Document:

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                                                                   EXHIBIT 10.80

                     ADMISSION OF NEW PARTNER AND AMENDMENT
                        TO LIMITED PARTNERSHIP AGREEMENT

          THIS ADMISSION OF NEW PARTNER AND AMENDMENT TO LIMITED PARTNERSHIP
AGREEMENT (this "Admission and Amendment") is entered into as of the 6th day of
                 -----------------------
October, 2000 (the "Closing Date") by and between Kilroy Realty, L.P., a
Delaware limited partnership (the "Partnership") and Kilroy Airport Imperial
                                   -----------
Company, a California limited partnership (the "New Partner").  All capitalized
                                                -----------
terms contained herein, unless otherwise defined herein, shall have the meanings
provided in the Partnership Agreement (as defined below).

                                    RECITALS

          WHEREAS, the partners of the Partnership are parties to the Fourth
Amended and Restated Agreement of Limited Partnership, dated November 24, 1998
amended through the date hereof (as so amended, the "Partnership Agreement").
                                                     ---------------------
The general partner of the Partnership is Kilroy Realty Corporation, a Maryland
corporation (hereinafter the "Company" or the "General Partner"); and
                              -------          ---------------

          WHEREAS, Section 12.2 of the Partnership Agreement contemplates the
admission of Additional Limited Partners; and

          WHEREAS, the New Partner owns a 99% limited partnership interest in
Imperial Partners 25, L.P., a Delaware limited partnership (the "L.P.
                                                                 ----
Property");
--------

          WHEREAS, the New Partner and the Partnership have entered into that
certain Contribution Agreement dated as of the Closing Date (the "Contribution
                                                                  ------------
Agreement") pursuant to which the New Partner will contribute the L.P. Property
---------
to the Partnership in exchange for Common Units of the Partnership (as more
particularly described in the Contribution Agreement); and

          WHEREAS, the New Partner and the Partnership have entered into that
certain Contribution/Guarantee Agreement dated as of the Closing Date, pursuant
to which the New Partner will contribute cash to the Partnership under the
circumstances specified therein.

          NOW THEREFORE, in consideration of the foregoing, of the covenants,
promises and undertakings set forth herein, and for good and valuable
consideration, the receipt of which is hereby acknowledged, the Partnership and
the New Partner hereby agree as follows:

     1.  Contribution and Issuance of Common Units.  In exchange for its
         -----------------------------------------
contribution of the L.P. Property, on the Closing Date (as defined in
Contribution Agreement) the New Partner shall become an Additional Limited
Partner of the Partnership pursuant to Section 12.2 of the Partnership Agreement
and shall receive an aggregate of 1,133 Common Limited Partnership Units, based
on a price per Common Limited Partnership Unit equal to $26.47510, the average
Closing Price of the Company's common stock, par value $.01 per share (the
"Common Stock") on The New York Stock Exchange, for the ten consecutive trading
 ------------
days ending two business days before the Closing Date, rounded to the nearest
whole Common Limited Partnership Unit.
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     2.  Admission as Additional Limited Partners.  By its signature hereto on
         ----------------------------------------
behalf of the Partnership and all of the Partners thereof, the Company, as
general partner of the Partnership, hereby consents to the admission of the New
Partner as an Additional Limited Partner on the Closing Date.

     3.  Agreement to Become Additional Limited Partners.  The New Partner
         -----------------------------------------------
hereby agrees to become an Additional Limited Partner and agrees to be bound by
all the terms and conditions of, and to make the representations and warranties
set forth in, the Partnership Agreement as amended to date.  Furthermore, the
parties to this Admission and Amendment agree to be bound by the terms of the
Contribution Agreement, which shall be incorporated herein by this reference.

     4.  Power of Attorney.
         -----------------

             (a)  The New Partner constitutes and appoints the General Partner,
any Liquidator (as defined in the Partnership Agreement), and authorized officer
and attorney-in-fact of each, and each of those acting singly, in each case with
full power of substitution, as its true and lawful agent and attorney-in-fact,
with full power and authority in its name, place and stead to:

                  (1)  execute, swear to, acknowledge, deliver, file and record
in the appropriate public offices (i) all certificates, documents and other
instruments (including, without limitation, the Partnership Agreement and the
Certificate of Limited Partnership of the Partnership and all amendments or
restatements thereof) that the General Partner or the Liquidator deems
appropriate or necessary to form, qualify or continue the existence or
qualification of the Partnership as a limited partnership (or a partnership in
which the Limited Partners have limited liability) in the State of Delaware and
in all other jurisdictions in which the Partnership may conduct business or own
property; (ii) all instruments that the General Partner or any Liquidator deems
appropriate or necessary to reflect any amendment, change, modification or
restatement of the Partnership Agreement in accordance with its terms; (iii) all
conveyances and other instruments or documents that the General Partner or any
Liquidator deems appropriate or necessary to reflect the dissolution and
liquidation of the Partnership pursuant to the terms of the Partnership
Agreement, including, without limitation, a certificate of cancellation; (iv)
all instruments relating to the admission, withdrawal, removal or substitution
of any Partner (as defined in the Partnership Agreement) pursuant to, or other
events described in, Article 11, 12 or 13 of the Partnership Agreement or the
Capital Contribution (as defined in the Partnership Agreement) of any Partner;
and (v) all certificates, documents and other instruments relating to the
determination of the rights, preferences and privileges of Partnership
Interests; and

                  (2)  execute, swear to, acknowledge and file all ballots,
consents, approvals, waivers, certificates and other instruments appropriate or
necessary, in the sole and absolute discretion of the General Partner or any
Liquidator, to make, evidence, give, confirm or ratify any vote, consent,
approval, agreement, or other action which is made or given by the Partners
under the Partnership Agreement or is consistent with the terms of the
Partnership Agreement or appropriate or necessary, in the sole discretion of the
General Partner or any Liquidator, to effectuate the terms or intent of this
Admission and Amendment or the Partnership Agreement.

                                       2
<PAGE>

Nothing contained herein shall be construed as authorizing the General Partner
or any Liquidator to amend the Partnership Agreement except in accordance with
Article 14 thereof or as may be otherwise expressly provided for in the
Partnership Agreement.

          (b)  The foregoing power of attorney is hereby declared to be
irrevocable and a power coupled with an interest, in recognition of the fact
that the New Partner will be relying upon the power of the General Partner and
any Liquidator to act as contemplated by the Partnership Agreement in any filing
or other action by it on behalf of the Partnership and it shall survive and not
be affected by the subsequent Incapacity of any New Partner or its Assignee and
the transfer of all or any portion of such New Partner's or such Assignee's
Common Units and shall extend to each New Partner's heirs, successors, assigns
and personal representatives. The New Partner hereby agrees to be bound by any
representation made by the General Partner or any Liquidator, acting in good
faith pursuant to such power of attorney; and the New Partner or any Assignee
hereby waives any and all defenses which may be available to contest, negate or
disaffirm the action of the General Partner or any Liquidator, taken in good
faith under such power of attorney. The New Partner shall execute and deliver to
the General Partner or any Liquidator, within 15 days after receipt of the
General Partner's or Liquidator's request therefor, such further designation,
powers of attorney and other instruments as the General Partner or the
Liquidator, as the case may be, deems necessary to effectuate the Partnership
Agreement, this Admission and Amendment and the purposes of the Partnership.

     5.   Redemption/Exchange Rights.  Notwithstanding the provisions of Section
          --------------------------
8.6 of the Partnership Agreement, the New Partner shall not be entitled to the
redemption/exchange rights stipulated in Section 8.6 of the Partnership
Agreement with respect to any Common Limited Partnership Units held by the New
Partner until a period of one year has elapsed since the Closing Date (as
defined in the Contribution Agreement).  Except for the foregoing, the
procedures for tendering Common Units after the anniversary of the Closing Date,
including, without limitation, the methodology for calculating the cash
redemption value, provisions regarding the General Partner's option to exchange
tendered Common Limited Partnership Units for its Common Stock in lieu of a
redemption, and restrictions on a New Partner's ability to exercise such rights
shall be as provided in Section 8.6 of the Partnership Agreement.

     6.   Partnership Distributions and Allocations.
          -----------------------------------------

                  (a)  Distributions.  The New Partner shall be entitled to
                       -------------
distributions based on the number of Common Units held by the New Partner on the
applicable Partnership Record Dates in accordance with Article 5 of the
Partnership Agreement; provided, however, the amount of the distribution to the
New Partner for the quarter in which the New Partner is admitted to the
Partnership shall be prorated based upon the actual number of days that the New
Partner was a Partner during such quarter.

                  (b)  Allocations of Income and Loss.  The New Partner shall be
                       ------------------------------
allocated Net Income or Net Loss in accordance with its Percentage Interest in
the Partnership, subject to the Regulatory Allocations, in accordance with
Article 6 and Section 12.2.B of the Partnership Agreement.

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<PAGE>

                  (c)  Section 704(c) Allocations.  Notwithstanding anything to
                       --------------------------
the contrary in the Partnership Agreement, this Admission and Amendment or the
Contribution Agreement, Tax Items with respect to Partnership Interests (or
underlying property) which are being contributed to the Partnership by the New
Partner (including Tax Items resulting from any adjustment to the Gross Asset
Value of such properties) shall be shared among the Partners in accordance with
Section 6.4 of the Partnership Agreement using the "traditional method" as
described in Regulations Section 1.704-3(b)(1).

     7.   Miscellaneous.
          --------------

                  (a)  In the event of any conflict between the Partnership
Agreement and this Admission and Amendment, the provisions of this Admission and
Amendment shall supersede any and all conflicting or different provisions
contained within the Partnership Agreement. Any amendments to this Admission and
Amendment, including, without limitation, any amendments affecting the
transferability of the Common Limited Partnership Units, must be executed by the
New Partner in order to be effective. This Admission and Amendment shall be
deemed to be an amendment to the Partnership Agreement.

                  (b)  This Admission and Amendment may be executed in any
number of counterparts and each such counterpart shall be deemed to be an
original, but all of which, when taken together, shall constitute one agreement.

                            (Signature Page Follows)

                                       4
<PAGE>

          IN WITNESS WHEREOF, the parties have entered into this Admission and
Amendment as of the date and year first written above.

                              "THE PARTNERSHIP"

                              KILROY REALTY, L.P.,
                              a Delaware limited partnership

                              By:   KILROY REALTY CORPORATION
                                    a Maryland corporation, its general partner

                                    By: /s/ Hugh Green
                                        ------------------------------
                                    Name: HUGH GREEN
                                          ----------------------------
                                    Its: EXECUTIVE VICE PRESIDENT

                                    By: /s/ Tyler H. Rose
                                        ------------------------------
                                    Name: TYLER H. ROSE
                                          ----------------------------
                                    Its:  SENIOR VICE PRESIDENT AND
                                          TREASURER
                                          ----------------------------

                              NEW PARTNER

                              KILROY AIRPORT IMPERIAL COMPANY,
                              a California limited partnership

                              By:   The Kilroy Company
                                    a California corporation, its general
                              partner

                                    By: /s/ Marshall L. McDaniel
                                        ------------------------------
                                    Name: MARSHALL L. McDANIEL
                                          ----------------------------
                                    Its:  EXECUTIVE VICE PRESIDENT AND
                                          SECRETARY
                                          ----------------------------

                                      S-1<PAGE>

                                                                    EXHIBIT 4.13

THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED FOR INVESTMENT
AND HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933.  THE SECURITIES
MAY NOT BE SOLD OR TRANSFERRED IN THE ABSENCE OF REGISTRATION OR AN EXEMPTION
THEREFROM.  THE SECURITIES REPRESENTED BY THIS CERTIFICATE AND THE RIGHTS OF THE
HOLDER HEREOF ARE SUBJECT TO CERTAIN RESTRICTIONS ON TRANSFER AND OTHER
RESTRICTIONS, AND THE HOLDER OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE
(INCLUDING ANY FUTURE HOLDER) IS BOUND BY THE TERMS OF A WARRANT PURCHASE
AGREEMENT BETWEEN THE ORIGINAL PURCHASER AND THE COMPANY (COPIES OF WHICH MAY BE
OBTAINED FROM THE COMPANY).

            WARRANT TO PURCHASE 3,000,000 SHARES OF COMMON STOCK OF
                                  MATTEL, INC.

          This certifies that the holder hereof (the "Holder"), for value
                                                      ------
received, is entitled to purchase from Mattel, Inc., a Delaware corporation (the
"Company"), three million (3,000,000) fully paid and nonassessable shares (the
 -------
"Warrant Shares") of the Company's common stock, par value $1.00 per share (the
---------------
"Common Stock"), at a price of $10.875 per share (the "Stock Purchase Price") at
 ------------                                          --------------------
any time on or after July 26, 2000 (the "Issue Date"), up to and including 5:00
                                         ----------
p.m. (Pacific time) on the Expiration Date (as defined below), upon (a)
surrender to the Company at its principal offices at 333 Continental Boulevard,
El Segundo, California 90245 (or at such other reasonable location as the
Company may advise the Holder in writing) of this Warrant properly endorsed with
the Form of Subscription attached hereto duly completed and signed, and (b)
either (i) compliance with the exercise mechanism (such mechanism referred to as
a "Cashless Exercise") set forth in Section 1(B) of this Warrant, or (ii) with
   -----------------
the consent of the Company (which shall not be unreasonably withheld), payment
by wire transfer of immediately available funds of the aggregate Stock Purchase
Price for the Warrant Shares.  The Company shall provide the Holder a reasonable
opportunity to ask questions and receive answers concerning the terms and
conditions of the purchase of shares of Common Stock pursuant to its exercise of
the Warrant and to obtain any additional information from the Company that is
reasonably necessary to verify the information furnished in the SEC Documents.
The exercise of this Warrant is hereby expressly conditioned upon the accuracy
of all representations and warranties contained in such Form of Subscription.
The Stock Purchase Price and the number of shares purchasable hereunder are
subject to adjustment as provided in Section 3 of this Warrant.  "Expiration
                                                                  ----------
Date" shall mean December 31, 2003 (or, in the event that December 31, 2003 is
----
not a business day, the next succeeding business day).  Notwithstanding the
above, in the event and only to the extent that this Warrant has not been
previously exercised, this Warrant shall terminate immediately in the event that
the License Agreement, dated as of January 28, 2000, by and between the Company
and Purchaser has been terminated by the Company as a result of a material
breach by Purchaser (after notice of such breach from the Company and an
opportunity to cure within ten (10) business days).  Termination by Purchaser as
a result of a material breach by the Company shall not result in termination of
the Warrant.

          At any time prior to the Expiration Date, at the election of the
Holder hereof, this Warrant, which represents the Holder's right to purchase
three million (3,000,000) fully-paid and non-assessable shares of the Company's
Common Stock at the Stock Purchase Price (the "Original Warrant"), may be
                                               ----------------
divided into two equal Warrants (each, a "One-half Warrant"), each
                                          ----------------
<PAGE>

One-half Warrant representing the right to purchase one and one-half million
(1,500,000) fully-paid and nonassessable shares of the Company's Common Stock at
the Stock Purchase Price. Except for such number of shares issuable upon
exercise thereof, each One-half Warrant shall have the same terms and
provisions, and be subject to the same conditions, notice provisions and
restrictions on exercise and transfer, and be identical in all other respects,
to the Original Warrant. From and after the time the Original Warrant becomes
divided into two One-half Warrants, all references herein and in the Warrant
Purchase Agreement, dated as of July 26, 2000 (the "Warrant Purchase
                                                    ----------------
Agreement"), by and between the Company and the Purchaser, to (a) the "Holder"
---------
of this Warrant shall be deemed to refer to the rightful holder of each One-half
Warrant and (b) this "Warrant" shall be deemed to refer to each One-half
Warrant.

          This Warrant (or One-half Warrant, as the case may be) may only be
exercised as a whole and may not be exercised in part or from time to time.

          This Warrant is issued pursuant to, and subject to the provisions of,
the Warrant Purchase Agreement and, by its acceptance of this Warrant, the
Holder expressly agrees to comply with the provisions of the Warrant Purchase
Agreement applicable to this Warrant (including, without limitation, the
provisions contained in Section 5(C) relating to subsequent transfers of this
Warrant and in Section 5(E) relating to the exercise procedure applicable to
this Warrant).  Terms used but not defined in this Warrant shall have the
respective meanings assigned to them in the Warrant Purchase Agreement, to which
reference is hereby made.

          This Warrant is subject to the following further terms and conditions:

          1.  Exercise.

          (A) Exercise Procedure; Issuance of Certificates; Payment for Shares.
This Warrant is exercisable at the option of the Holder at any time on or after
the Issue Date and prior to or on the Expiration Date for the Warrant Shares
which may be purchased hereunder.  The Company agrees that the Warrant Shares
purchased under this Warrant shall be and are deemed to be issued to the Holder
as the record owner of such shares as of the close of business on the date on
which this Warrant shall have been surrendered and payment made for such shares.
Subject to the provisions of Section 2 hereof, certificates for the Warrant
Shares so purchased, together with any other securities or property to which the
Holder is entitled upon such exercise, shall be delivered to the Holder by the
Company's transfer agent at the Company's expense as soon as reasonably
practicable after the rights represented by this Warrant have been exercised.
Each stock certificate so delivered shall be in such denominations of Warrant
Shares as may be requested by the Holder and shall be registered in the name of
the Holder.

          The Holder further agrees to comply with the provisions of Section
5(E) of the Warrant Purchase Agreement respecting any proposed exercise of this
Warrant.

          (B) Cashless Exercise of this Warrant.  The Holder may exercise its
right to receive shares of Common Stock on a net basis such that, without the
exchange of any funds and upon surrender of this Warrant, the Holder receives
shares of Common Stock equal to the value (as determined below) of this Warrant
by surrender of this Warrant to the Company at its principal offices (at the
above address) together with notice of such election, in which event

                                       2
<PAGE>

the Company shall issue to the Holder a number of shares of Common Stock
computed using the following formula:

            X = Y (A - B)
                ---------
                    A

            where:

            X = the number of shares of Common Stock to be issued to the Holder

            Y = the number of shares of Common Stock subject to this Warrant

            A = the market price of a share of Common Stock for the date of
exercise (the market price determined, for any date, as the average of the
closing prices of the Common Stock on the New York Stock Exchange (or such other
principal securities exchange or automated quotation system upon which the
Common Stock may then be listed for public trading) for the five immediately
preceding trading days on such exchange)

            B = the then current Stock Purchase Price

         2. Shares to be Fully Paid, Reservation of Shares.  The Company
covenants and agrees that all Warrant Shares which may be issued upon the
exercise of this Warrant will, upon issuance, be validly issued, fully paid and
nonassessable and free from all preemptive or any similar rights of any
stockholder of the Company and free of any liens or encumbrances arising through
the Company.  The Company further covenants and agrees that during the period
within which this Warrant may be exercised, the Company will at all times have
authorized and reserved, for the purpose of issue or transfer upon exercise of
this Warrant, a sufficient number of authorized but unissued shares of Common
Stock, when and as required to provide for the exercise of the rights
represented by this Warrant.  The Company will take all such action as may be
necessary to assure that such shares of Common Stock may be issued as provided
herein without violation of any applicable law or regulation, or of any
requirements of any domestic securities exchange or automated quotation system
upon which the Common Stock may be listed.

         3. Adjustment of Stock Purchase Price; Number of Shares.  The Stock
Purchase Price and the number of Warrant Shares purchasable upon the exercise of
this Warrant shall be subject to adjustment from time to time upon the
occurrence of certain events described in this Section 3; provided, however,
that if a certain event shall cause the Stock Purchase Price to be adjusted to a
price less than the par value of the Common Stock, the Company prior to such
event shall decrease the par value of the Common Stock so that the Stock
Purchase Price shall not be less than the par value of the Common Stock
following the occurrence of such event.

          (A) Adjustment for Dividends of Common Stock, etc..  In the event that
the Company at any time or from time to time after the issuance of this Warrant
shall declare or pay, without consideration, any dividend on the Common Stock
payable in Common Stock or in any right to acquire Common Stock for no
consideration, or shall effect a subdivision of the outstanding shares of Common
Stock into a greater number of shares of Common Stock (by stock split,
reclassification or otherwise than by payment of a dividend in Common Stock or
in

                                       3
<PAGE>

any right to acquire Common Stock), or in the event the outstanding shares of
Common Stock shall be combined or consolidated, by reclassification or
otherwise, into a lesser number of shares of Common Stock, then the Stock
Purchase Price in effect immediately prior to such event shall, concurrently
with the effectiveness of such event, be proportionately decreased or increased,
as appropriate.  In the event that the Company shall declare or pay, without
consideration, any dividend on the Common Stock payable in any right to acquire
Common Stock for no consideration, then the Company shall be deemed to have made
a dividend payable in Common Stock in an amount of shares equal to the maximum
number of shares issuable upon exercise of such rights to acquire Common Stock.
Upon each adjustment of the Stock Purchase Price pursuant to this Section 3(A),
the Holder of this Warrant shall thereafter be entitled to purchase, at the
Stock Purchase Price resulting from such adjustment, the number of shares of
Common Stock obtained by multiplying the Stock Purchase Price in effect
immediately prior to such adjustment by the number of shares of Common Stock
purchasable pursuant hereto immediately prior to such adjustment, and dividing
the product thereof by the Stock Purchase Price resulting from such adjustment.

          (B) Adjustments for Reorganization, Reclassification, Consolidation,
Merger or Sale.  If any capital reorganization or reclassification of the
capital stock of the Company, or any consolidation or merger of the Company with
another corporation, or the sale of all or substantially all of its assets to
another corporation shall be effected (other than as provided for in Section
3(A)) in such a way that holders of Common Stock shall be entitled to receive
cash, stock, securities or assets with respect to or in exchange for Common
Stock, then, as a condition of such reorganization, reclassification,
consolidation, merger or sale, lawful and adequate provisions shall be made
whereby the Holder shall thereafter have the right to purchase and receive upon
the basis and upon the terms and conditions specified in this Warrant upon
exercise of this Warrant and in lieu of the shares of the Common Stock of the
Company immediately theretofore purchasable and receivable upon the exercise of
the rights represented hereby, such cash, shares of stock, securities or assets
as may be issued or payable with respect to or in exchange for a number of
outstanding shares of Common Stock equal to the number of shares of such Common
Stock immediately theretofore purchasable and receivable upon the exercise of
the rights represented hereby, and in any such case appropriate provision shall
be made with respect to the rights and interest of the Holder that the
provisions thereof shall hereafter be applicable, as nearly as may be, in
relation to any shares of cash, stock, securities or assets thereafter
deliverable upon the exercise hereof.

          (C) Notice of Adjustment.  Upon any adjustment of the Stock Purchase
Price or any increase or decrease in the number of shares of Common Stock
purchasable upon the exercise of this Warrant, the Company shall within ten
business days give written notice thereof, by first class mail, postage prepaid,
addressed to the Holder at the address of the Holder as shown on the books of
the Company.  The notice shall be signed by the Company's chief financial
officer and shall state the Stock Purchase Price resulting from such adjustment
and the increase or decrease, if any, in the number of shares purchasable at
such price upon the exercise of this Warrant, setting forth in reasonable detail
the method of calculation and the facts upon which such calculation is based.

          4.  Issue Tax.  The issuance of certificates in the name of the Holder
for the Warrant Shares upon the exercise of this Warrant shall be made without
charge to the Holder of

                                       4
<PAGE>

this Warrant for any issue tax in respect thereof. Notwithstanding the
foregoing, the Holder shall be responsible for payment of all stock transfer
taxes, if any, in respect of any transfer of this Warrant or any Warrant Shares.

          5.  No Voting or Dividend Rights; Limitation of Liability.  Nothing
contained in this Warrant shall be construed as conferring upon the Holder
hereof the right to vote or to consent or to receive notice as a stockholder in
respect of meetings of stockholders for the election of directors of the Company
or any other matters or any rights whatsoever as a stockholder of the Company.
Except for the adjustment to the Stock Purchase Price pursuant to Section 3(A)
hereof in the event of a dividend on the Common Stock payable in shares of
Common Stock, no dividends or interest shall be payable or accrued in respect of
this Warrant or the interest represented hereby or the shares purchasable
hereunder until, and only to the extent that, this Warrant shall have been
exercised.

          6.  Restrictions on Transferability of Securities; Compliance With
Securities Act.

          (A) Restrictions on Transferability of the Warrant Shares.  The
Warrant Shares shall not be transferable except upon the conditions specified in
Section 5 of the Warrant Purchase Agreement.

          (B) Restriction on Transferability of this Warrant; Company Right of
First Refusal; Transfers Not Permitted to Significant Competitors of the
Company.

          (i) On and after the date hereof, this Warrant shall not be
transferable, except (a) as a whole Warrant (or whole One-half Warrant) to a
single transferee (where not more than one person or entity has a beneficial
interest in this Warrant or One-half Warrant, as the case may be), and (b) only
to a person or entity that is not a Significant Competitor (as defined below),
and (c) only upon the conditions specified in the Warrant Purchase Agreement,
which conditions are intended to ensure compliance with the provisions of the
Securities Act and applicable "blue sky" laws and (d) only in accordance with
the other provisions of this Section 6. A "Significant Competitor" is a toy
                                           ----------------------
company which has annual net sales from traditional toy products in excess of
two billion dollars (US$2,000,000,000).

          (ii) By acceptance of this Warrant, the Holder agrees to provide
to the Company five (5) business days prior written notice of the Holder's
intention, directly indirectly, to sell, offer or contract to sell, pledge or
otherwise dispose or transfer (collectively, a "transfer") this Warrant, which
                                                --------
notice shall include (a) the identity, in reasonable and specific detail, of the
proposed direct or indirect transferee (including, if the proposed transferee is
a broker or dealer, the identity, in reasonable and specific detail, of any
subsequent transferee to whom such broker or dealer intends or expects to
transfer this Warrant following its receipt hereof), (b) a copy of a binding
agreement (subject only to the Company's right of first refusal discussed
below), executed by the Holder, as the proposed transferor, and the proposed
transferee, (c) in the event the amount of the agreed upon consideration for the
proposed sale of this Warrant is all cash (such amount, the "Warrant Transfer
                                                             ----------------
Cash Price"), the Warrant Transfer Cash Price and a certification that the
----------
Warrant Transfer Cash Price was determined on the basis of bona fide arms length
negotiations between the parties to such agreement, (d) in the event that some
or all of the

                                       5
<PAGE>

agreed upon consideration for the proposed sale of this Warrant is
property (tangible or intangible) other than cash, a reasonably specific
description of such property intended as consideration for the transfer and (e)
all other material terms of the proposed transaction (such notice shall be
referred to herein as a "Holder's Notice of Proposed Transfer of Warrant").
                         -----------------------------------------------

          (iii)  Prior to the time and date of the proposed transfer set forth
in a Holder's Notice of Proposed Transfer of Warrant, the Company may elect to
exercise a right of first refusal to purchase the Warrant at the Right of First
Refusal Price by providing the Holder with written notice of such election.  If
the Company so notifies the Holder of its election to exercise such right of
first refusal then the Company shall tender to the Holder as payment for this
Warrant a wire transfer of immediately available funds in the amount of the
Right of First Refusal Price, and the closing with respect to the purchase of
this Warrant shall occur (a) in the event the proposed consideration is all
cash, no later than ten (10) business days after the Company receives the
Holder's Notice of Proposed Transfer of Warrant and (b) in the event the
proposed consideration is other than all cash, within the later of (i) ten (10)
business days after the Company receives the Holder's Notice of Proposed
Transfer of Warrant and (ii) three (3) business days following the Company's
receipt from the investment banking firm referred to below of a letter setting
forth the price determined by such firm to be fair (including a reasonable
description of the basis for such determination) and evidence of the Holder's
payment of fees and disbursements of such investment banking firm as provided
below.  If the Company does not so notify the Holder of its election to exercise
such right of first refusal, then the Holder may transfer the Warrant on the
terms and to the persons set forth in the Notice of Proposed Transfer of Warrant
within 45 days of the date of such Notice, subject to the limitations set forth
elsewhere in this Warrant and in the Warrant Purchase Agreement.  In the event
that such transfer is not made within such 45-day period, any subsequent
transfer shall be subject to the right of first refusal contained in this
Section 5(B).  The "Right of First Refusal Price" shall be calculated as (a) in
                    ----------------------------
the event the proposed consideration is all cash, the Warrant Transfer Cash
Price or (b) in the event the proposed consideration is other than all cash, a
price determined to be fair by a nationally-recognized investment banking firm
chosen by the mutual agreement of the independent auditors of the Company and
the Purchaser (or any subsequent Holder) to value the aggregate consideration
which is the subject of such proposed transfer (provided, however, that the
Holder shall be obligated to pay all fees and disbursements of such investment
banking firm incurred in connection with such valuation and any matters related
thereto).  Notwithstanding the foregoing, in the event that the Holder intends
to transfer the Warrant to a "subsidiary" (as defined in Rule 1-02 of Regulation
S-X under the Securities Act) of Time Warner, Inc., the Company shall not be
entitled to exercise the right of first refusal to purchase the Warrant set
forth in this Section 6(b)(iii), and the Holder's Notice of Proposed Transfer of
Warrant shall not be required to include the information set forth in clauses
(c) and (d) of Section 6(B)(ii).

          (C) Restrictive Legend.  Each certificate representing this Warrant or
the Warrant Shares (collectively, the "Securities") or any other securities
                                       ----------
issued in respect of Securities upon any such stock split, stock dividend,
reclassification or reorganization shall (unless otherwise permitted by the
provisions of the Warrant Purchase Agreement) be stamped or otherwise imprinted
with a legend substantially in the following form (in addition to any legend
required under applicable federal or state securities laws or the Company's
Certificate of Incorporation):

                                       6
<PAGE>

          THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED FOR
          INVESTMENT AND HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
          1933.  THE SECURITIES MAY NOT BE SOLD OR TRANSFERRED IN THE ABSENCE OF
          REGISTRATION OR AN EXEMPTION THEREFROM.  THE SECURITIES REPRESENTED BY
          THIS CERTIFICATE AND THE RIGHTS OF THE HOLDER HEREOF ARE SUBJECT TO
          CERTAIN RESTRICTIONS ON TRANSFER AND OTHER RESTRICTIONS, AND THE
          HOLDER OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE (INCLUDING
          ANY FUTURE HOLDER) IS BOUND BY THE TERMS OF A WARRANT PURCHASE
          AGREEMENT BETWEEN THE ORIGINAL PURCHASER AND THE COMPANY (COPIES OF
          WHICH MAY BE OBTAINED FROM THE COMPANY).

          7.  Modification and Waiver.  This Warrant and any provision hereof
may be changed, waived, discharged or terminated only by an instrument in
writing signed by the party against which enforcement of the same is sought.

          8.  Notices.  Any notice, request or other document required or
permitted to be given or delivered to the Holder hereof or the Company shall be
delivered or shall be sent by certified or registered mail, postage prepaid, to
the Holder at its address as shown on the books of the Company or to the Company
at the address indicated therefor in the first paragraph of this Warrant.

          9.  Descriptive Headings and Governing Law.  The descriptive headings
of the sections and paragraphs of this Warrant are inserted for convenience only
and do not constitute a part of this Warrant.  This Warrant shall be construed
and enforced in accordance with, and the rights of the parties shall be governed
by, the laws of the State of Delaware without regard to conflict of laws.

          10.  Lost Warrants or Stock Certificates.  The Company represents and
warrants to the Holder that upon receipt of evidence reasonably satisfactory to
the Company of the loss, theft, destruction, or mutilation of any Warrant or
stock certificate and, in the case of any such loss, theft or destruction, upon
receipt of an indemnity and, if requested, bond reasonably satisfactory to the
Company, or in the case of any such mutilation upon surrender and cancellation
of such Warrant or stock certificate, the Company at its expense will make and
deliver a new Warrant or stock certificate, of like tenor, in lieu of the lost,
stolen, destroyed or mutilated Warrant or stock certificate.

          11.  Fractional Shares.  No fractional shares shall be issued upon
exercise of this Warrant.  The Company shall, in lieu of issuing any fractional
share, pay the Holder entitled to such fraction a sum in cash equal to such
fraction multiplied by the market price of the Common Stock (the market price
determined, for any date, as the average of the closing prices of the Common
Stock on the New York Stock Exchange (or such other principal securities
exchange or automated quotation system upon which the Common Stock may then be
listed for public trading) for the five immediately preceding trading days on
such exchange).

                                       7
<PAGE>

          12.  Notices of Record Date.  In the event of (A) any taking by the
Company of a record of the holders of shares of its Common Stock for the purpose
of determining the holders thereof who are entitled to receive any dividend or
other distribution, or (B) any capital reorganization of the Company, any
reclassification or recapitalization of the capital stock of the Company, any
merger or consolidation of the Company with or into any other entity (in which
the Company is not the surviving entity), or any transfer of all or
substantially all of the assets of the Company to any other person or any
voluntary or involuntary dissolution, liquidation or winding up of the Company,
the Company shall mail to the Holder of this Warrant at least ten (10) days
prior to the record date specified therein (or, if no record date is specified
with respect to any event listed in clause (B), at least ten (10) days prior to
such event), a notice specifying (i) the date on which any such record is to be
taken for the purpose of such dividend or distribution and a description of such
dividend or distribution and/or (ii) the date, if any, that is to be fixed, as
to when the holders of record of shares of Common Stock shall be entitled to
exchange their shares of Common Stock for securities or other property
deliverable upon such reorganization, reclassification, transfer, consolidation,
merger, dissolution, liquidation or winding up.

          13.  Regulatory Compliance.

          (A) The Company and the Holder hereby acknowledge that exercise of
this Warrant by the Holder is subject to receipt of all necessary governmental
consents and approvals and may subject the Company and/or the Holder to the
filing requirements of the Hart-Scott-Rodino Antitrust Improvements Act of 1976,
as amended (the "HSR Act"), and that the Holder may be prevented from acquiring
                 -------
shares of Common Stock upon exercise of this Warrant until receipt of all
necessary governmental consents and approvals and the expiration or early
termination of all waiting periods imposed by the HSR Act (collectively,
"Governmental Approvals").  Promptly following the Holders' notice of exercise
-----------------------
or other written request from the Holder, the Company and the Holder will use
their respective reasonable best efforts to make all filings necessary to obtain
all Governmental Approvals.  Notwithstanding the foregoing, neither the Company
nor the Holder of this Warrant shall be obligated to take any action to obtain
any Governmental Approvals if the taking of such action could have the direct or
indirect effect of restricting, limiting or otherwise subjecting to penalty
either the Company or the Holder of this Warrant in the ownership of their
respective assets or the conduct of their respective businesses (including,
without limitation, requiring that the Company or the Holder of this Warrant to
sell, divest or otherwise dispose of any of its assets or businesses).  Subject
to clause (B) below, if the Holder and the Company are not able to obtain all
such Governmental Approvals on or before the Expiration Date, the is Warrant
will expire on the Expiration Date.

          (B) Notwithstanding anything to the contrary contained within this
Section 13, if the Holder has requested that the Company and the Holder use
their respective reasonable best efforts to make all filings necessary to obtain
all Governmental Approvals at least six months prior to the Expiration Date (the
"Governmental Approvals Procedure"), and the necessary Governmental Approvals
 --------------------------------
have not been obtained prior to the Expiration Date (despite the Holders' and
the Company's respective reasonable best efforts to obtain such Governmental
Approvals), the Exercise Period shall be extended for a period not to exceed six
(6) months following the Expiration Date (the "Post Expiration Period") in order
                                               ----------------------
to allow for receipt of the necessary Governmental Approvals.  If the
Governmental Approvals are obtained within the Post Expiration Period but the
Holder does not deliver notice to the Company of the exercise of this

                                       8
<PAGE>

Warrant and comply with the Cashless Exercise mechanism or tender the Stock
Purchase Price in accordance herewith within ten (10) business days following
the Holder's receipt of notice of the receipt of such Governmental Approvals,
then (i) this Warrant shall expire as of the close of business of such tenth
business day following the Holder's receipt of notice of the receipt of such
Governmental Approvals and (ii) the Holder shall reimburse the Company for all
(a) filing fees and (b) all other costs and expenses (including, without
limitation, all legal expenses) incurred by the Company to obtain such
Governmental Approvals.

     IN WITNESS WHEREOF, the Company has caused this Warrant to be executed by
its officers, thereunto duly authorized this 26th day of July, 2000

                                    Mattel, Inc.

                                    /s/ Robert Normile
                                    _____________________________
                                    By:  Robert Normile
                                    Title:  Senior Vice President and
                                            General Counsel

                                       9

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