<SUBMISSION>
<ACCESSION-NUMBER>0000910680-06-000882
<TYPE>8-K
<PUBLIC-DOCUMENT-COUNT>4
<PERIOD>20060822
<ITEMS>1.01
<ITEMS>8.01
<ITEMS>9.01
<FILING-DATE>20060823
<DATE-OF-FILING-DATE-CHANGE>20060823
<FILER>
<COMPANY-DATA>
<CONFORMED-NAME>JACLYN INC
<CIK>0000052969
<ASSIGNED-SIC>3100
<IRS-NUMBER>221432053
<STATE-OF-INCORPORATION>DE
<FISCAL-YEAR-END>0630
</COMPANY-DATA>
<FILING-VALUES>
<FORM-TYPE>8-K
<ACT>34
<FILE-NUMBER>001-05863
<FILM-NUMBER>061051253
</FILING-VALUES>
<BUSINESS-ADDRESS>
<STREET1>635 59TH STREET
<CITY>WEST NEW YORK
<STATE>NJ
<ZIP>07093
<PHONE>2018689400
</BUSINESS-ADDRESS>
<MAIL-ADDRESS>
<STREET1>5801 JEFFERSON STREET
<CITY>WEST NEW YORK
<STATE>NJ
<ZIP>07093
</MAIL-ADDRESS>
</FILER>
<DOCUMENT>
<TYPE>8-K
<SEQUENCE>1
<FILENAME>f8k-08222006.htm
<DESCRIPTION>AUGUST 22, 2006
<TEXT>
<HTML>
<HEAD>
<TITLE></TITLE>
</HEAD>
<BODY>


<!-- MARKER FORMAT-SHEET="Head Major Center Bold" FSL="Default" -->
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>UNITED STATES <BR>SECURITIES AND
EXCHANGE COMMISSION <BR>Washington, D.C. 20549 </FONT></H1>

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     <P ALIGN=CENTER>_________________ </P>

<!-- MARKER FORMAT-SHEET="Head Major Center Bold" FSL="Default" -->
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=3>FORM 8-K </FONT></H1>

<!-- MARKER FORMAT-SHEET="Head Major Center Bold" FSL="Default" -->
<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>CURRENT REPORT <BR>Pursuant to Section 13
or 15(d) of the Securities Exchange Act of 1934 </FONT></H1>

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<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Date of Report (Date of
earliest event reported): August 22, 2006 </FONT></P>



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 <TD ALIGN="CENTER" WIDTH="100%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><B>JACLYN, INC. </B></FONT> <HR SIZE="1" WIDTH="100%" COLOR="Black"></TD></TR>
<TR VALIGN="TOP">
     <TD ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">(Exact Name of Registrant as Specified in its Charter) </FONT></TD></TR>
</TABLE>
<BR>

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<TR VALIGN=Bottom>
     <TH ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH>
     <TH ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH>
     <TH ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH></TR>
<TR VALIGN=Bottom>
     <TD WIDTH="33%" ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>Delaware</U></FONT></TD>
     <TD WIDTH="33%" ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>1-5863</U></FONT></TD>
     <TD WIDTH="34%" ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>22-1432053</U></FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(State or Other Jurisdiction</FONT></TD>
     <TD ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(Commission</FONT></TD>
     <TD ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(IRS Employer</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>of Incorporation)</FONT></TD>
     <TD ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>File No.)</FONT></TD>
     <TD ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Identification No.)</FONT></TD></TR>
</TABLE>
<BR>
<TABLE CELLPADDING="0" CELLSPACING="0" ALIGN="CENTER" WIDTH="100%">
<TR VALIGN=Bottom>
     <TH ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH>
     <TH ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH></TR>
<TR VALIGN=Bottom>
     <TD WIDTH="25%" ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">635 59<SUP>TH </SUP>Street </FONT></TD>
     <TD WIDTH="65%" ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH="10%" ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>West New York, New Jersey</FONT></TD>
     <TD ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>07093</FONT></TD></TR>
<TR>
     <TD ALIGN="CENTER"><HR NOSHADE COLOR=#000000 SIZE=1></TD>
     <TD ALIGN="CENTER"><HR NOSHADE COLOR=#000000 SIZE=1></TD>
     <TD ALIGN="CENTER"><HR NOSHADE COLOR=#000000 SIZE=1></TD></TR>
<TR VALIGN=top>
     <TD ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(Address of Principal Executive Offices)</FONT></TD>
     <TD ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(Zip Code)</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD></TR>
</TABLE>
<BR>

<!-- MARKER FORMAT-SHEET="Head Minor Center" FSL="Default" -->
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Registrant&#146;s
telephone number, including area code:&nbsp;&nbsp;(201) 868-9400  </FONT></P>

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<TR VALIGN="BOTTOM">
     <TH ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE="3"></FONT></TH></TR>
<TR VALIGN="TOP">
 <TD ALIGN="CENTER" WIDTH="100%"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">Not Applicable</FONT> <HR SIZE="1" WIDTH="100%" COLOR="Black"></TD></TR>
<TR VALIGN="TOP">
     <TD ALIGN="CENTER"><FONT FACE="Times New Roman, Times, Serif" SIZE="2">(Former Name or Former Address, if Changed Since Last Report) </FONT></TD></TR>
</TABLE>
<BR>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Check the appropriate box below if
the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the
registrant under any of the following provisions: </FONT></P>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2> <IMG SRC="ballot.jpg" HEIGHT="15" WIDTH="15">  </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)  </FONT></TD>
</TR>
</TABLE>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2> <IMG SRC="ballot.jpg" HEIGHT="15" WIDTH="15">  </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)  </FONT></TD>
</TR>
</TABLE>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2> <IMG SRC="ballot.jpg" HEIGHT="15" WIDTH="15"> </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))  </FONT></TD>
</TR>
</TABLE>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2><IMG SRC="ballot.jpg" HEIGHT="15" WIDTH="15"></FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))  </FONT></TD>
</TR>
</TABLE>
<BR>


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<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Item 1.01.  </B></FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=90%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
<B>Entry into a Material Definitive Agreement.  </B></FONT></TD>
</TR>
</TABLE>
<BR>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Jaclyn,
Inc. (the &#147;<U>Company</U>&#148;) entered into an Agreement of Lease dated as of
September 1, 2006 (the &#147;<U>Lease</U>&#148;) with 195 Spring Valley Associates, LLC
(&#147;<U>Spring Valley</U>&#148;), under which the Company has leased an office building
(including the underlying land and other improvements) located in Maywood, New Jersey (the
&#147;<U>Leased Premises</U>&#148;), to which the Company intends to relocate its
executive offices later this year. The lease has a 10-year term, and grants to the Company
an option to purchase the Leased Premises at any time during the term of the Lease at a
purchase price not to exceed $3,075,000, plus increases based on a multiple of the
consumer price index. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Spring
Valley is the<B> </B>prospective purchaser of the Leased Premises, with the closing of the
purchase expected to take place by the end of August, or shortly thereafter. The Company
intends to provide Spring Valley with $2,200,000 in mortgage financing, to be secured by a
first priority mortgage in favor of the Company on the land, office building, and other
customary rights of the mortgagor. </FONT></P>

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<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Item  8.01.</B></FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=90%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
<B>Other Events.  </B></FONT></TD>
</TR>
</TABLE>
<BR>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;On
August 22, 2006, the Company issued a press release relating to, among other things, the
matters disclosed above in Item 1.01 of this Current Report on Form 8-K. A copy of that
press release is attached to this Current Report on Form 8-K as Exhibit 99.01 and is
incorporated by reference herein. </FONT></P>



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<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B>Item 9.01.</B> </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=90%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
<B>Financial Statements and Exhibits. </B> </FONT></TD>
</TR>
</TABLE>
<BR>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(a)  </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=90%><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>Financial
Statements of Businesses Acquired</U>. Not Applicable.  </FONT></TD>
</TR>
</TABLE>
<BR>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(b) </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=90%><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>Pro
Forma Financial Information</U>. Not Applicable.  </FONT></TD>
</TR>
</TABLE>
<BR>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(c) </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=90%><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>Exhibits</U>.  </FONT></TD>
</TR>
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<BR>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;<U>Exhibit No.</U>  </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=80%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
<U>Description</U> </FONT></TD>
</TR>
</TABLE>
<BR>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.01  </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=80%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Agreement  of Lease  dated as of
September  1, 2006  between  the  Company  and 195 Spring Valley Associates, LLC.</FONT></TD>
</TR>
</TABLE>
<BR>

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<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;99.01  </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=80%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Press Release of the Company dated August 22, 2006.</FONT></TD>
</TR>
</TABLE>
<BR>



<DIV STYLE="page-break-after:always"></DIV>

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<H1 ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>SIGNATURES </FONT></H1>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pursuant
to the requirements of Securities Exchange Act of 1934, the registrant has duly caused
this report to be signed on its behalf by the undersigned hereunto duly authorized. </FONT></P>


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<TR VALIGN=Bottom>
     <TD WIDTH=60% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Date: August 23, 2006</FONT></TD>
     <TD WIDTH=40% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>JACLYN, INC.</FONT></TD></TR>
</TABLE>
<BR><BR>

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<TR VALIGN=Bottom>
     <TH><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH>
     <TH><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH></TR>
<TR VALIGN=Bottom>
     <TD WIDTH=60% ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD WIDTH=40% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>By: <U>/s/ Robert Chestnov</U></FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Robert Chestnov, President</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD></TR>
</TABLE>


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<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>EXHIBIT INDEX </FONT></P>


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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;<U>Exhibit No.</U>  </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=80%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
<U>Description</U> </FONT></TD>
</TR>
</TABLE>
<BR>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.01  </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=80%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Agreement  of Lease  dated as of
September  1, 2006  between  the  Company  and 195 Spring Valley Associates, LLC.</FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=10%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;99.01  </FONT></TD>
<TD><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=80%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Press Release of the Company dated August 22, 2006.</FONT></TD>
</TR>
</TABLE>
<BR>




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`
end
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>3
<FILENAME>ex10_1-f8k08222006.htm
<DESCRIPTION>10.01
<TEXT>
<HTML>
<HEAD>
<TITLE></TITLE>
</HEAD>
<BODY>


<!-- MARKER FORMAT-SHEET="Head Right" FSL="Default" -->
<P ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B><U>Exhibit 10.01 </U></B></FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>AGREEMENT OF LEASE made as of the
1<SUP>st</SUP> day of September, 2006 between 195 SPRING VALLEY ASSOCIATES, LLC
(&#147;Landlord&#148;), having an address at 155 North Dean Street, Englewood, New Jersey
07631 and JACLYN, INC., having an address at 635-59<SUP>th</SUP> Street, West New York, NJ
07093 (&#147;Tenant&#148;). </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Center Underline" FSL="Default" -->
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>ARTICLE 1 </U> </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Center Underline" FSL="Default" -->
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>PREMISES AND TERM OF
LEASE</U> </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Section
1.1</U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Landlord does hereby demise and lease to Tenant, and Tenant does hereby hire
and take from Landlord, the Premises (hereinafter defined), subject to all existing
liens, charges, encumbrances and matters of record and the terms and conditions
hereinafter provided. In the event the Landlord does not close title to the Premises,
this Lease shall be null and void.  </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;TO
HAVE AND TO HOLD said Lease unto Tenant, its successors and assigns for a term which is
to commence on the date the Landlord closes title to the Premises and shall end on the
last day of the month in which the tenth (10<SUP>th</SUP>) anniversary of the
Commencement Date occurs (&#147;Expiration Date&#148;) unless such term shall be sooner
terminated as hereinafter provided.  </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;It
is hereby mutually covenanted and agreed by and between the parties hereto that this
Lease is made upon the foregoing and upon the agreements, covenants and conditions herein
set forth.  </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Center Underline" FSL="Default" -->
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>ARTICLE 2 </U> </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Minor Center" FSL="Default" -->
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>DEFINITIONS</U> </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Section
2.1 </U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The terms defined in this Article shall, for all purposes of this Lease and all
agreements supplemental hereto, have the meanings herein specified.  </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush Level 1" FSL="Default" -->
<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;          &#147;Default&#148; shall
mean any condition or event which constitutes or           would, after notice or lapse
of time, or both, constitute an Event of Default.  </FONT></TD>
</TR>
</TABLE>
<BR>

<!-- MARKER FORMAT-SHEET="Para Flush Level 1" FSL="Default" -->
<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          &#147;Governmental Authority&#148; shall mean laws and ordinances of any or all
          of the federal, state, city, county and borough governments and rules,
          regulations, orders and directives of any and all departments, subdivisions,
          bureaus, agencies or offices thereof, and of any other governmental, public or
          quasi-public authorities having jurisdiction over the Premises, and the
          direction of any public officer pursuant to law, whether now or hereafter in
          force.  </FONT></TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          &#147;Impositions&#148; shall have the meaning provided in Section 4.1.  </FONT></TD>
</TR>
</TABLE>
<BR>

<!-- MARKER FORMAT-SHEET="Para Flush Level 1" FSL="Default" -->
<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
(d)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          &#147;Land&#148; shall mean the parcel of land described in <U>Schedule A</U>.  </FONT></TD>
</TR>
</TABLE>
<BR>


<!-- MARKER PAGE="sheet: 10; page: 10" -->
<HR SIZE=5 COLOR=GRAY NOSHADE>


<!-- MARKER FORMAT-SHEET="Para Flush Level 1" FSL="Default" -->
<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
(e)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          &#147;Landlord&#148; shall mean only the owner or owners at the time in
question           of the Land, so that in the event of any sale or sales or transfer or
transfers           of the Land, the seller or transferor shall be and hereby is entirely
freed and           relieved of all agreements, covenants and obligations of Landlord
hereunder and           it shall be deemed and construed without further agreement
between the parties           or their successors-in-interest or between the parties and
the purchaser or           transferee on any such sale or transfer that such purchaser or
transferee has           assumed and agreed to carry out any and all agreements,
covenants and           obligations of Landlord hereunder accruing from and after the
date of sale or           transfer.  </FONT></TD>
</TR>
</TABLE>
<BR>

<!-- MARKER FORMAT-SHEET="Para Flush Level 1" FSL="Default" -->
<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
(f)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          &#147;Lease Year&#148; shall mean for the first Lease Year, the twelve (12)
          month period, plus any partial month, commencing on the Commencement Date and
          ending on last day of the calendar month following the first (1st) anniversary
          of the Commencement Date and for each Lease Year thereafter, each twelve (12)
          month period thereafter.  </FONT></TD>
</TR>
</TABLE>
<BR>

<!-- MARKER FORMAT-SHEET="Para Flush Level 1" FSL="Default" -->
<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
(g)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          &#147;Penalty Rate&#148; shall mean the greater of (a) 12% per annum, and (b)
3%           over the prime rate of interest published in the Wall Street Journal (but in
          neither case greater than the maximum legally collectible interest rate).
          Landlord and Tenant acknowledge that the prime rate of Interchange Bank may
          fluctuate during any period of accrual of interest at the Penalty Rate under
          this Lease and that, in such event, interest during such period may accrue at a
          fluctuating, rather than fixed, rate.  </FONT></TD>
</TR>
</TABLE>
<BR>

<!-- MARKER FORMAT-SHEET="Para Flush Level 1" FSL="Default" -->
<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
(h)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          &#147;Premises&#148; shall mean the Land and all buildings, improvements and
          structures now or hereafter erected on the Land, and the machinery, kitchen,
          restaurant, or business equipment and fixtures, appliances, engines, dynamos,
          boilers, elevators, radiators, air-conditioning compressors, ducts, pipes,
          conduits and fittings at any time now or hereafter erected, constructed,
affixed           or attached to or placed in or placed upon the Land, and any and all
          alterations, renewals and replacements thereof, additions thereto and
          substitutes therefore together with all of Landlord&#146;s right, title and
          interest in all easements, rights and other matters appurtenant to the Land and
          in and to any land lying in the bed of any roads adjacent to the Land.  </FONT></TD>
</TR>
</TABLE>
<BR>

<!-- MARKER FORMAT-SHEET="Para Flush Level 1" FSL="Default" -->
<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
(i)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          &#147;Rental&#148; shall have the meaning provided in Article 3.  </FONT></TD>
</TR>
</TABLE>
<BR>

<!-- MARKER FORMAT-SHEET="Para Flush Level 1" FSL="Default" -->
<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
(j)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          &#147;Requirements&#148; shall mean any and all present and future laws, rules,
          orders, ordinances, regulations, statutes and requirements of any Governmental
          Authority.  </FONT></TD>
</TR>
</TABLE>
<BR>

<!-- MARKER FORMAT-SHEET="Para Flush Level 1" FSL="Default" -->
<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
(k)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          &#147;Tenant&#148; shall mean the Tenant herein named or any assignee or other
          successor-in-interest (immediate or remote) of the Tenant herein named, which
at           the time in question is the owner of the Tenant&#146;s estate and interest
          granted by this Lease; but the foregoing provisions of this subsection shall
not           be construed to relieve the Tenant herein named and/or any assignee or
other           successor-in-interest (whether immediate or remote) of the Tenant herein
named           from the full and prompt payment, performance and observance of the
covenants,           obligations and conditions to be paid, performed and observed by
Tenant under           this Lease.  </FONT></TD>
</TR>
</TABLE>
<BR>

<!-- MARKER FORMAT-SHEET="Head Minor Center" FSL="Default" -->
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>2 </FONT></P>

<!-- MARKER PAGE="sheet: 11; page: 11" -->
<HR SIZE=5 COLOR=GRAY NOSHADE>


<!-- MARKER FORMAT-SHEET="Para Flush Level 1" FSL="Default" -->
<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
(l)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
          &#147;Unavoidable Delays&#148; shall mean delays due to fire, casualty, any
          strike, lock-out or other labor trouble, governmental preemption of priorities
          or other controls in connection with a national or other public emergency or
          shortages of fuel, supplies or labor resulting therefrom, or any other cause,
          whether similar or dissimilar, beyond Landlord&#146;s or Tenant&#146;s
          reasonable control, as the case may be. The delay in making any payment due to
a           party hereunder shall not, in any instance, be deemed to be an Unavoidable
          Delay.  </FONT></TD>
</TR>
</TABLE>
<BR>

<!-- MARKER FORMAT-SHEET="Head Center Underline"  -->
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>ARTICLE 3 </U> </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Center Underline" FSL="Default" -->
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>RENT</U> </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Section
3.1 </U>(a) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Tenant shall pay to Landlord, in currency which
at the time of payment is legal tender for public and private debts in the United States
of America the fixed net rental (the &#147;Fixed Net Rent&#148;) in the following
amounts, for the following periods:  </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Flush Level 1" FSL="Default" -->
<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
a.
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;From
the date hereof through the third (3<SUP>rd</SUP>) Lease Year the monthly
                    rental shall be Eighteen Thousand Dollars ($18,000).  </FONT></TD>
</TR>
</TABLE>
<BR>

<!-- MARKER FORMAT-SHEET="Para Flush Level 1" FSL="Default" -->
<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>
b.
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;For the
fourth (4<SUP>th</SUP>) through the tenth (10<SUP>th</SUP>) Lease Year
                    the monthly rental shall be Twenty-One Thousand Dollars ($21,000) .  </FONT></TD>
</TR>
</TABLE>
<BR>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Section
3.2 </U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Tenant shall also pay all Impositions, all additional rent and all other sums due
and payable hereunder. Tenant shall reimburse Landlord upon demand for all costs and
expenses, including counsel fees, paid or incurred by Landlord in curing any Default or
arising out of any indemnity given herein by Tenant to Landlord, together with interest
at the Penalty Rate from the date paid by Landlord. The Fixed Net Rent, Impositions and
all other sums, costs, expenses, charges, payments and deposits which Tenant, pursuant to
any provision of this Lease, assumes or agrees to pay and/or deposit, are collectively
referred to as &#147;Rental&#148;. All Rental (except for the Impositions, which shall be
paid in accordance with the terms of Article 4 hereof) shall be paid to Landlord at its
address set forth on page 1 above, or such other place, or to Landlord&#146;s agent and
at such other place, as Landlord shall designate, from time to time, by notice. Landlord
shall have (in addition to all other rights and remedies) all the rights and remedies
provided for under the terms of this Lease and applicable law in respect to the payment
of Rental as Landlord possesses in respect to the payment of the Fixed Net Rent.  </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Section
3.3 </U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Notwithstanding any other provision of this Lease, this Lease is a triple net
lease and the Rental shall be paid without notice or demand, and without counterclaim,
setoff, defense, suspension or deferment, of any kind, and without deduction, abatement
or diminution of any kind. This Lease shall not terminate (except as may be expressly set
forth herein), and Tenant shall not have any right to terminate or avoid this Lease or be
entitled to the abatement (in whole or in part) of any Rental or rents hereunder or any
reduction thereof, nor shall the obligations and liabilities of Tenant hereunder be in
any way affected for any reason, including without limitation: (i) any defect in, damage
to, destruction of, or (subject to the terms hereof) condemnation of any part of the
Premises; (ii) any restriction of or interference with any use of the Premises or action
by Government Authorities or third parties;  </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Minor Center" FSL="Default" -->
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>3 </FONT></P>

<DIV STYLE="page-break-after:always"></DIV>
<!-- MARKER PAGE="sheet: 12; page: 12" -->
<HR SIZE=5 COLOR=GRAY NOSHADE>


<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>(iii) any
matter affecting title to, or any eviction by Government Authorities or           third
parties from the Premises; (iv) any proceeding relating to Landlord or           action
taken with respect to this Lease by any trustee or receiver of any           successor to
Landlord or by any court in any proceedings; (v) any failure by           Landlord to
perform or comply with this Lease or any other agreement or business           dealings
with Tenant; (vi) impossibility or illegality of performance by Tenant;           or
(vii) any other occurrence whatsoever, whether similar or dissimilar to the
          foregoing and whether or not Tenant shall have notice or knowledge of any of
the           foregoing. The obligations of Tenant hereunder shall be separate and
independent           covenants and agreements. Each payment made by Tenant to Landlord
pursuant to           this Lease shall be final and Tenant shall not seek to recover all
or any part           of such payment from Landlord for any reason whatsoever.  </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;          Tenant
shall remain obligated under this Lease in accordance with its terms and           shall
not take any action to terminate, rescind or avoid this Lease,           notwithstanding
any bankruptcy, insolvency, reorganization, liquidation,           dissolution or other
proceeding affecting Landlord or any assignee of Landlord           or any action with
respect to this Lease which may be taken by any trustee,           receiver or liquidator
or by any court. Tenant waives all rights to terminate or           surrender this Lease,
or to any abatement, reduction or deferment of Rental.  </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Center Underline" FSL="Default" -->
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>ARTICLE 4 </U> </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Center Underline" FSL="Default" -->
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>TAXES<BR>(Impositions)</U> </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Section
4.1 </U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Tenant covenants and agrees to pay, as hereinafter provided, all of the
following items (collectively &#147;Impositions&#148;): All taxes (including, without
limitation, all ad valorem, real estate, sales and use, value added, single business,
gross receipts, transaction, taxes on rent, privilege, or similar taxes), all assessments
(including, without limitation, all assessments for public improvements or benefits,
whether or not commenced or completed prior to the date hereof and whether or not to be
completed within the term of this Lease, and any other assessments of whatever name,
nature, and kind, and whether or not now within the contemplation of the parties,
including any special assessments for or imposed by any business improvement district or
by any special assessment district), water, sewer, or other rents and charges, excises,
levies, fees (including, without limitation, license, permit, inspection, authorization,
and similar fees), fines, penalties, and all other governmental charges and any interest
or costs with respect thereto, charges for any easement or agreement maintained for the
benefit of the Premises, in each case whether general or special, ordinary or
extraordinary, or foreseen or unforeseen, of every character, kind and nature whatsoever
which at any time prior to or during the term of this Lease may be assessed, levied,
confirmed, imposed upon, or grow or become due and payable out of or in respect of, or
charged with respect to or become a lien on, the Landlord, the Premises, or the sidewalks
or streets in front of or adjoining the Premises, or any vault, passageway or space in,
over or under such sidewalk or street, or any other appurtenances of the Premises, or any
personal property, equipment or other facility used in the operation thereof, or the rent
or income received therefrom, or any use, possession or occupancy thereof, or this
transaction or the Rental payable hereunder, or any document to which Tenant is a party
creating or transferring an interest or estate in the Premises, together with any and all
interest, penalties, and costs resulting from delayed payment of any of the foregoing
attributable to an act or omission of Tenant.  </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Minor Center" FSL="Default" -->
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>4 </FONT></P>

<DIV STYLE="page-break-after:always"></DIV>
<!-- MARKER PAGE="sheet: 13; page: 13" -->
<HR SIZE=5 COLOR=GRAY NOSHADE>


<!-- MARKER FORMAT-SHEET="Para Flush" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Tenant shall, during the term of this
Lease, pay and discharge, as additional rent, all Impositions not later than thirty (30)
days prior to the due date thereof, or thirty (30) days prior to the day any fine,
penalty, interest or cost may be added thereto as imposed by law for the non-payment
thereof, if such day is used to determine the due date of the respective item; provided,
however, that if, by law, any Imposition may at the option of the taxpayer be paid in
installments (whether or not interest shall accrue on the unpaid balance of such
Imposition), Tenant may exercise the option to pay the same in such installments, provided
such installment payments are not prohibited by the terms of any Mortgage and provided
further that the amount of all installments of any such Impositions (other than
installments of special improvement assessments), which are a lien or charge on the
Premises during the term of this Lease and which are to become due and payable after the
Expiration Date, shall (subject to the terms of any Mortgage which requires an amount
equal to such Impositions to be deposited with the holder of such Mortgage) be deposited
with Landlord for such payment on the date which shall be one (1) year immediately prior
to the Expiration Date. </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;          The
parties agree that nothing herein contained shall require Tenant to pay
          municipal, state or federal income, inheritance, estate, succession, transfer
or           gift taxes of Landlord, or any corporate franchise taxes imposed upon
Landlord           or any successor of Landlord.  </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Section
4.2 </U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Any Imposition, relating to a fiscal period of the taxing authority, a part of
which period is included within the term of this Lease and a part of which is included in
a period of time after the expiration or termination of the term of this Lease, shall
(whether or not such Imposition shall be assessed, levied, confirmed, imposed upon or in
respect of or become a lien upon the Premises, or shall become payable during the term of
this Lease) be apportioned between Landlord and Tenant as of the expiration or
termination of the term of this Lease, so that Tenant shall pay that portion of such
Imposition which that part of such fiscal period included in the period of time prior to
the expiration or termination of the term of this Lease bears to such fiscal period, and
Landlord shall pay the remainder thereof.  </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Section
4.3 </U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Tenant shall have the right at its own expense to contest the amount or validity,
in whole or in part, of any Imposition by appropriate proceedings diligently conducted in
good faith but only after payment of such Imposition unless such payment would operate as
a bar to such contest or interfere materially with the prosecution thereof, in which
event, notwithstanding the provisions of Section 4.1 hereof, payment of such Imposition
shall be postponed if and only so long as:  </FONT></P>

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          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               neither the Premises nor any part thereof would by reason of such postponement
               or deferment be, in the reasonable judgment of the Landlord, in danger of being
               forfeited or lost, and </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=3%></TD>
               <TD WIDTH=97%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               Landlord would not be, by reason of such postponement or deferment, subject to
               any actual or threatened criminal sanctions or penalties or personal liability,
               as Landlord shall determine in its reasonable judgment, and </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>5 </FONT></P>


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          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=6%></TD>
               <TD WIDTH=94%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               No Mortgage would by reason of such postponement or deferment be, in the
               reasonable judgment of Landlord, in danger of being put in default or
               foreclosure. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Upon
the termination of such proceedings, it shall be the obligation of Tenant to pay the
amount of such Imposition or part thereof as finally determined in such proceedings, the
payment of which may have been deferred during the prosecution of such proceedings,
together with any costs, fees (including reasonable counsel fees), interest, penalties or
other liabilities in connection therewith, and upon such payment in full. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U> Section
4.4 </U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Tenant shall have the right to seek a reduction in the valuation of the Premises
assessed for tax purposes and to prosecute any action or proceeding in connection
therewith. Provided Tenant is not then in Default, Tenant shall be authorized to collect
any tax refund obtained by reason thereof and, to the extent such refund is for
Impositions paid by Tenant, to retain the same.  </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U> Section
4.5 </U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Landlord agrees that whenever Landlord&#146;s cooperation is required in any of
the proceedings brought by Tenant as aforesaid, Landlord will reasonably cooperate
therein at the request and expense of Tenant, provided same shall not subject Landlord to
any cost, expense or liability of any nature whatsoever, and Tenant hereby indemnifies
and agrees to defend and save Landlord free and harmless from and any against such costs,
expenses or liability.  </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U> Section 4.6 </U>In respect of any
payments of Impositions made by Tenant directly to the taxing authority, Tenant shall upon
Landlord&#146;s request furnish to Landlord copies of receipted bills or other reasonably
satisfactory evidence of payment thereof. </FONT></P>

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<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>ARTICLE 6</U> </FONT></P>

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<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>NO PERSONAL
LIABILITY OF LANDLORD</U> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U> Section
6.1 </U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Notwithstanding anything to the contrary in this Lease, in any action or
proceeding brought to enforce any of the obligations of Landlord the judgment or decree
shall be enforceable against Landlord only to the extent of the interest of Landlord in
the Premises, and any such judgment shall not be subject to the execution on, nor be a
lien on, any assets of Landlord other than its interest in the Premises, it being
specifically understood and agreed that Landlord shall have no other liability, personal
or otherwise, hereunder.  </FONT></P>

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<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>ARTICLE 7 </U> </FONT></P>

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<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>INSURANCE</U> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U> Section
7.1 </U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;At all times during the term of this Lease Tenant at its own cost and expense
shall:  </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Minor Center" FSL="Default" -->
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>6 </FONT></P>

<DIV STYLE="page-break-after:always"></DIV>
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          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=6%></TD>
               <TD WIDTH=94%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               Maintain insurance on all of the Premises, including personal property, under a
               special form property insurance policy (previously known as &#147;all
               risk&#148;), with replacement cost valuation and an agreed value endorsement
               (hereinafter referred to as &#147;Special Form&#148;) in an amount equal to not
               less than one hundred percent (100%) of the full replacement cost thereof. If
               not included within the Special Form coverage above, Tenant shall also carry or
               cause to be carried coverage against damage due to water and sprinkler leakage
               and collapse and flood (to the extent such coverage can be obtained at
               commercially reasonable rates in the State of New Jersey), which shall be
               written with limits of coverage of not less than the then replacement value per
               occurrence. Such policy shall be endorsed with (i) replacement coverage, (ii) an
               agreed amount clause (waiving applicable co-insurance clause) in accordance with
               such determination or appraisal, and (iii) coverage for demolition costs and
               increased costs of construction due to changes in Requirements. During any
               period where capital improvements are being undertaken, Tenant shall also
               maintain Builders Risk insurance with respect to the work in question written on
               a completed value (non-reporting) basis with limits provided for herein and
               naming Landlord and Tenant, as their respective interests may appear. Such
               builder&#146;s risk insurance shall also (x) shall contain a waiver or
               subrogation against subcontractors; and (y) if any off site storage location is
               used, such insurance shall cover, for full insurable value, all materials and
               equipment on or about any such off site storage location. </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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          <TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
               <TR VALIGN=TOP>
               <TD ALIGN=RIGHT WIDTH=6%></TD>
               <TD WIDTH=94%><P ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
               Provide and keep in force commercial general liability insurance, written on an
               occurrence basis with respect to the Premises and all operations related
               thereto, whether conducted on or off the Premises, and coverage shall include
               specifically the Premises and all elevators, parking areas, streets, alleys and
               sidewalks adjoining or appurtenant to the Premises. In any event, the insurance
               against liability for injury and death shall be no less than Five Million
               ($5,000,000) Dollars per occurrence, with a deductible of not more than $5,000; </FONT></P></TD>
               </TR>
               </TABLE>
               <BR>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U> Section
7.2 </U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;All insurance provided by Tenant, as required by this Article, shall be carried
in favor of Landlord and the Tenant as their respective interests may appear, and shall
name Landlord as an additional insured.  </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U> Section
7.3 </U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;All insurance required by any provision of this Lease shall be issued by such
responsible insurance companies licensed or authorized to do business in the State of New
Jersey and having a rating of &#147;A-&quot; or better and a financial class of &#147;10&#148; or
better (or the then equivalent of such ratings) as rated by A.M. Best&#146;s Insurance
Guide (or any successor publication of comparable standing). All policies referred to in
this Lease shall be in such form reasonably acceptable to Landlord and shall be obtained
by Tenant for periods of not less than one (1) year.  </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Tenant
and Landlord shall cooperate in connection with the collection of any insurance moneys
that may be due in the event of loss and Tenant shall execute and deliver to Landlord such
proofs of loss and other instruments which may be required for the purpose of obtaining
the recovery of any such insurance moneys. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Minor Center" FSL="Default" -->
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>7 </FONT></P>


<DIV STYLE="page-break-after:always"></DIV>
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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;All
premiums on policies referred to in this Lease shall be paid by Tenant. The originals of
such policies or certificates evidencing such policies, together with evidence of the
payment of premiums thereon, shall be delivered to the Landlord immediately upon receipt
from the insurance company or companies (and such originals may be delivered by Landlord
to the holder of a Mortgage). New or renewal policies or certificates replacing any
policies expiring during the term hereof shall be delivered to Landlord at least thirty
(30) days before the date of expiration, together with proof satisfactory to Landlord that
the full premiums have been paid by Tenant. Premiums on policies shall not be financed in
any manner whereby the lender, on default or otherwise, shall have the right or privilege
of surrendering or cancelling the policies. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Tenant
shall not violate or permit to be violated any of the conditions or provisions of any such
policy, and Tenant shall so perform and satisfy the requirements of the companies writing
such policies such that at all times companies of good standing reasonably satisfactory to
Landlord shall be willing to write and/or continue such insurance. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Center Underline" FSL="Default" -->
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>ARTICLE 8 </U> </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Center Underline" FSL="Default" -->
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>RESTORATION OF THE
PREMISES AND USE OF CASUALTY INSURANCE PROCEEDS</U> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U> Section
8.1 </U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If any portion of the Premises shall be destroyed or damaged in whole or in part
by fire or other casualty (including any casualty for which insurance was not obtained or
obtainable) of any kind or nature, ordinary or extraordinary, foreseen or unforeseen,
Tenant shall give to Landlord immediate notice thereof, and Tenant, at its own cost and
expense, whether or not such damage or destruction shall have been insured, and whether
or not insurance proceeds, if any, shall be sufficient for the purpose, shall promptly
repair, alter, restore, replace and rebuild the same, at least to the extent of its value
prior to such occurrence and to as nearly as possible to its character immediately prior
to such occurrence; and Landlord shall in no event be called upon to repair, alter,
replace, restore or rebuild same, or to pay any of the costs or expenses thereof. If
Tenant shall fail or neglect to restore, repair, replace and rebuild the the Premises, or
the portion thereof so damaged or destroyed, with reasonable diligence, or having so
commenced such restoration, repair, replacement and rebuilding shall fail to complete the
same with reasonable diligence in accordance with the terms of this Lease, or if prior to
the completion of any such restoration, repair, replacement and rebuilding by Tenant,
this Lease shall expire or be terminated for any reason, Landlord may, at Landlord&#146;s
sole option, complete the same at Tenant&#146;s expense.  </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U> Section
8.2 </U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;All moneys which are received from insurance payments shall be used by the Tenant
to restore the improvement to a value which shall be not less than its value prior to
such fire or other casualty. In the event the insurance proceeds shall be insufficient
for the purpose of paying for all repairs and restoration, Tenant shall nevertheless be
required to make such repairs and restoration at its own cost and expense.  </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U> Section
8.3 </U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This Lease shall not terminate or be forfeited or be affected in any manner by
reason of damage to or total, substantial or partial destruction of the Premises or any
part or parts thereof or by reason of the untenantability of the same or any part
thereof, for or due to any reason or cause whatsoever, and Tenant, notwithstanding any
law or statute present or  </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Minor Center" FSL="Default" -->
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>8 </FONT></P>

<DIV STYLE="page-break-after:always"></DIV>
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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>future, waives any and all rights to
quit or surrender the Premises of any part thereof. Tenant expressly agrees that its
obligations hereunder, including the payment of any and all Rental, shall continue as
though said Premises had not been damaged or destroyed and without abatement, suspension,
diminution or reduction of any kind. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Center Underline" FSL="Default" -->
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>ARTICLE 9 </U> </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Center Underline" FSL="Default" -->
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>ASSIGNMENT,
SUBLETTING, ETC.</U> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;          Neither
this Lease nor the interest of Tenant in this Lease, nor the interest of           Tenant
shall be sold, assigned, or otherwise transferred, nor shall Tenant           sublet the
Premises or any part thereof, nor shall any transaction or series of
          transactions be entered into (including, without limitation, any assignment,
          transfer, issuance or redemption of any ownership interest, or any merger,
          consolidation or dissolution), which, directly or indirectly, result in a
change           of control of Tenant without the Landlord&#146;s prior written consent,
which           consent shall not be unreasonably withheld.  </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Center Underline" FSL="Default" -->
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>ARTICLE 10 </U> </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Center Underline" FSL="Default" -->
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>REPAIRS</U> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U> Section
10.1 </U> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Throughout the term of this Lease, Tenant, at its sole cost and expense, shall
take good care of the Premises, including, without limiting the generality of the
foregoing, all equipment, fixtures and articles of personal property therein or thereon
and all sidewalks, grounds, parking areas, vaults, chutes, sidewalk hoists, railings,
gutters, alleys, landscaping and curbs on the Premises and will put, keep and maintain
the same in good and safe order and condition, and make all repairs therein and thereon,
interior and exterior, structural and nonstructural, ordinary and extraordinary, and
unforeseen and foreseen, necessary to keep the same in good and safe order and condition,
howsoever the necessity or desirability therefor may occur, and whether or not
necessitated by obsolescence or defects, latent or otherwise, but reasonable wear and
tear excepted. Tenant shall not commit or suffer, and shall use all reasonable precaution
to prevent, waste, damage, or injury to the Premises. Tenant shall at its own cost and
expense, keep clean and free from dirt, snow, ice, rubbish, obstructions and
encumbrances, the sidewalks, parking areas, grounds, vaults, chutes, sidewalk hoists,
railings, gutters, alleys and curbs on the Premises.  </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Landlord
shall not be required to furnish any services, utilities or facilities whatsoever to the
Premises. It is expressly understood that the Tenant&#146;s will make pay for utility
services throughout the Premises. Landlord shall have no duty or obligation to make any
alteration, change, improvement, replacement or repair to, or to demolish, any portion of
the Premises . </FONT></P>

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<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>9 </FONT></P>

<DIV STYLE="page-break-after:always"></DIV>
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<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>ARTICLE 11 </U> </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Center Underline" FSL="Default" -->
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>CHANGES, ALTERATIONS
AND ADDITIONS</U> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U> Section
11.1 </U> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Tenant shall not commence any alteration upon the Premises unless and until
the Tenant has procured and paid for, so far as the same may be required from time to
time, all permits, certificates and authorizations required by any Governmental Authority
(including any landmark authority) or any officer, department, office, bureau, agency or
instrumentality thereof now existing or hereafter created and having jurisdiction over
the Premises. Landlord shall not unreasonably refuse to join in the application for such
permit or authorization and shall reasonably cooperate with Tenant, without charge except
to the extent Landlord&#146;s participation required is more than de minimis, in which
case Tenant agrees to pay to Landlord, upon demand and as additional rent hereunder, a
reasonable fee and Landlord&#146;s costs paid or incurred in connection therewith.
Landlord shall not be subject to any liability for the payment of any costs or expenses
in connection with any such applications and Tenant hereby indemnifies and agrees to
defend and hold Landlord harmless from and against any and all such costs and expenses.
Copies of all required permits and authorizations shall be delivered to Landlord prior to
the commencement of work on any Capital Improvement.  </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U> Section
11.2 </U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Any Capital Improvement shall be made promptly and in a good and workmanlike
manner and in compliance with all applicable permits, certificates and authorizations and
building and zoning laws and with all other requirements of Governmental Authorities.  </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U> Section
11.3 </U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Premises shall at all times be free of liens for labor and materials
supplied or claimed to have been supplied to the Premises.  </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U> Section
11.4 </U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;No Capital Improvement shall be undertaken until Tenant shall have delivered to
Landlord insurance policies or certificates therefor issued by responsible insurers,
bearing notations evidencing the payment of premiums or accompanied by other evidence
satisfactory to Landlord of such payments, for Worker&#146;s Compensation Insurance
covering all persons employed in connection with the work and with respect to whom death
or bodily injury claims could be asserted against Landlord, Tenant or the Premises, and,
unless the liability insurance then in effect with respect to the Premises shall cover
the risk, owner&#146;s protective liability insurance expressly covering the additional
hazards resulting from the Capital Improvement and work thereon with limits not less than
those, and otherwise subject to the same conditions and requirements, set forth in herein
with respect to the liability insurance required thereunder. If under the provisions of
any fire, liability or other insurance policy or policies then covering said Premises or
any part thereof any consent to such Capital Improvement by said insurance company or
companies issuing such policy or policies shall be required to continue and keep such
policy or policies in full force and effect, Tenant shall obtain such consents and pay
any additional premiums or charges therefor that may be imposed by said insurance company
or companies.  </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U> Section
11.5 </U> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;All alterations, improvements or additions made upon the Premises by Tenant or
any person or entity acting by, under or through Tenant, except furniture, business
equipment or movable partitions or trade fixtures installed by Tenant or any subtenant of
Tenant, shall become the property of Landlord and shall remain and be surrendered with
the Premises as a part thereof at the expiration or earlier termination of this Lease
without compensation to Tenant.  </FONT></P>

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<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>10 </FONT></P>

<DIV STYLE="page-break-after:always"></DIV>
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<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>ARTICLE 12 </U> </FONT></P>

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<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>DISCHARGE OF LIENS</U> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U> Section
12.1 </U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Tenant shall not create or permit to be created any lien, encumbrance or charge
upon the Premises or any part or parts thereof or the income therefrom and shall not
enter into any security agreements or permit the filing of any financing statement
affecting any part of the Premises, and Tenant shall not suffer any other matter or thing
whereby the estate, rights and interest of Landlord in the Premises or any part thereof
might be impaired.  </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U> Section
12.2 </U> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If any mechanic&#146;s, laborer&#146;s or materialman&#146;s lien shall at any
time be filed against the Premises or any part thereof, Tenant shall, within thirty (30)
days after notice of the filing thereof, cause the same to be discharged of record. If
Tenant shall fail to cause such lien to be discharged within the period aforesaid, then,
in addition to any other right or remedy, Landlord may, but shall not be obligated to,
discharge the same either by paying the amount claimed to be due or by procuring the
discharge of such lien by deposit or by bonding proceedings, and in any such event
Landlord shall be entitled, if Landlord so elects, to compel the prosecution of an action
for the foreclosure of such lien by the lienor and to pay the amount of judgment in favor
of the lienor with interest, costs and allowances. Any amount so paid by Landlord with
all costs and expenses incurred by Landlord in connection therewith, together with
interest thereon at the Penalty Rate from the respective dates of Landlord&#146;s making
of the payment or incurring of the costs and expense, shall constitute additional rent
payable by Tenant under this Lease and shall be paid by Tenant to Landlord on demand.  </FONT></P>

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<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>ARTICLE 13 </U> </FONT></P>

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<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>EXISTING CONDITION
OF PREMISES</U> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Tenant
agrees to take possession of the Premises &#147;as is&#148; as of the date hereof. </FONT></P>

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<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>ARTICLE 14 </U> </FONT></P>

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<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>INDEMNIFICATION OF
LANDLORD<BR>LANDLORD NOT LIABLE FOR INJURY OR DAMAGE </U> </FONT></P>

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<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U> Section
14.1 </U> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Landlord shall not in any event whatsoever be liable for any injury or damage
to any property or to any person happening on, in or about the Premises and its
appurtenances, nor for any injury or damage to the Premises or to any property belonging
to Tenant or any other person which may be caused by any fire, breakage, leakage or
defect or by water, rain or snow that may leak into, issue or flow from any part of the
Premises or by the use, misuse or abuse of any of the elevators, hatches, openings,
installations, stairways or hallways, or which may arise from any other cause whatsoever.  </FONT></P>

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<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>11 </FONT></P>

<DIV STYLE="page-break-after:always"></DIV>
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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U> Section
14.2 </U> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Landlord shall not be liable for any failure of water supply, gas or electric
current or any other utility or service, nor for any injury or damage to any property or
person or to the Premises caused by or resulting from any such failure.  </FONT></P>

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<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>ARTICLE 15 </U> </FONT></P>

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<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>LANDLORD&#146;S
RIGHT OF INSPECTION</U> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Tenant
shall permit Landlord and its agents or representatives to enter the Premises on business
days during business hours upon reasonable notice to Tenant for the purpose of inspecting
the same. Notwithstanding anything to the contrary contained in the within Lease, Landlord
shall have the right to enter the Premises at any time in the event of an emergency to
make any necessary repairs at Tenant&#146;s cost and expense. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Center Underline" FSL="Default" -->
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>ARTICLE 16 </U> </FONT></P>

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<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>LANDLORD&#146;S
RIGHT TO PERFORM TENANT&#146;S COVENANTS</U> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If
Tenant shall at any time fail to pay any Imposition in accordance with the provisions
hereof, or to take out, pay for, maintain or deliver any of the insurance policies (or
certificates) provided for herein, or shall fail to make any other payment or perform any
other act on its part to be made or performed after the giving of notice if required
hereunder and the expiration of the applicable grace period, if any, except in the case of
emergency, then Landlord, without waiving or releasing Tenant from any obligation of
Tenant contained in this Lease, may (but shall be under no obligation to): </FONT></P>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;          pay
any Imposition payable by Tenant pursuant to the provisions hereof, or  </FONT>
</TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;          take
out, pay for and maintain any of the insurance policies provided for           herein, or  </FONT>
</TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;          make
any other payment or perform any other act on Tenant&#146;s part to be made           or
performed as in this Lease provided, and may enter upon the Premises for the
          purpose and take all such action thereon as may be necessary therefor.  </FONT>
</TD>
</TR>
</TABLE>
<BR>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;All
sums so paid by Landlord and all costs and expenses incurred by Landlord in connection
with the performance of any such act, together with interest thereon at the Penalty Rate
from the respective dates of Landlord&#146;s making of each such payment or incurring of
each such cost and expense shall be paid by Tenant to Landlord on demand. Any payment or
performance by Landlord pursuant to the foregoing provisions of this Article shall not be
nor be deemed to be a waiver or release of the breach or default of Tenant with respect
thereto or of the right of Landlord to terminate this Lease, institute summary proceedings
and/or take such other action as may be permissible hereunder in the event of breach or
default by Tenant. </FONT></P>

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<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>12 </FONT></P>

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<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>ARTICLE 17 </U> </FONT></P>

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<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>FEE MORTGAGES </U></FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This
Lease shall be subject and subordinate to each mortgage for security purposes which is a
lien, which may now or hereafter affect the Premises and to all, renewals, modifications
consolidations and replacements and extensions thereof provided however, that the
mortgagee or grantee of such conveyance for security purposes, shall agree that it and its
successors and assignes will, if at such time the Tenant is not in defaut under this Lease
and attorns to such person, recognize this Lease if the interest of the Landlord in the
Premises shall be ended by reason of forclosure proceedings or otherwise. This clause and
section shall be self-operative and no further instrument of subordination shall be
required by any mortgagee, beneficiary of such deed of trust or grantee of such conveyance
for security purposes. The Tenant agrees that the recording of such mortgage or mortgages
shall have preference and precedence and be superior and prior to the interest created by
this Lease irrespective of the date of recording and the Tenant agrees to execute any such
instrument without cost, which may be deemed necessary or desirable to further effect the
subordination of this Lease to any such mortgage or mortgages, and a refusal to execute
such instruments shall entitle the Landlord, their heirs, successors, assigns and legal
representatives to the option of canceling this Lease without incurring any expense or
damage, and the term hereby granted is expressly limited accordingly. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Tenant shall in conformation with the subordination provided for in the preceding section,
execute and deliver promptly any certificate or instrument in conforminty with the
provisions hereof which the Landlord may at any time request in connection herewith. The
Tenant hereby irrecovably constitutes and appoints the Landlord as its attorney-in-fact to
execute any such certificates for and on behalf of the Tenant. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Center Underline" FSL="Default" -->
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>ARTICLE 18 </U> </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Center Underline" FSL="Default" -->
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>PERMITTED USE; NO
UNLAWFUL OCCUPANCY</U> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Tenant shall use the Premises for any and all lawful purposes. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Center Underline" FSL="Default" -->
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>ARTICLE 19 </U> </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Center Underline" FSL="Default" -->
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>LATE CHARGES</U> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
the event payment of any sums required to be paid by Tenant to Landlord under this Lease
shall become overdue for ten (10) days beyond the date on which they are due and payable
as in this Lease provided without the benefit of any grace or notice provision, then sums
so overdue shall be payable on demand with interest at the Penalty Rate (commencing on
such due date and until so paid), as liquidated damages for Tenant&#146;s failure to make
prompt payment. Furthermore, if any installment of Fixed Net Rent or additional rent due
hereunder is not paid on or before the tenth (10th) day of the month during which such
installment is due, Tenant shall pay Landlord, as additional rent, on or before the first
day of the following month, </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Minor Center" FSL="Default" -->
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>13 </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>six cents for each dollar so overdue
in order to defray Landlord&#146;s administrative and other costs in connection with such
late payment. In the event of nonpayment of any late charges Landlord shall have, in
addition to all other rights and remedies, all of the rights and remedies provided for
herein and by law in the case of nonpayment of the Fixed Net Rent. No failure by Landlord
to insist upon the strict performance by Tenant of Tenant&#146;s obligations to pay late
charges shall constitute a waiver by Landlord of its rights to enforce the provisions of
this Section in any instance thereafter occurring. The provisions of this Article shall
not be construed in any way to extend the grace periods or notice periods provided for in
this Lease. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Center Underline" FSL="Default" -->
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>ARTICLE 20 </U> </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Center Underline" FSL="Default" -->
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>DEFAULTS,
CONDITIONAL LIMITATIONS, REMEDIES, ETC.</U> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U> Section
20.1 </U> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Each of the following events shall be an &#147;Event of Default&#148; hereunder:  </FONT></P>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Failure
of Tenant to pay or deposit any installment of Rental or any part                thereof
or any other payment of money, costs or expenses herein agreed to be                paid
by Tenant, when due, and the continuance of such failure for a period of
               fifteen (15) days after such amount is due and payable hereunder;  </FONT>
</TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;               Failure
of Tenant to observe or perform one or more of the other terms,
               conditions, covenants or agreements of this Lease and the continuance of
such                failure for a period of fifteen (15) days after written notice by
Landlord                specifying such failure (unless such failure requires work to be
performed, acts                to be done, or conditions to be removed which cannot by
their nature reasonably                be performed, done or removed, as the case may be,
within such fifteen (15) day                period, in which case no default shall be
deemed to exist so long as Tenant                shall have commenced curing the same
within such fifteen (15) day period and                shall diligently and continuously
prosecute the same to completion);  </FONT>
</TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;               (i)
the filing of an application by Tenant for a consent to the appointment of a
               receiver, trustee or liquidator of itself or of all of its assets; or (ii)
the                filing by Tenant of a voluntary petition in bankruptcy or the filing
of a                pleading in any court of record admitting in writing its inability to
pay its                debts as they become due; or (iii) the making by Tenant of a
general assignment                for the benefit of creditors; or (iv) the filing by
Tenant of an answer                admitting the material allegations of or consenting to
or defaulting in                answering a petition filed against it in any bankruptcy
proceeding;  </FONT>
</TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;               the
entry of an order, judgment or decree by any court of competent jurisdiction
               adjudging Tenant a bankrupt or appointing a receiver, trustee or
liquidator for                Tenant or its assets, which entry, judgment or decree has
not been overturned                within sixty (60) days;  </FONT>
</TD>
</TR>
</TABLE>
<BR>

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<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>14 </FONT></P>

<DIV STYLE="page-break-after:always"></DIV>
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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;               if
a levy under execution or attachment shall be made against Tenant or its or
               their property and such execution or attachment shall not be vacated or
removed                by court order, bonding or otherwise within a period of thirty
(30) days;  </FONT>
</TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f)
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;               if
Tenant shall be liquidated or dissolved, or shall begin proceedings toward
               such liquidation or dissolution, or shall, in any manner, permit the
divestiture                of substantially all its assets;  </FONT>
</TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g)
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;               if
Tenant shall vacate or abandon the Premises; or  </FONT>
</TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h)
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;               if
this Lease or the estate of Tenant hereunder shall be transferred to or
               assigned to or subleased to or shall pass to or devolve upon, any person
or                party, except in a manner herein permitted.  </FONT>
</TD>
</TR>
</TABLE>
<BR>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U> Section
20.2 </U> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If an Event of Default shall occur, Landlord, at any time thereafter, may at
its option give written notice to Tenant stating that this Lease and the term hereby
demised shall expire and terminate on the date specified in such notice, and upon the
date specified in such notice, this Lease and the term hereby demised and all rights of
the Tenant under this Lease shall expire and terminate as if that date were the date
herein definitely fixed for the termination of the term of this Lease, and Tenant shall
quit and surrender the Premises, but Tenant shall remain liable as hereinafter provided.  </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U> Section
20.3 </U> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If any Event of Default shall occur, Landlord may without notice re-enter and
repossess the Premises using such force for that purpose as may be necessary without
being liable to indictment, prosecution or damages therefor, and Tenant shall
nevertheless remain liable as hereinafter provided for the remainder of the term hereof.
If Landlord shall so re-enter, Landlord may, at its option, repair and alter the Premises
in such manner as to Landlord may seem necessary or advisable, and/or let or relet the
Premises or any parts thereof for the whole or any part of the remainder of the term
hereof or for a longer period, in Landlord&#146;s name or as agent of Tenant, and out of
any rent collected or received as a result of such reletting Landlord shall: first, pay
to itself the cost and expense of retaking, repossessing, repairing and/or altering the
Premises, and the cost and expense of removing all persons and property therefrom;
second, pay to itself the cost and expense sustained in securing any new tenants, and if
Landlord shall maintain and operate the Premises the cost and expense of operating and
maintaining the Premises; and, third, pay to itself any balance remaining on account of
the liability of Tenant to Landlord.  </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U> Section
20.4 </U> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Rental payable hereunder and each and every installment thereof, and all
costs, reasonable attorneys&#146; fees and other expenses which may be incurred by
Landlord in enforcing the provisions of this Lease or on account of any delinquency of
Tenant in carrying out the provisions of this Lease, shall be and they hereby are
declared to constitute a valid lien upon the interest of Tenant in this Lease and in the
Premises.  </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U> Section
20.5 </U> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Suit or suits for the recovery of such deficiency or damages, or for a sum
equal to any installment or installments of Rental, Impositions and other charges
hereunder, may be brought by Landlord from time to time at Landlord&#146;s election, and
nothing herein contained shall be deemed to require Landlord to await the date whereon
this Lease or the term hereof would have expired by limitation had there been no such
default by Tenant or termination.  </FONT></P>

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<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>15 </FONT></P>

<DIV STYLE="page-break-after:always"></DIV>
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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U> Section
20.6 </U> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Nothing in this Article contained shall limit or prejudice the right of
Landlord to prove and obtain as liquidated damages in any bankruptcy, insolvency,
receivership, reorganization or dissolution proceeding an amount equal to the maximum
allowed by a statute or rule of law governing such proceeding and in effect at the time
when such damages are to be proved, whether or not such amount be greater, equal to or
less than the amount of the damages referred to in any of the preceding subdivisions.  </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U> Section
20.7 </U>  &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;No receipt of moneys by Landlord from Tenant after termination of this Lease,
or after the giving of any notice of termination of this Lease, shall reinstate, continue
or extend the term of this Lease or affect any notice theretofore given to Tenant, or
operate as a waiver of the right of Landlord to enforce the payment of Rental and any
other sum or sums of money and other charges herein reserved and agreed to be paid by
Tenant then due or thereafter falling due, or operate as a waiver of the right of
Landlord to recover possession of the Premises by proper remedy, except as herein
otherwise expressly provided, it being agreed that after the service of notice to
terminate this Lease or the commencement of suit or summary proceedings, or after final
order or judgment for the possession of said premises, Landlord may demand, receive and
collect any moneys due or thereafter falling due without in any manner affecting such
notice, proceeding, order, suit or judgment, all such moneys collected being deemed
payments on account of the use and occupation of said Premises or, at the election of
Landlord, on account of Tenant&#146;s liability hereunder.  </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U> Section
20.8 </U>  &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;No failure by Landlord to insist upon the strict performance of any covenant,
agreement, term or condition of this Lease or to exercise any right or remedy consequent
upon a breach thereof, and no acceptance of full or partial rent by Landlord during the
continuance of any such breach, shall constitute a waiver of any such breach or of such
covenant, agreement, term or condition. No covenant, agreement, term or condition of this
Lease to be performed or complied with by Tenant, and no breach thereof, shall be waived,
altered or modified except by a written instrument executed by Landlord. No waiver of any
breach shall affect or alter this Lease, but each and every covenant, agreement, term and
condition of this Lease shall continue in full force and effect with respect to any other
then existing or subsequent breach thereof.  </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U> Section
20.9 </U> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Each right and remedy of Landlord provided for in this Lease shall be cumulative
and shall be in addition to every other right or remedy provided for in this Lease or now
or hereafter existing at law or in equity or by statute or otherwise, and the exercise or
beginning of the exercise by Landlord of any one or more of the rights or remedies
provided for in this Lease or now or hereafter existing at law or in equity or by statute
or otherwise, shall not preclude the simultaneous or later exercise by Landlord of any or
all other rights or remedies provided for in this Lease or now or hereafter existing at
law or in equity or by statute or otherwise.  </FONT></P>

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<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>16 </FONT></P>

<DIV STYLE="page-break-after:always"></DIV>
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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U> Section
20.10 </U>  &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Tenant shall pay to the Landlord all costs and expenses, including attorneys&#146; fees,
paid or incurred by Landlord in any action or proceeding to which Landlord may be made a
party by reason of any act or omission of Tenant. Tenant shall also pay to Landlord all
costs and expenses, including attorneys&#146; fees, paid or incurred by Landlord in
enforcing any of the covenants and provisions of this Lease and paid or incurred in any
action brought by Landlord against Tenant on account of the provisions hereof, and all
such costs, expenses, and attorneys&#146; fees may be included in and form a part of any
judgment entered in any proceeding brought by Landlord against Tenant on or under this
Lease. All of the sums paid or obligations incurred by Landlord as aforesaid with
interest (at the Penalty Rate) and costs shall be paid by Tenant to Landlord within
fifteen(15) days of the rendition by Landlord to Tenant of any bill or statement
therefor.  </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U> Section
20.11 </U> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In the event of a termination of this Lease by reason of default or breach by
Tenant hereunder (a) all unexpired insurance premiums, all deposits theretofore made by
Tenant with utility companies, all rights of Tenant under all insurance policies and all
fuel in the Premises shall be deemed to be assigned to and transferred to Landlord, and
(b) Tenant shall deliver to Landlord all leases of subtenants and all security deposits
and advance rentals then held by Tenant with respect to any and all subleases, and (c)
Tenant shall execute all documents required.  </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U> Section
20.12 </U> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;At any time after this Lease shall be terminated as aforesaid, Landlord shall
be entitled to recover from Tenant, and Tenant shall pay to Landlord, on demand, as and
for liquidated and agreed final damages for Tenant&#146;s default, an amount equal to (i)
any costs and expenses incurred by Landlord in connection with a reletting of the
Premises or any part thereof; and (ii) the difference between the Fixed Net Rent and all
other charges payable by Tenant hereunder for the unexpired portion of the term demised
and the then fair and reasonable rental value of the Premises for the same period.  </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
the computation of such damages, the difference between any installment of Rental
becoming due hereunder after the date of such termination and the fair and reasonable
rental value of the Premises for the period for which such installment was payable shall
be discounted from the Expiration Date to the date of termination at the rate of four
(4%) percent per annum. If the Premises or any part thereof be relet by the Landlord for
the unexpired term of this Lease, or any part thereof, before presentation of proof of
such liquidated damages to any court, commission or tribunal, the amount of rent reserved
upon such reletting shall, prima facie, be the fair and reasonable rental value for the
part or the whole of the Premises so relet during the term of the reletting.  </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Center Underline" FSL="Default" -->
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>ARTICLE 21 </U> </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Center Underline" FSL="Default" -->
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>NOTICES</U> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Whenever
it is provided herein that notice, demand, request or other communication shall or may be
given to or served upon either of the parties by the other, and whenever either of the
parties shall desire to give or serve upon the other any notice, demand, request or other
communication with respect hereto or the Land, each such notice, demand, request or other
communication shall be in writing and, any law or statute to the contrary notwithstanding,
shall be effective for any purpose if given or served as follows: </FONT></P>

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<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>17 </FONT></P>

<DIV STYLE="page-break-after:always"></DIV>
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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;               If
by Landlord, by mailing the same to Tenant by registered or certified mail
               postage prepaid, return receipt requested or by nationally recognized
overnight                delivery, addressed to Tenant at the address on page one of this
Lease, or at                such other address as Tenant may from time to time designate
by notice given to                Landlord by registered or certified mail with a copy to
to Schepisi &amp;               McLaughlin, 473 Sylvan Avenue, Englewood Cliffs, New
Jersey 07632.  </FONT>
</TD>
</TR>
</TABLE>
<BR>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;               If
by Tenant, by mailing the same to Landlord by registered or certified mail,
               postage prepaid, return receipt requested or by nationally recognized
overnight                delivery, addressed to Landlord at the address on page one of
this Lease, with a                copy to Soons &amp; Soons, 155 North Dean Street,
Englewood, New Jersey 07631                Attn: Matthew Cohen, Esq.or at such other
address as Landlord may from time to                time designate by notice given to
Tenant by registered or certified mail.  </FONT>
</TD>
</TR>
</TABLE>
<BR>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Every
notice, demand, request or other communication hereunder shall be deemed to have been
given or served (i) upon the date same shall have been received or receipt thereof has
been refused or rejected; or (ii) twenty-four (24) hours after the time that same shall
have been sent by Express Mail or nationally recognized overnight delivery service to the
addresses as aforesaid. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Center Underline" FSL="Default" -->
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>ARTICLE 22 </U> </FONT></P>

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<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>CONDEMNATION</U> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U> Section
22.1 </U>  &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If the whole of the Premises shall be acquired or condemned by eminent domain
for any public use or purpose, then and in that event the term of this Lease shall cease
and terminate from the date of title vesting in such proceeding and the Lessee shall have
no claim against the Landlord or against any award made as a result of such acquisition
or condemnation for the value of any unexpired term of said Lease.  </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U> Section
22.2 </U> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In the event of a partial taking the term of this Lease shall not cease and
terminated unless such partial taking materially affects the operation of the Premises
for the purposes of the Tenant&#146;s use. In the event of a partial taking lessee shall
be entitled to a reduction in rent as determined by the parties. In no event shall the
reduction be greater than taking the total number of square feet and dividing said total
into the annual rental in determining a per square foot value. In no way shall Tenant, in
the event of a partial or complete taking participate in any award made as a result of
such acquisition or condemnation nor have any claim against Landlord for the sum of any
unexpired term of said Lease. However, Lessee shall be entitled to prosecute its claim
for relocation expenses from the condemning authority, provided same does not affect the
Landlord&#146;s award in any manner.  </FONT></P>

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<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>18 </FONT></P>

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<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>ARTICLE 23 </U> </FONT></P>

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<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>SURRENDER AT END OF
TERM</U> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U> Section
23.1 </U>  &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;On the Expiration Date or upon any earlier termination of this Lease, or upon
an re-entry by Landlord upon the Premises upon Tenant&#146;s Default, Tenant shall well
and truly surrender and deliver up to Landlord the Premises in good order, condition and
repair, reasonable wear and tear excepted, free and clear of all lettings and
occupancies, and free and clear of all liens and encumbrances other than those, if any,
existing at the date hereof or created by Landlord or subsequent owners of the Premises,
without any payment or allowance whatever by Landlord.  </FONT></P>

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<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>ARTICLE 24 </U> </FONT></P>

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<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>QUIET ENJOYMENT</U> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Landlord
covenants that, if and so long as Tenant shall faithfully perform the agreements, terms,
covenants and conditions hereof, Tenant shall and may (subject, however, to the
exceptions, reservations, terms and conditions of this Lease) peaceably and quietly have,
hold and enjoy the Land for the term hereby granted without molestation or disturbance by
or from Landlord and free of any encumbrance created or suffered by Landlord, except those
to which this Lease is subject and subordinate. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Center Underline" FSL="Default" -->
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>ARTICLE 25 </U> </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Center Underline" FSL="Default" -->
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>INVALIDITY OF
CERTAIN PROVISIONS</U> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If
any term or provision of this Lease or the application thereof to any person or
circumstances shall, to any extent, be invalid or unenforceable, the remainder of this
Lease, or the application of such term or provision to persons or circumstances other than
those as to which it is held invalid or unenforceable, shall not be affected thereby, and
each term and provision of this Lease shall be valid and be enforced to the fullest extent
permitted by law. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Center Underline" FSL="Default" -->
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>ARTICLE 26 </U> </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Center Underline" FSL="Default" -->
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>REPRESENTATIONS</U> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Landlord
and Tenant represent that they have the authority to execute this Lease and that the
covenants and obligations shall be binding upon Landlord and Tenant. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Minor Center" FSL="Default" -->
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>19 </FONT></P>

<DIV STYLE="page-break-after:always"></DIV>
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<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>ARTICLE 27 </U> </FONT></P>

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<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>MISCELLANEOUS</U> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U> Section
27.1 </U> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The captions of this Lease are for convenience of reference only and in no way
define, limit or describe the scope or intent of this Lease or in any way affect this
Lease.  </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U> Section
27.2 </U> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The use herein of the neuter pronoun in any reference to Landlord or Tenant
shall be deemed to include any individual Landlord or Tenant, and the use herein of the
words &#147;successors and assigns&#148; or &#147;successors or assigns&#148; of Landlord
or Tenant shall be deemed to include the heirs, legal representatives and assigns of any
individual Landlord or Tenant.  </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U> Section
27.3 </U> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This Lease cannot be changed or terminated orally, but only by an instrument in
writing executed by the party against whom enforcement of any waiver, change,
modification or discharge is sought. This Lease shall be governed by the laws of the
State of New Jersey.  </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U> Section
27.4 </U> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The agreements, terms, covenants and conditions herein shall bind and inure to
the benefit of Landlord and Tenant and their respective heirs, personal representatives,
successors and (except as otherwise provided herein) assigns.  </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Center Underline" FSL="Default" -->
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>ARTICLE 28 </U> </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Center Underline" FSL="Default" -->
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>BROKER</U> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U> Section
28.1 </U> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;No Broker participated in the negotiation of the within Lease Tenant and
Landlord agree to indemnify and hold harmless the other against and from any costs,
expenses and liabilities (including reasonable attorneys&#146; fees and expenses)
resulting from any breach of the covenant and warranty contained herein or its
misrepresentation of the matters set forth herein.  </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Center Underline" FSL="Default" -->
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>ARTICLE 29 </U> </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Minor Center" FSL="Default" -->
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>NO MERGER</U> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;There
shall be no merger of Landlord&#146;s estate in the Premises with Tenant&#146;s estate
therein by reason of the fact that the same individual, partnership, firm or corporation
or other entity may acquire or own such estates directly or indirectly. No such merger
shall occur until all individuals, partnerships, firms, corporations and other entities
having any interest in such estates, including any holder of a Mortgage, join in a written
instrument effecting such merger and duly record such instrument. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Center Underline" FSL="Default" -->
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>ARTICLE 30</U> </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Center Underline" FSL="Default" -->
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>SECURITY</U> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Contemporaneously
with the execution hereof the Tenant shall deliver Fifty Four Thousand Dollars ($54,000)
to the Landlord (the &#147;Cash Deposit&#148;) as security for the full and faithful
performance and observance by Tenant of the terms, conditions and provisions of </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Minor Center" FSL="Default" -->
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>20 </FONT></P>

<DIV STYLE="page-break-after:always"></DIV>
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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>this lease. Tenant shall upon each
rental increase deliver to the Landlord additional security so that the Landlord shall
have three (3) months rent as the Cash Deposit for the remainder of the term of the Lease.
If Tenant is in default in performing or observing any term, provision or condition of
this Lease, including, without limitation, the payment of fixed rent or additional
charges, Landlord may apply or retain the whole or any part of the Cash Deposit so
deposited to the extent required for the payment of any fixed rent, additional rent,
Imposition or other sum as to which Tenant is in default or for any sum
which&#146;Landlord may expend or may be required to expend by reason of Tenant&#146;s
default in performing or observing any term, covenant or condition of this lease,
including, without limitation, any damages or deficiency in the reletting of the Demised
Premises. The Landlord shall have no obligation to segregate or hold in a separate account
the Security Deposit. At the end of the term of the Landlord shall return the Cash Deposit
to the Tenant. </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Center Underline" FSL="Default" -->
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>ARTICLE 31 </U> </FONT></P>

<!-- MARKER FORMAT-SHEET="Head Center Underline" FSL="Default" -->
<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>TENANT&#146;S OPTION
TO PURCHASE/TENANT&#146;S RIGHT OF FIRST OFFER</U> </FONT></P>

<!-- MARKER FORMAT-SHEET="Para Large Indent" FSL="Default" -->
<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U> Section
31.1 </U> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Provided this Lease is in full force and effect and has not been cancelled
pursuant to the provisions hereof, then Tenant may at Tenant&#146;s option purchase the
Premises upon the following conditions precedent:  </FONT></P>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;          Upon
the execution hereof the Tenant shall pay the Landlord a deposit in the           amount
of Two Hundred Thousand ($200,000.00) Dollars in consideration of the           option to
purchase. In the event that the Landlord does not close title to the
          Premises,or that the Tenant does not exercise the option such deposit shall be
          refunded to the Tenant upon the termination of the Lease. In the event that the
          Tenant shall exercise the option hereunder, the deposit shall be credited
toward           the purchase price.  </FONT>
</TD>
</TR>
</TABLE>
<BR>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;          Exercise of Option. The election of
Tenant to exercise this option (the           &#147;Option&#148;) must be evidenced by a
notice in writing in accordance with           Article 21 of this Lease, (b) a contract
of sale (the &#147;Contract&#148;) in           the form in the form reasonably
satisfactory to Landlord and Tenant, fully           executed by Tenant as purchaser,
providing for a date of Closing (as hereinafter           defined) not earlier than 60
days, and not later than 120 days after Tenant           exercises the Option, and (c) a
good unendorsed certified or bank check drawn on           a New Jersey or New York
commercial bank in the sum of 10% of the Purchase Price           (as hereinafter
defined), which amount shall represent the downpayment pursuant           to the
Contract. If Tenant elects to exercise the Option, such written notice,           the
executed Contract and check must each be delivered to Landlord on a date not
          later than one hundred twenty (120) days prior to the Expiration Date (with
time           being of the essence as to such date) or failing such delivery as
aforesaid the           Option shall terminate and become null and void without further
documentation.           If Tenant exercises the Option in accordance with the foregoing
terms, Landlord           shall execute and return the Contract to Tenant within fifteen
(15) days of           receipt.  </FONT>
</TD>
</TR>
</TABLE>
<BR>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Section
31.2      </U> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Purchase Price.  The purchase price under the option (the "Purchase Price")
shall be as follows: </FONT></P>


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<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>21 </FONT></P>

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<TABLE WIDTH=100% CELLPADDING=0 CELLSPACING=0>
<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;          if
the Closing (as hereinafter defined) occurs during the first Lease Year, the
          Purchase Price shall be Three Million Seventy Five Thousand Dollars
          ($3,075,000.00);  </FONT>
</TD>
</TR>
</TABLE>
<BR>

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<TR VALIGN=TOP>
<TD WIDTH=5%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp; </FONT></TD>
<TD WIDTH=95%><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;          if
the Closing occurs during the second or third Lease Years, the Purchase Price
          shall be Three Million Twenty Five Thousand Dollars ($3,025,000.00);  </FONT>
</TD>
</TR>
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<BR>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Throughout
the remainder of the term of the Lease, the Purchase Price will be increased by 150% of
the Consumer Price Index (&#147;CPI&#148;). The base date for the CPI will be the
3<SUP>rd</SUP> anniversary of the date hereof. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U> Section
31.3 </U> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Transfer of Title. The Premises shall be conveyed by Landlord to Tenant free and
clear of any Mortgages (except, at the option of Landlord and Tenant, as may be assumed
by Tenant) or other liens and subject only to the matters set forth in the Contract.  </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U> Section
31.4 </U> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Adjustments. Except for any adjustment of Fixed Net Rent, there shall be no
adjustments and pro rations of Impositions, insurance premiums, and similar items which
shall be the obligation of Tenant as of the date of the Closing in accordance with the
other provisions of this Lease.  </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U> Section
31.5 </U> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Exchange Property. Each of Landlord and Tenant acknowledges and agrees that the
other may desire to effect an exchange of the Owned Property for property of like-kind
and qualifying use (the &#147;Exchange Property&#148;) pursuant to Section 1031 of the
Code, the Treasury Regulations promulgated thereunder and Revenue Procedure 2000-37 (as
the same may be hereafter modified, the &#147;Reverse Exchange Rules&#148;).
Notwithstanding anything in this Agreement to the contrary, each of Landlord and Tenant
agrees that if the other (the &#147;Exchanging Party&#148;) decides to consummate a Code
Section 1031 exchange, such party shall cooperate with the Exchanging Party in effecting
such exchange, provided that the Exchanging Party gives the other at least ten (10) days
advance notice. The Exchanging Party shall, to the extent permitted under Applicable
Laws, have the right to effect a simultaneous exchange, a deferred tax-free exchange, or
a reverse exchange, all under Section 1031 of the Code, the Treasury Regulations
promulgated thereunder and Reverse Exchange Rules including, but not limited to, through
the use of a &#147;qualified intermediary&#148; within the meaning of Treasury
Regulations Section 1.1031(k)-1(g)(4) (hereafter a &#147;Qualified Intermediary&#148;),
as shall be selected by the Exchanging Party, or pursuant to a &#147;qualified exchange
accommodation agreement&#148;(&#147;QEAA&#148;) within the meaning of the Reverse
Exchange Rules, to which the Exchanging Party is a party. If the Exchanging Party desires
to effect any such exchange, the other party shall take such steps and execute such
documents as may be reasonably necessary to assist the Exchanging Party in this regard,
except that in no event will the other party be obligated to (i) acquire or take title to
any Exchange Property, or (ii) pay or apply any consideration in excess of the amounts,
or at any time sooner than, as required under this Agreement. In the event that the
Exchanging Party decides to consummate a deferred exchange, the other party agrees to (x)
permit the Exchanging Party to assign its interests in this Agreement to a Qualified
Intermediary as provided in Treasury Regulation Section 1.1031(k)-1(g)(4) on or before
Closing, and (y) pay the Purchase Price to such Qualified Intermediary. In the event the
Exchanging Party decides to consummate a reverse exchange, the other party agrees to (1)
permit the Exchanging Party to assign its interests in this Agreement to a Qualified
Intermediary as provided in Treasury  </FONT></P>

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<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>22 </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Regulation Section 1.1031(k)-1(g)(4)
on or before Closing, (2) assign its interests in this Agreement pursuant to the QEAA, so
long as it maintains all of the rights it otherwise had to acquire the Owned Property, (3)
permit any lease of the Owned Property pursuant to the QEAA, and (4) pay the Purchase
Price to such Qualified Intermediary or pursuant to the QEAA, as the case may be. If the
Exchanging Party effectuates a Code Section 1031 exchange, (A) the other party shall have
the rights and remedies as provided by this Agreement, (B) the other party shall not be
obligated to pay any amounts greater than the Purchase Price or incur any recourse debt
with respect to the Exchange Property or incur any other personal liability, (C) the other
party shall not be required to make any warranties or representations in addition to those
contained herein or perform any additional covenants in favor of the Exchanging Party or
any other person, and (D) costs, including reasonable attorneys&#146; fees, incurred by
the other party in relation to such exchange shall be reimbursed to such party by the
Exchanging Party on demand. In furtherance of the foregoing, the Exchanging Party shall be
permitted to take such steps and execute such documents as may be reasonably necessary to
effectuate an exchange qualifying under Code Section 1031. The Exchanging Party shall
indemnify and hold the other party harmless from and against any and all claims, costs, or
liabilities incurred by the other party to third parties arising out of or connected with
such the other party&#146;s cooperation with the exchange transaction contemplated by this
Paragraph 31.5. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;IN
WITNESS WHEREOF, Landlord and Tenant have executed this Lease as of the day and year first
above written. </FONT></P>


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     <TH><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH>
     <TH><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TH></TR>
<TR VALIGN=Bottom>
     <TD WIDTH=45% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2></FONT></TD>
     <TD WIDTH=55% ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>LANDLORD:</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>WITNESS:</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>195 SPRING VALLEY ASSOCIATES, LLC</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><BR>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>__________________________</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>/s/ Howard Kent</U></FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>By: Howard Kent, Member</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><BR>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>TENANT</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>WITNESS:</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>JACLYN, INC.</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>&nbsp;</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><BR>&nbsp;</FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>/s/ Anthony Christon</U></FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>/s/ Robert Chestnov</U></FONT></TD></TR>
<TR VALIGN=Bottom>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>Anthony Christon, CFO</FONT></TD>
     <TD ALIGN=LEFT><FONT FACE="Times New Roman, Times, Serif" SIZE=2>By: Robert Chestnov, President and CEO</FONT></TD></TR>
</TABLE>




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<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2>23 </FONT></P>


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<SEQUENCE>4
<FILENAME>ex99_01-08222006.htm
<DESCRIPTION>99.01
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<P ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B><U>Exhibit 99.01 </U></B></FONT></P>

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<P ALIGN=RIGHT><FONT FACE="Times New Roman, Times, Serif" SIZE="3"><B>News</B> </FONT><FONT FACE="Times New Roman, Times, Serif" SIZE="2"><BR>
Company Contact: Anthony
Christon <BR>Chief Financial Officer<BR>Jaclyn, Inc. <BR>(201) 868-9400</FONT> </P>

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<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>JACLYN, INC. REPORTS
PLANNED MOVE<BR>TO NEW HEADQUARTERS
FACILITY </U> </FONT></P>

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<P ALIGN=CENTER><FONT FACE="Times New Roman, Times, Serif" SIZE=2><U>FOR IMMEDIATE RELEASE</U> </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>West New York, NJ, August 22, 2006.............................Jaclyn,
Inc. (AMEX:JLN) today reported that it has entered into a lease agreement for a new
corporate office building, and plans to relocate the Company&#146;s executive offices from
West New York, NJ to Maywood, NJ later this year. The lease has a 10-year term, and grants
to the Company an option to purchase the building at any time during the term of the lease
at a purchase price not to exceed $3,075,000, plus increases based on a multiple of the
consumer price index. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>The other party to the lease
agreement is the<B> </B>prospective purchaser of the new corporate<B> </B>office building,
with the closing of the purchase expected to take place by the end of August, or shortly
thereafter. The Company intends to provide the prospective purchaser with $2,200,000 in
mortgage financing, to be secured by a first priority mortgage in favor of the Company on
the land, office building, and other customary rights of the mortgagor. Funds for the
mortgage financing will be provided by borrowings under the Company&#146;s bank loan
facility and from Jaclyn&#146;s own funds. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2>As previously disclosed, the Company
has entered into an option contract to sell its West New York office and warehouse
facility. The Company has recently agreed to an additional six-month extension under the
option contract in order to provide the purchaser more time to obtain necessary permits
and variances. While there is no assurance that the sale of the West New York facility will be
successfully concluded, the Company decided to relocate its corporate headquarters to a
more suitable, practical space and believe it is in the Company&#146;s best long-term
interest to relocate. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2><B><I>Note</I></B><I></I>: This press
release may contain forward-looking statements that are being made pursuant to the safe
harbor provisions of the Private Securities Litigation Reform Act of 1995. The
Company&#146;s actual performance and results may vary as a result of a number of risks,
uncertainties and other factors, both foreseen and unforeseen, including general economic
and business conditions, competition in the accessories and apparel markets, continuing
favorable sales patterns, pricing and consumer buying trends Additional uncertainty exists
for the potential negative impact that a recurrence of Sudden Acute Respiratory Syndrome
(&#147;SARS&#148;) or other potential widespread health hazards may have on our business
relative to production in the Far East and other countries in which we operate. </FONT></P>

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<P><FONT FACE="Times New Roman, Times, Serif" SIZE=2><I>Jaclyn, Inc. is a designer,
manufacturer and marketer of apparel, women&#146;s sleepwear, infants&#146;and
children&#146;s apparel, handbags, premium incentives and related accessories.</I>
Website: jaclyninc.com </FONT></P>


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