
                             PARTICIPATION AGREEMENT

                            Dated as of June 2, 1999

                                      among


                         DOLLAR TREE DISTRIBUTION, INC.,
                  as the Construction Agent and as the Lessee,

                   FIRST SECURITY BANK, NATIONAL ASSOCIATION,
                      not individually, except as expressly
                 stated herein, but solely as the Owner Trustee
                       under the DTSD Realty Trust 1999-1,


                                       and


                           FIRST UNION NATIONAL BANK,
                          as the Lender and the Holder





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                                TABLE OF CONTENTS

                                                                            Page

SECTION 1. THE LOANS........................................................   1
SECTION 2. HOLDER ADVANCES..................................................   1
SECTION 3. SUMMARY OF TRANSACTIONS..........................................   2
    3.1 Operative Agreements................................................   2
    3.2 Property Purchase...................................................   2
    3.3 Construction of Improvements; Commencement of Basic Rent............   2
SECTION 4. THE CLOSINGS.....................................................   3
    4.1 Initial Closing Date................................................   3
    4.2 Initial Closing Date; Property Closing Dates; Acquisition Advances;
        Construction Advances...............................................   3
SECTION 5. FUNDING OF ADVANCES; CONDITIONS PRECEDENT;
           REPORTING REQUIREMENTS ON COMPLETION DATE; THE
           LESSEE'S DELIVERY OF NOTICES; RESTRICTIONS ON LIENS..............   3
    5.1 General.............................................................   3
    5.2 Procedures for Funding..............................................   4
    5.3 Conditions Precedent for the Lessor and the Bank Relating to the
        Initial Closing Date and the Advance of Funds for the Acquisition
        of a Property.......................................................   5
    5.4 Conditions Precedent for the Lessor and the Bank Relating to the
        Advance of funds after the Acquisition Advance......................   9
    5.5 Additional Reporting and Delivery Requirements on Completion Date
        and on Construction Period Termination Date.........................  10
    5.6 The Construction Agent Delivery of Construction Budget
        Modifications.......................................................  11
    5.7 Restrictions on Liens...............................................  11
    5.8 Payments............................................................  11
    5.9 Joinder Agreement Requirements......................................  11
    5.10 Maintenance of the Lessee as a Wholly-Owned Entity.................  12
    5.11 Unilateral Right to Increase the Holder Commitments and the Lender
         Commitments........................................................  12
SECTION 6. REPRESENTATIONS AND WARRANTIES...................................  12
    6.1 Representations and Warranties of the Borrower......................  12
    6.2 Representations and Warranties of Each Credit Party.................  13
SECTION 6B. GUARANTY........................................................  16
    6B.1 Guaranty of Payment and Performance................................  16
    6B.2 Obligations Unconditional..........................................  16
    6B3. Modifications......................................................  17
    6B.4 Waiver of Rights...................................................  18
    6B.5 Reinstatement......................................................  18
    6B.6 Remedies...........................................................  19
    6B.7 Limitation of Guaranty.............................................  19
SECTION 7. PAYMENT OF CERTAIN EXPENSES......................................  19
    7.1 Transaction Expenses................................................  19

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    7.2 Brokers' Fees.......................................................  20
    7.3 Certain Fees and Expenses...........................................  20
SECTION 8. OTHER COVENANTS AND AGREEMENTS...................................  21
    8.1 Cooperation with the Construction Agent or the Lessee...............  21
    8.2 Covenants of the Owner Trustee and the Bank.........................  21
    8.3 Credit party Covenants, Consent and Acknowledgment..................  22
    8.4 Allocation of Certain Payments......................................  24
    8.5 Grant of Easements, etc.............................................  25
    8.6 Appointment by the Bank and the Owner Trustee.......................  25
    8.7 Collection and Allocation of Payments and Other Amounts.............  25
    8.8 Release of Properties, etc..........................................  26
SECTION 9. CREDIT AGREEMENT AND TRUST AGREEMENT.............................  27
    9.1 The Construction Agent's and the Lessee's Credit Agreement Rights...  27
    9.2 The Construction Agent's and the Lessee's Trust Agreement Rights....  27
SECTION 10. TRANSFER OF INTEREST............................................  28
    10.1 Restrictions on Transfer...........................................  28
    10.2 Effect of Transfer.................................................  28
SECTION 11. INDEMNIFICATION.................................................  28
    11.1 General indemnity..................................................  28
    11.2 General Tax Indemnity..............................................  29
    11.3 Increased Costs, Illegality, etc...................................  32
    11.4 Funding/Contribution Indemnity.....................................  34
    11.5 Additional Provisions Regarding Indemnification....................  34
SECTION 12. MISCELLANEOUS...................................................  35
    12.1 Survival of Agreements.............................................  35
    12.2 Notices............................................................  35
    12.3 Counterparts.......................................................  37
    12.4 Terminations, Amendments, Waivers, Etc.; Unanimous Vote Matters....  37
    12.5 Headings, etc......................................................  37
    12.6 Parties in Interest................................................  37
    12.7 GOVERNING LAW; SUBMISSION TO JURISDICTION; WAIVER OF JURY TRIAL;
         VENUE; ARBITRATION.................................................  37
    12.8 Severability.......................................................  39
    12.9 Liability Limited..................................................  39
    12.10 Rights of the Credit Parties......................................  40
    12.11 Further Assurnaces................................................  41
    12.12 Calculations under Operative Agreements...........................  41
    12.13 [Intentionally Left Blank]........................................  41
    12.14 Financial Reporting/Tax Characterization..........................  41

                                       ii

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EXHIBITS

A - Form of Requisition - Sections 4.2, 5.2, 5.3 and 5.4

B - Form of Outside Counsel Opinion for the Lessee - Section 5.3(j)

C - Form of Officer's Certificate - Section 5.3(w)

D - Form of Secretary's Certificate - Section 5.3(x)

E - Form of Officer's Certificate - Section 5.3(z)

F - Form of Secretary's Certificate - Section 5.3(aa)

G - Form of Outside Counsel Opinion for the Owner Trustee - Section 5.3(bb)

H - Form of Outside Counsel Opinion for the Lessee - Section 5.3(cc)

I - Form of Officer's Certificate - Section 5.5

J - Form of Joinder Agreement - Section 5.9(a)

K - Description of Material Litigation - Section 6.2(d)

L - State of  Incorporation/Formation  and  Principal  Place of Business of Each
    Guarantor - Section 6.2(i)

M - Form of Officer's Compliance Certificate - Section 8.3(k)

Appendix A - Rules of Usage and Definitions


                                      iii


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                             PARTICIPATION AGREEMENT


         THIS  PARTICIPATION  AGREEMENT  dated as of June 2,  1999 (as  amended,
modified,  extended,  supplemented,  restated and/or replaced from time to time,
this  "Agreement") is by and among DOLLAR TREE  DISTRIBUTION,  INC., a Virginia,
corporation  (the "Lessee" or the  "Construction  Agent");  the various  parties
hereto from time to time as guarantors (subject to the definitions of Guarantors
in  Appendix  A  hereto,  individually  a  "Guarantor"  and  collectively,   the
"Guarantors");  FIRST SECURITY BANK,  NATIONAL  ASSOCIATION,  a national banking
association, not individually (in its individual capacity, the "Trust Company"),
except as expressly  stated  herein,  but solely as the Owner  Trustee under the
DTSD Realty Trust 1999-1 (the "Owner Trustee",  the "Borrower" or the "Lessor");
and FIRST UNION NATIONAL  BANK, a national  banking  association,  as lender and
holder  (together with its successors and assigns,  "Bank").  Capitalized  terms
used but not  otherwise  defined in this  Agreement  shall have the meanings set
forth in Appendix A hereto.

         In  consideration of the mutual  agreements  herein contained and other
good and valuable  consideration,  the receipt of which is hereby  acknowledged,
the parties hereto hereby agree as follows:

                              SECTION 1. THE LOANS.

         Subject to the terms and  conditions  of this  Agreement  and the other
Operative  Agreements and in reliance on the  representations  and warranties of
each of the parties hereto contained  herein or made pursuant  hereto,  the Bank
has  agreed  to make  Loans  to the  Lessor  from  time to time in an  aggregate
principal  amount of up to the aggregate  amount of the Commitments in order for
the Lessor to acquire the  Properties and certain  Improvements,  to develop and
construct  certain  Improvements in accordance with the Agency Agreement and the
terms and provisions hereof and for the other purposes  described herein, and in
consideration of the receipt of proceeds of the Loans, the Lessor will issue the
Notes.  The Loans  shall be made and the Notes  shall be issued  pursuant to the
Credit  Agreement.  Pursuant to Section 5 of this Agreement and Section 2 of the
Credit Agreement,  the Loans will be made to the Lessor from time to time at the
request of the Construction  Agent in consideration  for the Construction  Agent
agreeing  for the benefit of the Lessor,  pursuant to the Agency  Agreement,  to
acquire  the  Properties,   to  acquire  the  Equipment,  to  construct  certain
Improvements and to cause the Lessee to lease the Properties, each in accordance
with the Agency Agreement and the other Operative Agreements.  The Loans and the
obligations  of the Lessor  under the Credit  Agreement  shall be secured by the
Collateral.

                           SECTION 2. HOLDER ADVANCES.

         Subject to the terms and  conditions  of this  Agreement  and the other
Operative  Agreements and in reliance on the  representations  and warranties of
each of the parties hereto  contained  herein or made pursuant  hereto,  on each
date Advances are requested to be made in accordance with Section 5 hereof,  the
Bank shall make a Holder  Advance to the Lessor with  respect to the DTSD Realty
Trust 1999-1 in an amount in immediately available funds such that

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the aggregate of all Holder Advances on such date shall be three percent (3%) of
the amount of the Requested  Funds on such date;  provided,  that the Bank shall
not be  obligated  for any  Holder  Advance  in excess of the  Available  Holder
Commitment. No prepayment or any other payment with respect to any Advance shall
be permitted  such that the Holder  Advance with respect to such Advance is less
than three percent (3%) of the  outstanding  amount of such  Advance,  except in
connection with  termination or expiration of the Term or in connection with the
exercise of remedies relating to the occurrence of a Lease Event of Default.

                       SECTION 3. SUMMARY OF TRANSACTIONS.

         3.1     Operative Agreements.

         On the date hereof,  each of the respective  parties hereto and thereto
shall execute and deliver this  Agreement,  the Lease,  each  applicable  Ground
Lease,  the  Agency  Agreement,  the  Credit  Agreement,  the  Notes,  the Trust
Agreement,  the Certificates,  the Security Agreement,  each applicable Mortgage
Instrument and such other documents,  instruments,  certificates and opinions of
counsel as agreed to by the parties hereto.

         3.2     Property Purchase.

         On each Property  Closing Date and subject to the terms and  conditions
of this  Agreement (a) the Bank will make a Holder  Advance in  accordance  with
Sections 2 and 5 of this  Agreement  and the terms and  provisions  of the Trust
Agreement,  (b) the Bank will make Loans in accordance  with Sections 1 and 5 of
this  Agreement and the terms and  provisions of the Credit  Agreement,  (c) the
Lessor will  purchase and acquire good and  marketable  title to or ground lease
pursuant  to a Ground  Lease,  the  applicable  Property,  each to be  within an
Approved State, identified by the Construction Agent, in each case pursuant to a
Deed,  Bill of Sale or Ground  Lease,  as the case may be,  and grant the Bank a
lien on such  Property by execution of the required  Security  Documents and (d)
the Bank, the Lessee and the Lessor shall execute and deliver a Lease Supplement
relating to such Property.

         3.3     Construction of Improvements; Commencement of Basic Rent.

         Construction   Advances   will  be  made  with  respect  to  particular
Improvements  to be  constructed  and with respect to ongoing Work regarding the
Equipment and construction of particular Improvements, in each case, pursuant to
the terms  and  conditions  of this  Agreement  and the  Agency  Agreement.  The
Construction  Agent  will act as a  construction  agent on behalf of the  Lessor
respecting  the  Work  regarding  the  Equipment,   the   construction  of  such
Improvements and the  expenditures of the  Construction  Advances related to the
foregoing.  The  Construction  Agent  shall  promptly  notify  the  Lessor  upon
Completion of the  Improvements  and the Lessee shall commence to pay Basic Rent
as of the Rent Commencement Date.

                                       2
<PAGE>


                            SECTION 4. THE CLOSINGS.

         4.1     Initial Closing Date.

         All documents and  instruments  required to be delivered on the Initial
Closing  Date shall be  delivered  at the  offices  of Moore & Van Allen,  PLLC,
Charlotte, North Carolina, or at such other location as may be determined by the
Lessor, the Bank and the Lessee.

         4.2     Initial Closing Date; Property Closing Dates; Acquisition
                 Advances; Construction Advances.

         The  Construction  Agent  shall  deliver  to  the  Bank  a  requisition
(together with invoices for, or other reasonably  satisfactory  evidence of, any
Transaction  Expenses and other fees, expenses and disbursements  referred to in
Section 7.1 that are to be paid with the applicable  Advance,  a "Requisition"),
in  the  form  attached  hereto  as  Exhibit  A or  in  such  other  form  as is
satisfactory to the Bank, in its reasonable  discretion,  in connection with (a)
the Transaction  Expenses and other fees,  expenses and  disbursements  payable,
pursuant to Section 7.1, by the Lessor and (b) each Acquisition Advance pursuant
to Section  5.3 and (c) each  Construction  Advance  pursuant  to  Section  5.4.
Notwithstanding  the  preceding  sentence,  the  parties  hereto  agree  that no
Requisition  shall be required for the Lenders and the Holders to make  Advances
pursuant to or in connection with Sections 7.1 and 11.5.



              SECTION 5. FUNDING OF ADVANCES; CONDITIONS PRECEDENT;
                   REPORTING REQUIREMENTS ON COMPLETION DATE;
            THE LESSEE'S DELIVERY OF NOTICES; RESTRICTIONS ON LIENS.

         5.1      General.

                  (a) To the extent funds have been  advanced by the Bank to the
         Lessor as Loans and as Holder Advances,  the Lessor will use such funds
         from time to time in accordance  with the terms and  conditions of this
         Agreement and the other  Operative  Agreements  (i) at the direction of
         the Construction Agent to acquire the Properties in accordance with the
         terms of this Agreement,  the Agency  Agreement and the other Operative
         Agreements,  (ii) to make Advances to the Construction  Agent to permit
         the  acquisition,  testing,  engineering,  installation,   development,
         construction,  modification,  design, and renovation, as applicable, of
         the Properties (or components  thereof) in accordance with the terms of
         the Agency Agreement and the other Operative  Agreements,  and (iii) to
         pay  Transaction  Expenses,  fees,  expenses  and  other  disbursements
         payable by the Lessor under Section 7.1.

                  (b) In lieu of the payment of interest on the Loans and Holder
         Yield on the Holder  Advances on any  Scheduled  Interest  Payment Date
         with  respect  to any  Property  during  the  period  prior to the Rent
         Commencement  Date with respect to such  Property,  (i) each Loan shall
         automatically be increased by the amount of interest accrued and unpaid
         on such Loan for such  period  (except to the  extent  that at any time
         such   increase

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         would cause such Loan to exceed  the  Available  Commitment),  and (ii)
         each Holder Advance shall automatically be increased  by the  amount of
         Holder Yield accrued and unpaid on such Holder  Advance for such period
         (except to the extent that at any time  such  increase  would cause the
         Holder  Advance  to  exceed  the  Available  Holder  Commitment).  Such
         increases  in  a  Loan  and  a  Holder  Advance shall occur without any
         disbursement of funds by any Person.

         5.2      Procedures for Funding.

                  (a) The  Construction  Agent  shall  designate  the  date  for
         Advances  hereunder in accordance with the terms and provisions hereof;
         provided,  however,  it is understood  and agreed that no more than two
         (2) Advances (excluding any conversion and/or continuation of any Loans
         or Holder  Advances) may be requested  during any calendar  month.  Not
         less than (i) three (3) Business Days prior to the Initial Closing Date
         and (ii)  three  (3)  Business  Days  prior  to the  date on which  any
         Acquisition  Advance  or  Construction  Advance  is  to  be  made,  the
         Construction  Agent shall deliver to the Bank,  (A) with respect to the
         Initial  Closing Date and each  Acquisition  Advance,  a Requisition as
         described in Section 4.2 hereof (including  without  limitation a legal
         description  of the Land,  if any, a schedule of the  Improvements,  if
         any,  and a  schedule  of the  Equipment,  if  any,  acquired  or to be
         acquired  on such  date,  and a  schedule  of the Work,  if any,  to be
         performed, each of the foregoing in a form reasonably acceptable to the
         Bank) and (B) with respect to each Construction  Advance, a Requisition
         identifying   (among   other   things)  the   Property  to  which  such
         Construction Advance relates.

                  (b) Each Requisition  shall: (i) be irrevocable,  (ii) request
         funds in an amount that is not in excess of the total  aggregate of the
         Available  Commitments  plus the Available  Holder  Commitments at such
         time, and (iii) request that the Bank make Holder Advances and Loans to
         the  Lessor  for  the  payment  of   Transaction   Expenses,   Property
         Acquisition  Costs  (in the case of an  Acquisition  Advance)  or other
         Property  Costs  (in the  case of a  Construction  Advance)  that  have
         previously  been  incurred  or are to be  incurred  on the date of such
         Advance to the extent such were not subject to a prior Requisition,  in
         each case as specified in the Requisition.

                  (c) Subject to the  satisfaction  of the conditions  precedent
         set forth in  Sections  5.3 or 5.4,  as  applicable,  on each  Property
         Closing  Date or the date on which the  Construction  Advance  is to be
         made, as applicable,  (i) the Bank shall make Loans to the Lessor in an
         aggregate  amount equal to ninety-seven  percent (97%) of the Requested
         Funds specified in any Requisition, up to an aggregate principal amount
         equal to the  aggregate  of the  Available  Commitments,  (ii) the Bank
         shall make a Holder Advance based on its Holder Commitment in an amount
         such that the  aggregate  of all Holder  Advances at such time shall be
         three percent (3%) of the balance of the Requested  Funds  specified in
         such  Requisition,  up to the  aggregate  advanced  amount equal to the
         Available Holder Commitments;  and (iii) the total amount of such Loans
         and Holder  Advances  made on such date shall (x) be used by the Lessor
         to pay Property Costs including  Transaction  Expenses within three (3)
         Business  Days of the  receipt by the Lessor of such

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         Advance or (y) be advanced by the Lessor on the date of such Advance to
         the  Construction  Agent  or  the  Lessee  to  pay  Property  Costs, as
         applicable. Notwithstanding  that  the  Operative Agreements state that
         Advances shall be directed to the Lessor, each Advance shall in fact be
         directed to the Construction  Agent (for the benefit of the Lessor) and
         applied  by  the  Construction  Agent (for  the  benefit of the Lessor)
         pursuant to the requirements imposed on  the Lessor under the Operative
         Agreements.

                  (d) With  respect to an Advance  obtained by the Lessor to pay
         for Property Costs and/or  Transaction  Expenses or other costs payable
         under  Section  7.1  hereof  and not  expended  by the  Lessor for such
         purpose on the date of such Advance,  such amounts shall be held by the
         Lessor  (or the Bank on behalf  of the  Lessor)  until  the  applicable
         closing  date or, if such  closing date does not occur within three (3)
         Business  Days of the date of the  Lessor's  receipt  of such  Advance,
         shall be applied  regarding the  applicable  Advance to repay the Loans
         and the Holder  Advances and,  subject to the terms hereof,  and of the
         Credit  Agreement and the Trust  Agreement,  shall remain available for
         future  Advances.  Any such  amounts held by the Lessor (or the Bank on
         behalf of the  Lessor)  shall be  subject  to the lien of the  Security
         Agreement.

                  (e) All Operative  Agreements which are to be delivered to the
         Lessor  shall be delivered  to the Bank,  on behalf of the Lessor,  and
         such items (except for Notes,  Certificates,  Bills of Sale, the Ground
         Leases and chattel paper originals,  with respect to which in each case
         there shall be only one  original)  shall be delivered  with  originals
         sufficient for the Lessor and the Bank. All other items which are to be
         delivered to the Lessor  shall be  delivered to the Bank,  on behalf of
         the  Lessor,  and such other  items  shall be held by the Bank.  To the
         extent any such other items are  requested in writing from time to time
         by the Lessor, the Bank shall provide a copy of such item.

                  (f)  Notwithstanding  the completion of any closing under this
         Agreement pursuant to Sections 5.3 or 5.4, each condition  precedent in
         connection  with any such closing may be  subsequently  enforced by the
         Bank (unless such has been expressly waived in writing by the Bank).

         5.3      Conditions  Precedent  for the Lessor and the Bank Relating to
                  the  Initial  Closing  Date and the  Advance  of Funds for the
                  Acquisition of a Property.

         The  obligations  (i) on the Initial Closing Date of the Lessor and the
Bank to enter into the  transactions  contemplated by this Agreement,  including
without  limitation  the  obligation  to  execute  and  deliver  the  applicable
Operative  Agreements to which each is a party on the Initial Closing Date, (ii)
on the Initial  Closing  Date of the Bank to make Holder  Advances  and Loans in
order to pay  Transaction  Expenses,  fees,  expenses  and  other  disbursements
payable  by the  Lessor  under  Section  7.1 of this  Agreement  and  (iii) on a
Property Closing Date for the purpose of providing funds to the Lessor necessary
to pay the Transaction Expenses,  fees, expenses and other disbursements payable
by the Lessor under Section 7.1 of this Agreement and to acquire or ground lease
a  Property  (an  "Acquisition  Advance"),  in each  case  (with  regard  to the
foregoing  Sections  5.3(i),  (ii) and (iii)) are subject to the satisfaction or
waiver of the following  conditions

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<PAGE>


precedent  on or prior to the Initial  Closing Date or the  applicable  Property
Closing  Date,  as the  case may be (to the  extent  such  conditions  precedent
require the  delivery of any  agreement,  certificate,  instrument,  memorandum,
legal or other opinion, appraisal,  commitment, title insurance commitment, lien
report  or any other  document  of any kind or type,  such  shall be in form and
substance   satisfactory   to   the   Bank,   in  its   reasonable   discretion;
notwithstanding  the  foregoing,  the  obligations  of each  party  shall not be
subject to any conditions contained in this Section 5.3 which are required to be
performed by such party):

                  (a) the correctness of the  representations  and warranties of
         the parties to this Agreement  contained  herein,  in each of the other
         Operative  Agreements and each  certificate  delivered  pursuant to any
         Operative  Agreement  (including  without  limitation the  Incorporated
         Representations and Warranties) on each such date;

                  (b) the  performance by the parties to this Agreement of their
         respective  agreements  contained  herein  and in the  other  Operative
         Agreements to be performed by them on or prior to each such date;

                  (c) The Bank shall have received a fully executed  counterpart
         copy of the Requisition, appropriately completed;

                  (d) [Reserved];

                  (e) the Construction  Agent shall have delivered to the Bank a
         good standing certificate for the Construction Agent in the state where
         each such  Property is located,  the Deed with  respect to the Land and
         existing  Improvements  (if any),  a copy of the Ground Lease (if any),
         and a copy of the Bill of Sale with respect to the  Equipment (if any),
         respecting such of the foregoing as are being acquired or ground leased
         on each such date with the proceeds of the Loans and Holder Advances or
         which have been previously  acquired or ground leased with the proceeds
         of the Loans and Holder Advances;

                  (f)  there  shall  not have  occurred  and be  continuing  any
         Default or Event of Default under any of the Operative  Agreements  and
         no Default or Event of Default  under any of the  Operative  Agreements
         will have occurred after giving effect to the Advance requested by each
         such Requisition;

                  (g) the  Construction  Agent shall have  delivered to the Bank
         title  insurance  commitments  to issue policies  respecting  each such
         Property,  with such endorsements as the Bank deems necessary, in favor
         of the Lessor and the Bank from a title insurance company acceptable to
         the Bank, but only with such title exceptions thereto as are acceptable
         to the Bank;

                  (h) the Construction Agent shall have delivered to the Bank an
         environmental site assessment respecting each such Property prepared by
         an  independent  recognized  professional  acceptable  to the  Bank and
         evidencing  no  pre-existing  environmental  condition  with respect to
         which there is more than a remote risk of loss;

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<PAGE>


                  (i) the Construction  Agent shall have delivered to the Bank a
         survey  (with  a  flood  hazard  certification)  respecting  each  such
         Property  prepared  by  (i)  an  independent  recognized   professional
         acceptable  to the  Bank  and  (ii)  in a  manner  and  including  such
         information as is required by the Bank;

                  (j) unless such an opinion has previously  been delivered with
         respect to a particular state, the Construction Agent shall have caused
         to be delivered to the Bank a legal opinion in the form attached hereto
         as Exhibit B or in such other form as is  reasonably  acceptable to the
         Bank, prepared by counsel acceptable to the Bank;

                  (k) the  Construction  Agent shall have caused to be delivered
         to the Bank a Mortgage Instrument (in such form as is acceptable to the
         Bank),  Lessor  Financing  Statements and Lender  Financing  Statements
         respecting  each such  Property,  all fully  executed and in recordable
         form;

                  (l) the Lessee  shall have  delivered to the Bank with respect
         to each such  Property a Lease  Supplement  and a memorandum  (or short
         form lease)  regarding the Lease and such Lease  Supplement in the form
         attached  to the  Lease  as  Exhibit  B or in  such  other  form  as is
         acceptable to the Bank and suitable for recording;

                  (m) with respect to each Acquisition  Advance,  the sum of the
         Available  Commitment  plus  the  Available  Holder  Commitment  (after
         deducting the Unfunded  Amount,  if any, and after giving effect to the
         Acquisition  Advance)  will be  sufficient  to pay all amounts  payable
         therefrom;

                  (n) if any such  Property  is subject to a Ground  Lease,  the
         Construction  Agent shall have caused a lease memorandum (or short form
         lease)  to be  delivered  to the Bank for such  Ground  Lease  and,  if
         requested  by the Bank,  a landlord  waiver and a mortgagee  waiver (in
         each case, in such form as is acceptable to the Bank);

                  (o) counsel  (acceptable to the Bank) for the ground lessor of
         each such  Property  subject to a Ground Lease shall have issued to the
         Lessor and the Bank its opinion;

                  (p) the Construction  Agent shall have delivered to the Bank a
         preliminary Construction Budget for each such Property, if applicable;

                  (q) the Construction Agent shall have provided evidence to the
         Bank of insurance with respect to each such Property as provided in the
         Lease;

                  (r) the  Construction  Agent  shall have  caused an  Appraisal
         regarding  each  such  Property  to be  provided  to the  Bank  from an
         appraiser satisfactory to the Bank;

                                       7

<PAGE>


                  (s) the Construction  Agent shall cause (i) Uniform Commercial
         Code lien  searches,  tax lien  searches  and  judgment  lien  searches
         regarding the Lessee and each Credit Party to be conducted  (and copies
         thereof  to  be  delivered  to  the  Bank)  in  such  jurisdictions  as
         determined  by the  Bank  by a  nationally  recognized  search  company
         acceptable  to the  Bank and (ii) the  liens  referenced  in such  lien
         searches  which are  objectionable  to the Bank to be either removed or
         otherwise handled in a manner satisfactory to the Bank;

                  (t) all taxes,  fees and other charges in connection  with the
         execution,   delivery,   recording,  filing  and  registration  of  the
         Operative  Agreements  and/or documents related thereto shall have been
         paid or  provisions  for  such  payment  shall  have  been  made to the
         satisfaction of the Bank;

                  (u) each of the  Operative  Agreements  to be entered  into on
         such date shall have been duly  authorized,  executed and  delivered by
         the parties  thereto,  and shall be in full force and  effect,  and the
         Bank shall have received a fully executed copy of each of the Operative
         Agreements;

                  (v)  since  the  date of the  most  recent  audited  financial
         statements  (as delivered  pursuant to the  requirements  of the Lessee
         Credit  Agreement)  of the Lessee,  there shall not have  occurred  any
         event, condition or state of facts which shall have or could reasonably
         be  expected  to  have  a  Material  Adverse  Effect,   other  than  as
         specifically contemplated by the Operative Agreements;

                  (w) as of the Initial  Closing Date only,  the Bank shall have
         received an  Officer's  Certificate,  dated as of the  Initial  Closing
         Date, of the Lessee in the form attached hereto as Exhibit C or in such
         other form as is acceptable to the Bank;

                  (x) as of the Initial  Closing Date only,  the Bank shall have
         received (i) a certificate  of the Secretary or an Assistant  Secretary
         of each Credit Party, dated as of the Initial Closing Date, in the form
         attached  hereto as Exhibit D or in such other form as is acceptable to
         the Bank and (ii) a good  standing  certificate  (or local  equivalent)
         from the respective  states where such Credit Party is incorporated and
         where the principal place of business of such Credit Party is located;

                  (y) as of the Initial Closing Date only,  there shall not have
         occurred  any  material  adverse  change  in the  consolidated  assets,
         liabilities, operations, business or condition (financial or otherwise)
         of the Credit Parties (on a consolidated  basis) from that set forth in
         the most recent audited consolidated financial statements of the Credit
         Parties which have been provided to the Bank;

                  (z) as of the Initial  Closing Date only,  the Bank shall have
         received an Officer's Certificate of the Lessor dated as of the Initial
         Closing Date in the form attached  hereto as Exhibit E or in such other
         form as is acceptable to the Bank;

                                       8

<PAGE>


                  (aa) as of the Initial  Closing Date only, the Bank shall have
         received (i) a certificate  of the Secretary,  an Assistant  Secretary,
         Trust  Officer  or Vice  President  of the  Trust  Company  in the form
         attached  hereto as Exhibit F or in such other form as is acceptable to
         the Bank and (ii) a good  standing  certificate  from the Office of the
         Comptroller of the Currency;

                  (bb) as of the  Initial  Closing  Date only,  counsel  for the
         Lessor  acceptable  to the Bank shall have issued to the Lessee and the
         Bank its  opinion in the form  attached  hereto as Exhibit G or in such
         other form as is reasonably acceptable to the Bank; and

                  (cc) as of the Initial  Closing  Date only,  the  Construction
         Agent shall have caused to be delivered to the Bank a legal  opinion in
         the form  attached  hereto  as  Exhibit H or in such  other  form as is
         acceptable to the Bank from counsel acceptable to the Bank;

         5.4      Conditions Precedent for  the Lessor and  the Bank Relating to
                  the Advance of Funds after the Acquisition Advance.

         The  obligations  of the  Bank to make  Holder  Advances  and  Loans in
connection  with all requests for Advances  subsequent to the  acquisition  of a
Property  (and  to pay  the  Transaction  Expenses,  fees,  expenses  and  other
disbursements  payable by the Lessor  under  Section  7.1 of this  Agreement  in
connection therewith) are subject to the satisfaction or waiver of the following
conditions  precedent  (to the extent  such  conditions  precedent  require  the
delivery of any agreement, certificate,  instrument,  memorandum, legal or other
opinion, appraisal,  commitment,  title insurance commitment, lien report or any
other  document  of any  kind or  type,  such  shall  be in form  and  substance
satisfactory  to the Bank, in its  reasonable  discretion;  notwithstanding  the
foregoing,  the obligations of each party shall not be subject to any conditions
contained in this Section 5.4 which are required to be performed by such party):

                  (a) the  correctness on such date of the  representations  and
         warranties of the parties to this Agreement  contained  herein, in each
         of the other  Operative  Agreements and in each  certificate  delivered
         pursuant to any Operative  Agreement  (including without limitation the
         Incorporated Representations and Warranties);

                  (b) the  performance by the parties to this Agreement of their
         respective  agreements  contained  herein  and in the  other  Operative
         Agreements to be performed by them on or prior to each such date;

                  (c) the Bank shall have received a fully executed  counterpart
         of the Requisition, appropriately completed;

                  (d) based upon the applicable  Construction Budget which shall
         satisfy the requirements of this Agreement,  the Available  Commitments
         and the  Available  Holder  Commitment  (after  deducting  the Unfunded
         Amount) will be sufficient to complete the Improvements;

                                       9

<PAGE>


                  (e)  there  shall  not have  occurred  and be  continuing  any
         Default or Event of Default under any of the Operative  Agreements  and
         no Default or Event of Default  under any of the  Operative  Agreements
         will have  occurred  after giving  effect to the  Construction  Advance
         requested by the applicable Requisition;

                  (f) the title  insurance  policy  delivered in connection with
         the  requirements  of Section  5.3(g)  shall  provide  for (or shall be
         endorsed to provide  for)  insurance in an amount at least equal to the
         maximum  total  Property  Cost  indicated  by the  Construction  Budget
         referred  to in  subparagraph  (d) above  and  there  shall be no title
         change or exception objectionable to the Bank; and

                  (g) the  Construction  Agent shall have  delivered to the Bank
         copies of the Plans and Specifications for the applicable Improvements;

                  (h) all taxes,  fees and other charges in connection  with the
         execution,   delivery,   recording,  filing  and  registration  of  the
         Operative  Agreements  shall  have  been  paid or  provisions  for such
         payment shall have been made to the satisfaction of the Bank;

                  (i)      [reserved];

                  (j)  in  the  opinion  of  the  Bank  and  its  counsel,   the
         transactions  contemplated by the Operative  Agreements do not and will
         not  subject  the  Lessor  or  the  Bank  to  any  adverse   regulatory
         prohibitions, constraints, penalties or fines.

         5.5      Additional Reporting and  Delivery  Requirements on Completion
                  Date and on Construction Period Termination Date.

         On or prior to the Completion Date for each Property,  the Construction
Agent shall  deliver to the Bank an Officer's  Certificate  in the form attached
hereto  as  Exhibit  I or in such  other  form  as is  acceptable  to the  Bank.
Furthermore,  on or  prior  to  the  Completion  Date  for  each  Property,  the
Construction  Agent shall  deliver or cause to be  delivered to the Bank (unless
previously  delivered  to the Bank)  originals of the  following,  each of which
shall  be in form  and  substance  acceptable  to the  Bank,  in its  reasonable
discretion:  (v) a title  insurance  endorsement  regarding the title  insurance
policy delivered in connection with the requirements of Section 5.3(g), but only
to the extent such  endorsement  is  necessary  to provide for  insurance  in an
amount at least equal to the maximum total  Property Cost and, if endorsed,  the
endorsement  shall not include a title change or exception  objectionable to the
Bank;  (w) an as-built  survey for such  Property,  (x)  insurance  certificates
respecting  such Property as required  hereunder and under the Lease  Agreement,
and (y) if requested by the Bank,  amendments to the Lessor Financing Statements
executed by the  appropriate  parties.  In addition,  on the Completion Date for
such  Property the  Construction  Agent  covenants and agrees that the recording
fees,  documentary  stamp  taxes  or  similar  amounts  required  to be  paid in
connection  with the  related  Mortgage  Instrument  shall  have been paid in an
amount required by applicable law, subject,  however,  to the obligations of the
Bank to fund such costs to the extent required pursuant to Section 7.1.

                                       10

<PAGE>


         5.6      The  Construction   Agent  Delivery  of   Construction  Budget
                  Modifications.

         The Construction Agent covenants and agrees to deliver to the Bank each
month notification of any modification to any Construction  Budget regarding any
Property if such  modification  increases the cost to construct  such  Property;
provided no Construction  Budget may be increased unless (a) the title insurance
policies  referenced  in  Section  5.3(g)  are also  modified  or  endorsed,  if
necessary, to provide for insurance in an amount that satisfies the requirements
of Section  5.4(f) of this  Agreement  and (b) after  giving  effect to any such
amendment,  the Construction  Budget remains in compliance with the requirements
of Section 5.4(d) of this Agreement.

         5.7      Restrictions on Liens.

         On each Property Closing Date, the Construction  Agent shall cause each
Property  acquired  by the Lessor on such date to be free and clear of all Liens
except those referenced in Sections  6.2(c)(ii) and 6.2(c)(iii).  On each date a
Property  is either sold to a third  party in  accordance  with the terms of the
Operative  Agreements or,  pursuant to Section  22.1(a) of the Lease  Agreement,
retained by the  Lessor,  the Lessee  shall  cause such  Property to be free and
clear of all Liens  (other  than  Lessor  Liens and such  other  Liens  that are
expressly  set forth as title  exceptions on the title  commitment  issued under
Section  5.3(g)  with  respect  to  such  Property,  to the  extent  such  title
commitment has been approved by the Bank).

         5.8      Payments.

         All payments of principal,  interest, Holder Advances, Holder Yield and
other  amounts to be made by the  Construction  Agent or the  Lessee  under this
Agreement or any other Operative  Agreements  (excluding Excepted Payments which
shall be paid  directly  to the party to whom such  payments  are owed) shall be
made to the  Bank at the  office  designated  by the Bank  from  time to time in
Dollars and in  immediately  available  funds,  without  setoff,  deduction,  or
counterclaim.  Subject to the  definition  of  "Interest  Period" in  Appendix A
attached  hereto,  whenever  any  payment  under  this  Agreement  or any  other
Operative  Agreements  shall be stated to be due on a day that is not a Business
Day,  such  payment may be made on the next  succeeding  Business  Day, and such
extension of time in such case shall be included in the computation of interest,
Holder  Yield  and  fees  payable  pursuant  to  the  Operative  Agreements,  as
applicable and as the case may be.

         5.9      Joinder Agreement Requirements.

         Each Domestic  Subsidiary formed or acquired  subsequent to the Initial
Closing Date shall become a Guarantor and shall satisfy the following conditions
within  thirty (30) days after the  formation or  acquisition  of such  Domestic
Subsidiary:

                  (a) such Domestic Subsidiary shall execute and deliver to Bank
         a Joinder Agreement in the form attached hereto as EXHIBIT J;

                                       11

<PAGE>


                  (b) such Domestic  Subsidiary shall have delivered to Bank (x)
         an  Officer's  Certificate  of such  Domestic  Subsidiary  in the  form
         attached  hereto as EXHIBIT C, (y) a certificate of the Secretary or an
         Assistant  Secretary of such  Domestic  Subsidiary in the form attached
         hereto  as  EXHIBIT  D and (z) good  standing  certificates  (or  local
         equivalent) from the respective  states where such Domestic  Subsidiary
         is incorporated or otherwise organized and where the principal place of
         business of such Domestic Subsidiary is located as to its good standing
         in each such state;

                  (c) such Domestic  Subsidiary  shall have delivered to Bank an
         opinion of counsel  (acceptable to Bank) in the form attached hereto as
         EXHIBIT H; and

                  (d)  Bank  shall   have   received   such   other   documents,
         certificates and information as Bank shall have reasonably requested.

         5.10     Maintenance of the Lessee as a Wholly-Owned Entity.

         From the Initial  Closing  Date and  thereafter  until such time as all
obligations  of all Credit  Parties  under the  Operative  Agreements  have been
satisfied  and  performed  in full,  Dollar Tree Stores,  Inc.  shall retain the
Lessee as a Wholly-Owned Entity.

         5.11     Unilateral Right  to Increase  the Holder  Commitments and the
                  Lender Commitments.

         Notwithstanding  any other provision of any Operative  Agreement or any
objection  by any Person  (including  without  limitation  any  objection by any
Credit  Party),  the Bank, in its sole  discretion,  may  unilaterally  elect to
increase  its  Holder  Commitment  and its  Lender  Commitment  in order to fund
amounts due and owing pursuant to Sections 7.1 and 11.5.


                   SECTION 6. REPRESENTATIONS AND WARRANTIES.

         6.1      Representations and Warranties of the Borrower.

         Effective as of the Initial  Closing Date and the date of each Advance,
         the Trust Company in its  individual  capacity and as the Borrower,  as
         indicated,  represents and warrants (in addition to any representations
         or  warranties  made  in  any  Officer's  or  Secretary's   Certificate
         delivered  pursuant hereto,  which  representations  and warranties are
         incorporated  herein by reference) to each of the other parties  hereto
         that  the  execution,   delivery  and  performance  of  each  Operative
         Agreement to which it is or will be a party,  either in its  individual
         capacity or (assuming due authorization,  execution and delivery of the
         Trust Agreement by the Bank) as the Owner Trustee,  as the case may be,
         has  been  duly  authorized  by all  necessary  action  on its part and
         neither the execution and delivery thereof, nor the consummation of the
         transactions contemplated thereby, nor compliance by it with any of the
         terms and  provisions  thereof (i) does or will require any approval or

                                       12

<PAGE>


         consent  of any  trustee  or  holders  of any  of its  indebtedness  or
         obligations,  (ii)  does  or  will  contravene  any  Legal  Requirement
         relating to its banking or trust powers,  (iii) does or will contravene
         or result in any breach of or constitute any default  under,  or result
         in the  creation of any Lien upon any of its  property  under,  (A) its
         charter or by-laws, or (B) any indenture,  mortgage,  chattel mortgage,
         deed  of  trust,  conditional  sales  contract,  bank  loan  or  credit
         agreement or other agreement or instrument to which it is a party or by
         which  it  or  its   properties   may  be  bound  or  affected,   which
         contravention,   breach,   default  or  Lien  under  clause  (B)  would
         materially and adversely affect its ability, in its individual capacity
         or as the Owner Trustee, to perform its obligations under the Operative
         Agreements  to  which it is a party or (iv)  does or will  require  any
         Governmental  Action  by  any  Governmental  Authority  regulating  its
         banking or trust powers.

         6.2      Representations and Warranties of Each Credit Party.

         Effective as of the Initial Closing Date, the date of each Advance, the
date  each  Domestic  Subsidiary  delivers  a  Joinder  Agreement  and the  Rent
Commencement  Date,  each Credit  Party  represents  and warrants to each of the
other parties hereto that:

                  (a)  The  Lessee  has  delivered  to the  Bank  the  financial
         statements  and other reports  referred to in Section 7.4 of the Lessee
         Credit Agreement;

                  (b) The  execution  and  delivery by each Credit Party of this
         Agreement and the other applicable Operative Agreements as of such date
         and the performance by each Credit Party of its respective  obligations
         under this Agreement and the other applicable  Operative Agreements are
         within  the  corporate  powers  of each  Credit  Party,  have been duly
         authorized by all necessary corporate action on the part of each Credit
         Party (including without limitation any necessary  shareholder action),
         have been duly  executed and  delivered,  have  received all  necessary
         governmental  approval,  and do not and will not (i)  violate any Legal
         Requirement  which  is  binding  on any  Credit  Party  or any of their
         Subsidiaries,  (ii)  contravene or conflict with, or result in a breach
         of, any  provision of the Articles of  Incorporation,  By-Laws or other
         organizational   documents   of  any  Credit  Party  or  any  of  their
         Subsidiaries  or of  any  agreement,  indenture,  instrument  or  other
         document  which  is  binding  on any  Credit  Party  or  any  of  their
         Subsidiaries or (iii) result in, or require, the creation or imposition
         of any  Lien  (other  than  pursuant  to  the  terms  of the  Operative
         Agreements)  on  any  asset  of  any  Credit  Party  or  any  of  their
         Subsidiaries;

         (c)      (i)  This  Agreement  and   the  other   applicable  Operative
         Agreements, executed prior to and as of such date by each Credit Party,
         constitute  the  legal,  valid  and  binding  obligation of such Credit
         Party,  as  applicable,  enforceable  against  such  Credit  Party,  in
         accordance with their terms. Each Credit Party has executed the various
         Operative Agreements required to be executed by such Credit Party as of
         such date;

                  (ii)  The  Security  Documents  create,  as  security  for the
         Obligations (as such term is defined in the Security Agreement),  valid
         and  enforceable  security  interests  in,  and  Liens  on,  all of the
         Collateral, in favor of the Bank, and such security interests and

                                       13

<PAGE>


         Liens are subject to no other Liens other than Liens that are expressly
         set  forth  as  title  exceptions on the title commitment  issued under
         Section 5.3(g) with respect to the applicable  Property,  to the extent
         such title commitment has  been  approved by the Bank. Upon recordation
         of  the  Mortgage  Instrument  in  the  real  estate  recording  office
         identified by the Construction Agent or the Lessee, the Lien created by
         the Mortgage Instrument in the real property described therein shall be
         a perfected first priority  mortgage Lien on such real property (or, in
         the  case  of  a  Ground  Lease, the leasehold estate under such Ground
         Lease) in favor of the Bank. To the extent that the security  interests
         in the portion of the Collateral comprised of personal  property can be
         perfected  by   filing  in  the   filing   offices  identified  by  the
         Construction Agent or the Lessee, upon  filing of the Lender  Financing
         Statements  in such filing  offices, the security interests created  by
         the  Security  Agreement  shall  be  perfected  first priority security
         interests in such personal property in favor of the Bank; and

                  (iii)  The  Lease  Agreement  creates,  as  security  for  the
         obligations  of  the  Lessee  under  the  Lease  Agreement,  valid  and
         enforceable  security  interests in, and Liens on, each Property leased
         thereunder,  in favor of the Lessor,  and such  security  interests and
         Liens are subject to no other Liens other than Liens that are expressly
         set forth as title  exceptions  on the title  commitment  issued  under
         Section 5.3(g) with respect to the applicable  Property,  to the extent
         such title  commitment has been approved by the Bank. Upon  recordation
         of the memorandum of the Lease Agreement and the memorandum of a Ground
         Lease  (or,  in either  case,  a short form  lease) in the real  estate
         recording office  identified by the  Construction  Agent or the Lessee,
         the Lien created by the Lease Agreement in the real property  described
         therein shall be a perfected first priority  mortgage Lien on such real
         property (or, in the case of a Ground Lease, the leasehold estate under
         such  Ground  Lease)  in  favor of the  Bank.  To the  extent  that the
         security interests in the portion of any Property comprised of personal
         property  can  be  perfected  by  the  filing  in  the  filing  offices
         identified by the  Construction  Agent or the Lessee upon filing of the
         Lessor Financing Statements in such filing offices, a security interest
         created  by the  Lease  Agreement  shall be  perfected  first  priority
         security  interests in such  personal  property in favor of the Lessor,
         which rights pursuant to the Lessor  Financing  Statements are assigned
         to the Bank;

                  (d)  There  are no  material  actions,  suits  or  proceedings
         pending or, to our  knowledge,  threatened  against any Credit Party in
         any court or before any  Governmental  Authority  (nor shall any order,
         judgment  or decree  have been  issued or  proposed to be issued by any
         Governmental  Authority to set aside,  restrain,  enjoin or prevent the
         full  performance  of  any  Operative   Agreement  or  any  transaction
         contemplated  thereby)  that (i)  concern  any  Property  or any Credit
         Party's   interest   therein  or  (ii)   question   the   validity   or
         enforceability of any Operative  Agreement to which any Credit Party is
         a  party  or  the  overall  transaction   described  in  the  Operative
         Agreements to which any Credit Party is a party; provided, for purposes
         of disclosure, each Credit Party has described the litigation set forth
         on Exhibit K;

                                       14

<PAGE>

                  (e) No Governmental  Action by any  Governmental  Authority or
         other authorization, registration, consent, approval, waiver, notice or
         other  action  by,  to or of any  other  Person  pursuant  to any Legal
         Requirement,  contract,  indenture,  instrument or agreement or for any
         other reason is required to authorize or is required in connection with
         (i) the execution,  delivery or performance of any Operative Agreement,
         (ii) the legality,  validity,  binding effect or  enforceability of any
         Operative Agreement,  (iii) the acquisition,  ownership,  construction,
         completion, occupancy, operation, leasing or subleasing of any Property
         or (iv) any  Advance,  in each  case,  except  those  which  have  been
         obtained and are in full force and effect;

                  (f) Upon the execution  and delivery of each Lease  Supplement
         to the Lease,  (i) the Lessee will have  unconditionally  accepted  the
         Property  subject  to the  Lease  Supplement  and will have a valid and
         subsisting  leasehold  interest in such  Property,  subject only to the
         Permitted Liens, and (ii) no offset will exist with respect to any Rent
         or other sums payable under the Lease;

                  (g)  Except  as  otherwise   contemplated   by  the  Operative
         Agreements,  the  Construction  Agent shall not use the proceeds of any
         Holder  Advance or Loan for any purpose other than the purchase  and/or
         lease of the Properties,  the acquisition,  installation and testing of
         the Equipment,  the  construction  of  Improvements  and the payment of
         Transaction  Expenses and the fees,  expenses  and other  disbursements
         referenced in Section 7.1 of this Agreement,  in each case which accrue
         prior  to the Rent  Commencement  Date  with  respect  to a  particular
         Property;

                  (h) All information  heretofore or contemporaneously  herewith
         furnished by the Credit  Parties or their  Subsidiaries  to the Bank or
         the Owner Trustee for purposes of or in connection  with this Agreement
         and the  transactions  contemplated  hereby  is,  and  all  information
         hereafter  furnished  by or on behalf of the  Credit  Parties  or their
         Subsidiaries  to the Bank or the Owner  Trustee  pursuant  hereto or in
         connection  herewith  will be,  true  and  accurate  in every  material
         respect on the date as of which such information is dated or certified,
         and such  information,  taken as a whole, does not and will not omit to
         state any material fact necessary to make such information,  taken as a
         whole, not misleading;

                  (i) The principal place of business,  chief  executive  office
         and  office  of  the  Construction  Agent  and  the  Lessee  where  the
         documents,   accounts   and  records   relating  to  the   transactions
         contemplated by this Agreement and each other  Operative  Agreement are
         kept are located at 500 Volvo Parkway,  Chesapeake,  Virginia 23320 and
         the states of formation and the chief  executive  offices of each other
         Credit Party are located at the places set forth in EXHIBIT L;

                  (j) The  representations  and  warranties of each Credit Party
         set  forth  in  any  of  the  Operative   Agreements   (including   the
         Incorporated  Representations  and  Warranties) are true and correct in
         all material  respects on and as of each such date as if made on and as
         of  such  date.  Each  Credit  Party  is in all  material  respects  in
         compliance  with its  obligations  under the Operative  Agreements  and
         there exists no Default or Event of

                                       15

<PAGE>


         Default  under any of the Operative Agreements  which is continuing and
         which has not been cured within any cure period expressly granted under
         the terms of the applicable Operative  Agreement or otherwise waived in
         accordance with the applicable Operative Agreement. No Default or Event
         of Default will occur under any of the Operative Agreements as a result
         of, or after giving effect to, the Advance requested by the Requisition
         on the date of each Advance; and

                  (k) As of  each  Property  Closing  Date,  the  date  of  each
         subsequent  Advance and the Rent  Commencement Date only, no portion of
         any Property is located in an area identified as a special flood hazard
         area by the Federal  Emergency  Management  Agency or other  applicable
         agency,  or if any such Property is located in an area  identified as a
         special flood hazard area by the Federal Emergency Management Agency or
         other  applicable  agency,  then flood  insurance has been obtained for
         such  Property in accordance  with Section  14.2(b) of the Lease and in
         accordance with the National Flood Insurance Act of 1968, as amended

                              SECTION 6B. GUARANTY

         6B.1     Guaranty of Payment and Performance.

         Subject to Section 6B.7, each Guarantor hereby,  jointly and severally,
unconditionally  guarantees  to each  Financing  Party the  prompt  payment  and
performance  of the  Company  Obligations  in full when due  (whether  at stated
maturity, as a mandatory prepayment,  by acceleration or otherwise) or when such
is otherwise to be  performed;  provided,  notwithstanding  the  foregoing,  the
obligations  of the  Guarantors  under this  Section 6B shall not  constitute  a
direct  guaranty of the  indebtedness  of the Lessor  evidenced by the Notes but
rather a  guaranty  of the  Company  Obligations  arising  under  the  Operative
Agreements.  This Section 6B is a guaranty of payment and performance and not of
collection  and  is a  continuing  guaranty  and  shall  apply  to  all  Company
Obligations  whenever arising. All rights granted to the Financing Parties under
this Section 6B shall be subject to the provisions of Section 8.2(h) and 8.6.

         6B.2     Obligations Unconditional.

         Each Guarantor agrees that the obligations of the Guarantors  hereunder
are  absolute  and  unconditional,   irrespective  of  the  value,  genuineness,
validity,  regularity or enforceability of any of the Operative  Agreements,  or
any other  agreement or  instrument  referred to therein,  or any  substitution,
release or exchange of any other guarantee of or security for any of the Company
Obligations,   and,  to  the  fullest  extent   permitted  by  applicable   law,
irrespective  of  any  other  circumstance   whatsoever  which  might  otherwise
constitute a legal or equitable  discharge or defense of a surety,  guarantor or
co-obligor, it being the intent of this Section 6B.2 that the obligations of the
Guarantors  hereunder  shall be  absolute  and  unconditional  under any and all
circumstances. Each Guarantor agrees that this Section 6B may be enforced by the
Financing  Parties  without  the  necessity  at  any  time  of  resorting  to or
exhausting  any other  security or  collateral  and without the necessity at any
time of having  recourse  to the  Notes,  the  Certificates  or any other of the
Operative  Agreements or any collateral,  if any, hereafter securing the

                                       16

<PAGE>


Company  Obligations or otherwise and each Guarantor  hereby waives the right to
require the Financing  Parties to proceed against the  Construction  Agent,  the
Lessee or any other Person (including  without  limitation a co-guarantor) or to
require the  Financing  Parties to pursue any other  remedy or enforce any other
right.  Each Guarantor further agrees that it hereby waives any and all right of
subrogation, indemnity, reimbursement or contribution against the Lessee and the
Construction Agent or any other Guarantor of the Company Obligations for amounts
paid under  this  Section  6B until  such time as the  Loans,  Holder  Advances,
accrued  but unpaid  interest,  accrued  but unpaid  Holder  Yield and all other
amounts owing under the  Operative  Agreements  have been paid in full.  Without
limiting  the  generality  of the waiver  provisions  of this  Section  6B, each
Guarantor  hereby waives any rights to require the Financing  Parties to proceed
against the  Construction  Agent,  the Lessee or any  co-guarantor or to require
Lessor to pursue any other remedy or enforce any other right,  including without
limitation, any and all rights under N.C. Gen. Stat. ss. 26-7 through 26-9. Each
Guarantor  further  agrees  that  nothing  contained  herein  shall  prevent the
Financing  Parties  from suing on any  Operative  Agreement or  foreclosing  any
security  interest in or Lien on any  collateral,  if any,  securing the Company
Obligations  or from  exercising  any  other  rights  available  to it under any
Operative  Agreement,  or any other  instrument  of  security,  if any,  and the
exercise of any of the aforesaid  rights and the  completion of any  foreclosure
proceedings  shall not  constitute  a discharge of any  Guarantor's  obligations
hereunder;  it  being  the  purpose  and  intent  of  each  Guarantor  that  its
obligations hereunder shall be absolute, independent and unconditional under any
and all circumstances; provided that any amounts due under this Section 6B which
are paid to or for the benefit of any  Financing  Party shall reduce the Company
Obligations  by a  corresponding  amount  (unless  required to be rescinded at a
later date).  Neither any Guarantor's  obligations under this Section 6B nor any
remedy for the  enforcement  thereof  shall be  impaired,  modified,  changed or
released  in any  manner  whatsoever  by an  impairment,  modification,  change,
release or limitation of the liability of the  Construction  Agent or the Lessee
or by reason of the  bankruptcy or insolvency of the  Construction  Agent or the
Lessee.  Each  Guarantor  waives  any and all notice of the  creation,  renewal,
extension or accrual of any of the Company Obligations and notice of or proof of
reliance  by any  Financing  Party upon this  Section 6B or  acceptance  of this
Section 6B. The Company  Obligations  shall  conclusively be deemed to have been
created,  contracted or incurred,  or renewed,  extended,  amended or waived, in
reliance upon this Section 6B. All dealings between the Construction  Agent, the
Lessee and any of the Guarantors, on the one hand, and the Financing Parties, on
the other  hand,  likewise  shall be  conclusively  presumed to have been had or
consummated in reliance upon this Section 6B.

         6B.3     Modifications.

         Each  Guarantor  agrees that (a) all or any part of the security now or
hereafter  held  for  the  Company  Obligations,   if  any,  may  be  exchanged,
compromised or surrendered  from time to time; (b) no Financing Party shall have
any  obligation  to  protect,  perfect,  secure  or  insure  any  such  security
interests,  liens or encumbrances now or hereafter held, if any, for the Company
Obligations or the properties subject thereto;  (c) the time or place of payment
of the Company Obligations may be changed or extended, in whole or in part, to a
time certain or  otherwise,  and may be renewed or  accelerated,  in whole or in
part;  (d) the  Construction  Agent,  the Lessee and any other party  liable for
payment under the Operative Agreements may be granted indulgences

                                       17

<PAGE>


generally;  (e) any of the provisions of the Notes,  the  Certificates or any of
the other Operative Agreements may be modified, amended or waived; (f) any party
(including  any  co-guarantor)  liable for the  payment  thereof  may be granted
indulgences  or be released;  and (g) any deposit  balance for the credit of the
Construction  Agent, the Lessee or any other party liable for the payment of the
Company  Obligations  or liable upon any security  therefor may be released,  in
whole or in part,  at,  before  or after the  stated,  extended  or  accelerated
maturity of the Company Obligations,  all without notice to or further assent by
such  Guarantor,  which shall remain  bound  thereon,  notwithstanding  any such
exchange, compromise, surrender, extension, renewal, acceleration, modification,
indulgence or release.

         6B.4     Waiver of Rights.

         Each  Guarantor  expressly  waives to the fullest  extent  permitted by
applicable  law: (a) notice of  acceptance  of this Section 6B by any  Financing
Party and of all  extensions  of credit or other  Advances  to the  Construction
Agent and the Lessee by Bank pursuant to the terms of the Operative  Agreements;
(b)  presentment  and demand for  payment or  performance  of any of the Company
Obligations;  (c) protest and notice of dishonor or of default  with  respect to
the Company Obligations or with respect to any security therefor;  (d) notice of
any Financing Party obtaining, amending, substituting for, releasing, waiving or
modifying any security interest, lien or encumbrance, if any, hereafter securing
the Company Obligations,  or any Financing Party's subordinating,  compromising,
discharging or releasing such security interests, liens or encumbrances, if any;
and (e) all other notices to which such Guarantor  might  otherwise be entitled.
Notwithstanding  anything to the contrary herein, (i) each Guarantor's  payments
hereunder  shall be due five (5) Business Days after written  demand by the Bank
for such payment (unless the Company  Obligations are automatically  accelerated
pursuant to the applicable  provisions of the Operative Agreements in which case
the Guarantors'  payments shall be automatically  due) and (ii) any modification
of the  Operative  Agreements  which has the effect of  increasing  the  Company
Obligations  shall not be enforceable  against a Guarantor unless such Guarantor
executes the document  evidencing such  modification or otherwise  reaffirms its
guaranty in writing in connection with such modification.

         6B.5     Reinstatement.

         The  obligations  of the  Guarantors  under  this  Section  6B shall be
automatically reinstated if and to the extent that for any reason any payment by
or on behalf of any Person in respect of the Company Obligations is rescinded or
must be  otherwise  restored  by any holder of any of the  Company  Obligations,
whether  as a result of any  proceedings  in  bankruptcy  or  reorganization  or
otherwise, and each Guarantor agrees that it will indemnify each Financing Party
on demand for all reasonable costs and expenses (including,  without limitation,
reasonable  fees of counsel)  incurred by any Financing Party in connection with
such rescission or restoration,  including without limitation any such costs and
expenses  incurred in  defending  against any claim  alleging  that such payment
constituted  a  preference,  fraudulent  transfer or similar  payment  under any
bankruptcy, insolvency or similar law.

                                       18

<PAGE>

         6B.6     Remedies.

         The Guarantors agree that, as between the Guarantors,  on the one hand,
and each  Financing  Party,  on the other hand, the Company  Obligations  may be
declared  to be  forthwith  due  and  payable  as  provided  in  the  applicable
provisions  of the  Operative  Agreements  (and  shall be deemed to have  become
automatically   due  and  payable  in  the   circumstances   provided   therein)
notwithstanding  any  stay,  injunction  or other  prohibition  preventing  such
declaration (or preventing such Company Obligations from becoming  automatically
due and  payable)  as against  any other  Person and that,  in the event of such
declaration   (or  such  Company   Obligations   being  deemed  to  have  become
automatically due and payable), such Company Obligations (whether or not due and
payable by any other  Person)  shall  forthwith  become  due and  payable by the
Guarantors  in  accordance  with  the  applicable  provisions  of the  Operative
Agreements.

         6B.7     Limitation of Guaranty.

         Notwithstanding  any provision to the contrary  contained  herein or in
any of the other  Operative  Agreements,  to the extent the  obligations  of any
Guarantor  shall be  adjudicated to be invalid or  unenforceable  for any reason
(including  without  limitation  because of any applicable  state or federal law
relating to fraudulent  conveyances or transfers)  then the  obligations of such
Guarantor  hereunder  shall be limited to the maximum amount that is permissible
under applicable law (whether federal or state and including without  limitation
the Bankruptcy Code).

         Subject  to  Section  6B.5,  upon  the   satisfaction  of  the  Company
Obligations  in full,  regardless  of the  source of  payment,  the  Guarantors'
obligations hereunder shall be deemed satisfied, discharged and terminated other
than indemnifications set forth herein that expressly survive.

         6B.8     Payment of Amounts to Bank.

         Each  Financing  Party  hereby  instructs  each  Guarantor,   and  each
Guarantor hereby  acknowledges and agrees, that until such time as the Loans and
the Holder  Advances  are paid in full and the Liens  evidenced  by the Security
Agreement  and the  Mortgage  Instruments  have been  released  any and all Rent
(excluding  Excepted  Payments  which  shall be payable to each other  Person as
appropriate)  and any and all other amounts of any kind or type under any of the
Operative  Agreements  due and owing or payable to any Person  shall  instead be
paid directly to Bank  (excluding  Excepted  Payments  which shall be payable to
each other  Person as  appropriate)  or as Bank may direct from time to time for
allocation in accordance with Section 8.7 hereof.

                     SECTION 7. PAYMENT OF CERTAIN EXPENSES.

         7.1      Transaction Expenses.

                  (a)  Assuming  no  Default  or Event  of  Default  shall  have
         occurred and be  continuing,  the Lessor  agrees to pay, or cause to be
         paid, all Transaction Expenses; provided, however, the Lessor shall pay
         such amounts  described in this Section 7.1(a)

                                       19

<PAGE>


         only  if  (i)  such  amounts  are  properly  described in a Requisition
         delivered in accordance  with  the Operative Agreements, and (ii) funds
         are made available by the Bank in connection  with such  Requisition in
         an amount  sufficient to allow such payment.

                  (b) [Intentionally Left Blank].

                  (c) All fees  payable  pursuant  to the  Operative  Agreements
         shall be calculated on the basis of a year of three hundred sixty (360)
         days for the actual days elapsed.

         7.2      Brokers Fees.

         The Lessor agrees to pay or cause to be paid any and all brokers' fees,
if any, including without  limitation any interest and penalties thereon,  which
are payable in connection with the  transactions  contemplated by this Agreement
and the other Operative Agreements; provided, however, the Lessor shall pay such
amounts  described  in this  Section 7.2 only if (i) such  amounts are  properly
described  in  a  Requisition   delivered  in  accordance   with  the  Operative
Agreements,  and (ii) funds are made  available by the Bank in  connection  with
such Requisition in an amount sufficient to allow such payment.

         7.3      Certain Fees and Expenses.

         The Lessor agrees to pay or cause to be paid (a) the initial and annual
Owner  Trustee's  fee and all  reasonable  expenses of the Owner Trustee and any
co-trustees  (including without limitation reasonable counsel fees and expenses)
or any  successor  owner  trustee  and/or  co-trustee,  for  acting as the owner
trustee  under the  Trust  Agreement,  (b) all  reasonable  costs  and  expenses
incurred  by the Credit  Parties,  the Bank or the Lessor in  entering  into any
Lease  Supplement  and  any  future  amendments,   modifications,   supplements,
restatements   and/or   replacements  with  respect  to  any  of  the  Operative
Agreements,  whether or not such Lease  Supplement,  amendments,  modifications,
supplements,  restatements  and/or  replacements are ultimately entered into, or
giving or withholding of waivers of consents hereto or thereto,  which have been
requested by the Lessee,  the Bank or the Lessor,  (c) all reasonable  costs and
expenses incurred by any Credit Party, the Bank or the Lessor in connection with
any exercise of remedies  under any  Operative  Agreement or any purchase of any
Property by the  Construction  Agent,  the Lessee or any third party and (d) all
reasonable  costs and expenses  incurred by the Credit Parties,  the Bank or the
Lessor in connection with any transfer or conveyance of any Property, whether or
not such transfer or conveyance is ultimately accomplished;  provided,  however,
the Lessor shall pay such amounts described in this Section 7.3 only if (i) such
amounts are properly described in a Requisition delivered in accordance with the
Operative  Agreements,  and  (ii)  funds  are  made  available  by the  Bank  in
connection with such Requisition in an amount sufficient to allow such payment.

                                       20

<PAGE>

                   SECTION 8. OTHER COVENANTS AND AGREEMENTS.

         8.1 Cooperation with the Construction Agent or the Lessee.

         The Bank and the Lessor (at the  direction of the Bank)  shall,  at the
expense of and to the extent reasonably  requested by the Construction  Agent or
the Lessee (but without assuming  additional  liabilities on account thereof and
only to the  extent  such is  acceptable  to the  Bank  and the  Lessor  (at the
direction  of the  Bank)  in  its  reasonable  discretion,  cooperate  with  the
Construction  Agent or the Lessee in connection with the  Construction  Agent or
the Lessee  satisfying  its  covenant  obligations  contained  in the  Operative
Agreements  including  without  limitation  at any time  and from  time to time,
promptly and duly executing and delivering any and all such further instruments,
documents  and  financing   statements  (and  continuation   statements  related
thereto).

         8.2      Covenants of the Owner Trustee and the Bank.

         Each of the Owner  Trustee and the Bank  hereby  agrees that so long as
this Agreement is in effect:

                  (a) Neither the Owner Trustee (in its trust capacity or in its
         individual capacity) nor the Bank will create or permit to exist at any
         time, and each of them will, at its own cost and expense, promptly take
         such action as may be necessary  duly to  discharge,  or to cause to be
         discharged,  all Lessor  Liens on the  Properties  attributable  to it;
         provided,  however,  that the Owner  Trustee  and the Bank shall not be
         required to so  discharge  any such Lessor Lien while the same is being
         contested  in  good  faith  by   appropriate   proceedings   diligently
         prosecuted  so  long as  such  proceedings  shall  not  materially  and
         adversely affect the rights of the Lessee under the Lease and the other
         Operative  Agreements  or involve any material  danger of impairment of
         the Liens of the Security Documents or of the sale,  forfeiture or loss
         of,  and  shall  not  interfere  with the use or  disposition  of,  any
         Property  or title  thereto or any  interest  therein or the payment of
         Rent;

                  (b) Without  prejudice to any right under the Trust  Agreement
         of the Owner Trustee to resign (subject to requirement set forth in the
         Trust  Agreement that such  resignation  shall not be effective until a
         successor shall have agreed to accept such appointment),  or the Bank's
         rights under the Trust  Agreement to remove the  institution  acting as
         the Owner Trustee, each of the Owner Trustee and the Bank hereby agrees
         with the Lessee (i) not to terminate or revoke the trust created by the
         Trust  Agreement  except  as  permitted  by  Article  VIII of the Trust
         Agreement,  (ii) not to  amend,  supplement,  terminate  or  revoke  or
         otherwise  modify any provision of the Trust Agreement in such a manner
         as to adversely  affect the rights of any such party  without the prior
         written consent of such party and (iii) to comply with all of the terms
         of the Trust  Agreement,  the  nonperformance  of which would adversely
         affect such party;

                                       21

<PAGE>


                  (c) The  Owner  Trustee  or any  successor  may  resign  or be
         removed by the Bank as the Owner Trustee, a successor Owner Trustee may
         be appointed and a  corporation  may become the Owner Trustee under the
         Trust  Agreement,  only in accordance with the provisions of Article IX
         of the Trust Agreement and, with respect to such appointment,  with the
         consent  of the  Lessee  (so long as there  shall be no Lease  Event of
         Default that shall have  occurred  and be  continuing),  which  consent
         shall not be unreasonably withheld or delayed;

                  (d) The Owner  Trustee,  in its capacity as the Owner  Trustee
         under the Trust Agreement,  and not in its individual  capacity,  shall
         not contract for, create,  incur or assume any  Indebtedness,  or enter
         into any  business  or other  activity or enter into any  contracts  or
         agreements, other than pursuant to or under the Operative Agreements;

                  (e) The Bank will not instruct  the Owner  Trustee to take any
         action in violation of the terms of any Operative Agreement;

                  (f) Neither the Bank nor the Owner  Trustee shall (i) commence
         any case,  proceeding or other action with respect to the Owner Trustee
         under any  existing  or future  law of any  jurisdiction,  domestic  or
         foreign,   relating   to   bankruptcy,   insolvency,    reorganization,
         arrangement, winding-up, liquidation, dissolution, composition or other
         relief with respect to it or its debts,  or (ii) seek  appointment of a
         receiver,  trustee, custodian or other similar official with respect to
         the  Owner  Trustee  or  for  all  or any  substantial  benefit  of the
         creditors  of the Owner  Trustee;  and  neither  the Bank nor the Owner
         Trustee  shall take any action in  furtherance  of, or  indicating  its
         consent to, approval of, or acquiescence  in, any of the acts set forth
         in this paragraph;

                  (g) The Owner  Trustee  shall give prompt notice to the Lessee
         and the Bank if the Owner  Trustee's  principal  place of  business  or
         chief executive office, or the office where the records  concerning the
         accounts or contract  rights  relating to any Property are kept,  shall
         cease to be  located  at 79 South Main  Street,  Salt Lake  City,  Utah
         84111, or if it shall change its name; and

                  (h) The Owner  Trustee  shall take or refrain from taking such
         actions and grant or refrain from granting such  approvals with respect
         to the  Operative  Agreements  and/or  relating to any Property in each
         case as directed in writing by the Bank.

         8.3      Credit Party Covenants, Consent and Acknowledgment.

                  (a) Each Credit Party  acknowledges  and agrees that the Owner
         Trustee, pursuant to the terms and conditions of the Security Agreement
         and the Mortgage Instruments, shall create Liens respecting the various
         personal  property,  fixtures and real  property  described  therein in
         favor of the Bank. Each Credit Party hereby irrevocably consents to the
         creation,  perfection and maintenance of such Liens.  Each Credit Party
         shall, to the extent  reasonably  requested by any of the other parties
         hereto,  cooperate  with the other  parties  in  connection  with their
         covenants  herein or in the other  Operative

                                       22

<PAGE>


         Agreements and shall from time to time duly execute and deliver any and
         all such future instruments, documents and  financing  statements  (and
         continuation statements related  thereto) as any other party hereto may
         reasonably request.

                  (b) The Lessor hereby  instructs  each Credit Party,  and each
         Credit Party hereby  acknowledges  and agrees,  that until such time as
         the  Loans  and the  Holder  Advances  are paid in full  and the  Liens
         evidenced by the Security  Agreement and the Mortgage  Instruments have
         been released (i) any and all Rent (excluding  Excepted  Payments which
         shall be payable to any other  Person as  appropriate)  and any and all
         other amounts of any kind or type under any of the Operative Agreements
         due and owing or payable to any Person shall  instead be paid  directly
         to the Bank (excluding  Excepted Payments which shall be payable to any
         other  Person as  appropriate)  or as the Bank may direct  from time to
         time for  allocation  in accordance  with Section 8.7 hereof,  (ii) all
         rights of the Lessor under the Lease shall be exercised by the Bank and
         (iii)  each  Credit  Party  shall  cause  all  notices,   certificates,
         financial  statements,  communications  and other information which are
         delivered,  or are required to be delivered,  to the Lessor, to also be
         delivered at the same time to the Bank.

                  (c) No Credit Party shall consent to or permit any  amendment,
         supplement  or other  modification  of the terms or  provisions  of any
         Operative  Agreement  except in  accordance  with  Section 12.4 of this
         Agreement.

                  (d) Each Credit Party hereby covenants and agrees that, except
         for  amounts  payable as Basic Rent,  any and all  payment  obligations
         owing from time to time under the Operative Agreements by any Person to
         the Bank or any other Person shall (without  further  action) be deemed
         to be Supplemental Rent obligations payable by the Lessee and the other
         Credit Parties.

                  (e) At any time the Lessor or the Bank is  entitled  under the
         Operative  Agreements  to  possession  of a Property  or any  component
         thereof, each of the Construction Agent and the Lessee hereby covenants
         and agrees, at its own cost and expense,  to assemble and make the same
         available to the Bank (on behalf of the Lessor).

                  (f) The Lessee  hereby  covenants and agrees that Advances for
         items other than Land and Improvements respecting any individual parcel
         of Property shall at no time  constitute in excess of ten percent (10%)
         of the aggregate Advances  respecting such parcel of Property funded at
         such time under the Operative Agreements.

                  (g) The Lessee hereby  covenants and agrees that it shall give
         prompt notice to the Bank if the Lessee's  principal  place of business
         or chief executive office,  or the office where the records  concerning
         the  accounts or contract  rights  relating to any  Property  are kept,
         shall cease to be located at 500 Volvo  Parkway,  Chesapeake,  Virginia
         23320 or if it shall change its name.

                                       23

<PAGE>

                  (h) Each Credit Party shall promptly notify the Bank, or cause
         the Bank to be  promptly  notified,  upon  such  Credit  Party  gaining
         knowledge of the occurrence of any Default or Event of Default which is
         continuing at such time. In any event, such notice shall be provided to
         the Bank  within  ten (10) days of when such  Credit  Party  gains such
         knowledge.

                  (i) Lessee shall take all action that Lessee  deems  necessary
         to assure that Lessee's  computer based systems are able to operate and
         effectively process data including dates on and after January 1, 2000.

                  (j) Lessee  shall  perform any and all  obligations  of Lessor
         under,  and cause Lessor to otherwise  remain in full compliance  with,
         the terms and provisions of each Ground Lease, if any.

                  (k) Until all the  obligations of the Credit Parties under the
         Operative  Agreements  have  been  finally  and  indefeasibly  paid and
         satisfied  in  full,  the  Commitments   and  the  Holder   Commitments
         terminated  and the Term has expired or been  earlier  terminated,  the
         Lessee will furnish or cause to be furnished to Bank at the address set
         forth or  referenced in Section 12.2 of this  Agreement,  or such other
         office as may be  designated  by Bank from time to time:  (i) not later
         than  forty-five  (45) days  after the end of each  fiscal  quarter,  a
         certificate duly signed by the chief executive officer, chief operating
         officer,  chief  financial  officer,  treasurer  or  controller  of DTS
         setting  forth the ratio of  Consolidated  Funded Debt to  Consolidated
         EBITDA for the period of four (4)  consecutive  fiscal  quarters ending
         with such  quarter-end and setting forth the  computations  employed in
         calculating the ratio (the "Margin  Certificate") and (ii) at each time
         financial  statements  are  delivered  or to be  delivered  pursuant to
         Section  8.3(m)  hereof or  Section  28.1 of the  Lease,  a  compliance
         certificate duly executed by the president,  treasurer, chief financial
         offer or  controller  of DTS  substantially  in the form of  Exhibit  M
         attached hereto (the "Officer's Compliance Certificate").

                  (l) Each Credit  Party  hereby  covenants  and agrees to cause
         each Domestic  Subsidiary  formed or acquired after the Initial Closing
         Date to  execute  a  Joinder  Agreement  and to  observe  the  terms of
         Sections  5.9(a)-(d) of this Agreement,  all within thirty (30) days of
         the formation or acquisition of such Domestic Subsidiary.

                  (m) The Lessee  hereby  covenants and agrees to provide (i) no
         later than one hundred  twenty  (120) days after the fiscal year end of
         DTS, the consolidated,  audited and unqualified financial statements of
         DTS, as prepared in accordance  with GAAP by an  independent  certified
         public accountant acceptable to the Bank and (ii) no later than 45 days
         after   the   end  of   each   fiscal   quarter   of   DTS,   quarterly
         management-prepared consolidated financial statements of DTS, including
         a balance sheet, a profit and loss statement and a statement of changes
         in cash flow.

         8.4      Allocation of Certain Payments.

                                       24

<PAGE>


         Except for Excepted Payments,  the parties hereto acknowledge and agree
that all  payments  due and owing by the Lessee to the Lessor under the Lease or
any of the other  Operative  Agreements  shall be made by the Lessee directly to
the Bank as more particularly  provided in Section 8.3 hereof.  The Lessor,  the
Bank and the  Lessee  acknowledge  the terms of  Section  8.7 of this  Agreement
regarding  the  allocation  of payments and other  amounts made or received from
time to time under the Operative  Agreements  and agree,  that all such payments
and amounts are to be allocated as provided in Section 8.7 of this Agreement.

         8.5      Grant of Easements, etc.

         The Bank hereby  agrees that, so long as no Event of Default shall have
occurred and be continuing,  the Owner Trustee  shall,  from time to time at the
request of the Lessee (and with the prior consent of the Bank, which consent the
Bank  will  not  withhold  or  delay  unreasonably),   in  connection  with  the
transactions  contemplated  by the  Agency  Agreement,  the  Lease or the  other
Operative  Agreements,  (i) grant  easements  and other  rights in the nature of
easements with respect to any Property, (ii) release existing easements or other
rights in the nature of  easements  which are for the  benefit of any  Property,
(iii) execute and deliver to any Person any instrument appropriate to confirm or
effect such grants or releases,  and (iv) execute and deliver to any Person such
other  documents or materials in connection with the  acquisition,  development,
construction, testing or operation of any Property, including without limitation
reciprocal easement agreements,  construction  contracts,  operating agreements,
development agreements, plats, replats or subdivision documents;  provided, that
each of the  agreements  referred  to in this  Section  8.5 shall be of the type
normally  executed by the Lessee in the ordinary course of the Lessee's business
and shall be on commercially reasonable terms so as not to diminish the value of
any Property in any material respect.

         8.6      Appointment by the Bank and the Owner Trustee.

         The Bank is appointed to provide notices under the Operative Agreements
on behalf of the Owner Trustee (as  determined  by the Bank,  in its  reasonable
discretion),  to receive notices under the Operative Agreements on behalf of the
Owner  Trustee and  (subject to Sections  8.5 and 9.2) to take such other action
under the Operative  Agreements on behalf of the Owner Trustee as the Bank shall
determine  in its  reasonable  discretion  from  time to time.  The Bank  hereby
accepts  such  appointments.  Further,  the Bank shall be  entitled to take such
action on behalf of the Owner  Trustee  as is  delegated  to the Bank  under any
Operative Agreement (whether express or implied) as may be reasonably incidental
thereto.  The parties  hereto hereby agree to the  provisions  contained in this
Section 8.6.

         8.7      Collection and Allocation of Payments and Other Amounts.

                  (a) Each Credit  Party has agreed  pursuant to Section 5.8 and
         otherwise in accordance  with the terms of this Agreement to pay to (i)
         the Bank any and all Rent (excluding Excepted Payments) and any and all
         other amounts of any kind or type under any of the Operative Agreements
         due and  owing or  payable  to any  Person  and  (ii)  each  Person  as
         appropriate the Excepted Payments.

                                       25

<PAGE>


                  (b) Payments and other amounts  received by the Bank from time
         to time in  accordance  with the  terms of  subparagraph  (a)  shall be
         applied and allocated by the Bank first,  to the payment of interest on
         the Loans and  thereafter  the  principal of the Loans which is due and
         payable on such date;  second,  to the payment of accrued  Holder Yield
         with respect to the Holder  Advances and  thereafter the portion of the
         Holder  Advances which is due on such date; and third, if no Default or
         Event of Default is in effect,  any excess shall be paid to such Person
         or Persons as the Lessee may designate.

                  (c) Upon the termination of the Commitments and the payment in
         full of the  Loans  and all other  amounts  owing by the Owner  Trustee
         hereunder  or under any Credit  Document and the payment in full of all
         amounts  owing to the  Holder  and the  Owner  Trustee  under the Trust
         Agreement,  any moneys remaining with the Bank shall be returned to the
         Lessee or such other Person or Persons as the Lessee may designate.  In
         the  event  of  an  Acceleration  it  is  agreed  that,  prior  to  the
         application and allocation of amounts received by the Bank in the order
         described in Section  8.7(b)  above,  any such  amounts  shall first be
         applied and  allocated to the payment of (i) any and all sums  advanced
         by the Bank in order to preserve the Collateral or to preserve its Lien
         thereon, (ii) the expenses of retaking,  holding, preparing for sale or
         lease,  selling or otherwise  disposing or realizing on the Collateral,
         or of any  exercise  by the  Bank  of its  rights  under  the  Security
         Documents,  together with  reasonable  attorneys' fees and expenses and
         court costs and (iii) any and all other amounts  reasonably owed to the
         Bank under or in connection with the  transactions  contemplated by the
         Operative  Agreements  (including  without  limitation  any accrued and
         unpaid administration fees).

         8.8      Release of Properties, etc.

         If the Lessee shall at any time  purchase any Property  pursuant to the
Lease,  or the  Construction  Agent shall purchase any Property  pursuant to the
Agency  Agreement,  or if any Property shall be sold in accordance  with Article
XXII  of the  Lease,  then,  upon  satisfaction  by  the  Owner  Trustee  of its
obligation to prepay the Loans,  Holder  Advances and all other amounts owing to
the Bank under the Operative Agreements,  the Bank shall release such Properties
from the Liens  created by the Security  Documents to the extent of its interest
therein.  In addition,  upon the  termination of the  Commitments and the Holder
Commitments  and the payment in full of the Loans,  the Holder  Advances and all
other amounts  owing by the Owner Trustee and the Lessee  hereunder or under any
other Operative Agreement, the Bank shall release all of the Properties from the
Liens created by the Security  Documents to the extent of its interest  therein.
Upon request of the Owner Trustee following any such release, the Bank shall, at
the sole cost and  expense  of the  Lessee,  execute  and  deliver  to the Owner
Trustee and the Lessee such  documents as the Owner  Trustee or the Lessee shall
reasonably request to evidence such release.

                                       26

<PAGE>


                SECTION 9. CREDIT AGREEMENT AND TRUST AGREEMENT.

         9.1    The Construction Agents and the Lessees Credit Agreement Rights.

         Notwithstanding  anything  to the  contrary  contained  in  the  Credit
Agreement, the Bank, the Credit Parties and the Owner Trustee hereby agree that,
prior to the occurrence and continuation of any Default or Event of Default, the
Construction  Agent or the Lessee,  as the case may be, shall have the following
rights:

                  (a) the right to designate an account to which amounts  funded
         under the Operative  Agreements  shall be credited  pursuant to Section
         2.3(a) of the Credit Agreement;

                  (b) the right to terminate or reduce the Commitments  pursuant
         to Section 2.5(a) of the Credit Agreement;

                  (c) the right to  exercise  the  conversion  and  continuation
         options pursuant to Section 2.7 of the Credit Agreement;

                  (d) the right to receive  any notice and any  certificate,  in
         each case issued pursuant to Section 2.11(a) of the Credit Agreement;

                  (e) the  right to  consent  to any  assignment  by the Bank to
         which the Lessor has the right to consent  pursuant  to Section  9.8 of
         the Credit Agreement.

         9.2     The Construction Agents and the Lessees Trust Agreement Rights.

         Notwithstanding  anything  to  the  contrary  contained  in  the  Trust
Agreement, the Credit Parties, the Owner Trustee and the Bank hereby agree that,
prior to the occurrence and continuation of any Default or Event of Default, the
Construction  Agent or the Lessee,  as the case may be, shall have the following
rights:

                  (a) the  right  to  exercise  the conversion and  continuation
         options  pursuant to Section 3.8 of the Trust Agreement;

                  (b) the right to receive  any notice and any  certificate,  in
         each case issued pursuant to Section 3.9(a) of the Trust Agreement;

                  (c) the right to exercise  the removal  options  contained  in
         Section 9.1 of the Trust Agreement;  provided, however, that no removal
         of the Owner Trustee and  appointment  of a successor  Owner Trustee by
         the Holder pursuant to Section 9.1 of the Trust Agreement shall be made
         without the prior written consent (not to be  unreasonably  withheld or
         delayed) of the Lessee.

                                       27

<PAGE>

                        SECTION 10. TRANSFER OF INTEREST.

         10.1     Restrictions on Transfer.

         The Bank may assign or transfer all of its interest hereunder and under
the other  Operative  Agreements  in  accordance  with Section 9.8 of the Credit
Agreement.  The Bank may,  directly or indirectly,  assign,  convey or otherwise
transfer  all of its right,  title or interest in or to the Trust  Estate or the
Trust  Agreement  with the prior written  consent of the Lessee  (which  consent
shall not be unreasonably  withheld or delayed) and in accordance with the terms
of Section 11.8(b) of the Trust Agreement. The Owner Trustee may, subject to the
rights of the Lessee under the Lease and the other  Operative  Agreements and to
the Lien of the  applicable  Security  Documents but only with the prior written
consent  of the Bank  (which  consent  may be  withheld  by the Bank in its sole
discretion)  and  (provided,  no Default or Event of Default has occurred and is
continuing)  with the consent of the Lessee,  directly  or  indirectly,  assign,
convey,  appoint an agent with respect to enforcement of, or otherwise  transfer
any of its right, title or interest in or to any Property,  the Lease, the Trust
Agreement and the other Operative  Agreements  (including without limitation any
right to  indemnification  thereunder),  or any  other  document  relating  to a
Property or any  interest in a Property as provided in the Trust  Agreement  and
the Lease. The provisions of the immediately  preceding sentence shall not apply
to the obligations of the Owner Trustee to transfer  Property to the Lessee or a
third party  purchaser  pursuant to Article  XXII of the Lease upon  payment for
such  Property in  accordance  with the terms and  conditions  of the Lease.  No
Credit  Party  may  assign  any  of the  Operative  Agreements  or any of  their
respective  rights or obligations  thereunder or with respect to any Property in
whole or in part to any Person without the prior written consent of the Bank and
the Lessor.

         10.2     Effect of Transfer.

         From and after any transfer  effected in  accordance  with this Section
10, the transferor shall be released,  to the extent of such transfer,  from its
liability  hereunder  and under the  other  documents  to which it is a party in
respect of  obligations  to be performed on or after the date of such  transfer;
provided,  however,  that any transferor shall remain liable hereunder and under
such other  documents to the extent that the  transferee  shall not have assumed
the  obligations  of the transferor  thereunder.  Upon any transfer by the Owner
Trustee or the Bank as above  provided,  any such  transferee  shall  assume the
obligations   of  the  Owner   Trustee  or  the  Bank,   as  the  case  may  be.
Notwithstanding any transfer of all or a portion of the transferor's interest as
provided in this  Section 10, the  transferor  shall be entitled to all benefits
accrued  and  all  rights  vested  prior  to  such  transfer  including  without
limitation rights to indemnification under any such document.

                          SECTION 11. INDEMNIFICATION.

         11.1     General Indemnity.

         Whether or not any of the  transactions  contemplated  hereby  shall be
consummated,  the Indemnity  Provider hereby assumes liability for and agrees to
defend,  indemnify  and hold

                                       28

<PAGE>


harmless  each  Indemnified  Person on an After Tax Basis from and  against  any
Claims,  which may be imposed on, incurred by or asserted against an Indemnified
Person by any third party,  including without limitation Claims arising from the
negligence  of an  Indemnified  Person (but not to the extent such Claims  arise
from the gross negligence or willful  misconduct of such Indemnified  Person) in
any way  relating  to or  arising  or  alleged  to arise  out of the  execution,
delivery,  performance or enforcement of this Agreement,  the Lease or any other
Operative  Agreement  or on or with  respect to any  Property  or any  component
thereof,  including without  limitation Claims in any way relating to or arising
or alleged to arise out of (a) the financing, refinancing, purchase, acceptance,
rejection,   ownership,   design,  construction,   refurbishment,   development,
delivery,  acceptance,   nondelivery,  leasing,  subleasing,   possession,  use,
occupancy,  operation,   maintenance,   repair,  modification,   transportation,
condition,  sale,  return,  repossession  (whether  by  summary  proceedings  or
otherwise),  or any  other  disposition  of any  Property  or any part  thereof,
including  without  limitation  the  acquisition,  holding or disposition of any
interest  in the  Property,  lease or  agreement  comprising  a  portion  of any
thereof;  (b) any latent or other defects in any Property or any portion thereof
whether or not discoverable by an Indemnified Person or the Indemnity  Provider;
(c) a violation of Environmental Laws,  Environmental Claims or other loss of or
damage to any property or the environment  relating to the Property,  the Lease,
the Agency Agreement or the Indemnity Provider; (d) the Operative Agreements, or
any transaction  contemplated  thereby; (e) any breach by the Indemnity Provider
of any of its  representations  or warranties under the Operative  Agreements to
which the Indemnity  Provider is a party or failure by the Indemnity Provider to
perform or observe any  covenant or agreement to be performed by it under any of
the Operative  Agreements;  (f) the transactions  contemplated  hereby or by any
other  Operative  Agreement,  in respect of the  application of Parts 4 and 5 of
Subtitle B of Title I of ERISA; (g) personal  injury,  death or property damage,
including  without  limitation  Claims based on strict or absolute  liability in
tort; and (h) any fees,  expenses and/or other  assessments by any business park
or any other applicable entity with oversight  responsibility for the applicable
Property. The Indemnity Provider shall be permitted to contest or respond to any
Claim  subject  to this  Section  11.1 with the  prior  written  consent  of the
Indemnified Person, which consent shall not be unreasonably withheld or delayed.

         11.2     General Tax Indemnity.

                  (a) The Indemnity Provider shall pay and assume liability for,
         and does hereby agree to  indemnify,  protect and defend each  Property
         and all  Indemnified  Persons,  and hold  them  harmless  against,  all
         Impositions  on an After Tax Basis,  and all  payments  pursuant to the
         Operative  Agreements  shall  be made  free and  clear  of and  without
         deduction for any and all present and future Impositions.

                  (b)  Notwithstanding  anything  to  the  contrary  in  Section
         11.2(a)  hereof,  the  following  shall be excluded  from the indemnity
         required by Section 11.2(a):

                           (i) Taxes  (other  than Taxes that are, or are in the
                  nature of,  sales,  use,  rental,  value  added,  transfer  or
                  property  taxes)  that are  imposed on an  Indemnified  Person
                  (other  than the Lessor,  the Owner  Trustee and the Trust) by
                  the  United  States  federal  government  that are based on or
                  measured by the net income

                                       29

<PAGE>


                  (including without limitation taxes based on capital gains and
                  minimum taxes) of such Person; provided, that this  clause (i)
                  shall not be interpreted to prevent a payment from being  made
                  on an After Tax Basis if such payment is otherwise required to
                  be so made;

                           (ii) Taxes  (other than Taxes that are, or are in the
                  nature of,  sales,  use,  rental,  value  added,  transfer  or
                  property  taxes)  that are imposed on any  Indemnified  Person
                  (other  than the Lessor,  the Owner  Trustee and the Trust) by
                  any state or local jurisdiction or taxing authority within any
                  state  or  local  jurisdiction  and  that  are  based  upon or
                  measured by the net income (including without limitation taxes
                  based on  capital  gains and  minimum  taxes) of such  Person;
                  provided  that such  Taxes  shall not be  excluded  under this
                  subparagraph  (ii) to the extent  such  Taxes  would have been
                  imposed had the  location,  possession  or use of any Property
                  in, the  location  or the  operation  of the Lessee in, or the
                  Lessee's making payments under the Operative  Agreements from,
                  the jurisdiction  imposing such Taxes been the sole connection
                  between such Indemnified Person and the jurisdiction  imposing
                  such Taxes; provided, further, that this clause (ii) shall not
                  be  interpreted  to  prevent a payment  from  being made on an
                  After Tax Basis if such payment is otherwise required to be so
                  made;

                           (iii) any Tax to the  extent it  relates  to any act,
                  event or omission  that occurs  after the  termination  of the
                  Lease and  redelivery  or sale of the  Property in  accordance
                  with the terms of the Lease  (but not any Tax that  relates to
                  such  termination,  redelivery  or sale  and/or to any  period
                  prior to such termination, redelivery or sale); and

                           (iv) any Taxes  which are  imposed on an  Indemnified
                  Person  as  a  result  of  the  gross  negligence  or  willful
                  misconduct of such Indemnified  Person,  but not Taxes imposed
                  as a result of ordinary negligence of such Indemnified Person;

                  (c)  Subject to the terms of Section  11.2(f),  the  Indemnity
                  Provider  shall  pay  or  cause  to be  paid  all  Impositions
                  directly  to  the  taxing   authorities   where  feasible  and
                  otherwise to the Indemnified  Person, as appropriate,  and the
                  Indemnity  Provider  shall  at  its  own  expense,  upon  such
                  Indemnified  Person's  reasonable  request,  furnish  to  such
                  Indemnified  Person  copies  of  official  receipts  or  other
                  satisfactory proof evidencing such payment.

                  (d) The Indemnity  Provider shall be responsible for preparing
         and filing any real and personal  property or ad valorem tax returns in
         respect of each  Property  and any other tax returns  required  for the
         Owner Trustee  respecting the  transactions  described in the Operative
         Agreements. In case any other report or tax return shall be required to
         be made with respect to any obligations of the Indemnity Provider under
         or arising out of subsection  (a) and of which the  Indemnity  Provider
         has knowledge or should have knowledge,  the Indemnity Provider, at its
         sole cost and expense,  shall notify the relevant Indemnified Person of
         such  requirement and (except if such  Indemnified  Person notifies

                                       30

         the Indemnity  Provider that such Indemnified Person intends to prepare
         and file such report or return) (A) to the extent required or permitted
         by  and  consistent  with  Legal  Requirements,  make  and  file in the
         Indemnity Provider's name such return, statement or report;  and (B) in
         the case of any other such return, statement  or report  required to be
         made in the name of such  Indemnified  Person,  advise such Indemnified
         Person of such fact and prepare  such  return,  statement or report for
         filing by such Indemnified Person or, where such  return,  statement or
         report shall be required to reflect items in addition to any obligation
         of the Indemnity  Provider  under  or  arising out   of subsection (a),
         provide  such  Indemnified  Person  at the Indemnity Provider's expense
         with information sufficient to permit such return, statement  or report
         to be properly made  with  respect to any  obligations of the Indemnity
         Provider  under  or  arising  out of  subsection  (a). Such Indemnified
         Person shall,upon the Indemnity Provider's request and at the Indemnity
         Provider's  expense,  provide  any data maintained by such  Indemnified
         Person (and not  otherwise  available  to or within the control  of the
         Indemnity Provider)  with respect to each Property  which the Indemnity
         Provider  may reasonably require to prepare any required tax returns or
         reports.

                  (e) As between the  Indemnity  Provider  on one hand,  and the
         Bank on the other hand,  the Indemnity  Provider  shall be  responsible
         for, and the Indemnity  Provider shall  indemnify and hold harmless the
         Bank (without duplication of any indemnification required by subsection
         (a)) on an After Tax Basis against, any obligation for United States or
         foreign withholding taxes or similar levies,  imposts,  charges,  fees,
         deductions or withholdings  (collectively,  "Withholdings")  imposed in
         respect of the interest  payable on the Notes,  Holder Yield payable on
         the  Certificates  or with  respect  to any  other  payments  under the
         Operative  Agreement  (all such  payments  being  referred to herein as
         "Exempt Payments" to be made without deduction, withholding or set off)
         and,  if the Bank  receives a demand for such  payment  from any taxing
         authority or a  Withholding  is otherwise  required with respect to any
         Exempt Payment,  the Indemnity  Provider shall discharge such demand on
         behalf of the Bank.

                  If the Bank or any of its Affiliates  files a consolidated tax
         return (or  equivalent)  and  subsequently  receives the benefit in any
         country of a tax credit or an allowance  resulting from U.S. Taxes with
         respect  to which it has  received a payment  of an  additional  amount
         under this Section 11.2(e), the Bank will pay to the Indemnity Provider
         such part of that  benefit as in the  opinion of the Bank will leave it
         (after such payment) in a position no more and no less  favorable  than
         it would have been in if no additional  payment had been required to be
         paid,  provided  always that (i) the Bank will be the sole judge of the
         amount  of any such  benefit  and of the date on which it is  received,
         (ii) the Bank will  have the  absolute  discretion  as to the order and
         manner  in which it  employs  or  claims  tax  credits  and  allowances
         available  to it and (iii) the Bank will not be obliged to  disclose to
         the  Borrower  any  information   regarding  its  tax  affairs  or  tax
         computations.  For the purposes of this Section 11.2(e),  "U.S.  Taxes"
         shall mean any present or future  tax,  assessment  or other  charge or
         levy  imposed  by or on behalf of the  United  States of America or any
         taxing authority thereof or therein.

                                       31

<PAGE>

                  (f) If a written Claim is made against any Indemnified  Person
         or if any proceeding shall be commenced against such Indemnified Person
         (including without limitation a written notice of such proceeding), for
         any Impositions,  the Indemnity  Provider shall be permitted to contest
         such Claim with the written  consent of the Indemnified  Person,  which
         consent  shall  not be  unreasonably  withheld  or  delayed;  provided,
         however,  that the Indemnity  Provider  shall have the right to conduct
         and control such contest only if such contest involves a Tax other than
         a Tax on net  income  of the  Indemnified  Person  and  can be  pursued
         independently  from any other  proceeding  involving a Tax liability of
         such Indemnified Person.

                  11.3     Increased Costs, Illegality, etc.

                  (a) If, due to either (i) the introduction of or any change in
         or in  the  interpretation  of  any  law  or  regulation  or  (ii)  the
         compliance with any guideline or request hereafter adopted, promulgated
         or made by any central bank or other governmental authority (whether or
         not having the force of law),  there shall be any  increase in the cost
         to the Bank of  agreeing  to make or  making,  funding  or  maintaining
         Advances,  then the Lessee shall from time to time,  upon demand by the
         Bank, pay to the Bank additional  amounts  sufficient to compensate the
         Bank for such  increased  cost. A certificate  as to the amount of such
         increased  cost,  submitted  to  the  Lessee  by  the  Bank,  shall  be
         conclusive and binding for all purposes, absent manifest error.

                  (b) If the Bank  determines  that  compliance  with any law or
         regulation  or any  guideline or request from any central bank or other
         governmental  authority (whether or not having the force of law, but in
         each case  promulgated or made after the date hereof)  affects or would
         affect the amount of capital  required or expected to be  maintained by
         the Bank or any corporation controlling the Bank and that the amount of
         such capital is increased by or based upon the  existence of the Bank's
         commitment to make Advances and other  commitments of this type or upon
         the Advances,  then,  upon demand by the Bank,  the Lessee shall pay to
         the  Bank,  from  time to time as  specified  by the  Bank,  additional
         amounts  sufficient to compensate  the Bank or such  corporation in the
         light of such  circumstances,  to the extent  that the Bank  reasonably
         determines such increase in capital to be allocable to the existence of
         the Bank's  commitment to make such Advances.  A certificate as to such
         amounts  submitted  to the Lessee by the Bank shall be  conclusive  and
         binding for all purposes, absent manifest error.

                  (c) Without  limiting the effect of the foregoing,  the Lessee
         shall pay to the Bank on the last day of the Interest  Period  therefor
         so  long  as  such it is  maintaining  reserves  against  "Eurocurrency
         liabilities" under Regulation D an additional amount (determined by the
         Bank) equal to the product of the following for each Eurodollar Loan or
         Eurodollar Holder Advance, as the case may be, for each day during such
         Interest Period:

                           (i)   the principal amount of such Eurodollar Loan or
                  Eurodollar  Holder Advance, as the case may be, outstanding on
                  such day; and

                                       32

<PAGE>

                           (ii) the remainder of (x) a fraction the numerator of
                  which is the rate  (expressed as a decimal) at which  interest
                  accrues on such Eurodollar Loan or Eurodollar  Holder Advance,
                  as the case may be, for such  Interest  Period as  provided in
                  the Credit Agreement or the Trust  Agreement,  as the case may
                  be (less the Applicable  Percentage),  and the  denominator of
                  which is one (1)  minus the  effective  rate  (expressed  as a
                  decimal)  at which such  reserve  requirements  are imposed on
                  such Financing Party on such day minus (y) such numerator; and

                           (iii) 1/360.

                  (d)  Without  affecting  its rights  under  Sections  11.3(a),
         11.3(b) or 11.3(c) or any other  provision of any Operative  Agreement,
         the  Bank  agrees  that if  there  is any  increase  in any  cost to or
         reduction  in any amount  receivable  by the Bank with respect to which
         the Lessee  would be  obligated  to  compensate  the Bank  pursuant  to
         Sections 11.3(a) or 11.3(b),  the Bank shall use reasonable  efforts to
         select an alternative office for Advances which would not result in any
         such  increase in any cost to or reduction in any amount  receivable by
         the Bank;  provided,  however,  that the Bank shall not be obligated to
         select an alternative  office for Advances if the Bank  determines that
         (i) as a result of such  selection  such the Bank would be in violation
         of any applicable law, regulation, treaty, or guideline, or would incur
         additional   costs  or  expenses  or  (ii)  such  selection   would  be
         inadvisable for regulatory reasons or materially  inconsistent with the
         interests of the Bank.

                  (e) With reference to the  obligations of the Lessee set forth
         in Sections  11.3(a)  through  11.3(d),  the Lessee  shall not have any
         obligation to pay to the Bank amounts owing under such Sections for any
         period which is more than one (1) year prior to the date upon which the
         request for payment therefor is delivered to the Lessee.

                  (f) Notwithstanding any other provision of this Agreement,  if
         the  introduction of or any change in or in the  interpretation  of any
         law or  regulation  makes it  unlawful,  or any  central  bank or other
         governmental  authority  asserts that it is  unlawful,  for the Bank to
         perform its obligations  hereunder to make or maintain Eurodollar Loans
         or  Eurodollar  Holder  Advances,  as the  case  may be,  then (i) each
         Eurodollar Loan or Eurodollar Holder Advance,  as the case may be, will
         automatically,  at the  earlier of the end of the  Interest  Period for
         such Eurodollar Loan or Eurodollar Holder Advance,  as the case may be,
         or the date required by law,  convert into an ABR Loan or an ABR Holder
         Advance,  as the case may be, and (iii) the  obligation  of the Bank to
         make,  convert  or  continue  Eurodollar  Loans  or  Eurodollar  Holder
         Advances,  as the case may be, shall be suspended until the Agent shall
         notify the Lessee that the Bank has determined  that the  circumstances
         causing such suspension no longer exist.

                                       33

<PAGE>


         11.4     Funding/Contribution Indemnity.

         Subject to the  provisions of Section  2.11(a) of the Credit  Agreement
and 3.9(a) of the Trust  Agreement,  as the case may be,  the  Lessee  agrees to
indemnify  the Bank and to hold the Bank  harmless  from any loss or  reasonable
expense which such Financing  Party may sustain or incur as a consequence of (a)
any default in  connection  with the drawing of funds for any  Advance,  (b) any
default  in making  any  prepayment  after a notice  thereof  has been  given in
accordance with the provisions of the Operative  Agreements or (c) the making of
a voluntary or  involuntary  payment of Eurodollar  Loans or  Eurodollar  Holder
Advances,  as the case may be, on a day which is not the last day of an Interest
Period with respect thereto. Such indemnification shall be in an amount equal to
the excess,  if any, of (x) the amount of interest or Holder Yield,  as the case
may be,  which  would have  accrued on the amount so paid,  or not so  borrowed,
accepted, converted or continued for the period from the date of such payment or
of such failure to borrow,  accept,  convert or continue to the last day of such
Interest  Period  (or,  in the case of a failure to borrow,  accept,  convert or
continue,  the  Interest  Period that would have  commenced  on the date of such
failure)  in each case at the  applicable  Eurodollar  Rate plus the  Applicable
Percentage  for such  Loan or  Holder  Advance,  as the  case  may be,  for such
Interest  Period over (y) the amount of interest (as  determined  by the Bank in
its reasonable  discretion)  which would have accrued to the Bank on such amount
by (i) (in the case of Loans)  reemploying  such funds in loans of the same type
and amount  during  the period  from the date of payment or failure to borrow to
the  last day of the  then  applicable  Interest  Period  (or,  in the case of a
failure to borrow,  the Interest Period that would have commenced on the date of
such failure) and (ii) (in the case of Holder  Advances)  placing such amount on
deposit for a comparable period with leading banks in the relevant interest rate
market. This covenant shall survive the termination of the Operative  Agreements
and the payment of all other amounts payable hereunder.

         11.5     Additional Provisions Regarding Indemnification.

         Notwithstanding  the  provisions of Sections  11.1,  11.2 and 11.4, the
Owner  Trustee  shall be the only  beneficiary  of the  provisions  set forth in
Sections 11.1, 11.2 and 11.4 with respect to each Property solely for the period
prior to the earlier to occur of the applicable  Completion Date or Construction
Period Termination Date for such Property,  as applicable.  After the earlier to
occur of the applicable  Completion Date or Construction Period Termination Date
for such Property, as applicable, each Indemnified Person shall be a beneficiary
of the provisions set forth in Sections 11.1, 11.2 and 11.4.

         To the extent the Indemnity Provider is not obligated to indemnify each
Indemnified Person with respect to the various matters described in this Section
11.5,  the  Owner  Trustee  shall  provide  such  indemnities  in  favor of each
Indemnified  Person in  accordance  with the  provisions  of this Section  11.5.
Whether or not any of the transactions contemplated hereby shall be consummated,
the Owner Trustee hereby assumes  liability for and agrees to defend,  indemnify
and hold harmless each Indemnified Person on an After Tax Basis from and against
any  Claims,  which may be  imposed  on,  incurred  by or  asserted  against  an
Indemnified  Person by any third  party,  including  without  limitation  Claims
arising from the negligence of an  Indemnified  Person in any way relating to or
arising or  alleged  to arise out of the  execution,  delivery,  performance  or

                                       34

<PAGE>


enforcement of this Agreement,  the Lease or any other Operative Agreement or on
or with respect to any Property or any component thereof.

         The Owner Trustee shall pay and assume  liability  for, and does hereby
agree to  indemnify,  protect  and  defend  each  Property  and all  Indemnified
Persons,  and hold them harmless against, all Impositions on an After Tax Basis,
and all payments  pursuant to the  Operative  Agreements  shall be made free and
clear of and without  deduction for any and all present and future  Impositions.
Notwithstanding  anything to the contrary in this paragraph,  the Excluded Taxes
shall be excluded from the indemnity provisions afforded by this paragraph.

         THE INDEMNITY  OBLIGATIONS UNDERTAKEN BY THE OWNER TRUSTEE PURSUANT TO
THIS SECTION 11.5 ARE IN ALL RESPECTS  SUBJECT TO THE  LIMITATIONS ON LIABILITY
REFERENCED IN SECTION 12.9.


                           SECTION 12. MISCELLANEOUS.

         12.1     Survival of Agreements.

         The representations,  warranties, covenants, indemnities and agreements
of the  parties  provided  for in the  Operative  Agreements,  and the  parties'
obligations under any and all thereof,  shall survive the execution and delivery
of this  Agreement,  the  transfer  of any  Property to the Owner  Trustee,  the
acquisition of any Property (or any of its components),  the construction of any
Improvements, the Completion of any Property, any disposition of any interest of
the Owner  Trustee  in any  Property  or any  interest  of the Bank in the Trust
Estate,  the payment of the Notes and any  disposition  thereof and shall be and
continue in effect  notwithstanding  any investigation made by any party and the
fact that any party may waive compliance with any of the other terms, provisions
or conditions of any of the Operative Agreements.  Except as otherwise expressly
set forth  herein  or in other  Operative  Agreements,  the  indemnities  of the
parties provided for in the Operative Agreements shall survive the expiration or
termination of any thereof.

         12.2     Notices.

         All notices  required  or  permitted  to be given  under any  Operative
Agreement shall be in writing.  Notices may be served by certified or registered
mail, postage paid with return receipt requested;  by private courier,  prepaid;
by telex, facsimile,  or other telecommunication  device capable of transmitting
or creating a written  record;  or  personally.  Mailed  notices shall be deemed
delivered five (5) days after mailing,  properly  addressed.  Couriered  notices
shall be deemed  delivered  when  delivered as  addressed,  or if the  addressee
refuses  delivery,  when  presented for delivery  notwithstanding  such refusal.
Telex or  telecommunicated  notices  shall be deemed  delivered  when receipt is
either  confirmed by confirming  transmission  equipment or  acknowledged by the
addressee or its office. Personal delivery shall be effective when accomplished.
Unless a party  changes  its  address  by giving  notice  to the other  party as
provided  herein,  notices  shall be delivered  to the parties at the  following
addresses:

                                       35

<PAGE>

                  If to the Construction  Agent or the Lessee, to such entity at
the following address:

                           Dollar Tree Distribution, Inc.
                           500 Volvo Parkway
                           Chesapeake, VA  23320
                           Attention:  Frederick C. Coble
                           Telephone:       (757) 321-5000
                           Telecopy:        (757) 321-5111

                  If to any  Guarantor,  to such entity in care of  Frederick C.
Coble at the following address:

                           Dollar Tree Stores, Inc.
                           500 Volvo Parkway
                           Chesapeake, VA  23320
                           Attention:  Frederick C. Coble
                           Telephone:       (757) 321-5000
                           Telecopy:        (757) 321-5111

                  If to the Owner Trustee, to it at the following address:

                           First Security Bank, National Association
                           79 South Main Street
                           Salt Lake City, Utah 84111
                           Attention:    Val T. Orton,
                                         Vice President
                           Telephone:    (801) 246-5300
                           Telecopy:     (801) 246-5053

                  If to the Bank, to it at the following address:

                           First Union National Bank
                           c/o First Union Capital Markets Group
                           DC 6
                           301 South College Street
                           Charlotte, North Carolina  28288-0166
                           Attention:  Christy Lee Foster,
                           Capital Markets Services
                           Telephone:    (704) 383-5398
                           Telecopy:     (704) 383-7989

                  From time to time any party may designate  additional  parties
         and/or  another  address  for notice  purposes by notice to each of the
         other parties  hereto.  Each notice  hereunder  shall be effective upon
         receipt or refusal thereof.

                                       36
<PAGE>


         12.3     Counterparts.

         This  Agreement  may be  executed  by the  parties  hereto in  separate
counterparts, each of which when so executed and delivered shall be an original,
but all such  counterparts  shall  together  constitute but one (1) and the same
instrument.

         12.4   Terminations, Amendments, Waivers, Etc.; Unanimous Vote Matters.

         Each Basic Document may be terminated, amended, supplemented, waived or
modified only by an instrument in writing  signed by, subject to Article VIII of
the Trust Agreement regarding termination of the Trust Agreement,  the Bank, the
Owner  Trustee and each Credit Party (to the extent such Credit Party is a party
to such Basic Document);  provided, to the extent no Default or Event of Default
shall have  occurred and be  continuing,  the Bank shall not amend,  supplement,
waive or  modify  any  provision  of any Basic  Document  in such a manner as to
adversely  affect the  rights of any  Credit  Party  without  the prior  written
consent (not to be unreasonably  withheld or delayed) of such Credit Party. Each
Operative  Agreement  which is not a Basic Document may be terminated,  amended,
supplemented,  waived or modified only by an instrument in writing signed by the
parties thereto and the Bank.

         12.5     Headings, etc.

         The Table of Contents and headings of the various Articles and Sections
of this  Agreement are for  convenience  of reference only and shall not modify,
define, expand or limit any of the terms or provisions hereof.

         12.6     Parties in Interest.

         Except as expressly  provided  herein,  none of the  provisions of this
Agreement are intended for the benefit of any Person except the parties hereto.

         12.7     GOVERNING LAW; SUBMISSION TO JURISDICTION; WAIVER OF JURY
                  TRIAL; VENUE; ARBITRATION.

                  (a) THIS  AGREEMENT  AND THE  RIGHTS  AND  OBLIGATIONS  OF THE
         PARTIES  HEREUNDER SHALL BE GOVERNED BY AND CONSTRUED,  INTERPRETED AND
         ENFORCED IN  ACCORDANCE  WITH THE LAWS OF THE STATE OF NORTH  CAROLINA.
         Any legal action or  proceeding  with respect to this  Agreement or any
         other Operative  Agreement may be brought in the courts of the State of
         NORTH CAROLINA  located in  MECKLENBURG  County or of the United States
         for the WESTERN  District of NORTH  CAROLINA,  and,  by  execution  and
         delivery  of this  Agreement,  each of the  parties  to this  Agreement
         hereby  irrevocably  accepts for itself and in respect of its property,
         generally and  unconditionally,  the nonexclusive  jurisdiction of such
         courts.  The parties shall serve process in accordance  with applicable
         laws.  Nothing  herein  shall affect the right of any party to commence
         legal  proceedings  or to  otherwise  proceed  against any party in any
         other jurisdiction.

                                       37
<PAGE>


                  (b)   EACH   OF   THE   PARTIES   HERETO    IRREVOCABLY    AND
         UNCONDITIONALLY,  TO THE  FULLEST  EXTENT  ALLOWED BY  APPLICABLE  LAW,
         WAIVES TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING  RELATING TO ANY
         DISPUTE OR THIS AGREEMENT,  ANY OTHER  OPERATIVE  AGREEMENT AND FOR ANY
         COUNTERCLAIM THEREIN.

                  (c) Each of the parties to this Agreement  hereby  irrevocably
         waives any objection  which it may now or hereafter  have to the laying
         of venue of any of the aforesaid actions or proceedings  arising out of
         or in connection with this Agreement or any other  Operative  Agreement
         brought in the courts  referred to in  subsection  (a) above and hereby
         further irrevocably waives and agrees not to plead or claim in any such
         court that any such action or proceeding  brought in any such court has
         been brought in an inconvenient forum.

                  (d)  Notwithstanding  the provisions of Section  12.7(a) or of
any other Operative Agreement to the contrary,  upon demand of any party to this
Agreement and/or any other Operative Agreement, upon demand of any party hereto,
whether made before or after institution of any judicial  proceeding,  any claim
or controversy  arising out of, or relating to the Operative  Agreements between
or among  the  parties  hereto  (a  "Dispute")  shall  be  resolved  by  binding
arbitration  conducted under and governed by the Commercial  Financial  Disputes
Arbitration  Rules  (the  "Arbitration   Rules")  of  the  American  Arbitration
Association  (the "AAA") and the Federal  Arbitration  Act;  provided,  that any
demand for arbitration pursuant to this Section 12.7 shall be made no later than
30 days  after  service of process  in any legal  action or  proceeding  brought
pursuant to Section  12.7(a).  Disputes  may  include  without  limitation  tort
claims,   counterclaims,   disputes  as  to  whether  a  matter  is  subject  to
arbitration,  claims brought as class actions,  or claims arising from documents
executed  in the future.  A judgment  upon the award may be entered in any court
having jurisdiction.  Notwithstanding the foregoing,  this arbitration provision
does not apply to disputes under or related to swap agreements.

         All  arbitration  hearings  shall be conducted in the city in which the
office of the Bank  (referenced  pursuant to Section 12.2 of this  Agreement) is
located. A hearing shall begin within ninety (90) days of demand for arbitration
and all hearings shall be concluded  within one hundred and twenty (120) days of
demand for  arbitration.  These time  limitations  may not be extended  unless a
party shows cause for  extension and then for no more than a total of sixty (60)
days. The expedited  procedures set forth in Rule 51 et seq. of the  Arbitration
Rules shall be applicable to claims of less than $1,000,000.  Arbitrators  shall
be licensed attorneys selected from the Commercial Financial Dispute Arbitration
Panel  of the  AAA.  The  parties  do not  waive  applicable  federal  or  state
substantive law except as provided herein.

         Notwithstanding  the  preceding  binding  arbitration  provisions,  the
parties agree to preserve,  without diminution,  certain remedies that any party
may exercise before or after an arbitration  proceeding is brought.  The parties
shall  have the  right to  proceed  in any court of  proper  jurisdiction  or by
self-help to exercise or prosecute the following  remedies,  as applicable:  (i)
all rights to foreclose  against any real or personal property or other security
by exercising a power of sale or under  applicable  law by judicial  foreclosure
including  a  proceeding  to  confirm

                                       38
<PAGE>


the sale;  (ii) all rights of self-help  including  peaceful  occupation of real
property and  collection of rents,  set-off and peaceful  possession of personal
property; (iii) obtaining provisional or ancillary remedies including injunctive
relief,  sequestration,  garnishment,  attachment,  appointment  of receiver and
filing  an  involuntary  bankruptcy  proceedings;  and (iv) when  applicable,  a
judgment by confession of judgment.  Any claim or controversy with regard to any
party's entitlement to such remedies is a Dispute.

         Each party to this Agreement  agrees that it shall not have a remedy of
punitive or exemplary  damages against any other party in any Dispute and hereby
waives any right or claim to  punitive  or  exemplary  damages  they have now or
which may arise in the  future  in  connection  with any  Dispute,  whether  the
Dispute is resolved by arbitration or judicially.


         12.8     Severability.

         Any provision of this Agreement that is prohibited or  unenforceable in
any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such  prohibition  or  unenforceability   without   invalidating  the  remaining
provisions  hereof,  and  any  such  prohibition  or   unenforceability  in  any
jurisdiction shall not invalidate or render  unenforceable such provision in any
other jurisdiction.

         12.9     Liability Limited.

                  (a) The Bank,  the Credit  Parties and the Owner  Trustee each
         acknowledge  and agree that the Owner  Trustee is (except as  otherwise
         expressly  provided herein or therein) entering into this Agreement and
         the other  Operative  Agreements to which it is a party (other than the
         Trust Agreement and to the extent otherwise  provided in Section 6.1 of
         this  Agreement),  solely in its  capacity  as trustee  under the Trust
         Agreement and not in its individual capacity and that the Trust Company
         shall not be liable or accountable under any  circumstances  whatsoever
         in its  individual  capacity  for  or on  account  of  any  statements,
         representations,  warranties,  covenants  or  obligations  stated to be
         those of the Owner  Trustee,  except  for its own gross  negligence  or
         willful misconduct and as otherwise expressly provided herein or in the
         other Operative Agreements.

                  (b) Anything to the contrary contained in this Agreement,  the
         Credit  Agreement,  the  Notes  or in  any  other  Operative  Agreement
         notwithstanding, no Exculpated Person shall be personally liable in any
         respect for any  liability or  obligation  arising  hereunder or in any
         other Operative  Agreement  including without limitation the payment of
         the  principal of, or interest on, the Notes,  or for monetary  damages
         for the breach of performance of any of the covenants  contained in the
         Credit Agreement,  the Notes, this Agreement, the Security Agreement or
         any of the other  Operative  Agreements.  The Bank agrees that,  in the
         event any remedies under any Operative Agreement are pursued,  the Bank
         shall  have  no  recourse  against  any  Exculpated   Person,  for  any
         deficiency,  loss or Claim for monetary damages or otherwise  resulting
         therefrom and recourse shall be had solely and exclusively  against the
         Trust Estate (excluding

                                       39

<PAGE>


         Excepted Payments) and the Credit Parties (with respect to  the  Credit
         Parties'   obligations  under  the  Operative Agreements);  but nothing
         contained  herein  shall  be taken to prevent  recourse  against or the
         enforcement of  remedies against  the Trust Estate (excluding  Excepted
         Payments)  in  respect  of  any  and  all liabilities,  obligations and
         undertakings  contained herein and/or in any other Operative Agreement.
         Notwithstanding  the  provisions  of  this  Section,   nothing  in  any
         Operative Agreement shall: (i)constitute a waiver, release or discharge
         of any indebtedness or obligation evidenced  by the  Notes  and/or  the
         Certificates  arising  under any  Operative Agreement or secured by any
         Operative  Agreement,  but  the  same  shall  continue  until  paid  or
         discharged;  (ii) relieve any  Exculpated  Person  from  liability  and
         responsibility for (but only to the extent of  the damages  arising  by
         reason of): active waste knowingly  committed by any Exculpated  Person
         with respect to any Property,  any fraud,  gross  negligence or willful
         misconduct  on  the  part  of any  Exculpated Person; (iii) relieve any
         Exculpated  Person from  liability and  responsibility for (but only to
         the extent  of the  moneys  misappropriated,  misapplied  or not turned
         over)  (A)   except   for   Excepted   Payments,   misappropriation  or
         misapplication  by  the  Lessor (i.e., application in a manner contrary
         to any of the  Operative  Agreements)  of  any  insurance  proceeds  or
         condemnation  award paid or delivered to the Lessor by any Person other
         than the Bank,  (B) except for Excepted  Payments,  any deposits or any
         escrows  or amounts  owed by the  Construction  Agent  under the Agency
         Agreement held by the Lessor or (C) except for Excepted  Payments,  any
         rent or other income  received by the Lessor from any Credit Party that
         is not turned over to the Bank;  or (iv) affect or in any way limit the
         Bank's rights and remedies  under any Operative  Agreement with respect
         to the Rents and  rights  and  powers of the Bank  under the  Operative
         Agreements or to obtain a judgment against the Lessee's interest in the
         Properties or the Bank's rights and powers to obtain a judgment against
         the Lessor or any Credit Party (provided,  that no deficiency  judgment
         or other money judgment shall be enforced against any Exculpated Person
         except  to the  extent of the  Lessor's  interest  in the Trust  Estate
         (excluding Excepted Payments) or to the extent the Lessor may be liable
         as  otherwise  contemplated  in clauses  (ii) and (iii) of this Section
         12.9(b)).

         12.10    Rights of the Credit Parties.

         If at any time all  obligations  (i) of the  Owner  Trustee  under  the
Credit Agreement,  the Security Documents and the other Operative Agreements and
(ii) of the Credit Parties under the Operative Agreements have in each case been
satisfied or  discharged in full,  then the Credit  Parties shall be entitled to
(a)  terminate  the Lease and  guaranty  obligations  under  Section  6B and (b)
receive all amounts then held under the  Operative  Agreements  and all proceeds
with respect to any of the  Properties.  Upon the  termination  of the Lease and
Section 6B pursuant to the  foregoing  clause (a), the Lessor shall  transfer to
the Lessee all of its right,  title and  interest  free and clear of the Lien of
the Lease, the Lien of the Security Documents and all Lessor Liens in and to any
Properties then subject to the Lease and any amounts or proceeds  referred to in
the foregoing clause (b) shall be paid over to the Lessee.

                                       40
<PAGE>


         12.11    Further Assurances.

         The  parties  hereto  shall  promptly  cause  to  be  taken,  executed,
acknowledged or delivered,  at the sole expense of the Lessee,  all such further
acts,  conveyances,  documents and assurances as the other parties may from time
to time  reasonably  request in order to carry out and effectuate the intent and
purposes of this Participation Agreement, the other Operative Agreements and the
transactions  contemplated  hereby and thereby (including without limitation the
preparation,  execution  and  filing  of any and  all  Uniform  Commercial  Code
financing  statements,  filings of  Mortgage  Instruments  and other  filings or
registrations which the parties hereto may from time to time request to be filed
or  effected).  The Lessee,  at its own  expense  and without  need of any prior
request  from any  other  party,  shall  take such  action  as may be  necessary
(including without  limitation any action specified in the preceding  sentence),
or (if the Owner Trustee shall so request) as so requested, in order to maintain
and protect all security  interests  provided  for  hereunder or under any other
Operative  Agreement.  In  addition,  in  connection  with  the  sale  or  other
disposition of any Property or any portion thereof, the Lessee agrees to execute
such instruments of conveyance as reasonably required in connection therewith.

         12.12    Calculations under Operative Agreements.

         The  parties   hereto  agree  that  all   calculations   and  numerical
determinations  to be made under the  Operative  Agreements by the Owner Trustee
shall be made by the Bank and that such calculations and determinations shall be
conclusive and binding on the parties hereto in the absence of manifest error.

         12.13    [Intentionally Left Blank].

         12.14    Financial Reporting/Tax Characterization.

         Lessee agrees to obtain advice from its own accountants and tax counsel
regarding the financial reporting treatment and the tax  characterization of the
transactions  described in the Operative Agreements.  Lessee further agrees that
Lessee shall not rely upon any statement of any Financing  Party or any of their
respective Affiliates and/or Subsidiaries regarding any such financial reporting
treatment and/or tax characterization.

                            [signature pages follow]

                                       41
<PAGE>


         IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective  officers  thereunto duly authorized as of the
day and year first above written.


CONSTRUCTION AGENT
AND LESSEE:
                                     DOLLAR TREE DISTRIBUTION, INC.,
                                     a Virginia corporation, as the Construction
                                     Agent and the Lessee


                                     By:/s/ Frederick C. Coble
                                     Name: Frederick C. Coble
                                     Title: Sr. V.P.


GUARANTORS:
                                     DOLLAR TREE STORES, INC.,
                                     a Virginia corporation


                                     By: /s/ Frederick C. Coble
                                     Name: Frederick C. Coble
                                     Title: Sr. V.P.


                                     DOLLAR TREE MANAGEMENT, INC.,
                                     a Virginia corporation


                                     By: /s/ Frederick C. Coble
                                     Name: Frederick C. Coble
                                     Title: Sr. V.P.


                       [Signatures continued on next page]




<PAGE>


OWNER TRUSTEE AND
LESSOR:
                                     FIRST     SECURITY    BANK,
                                     NATIONAL  ASSOCIATION,  not
                                     individually,   except   as
                                     expressly   stated  herein,
                                     but  solely  as  the  Owner
                                     Trustee   under   the  DTSD
                                     Realty Trust 1991-1


                                     By: /s/ Val T. Orton
                                     Name: Val T. Orton
                                     Title: Vice President


                       [Signatures continued on next page]




<PAGE>


BANK:
                                     FIRST UNION NATIONAL BANK, a national
                                     banking association, as Lender and Holder


                                     By: /s/ Eileen McCrickard
                                     Name: Eileen McCrickard
                                     Title: Vice President



                                [Signatures end]



<PAGE>




                                    EXHIBIT A


                                REQUISITION FORM
   (Pursuant to Sections 4.2, 5.2, 5.3 and 5.4 of the Participation Agreement)

         DOLLAR TREE DISTRIBUTION,  INC., a Virginia corporation (the "Company")
hereby  certifies as true and correct and delivers the following  Requisition to
FIRST UNION NATIONAL BANK, as lender and holder ("Bank"):

         Reference is made herein to that certain Participation  Agreement dated
as of June 2,  1999 (as  amended,  modified,  extended,  supplemented,  restated
and/or  replaced from time to time,  the  "Participation  Agreement")  among the
Company,  in its  capacity  as the Lessee  and as the  Construction  Agent,  the
various parties thereto from time to time, as the guarantors (the "Guarantors"),
First Security Bank,  National  Association,  as the Owner Trustee and the Bank.
Capitalized  terms used herein but not otherwise  defined  herein shall have the
meanings set forth therefor in the Participation Agreement.

Check one:

         ____ INITIAL CLOSING DATE: _________________
         (three (3) Business Days prior notice required for Advance)

         ____ PROPERTY CLOSING DATE: _________________
         (three (3) Business Days prior notice required for Advance)

         ____ CONSTRUCTION ADVANCE DATE: _____________
         (three (3) Business Days prior notice required for Advance)

   1.  Transaction  Expenses and other fees,  expenses and  disbursements  under
   Section  7 of the  Participation  Agreement  and any and  all  other  amounts
   contemplated  to be  financed  under the  participation  Agreement  including
   without  limitation any Work,  broker's fees,  taxes,  recording fees and the
   like (with supporting invoices or closing statement attached):

   Party to Whom Amount Owed
   Amount is Owed (in U.S. Dollars)

   -------------    ------------
   -------------    ------------
   -------------    ------------
   -------------    ------------
   -------------    ------------

                                      A-1

<PAGE>


   2.  Description  of Land (which shall be a legal  description  of the Land in
   connection with an Advance to pay Property  Acquisition  Costs): See attached
   Schedule 1

   3.  Description of Improvements:  See attached Schedule 2

   4.  Description of Equipment:  See attached Schedule 3

   5.  Description of Work:  See attached Schedule 4

   6. Aggregate  Loans and Holder  Advances  requested since the Initial Closing
   Date with respect to each  Property for which  Advances are  requested  under
   this Requisition (listed on a Property by Property basis),  including without
   limitation  all amounts  requested  under this  Requisition:  [identify  on a
   Property by Property basis]

                  $______________                              [Property]

         In connection with this  Requisition,  the Company hereby requests that
the Bank make Loans to the Lessor in the amount of $______________  and that the
Bank make Holder Advances to the Lessor in the amount of $________________.  The
Company hereby certifies (i) that the foregoing  amounts requested do not exceed
the total  aggregate of the  Available  Commitments  plus the  Available  Holder
Commitments  and (ii)  each of the  provisions  of the  Participation  Agreement
applicable  to the Loans  and  Holder  Advances  requested  hereunder  have been
complied with as of the date of this Requisition.

         The Company requests the Loans be allocated as follows:

                  $______________                    ABR Loans

                  $______________                    Eurodollar Loans

         The Company requests the Holder Advances be allocated as follows:

                  $______________                    ABR Holder Advances

                  $______________                    Eurodollar Holder Advances


                                      A-2

<PAGE>


         The  Company has caused this  Requisition  to the  executed by its duly
authorized officer as of this _____ day of __________, ______.


                                     DOLLAR TREE DISTRIBUTION, INC.


                                     By:
                                     Name:
                                     Title:



                                      A-3
<PAGE>


                                   Schedule 1

                               Description of Land
                     (Legal Description and Street Address)


                                      A-4
<PAGE>


                                   Schedule 2

                           Description of Improvements


                                      A-5
<PAGE>


                                   Schedule 3

                            Description of Equipment
                               General Description


                                      A-6
<PAGE>


                                   Schedule 4

                                      Work
               Work Performed for which the Advance is requested:

                                      A-7
<PAGE>


                                    EXHIBIT B


                    [Outside Counsel Opinion for the Lessee]
                       (Pursuant to Section 5.3(j) of the
                            Participation Agreement)


TO THOSE ON THE ATTACHED DISTRIBUTION LIST

         Re:  Synthetic Lease Financing Provided in favor of Dollar Tree
              Distribution, Inc.

Dear Sirs:

We have acted as special counsel to Dollar Tree  Distribution,  Inc., a Virginia
corporation (the "Lessee") and the various parties thereto from time to time, as
guarantors  (individually,  a "Guarantor" and  collectively,  the  "Guarantors";
individually,  Lessee and each  Guarantor may be referred to herein as a "Credit
Party" or  collectively,  as the "Credit  Parties"),  in connection with certain
transactions  contemplated  by the  Participation  Agreement dated as of June 2,
1999 (the  "Participation  Agreement"),  among the Lessee,  First Security Bank,
National  Association,  as the Owner  Trustee (the "Owner  Trustee"),  and First
Union  National  Bank,  as lender and holder  ("First  Union" or  "Bank").  This
opinion is delivered pursuant to Section 5.3(j) of the Participation  Agreement.
All capitalized terms used herein, and not otherwise defined herein,  shall have
the meanings assigned thereto in Appendix A to the Participation Agreement.

In  connection  with  the  foregoing,  we have  examined  originals,  or  copies
certified to our satisfaction, of [identify the applicable Operative Agreements,
including each Mortgage Instrument, related UCC fixture filings, Additional UCCs
(hereinafter  defined),  Deeds and Memoranda of Lease] and such other  corporate
documents and records of the Credit Parties,  certificates  of public  officials
and  representatives  of the Credit Parties as to certain factual  matters,  and
such other instruments and documents which we have deemed necessary or advisable
to examine for the purpose of this opinion. With respect to such examination, we
have assumed (i) the statements of fact made in all such certificates, documents
and instruments  are true,  accurate and complete;  (ii) the due  authorization,
execution and delivery of the Operative Agreements by the parties thereto; (iii)
the  genuineness of all signatures,  the  authenticity  and  completeness of all
documents, certificates, instruments, records and corporate records submitted to
us as originals and the conformity to the original  instruments of all documents
submitted  to us as  copies,  and  the  authenticity  and  completeness  of  the
originals of such copies;  (iv) that all parties  have all  requisite  corporate
power and authority to execute,  deliver and perform the  Operative  Agreements;
and (v) except as to the Credit  Parties,  the  enforceability  of the  Mortgage
Instrument, the Memorandum of Lease and the UCC financing statements against all
parties thereto.

                                      B-1

<PAGE>


Based on the foregoing,  and having due regard for such legal  considerations as
we deem  relevant,  and subject to the  limitations  and  assumptions  set forth
herein,  including without  limitation the matters set forth in the last two (2)
paragraphs hereof, we are of the opinion that:

         (a) The Mortgage  Instrument and Memorandum of Lease are enforceable in
accordance  with their  respective  terms,  except as limited by laws  generally
affecting the enforcement of creditors'  rights,  which laws will not materially
prevent the realization of the benefits intended by such documents.

         (b) Each form of Mortgage  Instrument and UCC fixture  filing  relating
thereto,  attached hereto as Schedules 1 and 2, respectively,  is in proper form
for filing and recording with the offices of [identify the recording  offices of
the  respective  county  clerks where the  Properties  are to be located].  Upon
filing of each  Mortgage  Instrument  and UCC fixture  filing in  [identify  the
recording offices of the respective county clerks where the Properties are to be
located],  Bank will have a valid,  perfected lien and security interest in that
portion of the Collateral  described in such Mortgage  Instrument or UCC fixture
filing to the extent  such  Collateral  is  comprised  of real  property  and/or
fixtures.

         (c) The forms of UCC  financing  statements  relating  to the  Security
Documents,  attached hereto as Schedule 3 (the "Additional UCCs"), are in proper
form for filing and  recording  with the offices of [identify  (i) the recording
offices of the  respective  county clerks where the Properties are to be located
and (ii) the Secretary of State where the  Properties  are to be located].  Upon
filing of the  Additional  UCCs in [identify  (i) the  recording  offices of the
respective  county  clerks where the  Properties  are to be located and (ii) the
Secretary of State where the  Properties  are to be  located],  Bank will have a
valid,  perfected  lien and security  interest in that portion of the Collateral
which can be perfected by filing UCC-1 financing  statements  under Article 9 of
the UCC.

         (d) Each form of Deed and  Memorandum of Lease is in  appropriate  form
for  filing  and  recording  with the  [identify  the  recording  offices of the
respective  county  clerks  for the  counties  where  the  Properties  are to be
located].

         (e)  Each  Memorandum  of  Lease,  when  filed  and  recorded  with the
[identify the recording offices of the respective county clerks for the counties
where the  Properties  are to be located],  will have been filed and recorded in
all public offices in the State of  [__________] in which filing or recording is
necessary to provide  constructive  notice of the Lease to third  Persons and to
establish of record the interest of the Lessor  thereunder as to the  Properties
described in each such Memorandum of Lease.

         (f) Title to the Properties  located in the State of [___________]  may
be held in the name of the  Owner  Trustee  as  follows:  First  Security  Bank,
National  Association,  not individually,  but solely as the Owner Trustee under
the DTSD Realty Trust 1999-1.

                                      B-2

<PAGE>


         (g) The  execution  and  delivery  by  First  Security  Bank,  National
Association,  individually  or as the Owner Trustee,  as the case may be, of the
Operative  Agreements to which it is a party and  compliance  by First  Security
Bank, National  Association,  individually or as the Owner Trustee,  with all of
the  provisions  thereof  do not  and  will  not  contravene  any  law,  rule or
regulation of [identify the state].

         (h) By reason of their  participation  in the transaction  contemplated
under the  Operative  Agreements,  neither Bank nor the Owner Trustee has to (a)
qualify  as a  foreign  corporation  in  [identify  the  state],  (b)  file  any
application or any designation for service of process in [identify the state] or
(c) pay any franchise,  income,  sales, excise, stamp or other taxes of any kind
to [identify the state].

         (i)  The  provisions  in  the  Operative  Agreements  concerning  Rent,
interest, fees, prepayment premiums and other similar charges do not violate the
usury laws or other similar laws  regulating  the use or forbearance of money of
[identify the state].

         (j) If the  transactions  contemplated by the Operative  Agreements are
characterized as a lease transaction by a court of competent  jurisdiction,  the
Lease and the  applicable  Lease  Supplement  shall demise to the Lessee a valid
leasehold interest in the Properties described in such Lease Supplement.

         (k) If the  transactions  contemplated by the Operative  Agreements are
characterized  as a loan transaction by a court of competent  jurisdiction,  the
combination of the Mortgage Instruments, the Deeds, the Lease and the applicable
Lease Supplements (and the other Operative  Agreements  incorporated  therein by
reference) are sufficient to create a valid, perfected lien or security interest
in the Properties therein described,  enforceable as a mortgage in [identify the
state].

This opinion is limited to the matters  stated  herein and no opinion is implied
or may be inferred  beyond the matters stated  herein.  This opinion is based on
and is limited to the laws of the State of [___________] and the federal laws of
the United  States of  America.  Insofar  as the  foregoing  opinion  relates to
matters of law other than the foregoing, no opinion is hereby given.

                                      B-3

<PAGE>


This opinion is for the sole benefit of the Lessee, the Construction  Agent, the
Guarantors,  the Owner Trustee, Bank and their respective successors and assigns
and may not be relied upon by any other person other than such parties and their
respective  successors and assigns  without the express  written  consent of the
undersigned. The opinions expressed herein are as of the date hereof and we make
no  undertaking  to amend  or  supplement  such  opinions  if facts  come to our
attention or changes in the current law of the  jurisdictions  mentioned  herein
occur which could affect such opinions.

                                             Very truly yours,


                           [LESSEE'S OUTSIDE COUNSEL]

                                      B-4
<PAGE>


                                Distribution List



First Union National Bank, as Lender and Holder

Dollar Tree Distribution, Inc., as the Construction Agent and the Lessee

The various  parties to the  Participation  Agreement  from time to time, as the
Guarantors

First Security Bank, National Association,  not individually,  but solely as the
Owner Trustee under the DTSD Real Estate Trust 19991-1



                                      B-5
<PAGE>


                                   Schedule 1

                           Form of Mortgage Instrument


                                      B-6
<PAGE>


                                   Schedule 2

                          Forms of UCC Fixture Filings


                                      B-7
<PAGE>


                                   Schedule 3

                        Forms of UCC Financing Statements




                                      B-8
<PAGE>


                                    EXHIBIT C


                         DOLLAR TREE DISTRIBUTION, INC.

                              OFFICER'S CERTIFICATE
           (Pursuant to Section 5.3(w) of the Participation Agreement)

         DOLLAR TREE DISTRIBUTION, INC., a Virginia corporation (the "Company"),
DOES HEREBY CERTIFY as follows:

         1.       Each and every  representation  and  warranty  of each  Credit
                  Party  contained in the Operative  Agreements to which it is a
                  party is true and correct in every material  respect on and as
                  of the date hereof.

         2.       No Default  or Event of Default has occurred and is continuing
                  under any Operative Agreement.

         3.       Each Operative  Agreement to which any Credit Party is a party
                  is in full force and effect with respect to it.

         4.       Each Credit Party has duly  performed  and  complied  with all
                  covenants,   agreements  and   conditions   contained  in  the
                  Participation   Agreement  (hereinafter  defined)  or  in  any
                  Operative  Agreement required to be performed or complied with
                  by it on or prior to the date hereof.

         Capitalized terms used in this Officer's  Certificate and not otherwise
defined  herein  have  the   respective   meanings   ascribed   thereto  in  the
Participation  Agreement  dated as of June 2,  1999  among the  Company,  as the
Lessee and as the  Construction  Agent, the various parties thereto from time to
time,  as  guarantors  (the   "Guarantors"),   First  Security  Bank,   National
Association,  as the Owner Trustee and First Union  National Bank, as lender and
holder ("Bank").

         IN WITNESS WHEREOF,  the Company has caused this Officer's  Certificate
to be duly executed and delivered as of this _____ day of __________, ______.


                                     DOLLAR TREE DISTRIBUTION, INC.


                                     By:
                                     Name:
                                     Title:


                                      C-1
<PAGE>


                                    EXHIBIT D

                             [NAME OF CREDIT PARTY]


                             SECRETARY'S CERTIFICATE
           (Pursuant to Section 5.3(x) of the Participation Agreement)

         [NAME OF CREDIT PARTY], a ________________  corporation (the "Company")
DOES HEREBY CERTIFY as follows:

         1.       Attached hereto as Schedule 1 is a true,  correct and complete
                  copy of the  resolutions  of the  Board  of  Directors  of the
                  Company  duly adopted by the Board of Directors of the Company
                  on  __________.   Such  resolutions  have  not  been  amended,
                  modified or rescinded  since their date of adoption and remain
                  in full force and effect as of the date hereof.

         2.       Attached hereto as Schedule 2 is a true,  correct and complete
                  copy of the Articles of  Incorporation  of the Company on file
                  in the Office of the Secretary of State of  ___________.  Such
                  Articles of Incorporation  have not been amended,  modified or
                  rescinded  since  their  date of  adoption  and remain in full
                  force and effect as of the date hereof.

         3.       Attached hereto as Schedule 3 is a true,  correct and complete
                  copy of the Bylaws of the  Company.  Such Bylaws have not been
                  amended,  modified or  rescinded  since their date of adoption
                  and remain in full force and effect as of the date hereof.

         4.       The  persons  named  below  now hold  the  offices  set  forth
                  opposite their names, and the signatures  opposite their names
                  and titles are their true and correct signatures.

              Name                    Office                    Signature

       -------------------   -----------------------   -------------------------

       -------------------   -----------------------   -------------------------

IN WITNESS WHEREOF,  the Company has caused this  Secretary's  Certificate to be
duly executed and delivered as of this _____ day of ___________, ______.

                                     [NAME OF CREDIT PARTY]

                                     By:
                                     Name:
                                     Title:

                                      D-1
<PAGE>


                                   Schedule 1

                                Board Resolutions


                                      D-2
<PAGE>


                                   Schedule 2

                            Articles of Incorporation

                                      D-3
<PAGE>


                                   Schedule 3

                                     Bylaws



                                      D-4
<PAGE>


                                    EXHIBIT E


                    FIRST SECURITY BANK, NATIONAL ASSOCIATION

                              OFFICER'S CERTIFICATE
           (Pursuant to Section 5.3(z) of the Participation Agreement)

         FIRST  SECURITY  BANK,   NATIONAL   ASSOCIATION,   a  national  banking
association,  not individually (except with respect to paragraph 1 below, to the
extent  any such  representations  and  warranties  are  made in its  individual
capacity)  but solely as the owner  trustee  under the DTSD Realty  Trust 1999-1
(the "Owner Trustee"), DOES HEREBY CERTIFY as follows:

         1.       Each  and  every  representation  and  warranty  of the  Owner
                  Trustee contained in the Operative Agreements to which it is a
                  party is true and correct on and as of the date hereof.

         2.       Each Operative Agreement to which the Owner Trustee is a party
                  is in full force and effect with respect to it.

         3.       The Owner  Trustee has duly  performed  and complied  with all
                  covenants,   agreements  and   conditions   contained  in  the
                  Participation   Agreement  (hereinafter  defined)  or  in  any
                  Operative  Agreement required to be performed or complied with
                  by it on or prior to the date hereof.

Capitalized  terms used in this Officer's  Certificate and not otherwise defined
herein  have the  respective  meanings  ascribed  thereto  in the  Participation
Agreement dated as of June 2, 1999 among Dollar Tree Distribution,  Inc., as the
Lessee and as the  Construction  Agent, the various parties thereto from time to
time, as  guarantors  (the  "Guarantors"),  the Owner  Trustee,  and First Union
National Bank, as lender and holder ("Bank").

IN WITNESS WHEREOF,  the Owner Trustee has caused this Officer's  Certificate to
be duly executed and delivered as of this _____ day of __________, ______.

                                     FIRST     SECURITY    BANK,
                                     NATIONAL  ASSOCIATION,  not
                                     individually,   except   as
                                     expressly   stated  herein,
                                     but  solely  as  the  Owner
                                     Trustee   under   the  DTSD
                                     Realty Trust 1999-1

                                     By:
                                     Name:
                                     Title:


                                      E-1
<PAGE>


                                    EXHIBIT F


                    FIRST SECURITY BANK, NATIONAL ASSOCIATION

                             SECRETARY'S CERTIFICATE
          (Pursuant to Section 5.3(aa) of the Participation Agreement)

                       CERTIFICATE OF ASSISTANT SECRETARY


         I,   ______________________,   duly  elected  and  qualified  Assistant
Secretary of the Board of Directors of First Security Bank, National Association
(the "Association"), hereby certify as follows:

         1. The Association is a National  Banking  Association  duly organized,
validly existing and in good standing under the laws of the United States.  With
respect thereto the following is noted:

         A. Pursuant to Revised Statutes 324, et seq., as amended, 12 U.S.C.  1,
            et seq.,  the Comptroller  of  the  Currency  charters and exercises
            regulatory  and  supervisory  authority  over  all  National Banking
            Associations;

         B. On  December 9, 1881, the  First  National  Bank of Ogden, Utah  was
            chartered  as a National  Banking Association  under the laws of the
            United States and under Charter No. 2597;

         C. On October 2, 1922, in connection with a consolidation  of The First
            National Bank of Ogden, Ogden,  Utah,  and The Utah National Bank of
            Ogden,  Ogden,  Utah, the  title  was  changed  to "The First & Utah
            National  Bank  of Ogden";  on  January 18, 1923,  The  First & Utah
            National Bank  of Ogden  changed  its  title to "First Utah National
            Bank of Ogden"; on January 19,1926, the title was changed  to "First
            National Bank of Ogden"; on February 24, 1934, the title was changed
            to "First Security Bank of Utah, National Association";  on June 21,
            1996,  the  title was  changed  to  "First  Security  Bank, National
            Association"; and

         D. First Security Bank, National Association, Ogden, Utah, continues to
            hold a valid  certificate  to  do  business  as  a  National Banking
            Association.

         2. The Association's  Articles of Association,  as amended, are in full
force and effect,  and a true,  correct and complete copy is attached  hereto as
Schedule A and incorporated herein by reference. Said Articles were last amended
October 20, 1975, as required by law on notice at a duly called special  meeting
of the shareholders of the Association.

                                      F-1

<PAGE>


         3. The Association's By-Laws, as amended, are in full force and effect;
and a true,  correct  and  complete  copy is  attached  hereto as Schedule B and
incorporated herein by reference.  Said By-Laws, still in full force and effect,
were  adopted  September  17,  1942,  by  resolution,  after  proper  notice  of
consideration  and adoption of By-Laws was given to each and every  shareholder,
at a regularly called meeting of the Board of Directors with a quorum present.

         4.  Pursuant  to the  authority  vested  in it by an  Act  of  Congress
approved December 23, 1913 and known as the Federal Reserve Act, as amended, the
Federal Reserve Board (now the Board of Governors of the Federal Reserve System)
has  granted to the  Association  now known as "First  Security  Bank,  National
Association"  of Ogden,  Utah,  the right to act, when not in  contravention  of
State or local law, as trustee, executor, administrator, registrar of stocks and
bonds,  guardian  of  estates,  assignee,  receiver,  committee  of  estates  of
lunatics,  or in any  other  fiduciary  capacity  in which  State  banks,  trust
companies or other  corporations which come into competition with National Banks
are  permitted  to act  under  the  laws of the  State of Utah;  and  under  the
provisions of applicable law, the authority so granted remains in full force and
effect.

         5. Pursuant to authority  vested by Act of Congress (12 U.S.C.  92a and
12 U.S.C. 481, as amended) the Comptroller of the Currency has issued Regulation
9, as amended,  dealing,  in part, with the Fiduciary  Powers of National Banks,
said regulation providing in subparagraph 9.7 (a) (1-2):

         (1)      The board of directors is responsible  for the proper exercise
                  of  fiduciary  powers  by  the  Bank.  All  matters  pertinent
                  thereto,   including  the   determination  of  policies,   the
                  investment  and  disposition  of  property  held in  fiduciary
                  capacity,  and the  direction and review of the actions of all
                  officers,  employees,  and committees  utilized by the Bank in
                  the exercise of its fiduciary powers,  are the  responsibility
                  of the board. In discharging this responsibility, the board of
                  directors  may assign,  by action duly entered in the minutes,
                  the  administration  of such of the Bank's fiduciary powers as
                  it  may  consider  proper  to  assign  to  such   director(s),
                  officer(s), employee(s) or committee(s) as it may designate.

         (2)      No  fiduciary  account  shall be  accepted  without  the prior
                  approval of the board,  or of the  director(s), officer(s), or
                  committee(s)  to  whom  the  board  may  have  designated  the
                  performance of that responsibility. . . .

         6. A Resolution relating to Exercise of Fiduciary Powers was adopted by
the Board of Directors at a meeting held July 26, 1994 at which time there was a
quorum  present;  said  resolution is still in full force and effect and has not
been   rescinded.   Said  resolution  is  attached  hereto  as  Schedule  C  and
incorporated herein by reference.

                                      F-2

<PAGE>


         7. A Resolution  relating to the  Designation of Officers and Employees
to Exercise  Fiduciary  Powers was adopted by the Trust  Policy  Committee  at a
meeting  held  February  7,  1996 at  which  time a  quorum  was  present;  said
resolution  is still in full force and effect and has not been  rescinded.  Said
resolution  is  attached  hereto as  Schedule  D and is  incorporated  herein by
reference.

         8. Attached hereto as Schedule E and incorporated  herein by reference,
is a listing of facsimile  signatures of persons authorized (herein  "Authorized
Signatory or  Signatories")  on behalf of the Association and its Trust Group to
act in exercise of its fiduciary powers subject to the resolutions in Paragraphs
6 and 7, above.

         9.  The  principal   office  of  the  First  Security  Bank,   National
Association,  Trust  Group and of its  departments,  except for the St.  George,
Utah, Ogden, Utah, and Provo, Utah, branch offices,  is located at 79 South Main
Street,  Salt Lake  City,  Utah  84111 and all  records  relating  to  fiduciary
accounts are located at such  principal  office of the Trust Group or in storage
facilities within Salt Lake County,  Utah, except for those of the Ogden,  Utah,
St. George,  Utah, and Provo,  Utah,  branch offices,  which are located at said
office.

         10. Each Authorized Signatory (i) is a duly elected or appointed,  duly
qualified  officer or employee of the Association;  (ii) holds the office or job
title  set  forth  below  his or her  name on the  date  hereof;  (iii)  and the
facsimile signature appearing opposite the name of each such officer or employee
is a true replica of his or her signature.

                                      F-3

<PAGE>


IN WITNESS  WHEREOF,  I have  hereunto  set my hand and  affixed the seal of the
Association this __________ day of ___________________, ______.



(SEAL)


                                     ----------------------------------------
                                     R. James Steenblik
                                     Senior Vice President
                                     Assistant Secretary



                                      F-4
<PAGE>


                                   Schedule A


                             Articles of Association


                                      F-5
<PAGE>


                                   Schedule B


                                     Bylaws


                                      F-6
<PAGE>


                                   Schedule C


                             Resolution Relating to
                          Exercise of Fiduciary Powers


                                      F-7
<PAGE>


                                   Schedule D

                           Resolution Relating to the
                      Designation of Officers and Employees
                          to Exercise Fiduciary Powers


                                      F-8
<PAGE>


                                   Schedule E

                       Authorized Signatory or Signatories



                                      F-9
<PAGE>



                                    EXHIBIT G


                 [Outside Counsel Opinion for the Owner Trustee]
                       (Pursuant to Section 5.3(bb) of the
                            Participation Agreement)

                              -----------, ------


TO THOSE ON THE ATTACHED DISTRIBUTION LIST

         Re:      Trust Agreement dated as of June 2, 1999

Dear Sirs:

         We have acted as special  counsel  for First  Security  Bank,  National
Association, a national banking association,  in its individual capacity ("FSB")
and in its capacity as trustee (the "Owner  Trustee")  under the Trust Agreement
dated as of June 2, 1999 (the "Trust Agreement") by and among it and First Union
National Bank, as holder (the  "Holder"),  in connection  with the execution and
delivery  by the Owner  Trustee  of the  Operative  Agreements  to which it is a
party.  Except as otherwise defined herein, the terms used herein shall have the
meanings set forth in Appendix A to the Participation Agreement dated as of June
2, 1999 (the  "Participation  Agreement") by and among Dollar Tree Distribution,
Inc.  (the  "Lessee"),  the  various  parties  thereto  from  time to  time,  as
guarantors (the "Guarantors"), First Security Bank, National Association, as the
Owner  Trustee  and First  Union  National  Bank,  as lender and holder (in such
capacity, "Bank").

         We have examined originals or copies, certified or otherwise identified
to our satisfaction, of such documents,  corporate records and other instruments
as we have deemed  necessary  or  advisable  for the purpose of  rendering  this
opinion.

Based upon the foregoing, we are of the opinion that:

         1.  FSB is a  national  banking  association  duly  organized,  validly
existing and in good standing under the laws of the United States of America and
each of FSB and the  Owner  Trustee  has under the laws of the State of Utah and
federal  banking  law the power and  authority  to enter  into and  perform  its
obligations  under the Trust  Agreement  and each other  Operative  Agreement to
which it is a party.

         2. The Owner  Trustee  is the duly  appointed  trustee  under the Trust
Agreement.

         3. The Trust Agreement has been duly authorized, executed and delivered
by one (1) of the officers of FSB and, assuming due authorization, execution and
delivery by the Holder,  is a legal,  valid and binding  obligation of the Owner
Trustee (and to the extent set forth therein,  against FSB), enforceable against
the  Owner  Trustee  (and to the  extent  set  forth  therein,

                                      G-1

<PAGE>

against FSB) in accordance with its terms, and the Trust Agreement creates under
the laws of the State of Utah for the  Holder  the  beneficial  interest  in the
Trust  Estate it  purports  to create and is a valid trust under the laws of the
State of Utah.

         4.  The  Operative  Agreements  to which it is  party  have  been  duly
authorized,  executed and  delivered by FSB,  and,  assuming due  authorization,
execution  and  delivery  by the other  parties  thereto,  are legal,  valid and
binding  obligations of FSB,  enforceable  against FSB in accordance  with their
respective terms.

         5.  The  Operative  Agreements  to which it is  party  have  been  duly
authorized,  executed and  delivered  by the Owner  Trustee,  and,  assuming due
authorization,  execution and delivery by the other parties thereto,  are legal,
valid and binding  obligations  of the Owner  Trustee,  enforceable  against the
Owner  Trustee  in  accordance  with  their  respective  terms.  The  Notes  and
Certificates have been duly issued, executed and delivered by the Owner Trustee,
pursuant to authorization contained in the Trust Agreement, and the Certificates
are entitled to the benefits  and  security  afforded by the Trust  Agreement in
accordance with its terms and the terms of the Trust Agreement.

         6. The  execution  and delivery by each of FSB and the Owner Trustee of
the Trust  Agreement  and the Operative  Agreements to which it is a party,  and
compliance  by FSB or the  Owner  Trustee,  as the case may be,  with all of the
provisions  thereof do not and will not  contravene  any Laws  applicable  to or
binding on FSB, or as the Owner  Trustee,  or contravene  the  provisions of, or
constitute  a  default  under,  its  charter  documents  or  by-laws  or, to our
knowledge after due inquiry, any indenture, mortgage contract or other agreement
or  instrument to which FSB or Owner Trustee is a party or by which it or any of
its property may be bound or affected.

         7. The execution  and delivery of the  Operative  Agreements by each of
FSB and the  Owner  Trustee  and the  performance  by each of FSB and the  Owner
Trustee of their respective  obligations thereunder does not require on or prior
to the date  hereof  the  consent or  approval  of, the giving of notice to, the
registration  or filing  with,  or the  taking of any  action in  respect of any
Governmental Authority or any court.

         8. Assuming that the trust created by the Trust Agreement is treated as
a grantor  trust for federal  income tax purposes  within the  contemplation  of
Section 671 through 678 of the Internal Revenue Code of 1986, there are no fees,
taxes,  or other  charges  (except  taxes  imposed on fees  payable to the Owner
Trustee)  payable to the State of Utah or any political  subdivision  thereof in
connection  with the execution,  delivery or performance by the Owner Trustee or
the Bank, as the case may be, of the Operative  Agreements or in connection with
the  acquisition of any Property by the Owner Trustee or in connection  with the
making by the Holder of its  investment in the Trust or its  acquisition  of the
beneficial  interest in the Trust Estate or in connection  with the issuance and
acquisition of the  Certificates,  or the Notes,  and neither the Owner Trustee,
the Trust Estate nor the trust created by the Trust Agreement will be subject to
any fee, tax or other  governmental  charge (except taxes on fees payable to the
Owner Trustee)

                                      G-2

<PAGE>

under the laws of the State of Utah or any  political  subdivision  thereof  on,
based on or measured by, directly or indirectly,  the gross receipts, net income
or value of the Trust Estate by reason of the creation or continued existence of
the trust  under the terms of the Trust  Agreement  pursuant  to the laws of the
State of Utah or the Owner  Trustee's  performance of its duties under the Trust
Agreement.

         9. There is no fee, tax or other governmental  charge under the laws of
the State of Utah or any political  subdivision thereof in existence on the date
hereof on, based on or measured by any payments under the Certificates, Notes or
the  beneficial  interest in the Trust Estate,  by reason of the creation of the
trust under the Trust Agreement pursuant to the laws of the State of Utah or the
Owner Trustee's  performance of its duties under the Trust Agreement  within the
State of Utah.

         10.  Upon the filing of the  financing  statement  on form UCC-1 in the
form  attached  hereto as Schedule 1 with the Utah Division of  Corporation  and
Commercial  Code,  the Bank's  security  interest  in the Trust  Estate  will be
perfected,  to the extent that such  perfection  is governed by Article 9 of the
Uniform Commercial Code as in effect in the State of Utah (the "Utah UCC").

         Your  attention is directed to the Utah UCC, which  provides,  in part,
that a filed  financing  statement which does not state a maturity date or which
states a  maturity  date of more  than five (5)  years is  effective  only for a
period of five (5) years from the date of filing,  unless  within six (6) months
prior to the expiration of said period a continuation  statement is filed in the
same  office  or  offices  in  which  the  original  statement  was  filed.  The
continuation  statement  must be  signed  by the  secured  party,  identify  the
original statement by file number and state that the original statement is still
effective. Upon the timely filing of a continuation statement, the effectiveness
of the original  financing  statement is continued  for five (5) years after the
last date to which the original statement was effective. Succeeding continuation
statements may be filed in the same manner to continue the  effectiveness of the
original statement.

The foregoing opinions are subject to the following assumptions,  exceptions and
qualifications:

         A. We are  attorneys  admitted  to practice in the State of Utah and in
rendering the  foregoing  opinions we have not passed upon, or purported to pass
upon, the laws of any jurisdictions other than the State of Utah and the federal
banking law governing the banking and trust powers of FSB. In addition,  without
limiting  the  foregoing  we  express  no opinion  with  respect to (i)  federal
securities  laws,  including  the  Securities  Act  of  1933,  as  amended,  the
Securities  Exchange Act of 1934,  as amended,  and the Trust  Indenture  Act of
1939, as amended,  (ii) the Federal Aviation Act of 1958, as amended,  (iii) the
Federal Communications Act of 1934, as amended, or (iv) state securities or blue
sky laws.  Insofar as the foregoing  opinions relate to the legality,  validity,
binding  effect  and   enforceability   of  the  documents   involved  in  these
transactions,  which by their  terms are  governed  by the laws of a state other
than Utah,  we have  assumed that the laws of such state (as to which we express
no opinion),  are in all material aspects  identical to the laws of the State of
Utah.

                                      G-3

<PAGE>

         B. The opinions set forth in  paragraphs  3, 4, and 5 above are subject
to the  qualification  that  enforceability of the Trust Agreement and the other
Operative  Agreements  to  which  FSB and the  Owner  Trustee  are  parties,  in
accordance  with their  respective  terms,  may be  limited  by (i)  bankruptcy,
insolvency,  reorganization,  moratorium, receivership or similar laws affecting
enforcement  of  creditors'  rights  generally,  and (ii) general  principles of
equity,  regardless of whether such enforceability is considered in a proceeding
in equity or at law.

         C. As to the documents involved in these transactions,  we have assumed
that each is a legal, valid and binding obligation of each party thereto,  other
than FSB or the Owner  Trustee,  and is  enforceable  against each such party in
accordance with their respective terms.

         D. We have assumed that all  signatures,  other than those of the Owner
Trustee or FSB, on documents and instruments  involved in these transactions are
genuine,  that all  documents and  instruments  submitted to us as originals are
authentic,  and that all  documents  and  instruments  submitted to us as copies
conform with the originals, which facts we have not independently verified.

         E. We do not  purport  to be experts  in  respect  of, or  express  any
opinion  concerning  laws,  rules or  regulations  applicable to the  particular
nature of the equipment or property involved in these transactions.

         F.  We  have  made no  investigation  of,  and we  express  no  opinion
concerning,  the nature of the title to any part of the  equipment  or  property
involved  in these  transactions  or the  priority  of any  mortgage or security
interest.

         G.  We  have  assumed  that  the   Participation   Agreement   and  the
transactions contemplated thereby are not within the prohibitions of Section 406
of the Employee Retirement Income Security Act of 1974.

         H. In addition to any other  limitation  by  operation  of law upon the
scope,  meaning, or purpose of this opinion, the opinions expressed herein speak
only as of the date hereof.  We have no obligation  to advise the  recipients of
this opinion (or any third party) and make no undertaking to amend or supplement
such  opinions if facts come to our  attention  or changes in the current law of
the  jurisdictions  mentioned  herein occur which could affect such opinions the
legal analysis, a legal conclusion or any information confirmation herein.

                                      G-4

<PAGE>


         I. This opinion is for the sole benefit of the Lessee, the Construction
Agent,  the  Guarantors,  the  Owner  Trustee,  the  Bank and  their  respective
successors  and  assigns  in  matters  directly  related  to  the  Participation
Agreement or the transaction  contemplated thereunder and may not be relied upon
by any other person other than such parties and their respective  successors and
assigns  without the express written  consent of the  undersigned.  The opinions
expressed in this letter are limited to the matter set forth in this letter, and
no other opinions should be inferred beyond the matters expressly stated.



                                     Very truly yours,

                                     RAY, QUINNEY & NEBEKER


                                     M. John Ashton


                                      G-5
<PAGE>


                                   SCHEDULE I

                       [Form of UCC-1 Financing Statement]

                                      G-6
<PAGE>


                                Distribution List


First Union National Bank, as lender and holder

Dollar Tree Distribution, Inc., as the Construction Agent and the Lessee

The various  parties to the  Participation  Agreement  from time to time, as the
Guarantors

First Security Bank, National Association,  not individually,  but solely as the
Owner Trustee under the DTSD Realty Trust 1999-1

                                      G-7
<PAGE>


                                    EXHIBIT H


                    [Outside Counsel Opinion for the Lessee]
          (Pursuant to Section 5.3(cc) of the Participation Agreement)


                                                        ---------------,------


TO THOSE ON THE ATTACHED DISTRIBUTION LIST

         Re:  Synthetic Lease Financing Provided in favor of Dollar Tree
              Distribution, Inc.

Dear Sirs:

We have acted as special counsel to Dollar Tree  Distribution,  Inc., a Virginia
corporation  (the  "Lessee")  and  the  Guarantors   (hereinafter   defined)  in
connection with certain transactions contemplated by the Participation Agreement
dated as of June 2, 1999 (the "Participation Agreement"),  among the Lessee, the
various  parties  thereto from time to time, as guarantors  (the  "Guarantors"),
First  Security  Bank,  National  Association,  as the Owner Trustee (the "Owner
Trustee"),  and First Union National Bank, as lender and holder  ("Bank").  This
opinion is delivered pursuant to Section 5.3(cc) of the Participation Agreement.
All capitalized terms used herein, and not otherwise defined herein,  shall have
the meanings assigned thereto in Appendix A to the Participation Agreement.

In  connection  with  the  foregoing,  we have  examined  originals,  or  copies
certified  to our  satisfaction,  of the  Operative  Agreements,  and such other
corporate, partnership or limited liability company documents and records of the
Credit Parties,  certificates  of public  officials and  representatives  of the
Credit Parties as to certain  factual  matters,  and such other  instruments and
documents which we have deemed necessary or advisable to examine for the purpose
of this  opinion.  With  respect to such  examination,  we have  assumed (i) the
statements of fact made in all such certificates,  documents and instruments are
true, accurate and complete; (ii) the due authorization,  execution and delivery
of the  Operative  Agreements  by the  parties  thereto  other  than the  Credit
Parties;  (iii) the genuineness of all signatures  (other than the signatures of
persons  signing  on  behalf  of  the  Credit  Parties),  the  authenticity  and
completeness of all documents, certificates,  instruments, records and corporate
records  submitted  to us as  originals  and  the  conformity  to  the  original
instruments of all documents submitted to us as copies, and the authenticity and
completeness  of the originals of such copies;  (iv) that all parties other than
the Credit Parties have all requisite  corporate power and authority to execute,
deliver and perform the Operative Agreements;  and (v) the enforceability of the
Operative  Agreements  against all parties thereto other than the Credit Parties
and  respecting the opinion set forth below in section (i), First Security Bank,
National Association,  individually or as the Owner Trustee, as the case may be.
We have  further  assumed  that the laws of the  States of  [state  of  lawyer's
admission]  and  [governing law of  Participation  Agreement] are  substantively
identical.

                                      H-1
<PAGE>


Based on the foregoing,  and having due regard for such legal  considerations as
we deem  relevant,  and subject to the  limitations  and  assumptions  set forth
herein,  including without  limitation the matters set forth in the last two (2)
paragraphs hereof, we are of the opinion that:

         (a)  Each  Credit  Party  is a  [corporation,  partnership  or  limited
liability  company] duly  [incorporated  or organized],  validly existing and in
good standing under the laws of the state of its  [incorporation/formation]  and
has the power and  authority to conduct its business as presently  conducted and
to execute,  deliver and perform its obligations under the Operative  Agreements
to which it is a party.  Each Credit  Party is duly  qualified to do business in
all jurisdictions in which its failure to so qualify would materially impair its
ability to perform its obligations under the Operative Agreements to which it is
a party or its financial  position or its business as now and now proposed to be
conducted.

         (b) The execution, delivery and performance by each Credit Party of the
Operative  Agreements  to which it is a party have been duly  authorized  by all
necessary  [corporate] action on the part of each Credit Party and the Operative
Agreements  to which each Credit  Party is a party have been duly  executed  and
delivered by each Credit Party.

         (c) The  Operative  Agreements  to which each  Credit  Party is a party
constitute  valid and  binding  obligations  of each  Credit  Party  enforceable
against  each Credit  Party in  accordance  with the terms  thereof,  subject to
bankruptcy, insolvency, liquidation, reorganization,  fraudulent conveyance, and
similar laws affecting  creditors' rights generally,  and general  principles of
equity  (regardless of whether the  application of such principles is considered
in a proceeding in equity or at law).

         (d) The  execution  and delivery by each Credit Party of the  Operative
Agreements  to which it is a party and  compliance by each Credit Party with all
of the provisions  thereof do not and will not (i) contravene the provisions of,
or result in any breach of or  constitute  any default  under,  or result in the
creation of any Lien (other than  Permitted  Liens and Lessor Liens) upon any of
its property under, its [Articles of Incorporation By-Laws, operating agreement,
partnership  agreement or other similar document of formation] or any indenture,
mortgage,  chattel mortgage,  deed of trust, lease,  conditional sales contract,
bank loan or credit  agreement  or other  agreement or  instrument  to which any
Credit  Party is a party or by which any  Credit  Party or any  property  of any
Credit Party may be bound or affected,  or (ii) contravene any Laws or any order
of any Governmental Authority applicable to or binding on any Credit Party.

         (e) No  Governmental  Action by, and no notice to or filing  with,  any
Governmental   Authority  is  required  for  the  due  execution,   delivery  or
performance by any Credit Party of any of the Operative  Agreements to which any
Credit  Party is a party or for the  acquisition,  ownership,  construction  and
completion of the Properties, except for those which have been obtained.

         (f)  Except as set forth on  Schedule 1 hereto,  there are no  actions,
suits or proceedings pending or to our knowledge,  threatened against any Credit
Party in any  court or before  any

                                      H-2

<PAGE>

Governmental  Authority,  that  concern the  Properties  or the  interest of any
Credit Party  therein or that  question the  validity or  enforceability  of any
Operative  Agreement  to  which  any  Credit  Party  is a party  or the  overall
transaction described in the Operative Agreements to which any Credit Party is a
party.

         (g) Neither the nature of the Properties,  nor any relationship between
any Credit Party and any other Person,  nor any  circumstance in connection with
the execution, delivery and performance of the Operative Agreements to which any
Credit Party is a party is such as to require any approval of  stockholders  of,
or approval or consent of any trustee or holders of indebtedness  of, any Credit
Party,  except for such approvals and consents which have been duly obtained and
are in full force and effect.

         (h) The Security Documents which have been executed and delivered as of
the date of this opinion create, for the benefit of Bank, the security interests
in the Collateral described therein which by their terms such Security Documents
purport to  create.  Upon  filing of the UCC-1  financing  statements  (attached
hereto as  Schedule  2)  relating to the  Security  Documents  in the  recording
offices of (A) the respective county clerk where the principal place of business
of the Lessee is located  and (B) the  Secretary  of State  where the  principal
place of business of the Lessee is  located,  Bank will have a valid,  perfected
lien and  security  interest  in that  portion  of the  Collateral  which can be
perfected by the filing of UCC-1 financing statements under Article 9 of the UCC
in [identify the state].

         (i)      [Reserved].

         (j) The  issuance,  sale and delivery of the Notes and the issuance and
delivery  of  the  Certificates  under  the  circumstances  contemplated  by the
Participation  Agreement do not, under existing law, require registration of the
Notes or the  Certificates  being issued on the date hereof under the Securities
Act of 1933, as amended,  or the  qualification  of the Loan Agreement under the
Trust Indenture Act of 1939, as amended.

This opinion is limited to the matters  stated  herein and no opinion is implied
or may be inferred  beyond the matters stated  herein.  This opinion is based on
and is limited to the laws of the States of  [__________],  and the federal laws
of the United  States of America.  Insofar as the foregoing  opinion  relates to
matters of law other than the foregoing, no opinion is hereby given.

This opinion is for the sole benefit of the Lessee, the Construction  Agent, the
Guarantors,  the Owner Trustee, Bank and their respective successors and assigns
and may not be relied upon by any other person other than such parties and their
respective  successors and assigns  without the express  written  consent of the
undersigned. The opinions expressed herein are as of the date hereof and we make
no  undertaking  to amend  or  supplement  such  opinions  if facts  come to our
attention or changes in the current law of the  jurisdictions  mentioned  herein
occur which could affect such opinions.

                                      H-3

<PAGE>

                                     Very truly yours,

                                     [LESSEE'S OUTSIDE COUNSEL]


                                      H-4
<PAGE>


                                Distribution List



First Union National Bank, as lender and holder

Dollar Tree Distribution, Inc., as the Construction Agent and the Lessee

The various  parties to the  Participation  Agreement  from time to time, as the
Guarantors

First Security Bank, National Association,  not individually,  but solely as the
Owner Trustee under the DTSD Real Estate Trust 1999-1


                                      H-5
<PAGE>


                                   Schedule 1

                                  (Litigation)


                                      H-6
<PAGE>


                                   Schedule 2

                          (UCC-1 Financing Statements)

                                      H-7
<PAGE>


                                    EXHIBIT I


                         DOLLAR TREE DISTRIBUTION, INC.

                              OFFICER'S CERTIFICATE
            (Pursuant to Section 5.5 of the Participation Agreement)


         DOLLAR TREE DISTRIBUTION,  INC., a Virginia corporation (the "Company")
DOES HEREBY CERTIFY as follows:

1.   The address for the subject Property is ___________________________________
     _____________________________________.

2.   The Completion Date for the construction  of  Improvements  at the Property
     occurred on ______________.

3.   The aggregate Property Cost for the Property was $___________.

4.   Attached hereto as Schedule 1 is the detailed,  itemized  documentation
     supporting the asserted Property Cost figures.

5.   All  representations  and  warranties of the Company in each  Operative
     Agreement and in each certificate delivered pursuant thereto (including
     without limitation the Incorporated Representations and Warranties) are
     true and correct as of the Completion Date.

Capitalized  terms used in this Officer's  Certificate and not otherwise defined
have the respective  meanings  ascribed thereto in the  Participation  Agreement
dated  as of  June  2,  1999  among  the  Company,  as  the  Lessee  and  as the
Construction Agent, the various parties thereto from time to time, as guarantors
(the  "Guarantors"),  First Security Bank,  National  Association,  as the Owner
Trustee and First Union National Bank, as lender and holder.

         [The remainder of this page has been intentionally left blank.]


                                      I-1
<PAGE>


         IN WITNESS WHEREOF,  the Company has caused this Officer's  Certificate
to be duly executed and delivered as of this ____ day of ______________, ______.


                                     DOLLAR TREE DISTRIBUTION, INC.


                                     By:
                                     Name:
                                     Title:


                                      I-2
<PAGE>


                                   Schedule I

          (Itemized Documentation in Support of Asserted Property Cost)
                                      I-3
<PAGE>


                                    EXHIBIT J

                                JOINDER AGREEMENT
           (Pursuant to Section 5.9(a) of the Participation Agreement)


         THIS JOINDER AGREEMENT (as amended,  modified,  supplemented,  restated
and/or replaced from time to time, the "Agreement"),  dated as of _____________,
______,  is by and between  ___________________,  a ___________ (the "Company"),
and FIRST UNION NATIONAL BANK, as lender and holder ("Bank").  Capitalized terms
not otherwise  defined  herein shall have the meanings set forth therefor in the
Participation  Agreement  dated  as of  June  2,  1999  (as  amended,  modified,
supplemented,  restated  and/or  replaced from time to time, the  "Participation
Agreement")  among Dollar Tree  Distribution,  Inc., the various parties thereto
from time to time, as the Guarantors, First Security Bank, National Association,
as the Owner Trustee under the DTSD Real Estate Trust 1999-1 and Bank.

         The Company is a Domestic  Subsidiary,  and,  consequently,  the Credit
Parties are required by Section 8.3(n) of the  Participation  Agreement to cause
the Company to become a "Guarantor".

         Accordingly, the Company hereby agrees as follows with Bank:

         1. The Company  hereby  acknowledges,  agrees and confirms that, by its
execution  of this  Agreement,  the Company  will be deemed to be a party to the
Participation  Agreement and a "Guarantor" for all purposes of the Participation
Agreement  and  all  other  Operative  Agreements,  and  shall  have  all of the
obligations of a Guarantor under the Operative  Agreements as if the Company had
executed the  Participation  Agreement.  The Company hereby ratifies,  as of the
date  hereof,  and  agrees  to be bound by,  all of the  terms,  provisions  and
conditions  applicable to the Guarantors contained in the Operative  Agreements.
Without  limiting the generality of the foregoing terms of this paragraph 1, the
Company  hereby (i) jointly and severally  together  with the other  Guarantors,
guarantees to each Financing Party, as provided in Sections 6B.1 through 6B.8 of
the Participation  Agreement,  the prompt payment and performance of the Company
Obligations  in full  when due  (whether  at  stated  maturity,  as a  mandatory
prepayment,  by acceleration or otherwise) strictly in accordance with the terms
thereof.

         2.  THE  COMPANY  HEREBY  EXPRESSLY  ACKNOWLEDGES  AND  AGREES  TO  THE
PROVISIONS OF SECTION 12.7 OF THE  PARTICIPATION  AGREEMENT,  INCLUDING  WITHOUT
LIMITATION THOSE PROVISIONS REGARDING GOVERNING LAW, SUBMISSION TO JURISDICTION,
WAIVER  OF  JURY  TRIAL,   VENUE  AND  ARBITRATION.   THIS  PROVISION  HAS  BEEN
SPECIFICALLY REVIEWED BY THE COMPANY.

         3. The chief  executive  office and principal  place of business of the
Company are located at the location(s) set forth on Schedule 1 attached hereto.

                                      J-1

<PAGE>

         4. All notices and other  communications to be delivered to the Company
shall be directed to  [___________]  at its address set forth in Section 12.2 of
the  Participation  Agreement  or such  other  address as may be  specified,  in
accordance with the terms of the Participation  Agreement, by [___________] from
time to time.

         5. The Company hereby waives acceptance by the Financing Parties of the
guaranty by the Company under  Sections  6B.1 through 6B.8 of the  Participation
Agreement upon the execution of this Agreement by the Company.

         6. This  Agreement  may be executed in multiple  counterparts,  each of
which shall  constitute an original but all of which when taken  together  shall
constitute one contract.

         7. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED AND INTERPRETED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NORTH CAROLINA.

         IN WITNESS  WHEREOF,  the Company has caused this  Agreement to be duly
executed by its authorized officers, and Bank has caused the same to be accepted
by its authorized officer, as of the day and year first above written.


                                     [COMPANY]


                                     By:
                                     Name:
                                     Title:


                                     Acknowledged and accepted:

                                     FIRST UNION NATIONAL BANK,
                                     as lender and holder

                                     By:
                                     Name:
                                     Title:


                                      J-2
<PAGE>


                                   Schedule 1

                           [Chief Executive Office and
                   Principal Place of Business of the Company]




                                      J-3
<PAGE>



                                    EXHIBIT K

                       DESCRIPTION OF MATERIAL LITIGATION
            PURSUANT TO SECTION 6.2(d) OF THE PARTICIPATION AGREEMENT

         There are no material actions,  suits or proceedings pending or, to our
knowledge,  threatened  against  any  Credit  Party in any court or  before  any
Governmental Authority except as set forth below:

                  In February, 1998, Dollar Tree Stores, Inc., received a report
         that a  customer,  Lucy  Oritz,  had been  injured  when the clasp on a
         retractable dog leash broke. The general liability  insurance  carriers
         for the Credit  Parties  (primary and umbrella)  have been notified and
         are expected to cover fully any  compensatory  damages for which any of
         the Credit  Parties may be liable.  Ms.  Ortiz has retained an attorney
         who has  indicated  she may seek punitive  damages.  Insurance  against
         punitive  damages is generally  not  available in Florida.  Dollar Tree
         Stores,  Inc.,  emphatically  denies any liability for punitive damages
         and will  vigorously  defend against any such claim. It is not possible
         at this time to state whether an unfavorable outcome is either probable
         or remote, since no suit has been filed.

                  On April 14, 1998, a former retail store employee named Gloria
         J. Mosher filed a lawsuit in federal court in Chicago, Illinois against
         Dollar  Tree  Stores,  Inc.,  and one of its store  managers,  alleging
         sexual  harassment by the store manager,  constructive  discharge,  and
         intentional  infliction of emotional distress.  Ms. Mosher is suing for
         $3,000,000 in compensatory and punitive damages. Ms. Mosher has alleged
         the  bulk of her  damages  are  punitive.  Dollar  Tree  Stores,  Inc.,
         emphatically  denies Ms.  Mosher's  claims and is vigorously  defending
         itself in this matter.  We are unable to state  whether an  unfavorable
         outcome is either probable or remote,  as the lawsuit has not reached a
         stage where such a judgment may be made.

                                      K-1
<PAGE>


                                    EXHIBIT L

 [States of Incorporation/Formation and Principal Place of Business of Each
                                   Guarantor]
           (Pursuant to Section 6.2(i) of the Participation Agreement)


                                         State of             State of Principal
       Guarantors                 Incorporation/Formation      Place of Business

Dollar Tree Stores, Inc.                 Virginia                      Virginia
Dollar Tree Management, Inc.             Virginia                      Virginia





                                      L-1
<PAGE>


                                    EXHIBIT M


                        OFFICER'S COMPLIANCE CERTIFICATE
           (Pursuant to Section 8.3(k) of the Participation Agreement)


         The  undersigned,  on behalf of Dollar Tree  Stores,  Inc.,  a Virginia
corporation (the  "Company"),  hereby certifies to First Union National Bank, as
lender and holder ("Bank"),  under the Participation  Agreement dated as of June
2, 1999 (as amended, modified, supplemented,  restated and/or replaced from time
to time, the "Participation Agreement") among Dollar Tree Distribution, Inc., in
its capacity as the Lessee and as the  Construction  Agent,  the various parties
thereto from time to time, as the  Guarantors,  First  Security  Bank,  National
Association, as the Owner Trustee and Bank, as follows:

         1. This  Certificate  is delivered to you pursuant to Section 8.3(k) of
the  Participation  Agreement.  Capitalized  terms used  herein and not  defined
herein shall have the meanings assigned thereto in the Participation Agreement.

         2. I have  reviewed  the  financial  statements  of the Company and its
Consolidated  Subsidiaries  dated as of  ___________,  ______ and for the fiscal
quarter then ended and such statements fairly present the financial condition of
the Company and its Consolidated  Subsidiaries as of the dates indicated and the
results of its operations and cash flows for the period indicated.

         3. I have reviewed the terms of the Operative Agreements and have made,
or caused to be made under my supervision,  a review in reasonable detail of the
transactions and the condition of the Company and its Consolidated  Subsidiaries
during the accounting period covered by the financial  statements referred to in
Paragraph 2 above.  Such review has not disclosed the existence during or at the
end of such  accounting  period of any  condition  or event that  constitutes  a
Default or Event of Default, nor do I have any knowledge of the existence of any
such condition or event as at the date of this Certificate.

         4. The ratio of  Consolidated  Funded Debt to  Consolidated  EBITDA and
calculations  determining  such figure are set forth on the attached  Schedule 1
and the Company and its  Consolidated  Subsidiaries  are in compliance  with the
covenants referenced in Section 28.1 of the Lease and the covenants contained in
Section 9 of the Lessee  Credit  Agreement  as shown on such  Schedule 1 and the
Company  and its  Consolidated  Subsidiaries  are in  compliance  with the other
covenants and restrictions referenced in Section 28.1 of the Lease and contained
in Sections 7, 8 and 9 of the Lessee Credit Agreement.

                                      M-1

<PAGE>


         WITNESS the  following  signature as of the ______ day of  ___________,
______.


                                     DOLLAR TREE STORES, INC.

                                     By:
                                     Name:
                                     Title:




                                      M-2
<PAGE>


                                   Schedule 1
                                       to
                        Officer's Compliance Certificate

                                     [DATE]


                                      M-3
<PAGE>













                                   Appendix A
                         Rules of Usage and Definitions



                                I. Rules of Usage


The  following  rules of usage shall apply to this  Appendix A and the Operative
Agreements  (and each  appendix,  schedule,  exhibit and annex to the foregoing)
unless otherwise required by the context or unless otherwise defined therein:

         (a) Except as otherwise expressly  provided,  any definitions set forth
herein or in any other document shall be equally  applicable to the singular and
plural forms of the terms defined.

         (b) Except as otherwise expressly provided,  references in any document
to articles, sections,  paragraphs,  clauses, annexes, appendices,  schedules or
exhibits are references to articles,  sections,  paragraphs,  clauses,  annexes,
appendices, schedules or exhibits in or to such document.

         (c)  The  headings,  subheadings  and  table  of  contents  used in any
document are solely for convenience of reference and shall not constitute a part
of any such document nor shall they affect the meaning,  construction  or effect
of any provision thereof.

         (d) References to any Person shall include such Person, its successors,
permitted assigns and permitted transferees.

         (e) Except as otherwise expressly provided,  reference to any agreement
means such  agreement as amended,  modified,  extended,  supplemented,  restated
and/or replaced from time to time in accordance  with the applicable  provisions
thereof.

                                   Appendix-1

<PAGE>


         (f)  Except as  otherwise  expressly  provided,  references  to any law
includes any amendment or  modification to such law and any rules or regulations
issued thereunder or any law enacted in substitution or replacement therefor.

         (g) When used in any  document,  words such as  "hereunder",  "hereto",
"hereof" and "herein" and other words of like import  shall,  unless the context
clearly indicates to the contrary, refer to the whole of the applicable document
and not to any  particular  article,  section,  subsection,  paragraph or clause
thereof.

         (h)  References to "including"  means  including  without  limiting the
generality of any  description  preceding such term and for purposes  hereof the
rule of ejusdem  generis shall not be  applicable to limit a general  statement,
followed by or  referable  to an  enumeration  of specific  matters,  to matters
similar to those specifically mentioned.

         (i) Each of the parties to the Operative  Agreements  and their counsel
have reviewed and revised, or requested revisions to, the Operative  Agreements,
and the usual  rule of  construction  that any  ambiguities  are to be  resolved
against  the  drafting  party  shall be  inapplicable  in the  construction  and
interpretation  of the  Operative  Agreements  and any  amendments  or  exhibits
thereto.

         (j) Capitalized  terms used in any Operative  Agreements  which are not
defined in this Appendix A but are defined in another Operative  Agreement shall
have the meaning so ascribed to such term in the applicable Operative Agreement.


                                 II. Definitions

         "AAA" shall have the meaning  given to such term in Section  12.7(d) of
the Participation Agreement.

         "ABR" shall mean, for any day, a rate per annum equal to the greater of
(a) the Prime  Lending  Rate in effect on such day,  and (b) the  Federal  Funds
Effective  Rate in effect on such day plus one-half of one percent  (0.5%).  For
purposes hereof:  "Prime Lending Rate" shall mean the rate announced by the Bank
from time to time as its prime lending rate as in effect from time to time.  The
Prime Lending Rate is a reference rate and is one of several interest rate bases
used by the Bank and does not necessarily represent the lowest or most favorable
rate offered by the Bank  actually  charged to any  customer.  The Bank may make
commercial  loans or other  loans at rates of  interest  at,  above or below the
Prime  Lending  Rate.  The Prime  Lending  Rate shall change  automatically  and
without  notice from time to time as and when the prime lending rate of the Bank
changes.   "Federal  Funds  Effective  Rate"  shall  mean,  for  any  period,  a
fluctuating interest rate per annum equal for each day during such period to the
weighted  average of the rates on  overnight  Federal  funds  transactions  with
members or the Federal  Reserve  System  arranged by Federal funds  brokers,  as
published  for such day (or,  if such day is not a  Business  Day,  for the next
preceding  Business  Day) by the Federal  Reserve Bank of New York,  or, if such
rate is not so published for any day which is a Business Day, the average of the
quotations  for such day on

                                   Appendix-2

<PAGE>


such transactions  received by the Agent from three (3) Federal funds brokers of
recognized standing selected by it. Any change in the ABR due to a change in the
Prime Lending Rate or the Federal Funds  Effective Rate shall be effective as of
the opening of business on the effective day of such change in the Prime Lending
Rate or the Federal Funds Effective Rate, respectively.

         "ABR Holder Advance" shall mean a Holder Advance bearing a Holder Yield
based on the ABR.

         "ABR Loans" shall mean Loans the rate of interest  applicable  to which
is based upon the ABR.

         "Acceleration"  shall have the meaning  given to such term in Section 6
of the Credit Agreement.

         "Accounts"  shall have the  meaning  given to such term in Section 1 of
the Security Agreement.

         "Acquisition  Advance"  shall  have the  meaning  given to such term in
Section 5.3 of the Participation Agreement.

         "Acquisition  Loan"  shall  mean any Loan  made in  connection  with an
Acquisition Advance.

         "Additional  Incorporated  Terms" shall have the meaning  given to such
term in Section 28.1 of the Lease.

         "Advance" shall mean a Construction Advance or an Acquisition Advance.

         "Affiliate" shall mean, with respect to any Person, any Person or group
acting in  concert  in  respect of the  Person in  question  that,  directly  or
indirectly,  controls or is controlled  by or is under common  control with such
Person.

         "After  Tax  Basis"  shall  mean,  with  respect  to any  payment to be
received,  the amount of such payment  increased so that, after deduction of the
amount of all taxes required to be paid by the recipient  calculated at the then
maximum  marginal rates generally  applicable to Persons of the same type as the
recipients  with respect to the receipt by the  recipient of such amounts  (less
any tax savings realized as a result of the payment of the indemnified  amount),
such  increased  payment  (as so  reduced)  is  equal to the  payment  otherwise
required to be made.

         "Agency  Agreement" shall mean the Agency Agreement,  dated on or about
the Initial Closing Date between the Construction Agent and the Lessor.

         "Agency Agreement Event of Default" shall mean an "Event of Default" as
defined in Section 5.1 of the Agency Agreement.

                                   Appendix-3

<PAGE>


         "Applicable  Percentage"  shall mean for Eurodollar  Loans,  Eurodollar
Holder  Advances,  ABR  Loans  and  ABR  Holder  Advances  and  the  appropriate
applicable percentages corresponding to the ratio of Consolidated Funded Debt to
Consolidated  EBITDA in effect as of the most recent  Calculation  Date as shown
below:
<TABLE>
<CAPTION>

                                                               Applicable
                                                Applicable     Percentage      Applicable     Applicable
                                                Percentage         for         Percentage     Percentage
                                                    for        Eurodollar         for           for ABR
Pricing        Ratio of Consolidated Funded     Eurodollar       Holder           ABR           Holder
Level          Debt to Consolidated EBITDA         Loans        Advances         Loans         Advances
------------ --------------------------------- -------------- -------------- --------------- ------------
<S>           <C>                                  <C>            <C>            <C>             <C>
Level I       Less than or equal to .75 to 1       0.50%          1.25%          0.00%           0.00%
Level II      Less than or equal to 1.25 to
               1, but greater than .75 to 1        0.60%          1.35%          0.00%           0.75%
Level III         Greater than 1.25 to 1           1.05%          1.80%          0.00%           0.75%
</TABLE>


         The  Applicable  Percentage  for Eurodollar  Loans,  Eurodollar  Holder
Advances,  ABR Loans and ABR Holder  Advances shall, in each case, be determined
and adjusted quarterly based upon, and as of, the fifth (5th) Business Day after
the due date of the  financial  statements  required to be delivered to the Bank
under Section 8.3(m)(ii) of the Participation  Agreement,  Section 7.4(b) of the
Lessee  Credit  Agreement  and Section  28.1 of the Lease  (each a  "Calculation
Date"); provided,  however, that (i) the initial Applicable Percentage,  in each
case,  shall be based on Pricing  Level I (as shown  above) and shall  remain at
Pricing  Level I until the  occurrence of the  Calculation  Date relating to the
first  fiscal  quarter  of  the  Lessee  occurring  in  fiscal  year  1999  and,
thereafter,  the Pricing  Level shall be determined by the then current ratio of
Consolidated Funded Debt to Consolidated EBITDA, and (ii) if the Lessee fails to
provide  the written  notice  required  by Section  8.3(k) of the  Participation
Agreement  to the Agent on or  before  the most  recent  Calculation  Date,  the
Applicable  Percentage,  in each case, from such Calculation Date shall be based
on  Pricing  Level III until  such time  that such  written  notice is  provided
whereupon  the Pricing  Level shall be  determined  by the then current ratio of
Consolidated  Funded Debt to  Consolidated  EBITDA as  specified in such notice.
Each Applicable  Percentage  shall be effective from one Calculation  Date until
the next Calculation Date. Any adjustment in the Applicable  Percentage shall be
applicable to all existing  Eurodollar Loans,  Eurodollar  Holder Advances,  ABR
Loans and ABR Holder  Advances as well as any new Eurodollar  Loans,  Eurodollar
Holder Advances, ABR Loans and ABR Holder Advances made or issued.

         "Appraisal"  shall mean, with respect to any Property,  an appraisal to
be delivered in  connection  with the  Participation  Agreement or in accordance
with the terms of the Lease,  in each case  prepared  by a  reputable  appraiser
reasonably  acceptable  to the Agent,  which in the  judgment  of counsel to the
Agent, complies with all of the provisions of the Financial Institutions Reform,
Recovery and  Enforcement  Act of 1989,  as amended,  the rules and  regulations
adopted  pursuant  thereto,  and all other  applicable  Legal  Requirements  and
otherwise satisfactory to the Bank.

                                   Appendix-4

<PAGE>


         "Appraisal Procedure" shall have the meaning given such term in Section
22.4 of the Lease.

         "Appurtenant Rights" shall mean (a) all agreements,  easements,  rights
of  way  or  use,  rights  of  ingress  or  egress,  privileges,  appurtenances,
tenements,  hereditaments and other rights and benefits at any time belonging or
pertaining  to  the  Land  underlying  the  Improvements  or  the  Improvements,
including without  limitation the use of any streets,  ways,  alleys,  vaults or
strips of land adjoining,  abutting,  adjacent or contiguous to the Land and (b)
all permits, licenses and rights, whether or not of record,  appurtenant to such
Land or the Improvements.

         "Arbitration  Rules"  shall  have the  meaning  given  to such  term in
Section 12.7(d) of the Participation Agreement.

         "Assignment and Acceptance" shall mean the Assignment and Acceptance in
the form attached to the Credit Agreement as Exhibit B.

         "Available  Commitment"  shall mean an amount  equal to the excess,  if
any, of (a) the amount of the Commitment over (b) the aggregate principal amount
of all Loans made as of such date after giving  effect to Section  5.2(d) of the
Participation  Agreement (but without  giving effect to any other  repayments or
prepayments of any Loans hereunder).

         "Available  Holder  Commitments"  shall  mean an  amount  equal  to the
excess,  if any, of (a) the aggregate amount of the Holder  Commitments over (b)
the aggregate  amount of the Holder Advances made since the Initial Closing Date
after  giving  effect to  Section  5.2(d) of the  Participation  Agreement  (but
without  giving  effect to any other  repayments  or  prepayments  of any Holder
Advances).

         "Bank"  shall mean  First  Union  National  Bank,  a  national  banking
association, and its permitted successors and assigns.

         "Bankruptcy  Code" shall  mean  Title  11 of  the  U. S. Code  entitled
"Bankruptcy,"  as now or  hereafter in effect or any successor thereto.

         "Basic Documents" shall mean the following: the Participation Agreement
the  Agency  Agreement,  the  Trust  Agreement,  the  Certificates,  the  Credit
Agreement, the Notes, the Lease and the Security Agreement.

         "Basic Rent" shall mean, the sum of (a) the Loan Basic Rent and (b) the
Lessor Basic Rent,  calculated as of the applicable  date on which Basic Rent is
due.

         "Bill of Sale" shall mean a Bill of Sale  regarding  Equipment  in form
and substance satisfactory to the Agent.

         "Board" shall mean the Board of Governors of the Federal Reserve System
of the United States (or any successor).

                                   Appendix-5


<PAGE>

         "Borrower" shall mean the Owner Trustee, not in its individual capacity
but as Borrower under the Credit Agreement.

         "Borrowing  Date" shall mean any  Business  Day  specified  in a notice
delivered pursuant to Section 2.3 of the Credit Agreement as a date on which the
Lessor requests the Bank to make Loans hereunder.

         "Budgeted Total Property Cost" shall mean, at any date of determination
with  respect  to any  Construction  Period  Property,  an  amount  equal to the
aggregate  amount  which the  Construction  Agent in good  faith  expects  to be
expended in order to achieve Completion with respect to such Property.

         "Business Day" shall mean a day other than a Saturday,  Sunday or other
day on which commercial banks in North Carolina,  or any other states from which
the Bank funds or  engages  in  administrative  activities  with  respect to the
transactions under the Operative Agreements are authorized or required by law to
close;  provided,  however, that when used in connection with a Eurodollar Loan,
the term  "Business  Day" shall also exclude any day on which banks are not open
for dealings in dollar deposits in the London interbank market.

         "Capitalized  Lease" shall mean, as applied to any Person, any lease of
property (whether real, personal, tangible,  intangible or mixed of such Person)
by such Person as the lessee which would be  capitalized  on a balance  sheet of
such Person prepared in accordance with GAAP.

         "Capital  Stock"  shall  mean any  nonredeemable  capital  stock of the
Lessee or any of its Subsidiaries, whether common or preferred.

         "Casualty"  shall mean any damage or  destruction of all or any portion
of the Property as a result of a fire or other casualty.

         "CERCLA"   shall  mean  the   Comprehensive   Environmental   Response,
Compensation,  and Liability Act of 1980, 42 U.S.C. ss. 9601 et seq., as amended
by the Superfund Amendments and Reauthorization Act of 1986.

         "Certificate"  shall mean a Certificate  in favor of the Bank regarding
the Holder  Commitment  issued pursuant to the terms and conditions of the Trust
Agreement.

         "Chattel  Paper" shall have the meaning given to such term in Section 1
of the Security Agreement.

         "Claims"  shall  mean  any and all  obligations,  liabilities,  losses,
actions,  suits,  penalties,  claims,  demands,  costs and  expenses  (including
without  limitation  reasonable  attorney's  fees and  expenses)  of any  nature
whatsoever.

         "Closing  Date" shall mean the Initial  Closing Date and each  Property
Closing Date.

                                   Appendix-6

<PAGE>


         "Code" shall mean the Internal Revenue Code of 1986 together with rules
and  regulations  promulgated  thereunder,  as amended from time to time, or any
successor statute thereto.

         "Collateral"  shall mean all  assets of the  Lessor,  the  Construction
Agent and the  Lessee,  now owned or  hereafter  acquired,  upon which a Lien is
purported to be created by one or more of the Security Documents.

         "Commencement Date" shall have  the meaning specified in Section 2.2 of
the Lease.

         "Commitment" shall mean the obligation of the Bank to make Loans to the
Lessor in an aggregate  principal  amount at any time  outstanding not to exceed
the Lender Commitment.

         "Commitment  Period"  shall  mean the  period  from and  including  the
Initial Closing Date to and including the Construction  Period Termination Date,
or such  earlier  date as the  Commitments  shall  terminate  as provided in the
Credit  Agreement or the Holder  Commitment  shall  terminate as provided in the
Trust Agreement.

         "Company  Obligations"  shall  mean  the  obligations  of  Dollar  Tree
Distribution,  Inc.,  in any and all  capacities  under and with  respect to the
Operative Agreements and each Property.

         "Completion"  shall mean, with respect to a Property,  such time as the
acquisition,  installation,  testing and final completion of the Improvements on
such Property has been achieved in accordance with the Plans and Specifications,
the  Agency  Agreement  and/or  the  Lease,  and in  compliance  with all  Legal
Requirements and Insurance  Requirements and a certificate of occupancy has been
issued with  respect to such  Property by the  appropriate  governmental  entity
(except if non-compliance,  individually or in the aggregate, shall not have and
could not  reasonably  be expected to have a Material  Adverse  Effect).  If the
Lessor purchases a Property that includes  existing  Improvements that are to be
immediately occupied by the Lessee without any improvements financed pursuant to
the Operative Agreements,  the date of Completion for such Property shall be the
Property Closing Date.

         "Completion  Date" shall mean, with respect to a Property,  the earlier
of (a) the date on which  Completion  for such  Property has occurred or (b) the
Construction Period Termination Date.

         "Condemnation"  shall  mean  any  taking  or sale of the  use,  access,
occupancy,  easement rights or title to any Property or any part thereof, wholly
or partially  (temporarily  or  permanently),  by or on account of any actual or
threatened  eminent  domain  proceeding  or other taking of action by any Person
having the power of eminent domain,  including without limitation an action by a
Governmental Authority to change the grade of, or widen the streets adjacent to,
any Property or alter the  pedestrian or vehicular  traffic flow to any Property
so as to result in a change in access to such  Property,  or by or on account of
an  eviction  by  paramount  title  or any  transfer  made in  lieu of any  such
proceeding or action.

                                   Appendix-7

<PAGE>


         "Consolidated  EBITDA" shall mean, for any period, the aggregate of (i)
the  Consolidated  Net Income (or Deficit) of DTS and its  Subsidiaries for such
period,  plus (ii) the sum of interest expense,  federal,  state or local income
taxes,  depreciation,  amortization  of  intangible  assets  and  other  noncash
expenses or charges  reducing  income for such  period,  all to the extent taken
into account in the calculation of such Consolidated Net Income (or Deficit) for
such  period,  minus  (iii)  the  sum of  extraordinary  or  nonrecurring  gains
(including in connection  with the sale or write-up of assets) and other noncash
credits  increasing income for such period, all to the extent taken into account
in the calculation of such Consolidated Net Income (or Deficit) for such period.

         "Consolidated  Funded Debt" shall mean,  at any time,  the  outstanding
balances of all  Indebtedness or other  extensions of credit in favor of DTS and
its Subsidiaries (on a consolidated  basis),  plus Capitalized Leases of DTS and
its Subsidiaries (on a consolidated basis).

         "Consolidated Net Income (or Deficit)" shall mean, for any period,  net
income on a consolidated  basis  determined in accordance with GAAP applied on a
consistent  basis, but excluding any  extraordinary  gains or losses and related
tax effects thereon.

         "Consolidated  Subsidiary" shall mean, as to any Person, any Subsidiary
of such Person which under the rules of GAAP  consistently  applied  should have
its  financial  results  consolidated  with those of such Person for purposes of
financial accounting statements.

         "Construction  Advance"  shall mean an advance of funds to pay Property
Costs pursuant to Section 5.4 of the Participation Agreement.

         "Construction  Agent"  shall mean Dollar  Tree  Distribution,  Inc.,  a
Virginia corporation, as the construction agent under the Agency Agreement.

         "Construction Budget" shall mean the cost of acquisition, installation,
testing,   constructing  and  developing  any  Property  as  determined  by  the
Construction Agent in its reasonable, good faith judgment.

         "Construction   Commencement   Date"  shall  mean,   with   respect  to
Improvements,  the date on which  construction  of such  Improvements  commences
pursuant to the Agency Agreement.

         "Construction  Contract"  shall mean any contract  entered into between
the  Construction  Agent or the Lessee with a Contractor for the construction of
Improvements or any portion thereof on the Property.

         "Construction  Loan"  shall  mean any Loan  made in  connection  with a
Construction Advance.

         "Construction  Loan  Property  Cost"  shall  mean with  respect to each
Construction  Period Property at the date of  determination,  an amount equal to
(a) the aggregate  principal  amount of  Construction  Loans made on or prior to
such date with respect to the Property minus (b) the

                                   Appendix-8

<PAGE>


aggregate  principal  amount of prepayments or repayments of the Loans allocated
to reduce the  Construction  Loan  Property  Cost of such  Property  pursuant to
Section 2.6(c) of the Credit Agreement.

         "Construction  Period"  shall mean,  with  respect to a  Property,  the
period  commencing on the Construction  Commencement  Date for such Property and
ending on the Completion Date for such Property.

         "Construction Period Property" means, at any date of determination, any
Property as to which the Rent  Commencement Date has not occurred on or prior to
such date.

         "Construction  Period  Termination  Date" shall mean (a) the earlier of
(i) the date that the  Commitments  have been  terminated  in their  entirety in
accordance with the terms of Section 2.5(a) of the Credit Agreement, or (ii) the
second  anniversary of the Initial  Closing Date or (b) such later date as shall
be agreed to by the Bank.

         "Contractor" shall mean each entity with whom the Construction Agent or
the Lessee contracts to construct any Improvements or any portion thereof on the
Property.

         "Controlled  Group"  shall mean all  members of a  controlled  group of
corporations and all trades or businesses  (whether or not  incorporated)  under
common control which, together with the Lessee, are treated as a single employer
under Section 414 of the Code.

         "Co-Owner  Trustee" shall have the meaning  specified in Section 9.2 of
the Trust Agreement.

         "Credit  Agreement" shall mean the Credit Agreement,  dated on or about
the Initial Closing Date, among the Lessor and the Bank.

         "Credit  Agreement  Default"  shall mean any event or condition  which,
with the lapse of time or the  giving of notice,  or both,  would  constitute  a
Credit Agreement Event of Default.

         "Credit  Agreement  Event of Default" shall mean any event or condition
defined as an "Event of Default" in Section 6 of the Credit Agreement.

         "Credit Documents" shall mean the Participation  Agreement,  the Credit
Agreement, the Notes and the Security Documents.

         "Credit Parties" shall mean the Construction Agent, the Lessee and each
Guarantor.

         "Deed"  shall  mean  a  warranty   deed   regarding   the  Land  and/or
Improvements in form and substance satisfactory to the Bank.

         "Default"  shall mean any event,  act or condition which with notice or
lapse of time, or both, would constitute an Event of Default.


                                   Appendix-9
<PAGE>


         "Deficiency Balance" shall have the meaning given in Section 22.1(b) of
the Lease Agreement.

         "Disputes" shall have the meaning given to such term in Section 12.7(d)
of the Participation Agreement.

         "Documents"  shall have the meaning  given to such term in Section 1 of
the Security Agreement.

         "Dollars"  and "$" shall mean dollars in lawful  currency of the United
States of America.

         "Dollar  Tree" shall mean Dollar Tree  Distribution,  Inc.,  a Virginia
corporation, and its successors and permitted assignees.

         "Domestic  Subsidiary"  shall mean,  with  respect to any  Person,  any
Subsidiary of such Person which is  incorporated  or organized under the laws of
any State of the United States or the District of Columbia.

         "DTS" shall mean Dollar Tree Stores, Inc., a Virginia corporation,  and
its successors and permitted assigns.

         "DTSD  Realty  Trust  1999-1"  shall  mean the  grantor  trust  created
pursuant to the terms and conditions of the Trust Agreement.

         "Election  Date" shall have the  meaning  given to such term in Section
20.1 of the Lease.

         "Election  Notice" shall have the meaning given to such term in Section
20.1 of the Lease.

         "Employee  Benefit Plan" or "Plan" shall mean an employee  benefit plan
(within the meaning of Section 3(3) of ERISA,  including without  limitation any
Multiemployer  Plan), or any "plan" as defined in Section 4975(e)(1) of the Code
and as interpreted by the Internal  Revenue  Service and the Department of Labor
in rules, regulations, releases or bulletins in effect on any Closing Date.

         "Environmental Claims" shall mean any investigation, notice, violation,
demand, allegation,  action, suit, injunction,  judgment, order, consent decree,
penalty, fine, lien, proceeding, or claim (whether administrative,  judicial, or
private in nature) arising (a) pursuant to, or in connection  with, an actual or
alleged  violation  of,  any  Environmental  Law,  (b) in  connection  with  any
Hazardous Substance, (c) from any abatement,  removal, remedial,  corrective, or
other response  action in connection with a Hazardous  Substance,  Environmental
Law,  or other  order of a Tribunal  or (d) from any  actual or alleged  damage,
injury,  threat,  or  harm  to  health,   safety,  natural  resources,   or  the
environment.


                                  Appendix-10
<PAGE>


         "Environmental  Laws" shall mean any Law,  permit,  consent,  approval,
license,  award, or other  authorization or requirement of any Tribunal relating
to  emissions,  discharges,  releases,  threatened  releases  of  any  Hazardous
Substance  into  ambient  air,  surface  water,  ground  water,  publicly  owned
treatment works,  septic system, or land, or otherwise relating to the handling,
storage,  treatment,  generation,  use,  or disposal  of  Hazardous  Substances,
pollution or to the protection of health or the environment,  including  without
limitation  CERCLA,  the Resource  Conservation  and Recovery Act, 42 U.S.C. ss.
6901, et seq., and state statutes analogous thereto.

         "Environmental  Violation"  shall  mean  any  activity,  occurrence  or
condition that violates or threatens (if the threat requires  remediation  under
any  Environmental  Law and is not  remediated  during any grace period  allowed
under such  Environmental  Law) to violate  or results in or  threatens  (if the
threat requires  remediation  under any  Environmental Law and is not remediated
during  any grace  period  allowed  under such  Environmental  Law) to result in
noncompliance with any Environmental Law.

         "Equipment"  shall  mean  personal  property  of every  kind and nature
whatsoever  purchased,  leased or otherwise  acquired  using the proceeds of the
Loans or the Holder Advances by the Construction Agent, the Lessee or the Lessor
and all improvements and modifications thereto and replacements thereof, whether
or not now owned or  hereafter  acquired  or now or  subsequently  attached  to,
contained in or used or usable in any way in  connection  with any  operation of
any Improvements.

         "Equipment Schedule" shall mean (a) each Equipment Schedule attached to
the  applicable  Requisition  and (b) each  Equipment  Schedule  attached to the
applicable Lease Supplement.

         "ERISA" shall mean the Employee Retirement Income Security Act of 1974,
as amended.

         "ERISA Affiliate" shall mean each entity required to be aggregated with
the Lessee pursuant to the requirements of Section 414(b) or (c) of the Code.

         "Eurocurrency  Reserve  Requirements" shall mean for any day as applied
to a Eurodollar Loan, the aggregate  (without  duplication) of the maximum rates
(expressed  as a  decimal)  of  reserve  requirements  in  effect  on  such  day
(including  without  limitation  basic,  supplemental,  marginal  and  emergency
reserves  under any  regulations  of the Board or other  Governmental  Authority
having  jurisdiction  with respect  thereto)  dealing with reserve  requirements
prescribed  on  eurocurrency  funding  (currently  referred to as  "Eurocurrency
liabilities" in Regulation D) maintained by a member bank of the Federal Reserve
System.

         "Eurodollar  Holder  Advance"  shall  mean a Holder  Advance  bearing a
Holder Yield based on the Eurodollar Rate.

         "Eurodollar Loans" shall mean Loans the rate of interest  applicable to
which is based upon the Eurodollar Rate.


                                  Appendix-11

<PAGE>

         "Eurodollar   Rate"  shall  mean  for  the  Interest  Period  for  each
Eurodollar  Loan or  Eurodollar  Holder  Advance  comprising  part  of the  same
borrowing or advance (including without limitation  conversions,  extensions and
renewals),  a per annum interest rate equal to the per annum rate  determined by
the Bank on the basis of the offered  rates for deposits in dollars for a period
of time  corresponding  to such Interest Period (and commencing on the first day
of such  Interest  Period),  reported  on  Telerate  page 3750 as of 11:00  a.m.
(London  time) two (2)  Business  Days  before  the  first day of such  Interest
Period.  In the event no such  offered  rates  appear  on  Telerate  page  3750,
"Eurodollar Rate" shall mean for the Interest Period for each Eurodollar Loan or
Eurodollar  Holder  Advance  comprising  part of the same  borrowing  or advance
(including without limitation conversions, extensions and renewals), a per annum
interest rate equal to the per annum rate determined by the Bank on the basis of
the offered rates for deposits in dollars for a period of time  corresponding to
such Interest Period (and commencing on the first day of such Interest  Period),
which appear on the Reuters Screen LIBO Page as of 11:00 a.m.  (London time) two
(2) Business Days before the first day of such Interest Period (provided that if
at least two (2) such offered rates appear on the Reuters  Screen LIBO Page, the
rate in respect of such  Interest  Period  will be the  arithmetic  mean of such
offered  rates).  As used herein,  "Reuters  Screen LIBO Page" means the display
designated  as page "LIBO" on the Reuters  Monitor  Money Rates Service (or such
other  page as may  replace  the LIBO page on that  service  for the  purpose of
displaying  London  interbank  offered rates of major banks)  ("RMMRS").  In the
event the RMMRS is not then quoting such offered rates,  "Eurodollar Rate" shall
mean for the  Interest  Period for each  Eurodollar  Loan or  Eurodollar  Holder
Advance  comprising  part of the same  borrowing or advance  (including  without
limitation conversions, extensions and renewals), the average (rounded upward to
the nearest one-sixteenth (1/16) of one percent (1%)) per annum rate of interest
determined by the Bank (each such determination to be conclusive and binding) as
of two (2) Business Days prior to the first day of such Interest Period,  as the
effective rate at which deposits in immediately  available funds in U.S. dollars
are being,  have been,  or would be offered or quoted by the Bank to major banks
in the applicable  interbank  market for Eurodollar  deposits at any time during
the Business  Day which is the second  Business Day  immediately  preceding  the
first day of such Interest Period, for a term comparable to such Interest Period
and in the amount of the  requested  Eurodollar  Loan and/or  Eurodollar  Holder
Advance.  If no such offers or quotes are  generally  available for such amount,
then the Bank shall be entitled to determine  the  Eurodollar  Rate from another
recognized  service or interbank  quotation,  or by estimating in its reasonable
judgment the per annum rate (as  described  above) that would be  applicable  if
such quote or offers were generally available.

         "Event of  Default"  shall  mean a Lease  Event of  Default,  an Agency
Agreement Event of Default or a Credit Agreement Event of Default.


                                  Appendix-12

<PAGE>

         "Excepted Payments" shall mean:

                  (a)  all  indemnity  payments  (including  without  limitation
         indemnity  payments  made  pursuant to Section 11 of the  Participation
         Agreement),  whether made by adjustment to Basic Rent or otherwise,  to
         which the Owner Trustee, or any of its respective  Affiliates,  agents,
         officers, directors or employees is entitled;

                  (b) any amounts (other than Basic Rent or  Termination  Value)
         payable under any Operative  Agreement to reimburse the Owner  Trustee,
         or any of its Affiliates  (including  without limitation the reasonable
         expenses  of the Owner  Trustee or the Trust  Company  and  incurred in
         connection  with any such payment) for performing or complying with any
         of the  obligations  of  the  Lessee  under  and  as  permitted  by any
         Operative Agreement;

                  (c) any insurance  proceeds (or payments with respect to risks
         self-insured or policy deductibles) under liability policies other than
         such proceeds or payments payable to the Bank;

                  (d) any insurance proceeds  under policies  maintained by  the
         Owner Trustee or the Bank;

                  (e) Transaction Expenses or other amounts, fees, disbursements
         or expenses paid or payable to or for the benefit of the Owner Trustee;

                  (f) all right,  title and interest of the Owner Trustee to any
         Property or any portion thereof or any other property to the extent any
         of the  foregoing  has been  released  from the  Liens of the  Security
         Documents and the Lease pursuant to the terms thereof;

                  (g) upon termination of the Credit  Agreement  pursuant to the
         terms thereof,  all remaining property covered by the Lease or Security
         Documents;

                  (h)  any  payments  in  respect  of  interest  to  the  extent
         attributable to payments  referred to in clauses (a) through (g) above;
         and

                  (i) any  rights  of  either  the  Owner  Trustee  or the Trust
         Company to demand,  collect,  sue for or otherwise  receive and enforce
         payment of any of the  foregoing  amounts,  provided  that such  rights
         shall not include the right to terminate the Lease.

         "Excess  Proceeds"  shall mean the excess,  if any, of the aggregate of
all awards,  compensation  or insurance  proceeds  payable in connection  with a
Casualty or Condemnation  over the Termination Value paid by the Lessee pursuant
to the Lease with respect to such Casualty or Condemnation.

         "Exculpated  Persons" shall mean the Trust Company (except with respect
to the  representations  and warranties  and the other  obligations of the Trust
Company  pursuant  to  the


                                  Appendix-13

<PAGE>

Operative Agreements expressly undertaken in its individual capacity,  including
without  limitation  the  representations  and  warranties  of the Trust Company
pursuant to Section 6.1 of the Participation  Agreement,  the obligations of the
Trust  Company  pursuant to Section 8.2 of the  Participation  Agreement and the
obligations  of the Trust  Company  pursuant to the Trust  Agreement),  the Bank
(except  with  respect  to the  obligations  of the  Bank  expressly  undertaken
pursuant to the Participation Agreement and the Trust Agreement, their officers,
directors, shareholders and partners.

         "Exempt  Payments" shall have the meaning  specified in Section 11.2(e)
of the Participation Agreement.

         "Expiration Date" shall mean the last day of the Term; provided,  in no
event shall the  Expiration  Date be later than the fifth annual  anniversary of
the Initial Closing Date, unless such later date has been expressly agreed to in
writing by each of the Lessor, the Lessee and the Bank.

         "Fair Market Sales Value" shall mean, with respect to any Property, the
amount,  which in any event, shall not be less than zero (0), that would be paid
in cash in an arms-length  transaction between an informed and willing purchaser
and an informed and willing  seller,  neither of whom is under any compulsion to
purchase or sell,  respectively,  such Property.  Fair Market Sales Value of any
Property shall be determined based on the assumption  that,  except for purposes
of Section 17 of the  Lease,  such  Property  is in the  condition  and state of
repair  required under Section 10.1 of the Lease and the Lessee is in compliance
with the other requirements of the Operative Agreements.

         "Federal  Funds  Effective  Rate" shall have the meaning  given to such
term in the definition of ABR.

         "Financing  Parties" shall mean the Lessor,  the Owner Trustee,  in its
trust capacity,  the Bank, as Holder and Lender, and their respective successors
and assigns.

         "First Union" shall mean First Union National Bank, a national  banking
association, and its permitted successors and assigns.

         "Fixtures"  shall  mean  all  fixtures  relating  to the  Improvements,
including  without  limitation  all  components  thereof,  located  in or on the
Improvements,  together with all  replacements,  modifications,  alterations and
additions thereto.

         "Force  Majeure  Event"  shall mean any event beyond the control of the
Construction  Agent,  other than a Casualty or Condemnation,  including  without
limitation  strikes,  lockouts,  adverse soil  conditions,  acts of God, adverse
weather  conditions,  inability  to  obtain  labor  or  materials,  governmental
activities,  civil commotion and enemy action; but excluding any event, cause or
condition that results from the Construction Agent's financial condition.

         "GAAP" shall mean generally accepted accounting principles set forth in
the  opinions  and  pronouncements  of the  accounting  principles  board of the
American  Institute  of  Certified


                                  Appendix-14

<PAGE>

Public   Accountants,   and  statements  and  pronouncements  of  the  Financial
Accounting  Standards Board or in such other  statements by such other entity as
may be approved by a significant segment of the accounting profession,  that are
applicable to the circumstances as of the date of determination.

         "Governmental   Action"   shall  mean  all   permits,   authorizations,
registrations,  consents,  approvals,  waivers,  exceptions,  variances, orders,
judgments, written interpretations, decrees, licenses, exemptions, publications,
filings,   notices  to  and  declarations  of  or  with,  or  required  by,  any
Governmental Authority, or required by any Legal Requirement, and shall include,
without  limitation,  all  environmental and operating permits and licenses that
are required for the full use, occupancy, zoning and operating of the Property.

         "Governmental Authority" shall mean any nation or government, any state
or other  political  subdivision  thereof and any entity  exercising  executive,
legislative,  judicial,  regulatory or administrative functions of or pertaining
to government.

         "Ground  Lease"  shall  mean a ground  lease  (in  form  and  substance
satisfactory to the Agent) respecting any Property (a) owned by the Lessee (or a
parent  corporation  or any  Subsidiary  of the Lessee) and leased to the Lessor
where such lease has at least a  ninety-nine  (99) year term and payments set at
no more than  $1.00 per year,  or (b) where  such lease is subject to such other
terms and conditions as are satisfactory to the Bank.

         "Guarantors"  shall  mean  the  various  parties  to the  Participation
Agreement  from time to time, as guarantors  of the  Construction  Agent and the
Lessee with respect to the Operative Agreements and the Properties.

         "Hard Costs" shall mean all costs and  expenses  payable for  supplies,
materials,  labor  and  profit  with  respect  to  the  Improvements  under  any
Construction Contract.

         "Hazardous  Substance"  shall  mean  any  of  the  following:  (a)  any
petroleum or petroleum product,  explosives,  radioactive  materials,  asbestos,
formaldehyde,  polychlorinated biphenyls, lead and radon gas; (b) any substance,
material,  product,  derivative,  compound or mixture, mineral, chemical, waste,
gas,  medical waste,  or pollutant,  in each case whether  naturally  occurring,
man-made or the by-product of any process,  that is toxic,  harmful or hazardous
to the  environment  or human health or safety as determined in accordance  with
any  Environmental  Law; or (c) any substance,  material,  product,  derivative,
compound or mixture,  mineral,  chemical, waste, gas, medical waste or pollutant
that would  support  the  assertion  of any claim under any  Environmental  Law,
whether or not defined as hazardous as such under any Environmental Law.

         "Holder" shall mean the Bank as the holder of one or more  Certificates
in connection with the DTSD Realty Trust 1999-1.

         "Holder  Advance"  shall mean any advance made by the Bank to the Owner
Trustee  pursuant  to the  terms of the  Trust  Agreement  or the  Participation
Agreement.


                                  Appendix-15
<PAGE>


         "Holder  Amount"  shall mean as of any date,  the  aggregate  amount of
Holder  Advances  made by the Bank to the Trust Estate  pursuant to Section 2 of
the  Participation  Agreement  and Section 3.1 of the Trust  Agreement  less any
payments of any Holder Advances  received by the Bank pursuant to Section 3.4 of
the Trust Agreement.

         "Holder  Commitments"  shall  mean  $540,000,  as  such  amount  may be
increased or reduced from time to time in accordance  with the provisions of the
Operative Agreements.

         "Holder  Construction  Property Cost" shall mean,  with respect to each
Construction Period Property,  at any date of determination,  an amount equal to
the  outstanding  Holder  Advances  made with  respect  thereto  under the Trust
Agreement.

         "Holder  Overdue  Rate"  shall mean the lesser of (a) the then  current
rate of Holder  Yield  respecting  the  particular  amount in question  plus two
percent (2%) and (b) the highest rate permitted by applicable law.

         "Holder  Property Cost" shall mean with respect to a Property an amount
equal to the outstanding Holder Advances with respect thereto.

         "Holder Yield" shall mean with respect to Holder  Advances from time to
time either the Eurodollar  Rate plus the  Applicable  Percentage for Eurodollar
Holder  Advances  or the ABR  plus  the  Applicable  Percentage  for ABR  Holder
Advances as elected by the Owner  Trustee from time to time with respect to such
Holder Advances in accordance with the terms of the Trust  Agreement;  provided,
however,  (a) the  outstanding  Holder  Advances  shall  bear a yield at the ABR
applicable  from time to time from and after the dates and  during  the  periods
specified in Section 3.7(c) of the Trust Agreement,  and (b) the Holder Advances
shall bear a yield at the ABR  applicable  from time to time after the dates and
during the periods specified in Section 11.3(f) of the Participation Agreement.

         "Impositions"  shall mean any and all  liabilities,  losses,  expenses,
costs,  charges  and  Liens of any kind  whatsoever  for  fees,  taxes,  levies,
imposts,  duties,  charges,  assessments or withholdings ("Taxes") including but
not  limited  to  (i)  real  and  personal  property  taxes,  including  without
limitation  personal property taxes on any property covered by the Lease that is
classified by Governmental  Authorities as personal property, and real estate or
ad valorem taxes in the nature of property  taxes;  (ii) sales taxes,  use taxes
and other similar taxes  (including  rent taxes and  intangibles  taxes);  (iii)
excise taxes; (iv) real estate transfer taxes, conveyance taxes, stamp taxes and
documentary recording taxes and fees; (v) taxes that are or are in the nature of
franchise,  income, value added, privilege and doing business taxes, license and
registration   fees;  (vi)  assessments  on  any  Property,   including  without
limitation all assessments for public  Improvements or benefits,  whether or not
such  improvements  are commenced or completed within the Term; and (vii) taxes,
Liens,  assessments or charges asserted,  imposed or assessed by the PBGC or any
governmental  authority  succeeding to or performing  functions  similar to, the
PBGC;  and in each case all interest,  additions to tax and  penalties  thereon,
which at any time prior to,  during or with respect to the Term or in respect of
any period for which the Lessee shall


                                  Appendix-16

<PAGE>

be obligated to pay Supplemental Rent, may be levied, assessed or imposed by any
Governmental  Authority  upon or with  respect to (a) any  Property  or any part
thereof  or  interest  therein;   (b)  the  leasing,   financing,   refinancing,
demolition,   construction,   substitution,   subleasing,  assignment,  control,
condition, occupancy,  servicing,  maintenance,  repair, ownership,  possession,
activity conducted on, delivery,  insuring, use, operation,  improvement,  sale,
transfer  of title,  return or other  disposition  of such  Property or any part
thereof or interest therein;  (c) the Notes,  other indebtedness with respect to
any Property, or the Certificates,  or any part thereof or interest therein; (d)
the rentals,  receipts or earnings arising from any Property or any part thereof
or interest therein; (e) the Operative  Agreements,  the performance thereof, or
any payment made or accrued pursuant  thereto;  (f) the income or other proceeds
received  with respect to any  Property or any part thereof or interest  therein
upon the sale or  disposition  thereof;  (g) any contract  (including the Agency
Agreement)  relating  to  the  construction,  acquisition  or  delivery  of  the
Improvements  or any part thereof or interest  therein;  (h) the issuance of the
Notes or the Certificates; (i) the Owner Trustee, the Trust or the Trust Estate;
or (j)  otherwise  in  connection  with  the  transactions  contemplated  by the
Operative Agreements.

         "Improvements"   shall  mean,   with   respect  to  the   construction,
renovations  and/or  Modifications  on  any  Land,  all  buildings,  structures,
Fixtures,  and other  improvements  of every kind  existing at any time and from
time to time on or under the Land  purchased  or  otherwise  acquired  using the
proceeds  of the Loans or the  Holder  Advances  or which is subject to a Ground
Lease, together with any and all appurtenances to such buildings,  structures or
improvements,  including without limitation  sidewalks,  utility pipes, conduits
and lines,  parking areas and roadways,  and including  without  limitation  all
Modifications and other additions to or changes in the Improvements at any time,
including  without  limitation (a) any Improvements  existing as of the Property
Closing  Date  as  such   Improvements  may  be  referenced  on  the  applicable
Requisition and (b) any  Improvements  made subsequent to such Property  Closing
Date.

         "Incorporated  Covenants"  shall have the meaning given to such term in
Section 28.1 of the Lease.

         "Incorporated  Representations  and Warranties"  shall have the meaning
given to such term in Section 28.1 of the Lease.

         "Indebtedness"  of  a  Person  shall  mean,  without  duplication, such
Person's:

                  (a)  obligations for borrowed money;

                  (b)  obligations representing  the deferred  purchase price of
         Property  (whether real,  personal,  tangible,  intangible or mixed) or
         services (other than accounts payable arising in the ordinary course of
         such Person's business payable on terms customary in the trade);

                  (c)  obligations, whether or not assumed,  secured by liens or
         payable  out  of  the  proceeds  or  production  from  property  now or
         hereafter owned or acquired by such Person;


Appendix-17
<PAGE>


                  (d)  obligations which  are evidenced by notes, acceptances or
         other instruments;

                  (e)  Capitalized Lease obligations;

                  (f)  net liabilities under interest rate swap, exchange or cap
         agreements; and

                  (g)  contingent obligations.

         "Indemnified  Person" shall mean the Lessor, the Owner Trustee,  in its
individual and its trust capacity,  the Trust,  the Trust Company,  the Bank and
their  respective  successors,  assigns,  directors,   shareholders,   partners,
officers, employees, agents and Affiliates.

         "Indemnity Provider" shall mean, respecting each Property, the Lessee.

         "Initial Closing Date" shall mean June 4, 1999.

         "Initial  Construction  Advance" shall mean any initial  Advance to pay
for:  (a)  Property  Costs for  construction  of any  Improvements;  and (b) the
Property  Costs of restoring or repairing  any Property  which is required to be
restored or repaired in accordance with Section 15.1(c) of the Lease.

         "Instruments" shall have the meaning given to such term in Section 1 of
the Security Agreement.

         "Insurance  Requirements"  shall mean all terms and  conditions  of any
insurance  policy either required by the Lease to be maintained by the Lessee or
required by the Agency Agreement to be maintained by the Construction Agent, and
all requirements of the issuer of any such policy and, regarding self insurance,
any other requirements of the Lessee.

         "Interest   Period"  shall  mean  during  the  Commitment   Period  and
thereafter  as to any  Eurodollar  Loan or  Eurodollar  Holder  Advance (i) with
respect to the initial Interest Period,  the period beginning on the date of the
first  Eurodollar  Loan and Eurodollar  Holder Advance and ending one (1) month,
two (2) months,  three (3) months or six (6) months  thereafter,  as selected by
the Lessor (in the case of a Eurodollar  Loan) or the Owner Trustee (in the case
of a  Eurodollar  Holder  Advance) in its  applicable  notice given with respect
thereto and (ii) thereafter,  each period commencing on the last day of the next
preceding  Interest  Period  applicable  to such  Eurodollar  Loan or Eurodollar
Holder Advance and ending one (1) month, two (2) months, three (3) months or six
(6) months  thereafter,  as selected by the Lessor by irrevocable  notice to the
Bank (in the case of a Eurodollar  Loan) or by the Owner Trustee (in the case of
a Eurodollar  Holder  Advance) in each case not less than two (2) Business  Days
prior to the last day of the then current  Interest Period with respect thereto;
provided,  however,  that all of the foregoing  provisions  relating to Interest
Periods are subject to the following:  (A) if any Interest Period would end on a
day which is not a Business Day,  such Interest  Period shall be extended to the


                                  Appendix-18

<PAGE>

next succeeding Business Day (except that where the next succeeding Business Day
falls in the next succeeding calendar month, then on the next preceding Business
Day),  (B) no Interest  Period  shall  extend  beyond the  Maturity  Date or the
Expiration  Date,  as the case may be, (C) where an Interest  Period begins on a
day for which there is no numerically corresponding day in the calendar month in
which the Interest  Period is to end, such Interest Period shall end on the last
Business Day of such calendar  month,  (D) there shall not be more than four (4)
Interest Periods outstanding at any one (1) time.

         "Investment Company Act" shall mean the Investment Company Act of 1940,
as amended, together with the rules and regulations promulgated thereunder.

         "Joinder  Agreement"  shall  mean a joinder  agreement,  in the form of
EXHIBIT J to the Participation  Agreement,  executed from time to time between a
Domestic Subsidiary of any Credit Party and Bank.

         "Land"  shall  mean a  parcel  of real  property  described  on (a) the
Requisition  issued  by the  Construction  Agent on the  Property  Closing  Date
relating to such parcel and (b) the schedule to each applicable Lease Supplement
executed and delivered in accordance with the requirements of Section 2.4 of the
Lease.

         "Land  Cost"  shall have the  meaning  specified  in Section 5.4 of the
Agency Agreement.

         "Law"  shall  mean  any  statute,  law,  ordinance,  regulation,  rule,
directive, order, writ, injunction or decree of any Tribunal.

         "Lease" or "Lease Agreement" shall mean the Lease Agreement dated on or
about the Initial Closing Date, between the Lessor and the Lessee, together with
any Lease Supplements thereto.

         "Lease Default" shall mean any event or condition which, with the lapse
of time or the giving of notice,  or both,  would  constitute  a Lease  Event of
Default.

         "Lease  Event of Default"  shall have the meaning  specified in Section
17.1 of the Lease.

         "Lease  Supplement"  shall mean each Lease Supplement  substantially in
the form of Exhibit A to the Lease,  together with all attachments and schedules
thereto.

         "Legal  Requirements" shall mean all foreign,  federal,  state, county,
municipal and other governmental  statutes,  laws, rules,  orders,  regulations,
ordinances,  judgments, decrees and injunctions affecting the Owner Trustee, the
Lessor, the Lessee, the Bank or any Property,  Land,  Improvement,  Equipment or
the taxation, demolition,  construction, use or alteration of such Improvements,
whether now or hereafter enacted and in force,  including without limitation any
that require  repairs,  modifications or alterations in or to any Property or in
any way limit the use and enjoyment thereof  (including  without  limitation all
building, zoning and fire codes and the Americans with Disabilities Act of 1990,
42 U.S.C. ss. 12101 et. seq., and any other similar


                                  Appendix-19

<PAGE>

federal,  state or local  laws or  ordinances  and the  regulations  promulgated
thereunder)  and any that may relate to  environmental  requirements  (including
without  limitation all  Environmental  Laws), and all permits,  certificates of
occupancy,  licenses,  authorizations and regulations  relating thereto, and all
covenants,   agreements,   restrictions  and   encumbrances   contained  in  any
instruments  which are  either of record or known to the  Lessee  affecting  any
Property or the Appurtenant Rights.

         "Lender  Commitment"  shall  mean  $17,460,000,  as such  amount may be
increased or reduced from time to time in accordance  with the provisions of the
Operative Agreements.

         "Lender Financing  Statements" shall mean UCC financing  statements and
fixture  filings  appropriately   completed  and  executed  for  filing  in  the
applicable  jurisdiction in order to procure a security interest in favor of the
Bank in the Collateral subject to the Security Documents.

         "Lender"  shall  mean  the  Bank  as  lender  under  the  Participation
Agreement and the Credit Agreement.

         "Lessee" shall have the meaning set forth in the Lease.

         "Lessee Credit  Agreement" shall mean that certain Amended and Restated
Revolving  Credit  Agreement  dated as of September 27, 1996 among the Lessee as
the  borrower,  Dollar Tree Stores,  Inc. and Dollar Tree  Management,  Inc., as
guarantors, The First National Bank of Boston,  NationsBank,  N.A., Signet Bank,
Crestar Bank,  First Union  National Bank of Virginia,  Amsouth Bank of Alabama,
Union Bank of California,  N.A., and all other financial  institutions which are
parties  thereto from time to time, as lenders,  and The First  National Bank of
Boston, as agent, as such is amended,  modified,  supplemented,  restated and/or
replaced from time to time.

         "Lessee  Credit  Agreement  Event of  Default"  shall mean an  Event of
Default as defined in Section 12 of the Lessee Credit Agreement.

         "Lessor" shall mean the Owner Trustee,  not in its individual capacity,
but as the Lessor under the Lease.

         "Lessor  Basic Rent" shall mean the  scheduled  Holder Yield due on the
Holder  Advances on any  Scheduled  Interest  Payment Date pursuant to the Trust
Agreement (but not including interest on (a) any such scheduled Holder Yield due
on the Holder Advances prior to the Rent  Commencement  Date with respect to the
Property to which such Holder  Advances  relate or (b) overdue amounts under the
Trust Agreement or otherwise).

         "Lessor Financing  Statements" shall mean UCC financing  statements and
fixture  filings  appropriately   completed  and  executed  for  filing  in  the
applicable  jurisdictions  in order to protect the Lessor's  interest  under the
Lease to the extent the Lease is a security agreement or a mortgage.


                                  Appendix-20
<PAGE>


         "Lessor  Lien"  shall  mean  any  Lien,   true  lease  or  sublease  or
disposition  of title arising as a result of (a) any claim against the Lessor or
the  Trust  Company,  in  its  individual  capacity,   not  resulting  from  the
transactions  contemplated by the Operative Agreements,  (b) any act or omission
of the Lessor or the Trust  Company,  in its individual  capacity,  which is not
required by the  Operative  Agreements or is in violation of any of the terms of
the Operative Agreements, (c) any claim against the Lessor or the Trust Company,
in its  individual  capacity,  with  respect  to Taxes or  Transaction  Expenses
against  which the Lessee is not required to  indemnify  the Lessor or the Trust
Company, in its individual capacity, pursuant to Section 11 of the Participation
Agreement or (d) any claim against the Lessor arising out of any transfer by the
Lessor of all or any portion of the  interest  of the Lessor in the  Properties,
the Trust Estate or the Operative Agreements other than the transfer of title to
or possession of any Properties by the Lessor pursuant to and in accordance with
the Lease, the Credit  Agreement,  the Security  Agreement or the  Participation
Agreement  or pursuant to the exercise of the remedies set forth in Article XVII
of the Lease.

         "Lien" shall mean any mortgage, pledge, security interest, encumbrance,
lien, option or charge of any kind.

         "Limited Recourse Amount" shall mean with respect to all the Properties
on an aggregate basis, an amount equal to the sum of the Termination Values with
respect to all the Properties on an aggregate  basis on each Payment Date,  less
the Maximum  Residual  Guarantee  Amount as of such date with respect to all the
Properties on an aggregate basis.

         "Loan Basic Rent" shall mean the scheduled interest due on the Loans on
any Scheduled  Interest  Payment Date pursuant to the Credit  Agreement (but not
including  interest on (a) any such Loan due prior to the Rent Commencement Date
with  respect  to the  Property  to which such Loan  relates or (b) any  overdue
amounts under Section 2.8(b) of the Credit Agreement or otherwise).

         "Loan Property  Cost" shall mean,  with respect to each Property at any
date of determination, an amount equal to (a) the aggregate principal amount all
Loans  (including  without  limitation all  Acquisition  Loans and  Construction
Loans) made on or prior to such date with respect to such Property minus (b) the
aggregate  amount of  prepayments  or repayments as the case may be of the Loans
allocated to reduce the Loan Property Cost of such Property  pursuant to Section
2.6(c) of the Credit Agreement.

         "Loans" shall mean the loans extended pursuant to the Credit Agreement.

         "Marketing Period" shall mean, if the Lessee has given a Sale Notice in
accordance  with Section 20.1 of the Lease,  the period  commencing  on the date
such Sale Notice is given and ending on the Expiration Date.

         "Margin  Certificate"  shall  have the  meaning  given to such  term in
Section 8.3(k) of the Participation Agreement.


                                  Appendix-21
<PAGE>


         "Material  Adverse Effect" shall, mean a material adverse effect on (a)
the  business,  condition  (financial  or  otherwise),  assets,  liabilities  or
operations of the Lessee and the other Credit Parties, taken as a whole, (b) the
ability of the Lessee to perform its respective  obligations under any Operative
Agreement  to which it is a party,  (c) the  validity or  enforceability  of any
Operative  Agreement  or the  rights  and  remedies  of the  Bank or the  Lessor
thereunder,  (d) the  validity,  priority or  enforceability  of any Lien on any
Property created by any of the Operative  Agreements,  or (e) the value, utility
or useful life of any  Property or the use, or ability of the Lessee to use, any
Property for the purpose for which it was intended.

         "Maturity Date" shall mean the Expiration Date.

         "Maximum  Residual  Guarantee Amount" shall mean an amount equal to the
product of the aggregate  Property Cost for all of Properties times  eighty-five
percent (85%).

         "Modifications" shall have the meaning specified  in Section 11.1(a) of
the Lease.

         "Mortgage  Instrument"  shall mean any  mortgage,  deed of trust or any
other instrument  executed by the Owner Trustee and the Lessee (or regarding any
Property subject to a Ground Lease,  the applicable  Affiliate of the Lessee) in
favor of the Bank) and evidencing a Lien on the Property,  in form and substance
reasonably acceptable to the Bank.

         "Multiemployer   Plan"  shall  mean  any  plan   described  in  Section
4001(a)(3) of ERISA to which  contributions are or have been made or required by
the Lessee or any of its Subsidiaries or ERISA Affiliates.

         "Multiple  Employer  Plan" shall mean a plan to which the Lessee or any
ERISA  Affiliate  and at  least  one (1)  other  employer  other  than an  ERISA
Affiliate is making or accruing an obligation to make, or has made or accrued an
obligation to make, contributions.

         "New  Facility"  shall have the  meaning  given to such term in Section
28.1 of the Lease.

         "Notes"  shall  mean those  notes  issued to the Bank  pursuant  to the
Credit Agreement.

         "Obligations" shall have the meaning given to such term in Section 1 of
the Security Agreement.

         "Officer's  Certificate"  with  respect  to  any  person  shall  mean a
certificate  executed on behalf of such person by a Responsible  Officer who has
made or caused to be made such  examination or  investigation as is necessary to
enable such  Responsible  Officer to express an informed opinion with respect to
the subject matter of such Officer's Certificate.

         "Officer's Compliance Certificate" shall have the meaning given to such
term in Section 8.3(k) of the Participation Agreement.


                                  Appendix-22
<PAGE>


         "Operative  Agreements"  shall mean the  following:  the  Participation
Agreement,  the Agency Agreement,  the Trust Agreement,  the  Certificates,  the
Credit Agreement,  the Notes, the Lease, the Lease Supplements (and memoranda of
the Lease and each  Lease  Supplement  in a form  reasonably  acceptable  to the
Agent), the Security  Agreement,  the Mortgage  Instruments,  the other Security
Documents,  the Ground  Leases,  the Deeds and the Bills of Sale and any and all
other agreements,  documents and instruments  executed in connection with any of
the foregoing.

         "Original Executed  Counterpart"  shall have the meaning  given to such
term in Section 5 of EXHIBIT A to the Lease.

         "Overdue  Interest" shall mean any interest payable pursuant to Section
2.8(b) of the Credit Agreement.

         "Overdue  Rate" shall mean (a) with respect to the Loan Basic Rent, and
any other  amount  owed under or with  respect to the  Credit  Agreement  or the
Security  Documents,  the  rate  specified  in  Section  2.8(b)  of  the  Credit
Agreement,  (b) with respect to the Lessor Basic Rent,  the Holder Yield and any
other  amount  owed  under or with  respect to the Trust  Agreement,  the Holder
Overdue Rate, and (c) with respect to any other amount,  the amount  referred to
in clause (y) of Section 2.8(b) of the Credit Agreement.

         "Owner Trustee," "Borrower" or "Lessor" shall mean First Security Bank,
National  Association,  not  individually,  except  as  expressly  stated in the
various  Operative  Agreements,  but solely as the Owner  Trustee under the DTSD
Realty Trust 1999-1,  and any successor,  replacement  and/or  additional  Owner
Trustee expressly permitted under the Operative Agreements.

         "Participation  Agreement" shall mean the Participation Agreement dated
on or about the Initial  Closing Date,  among the Lessee,  the  Guarantors,  the
Owner  Trustee,  not in its  individual  capacity  except  as  expressly  stated
therein, and the Bank.

         "Payment Date" shall mean any Scheduled  Interest  Payment Date and any
date on which  interest  or Holder  Yield in  connection  with a  prepayment  of
principal  on the  Loans or of the  Holder  Advances  is due  under  the  Credit
Agreement or the Trust Agreement.

         "PBGC" shall mean the Pension Benefit Guaranty  Corporation  created by
Section 4002(a) of ERISA or any successor thereto.

         "Pension Plan" shall mean a "pension  plan", as such term is defined in
section  3(2) of ERISA,  which is  subject  to title IV of ERISA  (other  than a
Multiemployer Plan), and to which the Lessee or any ERISA Affiliate may have any
liability, including without limitation any liability by reason of having been a
substantial  employer  within the  meaning of section  4063 of ERISA at any time
during  the  preceding  five (5)  years,  or by reason  of being  deemed to be a
contributing sponsor under section 4069 of ERISA.

         "Permitted Facility" shall mean a Property approved by the Bank.


                                  Appendix-23
<PAGE>


         "Permitted Liens" shall mean:

                  (a)  the respective rights and interests of the parties to the
         Operative Agreements as provided in the Operative Agreements;

                  (b)  the rights of any sublessee or assignee  under a sublease
         or an assignment  expressly  permitted by the terms of the Lease for no
         longer than the duration of the Lease;

                  (c)  Liens for Taxes  that either are not yet due or are being
         contested  in  accordance  with the  provisions  of Section 13.1 of the
         Lease;

                  (d)  Liens   arising  by  operation  of  law,   materialmen's,
         mechanics',    workmen's,    repairmen's,     employees',    carriers',
         warehousemen's and other like Liens relating to the construction of the
         Improvements or in connection with any  Modifications or arising in the
         ordinary  course of business  for amounts that either are not more than
         thirty  (30) days past due or are being  diligently  contested  in good
         faith by appropriate  proceedings,  so long as such proceedings satisfy
         the conditions for the continuation of proceedings to contest Taxes set
         forth in Section 13.1 of the Lease;

                  (e) Liens of any of the types  referred to in clause (d) above
         that have been  bonded for not less than the full amount in dispute (or
         as to which other security arrangements  satisfactory to the Lessor and
         the Bank have been made), which bonding (or arrangements)  shall comply
         with applicable Legal  Requirements,  and shall have effectively stayed
         any execution or enforcement of such Liens;

                  (f) Liens  arising out of  judgments or awards with respect to
         which appeals or other  proceedings for review are being  prosecuted in
         good faith and for the  payment of which  adequate  reserves  have been
         provided as required by GAAP or other appropriate  provisions have been
         made,  so long as such  proceedings  have the  effect  of  staying  the
         execution of such  judgments or awards and satisfy the  conditions  for
         the  continuation  of proceedings to contest Taxes set forth in Section
         13.1 of the Lease; and

                  (g) Liens in favor of  municipalities  to the extent agreed to
by the Lessor.

         "Person" shall mean any individual,  corporation,  partnership, limited
liability  company,  joint venture,  association,  joint stock  company,  trust,
unincorporated organization, governmental authority or any other entity.

         "Plans and  Specifications"  shall mean, with respect to  Improvements,
the plans and  specifications for such Improvements to be constructed or already
existing,  as  such  Plans  and  Specifications  may  be  amended,  modified  or
supplemented  from time to time in  accordance  with the terms of the  Operative
Agreements.


                                  Appendix-24
<PAGE>


         "Prime  Lending  Rate" shall have the meaning given to such term in the
definition of ABR.

         "Property" shall mean, with respect to each Permitted  Facility that is
(or is to be) acquired,  constructed  and/or renovated  pursuant to the terms of
the  Operative  Agreements,  the Land and each item of Equipment and the various
Improvements,  in each case located on such Land,  including without  limitation
each Construction  Period Property,  each Property subject to a Ground Lease and
each Property for which the Term has commenced.

         "Property  Acquisition  Cost"  shall  mean  the cost to the  Lessor  to
purchase a Property on a Property Closing Date.

         "Property  Closing  Date"  shall  mean  the date on  which  the  Lessor
purchases a Property  or, with respect to the first  Advance,  the date on which
the Lessor seeks reimbursement for Property previously purchased by the Lessor.

         "Property  Cost" shall mean with  respect to a Property  the  aggregate
amount (and/or the various items and occurrences giving rise to such amounts) of
the Loan Property Cost plus the Holder  Property Cost for such Property (as such
amounts shall be increased  equally among all  Properties  respecting the Holder
Advances  and the Loans  extended  from time to time to pay for the  Transaction
Expenses,  fees, expenses and other  disbursements  referenced in Section 7.1 of
the Participation Agreement).

         "Purchase  Option" shall have the meaning given to such term in Section
20.1 of the Lease.

         "Purchasing  Lender"  shall  have the  meaning  given  to such  term in
Section 9.8(a) of the Credit Agreement.

         "Regulation D" shall mean Regulation D of the Board of Governors of the
Federal  Reserve  System (or any  successor),  as the same may be  modified  and
supplemented and in effect from time to time.

         "Release"  shall  mean  any  release,   pumping,   pouring,   emptying,
injecting,  escaping,  leaching, dumping, seepage, spill, leak, flow, discharge,
disposal or emission of a Hazardous Substance.

         "Rent" shall mean,  collectively,  the Basic Rent and the  Supplemental
Rent, in each case payable under the Lease.

         "Rent  Commencement  Date" shall mean,  regarding  each  Property,  the
Completion Date.

         "Reportable Event" shall have the meaning specified in ERISA.


                                  Appendix-25

<PAGE>


         "Requested  Funds" shall mean any funds  requested by the Lessee or the
Construction  Agent,  as  applicable,  in  accordance  with  Section  5  of  the
Participation Agreement.

         "Requisition" shall have  the meaning specified  in Section  4.2 of the
Participation Agreement.

         "Responsible  Officer"  shall mean the Chairman or Vice Chairman of the
Board of Directors,  the Chairman or Vice Chairman of the Executive Committee of
the Board of Directors,  the  President,  any Senior Vice President or Executive
Vice President,  any Vice President, the Secretary, any Assistant Secretary, the
Treasurer, or any Assistant Treasurer, except that when used with respect to the
Trust Company or the Owner Trustee, "Responsible Officer" shall also include the
Cashier,  any Assistant  Cashier,  any Trust Officer or Assistant Trust Officer,
the  Controller  and any Assistant  Controller or any other officer of the Trust
Company or the Owner Trustee customarily  performing  functions similar to those
performed by any of the above designated  officers and also means,  with respect
to a particular corporate trust matter, any other officer to whom such matter is
referred  because  of his  knowledge  of and  familiarity  with  the  particular
subject.

         "Sale  Date"  shall  have the  meaning  given to such  term in  Section
20.3(a) of the Lease.

         "Sale  Notice"  shall mean a notice  given to the Lessor in  connection
with the election by the Lessee of its Sale Option.

         "Sale Option" shall have the meaning given to such term in Section 20.1
of the Lease.

         "Sale Proceeds  Shortfall"  shall mean the amount by which the proceeds
of a sale  described  in  Section  22.1 of the Lease  are less than the  Limited
Recourse  Amount with respect to the Properties if it has been  determined  that
the Fair Market Sales Value of the  Properties at the  expiration of the term of
the Lease has been  impaired by greater than  ordinary  wear and tear during the
Term of the Lease.

         "Scheduled  Interest  Payment Date" shall mean (a) as to any Eurodollar
Loan  or  Eurodollar  Holder  Advance,  the  last  day  of the  Interest  Period
applicable to such Eurodollar  Loan or Eurodollar  Holder Advance (or respecting
any Eurodollar  Loan or Eurodollar  Holder Advance having and Interest Period of
six (6)  months,  each  three  (3)  month  anniversary  of such  Loan or  Holder
Advance), (b) as to any ABR Loan or any ABR Holder Advance, the fifteenth day of
each month,  unless such day is not a Business  Day and in such case on the next
occurring Business Day and (c) as to all Loans and Holder Advances,  the date of
any voluntary or involuntary payment, prepayment,  return or redemption, and the
Maturity Date or the Expiration Date, as the case may be.

         "Securities  Act" shall mean the  Securities  Act of 1933,  as amended,
together with the rules and regulations promulgated thereunder.


                                  Appendix-26
<PAGE>


         "Security  Agreement"  shall mean the  Security  Agreement  dated on or
about the Initial Closing Date between the Lessor and the Bank.

         "Security  Documents"  shall  mean  the  collective  reference  to  the
Security  Agreement,  the  Mortgage  Instruments,  (to the  extent  the Lease is
construed as a security  instrument) the Lease, the UCC Financing Statements and
all other security documents  hereafter delivered to the Bank granting a lien on
any asset or assets of any Person to secure the  obligations  and liabilities of
the  Lessor  under the Credit  Agreement  and/or  under any of the other  Credit
Documents or to secure any guarantee of any such obligations and liabilities.

         "Soft Costs" shall mean all costs which are  ordinarily  and reasonably
incurred   in   relation   to  the   acquisition,   development,   installation,
construction,  improvement and testing of the Properties  other than Hard Costs,
including without limitation structuring fees,  administrative fees, legal fees,
upfront fees, fees and expenses related to appraisals, title examinations, title
insurance,  document  recordation,   surveys,  environmental  site  assessments,
geotechnical  soil  investigations  and  similar  costs  and  professional  fees
customarily  associated with a real estate closing, the Commitment Fee, fees and
expenses  of the Owner  Trustee  payable  or  reimbursable  under the  Operative
Agreements  and  costs  and  expenses  incurred  pursuant  to  Section  7 of the
Participation Agreement.

         "Subsidiary"  shall mean, as to any Person, any corporation of which at
least a majority of the outstanding  stock having by the terms thereof  ordinary
voting power to elect a majority of the board of  directors of such  corporation
(irrespective  of whether or not at the time stock of any other class or classes
of such  corporation  shall  have or might  have  voting  power by reason of the
happening of any contingency) is at the time owned by such Person, or by one (1)
or more Subsidiaries, or by such Person and one (1) or more Subsidiaries.

         "Supplemental  Amounts"  shall have the  meaning  given to such term in
Section 9.18 of the Credit Agreement.

         "Supplemental Rent" shall mean all amounts, liabilities and obligations
(other than Basic Rent) which the Lessee assumes or agrees to pay to the Lessor,
the Trust Company,  the Bank or any other Person under the Lease or under any of
the other Operative  Agreements  including  without  limitation  payments of the
Termination   Value  and  the  Maximum   Residual   Guarantee   Amount  and  all
indemnification amounts, liabilities and obligations.

         "Taxes"  shall  have  the  meaning  specified   in  the  definition  of
"Impositions".

         "Term" shall have the meaning specified in Section 2.2 of the Lease.

         "Termination Date" shall have the meaning specified  in Section 16.2(a)
of the Lease.

         "Termination  Event" shall mean (a) with  respect to any Pension  Plan,
the occurrence of a Reportable Event or an event described in Section 4062(e) of
ERISA,  (b) the withdrawal of the Lessee or any ERISA  Affiliate from a Multiple
Employer Plan during a plan year in which it was


                                  Appendix-27
<PAGE>

a substantial employer (as such term is defined in Section 4001(a)(2) of ERISA),
or the termination of a Multiple Employer Plan, (c) the distribution of a notice
of  intent  to  terminate  a Plan or  Multiemployer  Plan  pursuant  to  Section
4041(a)(2) or 4041A of ERISA,  (d) the institution of proceedings to terminate a
Plan or  Multiemployer  Plan by the PBGC under  Section  4042 of ERISA,  (e) any
other event or condition  which might  constitute  grounds under Section 4042 of
ERISA for the termination of, or the appointment of a trustee to administer, any
Plan or  Multiemployer  Plan,  or (f) the complete or partial  withdrawal of the
Lessee or any ERISA Affiliate from a Multiemployer Plan.

         "Termination Notice" shall have  the meaning  specified in Section 16.1
of the Lease.

         "Termination  Value"  shall mean the sum of (a) either (i) with respect
to all Properties,  an amount equal to the aggregate  outstanding  Property Cost
for all the Properties,  in each case as of the last occurring  Payment Date, or
(ii) with respect to a particular Property, an amount equal to the Property Cost
allocable to such Property, plus (b) respecting the amounts described in each of
the  foregoing  subclause (i) or (ii),  as  applicable,  any and all accrued but
unpaid interest on the Loans and any and all Holder Yield on the Holder Advances
related to the applicable  Property Cost, plus (c) to the extent the same is not
duplicative  of the amounts  payable under clause (b) above,  all other Rent and
other amounts then due and payable or accrued under the Agency Agreement,  Lease
and/or under any other Operative Agreement (including without limitation amounts
under  Sections 11.1 and 11.2 of the  Participation  Agreement and all costs and
expenses referred to in clause FIRST of Section 22.2 of the Lease).

         "Transaction  Expenses"  shall mean all Soft Costs and all other  costs
and expenses incurred in connection with the preparation, execution and delivery
of the Operative  Agreements and the transactions  contemplated by the Operative
Agreements including without limitation all of the following:

                  (a)  the   reasonable   fees,   out-of-pocket   expenses   and
         disbursements  of counsel  in  negotiating  the terms of the  Operative
         Agreements  and the  other  transaction  documents,  preparing  for the
         closings  under,  and  rendering  opinions  in  connection  with,  such
         transactions  and in rendering  other  services  customary  for counsel
         representing  parties  to  transactions  of the types  involved  in the
         transactions contemplated by the Operative Agreements;

                  (b)  the   reasonable   fees,   out-of-pocket   expenses   and
         disbursements  of  accountants  for the Lessee in  connection  with the
         transaction contemplated by the Operative Agreements;

                  (c)  any and all  other  reasonable  fees,  charges  or  other
         amounts  payable to the Bank,  the Owner  Trustee  or any broker  which
         arises under any of the Operative Agreements;

                  (d)  any  other   reasonable  fee,   out-of-pocket   expenses,
         disbursement or cost of any party to the Operative Agreements or any of
         the other transaction documents; and


                                  Appendix-28
<PAGE>


                  (e) any and all Taxes and fees incurred in recording or filing
         any Operative  Agreement or any other transaction  document,  any deed,
         declaration,   mortgage,   security  agreement,   notice  or  financing
         statement with any public office,  registry or  governmental  agency in
         connection  with  the   transactions   contemplated  by  the  Operative
         Agreement.

         "Tribunal"  shall  mean  any  state,  commonwealth,  federal,  foreign,
territorial,  or other court or government body, subdivision agency, department,
commission, board, bureau or instrumentality of a governmental body.

         "Trust" shall mean the DTSD Realty Trust 1999-1.

         "Trust  Agreement"  shall mean the Amended,  Restated  and  Replacement
Trust  Agreement dated on or about the Initial Closing Date between the Bank and
the Owner Trustee.

         "Trust Company" shall mean First Security Bank,  National  Association,
in its  individual  capacity,  and any  successor  owner trustee under the Trust
Agreement in its individual capacity.

         "Trust  Estate" shall have the meaning  specified in Section 2.2 of the
Trust Agreement.

         "Type"  shal  mean,  as  to  any  Loan, whether  it is an ABR Loan or a
Eurodollar Loan.

         "UCC Financing Statements" shall mean collectively the Lender Financing
Statements and the Lessor Financing Statements.

         "Unfunded  Amount"  shall have the meaning  specified in Section 3.2 of
the Agency Agreement.

         "Unfunded Liability" shall mean, with respect to any Plan, at any time,
the amount (if any) by which (a) the present  value of all  benefits  under such
Plan  exceeds (b) the fair market  value of all Plan  assets  allocable  to such
benefits,  all  determined  as of the then most recent  valuation  date for such
Plan, but only to the extent that such excess  represents a potential  liability
of the  Company or any member of the  Controlled  Group to the PBGC or such Plan
under Title IV of ERISA.

         "Uniform  Commercial Code" and "UCC" shall mean the Uniform  Commercial
Code as in effect in any applicable jurisdiction.

         "United  States  Bankruptcy  Code"  shall  mean  Title 11 of the United
States Code.

         "U.S. Taxes" shall have the meaning specified in Section 11.2(e) of the
Participation Agreement.


                                  Appendix-29
<PAGE>


         "Withholdings" shall have the meaning specified  in  Section 11.2(e) of
the Participation Agreement.

         "Work"  shall  mean the  furnishing  of labor,  materials,  components,
furniture,  furnishings,  fixtures,  appliances,  machinery,  equipment,  tools,
power, water, fuel, lubricants,  supplies, goods and/or services with respect to
any Property.

         "Year 2000" shall mean the calendar year beginning  January 1, 2000 and
ending December 31, 2000.


                                  Appendix-30

