Document:

<PAGE>

                                                                 EXHIBIT 10 (xi)

                   NON-QUALIFIED STOCK OPTION AWARD AGREEMENT
                  PURSUANT TO THE CAMCO FINANCIAL CORPORATION
                           2002 EQUITY INCENTIVE PLAN

      THIS AGREEMENT is made to be effective as of the Grant Date set forth
below by and between Camco Financial Corporation (the "Company") and the
Participant set forth below, pursuant to the Camco Financial Corporation 2002
Equity Incentive Plan (the "Plan").

      In consideration of the mutual promises and agreements contained herein,
the parties hereto make the following agreement, intending to be legally bound
thereby:

      1.    Grant of Option. The following terms used in this Agreement shall
have the meanings set forth below:

            (A)   The "Participant" is ________________________.

            (B)   The "Grant Date" is ___________________, 200_.

            (C)   The "Covered Shares" are ___________ shares of common stock of
                  the Company.

            (D)   The "Exercise Price Per Share" is $____________.

            (E)   The "Expiration Date" is ________________, 20__, subject to
                  earlier termination as set forth in Section 2(C) of this
                  Agreement.

Other terms used in this Agreement are defined elsewhere in this Agreement or
have the meaning ascribed to them under the Plan.

      2.    Terms and Conditions of the Option.

            (A)   Option Grant. The Company hereby grants to the Participant an
option to purchase the Covered Shares at the Exercise Price and subject to the
terms and conditions set forth in this Agreement and in the Plan.

            (B)   Exercise of the Option. The Option is exercisable in
accordance with the following schedule:

<TABLE>
<CAPTION>
   DATE EXERCISABLE               NUMBER OF SHARES
-----------------------           ----------------
<S>                               <C>
_________________, 200_            ______________
_________________, 200_            ______________
_________________, 200_            ______________
_________________, 200_            ______________
_________________, 200_            ______________
</TABLE>

<PAGE>

The vesting of the Option may be accelerated in accordance with Article VIII of
the Plan.

            The Option may be exercised by giving written notice of exercise to
the Company addressed to the President or the Chief Financial Officer of the
Company stating the number of shares as to which the Option is being exercised.
Such notice shall be accompanied by payment in full of the Exercise Price Per
Share for the number of covered shares as to which option is being exercised (i)
in cash or by certified or cashier's check, (ii) by delivering to the Company
shares of common stock of the Company already owned by the Participant and
acceptable to the Committee which have an aggregate Fair Market Value equal to
the Exercise Price Per Share for the number of Covered Shares as to which the
Option is being exercised, or (iii) by another method approved by the Committee.

            The Option may be exercised to purchase a number of whole shares
which is less than the total number of shares of common stock subject to the
Option at any time and from time to time.

            The Option may not be exercised unless the covered shares are first
registered pursuant to any applicable federal or state laws or regulations or,
in the opinion of counsel to the Company, are exempt from such registration.
Nothing contained in the Plan or in this Agreement shall be construed to require
the Company to take any action whatsoever to make exercisable any Option or to
make transferable any shares issued upon the exercise of any Option.

            (C)   Termination of Option. The Option shall expire on the
Expiration Date, unless the Participant's employment terminates prior to the
Expiration Date, in which event, the Option shall Expire as follows:

                  (1)   Upon Termination for Cause (hereinafter defined), the
Option shall expire on the date of such termination;

                  (2)   Upon the death of the Participant, the Option shall
expire one year from the date of the Participant's death;

                  (3)   In the event of Disability (as defined in the Plan), the
Option shall expire one year from the date of termination of employment due to
Disability;

                  (4)   Upon Retirement (as defined in the Plan), the Option
shall expire one year after the Participant's Retirement date;

                  (5)   In the event of Voluntary Termination (as defined in the
Plan), the Option shall expire six months after the Participant's termination
date; or

                  (6)   In the event of Involuntary Termination (as defined in
the Plan), then Option shall expire three months after the Participant's
termination date.

                                      -2-

<PAGE>

The Committee's determination whether a Participant's employment has terminated,
the reason therefor and the effective date thereof, shall be final and
conclusive on all persons affected thereby.

            For purposes of this Agreement, Termination for Cause means
discharge of a Participant for personal dishonesty, incompetence, willful
misconduct, breach of fiduciary duty involving personal profit, intentional
failure to perform assigned duties and responsibilities, willful violation of
any law, rule, regulation or final cease and desist order (other than traffic
violations or similar offenses), conviction of a felony or for fraud or
embezzlement, or material breach of any provision of any written employment
agreement between the Participant and the Company.

            (D)   Withholding. All deliveries and distributions under this
Agreement are subject to withholding of all applicable taxes. In the discretion
of the Committee, such withholding obligations may be satisfied through the
surrender of shares of common stock, of the Company already owned by the
Participant or to which the Participant is entitled as a result of the exercise
of the Option.

      3.    Non-Assignability of the Option. The Option shall not be assignable
or transferable by the Participant except by will or the laws of descent and
distribution, and the terms and conditions of the Option shall be binding upon
the executors, administrators, heirs, successors and assigns of the Participant.

      4.    Governing Law. The rights and obligations of the Participant and the
Company under this Agreement shall be governed by and construed in accordance
with the laws of the State of Ohio in all respects, including, without
limitation, matters relating to the validity, construction, interpretation,
administration, effect, enforcement, and remedies provisions of the Plan and its
rules and regulations, except to the extent preempted by applicable federal law.
The Participant and the Company agree to submit to the jurisdiction of the state
and federal courts of the State of Ohio with respect to matters relating to the
Plan and this Agreement and agree not to raise or assert the defense that such
forum is not convenient.

      5.    Rights and Remedies Cumulative. All rights and remedies of the
Company and of the Participant enumerated in this Agreement shall be cumulative
and, except as expressly provided otherwise in this Agreement, none shall
exclude any other rights or remedies allowed by law or in equity, and each of
said rights or remedies may be exercised and enforced concurrently.

      6.    Captions. The captions contained in this Agreement are included only
for convenience of reference and do not define, limit, explain or modify this
Agreement or its interpretation, construction or meaning and are in no way to be
construed as a part of this Agreement.

      7.    Severability. If any provision of this Agreement or the application
of any provision hereof to any person or any circumstance shall be determined to
be invalid or

                                      -3-

<PAGE>

unenforceable, then such determination shall not affect any other
provision of this Agreement or the application of such provision to any other
person or circumstance, all of which other provisions shall remain in full force
and effect. It is the intention of each party to this Agreement that if any
provision of this Agreement is susceptible of two or more constructions, one of
which would render the provision enforceable and the other or others of which
would render the provision unenforceable, then the provision shall have the
meaning which renders it enforceable.

      8.    Plan as Controlling. All terms and conditions of the Plan applicable
to options granted thereunder which are not set forth in this Agreement shall be
deemed incorporated herein by reference. In the event that any provision in this
Agreement conflicts with any term in the Plan, the term in the Plan shall be
deemed controlling. Capitalized terms not defined in this Agreement shall have
the meaning ascribed to them in the Plan.

      9.    No Right to Continued Employment. This Plan does not constitute a
contract of employment. Nothing in the Plan or in this Agreement confers upon
the Participant the right to continue in the employ of the Company or interferes
with or restricts in any way the right of the Company to discharge the
Participant at any time (subject to any contract rights of such Participant).

      10.   Stockholders' Rights. The Participant shall have none of the rights
or privileges of a stockholder of the Company, including but not limited to the
right to receive dividends on the Covered Shares, except with respect to shares
as to which a stock certificate has been duly issued to the Participant.

      11.   Entire Agreement. This Agreement constitutes the entire agreement
between the Company and the Participant with respect to the subject matter of
this Agreement, and this Agreement supersedes all prior and contemporaneous
agreements between the parties hereto in connection with the subject matter of
this Agreement. No change, termination or attempted waiver of any of the
provisions of this Agreement shall be binding upon any party hereto unless
contained in a writing signed by the party to be charged.

      IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of __________________ __, 200_.

COMPANY:                                     PARTICIPANT:

Camco Financial Corporation

By: ________________________________         __________________________________
    ___________________________              [Print name] _____________________
    Its: ______________________

                                      -4-<PAGE>

                                                                   EXHIBIT 10.14

                            GOVERNMENT OF PUERTO RICO
                   PUERTO RICO INDUSTRIAL DEVELOPMENT COMPANY
                            P.O. BOX 362350 SAN JUAN,
                             PUERTO RICO 00936-2350

                          LEASE AGREEMENT (BASIC PLANT)

                                     BETWEEN

                   PUERTO RICO INDUSTRIAL DEVELOPMENT COMPANY

                                   AS LANDLORD

                                       AND

                            LIFESTYLE FOOTWEAR, INC.

                                    AS TENANT

PROJECT NO.: T-1236-0-87
LOCATION: MOCA, PUERTO RICO
<PAGE>

                                      INDEX

ARTICLE

Article I.  Basic: Terms of Lease

1.01     Landlord .

1.02     (a)      Landlord's Postal Address

         (b)      Landlord's Physical Address

1.03     (a)      Tenant

         (b)      Tenant's Trade Name

1.04     (a)      Tenant's Postal Address

         (b)      Tenant's Physical Address

1.05     Tenant's Employer Identification Number

1.06     Leased Premises

         Additional Parcel

1.07     Permitted Use

1.08     Capitalization, Investment and Employment Levels

1.09     Lease Term

1.10     Definition of "Year"

1.11     Date of Delivery of Possession

1.12     Rent Commencement Date

1.13     Basic Rent

1.14     Security Deposit

1.15     Guarantor

1.16     Effect of Recurrence to Defined Term in Article I

1.17     Attachments

ARTICLE II. TITLE, AUTHORITY AND DEMISE

2.01     Title and Authority

2.02     Demise

ARTICLE III.  LEASE TERM; POSSESSION

3.01     Term

3.02     Delivery of Possession of Leased Premises

ARTICLE IV.  USE OF LEASED PREMISES, RESTRICTIONS AND OPERATIONAL REQUIREMENTS

4.01     Use of Leased Premises

         (a)      Authorized Use

         (b)      Restrictions

4.02     Ongoing Operation; Levels of Capitalization, Investment and Employment

         (a)      Purpose

         (b)      Interruption of Operations

                                       i
<PAGE>

         (c)      Level of Capitalization, Investment and Employment

ARTICLE V.  RENT

5.01     Basic Rent

5.02     Additional Rent

5.03     Payment Method

ARTICLE VI.  SECURITY DEPOSIT

6.01     Security Deposit

6.02     Use of Security Deposit

6.03     Surrender of Security Deposit

6.04     Transfer of Security Deposit

ARTICLE VII.  ALTERATIONS AND IMPROVEMENTS

7.01     General Provisions

7.02     Alterations and Improvements

7.03     Air Conditioning; Electric Power Generator

7.04     Sprinkler System

7.05     Floor Load

7.06     Liens and Encumbrances

7.07     Ownership of Improvements; Surrender

7.08     Plans and Specifications

ARTICLE VIII.  MAINTENANCE AND REPAIRS

8.01     Tenant's Duties and Responsibilities

8.02     Landlord's Duties and Responsibilities

8.03     Roof Care and Maintenance

ARTICLE IX.  PUBLIC UTILITIES

9.01     Tenant's Duties and Responsibilities

9.02     Service Interruption

9.03     Electricity

         (a)      Electric Power

         (b)      Electrical Substation

         (c)      Additional Equipment

9.04     Water Supply

ARTICLE X. QUIET ENJOYMENT

10.01    Quiet Enjoyment

                                       ii
<PAGE>

ARTICLE XI.  TAXES, ASSESSMENTS AND DUTIES

11.01    Taxes, Assessments and Duties

ARTICLE XII.  ENVIRONMENTAL

12.01    Governmental Regulations and Environmental Protection

ARTICLE XIII.  DESTRUCTION OF PREMISES

13.01    Notice of Event

13.02    Landlord's Duty to Repair

13.03    Lease Agreement Termination

13.04    Restoration

13.05    Rent Adjustment

13.06    Damage Report

ARTICLE XIV.  WAIVER OF CLAIMS; INDEMNIFICATION

14.01    Indemnification

14.02    Waiver of Claims

14.03    Tenant Responsible for Personal Property

ARTICLE XV.  INSURANCE

15.01    Insurance

15.02    Insurance During Construction

15.03    Insurance Policy Increase

15.04    General Requirements

15.05    Insurance Certificates

15.06    Evidence of Payment; Renewal of Policies

15.07    Claims

15.08    Periodic Reviews

15.09    Penalties

15.10    Waiver of Subrogation

ARTICLE XVI.  LANDLORD'S RIGHTS

16.01    Access to Leased Premises

ARTICLE XVII.  TENANT BANKRUPTCY

17.01    Lease Agreement Assumption Requirements

                                      iii
<PAGE>

ARTICLE XVII.  TERMINATION BY BREACH

18.01    Breach by Tenant as Cause for Termination

18.02    Other Causes for Termination

18.03    Abandonment

18.04    Termination by Tenant

18.05    Landlord's Options

18.06    Damages

18.07    Right to Relet

ARTICLE XIX.  RETURN OF LEASED PREMISES

19.01    Surrender of Possession

19.02    Holding Over

19.03    Inspection of Leased Premises

19.04    Equipment, Machinery and other Furniture Not Removed

19.05    Tenant's Liabilities

ARTICLE XX.  LEGAL REQUIREMENTS

20.01    Legal and Insurance Compliance

ARTICLE XXI.  ASSIGNMENT AND SUBLEASE

21.01    Assignment and Sublease

21.02    Change of Control

21.03    Permitted Assignments and Subleases

ARTICLE XXII.  GENERAL PROVISIONS

22.01    Signs and Advertising

22.02    Parking

22.03    Attorneys' Fees

22.04    Successors and Assignees

22.05    Landlord's Obligation to Lease

22.06    Definition of the Term "Tenant"

22.07    Headings

22.08    Late Charges

22.09    Lease Guaranty

22.10    Performance

22.11    Entire Agreement

22.12    Force Majeure

22.13    Safety Programs

22.14    Estoppel Certificate

22.15    Tenant's Duties; Landlord's Rights

22.16    Relationship Between the Parties

                                       iv
<PAGE>

22.17    Nullity or Partial Invalidity

22.18    Accord and Satisfaction

22.19    Applicable Law

22.20    Jurisdiction and Competency

22.21    Net Lease

22.22    Notices

22.23    Non-Waiver

22.24    Cumulative Remedies

22.25    Brokers

22.26    Cross Default

22.27    Representations

22.28    Financial Statements

22.29    Additional Documents

22.30    Fiscal Liabilities

22.31    Debt Certification

22.32    No-Conflict Certification

                                       v
<PAGE>

                                    ARTICLE I

                              BASIC TERMS OF LEASE

      The following sections set forth basic information referred to in this
Lease Agreement and, where appropriate. constitute definitions of the terms
hereinafter listed.

1.01  LANDLORD:  Puerto Rico Industrial Development Company (PRIDCO).

1.02  (a)        LANDLORD'S POSTAL ADDRESS:         P.O. Box 362350
                                                    San Juan, P.R. 00936-2350
                                                    Attn.: Real Estate Office

      (b)        LANDLORD'S PHYSICAL ADDRESS:       355 F.D. Roosevelt Avenue
                                                    Hato Rey, Puerto Rico 00918
                                                    Telephone: (787) 758-4747
                                                    Fax: (787)764-3791

1.03  (a)        TENANT: LIFESTYLE FOOTWEAR, INC.

      (b)        TENANT'S TRADE NAME: LIFESTYLE FOOTWEAR, INC.

1.04  (a)        TENANT'S POSTAL ADDRESS: P.O. BOX 448, RAMEY, PUERTO RICO
                 00604, Phone: (787) 882-3900.

      (b)        TENANT'S HEADQUARTERS ADDRESS: ROCKY SHOES & BOOTS
                 194, Harder St., Nelsonville, Ohio.

1.05  TENANT'S EMPLOYER IDENTIFICATION NO. 66-0448782

1.06  LEASED PREMISES: Project No. T-1236-0-87; as described in Attachment A to
      this Lease Agreement, consisting of a parcel of land and a building
      thereon having a gross construction area of 44.977.75 sq. ft. (the
      "Building'") located in Moca, Puerto Rico. The Leased Premises include the
      special facilities, if any, described in Attachment A. For purposes of
      this Lease Agreement, the Building's gross construction area includes,
      without limitation, bathrooms, ramps, access stairs, loading docks,
      exterior shelters, corridors between buildings or structures and other
      roofed structures on the parcel of land, as described in Attachment A.

1.07  PERMITTED USE: The Leased Premises shall be used exclusively for: the
      manufacture of leather footwear and boots. SIC Number: 03143

1.08  CAPITALIZATION, INVESTMENT AND EMPLOYMENT LEVELS: The maximum level of
      Capitalization, Investment and number of Employees that Tenant is required
      to

<PAGE>

      have for its operations at the Leased Premises, u defined in Section
      4.02(e) of this Lease Agreement. Tenant will be required to maintain the
      following levels:

<TABLE>
<S>                                   <C>
(a)   Capital                         $3,500.000.00
(b)   Machinery and Equipment         $  958,000.00
(c)   Employees                                  97
</TABLE>

      As used in this Lease Agreement, the term "capitalization" includes the
      stream of total value ("equity") of the owner (preferred stock, common
      stock and surplus) plus long-term debt Amortization of the long-term debt
      will not reduce the amount originally established as the minimum
      capitalization amount.

1.09  LEASE TERM: Ten (10) Years beginning on the Date of Delivery of Possession
      (the "Initial Term'"), plus one (1) additional renewal period of Ten (10)
      Years each. Renewals shall take effect automatically upon the expiration
      of the them in force, unless one of the parties hereto, no later than one
      hundred eighty (180) days before the expiration of such term, notifies the
      other party of its intention to terminate the lease upon conclusion of the
      term then in force.

1.10  YEAR: "Year" shall mean 365 consecutive days unless the year in question
      is a leap year, in such case the term "Year" shall mean 366 consecutive
      days.

1.11  DATE OF DELIVERY OF POSSESSION: The date Landlord delivers the keys to the
      Leased Premises to the Tenant, which date shall be acknowledged by the
      parties by way ora Certificate of Delivery of Keys (as defined in Section
      3.02, see Attachment F).

1.12  RENT COMMENCEMENT DATE: The date on which Tenant's obligation to pay Basic
      Rent commences. Tenant's obligation to pay Basic Rent hereunder shall
      commence on the Date of Delivery of Possession.

1.13  BASIC RENT: The Basic Rent to be paid to Landlord shall be based on the
      gross construction area of the Building as ,follows:

<TABLE>
<CAPTION>
YEAR         RENT PER SO. FT.   ANNUAL BASIC RENT   MONTHLY BASIC RENT
-------      ----------------   -----------------   ------------------
<S>          <C>                <C>                 <C>
1 to 5           $2.20             $ 98.951.05          $ 8.245.92
6 to 10          $2.75             $123.688.81          $10.307.40
</TABLE>

Renewal      The Basic Rent for a renewal period shall be the prevailing lease
             rate charged by Landlord at the time of the renewal for similar
             properties in the zone in which the Leased Premises arc located.

Tenant's obligation to pay Basic Rent shall commence on the date set forth in
Section 1.12 of this Lease Agreement.

                                       2
<PAGE>

1.14  SECURITY DEPOSIT: A sum equivalent to the aggregate of (i) the payment(s),
      below identified as "Reservation Payment", made by Tenant prior to the
      execution of this Lease Agreement to reserve the Leased Premises and (ii)
      the amount below identified as the "Security Deposit Balance", which
      amount is the remaining balance to complete the security deposit required
      under Section 6.01 of this Lease Agreement.

      Total Security Deposit $11,874.13

      The Security Deposit Balance payment shall be made with a manager's or
      official bank check and delivered by Tenant together with this Lease
      Agreement.

1.15  GUARANTOR: N/A

1.16  EFFECT OF REFERENCE TO A DEFINED TERM IN ARTICLE I. Each of the defined
      terms used in Article I shall be construed in conjunction with the
      definition thereof contained in this Lease Agreement. In the event of any
      conflict between the defined term and the balance of the Lease Agreement,
      the latter shall prevail.

1.17  ATTACHMENTS. The following marked attachments are incorporated in this
      Lease Agreement by reference as if set forth at length herein and form an
      integral part hereof:

[X]   Attachment A - Description of Leased Premises and premises's deficiencies

[ ]   Attachment B - Lease of Additional Parcel

[ ]   Attachment C - Certificate of Delivery of Leased Parcel (Form BRN"()23A)

[ ]   Attachment D - Work to be Performed by Tenant

[ ]   Attachment E - Notice of Delivery of Possession

[X]   Attachment F - Certificate of Delivery of Keys (Form - BRN-033)

                                   ARTICLE II

                           TITLE, AUTHORITY AND DEMISE

2.01  Title and Authority. Landlord is the owner of the property descried in
      Attachment A hereto and, in such capacity, has full right and lawful
      authority to lease said property to Tenant and to grant to Tenant all the
      rights pertaining thereto, subject to the liens, encumbrances and
      restrictions which may affect it, if any, and the terms and conditions of
      this Lease Agreement and of its attachments.

2.02  Demise. Subject to the terms, covenants and conditions of this Lease
      Agreement, Landlord leases the property described in Attachment A (the
      "Leased Premises" to Tenant, and Tenant accepts same.

                                       3
<PAGE>

                                   ARTICLE III

                            LEASE TERM AND POSSESSION

3.01  Term. The term of this Lease Agreement (hereinafter the "Term" shall
      commence on the Date of Delivery of Possession (as defined in Section
      1.11) and shall expire on the last day of the last Year of the term
      (including any possible extension as per Section 1.09), unless earlier
      terminated in accordance with the provisions of Article XVIII hereof.

3.02  Delivery of Possession of Leased Premises. The exact date on which the
      Leased Premises shall be delivered to Tenant shall either be set forth in
      Section 1.11 of this Lease Agreement or attested to in writing by Landlord
      and Tenant in a document in form substantially similar to Attachment F of
      this Lease Agreement (the "Certificate of Delivery of Keys").

                                   ARTICLE IV

                    USE OF THE LEASED PREMISES, RESTRICTIONS
                          AND OPERATIONAL REQUIREMENTS

4.01  Use of Leased Premises. (a) Authorized Use. Tenant shall use and occupy
      the Leased Premises solely and exclusively as authorized in Section 01.07
      of this Lease Agreement. Any change in the authorized use must be
      previously approved in writing by Landlord.

      (b)   Restrictions. Landlord reserves exclusively to itself the air rights
            over any building or structure forming part of Leased Premises, for
            any purpose.

4.02  Ongoing Operation: Levels of Capitalization. Investment and Employment.

      (a)   Tenant acknowledges that this Lease Agreement is entered into in
            furtherance of the Government of Puerto Rico's economic and
            industrial development plan. Accordingly, strict compliance with the
            provisions of this Section 4.02 is a paramount and indispensable
            requirement of this Lease Agreement.

      (b)   Interruption of Operations. In accordance with the previous
            paragraph, Tenant shall make every effort necessary to maintain
            uninterrupted its operations at the Leased Premises. However,
            nothing contained in this section shall be deemed to require Tenant
            to conduct its operations in any other way than in compliance with
            sound business principles. The temporary shutdown or interruption of
            operations for reasonable cause shall not constitute a breach of
            this Lease Agreement if Tenant has satisfied the following
            conditions:

            (i)   Tenant shall notify Landlord in writing of any interruption or
                  temporary shutdown of operations at least thirty (30) days
                  prior to the scheduled occurrence thereof, except in the event
                  of an emergency interruption or

                                       4
<PAGE>

                  shut down, in which case notice shall be given as quickly as
                  possible but not later than the next business day;

            (ii)  the interruption or temporary shutdown of operations shall not
                  last for more than three (3) consecutive months; and

            (iii) during the period of interruption or temporary shutdown of
                  operations, Tenant shall observe and comply with all the
                  terms, conditions and obligations of this Lease Agreement,
                  including. but not limited to, the payment of Rent (Basic and
                  Additional) and the maintenance of the Leased Premises.

      (c)   Levels of Capitalization. Investment and Employment. Tenant pledges
            to have on the Date of Delivery of Possession, and maintain during
            the Term, a minimum level of capitalization equivalent to the sum
            indicated in item (a) of Section 1.08, which sum shall be verified
            by audited financial statements at the end of every calendar year.
            In the same manner and in a period of six (6) months after the Date
            of Delivery of Possession, Tenant pledges to install manufacturing
            equipment and machinery (either owned or leased) in the Leased
            Premises, whose value shall represent an investment of no less than
            the sum indicated in item (b) of Section 1.08 (this value shall not
            include the cost of transportation and installation of the equipment
            and/or machinery, nor its ordinary depreciation after installation).
            Eighteen (18) months after the Date of Delivery of Possession,
            Tenant shall have in its employment at least the number of persons
            indicated in item (c) of Section 1.08 to accomplish the operation of
            its business at the Leased Premises. Tenant shall maintain the
            minimum required levels of capitalization, investment and employment
            set forth in Section 1.08 during the Term of this Lease Agreement
            including any extensions thereof.

                                    ARTICLE V

                                      RENT

5.01  Basic Rent. As of the Rent Commencement Date set forth in Section 1.12
      hereof; Tenant shall pay to Landlord the Basic Rent specified in Section
      1.13 of this Lease Agreement. The Basic Rent for any renewal period shall
      be the prevailing lease rate charged by Landlord at the time of the
      renewal period for similar properties in the zone in which the Leased
      Premises arc located; provided, however, that the Basic Rent for a renewal
      period shall not be less than that of the preceding lease period. Tenant
      shall pay the Basic Rent in monthly installments in the amount indicated
      in Section 1.13 in advance on or before the first day of each calendar
      month (the "Monthly Rent"); provided, however, that if the Rent
      Commencement Date does not fall on the first day of a calendar. month. the
      rent for the initial partial month shall be prorated based on a 30 day
      month and included with the first payment of Monthly Rent due the first
      day of the first full calendar month following the Rent Commencement Date.

                                       5
<PAGE>

5.02  Additional Rent. Any amount Tenant is obligated to payor reimburse
      Landlord under this Lease Agreement that is not Basic Rent shall be
      considered to be Additional Rent.

5.03  Payment Method. The Basic Rent and the Additional Rent (hereinafter
      collectively, the "Rent") shall be paid in legal currency of the United
      States of America. Any payment or charge identified in this Lease
      Agreement as Additional Rent shall be made on or before the first day of
      the month following the date the request for payment was sent by Landlord
      to Tenant. All Rent shall be remitted to Landlord, delivered either
      personally or by mail to the address indicated in Section 1.02 of this
      Lease Agreement, or to any other address that Landlord may from tin)e to
      time notify to Tenant, it being Tenant's duty to take the necessary
      measures and precautions to ensure that the Rent is received by Landlord
      on or before its due date. The payment of Rent is separate from any other
      agreement or obligation contained in this Lease Agreement, and shall be
      paid without the need of previous request or notice by Landlord. without
      set off. adjustment or abatement of any kind, except as otherwise provided
      for herein. Landlord may demand at any time that Rent payments be made by
      a Manager's or official bank check.

                                   ARTICLE VI

                                SECURITY DEPOSIT

6.01  Security Deposit. Simultaneously with the execution of this Lease
      Agreement, Tenant shall deliver to Landlord a manager's or official bank
      check, for the amount specified in Section 1.14 of this Lease Agreement
      (the "Security Deposit"), to guarantee the faithful performance of each
      and every one of Tenant's obligations, including, but not limited to, the
      payment of all the Basic Rent, any other expenditure Tenant is responsible
      for hereunder, and the surrender of the Leased Premises upon expiration of
      the Term, or at the termination of this Lease Agreement, in the condition
      and good order required by Article XIX of this Lease Agreement. Tenant
      shall not have the right to receive interest on the Security Deposit.

6.02  Use of Security Deposit. Landlord may use all or part of the Security
      Deposit at any time to cover any payment (including Rent) or expense that,
      according to the terms and conditions of this Lease Agreement, is Tenant's
      responsibility. Should it become necessary for Landlord to use the
      Security Deposit as a result of a default or violation of the Lease
      Agreement by Tenant, Tenant must replace the amount used by Landlord
      within fifteen (15) days of a written demand therefor by Landlord.

6.03  Surrender of Security Deposit. Upon termination of this Lease Agreement,
      Tenant shall request' in writing the Security Deposit (or the remaining
      balance after use by Landlord to cover any payment (including Rent) or
      other: allowable expense under this Lease Agreement) after Landlord (i)
      has inspected the Leased Premises; (ii) confirms that the Leased Premises
      have been surrendered according to Article XIX and the other pertinent
      terms and conditions of this Lease Agreement; and (iii) determines that no
      environmental deficiencies exist which are attributable to or a
      consequence of the operations of Tenant at the Leased Premises.

                                       6
<PAGE>

6.04  Transfer of Security Deposit. In the event of sale, assignment or transfer
      of the Leased Premises by Landlord to a third party, Landlord shall be
      entitled to transfer the Security Deposit to its successor, who shall
      thereafter be solely and exclusively liable for the return of the Security
      Deposit, and Landlord shall be released upon said transfer from any claim
      or liability towards Tenant regarding the Security Deposit or its return
      upon termination of this Lease Agreement.

                                   ARTICLE VII

                          ALTERATIONS AND IMPROVEMENTS

7.01  General Provisions. Except for the repairs and improvements, if any,
      Tenant is to make to the Leased Premises according to Attachment D hereto,
      Tenant takes possession of the Leased Premises, and the special facilities
      described in Attachment A, if any, in their present "as is" condition and
      acknowledges that said property is in good state of repair.

7.02  Alterations and Improvements. Except for the work described in Attachment
      D, if any, for which Landlord has agreed to reimburse Tenant, all
      alterations, changes, additions or improvements necessary for the Leased
      Premises to be used for the purposes set forth in Section 1.07 of this
      Lease Agreement, shall be paid for by Tenant. Tenant shall make no
      alterations, changes, additions or improvements without Landlord's prior
      written consent except for the work described in Attachment D, if any,
      which Landlord expressly authorizes Tenant to undertake.

7.03  Air Conditioning Electric Power Generator. Tenant may, at its own expense,
      install an air conditioning system and/or an electric power generator at
      the Leased Premises, subject to Landlord's previous written approval. Any
      installations of such equipment shall be made in coordination with
      Landlord.

7.04  Sprinkler System. Tenant shall implement the necessary security measures
      to avoid or reduce the risk of fire due to the storage of flammable
      materials or products. If required by law, Tenant shall install a
      sprinkler system at its own cost and expense. It shall be Tenant's
      obligation to obtain the necessary endorsements and/or approvals of the
      Puerto Rico Fire Department for such installation.

7.05  Floor Load. Tenant acknowledges having been informed by Landlord that the
      Building's maximum sustainable floor load is one hundred and fifty (150)
      pounds per square foot. In the event that the type of machinery and/or
      equipment to be installed, stored and/or utilized by Tenant for its
      operations in the Building exceeds said maximum floor load limit, Tenant
      shall, at its own expense, make the necessary improvements to the Building
      which will allow the Building floor to sustain the maximum load required
      by Tenant's operations without affecting or damaging the strength or
      stability of the Building.

7.06  Liens and Encumbrances. (a) Tenant may not create nor allow the filing of
      any lien against the Leased Premises.

                                       7
<PAGE>

      (b)   Tenant certifies and guarantees that all materials used in or for
            any construction or work in the Leased Premises shall be free of
            liens and encumbrances at the time said materials are incorporated
            into the Leased Premises. At the time the construction or work
            begins, Tenant shall certify to Landlord that the materials to be
            used are free of liens and encumbrances.

      (c)   Tenant shall immediately notify Landlord regarding any lien or
            attachment on materials or supplies used in construction or work at
            the Leased Premises which become incorporated into the Lease
            Premises. Should an attachment be placed upon the Leased Premises or
            any other type of lien be created that may directly or indirectly
            affect the Leased Premises, Tenant will quickly take any action,
            including payment of the amount claimed, necessary to cancel said
            attachment or lien and release the Leased Premises from the lien in
            a term not greater than thirty (30) days from the date that the lien
            is filed. Should the lien Dot be canceled within the period provided
            above in addition to any other rights or remedies available to
            Landlord, Landlord may, but is not obligated to, obtain the
            cancellation of the lien by making payment of the amount claimed, by
            posting of a bond for the amount of the lien, or by any other
            procedure that Landlord deems appropriate; and any expense incurred
            in said effort, including attorneys' fees incurred by Landlord,
            shall be paid by Tenant as Additional Rent.

7.07  Ownership or Improvements: Surrender. (a) Upon termination of the Lease
      Agreement, all alterations, changes, additions, or improvements made by
      Tenant to the Leased Premises with incentives, credits, or other economic
      assistance from Landlord shall be deemed incorporated into the Leased
      Premises and therefore property of Landlord, with no rights of Tenant to
      any compensation or reimbursement therefor by Landlord. Landlord may
      require Tenant to remove, at Tenant's expense, any or all such
      alterations, changes, additions, or improvements upon termination of the
      Lease Agreement.

      (b)   Upon termination of the Lease Agreement, Tenant, unless specifically
            permitted by Landlord, shall remove, at Tenant's expense, those
            improvements (i) installed by Tenant in the Leased Premises at
            Tenant's cost and expense, or (ii) installed by a prior tenant and
            ownership hereof was accepted by Tenant, or (iii) not identified as
            special facilities on Attachment A.

      (c)   Tenant, after removal of any alterations, changes, additions or
            improvements, shall restore the Leased Premises to a condition
            reasonably similar to their condition when delivered to Tenant.

7.08  Plans and Specifications. Should Tenant request the consent of Landlord to
      effect any alteration, change, addition, or improvement, Landlord may, at
      its option and in its discretion, require Tenant to submit to Landlord for
      approval plans and specifications for the proposed work, including such
      work, if any, as described in Attachment D. Said plans and specifications
      must be submitted and approved by the pertinent governmental entities
      prior to Tenant's commencement of any work.

                                       8
<PAGE>

                                  ARTICLE VIII

                             MAINTENANCE AND REPAIRS

8.01  Tenant's Duties and Responsibilities. (a) Except for those repairs that
      according to Section 8.02 are Landlord's responsibility, Tenant shall
      maintain in good condition, at its own cost and expense, the Leased
      Premises, with all improvements including, but not limited to, the
      exterior premises, the Building, the special facilities, stairs,
      elevators, ramps, sidewalks, curbs, roads, landscaping, the ground and
      underground of the Leased Premises, and the pipes, lines, cables or ducts
      and other utility connections that service the Leased Premises. Any repair
      to the Leased Premises is Tenant's responsibility, unless said repair is
      necessary as a consequence of the negligence or some intentional act of
      Landlord, its agents, employees or contractors. As appropriate, Tenant
      shall (i) repair or replace doors, windows and their frames; the
      electrical system; the air conditioning and/or ventilation system; the
      plumbing, sanitary and sewage systems as well as the equipment, machinery,
      facilities or objects within the Leased Premises or that form part of the
      Leased Premises with the same type and quality; and (ii) paint the
      interior and exterior of the Building.

      (b)   Tenant shall also maintain the Leased Premises and its surroundings
            free of insects, rodents and pests; (ii) free of garbage, refuse,
            debris and any other solid waste; and (iii) free from unpleasant or
            offensive odors. Moreover, Tenant shall maintain the drainage and
            sewer systems of the Leased Premises free from obstructions.

      (c)   If Tenant fails to make any repair or if any repair is performed in
            an unsatisfactory manner, or if equipment is not replaced when
            necessary, Landlord may, but is not obligated to, undertake any such
            repair or replacement. Tenant shall reimburse Landlord for all costs
            incurred in any such repair or replacement plus an additional thirty
            percent (30%) of the cost of any such repair or replacement in order
            to cover Landlord's administrative costs. Any such costs reimbursed
            by Tenant including the additional percentage charge established
            above shall be considered Additional Rent, and as such, shall be
            paid within the period provided in Article V of this Lease
            Agreement. Tenant shall bold Landlord harmless from any damage or
            inconvenience suffered by Tenant as a consequence of any repairs
            performed by Landlord as provided in this paragraph, and Tenant
            shall have no rights of adjustment or reduction in Rent in
            connection therewith.

      (d)   Tenant shall perform all maintenance work necessary to ensure that
            all its equipment and operations fully comply with the applicable
            fire prevention standards and environmental requirements, legal or
            regulatory.

      (e)   The provisions of this Section 8.01 shall not be applicable in. the
            case of damage or destruction resulting from fire or any other event
            covered by Article XIII of this Lease Agreement.

                                       9
<PAGE>

8.02  Landlord's Duties and Responsibilities. Landlord shall be solely and
      exclusively responsible for any necessary repairs or restorations due to
      defects in the design of the Building or construction defects thereof, not
      apparent at the moment Tenant inspected the Leased Premises prior to
      occupancy. Except as provided in this Section 8.02, Landlord shall not be
      responsible for any repair, replacement or improvement to the Leased
      Premises or to equipment, machinery, facilities, furniture or any other
      object within the Leased Premises, all of which shall be the
      responsibility of Tenant as provided in Section 8.01 of this Lease
      Agreement.

8.03  Roof Care and Maintenance. Tenant shall not, without the previous written
      consent of Landlord: (i) place any fixture, equipment or other load on the
      roof of the Building; (ii) perforate the Building's roof; or (iii) use the
      roof of the Building for storage. Tenant shall take all necessary measures
      to maintain the roofs drainage system free from obstructions and in good
      and working condition at all times. Prior to undertaking any repairs to
      the Building's roof, Tenant shall submit in writing to Landlord a detailed
      description of the work to be performed and provide any other pertinent
      information related to said repairs Landlord may request.

                                   ARTICLE IX

                                PUBLIC UTILITIES

9.01  Tenant's Duties and Responsibilities. Tenant shall pay for the cost of
      electricity, water, gas, telephone and any other utility service to the
      Leased Premises during the term of this Lease Agreement, including the
      period of time, if any, between the Date of Delivery of Possession and the
      Rent Commencement Date. Tenant shall request and coordinate the
      installation of metering devices and other mechanisms or systems necessary
      to obtain the various utility services for the Leased Premises, and shall
      be liable for any deposit and/or installation charge required by the
      corresponding agency or utility company.

9.02  Service Interruption. Tenant shall not make adjustments to the Rent nor
      hold Landlord liable for any utility service interruption to the Leased
      Premises or for damages suffered as a consequence of any interruption.

9.03  Electricity. (a) Electric Power. In the event that the Leased Premises are
      not connected to the electrical service lines of the Puerto Rico Electric
      Power Authority (hereinafter "PREPA"), said connection shall be made at
      the expense of Tenant and in coordination with Landlord, including as to
      the purchase and installation of any equipment necessary to make the
      connection, which equipment must meet PREPA's requirements.

      (b)   Electrical Substation. Tenant, at its own cost and expense and
            without any right to reimbursement from Landlord, may build or
            install in coordination with Landlord an electric energy Substation
            on the Leased Premises and connect it to PREPA's distribution lines,
            subject to compliance with PREPA's requirements. Under no
            circumstances shall Tenant install an electrical substation without

                                       10
<PAGE>

            Landlord's prior approval as to the capacity and power of said
            substation, its location within the Leased Premises, and the routing
            path of the power lines.

      (c)   Additional Equipment. The Leased Premises are equipped with a basic
            electrical power system for general lighting and wall outlets
            connected to a 200 amp meter box designated for a secondary voltage
            of 120-208 volts. Tenant covenants not to install or use any
            equipment that will exceed or which reasonably could exceed the
            capacity of the Leased Premises power lines without Landlord's prior
            consent. Tenant, at its cost and expense, will upgrade the
            electrical service lines in accordance with the plans and
            specifications previously approved in writing by Landlord should
            Tenant's operations require greater electrical service line
            capacity.

9.04  Water Supply. (a) Should Tenant require water volume and/or water pressure
      greater than that existing in the area of the Leased Premises, the
      construction and/or installation of any improvements (including
      structures), that are necessary. convenient or required by the Puerto Rico
      Aqueduct and Sewer Authority (hereinafter "PRASA") to increase said volume
      and/or pressure, shall be made at Tenant's own expense and coordinated
      with Landlord, but without any right to reimbursement from Landlord for
      any such improvements.

      (b)   Should PRASA require improvements to the Leased Premises' water main
            connection, Tenant shall perform the corresponding improvements at
            its own expense, and only after written approval has been given by
            Landlord.

                                    ARTICLE X

                                 QUIET ENJOYMENT

10.01 Quiet Enjoyment. Upon Tenant's payment of Rent and observance of all other
      terms, covenants and conditions of this Lease Agreement that arc to be
      observed and performed by Tenant, Landlord covenants that Tenant may
      peaceably and quietly enjoy the Leased Premises, during the Term, or until
      the termination of the Lease Agreement in accordance with Article XVIII.

                                   ARTICLE XI

                          TAXES, ASSESSMENTS AND DUTIES

11.01 Taxes, Assessments and Duties. Tenant shall be liable for the payment of
      all taxes, assessments, duties or any other tax levied by any government
      entity having taxing authority over real property, personal property
      and/or the activities directly or indirectly related to Tenant's
      operations at the Leased Premises, including. but not limited to, personal
      property taxes on equipment and machinery located at the Leased Premises.
      Tenant shall pay these taxes, assessments, and duties before their due
      date.

                                       11
<PAGE>

                                  ARTICLE XII

                                 ENVIRONMENTAL

12.01 Governmental Regulations and Environmental Protection. Tenant shall comply
      with all laws, roles, regulations, executive orders. administrative orders
      and requirements of local and federal governmental agencies having
      jurisdiction over Tenant's operations at the Leased Premises. Upon request
      by Landlord. Tenant shall submit evidence of said compliance and if any
      permits, and agency endorsements such as, but not limited to:

            (i)   the Puerto Rico Fire Department;

            (ii)  the Puerto Rico Department of Health;

            (ii)  the U.S. Food and Drug Administration (FDA);

            (iii) the Puerto Rico' Occupational Safety and Health Office
                  (PROSHO);

            (v)   the Puerto Rico Environmental Quality Board (EQB);

            (vi)  the U.S. Environmental Protection Agency (EPA);

            (vii) the Puerto Rico Aqueduct and Sewer Authority (PRASA);

            (viii) the Puerto Rico Natural and Environmental Resources
                  Department ("DNER")

            (ix)  the Regulations and Permits Administration ("ARPE");

            (x)   the Puerto Rico Planning Board;

            (xi)  the Solid Waste Administration;

            (xii) the pertinent Municipal Government.

      Tenant shall maintain the Leased Premises and conduct its operations
      thereat in compliance with the tenus, conditions, and requirements
      specified in (i) the Environmental Impact Statement, or any other document
      prepared for the evaluation of environmental aspects of its operations at
      the Leased Premises; and (ii) the permits issued by the governmental
      agencies with jurisdiction over the operations at the Leased Premises.

      Tenant, at its own cost and expense, shall install on the Leased Premises
      the necessary equipment to prevent its operations from affecting adversely
      the environmental integrity of the Leased Premises, or causing any
      disturbance to the adjacent properties or to the community in general.

      Any improvements or installation of equipment for pollution controls
      required by any agency or governmental entity having jurisdiction thereof
      shall be at Tenant's expense and subject to Article VII of this Lease
      Agreement. Tenant shall also comply with the following permits and
      regulations, without limitation of any other applicable environmental
      requirements:

      (a)   Wells. Landlord will not allow the drilling of a water well at the
            Leased Premises unless Tenant's operations at the Leased Premises
            require a volume of water greater than that which PRASA can supply.
            In such case Tenant will obtain a construction permit and a
            franchise from the Department of Natural and Environmental Resources
            to drill such well and to extract water therefrom. For

                                       12
<PAGE>

            any other type of well (i.e., monitoring. injection, etc.) Tenant
            shall obtain the necessary permits and Landlord's written consent.

      (b)   Noise. Tenant shall not exceed the maximum noise levels allowed by
            the Noise Pollution Control Regulation of the Puerto Rico
            Environmental Quality Board.

      (c)   Air Emissions. Tenant shall obtain all the necessary construction
            and operational permits necessary to construct, install, and operate
            any air emissions source or atmospheric pollution source, as.
            defined by the Regulation for the Control of Atmospheric Pollution
            Sources of the Environmental Quality Board and the Federal
            Regulations. This includes, but is not limited to (i) ventilation
            systems to disperse atmospheric emissions resulting from Tenant's
            operations; (ii) electric power generators for emergency use; (iii)
            storage tanks for flammable gases with a capacity greater than five
            hundred (500) gallons; and (iv) fuel. storage tanks (gasoline,
            diesel. kerosene, acetone, alcohol and others) having a capacity of
            more than ten thousand (10,000 gallons). Tenant, at its own cost and
            expense, shall establish the necessary measures and shall install
            the equipment required to maintain the air quality standards
            established by the existing laws and regulations and any amendments
            thereto as required by the permits issued by the Environmental
            Protection Agency and the Environmental Quality Board.

      (d)   Gas Storage Tanks. Tenant shall obtain a permit from the Public
            Service Commission to install and/or store flammable gases in
            aboveground storage tanks.

      (e)   Underground Storage Tanks. Tenant shall not install underground
            tanks to store fuels, raw materials or chemical substances. In the
            event that any such tanks have been previously installed at the
            Leased Premises and removal thereof would constitute a risk to the
            Leased Premises or to Tenant's operations, such tanks shall be used
            only if they comply with federal and state regulations for
            underground storage tanks.

      (f)   Aboveground Storage Tanks. Tenant shall prepare and implement a
            Spill Prevention, Control and Countermeasure Plan ("SPCC Plan") as
            applicable and required by 40 CPR 112 and the Water Quality
            Standards Regulation of the Environmental Quality Board for the
            installation and operation of aboveground storage tanks.

      (g)   Chemicals. Storage of any chemical substance shall be undertaken in
            full observance of the, applicable safety measures required by the
            governmental agencies having jurisdiction thereof so as to prevent
            any leakage or spillage that may contaminate the Leased Premises or
            adjacent properties.

      (h)   QSHA. Tenant shall strictly comply with the rules established by the
            Occupational Safety and Health Administration ("OSHA") for the
            storage of dangerous materials (29 CFR 1910.101 to 1910.106) as well
            as with the Puerto Rico Fire Department Regulations for Fire
            Prevention.

                                       13
<PAGE>

            (i)   Industrial and Sanitary Effluents. Tenant shall not discharge
                  its sanitary or industrial effluents into the sewer system nor
                  into any other place until Tenant has obtained the necessary
                  authorization to do so, be it from the Puerto Rico Aqueduct
                  and Sewer Authority, from the Environmental Quality Board, or
                  the Environmental Protection Agency ("EPA"), as applicable.
                  Tenant shall request and obtain the necessary permits and/or
                  endorsements from the Environmental Quality Board or any other
                  local or federal agency with jurisdiction in order to install
                  and operate any treatment or pretreatment plant or system for
                  said effluents. Tenant must obtain Landlord's endorsement and
                  approval to install a treatment or pretreatment plant or
                  system prior to any request for the permits and endorsements
                  of the other pertinent government agencies with jurisdiction.
                  Tenant shall treat its effluents as required prior to
                  discharge, as required by the pertinent governmental agency
                  having jurisdiction.

            (j)   Septic Tanks and Systems. Should the Leased Premises have a
                  septic tank or system, such facility can be only to discharge
                  sanitary effluents. Therefore, Tenant shall not discharge
                  industrial effluents nor any substance nor material other than
                  sanitary effluent into the septic tank or system. Moreover,
                  Tenant must obtain from the Environmental Quality Board a
                  permit to operate said septic tank or system. Any industrial.
                  effluent that may be generated and that is not discharged into
                  the Aqueduct and Sewer Authority sewer system or through a
                  discharge permit from the National Pollutant Discharge
                  Elimination System ("NPDES"), shall be disposed of by
                  transporting it to an Aqueduct and Sewer Authority treatment
                  plant, with previous authorization, or to another entity
                  authorized to handle such effluents.

            (k)   NPDES Permit. Tenant shall not discharge any industrial
                  effluent into the ground. Tenant shall obtain an NPDES permit
                  to discharge stormwater or other effluents into a body of
                  water. Tenant shall obtain an NPDES permit, if stormwater
                  run-off is exposed to raw materials, unfinished or finished
                  products, waste, by-products. industrial machinery or
                  equipment, a materials handling area or a process area. Tenant
                  shall obtain, when applicable, the pertinent industrial
                  discharge permit or pre-treatment permit required by PRASA.

            (l)   Hazardous Substances. Tenant win not treat, store or dispose
                  of any hazardous substance at the Leased Premises, unless
                  Tenant possesses the necessary permits from the agencies with
                  jurisdiction and such activities are performed in compliance
                  with applicable regulations and the terms and conditions of
                  the permit. Tenant will not generate or store. any hazardous
                  substance or waste at the Leased Premises without first
                  obtaining the necessary permits from the local and federal
                  agencies with jurisdiction. The generation and storage of
                  hazardous substances shall be conducted in compliance with
                  applicable environmental laws, regulations and permits. Also,
                  Tenant shall not store hazardous waste at the Leased Premises,
                  without fm giving notice to Landlord of the location of the
                  storage area and providing evidence of compliance with state
                  and federal

                                       14
<PAGE>
            regulations as well with the measures Landlord considers necessary
            to protect the Leased Premises. At no time shall Tenant dispose of
            any hazardous substances or waste at the Leased Premises.

      (m)   Non-hazardous Solid Waste. Non-hazardous solid waste generated from
            the operations at the Leased Premises shall be stored, handled,
            transported and disposed of in accordance with the Environmental
            Quality Board's Hazardous and Non-hazardous Waste Control
            Regulations. Tenant must obtain a permit from the Environmental
            Quality Board for a Non-hazardous Waste Generating Activity (DS-3),
            when it generates more than fifteen (15) cubic yards of
            non-hazardous solid waste weekly during construction activities.
            Tenant, at its own cost and expense, shall keep the grounds clean
            and tree of solid wastes, rubbish, garbage and debris.

      (n)   Equipment or Materials Containing Polychlorinated Biphenyls ("PCB").
            Tenant shall not install or introduce equipment or materials
            containing PCB's at the Leased Premises.

      (o)   Reports to Landlord. In addition to any other information or
            document that may be required hereunder, Tenant shall provide
            Landlord with the following:

            1.    Written notice, within forty-eight (48) hours, of any event
                  that requires verbal or written notice to the Environmental
                  Protection Agency, the Environmental Quality Board or any
                  entity designated by them, together with, a copy of any order,
                  communication or report regarding the event. This includes,
                  but is not limited to, any notice required under the
                  provisions of the "Emergency Planning and Community Right to
                  Know Act."

            2.    Written notice within forty-eight (48) hours of any change to
                  the hazardous materials handled at the Leased Premises, or if
                  Tenant observes or has any knowledge of an environmental
                  problem at the Leased Premises even if such problem is not a
                  result of Tenant's activities.

            3.    A copy of all the permits mentioned in this Article XII.

      (p)   Audits and Access to the Property. Landlord reserves the right to
            inspect the Leased Premises, from time to time, during the Term of
            this Lease Agreement as deemed necessary, for the purpose of
            evaluating the environmental condition of the Leased Premises, and
            as to Tenant's compliance with federal and state environmental
            regulations and the provisions of this Article XII. Tenant, for this
            purpose, win provide Landlord with access to all areas or structures
            on the Leased Premises. Tenant shall provide access to all the
            books, registers, documents or instruments that Landlord deems
            necessary to determine the environmental condition of the Leased
            Premises, or compliance with environmental regulations.

                                       15
<PAGE>

      In the event that Landlord believes, based upon any inspection performed
      on the Leased Premises, that Tenant is in material violation of a federal
      or local environmental law or regulation, Landlord shall request Tenant to
      perform, at Tenant's cost, the environmental site assessments necessary to
      determine the existence and extent of contamination at the Leased
      Premises, if any and all activities of removal, mitigation and remediation
      needed to correct any environmental problem caused by the Tenant at the
      Leased Premises. Tenant, upon Landlord's request, at the termination of
      this Lease Agreement, shall submit an environmental site assessment, Phase
      I and/or Phase II, of the environmental condition of the Leased Premises
      prepared by an environmental consultant of proven experience. The
      assessment shall determine whether the activities performed by Tenant
      affected the conditions of the Building and the lot. The assessment shall
      be performed following the standards established for preparing such
      reports by the scientific community ("ASTM"). The assessments shall be
      signed and certified by an engineer or chemist licensed to practice in
      Puerto Rico.

      In the event that an environmental audit or inspection reveals an
      environmental deficiency or condition at the Leased Premises, Tenant shall
      submit an action plan to remedy such situation together with a bond or
      guarantee to secure payment of the remediation. The plan shall be reviewed
      and its execution coordinated with Landlord.

      (q)   Emergency Remediation Response Action. In the event of any hazardous
            substance spill, leak, or escape or any other occurrence which
            requires the removal of hazardous substances or environmental
            remediation, Tenant shall be responsible to remedy it immediately.
            Tenant shall be responsible for hiring. at its own expense, those
            companies with proven experience and reputation to perform said'
            removal activities and/or environmental remediation and shall carry
            out all the necessary negotiations to accomplish .aid removal and/or
            remediation. Prior to the formation of any contractual agreement
            with any company or consultant for the removal and/or, remediation,
            the company or consultant must be approved by Landlord. The scope of
            work prepared by the Landlord authorized company shall be submitted
            to Landlord for its approval. In the event of any violation or
            contamination of the Leased Premises, Landlord may request Tenant to
            remain in the Leased Premises and' to continue paying Rent until the
            Leased Premises are in compliance with local and federal
            regulations. At all times, Tenant shall be obligated to immediately
            notify Landlord in writing upon occurrence of any event that
            requires removal of contaminants or environmental remediation and
            shall coordinate with Landlord any clean-up, contamination removal,
            or environmental remediation before commencement thereof provided
            that if the event which requires removal of contaminants or
            environmental remediation should occur during non-working periods,
            in which case (such weekends or holidays) Tenant shall immediately
            notify Landlord the next working day. The notice to Landlord by
            Tenant in the event of a spill, leak or escape does not release
            Tenant of its obligation to notify the pertinent governmental
            agencies as required by law, regulation, municipal ordinance,
            judicial order, executive order, administrative order or by any
            other legal requirement.

                                       16
<PAGE>

      Should any environmental mishap occur, such as, but not limited to, a
      spill, release or leak that poses an imminent danger to human health or to
      the environment, in addition to taking all such protective measures,
      responses and notifications as are required by environmental laws,
      regulations, and permits, Tenant shall cease its operations if Tenant's
      operations are the direct cause of said environmental mishap until said
      mishap is controlled and all risk to human life or to the environment is
      suppressed.

      (r)   Environmental Conditions Liability. Tenant shall be liable for any
            environmental damage and the necessary or `remedial action as
            results from Tenant's operations. Tenant shall indemnify Landlord
            for any lawsuit, civil or criminal action, administrative action,
            fine. claim, remedial action and/or clean-up and/or pollutant
            removal action, toxic or hazardous substance or waste as deemed in
            local and federal haws and regulations, that may arise as a result
            of Tenant's operations or during Tenant's occupation of the Leased
            Premises. The term contaminant includes petroleum and its
            derivatives, asbestos, and PCB. Tenant shall also be liable and
            shall indemnify Landlord for any complaint, civil or criminal
            action, administrative action, fine or claim that arises as a result
            of any violation of any law, regulation, rule, Administrative Order,
            Executive Order or environmental requirement of any local or federal
            governmental entity that arises as a result of Tenant's operations
            .or during the term Tenant occupied the Leased Premises. Tenant's
            liability toward Landlord and its obligation to indemnify Landlord
            shall survive the termination of this Lease Agreement.

                                  ARTICLE XIII

                             DESTRUCTION OF PREMISES

13.01 Notice of Event. Tenant shall immediately notify Landlord after any fire,
      explosion, spill of hazardous wastes or pollutants (except as otherwise
      provided in Article XII and Section 13.06 herein) or any other kind of
      accident or extraordinary event which causes or threatens damage to the
      Leased Premises.

13.02 Landlord's Duty to Repair. Should the Leased Premises be damaged by fire,
      explosion or any other casualty covered by the insurance policies as
      required by this Lease Agreement, Landlord shall repair or restore the
      Leased Premises to a condition substantially similar to that before the
      accident or event, provided that:

      (i)   Landlord has received the corresponding insurance proceeds from the
            insurance company; and

      (ii)  the accident or event causing the damage is not attributable to or
            did not occur as a consequence of negligence, an omission, or
            intentional act of Tenant or any of its employees, agents, visitors
            or representative,;; nor as a result of acts by any of them in
            violation of a federal, state, or municipal law regulation, order,
            ordinance, or breach of any obligation or condition under this Lease
            Agreement.

                                       17
<PAGE>

      Tenant recognizes that Landlord's duty to repair damage or destruction to
      the Leased Premises is limited to those repairs made possible by the
      proceeds received as a result of the insurance policies required
      hereunder, and that. Tenant shall be responsible for the deductibles or
      the amount in excess of the insurance proceeds necessary to cover the
      costs to repair, reconstruct, or replace the Leased Premises.

13.03 Lease Agreement Termination. Notwithstanding the provisions of Section
      13.02, Landlord shall have the option to terminate this Lease Agreement in
      any of the following circumstances:

            (i)   should the insurance policy as required by this Lease
                  Agreement not provide coverage for the accident or event which
                  damages the Leased Premises;

            (ii)  the damage suffered by the Leased Premises is such that it
                  exceeds the cost of replacement; or

            (iii) if the Building and other structures of the Leased Premises,
                  in the opinion of Landlord, cannot be repaired in a period of
                  one hundred twenty (120) days from the day the accident or
                  event occurred;

            (iv)  should the damage to the Building be so extensive that
                  Landlord decides to demolish it; or

            (v)   should the accident or event occur at any time during the last
                  two (2) years of the term of this Lease Agreement.

      In any of the above circumstances Landlord may terminate this Lease
      Agreement by written notice to Tenant within ninety (90) days from the
      date the accident or event occurred, in which case both parties are
      released of any further liability under this Lease Agreement as of the
      effective. date of termination except for those that survive termination
      pursuant to Article XII hereof.

13.04 Restoration. Should Landlord have the obligation to repair or restore the
      Leased premises according to Section 13.02, or should Landlord not
      terminate this Lease Agreement as provided in Section 13.03, and proceeds
      to repair or restore the Lease Premises, Tenant shall hold Landlord
      harmless for the loss of any equipment, machinery or any other property
      that Tenant had placed, joined, built-in or installed, or kept at the
      Leased Premises.

13.05 Rent Adjustment. Should the Leased Premises be damaged or destroyed and
      Landlord elects to. repair (provided that the cause of the fire or
      accident is not the result of any negligence, omission or any intentional
      act of Tenant, its employees, agents, guests or representatives, nor the
      violation by any of them of any federal, state, or municipal law,
      regulation, order, ordinance, nor the failure to comply with any
      obligation or condition

                                       18
<PAGE>

      under this Lease Agreement), Tenant shall have a right to adjust the Basic
      Rent in proportion to the total area of the Leased Premises that becomes
      untenantable during the repair period (i.e., from the date of the accident
      or event until the date Landlord finishes the repair work). Should
      Landlord terminate this Lease Agreement due to any of the causes set forth
      in Section 13.03, the Rent shall be due until the date of the casualty or
      destruction.

13.06 Damage Report. In the event of a casualty or disaster, Tenant shall
      complete and deliver to Landlord the form "Disaster Impact Quantification
      (CD1001)" (Attachment G hereto) within eighteen (18) hours after the
      occurrence of the event.

                                   ARTICLE XIV

                        WAIVER OF CLAIMS; INDEMNIFICATION

14.01 Indemnification. Tenant shall defend, `indemnify and hold harmless
      Landlord, its directors, officers, employees, invitees, representatives,
      successors and assignees of liability from any loss, claim, fine, penalty,
      attachment, action or complaint of any type or kind, including any
      incidental expense or cost (including, but not limited to, defense costs,
      settlement and attorney fees) in relation to or as a consequence of any
      damage to a third party (including death), or any damage, loss or
      destruction of any third party's property, (a) in or around the Leased
      Premises due to any act or omission of the Tenant or any of its employees
      (whether or not said act is within the scope of employee's job), agents,
      authorized persons, visitors, successors or assignees, or caused wholly or
      in part by any act or omission of any of the former or (b) due to the use
      or occupation of the Leased Premises by Tenant, its agents, employees,
      invitees, or visitors; (ii) violation of any federal or state law or
      regulation, or municipal ordinance, or of any judicial or administrative
      order, as a direct indirect consequence of the use or occupation of the
      Leased Premises by Tenant; (iii) or due to breach of any of the
      obligations under this Lease Agreement. The provisions of this Article XIV
      shall survive and remain in full force after the expiration of the Term or
      the termination of this Lease Agreement.

14.02 Waiver of Claims. Landlord shall not be liable, and Tenant releases
      Landlord and waives any claim against Landlord, for any damage to or loss
      of any property located at the Leased Premises which belongs to Landlord
      and/or its agents, employees, invitees and/or visitors, and for any other
      damage or loss suffered by Tenant, or any damage or loss to Tenant which
      arises from fire, steam, or smoke; short circuit; water, electricity, gas
      or other utility failure; rain, storms, hurricanes or other weather
      conditions; flood or leakage; defects in pipes, cables, appliances,
      plumbing and/or air conditioning systems, regardless if such damage or
      inconvenience is the result of the condition or working order of the
      Leased Premises, or any part of it. Landlord shall not be liable for any
      damage or loss suffered by Tenant and/or its agents, employees, invitees
      and visitors as a result of criminal conduct, intentional acts, and/or
      negligent or intentional acts of a third party or of Tenant, its agents,
      employees, invitees and/or visitors. Tenant waives and shall be barred
      from filing any claim against Landlord for any damage or loss at the
      Leased

                                       19
<PAGE>

      Premises or to any person or property within the Leased Premises for any
      cause other than gross negligence by Landlord.

14.03 Tenant Responsible For Personal Property. Tenant recognizes that Landlord
      shall not be liable and waives any claim for any damage to personal
      property in the Leased Premises that belongs to Tenant, or for the theft
      or misappropriation thereof. Tenant bears all risk for any damage or loss
      of any personal property of Tenant.

                                   ARTICLE XV

                                    INSURANCE

15.01 Insurance. During the Tenn of this Lease Agreement, Tenant shall maintain
      in force the following insurance policies:

      (a)   public liability, including, contractual liability, with limits of
            not less than $1,000,000 for bodily injury (including death) and
            $1,000,000 for property damage, per occurrence, which will insure
            Tenant against any claim for accidents in or around the Leased
            Premises due to use or occupation of the Leased Premises by Tenant.
            This insurance shall include Landlord and its agents, officers,
            directors and employees as additional insureds, and said policy
            shall include a "fire legal liability" endorsement;

      (b)   property insurance with "All Risk" coverage, for one hundred percent
            (100%) real property replacement cost, including foundations, with
            an extended coverage endorsement, which names Landlord as
            beneficiary in case of 1088. This insurance shall include coverage
            for fire, hurricanes, floods, earthquakes. and other events of a
            similar nature, vandalism and malicious mischief, boilers and
            machinery (if applicable) in building format and content, including
            all changes, alterations, extensions and improvements made by Tenant
            to the Leased Premises;

      (c)   pollution liability if required by Landlord because of the type of
            the operations carried on by Tenant; and,

      (d)   any other insurance over the Leased Premises which provides adequate
            coverage for those insurable risks that are common for property
            similar to the Leased Premises.

      The deductibles of the insurance policies herein required shall be
      Tenant's responsibility and should Landlord undertake any repairs after
      any loss or damage to the Leased Premises, Tenant shall reimburse Landlord
      the deductible payable under the insurance policy, together with any
      amount paid by any insurance provider.

15.02 Insurance During Construction. During any construction period at the
      Leased Premises, including the work to be performed by Tenant described in
      Attachment D, if any, Tenant must have in force the following insurance
      policies:

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<PAGE>

            (i)   "builders risk" insurance which provides coverage for all
                  improvements that arc being constructed, equivalent to one
                  hundred percent (100%) of their replacement value;

            (ii)  if the estimated cost of construction is over five thousand
                  dollars ($5,000), Tenant must, at Tenant's own cost and
                  expense, provide Landlord with a performance bond from a
                  surety company recognized and approved by Landlord, of other
                  satisfactory guarantee acceptable to Landlord, in a sum equal
                  to the estimated cost of said construction to guarantee
                  completion of any construction within a reasonable time. At
                  Landlord's option, instead of Tenant's obtention of a separate
                  bond or guarantee for each project that may be in process at
                  any given time, Tenant shall provide Landlord with one bond or
                  guarantee that covers all alterations, changes, additions or
                  improvements and other construction occurring at the same
                  time; and,

            (iii) Workers' Compensation from the State Insurance Fund
                  Corporation in such coverage amounts as required by law.

15.03 Insurance Policy Increase. Tenant will pay any premium increase required
      by an insurance company to cover additional risks resulting from any
      alteration, change, addition or improvement made by Tenant to the Leased
      Premises.

15.04 General Requirements. All insurance policies required of Ten ant under
      this Article XV must comply in form and substance to Landlord's
      requirements, and must provide the following: (i) that the insurance
      coverage may not be reduced, canceled or not renewed by the insurance
      company without written notice to Landlord and Tenant at least sixty (60)
      days in advance (unless said cancellation is due to failure to pay
      premium, in which case notice must be sent at least thirty (30) days in
      advance); and (ii) that the policy shall be immediately renewed by Tenant
      on or before its expiration date. Tenant must obtain said policies from
      insurance companies duly authorized to do business in Puerto Rico, and
      acceptable to Landlord. Said insurance companies shall have a
      classification of not less than "A" and a financial rating of "IV" or
      better, as rated by A.M. Best and Company.

15.05 Insurance Certificates. Before the Date of Delivery of Possession Tenant
      shall submit to Landlord the policies (or certified copies) of same
      required under this Article XV with all the mentioned endorsements, and
      certificates of insurance which evidence the required coverage by Sections
      15.01 and 15.02 of this Lease Agreement. Tenant expressly recognizes.
      Landlord's right not to deliver the Leased Premises to Tenant until two
      (2) days after the policies (or certified copies) and the insurance
      certificate. have been submitted to Landlord, as required in this section.

15.06 Evidence of Payment; Renewal of Policies. Tenant must deliver to Landlord
      satisfactory evidence of payment of the insurance premiums within fifteen
      (15) days of the respective

                                       21
<PAGE>

      renewal dates of the respective policies and at the same time submit the
      corresponding insurance certificate or certified copy of each renewed
      policy.

15.07 Claims. Tenant shall cooperate with Landlord in the collection of claims
      against the corresponding insurance companies in those cases where
      Landlord handles such claims, including the preparation of damage reports
      and other documents required to process the claim. In the event Tenent
      does not provide said documents, Landlord, as Tenant's agent, and
      attorney-in-fact, shall, in addition to any other remedy available to
      Landlord, execute and submit any evidence of loss and/or any other
      document necessary for collection of the claim.

15.08 Periodic Review. Landlord reserves the right to review and demand
      periodically increases in the limits of the coverages required in this
      Lease Agreement as results from the effects of inflation.

15.09 Penalties. Notwithstanding the provisions of Section 22.08, and without
      affecting the general terms of the matters stipulated therein, should
      Tenant breach its duty to obtain any of the policies required in Article
      XV, which as a result renders it necessary for Landlord to obtain said
      policies, in addition to reimbursement for the premium paid for said
      policies, Tenant shall pay Landlord a sum equal to twelve percent (12%) of
      the cost of the policies obtained by Landlord to cover Landlord's
      administrative costs.

15.10 Waiver of Subrogation. (a) Landlord and Tenant agree that all fire and
      extended coverage and other property damage insurance carried by either of
      them in relation to the Leased Premises shall be endorsed with a clause
      providing that any release from liability or waiver of claim for recovery
      from the other party entered into in writing by the insured thereunder
      prior to any loss or damage shall not affect the validity of said policy
      or the right of the insured to recover thereunder, provided that the
      insurer waives all rights of subrogation which such insurer might have
      against the other party. Any release or any waiver of claim shall not be
      operative in any case where the effect of such release or waiver is to
      invalidate any insurance coverage or invalidate the right of the insured
      to recover thereunder. Should any waiver of subrogation result in a
      premium increase, Tenant shall, within ten (10) days of notice, pay said
      increase in order to maintain the effectiveness said release or waiver.

      (b)   Neither Landlord nor Tenant shall be liable to the other or the
            insurance company that provided the coverage for any loss or damage
            to any building or structure of the leased Premises for the loss of
            income either through subrogation or any other form, regardless if
            such loss or damage be, in whole or in part, caused by a negligent
            act or omission of the other party, its agents, officers, directors
            or employees, to the extent that such loss or damage is covered by
            insurance policy in favor of the affected party.

                                       22
<PAGE>

                                   ARTICLE XVI

                                LANDLORD'S RIGHTS

16.01 Access to Leased Premises. Landlord shall be entitled to enter the Leased
      Premises for the purposes of inspection to perform any repairs or work
      required pursuant to the provisions of this Lease Agreement, or for those
      repairs or work which Tenant has failed to do despite being responsible
      therefor under this Lease Agreement, or to show the Leased Premises to
      persons interested to lease or acquire the same. This right to access is
      subject to the following conditions: (a) if due to any emergency
      situation, which Landlord shall determine at its discretion, Landlord
      shall have full access to the Leased Premises at any time; (b) under any
      other circumstances Landlord shall have access to the Leased Premises
      during normal business hours; and (c) Landlord must maintain at a minimum
      any interruption to Tenant's operations during any exercise of its rights
      under this Article.

                                  ARTICLE XVII

                                TENANT BANKRUPTCY

17.01 Lease Agreement Assumption Requirements. The following provisions shall
      apply upon commencement of a voluntary or involuntary case under Title 11,
      United States Code, wherein Tenant is a debtor under 11 U.S.C. Sections.
      101 et seq. (the "Bankruptcy Code"), and only insofar as the Bankruptcy
      Code applies or affects the provisions of this Lease Agreement.

      (a)   Should the trustee or "debtor in possession" not elect to assume
            this Lease Agreement within a period of sixty (60) days from the
            commencement of proceedings under the Bankruptcy Code, this Lease
            Agreement shall be deemed rejected and terminated as provided under
            Article XVIII of this Lease Agreement (including any provisions as
            to damages) giving Landlord the immediate right to repossess the
            Leased Premises.

      (b)   Any assumption and/or assignment of this Lease shall not take effect
            unless there is compliance with the following:

            (i)   all Tenant's defaults have been cured and Landlord has been
                  provided with adequate and reasonably satisfactory assurances
                  of Tenant's future performance; if the Lease Agreement is
                  assigned, Tenant shall provide (1) any guarantee and/or
                  deposit reasonably required, and (2) any other reasonable
                  assurance that there will be sufficient funds and personnel
                  available to operate the Leased Premises in strict compliance
                  with the provisions of this Lease Agreement;

            (ii)  neither the assumption of this Lease Agreement nor the
                  operation of the Leased Premises after this Lease Agreement
                  has been assumed or assigned, in the reasonable opinion of
                  Landlord, win cause or result in breach or violation of any of
                  its provisions or of any other applicable contract with
                  Landlord;

                                       23
<PAGE>

            (iii) the assumption, and if applicable, the assignment of this
                  Lease Agreement fully complies with the provisions of the
                  Bankruptcy Code, including, but not limited to Sections
                  365(b)(1) and (3) and 365(t)(1) and (2) thereof; and

            (iv)  the assumption and/or assignment has been ratified and
                  approved through an or~ of the Bankruptcy Court or any other
                  court having jurisdiction.

      (c)   No assignment of this Lease Agreement by the trustee or the "debtor
            in possession" shall be valid unless the proposed assignee has also
            satisfied the conditions provided in paragraphs (b) (i), (ii), (iii)
            and (iv) of this section, and all other requirements established in
            this Lease Agreement which further Landlord's public policy of
            promoting employment and the industrial development of Puerto Rico
            which is accomplished by observing the capitalization, investment
            and employment levels stated in Section 1.08 and the continuance of
            operational requirements set forth in Section 4.02 of this Lease
            Agreement.

      (d)   Whenever a "debtor in possession" is required under the Bankruptcy
            Code to comply with its obligations as Tenant under this Lease
            Agreement, the Basic Rent and the other charges identified in this
            Lease Agreement as Additional Rent shall not be subject to
            adjustment and must be paid in full as provided in the pertinent
            sections of this Lease Agreement.

      (e)   Pursuant to Section 22.01 of this Lease Agreement, except where the
            provisions of the Bankruptcy Code mandates otherwise. the assignment
            of this Lease Agreement is prohibited.

      (f)   Unless agreed to by Landlord, under no circumstances will this Lease
            Agreement be renewed if the Term has expired or the Lease Agreement
            has terminated according to its provisions. No bankruptcy procedure
            shall annul, postpone or affect the expiration or termination of the
            Term of this Lease Agreement as provided in Article XVII, or prevent
            Landlord from recovering possession of the Leased Premises at the
            expiration of the Term or upon earlier termination of this Lease
            Agreement.

                                  ARTICLE XVIII

                              TERMINATION BY BREACH

18.01 Breach by Tenant as Cause for Termination. In addition to, and separate
      from, any other cause for termination set forth in this Lease Agreement or
      available under applicable law, each of the following events or acts shall
      be considered a breach and constitute cause for termination, which
      termination will be effective upon written notice to Tenant:

(a)   Tenant's failure to pay the Rent to Landlord within the term provided in
      Section 5.01 of this Lease Agreement, or upon failure to pay any other sum
      required to be paid hereunder within ten (10) days after its due date;

                                       24
<PAGE>

      (b)   Tenant's failure to pay the Rent to Landlord on or before the first
            day of the month, or failure to pay any other amount when due, on
            two or more occasions within any consecutive twelve (12) month
            period;

      (c)   Tenant's abandonment of the Leased Premises (as defined in Section
            18.03 of this Lease Agreement), upon certification of such
            abandonment by the procedure provided in clause (b) of Section
            18.03;

      (d)   if Tenant encumbers; assigns or transfers this Lease Agreement, in
            whole or in part, except as otherwise provided in this Lease
            Agreement;

      (e)   if Tenant makes a general assignment of its assets in benefit of its
            creditors;

      (f)   if Tenant fails to take physical possession of the Leased Premises
            within ten (10) days following the Date of Delivery of Possession;

18.02 Other Causes for Termination. In addition to the causes for termination
      set forth in Section 18.01, Landlord may terminate this Lease Agreement if
      Tenant fails to comply with any of Tenant's principal obligations
      hereunder within fifteen (15) days of receipt of written notice from
      Landlord requesting performance of any principal obligation. However, if
      Tenant shall have begun efforts toward performance within said fifteen
      (15) day period and continues to act diligently and makes every reasonable
      effort to perform, said period of fifteen (15) days may be extended by
      Landlord for a maximum period of sixty (60) days, as necessary for
      Tenant's performance of any principal obligation. Principal obligations
      under this Lease Agreement include, but are not limited to, the following:

            (i)   Tenant's compliance with the levels of capitalization,
                  investment, and employment as set forth in Section 1.08 of
                  this Lease Agreement;

            (ii)  the duty of Tenant to not interrupt operations at the Leased
                  Premises without prior notice to Landlord as provided in
                  Section 4.02(b) of this Lease Agreement and that such
                  interruption will not last for a period in excess of that
                  period notified to Landlord. No interruption shall exceed
                  three (3) months;

            (iii) the obligation of Tenant, when required hereunder, to submit
                  any plans for Landlord's approval or any other information in
                  connection with improvements and alterations to be made by
                  Tenant to the Leased Premises;

            (iv)  the compliance by Tenant of the environmental provisions of
                  Article XII of this Lease Agreement; and

                                       25

<PAGE>

            (v)   the prohibition to use or allow the Leased Premises or any
                  part thereof to be used for illegal purposes or for a use that
                  is not permitted by Section 1.07.

18.03 Abandonment. Tenant acknowledges that the Puerto Rico Industrial
      Development Company was established with the public purpose of promoting
      the creation of jobs and the continuous industrial development of Puerto
      Rico; that the capitalization, investment and employment levels, as
      detailed in Section 1.08, and the requirement of continued operations at
      the Leased Premises, in compliance with the provisions of Section 4.02,
      serve to that public purpose. In order to continuously and consistently
      comply with said public purpose, Landlord must maintain as available
      inventory the largest possible number of industrial facilities for the
      development of new projects or industries. Acts such as those described in
      clause (a) below, of this Section 18.03, defeat the purpose of this Lease
      Agreement, diminish the powers of the Landlord to maintain the largest
      number of industrial facilities in operation and in turn, impair
      Landlord's ability to pursue its established purpose. Therefore, Tenant
      recognizes that the delivery to Landlord of the keys to the Leased
      Premises constitutes conclusive proof of Tenant's intention to abandon the
      Leased Premises and any equipment, machinery, furniture or other property
      found within. Tenant also recognizes the fact that the voluntary
      abandonment of property at the Leased Premises through the delivery of the
      keys is incontrovertible evidence of Tenant's decision to forsake such
      property and renounce ownership thereat giving Landlord the absolute right
      to dispose of said property, as established in clause (b)(ii) below.

      (a)   For the purposes of this Lease Agreement Tenant has abandoned the
            Leased Premises upon the occurrence of any of the following events:

            (i)   should the Tenant deliver to Landlord the keys to the Leased
                  Premises;

            (ii)  should the Tenant cease operations and close. down the Leased
                  Premises, notwithstanding that equipment, machinery, furniture
                  or other property remain thereat; and/or

            (iii) if Tenant removes or transfers its operations, personnel or
                  equipment at the Leased Premises to another location, without
                  the consent of Landlord.

      (b)   The following procedure is adopted by the parties hereto to confirm
            the act of "abandonment" by Tenant under clause (a) of this Section
            18.03:

            (i)   If Tenant has incurred in any act of abandonment described in
                  Section 18.03(a), Landlord will send Tenant, by certified
                  mail, return receipt requested, a notice which will describe
                  the act of abandonment committed by Tenant. From the date of
                  said notice, Tenant shall have fifteen (15) days to
                  discontinue the abandonment or to dispute in writing the
                  information contained in Landlord's notice. Should the act of
                  abandonment notified by Landlord continue for more than the
                  fifteen (15)

                                       26

<PAGE>

                  days provided. herein, Landlord shall send a second notice to
                  reconfirm the act of abandonment, which notice will be
                  effective at the time the notice is sent.

            (ii)  Once the act of abandonment is reconfirmed as provided in
                  clause (b)(i) above, Landlord may declare this Lease Agreement
                  terminated by notice to Tenant and such termination shall be
                  effective as of the date mailed. The notice will contain a
                  request to Tenant to remove within ten (10) days all
                  equipment, machinery furniture or other property remaining at
                  the Leased Premises, and contain a warning to Tenant that if
                  such property is not removed in that time period, Landlord may
                  either remove and store said property, at its own discretion,
                  at the expense and cost of Tenant, or dispose freely of said
                  property as it deems convenient and Tenant will have no right
                  to claim or be compensated for the value of the abandoned
                  property or for any damage or loss caused by such removal by
                  Landlord.

      (c)   Subject to the performance of the procedure previously described,
            Tenant waives any claim and releases and holds Landlord harmless
            from any damage or loss that Tenant may suffer as a consequence of
            the removal and disposal of the property that Tenant has abandoned
            at the Leased Premises.

18.04 Termination by Tenant. Tenant may terminate this Lease Agreement, without
      penalty, should any of the following events occur:

      (a)   Tenant moves its operations to another of Landlord's premises having
            greater capacity, for the purpose of augmenting its operations in
            terms of capitalization, investment, or employment, if at such time
            Tenant is in compliance with the terms and conditions of this Lease
            Agreement; provided, however, that all expenses related to or
            resulting from said relocation shall be Tenant's responsibility; or

      (b)   should Tenant be denied a tax exemption for the production of one or
            more eligible manufactured products under the Puerto Rico Industrial
            Incentives Act, after having applied for said exemption with the
            Office of Industrial Tax Exemption; provided that the right to
            termination for this cause may only be exercised within thirty (30)
            days from the date of notice of denial. No Tenant whose
            manufacturing process was determined to be non-eligible for a tax
            exemption prior to entering into this Lease Agreement is eligible to
            terminate the Lease under this section.

18.05 Landlord's Options. (a) Landlord may terminate this Lease Agreement upon
      Tenant's breach of any of its obligations hereunder, or upon occurrence of
      any of the events of termination set forth in Sections 18.01 and 18.02
      hereof. Said notice shall be given by certified mail with return receipt
      requested. The termination of this Lease shall become effective on the
      date indicated in said notice.

                                       27

<PAGE>

      (b)   Notwithstanding subsection (a), Landlord may always compel specific
            performance of the terms and conditions of this Lease Agreement and
            demand and protect its rights under this Lease Agreement through
            legal proceedings in law or equity to obtain the faithful
            performance of the covenants and obligations hereunder, including
            the payment of all amounts due under this Lease Agreement.

      (c)   Should any cause for termination arise, Landlord shall have
            available all the rights and remedies provided herein, which are
            separate and independent. Landlord's resort to any particular right
            and/or remedy will not deprive Landlord of any other right or remedy
            available at law or in equity.

      (d)   In the event Landlord terminates this Lease Agreement, Tenant's
            economic and environmental obligations and any other obligations of
            Tenant hereunder shall survive the termination and remain in effect
            until they are complied with to Landlord's satisfaction.

18.06 Damages. If Landlord elects to terminate this Lease Agreement in
      accordance with Section 18.05 hereof Tenant shall be responsible for
      payment of the following:

            (i)   all Rent due and unpaid up to the date of termination;

            (ii)  all losses, damages and costs incurred by Landlord as a
                  consequence of the early termination of this Lease Agreement
                  including, but not limited to expenses related to any notices
                  by Landlord to terminate this Lease Agreement; collection
                  costs; attorneys' fees during the termination process; and the
                  costs of court proceedings, if any; the costs to repair the
                  Leased Premises in order to restore them to the condition in
                  which Tenant would have been obligated to deliver the premises
                  bad an early termination not been effected; and expenses
                  incurred by Landlord to relet the Leased Premises in
                  accordance with Section 18.07 of this Lease Agreement; and

            (iii) damages equivalent to the total amount of Basic Rent
                  corresponding to the unexpired portion of the Term (i.e., the
                  Basic Rent for the period between the date of termination and
                  the expiration date of the Term in accordance with Sections
                  1.09 and 3.01), that Landlord would have received had the
                  Lease Agreement not been terminated.

18.07 Right to Relet. (a) At any time after Landlord recovers possession of the
      Leased Premises or any portion thereof, whether or not this Lease
      Agreement is terminated pursuant to Section 18.05, Landlord may, but is
      not obligated to, relet the Leased Premises or part thereof, in Tenant's
      name (as a sublease) or in Landlord's own name, as Landlord deems it
      convenient. The reletting of the Leased Premises, or part thereof, shall
      be for a term and under conditions as Landlord, in its own discretion,
      determines advisable; including that the term of any relet may be for a
      period longer or shorter than the remaining balance of the

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<PAGE>

      Term hereunder. Any relet may include special provisions, such as rent
      credits, a rent lower than that fixed under this Lease Agreement, or no
      rent. Tenant acknowledges that the damages formula under Section 18.06 is
      not subject to adjustments should Landlord elect not to relet the Leased
      Premises or because the Leased Premises or part thereof is leased to a
      third party at a rent lower than that of this Lease Agreement.

                                   ARTICLE XIX

                            RETURN OF LEASED PREMISES

19.01 Surrender of Possession. Upon termination of this Lease Agreement, at the
      expiration of the Term or otherwise, Tenant must vacate and surrender the
      Leased Premises to Landlord in good condition, reasonable wear and tear
      excepted, including all improvements, changes, or alterations made thereto
      with Landlord's consent and which Landlord does not require to be removed.

19.02 Holding Over. Should Tenant remain in possession of the Leased Premises
      after the expiration of the Term and does not execute a new lease
      agreement with Landlord. Landlord at its option may consider the tenancy
      of the Leased Premises to be on a month-to-month basis, with a Rent equal
      to one hundred fifty percent (150%) of the last Monthly Rent amount under
      the Lease Agreement, subject to all other terms and conditions of this
      Lease Agreement. consistent with a month-to-month term. Tenant shall
      indemnify Landlord for, and hold Landlord harmless from and against any
      damages, liabilities or expenses (including attorneys' fees) which result
      from Tenant's delay in surrendering the Leased Premises, including,
      without limitation, any claims made by succeeding tenants or third parties
      with Landlord bad committed the Leased Premises, or part thereof.
      Acceptance of Rent after termination of this Lease Agreement shall not
      constitute in itself a renewal or novation of this Lease Agreement None of
      the foregoing shall be deemed to constitute a waiver by Landlord of its
      right to recover the Leased Premises or any other right or remedy that
      Landlord may have under law, equity, or under this Lease Agreement.

19.03 Inspection of Leased Premises. Upon expiration of the Term or termination
      of this Lease Agreement and prior to Landlord's acceptance of possession,
      the Leased Premises shall be inspected by Landlord, who shall certify in
      an inspection report the physical and environmental condition of the
      Leased Premises. The inspection report shall identify any deficient
      physical or environmental condition(s) of the Leased Premises that must be
      corrected, remedied, or repaired at Tenant's cost as a condition precedent
      to Landlord's acceptance of possession .of the Leased Premises. Should
      Tenant fail take the corrective action required by the deficient condition
      of the Leased Premises as indicated in the inspection report within a
      reasonable time, Landlord may, but is not obligated to, perform the same,
      and Tenant shall reimburse Landlord for the cost of the corrective action.

19.04 Equipment, Machinery, and Furniture Not Removed. Any equipment, machinery.
      furniture or other property of Tenant remaining at the Lease Premises
      after termination of

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<PAGE>

      the Term or the termination of this Lease Agreement may be removed by
      Landlord and stored in another location, and Tenant will be responsible
      for the removal and storage costs. In no event shall Landlord be liable
      for the value, preservation, or care of said property. Any sum that
      Landlord must payor spend for removal and storage of the property shall be
      reimbursed by Tenant. Any equipment, machinery, furniture or other
      property not claimed within a term of thirty (30) days after the
      expiration or termination of this Lease Agreement, shall be deemed
      abandoned by Tenant. At Landlord's option, the property deemed abandoned
      by Tenant shall be transferred to Landlord without any other formality or
      document, and Landlord shall be entitled to freely dispose of the same
      without Tenant having any right or claim to any payment or consideration
      for said property.

19.05 Tenant's Liabilities. Neither the expiration or termination of this Lease
      Agreement, nor the repossession of the Leased Premises or part thereof,
      nor the reletting of the Leased Premises or any part thereof, pursuant to
      the provisions hereof, shall release the Tenant of its financial or other
      obligations under this Lease Agreement, which obligations shall survive
      the expiration or termination of this Lease Agreement, as well as
      repossession or reletting of the Leased Premises.

                                   ARTICLE XX

                               LEGAL REQUIREMENTS

20.01 Legal and Insurance Compliance. (a) Tenant, at its own cost and expense,
      shall observe and comply with (i) any requirement or condition under any
      federal, state or municipal law or regulation (including any executive
      order or municipal ordinance) applicable now or in the future to the
      Leased Premises, or to the use of the Leased Premises (including but not
      limited to any federal, state or local law, regulation or ordinance
      applicable to air and water quality, toxic or hazardous materials or
      substances. waste disposal. emissions or any other environmental matter);
      (ii) all requirements or conditions to obtain, maintain, and when
      appropriate, renew all permits and endorsements necessary to use the
      Leased Premises for the purposes allowed by this Lease Agreement and by
      the use permit issued by ARPE for the Leased Premises; (iii) the
      requirements of the insurance companies having issued policies .for the
      Leased Premises as provided by Article XV of this Lease Agreement; (iv)
      any real estate condition, lien or encumbrance affecting the Leased
      Premises; (v) all zoning and land use requirements; and (vi) any other
      requirement imposed by law that compels any duty or obligation with
      respect to the use or occupation of the Leased Premises.

      (b)   Tenant's compliance with any requirement described above shall be at
            Tenant's cost and expense, including, but not limited to. any other
            expense related to improvements or installations required by any
            agency or government instrumentality with jurisdiction, as a
            condition to the issuance or renewal of a permit or endorsement for
            the operations that Tenant is to carry out at the Leased Premises.

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<PAGE>

      (c)   Tenant, upon request of Landlord. shall submit evidence of its
            compliance with the above requirements or of the validity of permits
            and endorsements of the administrative agencies Tenant requires for
            its operations at the Lease Premises.

                                   ARTICLE XXI

                             ASSIGNMENT AND SUBLEASE

21.01 Assignment and Sublease. Tenant shall not (i) assign this Lease Agreement,
      sublet the Leased Premises or any part thereof, mortgage its leasehold
      right over the Leased Premises or otherwise place a lien upon its right or
      any interest in this Lease Agreement in favor of any person or entity;
      (ii) allow by operation of law the constitution of any lien over Tenant's
      leasehold right over the Leased Premises or the transfer of Tenant's
      leasehold right over the Leased Premises to a third party; (iii) allow the
      use or occupation of the Leased Premises, or part thereof, by any person
      or entity that is not Tenant, its agents or employees. Except as provided
      in Article XVII of this Lease Agreement, under no circumstances may this
      Lease Agreement be assigned in a voluntary or involuntary bankruptcy
      proceeding, and under no circumstances shall this Lease Agreement or the
      rights or privileges granted to Tenant herein constitute an asset of
      Tenant under a bankruptcy, insolvency or reorganization proceeding.

21.02 Change of Control. The transfer of Tenant's voting stock, a change of
      control in Tenant or change in the persons or entities having a direct or
      indirect interest in a tenant that is not a corporation (any of the
      foregoing hereinafter a "change of control"), shall be considered as an
      assignment for purposes of this Article XXI. Nevertheless, the above shall
      not apply to transfers of shares of voting stock traded in a nationally
      recognized stock exchange or reported through a national quotation system,
      provided that those shares transferred remain outstanding in said market
      or quotation system after the transfer. For purposes of this Section
      21.02, a change of control of a corporation shall be deemed to have
      occurred at any time and as frequently as the persons who hold the
      majority of voting stock of said corporation as of the date of this Lease
      Agreement, or who immediately after the date on which any change of
      control occurs, cease to be owners of the majority of said stock. be it in
      one or a series of transactions. The term "voting stock" means the stock
      of a corporation regularly having voting rights in the election of
      corporate directors. In the case of a partnership, a change of control
      shall be deemed to have occurred at any time that a change in any of the
      managing partners of said partnership occurs.

21.03 Permitted Assignments and Subleases. As an exception to the general rule
      established in Section 21.01 of this Lease Agreement, and subject to
      Landlord's prior consent, Tenant may assign its rights under this Lease
      Agreement, or sublease the Leased Premises or a part thereof, to any
      parent, affiliate, or subsidiary whose operations are compatible with
      those of Tenant. Landlord's consent to the assignment or sublease will
      require Tenant to be in full compliance with its obligations under this
      Lease Agreement, including the payment or Rent.

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<PAGE>

                                  ARTICLE XXII

                               GENERAL PROVISIONS

22.01 Signs and Advertisements. Tenant shall not install or permit to be
      installed or erected any poster, sign or structure of any kind on the roof
      or exterior walls of the Building or in any other part of the Leased
      Premises without previous written consent of Landlord.

21.02 Parking. Should the number of parking spaces available at the Leased
      Premises not satisfy Tenant's requirements, Landlord shall not be
      responsible for Tenant's parking requirements, and Tenant hereby releases
      Landlord of any duty or responsibility with respect to parking.

22.03 Attorneys' Fees. Tenant shall pay all of Landlord's charges and expenses,
      including court costs and attorneys' fees in any action (8) commenced by
      Landlord in order to obtain Tenant's compliance with any of its
      obligations and commitments under this Lease Agreement, or said charges
      and expenses incurred by Landlord in any action filed by Tenant in which
      Landlord prevails. Tenant shall pay all charges and expenses including
      court costs and attorneys' fees incurred by Landlord in any litigation,
      negotiation, or transaction in which Tenant requires Landlord's
      intervention or participation, where no fault or negligence is claimed
      against Landlord.

22.04 Successors and Assignees. This Lease Agreement shall bind and inure to the
      benefit of each of the parties, in their respective capacities as Landlord
      and Tenant, and their respective successors and assigns; provided,
      however, should title to the Leased Premises be transferred either
      voluntarily or by operation of law, the entity or natural person acquiring
      title shall take title free of all liability to perform this Lease
      Agreement, unless the entity or natural person expressly assumes and
      accepts the obligations as Landlord under this Lease Agreement by means of
      a written instrument in which the new titleholder and Tenant appear.

22.05 Landlord's Obligations to Lease. (a) The mere delivery to Tenant of an
      unsigned draft of this Lease Agreement for Tenant's review and
      consideration does not create in Tenant a right of option nor does it bind
      Landlord in any way to lease the Leased Premises to Tenant. Landlord's
      obligation to lease under this Lease Agreement shall not be binding until
      Landlord has executed same upon approval by Landlord's Board of Directors
      or Landlord's Executive Director, as the case may be.

      (b)   Tenant shall have thirty (30) days after receipt of the final lease
            agreement prepared for the Leased Premises to execute same. Should
            Tenant not execute and return the lease agreement to Landlord within
            thirty (30) days after receipt, Landlord shall have no obligation to
            lease, and any rights Tenant possessed in and to the Leased Premises
            shall be extinguished.

22.06 Definition of the Term "Tenant". The term "Tenant" as used in this Lease
      Agreement shall be construed as plural if there be more than one person or
      entity appearing and

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<PAGE>

      executing this Lease Agreement as Tenant. All changes and grammatical
      adjustments required to make the provisions of this Lease Agreement apply
      equally to corporations, partnerships or other entities, or individuals
      shall, in all instances, be construed as incorporated into the text of the
      document. Whenever Tenant consists of two or more persons or entities
      each shall be jointly and severally ("solidariamente") bound hereunder.

22.07 Headings. The headings of the articles and sections of this Lease
      Agreement are for convenience only and do not limit, expand, or define the
      contents of the articles and sections hereof.

22.08 Late Charges. (a) All payments that Tenant is obligated to make under this
      Lease Agreement, including without limitation, the Deposit, the Basic
      Rent, the Additional Rent, and any adjustment thereto, shall bear interest
      from its due date until payment in full, at a rate of one percent (1%)
      over the prime rate charged by the principal commercial banks in the city
      of New York as of the date the payment is due. Should the interest be held
      as usurious, then interest shall be deemed to have accrued at and continue
      to accrue at accrue the maximum rate of interest permissible, as
      established by the Interest Rate and Finance Charges Regulatory Board
      created by Act No. 1, of October 15, 1973, as amended (P.R. Laws Ann. Tit
      10, sec. 998), or any future law or regulation.

      (b)   Should Tenant fail to make a Rent payment within ten (10) days after
            its due date, then Tenant shall also pay to Landlord a penalty to
            recover Landlord, administrative expenses and collection costs equal
            to (i) one hundred dollars ($100.00) per day, or (ii) for each day
            the amount owed is past due, one half of one percent (0.05%) of the
            overdue amount, whichever is greater. Anything contained in this
            section regarding the payment of overdue amounts shall not
            constitute an extension of the due date of any amount Tenant is
            obligated to pay under this Lease Agreement, nor or shall it
            constitute a waiver of Tenant's obligation to pay such amounts as
            provided in this Lease Agreement.

22.09 Lease Guaranty. Simultaneously with the execution and delivery of this
      Lease Agreement, if required by Landlord, Tenant shall deliver the Lease
      Guaranty to Landlord duly executed by the Guarantor identified in Section
      1.15, if any, which Lease Guaranty shall be in form substantially similar
      to Attachment G hereto.

22.10 Performance. Whenever a requirement, obligation, or liability is imposed
      upon one of the parties hereto, the concerned party shall comply with or
      satisfy said requirement, obligation or liability at its own expense,
      unless specifically provided to the contrary.

22.11 Entire Agreement. This Lease Agreement, along with its attachments
      contains all the terms, conditions, agreements and covenants between the
      parties with respect. to the Leased Premises; it substitutes and
      nullities. any other lease agreement or other agreement, oral or written,
      between the parties regarding the occupation and use of the Leased
      Premises by Tenant, including any letter of agreement that governed the
      relationship between the parties prior to and during the negotiation of
      this Lease

                                       33

<PAGE>

      Agreement. This Lease Agreement shall only be modified, amended, altered,
      or canceled by a written document subscribed by both parties.

22.12 Force Majeure. In the event that Landlord shall be hindered or delayed in
      the performance of any of its obligations or commitments under this Lease
      Agreement by reason of force majeure, the performance of such act shall be
      excused for the period of time which it is reasonably understood that said
      act or event hinders its performance. Force majeure is understood as any
      incident or occurrence beyond Landlord's control, including, but not
      limited to, lock-outs, strikes, shut downs or labor disputes; inability to
      obtain necessary materials; riots, acts of war and insubordination; fires,
      explosions, accidents and acts of sabotage; lack of electricity or fuel;
      floods, earthquakes, torrential rains and hurricanes; administrative,
      governmental or court orders or injunctions; federal, state or municipal
      laws and regulations; the revocation, modification or suspension of a
      permit, license or other necessary authorization; matters of national
      security; acts or occurrences directly or indirectly caused by Tenant (its
      agents, employees, contractors, or invitees); or any other situation or
      event reasonably beyond Landlord's control. In said situation, the period
      of time for Landlord to comply with any obligation or commitment shall
      automatically be extended for a period equivalent to the period of
      duration of such force majeure.

22.13 Safety Programs. Tenant agrees to cooperate, assist and participate in any
      program Landlord develops or adopts to address any emergency or occurrence
      constituting force majeure.

22.14 Estoppel Certificate. Tenant, upon Landlord's request, shall provide
      Landlord with an Estoppel Certificate wherein Tenant certifies that (i)
      this Lease Agreement is unmodified and in full force and effect (or if any
      modifications, Tenant will specify such modifications and certify that
      this Lease Agreement as modified is in full force and effect); (ii) the
      date upon which Tenant began paying Basic Rent and the dates in which all
      Rent payments were made; (iii) that Landlord is not in default under any
      provision of this Lease Agreement; (iv) that the work by Landlord to the
      Leased Premises, was completed as agreed and that Tenant is in possession
      of the Leased Premises, (iv) Tenant has no claims against Landlord under
      this Lease Agreement, and (vi) that there is no petition, whether
      voluntary or otherwise, pending as to Tenant under the bankruptcy laws of
      the United States.

22.15 Tenant's Duties: Landlord's Rights. All obligations and agreements which
      Tenant is to perform or carry out under the tenus of this Lease Agreement,
      shall be done exclusively at Tenant's expense, and without a right to
      set-off or adjustment against Rent. Should Tenant breach or fail to
      perform any of the obligations under this Lease Agreement, and said
      default persists for more than ten (10) days from the delivery by hand or
      the U.S. Mail of Landlord's notice demanding performance thereof, Landlord
      shall be entitled, but shall not be obligated, to act as required to
      remedy said situation, without waiving or releasing Tenant from its
      liability with respect to said obligation. Any sum paid or expense
      incurred by Landlord in said efforts shall accrue interest pursuant to the
      provisions of Section 22.08 and must be paid by Tenant to Landlord upon
      demand.

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<PAGE>

22.16 Relationship Between the Parties. The relationship existing between the
      parties hereto is that Landlord and Tenant exclusively, and nothing
      provided for in this Lease Agreement shall be interpreted as creating a
      partnership, joint venture, principal and agent relationship or any other
      type of relationship between parties.

21.17 Nullity or Partial Invalidity. If any term, clause, section or article of
      this Lease Agreement, or the application or enforceability thereof, be
      declared null, invalid or unenforceable by a final order or judgment from
      a court having jurisdiction, the remainder of the Lease Agreement, or the
      application of said term, clause, section or article to persons or
      circumstances other than those against whom the nullity, invalidity or
      unenforceability was declared, shall not be affected by said order or
      judgment, and each term and condition in this Lease Agreement shall be
      valid and enforceable to the extent permitted by law and consistent with
      said order or judgement.

22.18 Accord and Satisfaction. No payment by Tenant, or the acceptance by
      Landlord of an amount less than the Rent herein stipulated shall be deemed
      to be other than a payment toward the stipulated Rent, nor shall any
      endorsement or statement on any check or any letter or other communication
      accompanying any check or payment as Rent be deemed an accord and
      satisfaction, and Landlord may accept such check or payment without
      prejudice to Landlord's right to recover the balance of such Rent or
      pursue any other remedy provided in this Lease Agreement or at law or
      equity.

22.19 Applicable Law. This Lease Agreement is executed, and its terms and
      conditions shall be construed and enforced, in accordance with the laws of
      the Commonwealth of Puerto Rico.

22.20 Jurisdiction and Competency. The parties agree that any action,
      proceeding, claim, counterclaim or any other kind of judicial. action that
      either of the parties initiates against the other regarding (i) any matter
      that arises out of or related to this Lease Agreement; (ii) the legal
      relationship existing between Landlord and Tenant; (iii) the use or
      occupation of the Leased premises by Tenant; (iv) any claim for damages;
      and/or (v) any statutory remedy, shall be filed and litigated before the
      Court of First Review of Puerto Rico.

22.21 Net Lease. Tenant recognizes and admits, without limiting the meaning of
      any other terms and conditions of this Lease Agreement, and as otherwise
      provided in this Lease Agreement, that the intentions of the parties in
      this Lease Agreement are that all Rent to be paid by Tenant to Landlord
      under this Lease Agreement, must be paid to Landlord, without deduction or
      setoff of any kind, and that any and all expenses incurred regarding the
      Leased Premises, or regarding Tenant's operations in the Leased Premises,
      including any assessments, taxes, municipal operating licenses, charges.
      special license and permit fees, insurance premiums, electricity, water,
      gas, telephone bills and other similar services, cost of repair,
      maintenance and operation of the Leased Premises or Property, together
      with all such fixtures that are placed on, attached to, installed or
      contained in the Leased Premises, shall be paid by Tenant.

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<PAGE>

22.22 Notices. All notices, claims or communications between the parties
      referred to or required by this Lease Agreement shall be in writing and
      sent by certified mail. return receipt requested, or personally delivered,
      to the addresses of the parties set forth in Sections 1.02 and 1.04 of
      this Lease Agreement. Any address change shall be notified to the other
      party in writing not less than thirty (30) days before the effective date
      of said change.

22.23 Non-Waiver. The failure of either party to demand strict performance of
      any of the provisions of this Lease Agreement upon default of any
      provision by the other party shall not constitute nor may it be construed
      as a waiver of said party's right to demand performance of any provision
      in the future if the default continues, or if the other party should later
      repeat the default with respect to the same provision. The receipt or
      acceptance by Landlord of the Rent or any other amount payable by Tenant
      under this Lease Agreement, with or without knowledge of Tenant's default
      on any obligation or condition under this Lease Agreement, shall not be
      deemed as release by Landlord in favor of Tenant from compliance with said
      obligation or condition, nor waiver of Landlord's rights or remedies under
      this Lease Agreement with regard to said default. The consent or approval
      given by Landlord for any act by Tenant which requires said consent or
      approval, is solely and exclusively limited to the act or event for which
      said consent or approval was given, and should not be understood as a
      waiver of any requirement for prior consent or approval for a similar act
      by Tenant in the future.

22.24 Cumulative Remedies. The rights and remedies of each of the parties in
      this Lease Agreement are independent, separate and cumulative. The
      exercise, or failure to exercise any right or remedy, shall not be
      interpreted or deemed to exclude or bar the exercise of any other right or
      remedy of either party under this Lease Agreement or under any law or
      regulation.

22.25 Brokers. Each party represents and warrants to the other party that it bas
      not engaged nor used the services of areal estate broker or agent in
      connection with this lease, and that no real estate agent has participated
      at any time in the negotiation of this Lease Agreement. Notwithstanding
      the foregoing, the liability for the payment of any commission or
      compensation claimed by any real estate professional who may have rendered
      services to any party with respect to this Lease Agreement shall be borne
      by the party that engaged said real estate professional, and furthermore
      said party shall indemnify the other against any damages, liability,
      expenses and/or attorney's fees, arising from any claim or lawsuit of any
      real estate professional for any commission allegedly owed for any service
      rendered.

22.26 Cross Default. Any default by Tenant under any other agreement with
      Landlord shall be considered a default under this Lease Agreement.

22.27 Representations. Tenant expressly represents that neither Landlord nor its
      directors, officers, agents, employees or representatives has made any
      representations or promises with respect to the Leased Premises, except as
      expressly provided in this Lease Agreement.

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<PAGE>

22.28 Financial Statements. Upon request of Landlord, Tenant must to submit to
      Landlord, within ninety (90) days after the expiration of Tenant's fiscal
      year, a certified financial statement issued by an authorized certified
      public accountant. The certified financial statement will include: (a)
      Tenant's capital; (b) Tenant's long-term debts and capitalization; (c)
      Tenant's investment in machinery and its ability to provide employment;
      (d) taxes paid by Tenant, including Social Security payments; and (e) any
      other information that is required by this Lease Agreement. Should Tenant
      fail to deliver the certified financial statement, Landlord shall obtain
      this information at Tenant's cost and Tenant shall permit Landlord access
      to Tenant's books and records at Tenant's main offices in Puerto Rico for
      this purpose.

22.29 Additional Documents. If Tenant is a corporation, Tenant agrees to submit
      to Landlord contemporaneously with the execution and delivery of this
      Lease Agreement (a) evidence of Tenant's registration with the State
      Department of the Commonwealth of Puerto Rico, including the name and
      address of its resident agent; and (b) a certificate of corporate
      resolution of Tenant's Board of Directors which authorizes or ratifies the
      execution of this Lease Agreement. If Tenant is a partnership, Tenant
      represents and warrants that this Lease Agreement has been subscribed by
      all managing partners or administrators representing Tenant. and that the
      same constitutes a valid and enforceable agreement for the partnership and
      each and every one of the partners, and also, that each and every one of
      Tenant's present and future partners are now and shall remain at all times
      jointly and severally liable under this Lease Agreement Tenant represents
      and warrants that the death, resignation or retirement of any partner
      shall not release said partner from its liability under the terms of this
      Lease Agreement without Landlord's consent in writing.

22.30 Fiscal Liabilities. (a) Tenant represents and warrants that, at the time
      of execution of this Lease Agreement (i) it has filed tax returns for the
      last five (5) years; (ii) that Tenant has no outstanding tax debt with the
      Government of Puerto Rico nor with the United States Government (if
      applicable) that is not subject to a payment plan which is current as of
      the date of execution of this Lease Agreement; (iii) and bas paid its
      unemployment taxes, disability and social security taxes (as applicable),
      or is in compliance with a payment plan therefor and in compliance with
      the terms and conditions thereof.

      (b)   Tenant expressly recognizes that the compliance with the provisions
            of this Section 22.30 is an essential condition of this Lease
            Agreement, and if any representation or warranty is not accurate, in
            whole or in part, the same shall constitute cause for Landlord to
            terminate this Lease Agreement.

22.31 Debt Certification. Tenant warrants to Landlord that neither Tenant nor
      its partners (or if Tenant is a corporation, its directors, officers or
      stockholders) owe any amount to Landlord or to any agency or
      instrumentality of the Government of Puerto Rico, either personally or
      under this or any other corporate or partnership name.

22.32 Non-Conflict Certification. Tenant represents and warrants to Landlord
      that there is no conflict of interest, neither actual or potential,
      between Landlord and any of Tenant's

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<PAGE>

      directors, officers, employees, partners and agents, as a result of
      business, labor, economic, or family relationships, or for any other
      reason. Tenant hereby covenants that upon Landlord's request Tenant shall
      deliver to Landlord a sworn statement from any of its directors, officers,
      employees, and/or agents that will confirm the veracity of Tenant's
      representation and warranty contained in this provision.

      IN WITNESS WHEREOF, the parties subscribe this Lease Agreement on the
dates below stated.

LANDLORD:                                   TENANT:

PUERTO RICO INDUSTRIAL                      LIFESTYLE FOOTWEAR INC.
DEVELOPMENT COMPANY

By: _________________________________       By: /s/ David Fraedrich
                                                -------------------
Name: _______________________________       Name: David Fraedrich
Title: ______________________________       Title: EVP and CFO
Date: _______________________________       Date: 12/16/99

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                                                                    ATTACHMENT A

                         DESCRIPTION OF LEASED PREMISES

DESCRIPTION OF BUILDING NO. T-1236-0-87
IN MOCA. PUERTO RICO

This is a pitched roof type building consisting of reinforced concrete
foundation, steel columns and girders and 30 feet long steel joists which in
turn support 22 gauge standard steel deck covered by one (1) fiberglass
insulation and a three (3) plies built-up roofing. Roof ventilators are
provided.

The building has a main floor 240'-6" x 180'-6" out to out dimensions with an
area of 43,410.25 sq. ft. of manufacturing space; two (2) lean to's provided for
sanitary facilities, one of 60'-6" x 12'-6" with an area of 756.25 sq. ft. and
the other of 60'-6" x 10'-6" for an area of 635.25 sq. ft. an entrance porch of
22'-0" x 8'-0" with an area of 176 sq. ft. This amounts to a total area of
covered floor space of 44,977.75 sq. ft.

The floor consists of a 4" thick reinforced concrete slab with monolithic cement
finish, floor slab is designed for a load capacity of 150 pounds p.s.f. Exterior
walls arc of concrete blocks plastered and painted on both sides. Interior walls
at lean to are plastered and painted. Ceiling is rubbed and painted throughout
the building. Windows are miami aluminum louvers throughout the building.
Interior doors are made of plywood, and exterior ones are industrial type metal
ones. Rolling doors at leading area arc provided. Clearance in the manufacturing
area from finish floor to lowest part of beams at the side's eaves is
12'-2-1/2".

DESCRIPTION OF LAND, LOTS NO. 2, 4 AND 6 (GROUPED). LOCATED AT MOCA INDUSTRIAL
AREA MOCAPUERTO RICO SITE OF PROJECT: T-1236-0-78

GENERAL:

Parcel or land, Lot. No. 2,4, and 6 (grouped), located at Moca West Industrial
Area ID Moca. PR.

It bounds: by the North, with State Road PR 125; by the South; with Lot No. 8 if
the same industrial area; by the East, with access street of the same industrial
area; and by the West, with land owned by Ana Sofia Esteves de Camara.

It has a surface of 17,878.83 square meters equivalent of 4.5489 cuerdas.

It is affected by the following rights of ways:
1)    A 5'-0" feet wide strip in favor of PREPA, running along the Northern
      boundary.
2)    A 25' -0" feet wide strip in favor of PREPA, running parallel to its
      Eastern boundary and at an approximate distance of 25 meter from it.

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CIVIL SPECIAL FACILITIES OF PROJECT T-1236-0-78 & Ext.

1. Security House

2. Lean-to structure 52T-0" x 63'-0" + 24"-0" x 52'-0" for cafeteria

3. Tool room

4. Warehouse structure

5. Electrical generator structure

6. Paved parking

7. Automatic sprinkler system

8. 200,000 gallons water tank for sprinkler system

9. Electrical substation and emergency power plant

10. Mezzanine at manufacturing area

ELECTRICAL SPECIAL FACILITIES OF PROJECT T-1236-0-78 & 1-78

1) Electrical line of 38 KV

DEFICIENCIES OF THE PREMISES:

Tenant hereby agrees to assume the following deficiencies of the former Tenant
of the Premises:

1) Above ground tanks for fuel storage

2) Compressor and suction pumps located outside the building

3) Full chemical containers storage outside the building

4) Electrical transformer

5) Floor vinyl tiles

6) Block wall structure

7) Concrete floor

8) Gypsum board walls

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