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Published: 2008-03-26

521 Fifth Avenue (New York, NY) Office Lease - 521 Fifth Avenue Associates and The Edison Project



                                                                      Lease 4-95
                         STANDARD FORM OF OFFICE LEASE
                    The Real Estate Board of New York, Inc.

AGREEMENT OF LEASE, dated as of the 4th day of April, 1995 between 521 FIFTH
AVENUE ASSOCIATES, a New York limited partnership, having an office at 521 Fifth
Avenue, New York, New York 10175, party of the first part, hereinafter referred
to as OWNER or LANDLORD, and THE EDISON PROJECT, L.P., a New York limited
partnership, having an office at 529 Fifth Avenue, New York, New York, party of
the second part, hereinafter referred to as TENANT,

WITNESSETH: Owner hereby leases to Tenant and Tenant hereby hires from Owner
that portion of the sixteenth (16th) floor as shown shaded on Exhibit 'A',
annexed hereto and made a part hereof (the 'demised premises) in the building
known as 521 Fifth Avenue (the 'building') in the Borough of Manhattan, City of
New York, for the term of TWO (2) YEARS AND THREE (3) MONTHS (or until such term
shall sooner cease and expire as hereinafter provided) to commence on the 1st
day of May, nineteen hundred and ninety-five, and to end on the 31st day of
July, nineteen hundred and ninety-seven, both dates inclusive, at an annual
rental rate of ONE HUNDRED SIXTY-SIX THOUSAND TWO HUNDRED SEVENTY-THREE AND
80/100 ($166,273.80) DOLLARS per annum, commencing on the Commencement Date,
which Tenant agrees to pay in lawful money of the United States which shall be
legal tender in payment of all debts and dues, public and private, at the time
of payment, in equal monthly installments in advance on the first day of each
month during said term, at the office of Owner or such other place as Owner may
designate, without any set off or deduction whatsoever, except that Tenant shall
pay the first __________ monthly installment(s) on the execution hereof (unless
this lease be a renewal).

         In the event that, at the commencement of the term of this lease, or
thereafter, Tenant shall be in default in the payment of rent to Owner pursuant
to the terms of another lease with Owner or with Owner's predecessor in
interest, Owner may at Owner's option and without notice to Tenant add the
amount of such arrears to any monthly installment of rent payable hereunder and
the same shall be payable to Owner as additional rent.

         The parties hereto, for themselves, their heirs, distributees,
executors, administrators, legal representatives, successors and assigns, hereby
covenant as follows:

Rent Occupancy:

         1. Tenant shall pay the rent as above and as hereinafter provided.

         2. Tenant shall use and occupy demised premises for executive and
administrative offices in connection with Tenant's business and consistent with
a first-class office building, and for no other purpose.

Tenant Alternations:

         3. Tenant shall make no changes in or to the demised premises of any
nature without Owner's prior written consent. Subject to the prior written
consent of Owner, and to the provisions of this article, Tenant at Tenant's
expense, may make alterations, installations, additions or improvements which
are nonstructural and which do not affect utility services or plumbing and
electrical lines, in or to the interior of the demised premises by using
contractors or mechanics first approved by Owner. Tenant shall, before making
any alterations, additions, installations or improvements, at its expense,
obtain all permits, approvals and certificates required by any governmental or
quasi-governmental bodies and (upon completion) certificates of final approval
thereof and shall deliver promptly duplicates of all such permits, approvals and
certificates to Owner and Tenant agrees to carry and will cause Tenant's
contractors and sub-contractors to carry such workman's compensation, general
liability, personal and property damage insurance as Owner may require. If any
mechanic's lien is filed against the demised premises, or the building of which
the same forms a part, for work claimed to have been done for, or materials
furnished to, Tenant, whether or not done pursuant to this article, the same
shall be discharged by Tenant within thirty days thereafter, at Tenant's
expense, by filing the bond required by law. All fixtures and all paneling,
partitions, railings and like installations, installed in the premises at any
time, either by Tenant or by Owner in Tenant's behalf, shall, upon installation,
become the property of Owner and shall remain upon and be surrendered with the
demised premises unless Owner, by notice to Tenant no later than twenty days
prior to the date fixed as the termination of this lease, elects to relinquish
Owner's right thereto and to have them removed by Tenant, in which event the
same shall be removed from the premises by Tenant prior to the expiration of the
lease, at Tenant's expense. Nothing in this Article shall be construed to give
Owner title to or to prevent Tenant's removal of trade fixtures, moveable office
furniture and equipment, but upon removal of any such from the premises or upon
removal of other installations as may be required by Owner, Tenant shall
immediately and at its expense, repair and restore the premises to the condition
existing prior to installation and repair any damage to the demised premises or
the building due to such removal. All property permitted or required to be
removed, by Tenant at the end of the term remaining in the premises after
Tenant's removal shall be deemed abandoned and may, at the election of Owner,
either be retained as

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Owner's property or may be removed from the premises by Owner, at Tenant's
expense.  (See Article 42)

Maintenance and Repairs:

         4. Tenant shall, throughout the term of this lease, take good care of
the demised premises and the fixtures and appurtenances therein. Tenant shall be
responsible for all damage or injury to the demised premises or any other part
of the building and the systems and equipment thereof, whether requiring
structural or nonstructural repairs caused by or resulting from carelessness,
omission, neglect or improper conduct of Tenant. Tenant's subtenants, agents,
employees, invitees or licensees, or which arise out of any work, labor, service
or equipment done for or supplied to Tenant or any subtenant or arising out of
the installation, use or operation of the property or equipment of Tenant or any
subtenant. Tenant shall also repair all damage to the building and the demised
premises caused by the moving of Tenant's fixtures, furniture and equipment.
Tenant shall promptly make, at Tenant's expense, all repairs in and to the
demised premises for which Tenant is responsible, using only the contractor for
the trade or trades in question, selected from a list of at least two
contractors per trade submitted by Owner. Any other repairs in or to the
building or the facilities and systems thereof for which Tenant is responsible
shall be performed by Owner at the Tenant's expense. Owner shall maintain in
good working order and repair the exterior and the structural portions of the
building, including the structural portions of its demised premises, and the
public portions of the building interior and the building plumbing, electrical,
heating and ventilating systems (to the extent such systems presently exist)
serving the demised premises. Tenant agrees to give prompt notice of any
defective condition in the premises for which Owner may be responsible
hereunder. There shall be no allowance to Tenant for diminution of rental value
and no liability on the part of Owner by reason of inconvenience, annoyance or
injury to business arising from Owner or others making repairs, alterations,
additions or improvements in or to any portion of the building or the demised
premises or in and to the fixtures, appurtenances or equipment thereof. It is
specifically agreed that Tenant shall not be entitled to any setoff or reduction
of rent by reason of any failure of Owner to comply with the covenants of this
or any other article of this Lease. Tenant agrees that Tenant's sole remedy at
law in such instance will be by way of an action for damages for breach of
contract. The provisions of this Article 4 shall not apply in the case of fire
or other casualty which are dealt with in Article 9 hereof.

Window Cleaning:

         5. Tenant will not clean nor require, permit, suffer or allow any
window in the demised premises to be cleaned from the outside in violation of
Section 202 of the Labor Law or any other applicable law or of the Rules of the
Board of Standards and Appeals, or of any other Board or body having or
asserting jurisdiction.

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Requirements of Law, Fire Insurance, Floor Loads:

         6. Prior to the commencement of the lease term, if Tenant is then in
possession, and at all times thereafter, Tenant, at Tenant's sole cost and
expense, shall promptly comply with all present and future laws, orders and
regulations of all state, federal, municipal and local governments, departments,
commissions and boards and any direction of any public officer pursuant to law,
and all orders, rules and regulations of the New York Board of Fire
Underwriters, Insurance Services Office, or any similar body which shall impose
any violation, order or duty upon Owner or Tenant with respect to the demised
premises, whether or not arising out of Tenant's use of manner or use thereof,
(including Tenant's permitted use) or, with respect to the building if arising
out of Tenant's use or manner of use of the premises or the building (including
the use permitted under the lease). Nothing herein shall require Tenant to make
structural repairs or alterations unless Tenant has, by its manner of use of the
demised premises or method of operation therein, violated any such laws,
ordinances, orders, rules, regulations or requirements with respect thereto.
Tenant may, after securing Owner to Owner's satisfaction against all damages,
interest, penalties and expenses, including, but not limited to, reasonably
attorney's fees, by cash deposit or by surety bond in an amount and in a company
satisfactory to Owner, contest and appeal any such laws, ordinances, orders,
rules, regulations or requirements provided same is done with all reasonable
promptness and provided such appeal shall not subject Owner to prosecution for a
criminal offense or constitute a default under any lease or mortgage under which
Owner may be obligated, or cause the demised premises or any part thereof to be
condemned or vacated. Tenant shall not do or permit any act or thing to be done
in or to the demised premises which is contrary to law, or which will invalidate
or be in conflict with public liability, fire or other policies of insurance at
any time carried by or for the benefit of Owner with respect to the demised
premises or the building of which the demised premises form a part, or which
shall or might subject Owner to any liability or responsibility to any person or
for property damage. Tenant shall not keep anything in the demised premises
except as now or hereafter permitted by the Fire Department, Board of Fire
Underwriters, Fire Insurance Rating Organization or other authority having
jurisdiction, and then only in such manner and such quantity so as not to
increase the rate for fire insurance applicable to the building, nor use the
premises in a manner which will increase the insurance rate for the building or
any property located therein over that in effect prior to the commencement of
Tenant's occupancy. Tenant shall pay all costs, expenses, fines, penalties, or
damages, which may be imposed upon Owner by reason of Tenant's failure to comply
with the provisions of this article and if by reason of such failure the fire
insurance rate shall, at the beginning of this lease or at any time thereafter,
be higher than it otherwise would be, then Tenant shall reimburse Owner, as
additional rent hereunder, for that portion of all fire insurance premiums
thereafter paid by Owner which shall have been charged because of such failure
by Tenant. In any action or proceeding wherein

                                      - 4 -

Owner and Tenant are parties, a schedule or 'make-up' of rate for the building
or demised premises issued by the New York Fire Insurance Exchange, or other
body making fire insurance rates applicable to said premises shall be conclusive
evidence of the facts therein stated and of the several items and charges in the
fire insurance rates then applicable to said premises. Tenant shall not place a
load upon any floor of the demised premises exceeding the floor load per square
foot area which it was designed to carry and which is allowed by law. Owner
reserves the right to prescribe the weight and position of all safes, business
machines and mechanical equipment. Such installations shall be placed and
maintained by Tenant, at Tenant's expense, in settings sufficient, in Owner's
judgment, to absorb and prevent vibration, noise and annoyance. (See Article 47)

Subordination:

         7. This lease is subject and subordinate to all ground or underlying
leases and to all mortgages which may now or hereafter affect such leases or the
real property of which demised premises are a part and to all renewals,
modifications, consolidations, replacements and extensions of any such
underlying leases and mortgages. This clause shall be self-operative and no
further instrument of subordination shall be required by any ground or
underlying lessor or by any mortgagee, affecting any lease or the real property
of which the demised premises are a part. In confirmation of such subordination,
Tenant shall execute promptly any certificate that Owner may request.

Property-Loss, Damage, Reimbursement, Indemnity:

         8. Owner or its agents shall not be liable for any damage to property
of Tenant or of others entrusted to employees of the building, nor for loss of
or damage to any property of Tenant by theft or otherwise, nor for any injury or
damage to persons or property resulting from any cause of whatsoever nature,
unless caused by or due to the negligence of Owner, its agents, servants or
employees. Owner or its agents will not be liable for any such damage caused by
other tenants or persons in, upon or about said building or caused by operations
in construction of any private, public or quasi public work. If at any time any
windows of the demised premises are temporarily closed, darkened or bricked up
(or permanently closed, darkened or bricked up, if required by law for any
reason whatsoever including, but not limited to Owner's own acts. Owner shall
not be liable for any damage Tenant may sustain thereby and Tenant shall not be
entitled to any compensation therefor nor abatement or diminution of rent nor
shall the same release Tenant from its obligations hereunder nor constitute an
eviction. Tenant shall indemnify and save harmless Owner against and from all
liabilities, obligations, damages, penalties, claims, costs and expenses for
which Owner shall not be reimbursed by insurance, including reasonable attorneys
fees, paid, suffered or incurred as a result of any breach by Tenant, Tenant's
agents, contractors, employees, invitees, or licensees, of any covenant

                                      - 5 -

or condition of this lease, or the carelessness, negligence or improper conduct
of the Tenant, Tenant's agents, contractors, employees, invitees or licensees.
Tenant's liability under this lease extends to the acts and omissions of any
sub-tenant, and any agent, contractor, employee, invitee or licensee of any
sub-tenant. In case any action or proceeding is brought against Owner by reason
of any such claim, Tenant, upon written notice from Owner, will, at Tenant's
expense, resist or defend such action or proceeding by counsel approved by Owner
in writing, such approval not to be unreasonably withheld.

Destruction, Fire and Other Casualty:

         9. (a) If the demised premises or any part thereof shall be damaged by
fire or other casualty, Tenant shall give immediate notice thereof to Owner and
this lease shall continue in full force and effect except as hereinafter set
forth. (b) If the demised premises are partially damaged or rendered partially
unusable by fire or other casualty, the damages thereto shall be repaired by and
at the expense of Owner and the rent, until such repair shall be substantially
completed, shall be apportioned from the day following the casualty according to
the part of the premises which is usable. (c) If the demised premises are
totally damaged or rendered wholly unusable by fire or other casualty, then the
rent shall be proportionately paid up to the time of the casualty and
thenceforth shall cease until the date when the premises shall have been
repaired and restored by Owner, subject to Owner's right to elect not to restore
the same as hereinafter provided. (d) If the demised premises are rendered
wholly unusable or (whether or not the demised premises are damaged in whole or
in part) if the building shall be so damaged that Owner shall decide to demolish
it or to rebuild it, then, in any of such events, Owner may elect to terminate
this lease by written notice to Tenant, given within 90 days after such fire or
casualty, specifying a date for the expiration of the lease, which date shall
not be more than 60 days after the giving of such notice, and upon the date
specified in such notice the term of this lease shall expire as fully and
completely as if such date were the date set forth above for the termination of
this lease and Tenant shall forthwith quit, surrender and vacate the premises
without prejudice however, to Landlord's rights and remedies against Tenant
under the lease provisions in effect prior to such termination, and any rent
owing shall be paid up to such date and any payments of rent made by Tenant
which were on account of any period subsequent to such date shall be returned to
Tenant. Unless Owner shall serve a termination notice as provided for herein,
Owner shall make the repairs and restorations under the conditions of (b) and
(c) hereof, with all reasonable expedition, subject to delays due to adjustment
of insurance claims, labor troubles and causes beyond Owner's control. After any
such casualty, Tenant shall cooperate with Owner's restoration by removing from
the premises as promptly as reasonably possible, all of Tenant's salvageable
inventory and movable equipment, furniture, and other property. Tenant's
liability for rent shall resume five (5) days after written notice from Owner
that the premises are substantially ready for Tenant's occupancy. (e) Nothing
contained hereinabove shall

                                      - 6 -

relieve Tenant from liability that may exist as a result of damage from fire or
other casualty. Notwithstanding anything contained to the contrary contained in
subdivisions (a) through (e) hereof, each party shall look first to any
insurance in its favor before making any claim against the other party for
recovery for loss or damage resulting from fire or other casualty, and to the
extent that such insurance is in force and collectible and to the extent
permitted by law, Owner and Tenant each hereby releases and waives all right of
recovery against the other or any one claiming through or under each of them by
way of subrogation or otherwise. The foregoing release and waiver shall be in
force only if both releasors' insurance policies contain a clause providing that
such a release or waiver shall not invalidate the insurance. If, and to the
extent, that such waiver can be obtained only by the payment of additional
premiums, then the party benefitting from the waiver shall pay such premium
within ten days after written demand or shall be deemed to have agreed that the
party obtaining insurance coverage shall be free of any further obligation under
the provisions hereof with respect to waiver of subrogation. Tenant acknowledges
that Owner will not carry insurance on Tenant's furniture and/or furnishings or
any fixtures or equipment, improvements, or appurtenances removable by Tenant
and agrees that Owner will not be obligated to repair any damage thereto or
replace the same. (f) Tenant hereby waives the provisions of Section 227 of the
Real Property Law and agrees that the provisions of this article shall govern
and control in lieu thereof.

Eminent Domain:

         10. If the whole or any part of the demised premises shall be acquired
or condemned by Eminent Domain for any public or quasi 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 Tenant shall have no claim for
the value of any unexpired term of said lease and assigns to Owner, Tenant's
entire interest in any such award.

Assignment, Mortgage, Etc.:

         11. Tenant, for itself, its heirs, distributees, executors,
administrators, legal representatives, successors and assigns, expressly
covenants that it shall not assign, mortgage or encumber this agreement, nor
underlet, or suffer or permit the demised premises or any part thereof to be
used by others, without the prior written consent of Owner in each instance.
Transfer of the majority of the stock of a corporate Tenant shall be deemed an
assignment. If this lease be assigned, or if the demised premises or any part
thereof be underlet or occupied by anybody other than Tenant, Owner may, after
default by Tenant, collect rent from the assignee, under-tenant or occupant, and
apply the net amount collected to the rent herein reserved, but no such
assignment, underletting, occupancy or collection shall be deemed a waiver of
this covenant, or the acceptance of the assignee, under-tenant or occupant as
tenant, or a

                                      - 7 -

release of Tenant from the further performance by Tenant of covenants on the
part of Tenant herein contained. The consent by Owner to an assignment or
underletting shall not in any wise be construed to relieve Tenant from obtaining
the express consent in writing of Owner to any further assignment or
underletting. (See Article 41).

Electric Current:

         12. Rates and conditions in respect to submetering or rent inclusion,
as the case may be, to be added in RIDER attached hereto. Tenant covenants and
agrees that at all times its uses of electric current shall not exceed the
capacity of existing feeders to the building or the risers or wiring
installation and Tenant may not use any electrical equipment which, in Owner's
opinion, reasonably exercised, will overload such installations or interfere
with the use thereof by other tenants of the building. The change at any time of
the character of electric service shall in no wise make Owner liable or
responsible to Tenant, for any loss, damages or expenses which Tenant may
sustain. (See Article 46)

Access to Premises:

         13. Owner or Owner's agents shall have the right (but shall not be
obligated) to enter the demised premises in any emergency at any time, and, at
other reasonable times, to examine the same and to make such repairs,
replacements and improvements as Owner may deem necessary and reasonably
desirable to the demised premises or to any other portion of the building or
which Owner may elect to perform. Tenant shall permit Owner to use and maintain
and replace pipes and conduits in and through the demised premises and to erect
new pipes and conduits therein provided they are concealed within the walls,
floor, or ceiling. Owner may, during the progress of any work in the demised
premises, take all necessary materials and equipment into said premises without
the same constituting an eviction nor shall the Tenant be entitled to any
abatement of rent while such work is in progress nor to any damages by reason or
loss or interruption of business or otherwise. Throughout the term hereof Owner
shall have the right to enter the demised premises at reasonable hours for the
purpose of showing the same to prospective purchasers or mortgagees of the
building, and during the last six months of the term for the purpose of showing
the same to prospective tenants. If Tenant is not present to open and permit an
entry into the premises, Owner or Owner's agents may enter the same whenever
such entry may be necessary or permissible by master key or forcibly and
provided reasonable care is exercised to safeguard Tenant's property, such entry
shall not render Owner or its agents liable therefor, nor in any event shall the
obligations of Tenant hereunder be affected. If during the last month of the
term Tenant shall have removed all or substantially all of Tenant's property
therefrom, Owner may immediately enter, alter, renovate or redecorate the
demised premises without limitation or abatement of rent, or incurring liability
to Tenant for

                                      - 8 -

any compensation and such act shall have no effect on this lease or Tenant's
obligations hereunder.

Vault, Vault Space, Area:

         14. No Vaults, vault space or area, whether or not enclosed or covered,
not within the property line of the building is leased hereunder, anything
contained in or indicated on any sketch, blue print or plan, or anything
contained elsewhere in this lease to the contrary notwithstanding. Owner makes
no representation as to the location of the property line of the building. All
vaults and vault space and all such areas not within the property line of the
building, which Tenant may be permitted to use and/or occupy, is to be used
and/or occupied under a revocable license, and if any such license be revoked,
or if the amount of such space or area be diminished or required by any federal,
state or municipal authority or public utility, Owner shall not be subject to
any liability nor shall Tenant be entitled to any compensation or diminution or
abatement of rent, nor shall such revocation, diminution or requisition be
deemed constructive or actual eviction. Any tax, fee or charge of municipal
authorities for such vault or area shall be paid by Tenant.

Occupancy:

         15. Tenant will not at any time use or occupy the demised premises in
violation of the certificate of occupancy issued for the building of which the
demised premises are a part. Tenant has inspected the premises and accepts them
as is, subject to the riders annexed hereto with respect to Owner's work, if
any. In any event, Owner makes no representations as to the condition of the
premises and Tenant agrees to accept the same subject to violations, whether or
not of record.

Bankruptcy:

         16. (a) Anything elsewhere in this lease to the contrary
notwithstanding, this lease may be cancelled by Owner by the sending of a
written notice to Tenant within a reasonable time after the happening of any one
or more of the following events: (1) the commencement of a case in bankruptcy or
under the laws of any state naming Tenant as the debtor; or (2) the making by
Tenant of an assignment or any other arrangement for the benefit of creditors
under any state statute. Neither Tenant nor any person claiming through or under
Tenant, or by reason of any statute or order of court, shall thereafter be
entitled to possession of the premises demised but shall forthwith quit and
surrender the premises. If this lease shall be assigned in accordance with its
terms, the provisions of this Article 16 shall be applicable only to the party
then owning Tenant's interest in this lease. (b) It is stipulated and agreed
that in the event of the termination of this lease pursuant to (a) hereof, Owner
shall forthwith, notwithstanding any other provisions of this lease to the
contrary, be entitled to recover from Tenant as and for liquidated damages an
amount equal to

                                      - 9 -

the difference between the rent reserved hereunder for the unexpired portion of
the term demised and the fair and reasonable rental value of the demised
premises for the same period. In the computation of such damages the difference
between any installment of rent becoming due hereunder after the date of
termination and the fair and reasonable rental value of the demised premises for
the period for which such installment was payable shall be discounted to the
date of termination at the rate of four percent (4%) per annum. If such premises
or any part thereof be relet by the Owner for the unexpired term of said 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 be deemed to be the fair and reasonable rental value for the
part or the whole of the premises so re-let during the term of the re-letting
shall be deemed to be the fair and reasonable rental value for the part or the
whole of the premises so re-let during the term of the re-letting. Nothing
herein contained shall limit or prejudice the right of the Owner to prove for
and obtain as liquidated damages by reason of such termination, an amount equal
to the maximum allowed by any statute or rule of law in effect at the time when,
and governing the proceedings in which, such damages are to be proved, whether
or not such amount be greater, equal to, or less than the amount of the
difference referred to above. (See Article 55)

Default:

         17. (1) If Tenant defaults in fulfilling any of the covenants of this
lease other than the covenants for the payment of rent or additional rent; or if
the demised premises becomes vacant or deserted; or if any execution or
attachment shall be issued against Tenant or any of Tenant's property whereupon
the demised premises shall be taken or occupied by someone other than Tenant; or
if this lease be rejected under Section 365 of Title 11 of the U.S. Code
(bankruptcy code); or if Tenant shall fail to move into or take possession of
the premises within fifteen (15) days after the commencement of the term of this
lease or if Tenant shall be in default under any other lease for space in the
building, then, in any one or more of such events, upon Owner serving a written
five (5) days notice upon Tenant specifying the nature of said default and upon
the expiration of said five (5) days, if Tenant shall have failed to comply with
or remedy such default, or if the said default or omission complained of shall
be of a nature that the same cannot be completely cured or remedied within said
five (5) day period, and if Tenant shall not have diligently commenced during
such default within such five (5) day period, and shall not thereafter with
reasonable diligence and in good faith, proceed to remedy or cure such default,
then Owner may serve a written three (3) days' notice of cancellation of this
lease upon Tenant, and upon the expiration of said three (3) days this lease and
the term thereunder shall end and expire as fully and completely as if the
expiration of such three (3) day period were the day herein definitely fixed for
the end and expiration of this lease and the term thereof and Tenant shall then
quit and surrender the demised premises to Owner but Tenant shall remain liable
as hereinafter provided.

                                     - 10 -

                  (2) If the notice provided for in (1) hereof shall have been
given, and the term shall expire as aforesaid; or if Tenant shall make default
in the payment of the rent reserved herein or any item of additional rent herein
mentioned or any part of either or in making any other payment herein required,
then and in any of such events Owner may without notice, re-enter the demised
premises either by force or otherwise, and dispossess Tenant by summary
proceedings or otherwise, and the legal representative of Tenant or other
occupant of demised premises and remove their effects and hold the premises as
if this lease had not been made, and Tenant hereby waives the service of notice
of intention to re-enter or to institute legal proceedings to that end. If
Tenant shall make default hereunder prior to the date fixed as the commencement
of any renewal or extension of this lease, Owner may cancel and terminate such
renewal or extension agreement by written notice.

Remedies of Owner and Waiver of Redemption:

         18. In case of any such default, re-entry, expiration and/or dispossess
by summary proceedings or otherwise, (a) the rent shall become due thereupon and
be paid up to the time of such re-entry, dispossess and/or expiration, (b) Owner
may re-let the premises or any part or parts thereof, either in the name of
Owner or otherwise, for a term or terms, which may at Owner's option be less
than or exceed the period which would otherwise have constituted the balance of
the term of this lease and may grant concessions or free rent or charge a higher
rental than that in this lease, and/or (c) Tenant or the legal representatives
of Tenant shall also pay Owner as liquidated damages for the failure of Tenant
to observe and perform said Tenant's covenants herein contained, any deficiency
between the rent hereby reserved and/or covenanted to be paid and the net
amount, if any, of the rents collected on account of the lease or leases of the
demised premises for each month of the period which would otherwise have
constituted the balance of the term of this lease. The failure of Owner to
re-let the premises or any part or parts thereof shall not release or affect
Tenant's liability for damages. In computing such liquidated damages there shall
be added to the said deficiency such expenses as Owner may incur in connection
with re-letting, such as legal expenses, attorneys' fees, brokerage, advertising
and for keeping the demised premises in good order or for preparing the same for
re-letting. Any such liquidated damages shall be paid in monthly installments by
Tenant on the rent day specified in this lease and any suit brought to collect
the amount of the deficiency for any month shall not prejudice in any way the
rights of Owner to collect the deficiency of any subsequent month by a similar
proceeding. Owner, in putting the demised premises in good order or preparing
the same for re-rental may, at Owner's option, make such alterations, repairs,
replacements, and/or decorations in the demised premises as Owner, in Owner's
sole judgment, considers advisable and necessary for the purpose of re-letting
the demised premises, and the making of such alterations, repairs, replacements,
and/or decorations shall not operate or be construed to release Tenant from
liability

                                     - 11 -

hereunder as aforesaid. Owner shall in no event be liable in any way whatsoever
for failure to re-let the demised premises, or in the event that the demised
premises are re-let, for failure to collect the rent thereof under such
re-letting, and in no event shall Tenant be entitled to receive any excess, if
any, of such net rents collected over the sums payable by Tenant to Owner
hereunder. In the event of a breach or threatened breach by Tenant of any of the
covenants or provisions hereof, Owner shall have the right of injunction and the
right to invoke any remedy allowed at law or in equity as if re-entry, summary
proceedings and other remedies were not herein provided for. Mention in this
lease of any particular remedy, shall not preclude Owner from any other remedy,
in law or in equity. Tenant hereby expressly waives any and all rights of
redemption granted by or under any present or future laws in the event of Tenant
being evicted or dispossessed for any cause, or in the event of Owner obtaining
possession of demised premises, by reason of the violation by Tenant of any of
the covenants and conditions of this lease, or otherwise.

Fees and Expenses:

         19. If Tenant shall default in the observance or performance of any
term or covenant on Tenant's part to be observed or performed under or by virtue
of any of the terms or provisions in any article of this lease, then, unless
otherwise provided elsewhere in this lease, Owner may immediately or at any time
thereafter and without notice perform the obligation of Tenant thereunder. If
Owner, in connection with the foregoing or in connection with any default by
Tenant in the covenant to pay rent hereunder, makes any expenditures or incurs
any obligations for the payment of money, including but not limited to
attorney's fees, in instituting, prosecuting or defending any action or
proceeding, then Tenant will reimburse Owner for such sums so paid or
obligations incurred with interest and costs. The foregoing expenses incurred by
reason of Tenant's default shall be deemed to be additional rent hereunder and
shall be paid by Tenant to Owner within five (5) days of rendition of any bill
or statement to Tenant therefor. If Tenant's lease term shall have expired at
the time of making of such expenditures or incurring of such obligations, such
sums shall be recoverable by Owner as damages.

Building Alterations and Management:

         20. Owner shall have the right at any time without the same
constituting an eviction and without incurring liability to Tenant therefor to
change the arrangement and/or location of public entrances, passageways, doors,
doorways, corridors, elevators, stairs, toilets or other public parts of the
building and to change the name, number or designation by which the building may
be known. There shall be no allowance to Tenant for diminution of rental value
and no liability on the part of Owner by reason of inconvenience, annoyance or
injury to business arising from Owner or other Tenants making any repairs in the
building or any such alterations, additions and improvements. Furthermore,
Tenant shall not have any claim against

                                     - 12 -

Owner by reason of Owner's imposition of such controls of the manner of access
to the building by Tenant's social or business visitors as the Owner may deem
necessary for the security of the building and its occupants.

No Representations by Owner:

         21. Neither Owner nor Owner's agents have made any representations or
promises with respect to the physical condition of the building, the land upon
which it is erected or the demised premises, the rents, leases, expenses of
operation or any other matter or thing affecting or related to the premises
except as herein expressly set forth and no rights, easements or licenses are
acquired by Tenant by implication or otherwise except as expressly set forth in
the provisions of this lease. Tenant has inspected the building and the demised
premises and is thoroughly acquainted with their condition and agrees to take
the same 'as is' and acknowledges that the taking of possession of the demised
premises by Tenant shall be conclusive evidence that the said premises and the
building of which the same form a part were in good and satisfactory condition
at the time such possession was so taken, except as to latent defects. All
understandings and agreements heretofore made between the parties hereto are
merged in this contract, which alone fully and completely expresses the
agreement between Owner and Tenant and any executory agreement hereafter made
shall be ineffective to change, modify, discharge or effect an abandonment of it
in whole or in part, unless such executory agreement is in writing and signed by
the party against whom enforcement of the change, modification, discharge or
abandonment is sought.

End of Term:

         22. Upon the expiration or other termination of the term of this lease,
Tenant shall quit and surrender to Owner the demised premises, broom clean, in
good order and condition, ordinary wear and damages which Tenant is not required
to repair as provided elsewhere in this lease excepted, and Tenant shall remove
all its property. Tenant's obligation to observe or perform this covenant shall
survive the expiration or other termination of this lease. If the last day of
the term of this Lease or any renewal thereof, falls on Sunday, this lease shall
expire at noon on the preceding Saturday unless it be a legal holiday in which
case it shall expire at noon on the preceding business day.

Quiet Enjoyment:

         23. Owner covenants and agrees with Tenant that upon Tenant paying the
rent and additional rent and observing and performing all the terms, covenants
and conditions, on Tenant's part to be observed and performed, Tenant may
peaceably and quietly enjoy the premises hereby demised, subject, nevertheless,
to the terms

                                     - 13 -

and conditions of this lease including, but not limited to, Article 31 hereof
and to the ground leases, underlying leases and mortgages hereinbefore
mentioned.

Failure to Give Possession:

         24. If Owner is unable to give possession of the demised premises on
the date of the commencement of the term hereof, because of the holding-over or
retention of possession of any tenant, undertenant or occupants or if the
demised premises are located in a building being constructed, because such
building has not been sufficiently completed to make the premises ready for
occupancy or because of the fact that a certificate of occupancy has not been
procured or for any other reason, Owner shall not be subject to any liability
for failure to give possession on said date and the validity of the lease shall
not be impaired under such circumstances, nor shall the same be construed in any
wise to extend the term of this lease, but the rent payable hereunder shall be
abated (provided Tenant is not responsible for Owner's inability to obtain
possession) until after Owner shall have given Tenant written notice that the
premises are substantially ready for Tenant's occupancy. If permission is given
to Tenant to enter into the possession of the demised premises or to occupy
premises other than the demised premises prior to the date specified as the
commencement of the term of this lease, Tenant covenants and agrees that such
occupancy shall be deemed to be under all the terms, covenants, conditions and
provisions of this lease, except as to the covenant to pay rent. The provisions
of this article are intended to constitute 'an express provision to the
contrary' within the meaning of Section 223-a of the New York Real Property Law.

No Waiver:

         25. The failure of Owner to seek redress for violation of, or to insist
upon the strict performance of any covenant or condition of this lease or of any
of the Rules or Regulations, set forth or hereafter adopted by Owner, shall not
prevent a subsequent act which would have originally constituted a violation
from having all the force and effect of an original violation. The receipt by
Owner of rent with knowledge of the breach of any covenant of this lease shall
not be deemed a waiver of such breach and no provision of this lease shall be
deemed to have been waived by Owner unless such waiver be in writing signed by
Owner. No payment by Tenant or receipt by Owner of a lesser amount than the
monthly rent herein stipulated shall be deemed to be other than on account of
the earliest stipulated rent, nor shall any endorsement or statement of any
check or any letter accompanying any check or payment as rent be deemed an
accord and satisfaction, and Owner may accept such check or payment without
prejudice to Owner's right to recover the balance of such rent or pursue any
other remedy in this lease provided. No act or thing done by Owner or Owner's
agents during the term hereby demised shall be deemed an acceptance of a
surrender of said premises, and no agreement to accept such surrender shall be
valid unless in writing signed by Owner. No employee of

                                     - 14 -

Owner or Owner's agent shall have any power to accept the keys of said premises
prior to the termination of the lease and the delivery of keys to any such agent
or employee shall not operate as a termination of the lease or a surrender of
the premises.

Waiver of Trial by Jury:

         26. It is mutually agreed by and between Owner and Tenant that the
respective parties hereto shall and they hereby do waive trial by jury in any
action, proceeding or counterclaim brought by either of the parties hereto
against the other (except for personal injury or property damage) on any matters
whatsoever arising out of or in any way connected with this lease, the
relationship of Owner and Tenant, Tenant's use of or occupancy of said premises,
and any emergency statutory or any other statutory remedy. It is further
mutually agreed that in the event Owner commences any summary proceeding for
possession of the premises, Tenant will not interpose any counterclaim of
whatever nature or description in any such proceeding including a counterclaim
under Article 4.

Inability to Perform:

         27. This Lease and the obligation of Tenant to pay rent hereunder and
perform all of the other covenants and agreements hereunder on part of Tenant to
be performed shall in no wise be affected, impaired or excused because Owner is
unable to fulfill any of its obligations under this lease or to supply or is
delayed in supplying any service expressly or impliedly to be supplied or is
unable to make, or is delayed in making any repair, additions, alterations or
decorations or is unable to supply or is delayed in supplying any equipment or
fixtures if Owner is prevented or delayed from so doing by reason of strike or
labor troubles or any cause whatsoever including, but not limited to, government
preemption in connection with a National Emergency or by reason of any rule,
order or regulation of any department or subdivision thereof of any government
agency or by reason of the conditions of supply and demand which have been or
are affected by war or other emergency.

Bills and Notices:

         28. Except as otherwise in this lease provided, a bill, statement,
notice or communication which Owner may desire or be required to give to Tenant,
shall be deemed sufficiently given or rendered if, in writing, delivered to
Tenant personally or sent by registered or certified mail addressed to Tenant at
the building of which the demised premises form a part or at the last known
residence address or business address of Tenant or left at any of the aforesaid
premises addressed to Tenant, and the time of the rendition of such bill or
statement and of the giving of such notice or communication shall be deemed to
be the time when the same is delivered to Tenant, mailed, or left at the
premises as herein provided. Any notice by Tenant to Owner

                                     - 15 -

must be served by registered or certified mail addressed to Owner at the address
first hereinabove given or at such other address as Owner shall designate by
written notice.

Services Provided by Owners:

         29. As long as Tenant is not in default under any of the covenants of
this lease, Owners shall provide: (a) necessary elevator facilities on business
days from 8 a.m. to 6 p.m. and have one elevator subject to call at all other
times; (b) heat to the demised premises when and as required by law, on business
days from 8 a.m. to 6 p.m.; (c) water for ordinary lavatory purposes, but if
Tenant uses or consumes water for any other purposes or in unusual quantities
(of which fact Owner shall be the sole judge), Owner may install a water meter
at Tenant's expense which Tenant shall thereafter maintain at Tenant's expense
in good working order and repair to register such water consumption and Tenant
shall pay for water consumed as shown on said meter as additional rent as and
when bills are rendered; (d) cleaning service for the demised premises on
business days at Owner's expense provided that the same are kept in order by
Tenant. If, however, said premises are to be kept clean by Tenant, it shall be
done at Tenant's sole expense, in a manner satisfactory to Owner and no one
other than persons approved by Owner shall be permitted to enter said premises
or the building of which they are a part for such purpose. Tenant shall pay
Owner the cost of removal of any of Tenant's refuse and rubbish from the
building; (e) If the demised premises is serviced by Owner's air
conditioning/cooling and ventilating system, air conditioning/cooling will be
furnished to tenant from May 15th through September 30th on business days
(Mondays through Fridays, holidays excepted) from 8:00 a.m. to 6:00 p.m., and
ventilation will be furnished on business days during the aforesaid hours except
when air conditioning/cooling is being furnished as aforesaid. If Tenant
requires air conditioning/cooling or ventilation for more extended hours or on
Saturdays, Sundays or on holidays, as defined under Owner's contract with
Operating Engineers Local 94-94A, Owner will furnish the same at Tenant's
expense. RIDER to be added in respect to rates and conditions for such
additional service; (f) Owner reserves the right to stop services of the
heating, elevators, plumbing, air-conditioning, power systems or cleaning or
other services, if any, when necessary by reason of accident or for repairs,
alterations, replacements or improvements necessary or desirable in the judgment
of Owner for as long as may be reasonably required by reason thereof. If the
building of which the demised premises are a part supplies manually-operated
elevator service. Owner at any time may substitute automatic-control elevator
service and upon ten days' written notice to Tenant, proceed with alterations
necessary therefor without in any wise affecting this lease or the obligation of
Tenant hereunder. The same shall be done with a minimum of inconvenience to
Tenant and Owner shall pursue the alteration with due diligence.

                                     - 16 -

Captions:

         30. The Captions are inserted only as a matter of convenience and for
reference and in no way define, limit or describe the scope of this lease nor
the intent of any provisions thereof.

Definitions:

         31. The term 'office', or 'offices', wherever used in this lease, shall
not be construed to mean premises used as a store or stores, for the sale or
display, at any time, of goods, wares or merchandise, of any kind, or as a
restaurant, shop, booth, bootblack or other stand, barber shop, or for other
similar purposes or for manufacturing. The term 'Owner' means a landlord or
lessor, and as used in this lease means only the owner, or the mortgagee in
possession, for the time being of the land and building (or the owner of a lease
of the building or of the land and building) of which the demised premises form
a part, so that in the event of any sale or sales of said land and building or
of said lease, or in the event of a lease of said building, or of the land and
building, the said Owner shall be and hereby is entirely freed and relieved of
all covenants and obligations of Owner 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, at any such sale, or the
said lessee of the building, or of the land and building, that the purchaser or
the lessee of the building has assumed and agreed to carry out any and all
covenants and obligations of Owner, hereunder. The words 're-enter' and
're-entry' as used in this lease are not restricted to their technical legal
meaning. The term 'business days' as used in this lease shall exclude Saturdays,
Sundays and all days observed by the State or Federal Government as legal
holidays and those other designated as holidays by the applicable building
service union employees service contract or by the applicable Operating
Engineers contract with respect to HVAC service.

Adjacent Excavation -- Shoring:

         32. If an excavation shall be made upon land adjacent to the demised
premises, or shall be authorized to be made, Tenant shall afford to the person
causing or authorized to cause such excavation, license to enter upon the
demised premises for the purpose of doing such work as said person shall deem
necessary to preserve the wall or the building of which demised premises form a
part from injury or damage and to support the same by proper foundations without
any claim for damages or indemnity against Owner, or diminution or abatement of
rent.

Rules and Regulations:

         33. Tenant and Tenant's servants, employees, agents, visitors, and
licensees shall observe faithfully, and comply strictly with, the Rules and
Regulations and such

                                     - 17 -

other and further reasonable Rules and Regulations as Owner or Owner's agents
may from time to time adopt. Notice of any additional rules or regulations shall
be given in such manner as Owner may elect. In case Tenant disputes the
reasonableness of any additional Rule or Regulation hereafter made or adopted by
Owner or Owner's agents, the parties hereto agree to submit the question of the
reasonableness of such Rule or Regulation for decision to the New York office of
the American Arbitration Association, whose determination shall be final and
conclusive upon the parties hereto. The right to dispute the reasonableness of
any additional Rule or Regulation upon Tenant's part shall be deemed waived
unless the same shall be asserted by service of a notice, in writing upon Owner
within ten (10) days after the giving of notice thereof. Nothing in this lease
contained shall be construed to impose upon Owner any duty or obligation to
enforce the Rules and Regulations or terms, covenants or conditions in any other
lease, as against any other tenant and Owner shall not be liable to Tenant for
violation of the same by any other tenant, its servants, employees, agents,
visitors or licensees.

Security:

         34. Tenant has deposited with Owner the sum of $27,712.30 as security
for the faithful performance and observance by Tenant of the terms, provisions
and conditions of this lease; it is agreed that in the event Tenant defaults in
respect of any of the terms, provisions and conditions of this lease, including,
but not limited to, the payment of rent and additional rent, Owner may use,
apply or retain the whole or any part of the security so deposited to the extent
required for the payment of any rent and additional rent or any other sum as to
which Tenant is in default or for any sum which Owner may expend or may be
required to expend by reason of Tenant's default in respect of any of the terms,
covenants and conditions of this lease, including but not limited to, any
damages or deficiency in the re-letting of the premises, whether such damages or
deficiency accrued before or after summary proceedings or other re-entry by
Owner. In the event that Tenant shall fully and faithfully comply with all of
the terms, provisions, covenants and conditions of this lease, the security
shall be returned to Tenant after the date fixed as the end of the Lease and
after delivery of entire possession of the demised premises to Owner. In the
event of a sale of the land and building or leasing of the building, of which
the demised premises form a part, Owner shall have the right to transfer the
security to the vendee or lessee and Owner shall thereupon be released by Tenant
from all liability for the return of such security; and Tenant agrees to look to
the new Owner solely for the return of said security, and it is agreed that the
provisions hereof shall apply to every transfer or assignment made of the
security to a new Owner. Tenant further covenants that it will not assign or
encumber or attempt to assign or encumber the monies deposited herein as
security and that neither Owner nor its successors or assigns shall be bound by
any such assignment, encumbrance, attempted assignment or attempted encumbrance.

                                     - 18 -

Estoppel Certificate:

         35.      (See Article 43)

Successors and Assigns:

         36. The covenants, conditions and agreements contained in this lease
shall bind and inure to the benefit of Owner and Tenant and their respective
heirs, distributees, executors, administrators, successors, and except as
otherwise provided in this lease, their assigns.

              SEE RIDER PAGES ANNEXED HERETO AND MADE A PART HEREOF
                           CONTAINING ARTICLES 37 - 56

         IN WITNESS WHEREOF, Owner and Tenant have respectively signed and
sealed this lease as of the day and year first above written.

                                             521 FIFTH AVENUE ASSOCIATES,

                                             Owner

                                             By: /s/ Larry A. Silverstein
                                                -------------------------------
                                                               General Partner

Witness for Owner:


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

Witness for Tenant:                          THE EDISON PROJECT, L.P., Tenant

                                             By: /s/ Christopher Whittle
------------------------                         -------------------------------
                                                      Name: Christopher Whittle
                                                      Title: General Partner


                                     - 19 -


                            FIRST AMENDMENT OF LEASE

     AGREEMENT, dated as of the 6th day of June, 1996, by and between 521 FIFTH
AVENUE ASSOCIATES ('LANDLORD'), a New York limited partnership, with its
principal place of business at 521 Fifth Avenue, New York, New York 10175, and
THE EDISON PROJECT, L.P. ('TENANT'), a New York limited partnership, having an
office at 521 Fifth Avenue, New York, New York 10175.

                               STATEMENT OF FACTS

     By Lease dated as of April 4, 1995 (the 'ORIGINAL LEASE'), by and between
Landlord and Tenant, Landlord leased to Tenant and Tenant hired from Landlord
certain premises in the building (the 'BUILDING') known as 521 Fifth Avenue, New
York, New York, consisting of a portion of the sixteenth (16th) floor (the
'ORIGINAL PREMISES').

     The Original Lease and any and all amendments and modifications thereof are
hereinafter collectively referred to as the 'LEASE'. Landlord and Tenant now
desire to amend the Lease upon the terms hereinafter contained.

     NOW, THEREFORE, in consideration of the Lease and the mutual covenants
herein contained, Landlord and Tenant hereby agree as follows:

          1. DEFINED TERMS:

             A. Unless the context otherwise clearly indicates a contrary intent
or unless specifically otherwise provided herein, each term used in this
Agreement which is defined in the Lease shall be deemed to have the meaning set
forth in the Lease.

          2. EXTENSION OF LEASE TERM:

             A. The term of the Lease is hereby extended for a period of five
(5) months, commencing on AUGUST 1, 1997 and expiring on DECEMBER 31, 1997 (the
'EXPIRATION DATE'), or shall expire on such earlier date upon which said term
may expire or be cancelled or terminated pursuant to any of the conditions or
covenants of the Lease as hereby amended or pursuant to law.

          3. ADDITIONAL PREMISES:

             A. For the purposes of this Agreement, the 'ADDITIONAL PREMISES'
shall mean that certain portion of the sixteenth (16th) floor of the Building as

indicated by cross-hatch markings on the floor plan annexed hereto as EXHIBIT A
and made a part hereof.

             B. Effective throughout the period (the 'ADDITIONAL PREMISES TERM')
commencing on JULY 1, 1996 (the 'ADDITIONAL PREMISES COMMENCEMENT DATE') and
ending on the Expiration Date, both dates inclusive:

                i. the Lease is hereby amended by adding the Additional
             Premises to the Demised Premises; and

                ii. Tenant shall use and occupy the Additional Premises under
             the same terms, covenants and conditions provided in the Lease,
             except as otherwise herein amended.

          4. FIXED RENT:

             A. Effective throughout the period commencing on the Additional
Premises Commencement Date and ending on the Expiration Date, both dates
inclusive, the fixed rent payable pursuant to the Lease shall, subject to
adjustment as provided in the Lease, be increased by the annual amount of
Fifty-Seven Thousand Two Hundred Sixty-Two and 45/100 ($57,262,.45) Dollars
($4,771.84 per month) (which increase shall herein be referred to as the 'FIXED
A/P RENT').

             B. Effective as of the Additional Premises Commencement Date and
provided Tenant is not then in default under the terms, covenants and conditions
of this Agreement and/or the Lease, Tenant is herewith granted a fixed rent
concession solely in connection with the Fixed A/P Rent payable as set forth in
Paragraph 4.A of this Agreement for the Additional Premises, solely for the two
(2) month period (the 'FREE FIXED A/P RENT PERIOD') commencing on the Additional
Premises Commencement Date and ending on the day next preceding the two (2)
month anniversary of the Additional Premises Commencement Date; provided,
however, Tenant shall nevertheless be obligated to pay to Landlord all
additional rents and other charges payable under the terms of this Agreement
(including electricity charges) during the Free Fixed A/P Rent Period, and
provided further that Tenant shall pay to Landlord all of the fixed rent with
respect to the Original Premises and all additional rents and other charges
payable under the Lease during the Free Fixed A/P Rent Period. Except for the
Fixed A/P Rent concession as herein provided, Tenant shall use and occupy the
Demised Premises pursuant to all of the other terms, covenants and conditions of
the Lease.


                                       2

          5. TENANT'S PROPORTIONATE SHARE:

             A. Effective as of the Additional Premises Commencement Date and
ending on the Expiration Date, Sections 39.A.4 and 40.A.2 of the Original Lease
shall be amended so as to increase the 'Tenant's Proportionate Share' by adding
the percentage '0.73%' thereto.

          6. ELECTRIC CURRENT:

             A. Effective as of the Additional Premises Commencement Date and
ending on the Expiration Date, the provisions of Article 46 of the Original
Lease (which is captioned 'Electric Current') shall be amended by the deletion
of the number '8,052' from Paragraph 46.B.2. and the insertion of the number
'10,825' in lieu thereof.

          7. LAYOUT AND FINISH:

             A. Any and all provisions of the Lease which provide for the
performance by Landlord of any work in the Original Premises (such as, by way of
example, the 'Tenant's Initial Work' pursuant to Article 50 of the Original
Lease) shall apply solely to the Original Premises and shall not apply to the
Additional Premises. Accordingly, Tenant acknowledges that Landlord shall have
no obligation to perform in the Additional Premises any of the Landlord's work
required in connection with the Original Premises, and there shall be no
contribution or allowance payable by Landlord with respect to all or any portion
of the Additional Premises.

          8. AS-IS POSSESSION/TENANT'S A/P WORK:

             A. Tenant acknowledges that it has fully inspected the Additional
Premises and Tenant agrees to accept possession thereof in its then 'as-is'
physical condition as of the Additional Premises Commencement Date. It is
understood and agreed that Landlord shall not be obligated to make any
improvements, alterations or repairs to the Additional Premises or incur any
expense to prepare the Additional Premises for Tenant's occupancy thereof. The
taking of possession of the Additional Premises by Tenant for the term herein
demised shall be conclusive evidence as against Tenant that the Additional
Premises and the Building were in good and satisfactory condition as of the time
such possession was taken. Tenant acknowledges that Landlord and Landlord's
agent have made no representations or promises in regard to the Additional
Premises for the term herein demised.

             B. Tenant shall, at Tenant's sole cost and expense, and as part of
Tenant's Changes (as defined in Article 42), perform all of the work (the
'TENANT'S A/P WORK') in the entire Additional Premises necessary to demise the
Additional Premises 


                                       3

such that the Demised Premises and the Additional Premises shall together
constitute a single, self-contained rental unit and for Tenant's occupancy
thereof, subject to the provisions of this Agreement and the Lease. Tenant
agrees with respect to its activities and work that it will conform to all of
Landlord's labor regulations and shall not do or permit anything to be done that
might create any work stoppage, picketing or other labor disruption or dispute.
Tenant agrees that it will, prior to the commencement of any work in the
Additional Premises, deliver to Landlord all policies of insurance required to
be supplied to Landlord by Tenant pursuant to the terms of the Lease.

              C. Tenant, at Tenant's sole cost and expense, shall prepare a
final plan or final set of plans (which said final plan or final set of plans,
as the case may be, is hereinafter called the 'A/P PLANS') which shall contain
complete information (including engineering required) and dimensions necessary
and sufficient for the construction and finishing of the Additional Premises.
The A/P Plans shall be submitted by Tenant to Landlord for Landlord's review and
approval on or before the date (the 'PLANS DELIVERY DATE') of the execution and
delivery of this Agreement by Tenant. Any revisions to the A/P Plans required by
Landlord shall be performed by Tenant within three (3) days after demand by
landlord.

              D. Tenant agrees to utilize Landlord's designated general
contractor for the performance of the Tenant's A/P Work. Tenant further agrees
that the Tenant's A/P Work shall be completed on or before the date which shall
be sixty (60) days after the Additional Premises Commencement Date.

          9.  DELIVERY OF POSSESSION:

              If Landlord is unable to give possession of the Additional
Premises to Tenant on the Additional Premises to Tenant on the Additional
Premises Commencement Date because of the holding-over or retention of
possession of any tenant, undertenant or occupants, or for any other reason
beyond Landlord's reasonable control, Landlord shall not be subject to any
liability for failure to give possession on said date and the validity of this
Agreement and the Lease shall not be impaired under such circumstances, nor
shall the same be construed in any way to extend the Additional Premises Term or
the term of the Lease, but the Additional Premises Commencement Date shall be
deemed extended until the date on which Landlord shall have delivered possession
thereof to Tenant (provided Tenant is not responsible for the inability to
obtain possession). The provisions of this Paragraph are intended to constitute
'an express provision to the contrary' within the meaning of Section 223-a of
the New York Real Property Law.

          10. SECURITY DEPOSIT:


                                       4

              A. In addition to the security previously deposited with Landlord
pursuant to the provisions of Article 34 of the Original Lease, concurrently
with Tenant's execution of this Agreement, Tenant shall deposit with Landlord
the sum of Nine Thousand Five Hundred Forty-Four and 00/100 ($9,544.00) Dollars,
as additional security for the full and punctual performance by Tenant of all of
the terms of the Lease (including this Agreement), by check (subject to
collection).

              B. Effective as of the Additional Premises Commencement Date,
Article 34 of the Original Lease (which is captioned 'Security') is hereby
amended by increasing the amount of the security deposit by adding the amount of
Nine Thousand Five Hundred Forty-Four and 00/100 ($9,544.00) Dollars thereto.

          11. BROKER:

              Tenant represents and warrants that it neither consulted nor
negotiated with any broker or finder with regard consummating this Agreement.
Tenant agrees to indemnify and hold Landlord harmless from any damages, costs
and expenses suffered by Landlord by reason of any breach of the foregoing
representation.

          12. MISCELLANEOUS:

              A. Except as expressly set forth in this Agreement, all of the
terms, provisions, covenants and conditions of the Lease shall remain and
continue unmodified and in full force and effect and are hereby ratified and
confirmed in all respects.

              B. This Agreement shall not be changed, modified or cancelled
orally. This Agreement shall be binding upon the parties hereto, their
respective heirs, administrators, successors and, as permitted, assigns.

              C. This Agreement shall in all respects and in all events be
governed by and construed in accordance with the laws of the State of New York
(excluding, however, its conflict of laws provisions).

              D. This Agreement is being tendered to Tenant without obligation
on Landlord's part and in no event shall it be deemed to be binding upon
Landlord or give Tenant any rights unless and until Landlord shall have executed
the same and delivered a copy to Tenant.


                                       5

              IN WITNESS WHEREOF, Landlord and Tenant have respectively executed
this First Amendment of Lease as of the day and year first above written.

                                  521 FIFTH AVENUE ASSOCIATES, Landlord


                                  By: /s/ Larry A. Silverstein
                                      -------------------------------------
                                      Larry A. Silverstein, General Partner


                                  THE EDISON PROJECT, L.P.,  Tenant


                                  By: /s/ H. Christopher Whittle
                                      -------------------------------------
                                      Name: H. Christopher Whittle
                                      Title:  General Partner

                                      Tenant's Federal Employer
                                      I.D. Number: 621 488 748


                                       6


                            SECOND AMENDMENT OF LEASE

         AGREEMENT, dated as of the 8th day of December, 1997, between 521 FIFTH
AVENUE ASSOCIATES, a New York limited partnership, having an office at 521 Fifth
Avenue, New York, New York 10175 (hereinafter called 'LANDLORD'), and THE EDISON
PROJECT, L.P., a New York limited partnership, having an office at 521 Fifth
Avenue, New York, New York 10175 (hereinafter called 'TENANT').

                              W I T N E S S E T H:

         WHEREAS:

         1. Landlord and Tenant executed that certain lease dated as of April 4,
1995 (said lease as amended by First Amendment of Lease dated as of June 6, 1996
(the 'FIRST AMENDMENT') is hereinafter called the 'ORIGINAL LEASE'), covering a
certain portion of the sixteenth (16th) floor, as more particularly described in
the Original Lease (hereinafter called the 'PRESENT PREMISES') , in the building
known as 521 Fifth Avenue, New York, New York (hereinafter called the
'BUILDING'), for a term expiring on December 31, 1997;

         2. The Original Lease and any and all amendments and modifications
thereof are hereinafter collectively referred to as the 'LEASE'; and

         3. The parties now desire to amend the Lease by extending the term
thereof, adding additional space to the Present Premises, and in other respects
as hereinafter provided.

         NOW, THEREFORE, in consideration of the mutual covenants herein
contained, it is agreed as follows:

         FIRST: The term of the Lease is hereby extended for a period of TEN
(10) YEARS (hereinafter called the 'EXTENDED TERM') commencing on January 1,
1998 (hereinafter called the 'EXTENDED TERM COMMENCEMENT DATE') and expiring on
December 31, 2007 (hereinafter called the 'EXTENDED TERM EXPIRATION DATE'),
unless sooner terminated pursuant to any of the terms, covenants and conditions
contained in the Lease or pursuant to law, upon all the terms, covenants and
conditions contained in the Lease, except as expressly provided herein.

         SECOND: The Lease is hereby amended, effective from the Additional
Premises Commencement Date (as defined in Article FIFTH of this Agreement), so
that the Present Premises shall include that portion of the fifteenth (15th)
floor of the Building as approximately shown by the diagonal markings on the
rental plan annexed hereto as Exhibit 'A' and made a part hereof (hereinafter
called the 'ADDITIONAL PREMISES'). Tenant shall use and occupy the Additional
Premises from and after the Additional Premises Commencement Date under the same
terms, covenants and conditions as provided in the Lease.