Document:

LEASE AGREEMENT

         THIS LEASE AGREEMENT between EDRO ASSOCIATES,  a New Jersey partnership
having its principal place of business at 300 Jacksonville  Road, P. 0. Box 117,
Pompton  Plains,  Morris  County,  New Jersey  07444,  as  Landlord;  and BALTEK
CORPORATION,  a New Jersey  Corporation having a place of business at 10 Fairway
Court, P.O. Box 195, Northvale, New Jersey 07647, as Tenant.

                                  WITNESSETH:

         The Landlord does hereby let unto the Tenant and the Tenant does hereby
hire from the  Landlord  the Premises  located at 108 Fairway  Court,  Northvale
Township,  Bergen County,  New Jersey (Tax Lot 13, Block 1101) containing 80,000
square  foot   office/warehouse/commercial   building   together  with  parking,
landscape and other site improvements.

         1. TERM

         1.1 The  initial  term of this lease shall be five and  one-half  (5.5)
months  beginning  on  September  15, 2000  ("Commencement  Date") and ending on
February 28, 2001. During this initial term, Tenant shall occupy only 54,400 sq.
ft.  of the  building  (See  attached  Exhibit  A) at $5.00 per  square  foot or
$22,666.67 per month, and Hasbro, Inc. will occupy the additional 25,600 sq. ft.
as  co-tenant.  All other  charges  (taxes/C.A.M./etc.)  shall be paid 66.75% by
Tenant Baltek and 33.25% by co-tenant Hasbro, Inc. during this five and one-half
month initial term.

         1.1.1 If Hasbro,  Inc. is not out of the  building  and delivery of the
entire  premises is not effected by March 1, 2001 or if  Landlord's  work is not
concluded  by that date,  rent and all other  charges for the  additional  space
shall be abated until those items are  completed  and rent for the initial space
shall be reduced by 50% for every day of delay.

         1.2 The main term of this lease  shall be nine (9) years  beginning  on
March 1, 2001 and  ending  at 11:59  p.m.  on  February  28,  2010  (subject  to
extension,  the "Termination  Date"),  during which term Tenant will then be the
sole  tenant  and will pay rent and other  charges  based on the  entire  80,000
square feet.

         The  Tenant  shall  have  the  right  to renew  the  lease  for two (2)
additional  five (5) year terms to commence at the  expiration  of the main term
provided the tenant has satisfied all of the following conditions:

                                      - 1 -

<PAGE>

                  1.2.1  Delivered  written  notice  to the  Landlord,  at least
twelve  (12)  months  prior to  expiration  of the main  term,  of its intent to
exercise such option,  by certified  mail return  receipt  requested and regular
mail at the  address  noted  hereinabove  or any  address  to which  Tenant  may
hereinafter be directed.

                  1.2.2 Tenant  shall not then be in default  under the terms of
this lease beyond applicable notice and cure periods as stated herein.

         1.3 At the  signing  of this  lease,  Tenant  shall  provide  proof  of
insurance, corporate resolution, post security and pay the first months rent.

         1.4 Unless otherwise  indicated herein, the premises shall be leased in
"as is" condition and the Tenant,  by the execution of this lease,  acknowledges
that it has inspected the premises and accepts them.

         2. USE

         2.1 The  premises  shall be used and  occupied  by the  Tenant  for the
following uses and purposes: offices,  warehouse,  assembly and manufacturing as
permitted  by local zoning  ordinance.  It shall be Tenant's  responsibility  to
obtain the necessary municipal approvals for occupancy.

         2.2 Quiet Enjoyment  Landlord covenants that Tenant, on paying the rent
and performing  its  obligations  under this lease,  shall and may peaceably and
quietly have, hold and enjoy the Premises for the term.

         3. RENTAL

         The Tenant shall pay to the Landlord  triple net rent,  which  payments
may be arranged by wire transfer from Tenant to Landlord, which shall be subject
to a five (5%) percent late charge if not received by the 5th of each month,  as
follows:

         3.1 Initial  Term.  Beginning  on the  Commencement  Date and ending on
February 28, 2001, during this initial term, Tenant shall occupy only 54,400 sq.
ft.  of the  building  (See  attached  Exhibit  A) at $5.00 per  square  foot or
$22,666.67  per month.  September 2000 rent and other charges shall be pro-rated
on a daily basis.

         3.2 Main Term.

                  3.2.1 Years 1 - 4. The sum of $5.00 per square foot  annually,
or $400,000.00 per year,  payable in equal monthly  installments each in the sum
of  $33,333.33,  hereinafter  referred to as base rent, on

                                      - 2 -

<PAGE>

the first day of each and every month in advance without notice.

                  3.2.2 Years 5 - 9. Base rent plus CPI increases.

         3.3 Renewal Term.

         The  Tenant  shall  have  the  right  to renew  the  lease  for two (2)
additional  five (5) year terms to commence at the  expiration  of the main term
provided the tenant has satisfied all of the following conditions:

                  3.3.1  Delivered  written  notice  to the  Landlord,  at least
twelve (12) months prior to expiration  of the main term or the first  extension
term,  as the case may be, of its intent to exercise  such option,  by certified
mail return receipt  requested and regular mail at the address noted hereinabove
or any address to which Tenant may hereinafter be directed.

                  3.3.2 Tenant  shall not then be in default  under the terms of
this lease beyond applicable notice and cure periods as stated herein.

         3.4  C.P.I.  Adjustment.  The base rent for  years 5-9 and the  renewal
option rent shall be subject to annual upwards (but not downwards)  readjustment
on the annual anniversary date of the lease, based upon the Consumer Price Index
(All urban consumers,  all items, New York Metropolitan Area, U.S. Department of
Labor,  Bureau of Labor Statistics  (based upon the differential in the index at
the inception of the main term or renewal term and the index then  prevailing on
the adjustment  date of the term).  The main term shall use March 1, 2001 as the
base year for all annual  increases.  Each renewal term shall use March 1 of the
first year of such term as the base year for  annual  increases  (i.e.  March 1,
2010 and March 1, 2015).

                  3.4.1  Rent  for  Renewal  Terms.  Tenant  shall  have two (2)
options,  exercisable  by notice  to  Landlord  at least 12 months  prior to the
expiration of the then  remaining  Term, to extend the Term for two (2) separate
periods  of five (5)  years  each  upon the same  terms  and  conditions  as are
contained  in this  Lease,  except that the base rent  payable  during the first
twelve  months of any  extension  period shall be equal to the Fair Market Rent,
subject to  increases  during each twelve  month  period  thereafter  during the
renewal term determined by adjusting the base rent based on the increases in the
CPI as of the beginning of each subsequent twelve month period.

     Fair Market  Rent.  If the parties  cannot agree upon the Fair Market Rent,
then the  Tenant

                                     - 3 -
<PAGE>

shall select an M.A.I.  appraiser familiar with commercial rentals in the Bergen
County, New Jersey area to establish a Fair Market Rent for the leased premises.
If  Landlord  does not agree with this  rent,  Landlord  shall  select an M.A.I.
appraiser familiar with commercial rentals in the Bergen County, New Jersey area
to  establish  a Fair Market  Rent for the leased  premises.  If Tenant does not
agree with this rent, then the Tenant's appraiser and Landlord's appraiser shall
select a third M.A.I.  appraiser  familiar with commercial rentals in the Bergen
County, New Jersey area to establish a Fair Market Rent for the leased premises,
which Fair Market Rent shall not be higher than the higher  appraisal  nor lower
than the lower  appraisal,  and which Fair Market  Rent shall be  binding.  Each
party will pay its own  appraiser and the cost of the third  appraiser  shall be
shared equally.

                  3.5  Additional  Rent.  Except  as noted  in Par.  1.1 for the
initial term,  for the main term and  thereafter,  in addition to the rent noted
herein, the Tenant shall be responsible for the payment of the following:

                           3.5.1    Real Estate Taxes;
                           3.5.2    Real Estate Assessments;
                           3.5.3    Water Rents;
                           3.5.4    Meter Charges;
                           3.5.5    Sewer Charges;
                                    3.5.5.1 All taxes,  sewer and water  charges
                                    and other charges  imposed against or levied
                                    upon the premises  shall be  apportioned  as
                                    between   Landlord   and   Tenant   at   the
                                    Commencement Date and the Termination Date.
                           3.5.6    Heating and utility charges including gas
                                    and electric;
                           3.5.7    Liability, fire and casualty insurance as
                                    hereinafter provided;
                           3.5.8    Repair  or  replacement  of minor  and major
                                    parts or  components  of heating,  plumbing;
                                    air  conditioning  and  electrical  systems;
                                    except  that if a major part or unit of HVAC
                                    equipment  requires  replacement  during the
                                    first   two   years    after   the   initial
                                    commencement   date,   Landlord   shall   be
                                    responsible. Tenant shall be responsible for
                                    repair  or  replacement  of  minor  parts or
                                    components for these two years;
                           3.5.9    Interior and exterior building and grounds
                                    maintenance;
                           3.5.10   Snow plowing and ice removal;
                           3.5.11   Lawn Maintenance;
                           3.5.12   Interior maintenance - decorating, cleaning
                                    and janitorial;
                           3.5.13   Sprinkler System Maintenance (cost of
                                    monitoring same).
                           3.5.14   Yearly Roof Maintenance.  Landlord shall
                                    replace the roof with a new roof prior to
                                    February 28, 2001 which roof shall include a
                                    fifteen (15) year warranty.

         3.6 If the  Tenant  fails  to pay any of the  items  noted  in 3.5 in a
timely  fashion,  Landlord  shall give  Tenant ten (10) days  notice in writing,
certified mail return receipt requested, and regular mail at the leased premises
of its  default.  If Tenant  fails to abate its default in any item within those
ten days, in addition to all other remedies  provided for herein or as permitted
by law,  Landlord  shall have the right to establish a monthly escrow

                                     - 4 -

<PAGE>

charge and to require  Tenant to pay, in addition to the rent noted in Par. 3, a
monthly sum to insure payment of those items noted in Par. 3.5.

     3.7 Permitted Contests. Tenant, at its expense, may contest, by appropriate
legal  proceedings  conducted  in good faith and with due  diligence,  any legal
requirement  with which  Tenant is required to comply  pursuant to this lease or
the amount or validity or application,  in whole or in part, of any tax or other
charge which Tenant is obligated to pay or any lien,  encumbrance  or charge not
permitted by this lease,  provided that (a) the commencement of such proceedings
shall suspend the enforcement of collection thereof against or from Landlord and
against or from the  premises,  (b) neither the premises nor any rent  therefrom
nor any part thereof or interest  therein  would be in any danger of being sold,
forfeited,  attached or lost, (c) Tenant shall have furnished such security,  if
any, as may be required in the proceedings and as may be reasonably  required by
Landlord,  and (d) if such contest be finally  resolved  against Tenant,  Tenant
shall  promptly pay the amount  required to be paid,  together with all interest
and  penalties   accrued  thereon.   Landlord  shall  complete  and  return  all
information  forms to taxing  authorities  on a timely  basis and,  at  Tenant's
expense,  shall  execute  and  deliver to Tenant  such  authorization  and other
documents  as  reasonably  may be required in any such  contest  and, so long as
Tenant has paid  Tenant's  share of taxes,  Landlord  shall  keep taxes  current
during such  proceedings.  Tenant shall  indemnify  and save  Landlord  harmless
against  any cost or expense of any kind that may be imposed  upon  Landlord  in
connection with any such contest and any loss resulting therefrom.  Tenant shall
not be in  default  hereunder  in  respect  to the  compliance  with  any  legal
requirement  with which Tenant is obligated to comply  pursuant to this lease or
in respect to the payment of any tax or other  charge  which Tenant is obligated
to pay or any lien,  encumbrance  or charge not  permitted  by this lease  which
Tenant is in good faith contesting.

         4. REPAIRS AND RENOVATIONS

         The Landlord shall be responsible for the renovations and other work as
set forth in Exhibit B, if any, prior to the commencement date.

                  4.1 Otherwise,  the Tenant,  on commencement of the main term,
shall take good care of the  premises,  and at its own cost and expense  conduct
all ordinary  maintenance and repairs and  replacements to the leased  premises.
The  costs of all  construction  for  Tenants  requirements  shall  be  Tenant's
exclusive  responsibility.

                                     - 5 -

<PAGE>

The Tenant shall advise  Landlord in writing of all work to be done.  The Tenant
agrees at the end or other  expiration  of this  lease to  deliver  the  demised
premises  in the  condition  in which  Tenant  is  required  to  maintain  same,
reasonable  wear and tear,  damage by fire and other  insurable  casualties  and
action by the elements excepted.

                  4.2 Landlord  shall have the right to demand that  Tenant,  at
its cost, restore the premises to the condition at the commencement of the lease
unless  otherwise  agreed to in writing at the  commencement of the renovations,
subject to reasonable wear and tear,  Landlord's work and Tenant's work approved
by  Landlord.  Landlord  approves  the  Tenant's  work  identified  in Exhibit C
attached hereto.

                  4.3 All  repairs,  renovations  shall  conform to all building
code   requirements   and  Tenant  shall  be   responsible   for  all  municipal
approvals/permits  and to insure that, where required,  Tenant's work is done by
persons holding appropriates licenses.

         5. SECURITY DEPOSIT

                  5.1 The Tenant  shall  deposit  with the  Landlord  the sum of
$66,666.66  or two (2)  months  rent as  security  for the  payment  of the rent
hereunder and the full and faithful  performance  by the Tenant of the covenants
and conditions on the part of the Tenant to be performed. Such security shall be
payable upon  execution of this  leasehold  agreement.  If Tenant  exercises the
renewal  option  as set forth in  Section  3.3  herein,  the  security  shall be
increased,  if the rent increases, to equal two (2) months of the increased base
rent. The security shall be refunded to the Tenant, without interest,  after the
expiration of the term hereof, but not later than 60 days following  termination
of the Lease,  provided that the Tenant has fully and  faithfully  performed all
such  covenants  and  conditions,  is not in arrears in rent,  or  otherwise  in
default/breach of the lease.

                  5.2 The Landlord may, if the Landlord so elects, have recourse
to such security,  for any purpose,  including  Landlord's use of such funds for
its own purposes  subject to its  obligation  to make  repayment  thereof to the
Tenant  pursuant to the terms of this lease.  The  Landlord  may also,  if it so
elects, have recourse to such security,  to make good any default by the Tenant,
then in such event the Tenant shall, on demand,  promptly  restore said security
to its original amount, which must be paid by the next rent due date.

                  5.3  Liability to repay said  security to the Tenant shall run
with the reversion and title to said  premises,  whether any change in ownership
thereof be voluntary  alienation or as the result of judicial sale,

                                     - 6 -

<PAGE>

foreclosure or other proceedings,  or the exercise of a right of taking or entry
by any  mortgagee.  The Landlord  shall assign or transfer said  security,  with
notice to the Tenant,  for the benefit of the Tenant, to any subsequent owner or
holder of the  reversion or title to said  premises,  in which case the assignee
shall  become  liable  for the  repayment  thereof as herein  provided,  and the
assignor  shall  thereby be released by the Tenant from all  liability to return
such security.  This provision shall be applicable to every alienation or change
in title and shall in no way be deemed to  permit  the  Landlord  to retain  the
security  after  termination  of the  Landlord's  ownership of the  reversion or
title.

                  5.4 The  Tenant  shall not  otherwise  mortgage,  encumber  or
assign said security.

         6. COMPLIANCE

         Tenant  represents  and warrants to Landlord that the demised  premises
shall be used,  occupied and maintained in full  compliance  with all New Jersey
and Federal environmental laws, present and future, including but not limited to
the New Jersey Spill  Compensation  and Control Act, the  Environmental  Cleanup
Responsibility  Act,  and all rules and  regulations  of NJDEPE and its  various
divisions. Notwithstanding any other provisions of this lease, Landlord shall be
and remain responsible for environmental conditions existing on the Commencement
Date  and  arising  thereafter  not due to the act or  omission  of this  Tenant
("Landlord's Environmental Obligations").

                  6.1 At the expiration of the term of this lease,  prior to the
return of any security,  the Tenant shall apply for and shall have received from
the  Bureau of  Industrial  Site  Evaluation  of the New  Jersey  Department  of
Environmental   Protection  ("NJDEP")  or  any  successors  thereto,   either  a
Non-Applicability  Letter or a Negative Declaration or an Administrative Consent
Order  ("ACO") or other  administrative  approval  with  respect to the  demised
premises,  for which Tenant  shall have  applied for pursuant to the  Industrial
Site  Recovery  Act  N.J.S.A.   13:1K-6  et  seq.  and  regulations  promulgated
thereunder ("ISRA") now or then in effect under this or successor legislation to
effectuate the terms of this provision.

                  6.2  Landlord  agrees  to  cooperate  in  the  filing  of  all
necessary  documents  required  to obtain  such  Letter  of Non-  Applicability,
Negative Declaration or ACO. The Landlord shall not be required to accept an ACO
in satisfaction of Tenants  responsibilities  under this subsection,  unless (i)
such ACO  permits  the  re-letting  of the  leased  premises;  (ii)  such ACO is
reasonably  acceptable to Landlord's mortgages (whether such mortgagee currently
holds a mortgage  against  the leased  premises or not) and (iii)  Tenant  shall
effectuate  cleanup  or

                                     - 7 -

<PAGE>

detoxification or, alternately,  at the option of the Landlord,  post a suitable
Performance  Bond  therefore.  Application  for a  Non-Applicability  Letter  or
Negative Declaration shall be made by Tenant, not less than six (6) months prior
to the  expiration of the term of this Lease and Tenant shall  furnish  Landlord
with true and  complete  copies of all  correspondence,  documents,  reports and
submissions  between  Tenant and ISRA and any successors  thereto.  Tenant shall
deliver such Non-Applicability  Letter,  Negative Declaration or ACO to Landlord
on the  expiration  date of this  Lease and in  default  thereof  the  following
consequences shall issue:

                  6.2.1 If Tenant's failure to comply with this section prevents
Landlord from re-renting the leased premises,  then Tenant shall be obligated to
continue to make monthly  payments in the sum equivalent to the monthly  payment
for the last month of the term,  until  delivery of a  NonApplicability  Letter,
Negative  Declaration,  ACO  or  other  written  determination  by  ISRA  or any
successors  thereto,  that  the  Tenant  and  the  demised  premises  are not in
violation  of the  Environmental  Cleanup  Responsibility  Act or any  successor
legislation enacted.

                  6.2.2 In the event  Tenant's  rental  obligation  continues in
accordance with sub paragraph  6.2.1 above,  the Tenant shall have the option of
remaining  in  possession  of the leased  premises  until the rental  obligation
expires or Tenant may, at its option, vacate the leased premises.

                  6.2.3  Rental  security  shall be  retained  by the  Landlord,
pending  Tenant's  compliance.  Landlord shall have the right during the term of
the Lease to inspect and undertake  sampling at the premises,  for which purpose
Tenant shall allow owner and owner's agent reasonable access.  Should Landlord's
sampling reveal that there has been a spill or discharge of hazardous substances
or wastes by the Tenant at the leased  premises  and  should  Tenant,  following
written  notice  first  given by the  Landlord,  fail to  correct  such spill or
discharge within a reasonable period of time, then Landlord shall have the right
to void this  agreement  on notice to Tenant but Tenant shall not be relieved of
costs  necessary  to make the  Landlord  whole.  Landlord's  use of the Tenant's
security to  remediate  shall not relieve the Tenant of  restoring  the security
during the term of the lease if Landlord does not exercise its right to void the
lease.

                  6.3 The  parties  shall,  with  respect  to  their  respective
environmental  obligations,  promptly  execute  and  comply  with all  statutes,
ordinances,  rules, orders,  regulations and requirements of the Federal,  State

                                     - 8 -

<PAGE>

and  Municipal  Governments  and of any and all their  Departments  and  Bureaus
applicable to, said premises,  for the  correction,  prevention and abatement of
nuisances,  violations  or other  grievances  in,  upon or  connected  with said
premises  during said term; and shall also promptly  comply with and execute all
rules,  orders and  regulations  of the New Jersey  Department of  Environmental
Protection Agency and the Board of Fire  Underwriters,  at the Tenant's own cost
and expense.

                  6.4 The  Tenant's  responsibility  above set forth shall apply
except insofar as said nuisances and violations or other  grievances or breaches
were or are included in Landlord's Environmental Obligations.

                  6.5 Tenant  presently  leases a portion of the leased premises
as a subtenant.  Tenant has no responsibility for environmental  problems except
those it  created  either as a  subtenant  or  during  this  lease  term and its
extension as a direct tenant.

                  6.6 Landlord's  Indemnity.  Landlord shall be fully and solely
responsible  for the  existence  and  remediation  of any  Regulated  Substances
affecting the premises as of the Commencement  Date and those arising during the
term  from  sources  outside  of the  premises,  unless  caused  by the  acts or
omissions  of  Tenant  or  those  acting  by  or  through  Tenant   ("Landlord's
Environmental Obligations"). Landlord hereby agrees to save, defend with counsel
reasonable  satisfactory  to Tenant,  indemnify and hold harmless Tenant and its
principals,  officers,  directors,  trustees,  agents  and  employees,  from and
against any and all claims, losses, liabilities, damages and expenses (including
reasonable  cleanup costs and attorneys fees arising under this indemnity) which
may arise  directly  or  indirectly  from any use or any  release  of  regulated
substances on or under the premises  resulting from Landlord's failure to comply
strictly  with  the  provisions  of this  section  with  respect  to  Landlord's
Environmental Obligations.

         7. FAILURE TO COMPLY

         In case the Tenant  shall fail or neglect to comply with the  aforesaid
statutes, ordinances, rules orders, regulations and requirements or any of them,
or in case the Tenant shall fail or neglect to make any necessary repairs, which
failure or neglect  continues  for a period of ten days after notice  thereof in
writing or in the event such repair cannot be reasonably accomplished within the
period set forth therein and any extension granted, and Tenant fails to commence
such repair within the period set forth  therein and any  extension  granted and
diligently

                                     - 9 -

<PAGE>

pursues same to completion,  then the Landlord or the Landlord's agent may enter
said  premises  and make said  repairs  and comply  with any and all of the said
statutes,  ordinances,  rules, orders, regulations or requirements,  at the cost
and expense of the Tenant;  and in case of the Tenant's  failure to pay therefor
the said cost and expense shall be added to the next month's rent and be due and
payable as such, of the Landlord may deduct the same from the balance of any sum
remaining in the Landlord's hands.

         8. ASSIGNMENT AND SUBLETTING

         The  Tenant  shall  not have the  right to  assign  this  agreement  or
under-let or underlease  the premises or any part  thereof,  without the written
consent of the Landlord,  which consent shall not be unreasonably  withheld. Any
assignment/sub-lease  shall include an  acknowledgment by the sub- tenant of its
acceptance  of the terms of this lease and shall not exceed the calendar term of
this lease.  Acceptance of a subtenant or assignee  shall not relieve the Tenant
of any obligation  hereinunder unless specifically stated in a writing signed by
the Landlord.  Tenant shall be  responsible  for any breach of this lease by its
assignees/subtenant unless relieved of this obligation in writing.

         9. INSPECTION OF PREMISES

         Tenant  agrees  that the  Landlord  and  Landlord's  agents,  and other
representatives  shall have the right to enter into and upon said  premises,  or
any part thereof,  at all reasonable hours,  provided Landlord  coordinates such
inspection with the Tenant, so as to not interfere with the Tenant's operations,
for the purpose of examining  the same,  or making such  repairs or  alterations
therein as may be necessary for the safety and preservation thereof.

         10. SHOWING PREMISES

         Tenant also agrees to permit the Landlord or  Landlord's  agent to show
the premises  during regular  business hours to persons  wishing to purchase the
same;  provided  Landlord  coordinates such inspection with the Tenant, so as to
not interfere with the Tenant's operations, and also to show the premises during
regular  business  hours to  persons  willing  to hire the same  after  Tenant's
failure to timely  exercise an option and the Tenant  further agrees that during
the six  months  next  prior to the  expiration  of the term,  the  Landlord  or
Landlord's  agent  shall  have the right to place  notices  on the front of said
premises,  or any part thereof,  offering the promises "To Let",  and the Tenant
hereby  agrees  to permit  the same.  to remain  thereon  without  hindrance  or
molestation.

         11. OBSTRUCTING SIDEWALKS

                                     - 10 -

<PAGE>

         The Tenant shall neither  encumber,  nor obstruct the sidewalk in front
of said  premises,  nor allow the same to be  obstructed  or  encumbered  in any
manner.

         12. SIGNS

         The  Tenant  shall not place or cause or allow any sign to be placed on
the roof of these premises  without the express written consent of the Landlord,
which  consent  shall  not be  unreasonably  withheld;  however,  any  municipal
approvals required for the sign shall be at Tenant's sole cost and expense.

         13. DAMAGE TO PERSONAL PROPERTY

         It is  expressly  agreed and  understood  by and between the parties to
this  agreement  that the  Landlord  shall not be held  liable for any damage or
injury to person or property  caused by or  resulting  from steam,  electricity,
gas, water, rain, ice or snow, or any leak or flow from or into any part of said
building, or from any damage or injury resulting or arising from any other cause
or happening whatsoever.

         14. SUBORDINATION

         This  instrument  shall  not be a lien  against  the said  premises  in
respect to any  mortgage or  mortgages  now on or that  hereafter  may be placed
against said premises and the recording of such mortgage or mortgages shall have
preference  and be superior and prior in lien to this lease,  regardless  of the
date of recording,  and the Tenant agrees to execute any instrument which may be
deemed necessary or desirable to further effect the  subordination of this lease
to any such mortgage or mortgages.

                  14.1  Should  the  Landlord  default  in  the  payment  of any
installment or installments due on any mortgage, or in any of the other terms of
such  mortgage or mortgages  which would permit the mortgage to  foreclose,  the
Tenant  shall  have the right to pay such sum or sums and  deduct  the same from
subsequent rents to be paid to the Landlord.

                  14.2 As a  condition  to the  occurrence  of the  Commencement
Date,  Landlord  will  arrange  with the holder of all  existing  mortgages  and
thereafter  with  any  future  mortgagee  for  an  agreement  that  foreclosure,
dispossess or other  forfeiture of title,  shall not result in a disturbance  of
the possession use or enjoyment of the leased premises by Tenant provided Tenant
is not in violation of the lease terms. Landlord will obtain the non-disturbance
agreement from the existing lender within sixty (60) days from the  commencement
date of the initial

                                     - 12 -

<PAGE>

term. Any  subordination  provision  contained in the lease,  relating either to
ground leases or mortgages,  is subject to the express  condition that if Tenant
is not in material  default under the Lease, (a) Tenant will not be made a party
in any action or  proceeding  brought by any person  having  rights  superior to
Tenant to recover possession of the premises or to foreclose any mortgage or for
any other relief south, and (b) Tenant's possession under the lease shall not be
disturbed.  Landlord  agrees to  deliver  to Tenant  letters  from any holder or
rights superior to Tenant, including mortgagees and ground lessors,  recognizing
Tenant's  rights  hereunder,  such  deliver to take place within sixty (60) days
following  the  commencement  date of the  initial  term of the lease.  Landlord
agrees to  indemnify  and save  harmless  Tenant from any and all damages  which
Tenant  may  sustain as a result of (i) any action to  foreclose  any  mortgages
encumbering  the real property and (ii) any  termination of the ground lease, if
any, resulting from Landlord's default thereunder.

                  14.3 At Tenant's request,  Landlord shall provide consents and
waivers of lien in favor of Tenant and Tenant's  lenders,  equipment vendors and
equipment  lessees with respect to the  equipment,  trade  fixtures and personal
property installed in or used at the premises.

         15. DEFAULT

         It is  expressly  understood  and  agreed,  except as herein  otherwise
provided, that in case the demised premises shall be deserted or vacated, and if
default  be made in the  payment  of the  rent or any  part  thereof  as  herein
specified  or, if,  without the consent of the  Landlord  the Tenant shall sell,
assign or mortgage this lease,  or if default be made in the  performance of any
of the covenants and agreements in this lease by Tenant,  or if the Tenant shall
file a petition in bankruptcy or  arrangement,  or be  adjudicated a bankrupt or
make an  assignment  for the  benefit of  creditors,  or take  advantage  of any
insolvency  act,  and if any  such  failure  or  default  continues  for 10 days
following  notice to Tenant if the  failure or default  relates to payment or 30
days  following  notice to Tenant for other defaults or failures  unless,  other
than payment, the obligation is the Tenant's under the Lease, then, the Landlord
may, if it so elects,  terminate this lease and any remaining term thereof, upon
giving  to the  Tenant  ten (10)  days'  notice  in  writing  of the  Landlord's
intention  so to do; and upon the giving of such  notice this lease and the term
thereof  shall  terminate,  expire  and come to an end on the date fixed in such
notice  as if said  date were the date  originally  fixed in this  lease for the
termination or expiration thereof

                                     - 12 -

<PAGE>

                  15.1 It is further  agreed that there shall be no  enforceable
default  against the Tenant or any  objection  to the  exercise of any option or
right  granted to the Landlord  under any provision of the lease in the event of
default or  omission by the Tenant,  unless  notice of such  default or omission
shall have been given to the Tenant by certified and regular  mail,  said notice
specifying  the default or  omission  complained  of; and the Tenant  shall have
twenty  (20) days after the  actual  receipt  of such  notice to comply  with or
remedy such default or omission of if such default or omission  shall be of such
a nature that the same cannot be  completely  remedied or corrected  within such
twenty-day  period,  Tenant shall advise  Landlord of same in writing and shall,
with  reasonable  diligence and in good faith,  proceed to correct or remove the
default complained of.

         16. NOTICES

         All  notices  required  to be  given  to the  Tenant  may be  given  by
certified and regular mail  addressed to the Tenant at 10 Fairways  Court,  P.O.
Box 195,  Northvale,  New Jersey  07647,  directed  to the  attention  of Ronald
Tassello, with a copy to Lowenstein Sandler PC, 65 Livingston Avenue,  Roseland,
New Jersey 07068, Attn: R. Barry Stiger,  Esquire, or to such other person, firm
or  corporation  or addresses as the Tenant may notify the Landlord by notice as
provided below.
         All  notices  required  to be  given  to the  Landlord  may be given by
certified  mail  addressed to the Landlord at 300  Jacksonville  Road, P. 0. Box
117, Pompton Plains, New Jersey, or to such other person, firm or corporation or
addresses as the Landlord may notify the Tenant in writing by notice as provided
above.
         17. STRICT PERFORMANCE

The failure of the  Landlord to insist  upon  strict  performance  of any of the
covenants  or  conditions  of this  lease,  or to  exercise  any  option  herein
conferred  in any one or more  instances,  shall not be construed as a waiver or
relinquishment for the future of ally such covenants, conditions or options, but
the same shall be and remain in full force and effect.

         18. LANDLORD'S RE-ENTRY

         In the event that the  relation of the  Landlord  and Tenant  ceases or
terminates  by  reason  of the  re-entry  of the  Landlord  under  the terms and
covenants  contained in this lease or by the  ejectment of the Tenant by summary
proceedings  or  otherwise,  or after the  abandonment  of the  premises  by the
Tenant, it is hereby agreed that the

                                     - 13 -

<PAGE>

Tenant  shall  remain  liable and shall pay in monthly  payments  the rent which
accrues  subsequent  to the reentry by the  Landlord,  and the Tenant  expressly
agrees to pay as damages for the breach of the covenants herein  contained,  the
difference  between the rent reserved and the rent  collected  and received,  if
any, by the Landlord during the remainder of the unexpired term, such difference
or deficiency  between the rent herein reserved and the rent collected,  if any,
shall  become due and payable in monthly  payments  during the  remainder of the
unexpired term, as the amounts of such difference or deficiency  shall from time
to time be  ascertained.  Notwithstanding  the foregoing,  Landlord shall make a
good faith effort to mitigate  Tenant's  damages,  by  attempting  to re-let the
leased premises.

         19. LIABILITY INSURANCE

                  19.1 The Tenant shall,  at its own cost and expense,  take out
and  maintain  in force at all times for the  benefit  of the  Landlord  and the
Tenant, in a solvent insurance company or companies authorized to do business in
the State of New  Jersey,  a present or future  standard  policy or  policies of
general  liability  insurance  as generally  issued,  covering all of the leased
premises in the amount of $2,000,000 in the event of a single  accident,  injury
or  disaster;  and in the  amount of  $4,000,000  in the event of any  accident,
injury or disaster to any number of persons arising out of one accident;  and in
an amount of $2,000,000  for damages or injury to property and provide  Landlord
with continuous  proof of same annually on the  anniversary  date of this lease.
Failure of the Tenant to obtain such  insurance  or to pay any and all  premiums
shall  constitute  a default  hereunder  for which the  Landlord  shall have all
remedies for defaults as in the case of failure to pay rent.

                  19.2 The  policy  shall  name the  Landlord  as an  additional
"insured" and shall contain an appropriate  provision  exculpating  the Landlord
from any liability of obligation to the Tenant and the insurance carrier.

                  19.3 The Tenant shall, at its own costs and expense,  take out
and maintain contents insurance.

         20. FIRE INSURANCE

         The Tenant shall, at its own cost and expense, take out and maintain in
force at all times for the benefit of the Landlord and the Tenant,  in a solvent
insurance  company  authorized  to do  business  in the State of New  Jersey,  a
present  or  future  standard  policy of fire  insurance  as  generally  issued,
covering all of the leased  premises

                                     - 14 -

<PAGE>

in the amount of  $4,000,000 in the event of a single  occurrence.  Tenant shall
insure  the  premises  including  Landlord's  loss of rent and  Additional  Rent
against  the perils  covered by standard  fire and  extended  coverage  all risk
policies,  including  burglary,  malicious  mischief and  vandalism,  sprinkler,
insurance,  boiler and pressure vessel and  miscellaneous  equipment  insurance,
including pressure pipes, air conditioning systems,  electric motors, air-tanks,
compressors  and pumps,  demolition and increased cost of  construction  in such
amount  as  Landlord  may  reasonably  require.  In the  event  that it shall be
impossible to obtain fire and extended  coverage  insurance on the buildings and
improvements  on the  premises,  in the form and with fire  insurance  companies
reasonably  acceptable  to  Landlord,  because of any reason due to or connected
with the  occupancy of the Tenant,  the Landlord may at its option,  at any time
thereafter terminate this Lease and the term thereof by giving the Tenant thirty
(30) days notice in writing of its intent to do so.

                  20.1 Tenant  shall  provide  Landlord  with proof of insurance
annually and notify Landlord of any claims made thereunder.

                  20.2  Waivers  of  Subrogation.   Each  party  agrees  to  use
reasonable  efforts to include in each of its policies  insuring  against  loss,
damage or destruction by fire or other insured  casualty  either (a) a waiver of
the  insurer's  right of  subrogation  against the other party (and,  in case of
Tenant's policies,  against any additional insured) or (b) should such waiver be
unobtainable (i) an express  agreement that such policy shall not be invalidated
if the insured  waives or has waived  before the  casualty the right of recovery
against any party  responsible for a covered  casualty or (ii) any other form of
permission from the insurer for the release of such  responsible  party. If such
waiver,  agreement or  permission  shall not be  obtainable  without  additional
charge or at all, the insured party shall so notify the other party promptly. If
such waiver,  agreement or permission shall be obtainable at additional  charge,
then the insured party agrees to pay such charge.

         21. FIRE LOSS

                  21.1 If the leased  building or premises is partially  damaged
by fire or other insured risk and such damage can be repaired within  forty-five
(45) days after the date of such fire,  then (1) this lease shall remain in full
force  and  effect;  (2) the  Landlord  shall  promptly  repair  such  damage at
Landlord's expense; and (3) there shall be a proportionate abatement of rent for
so much of the leased premises as may be untenantable  during the

                                      - 15 -

<PAGE>

period of such repair.

                  21.2 If the leased  building or premises is  destroyed by fire
or other casualty to such extent as to make it substantially  untenantable  (25%
or more of the leased premises), and if the Landlord within forty-five (45) days
after such occurrence (1) shall decide not to rebuild,  or (2) shall not rebuild
(with the same facilities and appurtenances existing before such occurrence) and
(3) if Tenant does not elect to rebuild  (utilizing the insurance proceeds to do
so) and continue the payment of rent without  abatement  during such rebuilding;
then this lease  shall  terminate  at the option of the  Landlord or Tenant upon
written  notice given by either party to the other party within ninety (90) days
after  such  casualty.  Upon the  expiration  of  twenty  (20) days  after  such
termination (1) the Tenant shall surrender said premises and all of the Tenant's
interest therein to the Landlord; (2) there shall be a proportionate adjustment,
refund and abatement of rent computed as at and to the date of such  occurrence;
(3) there  shall be a refund of any rent paid in  advance as at the time of such
occurrence;  and (4) the Landlord may re-enter and  repossess  the premises thus
discharged from this lease and remove all parties therefrom.

                  21.3 Tenant shall  immediately  notify the Landlord in case of
fire or other damage to the premises.

         22. MECHANIC'S LIENS

         In the event the Tenant  shall do any acts or make any  contract  which
may create or be the  foundation  for any lien upon the premises or other estate
or reversion of the Landlord in the premises herein demised or upon the building
or improvements  thereon, or should any such lien be filed by reason of any such
acts or contracts made by the Tenant, then the Tenant shall post a bond insuring
the  discharge  of same or otherwise  discharge  the same within sixty (60) days
after written notice and demand therefor on the part of the Landlord.

         23. EMINENT DOMAIN:

                  23.1 If the land and premises  leased herein,  or of which the
leased  premises are a part,  or any portion  thereof which  materially  affects
Tenant's  use  of  the  premises,   shall  be  taken  under  eminent  domain  or
condemnation proceedings, or if suit or other action shall be instituted for the
taking  or  condemnation  thereof,  or if in  lieu  of any  formal  condemnation
proceedings  or actions but under threat  thereof,  the Landlord  shall grant an
option to purchase and or shall sell and convey the said premises or any portion
thereof,  to the governmental or

                                     - 16 -

<PAGE>

other public  authority,  agency,  body or public utility,  seeking to take said
land and premises or any portion thereof which  materially  affects Tenant's use
of the premises, then this Lease shall terminate,  and the term hereof shall end
as of such date as the terminating party shall fix by notice in writing; and the
Tenant  shall have no claim or right or be entitled to any portion of any amount
which may be  awarded  as  damages  or paid as the  result of such  condemnation
proceedings or paid as the purchase price for such option, sale or conveyance in
lieu of  formal  condemnation  proceedings;  and all  rights  of the  Tenant  to
damages, if any, are hereby assigned to the Landlord.

The Tenant agrees to execute and deliver any instruments,  at the expense of the
Landlord,  as may be deemed  necessary or required to expedite any  condemnation
proceedings or to effectuate a proper transfer of title to such  governmental or
other public  authority,  agency,  body or public  utilities  seeking to take or
acquire the said lands and premises or any portion thereof. The Tenant covenants
and agrees to vacate the said  premises,  remove  all of the  Tenant's  personal
property  therefrom and deliver up peaceable  possession thereof to the Landlord
or to such other party designated by the Landlord in the aforementioned  notice.
Failure by the Tenant to comply with any provisions in this clause shall subject
the Tenant to such costs, expenses, damages and losses as the Landlord may incur
by reason of the Tenant's breach hereof.

                  23.2 Nothing  stated in Par.  23.1 shall be construed to limit
the  Tenant's  right  to  relocation  costs  or  recovery  for the  costs of its
equipment,  trade fixtures and other  installations,  as otherwise  permitted by
law.
                  23.3 If a  condemnation  or taking  shall  make  access to the
premises or Tenant's use of the premises unfeasible for Tenant's operations then
Tenant  shall  have the  right to  terminate  this  Lease.  If the  Lease is not
terminated by either Landlord or Tenant as permitted under this Article 23, then
after  any  taking  or a  part  of the  premises,  the  rent  shall  be  reduced
proportionately.

         24. QUIET ENJOYMENT

         The Landlord does covenant that the said Tenant on paying the said rent
and  performing  the  covenants  aforesaid,  shall and may peaceably and quietly
have, hold and enjoy the said demised premises for the term aforesaid.

         25. BINDING

         The covenants and agreements  contained in this entire instrument shall
inure to the  benefit  of and be  binding

                                     - 17 -

<PAGE>

upon the  parties  hereto  and  their  respective  assigns,  heirs,  successors,
executors and administrators.

         26. PLACE OF PAYMENT

         All  payments  required  to be made by the  Tenant to the  Landlord  in
pursuance  of any of the  provisions  of this lease may be made by the Tenant in
cash or by certified  check, or by Tenant's  regular  business account check, by
mailing same to the Landlord at 300  Jacksonville  Road, P. 0. Box 117,  Pompton
Plains,  New Jersey,  or to such other address or to such other person,  firm or
corporation  as the  Landlord  may  direct  by giving  notice  to the  Tenant in
writing.

                  26.1 If any of the  Tenant's  checks  are  dishonored  for any
reason, all future payments shall be by certified check.

         27. AUTHORITY TO EXECUTE

         If any party to this Lease is a corporation, the parties executing this
Lease on behalf of the  corporation  represent  that they have been  granted the
authority  to  execute  this  Lease by the  corporation,  by a  validly  adopted
Corporate Resolution. In the event any party to this Lease is a Partnership, the
parties  executing this Lease on behalf of the  Partnership  represent that they
are authorized by the Partnership Agreement to bind the Partnership to the terms
of this Lease Agreement.

         28. ISSUANCE OF CERTIFICATE OF OCCUPANCY - CONTINGENCY

         Landlord and Tenant shall work promptly to obtain all permits necessary
for occupancy but it shall be the Tenant's  responsibility  to apply for same at
its  cost.  Failure  to do so  shall  not  relieve  the  Tenant  of  any  rental
obligations.

         29.  REALTOR'S  COMMISSION.  The parties  represent that no Real Estate
Broker has been  involved in this  transaction  and that the party that violates
this  representation  shall  be  responsible  for  payment  of any  real  estate
commission that lawfully becomes due and payable.

         30. ESTOPPEL CERTIFICATES.

                  30.1  Tenant,  upon  twenty  (20)  days  prior  request,  will
execute,  acknowledge  and  deliver  to  Landlord  a  statement  executed  by an
appropriate  officer of Tenant,  certifying that this lease is unmodified and in
full force and effect (or, if there have been modifications,  that this lease is
in full force and effect as modified and

                                     - 18 -

<PAGE>

setting  forth  such  modifications)  and the  dates  to which  the  base  rent,
additional  rent and other sums payable  hereunder  have been paid,  and stating
that to the knowledge of the signatory to such  certificate  no default of which
the signatory may have knowledge shall have occurred (or, if Landlord's  default
shall have  occurred and be  continuing,  stating the nature of such  Landlord's
default).  Such statement by Tenant may be relied upon by any mortgage holder or
by prospective purchaser of the premises.

                  30.2  Landlord,  upon  twenty  (20) days prior  request,  will
execute,   acknowledge  and  deliver  to  Tenant  a  statement  executed  by  an
appropriate officer of Landlord, certifying that this lease is unmodified and in
full force and effect (or, if there have been modifications,  that this lease is
in full force and effect as modified and setting forth such  modifications)  and
the  dates to which  the base  rent,  additional  rent and  other  sums  payable
hereunder  have been paid, and stating that to the knowledge of the signatory to
such certificate, which knowledge may be limited to the financial aspects of the
lease,  no default of which the signatory may have knowledge shall have occurred
(or, if Tenant's  default  shall have  occurred and be  continuing,  stating the
nature of such Tenant's default).  Such statement by Landlord may be relied upon
by  any  mortgage  holder  or by  prospective  assignees  or  subtenants  of the
premises.

         31. RIGHT OF FIRST REFUSAL.

                  31.1 Right of First  Refusal.  During  the term,  as it may be
extended  hereunder,  Tenant shall have a right of first refusal to purchase the
premises  on the  following  terms  and  conditions.  If  Landlord  receives  an
acceptable offer ("Offer") to purchase the premises, which Offer shall be in the
form of a fully  executed,  contingent  contract,  then Landlord shall provide a
copy of the Offer to Tenant,  which  shall have 15 days to elect to enter into a
contract on the same terms and conditions  described in the Offer, TIME BEING OF
THE ESSENCE FOR  TENANT'S  ELECTION.  If Tenant  fails to exercise  its right of
first refusal hereunder and Landlord shall fail to close an actual sale with the
prospect  in  substantial  conformity  with the  Offer  within  180  days  after
providing Tenant with a copy thereof,  then Tenant's rights with respect to such
prospect's Offer shall be reinstated.

                  31.2  Estate  Planning  Exceptions.  Tenant's  right  of first
refusal  under section 31.1 shall apply to the sale of  controlling  interest in
Landlord, but shall not apply to transfers, whether voluntary or by

                                     - 19 -

<PAGE>

operation of law, by will, trust, bequest or otherwise,  between partners of the
Landlords or from such partners to members of their immediate families (for this
purpose  meaning the spouse and  children  of Robert E.  Fazekas  and/or  Edward
Jaffy),  or trusts,  partnerships  or other  entities for their benefit or which
they control, but shall apply to any transfer thereafter.

         32.  Landlord  represents and warrants that (a) the property is in full
compliance with applicable laws, (b) contains no underground  storage tanks, (c)
is not the subject of any  environmental  remediation or  investigation,  (d) is
otherwise  in  compliance  with  all  environmental  laws,  including  ISRA,  in
connection with their  activities and termination of operations at the property.
Landlord will obtain from Hasbro,  Inc. all DEP clearances prior to its vacating
the premises on February 28, 2001 and provide Tenant with a copy of same.

                  IN WITNESS WHEREOF, the parties have set their hands and seals
or caused  these  presents to be signed by their proper  corporate  officers and
caused their proper corporate seals to be hereunto affixed, this
18TH   day of September, 2000.

Signed, Sealed and Delivered

ATTEST:                                              BALTEK CORPORATION

 /s/ Harold Gutman                          BY  /s/ Ronald Tassello
--------------------------------               ---------------------------------
                                               RONALD TASSELLO,

WITNESS:                                       EDRO ASSOCIATES

 /s/ Neleda Caraballo                      BY   /s/ Robert E. Fazekas
--------------------------------               ---------------------------------
                                               ROBERT E. FAZEKAS, Partner

                                     - 20 -

<PAGE>

                                   EXHIBIT A

                 [PLAYSKOOL BABY PLANT FLOOR PLAN APPEARS HERE]

<PAGE>

                                   EXHIBIT B

                                                                     1 OF 3
August 17, 2000

Dear Bob,

This memo will confirm our  discussion  of 8/16 and 8/17 at which time we agreed
to the following:  I made the changes to the original memo sent to you on August
4th so you  would  not have to refer to two  memo's.  Anything  new added to the
original has been underlined

Section 10 (Alterations) in the agreement,  states the following, "all additions
and  improvements  made by the  Tenant  shall  belong  to the  Landlord,  unless
otherwise agreed in writing."

I  mention  the above  section  because  many of the items you have  asked us to
remove  would fall under that section and we do not want to be  responsible  for
removing anything that belongs to you.

The items that fall into this category are as follows.
1    The three cinder block rooms,  including  the lighting that goes with them.
     We agree to remove the sample room only,  including  the lighting that goes
     with it. It amounts to removing 2 cinder block walls.
2.   Any permanent  office that was erected,  including the ones you asked us to
     take down. You agreed.
3.   Any wiring, conduit, or distribution panels. We will remove the wiring form
     the production equipment to the distribution panels.

As for the landscape around the stream. Our environmental  person Kevin England,
has deemed  this as  wetland.  He feels if he goes to the agency who  determines
this, they  will rule it that way. What we are  willing  to do is have you get a
quote to cut the brush back. If the quote is reasonable we will allow you to get
it done. You, as the owner of the building,  will have to accept  responsibility
if any government  agency challenges the work. We will pay you when you issue us
a bill and a copy of your contractors  invoice.  We will clean any obvious trash
that was dumped into the stream, if any, prior to vacating the premise.  You can
have DePaola do this job. Is included in their quote for $2.385. See 1 below.

The following list contains the Items we will take care of:

1    Cut  back the  trees at the  comer  of the  building  so that  they are not
     touching the building. Part of DePaola job. $2.385 total job.
2    Remove the posts and chain in the front of the building. Done
3    Repair or replace missing or damaged curb at the back of the building only.
     Any other damaged curb is considered normal wear and tear over the 21 years
     we occupied the building.  We will pay you $6.000 toward all curb repair or
     replacement.
4    Remove the Hasbro/Playskool signs on the outside of the building and patch
     any holes make in the structure of the building. Done
5    Re-paint or replace all parking sings on the outside of the building. Ok
6    Repair the cracks in the parking lot. Ok
7    We will have a general  contractor  replace the  caulking on the windows in
     the front of the  building,  repair  cracks in walls near the  dumpster and
     repair cracks in the walls near the docks caused by trucks backing in. They
     will not repair stress cracks. Ok
8    Repair the last canopy,  number 6 in our  drawing.  Also repair the tear in
     the side of the canopy identified during our walk through. Done
9    Make sure all exterior lighting is in working condition. Ok
10   Replace the bumpers at the docks. Ok

<PAGE>

                                                                     2 OF 3

11   Remove the frailer in back of the building and repair the  indentations  it
     made in the lot. Ok
12   Remove the 3 large and 1 small condensers from the back of the building and
     patch the holes made in the structure of the building. Will also remove the
     interior  units,  wiring and  plumbing.  Shah is using one of the units and
     wants to keep it in until he moves  out.  At that time he will  remove  the
     last unit
13   Remove all wad signs and  pictures on the inside of the  building and patch
     holes. Ok
14   Remove all loose wires that the landlord identifies for us to remove. These
     are  wires  that are not  connected  to  anything.  (Providing  we put them
     there.) Ok
15   Repair the floor where a wiring pipe was sticking out, as identified during
     our walk through. Ok
16   Repair the sheet rock around the columns in the building. Done
17   Remove the  portable in plant  office and patch any holes  made.  One done.
     Will use the second  one for his tool room and remove it upon  termination.
     Cannot locate the third unit.
18   Replace all non-functional bulbs and or ballast's inside building.  Ok. Add
     offices, bathroom and bathroom exhaust fans.
19   Make sure all emergency exit lights and signs are repaired. Ok
20   Work with ADT to terminate our contract and turn it over to Baltek. Ok
21   Have Wells Fargo remove their system. Done
22   Replace all stained ceiling tiles. Ok
23   Repair the sliding door at the closet as described during our walk through.
     Dope
24   Service  the 6 roof top HVAC  units.  (Tri  County has quoted this job at a
     total cost of S994.00. They can do the lob.) You will have TC do the job.
25   Service the conference  room air  conditioner.  (Tri County has quoted this
     job at a total cost of  $616.00.  They can do the job.) You will have TC do
     the Job.
26   Repair heating and cooling unit on the second floor. (Tri County has quoted
     this job at a total cost of $474.00. They can do the job.) You will have TC
     do the Job
27   Repair the computer room air  conditioner  system.  You will have TC do the
     job for a total cost of $1144.26.
28   Service 6  warehouse  heater  units.  (Tri  County has quoted this job at a
     total cost of $698.00 They can do the job.) You will have TC do the job.
29   Repair the thermostat at the loading dock.  (Tri County has quoted this job
     and 30 below for a total  cost of  $521.00.  They can do the job.) You will
     have TC do the Job.
30   Service the tubular infra heaters at the loading docks. You will have TC do
     the job

We feel all of these item can be done prior to August 31, 2000. Certainly all of
the items on the  inside of the  building,  which  will allow your new tenant to
move in on September 1st.

We do not intend to replace  anything  identified  as being  replaced in the Tri
County AC Company proposal dated 6/2/00.  These items are beyond repair and have
outlived their usefulness over the 21 years we occupied the building.

Note 1.: You will have Tri County  quote  repairing  the above  items.  You will
submit the quote to us for approval It is my understanding  that Baltek wants to
keep  the  Modular  furniture  in  place.  At  termination  we will  remove  all
equipment, including exhaust stacks and repair all penetrations.

Best Regards.

Bill Esposito

Your items A thru J

     A.   4 Warehouse unit heaters. See note 1 above.
     B.   2 Loading Dock heaters. See note 1 above.

<PAGE>

                                                                     3 OF 3

     C.   1 heater in Compressor room and 1 in SS room. See note 1 above
     D.   Re-stripe parking lot. We will pay you $400 toward re-striping.
     E.   Paint exterior doors and railing. Will not do.
     F.   Shampoo rugs and paint. Will not do.
     G.   Clean and check  louvers,  ceiling fans and exhaust fans in warehouse.
          OK
     H.   Repair sprinkler blow out conduits. Ok
     I.   Replace hot water heater. Ok
     J.   Replace concrete curbing. See 3 above.
     K    Total property clean UP. See 1 above.
     L.   Will not do.

I think that covers everything Bob

Best Regards.

/s/ Bill

Bill

<PAGE>

                                    Exhibit C

                                  Tenant's Work

     1.   Widening loading dock door from 9' wide to 10' wide.

     2.   Widening door from loading area to warehouse from 8' to 10'

     3.   Put in a drive in overhead door in warehouseAMENDMENT TO LEASE

                This Amendment to Lease ("Amendment") dated , August 17, 2000 by
and between  Northvale 1997 Associates,  L.L.C., a New Jersey limited  liability
company,  with its address at 235 Moore  Street,  Hackensack,  New Jersey  07601
("Landlord") and Baltek Corporation, a Delaware corporation,  having its offices
at 10 Fairway Court, Northvale, New Jersey 07647 ("Tenant").

                                R E C I T A L S:

               A.  Landlord's  predecessors  and Tenant and/or its  predecessors
have  executed  and  delivered a certain  Lease  dated June 11, 1969  ("Original
Lease"),  as  amended  by a Lease  Amendment  dated  February  13,  1974  and an
Amendment  to Lease  dated May 20,  1992  (together  "Amendments")  for  certain
Demised Premises located at, and commonly known as, 10 Fairway Court, Northvale,
Bergen County,  New Jersey.  The Original  Lease and Amendments are  hereinafter
together referred to as "Lease".

               B.  Landlord  and  Tenant  desire  to amend  the  Lease to modify
certain provisions.

               Now, therefore,  in consideration of the mutual agreements herein
contained  and other good and  valuable  consideration,  the receipt of which is
hereby acknowledged, it is mutually agreed as follows:

               1. The Recitals set forth above are hereby incorporated into this
Amendment with the same force and effect as if they had been set forth herein at
length.  The words and  phrases  as  defined  in the Lease  shall  have the same
meaning in this Amendment.

               2.  Paragraph  2 of the  Original  Lease,  captioned  "Term",  as
previously  amended in the  Amendments  are hereby deleted in their entirety and
the following is inserted in its place and stead:

                        "The Lease  commenced on January 1, 1970  ("Commencement
                   Date"),  and the term of the Lease is hereby  extended  until
                   February  28, 2010  ("Termination  Date"),  on which date the
                   Lease shall terminate unless otherwise extended."

               3.  A new Paragraph 2.3 is hereby added to the Lease as follows:

                        "2.3  Upon  expiration  of the term of the  Lease as set
                   forth in Paragraph 2 (February 28,  2010),  Tenant shall have
                   the right and  option to extend the term of the Lease for one
                   period of five (5) years  ending on February  28,  2015.  The
                   right and  option to  extend  the term of the Lease  shall be
                   subject  to  and  contingent  upon  each  and  every  of  the
                   conditions set forth  hereinafter.  Tenant's right and option
                   to  extend  the term of the  Lease  shall be  exercisable  by
                   Tenant giving written notice of the exercise of the right and
                   option to Landlord before November 30, 2008. In the event

<PAGE>

                   Tenant  fails to give  written  notice  of its  intention  to
                   exercise  its right  and  option  as  provided  above and its
                   notice of  acceptance  of the rent  within  the  stated  time
                   periods,  Tenant's right and option to extend the term of the
                   Lease shall  (upon the date by which  written  notice  should
                   have been received by Landlord) be deemed to have been waived
                   by Tenant and shall be of no further force or effect.  In the
                   event  Tenant  exercises  its right and option in  accordance
                   with the  provisions  hereof  the term of the Lease  shall be
                   extended  accordingly,  and all  references  contained in the
                   Lease to the Termination  Date shall be construed to refer to
                   February 28, 2015. Unless otherwise expressly provided to the
                   contrary,  the  extended  term of the Lease shall be upon the
                   same  terms,  conditions  and  covenants  as set forth in the
                   Lease  except that there shall be no further  right or option
                   to extend the term of the Lease.  It is important to Landlord
                   that it know  whether or not the  options  are  exercised  by
                   Tenant so that it may seek a replacement tenant to avoid loss
                   of rent, and, therefore, the time within which the option and
                   acceptance  of the rent must be  exercised  is hereby made of
                   the  essence.  The right and option to extend the term of the
                   Lease shall be subject to and contingent  upon each and every
                   one of the following conditions:

                        (i) The Lease is in full force and effect;

                        (ii) Tenant shall not be in material  default  under any
                   of the terms,  provisions,  covenants  and  conditions of the
                   Lease; and

                        (iii) In lieu of the sums set forth in  Article 2 of the
                   Lease,  the monthly  installments  of base rent to be paid by
                   Tenant  monthly during the option period shall be the greater
                   of fair market rent or $37,380.44,  but in no event shall the
                   monthly rental be less than $37,380.44,  notwithstanding that
                   fair market rent shall be lower.  Rent shall be determined as
                   follows:

                        Within twenty (20) days after Landlord receives Tenant's
                   notice,  Landlord  shall  submit to Tenant,  in writing,  its
                   determination of fair market rent. Within ten (10) days after
                   Tenant  receives the fair market rental figure,  Tenant shall
                   have the right to dispute the rent by written notice received
                   by Landlord  within the ten (10) day time period.  Failure by
                   Tenant to dispute  the rent in this  manner  shall be deemed,
                   automatically  and  conclusively,  an acceptance by Tenant of
                   the rent  submitted.  Within  ten (10)  days  after  Landlord
                   receives  Tenant's  notice  disputing the rent,  Landlord and
                   Tenant  shall  each  designate  an   independent,   qualified
                   commercial  real estate  appraiser or expert,  who  regularly
                   conducts  business in Bergen  County and who is familiar with
                   Bergen County industrial  rentals,  for the purpose of having
                   them agree on the then fair market rent

                                        2

<PAGE>

                   for the Demised Premises which shall be the rental then being
                   collected  by owners of other  properties  for new  leases of
                   space reasonably comparable in type, size, location and usage
                   to the Demised Premises within Bergen County, New Jersey, for
                   a term  of  approximately  five  years  with  similar  tenant
                   expense assumptions and contributions.  In the event that the
                   two  designees  cannot  agree  upon  one  figure,   then  the
                   designees   shall  select  a  third  person  with  comparable
                   qualifications,  and  the  agreement  of  two  of  the  three
                   designees shall prevail,  or if two cannot agree, the average
                   of their three rents shall prevail. Landlord and Tenant shall
                   each pay the fees and  expenses  of their own  designee,  and
                   they  shall  share,  equally,  the fees and  expenses  of the
                   third;  and the greater of $37,380.44 or the fair market rent
                   so  determined  shall be the  fixed  minimum  rental  payable
                   monthly for the entire five-year option term. If Tenant gives
                   notice of the exercise of its option before November 1, 2008,
                   then  Landlord  shall have until  November 20, 2008 to submit
                   its determination of fair market rent.

                        (iv)  Within  seven (7) days after  Tenant has  received
                   written  notice  from  Landlord  of the fair  market  rent as
                   determined  pursuant to the preceding paragraph (iii), Tenant
                   shall  notify  Landlord,  in  writing,  whether or not Tenant
                   accepts  the  determination  that the base  rent  will be the
                   greater of the fair market rent so determined or  $37,380.44.
                   If Tenant so  accepts,  then the term shall be  extended  for
                   five (5) years at a monthly base rent equal to the greater of
                   the fair market rent so determined or  $37,380.44.  If Tenant
                   declines to accept or gives no notice at all, then the option
                   to extend will become null and void,  automatically,  and the
                   Lease  will   continue  in  full  force  and  effect  to  the
                   Termination  Date of  February  28,  2010.  If the  option to
                   extend becomes null and void, Tenant will pay to Landlord, as
                   additional  rent,  on the  first  day of the  next  following
                   month,  an  amount  equal to  Landlord's  share  of  expenses
                   incurred   and/or  owing  to   appraisers   and  experts  and
                   Landlord's reasonable attorney fee and related expenses.

                        (v) The Landlord and Tenant shall execute and deliver to
                   each other a written  statement  of the rent for the extended
                   term when determined as herein provided.

               4.  Paragraph  3.1 of the Original  Lease  captioned  "Rent",  as
                   previously  amended  by  the  Amendments  is  hereby  further
                   amended to add the following:

                        "Commencing  as of March 1, 2002,  Tenant  covenants and
                   agrees to pay the Landlord,  as and for the base rent for the
                   Demised Premises, in equal monthly installments,  in advance,
                   as set forth below,  on the first day of each and every month
                   of the term hereof:

                                        3

<PAGE>

                      Period of Term Lease            Monthly Rent
                      ------------------------------------------------
                      March 1, 2002 -                  $35,600.42
                       February 28, 2006

                      March 1, 2006 -                  $37,380.44
                       February 28, 2010

               5.  Paragraph 5.1 of the Lease, as previously amended, is further
                   amended to read as follows:

                        "5.1 Tenant may use and occupy the Demised  Premises for
                   any  use  permitted  by  the  ordinances  of the  Borough  of
                   Northvale,   with  Landlord's   consent  which  will  not  be
                   unreasonably withheld or delayed; provided, however, Landlord
                   will not be  required  to give its consent to a use which (i)
                   involves the  production,  use and/or  storage of substantial
                   amounts  of  hazardous  substances  or  hazardous  wastes  as
                   defined  in  federal,   state  or  local   laws,   rules  and
                   regulations,  and/or (ii) the use can be reasonably  expected
                   to cause extraordinary  destruction,  wear and/or tear to all
                   or part of the Demised Premises."

               6.  A new Paragraph 11.3 is hereby added to the Lease as follows:

                        "11.3  Notwithstanding  anything  contained in Paragraph
                   11.1 to the contrary, in the event that it becomes reasonably
                   necessary to replace the roof and/or its  covering,  in whole
                   or in part,  Landlord will do so at its own cost and expense,
                   and,  prior  to any  such  replacement  and  after  any  such
                   replacement,  Tenant will be  responsible  for all repairs to
                   the roof covering (except for the replacement  which shall be
                   Landlord's  obligation) as provided in Paragraph 11.1 of this
                   Lease.  If the  parties  cannot  agree upon the need for roof
                   replacement, then each party will designate a representative,
                   and  the  representatives  together  will  select  either  an
                   engineer or a recognized roofing contractor to make the final
                   determination which will be final and binding on the parties.
                   A  replacement  roof  will  be what is  commonly  known  as a
                   "twelve year roof with a twelve year warranty".

               7.  Tenant  acknowledges  that it accepts the Demised Premises in
                   its "as is" condition and will continue to be responsible for
                   all  repairs  as  provided  in  Paragraph  11.1 of the Lease,
                   except for  Landlord's  obligation to replace the roof and/or
                   its  covering as provided in  Paragraph 6 of this  Amendment.
                   Paragraph  9 of the  Amendment  dated May 28,  1992 is hereby
                   amended to add the following:

                        "(9) If Landlord has reasonable  cause to believe that a
                   spill  or   discharge   has   occurred   which  is   Tenant's
                   responsibility pursuant to Paragraph 9.A. hereof and Landlord
                   makes written demand to Tenant setting forth the

                                        4

<PAGE>

                   basis of its cause,  Tenant will obtain,  at its own expense,
                   and furnish to Landlord,  without charge,  within thirty (30)
                   days   after   receipt  of   Landlord's   demand  a  Phase  I
                   environmental  report prepared by a recognized  environmental
                   engineer  which will show the status of the Demised  Premises
                   with  regard to all  environmental  conditions.  In the event
                   that  the  report   shows  or   indicates   the  presence  or
                   possibility  of the presence of any  environmental  condition
                   which violates the laws, rules,  regulations or ordinances of
                   the State of New Jersey or the United  States of America  and
                   which are  Tenant's  responsibility  under this  Lease,  then
                   Tenant will obtain such additional  inspections,  reports and
                   tests as may be required to determine the nature and scope of
                   the  environmental  condition  and what will be  required  to
                   remedy the  condition and the cost  thereof.  Tenant,  at its
                   expense,  will remediate the  environmental  condition to the
                   satisfaction of all  governmental  agencies,  etc. and to the
                   reasonable satisfaction of Landlord."

               8.  Paragraph  15.1 A. of the  Lease,  as  previously  amended is
                   further amended to change "twenty-five (25) business days" to
                   "ten (10) business days".

               9.  Paragraph  18, the subject of which is a Renewal  Option,  is
                   hereby  deleted in its entirety and nothing is substituted in
                   its place.

               10. Paragraph  22 of the  Amendment  dated May 28, 1992 is hereby
                   deleted in its  entirety  as Landlord is now the owner of the
                   fee interest in the Demised Premises.

               11. Paragraph  23 of the  Amendment  dated May 28, 1992 is hereby
                   amended to delete  Edward S.  Gordon  Company of New  Jersey,
                   Inc. as the broker and to  substitute  Charles  Klatskin  and
                   Company and James E. Hanson,  Inc.,  (together the "Broker").
                   Landlord will pay the  commissions  due to the Broker arising
                   from  this  Amendment,  the sale of the  Premises  to  Tenant
                   pursuant to Section 15 of this Amendment and/or the extension
                   of the term pursuant to Section 3 of this Amendment  pursuant
                   to their  separate  agreement.  Landlord  will save,  defend,
                   indemnify  and hold  harmless  Tenant  from and  against  any
                   liability  to any other  broker with whom  Landlord has dealt
                   relative to this Lease and this  Amendment,  except Edward S.
                   Gordon  Company of New Jersey,  Inc.  Landlord  represents to
                   Tenant that Landlord has not entered into any agreement with,
                   nor assumed any agreement  with,  Edward S. Gordon Company of
                   New Jersey,  Inc.  relative to this Lease and this Amendment,
                   and the indemnity set forth in the next preceding sentence of
                   this   paragraph   will   apply   to  any   breach   of  this
                   representation  by  Landlord.   Tenant  will  save,   defend,
                   indemnify  and hold  harmless  Landlord  from and against any
                   liability  to any other  broker  (other than the Broker) with
                   whom Tenant has dealt  relative to this  Amendment or to whom
                   Tenant has any  contractual  obligation  with  respect to the
                   Lease.

                                        5

<PAGE>

               12. A new Paragraph is hereby added to the Lease as follows:

                        "Anything in this Lease to the contrary notwithstanding,
                   Tenant  agrees that Tenant shall look solely to the estate of
                   Landlord in the  property  in which the  Demised  Premises is
                   located,  and subject to the prior rights of any mortgagee of
                   the  property,  for the  collection of any judgment (or other
                   judicial process)  requiring the payment of money by Landlord
                   in the  event of any  default  or  breach  by  Landlord  with
                   respect to any of the terms, covenants and conditions of this
                   lease to be observed  and/or  performed by  Landlord,  and no
                   other assets of Landlord nor its partners, members, managers,
                   trustees, officers, directors,  stockholders or beneficiaries
                   shall be  subject  to levy,  execution  or other  enforcement
                   procedure for the satisfaction of Tenant's remedies."

               13. A new Paragraph is hereby added to the Lease as follows:

                        "Each  party  agrees  at any time and from  time to time
                   upon not less than ten (10) days'  prior  notice by the other
                   party or any mortgagee to execute, acknowledge and deliver to
                   the requesting  party or such mortgagee,  as the case may be,
                   or any other party specified by the requesting  party or such
                   mortgagee,  a statement in writing certifying that this lease
                   is unmodified  and in full force and effect (or if there have
                   been modifications, that the same is in full force and effect
                   as modified and stating the  modifications)  and the dates to
                   which the rent and other  charges  have been paid in advance,
                   if any, and stating  whether or not to the best  knowledge of
                   the  signer  of such  certificate  Tenant or  Landlord  is in
                   default  in  performance   of  any  covenant,   agreement  or
                   condition  contained  in this lease,  and, if so,  specifying
                   each such default of which the signer may have knowledge,  it
                   being intended that any such statement  delivered pursuant to
                   this paragraph may be relied upon by any prospective assignee
                   of this Lease,  purchaser of the fee or any mortgagee thereof
                   or any assignee of any mortgage.  However,  Landlord will not
                   be  obligated  to give such  statement  to Tenant  and/or its
                   designee more than once in any twelve (12) month period."

               14. The following is hereby added to the Lease:

                        "In the event  Tenant  requests  from  Landlord  and its
                   mortgagees  consents,  waivers and/or  subordination of liens
                   with respect to Tenant's furniture,  fixtures,  equipment and
                   personal  property   installed  or  located  in  the  Demised
                   Premises,  Landlord's  consent  and/or  agreement will not be
                   unreasonably withheld or delayed. However, if Tenant requests
                   Landlord   to   obtain   such   consents,    waivers   and/or
                   subordinations from its mortgagee, Landlord will cooperate by
                   submitting such requests to its mortgagee, but Landlord makes
                   no  representation or agreement that its mortgagee will

                                        6
<PAGE>

                   grant such request.  In the event  Landlord's  mortgagee does
                   not grant such  request,  such event will not be a default by
                   Landlord  pursuant  to this  Lease  nor  terminate  or modify
                   Tenant's  obligations pursuant to this Lease, and Tenant will
                   have no further right or recourse against  Landlord  relating
                   to such requested  consents,  waivers  and/or  subordination.
                   Tenant  will be  responsible  for the payment of all fees and
                   expenses to the mortgagee and will reimburse Landlord for its
                   reasonable attorney's fees incurred."

               15. The following is hereby added to the Lease:

                        "A.  Landlord  (hereinafter  referred  to as "Seller" in
                   this Section) hereby grants, bargains and extends unto Tenant
                   (hereinafter  referred to as  "Purchaser"  in this  Section),
                   their  successors and assigns but subject to the  limitations
                   on the right of assignment  as provided in this Section,  the
                   exclusive  right,  privilege and option to purchase,  for the
                   consideration   and  subject  to  the  terms  and  conditions
                   hereinafter  set forth,  all of Landlord's  right,  title and
                   interest in and to the  Demised  Premises  together  with the
                   building  machinery,  equipment  and fixtures of the Landlord
                   located  thereon  or used in the  operation  thereof  (all of
                   which  is  hereinafter   collectively   referred  to  as  the
                   "Premises"), and together with all right, title and interest,
                   if any,  of Seller in and to any land lying in the bed of any
                   street, road or avenue opened or proposed, public or private,
                   in front of or adjoining  the  Premises and all right,  title
                   and  interest  of Seller in and to any  awards  made or to be
                   made in lieu  thereof,  and in and to any  unpaid  award  for
                   damage  to the  Premises  by reason of change of grade of any
                   street; and Seller will execute and deliver to Purchaser,  on
                   closing  of title,  or  thereafter,  on  demand,  all  proper
                   instruments   for  the  conveyance  of  such  title  and  the
                   assignment and collection of any such award.

                        B.  This  option  shall  begin  as of the  date  of this
                   Amendment,  and  shall  extend  for a period  ending  at five
                   o'clock in the evening on August 15, 2007,  unless  exercised
                   or extended as hereinafter provided.

                        C.  Purchaser  will not have the right to exercise  this
                   option if it is then in default of any material  provision of
                   this Lease.

                        D.  Exercise  of the option  shall be by written  notice
                   given  by  Purchaser  to  Seller  in the  manner  hereinafter
                   provided  and  received by Seller not  earlier  than June 15,
                   2007 nor later  than  August 15,  2007.  Time shall be of the
                   essence  with regard to the dates during which the option may
                   be exercised and the acceptance of the Purchase Price.

                        E. Upon  timely  and  proper  exercise  of the option as
                   herein provided,  the purchase and sale of the Premises shall

                                        7
<PAGE>

                   be  consummated  not less  than ten (10)  days nor more  than
                   forty-five  (45) days next  following  the date of receipt by
                   Seller of the  notice of  acceptance  of the  Purchase  Price
                   (defined  in  Paragraph  G.1.a.  hereof),  upon  such date as
                   Purchaser  shall  designate  in the  notice  of  exercise  of
                   option,  at the place and time  hereinafter set forth in this
                   Agreement.

                        F. During the period of this Agreement,  Seller will not
                   permit any lien or encumbrance on the Premises except (i) the
                   granting  of  utility  easements  for  the  sole  purpose  of
                   servicing the Premises or (ii) the extension, modification or
                   refinancing of the presently existing first mortgage provided
                   that the principal amount will not exceed $5,250,000.00.

                        G. Upon exercise of the option, the sale and purchase of
                   the  Premises  shall be made  upon the  following  terms  and
                   conditions:

                                1. Purchase  Price.  a. The purchase  price (the
                   "Purchase  Price") for the  Premises  shall be the greater of
                   $5,250,000.00  or its fair market  value at time of exercise,
                   which Purchase Price  Purchaser  agrees to pay at the closing
                   good  federal  bank  funds  transferred  by wire to  Seller's
                   account.

                                        b. Within fifteen (15) days after Seller
                   receives Purchaser's notice of exercise,  Seller shall submit
                   to Purchaser,  in writing,  its  determination of fair market
                   value. Within ten (10) days after Purchaser receives the fair
                   market  value  figure,  Purchaser  shall  have  the  right to
                   dispute  the fair  market  value  figure  by  written  notice
                   received  by  Seller  within  the ten (10)  day time  period.
                   Failure by  Purchaser to dispute the fair market value figure
                   in  this   manner   shall  be   deemed,   automatically   and
                   conclusively,  an  acceptance by Purchaser of the fair market
                   value  figure  submitted.  Within five (5) days after  Seller
                   receives  Purchaser's  notice disputing the fair market value
                   figure,   Seller  and  Purchaser   shall  each  designate  an
                   independent,  qualified  commercial real estate  appraiser or
                   expert,  who regularly conducts business in Bergen County and
                   who is  familiar  with  Bergen  County  industrial  sales and
                   values, for the purpose of having them agree on the then fair
                   market value for the  Premises  which shall be the value then
                   being  received  by  sellers  of  other  properties  for real
                   property  reasonably  comparable in type, size,  location and
                   usage to the Premises  within Bergen County,  New Jersey.  In
                   the  event  that  the two  designees  cannot  agree  upon one
                   figure,  then the designees  shall select a third person with
                   comparable  qualifications,  and the  agreement of two of the
                   three  designees shall prevail,  or if two cannot agree,  the
                   average of their  three fair  market  values  shall  prevail.
                   Seller and Purchaser  shall each pay the fees and expenses of

                                       8
<PAGE>

                   their own designee,  and they shall share,  equally, the fees
                   and expenses of the third.

                                        c. Within ten (10) days after  Purchaser
                   has received written notice from Seller of the  determination
                   of the  Purchase  Price in  accordance  with this  paragraph,
                   Tenant  shall  notify  Landlord,  in writing,  whether or not
                   Tenant accepts the Purchase  Price.  If Tenant  accepts,  the
                   sale and purchase of the Premises  will proceed to a closing.
                   If Tenant  declines to accept or gives no notice at all, then
                   the  option  to   purchase   will   become   null  and  void,
                   automatically,  and the Lease will continue in full force and
                   effect to the  Termination  Date,  subject  to  extension  as
                   provided  in  Paragraph  2.3 of the  Lease.  If the option to
                   purchase  becomes null and void,  the Lease will  continue in
                   full force and effect to the Termination Date of February 28,
                   2010 or February 28, 2015,  as  applicable.  If the option to
                   purchase becomes null and void,  Tenant will pay to Landlord,
                   as additional  rent,  on the first day of the next  following
                   month,  an  amount  equal to  Landlord's  share  of  expenses
                   incurred   and/or  owing  to   appraisers   and  experts  and
                   Landlord's reasonable attorney fee and related expenses.

                                2. Permitted  Exceptions.  The Premises are sold
                   subject only to the following (the "Permitted Exceptions"):

                                        a. Such state of facts that may be shown
                   by an accurate  survey or personal  inspection  made prior to
                   the closing hereunder may disclose, provided the latter facts
                   do not render title unmarketable;

                                        b.  This  Lease   between   Seller,   as
                   landlord, and Purchaser,  as tenant, for the entire Premises;
                   and

                                        c. The easements,  agreements, covenants
                   and  restrictions  as set  forth  on  Schedule  "A"  which is
                   attached  hereto  and made a part  hereof  and  such  utility
                   easements as may  hereinafter  be granted by Landlord  solely
                   for the purpose of servicing the Premises.

                                3. The  Closing.  The  closing  (the  "Closing")
                   shall take place at the  offices of  Purchaser's  attorney or
                   title insurance  company in Bergen County,  New Jersey at the
                   time and on the date set  forth in  Purchaser's  notice  (the
                   "Closing Date").  Time shall be of the essence with regard to
                   the Closing Date.

                                4.  Apportionment.   The  following  are  to  be
                   apportioned  as the  Closing  as of  11:59  P.M.  on the  day
                   immediately  preceding the date on which Seller  receives the
                   proceeds of the Purchase Price before 2:00 P.M.

                                        a.  Rental  payments  pursuant  to  this
                   Lease; and

                                        9
<PAGE>

                                        b. Taxes (as  hereinafter  defined),  to
                   the extent not included in Rents  pursuant to paragraph a. of
                   this paragraph 4, if any, on the basis of the fiscal year for
                   which assessed,  except if the Closing shall occur before the
                   tax rate is fixed,  the  apportionment of Taxes shall be upon
                   the basis of one  hundred ten percent of the tax rate for the
                   immediately  preceding  fiscal  year  applied  to the  latest
                   assessed  valuation and there shall be a  readjustment  after
                   Closing when the final tax bill for the current year has been
                   received. The term "Taxes" shall mean all taxes,  assessments
                   (except as otherwise  provided in this paragraph b.), use and
                   occupancy  taxes,  water and sewer charges,  rates and rents,
                   charges for public utilities,  excises,  levies,  license and
                   permit fees assessed,  levied, charged,  confirmed or imposed
                   upon or  payable  out of or which  have  become a lien on the
                   Premises or any part thereof,  the  appurtenances  thereto or
                   the sidewalks,  streets, or vaults adjacent thereto;  but the
                   term  "Taxes"  shall  not  include  any  municipal,  state or
                   federal  income  taxes,   assessed  against  Seller,  or  any
                   municipal, state or federal capital levy, estate, succession,
                   inheritance  or transfer  taxes of Seller,  or any  franchise
                   taxes  imposed upon any corporate  owner of the Premises,  or
                   any part  thereof,  or any income,  profits or revenues  tax,
                   assessment  or charge  imposed upon the rent received as such
                   by Seller with respect to the Premises.  Notwithstanding  the
                   foregoing, if at the time of the Closing, any ordinance, rule
                   or law is in existence which provides for  improvements to be
                   constructed,  the cost of which will be  assessed in whole or
                   in part against the  Premises,  or the  Premises  shall be or
                   shall have been  affected by any  assessment  which is or may
                   become payable in installments then, for the purposes of this
                   Agreement,  all unpaid  installments of any such assessments,
                   including those which are to become due and payable after the
                   Closing, shall not be deemed to be due and payable and not to
                   be liens upon the Premises  affected thereby and shall not be
                   paid  and   discharged   by  Seller  upon   delivery  of  the
                   Instruments of Conveyance (as hereinafter defined),  but will
                   be assumed by Purchaser without adjustment;

                                        c.  Seller will be  responsible  for the
                   payment of any realty  transfer fee or other tax on the deed;
                   and

                                        d. Other  costs,  expenses  and  charges
                   usually  involved  and  adjusted  with regard to similar type
                   property.

                                To the  extent  that  the  adjustments  in  this
                   paragraph  are not based on final  figures  at  Closing,  the
                   applicable provisions of this paragraph shall survive Closing
                   of title.

                                       10
<PAGE>

                                5. Additional  Conditions.  Seller and Purchaser
                   agree to perform  and comply  with the  following  additional
                   conditions:

                                        a. Title.  At the  Closing,  Seller will
                   deliver to  Purchaser  such good and  sufficient  Bargain and
                   Sale  Deed with  covenants  against  grantor's  acts and such
                   other  instruments   (collectively   called  "Instruments  of
                   Conveyance")  as shall be  reasonably  required  to convey to
                   Purchaser  good  and  marketable  fee  simple  title  to  the
                   Premises   (together  with  any  easements  or  other  rights
                   appurtenant to the Premises) free and clear of all mortgages,
                   liens,   or   right   to   liens,   charges,    encumbrances,
                   encroachments,  easements, conditions and right of reentry or
                   forfeiture and other defects of title,  except such as appear
                   as Permitted Exceptions under paragraph 2 hereof.

                                        b. The  Lease.  At the  Closing,  Seller
                   will deliver to Purchaser an assignment (the "Assignment") of
                   all  right,  title and  interest  of  Seller  under the Lease
                   together with any advance  rental  deposits paid or deposited
                   by the tenant  thereunder  and Seller's  original copy of the
                   Lease.  Purchaser  shall  assume the  landlord's  obligations
                   under said Lease.  The Assignment  shall contain a release of
                   Seller,  as  landlord,  by the then  tenant and all  previous
                   tenants under the Lease for any and all liability,  claims or
                   causes of action existing or thereafter  arising  pursuant to
                   the Lease.

                                        c.  Title   Insurance.   Purchaser   may
                   obtain, at Purchaser's cost and expense,  a current survey of
                   the  Premises  and an  interim  title  insurance  report  and
                   commitment  to  issue an ALTA  Form  owners  title  insurance
                   policy ("title policy") issued by the title insurance company
                   which insured  Seller's  title when it acquired  title to the
                   Premises and reasonably satisfactory in substance and form to
                   Purchaser's  attorney  insuring  Purchaser's  interest as the
                   holder of good and marketable  indefeasible  title in and fee
                   simple, insurable by a title insurance company licensed to do
                   business in the State of New Jersey at regular rates, subject
                   only to the Permitted  Exceptions under Section 2 hereof. The
                   survey  and  interim  title  insurance  commitment  shall  be
                   obtained by  Purchaser's  attorney not later than twenty (20)
                   days prior to the Closing.  If the Purchaser  finds the title
                   and survey do not  conform to the  provisions  of this Lease,
                   the  Purchaser  or its  attorney  shall  notify the Seller in
                   writing within said twenty-day period, specifying the defects
                   and the Seller  shall have  thirty  days from the  receipt of
                   such notice to cure the defects so specified. However, Seller
                   shall  pay in full and  discharge  at or before  Closing  all
                   judgments which it is not appealing and all mortgages  and/or
                   mechanics'  liens  created  by Seller  which are shown on the

                                       11
<PAGE>

                   interim title insurance commitment and on the continuation at
                   Closing,  except those which are  Permitted  Exceptions,  and
                   Seller  shall  be  permitted  to use a  portion  of the  cash
                   proceeds to be received at Closing to pay the same.  The cost
                   of the  interim  title  insurance  commitment  and the owners
                   title  insurance  policy and the survey  shall be paid by the
                   Purchaser.

                                        d.  Violations.  At the Closing,  Seller
                   shall  not be  required  to  comply  with and  discharge  any
                   notices of violations of law or municipal ordinances,  orders
                   or requirements  received by it and issued by the Departments
                   of Buildings,  Fire, Labor, Health or other federal, state or
                   municipal   departments   having   jurisdiction   against  or
                   affecting  the  Premises  at the  date  of  closing,  and the
                   Premises  shall  be  conveyed  subject  to the  same  without
                   adjustment between the parties.

                                        e.  Certificates.  Prior to the Closing,
                   Purchaser  will  obtain  and  deliver  (i) a  Certificate  of
                   Occupancy   or   Continued   Use,   (ii)  a  smoke   detector
                   certificate, and (iii) other permits and approvals if any one
                   or more are  required by the Borough  because of the transfer
                   of title.  Purchaser  will be  responsible  for any  repairs,
                   replacements  or   installations   required  to  obtain  such
                   certificates, permits and approvals.

                                        f.  Condition  of the  Premises.  At the
                   Closing,  the  Premises  shall  be in the  condition  as then
                   exists.

                                        g.  Affidavit of Title.  At the Closing,
                   Seller shall  execute and deliver to Purchaser  and its title
                   insurance company an affidavit of title in customary form but
                   with  representations  and  warranties  limited  to  Seller's
                   actions  during the period of its ownership and with recourse
                   for any matters  contained in the affidavit limited to Seller
                   and not the affiant personally.

                                        h.  Other  Documents.  At  the  Closing,
                   Seller shall deliver to Purchaser and to the title  insurance
                   company  satisfactory  evidence that all necessary company or
                   other  action  on the  part of  Seller  has been  taken  with
                   respect to the execution  and delivery of this  Agreement and
                   the  consummation of the transaction  contemplated  hereby so
                   that all of said  documents  are or will be validly  executed
                   and delivered and will be binding upon the Seller.

                                        i. Foreign  Investment  in Real Property
                   Tax Act ("FIRPTA") Compliance.

                                            (a) At  the  Closing,  Seller  shall
                   deliver to Purchaser a Certification  of Non-foreign  Status,
                   duly executed and containing such other information as may be

                                       12
<PAGE>

                   required  by  Internal  Revenue  Code  Section  1445  and the
                   regulations issued thereunder.

                                            (b) Anything herein contained to the
                   contrary  notwithstanding,  in the  event  that  Seller  is a
                   "foreign person" (as defined in Internal Revenue Code Section
                   1445) or in the event that Seller fails or refuses to deliver
                   the Certification of Non-foreign  Status as aforesaid,  or in
                   the  event   that   Purchaser   receives   notice   from  any
                   Seller-transferor's  agent  or  Purchaser-transferee's  agent
                   (each as defined in Internal  Revenue  Code  Section 1445 and
                   the  regulations  issued  thereunder)  that, or Purchaser has
                   actual knowledge that, said Certification is false, Purchaser
                   shall deduct and withhold from the purchase  price under this
                   Contract  a tax equal to ten  percent  (10%)  thereof or such
                   other  amount,  as required by Internal  Revenue Code Section
                   1445.  In  the  event  of  any  such  withholding,   Seller's
                   obligation to deliver title hereunder shall not be excused or
                   otherwise  affected,  Purchaser  shall pay over such withheld
                   amount to the Internal  Revenue Service  together with filing
                   such form as may be required thereby, and Seller in the event
                   of any claimed over-withholding shall be limited solely to an
                   action against the Internal Revenue Service for a refund, and
                   hereby  waives  any  right of  action  against  Purchaser  on
                   account of such withholding. The provisions of this paragraph
                   shall survive the Closing.

                                6. Representations and Warranties of Seller. For
                   the purpose of inducing  Purchaser to accept this option, and
                   to consummate the transactions  contemplated  hereby pursuant
                   to the terms and  conditions  hereof,  Seller  represents and
                   warrants to Purchaser as follows:

                                        (a) Except  for the Lease,  there are no
                   agreements  of any nature  with any tenant,  whether  oral or
                   written, affecting the Premises;

                                        (b)  Seller  has not  entered  into  any
                   management,  service,  supply and maintenance  contracts with
                   respect  to the  Premises  which  will not be  terminated  by
                   Seller at the Closing.

                                        (c) Seller has the full right, power and
                   authority  to sell and convey the  Premises to  Purchaser  as
                   provided herein and to carry out its obligations hereunder.

                                        The  representations  and  warranties as
                   set forth in this Agreement  shall be continuing and shall be
                   true and correct on and as of the closing  date with the same
                   force and  effect  as if made at that time and shall  survive
                   Closing for a period of six (6) months.

                                7.  Condition  of  Premises.   Seller  makes  no
                   representations or warranties with regard to the condition of

                                       13
<PAGE>

                   the  Premises  or  its  components,  including  environmental
                   conditions  and matters.  Purchaser has occupied the Premises
                   as a tenant and has been given the opportunity to examine the
                   Premises. Purchaser will conduct such inspections,  tests and
                   investigations,  including  those  related  to  environmental
                   matters and  conditions,  as Purchaser  may want prior to its
                   exercise  of the  option to  purchase,  and there  will be no
                   conditions  to the  closing  of title  as a  result  thereof.
                   Purchaser's  sole  remedy  if it is not  satisfied  with  the
                   results of its inspections,  test and investigations  will be
                   to refuse to  exercise  its option to  purchase.  It shall be
                   conclusive evidence, as against Purchaser, that Purchaser has
                   accepted  the  Premises in "as is"  condition  on the Closing
                   Date,  and  that  the  Premises  and  its  components  are in
                   satisfactory  condition.  In the event  Purchaser  causes any
                   inspections  to be made,  Purchaser  will furnish Seller with
                   copies of all reports, without charge.

                                8.  Eminent  Domain or  Casualty.  If, after the
                   exercise of the option and prior to the  Closing,  all or any
                   portion of the Premises is taken by eminent domain (or is the
                   subject of a pending  or  contemplated  taking  which has not
                   been  consummated)  or damaged or  destroyed by fire or other
                   casualty and Purchaser has the right to terminate  this Lease
                   as a result thereof, Purchaser shall have the right to either
                   (i) terminate  this Lease and its  obligation to purchase the
                   Premises, or (ii) take title in such condition as then exists
                   without  any  obligation  on the part of  Seller  to  repair,
                   restore or rebuild the Premises. In the event that the damage
                   or taking is not  sufficient  to permit  Tenant to  terminate
                   this  Lease,  Purchaser  will  complete  the closing of title
                   without  adjustment  in the  Purchase  Price.  In  the  event
                   Purchaser elects to complete the purchase,  there shall be no
                   adjustment  in the  Purchase  Price  and  Purchaser  shall be
                   entitled  to  receive  all of the  proceeds  of the taking by
                   eminent domain or the insurance proceeds.

                                9.   Compliance   with   ISRA   Purchaser,    at
                   Purchaser's   expense,   will  comply  with  the  New  Jersey
                   Industrial  Site Recovery Act or such other law then existing
                   which  relates to  environmental  approvals  upon the sale of
                   real  property  and/or the  cessation of business  operations
                   (together "ISRA") as it applies to this sale.  Purchaser will
                   apply for and diligently  pursue the issuance of either (i) a
                   Letter of  Non-Applicability,  (ii) a  Negative  Declaration,
                   (iii) a No Further  Action  Letter or (iv) such  other  final
                   approvals as may then be required. Seller will cooperate with
                   Purchaser by furnishing  information  reasonably required and
                   will sign the application,  if required.  In the event of the
                   failure to obtain a Letter of  Non-Applicability,  a Negative
                   Declaration,  a No Further  Action  Letter or other  required
                   final  approval  prior to the Closing  Date,  (time is hereby
                   made of the essence  with regard to such time  period),  then
                   the right to purchase

                                       14
<PAGE>

                   will  be  deemed  null  and  void   absolutely  and  forever,
                   automatically,  and the remainder of this Lease will continue
                   in full and effect.

                                10.    Notices.    All    notices    and   other
                   communications  hereunder  shall be in  writing  and shall be
                   delivered or mailed by registered or certified  mail,  return
                   receipt  requested,  postage  prepaid  or by public  courier,
                   delivery charges prepaid,  addressed (a) if to Seller, at the
                   address hereinabove set forth and (b) if to Purchaser, at the
                   address  hereinabove  set forth.  Notices  shall be effective
                   only upon receipt or refusal of delivery by addressee. Either
                   party  may by  notice  as  aforesaid  designate  a  different
                   address for notices or other communications  intended for it.
                   Any  notice  given  under  this  Agreement  shall  also,  for
                   information purposes only, be sent to Purchaser's  attorneys,
                   Lowenstein  Sandler PC, 65 Livingston Avenue,  Roseland,  New
                   Jersey 07068-1791,  Attention:  R. Barry Stiger, Esq., and to
                   Seller's  attorneys,  Poley & Rich,  Esqs., 235 Moore Street,
                   Hackensack,  New Jersey  07601,  Attention:  M. Robert Poley,
                   Esq.

                                11. Brokerage.  Except for the Broker, Purchaser
                   and Seller  represent  that they have not dealt with any real
                   estate  broker or other party who may claim or be entitled to
                   a commission in connection with the sale contemplated hereby.
                   Seller will be responsible  for payment of commissions to the
                   Broker  pursuant  to their  separate  agreement.  Each  party
                   agrees to indemnify  and hold harmless the other from any and
                   all claims for any such brokerage commissions,  finder's fees
                   or the like made by any other broker or entity with whom such
                   party  dealt.  It is agreed that if any claims for  brokerage
                   commissions or fees are ever made against Seller or Purchaser
                   in connection with this transaction, all such claims shall be
                   handled  and paid by the party  whose  alleged  actions  were
                   alleged  commitments  for the  basis of such  claim,  and the
                   party whose alleged actions or alleged  commitments  form the
                   basis of such claim shall  indemnify  and hold  harmless  the
                   other from and against  any and all such claims and  demands,
                   including  reasonable  attorney's  fees incurred in defending
                   the same,  with  respect  to any  brokerage  fees or  agent's
                   commissions  or other  compensation  asserted  by any person,
                   firm  or  corporation  in  connection  with  this  option  to
                   purchase  or  the  transactions   contemplated   hereby.  The
                   provisions of this paragraph shall survive closing of title.

                                12.  Specific  Performance.  In the event either
                   party  hereto fails to comply with any of the  provisions  of
                   this Agreement, then, in addition to all other legal remedies
                   to which the other party hereto is entitled, such other party
                   shall have the right to specific performance.

                                       15
<PAGE>

                                13. Breach by Purchaser.  In the event Purchaser
                   shall fail to  consummate  the  purchase of the  Premises and
                   Purchaser  being in  default  and Seller not being in default
                   herein,  and Seller  having  complied  or being  prepared  to
                   comply at Closing with all conditions herein, Seller shall be
                   entitled  to  payment  of an amount  equal to its  reasonable
                   attorneys fees and other actual costs relating to the sale of
                   the Premises by  Purchaser  and any  penalties,  late charges
                   and/or  extension fees paid to its mortgagee,  such sum being
                   agreed  upon  as  liquidated   damages  for  the  failure  of
                   Purchaser to perform the duties, liabilities, and obligations
                   imposed  upon  it  by  the  terms  and   provisions  of  this
                   Agreement,  and Seller  agrees to accept and take said amount
                   as total damages and as Seller's sole remedy in such event.

                                14. Deed Tax.  Seller will pay all deed transfer
                   taxes and  documentary  stamps  and  similar  taxes,  without
                   reimbursement from Purchaser.

                                15. Like-Kind Exchange.  Purchaser  acknowledges
                   that Seller may desire to exchange  the Premises as part of a
                   like-kind  exchange  transaction  that  would  qualify  under
                   Sections  1031 and/or 1033 of the  Internal  Revenue Code for
                   non-recognition  treatment.  At Seller's election,  Purchaser
                   agrees,  at Seller's  expense and provided such exchange does
                   not cause the  acquisition of the Premises by Purchaser to be
                   delayed in any way, to  cooperate  with Seller in effecting a
                   qualifying  like-kind exchange through a trust or other means
                   determined  by  Seller,  and  Purchaser  shall  execute  such
                   documents as may be reasonably requested by Seller, provided:
                   (i) Purchaser  shall have no liability  under such documents,
                   and (ii) such  documents  contain no language  or  provisions
                   which  would cause  Purchaser  to become part of the chain of
                   title with respect to any other property which is part of the
                   exchange.   Purchaser  makes  no  representations  to  Seller
                   regarding  qualification  of the exchange under Sections 1031
                   and/or 1033 of the Internal Revenue Code, and Purchaser shall
                   not be  liable  to Seller  in any  manner  whatsoever  if the
                   exchange  completed in accordance with this paragraph  should
                   not qualify for any reasons  under  Sections 1031 and/or 1033
                   of the Internal  Revenue Code.  Seller  reserves the right to
                   assign  its rights but not its  obligations,  hereunder  to a
                   Qualified   Intermediary  as  provided  in  IRC  Reg.  1.1031
                   (k)-l(G)(4) on or before the Closing.

                                16.  Miscellaneous.   This  Agreement  shall  be
                   binding  upon and inure to the benefit of and be  enforceable
                   by  the  respective  parties  hereto  and  their  successors,
                   executors,  administrators,   personal  representatives,  and
                   assigns.  Purchaser  shall not have the right to assign  this
                   Agreement or any interest  herein  without the prior  written
                   consent  of Seller;  however,  Seller  will not  unreasonably

                                       16
<PAGE>

                   withhold  its  consent to an  assignment  (i) to a  permitted
                   assignee of the Lease or (ii) an assignment of only the right
                   to purchase  the  Premises to an entity  which is  affiliated
                   with  Purchaser  made after the option has been exercised and
                   prior to the Closing Date.  This Agreement shall be construed
                   in  accordance  with and governed by the laws of the State of
                   New Jersey.  No waiver by any party of any breach  under this
                   option  section  shall be  deemed a  waiver  of any  other or
                   subsequent breach."

        16. Tenant hereby affirms the validity of the Lease and confirms
that the Lease remains  enforceable  and in full force and effect as of the date
of execution of this Amendment.

               17. The  obligations  of  Landlord  and Tenant  pursuant  to this
Amendment  are  conditioned  upon the  Landlord  obtaining  the  consent  of its
mortgagee and the execution of a Subordination,  Non-Disturbance  and Attornment
Agreement with regard to this Amendment in the form required by the mortgagee on
or before thirty (30) days after Landlord has received a fully executed original
of this Amendment. Landlord will each pay to the mortgagee all fees and expenses
charged by the  mortgagee,  its attorneys  and a rating  agency  related to such
consent,  without  reimbursement by Tenant.  In the event this condition has not
been satisfied,  this Amendment will terminate automatically,  and the Lease, as
previously amended, will continue in full force and effect as originally stated.

               18.  Except as otherwise  provided  herein,  all of the terms and
provisions of the Lease shall continue in full force and effect. In the event of
any  conflict  between  the  provisions  of this  Amendment  and the Lease,  the
provisions of this Amendment shall govern and prevail.

               19.  This  Amendment  shall be binding  upon and shall be for the
benefit of the parties hereto and their respective successors and assigns.

               The parties have executed this  Amendment on the date first above
written.

Witness:                                       Landlord:

                                               Northvale 1997 Associates, L.L.C.
                                               By: NV Northvale Management
                                                    Corp., a New Jersey
                                                    corporation, its Manager

 /s/ Sara Jane Wilson                       By:  /s/ Jon F. Hansen, Pres.
--------------------------------               ---------------------------
     Sara Jane Wilson                                Jon F. Hansen, Pres.

Witness:                                       Tenant:

                                               Baltek Corporation

 /s/ Harold Gutman                          By:  /s/ Ronald Tassello
---------------------------------              -----------------------------
Harold Gutman                                  Ronald Tassello
Vice President of Manufacturing                Chief Financial Officer

                                       17
<PAGE>

                                   Exhibit "A"

     1.   Facts shown on survey of the  property  dated July 28, 1997 by Kenneth
          J. Job, Licensed Professional Land Surveyor.

     2.   Right-of-way grant in Deed Book 5236 at page 265.

     3.   Right-of-way grant in Deed Book 5830 at page 313.

                                       18

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00017-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00017-of-00352.parquet"}]]