank. Bank will
determine the terms and conditions under which Accounts will be established.

                  "Active Account" means any Account that has not been written
off and that has a debit or credit balance at any time during a billing period.

                  "Application" means Bank's credit application which must be
completed by persons who wish to become Cardholders and which must be submitted
to Bank for review.

                  "Authorization" means permission from Bank to make a Card
Sale.

                  "Authorized Goods and Services" means goods and services
normally and customarily offered by Company at Stores and through the Internet.

                  "Authorization Center" means the facility designated by Bank
as the facility at which Card Sales are authorized.

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                  "Business Day" means Mondays through Fridays except days when
Bank is closed for business.

                  "Card" means a credit card issued by Bank with Company's name
and logo appearing on such card or with such other design as mutually acceptable
to the parties, which evidences an Account.

                  "Card Plan" means the program under which Accounts will be
established and Cards issued to qualified applicants.

                  "Card Sale" means any sale of Authorized Goods and Services
that Company makes to a Cardholder pursuant to this Agreement that is charged to
an Account.

                  "Cardholder" means any person to whom a Card has been issued
and/or any authorized user.

                  "Chargeback" means the refusal of Bank to pay Company for a
Card Sale or the return to Company and reimbursement to Bank of a Card Sale for
which Company was previously paid.

                  "Company Mark" means any name, logo, trademark, service mark
or other proprietary designation selected for use in connection with the Card
Plan. The Company Marks are set forth in Schedule C, as amended from time to
time.

                  "Credit" means a non-cash refund issued by Company to a
Cardholder of all or a portion of the amount of a Card Sale.

                  "Credit Slip" means evidence of a Credit in electronic or
paper form.

                  "Effective Date" means the date set forth in Section 4.4(a) of
this Agreement.

                  "Electronic Location" means a Company location at which there
is an Electronic Terminal.

                  "Electronic Terminal" means an electronic terminal or computer
capable of communicating by means of an on-line or dial-up electronic link
(whether routed through Bank's facilities or otherwise) with an Authorization
Center to obtain Authorization.

                  "Floor Limit" means the United States dollar amount designated
by Bank, as it may be changed from time to time, at or above which Authorization
must be obtained to make a Card Sale.

                  "Net Card Sales" means the total amount of Card Sales properly
remitted to Bank minus the total amount of Credits properly remitted to Bank.

                  "Operating Regulations" means the standard operating
procedures of Bank, as

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they may be changed by Bank from time to time in accordance with Section 2.4 of
this Agreement. The current version of the Operating Regulations is attached
hereto as Exhibit A. For purposes of this Agreement, the Operating Regulations
are deemed an integral part of this Agreement and references to this Agreement
will be deemed to include the Operating Regulations.

                  "Regular Revolving Card Plan" means all Card Plans other than
Special Credit Plans.

                  "Required Disclosures" means forms of credit disclosures and
disclosure documents provided by Bank which must be used by Company in
connection with advertising, marketing and promoting the Card Plan, accepting
Applications and making Card Sales.

                  "Sales Data" means the electronic data transmission of Card
transactions (e.g., Card Sales and Credits).

                  "Sales Slip" means evidence of a Card Sale in electronic or
paper form.

                  "Second Look Account" means an Account which did not qualify
for an Account under the Bank's standard credit granting criteria but which did
qualify for an Account under a higher risk - score model maintained by the Bank,
which shall have the sole and exclusive right to establish and modify credit
granting criteria for Second Look Accounts. Either party shall also have the
right to terminate the establishment of new Second Look Accounts at any time.

                  "Settlement" means the reimbursement to Company for the Net
Card Sales.

                  "Settlement Account" means the deposit account(s) at the
financial institution(s) designated by Company as the account(s) to be debited
and/or credited, as applicable, for the Settlement of Card transactions and the
payment of any fees and charges due hereunder.

                  "Special Credit Plan" means a Card Plan under which interest
is either waived or deferred for a period of time after the Card Sale. Payments
may or may not be required during the interest deferral or waiver period, and a
minimum purchase amount may be required. Special Credit Plans include without
limitation those described in Schedule E of this Agreement: "90 Days Same As
Cash".

                  "Store" means a retail store in the United States and its
territories owned and operated by Company.

         1.2.     CONSTRUCTION. Unless the context otherwise clearly indicates,
words used in the singular include the plural and words used in the plural
include the singular.

ARTICLE II - ISSUANCE OF ACCOUNTS AND ACCEPTANCE OF CARDS

         2.1      CONDITIONS OF OPENING ACCOUNTS. Subject to the terms and
conditions of this Agreement, Bank shall receive Applications for Card Accounts
and approve or decline Accounts in accordance with Bank's Account issuance
criteria.

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                  (a) WRITTEN APPLICATIONS. Applications which are received by
Bank through the mail and are not made contemporaneously with a sale will be
reviewed in accordance with Bank's customary practice for written Applications.

                  (b) APPLICATIONS WITH ACCOMPANYING SALE. Applications
transmitted to Bank in a mutually acceptable manner and format by Company's
employees in conjunction with a sale will be reviewed by Bank in accordance with
Bank's Account issuance criteria. Company shall be responsible for the
following:

                      (i) Providing all information required on
                  the Application which has been requested by Bank's
                  representative.

                      (ii) Obtaining positive identification and
                  verification of the person applying for the Account in
                  accordance with the Operating Regulations, which includes but
                  is not limited to obtaining the person's driver's license
                  number or state issued identification card number and social
                  security number.

                      (iii) Obtaining the signature on the
                  Application of all persons whose names will appear on the
                  Account or who will be responsible for the Account.

                      (iv) Upon either approval or decline,
                  sending the Application to Bank at the designated address
                  within five (5) Business Days.

                      (v) Entering the sale into Company's Electronic
                  Terminal. If requested to do so by Bank's representative,
                  Company's employee shall also enter into the Electronic
                  Terminal the approval code provided by Bank to Company.

                      (vi) Providing to each applicant a copy of the Hurley
                  State Bank Credit Card Agreement and any other Required
                  Disclosures Bank provides to Company for distribution to
                  applicants.

                  (c) INTERNET APPLICATIONS. Customers of Company who wish to
apply for a Card Account may do so via Company's Internet website, when such
becomes available. All Applications received by Bank via the Internet will be
processed only if all of the information requested on the website Application
form has been completed. Bank will request Customers who submit incomplete
Applications to provide missing information.

Failure to adhere to the above procedures may result in a Chargeback in
accordance with Section 2.10 of this Agreement.

         2.2      HONORING OF CARDS.

                  (a) CONDITIONS FOR HONORING CARDS. Subject to the terms and
conditions of this Agreement, Company agrees to accept the Card for payment of
Authorized Goods and Services in those instances when a Cardholder wishes to
charge the purchase of Authorized

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Goods and Services to his/her Account and Company shall not attempt to suppress
or discriminate against use of a Card by a Cardholder (except in accordance with
this Agreement). Company shall not knowingly permit Authorized Goods and
Services sold to commercial enterprises to be charged to Accounts. Company shall
accept the Card at all of its Stores in the United States and its territories
for the purchase of Authorized Goods and Services, provided the Sales Data
resulting from such acceptance of the Card is submitted to Bank in United States
dollars. Bank will advise Company if Bank develops the capability to accept
Sales Data in currencies other than United States dollars. In such event, Card
transactions may be made in such other currencies upon terms and conditions to
be mutually determined at that time. If any facility or service is operated on
Company premises under a franchise, lease or license from Company and such
franchisee, lessee or licensee (which is not a party to a merchant services
agreement with Bank) agrees with Company to accept Cards, Card transactions made
at such facility or service will be subject to the terms and conditions of this
Agreement and must be handled through Company as if Company had transacted such
Card transactions. Company shall be obligated to pay its franchisee, lessee or
licensee with respect to such Card transactions.

                  (b) COMMENCEMENT OF CARD ACCEPTANCE; PROMOTION OF CARD PLAN.
Acceptance of Cards by Company will commence on or about the date of this
Agreement or as soon thereafter as agreed to by the parties and will continue
until the termination of this Agreement. Company shall actively and consistently
promote, participate in and support the Card program and Card Plan throughout
the term of this Agreement. Company shall encourage customers to apply for Cards
and shall encourage Cardholders to use Cards for purchases of Authorized Goods
and Services. During the term of this Agreement neither Company nor any other
party on behalf of Company will enter into any arrangement or agreement with a
third party provider under which Company issues, sponsors, participates in or
accepts another private label credit card, or private label credit account; nor
shall Company or any other party on behalf of Company enter into any arrangement
or agreement with a third party provider under which Company issues, sponsors or
participates in the marketing of any cobranded credit card or credit account.
Notwithstanding the foregoing, nothing contained in this Agreement will be
construed to prohibit Company from accepting any major general purpose credit
card (e.g., NOVUS, American Express, MasterCard, Visa, Diner's Club and JCB) as
a means of payment by customers for purchases of Authorized Goods and Services.
Company agrees that Bank shall have the right to review, and approve or decline
each credit application submitted by a customer or prospective customer of
Company before such credit application is provided to any other party. Subject
to the foregoing sentence, Company may offer secondary sources of financing to
those of its customers that do not qualify for an Account, provided Company does
not issue, arrange to issue, or accept any private label credit card or private
label credit account in connection with such financing.

         2.3      ACCEPTANCE OF CARDS. Company shall accept each Card or valid
Active Account number presented by a Cardholder as payment for Authorized Goods
and Services provided that all of the following conditions are met with respect
to each Card Sale and that Company further complies with all of the procedures
set forth elsewhere in this Agreement and in the Operating Regulations relating
to the acceptance of Cards each time it makes a Card Sale:

                           (a)      The Card or valid Active Account number is
                  presented to

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                  Company on or before the expiration date, if any, shown on its
                  face;

                           (b)      The Card or valid Active Account number is
                  used as payment for Authorized Goods and Services purchased by
                  a Cardholder;

                           (c)      Company will not accept a Card or valid
                  Active Account number for the purpose of advancing money to a
                  Cardholder or paying money to a Cardholder for any amount that
                  is included in a Card Sale;

                           (d)      Company has followed the procedures for
                  the completion of Sales Slips as set forth in Section 2.5 of
                  this Agreement; and

                           (e)      Company has obtained Authorization for the
                  Card Sale if required pursuant to Section 2.6 of this
                  Agreement.

         2.4      OPERATING REGULATIONS. The Operating Regulations may be
changed by Bank from time to time upon not less than sixty (60) days prior
written notice to Company, provided, however, that changes which do not require
major systems or operational modifications and changes required for security
measures shall become effective as soon as possible following Company's receipt
of notice thereof but in all events shall become effective within ten (10) days
of Company's receipt of notice thereof. In the event of any conflict or
inconsistency between the terms of this Agreement and those of the Operating
Regulations, the former shall govern.

         2.5      COMPLETION OF SALES SLIPS.

                  (a) GENERAL REQUIREMENTS. For each Card Sale, Company shall
prepare a Sales Slip using a form that is mutually acceptable to Bank and
Company, E.G., a universal sales slip. Each Sales Slip must be legible and fully
completed with the information required under Section 2.5 of this Agreement, as
applicable. Company shall include all Authorized Goods and Services purchased in
a single transaction on one Sales Slip.

                  (b) MAIL/TELEPHONE/INTERNET ORDERS.  For each
mail/telephone/Internet order Card Sale, Company shall record the following on
the Sales Slip:

                      (i)   The date and location (city/state) of the Card
                  Sale, unless otherwise provided to Bank, E.G. batch reports,
                  etc.;

                      (ii)   A brief description of the Authorized Goods and
                  Services;

                      (iii)  The total amount of the Card Sale, including
                  tax;

                      (iv)   The Account number;

                      (v)    The expiration date, if any, of the Card;

                      (vi)   The Authorization number or code (where
                  applicable);

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                      (vii)  Company's merchant number, unless otherwise
                  provided to Bank, E.G. batch reports;

                      (viii) Work or daytime telephone number;

                      (ix)   The shipping address; and

                      (x)    The shipping date.

                  (c) RETAIL SALES. Each Sales Slip must be legible and fully
completed with the same information required for mail/telephone/Internet order
Card Sales (specified in Section 2.5(b) of this Agreement) excluding information
pertaining to a shipping address, work or daytime telephone number or shipping
date. Each Sales Slip relating to a Card transaction made at a retail location
must be imprinted to obtain a clear imprint of the Card; provided that in the
case of Sales Data which are electronically produced by Company, Company shall
not be required to obtain an imprint of the Card. A Sales Slip must be signed by
the Cardholder for each Card Sale at the time the Card Sale is made and in the
presence of an authorized representative or employee of Company. The signature
on the Sales Slip must be reasonably similar to the signature appearing on the
signature panel of the Card. After completion of the Card Sale, Company shall
provide a legible and completed copy of the Sales Slip to the Cardholder. If
Company fails to obtain the signature of the Cardholder on a Sales Slip and the
Cardholder has not authorized the Card Sale or denies the validity of the Card
Sale, the Card Sale shall be subject to Chargeback pursuant to Section 2.10 of
this Agreement.

         2.6      AUTHORIZATION.

                  (a) GENERAL REQUIREMENTS. In accordance with the terms of this
Section 2.6, Company must obtain Authorization for each proposed Card Sale at or
above the Floor Limit. For purposes of this Agreement, the purchase of one or
more items or other Authorized Goods and Services made by a Cardholder at one
Company Store and at one time will be deemed to constitute a single Card Sale.

                  (b) FLOOR LIMIT. The Floor Limit is $0. Bank may change the
Floor Limit upon notice to Company.

                  (c) OBTAINING AUTHORIZATION.

                      (i) ELECTRONIC LOCATIONS. To obtain Authorization for
                  Card Sales made at Electronic Locations, Company shall utilize
                  an Electronic Terminal in accordance with procedures
                  applicable for the use of that terminal. Company agrees that
                  the Electronic Terminals it uses will be those provided to
                  Company by Bank or its designee (at Company's expense) or will
                  be otherwise reasonably acceptable to Bank. At an Electronic
                  Location, if a referral code is displayed on an Electronic
                  Terminal, Company shall telephone Bank to obtain further
                  instructions, using a toll-free telephone number provided by
                  Bank for such purpose.

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                      (ii) NON-ELECTRONIC AUTHORIZATION. To obtain
                  Authorization when Bank's electronic capability to provide
                  Authorization or Company's electronic capability to obtain
                  Authorization is not operational, Company shall contact Bank
                  using a toll-free telephone number provided by Bank for such
                  purpose. If the Authorization Center approves the Card Sale,
                  Company will be given an Authorization code or number which
                  must be written on the Sales Slip.

                  (d) RIGHT OF CHARGEBACK. If Authorization for any Card Sale
is not obtained by Company, or requested by Company but declined by Bank, Bank
may process a Chargeback for such Card Sale pursuant to Section 2.10 of this
Agreement.

                  (e) CANCELLATION OF ACCOUNT/AUTHORIZATION. Once a consumer has
received the terms and conditions which apply to the credit card account, they
will have the option to not accept the terms and conditions and close their
Account. If this occurs, no sale can be posted to nor billed through the
Account. Bank will promptly notify Company and Company will be responsible for
making alternate payment arrangements with the consumer. In addition, at Bank's
expense, Bank will make available during Bank's normal authorization hours, a
toll-free number which Company may call in the event a previously authorized
Card Sale is canceled by the Cardholder.

         2.7      SETTLEMENT OF CARD TRANSACTIONS.

                  (a) REMITTANCE OF SALES DATA BY COMPANY. At least weekly,
Company shall remit Sales Data to Bank. All such remittances must be in Bank's
form and format. Remittances of Sales Data must contain all of the information
specified in this Agreement and the Operating Regulations. Upon receipt thereof,
Bank will balance and edit the data submitted and make appropriate adjustments
for errors or invalid or incomplete transactions. In the event all or a portion
of the required data is not received by Bank or such data is unreadable, Bank
shall not be required to process the Sales Data containing the missing or
unreadable data, but shall promptly inform Company or its designated agent of
the missing or unreadable data. Company shall be responsible for retrieving and
resubmitting the Sales Data in completed form. Company shall be responsible for
the loss, damage or destruction of Sales Data until such Sales Data is received
by Bank or by Bank's designated processor.

                  (b) OBLIGATION TO REIMBURSE COMPANY FOR SALES DATA. Subject to
Bank's right of Chargeback, Bank shall reimburse Company for all Card Sales
properly remitted by Company and received by Bank. Bank will pay Company an
amount equal to the total amount of Card Sales submitted to and received by
Bank, less the amount of Credits, if any, submitted by Company, plus or minus
the applicable amount, if any, for other adjustments to the amounts so
submitted. Bank will not be required to reimburse Company for any Card Sale not
submitted within sixty (60) days of the date of the Card Sale.

                  (c) METHOD AND TIMING OF SETTLEMENT. For each electronic
remittance of Sales Data received in Bank's form and format by 10:00 a.m. local
time on a Business Day at the location specified by Bank, Bank will use its best
efforts to initiate the appropriate credit or debit, as applicable, to the
Settlement Account through the Automated Clearing House Network

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or any other method, including FedWire, as mutually agreed to by the parties
("ACH Network") by the following Business Day. With respect to each such
remittance of Sales Data received by Bank after 10:00 a.m. local time on a
Business Day, Bank will use its best efforts to initiate the appropriate credit
or debit, as applicable, to the Settlement Account through the ACH Network by
the second Business Day after the date of receipt. Bank will not accept
remittance of Card transaction data in paper form (hard copy). Company hereby
(i) agrees to be bound by the terms of the operating rules of the National
Automated Clearing House Association, as in effect from time to time, and (ii)
authorizes Bank and its designated agents and representatives to initiate credit
or debit entries and adjustments to the Settlement Account. Bank shall not be
liable for any delays in receipt of funds or errors in Settlement Account
entries caused by third parties. The following obligations of Company will
survive the termination of this Agreement. Company shall not close the
Settlement Account without providing Bank at least five (5) Business Days prior
written notice of such closure and substitution of another account. Upon
termination of this Agreement, Company agrees to maintain the Settlement Account
with sufficient funds until such time as Bank has processed all Chargebacks and
other adjustments and Company agrees to permit Bank to credit and debit such
Settlement Account until all charges, Chargebacks and other adjustments are
settled as provided for in this Agreement. Company shall be solely liable for
all fees and costs associated with the Settlement Account. This authority will
remain in effect until five (5) Business Days after Bank receives written notice
from Company of its cancellation of such authorization, provided that in the
event of termination of this Agreement, Company agrees to maintain the
Settlement Account with sufficient funds until such time as Company and Bank
agree that all Chargebacks and other adjustments are processed and to permit
Bank to credit and debit such Settlement Account until all charges, Chargebacks
and other adjustments are settled as provided in this Agreement. Bank shall not
be liable to Company for any delays in receipt of funds or errors in credit
entries caused by Company or by third parties including, but not limited to, a
clearinghouse, Company's financial institution, or any agent of Company.

         2.8 CARDHOLDER CREDITS AND PAYMENTS. Unless specifically required by
law, Company shall not give cash refunds to any Cardholder in connection with a
Card Sale. For each Credit issued by Company, Company shall prepare and deliver
to the Cardholder a Credit Slip which Company shall complete in accordance with
the Operating Regulations. Company shall submit Sales Data evidencing each
Credit to Bank within seven (7) days after the Credit is issued in order that
the appropriate Credit may be entered on the Cardholder's Account. Company shall
be permitted to receive Cardholder payments to Bank at Company's retail
establishments.

         2.9 BILLING INQUIRIES AND CARDHOLDER DISPUTES. Bank will notify Company
on a current basis when a Cardholder has made a billing inquiry or filed a
billing error notice relating to a Card Sale made by Company. Company agrees to
investigate and make a good faith effort to resolve each billing inquiry or
dispute referred to it by Bank or received directly from a Cardholder. Within
fifteen (15) Business Days from the date Bank sends a billing inquiry or dispute
to Company, Company shall notify Bank in writing of the resolution thereof or
the action Company will take to resolve the billing inquiry or dispute. Company
shall provide Bank with all such information as Bank may reasonably request in
connection therewith.

         2.10     CHARGEBACK RIGHTS AND PROCEDURES.

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                  (a) CHARGEBACK RIGHTS. If Company has not complied with the
terms of this Agreement or with the Operating Regulations with respect to either
the opening of Accounts or a Card Sale made by Company, or if, at the end of the
fifteen (15) Business Day billing inquiry/dispute resolution period specified in
Section 2.9 of this Agreement, the billing inquiry or dispute is not resolved
(or Bank has not been informed of the resolution or the action Company will take
to resolve the billing inquiry or dispute), Bank may process a Chargeback to
Company for the amount of the Card Sale, the Account balance or the disputed
portion thereof, as applicable. If Bank processes a Chargeback and the disputed
amount is subsequently paid by the Cardholder, Bank will reimburse Company for
the disputed amount.

                  (b) METHOD OF RECOURSE. Bank is not required to pay Company
for a Card Sale which is being charged back. If Bank has already paid Company
for such Card Sale, Bank, at its sole discretion, may deduct the amount to be
charged back from the Settlement Account or offset such amount from a future
payment to Company. Any Chargebacks which are not paid by the aforesaid means
shall be due and payable by Company promptly on demand.

                  (c) COMPLIANCE WITH LAWS. Notwithstanding anything to the
contrary contained herein, in the event a Cardholder, in accordance with the
provisions of applicable state law or the federal Truth in Lending Act and
Regulation Z, as they may be amended from time to time, files with Bank a
billing error inquiry or alleges a quality dispute with respect to goods or
services purchased from Company, Bank has the right of Chargeback against
Company with respect to the Card Sale which is the subject of such inquiry or
dispute.

                  (d) EXCESSIVE CHARGEBACKS. If Chargebacks exceed 1.5% of the
total number of Card Sales submitted by Company with respect to an individual
Company Store in any calendar quarter, Bank reserves the right to assess, and
Company agrees to pay, a fee of $7.50 for each Chargeback in excess of the 1.5%
limit.

                  (e) NON-RECEIPT OF AUTHORIZED GOODS OR SERVICES. Bank may
offset from the Settlement Account the amount of any loss incurred by Bank which
results from a claim by a Cardholder that he or she did not receive a purchase
and receipt of such purchase is not evidenced by a valid cardholder's signature,
and was billed to the Cardholder's Account.

         2.11     REPRESENTATIONS AND WARRANTIES. Company makes the following
representations and warranties to Bank with respect to each Account, all Sales
Data remitted to Bank, and as to each Card transaction evidenced thereby. Each
and all of the representations and warranties made by Company will survive the
termination of this Agreement.

                  (a) The information set forth on each Application is accurate
and correct to the best of Company's knowledge, as provided by the applicant and
each Application has been completed in compliance with this Agreement and the
Operating Regulations.

                  (b) The Sales Data represents a bona fide sale made at a Store
or on the Internet by Company of Authorized Goods and Services, not previously
submitted and is originated by Company in compliance with this Agreement and the
Operating Regulations.

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         2.12     REPORTS. Bank shall supply Company with monthly report(s)
containing information regarding the Card program. Company may elect to receive
additional reports available from Bank at Bank's then current price for such
reports.

                               ARTICLE III - FEES

         3.1      FEES.

                  (a) For each Card Sale made by Company, Bank shall charge and
Company agrees to pay a fee in the amount set forth in Schedule E (the "Merchant
Fee"), which Merchant Fee will be subject to adjustment as provided herein and
in Schedule E. In addition, for each Card Sale made by Company on a Second Look
Account, Bank shall charge and Company agrees to pay to Bank a fee (in addition
to the Merchant Fee) in the amount set forth in Schedule E for each particular
card plan ("Supplemental Merchant Fee"). The Merchant Fee and Supplemental
Merchant Fee will be calculated in accordance with Section 3.1(c) of this
Agreement. Bank shall have the right to adjust the Merchant Fee and the
Supplemental Merchant Fee, upon not less than thirty (30) days prior written
notice to Company; provided, however, that Bank shall not adjust the Merchant
Fee more than one (1) time nor more than fifty (50) basis points in any twelve
(12) month period and that during the Initial Term, such Regular Revolving Plan
Merchant Fee shall not exceed 4.5%, net any adjustments to such fee based on
changes in the Prime Rate as provided in this Section 3.1(a). The Bank shall
provide Company with the reasons for any adjustments to the Merchant Fee at the
time such adjustments are made. The Assumptions upon which the Card Program is
based, are set forth in Schedule B. In addition, Merchant Fees are subject to
adjustment by Bank for changes in the Prime Rate as published in the "Money
Rates" section of THE WALL STREET JOURNAL.

                  (b) For each electronic remittance of Sales Data made to Bank
in accordance with Section 2.7(c) of this Agreement, Bank will determine the
amount of Card Sales made by Company and then calculate and collect the Merchant
Fee based on that amount.

                  (c) Bank may offset the amount of the Merchant Fee and any
other amounts owed by Company under this Agreement from the Settlement amount
due Company, or Bank may debit the Settlement Account in the amount of the
Merchant Fee and any other amounts owed by Company under this Agreement. If Bank
elects the former and the Settlement amount due Company is insufficient to cover
the Merchant Fee and any other amounts owed under this Agreement, Bank, at its
option, may offset the amounts owed under this Agreement or any remaining
portion thereof from subsequent amounts due Company or debit the Settlement
Account. Any amounts owed which cannot be paid by the aforesaid means shall be
due and payable by Company on demand.

                           ARTICLE IV - MISCELLANEOUS

         4.1      INDEMNIFICATION.

                  (a) INDEMNIFICATION BY COMPANY. Company shall be liable to and
shall indemnify, defend and hold harmless Bank and its officers, employees and
directors from any

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losses, damages, claims or complaints (including reasonable outside attorney's
fees and disbursements) incurred by Bank or its respective officers, employees
and directors arising out of:

                           (i)    Any claim, complaint or setoff made by or on
                  behalf of a Cardholder with respect to Card Sales or Credits
                  submitted by Company pursuant to this Agreement;

                           (ii)   Anything wrongfully done or not done by
                  Company in connection with the furnishing of any Authorized
                  Goods and Services purchased by Cardholders pursuant to this
                  Agreement;

                           (iii)  The death or injury to any person or the loss,
                  destruction or damage to any property arising out of the
                  furnishing by Company of any Authorized Goods and Services
                  purchased with the Card;

                           (iv)   Any claim or complaint of a third party in
                  connection with the use of any Company Mark on the Card or in
                  advertising, marketing, promoting or administering the Card
                  program and Card Plan;

                           (v)    Any breach by Company of an obligation under
                  this Agreement;

                           (vi)   Any Card transaction that does not represent
                  obligations of the Cardholder for the amounts in the
                  transaction and is not only for Authorized Goods and Services
                  actually sold and delivered or actually rendered (including
                  taxes) and does not involve any element of credit for any
                  other purpose.

                           (vii)  Any Sales Data that has been altered by
                  Company in any way that is not authorized by the Cardholder.

                           (viii) Any transaction that is not in compliance
                  with all applicable law except if same results from an act or
                  omission by Bank.

                           (ix) Any indebtedness represented by the Sales Data
                  that is pledged as collateral for payment of any indebtedness
                  or obligation of Company or any other person.

                           (x) Any knowledge or notice of information that
                  Company has that would lead it to believe that the
                  enforceability or collectibility of the Sales Data is in any
                  manner impaired.

                           (xi) With respect to any transaction in which a Card
                  is not physically presented to Company, any Card and Account
                  information contained in the Sales Data that is not accurate
                  and correct.

                  (b) INDEMNIFICATION BY BANK. Bank shall be liable to and shall
indemnify,

                                       12
<PAGE>

defend and hold harmless Company and its officers, employees and directors from
any losses, damages, claims or complaints (including reasonable outside
attorney's fees and disbursements) incurred by Company or its officers,
employees and directors arising out of any claim or complaint by a Cardholder
with respect to anything wrongfully done or not done by Bank in connection with
such Cardholder's Account. Notwithstanding the foregoing, the indemnification by
Bank shall not apply to any claim or complaint relating to Company's failure to
resolve a billing inquiry or dispute with a Cardholder.

                  (c) NOTICE OF CLAIM. If any claim is made or any suit or
action is commenced against the indemnified party in respect of which
indemnification may be sought under this Section 4.1, the indemnified party
shall promptly give the indemnifying party written notice thereof and the
indemnifying party will be entitled to assume the defense thereof and to take
over and control the settlement thereof (with counsel satisfactory to the
indemnified party) at the indemnifying party's cost and expense by giving
written notice of its intention to do so to the indemnified party within thirty
(30) days after receipt by the indemnifying party of notice of the claim, suit
or action. If the indemnifying party assumes the defense of any claim, suit or
action, it shall not settle such claim, suit or action unless the indemnified
party consents to such settlement. Notwithstanding the assumption by the
indemnifying party of the defense of any claim, suit or action, the indemnified
party will be permitted to join in the defense thereof and to employ counsel at
its own cost and expense. If the indemnifying party fails to notify the
indemnified party of its desire to assume the defense of any claim, suit or
action or notifies the indemnified party that it will not assume the defense
thereof, then the indemnified party may assume the defense thereof, at the
indemnifying party's cost and expense. Any settlement or compromise of, or any
final judgment entered on or in, any claim, suit or action which the
indemnifying party declines to defend in accordance with this Agreement, will be
deemed to have been consented to by, and will be binding upon, the indemnifying
party as fully as if the indemnifying party had assumed the defense thereof and
a final judgment or decree had been entered in such suit or proceeding, or with
regard to such claim, by a court of competent jurisdiction for the amount of
such settlement, compromise, judgment or decree. In any case, the indemnifying
party and the indemnified party shall cooperate (at no cost to the indemnified
party) in the settlement or defense of any such claim, suit or action.

                  (d) PAYMENT OF INDEMNIFIED AMOUNTS. The indemnified party
shall notify the indemnifying party of any amounts due and owing by the
indemnifying party under this Section 4.1 and the indemnifying party shall pay
such amounts to the indemnified party within thirty (30) after receipt of such
notice.

                  (e) SURVIVAL. Except for this Section 4.1 and Sections 2.7,
2.11 and 4.7, no other terms of this Agreement will survive the termination of
this Agreement.

         4.2      CARD PLAN PROMOTION; ADVERTISING AND SERVICE MARKS.

                  (a) LIMITED LICENSE. Company hereby authorizes Bank for
purposes of this Agreement to use Company Marks on the Card and in advertising,
marketing, promoting and administering the Card program and Card Plan, subject
to Company's periodic reasonable review of such use and to Company's reasonable
specifications directly related to the legal maintenance of Company Marks. In
addition, Company authorizes Bank and Bank's affiliates to

                                       13
<PAGE>

identify Company as a client in advertising and promotional material, and to use
pictures or representations of the Card.

                  (b) PROMOTION OF THE CARD PLAN. Company shall actively and
         consistently promote, participate in and support the Card program and
         Card Plan throughout the term of this Agreement. Company shall
         prominently display at each of its Stores advertising and promotional
         materials relating to the Card Plan, including without limitation,
         take-one Applications for the Card. Further, Company shall advertise
         and promote the Card Plan at least to the same extent as it advertises
         and promotes the most favored of other credit cards, charge cards or
         credit plans. Company shall only use or display promotional materials
         relating to the Card Plan in accordance with the Operating Regulations
         and in accordance with any specifications provided by Bank. Company
         shall use and distribute Required Disclosures, as such may change from
         time to time, in accordance with Bank's requirements. Bank and Company
         agree to cooperate in the development of advertising, marketing, and
         promotional materials (in any media form), as well as operating forms
         and other materials which promote the Card and any Card related
         programs (collectively or individually, the "Promotional Materials").
         Company acknowledges and agrees that it will present all Promotional
         Materials to Bank, in writing, for Bank's review and written approval
         as follows:

                           (i) Company will deliver Promotional Materials to
                  Bank at least five (5) Business Days prior to the last date
                  upon which preliminary changes can be made to such materials.
                  Company will allow itself sufficient time to make changes as
                  required by Bank including time to provide Bank with the
                  revised Promotional Materials for Bank's review and written
                  approval before such materials are utilized.

                           (ii) Company will deliver Promotional Materials in
                  the form and/or format media as they are intended to be
                  utilized. Non-printed Promotional Materials shall be
                  accompanied by a written transcript.

                           (iii) Company acknowledges and agrees not to use,
                  publish, or distribute (in any media form) any Promotional
                  Materials without the prior written approval of Bank.

                           (iv) Notwithstanding anything else to the contrary
                  herein, (1) Company will be solely responsible for, and will
                  indemnify Bank (subject to Section 4.1(a)) against, any claim
                  and any expense incurred by Bank as a result of Company's use
                  of materials not approved by Bank in accordance with the terms
                  of this Section 4.2; and (2) Bank will have the option to
                  terminate this Agreement immediately if Bank reasonably
                  believes that Company's failure to comply with the terms of
                  this Section 4.2 places Bank at risk.

                  (c) CARDHOLDER SOLICITATION. For purposes of mutually agreed
upon solicitations for prospective Cardholders, Company shall provide Bank with
its customer lists and any other lists of consumers that Company owns or has a
right to use. Bank and Company

                                       14
<PAGE>

shall mutually agree upon plans for solicitation of Company's customers. Company
shall be responsible for the costs of providing such lists and any solicitations
which may be mutually agreed upon by Bank and Company. Any such Cardholder
solicitations of Company's customers or any other consumers by Bank shall be in
accordance with Bank's policies and procedures and subject to Bank's credit
analysis and determination. Cardholders' names and addresses are the property of
Bank. Company may use Cardholder names and addresses to conduct promotional
programs for Authorized Goods and Services during the term of this Agreement,
upon notifying Bank in writing prior to such use. Cardholder information may be
used by Bank for such purposes as it chooses so long as Bank does not use such
information in a manner that is injurious to Company's retail business. Bank and
its affiliates may from time to time make the products or services of third
parties available to Cardholders with Company's written approval.
Notwithstanding the foregoing, Bank has the right to solicit Cardholders to
purchase credit insurance four (4) times each calendar year. The dates upon
which such solicitations will occur shall be mutually agreed upon by the
parties.

                  (d) PROMOTIONAL FUNDS. Bank and Company agree to establish a
Promotional Fund for Card promotions and marketing activities related to the
Card Plan ("Marketing Activities"). Bank shall make available $200,000 each
calendar year, including the calendar year 2000, for joint Marketing Activities
for so long as the projected Annual Net Card Sales of Company as projected by
Bank, based upon the previous twelve (12) months Net Card Sales and projected
growth, are greater than or equal to $60,000,000 but less than or equal to
$67,000,000. When Company's projected Annual Net Card Sales are greater than
$67,000,000 but less than or equal to $85,000,000, Bank shall calculate the
contribution to the Promotional Fund as follows: multiply projected Annual Net
Card Sales by .0030. If Company's projected Annual Net Card Sales exceed
$67,000,000 the calculated contribution described in this paragraph will be
provided to the Promotional Fund in place of, not in addition to, the $200,000.
When Company's projected Annual Net Card Sales are greater than $85,000,000 but
less than $150,000,000, Bank shall calculate the contribution to the Promotional
Fund as follows: multiply projected Annual Net Card Sales by .0040. When
Company's projected Annual Net Card Sales are greater than or equal to
$150,000,000, Bank shall calculate the contribution to the Promotional Fund as
follows: multiply projected Annual Net Card Sales by .0045. On a semi-annual
basis, Bank shall review the actual Annual Net Card Sales of Company to
determine whether any adjustments regarding Bank's contribution to the
Promotional Fund are required for the remainder of the calendar year. Bank shall
only contribute to the Promotional Fund, provided Company contributes the same
amount during such period for such purpose. Bank and Company shall mutually
agree, in writing, upon the plans and cost for Marketing Activities prior to the
expenditure of amounts in the Promotional Fund. The party responsible for the
agreed upon Marketing Activity shall provide the funds required for the activity
and invoice the other party for the required contribution. In addition, Bank
shall contribute fifty percent (50%) of all revenue earned by Bank directly from
any fees or commissions paid by vendors whose products or services are sold to
Cardholders using inserts with monthly billing statements, with the exception of
products or services related to credit insurance. Any amounts in the Promotional
Fund that are not used for Marketing Activities during any year of the Initial
Term or any Subsequent Term will be returned to each party at the end of such
period on the same percentage basis as the amounts were contributed by each
party. Any amounts remaining in the Promotional Fund at the termination of this
Agreement will be returned to each party on the same percentage basis as the
amounts were contributed by each party.

                                       15
<PAGE>

         4.3      BOOKS AND RECORDS. Company shall retain an original copy of
each Sales Slip and Credit Slip for one hundred and eighty (180) days following
the date of the Card Sale and a microfilm or other copy thereof for a total of
seven (7) years. Company shall send to Bank the original or a legible copy of
any Sales Slip, Credit Slip or any other record relating to this Agreement
retained by Company within fifteen (15) Business Days of a request from Bank. In
the event of a cardholder dispute pertaining to the Authorized Goods and
Services for which Company does not send Bank the requested information as
described in the Section 4.3, Bank shall Chargeback the amount of such Sale to
Company.

         4.4      TERM AND TERMINATION.

                  (a) TERM. This Agreement will be effective as of July 1, 2000
("Effective Date") when executed by authorized officers of each of the parties.
Subject to earlier termination as provided herein, this Agreement (i) will
remain in effect for a period of five (5) years from the Effective Date
("Initial Term"), and (ii) thereafter will continue for additional three (3)
year periods ("Subsequent Term(s)") unless either party provides written notice
of termination at least one (1) year prior to the end of the Initial Term or any
Subsequent Term. The termination of this Agreement will not affect the rights
and obligations of the parties with respect to transactions and occurrences
which take place prior to the effective date of termination, except as otherwise
provided herein.

                  (b) TERMINATION.  This Agreement may otherwise be terminated:

                           (i) by Bank or Company upon notice to the other in
                  the event the other party elects to wind up or dissolve its
                  operation or is wound up and dissolved; becomes insolvent or
                  repeatedly fails to pay its debts as they become due; makes an
                  assignment for the benefit of creditors; files a voluntary or
                  involuntary petition in bankruptcy or for reorganization or is
                  adjudicated as bankrupt or insolvent; or has a liquidator or
                  trustee appointed over its affairs and such appointment
                  continues for more than thirty (30) days.

                           (ii) by Bank or Company upon notice to the other
                  party in the event (1) the other party fails to comply in any
                  material respect with any representation, warranty, term or
                  obligation under this Agreement; or (2) the other party
                  suffers a material adverse change in its business, financial
                  condition, business practices, products or services.

                           (iii) by Bank or Company upon not less than thirty
                  (30) days notice to the other in the event the other
                  materially breaches its obligations hereunder provided that
                  such termination will be deemed ineffective if the breaching
                  party cures its breach within the thirty (30) day period.

                           (iv) by Bank upon not less than thirty (30) days
                  prior written notice to Company in the event (1) the aggregate
                  Net Card Sales made by Company during any twelve (12) month
                  period decrease by more than twenty percent (20%) from the
                  aggregate Net Card Sales made by Company during the same

                                       16
<PAGE>

                  period of the prior year; or (2) Company or Company's parent
                  sells, merges, consolidates or transfers twenty percent (20%)
                  or more of Company's business or assets without obtaining
                  Bank's prior written consent, as required under Section 4.11
                  of this Agreement.

                           (v) by Company upon six (6) months prior written
                  notice to Bank, if Bank meets three or less of the Performance
                  Standards set forth in Schedule D ("Performance Standards")
                  more than five (5) months in any twelve (12) month period.
                  Such Performance Standards are subject to adjustment by Bank
                  based on changes in the demographics of Company's applicants
                  or economic issues affecting the credit card industry
                  generally. Company shall have the right, upon request, to
                  inspect the books, records or any related source information
                  utilized by Bank for purposes of reporting Performance
                  Standards results to Company. Prior to any such adjustment,
                  Bank shall obtain Company's prior written consent, which
                  consent shall not be unreasonably withheld or delayed.

                  (c) TERMINATION OF CARD ACCEPTANCE. Bank upon notice to
Company may elect to terminate acceptance of the Card at a particular Company
Store if acceptance of the Card at such Store is subject to high fraudulent
activity, excessive Chargebacks (that is, in excess of 1.50% of the total number
of Card Sales) or other course of business conduct that is injurious to the
business relationship between Bank and Company. Termination of Card acceptance
at an individual Company Store will not affect this Agreement unless such
termination materially affects the volume of Card Sales made by Company, in
which event Bank may elect to terminate this Agreement upon not less than thirty
(30) days prior written notice to Company.

                  (d) DUTIES UPON TERMINATION. Upon termination of this
Agreement, all amounts payable by either party shall be due and payable in full
without demand or notice of any kind from the other party and Company shall
promptly submit to Bank all Sales Data for Card transactions made up to the date
of termination. Bank shall cooperate with Company in transferring any necessary
Account data and other relevant data to Company or its designees at Company's
cost, and shall perform its duties hereunder to the best of its ability
notwithstanding such notice of termination.

                  (e) PURCHASE OPTION. If this Agreement is terminated by Bank,
(except under paragraphs 4.4(b)(I), (ii), (iii), (iv), 4.4(c) or 4.11), or by
Company pursuant to its rights of termination under this Agreement, Company
shall, upon at least sixty (60) days prior written notice to Bank, given prior
to the date termination is to be effective, have the right to purchase from
Bank, all of the outstanding Card receivables (subject to the terms of any then
current securitization agreements of Bank) at the then current value as
determined by Bank. In the event that Company does not agree with the current
value as determined by Bank, the parties shall retain the services of a
designated third party which shall be an agreed upon independent public
accounting firm that is one of the five (5) largest recognized public accounting
firms. The agreed upon third party shall conduct the appraisal in accordance
with generally accepted appraisal standards as promulgated by the American
Society of Appraisers. The expense of such appraisal by such third party shall
be paid by Company. Bank and Company agree to

                                       17
<PAGE>

provide the designated third party access to information reasonably necessary to
assist in the valuation. Such information shall be deemed confidential provided
that Company may share such valuation with a bona fide prospective purchaser,
provided that such prospective purchaser first executes a confidentiality
agreement provided by Bank. The purchase shall be under such terms and
conditions that are mutually acceptable to Bank and Company, provided that Bank
shall not be required to accept as the purchase price less than 101% of the
value of all of the outstanding Card receivables as of the effective date of the
termination and that this Agreement shall remain in effect until such purchase
is consummated. In the event that Company does not purchase the outstanding Card
receivables as provided in this Section 4.4(e), Bank shall have the right to use
such Card receivables in any manner Bank deems appropriate, provided however;
during the eighteen (18) months immediately following the date termination is
effective, Bank shall not sell such receivables to a third party that is
engaged, as its primary business, in any business that directly competes with
Company's primary business.

         4.5 RESERVE ACCOUNT. If any event arises that would be a basis for
termination of this Agreement by Bank under paragraph 4.4(b)(i), Bank may
immediately establish a reserve account ("Reserve") against potential liability
to Cardholders for Credits and refunds for advance Card Sales. The amount of
such Reserve shall be determined by Bank based on Company's Chargeback history.
Company shall immediately pay to Bank the amount of such Reserve, or Bank may
debit the Settlement Account or withhold Settlement until the Reserve is fully
funded. Company agrees that Bank may set off against the Reserve any Credits,
Chargebacks or adjustments that Company does not or is unable to satisfy through
Settlement. Bank will release all remaining amounts held in the Reserve not
later than two hundred ten (210) days after the termination date of this
Agreement, upon satisfaction of all Company's obligations to Bank. Bank will
provide Company with an accounting of any amounts withdrawn from the Reserve.

         4.6 STATUS OF THE PARTIES. In performing their responsibilities
pursuant to this Agreement, Bank and Company are in the position of independent
contractors. This Agreement is not intended to create, nor does it create and
shall not be construed to create, a relationship of partner or joint venture or
an association for profit between Bank and Company. Further, notwithstanding
anything to the contrary contained in this Agreement, any third party designated
by Company to perform obligations or functions of Company under this Agreement,
including without limitation, obtaining Authorization or performing data
capture, remittance or Settlement functions, will be subject to the approval of
Bank and will be deemed to be the agent of Company for all such purposes and not
the agent of Bank and Company shall be fully liable for the fees and actions of
any such third party with respect to the performance of such functions.

         4.7 FORCE MAJEURE. Neither party to this Agreement will be liable to
the other by reason of any failure in performance of this Agreement in
accordance with its terms if such failure arises out of causes beyond the
control and without the fault or negligence of such party. Such causes may
include, but are not limited to acts of God or of the public enemy, acts of
civil or military authority, fires, strikes, unavailability of energy resources,
delay in transportation, riots or war. In the event of any force majeure
occurrence, the disabled party shall use its best efforts to meet its
obligations as set forth in this Agreement. The disabled party shall promptly
and in writing advise the other party if it is unable to perform due to a force
majeure event, the expected duration of such inability to perform, and of any
developments (or changes therein) that appear likely to affect the ability of
that party to perform any of its obligations hereunder in

                                       18
<PAGE>

whole or in part.

         4.8 CONFIDENTIALITY. In performing its obligations under this
Agreement, each party may have access to and receive certain confidential or
proprietary information about the other party, including, but not limited to:
such party's marketing philosophy and objectives, competitive advantages and
disadvantages, Cardholder and customer names and addresses, financial results,
technological development, Store locations, sales volume(s), merchandise mix or
other information of the business or affairs of each party, its parent company,
or its affiliated and subsidiary companies, which that party reasonably
considers confidential and/or proprietary (collectively referred to as
"Confidential Information"). Each party agrees that it will reveal such
Confidential Information only to those of its directors, officers, employees
(or, with regard to Company, directors, officers or employees of any of its
operating divisions/subsidiaries which accept or may consider accepting the
Card, and, with regard to Bank, directors, officers, employees of Bank, or its
affiliates which are involved in the development of the Card program and Card
Plan) who are engaged in the implementation of policies, programs or procedures
with regard to the acceptance of the Card by Company. Each party agrees not to
use such Confidential Information nor to disclose Confidential Information to
any third party, except as may be necessary for that party to perform its
obligations pursuant to this Agreement and except as may be agreed upon by the
parties. If either should disclose Confidential Information to a third party,
such party shall cause said third party to agree to the confidentiality
provisions set forth in this Section 4.8.

         Confidential Information does not include information in the public
domain, information already known by the party receiving the information prior
to commencing the discussions that led to this Agreement, and information
lawfully obtained from a third party. The terms of this Section 4.8 will survive
the termination of this Agreement.

         4.9 ACCESS TO CARDHOLDER LIST. Company may request, on a monthly basis,
from Bank the names and addresses of Cardholders who have opened Accounts at
Stores. With respect to any request more frequently than once per calendar
month, Bank will charge and Company agrees to pay a fee in the amount set forth
in Schedule A. Company may only use such Cardholder information in connection
with sales promotions of Authorized Goods and Services or Company may sell such
information to a third party that is mutually agreed upon by Bank and Company
provided such third party is not engaged in a business that competes either
directly or indirectly with any business that either Bank or Company or any of
their affiliates may be engaged in. Bank and Company agree to share equally in
any revenue generated by the sale or use of the Cardholder list to a third party
as provided in this Section 4.9. Except as specifically provided herein, during
the term of this Agreement any other use of such Cardholder information by
Company including, without limitation, the disclosure or sale of such
information to third parties, is prohibited and is subject to the
confidentiality provisions of Section 4.7 of this Agreement.

         4.10 FINANCIAL INFORMATION. At least annually, upon written request by
Bank, Company shall provide to Bank audited financial statements prepared for
Company by an independent public accounting firm. Quarterly, upon written
request by Bank, Company shall provide to Bank quarterly financial statements
prepared by or for Company.

                                       19
<PAGE>

         4.11 ASSIGNABILITY; SUCCESSORS AND ASSIGNS. This Agreement and any of
the rights, interests and obligations of either of the parties hereunder may be
assigned to a parent, subsidiary, or affiliate of either party, provided that
any such assignee shall have as of the date of assignment a financial net worth
equal to or greater than the assigning party as of the Effective Date. Bank may
assign this Agreement to a third party upon the sale of all or substantially all
of its assets or stock to such third party. This Agreement may not otherwise be
assigned without the prior written consent of the non-assigning party, which
consent shall not be unreasonably withheld or delayed. The rights and
obligations of the parties hereto will inure to the benefit of and will be
binding upon the successors and permitted assigns of each of them. Company shall
notify Bank and obtain Bank's written consent before Company or its parent
corporation, if any, is purchased by another entity or agrees to merge or be
consolidated into or transfer all or substantially all of either of their
respective assets to another entity.

         4.12 AMENDMENT. Except as otherwise provided herein, neither this
Agreement nor any of its provisions will be amended or modified except in
writing executed by a duly authorized officer of each party.

         4.13 SEVERABILITY. If any provision, or portion thereof, of this
Agreement is held invalid, illegal, void or unenforceable by reason of any rule
or law, administrative order, judicial decision or public policy, all other
provisions of this Agreement will nevertheless remain in full force and in
effect.

         4.14 ENTIRE AGREEMENT. This Agreement, including the Operating
Regulations and any schedules, exhibits and documents referenced herein,
constitutes the entire agreement between the parties in connection with the Card
program and Card Plan and supersedes all prior agreements, supplements,
negotiations and communications on such subject matter.

         4.15     GOVERNING LAW.  This Agreement will be governed by and
construed in accordance with the laws of the State of South Dakota.

         4.16 APPLICABLE LAW OR REGULATION. It is expressly understood that
changes in the performance of either party's obligations under this Agreement
necessitated by a change in interpretation of any applicable federal or state
statute or regulation will not constitute a breach of this Agreement.

         4.17 WAIVERS. Neither party will be deemed to have waived any of its
rights, powers or remedies under this Agreement unless such waiver is approved
in writing by the waiving party.

         4.18 NOTICES. Whenever notice or demand under this Agreement is given
to or made upon either party by the other party, such notice or demand must be
given in writing, either (i) by depositing it in the United States mail
addressed to such party at its address as set forth below, with postage thereon
prepaid, and any notice or demand so mailed will be deemed to have been given at
the time when it was mailed, or (ii) by courier, telecopier, or similar method,
and such notice or demand will be deemed to have been given when the writing or
other form of notice or demand is either personally delivered to the party or
delivered to the address set forth below. Notwithstanding the foregoing, notice
of intent to terminate this Agreement and notice of default must be sent by
certified or registered mail, return receipt requested.

                                       20
<PAGE>

If to Bank:                         Hurley State Bank
                                    1503 East 10th Street
                                    Sioux Falls, South Dakota  57103
                                    Attn:  Senior Vice President

With a copy to:                     Associates Commerce Solutions, Inc.
                                    Four Parkway North
                                    Deerfield, Illinois  60015
                                    Attn:  Vice President - Controller

If to Company:                      The Children's Place Retail Stores, Inc.
                                    915 Secaucus Road
                                    Secaucus, New Jersey 07094
                                    Attn: CFO

With a copy to:                     The Children's Place Retail Stores, Inc.
                                    915 Secaucus Road
                                    Secaucus, New Jersey  07094
                                    Attn: General Counsel

         EITHER PARTY MAY CHANGE THE ADDRESS TO WHICH NOTICE MUST BE SENT BY
GIVING WRITTEN NOTICE OF SUCH CHANGE TO THE OTHER PARTY IN THE MANNER PROVIDED
HEREIN.

         4.19 NO THIRD-PARTY RIGHTS. Nothing in this Agreement shall create or
be deemed to create any third-party beneficiary rights in any person not party
to this Agreement.

         4.20 CAPTIONS. The captions used in this Agreement have been inserted
for convenience and for reference only and will not be deemed to limit or define
the text of this Agreement.

         4.21 COUNTERPARTS. This Agreement may be executed in separate
counterparts, each of which will constitute an original but all of which will
constitute one and the same Agreement.

         IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first written above.

THE CHILDREN'S PLACE RETAIL                   HURLEY STATE BANK
STORES, INC.                                  (Accepted at its Home Office)

By:    /s/   Steven Balasiano                 By:    /s/   Phil Layher
       -----------------------------------       -------------------------------

Title:  Vice President and General Counsel    Title:  Senior Vice President
        ----------------------------------            --------------------------

                                       21
<PAGE>

                                   SCHEDULE A

                                      FEES

<TABLE>
<CAPTION>
                                    ITEM                                               AMOUNT
                                    ----                                               ------
<S>        <C>                                                                   <C>
1.         In-store forms, including Applications,                               Cost plus handling
           point-of-sale forms, Sales Slips and Credit Slips with
           the exception of changes to any of the forms in this
           paragraph initiated by Bank

2.         Each tape file of Cardholder names and addresses                      $150.00 per request
           in excess of one (1) per month

3.         System changes requested by Company                                   At Bank's cost

4.         Business reply mail and special handlings                             Pass-through costs
                                                                                 and Expenses
</TABLE>

                                       22
<PAGE>

                                   SCHEDULE B

                                   ASSUMPTIONS

<TABLE>

<S>        <C>                                                 <C>

1.         Account Application volume                          314,300 Applications each year

2.         Account Application processing                      100% of Applications* that are
                                                               processed at the point of sale for
                                                               submission through remote entry
                                                               application processing

3.         New Account activation rate                         85%

4.         Average number of Card Sales per
           Active Account each year                            4

5.         Average annual Card Sales per Active Account         $300

6.         Average amount of each Card Sale ticket              $78 for first purchase
                                                                $56 for subsequent purchases

7.         Percentage of aggregate regular revolving
           credit Account balances that incur finance charges   79%

8.         Minimum annual percentage rate applicable to
           Accounts                                             21.96%

9.         Average outstanding balance per Active Account       $135

10.        Aggregate Net Card Sales by Company under
           the Card program                                     $64,000,000

11.        Annual net charge-off rate                           Not to exceed 8.0% during the first
                                                                year of the Initial Term

12.        Special Credit Plan Card Sales Volume                Less than ten percent (10%) of total
                                                                Net Card Sales in any twelve (12)
                                                                month period
</TABLE>

  * provided that Bank's processing system is available by remote entry.

                                       23
<PAGE>

                                   SCHEDULE C

                                  COMPANY MARKS

                                       24
<PAGE>

                                   SCHEDULE D

                              PERFORMANCE STANDARDS

  1.  Monthly Average Speed of Answer for New Accounts:            40 seconds

  2.  Monthly Average Speed of Answer for Phoned-In
      Authorizations:                                              35 seconds

  3.  Monthly Average Speed of Answer for Customer Service:        50 seconds

  4.  Monthly Average Abandon Rate:                                5%

  5.  Minimum Year-To-Date Average Approval Rate:                  50%

                                       25
<PAGE>

                                   SCHEDULE E

  MERCHANT FEE

  1.       Regular Revolving Plan:

  Bank shall charge and Company agrees to pay a Merchant Fee equal to 3.49% of
  the Net Card Sale. On or around January 1, of each calendar year for the
  Initial Term and any Subsequent Terms, Bank shall adjust the Merchant Fee for
  the immediately following calendar year according to the chart below. Such
  adjustments shall be based on Net Card Sales for the immediately preceding
  calendar year.

  PREVIOUS CALENDAR YEAR NET CARD SALES                     MERCHANT FEE
  -----------------------------------------------           ------------
  $         0.00            -         85,000,000               3.49%
  $         85,000,001      -        115,000,000               3.24%
  $        115,000,001      -        150,000,000               2.99%
  $        150,000,001      -        175,000,000               2.74%
  $        175,000,001      +                                  2.49%

  2.       Special Credit Plans:
           90 Days Same As Cash               Current Merchant Fee plus 2.46%
                          WITH A $150 MINIMUM PURCHASE

Supplemental Merchant Fees

  For each Card Sale made on a Second Look Account, the Bank shall charge and
  Company agrees to pay, in addition to the Merchant Fee set forth above, a
  Supplemental Merchant Fee of 4.00% of each Net Card Sale.

                                       26
<PAGE>

                                    EXHIBIT A

                                HURLEY STATE BANK
                              OPERATING REGULATIONS

                                                                 REVISED 7/30/99

1001     COMPANY SERVICE CALLS

         Bank, directly or through its servicer will staff a service department
         to handle all new Accounts, Authorization and Cardholder inquiries. The
         service department will handle Cardholder inquiries from 9:00 a.m. to
         5:00 p.m. (local time), Monday through Friday, on all Business Days.

1002     CARD LOGO

         Company will properly display the appropriate Card logo on promotional
         materials to inform the public that the Card will be honored at
         Company's place(s) of business. Use of decals, signs, and print and
         broadcast materials which bear the Card logo must comply with the
         specifications provided to Company. Company may use the Card logo or
         the Card name or representations thereof, on promotional, print or
         broadcast materials to indicate that the Card is accepted. All
         advertisements for the Card Plan or promotional uses of the Card must
         be done in accordance with the Merchant Services Agreement.

1003     ALTERED AND COUNTERFEIT CARDS

         Company's employees and representatives should be familiar with the
         appearance of a valid Card and the validity of Card Account numbers as
         issued by Bank and must check each Card and Card Account number
         presented for signs of counterfeiting or alterations. Company's
         employees and representatives should exercise reasonable care in
         checking each Card and Card Account number. Bank may issue a Chargeback
         if Company's employees or representatives process a Card Sale with
         invalid Cards or Card Account numbers. [Chargeback Code: 19]

1004     PREPARATION OF SALES SLIP AND CREDIT SLIP

         Company's employees and representatives must provide the Cardholder
         with a completed copy of the Sales Slip or Credit Slip at the time of
         each completed Card transaction. For purchases made over the telephone,
         via Company's Internet website or through Company's catalog, if
         applicable, Company's employees and representatives must provide the
         Cardholder with a completed copy of the Sales Slip or Credit Slip with
         the merchandise. Sales Slips or Credit Slips must contain the following
         information:

         1.     The Cardholder's Account number.
         2.     Company's name and store location (city/state).

                                       27
<PAGE>

         3.     The description of merchandise or service purchased.
         4.     The total amount of the transaction (including sales tax).
         5.     The transaction date.
         6.     The Cardholder's signature. (For telephone orders, Internet
                order, facsimile orders and mail orders without the Cardholder's
                signature must designate the words "phone order", "Internet
                order," "fax order" or "mail order" in the signature block.) The
                signature block must never be left blank.
         7.     Authorization code.
         8.     For credits, original sales date and reason for refund.
         9.     Company's Merchant Account number.
         10.    "Ship to" address, if applicable.

1005     AUTHORIZATION REQUIREMENTS

         Company will inform its franchisees, participating merchants,
         licensees, independent marketers or dealers, if any, that Cardholders
         may only use their Account or the Card for personal, family, household
         and charitable purposes. Bank may issue a Chargeback if Company's
         employees or representatives process a Card Sale in violation of the
         above stated consumer use. [Chargeback Code: 20]

         Bank, directly or through its servicer will provide Authorization
         services to Company's locations located within the United States.
         Company's employees and representatives will obtain an electronic
         Authorization using a point-of-sale terminal certified by Bank or its
         servicer. In the event Authorizations cannot be obtained
         electronically, each Operations Center will provide telephone
         Authorizations through the Authorization department. Bank will advise
         Company of the Authorization department's business hours. Company's
         employees and representatives must enter the following information into
         the terminal for electronic Authorization:

         1.     The Cardholder's Account number.
         2.     The total amount of the transaction (including sales tax).

         If Company's employees and representatives cannot obtain an electronic
         Authorization, Company's employees and representatives must obtain
         Authorization by telephone from the Authorization department, and must
         provide the following information to the Authorization department:

         1.     The Cardholder's Account number.
         2.     The total amount of the transaction (including sales tax).
         3.     Company's merchant account number.
         4.     Credit Plan number, if applicable.

         Company's employees or representatives must enter the above information
         into the terminal and include the Authorization code provided by the
         Authorization department.

1006     REQUEST FOR NEW ACCOUNT AT POINT-OF-SALE

                                       28
<PAGE>

         For applications taken at Company's retail locations the applicant must
         complete the application in its entirety, and sign the application.
         Both applicants must sign the application if it is a request for a
         joint Account. Company's employees or representatives must provide a
         copy of the Hurley State Bank Cardholder Agreement (the "Cardholder
         Agreement") to the applicant. If Company's employees or representatives
         fail to provide a copy of the Cardholder Agreement at the
         point-of-sale, Bank may issue a Chargeback if: (i) the applicant
         challenges or disputes the terms of the Cardholder Agreement and
         alleges that he/she did not receive the Cardholder Agreement, and (ii)
         Bank is unable to enforce collection because Company's employees or
         representatives allegedly failed to provide the Cardholder with a copy
         of the Cardholder Agreement. [Chargeback Codes: 10, 21]

         Company's employees or representatives must ask the applicant (both
         applicants if a Joint Account) for two (2) pieces of identification to
         verify the applicant's identity. For applicants residing in all states
         or territories except New Jersey, the first piece of identification
         must have the applicant's picture on it and must be a valid (as
         hereinafter defined) driver's license, state-issued I.D., military
         I.D., resident alien card or voter registration card. For purposes of
         this paragraph, the term "valid" means (i) that the applicant must be a
         resident of the state for which the identification was issued, if
         applicable; (ii) the address on the identification must match the
         address on the application unless the applicant has represented on the
         application that he/she has lived at the place of residence listed on
         the application for six (6) months or less; and (iii) the
         identification must not have expired. The second piece of
         identification can be any other form of identification that identifies
         the applicant, contains the applicant's signature and contains
         information that is consistent with the information on the first piece
         of identification. For applicants residing in the state of New Jersey,
         the first piece of identification must be a valid driver's license,
         state-issued I.D., military I.D., or resident alien card. The second
         piece of identification can be any other form of identification that
         identifies the applicant, contains the applicant's signature and
         contains information that is consistent with the information on the
         first piece of identification. If the second form of identification is
         a credit card, Company's employees or representatives cannot write down
         such credit card number. Company's employees or representatives must
         then compare the pictures, if applicable and signatures on the forms of
         identification with the applicant and the applicant's signature. If
         Company's employee or representative fails to obtain and verify the
           appropriate identification, Bank may issue a Chargeback if Bank is
         unable to enforce collection due to Company's employee's or
         representative's alleged failure in obtaining and verifying the
         appropriate identification. [Chargeback Code: 22]

         Then, the following procedure will be utilized:

         1.     Bank's New Accounts associate will request verification of
                signature and I.D. information. If the application is processed
                through Remote Entry Application Process (REAP), Company's
                employees or representatives must verify signature and I.D.
                information. In addition, Bank may require additional
                information from the store associate such as the form number of
                the application that the applicant filled out.

                                       29
<PAGE>

         2.     Company's employee or representative will be prompted to provide
                the required information contained in the application, and the
                total amount of the sale including applicable sales tax and any
                service, shipping, warranties, and handling costs.

         3.     If approved, Bank's New Accounts associate will provide the
                Account number and credit limit to Company's employee or
                representative. In order to obtain Authorization for the Card
                Sale, Company's employee or representative must enter the
                Account number and total amount of the Card Sale into the
                point-of-sale terminal.

         4.     If Bank declines an application or is unable to render an
                immediate decision, Bank will provide Company's employee or
                representative with an application pending number that Company's
                employee or representative must place in the designated area on
                the application. Company's employee or representative must then
                advise the applicant that Bank will notify the applicant of the
                final decision by mail.

                If the total amount of the Card Sale exceeds the line of credit
                offered to the applicant, Bank's associate will communicate the
                Bank's counteroffer for a lower line of credit to Company's
                employee or representative, who must communicate it to the
                applicant. Bank will provide Company's employee or
                representative with an application pending number to place in
                the designated area on the application. Company's employee or
                representative must then notify Bank's associate of the
                applicant's decision to accept or decline the counteroffer for a
                lower line of credit within twenty-four (24) hours of the
                initial credit offer. If the applicant declines the
                counteroffer, Company's employee or representative must treat
                the application as if Bank declined the application.

         5.     EACH COMPANY'S LOCATION MUST SEND ALL APPROVED, DECLINED OR
                PENDING APPLICATIONS, INCLUDING THE INFORMATION CONTAINED IN
                THOSE APPLICATIONS RECEIVED BY TELEPHONE, TO THE DESIGNATED
                CARD OPERATIONS CENTER ON A WEEKLY BASIS AND INCLUDE ALL
                APPLICATIONS IN THE SAME ENVELOPE. IF BANK DOES NOT RECEIVE
                THE APPLICATIONS ON A WEEKLY BASIS, BANK MAY ISSUE A
                CHARGEBACK FOR THESE ACCOUNTS. [Chargeback Code: 13]

1007     REQUEST FOR NEW ACCOUNT BY THE TELEPHONE IN CONJUNCTION WITH A PURCHASE

         Bank will consider a consumer's application for an Account made via the
         Internet or by telephone. For Internet applications, the Cardholder
         Agreement shall be transmitted to the consumer by Bank through the
         website. If approved, Accounts opened via the Internet application
         process are immediately available for Card Sales. For applications made
         in conjunction with the consumer's catalog order to Company, the
         Account will be immediately available for Card Sales only if the
         consumer received the full Cardholder Agreement in the catalog. If the
         consumer applies for an Account by telephone and did not receive a
         catalog containing the Cardholder Agreement, Company's employee or
         representative may not process the Card Sale on the Account opened via
         telephone until the consumer receives a written copy of the Cardholder
         Agreement by mail or express

                                       30
<PAGE>

         delivery. If Company delivers the Cardholder Agreement to the consumer
         by next-day delivery, the Card Sale for such purchase will be processed
         by Bank on the same day that the Cardholder Agreement is received by
         the Cardholder. If Company delivers the Cardholder Agreement to the
         consumer via standard U.S. Mail, Company shall submit the Card Sale to
         Bank for processing one (1) day after mailing the Cardholder Agreement,
         and Bank will post the Card Sale to the Cardholder's Account three (3)
         days later. For Card Sales made pursuant to this paragraph, Bank may
         issue a Chargeback for such Card Sale if: (i) the Cardholder challenges
         or disputes any portion of the Cardholder Agreement, (ii) or alleges
         non-receipt of the Cardholder Agreement and Bank is unable to enforce
         collection due to Company's employee's or representative's alleged
         failure to provide a copy of the Cardholder Agreement to the
         Cardholder. [Chargeback Code: 21]

1008     SPECIAL CREDIT PLANS

         Company must provide Cardholders who make a purchase under a Special
         Credit Plan with the point-of-sale disclosure that Bank provides to
         Company prior to the time Company's employee or representative
         completes the Card Sale. If Company's employee or representative fails
         to provide a Cardholder with the point-of-sale disclosure prior to the
         time the Card Sale is completed, Bank may issue a Chargeback if: (i)
         the Cardholder challenges or disputes the purchase made under the
         Special Credit Plan and alleges that he/she did not receive the
         point-of-sale disclosure, and (ii) Bank is unable to enforce collection
         because Company's employee or representative did not give the
         Cardholder the point-of-sale disclosure.
         [Chargeback Codes: 17 and 18]

1009     ADD-ON SALE AUTHORIZATION

         Company's employees or representatives must complete a Sales Slip and
         obtain an Authorization for every sale made on the Card prior to
         concluding the transaction. If Company's employees or representatives
         receive a "call center" message on the point-of-sale terminal, or a
         Company's employee or representative cannot obtain an electronic
         Authorization, Company's employees or representatives must obtain
         Authorization via the "800" Authorization system. If Company's
         employees or representatives fail to follow this procedure Bank may
         issue a Chargeback if : (i) the Cardholder challenges or disputes the
         purchase, and (ii) Bank is unable to collect the Card Sale because
         Company's employees or representatives did not provide the disclosure.
         [Chargeback Codes: 1 and 2]

1010     ADD-ON SALE WITHOUT A CARD

         1.     For purchases made at Company's retail locations:

         If a Cardholder wants to make a purchase at a retail location of
         Company and does not have his/her Card, Company's employee or
         representative must obtain two (2) pieces of acceptable identification
         (as set forth in paragraph 1006, above) from the Cardholder and verify
         the Cardholder's identity. Company's employee or representative must
         notate on

                                       31
<PAGE>

         the sales slip the two (2) types of identification (i.e., driver's
         license number and type of credit card) and that no card was present at
         the time of sale. Then, Company's employee or representative must call
         the Operations Center to obtain the Cardholder's Card number.

         2.     For catalog purchases and all other purchases made by phone or
                facsimile:

         Company's employees or representatives must obtain the following
         additional information from the Cardholder and reflect such information
         on the Sales Slip:

         (i)    The Cardholder's full address.
         (ii)   The Cardholder's telephone number.

         If Company's employees or representatives fail to follow these
         procedures, Bank may issue a Chargeback if the Cardholder disputes
         the transaction. [Chargeback Codes: 23 and 24]

1011     REQUEST FOR CANCELLATION OF AUTHORIZATION

         If a Company employee or representative, or a Cardholder cancels a Card
         Sale before Company's employee or representative completes the Card
         Sale and Company's employee or representative previously obtained an
         Authorization for the Card Sale, Company's employee or representative
         must call the Authorization Center and cancel the previous
         Authorization. Company can only cancel an Authorization on the same day
         it is made.

1012     "CODE 10" ALERT

         A Company employee or representative who is suspicious of the validity
         of a Card or Card Account number or the presenter of the Card or Card
         Account number for any reason should notify the Authorization Center
         via the "Code 10" Alert. The "Code 10" Alert should be used regardless
         of the dollar amount of the sale. The procedure is as follows:

         1.     Call the Authorization Center and ask for a "Code 10"
                Authorization.

         2.     The Authorization Center associate will request the Cardholder's
                Account number and Company's name and will immediately alert the
                Fraud Department.

         3.     The Fraud Department personnel will ask a brief series of Yes
                or No questions about the Card or the presenter, or may ask
                the Company employee to attempt to obtain a photo I.D. from
                the presenter.

         4.     If the Fraud Department is able to confirm the identity of the
                presenter as a valid Cardholder or authorized user of the Card,
                Bank will approve the Card Sale. The presenter should not be
                aware that anything unusual has transpired.

                                       32
<PAGE>

         5.     IF, ON THE OTHER HAND, COMPANY'S EMPLOYEE OR REPRESENTATIVE IS
                INSTRUCTED TO RETAIN THE CARD, OR NOT AUTHORIZE THE SALE, THE
                COMPANY'S EMPLOYEE OR REPRESENTATIVE SHOULD DO SO, BUT ONLY BY
                PEACEFUL AND REASONABLE MEANS.

                                       33
<PAGE>

1013     ARRESTS FOR FRAUDULENT CARD USAGE

         Each Operations Center through its Fraud Department may request
         Company's employee or representative to assist in the arrest of a Card
         presenter who is suspected of fraudulent use of a Card. Company
         employee or representative must use reasonable, lawful means when
         complying with this request.

         Anyone arrested for fraudulent use of a Card will be appropriately
         prosecuted. Except as provided below, each Operations Center shall bear
         all responsibility for the arrest of a person when such Operations
         Center has requested the Company employee or representative to cause
         such an arrest.

         BANK EXPECTS THAT A COMPANY EMPLOYEE OR REPRESENTATIVE WILL NOT
         INITIATE AN ARREST OF A CARD PRESENTER EXCEPT AT THE REQUEST OF BANK.
         IF A COMPANY EMPLOYEE OR REPRESENTATIVE CAUSES THE ARREST OR
         PROSECUTION OF ANY PERSON FOR THE USE OF A CARD WITHOUT THE BANK'S
         SPECIFIC REQUEST AND AUTHORIZATION OR FAILS TO USE REASONABLE, LAWFUL
         MEANS IN EFFECTING AN ARREST THAT BANK REQUESTED AND AUTHORIZED,
         COMPANY WILL BEAR ALL CLAIMS, LIABILITIES, COSTS, AND EXPENSES
         RESULTING FROM THE ARREST OR PROSECUTION.

1014     CREDIT ISSUED FOR RETURNED MERCHANDISE AND ADJUSTMENTS

         Bank will honor Company's return policy as long as the policy complies
         with all federal, state and local laws and Company clearly posts or
         otherwise notifies the Cardholder of the policy at the time of the Card
         Sale. Company must not give cash refunds to any Cardholder in
         connection with a Card Sale. If a Cardholder returns goods or services
         purchased with a Card at Company's retail establishments in accordance
         with Company's policy, Company's employees or representatives must give
         a Credit to the Cardholder's Account by completing a Credit Slip, as
         described in Section 1004. If a Cardholder receives merchandise or
         services that are defective or not as agreed upon at the time of the
         Card Sale and Cardholder requests a Credit, Company must give the
         Cardholder the Credit. Employees or representatives must send the Bank
         Sales Data for each Credit within 7 calendar days after Company's
         employees or representatives issue the Credit to the Cardholder.
         [Chargeback Codes: 5 and 8]

1015     PAYMENTS

         Company is not allowed to receive or process a Cardholder's payment to
         Bank unless the Merchant Services Agreement specifically authorizes
         Company to process Cardholder payments.

1016     TICKET RETRIEVALS

                                       34
<PAGE>

         Company has fifteen (15) Business Days to review and respond to any
         Cardholder billing dispute. Bank may issue a Chargeback if the inquiry
         or dispute is not resolved or if the Company fails to notify the Card
         Operations Center that it resolved the dispute by the end of the
         fifteenth (15th) Business Day.
         [Chargeback Code: 16]

1017     FORMS

         Company must use the Card forms provided by Bank as soon as Bank
         provides the forms to Company. Company must destroy all Card forms that
         Bank replaces. If Company fails, Bank may process a Chargeback for the
         amounts uncollectible by Bank because Company failed to use current
         Card forms. [Chargeback Code: 25]

1018     CHARGEBACKS

         Under certain circumstances Bank may return a Card Sale to Company
         unpaid, or Bank may return a previously paid Card Sale to Company for
         repayment to Bank. These returned charges are called "Chargebacks". If
         a billing error is asserted by a Cardholder with respect to a Card
         Sale, or if a Cardholder complains to Bank about the quality of goods
         or services obtained with the Card at Company's establishment, Company
         agrees to act in good faith to attempt to resolve the problem with the
         Cardholder. If the Cardholder refuses to pay Bank for goods or services
         due to a quality dispute, Bank will process a Chargeback for the charge
         or disputed portion of it. If Bank is involved in a lawsuit with a
         Cardholder relating to a Card Sale made at Company's establishment,
         Company agrees to cooperate with Bank and to provide any assistance to
         Bank. If Company does not follow all the terms of the Merchant Services
         Agreement and these Operating Regulations when making a transaction
         with a Card, or if a Card Sale which is the subject of a billing
         dispute or quality dispute is subject to Chargeback as specified in
         these Operating Regulations or the Merchant Services Agreement, Bank
         may refuse to pay Company for the Card Sale or the disputed portion of
         it. If Bank has already paid Company, Company must immediately pay the
         amount it owes Bank on demand, or Bank may deduct the amount in
         question from Company's Settlement Account or from future payments that
         they would otherwise owe Company. Bank will notify Company of Card
         Sales that are subject to Chargeback as they arise, but in some
         instances Bank may process Chargebacks prior to notification as
         specified in these Operating Regulations. If Company and a Cardholder
         resolve a billing inquiry or dispute on a Card Sale for which Bank
         issued a Chargeback, and Bank is permitted by law to rebill the
         Cardholder for all or a portion of the disputed amount, Bank will
         reimburse Company for the portion of the Chargeback which Bank can
         rebill to the Cardholder, provided Company requests the reimbursement
         within ninety (90) days from the date of Chargeback. If, due to federal
         or state laws, or both, Bank is not permitted to rebill a Cardholder
         for all or a portion of a disputed transaction, Bank will not be
         required to reimburse Company for the Chargeback, even if Company has
         complied with the terms of the Merchant Services Agreement and the
         procedures as outlined in the Operating Regulations. Attached as
         Exhibit A is a chart summarizing Chargeback Codes, Definitions,
         Explanations and Required Documentation to support or refute
         Chargebacks. For purposes of Exhibit A the phrase "promptly collected
         from the Cardholder" means that Bank has attempted to collect from the
         Cardholder for at least

                                       35
<PAGE>

         fifty-nine (59) consecutive days. Bank's failure to issue a Chargeback
         to Company immediately after the fifty-nine (59) consecutive days have
         passed does not mean that Bank has forfeited its right to charge back
         the transaction to Company.

1019     REVERSALS OF CHARGEBACKS

         If within ninety (90) days from the date of the Chargeback, Company has
         been unable to resolve the dispute with the Cardholder, Company may
         request a Chargeback reversal from Bank. Bank will review all relevant
         facts and circumstances pertaining to Company and the Cardholder and
         determine if Bank should reverse the Chargeback. If Bank determines
         that it should reverse the Chargeback, Bank will issue a separate
         credit to the Company and debit the Cardholder. Company must not submit
         a new Card Sale transaction in an identical amount in order to recover
         from a Cardholder for a transaction for which Bank has issued a
         Chargeback. Company may request a reversal of a Chargeback by
         submitting to Bank a copy of the original Sales Slip and documentation
         to support the request for reversal of the Chargeback as set forth in
         Exhibit A. Bank will advise Company where it should send Chargeback
         reversal requests. Bank, exercising its reasonable judgment, will
         decide whether it will reverse any Chargeback.

1020     TELEPHONE MONITORING

         Company must notify its associates and obtain each associate's written
         consent that, from time to time, Bank or its processor may monitor and
         tape record telephone calls between Company's associates and Bank's or
         its processor's associates for training purposes.

1021     COMPANY EMPLOYEE FRAUD

         Bank and Company will work together to minimize possible fraud by
         Company employees. Company employees must not issue or accept temporary
         credit cards. The store manager must either mail in or phone in to the
         Operations Center employee applications for a Card. If Company suspects
         that one of its employees is involved with or may be involved with
         fraud relating to the Card Plan, Company must notify Bank within
         forty-eight (48) hours of its discovery of the possible fraud and
         provide Bank with the employee's name and address, the reasons why
         Company suspects the employee and any documentation Company has
         relating to the possible fraud. [Chargeback Codes: 14 and 26]

1022     CLAIM BY CARDHOLDER OF NON-RECEIPT OF PURCHASE

         If a Cardholder advises Bank that he or she did not receive a purchase
         which was billed to his or her Account, Bank will make a reasonable
         investigation. If, after investigation, Bank cannot determine that the
         Cardholder actually received the purchase, Bank shall remove the amount
         of the purchase from the Cardholder's Account and charge that amount
         back to Company. [Chargeback Code 11] Capitalized terms used herein and
         not otherwise defined will have the meanings given to them in the
         Merchant Services Agreement. If there are any conflicts between the
         terms

                                       36
<PAGE>

         of the Merchant Services Agreement and these Operating Regulations, the
         former shall govern.

                                       37

<PAGE>

                                    EXHIBIT A

<TABLE>
<CAPTION>

CODE          DEFINITION                   EXPLANATION
----          ----------                   -----------
<S>     <C>                         <C>

01      Transaction without         A valid Authorization was not obtained. This
        Required Authorization      Chargeback will only be exercised when such
                                    transaction cannot be promptly collected from the
                                    Cardholder.

02      Declined Authorization      The transaction was completed after the
                                    Company received a decline. This Chargeback
                                    will be exercised only when such transaction
                                    cannot be promptly collected from the
                                    Cardholder.

03      Invalid Cardholder Account  The transaction was submitted using an
        Number                      Account number for which no valid Account
                                    exists or can be located.

04      Late Presentation of        The time from transaction date to date of
        Transaction                 processing exceeds the 60-day limit allowed
                                    by Bank, and the transaction cannot be
                                    promptly collected from the Cardholder. In
                                    the event the Company's employees or
                                    representatives accept payments at Company's
                                    retail locations and such payment is
                                    returned to Company for insufficient funds,
                                    Company must present Bank with the
                                    insufficient funds item within fourteen (14)
                                    days of Company's receipt of the item from
                                    its bank.

05      Cardholder Disputes         The Cardholder disputes the quality of
        Merchandise/Services        merchandise purchased or service rendered or
                                    any portion thereof, and Company has not
                                    responded to such dispute in accordance with
                                    Section 2.9 of the Merchant Services
                                    Agreement.

06      Alteration of Amount        The Cardholder claims that the purchase
                                    amount for which the Cardholder signed was
                                    altered after the Cardholder signed the
                                    Sales Slip and without the Cardholder's
                                    consent or direction. Only the difference
                                    will be charged back to the Company.

<CAPTION>

                                          DOCUMENTATION TO           DOCUMENTATION TO
CODE          DEFINITION                  SUPPORT CHARGEBACK         REVERSE CHARGEBACK
----          ----------                  ------------------         ------------------
<S>                                     <C>                          <C>

01      Transaction without             D02 Authorization Report     None
        Required Authorization          for Sales Data;
                                        Cardholder Statement.

02      Declined Authorization          D02 Authorization Report     Sales Ticket
                                        showing Decline;
                                        Cardholder Statement.

03      Invalid Cardholder Account      R15 Reject-Re-entry Report;  None
        Number                          Purged Account Report.

04      Late Presentation of            Sales Ticket; Cardholder     None
        Transaction                     Statement.

05      Cardholder Disputes             Written Cardholder Claim.    Resolution of dispute by Company within time
        Merchandise/Services                                         frame set forth in section 2.9 of the
                                                                     Merchant Services Agreement evidenced by a
                                                                     signed agreement. Partial/Full Credit posted
                                                                     to Account.

06      Alteration of Amount            Cardholder's Receipt does    POS Transaction Log proving Cardholder
                                        not match copy of Sales      altered the amount.
                                        Ticket received from
                                        Company or the  Bank's
                                        Transaction Report.
</TABLE>

                                       38

<PAGE>

<TABLE>
<CAPTION>

CODE          DEFINITION                   EXPLANATION
----          ----------                   -----------
<S>     <C>                         <C>

07      Duplicate Processing        Cardholder claims they have been charged
                                    twice for a transaction.

08      Non-Receipt of Credit       Cardholder claims that a Credit issued by
                                    the Company has never been posted to the
                                    Cardholder's Account or Cardholder received
                                    a cash refund in connection with a Card Sale
                                    and the Cardholder did not pay the Bank for
                                    such Card Sale. The Chargeback is limited to
                                    the amount of the Credit.

09      Unauthorized Purchase       The Cardholder, in writing, claims that
                                    neither the Cardholder nor any party
                                    authorized by the Cardholder participated in
                                    the transaction and that the Cardholder has
                                    no knowledge of the transaction.

10      Missing Signature           The Application or the Sales Slip is missing
                                    the Cardholder signature and the Cardholder
                                    does not recognize the Card Sale.

11      Non-Receipt of Goods or     Company submitted a Card Sale in which the
        Services                    goods or services were not yet shipped or
                                    otherwise provided to the Cardholder or the
                                    Cardholder claims they have not received the
                                    goods or services for which they have been
                                    charged.

12      Split Sale (where           A purchase for a single item cannot be split
        applicable)                 between the Card and another credit card or
                                    financing vehicle. However, the purchase can
                                    be split between the Card and cash or check
                                    or the Card and an unsecured general purpose
                                    bank card such as Visa, MasterCard or a
                                    NOVUS brand card.

13      No Card Application         Any transaction made by a Cardholder for
                                    whom a written Card application has not been
                                    submitted in accordance with Section 1006,
                                    paragraph 5, above, and the Cardholder
                                    claims they did not open an Account.

<CAPTION>

CODE          DEFINITION             DOCUMENTATION TO           DOCUMENTATION TO
----          ----------             SUPPORT CHARGEBACK         REVERSE CHARGEBACK
<S>     <C>                          ------------------         ------------------
                                     <C>                        <C>
07      Duplicate Processing         Cardholder statement(s).     Production of two Sales
                                                                  Slips with different
                                                                  authorization codes.
                                                                  POS Transaction Log

08      Non-Receipt of Credit        Cardholder's Credit Slip     None
                                     and Credit was not
                                     posted to Cardholder's
                                     Account.

09      Unauthorized Purchase        Written claim from           None
                                     Cardholder and copy of
                                     Sales Slip from Company.
                                     Bank compares signature
                                     on the Cardholder letter
                                     with signature on Sales
                                     Slip. Additional
                                     investigation may also be
                                      necessary.

10      Missing Signature            Unsigned Sales Slip/         None

11      Non-Receipt of Goods or      Written Cardholder           Shipping Invoice
        Services                     Complaint.                   Signed Delivery Ticket

12      Split Sale (where            Sales Slip; Written          None
        applicable)                  Cardholder Claim.

13      No Card Application          Written Cardholder Claim.    Copy of the Application

</TABLE>

                                       39

<PAGE>

<TABLE>
<CAPTION>

CODE          DEFINITION                   EXPLANATION
----          ----------                   -----------
<S>     <C>                         <C>

14      Sale made with a            Any transaction made with a temporary credit
        Temporary Credit Card       card.

15      Mismatched or Incomplete    One or more of the following items on the
        Application                 Application provided by the Company employee
                                    or representative at the point-of-sale for
                                    telephone approvals or REAP approvals does
                                    not match the written application
                                    information provided by the applicant.

                                    1.  Type of Residence
                                    2.  Length of time at Residence
                                    3.  Employment information
                                    4.  Banking relationship
                                    5.  Applicant's and Joint Applicant's identification
                                    6.  Absence of Primary and/or Joint Applicant's
                                        signature
                                    7.  Income

16      Non-Receipt of Requested    Sales Slip or Credit Slip has not been
        Document                    provided within 15 business days in response
                                    to ticket retrieval request or within any
                                    other date as otherwise specified in the
                                    Merchant Services Agreement.

17      Non-Receipt of Special      Cardholder claims they have not received a
        Credit Plan Disclosure      point-of-sale disclosure describing the
                                    terms of the Special Credit Plan. This
                                    Chargeback will be exercised only when such
                                    transaction cannot be promptly collected
                                    from the Cardholder.

18      Invalid Credit Plan         Company charged a sale to an invalid credit
                                    plan or misrepresented the type of the
                                    credit plan to the Cardholder and the
                                    Cardholder claims they were told the plan
                                    was either valid or for a longer period of
                                    time.

19      Altered or Counterfeit      Card Sale made with invalid Cards and/or
        Cards                       Card Account number. This Chargeback will
                                    only be exercised when such transaction
                                    cannot be promptly collected from the
                                    Cardholder.

20      Improper Card Use           Card use for purposes other than personal,
                                    family, household and charitable purposes.

<CAPTION>
                                       DOCUMENTATION TO           DOCUMENTATION TO
CODE          DEFINITION               SUPPORT CHARGEBACK         REVERSE CHARGEBACK
----          ----------               ------------------         ------------------
<S>     <C>                            <C>                        <C>
14      Sale made with a               Card type listed on Sales    Slip with
        Temporary Credit Card          Sales Slip.                  Card Swipe

15      Mismatched or Incomplete       Application copy; NAPS       None
        Application                    record.

16      Non-Receipt of Requested       Request made to              None
        Document                       Company and Sales Slip or
                                       Credit Slip is not received
                                       within specified  time.

17      Non-Receipt of Special         Written Cardholder Claim.    Set procedure in place and written
        Credit Plan Disclosure                                      documentation regarding point-of-sale
                                                                    disclosures.

18      Invalid Credit Plan            Monetary File/Authorization  None
                                       Report reveals an invalid
                                       credit plan number;
                                       Written Customer complaint.

19      Altered or Counterfeit         Invalid Card.                None
        Cards

20      Improper Card Use              Name on Application is       None
                                       a business name.

</TABLE>

                                       40
<PAGE>

<TABLE>
<CAPTION>

CODE          DEFINITION                   EXPLANATION
----          ----------                   -----------
<S>     <C>                         <C>

21      Failure to Give Cardholder  The Cardholder claims that they did not
        Agreement to Cardholder     receive the Cardholder Agreement at the
                                    point-of-sale for a new Account or that the
                                    Cardholder did not receive a catalog
                                    containing the Cardholder Agreement prior to
                                    opening an Account over the telephone in
                                    conjunction with a catalog order. This
                                    Chargeback will only be exercised when such
                                    transaction cannot be promptly collected
                                    from the Cardholder.

22      No Proper Identification    Company submitted an application that did
        For New Account             not contain evidence that Company's
        Application                 employees or representatives obtained and
                                    verified the appropriate identification for
                                    a New Account application. This Chargeback
                                    will only be exercised when such transaction
                                    cannot be promptly collected from the
                                    Cardholder.

23      No Proper Identification    Company's employee or representative failed
        For an Add-On-Sale          to note on the sales slip the two (2) types
        without a Card              of identification used and that no card was
                                    present at the time of the sale. This
                                    Chargeback will only be exercised when such
                                    transaction cannot be promptly collected
                                    from the Cardholder.

24      No Proper Identification    Company's employee or representative failed
        For Catalog, Phone or       to note on the sales slip the Cardholder's
        Fax Purchase                full address and telephone number for a
                                    catalog, phone or fax purchase. This
                                    Chargeback will only be exercised when such
                                    transaction cannot be promptly collected
                                    from the Cardholder.

25      Expired Cardholder Forms    Company's employees or representatives used
                                    Card forms that have expired or have been
                                    otherwise replaced by new forms by Bank.
                                    Only the portion of the transaction affected
                                    by the expired forms will be charged back to
                                    Company. This Chargeback will only be
                                    exercised when such transaction cannot be
                                    promptly collected from the Cardholder.

26      Employee Fraud              Company's employee or representative
                                    involved in fraud relating to the Card Plan.
<CAPTION>
                                     DOCUMENTATION TO           DOCUMENTATION TO
CODE          DEFINITION             SUPPORT CHARGEBACK         REVERSE CHARGEBACK
----          ----------             ------------------         ------------------
<S>     <C>                          <C>                        <C>
21      Failure to Give Cardholder   Written Cardholder Claim.    Well-documented  procedure
        Agreement to Cardholder                                   in place and training regarding
                                                                  handing out cardholder agreements
                                                                  and forms.

22      No Proper Identification     Application Copy;            None
        For New Account              NAPS record of
        Application                  verification of
                                     identification.

23      No Proper Identification     Sales Slip.                  Sales Slip with
        For an Add-On-Sale                                        identification notation.
        without a Card

24      No Proper Identification     Sales Slip.                  None
        For Catalog, Phone or
        Fax Purchase

25      Expired Cardholder Forms     Copy of Application-Form     None
                                     number indicates date on
                                     Form; Written Cardholder
                                     Claim.

26      Employee Fraud               Copy of Cardholder forms     None
                                     indicating Employee or
                                     Former-employee involvement.
</TABLE>

                                       41<PAGE>

                                  EXHIBIT 10.3

                           INDUSTRIAL LEASE AGREEMENT

                    BETWEEN THE COMPANY AND HAVEN GATEWAY LLC

                           DATED AS OF AUGUST 17, 2000

<PAGE>

                              HAVEN GATEWAY CENTRE
                                INDUSTRIAL LEASE

      THIS HAVEN GATEWAY CENTRE INDUSTRIAL LEASE (this "Lease") is made as of
August 17, 2000, by and between

"LANDLORD"  HAVEN GATEWAY LLC, a Delaware limited liability company

            and

"TENANT"    THE CHILDREN'S PLACE RETAIL STORES, INC., a Delaware corporation

                             SECTION 1: DEFINITIONS

1.1   DEFINITIONS: Each underlined term in this section shall have the meaning
      set forth next to that underlined term.
1.2   ACCESS LAWS: The Americans With Disabilities Act of 1990 (including the
      Americans with Disabilities Act Accessibility Guidelines for Building and
      Facilities) and all other Governmental Requirements relating to the
      foregoing.
1.3   ADDITIONAL RENT:  Defined in paragraph captioned "ADDITIONAL RENT".
1.4   BASE BUILDING.  Defined in the Work Letter Agreement attached hereto as
      EXHIBIT C.
1.5   BASE RENT:

      Monthly Base Rent:

<TABLE>
<CAPTION>

      LEASE MONTHS            MONTHLY BASE RENT

<S>                           <C>
      1-29                    $73,800.56

      30-59                   $79,422.04

      60-87                   $84,844.53

      Annual Base Rent:

      LEASE MONTHS            ANNUAL BASE RENT

      1-29                    $885,606.72

      30-59                   $953,064.48

      60-87                   $1,018,134.36
</TABLE>

                                       1
<PAGE>

1.6   BROKERS: Tenant was represented in this transaction by The Seeley Company,
      a licensed real estate broker.
      Landlord was represented in this transaction by Investment Development
      Services and Cushman and Wakefield, licensed real estate brokers.
1.7   BUILDING: A free-standing industrial building being constructed on the
      Land, which Building shall be commonly known as 3800 East Philadelphia
      Street, Ontario, California, which will contain approximately 248,738
      rentable square feet and be built substantially in accordance with the
      Shell Specifications.
1.8   BUSINESS DAY: Calendar days, except for Saturdays and Sundays and holidays
      when banks are closed in Los Angeles, California.
1.9   CLAIMS: An individual and collective reference to any and all claims,
      demands, damages, injuries, losses, liens, liabilities, penalties, fines,
      lawsuits, actions, other proceedings and expenses (including attorney's
      fees and expenses incurred in connection with the proceeding whether at
      trial or on appeal).
1.10  COMMENCEMENT DATE: The earlier to occur of: (a) the date on which Tenant
      first conducts business in any portion of the Premises, or (b) thirty (30)
      days after Substantial Completion. Except as set forth in this Lease,
      Tenant shall not be obligated to pay Base Rent or Additional Rent under
      this Lease until the Commencement Date occurs.
1.11  ESTIMATED OPERATING COSTS ALLOCABLE TO THE PREMISES: Defined in paragraph
      captioned "ADDITIONAL RENT".
1.12  EVENTS OF DEFAULT: One or more of those events or states of facts defined
      in the paragraph captioned "EVENTS OF DEFAULT".
1.13  EXCESS ALLOWANCE: Defined in the Work Letter Agreement attached hereto as
      EXHIBIT C.
1.14  GOVERNMENTAL AGENCY: The United States of America, the state in which the
      Land is located, any county, city, district, municipality or other
      governmental subdivision, court or agency or quasi-governmental agency
      having jurisdiction over the Land and any board, agency or authority
      associated with any such governmental entity, including the fire
      department having jurisdiction over the Land.
1.15  GOVERNMENTAL REQUIREMENTS: Any and all statutes, ordinances, codes, laws,
      rules, regulations, orders and directives of any Governmental Agency as
      now or later amended.
1.16  HAZARDOUS SUBSTANCE(S): Asbestos, PCBs, petroleum or petroleum-based
      chemicals or substances, urea formaldehyde or any chemical, material,
      element, compound, solution, mixture, sub-stance or other matter of any
      kind whatsoever which is now or later defined, classified, listed,
      designated or regulated as hazardous, toxic or radioactive by any
      Governmental Agency.
1.17  LAND: The land upon which the Building is located in County of San
      Bernardino, State of California, as legally described in EXHIBIT A
      attached to this Lease.
1.18  LANDLORD: The limited liability company named on the first page of this
      Lease, or its successors and assigns as provided in paragraph captioned
      "ASSIGNMENT BY LANDLORD".
1.19  LANDLORD'S AGENTS: Landlord's partners, officers, directors, agents,
      employees, trustees, members, investment advisors, consultants and
      contractors.
1.20  LEASE TERM: Commencing on the Commencement Date, and ending eighty seven
      (87) months later, subject to renewal or earlier termination in accordance
      with the terms of this Lease. If the Commencement Date is a date other
      than the first day of a calendar month, the Lease Term shall be extended
      by the number of days remaining in the month in which the Commencement
      Date occurs.

                                       2
<PAGE>

1.21  MANAGER: Investment Development Services, Inc., or its replacement, as
      specified by written notice from Landlord to Tenant.
1.22  MANAGER'S ADDRESS: 888 West Sixth Street, 9th Floor, Los Angeles,
      California 90017, which address may be changed by written notice from
      Landlord to Tenant.
1.23  OPERATING COSTS:  Defined in paragraph captioned "ADDITIONAL RENT".
1.24  OPERATING COSTS ALLOCABLE TO THE PREMISES:  Defined in paragraph captioned
      "ADDITIONAL RENT".
1.25  PARKING RIGHTS: As of the Commencement Date, Tenant shall be permitted to
      use two hundred (200) parking spaces on an exclusive basis in the
      Building's parking area (as reasonably designated by Landlord) for the
      following: 161 passenger cars (6 of which are for handicapped spaces), 2
      vans and 37 trailers. Tenant is aware and agrees that the final number of
      parking spaces may change if required by any Governmental Agency.
1.26  PERMITTED USE: Warehousing and Distribution of goods that are
      non-Hazardous Substances, and related office use incidental thereto, so
      long as such use is consistent with Governmental Requirements and with
      first-class industrial buildings of the same or similar use as the
      Building and located in the metropolitan area in which the Building is
      located.
1.27  INTENTIONALLY OMITTED
1.28  PREPAID RENT: $93,276.75, to be applied toward Base Rent and Additional
      Rent for the first full calendar month of the Lease Term or to the first
      calendar month in which full Base Rent and Additional Rent is due.
1.29  PREMISES: The entire Building, as depicted on the Plan attached hereto as
      EXHIBIT B. Landlord and Tenant hereby agree that the Premises consist of
      approximately 248,738 rentable square feet. Landlord and Tenant
      acknowledge and agree that the term "Premises" is used interchangeably
      with the term "Building" throughout this Lease. On or about the
      Commencement Date, Landlord shall provide to Tenant the certification of
      Landlord's architect or civil engineer as to the exact square footage of
      the Premises, and such certification shall be binding and conclusive on
      Landlord and Tenant for all purposes under this Lease. If the amount of
      the rentable square feet and/or the usable square feet of the Premises is
      adjusted as a result of such architect's certification, then Base Rent,
      Tenant's Pro Rata Share of the Project and the Tenant Improvement
      Allowance shall be equitably adjusted by Landlord accordingly.
1.30  PRIME RATE:  Defined in paragraph captioned "Default Rate".
1.31  PROJECT: The Haven Gateway Centre within which the Building and Land are
      located, which Project shall consist of approximately 73.64 acres and,
      when completed, estimated to be approximately 1,530,777 rentable square
      feet, as the same may be adjusted by Landlord from time to time. If the
      amount of rentable square feet of the Project is adjusted, then Tenant's
      Pro Rata Share shall be equitably adjusted by Landlord accordingly.
1.32  PROPERTY TAXES: (1) Any form of ad valorem real or personal property tax
      or assessment imposed by any Governmental Agency on the Land, Building,
      related improvements or any personal property owned by Landlord associated
      with the Building or Land; (2) any other form of tax or assessment,
      license fee, license tax, tax or excise on rent or any other levy, charge,
      expense or imposition made or required by any Governmental Agency on any
      interest of Landlord in the Building, Land, related improvements or
      personal property; (3) any fee for services charged by any Governmental
      Agency for any services such as fire protection, street, sidewalk and road

                                       3
<PAGE>

      maintenance, refuse collection, school systems or other services provided
      or formerly provided to property owners and residents within the general
      area of the Land; (4) any governmental impositions allocable to or
      measured by the area of any or all of the Building, Land, related
      improvements or personal property, or the amount of any base rent,
      additional rent or other sums payable under any lease for any or all of
      the Building, Land, related improvements or personal property, including
      any tax on gross receipts or any excise tax or other charges levied by any
      Governmental Agency with respect to the possession, leasing, operation,
      maintenance, alteration, repair, use or occupancy of any or all of the
      Land or Building, related improvements or personal property or the rent
      earned by any part of or interest in the Building or Land, related
      improvements or personal property; (5) any impositions by any Governmental
      Agency on any transaction evidenced by a lease of any or all of the
      Building or Land, related improvements or personal property or charge with
      respect to any document to which Landlord is a party creating or
      transferring an interest or an estate in any or all of the Building or
      Land, related improvements or personal property; and (6) any increase in
      any of the foregoing based upon construction of improvements or change of
      ownership of any or all of the Land, related improvements or personal
      property. Property Taxes shall not include taxes on Landlord's net income,
      any inheritance, estate or gift taxes, excess profits taxes, franchise
      taxes and capital stock taxes.
1.33  PUNCH LIST WORK: Minor items of repair, correction, adjustment or
      completion as such phrase is commonly understood in the construction
      industry in the metropolitan area in which the Land is located.
1.34  SECURITY DEPOSIT: Fifty Thousand Four Hundred Eighty Two and 00/100
      Dollars ($50,482.00).
1.35  SHELL SPECIFICATIONS: Defined in the Work Letter Agreement attached hereto
      as EXHIBIT C.
1.36  SHELL WORK: Defined in the Work Letter Agreement attached hereto as
      EXHIBIT C.
1.37  SUBSTANTIAL COMPLETION: The date that the Shell Work has been
      substantially completed substantially in accordance with the Shell
      Specifications, subject only to Punch List Work.
1.38  TENANT:  The person or entity(ies) named on the first page of this Lease.
1.39  TENANT ALTERATIONS:  Defined in paragraph captioned "TENANT ALTERATIONS".
1.40  TENANT IMPROVEMENT ALLOWANCE: The maximum amount to be expended by
      Landlord (subject to the Excess Allowance) for the cost of Tenant
      Improvements (including architectural, engineering, permitting and space
      planning fees), which maximum shall not exceed Four Hundred Thirty Five
      Thousand Two Hundred Ninety One and 50/100 Dollars ($435,291.50).
1.41  TENANT IMPROVEMENTS: Those alterations or improvements to be constructed
      in the Premises by Tenant in accordance with and subject to the terms and
      conditions of the Work Letter Agreement attached hereto as EXHIBIT C.
1.42  TENANT'S AGENTS: Any and all officers, partners, contractors,
      subcontractors, consultants, licensees, agents, concessionaires,
      subtenants, servants, employees, customers, guests, invitees or visitors
      of Tenant.
1.43  TENANT'S PRO RATA SHARE: One Hundred Percent (100%) of Operating Costs
      pertaining to the Building and/or the Land; Sixteen and 25/100 Percent
      (16.25%) of Operating Costs pertaining to the Project as a whole.
1.44  YEAR:  A calendar year commencing January 1 and ending December 31.

                                       4
<PAGE>

                          SECTION 2: PREMISES AND TERM

2.1   LEASE OF PREMISES. Landlord leases the Premises to Tenant, and Tenant
      leases the Premises from Landlord, upon the terms and conditions set forth
      in this Lease.
2.2   LEASE TERM. The Lease Term shall be for the period stated in the
      definition of that term, unless earlier terminated as provided in this
      Lease. The estimated date of Substantial Completion is currently October
      1, 2000, and the estimated Commencement Date is accordingly October 31,
      2000. Subject to Section 2.6 below, if Landlord is unable to deliver the
      Base Building to Landlord by the estimated date of Substantial Completion,
      this Lease shall not be void or voidable, and Landlord shall not be deemed
      to be in default hereunder, nor shall Landlord be liable for any loss or
      damage directly or indirectly arising out of or resulting from such delay.
      Tenant agrees to accept possession of the Base Building at such times as
      Landlord is able to tender the same.
2.3   EARLY ENTRY INTO PREMISES. Tenant may enter into the Premises prior to
      Substantial Completion, upon receipt of Landlord's prior written consent
      (which shall not be unreasonably withheld or delayed), solely for the
      purpose of installing furniture and trade fixtures, and installing and
      testing telephones, wiring, computers, photocopy equipment, and other
      business equipment. Such early entry will not advance the Commencement
      Date so long as Tenant does not commence business operations from any part
      of the Premises. All of the provisions of this Lease shall apply to Tenant
      during any early entry, including the insurance provisions of the Lease,
      but excluding the obligation to pay Base Rent unless and until Tenant has
      commenced business operations in the Premises, whereupon Base Rent shall
      commence. Landlord may revoke its permission for Tenant's early entry if
      Tenant's activities or workers interfere with the completion of the Tenant
      Improvements. If Tenant is granted early entry, Landlord shall not be
      responsible for any loss, including theft, damage or destruction to any
      work or material installed or stored by Tenant at the Premises or for any
      injury to Tenant or Tenant's Agents except that caused as a direct result
      of the gross negligence or willful misconduct of Landlord. Landlord shall
      have the right to post appropriate notices of non-responsibility and to
      require Tenant to provide Landlord with evidence that Tenant has fulfilled
      its obligation to provide insurance pursuant to the provisions of this
      Lease. During such early entry, Landlord shall have in place the insurance
      set forth in Section 4.14 below, and shall, after written request by
      Tenant, provide certificates of insurance, or their equivalents, to
      Tenant, evidencing the same.
2.4   TENANT IMPROVEMENTS. Tenant shall construct the Tenant Improvements
      pursuant to the Work Letter attached as EXHIBIT C.
2.5   SUBSTANTIAL COMPLETION. Landlord shall notify Tenant in writing at least
      five (5) Business Days in advance of the estimated date of Substantial
      Completion. If Tenant believes that Substantial Completion has not
      occurred, Tenant shall notify Landlord in writing of its objections within
      ten (10) Business Days after its receipt of the Landlord's notice
      described in the preceding sentence. Landlord shall have a reasonable time
      after its receipt of Tenant's notice in which to take such action as may
      be necessary to achieve Substantial Completion, and shall notify Tenant in
      writing when such has been completed. Taking of possession by Tenant shall
      establish the date of Substantial Completion as specified in the
      definition of that term and the establishment of such fact upon the taking
      of possession shall occur even if Tenant disputes whether Substantial
      Completion has occurred or attempts to condition or qualify the taking of
      possession. Such taking of possession shall further establish that the
      Base Building is in good and

                                       5
<PAGE>

      satisfactory condition when possession was so taken. Tenant acknowledges
      that no representations as to the condition of the Premises or Base
      Building have been made by Landlord, unless such are expressly set forth
      in this Lease. In the event of any dispute as to whether Substantial
      Completion has occurred, the certificate of Landlord's general contractor
      shall be conclusive, except that any delay in receipt of such certificate
      or in Substantial Completion which is caused by Tenant or Tenant's Agents
      shall be charged to Tenant in the amount of the daily Base Rent multiplied
      by the number of days of such delays. If on the date of Substantial
      Completion, Punch List Work remains to be completed, Landlord and Tenant
      shall agree on such Punch List Work and Landlord will diligently complete
      such Punch List Work. In no event shall Tenant's refusal or failure to
      agree on the nature and extent of Punch List Work or the existence of
      items of Punch List Work delay or postpone the occurrence of the date of
      Substantial Completion or the Commencement Date. If the estimated date of
      Substantial Completion changes at any time after Landlord has given notice
      pursuant to this Paragraph, then Landlord shall give at least five (5)
      Business Days advance notice of the new estimated date of Substantial
      Completion.
            If Substantial Completion has not occurred on or before October 1,
      2000 (the "First Deadline Date"), Tenant shall have the right, as its sole
      remedy, to one (1) day of Base Rent abatement, commencing upon the
      Commencement Date, for each day that the date of Substantial Completion
      extends beyond the First Deadline Date; provided however, that,
      notwithstanding anything to the contrary contained in this Lease, in no
      event shall Tenant receive more than sixty (60) days of Base Rent
      abatement pursuant to this Section 2.5, and the initial Lease Term shall
      be extended one (1) day for each day of Base Rent abatement that Tenant
      receives pursuant to this Section 2.5. Notwithstanding anything to the
      contrary contained in this Lease, the First Deadline Date shall be
      extended for any delays in Substantial Completion caused by any acts or
      omissions of Tenant or Tenant's Agents, force majeure event (as set forth
      in Section 6.8 below) or governmental delay.
            If Substantial Completion has not occurred on or before December 31,
      2000 (the "Second Deadline Date"), Tenant shall have the right, as its
      sole remedy, to terminate this Lease by notifying Landlord in writing of
      such election within five (5) Business Days after the Second Deadline
      Date, but prior to Substantial Completion. In the event of any such
      termination, neither Landlord nor Tenant shall have any rights,
      liabilities or obligations accruing under the Lease after the effective
      date of termination, except for such rights and liabilities which, by the
      terms of this Lease or at law, are obligations of the Tenant or Landlord
      which expressly survive the expiration of the Lease, and any prepaid
      amount that has not been properly applied by Landlord shall be promptly
      returned to Tenant. Notwithstanding anything to the contrary contained in
      this Lease, the Second Deadline Date shall be extended for any delays in
      Substantial Completion caused by any acts or omissions of Tenant or
      Tenant's Agents, force majeure event (as set forth in Section 6.8 below)
      or governmental delay; provided however, that the Second Deadline Date
      shall not be extended as a result of any failure to enter into the Edison
      Lease, as set forth in the immediately following paragraph.
            Landlord hereby represents and warrants to Tenant that the failure
      of Landlord to enter into either the Edison Lease or the side yard
      agreement to be executed in connection with the Edison Lease (the "Yard
      Agreement") shall not in and of itself preclude the issuance of the
      certificate of occupancy, or the equivalent sign-off by the appropriate
      building inspector, with respect to the Premises. In the event that after

                                       6
<PAGE>

      Substantial Completion, any failure to enter into either the Edison Lease
      or the Yard Agreement unconditionally in and of itself precludes the
      issuance of the certificate of occupancy, or the equivalent sign-off by
      the appropriate building inspector, with respect to the Premises (the
      "Edison Completion Failure"), then Tenant may terminate this Lease within
      ten (10) Business Days after either Landlord or Tenant notifies the other
      of the Edison Completion Failure.
2.6   TENANT'S CONTRIBUTION TO TENANT IMPROVEMENT COSTS. If the cost of the
      Tenant Improvements exceeds the Tenant Improvement Allowance and Excess
      Allowance, if any, Tenant shall pay to Landlord such excess in accordance
      with the terms of the Work Letter Agreement attached hereto as EXHIBIT C.
      All Tenant Improvements, regardless of which party constructed them, shall
      become the property of Landlord and shall remain upon and be surrendered
      with the Premises upon the expiration or earlier termination of this
      Lease; PROVIDED THAT, at Landlord's election and upon notice to Tenant,
      Tenant shall be required to remove all or any portion of the Tenant
      Improvements upon the expiration or earlier termination of this Lease.
2.7   CONDITION OF PREMISES "AS-IS". Subject to the performance by Landlord of
      its obligations to perform (or cause to be performed) the Shell Work in
      accordance with the Work Letter Agreement, Tenant hereby agrees that the
      Premises shall be taken "as is", "with all faults", without any
      representations or warranties, and Tenant hereby agrees and warrants that
      it has investigated and inspected the condition of the Premises and the
      suitability of same for Tenant's purposes, and Tenant does hereby waive
      and disclaim any objection to, cause of action based upon, or claim that
      its obligations hereunder should be reduced or limited because of the
      condition of the Premises or the Base Building or the suitability of same
      for Tenant's purposes. Tenant acknowledges that neither Landlord nor any
      agent nor any employee of Landlord has made any representations or
      warranty with respect to the Premises or the Base Building or with respect
      to the suitability of either for the conduct of Tenant's business, and
      Tenant expressly warrants and represents that Tenant has relied solely on
      its own investigation and inspection of the Premises and the Base Building
      in its decision to enter into this Lease and let the Premises in an "as
      is" condition. The taking of possession of the Premises by Tenant shall
      conclusively establish that the Premises and the Base Building were at
      such time in satisfactory condition.
2.8   MEMORANDUM OF COMMENCEMENT DATE. At Landlord's election and request,
      Tenant shall execute a Memorandum of Commencement Date in the form
      attached as EXHIBIT D. In no event shall Tenant record this Lease or the
      Memorandum of Commencement Date; provided however, that Tenant may record,
      at its sole cost and expense, a short form Memorandum of this Lease,
      provided that Tenant shall simultaneously deliver to Landlord a
      termination of such Memorandum, in recordable form, executed by Tenant, in
      form and content satisfactory to Landlord, which termination shall be held
      in trust by Landlord and may be recorded by Landlord, at Tenant's expense,
      on or after the expiration or earlier termination of the Lease.
2.9   USE AND CONDUCT OF BUSINESS. The Premises are to be used only for the
      Permitted Uses, and for no other business or purpose without the prior
      consent of Landlord. Landlord makes no representation or warranty as to
      the suitability of the Premises for Tenant's intended use. Tenant shall,
      at its own cost and expense, obtain and maintain any and all licenses,
      permits, and approvals necessary or appropriate for its use, occupation
      and operation of the Premises. Tenant's inability to obtain or maintain
      any such license, permit or approval necessary or appropriate for its use,
      occupation or

                                       7
<PAGE>

      operation of the Premises shall not relieve it of its obligations under
      this Lease, including the obligation to pay Base Rent and Additional Rent.
      No act shall be done in or about the Premises or Project that is unlawful
      or that will increase the existing rate of insurance on any or all of the
      Land or Building or Project. Tenant shall not commit or allow to be
      committed or exist: (a) any waste upon the Premises, (b) any public or
      private nuisance, or (c) any act or condition which may disturb the quiet
      enjoyment of any other tenant in the Building, or in any other building
      located within the Project, violate any of Landlord's contracts affecting
      any or all of the Land or Building or Project (provided that such
      contracts do not materially and unreasonably interfere with Tenant's
      Permitted Use), create or contribute to any work stoppage, strike,
      picketing, labor disruption or dispute, interfere in any way with the
      business of Landlord or any other tenant in the Project or with the rights
      or privileges of any contractors, subcontractors, licensees, agents,
      concessionaires, subtenants, servants, employees, customers, guests,
      invitees or visitors or any other persons lawfully in and upon the Land or
      Building or Project, or causes any impairment or reduction of the good
      will or reputation of the Land or Building or Project. Tenant shall not,
      without the prior consent of Landlord, use any apparatus, machinery,
      device or equipment in or about the Premises which will cause any
      substantial noise or vibration or any increase in the normal consumption
      level of electric power. If any of Tenant's apparatus, machinery,
      equipment or devices should disturb the quiet enjoyment of any other
      tenant in the Building or Project, then Tenant shall provide, at its sole
      cost and expense, adequate insulation or take other such reasonable
      action, including removing such apparatus, machinery, equipment or
      devices, as may be necessary to eliminate the disturbance.
2.10  COMPLIANCE WITH GOVERNMENTAL REQUIREMENTS AND RULES AND REGULATIONS.
      Tenant shall comply with all Governmental Requirements relating to the
      Premises (including, without limitation, Tenant's use, occupancy and
      operation thereof) and all other covenants, conditions and restrictions
      and other matters of record, and Tenant shall observe such reasonable
      rules and regulations as may be adopted and delivered to Tenant by
      Landlord from time to time for the safety, care and cleanliness of the
      Building or Project, and for the preservation of good order in the
      Building and Project, including the Rules and Regulations attached to this
      Lease as EXHIBIT E.
2.11  OPTION TO RENEW.
      2.11.1 RENEWAL OPTIONS. Provided Tenant is not in material default under
      this Lease beyond applicable notice and cure periods, and subject to the
      terms and conditions of this section 2.11, Tenant shall have (a) one (1)
      option to renew (the "FIRST OPTION TO RENEW") the term of the Lease with
      respect to the entire Premises for a period of thirty-three (33) months
      (the "FIRST OPTION TERM"), and (b) one (1) option to renew (the "SECOND
      OPTION TO RENEW") the term of the Lease with respect to the entire
      Premises for an additional period of sixty (60) months (the "SECOND OPTION
      TERM"). If Tenant does not timely and properly exercise the First Option
      to Renew, then the Second Option to Renew shall immediately become null
      and void with no further force and effect. Except as set forth in this
      section 2.11, all terms and conditions shall remain the same during the
      Option Term. Monthly Base Rent during the First Option Term shall be as
      follows:

<TABLE>
<CAPTION>

      First Option Term Months   Monthly Base Rent
      ------------------------   -----------------

<S>                              <C>
      1-29                       $89,645.18
</TABLE>

                                        8
<PAGE>

<TABLE>
<S>                              <C>
      30-33                      $90,316.77
</TABLE>

      Monthly Base Rent during the Second Option Term, if any, shall be the
      greater of (i) the then Fair Market Rental Rate, and (ii) the Monthly Base
      Rent for the last month of the immediately preceding First Option Term.
      The Annual Base Rent for each Option Term shall be equal to twelve (12)
      times the adjusted Monthly Base Rent. "Fair Market Rental Rate" shall mean
      the net effective market rental then being offered and accepted for
      comparable space and location in the city of Ontario, California, in first
      class industrial buildings comparable in location and condition to the
      Building, all as reasonably determined by Landlord, computed as described
      in the remainder of this paragraph. The net effective market rental shall
      equal the arithmetic average of the rental rate over the term of such
      comparable lease less any customary concessions (including tenant
      improvement allowances), provided that the value of the then existing
      Tenant Improvements shall be taken into account.
      2.11.2 NOTICE OF EXERCISE. Tenant shall give Landlord written notice of
      its unconditional exercise an Option to Renew at least two hundred seventy
      (270) days but not more than three hundred sixty (360) days prior to the
      expiration of the immediately preceding term of the Lease. If Tenant fails
      to notify Landlord in writing of its unconditional exercise its Option to
      Renew as set forth in the preceding paragraph, the Option to Renew shall
      terminate, and Landlord shall be free to enter into a lease with a third
      party. Within twenty (20) days after Landlord receives the notice
      described in the previous sentence with respect to the Second Option Term,
      Landlord will provide Tenant with Landlord's determination of the Fair
      Market Rental Rate for the Second Option Term. If such determination is
      based upon the Fair Market Rental Rate, Tenant shall have thirty (30) days
      from Landlord's notification of the proposed Base Rent to accept
      Landlord's determination of Base Rent for the Second Option Term or
      provide its own determination of Fair Market Rental Rate for Landlord's
      consideration accompanied by market information on which Tenant based its
      determination.
      2.11.3 DISPUTE REGARDING FAIR MARKET RENTAL RATE. If Landlord and Tenant
      are unable to agree on the Fair Market Rental Rate for the Second Option
      Term using their best good faith efforts within thirty (30) days from
      Landlord's notification of the proposed Base Rent, Landlord shall, no more
      than ten (10) days thereafter, select an independent M.A.I. (certified in
      the State of California) real estate appraiser, or real estate broker with
      at least seven (7) years experience in the metropolitan area of the
      Ontario, California industrial real estate market, who shall prepare a
      written appraisal or market report of the Fair Market Rental Rate using
      the assumptions described in paragraph 2.11.1. The report shall be
      completed and delivered to Tenant and Landlord within thirty (30) days
      from the date Landlord selects the appraiser or real estate broker. Such
      appraiser's/broker's determination of Fair Market Rental Rate for the
      Second Option Term shall be determinative unless Tenant disputes it as
      provided in the next sentence. If Tenant disputes such report Tenant shall
      within five (5) days following delivery of the report, deliver to Landlord
      notice (a) that Tenant disputes such report, and (b) of the identity of
      another appraiser or real estate broker selected by Tenant meeting the
      qualifications set forth in this paragraph. The appraiser/broker selected
      by Tenant shall submit his report of the Fair Market Rental Rate for the
      Second Option Term using the assumptions described in paragraph 2.11.1
      within twenty (20) days following the delivery of Tenant's notice to
      Landlord disputing the initial report. If the two reports are within two

                                       9
<PAGE>

      and one-half percent (2.5%) of each other, the Fair Market Rental Rate for
      the Second Option Term shall be that set forth in the report of Landlord's
      appraiser/broker. If not, then within five (5) days after the delivery of
      the second report, the two appraisers/brokers shall appoint a third
      appraiser/broker meeting the qualifications set forth in this paragraph,
      and the third appraiser/broker shall deliver his decision within ten (10)
      days following his selection and acceptance of the appraisal assignment.
      The third appraiser/broker shall be limited in authority to selecting, in
      his opinion, which of the two earlier reports determinations best reflects
      the Fair Market Rental Rate under the assumptions set forth in this
      paragraph. The third appraiser/broker must choose one of the two earlier
      reports, and, upon doing so, the third appraiser's/broker's determination
      shall be the controlling determination of the Fair Market Rental Rate for
      the Second Option Term. Each party shall pay the costs and fees of the
      appraiser/broker it selected; if a third appraiser/broker is selected, the
      party whose report is not selected to be the Fair Market Rental Rate by
      said third appraiser/broker shall pay all of said third
      appraiser's/broker's costs and fees.
      2.11.4 CONDITIONS. The rights contained in this section may be exercised
      only if the originally named Tenant (and not any assignee, sublessee, or
      other transferee of Tenant's interest in this Lease) occupies more than
      fifty percent (50%) of the Premises throughout the Lease, and more than
      sixty percent (60%) of the Premises as of the date it exercises the Option
      to Renew in accordance with the terms of this section.

SECTION 3: BASE RENT, ADDITIONAL RENT AND OTHER SUMS PAYABLE UNDER LEASE

3.1   PAYMENT OF RENTAL. Tenant agrees to pay Base Rent, Additional Rent and any
      other sum due under this Lease to Landlord without demand, deduction,
      credit, adjustment or offset of any kind or nature, in lawful money of the
      United States when due under this Lease, at the offices of Manager at
      Manager's Address, or to such other party or at such other place as
      Landlord may from time to time designate in writing.
3.2   BASE RENT. (a) On execution of this Lease, Tenant shall pay to Landlord
      the amount specified in the definition of Prepaid Rent for the month
      specified in the definition of that term. Tenant agrees to pay Base Rent
      to Landlord without demand, in advance on or before the first day of each
      calendar month of the Lease Term. Base Rent for any partial month at the
      beginning or end of the Lease Term shall be prorated. Base Rent for any
      partial month at the beginning of the Lease Term shall be paid by Tenant
      on the Commencement Date.
      (b) Provided Tenant is not in default under any of the terms, covenants
      and conditions of the Lease, Tenant shall be credited with the payment of
      Monthly Base Rent with respect to the Premises for the second (2nd), third
      (3rd) and fourth (4th) months of the Lease Term. No such Base Rent credit
      shall reduce the amount of Additional Rent and other charges which is
      otherwise payable by Tenant under this Lease. Tenant understands and
      agrees that the foregoing rental credit is conditioned upon Tenant's not
      having wrongfully terminated this Lease or Landlord not having terminated
      this Lease by reason of Tenant's default under this Lease (each such
      termination, a "Trigger Event"). Accordingly, (i) upon the occurrence of
      any Trigger Event during any portion of the rental credit period, the
      foregoing rental credit shall be null and void, and all of the Base Rent
      which, in the absence of such rental credit, would have been payable
      during such period up to the date of the Trigger Event shall become
      immediately due and payable by Tenant

                                       10
<PAGE>

      and Tenant shall pay Base Rent during the remainder of such rental credit
      period as such Base Rent would have become due and payable in the absence
      of such rental credit provision, and (ii) upon the occurrence of any
      Trigger Event after the rental credit period, all Base Rent which would
      have been payable during such rental credit period in the absence of such
      rental credit shall become immediately due and payable by Tenant.
3.3   SECURITY DEPOSIT. On execution of this Lease, Tenant shall pay to Landlord
      the sum specified in the definition of the term Security Deposit, as
      security for the full and faithful payment of all sums due under this
      Lease and the full and faithful performance of every covenant and
      condition of this Lease to be performed by Tenant. If Tenant shall breach
      or default with respect to any payment obligation or other covenant or
      condition of this Lease, Landlord may apply all or any part of the
      Security Deposit to the payment of any sum in default or any damage
      suffered by Landlord as a result of such breach or default, and in such
      event, Tenant shall, upon demand by Landlord, deposit with Landlord the
      amount so applied so that Landlord shall have the full Security Deposit on
      hand at all times during the Lease Term. In the event Tenant defaults,
      beyond applicable notice and cure periods, on its obligations to pay Base
      Rent, Additional Rent or any other sum under this Lease on more than two
      occasions during any twelve (12) month period, Landlord may, at any time
      thereafter require an increase in the Security Deposit by an amount equal
      to one hundred percent (100%) of the amount specified in the definition of
      the term Security Deposit and Tenant shall immediately deposit such
      additional amount with Landlord upon Landlord's demand. Following such
      increase, the definition of the term Security Deposit shall refer to the
      amount of the Security Deposit prior to the increase plus the increased
      amount. The remedy of increasing the Security Deposits for Tenant's
      multiple defaults shall be in addition to and not a substitute for any of
      Landlord's other rights and remedies under this Lease or applicable Law.
      Additionally, Landlord's use or application of all or any portion of the
      Security Deposit shall not impair any other rights or remedies provided
      under this Lease or under applicable law and shall not be construed as a
      payment of liquidated damages. If Tenant shall have fully complied with
      all of the covenants and conditions of this Lease, the remaining Security
      Deposit shall be repaid to Tenant, without interest, within thirty (30)
      Business Days after the expiration of this Lease. Tenant may not mortgage,
      assign, transfer or encumber the Security Deposit and any such act on the
      part of Tenant shall be without force or effect. In the event any
      bankruptcy, insolvency, reorganization or other creditor-debtor
      proceedings shall be instituted by or against Tenant, the Security Deposit
      shall be deemed to be applied first to the payment of Base Rent,
      Additional Rent and all other sums payable under this Lease to Landlord
      for all periods prior to the institution of such proceedings and the
      balance, if any, may be retained by Landlord and applied against
      Landlord's damages. In the event of a sale or transfer of Landlord's
      estate or interest in the Land and Building, Landlord shall have the right
      to transfer the Security Deposit to the vendee or the transferee, and
      Landlord shall be considered released by Tenant from all liability for the
      return of the Security Deposit. Tenant shall look solely to the transferee
      for the return of the Security Deposit, and it is agreed that all of the
      foregoing shall apply to every transfer or assignment made of the Security
      Deposit to a new transferee. No mortgagee or purchaser of any or all of
      the Building at any foreclosure proceeding brought under the provisions of
      any mortgage shall (regardless of whether the Lease is at the time in
      question subordinated to the lien of any mortgage) be liable to Tenant or
      any other person for any or all of such sum (or any other or additional
      security deposit or other payment made by Tenant under the provisions of
      this Lease), unless Landlord has

                                       11
<PAGE>

      actually delivered it in cash to such mortgagee or purchaser, as the case
      may be. In the event of any rightful and permitted assignment of Tenant's
      interest in this Lease, the Security Deposit shall be deemed to be held by
      Landlord as a deposit made by the assignee, and Landlord shall have no
      further liability to the assignor with respect to the return or the
      Security Deposit.
            No right or remedy available to Landlord in this Lease shall
      preclude or extinguish any other right to which Landlord may be entitled.
      It is understood that if Tenant fails to perform its obligations and to
      take possession of the Premises as provided in this Lease, the Prepaid
      Rent and the Security Deposit shall not be deemed liquidated damages.
      Landlord may apply such sums to reduce Landlord's damages and such
      application of funds shall not preclude Landlord from recovering from
      Tenant all additional damages incurred by Landlord.
3.4   ADDITIONAL RENT. Definitions of certain terms used in this paragraph are
      set forth in subparagraph 3.4.5. Tenant agrees to pay to Landlord, as
      additional rent as computed in this paragraph (individually and
      collectively the "Additional Rent"), all Operating Costs Allocable to the
      Premises. Tenant acknowledges that this is intended to be a triple net
      lease.
      3.4.1   RENTAL ADJUSTMENT FOR ESTIMATED OPERATING COSTS. Landlord shall
              furnish Tenant a written statement of Estimated Operating Costs
              Allocable to the Premises for each Year and the amount payable
              monthly by Tenant for such costs shall be computed as follows:
              one-twelfth (1/12) of the amount of Estimated Operating Costs
              Allocable to the Premises shall be Additional Rent and shall be
              paid monthly by Tenant for each month during such Year after the
              Commencement Date. If such written statement is furnished after
              the commencement of the Year (or as to the first Year during the
              Lease Term, after the Commencement Date), Tenant shall also make a
              retroactive lump-sum payment to Landlord equal to the monthly
              payment amount multiplied by the number of months during the Year
              (or as to the first Year during the Lease Term, after the
              Commencement Date) for which no payment was paid. Notwithstanding
              the foregoing, Landlord reserves the right, from time to time
              during each Year, to revise the Estimated Operating Costs
              Allocable to the Premises and upon advance written notice to
              Tenant of such revision, Tenant shall adjust its payment to
              Landlord under this subparagraph 3.4.1 accordingly.
      3.4.2   ACTUAL COSTS. After the close of each Year, Landlord shall deliver
              to Tenant a written statement setting forth the Operating Costs
              Allocable to the Premises during the preceding Year. If such
              Operating Costs Allocable to the Premises for any Year exceed the
              Estimated Operating Costs Allocable to the Premises paid by Tenant
              to Landlord pursuant to subparagraph 3.4.1 for such Year, Tenant
              shall pay the amount of such excess to Landlord within twenty (20)
              Business Days after receipt of such statement by Tenant. If such
              statement shows the Operating Costs Allocable to the Premises to
              be less than the Estimated Operating Costs Allocable to the
              Premises paid by Tenant to Landlord pursuant to subparagraph
              3.4.1, then the amount of such overpayment shall be paid by
              Landlord to Tenant within twenty (20) Business Days following the
              date of such statement or, at Landlord's option, shall be credited
              towards the installment(s) of Additional Rent next coming due from
              Tenant.

                                       12
<PAGE>

      3.4.3   DETERMINATION OF OPERATING COSTS. The determination of Operating
              Costs Allocable to the Premises shall be reasonably made by
              Landlord.
      3.4.4   END OF TERM. If this Lease shall terminate on a day other than the
              last day of a Year, (a) Landlord shall estimate the Operating
              Costs Allocable to the Premises for such Year predicated on the
              most recent reliable information available to Landlord; (b) the
              amount determined under clause (a) of this sentence shall be
              prorated by multiplying such amount by a fraction, the numerator
              of which is the number of days within the Lease Term in such Year
              and the denominator of which is 360; (c) if the clause (b) amount
              exceeds the Estimated Operating Costs Allocable to the Premises
              paid by Tenant for the last Year in the Lease Term, then Tenant
              shall pay the excess to Landlord within ten (10) Business Days
              after Landlord's delivery to Tenant of a statement for such
              excess; and (d) if the Estimated Operating Costs Allocable to the
              Premises paid by Tenant for the last Year in the Lease Term
              exceeds the clause (b) amount, then Landlord shall refund to
              Tenant the excess within the ten (10) Business Day period
              described in clause (c) if Tenant is not then in default of any of
              its obligations under this Lease. Landlord's and Tenant's
              obligations under this paragraph shall survive the expiration or
              other termination of this Lease.
      3.4.5   DEFINITIONS. Each underlined term in this subparagraph shall have
              the meaning set forth next to that underlined term:
              (a) ESTIMATED OPERATING COSTS ALLOCABLE TO THE PREMISES.
              Landlord's estimate of Operating Costs Allocable to the Premises
              for a Year to be given by Landlord to Tenant pursuant to
              subparagraph 3.4.1.
              (b) OPERATING COSTS. All commercially reasonable expenses paid or
              incurred by Landlord in connection with the ownership, operation,
              maintenance and/or repair of: (i) the Building; (ii) the Project,
              provided that for purposes of this Lease, such expenses shall be
              limited to that amount of operating costs for the entire Project
              which is fairly and equitably allocated by Landlord, in its
              absolute discretion, to the Building; and (iii) the personal
              property used in conjunction with such maintenance, operation,
              ownership and repair, including, without limitation, all expenses
              paid or incurred by Landlord for: (a) utilities, including
              electricity, water, gas, sewers, fire sprinkler charges, refuse
              collection, telephone charges, cable television or other
              electronic or microwave signal reception, steam, heat, cooling or
              any other service which is now or in the future considered a
              utility and which are not payable directly by tenants in the
              Building; (b) supplies; (c) cleaning and janitorial services
              (including window washing) landscaping and landscaping maintenance
              (including irrigating, trimming, mowing, fertilizing, seeding and
              replacing plants), snow removal and other services; (d) security
              services, if any; (e) insurance; (f) management fees; (g) Property
              Taxes, tax consultant fees and expenses, and costs of appeals of
              any Property Taxes; (h) services of independent contractors; (i)
              compensation (including employment taxes and fringe benefits) of
              all persons who perform duties in connection with any service,
              repair, maintenance, replacement or improvement or other work
              included in this subparagraph; (j) license, permit and inspection
              fees; (k) assessments and special assessments due to deed
              restrictions, declarations or owners associations or other means
              of allocating costs of a larger tract of which the Land is a part;
              (l) rental of any machinery or equipment; (m) audit fees and
              accounting services related to the Building, and

                                       13
<PAGE>

              charges for the computation of the rents and charges payable by
              tenants in the Building (but only to the extent the cost of such
              fees and services are in addition to the cost of the management
              fee); (n) the cost of improvements, repairs or replacements; (o)
              maintenance and service contracts; (p) legal fees and other
              expenses of legal or other dispute resolution proceedings; (q)
              maintenance and repair of the roof and roof membranes, (r) costs
              incurred by Landlord for compliance with Access Laws, as set forth
              in the paragraph entitled "Access Laws"; (s) elevator service and
              repair, if any; (t) business taxes and license fees; (u)
              maintenance and repair of the HVAC system in the Building and
              Project; (v) ground rent payable to Edison (defined below) or its
              successors pursuant to the Edison Lease (defined below); and (w)
              any other expense or charge which in accordance with generally
              accepted accounting and management principles would be considered
              an expense of maintaining, operating, owning or repairing the
              Building and the Project. Without limiting the foregoing,
              Operating Costs shall include replacement of roofs and roof
              membranes; exterior painting; parking area resurfacing, resealing
              and restriping parking areas and driveways; upgrading of the HVAC
              systems in the Building, and other capital improvements to the
              Building or to the Project if such costs set forth earlier in this
              sentence are to be equitably allocated as provided above in this
              subparagraph; PROVIDED THAT, such capital improvements, whether
              installed before or after the Commencement Date, shall be
              amortized with market interest over their estimated useful lives
              as determined by Landlord and only the amortization installments
              and interest attributable to the Lease Term shall be an Operating
              Cost under this Lease.
                  Operating Costs shall not include any of the following:
              interest and amortization of funds borrowed by Landlord for items
              other than capital improvements; leasing commissions and
              advertising, promotional and space planning expenses incurred in
              procuring tenants; salaries, wages, or other compensation paid to
              officers or executives of Landlord in their capacities as officers
              and executives; any cost or expense related to the testing for,
              removal, transportation, or storage of Hazardous Substances from
              the Building, except to the extent caused by or required as a
              result of the acts or omissions of Tenant or Tenant's Agents;
              alterations, additions or improvements made to comply with any
              Governmental Requirements in effect as of the date of this Lease,
              other than those required as a result of the acts or omissions of
              Tenant or Tenant's Agents or triggered by the Tenant Improvements
              or Tenant's particular use of the Premises; any and all costs of
              any kind or character for any injuries, damage and repairs
              necessitated by the negligence or willful misconduct of Landlord
              or Landlord's employees, contractors or agents; depreciation of
              the Building and other improvements located on the Project; and
              interest, penalties or other costs arising out of Landlord's
              failure to make timely payment of its obligations.
              (c) OPERATING COSTS ALLOCABLE TO THE PREMISES. The product of
              Tenant's Pro Rata Share times Operating Costs.
      3.4.6   JANITORIAL SERVICES. Notwithstanding anything to the contrary
              contained in this Lease, Tenant shall contract directly with a
              janitorial service and shall pay for all janitorial services used
              on or for the Premises.

                                       14
<PAGE>

      3.4.7   ADDITIONAL RENT. Any sums payable under this Lease pursuant to
              this paragraph or otherwise shall be Additional Rent and, in the
              event of nonpayment of such sums, Landlord shall have the same
              rights and remedies with respect to such nonpayment as it has with
              respect to nonpayment of the Base Rent due under this Lease.
      3.4.8   OPERATING COST AUDIT. Landlord shall maintain records concerning
              estimated and actual Operating Costs Allocable to the Premises for
              no less than twelve (12) months following the period covered by
              the statement or statements furnished Tenant, after which time
              Landlord may dispose of such records. Provided that Tenant is not
              then in default of its obligation to pay Base Rent, Additional
              Rent or other payments required to be made by it under this Lease
              and provided that Tenant is not otherwise in default under this
              Lease, Tenant may, at Tenant's sole cost and expense, cause a
              Qualified Person (as defined below) to inspect Landlord's records.
              Such inspection, if any, shall be conducted no more than once each
              Year, during Landlord's normal business hours within sixty (60)
              Business Days after receipt of Landlord's written statement of
              Operating Costs Allocable to the Premises for the previous year,
              and upon Tenant first furnishing Landlord written notice of the
              inspection, if any, at least fifteen (15) Business Days in advance
              of such inspection. Any errors disclosed by the review shall be
              promptly corrected by Landlord; provided, however, that if
              Landlord disagrees with any such claimed errors, Landlord shall
              have the right to cause another review to be made by an auditor of
              Landlord's choice. In the event the results of the review of
              records (taking into account, if applicable, the results of any
              additional review caused by Landlord) reveal that Tenant has
              overpaid obligations for a preceding period, the amount of such
              overpayment shall be credited against Tenant's subsequent
              installment of Base Rent, Additional Rent or other payments due to
              Landlord under the Lease. In the event that such results show that
              Tenant has underpaid its obligations for a preceding period, the
              amount of such underpayment shall be paid by Tenant to Landlord
              with the next succeeding installment obligation of estimated
              Operating Costs Allocable to the Premises. If the actual Operating
              Costs Allocable to the Premises for any given Year were improperly
              computed and if the actual Operating Costs Allocable to the
              Premises are overstated by more than 5%, Landlord shall reimburse
              Tenant for the cost of its audit. A "QUALIFIED PERSON" means an
              internal auditor of Tenant or an accountant or other person
              experienced in accounting for income and expenses of industrial
              projects.
3.5   UTILITIES. Landlord shall have the right from time to time to select the
      company or companies providing electricity, gas, fuel, local telephone,
      telecommunication and any other utility services to the Building. Tenant
      shall contract directly and pay for all water, gas, heat, light, power,
      telephone, telecommunications, sewer, fire sprinkler charges and other
      utilities used on or from the Premises together with any taxes, penalties,
      surcharges or similar charges relating to such utilities. If any such
      service is not separately metered to the Premises, the cost therefor shall
      be an Operating Cost under this Lease. If Tenant desires to use the
      services of a provider of local telephone or telecommunication services
      whose equipment is not then servicing the Building, no such provider shall
      be permitted to install its lines or other equipment within the Building
      without the prior written consent of Landlord.

                                       15
<PAGE>

3.6   HOLDOVER. If Landlord agrees in writing that Tenant may hold over after
      the expiration or earlier termination of this Lease, unless the parties
      hereto otherwise agree in writing as to the terms of such holding over,
      the holdover tenancy shall be subject to termination by Landlord or Tenant
      at any time upon not less than thirty (30) days' prior written notice. If
      Tenant holds over without the consent of Landlord, the same shall be a
      tenancy at will terminable at any time, and Tenant shall be liable to
      Landlord for, and Tenant shall indemnify, protect, defend and hold
      Landlord harmless from and against, any damages, liabilities, losses,
      costs, expenses or claims suffered or caused by such holdover, including
      damages and costs related to any successor tenant of the Premises to whom
      Landlord could not deliver possession of the Premises when promised.
      During the first two (2) months of any holdover tenancy, whether with or
      without consent, Tenant shall pay to Landlord from time to time upon
      demand, an amount equal to one hundred twenty five percent (125%) of the
      then applicable Base Rent, plus all Additional Rent and other sums payable
      under this Lease, and be bound by all the terms, covenants and conditions
      specified in this Lease, as so far applicable. During all subsequent
      months of any holdover tenancy, whether with or without consent, Tenant
      shall pay to Landlord from time to time upon demand, an amount equal to
      one hundred fifty percent (150%) of the then applicable Base Rent, plus
      all Additional Rent and other sums payable under this Lease, and be bound
      by all the terms, covenants and conditions specified in this Lease, as so
      far applicable. No holding over by Tenant, whether with or without consent
      of Landlord, shall operate to extend this Lease. The preceding provisions
      of this Paragraph 3.6 shall not be construed as Landlord's consent to any
      holding over by Tenant.
3.7   LATE CHARGE. If Tenant fails to make any payment of Base Rent, Additional
      Rent or other amount within five (5) days from when due under this Lease,
      a late charge is immediately due and payable by Tenant equal to five
      percent (5%) of the amount of any such payment. Landlord and Tenant agree
      that this charge compensates Landlord for the administrative costs caused
      by the delinquency. The parties agree that Landlord's damage would be
      difficult to compute and the amount stated in this paragraph represents a
      reasonable estimate of such damage. Assessment or payment of the late
      charge contemplated in this paragraph shall not excuse or cure any Event
      of Default or breach by Tenant under this Lease or impair any other right
      or remedy provided under this Lease or under law.
3.8   DEFAULT RATE. Any Base Rent, Additional Rent or other sum payable under
      this Lease which is not paid when due shall bear interest at a rate equal
      to the lesser of: (a) the published prime rate of Riggs Bank N.A., or such
      other national banking institution designated by Landlord if such bank
      ceases to publish a prime rate (the "PRIME RATE"), then in effect, plus
      two (2) percentage points, or (b) the maximum rate of interest per annum
      permitted by applicable law (the "DEFAULT RATE"), but the payment of such
      interest shall not excuse or cure any Event of Default or breach by Tenant
      under this Lease or impair any other right or remedy provided under this
      Lease or under law.

                          SECTION 4: GENERAL PROVISIONS

4.1   MAINTENANCE AND REPAIR BY LANDLORD. Subject to the paragraphs captioned
      "DAMAGE OR DESTRUCTION" and "CONDEMNATION", Landlord shall maintain the
      public and common areas of the Project in reasonably good order and
      condition, except ordinary wear and tear, and except for damage occasioned
      by the act or omission of Tenant or Tenant's

                                       16
<PAGE>

      Agents which shall be paid for entirely by Tenant upon written demand by
      Landlord. In the event any or all of the Project becomes in need of
      maintenance or repair which Landlord is required to make under this Lease,
      and Landlord does not otherwise have notice of same, then Tenant shall
      immediately give written notice to Landlord, and Landlord shall commence
      such maintenance or repairs within a commercially reasonable time after
      Landlord's receipt of such notice. Tenant hereby waives the benefit of
      Sections 1941 and 1942 of the California Civil Code and any other statute
      providing a right to make repairs and deduct the cost thereof from the
      Rent. Tenant waives any right to terminate this Lease or offset or abate
      Rent by reason of any failure of Landlord to make repairs to the Premises.
4.2   MAINTENANCE AND REPAIR BY TENANT. Except as is expressly set forth as
      Landlord's responsibility pursuant to the paragraph captioned "MAINTENANCE
      AND REPAIR BY LANDLORD," Tenant shall at Tenant's sole cost and expense
      keep and maintain all portions of the Premises in good condition and
      repair, including, without limitation, the structure of the Premises,
      painting, cleaning of all exterior glass, plumbing and utility fixtures
      and installations, carpets and floor coverings, all wall surfaces and
      coverings including tile and paneling, replacement of all broken windows
      (including without limitation any exterior windows), exterior and interior
      doors, roof penetrations and membranes in connection with any Tenant
      installations on the roof in accordance with Section 4.4 below, including
      satellite dishes, light bulb replacement and interior preventative
      maintenance. If Tenant fails to maintain or repair the Premises in
      accordance with this paragraph, and there is an imminent threat of damage
      to person or property (as reasonably determined by Landlord), then
      Landlord may, but shall not be required to, enter the Premises to perform
      such maintenance or repair at Tenant's sole cost and expense. Tenant shall
      pay to Landlord the cost of such maintenance or repair plus a ten percent
      (10%) administration fee, within twenty (20) Business Days of written
      demand from Landlord. Tenant shall, at its own cost and expense, enter
      into a regularly scheduled preventive maintenance/service contract with a
      maintenance contractor for servicing all hot water, heating and air
      conditioning systems and equipment located within or dedicated solely to
      the Premises. The maintenance contractor and the contract must be
      reasonably approved in advance by Landlord. The service contracts shall
      include all services recommended by the equipment manufacturer within the
      operation/maintenance manual and shall become effective (and a copy
      thereof delivered to Landlord) within forty-five (45) days following the
      date Tenant takes possession of the Premises.
4.3   COMMON AREAS/SECURITY. The common areas of the Project shall be subject to
      Landlord's sole management and control. Without limiting the generality of
      the immediately preceding sentence, Landlord reserves the exclusive right
      as it deems necessary or desirable to install, construct, remove, maintain
      and operate lighting systems, facilities, improvements, equipment and
      signs on, in or to all parts of the common areas; change the number, size,
      height, layout, or locations of walks, driveways and truckways or parking
      areas now or later forming a part of the Land or Project; make alterations
      or additions to the Building or Project or common area; close temporarily
      all or any portion of the common areas to make repairs, changes or to
      avoid public dedication; grant easements to which the Land will be
      subject, replat, subdivide, or make other changes to the Land; place,
      relocate and operate utility lines through, over or under the Land and
      Building and Project; and use or permit the use of all or any portion of
      the roofs of the Building; provided, however, that access to the Premises
      and Tenant's ability to use the Premises for its normal business purposes
      shall not be materially and adversely

                                       17
<PAGE>

      affected thereby. Landlord has no duty or obligation to provide any
      security services in, on or around the Premises, Land or Project, and
      under no circumstances shall Landlord be responsible for, and Tenant
      waives any rights with respect to, Landlord providing security or other
      protection for Tenant or Tenant's Agents or property in, on or about the
      Premises, Land or Project. Subject to Section 4.4 below, Tenant may, at
      its sole cost and expense, install, establish and maintain security
      services within the Premises; PROVIDED THAT such security services,
      including, without limitation, any apparatus, facilities, equipment or
      people utilized in connection with the provision of such security
      services, comply with the Governmental Requirements and shall not cause
      the Building or the Project to be out of compliance with the Governmental
      Requirements. Notwithstanding the foregoing, any such security services
      installed, established or maintained by Tenant must not affect or impact
      any portion of the Building, Land or the Project other than the Premises
      and shall not in any way limit or interfere with Landlord's ability to
      exercise its rights as provided in the paragraph captioned "ACCESS".
      Tenant's rights under this subparagraph are subject to all the
      obligations, limitations and requirements as set forth in the paragraphs
      captioned "TENANT ALTERATIONS" and "TENANT'S WORK PERFORMANCE". Landlord
      reserves the right to relocate parking areas and driveways and to build
      additional improvements in the common areas so long as Tenant's Parking
      Rights are maintained, and Tenant's access to the Building are not
      materially and adversely affected thereby.
4.4   TENANT ALTERATIONS. Tenant shall not make any alterations, additions or
      improvements in or to the Premises, or make changes to locks on doors, or
      add, disturb or in any way change any floor covering, wall covering,
      fixtures, plumbing or wiring (individually and collectively "TENANT
      ALTERATIONS"), without first obtaining the consent of Landlord which may
      not be unreasonably withheld or delayed, except that Landlord may withhold
      its approval in its sole and absolute discretion if the Tenant Alterations
      will affect, as determined by Landlord, the structure or exterior of the
      Building, or the Building systems. Tenant shall deliver to Landlord full
      and complete plans and specifications for any proposed Tenant Alterations
      and, if consent by Landlord is given, all such work shall be performed at
      Tenant's expense by Tenant. Tenant shall pay to Landlord all costs
      incurred by Landlord for any architectural, engineering, supervisory
      and/or legal services in connection with any Tenant Alterations including,
      without limitation, Landlord's review of the plans and specifications for
      any Tenant Alterations. Without limiting the generality of the foregoing,
      Landlord may require Tenant, at Tenant's sole cost and expense, to obtain
      and provide Landlord with proof of insurance coverage and a payment and
      performance bond, in forms, amounts and by companies acceptable to
      Landlord. Should Tenant make any Tenant Alterations without Landlord's
      prior written consent, or without satisfaction of any conditions
      established by Landlord, Landlord shall have the right, in addition to and
      without limitation of any right or remedy Landlord may have under this
      Lease, at law or in equity, to require Tenant to remove some or all of the
      Tenant Alterations at Tenant's sole cost and expense and restore the
      Premises to the same condition existing prior to undertaking the Tenant
      Alterations. All Tenant Alterations to the Premises, other than trade
      fixtures (such as computer systems, telephone and communication systems,
      storage systems, specialized HVAC equipment installed by Tenant at its
      sole expense and servicing only its computer room, cubicles and those
      trade fixtures set forth on Exhibit "F" attached hereto), shall become the
      property of Landlord and shall remain upon and be surrendered with the
      Premises upon the expiration or earlier termination of this Lease;
      provided, however, at Landlord's sole

                                       18
<PAGE>

      election, Tenant shall be obligated, at its sole cost and expense, to
      remove all (or such portion as Landlord shall designate) of the Tenant
      Alterations and repair any damage resulting from such removal and return
      the Premises to the same condition existing prior to the undertaking upon
      the expiration or earlier termination of this Lease. Tenant shall have the
      right, at the time it requests Landlord's consent and delivers all plans
      and specifications to any Tenant Alteration (other than with respect to
      trade fixtures, such as computer systems, telephone and communication
      systems, storage systems, specialized HVAC equipment installed by Tenant
      at its sole expense and servicing only its computer room, and cubicles,
      which Landlord acknowledges remain Tenant's property to be removed upon
      the expiration or earlier termination of the Lease) to make a written
      request that Landlord notify Tenant whether Tenant shall be obligated to
      remove the applicable Tenant Alteration at the end of the Lease Term, in
      which event Tenant shall only be obligated to remove (i) those Tenant
      Alterations that Landlord notified Tenant it must remove at the end of the
      Lease Term at the same time of and in connection with Tenant's requested
      approval of the Tenant Alterations, and (ii) those Tenant Alterations that
      Tenant did not seek or did not obtain Landlord's written consent to leave
      in place at the end of the Lease Term, and that Landlord requires Tenant
      to remove. If Tenant fails to remove any such Tenant Alterations as
      required by Landlord's consent, Landlord may do so and Tenant shall pay
      the entire cost thereof to Landlord within ten (10) Business Days after
      Tenant's receipt of Landlord's written demand therefor. Tenant shall
      reimburse Landlord, upon receipt of demand therefor, for all out of pocket
      costs and expenses incurred by Landlord during its review of Tenant's
      plans and specifications (regardless of whether Landlord approves Tenant's
      request) and Tenant's construction. Nothing contained in this paragraph or
      the paragraph captioned "TENANT'S WORK PERFORMANCE" shall be deemed a
      waiver of the provisions of the paragraph captioned "MECHANIC'S LIENS."
4.5   TENANT'S WORK PERFORMANCE. Any Tenant Alterations, and the Tenant
      Improvements, to be performed by Tenant under this Lease shall be
      performed by contractors employed by Tenant under one or more construction
      contracts, in form and content approved in advance in writing by Landlord
      (which approval shall be subject to Landlord's discretion and may include
      a requirement by Landlord that the prime contractor and the respective
      subcontractors of any tier: (a) be parties to, and bound by, a collective
      bargaining agreement with a labor organization affiliated with the
      Building and Construction Trades Council of the AFL CIO and (b) employ
      only members of such labor organizations to perform work within their
      respective jurisdictions). Tenant's contractors, workers and suppliers
      shall work in harmony with and not interfere with workers or contractors
      of Landlord or other tenants of Landlord. If Tenant's contractors, workers
      or suppliers do, in the opinion of Landlord, cause such disharmony or
      interference, Landlord's consent to the continuation of such work may be
      withdrawn upon written notice to Tenant. All Tenant Alterations shall be
      (1) completed in accordance with the plans and specifications approved by
      Landlord; (2) completed in accordance with all Governmental Requirements;
      (3) carried out promptly in a good and workmanlike manner; (4) of all new
      materials; and (5) free of defect in materials and workmanship. Tenant
      shall pay for all damage to the Premises, Building Land and Project caused
      by Tenant or Tenant's Agents. Tenant shall indemnify, defend and hold
      harmless Landlord and Landlord's Agents from any Claims arising as a
      result of the Tenant Alterations or any defect in design, material or
      workmanship of any Tenant Alterations.

                                       19
<PAGE>

4.6   SURRENDER OF POSSESSION. Tenant shall, at the expiration or earlier
      termination of this Lease, surrender and deliver the Premises to Landlord
      in as good condition as when received by Tenant from Landlord or as later
      improved, reasonable use and wear excepted, and free from all tenancies or
      occupancies by any person.
4.7   REMOVAL OF PROPERTY. Upon expiration or earlier termination of this Lease,
      Tenant may remove its personal property, office supplies and office
      furniture and equipment if (a) such items are readily moveable and are not
      attached to the Premises; (b) such removal is completed prior to the
      expiration or earlier termination of this Lease; (c) Tenant is not in
      material default of any covenant or condition of this Lease at the time of
      such removal; and (d) Tenant immediately repairs all damage caused by or
      resulting from such removal. All other property in the Premises and any
      Tenant Alterations (including, wall-to-wall carpeting, paneling, wall
      covering or lighting fixtures and apparatus) or any other article affixed
      to the floor, walls, ceiling or any other part of the Premises, shall
      become the property of Landlord and shall remain upon and be surrendered
      with the Premises; provided, however, at Landlord's sole election, Tenant
      shall be obligated, at its sole cost and expense, to remove all (or such
      portion as Landlord shall designate) of the Tenant Alterations and all (or
      such portion as Landlord shall designate) of the Tenant Improvements
      constructed in the Premises, and repair any damage resulting from such
      removal. Except as Landlord and Tenant may otherwise expressly agree,
      Tenant waives all rights to any payment or compensation for such Tenant
      Alterations. If Tenant shall fail to remove any of its property of any
      nature from the Premises or Land at the expiration or earlier termination
      of this Lease or when Landlord has the right of re-entry, Landlord may, at
      its option, remove and store such property without liability for loss of
      or damage to such property, such storage to be for the account and at the
      expense of Tenant. If Tenant fails to pay the cost of storing any such
      property, Landlord may, at its option, after it has been stored for a
      period of twenty (20) Business Days or more, sell or permit to be sold,
      any or all such property at public or private sale (and Landlord may
      become a purchaser at such sale), in such manner and at such times and
      places as Landlord in its sole discretion may deem proper, without notice
      to Tenant, and Landlord shall apply the proceeds of such sale: FIRST, to
      the cost and expense of such sale, including reasonable attorney's fees
      actually incurred; SECOND, to the payment of the costs or charges for
      storing any such property; THIRD, to the payment of any other sums of
      money which may then be or later become due Landlord from Tenant under
      this Lease; and, FOURTH, the balance, if any, to Tenant.
4.8   ACCESS. Tenant shall permit Landlord and Landlord's Agents to enter into
      the Premises at any time on at least one (1) Business Day's notice (except
      in case of emergency, in which case no notice shall be required), for the
      purpose of inspecting the same or for the purpose of repairing, altering
      or improving the Premises or the Project. Nothing contained in this
      paragraph shall be deemed to impose any obligation upon Landlord not
      expressly stated elsewhere in this Lease. When reasonably necessary,
      Landlord may temporarily close Building or Land entrances (but not all
      entrances, unless required by Governmental Requirements, or in the event
      of emergency), Building doors or other facilities, without liability to
      Tenant by reason of such closure and without such action by Landlord being
      construed as an eviction of Tenant or as relieving Tenant from the duty of
      observing or performing any of the provisions of this Lease; provided
      however, that if any such closure by Landlord unreasonably prevents Tenant
      from using or gaining access to the

                                       20
<PAGE>

      Premises, then Base Rent and Additional Rent due under this Lease during
      the period that Tenant is unreasonably prevented from using or gaining
      access to the Premises shall be abated (to the extent of Landlord's rental
      loss insurance proceeds) in proportion to the portion of the Premises for
      which Tenant is unreasonably denied use or access, unless such closure
      arises out of the acts or omissions of Tenant or Tenant's Agents, in which
      event there shall be no such abatement. During the last six (6) months of
      the Lease Term, Landlord shall have the right to enter the Premises at any
      time during the Lease Term for the purpose of showing the Premises to
      prospective tenants and to erect near (but not on) the Premises a suitable
      sign indicating the Premises are available. Tenant shall give written
      notice to Landlord at least twenty (20) Business Days prior to vacating
      the Premises and shall arrange to meet with Landlord for a joint
      inspection of the Premises prior to vacating. In the event of Tenant's
      failure to give such notice or arrange such joint inspection, Landlord's
      inspection at or after Tenant's vacating the Premises shall be deemed
      correct, unless better evidence exists, for purposes of determining
      Tenant's responsibility for repairs and restoration. Except for Landlord's
      gross negligence or willful misconduct, Landlord shall not be liable for
      the consequences of admitting by passkey, or refusing to admit to the
      Premises, Tenant or any of Tenant's Agents, or other persons claiming the
      right of admittance.
4.9   DAMAGE OR DESTRUCTION.
      4.9.1   RESTORATION OF PREMISES. If the Premises are damaged by fire,
              earthquake or other casualty, Tenant shall give immediate written
              notice thereof to Landlord. If Landlord estimates that the damage
              can be repaired in accordance with the then established
              Governmental Requirements within two hundred seventy (270) days
              after Landlord is notified by Tenant of such damage (which
              estimate shall be delivered to Tenant by Landlord within
              forty-five (45) days after Landlord has knowledge of the damage)
              and if there are sufficient insurance proceeds available to repair
              such damage, then Landlord shall proceed with reasonable diligence
              to restore the Building to substantially the condition which
              existed prior to the damage and this Lease shall not terminate.
              If, in Landlord's estimation, the damage cannot be repaired within
              such 270 day period or if there are insufficient insurance
              proceeds available to repair such damage, Landlord may elect in
              its absolute discretion to either: (a) terminate this Lease or (b)
              restore the Building to substantially the condition which existed
              prior to the damage and this Lease will continue. If Landlord
              restores the Building under this paragraph, then (1) the Lease
              Term shall be extended for the time required to complete such
              restoration, (2) Tenant shall pay to Landlord, upon demand,
              Tenant's Pro Rata Share of any applicable deductible amount
              specified under Landlord's insurance and (3) Landlord shall not be
              required to repair or restore Tenant Improvements, Tenant
              Alterations, or any or all furniture, fixtures, equipment,
              inventory, improvements or other property which was in or about
              the Premises at the time of the damage and was not owned by
              Landlord. Base Rent, Additional Rent and any other sum due under
              this Lease during any reconstruction period shall be abated in
              proportion to the portion of the Premises rendered untenantable by
              the damage.
      4.9.2   DAMAGE IN EXCESS OF FIFTY PERCENT. If the Project is damaged by
              fire, earthquake or other casualty and more than fifty percent
              (50%) of the Project is rendered untenantable, Landlord may, in
              its absolute discretion and without limiting any other options
              available to Landlord under this Lease or otherwise, elect to
              terminate this Lease by notice in writing to Tenant within thirty
              (30) Business Days after Landlord has knowledge of such damage.
              Such notice

                                       21
<PAGE>

              shall be effective twenty (20) Business Days after receipt by
              Tenant, unless a later date is set forth in Landlord's notice.
      4.9.3   TERMINATION OF LEASE BY MORTGAGE HOLDER'S ELECTION.
              Notwithstanding anything contained in this Lease to the contrary,
              if there is damage to the Premises, or Building and the holder of
              any indebtedness secured by a mortgage or deed of trust covering
              any such property requires that the insurance proceeds be applied
              to such indebtedness or the insurance proceeds are otherwise
              inadequate to complete the repair of the damages to the Premises,
              the Building or both, then Landlord shall have the right to
              terminate this Lease by delivering written notice of termination
              to Tenant within fifteen (15) Business Days after such requirement
              is made by such holder.
      4.9.4   DESTRUCTION NEAR END OF TERM. Notwithstanding the foregoing, if
              the Premises or the Project are wholly or partially damaged or
              destroyed within the final twelve (12) months of the Lease Term,
              Landlord and Tenant may each, at its option, elect to terminate
              this Lease upon written notice given to the other within thirty
              (30) days following such damage or destruction.
      4.9.5   WAIVER. Tenant waives the provisions of any statutes presently
              existing or hereafter enacted (including, without limitation,
              California Civil Code sections 1932 and 1933) which relate to
              termination of leases when the thing leased is destroyed and
              agrees that such event will be governed by the terms of this
              Lease.
      4.9.6.  TERMINATION BY TENANT. Notwithstanding anything to the contrary
              set forth in this Section 4.9 above, within forty-five (45) days
              after the date of any such damage or destruction, Landlord shall
              notify Tenant of the estimated time to complete the repairs and
              restoration of the Premises and Project, as estimated by an
              independent contractor approved by Landlord (the "Landlord
              Response Notice"). Notwithstanding anything to the contrary set
              forth in the proceeding paragraph, if Landlord notifies Tenant
              that the estimated time to complete the repairs or restoration
              will exceed two hundred ten (210) days from the date of such
              damage or destruction, Tenant may terminate this Lease effective
              as of the date of such damage or destruction by delivering written
              notice thereof to Landlord within thirty (30) days after receipt
              of Landlord's Response Notice. If the Lease is not terminated as
              provided above, and the repairs and restoration are not completed
              within two hundred ten (210) days after the damage or destruction,
              Tenant may deliver written notice to Landlord stating that if the
              repairs and restoration are not completed within forty-five (45)
              days thereafter, Tenant will terminate the Lease. If the repairs
              and restoration are not completed within forty-five (45) days
              after Tenant delivers such notice to Landlord, Tenant may
              terminate the Lease effective as of the date of such damage or
              destruction by delivering written notice thereof to Landlord.
4.10  CONDEMNATION. If all of the Premises, or such portions of the Building as
      may be required for the Tenant's Permitted Use, are taken by eminent
      domain or by conveyance in lieu thereof, this Lease shall automatically
      terminate as of the date the physical taking occurs, and all Base Rent,
      Additional Rent and other sums payable under this Lease shall be paid to
      that date. In case of taking of a part of the Premises or a portion of the
      Building not required for the Tenant's Permitted Use, then this Lease
      shall continue in full force and effect and the Base Rent shall be
      equitably reduced based on the proportion by which the floor area of the
      Premises is reduced, such reduction in Base Rent to be

                                       22
<PAGE>

      effective as of the date the physical taking occurs. Additional Rent and
      all other sums payable under this Lease shall not be abated but Tenant's
      Pro Rata Share shall be reduced as equitable under the circumstances.
      Landlord reserves all rights to damages or awards for any taking by
      eminent domain relating to the Premises, Building, Land and the unexpired
      term of this Lease. Tenant assigns to Landlord any right Tenant may have
      to such damages or award and Tenant shall make no claim against Landlord
      for damages for termination of its leasehold interest or interference with
      Tenant's business. Tenant shall have the right, however, to claim and
      recover from the condemning authority compensation for any loss to which
      Tenant may be entitled for Tenant's moving expenses or other relocation
      costs; PROVIDED THAT, such expenses or costs may be claimed only if they
      are awarded separately in the eminent domain proceedings and not as a part
      of the damages recoverable by Landlord. Tenant waives all rights it may
      have under California Code of Civil Procedure section 1265.130, or
      otherwise, to terminate this Lease based on a partial condemnation.
      Landlord acknowledges that nothing contained herein shall prevent Tenant
      from recovering damages from a Governmental Authority in connection with
      an inverse condemnation claim, or similar claim, instituted by Tenant as a
      result of any failure to enter into the Edison Lease.
4.11  PARKING. Tenant shall have the nonexclusive privilege to use parking
      spaces within the Project in common with other tenants of Landlord, but
      only in areas reasonably designated by Landlord. Tenant's parking
      privileges shall be subject to the rules and regulations relating to
      parking adopted by Landlord from time to time. In no event shall the
      number of parking stalls used by Tenant and Tenant's Agents exceed the
      number of stalls allocated to Tenant in the definition of the Parking
      Rights. Landlord shall have no obligation whatsoever to monitor, secure or
      police the use of the parking or other common areas. Tenant shall pay,
      upon fifteen (15) days notice from Landlord, Landlord's then standard
      charge for the parking spaces.
4.12  INDEMNIFICATION. Tenant shall indemnify and defend (except for Claims
      arising solely as a direct result of the negligence or willful misconduct
      of Landlord or its authorized agents, contractors, employees, members,
      trustees, officers or partners) and hold harmless (except for Claims
      arising solely as a direct result of the gross negligence or willful
      misconduct of Landlord or its authorized agents, contractors, employees,
      members, trustees, officers or partners) Landlord and Landlord's Agents
      from and against any and all Claims, arising in whole or in part out of
      (a) the possession, use or occupancy of the Premises or the business
      conducted in the Premises, (b) any act, omission or negligence of Tenant
      or Tenant's Agents, or (c) any breach or default under this Lease by
      Tenant. Neither Landlord nor Landlord's Agents shall, to the extent
      permitted by law, have any liability to Tenant, or to Tenant's Agents, for
      any Claims arising out of any cause whatsoever, including repair to any
      portion of the Premises; interruption in the use of the Premises or any
      equipment therein; any accident or damage resulting from any use or
      operation by Landlord, Tenant or any person or entity of heating, cooling,
      electrical, sewerage or plumbing equipment or apparatus; termination of
      this Lease by reason of damage to the Premises or Project; fire, robbery,
      theft, vandalism, mysterious disappearance or any other casualty; actions
      of any other tenant of the Project or of any other person or entity;
      inability to furnish any service required of Landlord as specified in this
      Lease; or leakage in any part of the Premises or the Project from rain,
      ice or snow, or from drains, pipes or plumbing fixtures in the Premises or
      the Project; except for Claims to the extent arising as a direct result of
      the gross negligence or willful misconduct of Landlord or its authorized
      agents, contractors, employees, members,

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<PAGE>

      trustees, officers or partners; Landlord shall indemnify, protect, defend
      and hold Tenant harmless from and against all Claims directly arising
      solely out of the gross negligence or willful misconduct of Landlord or
      its authorized agents, contractors, employees, members, trustees, officers
      and partners; PROVIDED THAT, in no event shall Landlord be responsible for
      any interruption to Tenant's business or for any indirect or consequential
      losses suffered by Tenant or Tenant's Agents. The obligations of this
      paragraph shall be subject to the paragraph entitled "WAIVER OF
      SUBROGATION".
4.13  TENANT INSURANCE.
      4.13.1  FORM OF POLICIES. Tenant shall, throughout the Lease Term, at its
              own expense, keep and maintain in full force and effect the
              following policies, each of which shall be endorsed as needed to
              provide that the insurance afforded by these policies is primary
              and that all insurance carried by Landlord is strictly excess and
              secondary and shall not contribute with Tenant's liability
              insurance:
              (a  A policy of commercial general liability insurance, including
                  a contractual liability endorsement covering Tenant's
                  obligations under the paragraph captioned "INDEMNIFICATION",
                  insuring against claims of bodily injury and death or property
                  damage or loss with a combined single limit at the
                  Commencement Date of this Lease of not less than Two Million
                  Dollars ($2,000,000.00) per occurrence, which limit shall be
                  reasonably increased during the Lease Term at Landlord's
                  reasonable request to reflect both increases in liability
                  exposure arising from inflation as well as from changing use
                  of the Premises or changing legal liability standards, which
                  policy shall be payable on an :occurrence" rather than a
                  "claims made" basis, and which policy identifies Landlord and
                  Manager and, at Landlord's request, Landlord's mortgage
                  lender(s) or investment advisors, as additional named
                  insureds;
              (b  A policy of extended property insurance (what is commonly
                  called "all risk") covering Tenant's Improvements and Tenant's
                  Alterations, furniture, fixtures, equipment, inventory, and
                  other personal property located on the Premises for one
                  hundred percent (100%) of the current replacement value of
                  such property;
              (c  Business interruption insurance in an amount sufficient to
                  cover costs, damages, lost income, expenses, Base Rent,
                  Additional Rent and all other sums payable under this Lease,
                  should any or all of the Premises not be usable for a period
                  of up to twelve (12) months;
              (d  A policy of worker's compensation insurance as required by law
                  and employer's liability insurance with limits of no less than
                  One Million Dollars ($1,000,000); and
              (e  A policy of comprehensive automobile liability insurance,
                  including loading and unloading, and covering owned, non-owned
                  and hired vehicles, with limits of no less than One Million
                  Dollars ($1,000,000) per occurrence.
      4.13.2  APPROVAL OF INSURER. All insurance policies required under this
              paragraph shall be with companies with a Best rating of AXII or
              better and each policy shall provide that it is not subject to
              cancellation or reduction in coverage except after thirty (30)
              days' written notice to Landlord. Tenant shall deliver to Landlord
              and, at Landlord's request Landlord's mortgage lender(s), prior to
              the Commencement Date and from time to time thereafter,
              certificates evidencing the existence and amounts of all such
              policies.

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<PAGE>

      4.13.3  LANDLORD OBTAINED INSURANCE. If Tenant fails to timely acquire or
              maintain any insurance or provide any certificate required by this
              paragraph, Landlord may, after thirty (30) days' prior written
              notice to Tenant (except in the event of emergency, as reasonably
              determined by Landlord, in which event only reasonable notice
              under the circumstances shall be required) but shall not be
              required to, obtain such insurance or certificates and the
              reasonable costs associated with obtaining such insurance or
              certificates shall be payable by Tenant to Landlord within five
              (5) days after demand.
4.14  LANDLORD'S INSURANCE. Landlord shall, commencing with Tenant's early entry
      period set forth in Section 2.3 above, and continuing throughout the Lease
      Term, keep and maintain in full force and effect:
      (a      A policy of commercial general liability insurance, insuring
              against claims of bodily injury and death or property damage or
              loss with a combined single limit at the Commencement Date of not
              less than Five Million Dollars ($5,000,000.00), which policy shall
              be payable on an "occurrence" rather than a "claims made" basis;
              and
      (b      A policy of extended property insurance (what is commonly called
              "all risk") covering the Building and Landlord's personal
              property, if any, located at the Building in the amount of one
              hundred percent (100%) of the then current replacement value of
              such property (specifically excluding Tenant Improvements, Tenant
              Alterations, or any or all furniture, fixtures, equipment,
              inventory, improvements or other property which was in or about
              the Premises at the time of the damage and was not owned by
              Landlord).
      (c      Landlord may, but shall not be required to, maintain other types
              of insurance as Landlord deems appropriate, including, but not
              limited to, property insurance coverage for earthquakes and floods
              in such amounts as Landlord deems appropriate. Such policies may
              be "blanket" policies which cover other properties owned by
              Landlord.
4.15  WAIVER OF SUBROGATION. Notwithstanding anything in this Lease to the
      contrary, Landlord and Tenant hereby each waive and release the other from
      any and all Claims or any loss or damage that may occur to the Land,
      Premises, Project or personal property located therein, by reason of fire
      or other casualty regardless of cause or origin, including the negligence
      or misconduct of Landlord, Tenant, Landlord's Agents or Tenant's Agents,
      but only to the extent of the insurance proceeds paid to such releasor
      under its policies of insurance or, if it fails to maintain the required
      policies, the insurance proceeds that would have been paid to such
      releasor if it had maintained such policies. Each party to this Lease
      shall promptly give to its insurance company written notice of the mutual
      waivers contained in this subparagraph, and shall cause its insurance
      policies to be properly endorsed, if necessary, to prevent the
      invalidation of any insurance coverages by reason of the mutual waivers
      contained in this subparagraph.
4.16  ASSIGNMENT AND SUBLETTING BY TENANT.
      4.16.1  RESTRICTIONS ON TRANSFER. Tenant shall not have the right to
              assign, transfer, mortgage or encumber this Lease in whole or in
              part, nor sublet the whole or any part of the Premises, nor allow
              the occupancy of all or any part of the Premises by another,
              without first obtaining Landlord's consent, which consent may not
              be unreasonably withheld or delayed. Notwithstanding any permitted
              assignment or subletting, Tenant shall at all times remain
              directly, primarily and fully responsible and liable for the
              payment of all sums payable under this

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<PAGE>

              Lease and for compliance with all of its other obligations as
              tenant under this Lease. Upon the occurrence of an Event of
              Default, if the Premises or any part of the Premises are then
              subject to an assignment or subletting, Landlord, in addition to
              any other remedies provided in this Lease or by law, may at its
              option collect directly from such assignee or subtenant all rents
              becoming due to Tenant under such assignment or sublease and apply
              such rents against any sums due to Landlord from Tenant under this
              Lease, and no such collection shall be construed to constitute a
              novation or release of Tenant from the further performance of
              Tenant's obligations under this Lease. Tenant makes an absolute
              assignment to Landlord of such assignments and subleases and any
              rent, security deposits and other sums payable under such
              assignments and subleases as collateral to secure the performance
              of the obligations of Tenant under this Lease; provided however,
              that, until an Event of Default occurs, Tenant shall, subject to
              Section 4.16.6 below, be entitled to collect the rent, security
              deposits and other sums payable under such assignments and
              subleases.
      4.16.2  LANDLORD CONSENT, PROCEDURE. In the event Tenant desires to assign
              this Lease or to sublet all or any portion of the Premises, Tenant
              shall give written notice of such desire to Landlord setting forth
              the name of the proposed subtenant or assignee, the proposed term,
              the nature of the proposed subtenant's or assignee's business to
              be conducted on the Premises, the rental rate, and any other
              particulars of the proposed subletting or assignment that Landlord
              may reasonably request. Without limiting the preceding sentence,
              Tenant shall also provide Landlord with: (a) such financial
              information as Landlord may reasonably request; and (b) a copy of
              the proposed sublease or assignment or letter of intent. Tenant
              shall pay to Landlord, upon Landlord's demand therefor, Landlord's
              reasonable attorneys' fees incurred in the review of such
              documentation and in documenting Landlord's consent, plus an
              administrative fee of $1,000.00 for processing such proposed
              assignment or sublease. Receipt of such fees shall not obligate
              Landlord to approve the proposed assignment or sublease.
      4.16.3  LANDLORD CONSENT, RELEVANT FACTORS. In determining whether to
              grant or withhold consent to a proposed assignment or sublease,
              Landlord may consider, and weigh, any factor it deems relevant in
              its reasonable discretion. Without limiting what may be construed
              as a factor considered by Landlord, Tenant agrees that any one or
              more of the following will be proper grounds for Landlord's
              disapproval of a proposed assignment or sublease:
              (a  The proposed assignee or subtenant does not, in Landlord's
                  good faith judgment, have financial worth or creditworthiness
                  equal to or greater than that of Tenant as of the execution
                  date of this Lease or sufficient financial worth to insure
                  full and timely performance under this Lease;
              (b  Landlord has received insufficient evidence of the financial
                  worth or creditworthiness of the proposed assignee or
                  subtenant to make the determination set forth in clause (b);
              (c  The proposed assignee or subtenant has a reputation for
                  disputes in contractual relations, failure to observe and
                  perform its contractual obligations in a timely and complete
                  manner or for negative business

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<PAGE>

                  relations in the business community for or otherwise as a
                  tenant of property or otherwise;
              (d  Intentionally Omitted;
              (e  Intentionally Omitted;
              (f  The use of the Premises by the proposed assignee or subtenant
                  will not be identical with the Permitted Uses;
              (g  In Landlord's judgment, the proposed assignee or subtenant is
                  engaged in a business, or the Premises or any part of the
                  Premises will be used in a manner, that is not in keeping with
                  the then standards of the Project, or that is not compatible
                  with the businesses of other tenants in the Project, or that
                  is inappropriate for the Project, or that will violate any
                  negative covenant as to use contained in any other lease of
                  space in the Project;
              (h  The use of the Premises by the proposed assignee or subtenant
                  will violate any Governmental Requirement or create a
                  violation of Access Laws;
              (i  Tenant is in default of any obligation of Tenant under this
                  Lease, or Tenant has defaulted under this Lease on three (3)
                  or more occasions during the twenty-four (24) months preceding
                  the date that Tenant shall request such consent;
              (j  Landlord does not approve of any of the tenant improvements
                  required for the proposed assignee or subtenant; or
              (k  Landlord has had contact with the proposed assignee or
                  subtenant, in the six (6) months preceding Tenant's request,
                  regarding the leasing of space by such proposed assignee or
                  subtenant in the Project or any other buildings owned by
                  Landlord in the metropolitan area in which the Land is
                  located.
      4.16.4  NOTICE REGARDING LANDLORD'S CONSENT. Within ten (10) Business Days
              after Landlord's receipt of all required information to be
              supplied by Tenant pursuant to this paragraph, Landlord shall
              notify Tenant of Landlord's approval, disapproval or conditional
              approval of any proposed assignment or subletting or of Landlord's
              election to require recapture as described below. Landlord shall
              have no obligation to respond unless and until all required
              information has been submitted. In the event Landlord approves of
              any proposed assignment or subletting, Tenant and the proposed
              assignee or sublessee shall execute and deliver to Landlord an
              assignment (or subletting) and assumption agreement in form and
              content satisfactory to Landlord in its sole discretion.
      4.16.5  AFFILIATE TRANSFER. Provided that the tangible net worth of the
              proposed transferee is reasonably satisfactory to Landlord, and
              provided that same is not intended as a subterfuge denying
              Landlord the benefits of this paragraph, a transfer to (1) any
              entity controlling, controlled by or under common control with
              Tenant (a "Corporate Affiliate"); (2) any entity with which Tenant
              has merged or consolidated, or (3) any entity which acquires all
              or substantially all of the shares of stock or assets of Tenant,
              and which continues to operate substantially the same business at
              the Premises as had been maintained by Tenant, shall be a
              permitted transfer which shall not require Landlord's consent
              hereunder (provided that Tenant shall provide Landlord with notice
              thereof). For purposes of determining whether an entity is a
              "Corporate Affiliate," the term "CONTROL" shall mean the ownership
              of substantially all of the outstanding

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<PAGE>

              voting stock of the corporation, or the possession of power to
              direct or control the direction of management and policy of such
              corporation.
      4.16.6  EXCESS RENT. If Landlord consents to any assignment or sublease
              and Tenant receives rent or any other consideration, either
              initially or over the term of the assignment or sublease, in
              excess of the Base Rent, Additional Rent and other regularly
              recurring charges under the Lease (or, in the case of a sublease
              of a portion of the Premises, in excess of the Base Rent,
              Additional Rent and other regularly recurring charges under the
              Lease paid by Tenant on a square footage basis under this Lease),
              Tenant shall pay to Landlord fifty percent (50%) of such excess,
              after deducting the reasonable expenses incurred by Tenant for (i)
              any changes, alterations and improvements to the Premises paid for
              by Tenant in connection with the assignment or sublease, (ii) any
              other out-of-pocket monetary concessions provided by Tenant to the
              transferee, (iii) any brokerage commissions paid for by Tenant in
              connection with the assignment or sublease, and (iv) any other
              normal and customary commercially reasonable out-of-pocket
              expenses that Tenant incurs directly in connection with the
              assignment or sublease.
      4.16.7  RECAPTURE. Landlord shall have the right to recapture the Premises
              or the applicable portion thereof (a "RECAPTURE") by giving
              written notice of such Recapture to Tenant within fifteen (15)
              Business Days after receipt of Tenant's written request for
              Landlord's consent to such proposed assignment or subletting.
              Notwithstanding the foregoing, Landlord shall not have such right
              of recapture during the first three (3) years of the initial Lease
              Term. Tenant shall have no right to retract its request for
              Landlord's consent to assign or sublease once such request has
              been made. Such Recapture shall terminate this Lease as to the
              applicable space effective on the prospective effective date of
              assignment or subletting, which shall be the last day of a
              calendar month and shall not be earlier than forty-five (45)
              Business Days after receipt of Tenant's request hereunder. If less
              than the entire Premises are recaptured, Landlord and Tenant agree
              that this Lease shall remain in full force and effect with respect
              to that remaining area not recaptured by Landlord. Tenant agrees
              to surrender that portion of the Premises recaptured by Landlord
              in accordance with the terms and conditions of this Lease.
              Notwithstanding the first sentence of this subparagraph, Landlord
              shall have no right to Recapture the Premises or applicable
              portion thereof if Tenant's proposed assignment or sublet is to an
              affiliate, wholly-owned subsidiary or successor entity.
      4.16.8  EARLY TRANSFER REQUEST. Notwithstanding the foregoing provisions
              of this Section 4.16, in the event that Tenant requests Landlord's
              consent to a proposed sublease during the first three (3) years of
              the Lease Term, and such sublease (a) is for less than one hundred
              twenty-one thousand (121,000) rentable square feet (and when
              combined with other subleases is for less than 121,000 rentable
              square feet in the aggregate), (b) unconditionally expires within
              the first four (4) years of the initial Lease Term, and (c) is not
              a subterfuge by Tenant to avoid Tenant's obligations under this
              Lease, then the following provisions shall apply: (i) Landlord
              shall approve or disapprove of such proposed sublease within ten
              (10) Business Days after receipt of Tenant's request thereto along
              with all information required to be provided by Tenant pursuant to
              this Section 4.16; failure to timely approve or disapprove shall

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<PAGE>

              constitute Landlord's approval thereto; (ii) Landlord shall not
              unreasonably withhold its consent to such proposed sublease, and
              may only withhold its consent for the following reasons:
              (A) The proposed subtenant does not, in Landlord's reasonable,
                  good faith judgment, have sufficient financial worth to insure
                  full and timely performance under this Lease, or Landlord has
                  received insufficient evidence to make such determination;
              (B) The proposed subtenant is engaged in a business, or the
                  Premises or any part of the Premises will be used in a manner,
                  that is not in keeping with the Permitted Use or the then
                  standards of the Project, or that is not reasonably compatible
                  with the businesses of other tenants in the Project, or that
                  will violate any negative covenant as to use contained in any
                  other lease of space in the Project;
              (C) The use of the Premises by the proposed subtenant will violate
                  any Governmental Requirement or create a violation of Access
                  Laws;
              (D) Landlord does not reasonably approve of any of the tenant
                  improvements required for the proposed subtenant; or
              (E) Landlord has had contact with the proposed subtenant, in the
                  six (6) months preceding Tenant's request, regarding the
                  leasing of space by such proposed subtenant in the Project,
                  and Landlord has space available in the Project that could
                  reasonably be leased to such proposed subtenant on similar
                  terms and conditions as are being offered by Tenant.
4.17  ASSIGNMENT BY LANDLORD. Landlord shall have the right to transfer and
      assign, in whole or in part, its rights and obligations under this Lease
      and in any and all of the Land or Building or Project. If Landlord sells
      or transfers any or all of the Project or Building, including the
      Premises, Landlord and Landlord's Agents shall, upon consummation of such
      sale or transfer, be released automatically from any liability relating to
      obligations or covenants under this Lease to be performed or observed
      after the date of such transfer, and in such event, provided that the
      transferee assumes Landlord's obligations hereunder in writing, Tenant
      agrees to look solely to Landlord's successor-in-interest with respect to
      such liability; PROVIDED THAT, as to the Security Deposit and Prepaid
      Rent, Landlord shall not be released from liability therefor unless
      Landlord has delivered (by direct transfer or credit against the purchase
      price) the Security Deposit or Prepaid Rent to its successor-in-interest.
4.18  ESTOPPEL CERTIFICATES AND FINANCIAL STATEMENTS. Tenant shall, from time to
      time, upon the written request of Landlord, execute, acknowledge and
      deliver to Landlord or its designee a written statement stating: (a) the
      date this Lease was executed and the date it expires; (b) the date Tenant
      entered into occupancy of the Premises; (c) the amount of monthly Base
      Rent and Additional Rent and the date to which such Base Rent and
      Additional Rent have been paid; and (d) certifying that (1) this Lease is
      in full force and effect and has not been assigned, modified, supplemented
      or amended in any way (or specifying the date of the agreement so
      affecting this Lease); (2) Landlord is not in breach of this Lease (or, if
      so, a description of each such breach) and that no event, omission or
      condition has occurred which would result, with the giving of notice or
      the passage of time or both, in a breach of this Lease by Landlord; (3)
      this Lease represents the entire agreement between the parties with
      respect to the Premises; (4) all required contributions by Landlord to
      Tenant on account of Tenant Improvements have been received; (5) on the
      date of execution, there exist no defenses or offsets which the

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<PAGE>

      Tenant has against the enforcement of this Lease by the Landlord; (6) no
      Base Rent, Additional Rent or other sums payable under this Lease have
      been paid in advance except for Base Rent and Additional Rent for the then
      current month or any prepaid rent as specified on the Estoppel
      Certificate; (7) no security has been deposited with Landlord (or, if so,
      the amount of such security); (8) it is intended that any Tenant's
      statement may be relied upon by a prospective purchaser or mortgagee of
      Landlord's interest or an assignee of any such mortgagee; and (9) such
      other information as may be reasonably requested by Landlord. If Tenant
      fails to respond within fifteen (15) days of its receipt of a written
      request by Landlord as provided in this paragraph, such shall be a breach
      of this Lease after an additional five (5) days notice from Landlord. In
      addition, Tenant shall, from time to time, upon the written request of
      Landlord, deliver to or cause to be delivered to Landlord or its designee
      then current financial statements (including a statement of operations and
      balance sheet) certified as accurate by a certified public accountant or
      financial officer of Tenant and prepared in conformance with generally
      accepted accounting principles for Tenant.
4.19  MODIFICATION FOR LENDER. If, in connection with obtaining construction,
      interim or permanent financing for the Building or Land, Landlord's
      lender, if any, shall demand commercially reasonable modifications to this
      Lease as an express condition to such financing, Tenant will not
      unreasonably withhold or delay its consent to such modifications; PROVIDED
      THAT, such modifications do not adversely affect the obligations of Tenant
      under this Lease or adversely affect Tenant's rights under this Lease.
4.20  HAZARDOUS SUBSTANCES.
      4.20.1  Tenant agrees that neither Tenant, any of Tenant's Agents nor any
              other person will store, place, generate, manufacture, refine,
              handle, or locate on, in, under or around the Land or Building or
              Project any Hazardous Substance, except for storage, handling and
              use of reasonable quantities and types of cleaning fluids and
              office supplies in the Premises in the ordinary course and the
              prudent conduct of Tenant's business in the Premises, PROVIDED
              THAT, (a) the storage, handling and use of such permitted
              Hazardous Substances must at all times conform to all Governmental
              Requirements and to applicable fire, safety and insurance
              requirements; (b) the types and quantities of permitted Hazardous
              Sub-stances which are stored in the Premises must be reason-able
              and appropriate to the nature and size of Tenant's operation in
              the Premises and reasonable and appropriate for a first-class
              building of the same or similar use and in the same market area as
              the Building; (c) no Hazardous Substance shall be spilled or
              disposed of on, in, under or around the Land or Building or
              Project or otherwise discharged from the Premises or any area
              adjacent to the Land or Building; and (d) in no event will Tenant
              be permitted to store, handle or use on, in, under or around the
              Premises any Hazardous Substance which will increase the rate of
              fire or extended coverage insurance on the Land or Building or
              Project, unless: (1) such Hazardous Substance and the expected
              rate increase have been specifically disclosed in writing to
              Landlord; (2) Tenant has agreed in writing to pay any rate
              increase related to each such Hazardous Substance; and (3)
              Landlord has approved in writing each such Hazardous Substance,
              which approval shall be subject to Landlord's discretion.
      4.20.2  Tenant shall indemnify, defend and hold harmless Landlord and
              Landlord's Agents from and against any and all Claims arising out
              of any breach of any provision of this paragraph, which expenses
              shall also include laboratory

                                       30
<PAGE>

              testing fees, personal injury claims, clean-up costs and
              environmental consultants' fees. Tenant agrees that Landlord may
              be irreparably harmed by Tenant's breach of this paragraph and
              that a specific performance action may appropriately be brought by
              Landlord; PROVIDED THAT, Landlord's election to bring or not bring
              any such specific performance action shall in no way limit, waive,
              impair or hinder Landlord's other remedies against Tenant.
      4.20.3  As of the execution date of this Lease, Tenant represents and
              warrants to Landlord that, except as otherwise disclosed by Tenant
              to Landlord, Tenant has no intent to bring any Hazardous
              Substances on, in or under the Premises except for the type and
              quantities authorized in the first paragraph of the paragraph
              captioned "HAZARDOUS SUBSTANCES".
              To Landlord's actual knowledge as of the date of the execution of
              this Lease, and without independent investigation and inquiry, (a)
              no Landlord's Hazardous Materials (defined below) have been
              handled in or about the Premises or Building by Landlord, except
              in compliance with all applicable laws, and (b) Landlord has not
              received any written notice of the presence of Hazardous Materials
              at the Premises or Building in violation of applicable laws. The
              term "Landlord Hazardous Materials" shall mean Hazardous Materials
              which are present in, on, under or about the Building or Premises
              as of the date of this Lease and which are released or brought in,
              on, under or about the Building or Premises by Landlord or any
              agent of Landlord. Landlord's Hazardous Materials shall
              specifically not include any Hazardous Materials released,
              disturbed, transported, stored, generated or used by Tenant or
              Tenant's Agents.
                  In the event of a breach of this Section during the Lease
              Term, then Landlord's sole obligation and responsibility to Tenant
              shall be (a) the commencement, within ninety (90) days after
              Landlord receives notice of such breach or discovery and verifies
              the accuracy of such claim, of a removal, encapsulation or other
              containment program reasonably elected by Landlord which is
              required by and complies with applicable laws, and (b) the
              diligent prosecution of such program to completion, at no cost to
              Tenant, in such a manner as will make the Premises or Building, as
              the case may be, in compliance with applicable laws.
4.21  ACCESS LAWS.
      4.21.1  NOTICE TO LANDLORD OF VIOLATION. Tenant agrees to notify Landlord
              immediately if Tenant receives notification or otherwise becomes
              aware of: (a) any condition or situation on, in, under or around
              the Land or Building which may constitute a violation of any
              Access Laws or (b) any threatened or actual lien, action or notice
              that the Land or Building is not in compliance with any Access
              Laws. If Tenant is responsible for such condition, situation,
              lien, action or notice under this paragraph, Tenant's notice to
              Landlord shall include a statement as to the actions Tenant
              proposes to take in response to such condition, situation, lien,
              action or notice.
      4.21.2  PROHIBITED ACTS. Tenant shall not alter or permit any assignee or
              subtenant or any other person to alter the Premises in any manner
              which would violate any Access Laws or increase Landlord's
              responsibilities for compliance with Access Laws, without the
              prior approval of the Landlord. In connection with any such
              approval, Landlord may require a certificate of compliance with
              Access Laws

                                       31
<PAGE>

              from an architect, engineer or other person acceptable to
              Landlord. Tenant agrees to pay the reasonable fees incurred by
              such architect, engineer or other third party in connection with
              the issuance of such certificate of compliance. Landlord's consent
              to any proposed Tenant Alteration shall (a) not relieve Tenant of
              its obligations or indemnities contained in this paragraph or this
              Lease or (b) be construed as a warranty that such proposed
              alternation complies with any Access Law.
      4.21.3  TENANT RESPONSIBILITY. Tenant shall be solely responsible for all
              costs and expenses relating to or incurred in connection with: (a)
              failure of the Premises to comply with the Access Laws; and (b)
              bringing the Building into compliance with Access Laws, if and to
              the extent such noncompliance arises out of or relates to: (1)
              Tenant's use of the Premises, including the hiring of employees;
              (2) any Tenant Alterations to the Premises; or (3) any Tenant
              Improvements constructed in the Premises by or at the request of
              Tenant, regardless of whether such improvements are constructed
              prior to or after the Commencement Date.
      4.21.4  LANDLORD RESPONSIBILITY. Landlord shall be responsible for all
              costs and expenses relating to or incurred in connection with
              bringing the common areas of the Building into compliance with
              Access Laws, unless such costs and expenses are Tenant's
              responsibility as provided in the preceding subparagraph. Any cost
              or expense paid or incurred by Landlord to bring the Premises or
              common areas of the Building into compliance with Access Laws
              which is not Tenant's responsibility under the preceding
              subparagraphs shall be amortized over the useful economic life of
              the improvements (not to exceed ten (10) years) using an
              amortization rate of twelve percent (12%) per annum, and shall be
              an Operating Cost for purposes of this Lease.
4.22  QUIET ENJOYMENT. Landlord covenants that Tenant, upon paying Base Rent,
      Additional Rent and all other sums payable under this Lease and performing
      all covenants and conditions required of Tenant under this Lease shall and
      may peacefully have, hold and enjoy the Premises without hindrance or
      molestation by Landlord, subject to the terms of this Lease, any ground
      lease, mortgage or deed of trust and all matters of record now or
      hereafter encumbering the Premises or the Project.
4.23  SIGNS. Tenant shall not inscribe an inscription, or post, place, or in any
      manner display any sign, notice, picture, placard or poster, or any
      advertising matter whatsoever, anywhere in or about the Land or Building
      or Project at places visible (either directly or indirectly as an outline
      or shadow on a glass pane) from anywhere outside the Premises without
      first obtaining Landlord's consent, which consent shall not be
      unreasonably withheld. The exact size, appearance and location of such
      sign shall be subject to Landlord's prior written approval and shall be
      consistent with Landlord's existing sign criteria then in existence for
      the Building. Any and all costs in connection with the permitting,
      fabrication, installation, maintenance and removal of Tenant's sign
      (including the cost of removal of the sign and repair to the Building
      caused by such removal) shall be borne by Tenant. Tenant agrees to
      maintain any such sign, awning, canopy, decoration, lettering, advertising
      matter or other thing as may be approved, in good condition at all times.
      Upon vacation of the Premises on the expiration or earlier termination of
      this Lease, Tenant shall be responsible, at its sole cost, for the removal
      of such sign or signs and the repair, painting and/or replacement of the
      structure to which the sign or signs were attached, including
      discoloration caused by such installation or

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      removal. If Tenant fails to perform such work, Landlord may cause the same
      to be performed, and the cost thereof shall be Additional Rent immediately
      due and payable upon rendition of a bill therefor.
4.24  SUBORDINATION. Provided Tenant is given written assurance in the
      applicable lender's standard subordination, non-disturbance and attornment
      form ("SNDA"), Tenant subordinates this Lease and all rights of Tenant
      under this Lease to any mortgage, deed of trust, ground lease or vendor's
      lien, or similar instrument which may from time to time be placed upon the
      Premises (and all renewals, modifications, replacements and extensions of
      such encumbrances), and each such mortgage, deed of trust, ground lease or
      lien or other instrument shall be superior to and prior to this Lease. At
      the request of Landlord, the holder of such mortgage or deed of trust or
      any ground Lessor, Tenant shall execute, acknowledge and deliver promptly
      in recordable form any instrument or subordination agreement that Landlord
      or such holder may request; provided, however, such instrument shall
      include a nondisturbance provision on the standard form of the applicable
      lender or ground lessor. Notwithstanding the foregoing, the holder or
      beneficiary of such mortgage, deed of trust, ground lease, vendor's lien
      or similar instrument shall have the right to subordinate or cause to be
      subordinated any such mortgage, deed of trust, ground lease, vendor's lien
      or similar instrument to this Lease. Tenant further covenants and agrees
      that if the lender or ground lessor acquires the Premises as a purchaser
      at any foreclosure sale or otherwise, and provided that Tenant is given an
      SNDA, Tenant shall recognize and attorn to such party as landlord under
      this Lease, and shall make all payments required hereunder to such new
      landlord without deduction or set-off and, upon the request of such
      purchaser or other successor, execute, deliver and acknowledge documents
      confirming such attornment. Tenant waives the provisions of any law or
      regulation, now or hereafter in effect, which may give or purport to give
      Tenant any right to terminate or otherwise adversely affect this Lease or
      the obligations of Tenant hereunder in the event that any such foreclosure
      or termination or other proceeding is prosecuted or completed.
4.25  INTENTIONALLY OMITTED.
4.26  BROKERS. As between Landlord and Tenant, Landlord will be responsible to
      pay the commissions due and owing to the above Brokers set forth in
      Section 1.6 above according to the terms and conditions of a separate
      agreement between Landlord and such Brokers. Each party to this Lease
      shall indemnify, defend and hold harmless the other party from and against
      any and all Claims asserted against such other party by any real estate
      broker, finder or intermediary relating to any act of the indemnifying
      party in connection with this Lease.
4.27  EXCULPATION AND LIMITATION OF LIABILITY. Landlord has executed this Lease
      by its trustee signing solely in a representative capacity.
      Notwithstanding anything contained in this Lease to the contrary, Tenant
      confirms that the covenants of Landlord are made and intended, not as
      personal covenants of the trustee, or for the purpose of binding the
      trustee personally, but solely in the exercise of the representative
      powers conferred upon the trustee by its principal. Liability with respect
      to the entry and performance of this Lease by or on behalf of Landlord,
      however it may arise, shall be asserted and enforced only against the
      lesser of (i) Landlord's estate and equity interest in the Building, or
      (ii) the equity interest that Landlord would have in and to the Building
      if the Building were encumbered by debt in an amount equal to eighty
      percent (80%) of the value of the Building. None of Landlord's Agents
      shall have any personal liability in the event of any claim against
      Landlord arising out of or in connection with this Lease, the relationship
      of

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      Landlord and Tenant or Tenant's use of the Premises. None of Tenant's
      Agents shall have any personal liability in the event of any claim against
      Tenant arising out of or in connection with this Lease or the relationship
      of Landlord and Tenant. Further, in no event whatsoever shall any
      Landlord's Agent have any liability or responsibility whatsoever arising
      out of or in connection with this Lease, the relationship of Landlord and
      Tenant or Tenant's use of the Premises. Any and all personal liability, if
      any, beyond that which may be asserted under this paragraph, is expressly
      waived and released by Tenant and by all persons claiming by, through or
      under Tenant.
4.28  INTENTIONALLY OMITTED.
4.29  MECHANIC'S LIENS AND TENANT'S PERSONAL PROPERTY TAXES.
      4.29.1  MECHANIC'S LIENS. Tenant shall have no authority, express or
              implied, to create or place any lien or encumbrance of any kind or
              nature whatsoever upon, or in any manner to bind, the interest of
              Landlord or Tenant in the Premises or to charge the rentals
              payable under this Lease for any Claims in favor of any person
              dealing with Tenant, including those who may furnish materials or
              perform labor for any construction or repairs. Tenant shall pay or
              cause to be paid all sums legally due and payable by it on account
              of any labor performed or materials furnished in connection with
              any work performed on the Premises on which any lien is or can be
              validly and legally asserted against its leasehold interest in the
              Premises and Tenant shall indemnify, defend and hold harmless
              Landlord from any and all Claims arising out of any such asserted
              Claims. Tenant agrees to give Landlord immediate written notice of
              any such Claim. Tenant shall notify Landlord in writing at least
              ten (10) Business Days in advance of any work to be done on, in,
              or about the Premises. In the event of such scheduled work,
              whether Landlord received notice from Tenant or not, Landlord
              shall have the right, at any time and from time to time, to enter
              the Premises to post notices of non-responsibility in such
              locations as Landlord deems appropriate. Landlord shall provide
              reasonable notice to Tenant in advance of entering the Premises
              for the purpose of posting the notices of non-responsibility.
      4.29.2  PERSONAL PROPERTY TAXES. Tenant shall be liable for all taxes
              levied or assessed against personal property, furniture or
              fixtures placed by Tenant in the Premises. If any such taxes for
              which Tenant is liable are levied or assessed against Landlord or
              Landlord's property and Landlord elects to pay them or if the
              assessed value of Landlord's property is increased by inclusion of
              such personal property, furniture or fixtures and Landlord elects
              to pay the taxes based on such increase, Tenant shall reimburse
              Landlord for the sums so paid by Landlord, upon demand by
              Landlord.

                         SECTION 5: DEFAULT AND REMEDIES

5.1   EVENTS OF DEFAULT.
      5.1.1   EVENTS OF DEFAULT. The occurrence of any one or more of the
              following events shall constitute a material default and breach of
              this Lease by Tenant ("Event of Default"):
              (a) abandonment (as defined in the California Civil Code) of all
                  or any portion of the Premises;

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<PAGE>

              (b) failure by Tenant to make any payment of Base Rent, Additional
                  Rent or any other sum payable by Tenant under this Lease
                  within ten (10) days after written notice from Landlord that
                  same is due;
              (c) failure by Tenant to observe or perform any covenant or
                  condition of this Lease, other than the making of payments,
                  where such failure shall continue for a period of twenty (20)
                  Business Days after written notice from Landlord;
              (d) (1) the making by Tenant of any general assignment or general
                  arrangement for the benefit of creditors; (2) the filing by or
                  against Tenant of a petition in bankruptcy, including
                  reorganization or arrangement, unless, in the case of a
                  petition filed against Tenant, unless the same is dismissed
                  within thirty (30) days; (3) the appointment of a trustee or
                  receiver to take possession of substantially all of Tenant's
                  assets located in the Premises or of Tenant's interest in this
                  Lease; (4) any execution, levy, attachment or other process of
                  law against any property of Tenant or Tenant's interest in
                  this Lease, unless the same is dismissed within thirty (30)
                  days; (5) adjudication that Tenant is bankrupt; (6) the making
                  by Tenant of a transfer in fraud of creditors; or (7) the
                  failure of Tenant to generally pay its debts as they become
                  due;
              (e) any information furnished by or on behalf of Tenant to
                  Landlord in connection with the entry of this Lease is
                  determined to have been materially false, misleading or
                  incomplete when made, and Tenant had notice that such
                  information was false, misleading or incomplete; or
              (f) any assignment, subletting or other transfer for which the
                  prior consent of Landlord is required under this Lease and has
                  not been obtained, after Tenant has notice and a reasonable
                  opportunity to cure (but in no event longer than 10 days to
                  cure).
      5.1.2   NOTICE OF DEFAULT. When this Lease requires service of a notice,
              that notice shall replace rather than supplement any equivalent or
              similar statutory notice, including any notices required by Code
              of Civil Procedure section 1161 or any similar or successor
              statute. When a statute requires service of a notice in a
              particular manner, service of that notice (or a similar notice
              required by this Lease) in the manner required by paragraph 6.1
              shall replace and satisfy the statutory service-of-notice
              procedures, including those required by Code of Civil Procedure
              section 1162 or any similar or successor statute.
      5.1.3   INTENTIONALLY OMITTED.
      5.1.4   TREATMENT AS UNEXPIRED LEASE. If a petition in bankruptcy is filed
              by or against Tenant, and if this Lease is treated as an
              "unexpired lease" under applicable bankruptcy law in such
              proceeding, then Tenant agrees that Tenant shall not attempt nor
              cause any trustee to attempt to extend the applicable time period
              within which this Lease must be assumed or rejected.
5.2   REMEDIES. If any Event of Default occurs, Landlord may at any time after
      such occurrence, with or without notice or demand except as stated in this
      paragraph, and without limiting Landlord in the exercise of any right or
      remedy at law which Landlord may have by reason of such Event of Default,
      exercise the rights and remedies, either singularly or in combination, as
      are specified or described in the subparagraphs of this paragraph.
      Landlord's duty to mitigate damages shall be as set forth in applicable
      California law, and shall not be expanded in any manner by any provision
      of this Lease.

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<PAGE>

      5.2.1   REMEDIES; TERMINATION AND RECOVERY OF POSSESSION. Landlord may
              terminate this Lease and recover possession of the Premises, in
              which case Tenant shall immediately surrender possession of the
              Premises to Landlord and, in addition to any other rights and
              remedies Landlord may have at law and in equity, Landlord shall
              have the following rights:
              (a) To re-enter the Premises (after notice required by applicable
                  law) then or at any time thereafter and remove all persons and
                  property and possess the Premises, without prejudice to any
                  other remedies Landlord may have by reason of Tenant's default
                  or of such termination, and Tenant shall have no further claim
                  hereunder.
              (b) To recover all damages incurred by Landlord by reason of the
                  default, including without limitation (i) the worth at the
                  time of the award of the payments, including interest, owed by
                  Tenant to Landlord under this Lease that were earned or
                  accrued but unpaid at the time of termination; (ii) the worth
                  at the time of the award of the amount by which the payments
                  owed by Tenant to Landlord under the Lease that would have
                  been earned or accrued after the date of termination until the
                  time of the award exceeds the amount of the loss of payments
                  owed by Tenant to Landlord under this Lease for the same
                  period that Tenant affirmatively proves could have been
                  reasonably avoided; (iii) the worth at the time of the award
                  of the amount by which the payments owed by Tenant to Landlord
                  for the balance of the Lease Term after the time of the award
                  exceeds the amount of the loss of payments owed by Tenant for
                  the same period that Tenant proves could have been reasonably
                  avoided; (iv) all costs incurred by Landlord in retaking
                  possession of the Premises and restoring them to good order
                  and condition; (v) all costs, including without limitation
                  brokerage commissions, advertising costs and restoration and
                  remodeling costs, incurred by Landlord in reletting the
                  Premises; plus (vi) any other amount, including without
                  limitation attorneys' fees and audit expenses, necessary to
                  compensate Landlord for all detriment proximately caused by
                  Tenant's failure to perform its obligations under this Lease
                  or which in the ordinary course of things would be likely to
                  result therefrom. "The worth at the time of the award," as
                  used in clauses (i) and (ii) of this paragraph, is to be
                  determined by computing interest as to each unpaid payment
                  owed by Tenant to Landlord under the Lease, at the highest
                  interest rate permitted by law. "The worth at the time of the
                  award," as referred to in clause (iii) of this paragraph, is
                  to be determined by discounting such amount, as of the time of
                  award, by the discount rate of the Federal Reserve Bank of San
                  Francisco at the time of the award plus one percent (1%).
              (c) To remove (subject to applicable law), at Tenant's sole risk,
                  any and all personal property in the Premises and place such
                  in a public or private warehouse or elsewhere at the sole cost
                  and expense and in the name of Tenant. Any such warehouser
                  shall have all of the rights and remedies provided by law
                  against Tenant as owner of such property. If Tenant shall not
                  pay the cost of such storage within thirty (30) days following
                  Landlord's demand, Landlord may, subject to the provisions of
                  applicable law, sell any or all such property at a public or
                  private sale in such manner

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<PAGE>

                  and at such times and places as Landlord deems proper, without
                  notice to or demand upon Tenant. Tenant waives all claims for
                  damages caused by Landlord's removal, storage or sale of the
                  property and shall indemnify and hold Landlord free and
                  harmless from and against any and all loss, cost and damage,
                  including without limitation court costs and attorneys' fees.
                  Tenant hereby irrevocably appoints Landlord as Tenant's
                  attorney-in-fact, coupled with an interest, with all rights
                  and powers necessary to effectuate the provisions of this
                  subparagraph 5.2.
      5.2.2   REMEDIES; RECOVER RENT AS IT BECOMES DUE. Landlord may elect, in
              its absolute discretion, to maintain Tenant's right to possession,
              in which case this Lease shall continue in effect whether or not
              Tenant shall have abandoned the Premises. In such event, Landlord
              may enforce all of Landlord's rights and remedies under this
              Lease, including the right to recover rent as it becomes due
              hereunder, and, at Landlord's election, to re-enter and relet the
              Premises on such terms and conditions as Landlord deems
              appropriate. Without limiting the generality of the foregoing,
              Landlord shall have the remedy described in California Civil Code
              Section 1951.4 (lessor may continue lease in effect after lessee's
              breach and abandonment and recover rent as it becomes due, if
              lessee has right to sublet or assign, subject only to reasonable
              limitations). Landlord may execute any lease made pursuant hereto
              in its own name, and Tenant shall have no right to collect any
              such rent or other proceeds. Landlord's re-entry and/or reletting
              of the Premises, or any other acts, shall not be deemed an
              acceptance of surrender of the Premises or Tenant's interest
              therein, a termination of this Lease or a waiver or release of
              Tenant's obligations hereunder. Landlord shall have the same
              rights with respect to Tenant's improvements and personal property
              as under Section 5.2.1 above, even though such re-entry and/or
              reletting do not constitute acceptance of surrender of the
              Premises or termination of this Lease.
      5.2.3   SUCCESSION TO TENANT RIGHTS.  Whether or not Landlord elects to
              terminate this Lease on account of any default by Tenant, Landlord
              may:
              (a) Terminate any sublease, license, concession, or other
                  consensual arrangement for possession entered into by Tenant
                  and affecting the Premises.
              (b) Choose to succeed to Tenant's interest in such an arrangement.
                  If Landlord elects to succeed to Tenant's interest in such an
                  arrangement, Tenant shall, as of the date of notice by
                  Landlord of that election, have no further right to, or
                  interest in, the rent or other consideration receivable under
                  that arrangement.
      5.2.4   RIGHTS AND REMEDIES CUMULATIVE. None of the foregoing remedial
              actions, singly or in combination, shall be construed as an
              election by Landlord to terminate this Lease unless Landlord has
              in fact given Tenant written notice that this Lease is terminated:
              an act by Landlord to maintain or preserve the Premises; any
              efforts by Landlord to relet the Premises; any repairs or
              alterations made by Landlord to the Premises; re-entry,
              repossession or reletting of the Premises by Landlord pursuant to
              this paragraph; or the appointment of a receiver, upon the
              initiative of Landlord, to protect Landlord's interest under this
              Lease. If Landlord takes any of the foregoing remedial action
              without terminating this Lease, Landlord may nevertheless at any
              time

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<PAGE>

              after taking any such remedial action terminate this Lease by
              written notice to Tenant.
      5.2.5   MONEY DAMAGES UPON RELETTING. If Landlord relets the Premises,
              Landlord shall apply the revenue from such reletting as follows:
              FIRST, to the payment of any indebtedness other than Base Rent,
              Additional Rent or any other sums payable under this Lease by
              Tenant to Landlord; SECOND, to the payment of any cost of
              reletting (including finders' fees and leasing commissions);
              THIRD, to the payment of the cost of any alterations,
              improvements, maintenance and repairs to the Premises; and FOURTH,
              to the payment of Base Rent, Additional Rent and other sums due
              and payable and unpaid under this Lease. Landlord shall hold and
              apply the residue, if any, to payment of future Base Rent,
              Additional Rent and other sums payable under this Lease as the
              same become due, and shall deliver the eventual balance, if any,
              to Tenant. Should revenue from letting during any month, after
              application pursuant to the foregoing provisions, be less than the
              sum of the Base Rent, Additional Rent and other sums payable under
              this Lease and Landlord's expenditures for the Premises during
              such month. Tenant shall be obligated to pay such deficiency to
              Landlord as and when such deficiency arises.
      5.2.6   REMEDIES NONEXCLUSIVE. Pursuit of any of the foregoing remedies
              shall not preclude Landlord's pursuit of any of the other remedies
              provided in this Lease or by law (all such remedies being
              cumulative), nor shall pursuit by Landlord of any remedy provided
              in this Lease constitute a forfeiture or waiver of any Base Rent,
              Additional Rent or other sum payable under this Lease or of any
              damages accruing to Landlord by reason of the violation of any of
              the covenants or conditions contained in this Lease.
5.3   RIGHT TO PERFORM. If Tenant shall fail to pay any sum of money, other than
      Base Rent or Additional Rent, required to be paid by it under this Lease
      or shall fail to perform any other act on its part to be performed under
      this Lease, and such failure shall continue for ten (10) Business Days
      after notice of such failure by Landlord, or such shorter time if
      reasonable under the circumstances, Landlord may, but shall not be
      obligated to, and without waiving or releasing Tenant from any obligations
      of Tenant, make such payment or perform such other act on Tenant's part to
      be made or performed as provided in this Lease. Landlord shall have (in
      addition to any other right or remedy of Landlord) the same rights and
      remedies in the event of the nonpayment of sums due under this paragraph
      as in the case of default by Tenant in the payment of Base Rent.
5.4   LANDLORD'S DEFAULT. Landlord shall not be in default under this Lease
      unless Landlord fails to perform obligations required of Landlord within
      twenty (20) Business Days after written notice is delivered by Tenant to
      Landlord and to the holder of any mortgages or deeds of trust
      (collectively, "LENDER") covering the Premises whose name and address
      shall have theretofore been furnished to Tenant in writing, specifying the
      obligation which Landlord has failed to perform; provided, however, that
      if the nature of Landlord's obligation is such that more than twenty (20)
      Business Days are required for performance, then Landlord shall not be in
      default if Landlord or Lender commences performance within such twenty
      (20) Business Day period and thereafter diligently prosecutes the same to
      completion. All obligations of Landlord hereunder shall be construed as
      covenants, not conditions. In the event of any default, breach or
      violation of Tenant's rights under this Lease by Landlord, Tenant's
      exclusive remedies shall be an action for specific performance or an
      action for actual damages. Tenant hereby waives

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<PAGE>

      the benefit of any laws granting it the right to perform Landlord's
      obligation, a lien upon the property of Landlord and/or upon rent due
      Landlord, or the right to terminate this Lease or withhold rent or any
      other amounts due hereunder on account of any Landlord default.
5.5   ACCEPTANCE OF RENT WITHOUT WAIVING RIGHTS. Under the paragraph captioned
      "NO WAIVER OF REMEDIES," Landlord may accept Tenant's payments without
      waiving any rights under this Lease, including rights under a previously
      served notice of default. If Landlord accepts partial payments which
      cumulatively are less than the sum owed after serving a notice of default,
      Landlord may nevertheless commence and pursue an action to enforce rights
      and remedies under the previously serviced notice of default without
      giving Tenant any further notice or demand.

                       SECTION 6: MISCELLANEOUS PROVISIONS

6.1   NOTICES. Any notice, approval, consent, request or written communication
      required or permitted to be delivered under this Lease shall be: (a) in
      writing; (b) transmitted by personal delivery, express or courier service,
      United States Postal Service in the manner described below; and (c) deemed
      to be delivered on the earlier of the date received or four (4) Business
      Days after having been deposited in the United States Postal Service,
      postage prepaid. Such writings shall be addressed to Landlord or Tenant,
      as the case may be, at the respective designated addresses set forth
      opposite their signatures, or at such other address(es) as they may, after
      the execution date of this Lease, specify by written notice delivered in
      accordance with this paragraph, with copies to the persons at the
      addresses, if any, designated opposite each party's signature. Those
      notices which contain a notice of breach or default or a demand for
      performance may be sent by any of the methods described in clause (b)
      above, but if transmitted by personal delivery or electronic means, shall
      also be sent concurrently by certified or registered mail, return receipt
      requested.
6.2   ATTORNEY'S FEES AND EXPENSES. In the event either party requires the
      services of an attorney in connection with enforcing the terms of this
      Lease, or in the event suit is brought for the recovery of Base Rent,
      Additional Rent or any other sums payable under this Lease or for the
      breach of any covenant or condition of this Lease, or for the restitution
      of the Premises to Landlord or the eviction of Tenant during the Lease
      Term or after the expiration or earlier termination of this Lease, the
      prevailing party shall be entitled to a reasonable sum for attorney's and
      paralegal's fees incurred at the trial or appellate levels and for all
      costs and expenses associated with such levels. The prevailing party shall
      be determined under Civil Code section 1717(b)(1) or any successor
      statute.
6.3   NO ACCORD AND SATISFACTION. No payment by Tenant or receipt by Landlord of
      an amount less than the Base Rent or Additional Rent or any other sum due
      and payable under this Lease shall be deemed to be other than a payment on
      account of the Base Rent, Additional Rent or other such sum, nor shall any
      endorsement or statement on any check or any letter accompanying any check
      or payment be deemed an accord and satisfaction, nor preclude Landlord's
      right to recover the balance of any amount payable or Landlord's right to
      pursue any other remedy provided in this Lease or at law.
6.4   SUCCESSORS; JOINT AND SEVERAL LIABILITY. Except as provided in the
      paragraph captioned "EXCULPATION AND LIMITATION OF LIABILITY" and subject
      to the paragraph captioned "ASSIGNMENT AND SUBLETTING BY LANDLORD", all of
      the covenants and conditions

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<PAGE>

      contained in this Lease shall apply to and be binding upon Landlord and
      Tenant and their respective heirs, executors, administrators, successors
      and assigns. In the event that more than one person, partnership, company,
      corporation or other entity is included in the term "Tenant", then each
      such person, partnership, company, corporation or other entity shall be
      jointly and severally liable for all obligations of Tenant under this
      Lease.
6.5   CHOICE OF LAW. This Lease shall be construed and governed by the laws of
      the state of California.
6.6   NO WAIVER OF REMEDIES. The waiver by Landlord of any covenant or condition
      contained in this Lease shall not be deemed to be a waiver of any
      subsequent breach of such covenant or condition nor shall any custom or
      practice which may develop between the parties in the administration of
      this Lease be construed to waive or lessen the rights of Landlord to
      insist on the strict performance by Tenant of all of the covenants and
      conditions of this Lease. No act or thing done by Landlord or Landlord's
      Agents during the Lease Term shall be deemed an acceptance or a surrender
      of the Premises, and no agreement to accept a surrender of the Premises
      shall be valid unless made in writing and signed by Landlord. The mention
      in this Lease of any particular remedy shall not preclude Landlord from
      any other remedy it might have, either under this Lease or at law, nor
      shall the waiver of or redress for any violation of any covenant or
      condition in this Lease or in any of the rules or regulations attached to
      this Lease or later adopted by Landlord, prevent a subsequent act, which
      would have originally constituted a violation, from having all the force
      and effect of an original violation. The receipt by Landlord of Base Rent,
      Additional Rent or any other sum payable under this Lease with knowledge
      of a breach of any covenant or condition in this Lease shall not be deemed
      a waiver of such breach. The failure of Landlord to enforce any of the
      rules and regulations attached to this Lease or later adopted, against
      Tenant or any other tenant in the Project, shall not be deemed a waiver.
      Any waiver by Landlord must be in writing and signed by Landlord to be
      effective.
6.7   OFFER TO LEASE. The submission of this Lease to Tenant or its broker or
      other agent does not constitute an offer to Tenant to lease the Premises.
      This Lease shall have no force or effect until: (a) it is executed and
      delivered by Tenant to Landlord; and (b) it is executed and delivered by
      Landlord to Tenant.
6.8   FORCE MAJEURE. In the event that Landlord shall be delayed, hindered in or
      prevented from the performance of any act or obligation required under
      this Lease by reason of acts of God, strikes, lockouts, labor troubles or
      disputes, inability to procure or shortage of materials or labor, failure
      of power or utilities, delay in transportation, fire, vandalism, accident,
      flood, severe weather, other casualty, Governmental Requirements
      (including mandated changes in the Shell Specifications or the Shell Work
      resulting from changes in pertinent Governmental Requirements or
      interpretations thereof), riot, insurrection, civil commotion, sabotage,
      explosion, war, natural or local emergency, acts or omissions of others,
      including Tenant, or other reasons of a similar or dissimilar nature not
      solely the fault of, or under the exclusive control of, Landlord, then
      performance of such act shall be excused for the period of the delay and
      the period for the performance of any such act shall be extended for the
      period equivalent to the period of such delay.
6.9   LANDLORD'S CONSENT. Unless otherwise provided in this Lease (including
      where expressly provided in this Lease that Landlord may not unreasonably
      withhold its consent), whenever Landlord's consent, approval or other
      action is required under the terms of this Lease, such consent, approval
      or action shall be in writing and shall be subject to Landlord's good
      faith business judgment or discretion.

                                       40
<PAGE>

6.10  SEVERABILITY; CAPTIONS. If any clause or provision of this Lease is
      determined to be illegal, invalid, or unenforceable under present or
      future laws, the remainder of this Lease shall not be affected by such
      determination, and in lieu of each clause or provision that is determined
      to be illegal, invalid or unenforceable, there be added as a part of this
      Lease a clause or provision as similar in terms to such illegal, invalid
      or unenforceable clause or provision as may be possible and be legal,
      valid and enforceable. Headings or captions in this Lease are added as a
      matter of convenience only and in no way define, limit or otherwise affect
      the construction or interpretation of this Lease.
6.11  INTERPRETATION. Whenever a provision of this Lease uses the term (a)
      "include" or "including", that term shall not be limiting but shall be
      construed as illustrative, (b) "covenant", that term shall include any
      covenant, agreement, term or provision, and (c) "at law", that term shall
      mean at law or in equity, or both. This Lease shall be given a fair and
      reasonable interpretation of the words contained in it without any weight
      being given to whether a provision was drafted by one party or its
      counsel.
6.12  INCORPORATION OF PRIOR AGREEMENT; AMENDMENTS. This Lease contains all of
      the agreements of the parties to this Lease with respect to any matter
      covered or mentioned in this Lease, and no prior agreement or
      understanding pertaining to any such matter shall be effective for any
      purpose. No provision of this Lease may be amended or added to except by
      an agreement in writing signed by the parties to this Lease or their
      respective successors in interest.
6.13  AUTHORITY. If Tenant is a partnership, company, corporation or other
      entity, each individual executing this Lease on behalf of Tenant
      represents and warrants to Landlord on behalf of Tenant that he or she is
      duly authorized to so execute and deliver this Lease and that all
      partnership, company, corporation or other entity actions and consents
      required for execution of this Lease on behalf of Tenant have been given,
      granted or obtained. Landlord represents and warrants to Tenant that it is
      duly authorized to execute and deliver this Lease and that all
      partnership, company, corporation or other entity actions and consents
      required for execution of this Lease have been given, granted or obtained.
      If Tenant is a partnership, company, corporation or other business
      organization, it shall, within ten (10) Business Days after demand by
      Landlord, deliver to Landlord satisfactory evidence of the due
      authorization of this Lease and the authority of the person executing this
      Lease on its behalf.
6.14  TIME OF ESSENCE. Time is of the essence with respect to the performance of
      every covenant and condition of this Lease.
6.15  SURVIVAL OF OBLIGATIONS. Notwithstanding anything contained in this Lease
      to the contrary or the expiration or earlier termination of this Lease,
      any and all obligations of either party accruing prior to the expiration
      or termination of this Lease shall survive the expiration or earlier
      termination of this Lease, and either party shall promptly perform all
      such obligations whether or not this Lease has expired or terminated. Such
      obligations shall include any and all indemnity obligations set forth in
      this Lease.
6.16  INTENTIONALLY OMITTED.
6.17  LANDLORD'S AUTHORIZED AGENTS. Notwithstanding anything contained in the
      Lease to the contrary, including without limitation, the definition of
      Landlord's Agents, only officers of Riggs Bank N.A., are authorized to
      amend, renew or terminate this Lease, or to compromise any of
      Landlord's claims under this Lease or to bind Landlord in any manner.
      Without limiting the effect of the previous sentence, no property manager
      or broker shall be considered an authorized agent of Landlord to amend,
      renew or

                                       41
<PAGE>

      terminate this Lease or to compromise any of Landlord's claims under this
      Lease or to bind Landlord in any manner.
6.18  EDISON LEASE. Notwithstanding anything to the contrary set forth in this
      Lease, Tenant acknowledges that pursuant to that certain license agreement
      (the Edison Lease") to be entered into by and between Southern California
      Edison ("Edison") and Landlord affecting the Project (a preliminary draft
      of which Tenant acknowledges as having been received by Tenant), certain
      lease payments shall be required to be made by the Project owner to Edison
      in consideration of the Project owner's right to build along Edison's
      right of way at the Project. Tenant hereby agrees to comply with the terms
      and conditions of the Edison Lease to the extent they apply to areas
      covered by the terms of this Lease. Tenant further agrees that,
      notwithstanding anything to the contrary contained in this Lease, all
      payments and other charges under the Edison Lease shall be included as
      part of Operating Costs for the Building.
6.19  WAIVER OF JURY TRIAL. LANDLORD AND TENANT BY PLACING THEIR INITIALS AT THE
      END OF THIS PARAGRAPH HEREBY IRREVOCABLY WAIVE THEIR RESPECTIVE RIGHTS TO
      TRIAL BY JURY OF ANY CONTRACT OR TORT CLAIM, COUNTERCLAIM,
      CROSS-COMPLAINT, OR CAUSE OF ACTION IN ANY ACTION, PROCEEDING,
      COUNTERCLAIM, OR HEARING BROUGHT BY EITHER PARTY AGAINST THE OTHER ON ANY
      MATTER ARISING OUT OF OR RELATING IN ANY WAY TO THIS LEASE, THE
      RELATIONSHIP OF LANDLORD AND TENANT, OR TENANT'S USE OR OCCUPANCY OF THE
      PREMISES, INCLUDING ANY CLAIM OF INJURY OR DAMAGE OR THE ENFORCEMENT OF
      ANY REMEDY UNDER ANY CURRENT OR FUTURE LAW, STATUTE, REGULATION, CODE OR
      ORDINANCE.

      [Landlord's Initials]: /s/   MAM          [Tenant's Initials]: /s/   M.C.
                             ---------                               ----------

      IN WITNESS WHEREOF, this Lease has been executed the day and year first
above set forth.

                                       42
<PAGE>

<TABLE>
<CAPTION>

DESIGNATED ADDRESS FOR LANDLORD          LANDLORD

<S>                                      <C>
Haven Gateway LLC                        Haven Gateway LLC, a Delaware limited
c/o Riggs & Company,                     liability company
   a Division of Riggs Bank, N.A.
808 17th Street N.W.                     By:   Riggs & Company, a division of
Washington D.C.  20006                         Riggs Bank N.A., as Trustee of
Attn:  Senior Asset Manager/Mary Anne          the Multi-Employer Property
Martins                                        Trust, Its Sole Member
Voice:  202-835-4997
Facsimile:  202-835-6887
                                               By:  /s/ Mary Anne Martins
                                                    ---------------------

                                               Name:  Mary Anne Martins
                                                      -----------------

                                               Its:  Managing Director
                                                     -----------------

WITH COPY TO MANAGER:

Investment Development Services, Inc.
Attn:  Dean Nucich
888 West Sixth Street, 9th Floor
Los Angeles, California 90017
Voice:  213-362-9300
Facsimile:  213-627-9937

Designated Address for Tenant:           TENANT:

915 Secaucus Road                        The Children's Place Retail Stores,
Secaucus, New Jersey 07094               Inc., a Delaware corporation

                                         By:  /s/  Mario Ciampi
                                              -----------------
Facsimile: (201) 558-2840
                                         Name:  Mario Ciampi
                                                ------------
                                         Its:  Senior Vice-President
                                               ---------------------

                                         By:  /s/  Steven Balasiano
                                              ---------------------

                                         Name:  Steven Balasiano
                                                ----------------
                                         Its: Vice President and General Counsel
                                              ----------------------------------
</TABLE>

                                       43
<PAGE>

                             LANDLORD ACKNOWLEDGMENT

                              )
DISTRICT OF COLUMBIA          ) SS.
                              )

      On this _____ day of _______________, 2000, before me personally appeared
_________________________, to me known to be a _____________________ of Riggs &
Company, a division of Riggs Bank N.A., the Trustee of the Multi-Employer
Property Trust, the national banking association that executed the within and
foregoing instrument, and acknowledged said instrument to be the free and
voluntary act and deed of said national banking association as trustee, for the
uses and purposes therein mentioned, and on oath stated that __________ was
authorized to execute said instrument.

      IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal the day and year first above written.

                              _______________________________________________
                              NAME: _________________________________________
                              NOTARY PUBLIC IN AND FOR THE DISTRICT OF COLUMBIA,
                              RESIDING AT ____________________. MY APPOINTMENT
                              EXPIRES: ______________________.

___________

                                       44
<PAGE>

                       TENANT ACKNOWLEDGMENT (CORPORATION)

STATE OF NEW JERSEY           )
                              ) ss.
COUNTY OF HUDSON              )

      On this _______ day of AUGUST, 2000, before me, a Notary Public in and for
the of ___________________________, personally appeared MARIO CIAMPI, the SENIOR
VICE PRESIDENT of THE CHILDREN'S PLACE, the DELAWARE corporation that executed
the within and foregoing instrument, and acknowledged said instrument to be the
free and voluntary act and deed of said corporation for the uses and purposes
therein mentioned, and on oath stated that s/he/they was/were authorized to
execute said instrument.

      WITNESS my hand and official seal hereto affixed the day and year first as
above written.

                              _______________________________________________
                              Name:  LAUREL ANDERSEN
                              NOTARY PUBLIC in and for the District of Columbia,
                              residing at ____________________.  My appointment
                              expires:  7/9/05.

 [NOTARIAL SEAL]

                                       45
<PAGE>

                               EXHIBIT A to Lease

                            LEGAL DESCRIPTION OF LAND

                                       46
<PAGE>

                               EXHIBIT B to Lease

                    DRAWING SHOWING LOCATION OF THE PREMISES

                                       47
<PAGE>

                               EXHIBIT C to Lease
                     WORK LETTER AND CONSTRUCTION AGREEMENT
                       (Tenant to Construct Improvements)

      This Work Letter and Construction Agreement (this "Tenant Work Letter")
shall set forth the terms and conditions relating to the construction of the
Premises. This Tenant Work Letter is essentially organized chronologically and
addresses the issues of the construction of the Premises, in sequence, as such
issues will arise during the actual construction of the Premises. All references
in this Tenant Work Letter to Articles or Sections of "this Lease" shall mean
the relevant portions of the Lease to which this Tenant Work Letter is attached
as Exhibit C, and all references in this Tenant Work Letter to Sections of "this
Tenant Work Letter" shall mean the relevant portions of this Tenant Work Letter.
All general contractors and all subcontractors in connection with the Tenant
Improvements shall satisfy those union labor requirements set forth in the Lease
in the paragraph captioned "Tenant's Work Performance"; provided however, that
with respect to the installation in the Premises of the trade fixtures set forth
on Exhibit "F" attached hereto, if union labor is not available to properly
perform the installation of such trade fixtures, Tenant may utilize the services
of any other qualified sub-contractors which normally and regularly perform
similar work in similar industrial buildings and who are reasonably approved by
Landlord in writing in accordance with Section 4.1.2 below. The Tenant
Improvement Allowance may only be used for items of general construction to be
permanently affixed to the Premises, but not personal property or trade fixtures
(including the trade fixtures referenced in the immediately preceding sentence).

                                    SECTION 1

                          DELIVERY OF THE BASE BUILDING

      Landlord shall, at its sole cost and expense, perform the following work
in connection with this Lease (collectively, the "Shell Work"): design and
construct the shell of the Building (the "Base Building"), using Landlord's
standard guidelines, materials, specifications and procedures, substantially in
accordance with the specifications set forth on Schedule "1" attached hereto
(the "Shell Specifications"). Additionally, Landlord shall assign to Tenant on a
non-exclusive basis, to the extent assignable, all warranties and guaranties
relating to the Base Building. Tenant shall look to such warranties and
guaranties in the event of defects in the design and/or construction of the Base
Building, Landlord shall have no responsibility in connection therewith, and
Landlord shall have no liability whatsoever in connection with the design and
construction of the Base Building. Landlord shall, at no cost or expense to
Landlord, use commercially reasonable efforts to assist Tenant in the
enforcement of such warranties and guaranties. Upon the date of Substantial
Completion, Landlord shall deliver the Base Building to Tenant, and upon such
delivery, Tenant shall accept the same from Landlord in its then-existing
"as-is" condition.

                                    SECTION 2

                               TENANT IMPROVEMENTS

      2.1   Tenant Improvement Allowance.

                                       48
<PAGE>

            2.1.1 Tenant shall be entitled to a one-time tenant improvement
allowance ("Tenant Improvement Allowance") in the amount of Four Hundred Thirty
Five Thousand Two Hundred Ninety One and 50/100 Dollars ($435,291.50) for the
cost relating to the initial design and the actual cost of constructing the
Tenant Improvements. Except as expressly set forth below in Section 2.1.2, in no
event shall Landlord be obligated to make disbursements pursuant to this Tenant
Work Letter in a total amount which exceeds the Tenant Improvement Allowance.

            2.1.2 If the cost of the Tenant Improvements is budgeted to exceed
the Tenant Improvement Allowance, Tenant may request in writing, within thirty
(30) days after the date of the Lease, that Landlord pay up to an additional
Three Hundred Sixty Three Thousand Eight Hundred Fifty Three and 69/100 Dollars
($363,853.69) (the "Excess Allowance") to be utilized solely for the
construction of the Tenant Improvements. Tenant shall repay the Excess Allowance
to Landlord as follows: concurrently with its payments to Landlord of monthly
Base Rent, Tenant shall pay the amounts necessary to fully amortize the Excess
Allowance over the initial Lease Term, together with interest at the rate of
eleven percent (11%) per annum, with such amortized payments being due and
payable by Tenant monthly (together with Base Rent) commencing on the
Commencement Date and continuing through the expiration of the initial Lease
Term. If the Lease is canceled or terminated for any reason prior to the
expiration of the full initial Lease Term, then the unamortized Excess Allowance
shall become immediately due and payable to Landlord. If Tenant timely requests
the Excess Allowance, then the Excess Allowance shall be deemed part of the
Tenant Improvement Allowance for purposes of this Work Letter Agreement, subject
to Tenant's repayment obligations set forth in this Section 2.1.2 above. Upon
Landlord's demand, Tenant shall execute an amendment to the Lease, on Landlord's
form, to reflect the additional rent.

      2.2   Disbursement of the Tenant Improvement Allowance

            2.2.1 Tenant Improvement Allowance Items. Except as otherwise set
forth in this Tenant Work Letter, the Tenant Improvement Allowance shall be
disbursed by Landlord only for the following items and costs (collectively the
"Tenant Improvement Allowance Items"):

                  2.2.1.1 Notwithstanding anything to the contrary set forth
herein, costs for the payment of the fees of the "Architect" and the
"Engineers", as those terms are defined in Section 3.1 of this Tenant Work
Letter, shall not exceed an aggregate amount equal to $3.50 for each usable
square foot of space in the Premises;

                  2.2.1.2 The payment of plan check, permit and license fees
relating to construction of the Tenant Improvements;

                  2.2.1.3 The cost of construction of the Tenant Improvements,
including, without limitation, testing and inspection costs and trash removal
costs, and contractors' fees and general conditions;

                  2.2.1.4 The cost of any changes in the Base Building when such
changes are required by the Construction Drawings (including if such changes are
due to the fact that such work is prepared on an unoccupied basis), such cost to
include all direct architectural and/or engineering fees and expenses incurred
in connection therewith;

                                       49
<PAGE>

                  2.2.1.5 The cost of any changes to the Construction Drawings
or Tenant Improvements required by Code;

                  2.2.1.6 Sales and use taxes and Title 24 fees; and

                  2.2.1.7 Payment to Landlord of a construction supervisor fee
equal to four percent (4%) of the construction costs of the Tenant Improvements
covered by the Tenant Improvement Allowance (which fee shall be inclusive of the
out-of-pocket costs incurred by Landlord in connection with the supervision of
the Tenant Improvements, but shall not include all other amounts due to Landlord
under this Work Letter and the Lease).

                  2.2.1.8 All other costs to be expended by Tenant and
reasonably approved Landlord in connection with the construction of the Tenant
Improvements.

            2.2.2 Disbursement of Tenant Improvement Allowance. During the
construction of the Tenant Improvements, Landlord shall make monthly
disbursements of the Tenant Improvement Allowance for Tenant Improvement
Allowance Items for the benefit of Tenant and shall authorize the release of
monies for the benefit of Tenant as follows:

                  2.2.2.1 Disbursements. On or before each of (a) the thirtieth
(30th) day following Substantial Completion, and (b) the sixtieth (60th) day
following Substantial Completion, Tenant shall deliver to Landlord: (i) a
request for payment of the "Contractor", as that term is defined in Section 4.1
of this Tenant Work Letter, approved by Tenant, in a form to be provided by
Landlord, showing the schedule, by trade, of percentage of completion of the
Tenant Improvements in the Premises, detailing the portion of the work completed
and the portion not completed; (ii) invoices from all of "Tenant's Agents", as
that term is defined in Section 4.1.2 of this Tenant Work Letter, for labor
rendered and materials delivered to the Premises; (iii) executed mechanic's lien
releases from all of Tenant's Agents which shall comply with the appropriate
provisions, as reasonably determined by Landlord, of California Civil Code
Section 3262(d); and (iv) all other information reasonably requested by
Landlord. Tenant's request for payment shall be deemed Tenant's acceptance and
approval of the work furnished and/or the materials supplied as set forth in
Tenant's payment request. On or before the last day of the month following each
date in (a) and (b) above, Landlord shall deliver a check to Tenant made payable
to Tenant in payment of the lesser of: (A) the amounts so requested by Tenant,
as set forth in this Section 2.2.2.1, above, less a ten percent (10%) retention
(the aggregate amount of such retentions to be known as the "Final Retention"),
and (B) the balance of any remaining available portion of the Tenant Improvement
Allowance (not including the Final Retention), provided that Landlord does not
dispute any request for payment based on a non-compliance of any work with the
"Approved Working Drawings", as that term is defined in Section 3.4 below, or
due to any substandard work. Landlord's payment of such amounts shall not be
deemed Landlord's approval or acceptance of the work furnished or materials
supplied as set forth in Tenant's payment request.

                  2.2.2.2 Final Retention. Subject to the provisions of this
Tenant Work Letter, a check for the Final Retention payable to Tenant shall be
delivered by Landlord to Tenant following the completion of construction of the
Premises, provided that (i) Tenant delivers to Landlord a waiver and release in
accordance with the terms of California Civil Code Section 3262(d)(2) and a
waiver and release in accordance with either California Civil Code

                                       50
<PAGE>

Section 3262(d)(3) or Section 3262(d)(4), (ii) Landlord has determined that no
substandard work exists which adversely affects the mechanical, electrical,
plumbing, heating, ventilating and air conditioning, life-safety or other
systems of the Project, the curtain wall of the Project, the structure or
exterior appearance of the Project, or any other tenant's use of such other
tenant's leased premises in the Project and (iii) Architect delivers to Landlord
a certificate, in a form reasonably acceptable to Landlord, certifying that the
construction of the Tenant Improvements in the Premises has been substantially
completed.

                  2.2.2.3 Other Terms. Landlord shall only be obligated to make
disbursements from the Tenant Improvement Allowance to the extent costs are
incurred by Tenant for Tenant Improvement Allowance Items. All Tenant
Improvement Allowance Items for which the Tenant Improvement Allowance has been
made available shall be deemed Landlord's property under the terms of this
Lease.

                                    SECTION 3

                              CONSTRUCTION DRAWINGS

      3.1 Selection of Architect/Construction Drawings. Tenant shall retain an
architect reasonably approved by Landlord (the "Architect") to prepare the
Construction Drawings. Landlord shall either approve or disapprove of Tenant's
proposed Architect within three (3) Business Days after Tenant submits the name
of, and reasonable information with respect to, its proposed architect to
Landlord; failure by Landlord to approve or disapprove within such three (3)
Business Day period shall constitute Landlord's approval of Tenant's proposed
architect. Tenant shall retain the engineering consultants designated by
Landlord (the "Engineers") to prepare all plans and engineering working drawings
relating to the structural, mechanical, electrical, plumbing, HVAC, life-safety,
and sprinkler work in the Premises, which work is not part of the Base Building.
The plans and drawings to be prepared by Architect and the Engineers hereunder
shall be known collectively as the "Construction Drawings". All Construction
Drawings shall comply with the drawing format and specifications acceptable to
Landlord. Tenant and Architect shall verify, in the field, the dimensions and
conditions as shown on the relevant portions of the base building plans, and
Tenant and Architect shall be solely responsible for the same, and Landlord
shall have no responsibility in connection therewith. Landlord's review of the
Construction Drawings as set forth in this Section 3, shall be for its sole
purpose and shall not imply Landlord's review of the same, or obligate Landlord
to review the same, for quality, design, Code compliance or other like matters.
Accordingly, notwithstanding that any Construction Drawings are reviewed by
Landlord or its space planner, architect, engineers and consultants, and
notwithstanding any advice or assistance which may be rendered to Tenant by
Landlord or Landlord's space planner, architect, engineers, and consultants,
Landlord shall have no liability whatsoever in connection therewith and shall
not be responsible for any omissions or errors contained in the Construction
Drawings, and Tenant's waiver and indemnity set forth in this Lease shall
specifically apply to the Construction Drawings.

      3.2 Approved Working Drawings. Landlord shall approve (or disapprove)
working drawings prepared by Architect within five (5) days after Landlord
receives the final Working Drawings (the "Approved Working Drawings"). Tenant
shall submit the same to the City of Ontario and diligently pursue its receipt
of all applicable building permits. Tenant hereby agrees that neither Landlord
nor Landlord's consultants shall be responsible for obtaining any building

                                       51
<PAGE>

permit or certificate of occupancy for the Premises and that obtaining the same
shall be Tenant's responsibility; provided, however, that Landlord shall
cooperate with Tenant in executing permit applications and performing other
ministerial acts reasonably necessary to enable Tenant to obtain any such permit
or certificate of occupancy. No changes, modifications or alterations in the
Approved Working Drawings may be made without the prior written consent of
Landlord, which consent may not be unreasonably withheld.

                                    SECTION 4

                     CONSTRUCTION OF THE TENANT IMPROVEMENTS

      4.1   Tenant's Selection of Contractors.

            4.1.1 The Contractor. A general contractor shall be retained by
Tenant to construct the Tenant Improvements and Tenant shall contract directly
with such "Contractor". Landlord shall file a Notice of Non-Responsibility
regarding payments under Tenant's contract with the Contractor. Such general
contractor ("Contractor") must be approved in writing by Landlord, which
approval shall not be unreasonably withheld. Landlord shall either approve or
disapprove of Tenant's proposed general contractor within three (3) Business
Days after Tenant submits the name of, and reasonable information with respect
to, its proposed general contractor; failure to approve or disapprove within
such three (3) Business Day period shall constitute Landlord's approval of
Tenant's proposed general contractor.

            4.1.2 Tenant's Agents. All subcontractors, laborers, materialmen,
and suppliers used by Tenant (such subcontractors, laborers, materialmen, and
suppliers, and the Contractor to be known collectively as "Tenant's Agents")
must be approved in writing by Landlord, which approval shall not be
unreasonably withheld or delayed. Landlord shall either approve or disapprove of
Tenant's proposed subcontractors, laborers, materialmen or suppliers within
three (3) Business Days after Tenant submits the names of, and reasonable
information with respect to, the same to Landlord; failure to approve or
disapprove within such three (3) Business Day period shall constitute Landlord's
approval of the proposed subcontractors, laborers, materialmen or suppliers. If
Landlord does not approve any of Tenant's proposed subcontractors, laborers,
materialmen or suppliers, Tenant shall submit other proposed subcontractors,
laborers, materialmen or suppliers for Landlord's written approval.

      4.2   Construction of Tenant Improvements by Tenant's Agency.

            4.2.1 Construction Contract; Cost Budget. Prior to Tenant's
execution of the construction contract and general conditions with Contractor
(the "Contract"), Tenant shall submit the Contract to Landlord for its approval
with regard to proper insurance and licensing requirements and any other areas
which may adversely affect Landlord's interest in the Project, and which
approval shall not be unreasonably withheld or delayed by more than five (5)
business days after Landlord's receipt of the Contract. Prior to the
commencement of the construction of the Tenant Improvements, and after Tenant
has accepted all bids for the Tenant Improvements, Tenant shall provide Landlord
with a detailed breakdown, by trade, of the final costs to be incurred or which
have been incurred in connection with the design and construction of the Tenant
Improvements to be performed by or at the direction of Tenant or the Contractor,
which costs form a basis for the amount of the Contract (the "Final Costs").
Prior to the

                                       52
<PAGE>

commencement of construction of the Tenant Improvements, Tenant shall supply
Landlord with cash in an amount (the "Over-Allowance Amount") equal to the
difference between the amount of the Final Costs and the amount of the Tenant
Improvement Allowance (less any portion thereof already disbursed by Landlord,
or in the process of being disbursed by Landlord, on or before the commencement
of construction of the Tenant Improvements). The Over-Allowance Amount shall be
disbursed by Landlord prior to the disbursement of any of the then remaining
portion of the Tenant Improvement Allowance, and such disbursement shall be
pursuant to the same procedure as the Tenant Improvement Allowance. In the event
that, after the Final Costs have been delivered by Tenant to Landlord, the costs
relating to the design and construction of the Tenant Improvements shall change,
any additional costs necessary to such design and construction in excess of the
Final Costs, shall be paid by Tenant to Landlord immediately as an addition to
the Over-Allowance Amount or at Landlord's option, Tenant shall make payments
for such additional costs out of its own funds, but Tenant shall continue to
provide Landlord with the documents described in Section 2.2.2.1 (i), (ii),
(iii) and (iv) of this Tenant Work Letter, above, for Landlord's approval, prior
to Tenant paying such costs.

            4.2.2 Tenant's Agents.

                  4.2.2.1 Landlord's General Conditions for Tenant's Agents and
Tenant Improvement Work. Tenant's and Tenant's Agent's construction of the
Tenant Improvements shall comply with the following: (i) the Tenant Improvements
shall be constructed in strict accordance with the Approved Working Drawings;
(ii) Tenant's Agents shall submit schedules of all work relating to the Tenant's
Improvements to Contractor and Contractor shall, within five (5) business days
of receipt thereof, inform Tenant's Agents of any changes which are necessary
thereto, and Tenant's Agents shall adhere to such corrected schedule; and (iii)
Tenant shall abide by all rules made by Landlord's Project manager with respect
to the use of freight, loading dock and service elevators, storage of materials,
coordination of work with the contractors of other tenants, and any other matter
in connection with this Tenant Work Letter, including, without limitation, the
construction of the Tenant Improvements.

                  4.2.2.2 Indemnity. Tenant's indemnity of Landlord as set forth
in this Lease shall also apply with respect to any and all costs, losses,
damages, injuries and liabilities related in any way to any act or omission of
Tenant or Tenant's Agents, or anyone directly or indirectly employed by any of
them, or in connection with Tenant's non-payment of any amount arising out of
the Tenant Improvements and/or Tenant's disapproval of all or any portion of any
request for payment. Such indemnity by Tenant, as set forth in this Lease, shall
also apply with respect to any and all costs, losses, damages, injuries and
liabilities related in any way to Landlord's performance of any ministerial acts
reasonably necessary (i) to permit Tenant to complete the Tenant Improvements,
and (ii) to enable Tenant to obtain any Project permit or certificate of
occupancy for the Premises.

                  4.2.2.3 Requirements of Tenant's Agents. Each of Tenant's
Agents shall guarantee to Tenant and for the benefit of Landlord that the
portion of the Tenant Improvements for which it is responsible shall be free
from any defects in workmanship and materials for a period of not less than one
(1) year from the date of completion thereof. Each of Tenant's Agents shall be
responsible for the replacement or repair, without additional charge, of all
work done or furnished in accordance with its contract that shall become
defective within one (1) year after the later to occur of (i) completion of the
work performed by such contractor or

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<PAGE>

subcontractors and (ii) the Commencement Date. The correction of such work shall
include, without additional charge, all additional expenses and damages incurred
in connection with such removal or replacement of all or any part of the Tenant
Improvements, and/or the Project and/or common areas that may be damaged or
disturbed thereby. All such warranties or guarantees as to materials or
workmanship of or with respect to the Tenant Improvements shall be contained in
the Contract or subcontract and shall be written such that such guarantees or
warranties shall inure to the benefit of both Landlord and Tenant, as their
respective interests may appear, and can be directly enforced by either. Tenant
covenants to give to Landlord any assignment or other assurances which maybe
necessary to effect such right of direct enforcement.

                        4.2.2.3.1 Lien-Free Basis. Tenant's Contractor and
agents shall perform all work on a lien-free basis. If a lien is filed or
recorded against the Project due to, or in any way associated with, the
construction of the Tenant Improvements, Tenant agrees to have such lien
released of record (in a manner and form approved by Landlord) within five (5)
days of Landlord's written notice to Tenant regarding same. If Tenant fails to
cause the release of such lien within such five (5) day period to Landlord's
satisfaction, Landlord may cause the removal of such lien, and Tenant agrees to
repay Landlord for all costs and expenses incurred by Landlord to release the
lien (including, but not limited to, the payment of the amount stated in the
lien, any filing, processing, recording and attorneys' fees) within ten (10)
days of Landlord's written request therefor, and such amount shall be considered
Additional Rent due under the Lease. If Tenant fails to pay Landlord as
aforesaid, such failure shall be deemed an uncured noticed material default
under the Lease, and Landlord may pursue any remedy provided for under the
Lease, at law or in equity.

            4.2.2.4     Insurance Requirements

                  4.2.2.4.1 General Coverages. All of Tenant's Agents shall
carry worker's compensation insurance covering all of their respective
employees, and shall also carry public liability insurance, including property
damage, all with limits, in form and with companies as are required to be
carried by Tenant as set forth in this Lease.

                  4.2.2.4.2 Special Coverages. Tenant shall carry "Builder's All
Risk" insurance in an amount approved by Landlord covering the construction of
the Tenant Improvements, and such other insurance as Landlord may require, it
being understood and agreed that the Tenant Improvements shall be insured by
Tenant pursuant to this Lease immediately upon completion thereof. Such
insurance shall be in amounts and shall include such extended coverage
endorsements as may be reasonably required by Landlord including, but not
limited to, the requirement that all of Tenant's Agents shall carry excess
liability and Products and Completed Operating Coverage insurance, each in
amounts not less than $500,000 for each incident, $1,000,000 in aggregate, and
in form and with companies as are required to be carried by Tenant as set forth
in this Lease.

                  4.2.2.4.3 General Terms. Certificates for all insurance
carried pursuant to this Section 4.2.2.4 shall be delivered to Landlord before
the commencement of construction of the Tenant Improvements and before the
Contractor's equipment is moved onto the site. All such policies of insurance
must contain a provision that the company writing said policy will give Landlord
thirty (30) days prior written notice of any cancellation or lapse of the

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<PAGE>

effective date or any reduction in the amounts of such insurance. In the event
that the Tenant Improvements are damaged by any cause during the course of the
construction thereof, Tenant shall immediately repair the same at Tenant's sole
cost and expense. Tenant's Agents shall maintain all of the foregoing insurance
coverage in force until the Tenant Improvements are fully completed and accepted
by Landlord, except for any Products and Completed Operation Coverage insurance
required by Landlord, which is to be maintained for ten (10) years following
completion of the work and acceptance by Landlord and Tenant. All policies
carried under this Section 4.2.2.4 shall insure Landlord and Tenant, as their
interests may appear, as well as Contractor and Tenant's Agents. All insurance,
except Workers' Compensation, maintained by Tenant's Agents shall preclude
subrogation claims by the insurer against anyone insured thereunder. Such
insurance shall provide that it is primary insurance as respects the owner and
that any other insurance maintained by owner is excess and noncontributing with
the insurance required hereunder. The requirements for the foregoing insurance
shall not derogate from the provisions for indemnification of Landlord by Tenant
under Section 4.2.2.2 of this Tenant Work Letter.

            4.2.3 Governmental Compliance. The Tenant Improvements shall comply
in all respects with the following: (i) the Code and other state, federal, city
or quasi-governmental laws, codes, ordinances and regulations, as each may apply
according to the rulings of the controlling public official, agent or other
person; (ii) applicable standards of the American Insurance Association
(formerly, the National Board of Fire Underwriters) and the National Electrical
Code; and (iii) Project material manufacturer's specifications.

            4.2.4 Inspection by Landlord. Landlord shall have the right to
inspect the Tenant Improvements at all times, provided however, that Landlord's
failure to inspect the Tenant Improvements shall in no event constitute a waiver
of any of Landlord's rights hereunder nor shall Landlord's inspection of the
Tenant Improvements constitute Landlord's approval of the same. Should Landlord
disapprove any portion of the Tenant Improvements, Landlord shall notify Tenant
in writing of such disapproval and shall specify the items disapproved. Any
defects or deviations in, and/or disapproval by Landlord of, the Tenant
Improvements shall be rectified by Tenant at no expense to Landlord, provided
however, that in the event Landlord determines that a defect or deviation exists
or disapproves of any matter in connection with any portion of the Tenant
Improvements and such defect, deviation or matter might adversely affect the
mechanical, electrical, plumbing, heating, ventilating and air conditioning or
life-safety systems of the Project, the structure or exterior appearance of the
Project or any other tenant's use of such other tenant's leased premises,
Landlord may, take such action as Landlord deems necessary, at Tenant's expense
and without incurring any liability on Landlord's part, to correct any such
defect, deviation and/or matter, including, without limitation, causing the
cessation of performance of the construction of the Tenant Improvements until
such time as the defect, deviation and/or matter is corrected to Landlord's
satisfaction.

            4.2.5 Meetings. Commencing upon the execution of this Lease, Tenant
and Landlord shall hold meetings as required at a reasonable time, with the
Architect and the Contractor regarding the progress of the preparation of
Construction Drawings and the construction of the Tenant Improvements, which
meetings shall be held at a location designated by the partners, and Landlord
and/or its agents shall receive prior notice of, and shall have the right to
attend, all such meetings, and, upon Landlord's request, certain of Tenant's
Agents

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<PAGE>

shall attend such meetings. One such meeting each month shall include the review
of Contractor's current request for payment.

      4.3 Notice of Completion; Copy of "As Built" Plans. Within ten (10) days
after completion of construction of the Tenant Improvements, Tenant shall cause
a Notice of Completion to be recorded in the office of the Recorder of the
County of Los Angeles in accordance with Section 3093 of the Civil Code of the
State of California or any successor statute, and shall furnish a copy thereof
to Landlord upon such recordation. If Tenant fails to do so, Landlord may
execute and file the same on behalf of Tenant as Tenant's agent for such
purpose, at Tenant's sole cost and expense. At the conclusion of construction,
(i) Tenant shall cause the Architect and Contractor (A) to update the Approved
Working Drawings as necessary to reflect all changes made to the Approved
Working Drawings during the course of construction, (B) to certify to the best
of their knowledge that the "record-set" of as-built drawings are true and
correct, which certification shall survive the expiration or termination of this
Lease, and (C) to deliver to Landlord two (2) sets of copies of such as-built
drawings within ninety (90) days following issuance of a certificate of
occupancy for the Premises, and (ii) Tenant shall deliver to Landlord a copy of
all warranties, guaranties, and operating manuals and information relating to
the improvements, equipment, and systems in the Premises.

                                    SECTION 5

                                  MISCELLANEOUS

      5.1 Tenant's Representative. Tenant has designated Bill Bergovoy as its
sole representative with respect to the matters set forth in this Tenant Work
Letter, who shall have full authority and responsibility to act on behalf of the
Tenant as required in this Tenant Work Letter.

      5.2 Landlord's Representative. Landlord has designated Brooke Rege with
respect to the matters set forth in this Tenant Work Letter, who, until further
notice to Tenant, shall have full authority and responsibility to act on behalf
of the Landlord as required in this Tenant Work Letter.

      5.3 Time of the Essence in This Tenant Work Letter. Unless otherwise
indicated, all references herein to a "number of days" shall mean and refer to
calendar days. If any item requiring approval is timely disapproved by Landlord,
the procedure for preparation of the document and approval thereof shall be
repeated until the document is approved by Landlord.

      5.4 Tenant's Lease Default. Notwithstanding any provision to the contrary
contained in this Lease, if an event of default as described in the Lease or
this Tenant Work Letter has occurred at any time on or before the Substantial
Completion of the Premises, then (i) in addition to all other rights and
remedies granted to Landlord pursuant to this Lease, Landlord shall have the
right to withhold payment of all or any portion of the Tenant Improvement
Allowance and/or Landlord may cause Contractor to cease the construction of the
Premises (in which case, Tenant shall be responsible for any delay in the
substantial completion of the Premises caused by such work stoppage), and (ii)
all other obligations of Landlord under the terms of this Tenant Work Letter
shall be forgiven until such time as such default is cured pursuant to the terms
of this Lease (in which case, Tenant shall be responsible for any delay in the
substantial completion of the Premises caused by such inaction by Landlord).

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<PAGE>

      5.5 Additional Services. If the construction of the Tenant Improvements
shall require that additional services or facilities (including, but not limited
to, hoisting, cleanup or other cleaning services, trash removal, field
supervision, or ordering of materials) be provided by Landlord, then Tenant
shall pay Landlord for such items at Landlord's cost or at a reasonable charge
if the item involves time of Landlord's personnel only.

      5.6 Construction Defects. Landlord shall have no responsibility for the
Tenant Improvements and Tenant will remedy, at Tenant's own expense, and be
responsible for any and all defects in the Tenant Improvements that may appear
during or after the completion thereof whether the same shall affect the Tenant
Improvements in particular or any parts of the Premises in general. Tenant shall
indemnify, hold harmless and reimburse Landlord for any costs or expenses
incurred by Landlord by reason of any defect in any portion of the Tenant
Improvements constructed by Tenant or Tenant's contractor or subcontractors, or
by reason of inadequate cleanup following completion of the Tenant Improvements.

      5.7 Coordination of Labor. All of Tenant's contractors, subcontractors,
employees, servants and agents must work in harmony with and shall not interfere
with any labor employed by Landlord, or Landlord's contractors or by any other
tenant or its contractors with respect to any portion of the Project.

      5.8 Work in Adjacent Areas. Any work to be performed in areas adjacent to
the Premises shall be performed only after obtaining Landlord's express written
permission, which shall not be unreasonably withheld, conditioned or delayed,
and shall be done only if an agent or employee of Landlord is present; Tenant
will reimburse Landlord for the expense of any such employee or agent.

      5.9 HVAC Systems. Tenant agrees to be entirely responsible for the
maintenance or the balancing of any heating, ventilating or air conditioning
system installed by Tenant and/or maintenance of the electrical or plumbing work
installed by Tenant and/or for maintenance of lighting fixtures, partitions,
doors, hardware or any other installations made by Tenant.

      5.10 Approval of Plans. Landlord will not check Tenant drawings for
building code compliance. Approval of the Construction Drawings by Landlord is
not a representation that the drawings are in compliance with the requirements
of governing authorities, and it shall be Tenant's responsibility to meet and
comply with all federal, state, and local code requirements. Approval of the
Construction Drawings does not constitute assumption of responsibility by
Landlord or its architect for their accuracy, sufficiency or efficiency, and
Tenant shall be solely responsible for such matters.

      5.11 Books and Records. At its option, Landlord, at any time within two
(2) years after final disbursement of the Tenant Improvement Allowance to
Tenant, and upon at least ten (10) days prior written notice to Tenant, may
cause an audit to be made of Tenant's books and records relating to Tenant's
expenditures in connection with the construction of the Tenant Improvements.
Tenant shall maintain complete and accurate books and records in accordance with
generally accepted accounting principles of these expenditures for at least two
(2) years. Tenant shall make available to Landlord's auditor at the Premises
within ten (10) business days following Landlord's notice requiring the audit,
all books and records maintained by Tenant

                                       57
<PAGE>

pertaining to the construction and completion of the Tenant Improvements. In
addition to all other remedies which Landlord may have pursuant to the Lease,
Landlord may recover from Tenant the reasonable cost of its audit if the audit
discloses that Tenant falsely reported to Landlord expenditures which were not
in fact made or falsely reported a material amount of any expenditure or the
aggregate expenditures.

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<PAGE>

                               EXHIBIT D TO LEASE

                     FORM OF MEMORANDUM OF COMMENCEMENT DATE

_________________, as Landlord, and _______________________________as Tenant,
executed that certain Lease dated as of ________________________, 2000 (the
"Lease").

The Lease contemplates that upon satisfaction of certain conditions Landlord and
Tenant will agree and stipulate as to certain provisions of the Lease. All such
conditions precedent to that stipulation have been satisfied.

Landlord and Tenant agree as follows:

1.  The Commencement Date of the Lease is ______________________________.

2.  The Termination Date of the Lease is ___________________________________.

3.  The Premises consist of ____________________________ rentable square feet.

4.  Base Rent is as follows:
____________________ THROUGH _________________; $__________ PER MONTH
____________________ THROUGH _________________; $__________ PER MONTH
____________________ THROUGH _________________; $__________ PER MONTH
____________________ THROUGH _________________; $__________ PER MONTH

5.  Tenant's Pro Rata Share is ________________ percent (_________%).

IN WITNESS WHEREOF, the parties have caused this Memorandum to be duly executed
as of ______________, 2000.

LANDLORD:                               TENANT:
---------                               -------

BY:                                     BY:
NAME:                                   NAME:
ITS:                                    ITS:

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<PAGE>

                               EXHIBIT E TO LEASE

                              RULES AND REGULATIONS

1. No sign, placard, picture, advertisement, name or notice shall be installed
or displayed on any part of the outside or inside of the Building or Land
without the prior written consent of the Landlord. 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. If Landlord objects in writing to any curtains, blinds, shades, screens or
hanging plants or other similar objects attached to or used in connection with
any window or door of the Premises, Tenant shall immediately discontinue such
use. 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.

3. Tenant shall not obstruct any sidewalk, halls, passages, exits, entrances,
elevators, escalators, or stairways of the Building. The halls, passages, exits,
entrances, elevators, escalators and stairways are not open to the general
public. Landlord shall in all cases retain the right to control and prevent
access to such areas of all persons whose presence in the judgment of Landlord
would be prejudicial to the safety, character, reputation and interest of the
Land, Building and the Project's tenants; provided that, nothing in this Lease
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. Tenant shall not go upon the roof of
the Building.

4. The directory of the Building will be provided exclusively for the display of
the name and location of tenants only, and Landlord reserves the right to
exclude any other names therefrom.

5. All cleaning and janitorial services for the Premises shall be provided
exclusively by Tenant, at Tenant's sole cost. 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 person.

6. Landlord will furnish Tenant, free of charge, two (2) keys to each door lock
in the Premises. Landlord may make a reasonable charge for any additional keys.
Tenant shall not make or have made additional keys, and 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
of all doors which have been furnished to Tenant, and in the event of loss of
any keys so furnished, shall pay Landlord therefor.

7. If Tenant requires telegraphic, telephonic, computer circuits, burglar alarm
or similar services, it shall first obtain, and comply with, Landlord's
instructions for their installation, and shall pay the entire cost of such
installation(s).

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 Governmental

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<PAGE>

Requirements. Landlord shall have the right to prescribe the weight, size and
position of all equipment, materials, furniture or other property brought into
the Building. 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 to any space in the Building or to any other tenant 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 (except the gross
negligence or willful misconduct of Landlord), 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
permitted by the Lease. 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 Project by reason of noise, odors or vibrations nor shall
Tenant bring into or keep in or about the Premises any birds or animals, except
seeing eye-dogs for the blind.

10. Tenant agrees to cooperate fully to assure the most effective operation of
the heating and air-conditioning and to comply with any governmental
energy-saving rules, laws or regulations of which Tenant has actual notice.

11. Landlord reserves the right to change the name and street address of the
Building and/or Project.

12. Landlord reserves the right to exclude from the Building and/or Project
between the hours of 6 p.m. and 7 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
and/or Project of any person. Landlord reserves the right to prevent access to
the Building in case of invasion, mob, riot, public excitement or other
commotion by closing the doors or by other appropriate action.

13. Tenant shall close and lock the doors of its 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 and/or Project or by Landlord for noncompliance with this rule.

14. Tenant shall not obtain for use on the Premises ice, drinking water, food,
beverage, towel or other similar services, except at such hours and under such
regulations as may be fixed by Landlord.

                                       61
<PAGE>

15. 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 deposited in them. The
expenses of any breakage, stoppage or damage resulting from the violation of
this rule shall be borne by Tenant if it or its employees or invitees shall have
caused it.

16. 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 or Project. Tenant
shall not use the Premises for any business or activity other than that
specifically provided for in the Lease.

17. Tenant shall not install any radio or television antenna, loudspeaker or
other device on the roof or exterior walls of the Building. Tenant shall not
interfere with radio or television broadcasting or reception from or in the
Building or elsewhere.

18. Tenant shall not mark, drive nails, screws or drill into the partitions,
woodwork or plaster or in any way deface the Premises. 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 approved by Landlord. Tenant shall repair any damage
resulting from noncompliance with this rule.

19. Tenant shall not install, maintain or operate upon the Premises any vending
machine without the written consent of Landlord.

20. Canvassing, soliciting and distribution of handbills or any other written
material, and peddling in the Project or Land are prohibited, and Tenant shall
cooperate to prevent the same.

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

22. Tenant shall store all of 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.

23. The Premises shall not be used for lodging or any improper or immoral or
objectionable purpose. No cooking shall be done or permitted by Tenant, except
that use by Tenant of Underwriters' Laboratory approved equipment for microwave
cooking, brewing coffee, tea, hot chocolate and similar beverages shall be
permitted; provided that, such equipment and its use is in accordance with all
Governmental Requirements.

24. Tenant shall not use in the Premises or in the public halls of the Building
or Project any hand truck except those equipped with rubber tires and side
guards or such other material-

                                       62
<PAGE>

handling equipment as Landlord may approve. Tenant shall not bring any other
vehicles of any kind into the Building.

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

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

27. Tenant assumes any and all responsibility for protecting the Premises from
theft, robbery and pilferage, which includes keeping doors locked and other
means of entry to the Premises closed.

28. The requirements of Tenant will be attended to only upon appropriate
application to the Manager of the Building by an authorized individual.
Employees of Landlord are not required to perform any work or do anything
outside of their regular duties unless under special instructions from Landlord,
and no employee of Landlord is required to admit Tenant to any space other than
the Premises without specific instructions from Landlord.

29. Tenant shall not park its vehicles in any parking areas designated by
Landlord as areas for parking by visitors to the Building or Project or Land.
Tenant shall not leave vehicles in the parking areas overnight nor park any
vehicles in the Building or Project parking areas other than automobiles,
motorcycles, motor driven or nonmotor driven bicycles or four-wheeled trucks.

30. Landlord shall enforce the Rules and Regulations in a non-discriminatory
manner throughout the Project. 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 any other person, nor prevent Landlord from thereafter revoking such
waiver and enforcing any such Rules and Regulations against any or all of the
tenants of the Project.

31. 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 covenants and conditions
of any lease of premises in the Project. If any provision of these Rules and
Regulations conflicts with any provision of the Lease, the terms of the Lease
shall prevail.

32. 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, the care and cleanliness of the Building, Project and Land and the
preservation of good order in the Building and Project. Tenant agrees to abide
by all the Rules and Regulations stated in this exhibit and any additional rules
and regulations which are so made by Landlord.

33. Tenant shall be responsible for the observance of all of the foregoing rules
by Tenant and Tenant's Agents.

                                       63

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