Document:

Exhibit 10.24

                       AGREEMENT FOR TRANSFER OF OWNERSHIP

      AGREEMENT dated this 8th day of June, 2000 between CP CHEMICALS, INC., a
New Jersey Corporation located at 7 Arbor Street, Sewaren, New Jersey, with a
corporate office at One Parker Plaza, Fort Lee, New Jersey (hereinafter referred
to as "Seller"), and The Township of Woodbridge, a municipal corporation of the
New Jersey, with offices at One Main Street, Woodbridge, New Jersey 07095
(hereinafter referred to as "Buyer").

      The "Buyer" and "Seller" may be collectively referred to as the Parties.

      1. PURCHASE AGREEMENT. The Seller agrees to transfer ownership to the
Buyer and the Buyer agrees to accept ownership from the Seller, in accordance
with the terms of this Agreement, the real property described in paragraph 3.A.
below, together with the buildings and all other structures and improvements
constructed thereon (hereinafter, the "Property") and including the Equipment
described in paragraph 3.B. below (hereinafter, the "Equipment"). All buildings
are transferred "as is."

      2. PURCHASE PRICE. The purchase price for the Property, Equipment and all
other rights and interests to be transferred in accordance with this Agreement
shall be One (1) ($1.00) Dollar.

      3. PROPERTY SOLD.

            A. The Property is known and designated as Block 729, Lot 3; Block
729A, Lot 1; Block 730, Lots 1 and 1B; and Block 731, Lot 1B on the tax map of
the Township of Woodbridge, County of Middlesex, State of New Jersey and
commonly known as 7 Arbor Street, Sewaren, Woodbridge Township, New Jersey (the
"Property") is shown on Exhibit A. A legal description of the Property is
annexed hereto as Exhibit B.

            B. The Equipment sold consists of all boilers presently located on
the Property, one (1) scale located in the driveway near the office building;
the guard trailer and all Equipment located in the wastewater treatment plant.
All such Equipment presently exists on the Property and is included in this
sale. Seller agrees to provide Buyer with clear title to the Equipment. All
Equipment is sold "as is".

      4. PAYMENT OF PURCHASE PRICE. The Buyer will pay the purchase price at
Closing.

      5. CASH CLOSING; NO FINANCING CONTINGENCY. The Buyer represents and
warrants to Seller that it has or will have sufficient cash at Closing to close
the within purchase on the date set forth herein for closing.

      6. TIME AND PLACE OF CLOSING. The Buyer and Seller agree to make a date no
later than June 29, 2000 as the date for Closing ("Closing Date"). The Closing
will be held at the offices of the Buyer or of the attorney for the Buyer in New
Jersey.
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      7. TRANSFER OF OWNERSHIP. At the Closing, the Seller will transfer
ownership of the Property and Equipment to the Buyer. The Seller will deliver to
Buyer at Closing:

            A.    A properly executed Deed;

            B.    A standard Affidavit of Title, as further defined below, and
                  insuring, inter alia, against mechanic's and materialman's
                  liens and stating that, to the best of Seller's knowledge,
                  there are no unrecorded interests in the Property or Equipment
                  of any kind, other than as set forth in the Agreement;

            C.    A Corporate Resolution authorizing the sale of the Property
                  and Equipment;

            D.    If requested, a FIRPTA Affidavit stating that Seller is not a
                  foreign person;

            E.    The most recent tax, water and sewer bills for the Property;

            F.    A payoff letter or release with respect to any mortgages or
                  liens encumbering the Property or the Equipment;

            G.    Any and all documents reasonably required by the Buyer's
                  attorney or title company in order to insure title;

            H.    A copy of any other document which Seller is required to
                  deliver by this Agreement and which has not been delivered;

            I.    Evidence of compliance with the Industrial Site Recovery Act,
                  N.J.S.A. 13:1K-6 et seq. in accordance with paragraph 29 of
                  this Agreement.

            J.    The Indemnification Agreement, properly executed, in the form
                  attached hereto as Exhibit C, to take effect as of the Closing
                  Date.

            K.    The Lease, properly executed, referred to in Paragraph 10 and
                  attached as Exhibit D in this Agreement, to take effect as of
                  the Closing Date.

            L.    A bill of sale for all equipment.

      8. TYPE OF DEED.

            A. Seller agrees to provide and the Buyer agrees to accept a deed
known as bargain and sale with covenants against grantor's acts, subject to
paragraph 14 and including the limitation set forth at Paragraph 44, of this
Agreement.

            B. The title to be conveyed must be marketable and insurable, by a
title insurance company authorized to do business in New Jersey. If Seller has a
copy of a previous

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title search on the Property, Seller shall provide same to Buyer within ten days
of execution of this Agreement. Seller shall, at the same time, provide Buyer
with a copy of any searches, as well as the title/registration for any Equipment
that are in Seller's possession.

      9. EXPENSES. Seller shall pay the realty transfer fee in connection with
the conveyance of the Property. Buyer shall pay for all title, survey and
inspection fees (including, without limitation, title insurance premiums, search
charges and environmental inspections, if any) incurred by it. Each Party shall
bear all other fees, charges and expenses incurred by it, including legal fees
of its counsel, without contribution from the other, except as expressly set
forth herein.

      10. CONTINGENCIES.

            A. Execution of Lease. Buyer and Seller acknowledge that the
execution of the Lease attached hereto as Exhibit D is a material inducement to
both Parties for entry into this Agreement. The execution of the Lease attached
as Exhibit D by the Township shall occur at the Closing and shall be a
contingency to the transfer of title pursuant to this Agreement. Said Lease
shall not take effect until the Closing Date.

            B. Inspections. For a period of fifteen (15) days after the date a
fully executed copy of this Agreement is delivered to all Parties (the
"Inspection Period"), the Buyer may perform a due diligence investigation of the
Property, including, but not limited to the structural integrity of the
buildings on the Property, past uses of the Property, and the environmental
conditions of the Property.

            C. Notwithstanding anything herein to the contrary, if Buyer
determines for any or no reason that it will not accept the Property in its "as
is" condition, Buyer may terminate this Agreement by providing written notice to
Seller on or before fifteen (15) days following the date this Agreement is fully
signed and delivered to all Parties.

            D. Seller shall file all applications necessary, at its sole cost
and expenses, to obtain from the New Jersey Department of Environmental
Protection (the "DEP"), "Innocent Purchaser" status for the Buyer.

            E. This Article 10 shall survive the Closing.

            F. The Parties shall use best efforts to avoid interfering with each
others use of the Property when exercising these access rights, and shall follow
the reasonable rules and regulations promulgated by the other as to areas under
their control. All such rules and regulations should be provided to the other
Party in writing.

      11. BUILDING AND ZONING LAWS. The Seller, to the best of its knowledge,
states that the Property is in an industrial zone. If the Property cannot be
used as an auto impound yard and as a testing laboratory, the Buyer shall have
the right to terminate this Agreement during the Inspection Period described
above at Paragraph 10.B.

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      12. FLOOD AREA. The federal and state governments have designated certain
areas as "flood areas." Seller and Buyer acknowledge that the Property is
located in a flood area. See Exhibit A. Buyer shall secure its own flood
insurance at its option.

      13. ACCESS.

            A. Seller's Post Closing Access. The Buyer agrees that Seller shall
have a post Closing right of access as more specifically described in the Lease,
Exhibit D, to this Agreement, subject to the reasonable rules and regulations
established by the Seller from time to time. Buyer also agrees that Seller shall
have a right of access to the Property for the purpose of conducting remedial
investigation and/or remedial action consistent with Seller's obligation under
this Agreement and consistent with Seller's Environmental Obligations as defined
in the Lease, Exhibit D. Seller and Buyer agree that Seller's post Closing
access rights shall also be memorialized in a form of easement, the terms which
shall be agreeable to both Parties. This right shall extend to Seller's agents,
representatives and consultants. Before entering the Property, the Seller shall
deliver to the Buyer certificates of insurance.

            B. Buyer's Post Closing Access. Seller and Buyer agree that Buyer
shall have access to the area leased by Seller pursuant to the terms of the
Lease attached as Exhibit D. This right shall extend to Seller's agents,
representatives and consultants.

            C. This Article 13 shall survive the Closing.

            D. The Parties shall use best efforts to avoid interfering with each
others use of the Property when exercising these access rights, and shall follow
the reasonable rules and regulations promulgated by the other as to areas under
their control. All such rules and regulations shall be provided to the other
Party in writing.

      14. OWNERSHIP. The Seller agrees to transfer and the Buyer agrees to
accept title to the Property free of all claims and rights of others, except for
the following, provided that such exceptions would not render title unmarketable
nor uninsurable as provided herein:

            A. Deed Notice contained in Deed Book 04643P, Pages 236 through 258.

            B. Administrative Consent Order contained in Deed Book 390, Pages 30
through 130.

            C. Possible title claim or riparian rights in State of New Jersey if
Property were ever flowed by tidewaters.

            D. The rights of utility companies to maintain pipes, poles, cables
and wires over, on and under the Property.

            E. Any other restrictions of record provided: (a) restrictions are
not now violated; and (b) violation of such restrictions will not cause a
forfeiture or reversion of title.

            F. Such facts as an accurate survey may disclose, provided that
title to the Property is insurable as provided herein.

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      15. RISK OF LOSS. Prior to Closing if there is any damage, Seller shall,
at its discretion, have three options: (a) request that Buyer accept the
Property in its damaged condition with an agreed upon adjustment at Closing; (b)
repair the damage within a reasonable period of time after the date of the
casualty but prior to Closing; or (c) terminate the Agreement. If Seller elects
option (a), Buyer may terminate the Agreement or, if Buyer accepts Seller's
election, the Parties will mutually agree on an adjustment at Closing.

      16. ASSESSMENTS FOR MUNICIPAL IMPROVEMENTS. Certain municipal improvements
such as sidewalks may result in the municipality charging property owners to pay
for the improvements. Seller represents that to the best of its knowledge there
are no pending or forthcoming governmental improvements. All unpaid charges
(assessments) against the Property for work completed before the closing will be
paid by the Seller at or before the closing. If the improvement is not completed
before the closing, then only the Buyer will be responsible. If the improvement
is completed but the amount of the charge (assessment) is not determined, the
Seller will pay an estimated amount at the closing. When the amount of the
charge is finally determined, the Seller will pay any deficiency to the Buyer
(if the estimate proves to have been too low), or the Buyer will return any
excess to the Seller (if the estimate proves to have been too high).

      17. ADJUSTMENTS AT CLOSING.

            A. At Closing, the Buyer and the Seller shall adjust for sewer
charges and water charges and any other adjustments provided for in this
Agreement on the Property as of the Closing Date.

            B. At Closing, the Buyer and the Seller shall adjust for real estate
taxes as of the day of Closing.

            C. The present insurance coverage and public utility service on the
Property shall be terminated as of the Closing Date, and there shall be no
proration of insurance premiums or public utility bills. Seller shall fully pay
for its insurance and utilities. Seller shall be entitled to receive any rebates
related to the present insurance coverage and any utility deposit held by or for
the benefit of Seller in connection with any such utility service, if any.

            D. Seller shall remain responsible for all remaining installments of
payment due under the March 1991 Administrative Consent Order. This obligation
shall survive closing of title.

      18. POSSESSION AND OCCUPANCY.

            A. At the closing the Buyer shall be entitled to possession and no
other individual or entity shall have any occupancy rights, except as may
otherwise be provided for in the Lease between Buyer and Seller attached as
Exhibit D or as set forth herein. Except as provided herein, the Property shall
be in broom-clean condition.

            B. Buyer grants the Seller the right to leave equipment listed on
Exhibit E (the "Seller's Equipment") in place. The Seller's Equipment shall
remain the property of Seller. Buyer shall grant the Seller reasonable access to
the Seller's Equipment for the purposes of

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showing the Seller's Equipment for sale, and for removing the Seller's
Equipment. The Seller shall relocate the Seller's Equipment after reasonable
notice from the Buyer, if the Buyer needs the space. Seller shall repair any
damage caused by the removal of the Seller's Equipment. All Seller's Equipment,
except the spray dryer, will be removed from the Property within three (3)
years. The Seller shall use commercially reasonable efforts to remove the spray
dryer as soon as possible. The Buyer shall not be responsible for any loss or
damage to the Seller's Equipment. This Paragraph shall survive closing of title.

      19. RIGHT OF WAYS. Seller has not granted any right of ways or easements,
except as disclosed in this Agreement, to any party.

      20. PARTIES LIABLE. This Agreement is binding upon all Parties who sign it
and all who succeed to their rights and responsibilities.

      21. RECORDING AND NO SURVIVAL.

            A. Neither this Agreement, nor a memorandum thereof, shall be
recorded in any place of public record by Seller or Buyer. Buyer may file a
Notice of Settlement.

            B. Except as otherwise provided, none of the provisions of this
Agreement shall survive the delivery of the Deed.

      22. NOTICES. All notices under this Agreement must be in writing. The
notices must be delivered by nationally recognized overnight carrier; one day
U.S. Post Office delivery; mailed by certified mail, return receipt requested;
or receipted personal delivery to the Seller at the address written in this
Agreement, Attention: Thomas L. Moran, with a copy to Margaret B. Carmeli, Esq.,
Giordano, Halleran & Ciesla, 125 Half Mile Road, P.O. Box 190, Middletown, New
Jersey 07748 (fax: 732-224-6599) and to Buyer at the address written in this
Agreement, Attention: Business Administrator, with a copy to Director of Law at
the address written in this Agreement. This provision shall survive the Closing.

      23. DEFECTS IN TITLE. If the Seller shall be unable, at the time fixed for
closing of title, to convey good and marketable title subject to and in
accordance with this Agreement, the Seller is obligated to initiate steps to
remove forthwith any defects. If, for any reason, such defects cannot be
removed, or should Seller elect not to remove any such defects within forty-five
(45) days from its receipt of notice of the existence of such defects, then the
sole obligation of Seller shall be to notify Buyer in writing that the Agreement
is terminated. Upon the making of such notice, this Agreement shall wholly cease
and terminate and neither Party shall have any further claim against the other
by reason of this Agreement. The Buyer may nevertheless, accept such title as
the Seller may be able to convey without reduction of the purchase price or any
credit or allowance against the same and without any other liability on the part
of Seller, or may extend the date to remove any defects.

      24. ASSIGNMENT. This Agreement may not be assigned by either Party without
the written consent of the other Party.

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      25. BROKER. Each Party represents and warrants to the other Party that
such Party has not dealt with a broker or brokers in respect of the transaction
contemplated by this Agreement. This provision shall survive Closing or
termination of the Agreement.

      26. SELLER'S COVENANTS. In addition to the covenants and representations
of this Agreement, Seller covenants that it will do the following:

      Seller will maintain the physical condition of the Equipment and Property,
including the grounds and all other elements of the Property and operate the
Property, in the same condition in which it presently exists through the Closing
Date, reasonable wear and tear excepted. Seller will make all ordinary and
normal repairs and maintenance of the Property from the date hereof until
Closing.

      27. EMINENT DOMAIN. Seller shall give Buyer prompt notice of any actual or
threatened taking or condemnation of all or any portion of the Property. In the
event that, prior to Closing, all or any portion of the Property, or the loss of
use of which would impair the overall use of the Property is taken by eminent
domain or notice of such taking is received by Seller, this Agreement may be
canceled at Buyer's option, upon which neither party shall have any rights or
obligations to the other. Should Buyer elect to proceed to Closing, then Seller
shall assign any interest in any sums payable or credit any sums paid as an
adjustment. Seller shall not adjust or settle any condemnation award without
prior written approval of Buyer which approval shall not be unreasonably
withheld or delayed. The provision shall survive the Closing.

      28. SELLER'S REPRESENTATIONS. Seller hereby represents to Buyer, each of
which representations shall be true at and shall survive Closing, as follows:

            A. Existence. Seller is a New Jersey corporation duly organized and
validly existing in good standing under the laws of the State of New Jersey and
has all requisite power and authority to consummate the transactions
contemplated hereunder and has made proper corporate proceedings, duly
authorized the execution and delivery of this Agreement and the consummation of
all transactions contemplated hereunder.

            B. Execution and Performance. The execution and performance of this
Agreement shall not be a breach or violation of any Agreement to which the
Seller is a party.

            C. Joinder. All persons or entities having a legal or equitable
title or interest in the Property (or whose joinder in the Deed would be
necessary to convey to Buyer title to the Property as provided in Section 15
hereof) have been identified herein and have executed this Agreement as
"Seller."

            D. No Rights to Acquire. No person or entity other than Buyer, or
its assignee, has any right or option to acquire the Property or any portion
thereof.

            E. Fire and Casualty Damage. As of the date of this Agreement, no
portion of the Property or any improvements thereof have been damaged or
destroyed by fire or other casualty which have not been fully restored.

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            F. Condemnation. Seller has not heretofore received any notice or
communications from any governmental unit or other body having the power of
eminent domain of any pending or threatened condemnation proceeding or other
proceedings in the nature of eminent domain in connection with the Property or
any part thereof, nor are any such proceedings pending to the best of Seller's
knowledge.

            G. F.I.R.P.T.A. Representations. Pursuant to Section 1445 of the
United States Internal Revenue Code, the Seller represents that it is not a
foreign corporation, foreign partnership, foreign trust, or foreign estate (as
those terms are defined in the U.S. Internal Revenue Code and Income Tax
Regulations). Seller further represents that its U.S. employer identification
number is 22-154-8721 and that its office address is 7 Arbor Street, Sewaren,
New Jersey. Seller agrees to provide to Buyer at closing an affidavit containing
all information required by Section 1445 of the U.S. Internal Revenue Code and
regulations pursuant thereto if requested by Buyer two (2) weeks before closing.

            H. Ownership. Based on the title policy issued at the time of
acquisition of the Property, the Seller is the owner of good and marketable
title to the Property.

            I. Adverse Possession. Seller has not acquired title to the Property
by adverse possession.

            J. Taxes and Utilities. Seller has paid real property taxes, sewer
charges, water bills and utilities on the Property.

            K. Leases. Seller represents that there are no leases, tenants or
other occupants respecting the Property, except as set forth in Paragraph 10.

            L. The Private Road. The private road which is on the property of
Shell Oil Company, ends at the boundary line of the Property. Shell Oil Company
is responsible for maintenance of the road, including repairs and snow plowing.
There are no restrictions governing the use of the road.

      29. ENVIRONMENTAL CONDITIONS.

            A. Buyer and Seller acknowledge that the sale of the Property may be
subject to compliance with the Industrial Site Recovery Act, N.J.S.A. 13:1K-6 et
seq., the regulations promulgated thereunder and any amending or successive
legislation and regulations ("ISRA"). No later than five (5) days from the
execution of this Agreement by the last Party to sign, Seller shall submit to
the New Jersey Department of Environmental Protection ("DEP") a General
Information Notice form, Amended General Information Notice form, Applicability
Determination or the equivalent. Seller shall provide Buyer with evidence of
compliance with ISRA at Closing which may include, at Seller's election, a
Remediation Agreement, Amended Administrative Consent Order or the equivalent; a
Non-Applicability Determination; a No Further Action Determination or any
combination thereof. Buyer agrees to waive its right, if any, to vacate this
transaction under ISRA, as a result of any violation of ISRA by Seller, provided
Seller complies with this section A. This section shall survive the closing of
title.

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            B. Buyer acknowledges that the Property is currently the subject of
a Deed Notice that contains in Deed Book 04643P, Page 236 to 258 and agrees to
take title subject to all restrictions imposed therein. Buyer also agrees to
allow Seller to record any modifications to that Deed Notice approved by DEP.
Buyer further agrees to comply with all requirements set forth in the recorded
Deed Notice. This section shall survive the closing of title.

            C. The Buyer shall accept responsibility for any
investigation/remediation required as a result of Buyer's activities on the
Property subsequent to closing. This section shall survive the closing of title.

            D. Buyer further advises that it has been provided with a copy of
the Administrative Consent Order (the "ACO") between CP Chemicals and the DEP
and is aware of the obligations imposed thereunder. The Seller shall be
responsible for complying with all obligations under the ACO except as provided
herein.

            E. Post Closing, Buyer shall maintain the Groundwater Recovery
System and the treatment plant on the Property. Seller shall make its Operations
Personnel available to Buyer without cost to the Buyer for a period of sixty
(60) days after closing of title to train Buyer's personnel in the operations of
all equipment at the Property.

            F. Buyer agrees that it will obtain all necessary permits and
approvals for its use of the Property. Buyer agrees that, commencing on the
Closing Date, it will operate and maintain the Groundwater Recovery System as
defined in Exhibit F. This section shall survive the closing of title.

            G. Both Parties agree to provide the other with a copy of all
documents sent to or received from the DEP within ten (10) business days of
receipt or mailing. This section shall survive the closing of title.

            H. Buyer agrees to provide security to prevent unauthorized entry
onto the Property for the term of the Lease and thereafter until Seller advises
Buyer that such measures are no longer required, in accordance with the
requirement of Seller's facility permit issued pursuant to the Resource
Conservation and Recovery Act.

            I. Seller shall maintain all financial assurances which may be
required by the DEP and which may be adjusted from time to time by the DEP, at
anytime, as a result of Seller's responsibilities pursuant to this Agreement.
This paragraph shall survive the closing of title.

      30. OBLIGATIONS OF BUYER TO REPORT TRANSACTION-1986 TAX REFORM ACT. Buyer
hereby acknowledges and agrees that it shall assume all responsibility for
compliance with the transaction reporting requirements of the 1986 Federal Tax
Reform Act.

      31. BUYER REPRESENTATIONS. Buyer hereby represents to Seller, each of
which representations shall be true at Closing, as follows:

            A. Buyer has all requisite power and authority to consummate the
transaction contemplated hereunder and has undertaken proper proceedings to duly
authorized the execution

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and delivery of this Agreement and the consummation of all transactions
contemplated hereunder.

            B. The execution and performance of this Agreement shall not be a
breach or violation of any agreement to which the Buyer is a Party.

      32. BREACH OF CONTRACT. Seller's damages in the event of a breach by Buyer
shall be limited to termination of the Agreement. Buyer's damages in the event
of a breach by Seller shall be limited to termination of the Agreement.

      33. ENTIRE AGREEMENT. This Agreement and its Exhibits contains the entire
agreement between the Parties, and no agent, representative, or officer of the
Parties hereto has authority to make or has made any statement, agreement or
representation, either oral or written in connection herewith modifying, adding
to or changing the terms set forth herein. No modification of this Agreement
shall be binding unless such modification shall be in writing and signed by both
Parties.

      34. CONSTRUCTION. The Buyer and the Seller agree that each Party and its
counsel have reviewed and revised this Agreement and that the normal rule of
construction to the effect that any ambiguities are to be resolved against the
drafting party shall not be employed in the interpretation of this Agreement or
any amendments, exhibits or schedules hereto.

      35. EXECUTION. This Agreement may be executed in any number of
counterparts, each of which when so executed and delivered, shall be deemed an
original, but such counterparts together shall constitute but one and the same
instrument.

      36. HEADINGS. The section headings herein are for convenience only and
shall not be construed to limit or affect any provisions of this Agreement.

      37. SEVERABILITY. In the event that any one or more of the provisions of
this Agreement shall be determined to be devoid or unenforceable by a court of
competent jurisdiction, or by law, such determination will not render this
Agreement invalid or unenforceable and the remaining provisions hereof shall
remain in full force and effect.

      38. CONTRACT DATE/EFFECTIVE DATE. "Contract Date" and "Effective Date"
shall be defined as the day on which a fully executed Agreement for Transfer of
Real Estate is received by the Buyer or Buyer's attorney.

      39. GOVERNING LAW. This Agreement and all other documents shall be
governed by and construed in accordance with the laws of the State of New Jersey
and without reference to conflicts of law. In the event that the Seller or Buyer
brings any action hereunder in any state or federal court in New Jersey, the
Seller or Buyer consents to and confers jurisdiction by such court or courts.

      40. INDEMNIFICATION.

            A. Buyer hereby releases, holds harmless and agrees to defend and
indemnify Seller with respect to all actions, causes of action, obligations,
expenses, liabilities, losses,

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penalties, fines, fees (including counsel fees and reasonable costs of
investigation and defense) and costs, claims, suits and damages for personal
injury, property damage and violation of any federal, state, county or local
law, statute, regulation, rule or ordinance which Seller may incur, pay out, be
exposed to and/or otherwise be responsible for which arises from or is related
to the Property including without limitation as a result of the presence of any
Hazardous Materials (as defined hereinafter) and/or violation of any
Environmental Law (as defined hereinafter), any conduct, inaction, condition or
discharge that: (1) occurs after the Closing Date, except as a result of the
presence of any Hazardous Materials (as defined hereafter) and/or the violation
of any Environmental Law, as hereinafter defined, which condition or event
occurred prior to the Closing Date; or (2) arises or is related to the operation
and maintenance or failure to operate and maintain the Groundwater Recovery
System on or after the Closing Date.

            B. Seller hereby releases, holds harmless and agrees to defend and
indemnify Buyer with respect to all actions, causes of action, obligations,
expenses, liabilities, losses, penalties, fines, fees (including counsel fees
and reasonable costs of investigation and defense) and costs, claims, suits and
damages for personal injury, property damage and violation of any federal,
state, county or local law, statute, regulation, rule or ordinance which may
incur, pay out, be exposed to and/or otherwise be responsible for which arises
from or is related to the Property including without limitation as a result of
the presence of any Hazardous Materials (as defined hereinafter) and/or
violation of any Environmental Law (as defined hereinafter), any conduct,
inaction, condition or discharge that: (1) occurred prior to the conveyance of
the Property pursuant to this Agreement, (2) is a result of the presence of any
Hazardous Materials (as defined hereafter) and/or violation of any Environmental
Law (as defined hereafter) on or before the Closing Date, or (3) occurs as a
result of Seller's post Closing activities on the Property.

            C. As used in this Agreement, "Hazardous Material" if any hazardous
waste or hazardous substance as defined in any Environmental Law. As used in
this Agreement, "Environmental Law" means any and all laws relating to the
protection of the environment, human health and safety of any environmental
activity including federal, state, county, city and municipal environmental
clean up statute, law, rule, regulation or ordinance, decree or interpretation.

            D. This Paragraph shall survive the Agreement.

            E. The indemnification provided for herein shall not be assigned by
either Party.

      41. CONFIDENTIAL INFORMATION. Except as precluded by applicable law, any
Party may designate any data, information, reports, or documents provided to the
other as "Confidential Information." The provisions of this Agreement constitute
Confidential Information. Except as required by applicable law or action of
governmental agent acting under color of authority, neither Party shall, without
the prior written consent of the other Party, disclose any Confidential
Information to any third party.

      42. COOPERATION. The Parties agree to cooperate with respect to the
execution of documents and/or applications as may be necessary. The Party from
whom signature is sought shall be provided a reasonable opportunity to review
and comment upon any documents.

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      43. SUCCESSORS AND/OR ASSIGNS. The covenants, conditions and agreements in
this Agreement shall bind and inure to the benefit of Seller and Buyer and,
except as provided in this Agreement, their respective permitted successors and
assigns.

      44. LIMITATION ON FURTHER CONVEYANCE. Buyer acknowledges that a mutual
inducement for Seller's entry into this Agreement is Buyer's agreement not to
convey, either by instrument or operation of law, the to Property subject to
this Agreement, except to another public entity of the State of New Jersey.
Buyer agrees that the deed of conveyance and if requested by Seller, a separate
recordable instrument, shall contain a provision restricting Seller from
conveying the Property, in whole or in part, except to another public entity of
the State of New Jersey, until such time as Seller has received a site-wide No
Further Action Determination without conditions and has no affirmative
obligation of any kind with respect to the Property by reason of environmental
conditions.

                                       12
<PAGE>

SIGNED AND AGREED TO BY:

Attest:                 Date Signed:   TOWNSHIP OF WOODBRIDGE

/s/                     6/8/00         By /s/
---------------------   -----------       --------------------------------------
John M. Mitch                             James E. McGreevey, Mayor
Municipal Clerk

                                       CP CHEMICALS, INC.

                                       Seller

ATTEST:

/s/                     4/18/00        By /s/
----------------------  -----------       --------------------------------------
Secretary                                 Senior Vice President &
                                          Chief Regulatory Officer
<PAGE>

                                    Exhibits*

Exhibit A - Property Location
Exhibit B - Legal Description
Exhibit C - Indemnification Agreement
Exhibit D - Lease
Exhibit E - Equipment List
Exhibit F - Description of Groundwater Recovery System
            Appendix 1 - As-Built Site Plan - 1 of 3 and Details - 2 of 6
            prepared by Sadat Associates, Inc.
            Appendix 2 - Wastewater Treatment Plant Layout - 2 of 3 and
            Wastewater
            Treatment Plant P& I - 3 of 3 prepared by Sadat Associates, Inc.
            Appendix 3 - Indirect Discharge Permit
            Appendix 4 - Deed Notice
            Appendix 5 - Easement

* Exhibits omitted

                                       14
<PAGE>

                     ENVIRONMENTAL INDEMNIFICATION AGREEMENT

      CP Chemicals, Inc. a corporation organized under the laws of the State of
NewJersey ("Indemnitor"), in consideration of the agreement for Transfer of
Ownership (the "Agreement") by the Township of Woodbridge (the "Township" or
"Indemnitee"), and for other good and valuable consideration, receipt of which
is hereby acknowledged, represents, agrees and covenants, as follows:

      1. Except as otherwise provided, defined terms shall have the same meaning
as in the Agreement for Transfer of Ownership to which this document is an
Exhibit and the Lease between CP Chemicals, Inc. and the Township of Woodbridge.

      2. This Indemnification Agreement shall supplement, but not supercede
Paragraph 40 of the Agreement.

      3. Indemnitor hereby releases, holds harmless and agrees to defend and
indemnify the Township with respect to all actions, causes of action,
obligations, expenses, liabilities, losses, penalties, fines, fees (including
counsel fees and reasonable costs of investigation and defense) and costs,
claims, suits and damages for personal injury, property damage and violation of
any federal, state, county, or local law, stature, regulation, rule or ordinance
which may incur, pay out, be exposed to and/or otherwise be responsible
("claim") for which arises from or is related to the Property including without
limitation as a result of the presence of any Hazardous Materials and/or
violation of any Environmental Law, any conduct, inaction, condition or
discharge that: (i) occurred prior tot he conveyance eof the Property pursuant
to the Agreement, (ii) is a result of the presence of any Hazardous Materials
and/or violation of any Environmental Law on or before the Closing Date
notwithstanding the date of the damage, injury or loss, (iii)
<PAGE>

occurs as a result of Indemnitor's post Closing activities in the Property, (iv)
or is a breach of Indemnitor's representations, warranties or covenants
respecting the environmental condition of the Property made herein (collectively
"Environmental Losses"). The Township agrees to provide Indemnitor with
reasonable notice of its intent to seek indemnification pursuant to thus
Paragraph 3. Indemnitor may elect to defense any claim with counsel of its
choosing provided said counsel is reasonably acceptable to the Township.

      4. Indemnitor hereby agrees to defend, hold harmless and indemnify the
Township against all Environmental Losses, including, but not limited to, all
Environmental Losses arising or resulting from actions that: (i) occurred prior
to the conveyance of the Property pursuant to the Agreement, (ii) is a result of
the presence of any Hazardous Materials and /or violation of any Environmental
Law on or before the Closing Date notwithstanding the date of the damage, injury
or loss, (iii) occurs as a result of Indemnitor's post Closing activities on the
Property, (iv) Indemnitor or any prior owner, tenant or occupant of the Property
caused or suffered including a spill, leak, pumping, pouring, emission,
emptying, discharge, injection, escape, leaching, dumping or disposal in the
environment of any Hazardous Substance, oil or petroleum (any of the foregoing
being a "Release") at, upon, under or within the Property in connection with
their operations on the Property or any contiguous real estate; (v) involved
Indemnitor or any prior owner, tenant or occupant with respect to operations at
the Property which lead or could lead to the creation of a lien on such Property
under the Environmental Law; or (vi) permitted by Indemnitor or any prior owner,
tenant or occupant of the Property with respect to any tenant or occupant of the
Property to engage in any activity that could lead to the creation of a Lien on
the Property, under the Environmental Law. The Township agrees to provide
Indemnitor with reasonable notice of its intent to seek indemnification pursuant
to this Paragraph 4. Indemnitor

                                       2
<PAGE>

may elect to defend any claim with counsel of its choosing provided said counsel
is reasonably acceptable to the Township.

      5. This indemnity encompasses all Environmental Losses, whether
foreseeable or unforeseeable, direct or consequential, actual or threatened,
including, without limitation, the cost of any required or necessary in section,
audit, cleanup, detoxification or similar action, and the preparation of any
closure or other required plans, consent orders, license applications or similar
processes.

      6. Indemnitor agrees the environmental Losses shall include, without
limitation: (I) any loss or damage suffered by the Township, even if the claim
or suit resulting in such loss is ultimately determined to be false, or (ii) any
liability of Township for damages resulting from the personal injury or death of
any Person, and notwithstanding the fact that Indemnitor has paid, or is
obligated to pay, such Person (or his/her survivors) under the worker's
compensation laws of the State of New Jersey, or any other similar law for the
protection of employees.

      7. This indemnity is an original obligation of Indemnitor and is an
absolute, unconditional, unlimited, continuing and irrevocable indemnity for
Environmental Losses and shall remain in full force and effect without respect
to the future changes and conditions, including changes of law or any invalidity
or irregularity with respect to this Indemnification Agreement.

      8. This Indemnification Agreement shall continue in full force and effect
and shall not expire. This Indemnification Agreement shall not be discharged or
affected by the dissolution, amalgamation, any change in the name, business,
membership, directorate, powers, partnership, corporate or other business form,
winding -up proceedings, proceedings under the Bankruptcy

                                       3
<PAGE>

Code, liquidation, receivership proceedings, the appointment of a receiver or
other insolvency proceedings occurring in respect of Indemnitor.

      9. Indemnitor further agreements that the Township shall not be obligated
to resort to or exhaust any recourse which Township may have against any other
source in respect of any Environmental Losses (such surety and Persons being
hereinafter "Third Party Obligor") or against any security therefor before being
entitled to claim against Indemnitor. The liability of Indemnitor shall be
continuing and enforceable by the Township against Indemnitor with respect to
each and every occurrence of Environmental Loss, and nothing shall prevent the
ownership, in its sole discretion, from resorting to recourse from other sources
first should it so elect.

      10. No delay on the part of Township in the exercise of any right or
remedy shall operate as a waiver thereof, and no single or partial exercise by
Township of any right or remedy shall preclude any further exercise thereof; nor
shall any modification or waiver of any of the provisions of this
Indemnification Agreement be binding upon township, except as expressly set
forth in writing duly signed and delivered on behalf of Township by an
authorized officer or agent. Any failure on the part of Township at any time or
times hereafter to require strict performance by Indemnitor or any Third Party
Obligor in respect of any Environmental Loss, shall not waive, affect or
diminish any right township may have at anytime or times hereafter to demand
strict performance thereof, and such right shall not be deemed to have been
waived by any act, failure to act or knowledge on the part of any of its agents,
officers or employees of Township, unless such waiver is contained in an
instrument in writing signed by such officer or agent or employee and directed
to Indemnitor or any third Party Obligor, as may be required, specifying such
waiver. No waiver by Township of any default shall operate as a waiver of any

                                       4
<PAGE>

other default or the same default on a future occasion, and no action on the
part of Township permitted hereunder shall in any way affect or impair the
rights of Township or the obligations of Indemnitor under this Indemnification
Agreement.

      11. This Indemnification Agreement is independent of, and in addition to,
any and all rights of Township against any other Person.

      12. This Indemnification Agreement shall be construed in accordance with
the laws of the State of New Jersey. Indemnitor hereby agrees that all actions
or proceedings arising directly or indirectly hereunder may, at Township's
option, be litigated in Courts having situs within the State of New Jersey, and
Indemnitor hereby expressly consents to the jurisdiction of any local, state or
federal court located within such State, and consents that any service of
process in such action or proceeding may be made by personal service or process
upon Indemnitor where Indemnitor may be then located or by certified or
registered mail directed to Indemnitor at the address set forth below its
signature on the last page of this Indemnification Agreement or such other
address as Indemnitor has notified Township of in writing.

      13. In the event that any provision or any part of any provision of this
Indemnification Agreement is deemed to be invalid by reason of the operation of
any law or by reasoning of the interpretation placed thereon by a court, this
Indemnification Agreement shall be construed as not containing such provision or
the remainder of such provision, and all of the provision and remainders of
provisions hereof which are otherwise lawful and valid shall remain in full
force and effect.

                                       5
<PAGE>

      14. Without limiting the generality of any other provision of this
Indemnification Agreement, each and every right, remedy and power hereby granted
to Township or allowed Township by law or other agreement in respect of
Indemnitor shall be cumulative and not exclusive of any other and may be
exercised by Township at any time and from time to time.

      15. This Indemnification Agreement shall be binding upon Indemnitor and
successors and assigns.

      16. Indemnitor hereby certifies that it has all necessary authority to
grant and execute this Indemnification Agreement.

      17. This Indemnification Agreement is not assignable.

      18. The parties agree that there are no third party beneficiaries to this
Indemnification Agreement.

      19. This Indemnification Agreement may be signed in counterparts.

      20. This Indemnification Agreement shall be executed by the Township on
the Closing Date, shall not take effect until the Closing date and shall be
considered null, void and of no effect in the event that Closing and transfer of
title does not occur pursuant to the Agreement.

                                       6
<PAGE>

      IN WITNESS WHEREOF, Indemnitor has executed this Indemnity Agreement this
______________ day of ______, 2000.

Attest:                 Date Signed:    TOWNSHIP OF WOODBRIDGE

/s/                     6-8-00          By /s/
----------------------  -----------        -------------------------------------
John M. Mitch                              James E. McGreevey, Mayor
Municipal Clerk

                                        CP CHEMICALS, INC.

Attest:

/s/                     4/18/00         By /s/
----------------------  -----------        -------------------------------------
Secretary                                  Senior Vice President &
                                           Chief Regulatory Officer
<PAGE>

                                       LEASE

LANDLORD                               TOWNSHIP OF WOODBRIDGE

TENANT                                 CP CHEMICALS, INC.
<PAGE>

                                TABLE OF CONTENTS

                                                                            Page
                                                                            ----

ARTICLE 1 DEMISED PREMISES - TITLE - TERM OF LEASE.............................1
   Section 1.01. Demised Premises..............................................1
   Section 1.02. Title.........................................................2
   Section 1.03. Term of Lease.................................................2
   Section 1.04. Option to Modify or Extend....................................2
   Section 1.05. Recordable Instruments........................................3

ARTICLE 2 USE OF PREMISES......................................................3
   Section 2.01. Use...........................................................3
   Section 2.02. Parking.......................................................3
   Section 2.03. Scale.........................................................4
   Section 2.04. Office........................................................4

ARTICLE 3 RENT AND OTHER CHARGES...............................................4
   Section 3.01. Rent..........................................................4
   Section 3.02. Additional Rent...............................................5

ARTICLE 4 INTENTIONALLY LEFT BLANK.............................................5

ARTICLE 5 UTILITY EXPENSE......................................................5
   Section 5.01. Utility Expense...............................................5
   Section 5.02. Taxes.........................................................6

ARTICLE 6 RIGHT OF ENTRY.......................................................7
   Section 6.01. Landlord's Right of Entry.....................................7
   Section 6.02. Tenant's Right of Entry.......................................7
   Section 6.03. Noninterference...............................................8
   Section 6.04. Easement......................................................8

ARTICLE 7 CHANGES, ALTERATIONS AND ADDITIONS...................................8
   Section 7.01. Tenant's Right to Make Alterations............................8
   Section 7.02. Compliance with Governmental Requirements.....................9
   Section 7.03. Landlord's Cooperation........................................9

ARTICLE 8 AFFIRMATIVE OBLIGATIONS AND COVENANTS OF TENANT.....................10
   Section 8.01. Affirmative Obligations......................................10

ARTICLE 9 WORK AT THE PREMISES................................................10
   Section 9.01. Work at the Premises.........................................10

ARTICLE 10 ENVIRONMENTAL CONDITIONS...........................................11
   Section 10.01. Deed Notice.................................................11
   Section 10.02. Permits and Approvals.......................................11

                                       -i-
<PAGE>

ARTICLE 11 LANDLORD'S WORK....................................................12
   Section 11.01. Landlord's Work.............................................12

ARTICLE 12 INSURANCE, CASUALTY, CONDEMNATION..................................12
   Section 12.01. Coverages...................................................12
   Section 12.02. Evidence of Insurance.......................................13
   Section 12.03. Fire or Other Casualty......................................13
   Section 12.04. Condemnation................................................14

ARTICLE 13 INDEMNIFICATION....................................................16
   Section 13.01. Tenant's Indemnification of Landlord Against Liability......16
   Section 13.02. Landlord's Indemnification of Tenant Against Liability......16

ARTICLE 14 LANDLORD'S REMEDIES IN EVENT OF TENANT'S DEFAULT OR BANKRUPTCY.....17
   Section 14.01. Events of Default...........................................17
   Section 14.02. Termination of Lease........................................18
   Section 14.03. Landlord's Damages..........................................18
   Section 14.04. No Waiver...................................................18

ARTICLE 15 ASSIGNMENT AND SUBLETTING..........................................18
   Section 15.01. Right of Assignment.........................................18
   Section 15.02. Landlord's Right to Collect Rent............................19

ARTICLE 16 EFFECTIVE DATE.....................................................19
   Section 16.01. Effective Date..............................................19

ARTICLE 17 EXONERATION OF INDIVIDUALS.........................................20
   Section 17.01. Exoneration.................................................20

ARTICLE 18 NOTICES............................................................20
   Section 18.01. Notices.....................................................20

ARTICLE 19 SECURITY...........................................................21
   Section 19.01. Security....................................................21

ARTICLE 20 QUIET ENJOYMENT - CONVEYANCE BY LANDLORD-REPRESENTATIONS BY THE
LANDLORD .....................................................................21
   Section 20.01. Quiet Enjoyment.............................................21
   Section 20.02. Conveyance by Landlord......................................21
   Section 20.03. Representations and Warranties of Landlord..................22

ARTICLE 21 ESTOPPEL CERTIFICATE...............................................23

ARTICLE 22 [INTENTIONALLY LEFT BLANK].........................................23

ARTICLE 23 SURRENDER..........................................................23
   Section 23.01. Conditions of Surrender.....................................23

                                      -ii-
<PAGE>

   Section 23.02. Tenant's Property...........................................23

ARTICLE 24 LEASEHOLD MORTGAGE.................................................24
   Section 24.01. Leasehold Mortgage..........................................24

ARTICLE 25 MISCELLANEOUS......................................................31
   Section 25.01. Submission of Lease.........................................31
   Section 25.02. Governing Law...............................................31
   Section 25.03. Broker......................................................31
   Section 25.04. Savings Clause..............................................32
   Section 25.05. Signs.......................................................32
   Section 25.06. Non-Merger; No Fee Estate Subordination.....................32
   Section 25.07. Parties Bound...............................................33
   Section 25.08. Number and Gender...........................................33
   Section 25.09. Captions....................................................33
   Section 25.10. Counterparts................................................33
   Section 25.11. No Surrender................................................33

ARTICLE 26 CONFIDENTIAL INFORMATION...........................................33
   Section 26.01. Confidential Information....................................33

                                     -iii-
<PAGE>

                                    L E A S E

      THIS INDENTURE OF LEASE (hereinafter called "Lease") dated the day of
_______ 2000 by and between, THE TOWNSHIP OF WOODBRIDGE with an address at
________________ (hereinafter referred to as "Landlord"), and CP CHEMICALS, INC.
having an address at One Parker Plaza, Fort Lee, New Jersey 07024 (hereinafter
referred to as "Tenant"). This Lease shall take effect on the Closing Date, as
defined in the Agreement for Transfer of Ownership to which this Lease is an
Exhibit. The Landlord and Tenant may be collectively referred to as the Parties.

                              W I T N E S S E T H :

                                    ARTICLE 1

                    DEMISED PREMISES - TITLE - TERM OF LEASE

      Section 1.01. Demised Premises

      In consideration of the rents, covenants and agreements hereinafter
reserved and contained on the part of the Tenant to be observed and performed,
Landlord does hereby lease and demise to the Tenant and the Tenant does hereby
hire, lease and take from Landlord, for the Term subject to and upon the
covenants, terms, agreements and conditions hereinafter set forth, that portion
of a certain tract or parcel of land as described and depicted in Exhibit 1 (the
"Premises" or "Demised Premises") which is part of a larger tract or parcel of
land consisting of approximately fourteen (14) acres lying and being located on
Arbor Street, Sewaren, Woodbridge Township, know as Block 729, Lot 3; Block
729A, Lot 1; Block 730, Lots 1 and 1B; and Block 731, Lot 1B on the tax map of
the Township of Woodbridge, County of Middlesex, State of New Jersey (the
"Property"). The Premises is also commonly known as Areas 1, 5 and 7, the
loading pad at Building 19, the loading dock at Building 44, and Building 44.
The square footage of the Demised Premises is as follows: Area 1: 2,520 sq. ft.;
Area 5: 652 sq. ft.; Area 7: 856 sq. ft.; the loading pad at Building 19: 560
sq. ft.; the loading dock at Building 44: 4,200 sq. ft.; and Building 44: 9,052
sq. ft..

                                      -1-
<PAGE>

      Together with any and all improvements presently on the Premises.

      Together with all the appurtenances, rights, interests, easements and
privileges pertaining to the Premises.

      Section 1.02. Title

      At the commencement of the Term of the Lease, Landlord shall own the fee
title to the Demised Premises, subject to restrictions and encumbrances of
record, zoning regulations affecting such Premises and any state of facts shown
on an accurate survey or as a visual inspection of the Premises would disclose.

      Section 1.03. Term of Lease

      The Term of the Lease shall be ten (10) years commencing on the Closing
Date, as defined in the Agreement for Transfer of Ownership to which this Lease
is an Exhibit ("Commencement Date") and shall expire ten (10) years thereafter,
except to the extent that Tenant continues to require access to satisfy Tenant's
Environmental Obligations, as defined herein. As to Tenant's Environmental
Obligations, this Lease shall expire when Tenant receives written notice from
the applicable governmental agency that its Environmental Obligations are
satisfied. Environmental Obligations shall be defined as any obligation imposed
on Tenant by a governmental authority under Environmental Laws. Environmental
Laws shall be defined as any state, federal, local or county, statute, law, rule
or regulation concerning the environment including any permit, order, consent
order or other document issued thereunder ("Expiration Date"). The aforesaid
period shall be referred to as the "Term" or "Lease Term".

      Section 1.04. Option to Modify or Extend

      Tenant shall have the option to expand or modify the Premises subject to
its use by providing Landlord with sixty (60) days advance written notice of a
request to modify its leasehold interest. Said notice shall include a
description of the property to be included in or excluded from the leasehold,
the effective date, and proposed terms and conditions associated with the
request. Landlord agrees to review any such request and respond to Tenant, in
writing, within thirty (30) days of receipt of Tenant's request.

                                      -2-
<PAGE>

Landlord's consent to Tenant's request shall not be unreasonably withheld,
delayed or conditioned.

      Section 1.05. Recordable Instruments

      Upon the commencement of the Term, Landlord and Tenant shall execute and
exchange the following recordable instruments: 1. a form of memorandum of lease;
2. easement documents; and 3. any other recordable instruments required by this
Lease. All recordable instruments shall be in a form acceptable to both Parties
and shall be approved by both Parties prior to recordation. All costs associated
with the preparation, execution and recordation of any recordable instrument
shall be paid in full by the Party making the request for the recordable
instrument. All recordable instruments shall include a termination date and
shall automatically expire no later than the Expiration Date, as defined herein.

                                   ARTICLE 2

                                USE OF PREMISES

      Section 2.01. Use

      The Tenant shall use and occupy the Premises for the uses permitted by
Tenant's Hazardous Waste Facility Permit, EPA I.D. No. NJD002141950, N.J.
Facility No. 1225H1, attached as Exhibit 2 and storage, preparation and/or
transfer of material for market or further development ("Tenant's Use").

      Section 2.02. Parking

      Subject to the following conditions, Tenant shall have access to and use
the parking area, at no Additional Rent or other charge, as designated on
Exhibit 3 for the Term of the Lease. Tenant will be allowed a minimum of two (2)
parking spaces throughout the Term. Landlord shall have the right to assign
parking spaces and limit the number of parking spaces available to Tenant, based
on Landlord's use of the Property. Tenant's use of the parking area shall be
subject to the reasonable

                                      -3-
<PAGE>

rules and regulations that may be established by Landlord and that shall be
provided to Tenant in writing.

      Section 2.03. Scale

      Tenant shall have the right to access and use the scale, at no Additional
Rent or other charge, as depicted on Exhibit 3 for the Term of the Lease.
Tenant's use of the scale shall be subject to the reasonable rules and
regulations that may be established by Landlord and that shall be provided to
Tenant in writing. Landlord reserves a right to designate hours during which
Tenant may have access to the scale. Landlord shall have no obligation to
maintain and/or repair the scale and shall have no liability to Tenant if the
scale fails to operate.

      Section 2.04. Office

      Tenant shall have access to and use of an office in the building currently
used for offices, at no Additional Rent or other charge, as designated on
Exhibit 3, for the Term of the Lease. Landlord shall designate the area in the
office available to Tenant. Tenant's use of the office shall be subject to the
reasonable rules and regulations that may be established by Landlord and shall
be provided to Tenant in writing.

                                   ARTICLE 3

                             RENT AND OTHER CHARGES

      Section 3.01. Rent

      A. The Annual Rent to be paid by Tenant to Landlord shall be as follows:

      Calendar Year or Portion Thereof          Annual Amount
      --------------------------------          -------------
             1                                  $300,000.00
             2                                  $300,000.00
             3                                  $300,000.00
             4                                  $200,000.00
             5                                  $200,000.00
             6                                  $200,000.00
             7                                  $125,000.00
             8                                  $125,000.00

                                      -4-
<PAGE>

             9                                  $125,000.00
             10                                 $125,000.00

      B. Said Annual Rent shall be paid in advance on a calendar year basis,
without notice or invoice from Landlord. The Annual Amount for year 1 shall be
paid in two payments. The first payment shall be in the amount of $150,000 and
shall be made upon execution of this Lease by Woodbridge Township on the Closing
Date. The second payment shall be made on December 1, 2000 and shall be in the
amount of $150,000. Thereafter, the Annual Rent shall be paid yearly on January
1 or the first business day thereafter. Said Annual Rent and all other payments
due under this Lease (sometimes herein collectively referred to as "Rent") shall
be paid to the Landlord at its address hereinabove first specified, or, to such
other payee or address as the Landlord may otherwise direct in writing.

      C. In the event that the Annual Rent is not received by Landlord within
fifteen (15) days after the due date, there will be late charge in the amount of
eight percent (8%) of the annual amount.

      Section 3.02. Additional Rent

      All payments Tenant is required to make pursuant to this Lease, other than
Annual Rent payments shall constitute "Additional Rent" and, if Tenant defaults
in any such payment so as to create an Event of Default (as hereinafter
defined), Landlord shall have (in addition to any rights and remedies granted
hereby) all rights and remedies provided by law for the nonpayment of rent.

                                   ARTICLE 4

                            INTENTIONALLY LEFT BLANK

                                   ARTICLE 5

                                 UTILITY EXPENSE

      Section 5.01. Utility Expense

                                      -5-
<PAGE>

      Tenant shall bear its own utility costs. Tenant shall, at its election,
either arrange for separate electric, water, and gas service at its sole cost
or, if Tenant uses the existing electric, water or gas service, Tenant shall
reimburse Landlord for Tenant's electric, water, or gas use. Tenant does not
intend to use water or natural gas at the Premises. Tenant agrees to reimburse
Landlord for any incremental increase in the costs of operating the wastewater
treatment plant arising from Tenant's operations.

      Section 5.02. Taxes

      Tenant shall pay, as Additional Rent, the percent of all Real Estate Taxes
(as defined below) attributable to the land included in Demised Premises and one
hundred 100% percent of the Real Estate Taxes attributable to the buildings in
the Demised Premises and to any Improvements constructed on the Demised Premises
by the Tenant which may be levied or assessed or which accrue on or after the
Commencement Date. For purposes of this Lease, the percent of Real Estate Taxes
attributed to the Demised Premises shall be calculated by dividing the amount of
Real Estate Taxes by the square footage of the Property and multiplying the
result by the square footage of the Demised Premises. Any Real Estate Taxes
attributed to Improvements constructed by Tenant shall not be included in this
calculation. Tenant acknowledges that the Premises do not constitute a separate
independent tax lot but are part of a larger combined tax lot owned by Landlord.

      As used in this Paragraph, the words and terms which follow mean and
include the following:

      (i) "Real Estate Taxes shall mean the property taxes which shall or may be
levied, assessed imposed, become due and payable, or become liens upon the
property of which the Premises forms a part, or arise in connection with the
specific use, occupancy or possession of, or become due or payable out of, or
for the Premises, or for the Premises or any part thereof, or any buildings or
other improvements actually on the Premises, or levied, assigned or imposed upon
the rent, as such, payable the Landlord. If due to a future change in the method
of taxation prevailing at the date of this Lease, any franchise, income or
profit tax or a license fee measured by or based in

                                      -6-
<PAGE>

whole or in part upon the Premises or any portion thereof, shall be levied,
assessed or imposed against Landlord in substitution for, or in lieu of, the
whole or any part of any tax now levied, assessed or imposed which would
otherwise constitute Real Estate Taxes, such franchise, income or profit tax or
license fee shall be deemed to be Real Estate Taxed for the purposes hereof;
conversely, any additional real estate tax hereafter imposed in substitution
for, or in lieu of, any franchise, income or profit tax (which is not in
substitution for, or in lieu of, or in addition to, a Real Estate Tax as
hereinbefore provided) shall not be deemed Real Estate Taxes for the purposes
hereof. Real Estate Taxes shall also include all fees and expenses, including
legal fees, to context and/or challenge any tax assessment.

                                   ARTICLE 6

                                 RIGHT OF ENTRY

      Section 6.01. Landlord's Right of Entry

      For the duration of this Lease, Landlord shall have the right to enter
upon the Demised Premises for the purpose of: (1) fulfilling its obligations
under the Agreement For Transfer of Ownership to which this Lease is an exhibit
including, without limitation, Landlord's obligations under Paragraphs 29 and
40; (2) inspecting Tenant's operations to ensure compliance with this Lease; (3)
inspect the Demised Premises; and (4) to carry out any actions ordered by the
state, federal or local governments. This access shall include, but not be
limited to access the interiors of buildings, the ability to drill wells,
collect soil borings, and collect other samples as directed by local, state or
federal court or governmental agency.

      Section 6.02. Tenant's Right of Entry

      For the duration of this Lease, Tenant shall have the right to enter upon
the Property not included in the Premises for the purpose of: (1) fulfilling its
obligations under the Agreement For Transfer of Ownership to which this Lease is
an Exhibit; (2) for access post closing as described in

                                      -7-
<PAGE>

Paragraph 13 of the Agreement For Transfer of Ownership to which this Lease is
an Exhibit; (3) to carry out any actions ordered by the state, federal or local
governments; and (4) as may otherwise be necessary under this Lease including
without limitation, to access the Premises. This access shall include, but not
be limited to access the interiors of buildings, the ability to drill wells,
collect soil borings, and collect other samples as directed by any local, state
or federal court or governmental agency.

      Section 6.03. Noninterference

      The Parties shall use best efforts to avoid interfering with each other's
use of the Property and the Premises when exercising these access rights.

      Section 6.04. Easement

      The Parties agree that Tenant's post closing access rights shall also be
memorialized in a form of an easement, the terms of which shall be agreeable to
both Parties, that will be executed simultaneous with and as a condition to the
execution of this Lease.

                                   ARTICLE 7

                       CHANGES, ALTERATIONS AND ADDITIONS

      Section 7.01. Tenant's Right to Make Alterations

      A. Subject to the prior approval of the Landlord, which approval shall not
be unreasonably withheld, delayed, or conditioned, Tenant shall be entitled to
build, make any alterations, rebuildings, replacements, changes, improvements or
additions to the Premises (hereinafter referred to collectively as the
"Alterations" or "Improvements").

      B. Subject to the provisions herein, Tenant has the right to make any
Alterations as long as Tenant complies with the requirements set forth below:

            (i) that the same shall be performed in a first class workmanlike
manner;

                                      -8-
<PAGE>

            (ii) that before the commencement of any such work, Tenant's plans
and specifications shall be filed with and approved by necessary government
authorities and any public utility company and such work shall be done subject
to and in accordance with all applicable law;

            (iii) all Improvements shall be and remain the property of the
Tenant until the Term expires. Upon that date, Landlord shall, at its option,
direct the Tenant to either deliver the Improvements to the Landlord or remove
the Improvements from the Property. Tenant shall repair any damages caused by
the removal of an Improvement at Tenant's cost.

            (iv) Tenant agrees to pay any increase in taxes or make payment in
lieu of taxes for any increase in taxes over the base year 2000 that are
assessed as a result of an Improvement or Alteration made by Tenant.

            (v) Tenant agrees that it shall provide a bond to insure the
completion of any Alteration in excess of $25,000.00.

            (vi) All work shall be subject to inspection and approval by the
Landlord, consistent with Landlord's approval under SubParagraph A hereof and
Section 7.02. Landlord's approval shall not be unreasonably withheld, delayed or
conditioned.

      Section 7.02. Compliance with Governmental Requirements

      Any Alteration shall be made in compliance with all applicable laws, rules
and governmental regulations.

      Section 7.03. Landlord's Cooperation

      Landlord shall promptly sign all permits and applications which may be
required to secure any necessary approvals for the construction and/or
alteration of the Improvements constructed by Tenant, in accordance with the
terms of this Lease. Any request made hereunder shall be at the sole cost and
expense of Tenant.

                                      -9-
<PAGE>

                                   ARTICLE 8

                 AFFIRMATIVE OBLIGATIONS AND COVENANTS OF TENANT

      Section 8.01. Affirmative Obligations

      Tenant covenants and agrees, at its own cost and expense, at all times
during the Term, to:

      A. Comply with Laws. Comply with applicable laws, ordinances, rules and
regulations of governmental authorities or obtain an exception or exemption
therefrom.

      B. Garbage. Handle and dispose of all rubbish, garbage and waste from
Tenant's operation in accordance with laws and ordinances. Tenant's actions
under this provision shall be subject to the reasonable rules and regulations
that may be established by Landlord and that shall be provided to Tenant in
writing.

      C. Tenant shall have the right to contest by appropriate legal proceedings
which shall be conducted diligently and in good faith in the name of Landlord or
Tenant or both and without cost or expense to Landlord, the validity or
applicability of any law, ordinance, order, rule, or regulation of the nature
hereinabove referred to and Tenant shall have the right to delay observance
thereof and compliance therewith until such contest is finally determined and is
no longer subject to appeal, provided that observance and compliance therewith
pending the prosecution of such proceeding may be legally delayed without
subjecting Landlord to any criminal liability or fine. Tenant shall indemnify,
defend and hold Landlord harmless for any damages, cost or expense incurred by
Landlord as a result of Tenant's actions under this SubParagraph C.

                                   ARTICLE 9

                              WORK AT THE PREMISES

      Section 9.01. Work at the Premises

      A. Notice is hereby given that Landlord shall not be liable for any work
performed or to be performed at the Premises for Tenant, or for any materials
furnished or to be furnished at the Premises for Tenant, and that no mechanic's
or other lien for such work or materials shall attach to or

                                      -10-
<PAGE>

affect the interest of Landlord in and to the Premises. Any mechanic's lien
filed against the Premises as a result of the Tenant's acts shall be bonded or
removed by the Tenant within thirty (30) days after Tenant receives written
notice of any such liens having been filed. Tenant is permitted to finance
equipment, furnishings, and fixtures installed by Tenant. Landlord shall sign a
waiver form acknowledging the financing and in which any such lender rights
shall be acknowledged and recognized. Such waiver must provide that any
lienholder will repair any damage caused in connection with the removal of any
property and that any property shall be removed within sixty (60) days after the
end of the Term so long as monthly payments of Annual Rent and Additional Rent
are paid to the Landlord for such additional period needed to remove the
property.

                                   ARTICLE 10

                            ENVIRONMENTAL CONDITIONS

      Section 10.01. Deed Notice

      Landlord and Tenant acknowledge that the Property, including the Premises,
is currently the subject of a Deed Notice recorded in Deed Book 04643P, Pages
236 to 258. Landlord agrees to allow Tenant to record any modification(s) to
that Deed Notice approved by the New Jersey Department of Environmental
Protection ("DEP"). Landlord agrees to comply with all requirements set forth in
the recorded Deed Notice and any modifications. Tenant shall implement the
requirements pursuant to Article 13 and Section 10.02. Tenant shall provide
notice to Landlord of any modification to the Deed Notice. Landlord shall have
the opportunity to review any Deed Notice in advance of recordation; however,
Landlord agrees that its review and comment on a modification to the Deed Notice
shall not be inconsistent with the requirements imposed by the New Jersey
Department of Environmental Protection or other federal, state, local or county
agency and shall not cause Tenant to be in violation of any such requirement.
Tenant further agrees to provide Landlord with a copy of any documents sent to
or received from the DEP pursuant to this Section 10.01.

      Section 10.02. Permits and Approvals

                                      -11-
<PAGE>

      Tenant agrees that it will obtain all necessary permits and approvals for
its use of the Premises. Tenant agrees that, except as provided below, Tenant
will not rely on any of Landlord's permits and approvals without the express
written consent of Landlord. Landlord agrees that it will not rely on any of
Tenant's permits and approvals without the express written consent of Tenant.
Landlord and Tenant agree that Tenant shall have a right, during the Term of the
Lease, to utilize Landlord's Indirect User Permit authorizing discharge to the
Middlesex County Utilities Authority and, to request that Landlord seek
modification of that permit, at no cost to Landlord. Tenant further agrees that
it will reimburse Landlord for any incremental increases in the cost of
operating the wastewater treatment plant or Groundwater Recovery System as a
result of any such request by Tenant. Landlord agrees that it will operate and
maintain the Groundwater Recovery System as defined in Exhibit 4.

                                   ARTICLE 11

                                 LANDLORD'S WORK

      Section 11.01. Landlord's Work

      Landlord shall not, except as specifically provided for herein, be
required to do any work to make the Demised Premises ready for Tenant's use and
occupancy.

                                   ARTICLE 12

                        INSURANCE, CASUALTY, CONDEMNATION

      Section 12.01. Coverages

      A. Tenant shall, at its own cost and expense, maintain comprehensive
public liability insurance against claims for personal injury, death and
property damage occurring in or about the Premises; such insurance shall afford
minimum protection of one million dollars ($1,000,000) with respect to the
personal injury or death of any one person; one million dollars ($1,000,000)
with respect to personal injury or death occurring or resulting from one
occurrence naming Landlord as an additional insured.

                                      -12-
<PAGE>

      B. Tenant shall obtain at its own cost and expense, maintain all risk
property, fire and casualty insurance in the amount of one million dollars
($1,000,000). Landlord shall be named as an additional insured.

      C. Landlord acknowledges that, except as specifically provided for in this
Lease, Landlord shall have no right to any of the proceeds of said insurance and
that Landlord has no insurance coverage under any policies obtained where Tenant
is named as the sole loss payee.

      D. Except as provided herein, Landlord shall have the right to receive
insurance proceeds for damage or destruction to the Improvements. Landlord shall
have no right to any insurance proceeds covering Tenant's contents, including
without limitation equipment, machinery, raw materials and product.

      E. Tenant shall advise its insurers to notify Landlord at least thirty
(30) days prior to the termination or cancellation of any insurance maintained
pursuant to this Section 12.01.

      Section 12.02. Evidence of Insurance

      All insurance required to be maintained by Tenant by this Article 12 may
be effected by policies of blanket insurance, covering property other than the
Premises. Tenant shall furnish Landlord with reasonable proof of compliance with
the requirements of this Article.

      Section 12.03. Fire or Other Casualty.

      A. In the event of a fire or other casualty affecting the Premises, Tenant
shall, within one hundred twenty (120) days after the date it receives its final
casualty insurance proceeds, advise Landlord in writing whether it shall: 1.
commence rebuilding its Improvements; or 2. abandon the Premises; or 3. modify
its use of the Premises. Tenant agrees to diligently pursue final casualty
insurance proceeds.

      B. Notwithstanding anything to the contrary contained in the preceding
Paragraph A of this Section or elsewhere in this Lease, during the Term, Tenant
may terminate this Lease on fifteen (15) days notice to Landlord, given within
one hundred twenty (120) days after Tenant's receipt of its

                                      -13-
<PAGE>

final casualty proceeds if Tenant's Improvements shall be damaged or destroyed
where the cost to repair the Improvements shall amount to ten (10%) percent or
more of the cost of replacement thereof. In the event Tenant does not elect to
terminate this Lease, Tenant shall, subject to receipt of any necessary
municipal approvals, commence restoration one hundred and twenty (120) days from
receipt of the casualty insurance proceeds and shall have the right to use said
proceeds to rebuild with the remainder of the proceeds to be paid to Landlord.
In the event Tenant elects to terminate the Lease, the casualty insurance
proceeds shall be used, first to level the building and remove all debris caused
by the casualty and the demolition of the building, then to payoff any Leasehold
Mortgagee and the remaining balance to the Landlord. Notwithstanding the above,
Landlord shall have no right to insurance proceeds paid as a result of loss of
contents including without limitation Tenant's equipment, machinery, raw
materials, product or other contents.

      C. This provisions of this Section 12.03 shall have no effect on Tenant's
obligation to pay Rent pursuant to Article 3 of this Lease.

      Section 12.04. Condemnation

      A. Total or Partial Condemnation. If the whole of the Premises shall be
taken for any public or any quasi-public use under any statute or by right of
eminent domain, or by private purchase in lieu thereof, then this Lease shall
automatically terminate as of the date that title shall be taken. If a
substantial part of the Premises shall be taken, including a portion of Tenant's
building or the property, so as to interfere with the operation of Tenant's
business, then Tenant shall have the right to terminate this Lease, effective as
of the actual taking, on thirty (30) days notice to the Landlord given within
ninety (90) days after receipt of the Notice of Taking. In the event only a
portion of the Premises (not affecting the building) shall be taken and, in
Tenant's judgment reasonably exercised, the balance of the Premises after
reconstruction is suitable for Tenant's business, this Lease shall not terminate
and Tenant shall be entitled to use the condemnation proceeds applicable to the
Improvements on the Premises to rebuild. Except as provided herein, in

                                      -14-
<PAGE>

the event that Tenant elects not to rebuild, Landlord shall have the right to
all condemnation proceeds. In the event Tenant elects to rebuild, and Landlord
consents to use of the proceeds applicable to the Improvements on the Premises,
Landlord shall have the right to any remaining proceeds. In the event that
Tenant elects to rebuild and Landlord does not consent to the use of the
proceeds applicable to the Improvements on the Premises, Tenant shall have no
obligation to rebuild. This subparagraph shall have no effect on Tenant's
obligation to pay Rent pursuant to Article 3 of this Lease.

      B. Disposition of Proceeds. Except as provided herein, all compensation
awarded or paid upon such total or partial taking of the land comprising the
Premises shall belong to and be the property of the Landlord unless Tenant is
permitted by law (at the same time as Landlord is permitted to assert its claim)
to assert a claim against the condemning authority enforcing the condemnation
for losses sustained by the Tenant as a result of the condemnation in which case
Tenant shall have a right to those proceeds. In the event Tenant is not entitled
to assert a separate claim, Landlord and Tenant shall jointly file a claim
asking for separate awards with respect to their respective interests. If the
condemning authority will not establish separate awards, and Landlord and Tenant
cannot agree upon the distribution and use of a unified award, the dispute shall
be submitted to arbitration in accordance with the rules of the American
Arbitration Association.

      C. Commencement of Condemnation. Landlord agrees that it will not commence
a condemnation proceeding during the Term of the Lease without Tenant's consent.
Landlord further agrees that it will not solicit, direct or support a
condemnation by another authority during the Term of the Lease without Tenant's
consent.

      D. Condemnation Process. Landlord and Tenant acknowledge that Tenant has
been issued a facility permit, Exhibit 2, for Tenant's operations at the Demised
Premises. In the event Tenant determines that the value offered by the
condemning authority does not, in Tenant's discretion, reflect the value of this
permit, Tenant reserves the right, at Tenant's cost and expense, to

                                      -15-
<PAGE>

challenge the valuation of the Property. If Tenant pursues a challenge, Tenant
shall make best efforts to prevent a delay in Landlord's receipt of proceedings
and, if necessary, shall advance Landlord's proceeds in which case, Landlord
shall assign its rights in the condemnation to Tenant.

                                   ARTICLE 13

                                 INDEMNIFICATION

      Section 13.01. Tenant's Indemnification of Landlord Against Liability

      Tenant hereby releases, holds harmless and agrees to defend and indemnify
Landlord with respect to all actions, causes of action, obligations, expenses,
liabilities, losses, penalties, fines, fees (including counsel fees and
reasonable costs of investigation and defense) and costs, claims, suits and
damages for personal injury, property damage and violation of any federal,
state, county, or local law, statute, regulation, rule or ordinance which
Landlord may incur, pay out, be exposed to and/or other be responsible for which
arises from, or is related to the Premises, that is caused by Tenant's conduct,
inaction, condition or discharge that: (1) occurs during the Term of the Lease
and is a result of Tenant's activities on the Premises or use, non-use or
maintenance of the Premises; or (2) any use, non-use or maintenance of the
Premises in violation of the terms of the Lease; or (3) any negligence, willful
misconduct of Tenant, or intentional acts by Tenant, its agents, employees,
invitees, congregates, contractors, officers or directors; or (4) any breach or
default by Tenant of this Lease or failure by Tenant to perform any of its
obligations under the Lease. This indemnification is not assignable.

      Section 13.02. Landlord's Indemnification of Tenant Against Liability

      Landlord hereby releases, holds harmless and agrees to defend and
indemnify Tenant with respect to all actions, causes of actions, obligations,
expenses, liabilities, losses, penalties, fines, fees (including counsel fees
and reasonable costs of investigation and defense) and costs, claims, suits and
damages for personal injury, property damage and violation of any federal,
state, county or local law, statue, regulation, rule or ordinance which Tenant
may incur, pay out, be exposed to and/or otherwise

                                      -16-
<PAGE>

be responsible for which arises from, or is related to the Property, that occurs
as: (1) a result of Landlord's activities on the Property, including the
Premises, or (2) arises or is related to the operation and maintenance or
failure to operate or maintain the Groundwater Recovery System; or (3) a result
of any negligence, willful misconduct of Landlord, or intentional acts by
Landlord, its agents, employees, invitees, congregates, contractors, officers or
directors; or (4) any breach or default by Landlord of this Lease or failure by
Landlord to perform any of its obligations under the Lease. This indemnification
is not assignable except as provided at Article 15.

                                   ARTICLE 14

         LANDLORD'S REMEDIES IN EVENT OF TENANT'S DEFAULT OR BANKRUPTCY

      Section 14.01. Events of Default

      Tenant shall be in default of this Lease if any one or more of the
following events (referred to herein as "Events of Default") occurs:

      A. Tenant defaults in the payment of Annual Rent and/or Additional Rent
and such defaults continues for thirty (30) days after notice.

      B. Except as set forth in Subparagraph A above, Tenant defaults in the
observance or performance of any covenant or provision of this Lease and such
default continues for sixty (60) days after notice of such default from Landlord
provided, however, if such default cannot by its nature be cured within such
sixty (60) day period, no event of default shall be deemed to exist as long as
Tenant has commenced curing the same within such sixty (60) day period and
diligently prosecutes the cure.

      C. Tenant shall make an assignment for the benefit of creditors or shall
assign or sublet, except as permitted hereunder.

      D. A voluntary petition is filed by Tenant under any laws for the purpose
of adjudication of Tenant as a bankrupt or the extension of the time of payment,
composition, arrangement, adjustment, modification, settlement or satisfaction
of the liabilities of Tenant, or the

                                      -17-
<PAGE>

reorganization of Tenant under the Bankruptcy Act of the United States or any
future laws of the United States having the same general purpose, or receivers
appointed for Tenant by reason of insolvency or alleged insolvency of Tenant; an
involuntary petition shall be filed against Tenant for such relief and shall not
be dismissed within sixty (60) days.

      Section 14.02. Termination of Lease

      Landlord, notwithstanding any other right or remedy it may have under the
Lease, at law or in equity, may, in an event of Default and Tenant's failure to
cure as set forth above, terminate the Lease, by written notice to Tenant
setting forth the basis therefor and effective not less than ninety (90) days
thereafter, whereupon, upon such effective date, this Lease shall terminate
(with the same effect as if such date were the date fixed herein for the natural
expiration of the Term), Tenant shall surrender the Premises to Landlord. In
such event, Landlord may, without further notice, enter the Premises, repossess
the same and dispossess Tenant and all other persons and property therefrom.

      Section 14.03. Landlord's Damages

      If Landlord so terminates the Lease, Tenant shall pay Landlord, as damages
in a sum equal to the Annual Rent, when the same would have been payable over
the remaining Term if not for such termination.

      Section 14.04. No Waiver

      The failure of either Party to seek redress for violation of, or to insist
upon the strict performance of any covenant or condition of this Lease, shall
not prevent a subsequent act which would have originally constituted a violation
from having all the force and effect of an original violation. No provision of
this Lease shall be deemed to have been waived by either Party unless such
waiver be in writing signed by the Party against whom waiver is sought.

                                   ARTICLE 15

                            ASSIGNMENT AND SUBLETTING

      Section 15.01. Right of Assignment

                                      -18-
<PAGE>

      At any time during the Term Tenant may, upon not less than ten (10) days
written notice to Landlord, sublet or assign this Lease to an Affiliate of the
Tenant without consent of the Landlord. Affiliate shall be defined as a parent
or wholly owned subsidiary of the Tenant. As to Landlord, Tenant shall retain
responsibility for Tenant's obligations hereunder, notwithstanding any
assignment or subletting. All other assignments or sublettings require
Landlord's approval in Landlord's sole discretion.

      A. In the event of any sublease or assignment, Tenant shall remain fully
and primarily liable for all terms and conditions of the Lease as a principal
and not as a surety. In the event of an assignment, the assignee, other than a
Leasehold Mortgagee, shall assume all of the Tenant's obligations under the
Lease.

      Section 15.02. Landlord's Right to Collect Rent

      If this Lease is assigned, or if the Premises or any part thereof be
sublet or occupied by anyone other than Tenant, Landlord may upon prior notice
to Tenant at any time and from time to time, collect Annual Rent and Additional
Rent and all the charges from the assignee, sublessee or occupant and apply the
net amount collected to such sums reserved herein.

                                   ARTICLE 16

                                 EFFECTIVE DATE

      Section 16.01. Effective Date

      This Lease shall be executed on the Closing Date by the Landlord and shall
take effect on the Closing Date as defined in the Agreement for Transfer of
Ownership to which this Lease is an Exhibit.

                                      -19-
<PAGE>

                                   ARTICLE 17

                           EXONERATION OF INDIVIDUALS

      Section 17.01. Exoneration

      If the Landlord or any successor in interest shall be an individual, joint
venture, trust, tenancy in common, limited liability company, firm or
partnership, general or limited there shall be no personal liability on such
individual or on any member of such joint venture, limited liability company,
trust, tenancy in common, firm or partnership in respect to any of the covenants
or conditions of this Lease. The Tenant shall look solely to the equity of the
Landlord in the Property and not its directors, shareholders, officers, members,
employees or agents in the event of a breach by the Tenant of any of the
covenants or conditions of this Lease or any liability arising out of the
Tenant's use or occupancy of the Premises.

                                   ARTICLE 18

                                     NOTICES

      Section 18.01. Notices

      All notices, demands and requests which may or are required to be given by
either party to the other shall be in writing. All notices, demands and requests
by the Landlord to the Tenant shall be sent by either (i) United States
Certified Mail, return receipt requested, postage prepaid; (ii) nationally
recognized overnight carrier; (iii) one day U.S. Post Office delivery; or (iv)
personal receipted delivery addressed to the Tenant, at the address set forth
above Attention: Thomas L. Moran or at such other place as the Tenant may from
time to time designate in a written notice to the Landlord. Additionally, copies
of all notices to Tenant shall be sent to: Margaret B. Carmeli, Esq., c/o
Giordano, Halleran & Ciesla, P.C., 125 Half Mile Road, Middletown, New Jersey
07748. All notices, demands and requests by the Tenant to the Landlord shall be
sent by (i) United States Certified Mail, postage prepaid, return receipt
requested, (ii) nationally recognized overnight carrier;

                                      -20-
<PAGE>

(iii) one day U.S. Post Office delivery; or (iv) personal receipted delivery
addressed to the Landlord as follows: Business Administrator, Township of
Woodbridge, One Main Street, Woodbridge, NJ 07095. Additionally, copies of all
notices to Landlord shall be sent to Director of Law, Township of Woodbridge,
One Main Street, Woodbridge, NJ 07095. Notices, demands and requests which shall
be served upon the Landlord or the Tenant in the manner aforesaid shall be
deemed sufficiently served or given for all purposes hereunder five (5) days
after such notice, demand or request shall be mailed or on the date of personal
delivery, whichever is applicable.

                                   ARTICLE 19

                                    SECURITY

      Section 19.01. Security

      Landlord agrees to provide security for the Term of the Lease and
thereafter, until Tenant advises Landlord that such measures are no longer
required, in accordance with the requirement of Tenant's facility permit issued
pursuant to the Resource Conservation and Recovery Act. Not withstanding any
other provision herein, this Section shall survive the breach, termination or
end of the Term of this Lease.

                                   ARTICLE 20

                         QUIET ENJOYMENT - CONVEYANCE BY
                    LANDLORD-REPRESENTATIONS BY THE LANDLORD

      Section 20.01. Quiet Enjoyment

      Tenant, upon paying the Annual Rent and all Additional Rent and other
charges herein provided for and performing all covenants and conditions of this
Lease, on its part to be performed, shall quietly have and enjoy the Premises
during the term, without hindrance or molestation by Landlord or any other
person claiming through Landlord.

      Section 20.02. Conveyance by Landlord

                                      -21-
<PAGE>

      Landlord shall not convey the Premises during the Term in accordance with
the Agreement For Transfer of Ownership to which this Lease is an Exhibit.

      Section 20.03. Representations and Warranties of Landlord

      Landlord represents and warrants that to the best of its knowledge:

      A. Landlord has good and marketable title in fee simple to the Premises,
free of all liens, mortgages, pledges, encumbrances, security interest, leases,
conditional sales agreements or charges of any kind or character.

      B. The execution and delivery of this Lease and the consummation of the
transaction contemplated hereby will not result in a violation of any
requirement or a violation or breach of, or constitute (with or without due
notice or lapse of time or both) a default (or give rise to any right of
termination, cancellation or acceleration) under any of the terms, conditions or
provisions of any note, bond, mortgage, indenture, license, permit, franchise,
agreement or other instrument to which Landlord is a party, or by which Landlord
or the Premises may be bound.

      C. There are no condemnation, zoning or other land use proceedings
(including, without limitation, abatement proceedings), either instituted or
planned to be instituted, which would affect in any way the use and operation of
the Premises or the value of the Premises.

      D. There are no contemplated special assessments affecting the Premises.

      E. As shown on Exhibit 3 annexed hereto, there is an unfettered and
unimpeded means of ingress and egress to the Premises across the Property and
such ingress and egress shall remain unimpeded during the entire Term. Landlord
agrees to execute in recordable form for the benefit of the Premises a
non-exclusive ingress and egress easement over the area shown on Exhibit 3 and
labeled ingress and egress easement thereon. The easement shall include a
requirement that Landlord or its successors or assigns maintain the easement
area. Landlord shall retain a right to reconfigure the easement so long as any
reconfiguration provides Tenant with an equivalent means of ingress and egress.

                                      -22-
<PAGE>

                                   ARTICLE 21

                              ESTOPPEL CERTIFICATE

      Either party hereto shall, within twenty (20) days after notice by the
other party, execute, acknowledge and deliver to such other party or any other
party specified by such other party, a statement in writing certifying (i) that
this Lease is unmodified and in full force and effect (or if there are
modifications, that this Lease, is in full force and effect as modified, and
stating the modifications) and (ii) the date to which the Annual Rent and
Additional Rent payable by Tenant hereunder has been paid, and (b) whether or
not to the best knowledge of the signer of the certificate, the other party is
in default in performance of any covenant, agreement or condition contained in
this Lease and, if so, specifying in detail each such default.

                                   ARTICLE 22

                           [INTENTIONALLY LEFT BLANK]

                                   ARTICLE 23

                                    SURRENDER

      Section 23.01. Conditions of Surrender

      Except as set forth in this Lease, on the last day or sooner termination
of the Lease, Tenant shall quit and surrender the Premises broom-clean without
damage, except reasonable wear and tear, together with all additions and
Improvements which may have been made in, on, or to the Premises consistent with
Article 7 herein In the event Tenant remains in possession of the Premises after
the expiration of the Term created hereunder, and without the execution of a new
lease, Tenant shall be deemed to be holding over and the rate of use and
occupation shall be equal to the twice monthly payment of Annual Rent payable
for the last month of the Term, or any renewal thereof, plus any Additional Rent
as calculated on a month by month basis.

      Section 23.02. Tenant's Property

                                      -23-
<PAGE>

      Any property left at the Premises by the Tenant at the expiration of the
Term or, when Tenant vacates the Premises, shall be deemed abandoned. Landlord
may sell or dispose of said property in any manner it deems appropriate.

                                   ARTICLE 24

                               LEASEHOLD MORTGAGE

      Section 24.01. Leasehold Mortgage

      In the event Tenant gives a leasehold mortgage or collaterally assigns the
Lease to a lender ("Leasehold Mortgagee") so long as there is a Leasehold
Mortgage outstanding or the Lease is collaterally assigned, the Parties agree as
follows:

      A. If the holder of a Leasehold Mortgage shall have registered with
Landlord by notice specifying the name and address of such Leasehold Mortgagee,
Landlord thereafter shall give to such Leasehold Mortgagee a copy of each notice
of default for which provision is made under this Lease at the same time as and
whenever such notice shall be given by Landlord to Tenant, such copy to be
addressed to such Leasehold Mortgagee at the address last furnished to Landlord
as provided hereinabove. In the event of any such registration, Landlord shall
not be entitled to serve a notice of cancellation and termination upon Tenant
unless a copy of any prior notice of default shall have been given to such
Leasehold Mortgagee as hereinabove provided and the time as hereinafter
specified for the curing of such default shall have expired without the same
having been cured. The performance by any such Leasehold Mortgagee of any
condition or agreement on the part of Tenant to be performed hereunder will be
deemed to have been performed with the same force and effect as though performed
by Tenant.

      B. Landlord will accept performance by the Leasehold Mortgagee, within the
following periods (time being of the essence) of any term, covenant and
condition on Tenant's part to be performed hereunder, with the same force and
effect as though timely performed by Tenant (provided that under no
circumstances shall the Leasehold Mortgage be required to so perform):

                                      -24-
<PAGE>

            (i)   As to any Annual Rent, Additional Rent and all other charges
                  payable hereunder within 30 days after notice of such default;
                  and

            (ii)  As to all other defaults hereunder, before the later of (a) 60
                  days after such notice, or (b) the time needed to effect such
                  cure if such default cannot be cured within such period and
                  Leasehold Mortgagee commences to so cure within such period
                  and diligently and continuously proceeds therewith.

      Landlord acknowledges that Leasehold Mortgagee may not be able to effect
any cures until such time as Leasehold Mortgagee acquires title and possession
of the Premises through exercise of the remedies available to it under the
Leasehold Mortgage and agrees that the time periods described in (ii) above
shall be automatically extended so as not to commence running until the
Leasehold Mortgagee so acquires title and possession. The foregoing shall not
limit Tenant's right to cure under the Lease. Landlord further acknowledges that
Leasehold Mortgagee cannot be expected to cure and will not be required to cure
defaults which are personal to Tenant and not susceptible of cure by Leasehold
Mortgagee as a precondition to the rights of Leasehold Mortgagee hereunder.

      C. Landlord shall not exercise its right to terminate this Lease, as
hereinbefore provided, during the time that the Leasehold Mortgagee, having
registered with Landlord pursuant to Section 24.01(A) above, shall require to
complete its remedies under the Leasehold Mortgage, provided, however,

            (i)   That the Leasehold Mortgagee proceeds, promptly and with due
                  diligence, with the remedies under its mortgage on the
                  leasehold estate and thereafter prosecutes and completes the
                  same with all due diligence; and

            (ii)  That the Leasehold Mortgagee shall pay to Landlord the Annual
                  Rent, Additional Rent, and all other charges required to be
                  paid by Tenant hereunder which have accrued and which shall
                  become due and payable during said period of time.

                                      -25-
<PAGE>

      D. Landlord shall also be obligated to give any notice of cancellation and
termination to the Leasehold Mortgagee, who shall have registered with Landlord
pursuant to Section 24.01(A) above, simultaneously with such notice being given
to Tenant. No such notice to Tenant shall be effective to terminate this Lease
if the Leasehold Mortgagee notifies Landlord in writing, within thirty (30) days
after receipt by the Leasehold Mortgagee of such notice of cancellation and
termination, that (i) the Leasehold Mortgagee, or any designee or nominee which
the Leasehold Mortgagee may designate or name in such notice, elects to lease
the Premises from the date of termination of this Lease (as specified in the
notice of cancellation and termination) for the remainder of the term of this
Lease, at the Rent, Additional Rent above, and other charges herein reserved,
and otherwise upon the same terms, covenants and conditions as are herein set
forth, with the same relative priority in time and in right as this Lease and
having the benefit of and vesting in the Leaschold Mortgagee, its designee or
nominee, of all of the rights, title, interest, powers and privileges of the
Tenant hereunder, and (ii) the Leasehold Mortgagee or such designee or nominee
further obligates itself to comply within sixty (60) days after delivery to
Landlord of such election: (a) to cure the default upon which such termination
was based (or in the case of a monetary default any delinquent payments are made
within thirty (30) days after the Tenant's time period to make the payment has
expired) and any other then existing defaults under this Lease, or in respect to
any default not capable of curing within such sixty (60) days, or which cannot
be cured without entry into possession, to proceed and effect cure with due
diligence following delivery of possession, (b) to pay to Landlord at the time
of execution and delivery of such new lease all Rent and Additional Rent and
other charges due under this Lease up to and including the date of commencement
of the term of such new lease, and (c) to pay to Landlord all expenses and
reasonable attorneys' fees incurred by Landlord in connection with any such
default and with the preparation, execution and delivery of such new lease.

                                      -26-
<PAGE>

      Upon compliance by the Leasehold Mortgagee, its designee or nominee,
within such time, Landlord shall thereupon execute and deliver such new lease
(the "New Lease") to the Leasehold Mortgagee, its designee or nominee, having
the same relative priority in time and in right as this Lease and having the
benefit of all of the right, title, interest, powers and privileges of the
Tenant hereunder in and to the Premises, including specifically an assignment of
Landlord's interest in and to any then existing sublease where the subtenant may
have attorney to Landlord and may have been recognized by Landlord and which, at
the time of cancellation or termination of this Lease, was prior in right to the
Leasehold Mortgage or which by separate agreement or by its terms had been
granted non-disturbance privileges. Landlord agrees that it will not modify or
amend any of the terms or provisions of any such sublease so assigned during the
period between the expiration or termination of this Lease and the execution and
delivery of the new lease.

      Landlord shall not be obligated to deliver physical possession of the
Premises or the buildings and improvements on, under or above the Premises to
either the Leasehold Mortgagee or its designee or nominee. In the event,
however, that at the time the new lease is executed Tenant hereunder shall be in
possession of the Premises and of said buildings and improvements, Landlord, at
the request and expense of the Leasehold Mortgagee, its designee or nominee, as
the new tenant, will take all appropriate steps to remove Tenant from the
Premises and from said buildings and improvements, but shall not be liable to
such new tenant for any damages resulting from any delay of Tenant in vacating
the Premises, or from any failure to vacate them and there shall be no abatement
of rent by reason thereof.

      E. A Leasehold Mortgagee may enforce its rights under its mortgage and
acquire title to the leasehold estate in any lawful way, and pending foreclosure
of such Leasehold Mortgage take up possession of the Premises; subject, however,
to the terms and conditions of this Lease and the rights of the holder of any
Leasehold Mortgage that is senior in lien to the Leasehold Mortgage in question.
During such time as a Leasehold Mortgagee is the owner and holder of the
leasehold estate and

                                      -27-
<PAGE>

Tenant's interest hereunder, whether by foreclosure or otherwise, such interest
acquired hereunder shall be subject to all of the terms, conditions and
provisions of this Lease.

      F. Landlord shall upon Tenant's reasonable request execute, acknowledge
and deliver to Tenant and/or each Leasehold Mortgagee an agreement prepared at
the cost and expense of Tenant and in form satisfactory to such Leasehold
Mortgagee, confirming all or any of the provisions of this Section.

      G. The granting of a Leasehold Mortgage by Tenant shall not be deemed to
constitute an assignment or transfer of this Lease or of the leasehold estate
hereby created, nor shall any Leasehold Mortgagee, as such, be deemed to be an
assignee or transferee of this Lease or of the Leasehold Estate hereby created
so as to require such Leasehold Mortgagee, as such, to assume the performance of
any of the terms, covenants, or conditions on the part of the Tenant to be
performed hereunder, but the purchaser at any sale of this Lease and of the
leasehold estate hereby created in any proceedings for the foreclosure of any
Leasehold Mortgage, or the assignee or transferee of this Lease and of the
leasehold estate hereby created under any instrument of assignment or transfer
in lieu of the foreclosure of any Leasehold Mortgage, shall be deemed to be an
assignee or transferee, and shall be deemed to have agreed to perform all of the
ten-ns, covenants, and conditions on the part of the Tenant to be performed
hereunder from and after the date of such purchase and assignment, but only for
so long as such purchaser or assignee is the owner of the leasehold estate.

      H. Any Leasehold Mortgagee or other acquirer of the leasehold estate of
Tenant pursuant to foreclosure, assignment in lieu of foreclosure of a tenant or
other proceedings may, upon acquiring Tenant's leasehold estate, without further
consent of Landlord, sell and assign the leasehold estate on such terms and to
such persons and organizations as are acceptable to such Leasehold Mortgagee or
acquirer and thereafter be relieved of all obligations under this Lease.

      I. Notwithstanding any other provision of this Lease, any sale of this
Lease and of the leasehold estate hereby created in any proceedings for the
foreclosure of any Leasehold Mortgage, or

                                      -28-
<PAGE>

the assigmuent or transfer of this Lease and of the leasehold estate hereby
created in lieu of the foreclosure of any Leasehold Mortgage, shall be deemed to
be a permitted sale, transfer, or assignment of this Lease and of the leasehold
estate hereby created.

      J. Nothing herein contained shall require any Leasehold Mortgagee or its
designee as a condition to its exercise of its rights hereunder to cure any
default of Tenant not reasonably susceptible of being cured by such Leasehold
Mortgagee or its designee in order to comply with the provisions of this
Article. The financial condition of any Leasehold Mortgagee or successor to
Tenant's interest under this Lease or a new lease shall not be a consideration
in the determination of the reasonable susceptibility of cure of any default
hereunder. No default, the cure of which and no obligation of Tenant, the
performance of which, requires possession of the Premises shall be deemed
reasonably susceptible of cure or performance by any Leasehold Mortgagee or
successor to Tenant's interest under this Lease or a new lease not in possession
of the Premises, nor shall any Leasehold Mortgagee be required to cure the
bankruptcy, insolvency, or any related or similar condition of Tenant.

      K. No payments made to Landlord by a Leasehold Mortgagee shall constitute
an acknowledgement that such payment was, in fact, due under the terms of this
Lease.

      L. In the event of any proceeding by either Landlord or Tenant under the
United States Bankruptcy Code as now or hereafter in effect:

            (i)   if the Lease is rejected in connection with a bankruptcy
                  proceeding by the Tenant or a trustee in bankruptcy for the
                  Tenant, such rejection shall be deemed an assignment by Tenant
                  to the Leasehold Mortgagee (or if there is more than one
                  Leasehold Mortgagee, to the one highest in priority) of the
                  Leasehold Estate and all of Tenant's interest under this
                  Lease, in the nature of an assignment in lieu of foreclosure,
                  and this Lease shall not terminate and the Leasehold Mortgagee
                  shall have all the rights of the Leasehold Mortgagee

                                      -29-
<PAGE>

                  under this Lease, as if such bankruptcy proceeding had not
                  occurred, unless such Leasehold Mortgagee shall reject such
                  deemed assignment by notice in writing to Landlord within
                  thirty (30) days following rejection of the Lease by Tenant or
                  Tenant's trustee in bankruptcy. If any court of competent
                  jurisdiction shall determine that this Lease shall have been
                  terminated notwithstanding the terms of the preceding sentence
                  as a result of rejection by Tenant or the Trustee in
                  connection with any such proceeding, the rights of any
                  Leasehold Mortgagee to a new lease from Landlord pursuant to
                  this Section 24.01 hereof shall not be affected thereby.

            (ii)  If the Lease is rejected by Landlord or by Landlord's trustee
                  in bankruptcy;

                  (a) Tenant shall not have the right to treat this Lease as
                  terminated except with the prior written consent of all
                  Leasehold Mortgagees; and the right to treat this Lease as
                  terminated in such event shall be deemed assigned to each and
                  every Leasehold Mortgagee, whether or not specifically set
                  forth in any such Leasehold Mortgage, so that the concurrence
                  in writing of Tenant and each Leasehold Mortgagee shall be
                  required as a condition to treating this Lease as terminated
                  in connection with such proceeding.

                  (b) If this Lease is treated as not having been terminated in
                  accordance with subsection (i) above, then this Lease shall
                  continue in effect upon all the terms and conditions set forth
                  herein, including Annual Rent, Additional Rent, and all
                  options to renew, but excluding requirements that are not then
                  applicable or pertinent to the remainder of the term hereof.
                  Thereafter, Tenant or its successors shall be entitled to
                  offset against Annual Rent and Additional Rent payable
                  hereunder any damages arising from such rejection and any such
                  offset properly made shall not be deemed a default under this

                                      -30-
<PAGE>

                  Lease. The lien of any Leasehold Mortgage then in effect shall
                  extend to the continuing possessor rights of Tenant following
                  such rejection with the same priority with respect to each
                  such Leasehold Mortgage as it would have enjoyed had such
                  rejection not taken place.

      M. Notwithstanding anything to the contrary set forth in this Lease, in
the event the Leasehold Mortgagee takes possession of the Premises, forecloses
on its leasehold mortgage, or takes an assignment of the Lease from the Tenant,
the Leasehold Mortgagee shall be entitled to surrender the Premises to the
Landlord. In the event on the date of the surrender of the Premises all of the
Rent and Additional Rent have been paid up through and including the date of
surrender, and the Premises are delivered vacant, then the Leasehold Mortgagee
shall have no further liability under this Lease. Nothing set forth herein shall
be deemed to release the Tenant from any default under this Lease.

      N. The Leasehold Mortgagee shall have no right to assign the Lease unless
Landlord consents and shall not assign the Lease without Landlord's written
consent.

      O. The Leasehold Mortgagee shall have no right to delay payment.

                                   ARTICLE 25

                                  MISCELLANEOUS

      Section 25.01. Submission of Lease

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

      Section 25.02. Governing Law

      This Lease shall be governed by and construed in accordance with the laws
of the State of New Jersey ("State") and shall be deemed to have been created by
both Parties.

      Section 25.03. Broker

                                      -31-
<PAGE>

      Tenant and Landlord warrants and represents that they have dealt with no
realtors, brokers or agents in connection with the negotiation of this Lease and
the renting of the Premises. Should any claims be made for brokerage commissions
through or on account of dealings of one Party or its agents or representatives,
that Party shall indemnify, defend and hold the other Party harmless against any
liability in connection therewith.

      Section 25.04. Savings Clause

      It is the desire and intent of the Parties that the provisions of this
Lease shall be enforced to the fullest extent permitted by law. Accordingly, the
invalidity or unenforceability of any provision of this Lease shall not affect
the validity or enforceability of any other provision of this Lease, which shall
remain in full force and effect, nor shall the invalidity or unenforceability of
any portion of any provision of this Lease affect the validity or enforceability
of the balance of such provisions.

      Section 25.05. Signs

      Upon receipt of written approval from Landlord, which shall not be
unreasonably delayed, conditioned or withheld, Tenant shall have the right to
install exterior signs (including pylon signs) on the Premises which conform to
all applicable laws and ordinances. Tenant shall maintain all signs on the
Premises in a good state of repair and save the Landlord harmless from any loss,
cost or damage as a result of the erection, maintenance, existence of the same,
and shall repair any damage which shall have been caused by the erection,
existence or maintenance of such signs.

      Section 25.06. Non-Merger; No Fee Estate Subordination

      There shall be no merger of this Lease, or of the leasehold estate created
by this Lease, with the fee estate in the Premises by reason of the fact that
this Lease, the leasehold estate created by this Lease, or any interest in this
Lease or in any such leasehold estate, may be held, directly or indirectly, by
or for the account of any person who shall own the fee estate, and no such
merger shall occur unless and until all persons at the time having an interest
in the fee estate in the Premises and all persons (including the Leasehold
Mortgagee) having an interest in this Lease, or in the leasehold

                                      -32-
<PAGE>

estate created by this Lease, shall join in a written instrument effecting such
merger and shall duly record the same.

      Section 25.07. Parties Bound

      The covenants, conditions and agreements contained in this Lease shall
bind and inure to the benefit of the Landlord and Tenant and their respective
legal representatives, heirs, successors and, except as specifically provided in
this Lease, their assigns.

      Section 25.08. Number and Gender

      For purposes of this Lease, the singular shall include the plural and the
plural shall include the singular, and the masculine shall include the feminine
and the neuter, as the context may require.

      Section 25.09. Captions

      The captions contained herein are for the convenience of the parties only.
They do not in any way modify, amplify, alter or give full notice of the
provisions hereof.

      Section 25.10. Counterparts

      This Lease may be executed in several counterparts, each of which shall be
deemed an original, and such counterparts shall constitute but one and the same
instrument.

      Section 25.11. No Surrender

      Except as provided in this Lease, no surrender to Landlord of this Lease
or of the Premises, or any part thereof, or of any interest therein, shall be
valid or effective unless agreed to and accepted in writing by Landlord and
consented to in writing by any and all Mortgagees, and no act or omission by
Landlord or any representative or agent of Landlord, other than such a written
acceptance by Landlord, consented to as aforesaid, shall constitute an
acceptance of any such surrender.

                                   ARTICLE 26

                            CONFIDENTIAL INFORMATION

      Section 26.01. Confidential Information

                                      -33-
<PAGE>

      To the extent permitted by law, any Party may designate any data,
information, reports or documents provided to the other as "Confidential
Information". Except as required by applicable law or action of governmental
agents acting under color of authority, neither Party shall, without the written
consent of the other Party, disclose any Confidential Information to any third
party.

                           (INTENTIONALLY LEFT BLANK)

                                      -34-
<PAGE>

      IN WITNESS WHEREOF the Landlord and Tenant have caused these presents to
be signed by their duly authorized agent on the day and year above written.

SIGNED AND AGREED TO BY:

                                 Date Signed:   WOODBRIDGE TOWNSHIP

/s/                              6/8/00         By: /s/
------------------------------   ------------       ----------------------------
John M. Mitch, Municipal Clerk                      James E. McGreevey, Mayor

                                                CP CHEMICALS, INC.

Attest:                                         Seller

/s/                              4/18/00        By /s/
------------------------------   ------------       ----------------------------
Secretary                                          Senior Vice President &
                                                   Chief Regulatory Officer

<PAGE>

                                  EXHIBIT LIST*

Exhibit 1   Description of Premises

Exhibit 2   RCRA Permit

Exhibit 3   Site Map

Exhibit 4   Description of Groundwater Recovery System
            Appendix 1 - As-Built Site Plan - 1 of 3 and Details - 2 of 6
            prepared by Sadat Associates, Inc.
            Appendix 2 - Wastewater Treatment Plant Layout - 2 of 3 and
            Wastewater Treatment Plant P& I - 3 of 3 prepared by Sadat
            Associates, Inc.
            Appendix 3 - Indirect Discharge Permit
            Appendix 4 - Deed Notice
            Appendix 5 - Easement

* Exhibits omittedExhibit 10.25

                             STOCKHOLDERS' AGREEMENT

            AGREEMENT dated as of the 5th day of January, 2000, by and among the
persons, firms and other entities set forth on Schedule A hereto (hereinafter
sometimes called collectively the "Shareholders" and individually a
"Shareholder").

                              W I T N E S S E T H:

            WHEREAS, each of Penick Corporation and Penick Pharmaceutical, Inc.
(collectively, "Penick") is a debtor in proceedings for a reorganization under
Chapter 11 of the Bankruptcy Code currently pending in the United States
Bankruptcy Court for the Eastern District of New York (the "Bankruptcy Court"),
Case Nos. 94 B 42808 and 94 B 42809 (collectively, the "Case"); and

            WHEREAS, Philipp Brothers Chemicals, Inc. ("PBC"), together with
Drew McManigle (the "Trustee"), the chapter 11 trustee of Penick, and Penick,
are joint proponents of the Plan of Reorganization dated September 30, 1999 (as
amended and resubmitted to the Bankruptcy Court from time to time, the "Plan")
and have submitted a related Disclosure Statement pursuant to ss.1125 of Title
11 of the United States Code to all holders of claims in order to solicit
acceptances or rejections of the Plan; and

            WHEREAS, in connection with the Plan, PBC has entered into an Escrow
Agreement (the "Escrow Agreement") dated September 7, 1999 with the Trustee,
pursuant to which PBC deposited with the escrow agent thereunder the sum of
$500,000 as earnest money (the "Deposit"); and

            WHEREAS, at a hearing on January 5, 2000, the Bankruptcy Court
confirmed the Plan, awarding Penick to PBC or a designee; and

            WHEREAS, the Shareholders have agreed to capitalize Penick Holding
Company, a Delaware corporation (the "Corporation"), in order to be the
purchaser under, and fulfill the purchaser's funding obligations in accordance
with, the Plan, and in connection therewith, the Shareholders have agreed to
purchase from the Corporation the number of shares of each class and series of
capital stock of the Corporation set forth on Schedule A hereto; and

            WHEREAS, the Shareholders desire to maintain ownership and control
of the Corporation between themselves for the purpose of insuring the continuity
of the management and policies of the Corporation and, in furtherance thereof,
to provide for the orderly disposition of the shares of the Corporation now
owned or hereafter acquired by each of them under certain circumstances;

            NOW, THEREFORE, in consideration of the premises and the mutual
covenants herein contained, the parties hereto, intending to be legally bound
hereby, agree as follows:

      1. Effective Date. This Agreement shall not become effective unless and
until a counterpart is executed and delivered by Shareholders investing in the
Corporation at least
<PAGE>

$4,500,000 (including the Deposit). In the event the acquisition (the
"Acquisition") by the Corporation contemplated by the Plan is not consummated by
March 7, 2000, and this Agreement shall theretofore have become effective by
reason of the acceptance by the Corporation of a stock subscription and
counterpart of this Agreement on behalf of Shareholders investing the requisite
amount, the Corporation, at the request of any Shareholder, shall take such
actions as shall effect as soon as practicable the return to each contributing
Shareholder of all amounts contributed by such Shareholder to the capital of the
Corporation or held by the Corporation as a contribution by such Shareholder to
such capital, with any interest earned thereon. Since the Plan is subject to
numerous terms and conditions, no representation or warranty is made that (a)
the transactions contemplated by the Plan will actually be consummated or (b) if
such transactions are consummated, that there will be no changes in, or waivers
of, any of the terms or conditions of the Plan.

      2. Subscription for and Purchase of Shares. (a) Each Shareholder hereby
agrees, solely as between the Shareholders (and not for the benefit of the
Corporation, Penick, the Trustee, the official committee (the "Creditors'
Committee") of unsecured creditors appointed by the Bankruptcy Court in the
Case, or any other third party), to invest in the Corporation (to the extent it
has not already done so), whether as initial share purchase price, additional
capital contributions or, if and upon such terms as the Corporation and the
Shareholders holding, in the aggregate, a majority interest in the Corporation
shall mutually determine, equipment or subordinated loans, in the amounts
specified therefor in Schedule A as its "Basic Commitment" plus PBC's rights as
a proponent of the Plan.

            (b) Upon signing this Agreement, each Shareholder shall deliver to
counsel to the Corporation to be held, until disbursed under the Plan or until
the closing under the Plan, in an escrow account for the benefit of the
Shareholders (the "Account") such Shareholder's Basic Commitment in full, as
specified in Schedule A, of which $500,000 of PBC's Basic Commitment has been
used as the earnest money deposit required to be made by the Corporation
pursuant to the Plan, and other funds have been used to conduct diligence and to
fund certain pre-closing disbursements under the Plan.

            (c) In furtherance thereof, the Shareholders have subscribed for the
number of shares of the Corporation, and agreed to pay $1,000.00 per share of
Preferred Stock and $9.84 per share of Common Stock or the aggregate amount
therefor, set forth on Schedule A in respect of their respective Basic
Commitments; provided, however, Aris Christodoulous has agreed to pay $1.00 per
share of Common Stock and to enter into a certain Consulting Agreement with the
Corporation in consideration thereof. In the event a Shareholder shall fail to
satisfy in full its Basic Commitment, without limiting any other right or remedy
of any other Shareholder, such non-contributing Shareholder shall not be
entitled to ownership of any securities of the Corporation, and the Corporation
shall have the right, for a period of ninety days, to repurchase such
Shareholder's shares of Preferred Stock and Common Stock at cost, without any
increase due to a dividend or for any other reason.

            (d) The Corporation shall not have any rights or remedies with
respect to the failure of a Shareholder to fulfill its Basic Commitment, such
obligations and all provisions of

                                       2
<PAGE>

this Agreement with respect thereto being solely an agreement among the
Shareholders, enforceable solely by them against the others and not otherwise.

            (e) The Corporation will pay or reimburse a Shareholder or affiliate
of a Shareholder for pre-incorporation expenses incurred by it in connection
with the organization of the Corporation, due diligence with respect to and the
acquisition of Penick, and related expenses, including such expenses of PBC
included in the Plan or Disclosure Statement and other such expenses upon
submission of vouchers or expense statements reasonably evidencing such
expenses. If, in connection with the initial funding of the Company required to
consummate the Plan, a Shareholder shall advance to the Company more than his or
its allocation specified in Schedule A, such Shareholder shall be entitled to
reimbursement of such over-advance, without interest.

      3. Management of the Corporation.

            (a) Each of the Shareholders agrees, from and after the date hereof,
so long as they shall own (or be deemed to own) shares of the Corporation, to
vote all of the shares of the Corporation now or hereafter owned and/or held of
record by such Shareholder so as to use their best efforts to elect and
thereafter for the term of this Agreement to continue in office a Board of
Directors of the Corporation, consisting of three (3) persons, designated as
follows (so long as such designating party shall own (or be deemed to own) at
least one-half of the aggregate shares of Common Stock heretofore and hereafter
from time to time issued to them, respectively):

            One person to be designated by PBC and Jack C. Bendheim (by the
decision of the holder or holders of a majority of the shares of Common Stock
owned by them); and

            One person to be designated by Peter Joseph; and

            One person to be designated by Daniel Strauss.

            The initial Board of Directors shall be comprised of the following
persons:

                        Jack C. Bendheim
                        Peter Joseph
                        Daniel Strauss

                  Jack C. Bendheim shall be Chairman of the Board of Directors,
as long as he and PBC shall own (or be deemed to own) at least one-half of the
aggregate shares of Common Stock heretofore or hereafter issued to them. Each of
the Shareholders agrees that the following persons shall be officers of the
Corporation, and that the other officers of the Corporation shall be determined
by the Board of Directors, each to hold such office or offices and to serve
until their respective successors shall have been elected and qualified, and
subject to removal at any time in accordance with the By-laws of the
Corporation:

                  Stuart Rose             President
                  Joseph M. Katzenstein   Treasurer and Secretary

                                       3
<PAGE>

The President , if not also a director, shall also be entitled to observe
meetings of the Board of Directors as the Board shall deem advisable.

            The Corporation's By-laws shall provide that any director may be
removed for cause by the Shareholders and that directors, other than the initial
directors specified above, may be removed without cause by the Shareholders. A
quorum for meetings of the Board of Directors shall consist of a majority of the
directors then in office.

            The obligations of the Shareholders to vote in accordance with the
terms of this paragraph 3(a) shall continue after a distribution of equity
securities of the Corporation unless and until there shall have been completed a
Qualified Distribution. For purposes of this Agreement, a "Qualified
Distribution" means an underwritten public offering by the Corporation of shares
of its equity securities in which the aggregate gross proceeds received by the
Corporation shall equal or exceed $10,000,000.

            (b) If there is a vacancy in the Board of Directors of the
Corporation during the period of time a Shareholder shall own (or be deemed to
own) at least one-half of the aggregate number of shares of Common Stock
heretofore and hereafter from time to time issued to such Shareholder, and such
vacancy shall be due to the death, removal or resignation of a director
designated by such Shareholder, such Shareholder shall be entitled to designate
a person to fill such vacancy in the Board of Directors, and each Shareholder
agrees to vote all of the shares of the Corporation owned and/or held of record
by such Shareholder in favor of the person designated by the Shareholder
entitled to designate the person whose directorship has been terminated.

            (c) Each of the Shareholders agrees to cause the persons designated
as directors by such Shareholder to resign as a director of the Corporation and
of the Corporation's subsidiaries, if any, in the event and at the time that
such Shareholder ceases to own (or be deemed to own) at least one-half of the
aggregate number of shares of Common Stock heretofore and hereafter from time to
time issued to such Shareholder, and, if necessary, to cause the shares of the
Corporation owned (and deemed owned) by such Shareholder to be voted for the
removal of any such director who refuses to resign.

            (d) In order to effectuate the foregoing voting agreements of the
parties hereto with respect to the election of directors of the Corporation, the
Shareholders grant to, and are deemed to have executed in favor of, each other
(and their respective permitted successors and assigns), an irrevocable proxy,
coupled with an interest, to vote all of the shares of the Corporation owned by
the grantor of the proxy in accordance with the voting agreements contained in
this paragraph, by a written consent of stockholders without a meeting or at a
meeting of the stockholders of the Corporation held to vote upon and elect such
directors.

            (e) Without the approval of Shareholders owning or holding of record
at least sixty percent (60%) of the then outstanding shares of Common Stock of
the Corporation, the Corporation shall not be permitted to take any of the
following actions:

                                       4
<PAGE>

            (i) sell substantially all of the assets of the Corporation for a
      purchase price which would yield, after accounting for outstanding
      indebtedness of the Corporation, total consideration, the proportionate
      share of which for a Shareholder would be less than the aggregate amount
      paid by such Shareholder for each share of the Corporation owned by him at
      the time of such proposed sale; provided however, that no such approval by
      a Shareholder shall be necessary if such proposed sale is to occur after
      the fifth anniversary of the date of the closing of the Acquisition;

            (ii) enter into business or businesses not related or incidental to
      the ownership or operation of a business that manufactures or imports
      opium or derivatives, or other narcotics or controlled substances, or
      crude amphotericin slurry ("CAS");

            (iii) enter into any agreement for the sale or purchase of assets
      by, or the provision of services by or to, the Corporation with any of the
      Shareholders or any entity controlled by, controlling or under common
      control with any of the Shareholders upon terms less favorable than those
      then generally available from or with unrelated third parties;

            (iv) by reclassification or recapitalization of its capital stock,
      including combination of the outstanding shares of its Preferred Stock or
      Common Stock into a smaller number of shares, or by merger of the
      Corporation with or into an entity controlled by, under common ownership
      or control with or controlling one or more of the then-shareholders of the
      Corporation, reduce or increase the relative interest of any one
      Shareholder disproportionately to that of the other Shareholders;

            (v) remove any director, or fill any vacancy on the Board of
      Directors, or elect or remove any officer of the Corporation;

            (vi) purchase or redeem any outstanding shares of the Corporation
      (other than pursuant to the provisions of this Agreement);

            (vii) merge, consolidate, liquidate or dissolve the Corporation; or

            (viii) amend the certificate of incorporation or by-laws of the
      Corporation.

      4. Restrictions on Transfer of Shares.

            (a) During the term of this Agreement and so long as there shall not
have been consummated a Qualified Distribution, no Shareholder, either directly
or indirectly, shall (whether by operation of law or otherwise) sell, assign,
mortgage, hypothecate, transfer, pledge, create a security interest in or lien
upon, encumber, give, place in trust, or otherwise voluntarily or involuntarily
dispose of (hereinafter collectively called "transfer") any or all of the shares
of the Corporation (or any right or interest therein) now owned or hereafter
acquired or owned by such Shareholder, except as hereinafter provided.

                                       5
<PAGE>

            (b) Notwithstanding the provisions of subparagraph 4(a) above, but
in each case subject to the provisions of paragraph 6 hereof,

                  (i) Each member of a Family Group (as set forth on Schedule B
      hereto) shall be under no restrictions (other than restrictions imposed by
      federal and state securities laws) as to the transfer by them of their
      shares of the Corporation to one or more other members of the same Family
      Group or to their respective permitted transferees specified in clause
      (ii) below; and

                  (ii) a Shareholder (including a shareholder who shall become a
      Shareholder after having been a permitted transferee of a Shareholder)
      shall have the right (subject to compliance with the provisions of
      subparagraph 4(c) below) at any time during the term of this Agreement to
      make the following transfers:

                        (A) if such Shareholder shall be a corporation or other
      non-individual, to individuals and entities which are and thereafter
      continue to be, controlled by, controlling or under common ownership and
      control with, such Shareholder or in the event of the liquidation or
      dissolution of such Shareholder, to its shareholders or other owners of
      the equity interests in such Shareholder;

                        (B) if such Shareholder shall be an individual, (1) to
      entities controlled by such individual Shareholder, (2) to the
      then-current spouse, parents or lineal descendants of such individual
      Shareholder or to trusts or custodianships established for or entities
      controlled by any of such persons, (3) by operation of law, (4) by
      disposition pursuant to the terms of such individual Shareholder's will,
      or (5) to such individual Shareholder's estate;

                        (C) in accordance with the provisions of paragraph 5
      hereof; or

                        (D) any shares effectively registered under the
      Securities Act of 1933, as amended (the "Securities Act"), in accordance
      with the intended method of disposition by the seller or sellers thereof
      set forth in the registration statement, or of any Shares previously
      effectively registered under the Securities Act and sold or otherwise
      disposed of in accordance with the intended method of disposition by the
      seller or sellers thereof set forth in such applicable registration
      statement.

            (c) Any transfer by a Shareholder to such a permitted transferee
referred to in clause (ii) (A) or (B) of subparagraph 4(b) of all or any part of
such Shareholder's shares of the Corporation (or in the event of any subsequent
permitted transfer by any such permitted transferee to another permitted
transferee) may be made provided that at the time of any such transfer, each
such transferee agrees in writing to be bound by all of the provisions of this
Agreement applicable to the transferor, and provides a copy thereof to each
Shareholder. In such event, such permitted transferees (including subsequent
permitted transferees hereunder) shall receive, hold and vote such shares
subject to the terms of this Agreement and the rights and obligations hereunder
of the Shareholder from whom such shares were originally transferred as though
such shares were still owned (and for purposes of this Agreement such shares
shall still

                                       6
<PAGE>

be deemed owned) by such Shareholder, and such Shareholder (together with all of
his permitted transferees) shall continue to be deemed a single Shareholder for
purposes of paragraphs 2 and 3 hereof (the rights of which under this Agreement
shall be exercised by a majority in interest thereof) and in the case of such a
transfer by a Shareholder prior to the death of such Shareholder, the permitted
transferees thereof shall not be deemed Shareholders for the purpose of this
Agreement, except as otherwise expressly provided in this Agreement. Upon a
transfer of such Shareholder's shares of the Corporation by will, or by the laws
of descent and distribution, as permitted by this Agreement, such recipients
shall be deemed for all further purposes hereof to be Shareholders hereunder and
parties hereto provided that each such permitted transferee complies with the
provisions of this subparagraph. There may be further transfers of such shares
by a permitted transferee to permitted transferees of such permitted transferee.

            (d) As used in this Agreement, the term "Permitted Transferee" shall
mean any transferee pursuant to clause (i) or, subject to subparagraph (c)
above, clause (ii)A or (B) of subparagraph 4(b), and the term "shares" shall
have reference to and also include Preferred Stock, Common Stock, certificates
therefor, script representing fractional shares thereof, options and warrants
for Preferred Stock, Common Stock or any other shares, as well as shares
received by way of dividend, additional issuance or upon an increase, reduction,
substitution or reclassification of shares or upon any merger or reorganization
of the Corporation.

      5. Sale of Shares.

            (a) If any Shareholder (the "Selling Shareholder") desires to
dispose (other than a transfer to a Permitted Transferee, or pursuant to a
merger or reorganization transaction to which the Corporation is a party), in a
bona fide arm's-length third-party transaction, of any or all of his shares of
the Corporation (the "Offered Shares"), pursuant to a written offer (the
"Offer") received from a proposed third-party purchaser, at any time after to
the earlier of (i) the fifth anniversary of the date of the closing of the
Acquisition and (ii) the consummation of a Qualified Distribution, the Selling
Shareholder shall promptly furnish written notice (the "Notice") to the
Corporation and to each other Shareholder (provided that such other Shareholder
then owns or is deemed to own shares of the Corporation). Each such notice shall
be accompanied by a photocopy of the original or most recent third-party offer,
setting forth in reasonable detail the terms and conditions of the Offer and the
name, address and telephone number of the party or parties marking the Offer.
The Notice shall constitute both:

                  (i) an offer to sell, at the same price per share and upon the
            same terms and conditions as set forth in the Offer (except as
            otherwise provided in subparagraph (5(j) below), all, but not less
            than all, of the Offered Shares to (A) the other Shareholders, pro
            rata based on the relative number of shares of Common Stock owned of
            record or which would be owned of record upon conversion of
            preferred shares by each of them on the date of the Offer or in such
            other proportions as the other Shareholders may agree, and (B) the
            Corporation, to the extent only of any shares of Common Stock that
            the other Shareholders do not agree to purchase; and

                                       7
<PAGE>

                  (ii) in the alternative, an offer for the other Shareholders
            to participate in the Offer on the same term as, and pro rata with,
            the Selling Stockholder.

Any determination of the number of shares of Common Stock to be offered to each
other Shareholder on the pro rata basis described above shall be made by the
Corporation and any such determination shall be binding on all of the
Stockholders. To be deemed to be a "bona fide offer" within the meaning of this
paragraph, an offer must be signed by the maker of such offer, who must be
financially capable of carrying out the terms of the offer and who must not be
an offeror prohibited from becoming a transferee by reason of paragraph 6 below
(a "Qualified Offeror").

            (b) Each of the other Shareholders shall have a period of 60 days
form the date of the Notice to notify the Selling Shareholder, the remaining
other Shareholders and the Corporation that such Shareholder agrees either to
(i) purchase all or a portion of the Offered Shares offered to such Stockholder
on the terms set forth in the Offer or (ii) to participate in the Offer on the
same terms as, and pro rata with, the Selling Shareholder. If one, but not all,
of the other Shareholder elects to participate in the Offer with the Selling
Shareholder, the election of the remaining other Shareholders to purchase the
Offered Shares shall take precedence and the provisions of paragraph 4(c) shall
govern.

            (c) Any Offered Shares which any of the other Shareholders do not
agree in writing within such 60-day period to purchase shall be deemed to be
re-offered for sale to the remaining other Shareholders who had agreed to them,
on the terms set forth in the Offer, pro rata based on the relative number of
Offered Shares that each of them had previously agreed to purchase or in such
other proportions as they may agree, and such remaining other Shareholders shall
have an additional five days to agree in writing to purchase such Offered
Shares. Any such Offered Shares which the remaining other Shareholders do not
agree in writing within such five-day period to purchase shall be deemed to be
re-offered for sale to the Corporation on the terms set forth in the Offer, and
the Corporation shall have an additional five days to agree in writing to
purchase such Offered Shares. If the other Shareholders and the Corporation have
agreed within such total 20-day period to purchase all of the Offered Shares
among them, the parties shall proceed to consummate such purchases not later
than the 90th day following the date of the Notice.

            (d) If all of the other Shareholders timely agree in writing to
participate in the Offer with the Selling Shareholder, the parties shall proceed
together to consummate such transaction with the third party identified in the
Notice. The total number of Shares to be sold in the transaction shall be
divided among the participating Shareholders in proportion to their then
respective percentage shareholdings in the Corporation, notwithstanding that the
Offer was originally made only to the Selling Shareholder. The Shareholders
shall share all costs in connection with the transaction equally. The
Shareholders shall consummate the transaction simultaneously and no
participating Shareholder shall consummate such transaction without the other.

            (e) If the other Shareholders and the Corporation do not agree in
writing within 70 days after the date of the Notice either to purchase all of
the Offered Shares among

                                       8
<PAGE>

them or, in the case only of the other Shareholders, to participate in the
Offer, the Selling Shareholder shall have the right to sell to the Qualified
Offeror identified in the Offer all of the Offered Shares for a period of 60
days following such 60th day, such sale to be at no less favorable price and
upon terms and conditions no less favorable to the Selling Shareholder than as
set forth in the Offer. All shares so sold to such Qualified Offeror shall
thereupon become subject to the restrictions of this Agreement, except that no
such Qualified Offeror shall be entitled to any of the rights of a Shareholder
set forth in or under paragraph 3 or 5(a)(ii) hereof. If the Selling Shareholder
fails to sell the Offered Shares to such party on such terms and conditions
within such 60-day period, the Offered Shares shall again be subject to the
provisions of this paragraph 5.

            (f) If the Qualified Offeror makes one or more new bona fide offers
at a lower price or upon terms which are more favorable to such Qualified
Offeror than those previously offered by the offeror to the other Shareholders
and the Corporation, then each new bona fide offer shall be treated as a new
bona fide offer subject to the provisions set forth in this paragraph 5, except
that the sixty (60) day offering period provided in subparagraph (b) above shall
be thirty (30) days; provided, however, that if any such thirty (30) day period
would terminate on a date prior to the date on which such period would have
terminated without giving effect to the new bona fide offer, then such period
shall continue until the original period's termination date.

            (g) For purposes hereof, a "third-party transaction" shall not
include, and a "third-party purchaser" does not refer to, any person or entity
that is a Shareholder or could be a Permitted Transferee of the offeror pursuant
to subparagraph 4(b) above or is controlled by, controlling or under common
control with, the offeror.

            (h) In the event that any Shareholder offers or is deemed to have
offered his or her shares of the Corporation for sale pursuant to this paragraph
5 (such Shareholder being referred to as "First Offeror" herein) and during the
offering periods applicable to such shares another Shareholder offers or is
deemed to have offered his or her shares of the Corporation for sale (such other
Shareholder being referred to as "Second Offeror" herein), the offering periods
with respect to the shares of the Second Offeror shall not commence until the
last offer of the First Offeror is accepted or expires hereunder. In such event,
the Second Offeror shall not be entitled to purchase or receive any further
offers with respect to any shares of the First Offeror and all prior offers made
to such Second Offeror shall be deemed cancelled and terminated.

            (i) As used in this paragraph 5, the requirement that any purchase
of the offeror's shares by the Corporation and/or any offeree Shareholder
pursuant to this paragraph 5 be at the "same price per share and upon the same
terms and conditions" as the offer to purchase such shares by a proposed
third-party purchaser may be met in accordance with the rules and guidelines set
forth in Appendix A hereto.

            (j) The offeror shall, at the request of a majority in voting
interest of the other Shareholders, take such action as is necessary and lawful
(i) to permit the Corporation's decision with respect to its acceptance of any
offer made to it under this paragraph 5 (to be decided by a majority in voting
interest of the other Shareholders) and (ii) to enable the Corporation to accept
such offer to the extent desired by a majority in voting interest of the other
Shareholders to the

                                       9
<PAGE>

fullest extent permitted by law, including, but not limited to, the creation of
corporate debt and the creation of legally available surplus (whether by
reduction of capital, revaluation of assets or otherwise).

            (k) The options and rights granted under this paragraph 5 shall be
assignable among members of the same Family Group, and the rights and
obligations of the Corporation may be assigned by the Corporation, provided that
the Corporation may not assign such rights to a Shareholder without the
unanimous approval of the Board of Directors.

      6. Certain Prohibited Transfers. Any transfer of shares of the Corporation
otherwise permitted under this Agreement shall require prior approval of the
Board of Directors of the Corporation if such transfer is to any individual or
entity (other than a Shareholder) which is any of the following: (i) a
competitor of the Corporation or any subsidiary thereof; (ii) any company which
has a class of securities registered with the Securities and Exchange
Commission; (iii) an individual or entity that would cause, by its ownership or
voting of such shares, a default under any loan documentation to which the
Corporation or any subsidiary thereof or any Shareholder then is a party or by
which the Corporation or any subsidiary thereof or any Shareholder is bound or
would adversely affect the ability of the Corporation or any subsidiary thereof
to maintain any license or permit or comply with any law, rule or regulation
applicable to the Corporation or any subsidiary; (iv) an entity controlled
directly or indirectly by any government or political subdivision thereof; (v)
an individual or entity for which such ownership or voting of shares would
conflict with, or result in a breach or violation of any law, rule or regulation
applicable to the Corporation or any subsidiary thereof, or would require prior
approval of any governmental department, entity, bureau, commission,
administration or other body, which approval has not been obtained; (vi) any
individual or entity controlled by, controlling or under common control with any
of those persons or entities described in clauses (i) - (v) immediately above.

      7. Drag Along Rights.

            (a) If the Company or a Shareholder receives a bona fide arm's
length outside offer (the "Outside Offer") from a third party to purchase all of
the shares of the Corporation, which at least sixty percent (60%) in interest of
the Shareholders (the "Initiating Shareholders") desire to accept, the
Initiating Shareholders may give the other Shareholders written notice (an
"Outside Offer Notice") setting out the following details of the proposed
purchaser, namely (i) the full name and address of the proposed purchaser and
(ii) the full terms and conditions of the proposed offer, including the price
payable per share.

            (b) If the Outside Offer is a bona fide arms-length offer from a
third party purchaser unconnected with any Shareholder then, provided that the
net proceeds resulting from such sale payable to the holders of preferred shares
of the Corporation or in respect of their preferred shares shall exceed the
outstanding liquidation preference (including accrued dividends) on such
preferred shares and be payable in cash in freely convertible currency at the
closing of such sale, the Initiating Shareholders shall be entitled to require
the other Shareholders, which shall be obliged, to join with them in accepting
the Outside Offer and to sell

                                       10
<PAGE>

the shares of the Corporation held by them to the said third party purchaser
upon the terms and conditions of the Outside Offer, by written notice to that
effect (a "Drag-Along Notice"), which notice may be the Outside Offer Notice. In
such event, the Shareholders shall do all things necessary to consummate such
sale as soon as practicable, but in any event within sixty days of the date of
the Drag-Along Notice.

      8. Reports to Shareholders.

            (a) At all times during the term of this Agreement, the Shareholders
shall keep or cause to be kept true and correct books of account, in which shall
be entered fully and accurately each transaction of the Corporation and its
subsidiaries. Such books of account shall at all times be maintained at the
principal office of the Corporation and shall be open to the reasonable
inspection and examination of the Shareholders or their duly authorized
representatives during normal business hours.

            (b) Annual financial reports of the Corporation and its
subsidiaries, in such form and subject to such a compilation, review or audit by
the Corporation's regularly engaged public accountants as the Board of Directors
shall determine, shall be transmitted to each of the Shareholders not later than
four (4) months after the end of each fiscal year of the Corporation. Quarterly
and other reports will be prepared in such form and in such detail (but not to
be audited) as the Board of Directors shall determine, and promptly transmitted
to each of the Shareholders.

      9. Unrelated Business Interests. The Shareholders agree amongst themselves
(without affecting the Corporation) that each Shareholder and the officers,
directors and shareholders thereof may engage in other activities unrelated to
the Corporation, and may engage in or possess an interest in other business
ventures of any nature and description, independently or with others, including
but not limited to the ownership, financing, leasing, operation, management,
manufacturer and marketing of specialty chemicals, the manufacture or
importation of opium or derivatives or other narcotics or controlled substances,
and of investment, brokerage and financial services activities, subject to
general principles of fiduciary duty and corporate opportunity that may be
applicable. Neither the Corporation nor any of the Shareholders shall have any
rights, by virtue of this Agreement, in or to any such independent activities or
ventures of the others. Except as provided in subparagraph 3(e)(iii) above, the
fact that a Shareholder, or any person or entity controlling, controlled by or
under common control with such Shareholder, is employed by, or directly or
indirectly is interested in or connected with, any person, firm or corporation
employed by the Corporation to render or perform a service, or from whom the
Corporation may buy or sell merchandise or other property, or to or from whom
the Corporation may lease or sell any of its assets, shall not prohibit the
Shareholders or the Corporation from executing any agreement or engaging in any
transaction with, or employing, such person, firm or corporation or from
otherwise dealing with him or it, and neither the Corporation nor any of the
Shareholders, as such, shall have any rights in or to any income or profits
derived therefrom; provided, however, that no Shareholder shall directly
participate in or recommend any such agreement, transaction or dealings, or
permit any of its affiliated persons or entities to engage therein, unless such
agreement, transaction or dealings is or

                                       11
<PAGE>

are in all respects on bona fide, arm's-length terms no less favorable to the
Corporation than terms obtainable by it from or with unrelated persons or
entities.

      10. Application of Agreement to After-Acquired Shares. All of the
provisions of this Agreement shall apply to all of the shares of the Corporation
now owned or which may be issued or transferred hereafter to a Shareholder or to
his transferees in consequence of any additional issuance, purchase, exchange or
reclassification of shares, corporate reorganization, or any other form of
recapitalization, or consolidation, or merger, or share split, or share
dividend, or which are acquired by a Shareholder in any other manner.

      11. Specific Performance. Inasmuch as the shares of the Corporation are
closely held and the market therefor is limited, irreparable damage would result
if this Agreement is not specifically enforced. Therefore, the rights and
obligations to offer for sale shares of the Corporation, and to vote shares of
the Corporation, as provided herein, shall be enforceable in a court of equity
by a decree of specific performance and appropriate injunctive relief may be
applied for and granted in connection therewith (in each case, without any
showing of actual damages or that monetary relief would not provide an adequate
remedy), without any bond or other security being required. Such remedies shall,
however, be cumulative and not exclusive and shall be in addition to any other
remedies which any party may have under this Agreement or otherwise.

      12. Legend.

            (a) Each certificate representing shares of the Corporation of which
a Shareholder is a record or beneficial owner shall have stamped, printed or
typed thereon the following legend:

                  "The securities represented by the certificate have not been
            registered under the Securities Act of 1933, as amended, or under
            any applicable state securities laws, and may only be sold or
            transferred in compliance with such Act and such state securities
            laws. The sale, assignment, transfer, pledge or hypothecation of the
            shares represented by this certificate is subject to a certain
            Stockholders' Agreement, dated as of January 5, 2000 and any
            amendments thereto, a signed counterpart of which is on file at the
            office of the Corporation."

            (b) The Corporation shall not at any time permit any transfer to be
made on its books or records of the certificates representing the shares of any
of the parties hereto unless such transfer is made pursuant to and is in
accordance with the terms and conditions of this Agreement.

      13. Complete Agreement; Waivers. This Agreement constitutes the complete
understanding among the parties hereto, and no modification or amendment of any
of the terms and provisions hereof shall be valid unless made pursuant to an
instrument in writing signed by each of said parties. No waiver of any breach or
default hereunder shall be considered valid unless in writing, and no such
waiver shall be deemed a waiver of any subsequent breach or default of the same
or similar nature. Anything in this Agreement to the contrary

                                       12
<PAGE>

notwithstanding (and without limiting the rights of the owners of all of the
then outstanding shares to amend, modify or terminate this Agreement), any
modification, amendment or termination of this Agreement, and any waiver,
consent or other instrument under or pursuant to this Agreement, by a written
agreement signed by a "Shareholder" as defined in the introductory paragraph of
this Agreement, shall be valid and binding upon any and all persons or entities
(other than the Corporation) who may, at any time, have or claim any rights
under or pursuant to this Agreement in respect of the shares originally acquired
by such Shareholder to the extent that such modification, amendment or
termination would have been binding upon such Shareholder if he had owned such
shares at the time thereof.

      14. Reduction of Capital to Create Surplus. In the event that at any time
the Corporation's surplus shall be insufficient to enable the Corporation to
purchase or to make any payment due with respect to shares which it elects or
agrees to purchase, the Shareholders (for themselves and their respective heirs,
successors, personal representatives and assigns) agree that they shall
forthwith take appropriate steps to effect a sufficient reduction of the stated
capital of the Corporation to enable such purchase or payments to be made;
provided, however, that if a Shareholder, other than the seller, so desires, he
may (but shall not be obligated to) in lieu of effecting a reduction of the
stated capital of the Corporation, elect to contribute to the Corporation a
sufficient amount of cash to enable the Corporation to purchase such shares or
to make any payment or payments due hereunder. Solely for the purpose of
effecting such reduction in stated capital, the Shareholders grant to, and are
hereby deemed to have executed in favor of each other (and their respective
permitted successors and assigns):

            (i) an irrevocable proxy to vote all of the shares of the
      Corporation owned by the grantor of the proxy in favor of a reduction in
      stated capital by a written consent of stockholders without a meeting or
      at a meeting of the stockholders of the Corporation held to vote upon and
      authorize such reduction in stated capital; and

            (ii) an irrevocable power of attorney to sign and file any and all
      papers required to be signed and filed by the grantor of the power of
      attorney in order to effect the requisite reduction in stated capital.

      15. Termination. This Agreement shall terminate:

            (i) upon the mutual consent in writing of all of the then
      Shareholders; or

            (ii) upon the consummation of a Qualified Distribution, except for
      paragraph 6 which shall survive; or

            (iii) upon the sale as herein permitted of all of the outstanding
      shares of the Corporation held by all but one of the then Shareholders.

Nothing contained in this paragraph 15 shall effect or impair any rights or
obligations arising prior to the time of the termination of this Agreement as
herein provided, or which may arise by an event causing the termination of this
Agreement.

                                       13
<PAGE>

      16. Successors and Assigns. All of the terms and provisions of this
Agreement shall inure to the benefit of and shall be binding upon the heirs,
personal representatives, successors and assigns of the respective parties
hereto; provided, however, that nothing contained herein shall be construed as
granting any Shareholder the right to transfer any of his shares except as
permitted by this Agreement.

      17. Governing Law. This Agreement has been made in and shall be governed
by and construed and enforced in accordance with the laws of the State of New
York.

      18. Notices. All notices, offers, acceptances, and other communications
permitted or required hereunder shall be sufficiently given and shall be deemed
effective on receipt if personally delivered (by courier or otherwise) or sent
by air mail, postage prepaid, or by facsimile or telex (with confirmed
answerback), if to any or all of the Shareholders, to each such party's address
set forth at the head of this Agreement and with a copy to the Corporation at
its then principal office. Any party hereto may change the address to which each
such notice or communication shall be sent, or may request that a copy thereof
be sent to another person, by giving written notice as aforesaid to all of the
other parties hereto of such address or person.

      19. Paragraph Headings. The paragraph headings contained in this Agreement
are for convenience of reference only and shall not affect the meaning or
interpretation hereof.

      20. Severability. In the event that any provision of this Agreement would
be held to be invalid, prohibited or unenforceable in any jurisdiction for any
reason, unless narrowed by construction, this Agreement shall, as to such
jurisdiction, be construed as if such invalid, prohibited or unenforceable
provision had been more narrowly drawn so as not to be invalid, prohibited or
unenforceable. If, notwithstanding the foregoing, any provision of this
Agreement would be held to be invalid, prohibited or unenforceable in any
jurisdiction for any reason, such provision, as to such jurisdiction, shall be
ineffective to the extent of such invalidity, prohibition or unenforceability,
without invalidating the remaining provisions of this Agreement or affecting the
validity or enforceability of such provision in any other jurisdiction.

      21. Further Action. Each party hereto shall cooperate and shall take such
further action and shall execute and deliver such further documents as may be
reasonably requested by any other party in order to carry out the provisions and
purposes of this Agreement.

      22. Pronouns. Pronouns used herein shall be deemed to be and include
pronouns of the male, female and/or neuter gender whenever applicable. Words in
the singular shall be read and construed as though in the plural and words in
the plural shall be read and construed as though in the singular in all cases
where they would so apply.

      23. Several Liabilities. The obligations of the Shareholders hereunder are
several and not joint.

      24. Counterparts. This Agreement may be executed in one or more
counterparts which, when taken together, shall constitute one complete, executed
Agreement.

                                       14
<PAGE>

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

PHILIPP BROTHERS CHEMICALS, INC.        PBCI LLC

By: /s/                                 By: /s/
   --------------------------------        -------------------------------------

/s/                                     /s/
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/s/                                     /s/
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/s/                                     /s/
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/s/                                     /s/
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/s/                                     /s/
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/s/                                     /s/
-----------------------------------     ----------------------------------------

                                       15
<PAGE>

                                                                      Appendix A

                              Rules and Guidelines
                                 for determining
                      Price, Terms and Conditions of Offers

      1. If a proposed third-party purchaser offers to pay the entire purchase
price in cash or by check upon the transfer of all of the shares of the
Corporation to be purchased thereby, or in one or more installments payable from
time to time (collectively referred to as "Money"), such requirement may be met
by the offeree(s) hereunder offering and paying the selling Shareholder the
exact same sum as that offered by the proposed third-party purchaser, in cash or
by check, and/or by the delivery of instruments of indebtedness in the
proportionate share of each offeree upon the same date or dates and at the same
rate of interest, if any.

      2. If a proposed third-party purchaser offers payment in whole or in part
with property other than Money, such requirement may be met by each offeree
hereunder paying the selling Shareholder his proportionate share of the "cash
equivalent" (as hereinafter defined) of such other consideration, valued as at
the end of the calendar month immediately preceding the month in which the offer
or sale is first made to the Corporation (the "Determination Date").

      3. If a proposed third-party purchaser offers collateral and/or
third-party guarantees in connection with the unpaid portion of the purchase
price, if any, such requirement may be met by the offeree(s) hereunder pledging
in lieu thereof the shares purchased pursuant to such offer as collateral
security for and until the full payment of the purchase price therefor.

      4. Each Shareholder acknowledges that a comparison of an offer to purchase
shares of the Corporation made by a proposed third-party purchaser, on the one
hand, and the Corporation and/or another Shareholder, on the other hand, which
is payable in one or more deferred payments may involve an assessment of the
credit risk with respect to a particular payor. Each Shareholder further
acknowledges that an offer may involve additional terms (including, without
limitation, a pledge of collateral or guarantee by or on behalf of a proposed
purchaser, or management or insurance or reinsurance arrangements) the value of
which may be difficult to ascertain. Each of the Shareholders, being fully aware
of the foregoing, hereby waives any and all right to claim that an offer is not
at the "same price per share and upon the same terms and conditions" due to
differences in the creditworthiness of a proposed third-party purchaser and an
offeree, the quality of collateral offered, if any, or due to any such other
terms or conditions; provided, however, that the offeree or offerees hereunder
shall have complied with the provisions of subparagraphs (1), (2) and/or (3)
above to the extent applicable.

      5. For the purposes hereof, "cash equivalent" shall mean the fair market
value, in cash, as of the Determination Date of the consideration other than
Money offered by the proposed purchaser.

                                       1
<PAGE>

      6. Notwithstanding anything contained in this Agreement to the contrary,
if the Corporation and each other Shareholder receive a notice (the date of the
receiving of such notice being herein called the "notice date") from a
Shareholder of an offer from a proposed third-party purchaser payable, in whole
or in part, in consideration other than Money, the period of time from the
notice date to the date on which the cash equivalent of such consideration is
determined shall be excluded in determining all applicable offering periods
provided for in paragraph 5. Upon receipt by the Corporation of such a notice,
the Corporation and the selling Shareholder giving such notice shall use their
best efforts to determine and agree upon the fair market value, in cash (and
assuming payment in full at the closing) of the portion of the consideration not
payable in Money. If the fair market value of such consideration cannot be
resolved to the satisfaction of the Corporation and the selling Shareholder
within five (5) business days after the notice date, application shall be made
promptly thereafter by either the Corporation or the selling Shareholder to the
President of the American Arbitration Association, who shall appoint an
appraiser. The determination by such appraiser of the fair market value of such
consideration shall be made, at the expense of the selling Shareholder, as of
the applicable Determination Date and shall be final, conclusive and binding
upon the Corporation and the selling Shareholder. Such appraiser shall, as soon
as possible after receiving a written request from either the Corporation or the
selling Shareholder, make a determination of the fair market value of such
consideration and shall furnish a certificate setting forth such determination
to the Corporation. The Corporation shall promptly forward a copy of such
certificate to each other Shareholder and the selling Shareholder.

                                       2
<PAGE>

                                                           STATE OF DELAWARE
                                                          SECRETARY OF STATE
                                                       DIVISION OF CORPORATIONS
                                                       FILED 09:00 AM 11/18/1999
                                                          991493652 - 3128346

                          CERTIFICATE OF INCORPORATION

                                       OF

                             PENICK HOLDING COMPANY

            The undersigned, a natural person, for the purpose of organizing a
corporation for conducting the business and promoting the purposes hereinafter
stated, under the provisions and subject to the requirements of the laws of the
State of Delaware (particularly Chapter 1, Title 8 of the Delaware Code and the
acts amendatory thereof and supplemental thereto, and known, identified and
referred to as the "General Corporation Law of the State of Delaware"), hereby
certifies that:

            FIRST: The name of the corporation (hereinafter called the
"corporation") is:

                             Penick Holding Company

            SECOND: The address, including street, number, city and county, of
the registered office of the corporation in the State of Delaware is 1013 Centre
Road, in the City of Wilmington, County of New Castle, State of Delaware
19805-1297; and the name of the registered agent of the corporation in the State
of Delaware at such address is Corporation Service Company.

            THIRD: The nature of the business and the purposes to be conducted
and promoted by the corporation is:

            to engage in any lawful act or activity for which corporations may
be organized under the General Corporation Law of the State of Delaware.

            FOURTH: (a) The total number of shares of stock which the
corporation shall have the authority to issue is 25,000, which are divided into
10,000 shares of Common Stock, par value $.0001 per share, and 15,000 shares of
Preferred Stock, par value $.0001 per share.

                  (b) The Board of Directors is hereby expressly granted
authority to authorize, from time to time in accordance with law, the issue of
one or more series of Preferred Stock and with respect to any such series to fix
by resolution or resolutions the numbers, powers, designations, preferences and
relative, participating, optional or other special rights of such series and the
qualifications, limitations or restrictions thereof, including, but without
limiting the generality of the foregoing, the following:

                        (i) The number of shares to constitute such series and
            the distinctive designations thereof;

                        (ii) The dividend rate to which such shares shall be
            entitled and the restrictions, limitations and conditions upon the
            payment of
<PAGE>

            such dividends, whether dividends shall be cumulative, the date or
            dates from which dividends (if cumulative) shall accumulate and the
            dates on which dividends (if declared) shall be payable;

                        (iii) Whether or not the shares of such series shall be
            redeemable and, if so, the terms, limitations and restrictions with
            respect to such redemption, including without limitation the manner
            of selecting shares for redemption if less than all shares are to be
            redeemed, and the amount, if any, in addition to any accrued
            dividends thereon, which the holders of shares of such series shall
            be entitled to receive upon the redemption thereof, which amount may
            vary at different redemption dates and may be different with respect
            to shares redeemed through the operation of any purchase, retirement
            or sinking fund and with respect to shares otherwise redeemed;

                        (iv) The amount in addition to any accrued dividends
            thereon which the holders of shares of such series shall be entitled
            to receive upon the voluntary or involuntary liquidation,
            dissolution or winding up of the corporation, which amount may vary
            at different dates and may vary depending on whether such
            liquidation, dissolution or winding up is voluntary or involuntary;

                        (v) Whether or not the shares of such series shall be
            subject to the operation of a purchase, retirement or sinking fund
            and, if so, the terms, limitations and restrictions with respect
            thereto, including without limitation whether such purchase,
            retirement or sinking fund shall be cumulative or non-cumulative,
            the extent to and the manner in which such fund shall be applied to
            the purchase, retirement or redemption of the shares of such series
            for retirement or to other corporate purposes and the terms and
            provisions relative to the operation thereof;

                        (vi) Whether or not the shares of such series shall have
            conversion privileges and, if so, prices or rates of conversion and
            the method, if any, of adjusting the same;

                        (vii) The voting powers, if any, of such series; and

                        (viii) Any other relative rights, preferences and
            limitations pertaining to such series.

                                      -2-
<PAGE>

            FIFTH: The name and the mailing address of the incorporator are as
follows:

                        Richard S. Kaplan, Esq.
                        Golenbock, Eiseman, Assor & Bell
                        437 Madison Avenue
                        New York, New York 10022

            SIXTH: The corporation shall have the power to indemnify and advance
expenses to any person to the full extent permitted from time to time by the
General Corporation Law of the State of Delaware.

            The indemnification and advancement of expenses provided by this
Article shall not be deemed exclusive of any other rights to which those seeking
indemnification or advancement of expenses may be entitled under any by-law,
agreement, vote of stockholders or disinterested directors or otherwise, both as
to action in such person's official capacity and as to action in another
capacity while holding such office, and shall continue as to a person who has
ceased to be a director, officer, employee or agent and shall inure to the
benefit of the heirs, executors and administrators of such a person.

            SEVENTH: To the fullest extent permitted by the General Corporation
Law of the State of Delaware, as the same exists or may hereafter be amended, a
director shall not be liable to the corporation or its stockholders for monetary
damages for breach of fiduciary duty as director.

            EIGHTH: The corporation is to have perpetual existence.

            NINTH: In furtherance and not in limitation of the powers conferred
upon the stockholders by statute, the board of directors of the corporation is
expressly authorized to make, alter or repeal the by-laws of the corporation,
subject to the power of the stockholders to alter or repeal the by-laws made or
altered by the board of directors.

            TENTH: Except as otherwise required in the by-laws of the
corporation, election of directors need not be by written ballot.

            Signed at New York, New York on November 18, 1999.

                                        /s/ Richard S. Kaplan
                                        ----------------------------------------
                                        Richard S. Kaplan,
                                        Incorporator

                                      -3-
<PAGE>

    STATE OF DELAWARE
   SECRETARY OF STATE
DIVISION OF CORPORATIONS
FILED 09:00 AM 1/04/2000
  001003926 - 3128346

                     CERTIFICATE OF DESIGNATION, PREFERENCES
                        AND RIGHTS OF SERIES A REDEEMABLE
                           CUMULATIVE PREFERRED STOCK
                                       OF
                             PENICK HOLDING COMPANY

            PENICK HOLDING COMPANY, a corporation organized and existing under
the General Corporation Law of the State of Delaware (the "Corporation"), DOES
HEREBY CERTIFY THAT:

            Pursuant to authority conferred upon the Board of Directors by the
Certificate of Incorporation of the Corporation (the "Certificate of
Incorporation") and pursuant to the provisions of ss.151 and ss.141 of the
Delaware General Corporation Law, the Board of Directors, by unanimous written
consent dated January 3, 2000, adopted the following resolution providing for
the designation, preferences and relative, participating, optional and other
rights, and the qualifications, limitations and restrictions of the Series A
Redeemable Cumulative Preferred Stock;

            WHEREAS, the Certificate of Incorporation of the Corporation
provides for two classes of shares, one known as common stock, $.001 par value
per share (the "Common Stock"), and one known as preferred stock, $.001 value
per share (the "Preferred Stock"); and

            WHEREAS, the Board of Directors of the Corporation is authorized by
the Certificate of Incorporation to provide for the issuance of the shares of
Preferred Stock in series, and by filing a certificate pursuant to the
applicable law of the State of Delaware, to establish from time to time the
number of shares to be included in such series and to fix the designation,
preferences and rights of the shares of each such series and the qualifications,
limitations and restrictions thereof.

            NOW, THEREFORE, BE IT RESOLVED, that the Board of Directors deems it
advisable to, and hereby does, designate a Series A Redeemable Cumulative
Preferred Stock and fixes and determines the rights, preferences,
qualifications, limitations and restrictions relating to the Series A Redeemable
Cumulative Preferred Stock as follows:

      1. Designation; Ranking. The shares of such series of Preferred Stock
shall be designated "Series A Redeemable Cumulative Preferred Stock" which shall
be senior to all other capital stock of the Corporation with respect to
dividends, redemption and distributions upon the liquidation, dissolution or
winding-up of the Corporation (referred to herein as the "Series A Preferred
Stock").

<PAGE>

      2. Authorized Number. The number of shares constituting the Series A
Preferred Stock shall be 12,000.

      3. Dividends. (a) The holders of record of shares of Series A, Preferred
Stock shall be entiled to receive regular cash dividends, when and as declared
by the Board of Directors, at the annual rate of $85 per share, all of which
dividends shall be cumulative and shall be deemed to accrue from and after the
date of the issuance of such shares, whether or not earned or declared and
whether or not there be funds legally available therefor; provided, however,
that upon the occurrence of a Corporate Transaction (as defined in Section 4(b)
below), the right to such dividends shall terminate and cease to accrue as of
the date of original issue. All dividends shall be payable in cash upon the
earlier to occur of a Liquidation (as defined in Section 4(a) below) or a
Corporate Transaction, except that in lieu of cash, such dividends shall be
payable in shares of Series A Preferred Stock, the number of shares being
determined pursuant to subparagraph (c) hereof , if agreed to by holders of at
least a majority in interest of the Series A Preferred Stock then outstanding.
Any written instructions or determination delivered to the Corporation and
purporting to be the agreement of the holders of such requisite percentage of
the Series A Preferred Stock outstanding shall be final, conclusive and binding
upon the holders of all of the Series A Preferred Stock outstanding shall be
final, conclusive and binding upon the holders of all of the Series A Preferred
Stock. If the Corporation does not receive written direction as to whether such
holders desire to receive Series A Preferred Stock or cash for any dividend by
the date such dividend shall be payable, Series A Preferred Stock shall be
issued.

            (b) If, for any dividend accrual period, dividends at the rate
hereinabove specified are not declared and paid or set aside for payment, the
amount of accrued but unpaid dividends shall accumulate, and shall be added to
the dividends payable for subsequent dividend accrual periods. If the funds
legally available for the payment of such dividends are insufficient to pay in
full the dividends payable on all outstanding shares of Series A Preferred
Stock, the total available funds may be paid in partial dividends to the holders
of the outstanding shares of Series A Preferred Stock ratably in proportion to
the full dividends to which they are entitled. No dividend or distribution in
cash or other property (other than a stock dividend payable solely in shares of
Common Stock) on any other class of stock of the Corporation shall be declared
or paid or set apart for payment unless dividends on the Series A Preferred
Stock have been paid in full and then only if the Corporation shall not be in
default in respect of any redemption or purchase obligation pursuant to this
resolution. Any reference to "distributions" in this paragraph 3 shall not be
deemed to include any distribution made in connection with any liquidation,
dissolution or winding-up of the Corporation, whether voluntary or involuntary.
Dividends shall cease to accumulate in respect of shares of Series A Preferred
Stock on the day prior to their redemption unless the Corporation shall have
failed to pay the relevant redemption price on the date fixed for redemption.

            (c) If pursuant to subparagraph (a) hereof, a dividend is to be paid
in shares of Series A Preferred Stock, then the holders of shares of Series A
Preferred Stock shall receive and the Corporation shall issue and deliver or,
failing such actual issuance

                                       2
<PAGE>

and delivery, shall be deemed to have issued and delivered, to each holder of
record of Series A Preferred Stock that number of fully paid and non-assessable
shares of Series A Preferred Stock of the Corporation as shall be equal to the
aggregate amount payable in respect of such dividend payment not theretofore
paid on all outstanding shares of Series A Preferred Stock of each holder of
Series A Preferred Stock as if a dividend was payable in shares,. and the
Corporation shall be deemed to have issued and delivered such Series A Preferred
Stock, quarterly from and after the date of original issue, divided by the
Original Issue Price (as hereinafter defined). Fractional shares of Series A
Preferred Stock may be issued in respect of dividends hereon.

            (d) The Corporation will not, by amendment of its Certificate of
Incorporation or through any reorganization, transfer of assets, consolidation,
merger, dissolution, issue or sale of securities or any other voluntary action,
avoid or seek to avoid the observance or performance of any of the terms to be
observed or performed hereunder by the Corporation but will at all times in good
faith assist in the carrying out of all the provisions of this paragraph 3 and
in the taking of all such action as may be necessary or appropriate in order to
protect the rights of holders of Series A Preferred Stock to receive the
dividends specified herein.

      4. Preference on Liquidation, etc.

            (a) In the event of any voluntary or involuntary liquidation,
distribution of assets (other than the payment of dividends), dissolution or
winding-up of the Corporation (a "Liquidation"), before any payment or
distribution of the assets of the Corporation (whether capital or surplus) shall
be made to or set apart for the holders of shares of Common Stock, the holders
of shares of Series A Preferred Stock shall be entitled to receive the
following, as a Liquidation Preference: (i) in the case of a Liquidation, an
amount in cash equal to one thousand dollars ($1,000) per share (the "Original
Issue Price"), plus accrued and unpaid dividends to such date or (ii) in the
case of a Corporate Transaction (as defined in Section (b) below), an amount in
cash equal to the Original Issue Price without dividends, all of which shall
terminate and cease to accrue as of the date of original issue, but in either
such situation they shall be entitled to no further payment with respect to such
Series A Preferred Stock. After setting apart or paying in full the Liquidation
Preference, the remaining assets (whether stated capital or surplus), if any,
or, in the event of a Corporate Transaction, all consideration received by the
Corporation in excess of the applicable Liquidation Preference shall be
distributed exclusively to the holders of record of the issued and outstanding
Common Stock. If, upon any liquidation, distribution of assets, dissolution or
winding-up of the Corporation, the assets of the Corporation, or proceeds
thereof, distributable among the holders of shares of Series A Preferred Stock
shall be insufficient to pay the Liquidation Preference in full to the holders
of Series A Preferred Stock, then such assets or the proceeds thereof shall be
distributed among such holders ratably in accordance with the respective
liquidation amounts which would be payable on such shares if all amounts payable
thereon were paid in full. The Liquidation Preference shall be payable to the
holders of the Series A Preferred Stock upon the occurrence of a Liquidation, or
the closing of a transaction giving rise thereto, or a Corporate Transaction,
notwithstanding any delay in

                                       3
<PAGE>

the receipt of funds by the Corporation in connection therewith by virtue of any
escrow arrangement, promissory note, deferred payment of proceeds or otherwise.

            (b) (i) For purposes of this Section 4, a Corporate Transaction
shall be treated as a Liquidation and shall entitle the holders of Series A
Preferred Stock to receive, upon the consummation of such Corporate Transaction,
consideration in the same form as is to be provided in such Corporate
Transaction (whether cash, securities, other property or any combination
thereof), having a fair market value (determined in good faith by the board of
directors of the Corporation) equivalent to the amounts to which such holders of
Series A Preferred Stock would otherwise have been entitled pursuant to Section
4 (a) assuming such Corporate Transaction had constituted a Liquidation within
the meaning of said Section 4(a); provided, however, that the right to dividends
shall terminate and cease to accrue as of the date of original issue.

                  (ii) As used herein, "Corporate Transaction" means (A) any
consolidation or merger of the Corporation, other than any merger or
consolidation resulting in the holders of the capital stock of the Corporation
entitled to vote for the election of directors holding a majority of the capital
stock of the surviving or resulting entity entitled to vote for the election of
directors, (B) any person or entity (including any affiliates thereof) becoming
the holder of a majority of the capital stock of the Corporation entitled to
vote for the election of directors, (C) any sale or other disposition by the
Corporation of all or substantially all of its assets, or (D) the consummation
by the Corporation of an underwritten public offering of equity securities of
the Corporation registered under the Securities Act of 1933, as amended, the net
proceeds of which to the Corporation shall be at least $10,000,000.

            (c) Written notice of a liquidation, dissolution or winding-up
(including the transactions described in subparagraph (b) above), stating a
payment date, the estimated amount of the Liquidation Preference, and the place
where said amounts shall be payable shall be given by mail, postage prepaid, not
less than 30 days prior to the payment date stated therein, to each holder of
record of Series A Preferred Stock at his post office address as shown by the
records of the Corporation.

      5. Voting

            (a) General. Except as any provision of law, the Certificate of
Incorporation or this resolution may otherwise require, no share of Series A
Preferred Stock shall entitle the holder thereof to any voting power, to
participate in any meeting of shareholders or to have notice of any meeting of
shareholders. In all cases where the holders of shares of Series A Preferred
Stock have the right to vote separately as a class, such holders shall be
entitled to one vote for each such share held by them, respectively.

            (b) Special Class Vote. Without the consent of the holders of at
least a majority in interest of the shares of Series A Preferred Stock then
outstanding, given in writing or by vote at a meeting of such holders called for
such purpose voting together as

                                       4
<PAGE>

a class, the Corporation will not (i) increase the authorized amount of Series A
Preferred Stock, (ii) create any other class of stock (or a security convertible
into such a class of stock) entitled to a preference prior to or on parity with
the Series A Preferred Stock upon any dividend or distribution or any
liquidation, distribution of assets, dissolution or winding-up of the
Corporation or increase the authorized amount of any such other class, (iii)
amend, alter or repeal any provision of the Certificate of Incorporation so as
to adversely affect the preference, rights or powers of the Series A Preferred
Stock, (iv) merge or consolidate with or into any other person, firm or
corporation, or sell substantially all of its assets or business to another
person, or (v) purchase or otherwise acquire for value any Series A Preferred
Stock other than as provided in paragraph 6 hereof;

      6. Redemption.

            (a) Optional Redemption. (i) The Corporation, at its option, may
redeem, at any time or from time to time on or after January 1, 2003, out of
funds legally available therefor, the whole or any part of the shares of the
Series A Preferred Stock outstanding on the date fixed for redemption, at a
redemption price per share in the amount of the Original Issue Price plus all
accrued and unpaid dividends on such shares of Series A Preferred Stock to the
redemption date. Such redemption, if for less than all the outstanding shares of
the Series A Preferred Stock, shall be made pro rata in proportion to the number
of shares of Series A Preferred Stock held by each holder as of the date of the
Optional Redemption Notice (as defined below).

                  (ii) At least thirty (30) but not more than sixty (60) days
prior to the date fixed for any optional redemption of Series A Preferred Stock
(the "Optional Redemption Date"), written notice shall be mailed by mail,
postage prepaid, to each holder of record of Series A Preferred Stock to be
redeemed, at such holder's post office address last shown on the records of the
Corporation, notifying such holder of the election of the Corporation to redeem
such shares, specifying the Optional Redemption Date and calling upon such
holder to surrender to the Corporation, in the manner and at the place
designated, his certificate or certificates representing the shares to be
redeemed (such notice is hereinafter referred to as the "Optional Redemption
Notice"). On or after the Optional Redemption Date, each holder of Series A
Preferred Stock to be redeemed shall surrender his certificate or certificates
representing such shares to the Corporation, in the manner and at the place
designated in the Optional Redemption Notice, and thereupon the redemption price
of such shares shall be payable to the order of the person whose name appears on
such certificate or certificates as the owner thereof and each surrendered
certificate shall be canceled. From and after the Optional Redemption Date,
unless there shall have been a default in payment of the redemption price, all
rights of the holders of such shares to be redeemed as holders of Series A
Preferred Stock (except the right to receive the redemption price without
interest upon surrender of their certificate or certificates) shall cease with
respect to such shares, and such shares shall not thereafter be transferred on
the books of the Corporation or be deemed to be outstanding for any purpose
whatsoever.

                                       5
<PAGE>

            (b) Mandatory Redemption. (i) At any time on or after January 1,
2005, the holders of record of not less than eighty percent (80%) in interest of
shares of Series A Preferred Stock then outstanding may elect to have the
Corporation redeem, out of funds legally available therefor, all or any part of
the outstanding shares of Series A Preferred Stock, and except as provided
below, the Corporation shall, out of funds legally available therefor, redeem
and purchase any such shares upon the exercise of such option, and the holders
of record thereof shall be entitled to receive, out of funds legally available
for such purpose, payment in cash in the amount per share to be redeemed equal
to the Original Issue Price, plus accrued and unpaid dividends thereon to the
Mandatory Redemption Date (as defined below). The election by such holders to
cause the Corporation to redeem shares of Series A Preferred Stock shall be made
by delivering written notice to the Corporation at least ninety days prior to
the date such redemption is to be effected (the "Mandatory Redemption Date").

            (ii) At least thirty days prior to the Mandatory Redemption Date,
written notice shall be mailed by mail, postage prepaid, to each holder of
record of Series A Preferred Stock, at such holder's post office address last
shown on the records of the Corporation, notifying such holder of the election
of the holders of not less than eighty percent (80%) in interest of shares of
Series A Preferred Stock then outstanding to cause the Corporation to redeem
such shares, specifying the Mandatory Redemption Date and calling upon such
holder to surrender to the Corporation, in the manner and at the place
designated, his certificate or certificates representing the shares to be
redeemed (such notice is hereinafter referred to as the "Mandatory Redemption
Notice"). On or after the Mandatory Redemption Date, each holder of Series A
Preferred Stock to be redeemed shall surrender his certificate or certificates
representing such shares to the Corporation, in the manner and at the place
designated in the Mandatory Redemption Notice, and thereupon the redemption
price of such shares shall be payable to the order of the person whose name
appears on such certificate or certificates as the owner thereof and each
surrendered certificate shall be canceled. From and after the Mandatory
Redemption Date, unless there shall have been a default in payment of the
redemption price, all rights of the holders of such shares to be redeemed as
holders of Series A Preferred Stock (except the right to receive the redemption
price without interest upon surrender of their certificate or certificates)
shall cease with respect to such shares, and such shares shall not thereafter be
transferred on the books of the Corporation or be deemed to be outstanding for
any purpose whatsoever.

            (c) Partial Redemption. Upon the surrender for redemption of only a
portion of the number of shares covered by a certificate surrendered pursuant to
the foregoing provisions of this paragraph 6, the Corporation shall issue and
deliver to or upon the written order of the holder of the certificate so
surrendered, at the expense of the Corporation, a new certificate covering the
number of shares of Series A Preferred Stock representing the unredeemed portion
of the certificate so surrendered.

            (d) Retirement of Shares. Shares of Series A Preferred Stock which
have been issued and have been redeemed, repurchased or reacquired in any manner
by

                                       6
<PAGE>

the Corporation shall be retired and restored to the status of authorized but
unissued shares of Series A Preferred Stock.

      7. Business Day. If any payment or redemption shall be required by the
terms hereof to be made on a day that is not a Business Day (as defined below),
such payment or redemption shall be made on the immediately succeeding Business
Day and no further dividends shall accumulate after the day payment was
required. "Business Day" means a day other than a Saturday, Sunday, national or
New York State holiday or other day on which commercial banks in New York City
are authorized or required by law to close.

      8. Headings of Subdivisions. The headings of various subdivisions hereof
are for convenience of reference only and shall not affect the interpretation of
any of the provisions hereof.

      9. Notice to the Corporation All notices and other communications required
or permitted to be given to the Corporation hereunder shall be made by
first-class mail, postage prepaid, to the Corporation at its principal executive
offices, Attention: President).

      10. Limitations. Except as may otherwise be required by law, the shares of
Series A Preferred Stock shall not have any powers, preferences or relative,
participating, optional or other special rights other than those specifically
set forth in this resolution (as such resolution may be amended from time to
time) or otherwise in the Certificate of Incorporation of the Corporation.

      IN WITNESS WHEREOF, this Certificate has been signed on this 4th day of
January, 2000.

                                        PENICK HOLDING COMPANY

                                        By: /s/ Richard S. Kaplan
                                           -------------------------------------
                                           Name:  Richard S. Kaplan
                                           Title: Director

                                       7

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