CHILDRENS PLACE RETAIL STORES INC
<DOCUMENT>
<TYPE>EX-10.2
<SEQUENCE>3
<FILENAME>v00927_x10-2.txt
<TEXT>
<PAGE>


                                  EXHIBIT 10.2

        LEASE AGREEMENT AS OF AUGUST 12, 2003 BETWEEN ORLANDO CORPORATION

         AND THE CHILDREN'S PLACE (CANADA), LP. TOGETHER WITH, INDEMNITY

         AGREEMENT AS OF AUGUST 12, 2003 BETWEEN THE COMPANY AND ORLANDO

      CORPORATION. TOGETHER WITH, SURRENDER OF LEASE AS OF AUGUST 12, 2003

      BETWEEN THE COMPANY AND ORLANDO CORPORATION AND ORION PROPERTIES LTD.


<PAGE>



                                    DATED:                 August 12, 2003
                                    --------------------------------------------


                                                    B E T W E E N:


                                                  ORLANDO CORPORATION

                                                       - and -


                                           THE CHILDREN'S PLACE (CANADA), LP



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

                                                         LEASE

                                                Regarding 6040 Cantay Road
                                                   Mississauga, Ontario

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



<PAGE>

                               ORLANDO CORPORATION

                                INDUSTRIAL LEASE

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>

                                                                                                                SECTION

                                               ARTICLE I - DEMISE AND TERM
<S>                                                                                                             <C>
Premises..................................................................................................        1.01
Term......................................................................................................        1.02
Early Access..............................................................................................        1.03
Options to Extend.........................................................................................        1.04
Acceptance of Premises....................................................................................        1.05
Quiet Enjoyment...........................................................................................        1.06



                                                    ARTICLE II - RENT

Intent of Lease...........................................................................................        2.01
Basic Rent................................................................................................        2.02
Calculation of Basic Rent.................................................................................        2.03
Additional Rent...........................................................................................        2.04
Deposit...................................................................................................        2.05
Payments to Landlord......................................................................................        2.06
Overdue Rent..............................................................................................        2.07
Set-Off...................................................................................................        2.08
Review of Tenant's Financial Statements...................................................................        2.09
Pre-Authorized Bank Debit.................................................................................        2.10



                                                   ARTICLE III - TAXES

Taxes Payable by Tenant...................................................................................        3.01
Payment of Taxes..........................................................................................        3.02
Appeal of Assessment .....................................................................................        3.03
Separate Assessment.......................................................................................        3.04


                                           ARTICLE IV - HEATING AND UTILITIES

Utility Charges...........................................................................................        4.01
Heating...................................................................................................        4.02
Service Contracts.........................................................................................        4.03



                                           ARTICLE V - MAINTENANCE AND REPAIR

Maintenance, Repairs and Replacements.....................................................................        5.01
View and Repair ..........................................................................................        5.02
Alterations...............................................................................................        5.03
Removal of Fixtures and Improvements......................................................................        5.04
Construction Liens........................................................................................        5.05
Landlord to Maintain and Repair...........................................................................        5.06
Repairs on Termination....................................................................................        5.07



                                          ARTICLE VI - ASSIGNING AND SUBLETTING

Assigning or Subletting...................................................................................        6.01
Change of Control.........................................................................................        6.02
Sublet of Part of Premises................................................................................        6.03
Excess Rent...............................................................................................        6.04
Mortgage of Leasehold.....................................................................................        6.05
Advertising Premises......................................................................................        6.06
Disposition by Landlord...................................................................................        6.07
</TABLE>



                                                          -ii-
<PAGE>

<TABLE>
<CAPTION>
                                                                                                                SECTION

                                                    ARTICLE VII - USE
<S>                                                                                                             <C>
Use of Leased Premises....................................................................................        7.01
Observance of Law.........................................................................................        7.02
Waste and Nuisance........................................................................................        7.03
Signs.....................................................................................................        7.04
Outside Storage...........................................................................................        7.05
Overloading Floors........................................................................................        7.06
Parking...................................................................................................        7.07


                                         ARTICLE VIII - INSURANCE AND INDEMNITY

Tenant's Insurance........................................................................................        8.01
Landlord's Insurance......................................................................................        8.02
Limit of Landlord's Liability.............................................................................        8.03
Limit of Tenant's Liability...............................................................................        8.04
Indemnity ................................................................................................        8.05



                                           ARTICLE IX - DAMAGE AND DESTRUCTION

Abatement of Rent.........................................................................................        9.01
Termination...............................................................................................        9.02



                                                   ARTICLE X - DEFAULT

Events of Default.........................................................................................       10.01
Right of Re-entry.........................................................................................       10.02
Reletting ................................................................................................       10.03
Distress..................................................................................................       10.04
Right of Landlord to Cure Defaults........................................................................       10.05
Remedies Not Exclusive....................................................................................       10.06
Non-Waiver ...............................................................................................       10.07
Recovery of Adjustments...................................................................................       10.08



                                      ARTICLE XI - SUBORDINATION AND ACKNOWLEDGEMENTS

Mortgages.................................................................................................       11.01
Certificates..............................................................................................       11.02



                                             ARTICLE XII - ACCESS BY LANDLORD

Entry by Landlord.........................................................................................       12.01
Exhibiting Leased Premises................................................................................       12.02
</TABLE>



                                                         -iii-
<PAGE>

<TABLE>
<CAPTION>

                                                                                                                SECTION

                                               ARTICLE XIII - MISCELLANEOUS
<S>                                                                                                             <C>
Notice....................................................................................................       13.01
Registration .............................................................................................       13.02
Planning Act .............................................................................................       13.03
Obligations as Covenant...................................................................................       13.04
Severability..............................................................................................       13.05
Overholding ..............................................................................................       13.06
Unavoidable Delays........................................................................................       13.07
Evidence of Payments......................................................................................       13.08
Lien .....................................................................................................       13.09
Time of Essence...........................................................................................       13.10
Law ......................................................................................................       13.11
Captions/Headings.........................................................................................       13.12
Joint And Several Liability...............................................................................       13.13
Tenant Partnership........................................................................................       13.14
Environmental Assessments.................................................................................       13.15
Environmental Matters.....................................................................................       13.16
Easements.................................................................................................       13.17
Entire Agreement .........................................................................................       13.18
Effect Of Lease...........................................................................................       13.19

</TABLE>


                                    SCHEDULES

SCHEDULE "A" - Description of Lands
SCHEDULE "A-1" - Site Plan
SCHEDULE "B" - Definitions
SCHEDULE "C" - Exterior Maintenance/Repair Work
SCHEDULE "D" - Landlord's Work



<PAGE>

         THIS INDENTURE dated the 12th day of August, 2003,


BETWEEN:

                               ORLANDO CORPORATION
                      (Hereinafter called the "LANDLORD"),

                               OF THE FIRST PART;


                                    -- and --

                        THE CHILDREN'S PLACE (CANADA), LP
               BY TCP INVESTMENT CANADA II CORP., GENERAL PARTNER
                       (Hereinafter called the "TENANT"),

                               OF THE SECOND PART;


                           ARTICLE I - DEMISE AND TERM

PREMISES

  1.01 WITNESSETH that in consideration  of the rents,  covenants and agreements
hereinafter  reserved  and  contained  on the  part of the  Tenant  to be  paid,
observed and  performed,  the Landlord does demise and lease unto the Tenant and
the Tenant leases from the Landlord, the Leased Premises.

TERM

  1.02 To have and to hold the  Leased  Premises  for and during the term of ten
(10) years commencing on the Commencement Date.

The  Commencement  Date shall be thirty  (30) days  following  the date that the
Landlord notifies the Tenant that the Landlord's Work as set out in Schedule "D"
of  this  Lease  is  substantially  complete,  as  certified  by the  Landlord's
Architect. The date of substantial completion is currently estimated to be on or
about March 1, 2004.

EARLY ACCESS

  1.03  Provided  that:  (i) the Tenant has delivered to the Landlord this Lease
duly  executed  in form  acceptable  to the  Landlord;  and (ii) the  Tenant has
delivered  to the Landlord the deposit as set out in Section 2.05 of this Lease,
the Tenant shall be entitled to have early access ("Early Access") to the Leased
Premises  for the period which is thirty (30) days  following  the date that the
Landlord notifies the Tenant that the Landlord's Work is substantially  complete
(the "Early Access  Period") in order for the Tenant to set up its  distribution
equipment and racking in the Leased  Premises.  Upon taking such Early Access of
all or any part of the Leased Premises, the Tenant shall observe and perform all
of the  Tenant's  covenants  and  obligations  set out in this Lease except that
Basic Rent and  Additional  Rent  shall not be payable by the Tenant  during the
Early Access Period.

OPTIONS TO EXTEND

  1.04 If the Tenant is not then in default under this Lease and has not been in
material default beyond  applicable notice and cure periods and further provided
that the Tenant has not been late in the payment of Rent  hereunder on more than
two occasions in any twelve consecutive month period, then the Tenant shall have
two (2) options to extend  this Lease for  further  terms of five (5) years each
upon the same terms and conditions contained in this Lease except:

         (a)      There  shall  be no  Landlord's  Work,  Early  Access,  cap on
                  Capital   Tax    (Section    3.01   (d),   cap   on   Exterior
                  Maintenance/Repair   Work   (Section   5.06  (a),  or  cap  on
                  Landlord's Insurance (Section 8.02);

         (b)      There shall be no further option to extend the Lease after the
                  second option to extend; and

         (c)      The Basic Rent payable by the Tenant during the first extended
                  term  shall be  calculated  at the  annual  rate of $7.84  per
                  square foot of the area of the  Building and during the second
                  extended  term shall be calculated at the annual rate of $9.40
                  per square foot of the area of the Building.

In order to exercise either  extension  option,  the Tenant shall be required to
give  unconditional  written notice to the Landlord not less than six (6) months
before the expiry of the initial Term of the Lease or the first  extended  term,
as the case may be, failing which, all then  unexercised  options to extend will
become null and void.



                                      -2-
<PAGE>


ACCEPTANCE OF PREMISES

  1.05 The Tenant shall examine the Leased  Premises  before  taking  possession
thereof and such taking of possession  shall be  conclusive  evidence as against
the Tenant that at the time thereof the Leased  Premises  were in good order and
satisfactory  condition and that all promises,  representations and undertakings
by or binding upon the Landlord  with respect to any  alteration,  remodeling or
decorating  of or  installation  of fixtures in the Leased  Premises,  have been
fully satisfied and performed by the Landlord.  The Tenant acknowledges that the
existing leasehold  improvements,  if any, are acceptable and that the Tenant is
taking possession of the Leased Premises as is, subject to the completion of the
Landlord's  Work  set  forth  in  Schedule  "D" of this  Lease.  Notwithstanding
anything contained herein to the contrary, the Landlord and Tenant shall inspect
the Leased  Premises at the time the Tenant is given  occupancy  thereof and the
parties shall jointly  prepare a so-called  punchlist of incomplete or defective
items in the Landlord's Work.  Thereafter,  the Landlord shall promptly complete
such incomplete  items and remedy such defective  items. The Landlord shall also
be responsible  for correcting  defects in the Landlord's Work not caused by the
Tenant and of which it is notified in writing within one (1) year after delivery
of the Leased  Premises to the Tenant.  The Landlord  shall  cooperate  with the
Tenant in pursuing all construction  guarantees  relating to the construction of
the Leased  Premises and the Landlord  shall assign to the Tenant the benefit of
those construction guarantees relating to the items which the Tenant is required
to repair and maintain pursuant to this Lease.

QUIET ENJOYMENT

  1.06 If the Tenant pays the Rent hereby reserved and observes and performs the
covenants  on its part  contained in this Lease,  then the Tenant may  peaceably
possess  and enjoy the  Leased  Premises  for the Term  hereby  granted  without
disturbance  from the Landlord or any other party lawfully  claiming by, from or
under the Landlord.

                                ARTICLE II - RENT

INTENT OF LEASE

  2.01 The Tenant  acknowledges  that it is  intended  and agreed that this is a
completely  carefree  net lease for the  Landlord  and that the  Landlord is not
responsible  during the Term or any renewal thereof for any taxes,  impositions,
costs, charges, expenses or outlays of any nature or kind relating to the Leased
Premises,  save only as specifically  set out in this Lease, and that the Tenant
shall  be  responsible  for and  shall  promptly  pay  all  such  taxes,  costs,
impositions, charges, expenses and outlays.

BASIC RENT

  2.02 Yielding and paying  therefor  yearly and every year during the Term unto
the Landlord as Basic Rent for the Leased Premises in lawful money of Canada:

         (a)      during the first five (5) years of the Term (the "First Rental
                  Period")  the  sum of  $531,873.73  per  annum  to be  paid in
                  advance,   in  equal  consecutive   monthly   installments  of
                  $44,322.81 on the first day of each and every month during the
                  First  Rental  Period  to the  Landlord,  the  first  of  such
                  payments to be made on the Commencement Date; and

         (b)      during the last five (5) years of the Term (the "Second Rental
                  Period")  the  sum of  $623,543.17  per  annum  to be  paid in
                  advance,   in  equal   consecutive   monthly   instalments  of
                  $51,961.93  on the first  day of each and  every  month of the
                  Second  Rental  Period  to the  Landlord,  the  first  of such
                  payments to be made on the  commencement  of the Second Rental
                  Period.

If the Term  commences  on any day other than the first or ends on any day other
than the last day of a month,  then Basic Rent for the  fractions  of a month at
the  commencement and at the end of the Term shall be adjusted pro rata on a per
diem basis.

CALCULATION OF BASIC RENT

2.03 The  Basic  Rent is  calculated  on the basis of the  Rentable  Area of the
Building  being 95,489 square feet  multiplied by: (a) $5.57 per square foot per
annum  during the First Rental  Period;  and (b) $6.53 per square foot per annum
during the Second Rental Period.  Prior to the  Commencement  Date, the Landlord
shall  cause  the  floor  area of the  Leased  Premises  to be  measured  by its
Architect. The certificate of the Landlord's Architect regarding the measurement
of the Rentable Area of the Leased Premises shall be conclusive and binding upon
the parties absent manifest error. If the floor area of the Leased Premises,  as
so measured,  is more or less than the number of square feet  attributed  to the
Leased  Premises  by the  provisions  of this Lease then the Basic Rent  payable
hereunder  based upon the actual  floor  area of the  Leased  Premises  shall be
adjusted  in  proportion  to the square  footage of the  Leased  Premises  as so
measured,  except that if the size of the Leased  Premises  exceeds  103% of the
square  footage set forth in this Lease.  Basic Rent shall be computed as if the
size of the Leased  Premises  contains  103% of the square  footage set forth in
this Lease. In the event the Architect's certificate indicates the Rentable Area
of the Leased Premises to be other than 95,489 square feet, the Basic Rent shall
be adjusted accordingly.



                                      -3-
<PAGE>


ADDITIONAL RENT

  2.04 The Tenant shall pay Additional Rent due and owing to the Landlord within
ten (10) days of written demand therefor or otherwise  hereinafter expressly set
out and all other Additional Rent on the due date thereof.

DEPOSIT

2.05 The Landlord  acknowledges receipt of $38,180.68 which shall be held by the
Landlord together with an existing deposit of $13,781.25 held under the existing
lease for 6291 Ordan Drive,  Mississauga,  Ontario dated the 21st day of August,
2000 (the "Existing  Lease").  If, prior to the Commencement  Date, the Landlord
reduces  such  security  under the terms of the  Existing  Lease then the Tenant
covenants  and  agrees  to pay to the  Landlord  forthwith  the  amount  of such
reduction  and the  amount of  $51,961.93  (excluding  GST) shall be held by the
Landlord as security for the full and faithful  performance by the Tenant of all
the  agreements,  terms,  covenants and conditions  herein set forth and applied
against  expenses or other costs or damages  incurred by the  Landlord and to be
payable as liquidated  damages and not as penalty,  upon forfeiture,  default or
early  termination,  without prejudice to any further claims by the Landlord for
damages and/or any remedy for recovery thereof. In the event the Tenant observes
and performs the terms and conditions on its part under this Lease,  such monies
shall be applied without interest on account of Basic Rent for the last month of
the Term.

PAYMENTS TO LANDLORD

  2.06 All  payments to be made by the Tenant to the  Landlord  under this Lease
shall be made at the address  hereinafter  designated or, at such other place or
places  as the  Landlord  may  designate  in  writing,  or to such  agent of the
Landlord as the Landlord may from time to time direct.

OVERDUE RENT

  2.07 The Tenant shall pay the  Landlord  interest on all overdue Rent not paid
on the day appointed for payment thereof or within any applicable  notice period
pursuant  to Section  10.01(a) of this Lease,  if any,  all such  interest to be
calculated  from the date upon which the amount is first due  hereunder  or from
the expiry of any  applicable  notice  period,  if the Tenant is  entitled  to a
notice period pursuant to Section 10.01(a),  until actual payment thereof and at
a rate being the lesser of three percent (3%) per annum in excess of the minimum
lending rate charged to prime  commercial  borrowers by the Landlord's bank from
time to time or the rate permitted by law (the "Lease Interest Rate").  However,
in the event the Tenant is late in the  payment of Rent two or more times in any
twelve (12)  consecutive  month  period  then the  foregoing  interest  shall be
calculated at the  aforementioned  rate on all overdue Rent  calculated from the
date upon which such amount is first due hereunder until actual payment thereof.

SET-OFF

  2.08 All Rent payable by the Tenant to the Landlord  shall be paid without any
deduction,  set-off or  abatement  whatsoever  except as  expressly  hereinafter
provided.

REVIEW OF TENANT'S FINANCIAL STATEMENTS

  2.09 If the Tenant is late in the payment of any Rent (or any part thereof) in
any two (2) consecutive  months or more than twice in any twenty-four (24) month
period,  then the Tenant shall, at its own cost and expense,  forthwith  provide
the Landlord upon demand with audited current financial statements to the extent
they are not publicly  available so as to  adequately  enable it to determine to
its satisfaction the financial status of the Tenant.

PRE-AUTHORIZED BANK DEBIT

  2.10      (INTENTIONALLY DELETED)


                               ARTICLE III - TAXES

TAXES PAYABLE BY TENANT

3.01     The Tenant shall pay:

         (a)      the  Taxes  charged  on the  Leased  Premises,  as  determined
                  pursuant to Section 3.02 or Section  3.04, as the case may be,
                  which the  Landlord  estimates  to be $1.63 per square foot of
                  Rentable  Area of the Leased  Premises  per annum in the first
                  Year  of the  Term  (based  on  2002  tax  rates  for  similar
                  buildings);

         (b)      all taxes, rates,  duties,  assessments and other charges that
                  are levied,  rated,  charged or assessed against or in respect
                  of all improvements, equipment and facilities and goods of the
                  Tenant on or in the Leased Premises or any part thereof;



                                      -4-
<PAGE>


         (c)      every tax and license fee which is levied,  rated,  charged or
                  assessed against or in respect of every business carried on in
                  the Leased  Premises  or in  respect  of the use or  occupancy
                  thereof or any part of the Lands or the Building by the Tenant
                  and every  subtenant  or licensee of the Tenant or against the
                  Landlord on account of its  interest  in the Leased  Premises,
                  and  whether  in any  case,  any such  taxes,  rates,  duties,
                  assessments or license fees are rated,  charged or assessed by
                  any  federal,  provincial,  municipal,  school  or other  body
                  during the Term;

         (d)      Capital Tax  (provided  that  Capital Tax shall not exceed the
                  rate of $0.10 per square foot of  Rentable  Area of the Leased
                  Premises during the first Year of the Term); and

         (e)      the full  amount  of any  taxes in the  nature  of a  business
                  transfer  tax,  value  added  tax,  sales tax or any other tax
                  levied,  rated,  charged  or  assessed  in respect of the Rent
                  payable  by the  Tenant  under this Lease or in respect of the
                  rental of space under this Lease,  whether  characterized as a
                  goods and services tax, sales tax,  value added tax,  business
                  transfer tax or otherwise.

PAYMENT OF TAXES

  3.02   (a)      Subject to Section  3.04 of this Lease,  the Tenant  shall pay
                  the Taxes payable pursuant to paragraph (a) of Section 3.01 to
                  the  lawful  taxing  authority  when due or,  if  directed  in
                  writing by the  Landlord,  the Tenant  shall pay said Taxes to
                  the Landlord within ten (10) days' written demand therefor, or
                  the  Landlord  shall be  entitled  at any time or times in any
                  Year,  upon at least fifteen (15) days' written  notice to the
                  Tenant to require the Tenant to pay to the Landlord said Taxes
                  for such  Year in equal  monthly  installments.  Such  monthly
                  amount shall be determined by dividing the Taxes by the number
                  of months for the period from  January 1st in each Year of the
                  Term until the due date of the final  installment  of Taxes as
                  established  by the applicable  taxing  authority from time to
                  time in each Year ("Installment  Period") and shall be paid by
                  the Tenant to the Landlord, monthly as Additional Rent, on the
                  date  of  payment  of  monthly  rental   payments  during  the
                  Installment  Period.  The Landlord  shall be entitled not more
                  than two (2) times  during  such Year,  upon at least  fifteen
                  (15) days' written notice to the Tenant,  to reasonably revise
                  its  estimate  of the amount of increase of such Taxes and the
                  said monthly  installment  shall be revised  accordingly.  All
                  amounts  received  under this provision in any Year on account
                  of the  estimated  amount of such  Taxes  shall be  applied in
                  reduction of the actual amount of such Taxes for such Year. If
                  the amount received is less than the actual Taxes,  the Tenant
                  shall pay any  deficiency to the Landlord as  Additional  Rent
                  within  fifteen (15) days  following  receipt by the Tenant of
                  notice  of the  amount  of  such  deficiency.  If  the  amount
                  received is greater than the actual Taxes,  the Landlord shall
                  either  refund the  excess to the  Tenant as soon as  possible
                  after the end of the Year in respect  of which  such  payments
                  were made or,  at the  Landlord's  option,  shall  apply  such
                  excess  against  any  amounts  owing  or  becoming  due to the
                  Landlord by the Tenant. If the Tenant pays Taxes to the lawful
                  taxing  authority,  then  the  Tenant  shall  deliver  to  the
                  Landlord within fifteen (15) days after the date on which such
                  Taxes  are  payable  and  due,  official  receipts  evidencing
                  payment of same;

         (b)      Taxes payable  pursuant to paragraphs  (b) and (c) of Sections
                  3.01  shall  be  paid  by  the  Tenant  to the  lawful  taxing
                  authority when due;

         (c)      Taxes payable  pursuant to paragraphs  (d) and (e) of Sections
                  3.01  shall be paid to the  Landlord  within  ten  (10)  days'
                  written  demand  therefor  or at  such  time or  times  as the
                  Landlord from time to time  determines by notice in writing to
                  the Tenant.

APPEAL OF ASSESSMENT

  3.03 The Tenant shall not contest the amount or legality of the Taxes referred
to in this Section or make application for the reduction of such Taxes or of any
assessment  upon which such Taxes are based without the prior written consent of
the Landlord,  which consent shall not be unreasonably  withheld or delayed. The
Tenant shall diligently prosecute any contest of Taxes for which it has received
the  Landlord's  written  consent.  During such  proceedings to contest any such
Taxes, the Tenant shall pay to the Landlord or the taxing authority, as the case
may be,  all  Taxes in  accordance  with the  terms of this  Lease  pending  the
determination of such contest. The Tenant shall immediately on the determination
of such contest pay to the appropriate  taxing  authorities or the Landlord,  as
the case may be, such additional amount as may be required to satisfy such Taxes
in full.



                                      -5-
<PAGE>


SEPARATE ASSESSMENT

  3.04   (a)      If there is no separate assessment for Taxes  with  respect to
                  the Leased Premises, or if there is a separate assessment, but
                  such separate  assessment,  together  with all other  separate
                  assessments  relating  to the Leased  Premises  and such other
                  lands  and/or  buildings  included  in  such  assessment  roll
                  ("Complex"),  do not  aggregate the total  assessment  for the
                  Taxes  for the  Complex,  then  until  such time as there is a
                  separate  assessment  for Taxes  with  respect  to the  Leased
                  Premises   which,   together  with  all  other  such  separate
                  assessments,  aggregate the total assessment for Taxes for the
                  Complex,  and the Landlord has issued a direction to pay Taxes
                  pursuant to  paragraph  (b) of this Section  3.04,  the Tenant
                  shall pay to the Landlord in accordance  with Section 3.02 (a)
                  as Additional  Rent its  Proportionate  Share of the Taxes for
                  the Complex,  adjusting the occupied tax rate for the Tenant's
                  specific  use  of  the  Leased  Premises,  provided  that  the
                  Landlord,  at its option,  may apportion the total  assessment
                  for Taxes for the Complex  amongst the  leaseable  premises of
                  the Complex, including the Leased Premises, based on generally
                  accepted  real  estate  appraisal  practices.  If  there is no
                  separate  assessment  for  Taxes as  herein  provided  and the
                  Complex is not fully  assessed as a commercial  or  industrial
                  property  for  determination  of Taxes in any  Year,  then the
                  Landlord  shall  adjust the Taxes to an amount that would have
                  been  determined  if the  Complex  were fully  assessed  as an
                  occupied  commercial  or  industrial  property.  If the Leased
                  Premises  are at any time  during  the Term  assessed  for the
                  support of Separate  Schools or if the Taxes are  increased by
                  reason of any installations made in or upon or any alterations
                  made in or to the  Leased  Premises  by the  Tenant  or by the
                  Landlord  on behalf of the  Tenant,  the Tenant  shall pay the
                  amount of such increase forthwith to the Landlord upon receipt
                  of notice thereof.  For the purpose of this  subparagraph 3.04
                  (a),  "Proportionate  Share" means that fraction having as its
                  numerator   the  area  of  the  Building  and  having  as  its
                  denominator the Rentable Area of all Buildings in the Complex.

         (b)      If there is a separate  assessment  for Taxes with  respect to
                  the  Leased  Premises,  (which  separate  assessment  shall be
                  deemed to include  the  valuation  of the Leased  Premises  as
                  determined,  from time to time,  by the  assessor  for  realty
                  taxation  purposes  of  the  Complex,  as  evidenced  by  such
                  documentation (including,  without limitation,  the assessor's
                  valuation  and/or working papers) that may be available to the
                  Landlord,  from time to time) and if such separate  assessment
                  together with all other separate  assessments  for the Complex
                  aggregate the total assessment for Taxes for the Complex,  and
                  if the Landlord so directs the Tenant shall pay as  Additional
                  Rent the amount  calculated by multiplying  the assessment for
                  the Leased  Premises by the applicable tax rate  pertaining to
                  the Tenant's use of the Leased  Premises on an occupied basis,
                  which amount shall,  for the purposes of this Article III only
                  and  notwithstanding  anything else herein  contained,  be the
                  Tenant's "Proportionate Share" of Taxes for the Complex.


                       ARTICLE IV - HEATING AND UTILITIES

UTILITY CHARGES

  4.01 The Tenant  shall pay to the  suppliers  thereof  on the due  dates,  all
charges  for  electric  current and all other  utilities  supplied to or used in
connection  with the Leased  Premises.  In no event shall the Landlord be liable
for any injury to the Tenant,  its  servants,  gents,  employees,  customers  or
invitees  or to any  property  of the  Tenant  or to any  property  of any other
person,  firm or  corporation  on or about  the  Leased  Premises  caused  by an
interruption  or  failure  in the  supply of any such  utilities  to the  Leased
Premises.

HEATING

  4.02 The Tenant shall  maintain the  temperature  in the Leased  Premises at a
reasonable level to avoid damage occurring in or to the Leased Premises.

SERVICE CONTRACTS

  4.03 The Tenant covenants and agrees to take out a standard servicing contract
with a capable and  reputable  company for the  service and  maintenance  of the
heating  units and furnaces and air  conditioning  equipment  serving the Leased
Premises,  such  contract  to include the monthly  cleaning  of  exchangers  and
replacement  of  filters,  and to keep  such  contract  in force at its own cost
throughout  the Term and any renewal  thereof.  The Tenant agrees to provide the
Landlord with a copy of such servicing contract.



                                      -6-
<PAGE>


                       ARTICLE V - MAINTENANCE AND REPAIR

MAINTENANCE, REPAIRS AND REPLACEMENTS

  5.01 Subject  only to Section  5.05  hereof,  the Tenant shall at its own cost
repair,  replace,  maintain and keep the Leased Premises and every part thereof,
including  without  limitation  the  Leasehold  Improvements  and  the  heating,
ventilating and air conditioning  equipment  serving the Building,  fixtures and
furnishings  (whether or not installed or furnished by the Tenant),  in good and
substantial repair and condition as a prudent owner would do, damage by fire and
any other  perils  against  which the  Landlord is required  under this Lease to
insure excepted. The Tenant shall also keep the driveways, walkways, and parking
areas  free  and  clear of snow and ice  that  the  Tenant  (including,  without
limitation,  the  portion of the mutual  driveway  lying  between the Lands that
serve the Leased  Premises and the adjacent  building).  The Tenant  agrees that
upon  not  less  than  twenty-four  (24)  hours  notice  (except  in the case of
emergency  when no notice shall be required) the Landlord may enter and view the
state of repair and  condition  and that the Tenant shall  repair in  accordance
with notice in writing  from the  Landlord;  provided  always that if the Tenant
shall not  within  fifteen  (15)  days' of such  notice,  commence  and  proceed
diligently with the execution of the repairs and works mentioned in such notice,
it shall be lawful  for the  Landlord  to enter  upon the  Leased  Premises  and
execute  such  repairs and works at the  expense of the  Tenant,  and in any and
every such case the Tenant  covenants  with the  Landlord to pay to the Landlord
forthwith as  Additional  Rent all sums which the Landlord may have  expended in
doing such maintenance and making such repairs and/or replacements together with
fifteen  percent  (15%)  of such  costs as a  management  and  supervisory  fee;
provided  further that the doing of such  maintenance  or the making of any such
repairs or  replacements  by the Landlord  shall not relieve the Tenant from its
obligation to maintain, repair and replace.

VIEW AND REPAIR

  5.02      (INTENTIONALLY DELETED)


ALTERATIONS

   5.03 The  Tenant  shall  not,  without  the  prior  written  approval  of the
Landlord, make any installations, alterations, additions, partitions, repairs or
improvements in or to the Leased Premises,  including, without limitation, doing
anything  which might affect the structural  portions of the Leased  Premises or
the electrical,  lighting, heating,  ventilating,  air-conditioning,  sprinkler,
fire  protection,  roofing or other systems  therein.  The Tenant's  request for
approval shall be in writing and  accompanied by an adequate  description of the
contemplated work, the final working drawings and specifications  therefor;  the
Landlord's  costs of having its  architects,  engineers  or others  examine such
drawings  and  specifications  shall be  payable by the  Tenant  upon  demand as
Additional  Rent;  the Landlord may require that any or all such work be done by
the Landlord's  contractors  or workmen or by contractors or workmen  engaged by
the Tenant but first approved by the Landlord. All such work shall be subject to
inspection  by and the  reasonable  supervision  of the  Landlord  and  shall be
performed in accordance with all Applicable  Laws and any reasonable  conditions
(including but not limited to a reasonable supervision fee of the Landlord to be
paid by the  Tenant)  and  regulations  imposed  by the  Landlord,  and shall be
completed  in a good and  workmanlike  manner and with  reasonable  diligence in
accordance  with  the  approvals  given  by the  Landlord.  Any  connections  of
apparatus  to  the  base   electrical,   plumbing,   heating,   ventilating   or
air-conditioning  systems shall be deemed to be an alteration within the meaning
of this Section.  The Tenant shall,  at its own cost and before  commencement of
any work, obtain all necessary building or other permits and keep same in force.
Once consent of the Landlord has been obtained in connection with any such work,
the  Tenant  shall  not  make  any  modifications  thereto  (including,  without
limitation  changes  required in order to obtain a building  permit)  unless and
until it has submitted  revised drawings and  specifications to the Landlord and
obtained the Landlord's  further written approval of the proposed  changes.  The
Tenant shall not apply for any applicable permits or approvals unless the Tenant
provides to the  Landlord a copy of the approval or permit  application,  as the
case may be,  together with all supporting  documentation  or drawings  attached
thereto  and  obtains  the  Landlord's  authorization  in writing to submit such
application to the relevant authority.  Notwithstanding anything to the contrary
set forth in this Section 5.03, the Tenant may,  without the Landlord's  consent
but with prior notice to the Landlord,  make  alterations to the interior of the
Leased  Premises  which do not alter,  modify or in any other manner  whatsoever
affect  the  structural  portions  of the  Leased  Premises  or the  roof of the
Building and the exterior of the Leased Premises or the structural  integrity of
the Building of which the Leased  Premises  shall form a part,  or the plumbing,
electrical,  heating,  ventilating,  air-conditioning,  or mechanical systems or
installations in the Leased Premises,  provided that any such single  alteration
does not involve a cost in excess of $50,000.00  and does not require a building
permit.

REMOVAL OF FIXTURES AND IMPROVEMENTS

  5.04  Leasehold  Improvements  shall  immediately  become the  property of the
Landlord upon affixation or installation  without  compensation  therefor to the
Tenant but the  Landlord is under no  obligation  to repair,  maintain or insure
Leasehold  Improvements.  Leasehold  Improvements  shall not be removed from the
Leased Premises either during or at the expiration or earlier termination of the
Term, except that the Tenant shall, at the end of the Term remove such Leasehold
Improvements  installed  or  constructed  by or on behalf  of the  Tenant as the
Landlord may require to be removed and restore the Leased Premises provided that
the Tenant shall not be required to remove any Leasehold  Improvements  or other
alterations  made to the Leased  Premises after the completion of the Landlord's
Work which the  Landlord  and in respect of which the  Landlord,  at the time of
giving its approval, has exempted from this removal and restoration requirement.
The Tenant may,  during the Term,  remove its trade fixtures  provided that such
trade  fixtures are  immediately  replaced by trade  fixtures of equal or better
value.  The Tenant shall at the  expiration or earlier  termination  of the Term
remove its trade  fixtures.  Any removal of  Leasehold  Improvements  and/or the
Tenant's  trade fixtures shall be done at the Tenant's sole cost and expense and
the  Tenant  shall  forthwith  repair at its own cost any  damage  caused to the
Leased Premises or any part thereof by the  installation or removal of Leasehold
Improvements  and/or  trade  fixtures.  If the Tenant  does not remove its trade
fixtures at the expiration or earlier  termination  of the Term,  then the trade
fixtures  shall,  at the  option of the  Landlord,  become the  property  of the
Landlord  and may be removed from the Leased  Premises  and/or sold or otherwise
disposed of by the  Landlord in such manner as it deems  advisable.  For greater
certainty,   the  Tenant's   trade  fixtures  shall  not  include  any  heating,
ventilating or  air-conditioning  equipment or other building  services or floor
covering  affixed to the floor of the Leased  Premises.  The  obligations of the
Tenant set forth in this Section shall  survive the expiry or other  termination
of the Term.



                                      -7-
<PAGE>


CONSTRUCTION LIENS

5.05 The Tenant  covenants to pay promptly all its  contractors and material men
and do any and all  things  necessary  to  minimize  the  possibility  of a lien
attaching  to the Leased  Premises  or to any part of the  Building or the Lands
and, should any such lien be made or filed,  the Tenant shall take the necessary
steps  (including  posting  security  with the  appropriate  court if necessary)
discharge the same forthwith (after notice thereof is given to the Tenant),  but
in any event not later than ten (10) days after notice, at the Tenant's expense.
In the event the Tenant  shall fail to cause any such lien to be  discharged  as
aforesaid,  then, in addition to any other right or remedy of the Landlord,  the
Landlord may, but it shall not be so  obligated,  vacate from title or discharge
same by paying into Court the amount  necessary  to vacate the lien or by paying
directly to any such lien  claimant  the amount of the claim,  and the amount so
paid by the  Landlord and all costs and  expenses  including  but not limited to
solicitor's  fees (on a solicitor and client basis),  incurred for the discharge
of  such  lien  shall  be due and  payable  by the  Tenant  to the  Landlord  as
Additional  Rent on demand.  In the event that any lien  claimant  in respect of
work performed on behalf of the Tenant commences an action in which the Landlord
is named as a party  defendant and service of the statement of claim is effected
upon the Landlord,  the Tenant shall indemnify the Landlord for all of its legal
costs.

LANDLORD TO MAINTAIN AND REPAIR

  5.06   (a)      The Landlord  shall  perform at the Tenant's cost and expense,
                  the  maintenance and repair work listed in Schedule "C" hereto
                  (the "Exterior  Maintenance/Repair  Work").  The Tenant shall,
                  forthwith  upon  demand,  pay to the  Landlord  the  costs and
                  expenses  incurred  by the  Landlord  from  time  to  time  in
                  connection with the Exterior  Maintenance/Repair  Work, plus a
                  management  fee of  fifteen  percent  (15%) of such  costs and
                  expenses;  provided that such cost,  including the  management
                  fee,  shall not exceed  the rate of $0.25 per  square  foot of
                  Rentable Area of the Leased Premises for the first Year of the
                  Term.

         (b)      The Tenant  shall  perform the snow removal work on the Leased
                  Premises at its sole cost and expense and as such the Exterior
                  Maintenance/Repair  Work shall not include any  requirement on
                  the part of the Landlord to perform such snow removal work.

         (c)      The Landlord shall repair and/or replace, if necessary, at its
                  own  expense,  the  footings,   foundations,   bearing  walls,
                  structural  steel  and  metal  roof  deck  (excluding  without
                  limitation  the roof  membrane)  of the  Building  unless such
                  repairs  or  replacements  are  caused  by or  arise  from the
                  negligent  or willful  acts or  omissions  of the Tenant,  its
                  officers,  employees, agents, contractors or those for whom in
                  law the Tenant is responsible,  in which case the Tenant shall
                  bear the cost of such repairs and/or replacement together with
                  the Landlord's management fee of fifteen percent (15%) of such
                  costs and expenses.

REPAIRS ON TERMINATION

5.07     At the  expiration or sooner  termination of the Term the Tenant shall,
         at its own expense:

         (a)      deliver up possession  of the Leased  Premises to the Landlord
                  together with all Leasehold  Improvements  which the Tenant is
                  required or permitted to leave  therein or thereon in the same
                  condition in which the Tenant is required  under this Lease to
                  repair and maintain the Leased Premises, free and clear of all
                  encumbrances and in a clean and tidy condition and free of all
                  rubbish and to deliver to the  Landlord  all keys and security
                  devices;

         (b)      remove from the Leased  Premises,  at the option of and to the
                  satisfaction  of the  Landlord,  all  machine  bases,  cabling
                  (electrical  or  otherwise),   piping  (pneumatic,   water  or
                  otherwise)  and wiring  (electrical,  computer  or  otherwise)
                  installed by or on behalf of the Tenant;

         (c)      remove  any and  all  materials  which  may be  deemed  by any
                  applicable legislation as contaminated or hazardous (and which
                  have been brought onto the Leased  Premises by or on behalf of
                  the  Tenant  or which  are a  result  of the  Tenant's  use or
                  occupation of the Leased  Premises),  and clean up any and all
                  resultant contamination in compliance with all Applicable Laws
                  and regulations; and

         (d)      remove from the Leased Premises at the option of the Landlord,
                  in compliance  with all Applicable Laws and  regulations,  any
                  and all storage  and/or  holding tanks (whether above or below
                  ground)  installed  by or on behalf of the Tenant and all pits
                  and trenches created by or on behalf of the Tenant.

The  covenants  contained  in this  Section  shall  survive  the expiry or other
termination  of the Term and if the Tenant  should  breach any of the  foregoing
provisions  of this Section then,  without  prejudice to or limitation of any of
the rights or remedies of the  Landlord  hereunder  or at law and in addition to
paying any costs or expenses  incurred by the  Landlord,  plus  fifteen  percent
(15%) of such amounts,  the Tenant shall  continue to pay Rent for so long as it
may reasonably  take to complete with diligence the required  repairs,  removal,
restoration  or clean-up at the rate  applicable for the  immediately  preceding
rental period.


                                      -8-
<PAGE>


                      ARTICLE VI - ASSIGNING AND SUBLETTING

ASSIGNING OR SUBLETTING

  6.01   (a)      The Tenant shall not assign this Lease or sublet or franchise,
                  license, grant concessions in, or otherwise part with or share
                  possession of the Leased Premises, or any part thereof,  (each
                  of the  foregoing  hereinafter  referred  to as a  "Transfer")
                  without the prior written consent of the Landlord; at the time
                  the Tenant  requests  such consent the Tenant shall deliver to
                  the  Landlord  such  information  in  writing  (the  "required
                  information")   as  the  Landlord  may   reasonably   require,
                  including, without limitation, a copy of the proposed offer or
                  agreement,  if any,  to  Transfer  and the name,  address  and
                  nature of business and evidence as to the  financial  strength
                  of the  proposed  assignee or  subtenant or other user (any of
                  the foregoing hereinafter referred to as a "Transferee"); upon
                  receipt of such  request  and all  required  information,  the
                  Landlord  shall have the right,  exercisable  within  fourteen
                  (14) days after such receipt,  to terminate  this Lease if the
                  request  relates  to all of the  Leased  Premises  or,  if the
                  request  relates to a portion of the Leased Premises only, the
                  Landlord  shall  have the right to  terminate  this Lease with
                  respect  to such  portion  and the Rent  payable by the Tenant
                  under this Lease shall abate in the  proportion  that the area
                  of the portion of the Leased  Premises for which this Lease is
                  terminated   bears  to  the  area  of  the  Leased   Premises.
                  Notwithstanding  the foregoing,  if the Landlord exercises its
                  right to  terminate  this  Lease,  in  whole  or in  part,  as
                  aforesaid,  the  Tenant  shall  have the right to  revoke  the
                  Transfer request and nullify the Landlord's  termination right
                  upon notice give to the Landlord within ten (10) business days
                  following the exercise of the Landlord's termination right. If
                  the  Landlord  exercises  such right and the  Tenant  does not
                  revoke  the  Transfer  request,  the  Tenant  shall  surrender
                  possession of the Leased Premises or such portion thereof,  as
                  the case may be,  not less than  sixty  (60) days and not more
                  than  ninety  (90) days  following  the  Landlord's  notice of
                  exercise of its right  hereunder  in  accordance  with all the
                  provisions  of this Lease  relating  to the  surrender  of the
                  Leased Premises at the expiration of the Term and all Rent and
                  other charges shall be deemed to be adjusted  accordingly  and
                  the Lease shall be deemed to be amended accordingly, as of the
                  date of actual  surrender.  If the Landlord  does not exercise
                  such right,  then the Landlord's  prior written  consent shall
                  not be unreasonably withheld or delayed.

                  Notwithstanding  anything else herein  contained,  in no event
                  shall any Transfer of this Lease release or relieve the Tenant
                  in any  regard  whatsoever  from  any of  its  obligations  or
                  liabilities  under or in respect of this Lease  including  any
                  renewal or extension thereof.

                  PROVIDED  however,  and it is made a condition to any Transfer
requiring the Landlord's consent that:

                  (i)      The proposed  Transferee of this Lease shall agree in
                           writing  with the  Landlord to assume and perform all
                           of the terms, covenants, conditions and agreements by
                           this Lease  imposed upon the Tenant  herein in a form
                           to be reasonably approved by the Landlord (which form
                           shall  also be  executed  by the  Tenant)  and  shall
                           obtain any required occupancy approval from the local
                           building and fire  departments  and provide  evidence
                           thereof to the Landlord prior to taking  occupancy of
                           the Leased Premises;

                  (ii)     Except in the case of an  assignment  of this  Lease,
                           the  Transferee  shall also waive any rights which it
                           may have at common  law in  respect  of  relief  from
                           forfeiture  and any  rights it may have  pursuant  to
                           Sections  21 and 39 (2) of the  Commercial  Tenancies
                           Act (Ontario), as amended from time to time;

                  (iii)    The  Tenant  shall pay the  Landlord  all  reasonable
                           legal fees in connection with the Transfer;

                  (iv)     The  consent of the  Landlord  is not a waiver of the
                           requirement of the Landlord's  consent for subsequent
                           Transfers;

                  (v)      The  acceptance  by  the  Landlord  of  Rent  from  a
                           Transferee  without the Landlord's  consent shall not
                           constitute  a  waiver  of  the  requirement  of  such
                           consent nor shall it constitute an acceptance of such
                           party as the Tenant;

                  (vi)     The  Landlord  may,  at its  option,  cancel  (i) any
                           options  to  renew  the  Lease  or  extend  the  Term
                           provided  that in the case of an  assignment  of this
                           Lease consented to by the Landlord,  the Landlord may
                           not cancel  such  option;  and/or  (ii) any rights of
                           first  refusal  or first  opportunity  on  additional
                           space;

                  (vii)    The  Leased  Premises,  at the time of the  Transfer,
                           shall  comply in all  respects  with the  standard of
                           repair  and   maintenance   required  of  the  Tenant
                           pursuant to this Lease and the Lease shall  otherwise
                           be in good standing;



<PAGE>
                                      -9-


                  (viii)   If the Transfer of the Leased  Premises does not take
                           place within one hundred and twenty (120) days of the
                           giving of consent  by the  Landlord  (or such  longer
                           period  as may be  agreed  upon by the  parties)  the
                           consent shall, at the Landlord's  option,  expire and
                           become null and void; and

                  (ix)     If,  following any  assignment  of this Lease,  it is
                           disaffirmed,  disclaimed or terminated by any trustee
                           in bankruptcy of a  Transferee,  the original  Tenant
                           named in this Lease will be deemed on notice from the
                           Landlord  given  within sixty (60) days from the date
                           of such disaffirmation,  disclaimer or termination to
                           have   entered   into  a  Lease  with  the   Landlord
                           containing  the same terms and  conditions as in this
                           Lease.

         (b)      If a Transfer  occurs without the consent of the Landlord when
                  required,  the  Landlord  may  collect  Rent from the party in
                  whose  favour the  Transfer  was made and apply the net amount
                  collected  to the Rent herein  reserved  but no such  Transfer
                  will be considered a waiver of this covenant or the acceptance
                  of the party in whose favour the Transfer was made as a tenant
                  hereunder.

         (c)      The Landlord  shall not be liable for any claims or actions by
                  or for any  damages,  liabilities,  losses or  expenses of the
                  Tenant  arising out of the Landlord  unreasonably  withholding
                  its consent to any  Transfer and the  Tenant's  only  recourse
                  shall be to bring an  application  for a declaration  that the
                  Landlord shall grant its consent to such Transfer.

         (d)      Notwithstanding  anything to the  contrary  contained  in this
                  Lease, the Tenant shall have the right, without consent but on
                  prior written notice to the Landlord,  to effect a Transfer to
                  an  affiliate  of the partners  that  comprise The  Children's
                  Place (Canada),  LP as at the date of this Lease (as that term
                  is defined in the Business Corporations Act (Ontario)) (herein
                  called a "Permitted Transferee") provided that such Transferee
                  signs and delivers to the  Landlord  prior to the date of such
                  Transfer,  a form of  lease  assumption  agreement  reasonably
                  satisfactory to the Landlord in accordance with the provisions
                  of this Lease.  In no event  shall such  Transfer of the Lease
                  release or relieve the Tenant from any of its  obligations  or
                  liabilities under or in respect this Lease.



CHANGE OF CONTROL

  6.02  If the  Tenant  is a  private  corporation  and  any  part or all of the
corporate  shares  shall  be  transferred  by  sale,  assignment,  amalgamation,
bequest,  inheritance,  operation of law or other disposition or dispositions so
as to result in a change  in the  control  of the  corporation,  such  change of
control shall be considered a Transfer of this Lease and shall be subject to the
provisions  of Section  6.01  hereof.  The Tenant  shall make  available  to the
Landlord upon its request for inspection  and copying,  all books and records of
the Tenant, any assignee or subtenant and their respective  shareholders  which,
alone or with other data, may show the applicability or  inapplicability of this
Section.  So long as the  Tenant is The  Children's  Place  (Canada),  LP or its
permitted  Transferee,  a change in the effective  voting  control of the Tenant
effected by a transfer of shares of the Tenant in a recognized stock exchange in
Canada or the United  States of America  shall not  require  the  consent of the
Landlord; however, the Tenant shall provide notice thereof to the Landlord.

SUBLET OF PART OF PREMISES

  6.03  Notwithstanding  anything  else to the  contrary  provided in this Lease
and/or any act or rule of law or  regulation  now or  hereafter  in force to the
contrary,  the Landlord may in its sole and unfettered discretion refuse to give
its  consent to any  Transfer by the Tenant of less than the whole of the Leased
Premises resulting in more than three (3) separate premises therein.

EXCESS RENT

  6.04 In the event that the Basic Rent payable  under any Transfer is in excess
of the Basic Rent reserved hereunder or is in excess of the proportionate  Basic
Rent reserved in the event of a sublease of part of the Leased Premises, whether
the excess be in the form of cash,  goods or  services  from the  Transferee  or
anyone  acting on its behalf,  the Tenant shall pay fifty  percent (50%) of such
excess to the Landlord immediately upon receipt thereof,  after the Tenant shall
have  deducted any brokerage  fees or other  expenses  incurred  related to such
Transfer;  in the event that such  excess is  represented  by goods or  services
rendered  to the Tenant or its  nominee,  the value of those  goods or  services
shall be  determined  by the Landlord and Tenant and fifty percent (50%) of that
value shall be paid in cash to the Landlord immediately upon such determination.
Notwithstanding  anything to the contrary set forth herein, the Tenant shall not
be required to make any payment  described in this  Section  6.04 in  connection
with a transfer to a Permitted Transferee.

MORTGAGE OF LEASEHOLD

  6.05 The Tenant shall not mortgage,  pledge, hypothecate or otherwise encumber
all or any  portion of the  Tenant's  interest  in this  Lease or the  Leasehold
Improvements  and shall not permit any lender to register any security  interest
against title to the Lands.



<PAGE>
                                      -10-


ADVERTISING PREMISES

  6.06 The Tenant shall not advertise or allow the Leased  Premises or a portion
thereof  to be  advertised  as  being  available  for  assignment,  sublease  or
otherwise  without the prior  written  approval of the  Landlord as to the form,
size,  content and location of such  advertisement,  which approval shall not be
unreasonably  withheld,  provided that (i) no such advertising shall contain any
reference  to the Rent for the  Leased  Premises  and (ii) any such  advertising
shall be on a standard ground-mounted real estate sign.

DISPOSITION BY LANDLORD

  6.07 If the Landlord sells or leases the Leased  Premises or any part thereof,
or assigns this Lease,  and to the extent that the covenants and  obligations of
the Landlord under this Lease are assumed by the purchaser,  lessee or assignee,
the Landlord, without further written agreement, will be discharged and relieved
of liability under the said covenants and obligations.

                                ARTICLE VII - USE

USE OF LEASED PREMISES

  7.01   (a)      Subject to paragraph (b) of this Section, the Tenant shall not
                  use the Leased  Premises  nor allow the Leased  Premises to be
                  used for any purpose other than  warehousing and  distribution
                  of non hazardous  and  environmentally  friendly  products and
                  ancillary office use related  thereto,  but only to the extent
                  (i) in compliance  with the  provisions of this Lease and (ii)
                  permitted   by  all   Applicable   Laws,   by-laws  and  other
                  governmental regulations from time to time in force.

         (b)      The Tenant  covenants to not use or permit the Leased Premises
                  to be used for any retail sales whatsoever.

OBSERVANCE OF LAW

  7.02 The Tenant shall comply promptly with and conform to the  requirements of
all applicable statutes, by-laws, laws, regulations,  ordinances and orders from
time to time or at any time in force during the Term and any renewal thereof and
affecting the condition,  maintenance,  repair,  use or occupation of the Leased
Premises (or equipment therein) and with every applicable regulation,  order and
requirement of the Insurance  Advisory  Organization  or any body having similar
functions or of any  liability or fire  insurance  company by which the Landlord
and the Tenant or either of them may be  insured at any time  during the Term or
renewal  thereof,  and,  in the event of the  default  of the  Tenant  under the
provisions  of this  Section,  the  Landlord  may  itself  comply  with any such
requirements  as  aforesaid  and the  Tenant  will  forthwith  pay all costs and
expenses incurred by the Landlord plus a management fee of fifteen percent (15%)
of such costs and  expenses in this  regard and the Tenant  agrees that all such
costs and  expenses  shall be  recoverable  by the  Landlord as if the same were
Additional Rent reserved and in arrears under this Lease.

WASTE AND NUISANCE

7.03     (a)      The Tenant shall not do,  suffer or permit any waste,  damage,
                  disfiguration or injury to the Leased Premises or the fixtures
                  and  equipment  thereof and shall not use or permit to be used
                  any part of the Leased Premises for any dangerous,  noxious or
                  offensive trade or business nor cause or permit any fire alarm
                  to be falsely triggered (and in the case of any alarm response
                  charge levied by the local fire  department  the cost thereof,
                  plus the  Landlord's  fifteen  percent (15%)  management  fee,
                  shall be paid by the Tenant to the  Landlord on  demand),  nor
                  use the Leased Premises in any manner which, in the opinion of
                  the  Landlord  acting   reasonably,   is  detrimental  to  the
                  Building,  nor keep, sell, use, handle or dispose of any goods
                  or things which may be objectionable nor cause or maintain any
                  nuisance  in,  at or on the  Leased  Premises  nor  cause  any
                  annoyance,  nuisance or disturbance to the occupiers or owners
                  of any  adjoining  lands  and/or  premises  and shall keep the
                  Leased Premises free of hazardous waste and contamination.

         (b)      The Tenant covenants and agrees to utilize the Leased Premises
                  and  operate  its  business in a manner so that no part of the
                  Leased  Premises or  surrounding  lands are used to  generate,
                  manufacture,  refine, treat, transport, store, handle, dispose
                  of,  transfer,  produce or process any  Hazardous  Substances,
                  except  in  strict  compliance  with all  applicable  federal,
                  provincial and municipal  statutes,  by-laws and  regulations,
                  including  without  limitation,  environmental,  land  use and
                  occupational   and  health  and  safety   laws,   regulations,
                  requirements,  permits,  statutes,  by-laws  and  regulations.
                  Furthermore,  and without  limiting the foregoing,  the Tenant
                  covenants  and agrees  with the  Landlord  not to install  any
                  underground storage tanks at the Leased Premises.  Further the
                  Tenant  hereby  covenants  and  agrees to  indemnify  and save
                  harmless  the  Landlord  and those for whom the Landlord is in
                  law  responsible  from  any and  all  losses,  costs,  claims,
                  damages,   liabilities,   expenses  or   injuries   caused  or
                  contributed  to by any Hazardous  Substances  which are at any
                  time located,  handled,  placed, stored or incorporated in any
                  part of the Leased Premises. The Tenant hereby agrees that the
                  Landlord  or its  authorized  representatives  shall  have the
                  right at the Landlord's expense, to conduct such environmental
                  site  reviews and  Investigations  (herein  "Audit") as it may
                  deem  necessary for the purposes of ensuring  compliance  with
                  this Section 7.03 provided that if such Audit  discloses  that
                  the Tenant is in violation of this  Section  7.03,  such Audit
                  shall be at the Tenant's  expense,  payable as Additional Rent
                  within  fifteen (15) days of receipt of an invoice  therefore.
                  The Tenant's  obligations  pursuant to this Section 7.03 shall
                  survive the expiration or earlier termination of the Term.



<PAGE>
                                      -11-

SIGNS

  7.04 The  Tenant  covenants  and agrees not to affix or display or cause to be
affixed or displayed any sign or signs on any part of the Building  visible from
its exterior (including,  without limitation,  the window signage),  without the
prior written approval of the Landlord, which approval shall not be unreasonably
withheld or delayed,  and subject to applicable municipal and other governmental
regulations.  The Tenant  shall at its own cost  remove all such  signage at the
expiration  of the Term,  or other sooner  termination  thereof,  and  forthwith
repair all damage  which may be caused or  occasioned  by such  affixing  and/or
removal and this covenant  shall survive the expiry or other  termination of the
Term.  Subject to the  foregoing,  the  Tenant  shall be  entitled  to place one
building  mounted  corporate  sign on the  exterior of the Leased  Premises in a
location to be agreed upon by the  Landlord  and Tenant as well as on any pylon,
monument,  directional or peripheral  sign on the Leased  Premises  denoting its
occupancy therein, all at the Tenant's sole cost and expense; provided, however,
it shall be the Landlord's  responsibility  to provide the electrical  wiring to
the exterior building mounted corporate sign location.

OUTSIDE STORAGE

  7.05 The Tenant  shall not store any goods or matter of any kind  outside  the
Building  without  the express  written  consent of the  Landlord  first had and
obtained.  Notwithstanding anything to the contrary set forth herein, the Tenant
shall be permitted to have  trailers  parked in the  chain-link  fenced-in  area
adjacent to shipping/receiving area being provided by the Landlord in accordance
with Schedule "D".

OVERLOADING FLOORS

  7.06 The Tenant  covenants that it will not bring upon the Leased  Premises or
any part thereof any machinery,  equipment,  article or thing that, by reason of
its weight, size, configuration, operation or otherwise, might damage the Leased
Premises  and will not at any time  overload  or damage the floors of the Leased
Premises.  The Tenant shall remove any such machinery,  equipment (including but
not limited to mobile  equipment  such as a  forklift),  article or thing within
five (5) days' written  notice thereof and if any damage is caused to the Leased
Premises by any machinery,  equipment,  article or thing or by overloading,  the
Tenant shall forthwith repair such damage at its own expense to the satisfaction
of the Landlord.

PARKING

  7.07 The Tenant  shall have the right to park not more than  eighty  (80) cars
belonging to its employees,  servants, agents, contractors and invitees in those
areas on the Lands designated by the Landlord from time to time as parking areas
for the Leased  Premises and shall not park nor permit its employees,  servants,
agents,  contractors  or  invitees to park in any other  areas  whatsoever.  The
Tenant  shall not park nor  permit  to be parked  any  vehicles  (cars,  trucks,
trailers,  or  otherwise)  anywhere  on the Lands at any time other than at such
areas so designated by the Landlord.  The Landlord  acknowledges that the Tenant
will have trailers  parked in the chain-link  fenced-in  area for  truck/trailer
parking  adjacent to  shipping/receiving  area being provided by the Landlord in
accordance with Schedule "D".

                     ARTICLE VIII - INSURANCE AND INDEMNITY

TENANT'S INSURANCE

   8.01  The  Tenant  shall,  at its  expense,  obtain  and  maintain  in  force
throughout  the Term  and any  period  when it is in  possession  of the  Leased
Premises,  in the  name of the  Tenant  with  the  Landlord  and the  Landlord's
mortgagee (if any) as additional insureds, the following insurance:

         (a)      Public Liability insurance,  written on a comprehensive basis,
                  with coverage  against  third-party  claims for bodily injury,
                  including  death,  and  property  damage  (including  but  not
                  limited to  personal  injury  liability,  blanket  contractual
                  liability,  products liability,  employers liability, owners &
                  contractors protective liability, and tenant's legal liability
                  for the full  replacement  cost of the Leased  Premises)  with
                  such  coverage  to  include  the   activities  and  operations
                  conducted  by the  Tenant,  or for which the Tenant is legally
                  liable,  and any other person performing work on behalf of the
                  Tenant and those for whom the Tenant is in law responsible, in
                  amounts  required by the  Landlord  and any  mortgagee  of the
                  Building or any part thereof from time to time but in no event
                  less than Five Million Dollars ($5,000,000.00) per occurrence;
                  and

         (b)      All risks insurance covering all property owned by the Tenant,
                  or installed by or on behalf of the Tenant, located within the
                  Leased Premises and all other property for which the Tenant is
                  responsible  pursuant  to this  Lease  and/or  which  has been
                  installed  by or on behalf of the  Tenant  (including  without
                  limitation   chattels,   equipment,    machinery,   furniture,
                  inventory,  fixtures, property of others in your care, custody
                  or control, and all Leasehold Improvements) in an amount equal
                  to the full (100%) replacement value thereof; and



<PAGE>
                                      -12-


         (c)      If the Tenant  modifies the Leased Premises to install its own
                  boilers,  pressure vessels or air-conditioning  equipment, the
                  Tenant  shall  obtain   comprehensive   boiler  and  machinery
                  insurance  on a blanket  repair  and  replacement  basis  with
                  limits  for  each  accident  in  an  amount  of at  least  the
                  replacement  cost  of all  leasehold  improvements  and of all
                  boilers,  pressure  vessels,  air  conditioning  equipment and
                  miscellaneous  electrical  apparatus or  mechanical  equipment
                  owned or operated  by the Tenant or by others  (except for the
                  Landlord) on behalf of the Tenant in the Leased  Premises,  or
                  relating to or serving the Leased Premises; and

         (d)      Business  interruption   insurance  in  an  amount  that  will
                  reimburse  the Tenant for direct or indirect  loss of earnings
                  attributable  to all perils insured against under Section 8.01
                  (b) and (c) herein,  and other perils commonly insured against
                  by prudent tenants, or attributable to prevention of access to
                  the Leased Premises as a result of those perils; and

         (e)      (i)      Environmental  Impairment  Liability insurance ("EIL"
                           insurance)  for  claims  arising  from  the use of or
                           operations at the Leased Premises, including coverage
                           for  sudden  and  accidental  and  gradual  pollution
                           conditions,  and including  incidents  arising out of
                           the  storage,  disposal,  release  or  escape  of any
                           Hazardous   Substances   into  or  upon  the   Leased
                           Premises,   land,  sediments,   soils,   groundwater,
                           atmosphere,  or any watercourse or body of water, and
                           for all  third-party  claims  for  bodily  injury  or
                           property  damage  as  well as the  cost  of  clean-up
                           and/or    remediation   of   any   contamination   or
                           environmental  hazard  in,  upon or around the Leased
                           Premises,  Lands and adjoining lands, which insurance
                           shall  be  issued  for a limit of no less  than  Five
                           Million Dollars ($5,000,000.00) per claim; and

                  (ii)     In the case of the  Tenant in use and  occupation  of
                           the  Leased  Premises  being  The  Children's   Place
                           (Canada),  LP, the Landlord  acknowledges  that as of
                           the  Commencement  Date the Tenant is not required to
                           obtain  "gradual  pollution"   insurance  unless  the
                           Landlord,  in its discretion,  determines at any time
                           thereafter   that  the   Leased   Premises   contains
                           Hazardous   Substances   for  which  the   Tenant  is
                           responsible or the use permitted  under this Lease is
                           modified or changed,  with or without the  Landlord's
                           consent,  at which time the Tenant  shall comply with
                           the original  requirement for "EIL" insurance set out
                           in Section  8.01 (e) (i) above  covering  both sudden
                           and accidental and gradual  pollution  exposures.  In
                           the  event  the  Tenant  is not  required  to  obtain
                           "gradual   pollution"   insurance  pursuant  to  this
                           Section  8.01  (e)  (ii),  the  Tenant  shall  obtain
                           Limited Pollution liability insurance covering claims
                           for bodily injury or property damage resulting from a
                           sudden and accidental discharge, emission, dispersal,
                           seepage,  leakage,  migration,  release  or escape of
                           Pollutants in or upon land, the atmosphere,  drainage
                           or sewage  system,  watercourse or any body of water,
                           upon  or  around  the  Leased  Premises,   lands  and
                           adjoining lands,  and/or caused by the heat, smoke or
                           fumes from a fire  which  becomes  uncontrollable  or
                           breaks out from where it was  intended to be, as well
                           as the cost of  clean-up  and/or  remediation  of any
                           contamination  or  environmental  hazard arising from
                           the use of or operations at the Leased Premises, with
                           a  limit  of  no  less  than  Five  Million   Dollars
                           ($5,000,000.00)  per  claim.  In all other  instances
                           "EIL"  insurance in accordance  with Section 8.01 (e)
                           (i)  shall  be  obtained  by  the  Tenant  including,
                           without limitation, upon any assignment of this Lease
                           or  sublease  of all or part of the Leased  Premises.
                           (f)  Standard   owners  form   automobile   insurance
                           providing  third-party  liability  insurance with Two
                           Million Dollars ($2,000,000.00) inclusive limits, and
                           accident  benefits  insurance,  covering all licensed
                           vehicles  owned or  operated  by or on  behalf of the
                           Tenant; and

         (g)      Such other forms of insurance as may be reasonably required by
                  the Landlord and its mortgagee from time to time.

All  policies  shall:  (i)  contain a cross  liability  and/or  severability  of
interest  clause;  (ii) be primary and  non-contributing  to any other insurance
available to the Landlord and/or its mortgagee(s); (iii) not be invalidated with
respect to the interests of the Landlord and its  mortgagee(s)  by reason of any
breach or violation of warranties,  representations,  declarations or conditions
contained in the policies;  and (iv) contain an  undertaking  by the insurers to
notify the  Landlord  and its  mortgagee(s)  in writing not less than sixty (60)
days prior to any material change, cancellation or termination thereof and shall
be  subject  only to such  deductibles  and  exclusions  as are  reasonable  and
customary to  businesses  similar to that of the Tenant.  All  policies  written
pursuant to paragraph  (b), (c) or (d) of this Section shall contain a waiver of
any subrogation rights which the Tenant's insurers may have against the Landlord
and its mortgagees. Any policy written pursuant to paragraph (e) of this Section
shall include a contractual  liability clause and coverage for liability arising
from the  escape  of  Hazardous  Substances  (whether  sudden or  accidental  or
gradual) from any storage  tanks,  whether above ground or below ground,  if any
such storage tanks are present at the Leased Premises. The Tenant shall promptly
furnish,  upon request from the Landlord,  verification  of compliance  with the
provisions of this Section.



<PAGE>
                                      -13-


The Tenant  agrees to furnish upon request  from the  Landlord  verification  of
compliance  with the provisions of this Section 8.01. The Tenant may self insure
the  coverage  provided for under  Section  8.01(b) if the Tenant's Net Worth as
verified by a current  audited  balance  sheet  discloses  that the Tenant's Net
Worth exceeds Fifty Million Dollars ($50,000,000.00)  provided that in such case
the Tenant shall be deemed to have received  insurance  proceeds in the event of
any loss to the extent of such loss.  Notwithstanding  anything to the  contrary
contained in this Lease, the Tenant's obligation to carry the insurance required
herein may be  satisfied  by a blanket  policy of  insurance  maintained  by the
Tenant  provided  that (i) the amount of such blanket  policy is  reasonable  in
relation to the number of locations covered; (ii) the coverage afforded will not
be reduced or diminished by reason thereof; (iii) the Leased Premises under this
Lease are  specifically  referenced in the Tenant's  policy;  and (iv) all other
requirements  of this Section are met.  "Net Worth" shall mean the  shareholders
equity in the  Tenant  (being  the  amount of its total  assets in excess of the
amount of its total  liabilities)  less its goodwill and other intangible assets
as set forth in its current audited balance sheet.

LANDLORD'S INSURANCE

  8.02 The  Landlord  shall,  throughout  the  Term,  keep at the sole  cost and
expense of the Tenant,  the Building and appurtenances  thereto,  insured to the
following extent:

         (a)      against such loss or damage as are customarily insured against
                  under a policy of insurance commonly known as a Multi-Peril or
                  All-Risk policy;

         (b)      blanket broad boiler and pressure vessel  insurance  including
                  repair or replacement;

         (c)      loss of rental income insurance with respect to fire and other
                  usual perils for which such  insurance is  customarily  issued
                  for a period (as  selected by the  Landlord)  of not less than
                  six (6) months and not more than  twelve  (12)  months for the
                  Basic Rent and other sums  payable  as  Additional  Rent under
                  this Lease; and

         (d)      other  casualties  as are  customarily  insured  against under
                  insurance  contracts  normally  entered into from time to time
                  during  the  Term by  owners  of  buildings  in the  area of a
                  character similar to the Leased Premises in such amounts as in
                  the reasonable opinion of the Landlord is necessary to protect
                  the Landlord against loss or damage.

Notwithstanding  anything contained in this Lease,  including but not limited to
the  covenant  of the  Landlord  to take  out  the  aforesaid  insurance  or the
contribution of the Tenant to the cost of such insurance,  nothing in this Lease
shall confer any insurable interest upon the Tenant in respect of such insurance
and the Tenant  acknowledges that it has no right to receive the proceeds or any
part thereof from such  insurance  policies.  All policies  written  pursuant to
paragraphs  (a),  (b) and (c) of this  Section  shall  contain  a waiver  of any
subrogation rights which the Landlord's insurers may have against the Tenant or,
if such waiver is not available from the Landlord's insurer,  the Landlord shall
arrange  to add the  Tenant  as an  additional  insured  on such  coverage.  The
Landlord,  on an annual  basis,  shall  provide  the  Tenant  with  certificates
endorsing the foregoing  coverage.  Insurance costs under this Section shall not
exceed the rate of $0.05 per square foot of Rentable Area of the Leased Premises
per annum for the first Year of the Term.

LIMIT OF LANDLORD'S LIABILITY

   8.03  (a)      The  Landlord  shall  not be  responsible  in any  way for any
                  injury to any person  (including  but not limited to death) or
                  for any loss of or damage  to any  property  belonging  to the
                  Tenant or to other  occupants  of the  Leased  Premises  or to
                  their respective  employees,  agents,  invitees,  licensees or
                  other  persons  from  time to  time  attending  at the  Leased
                  Premises  while  such  person or  property  is in or about the
                  Leased Premises, including without limiting the foregoing, any
                  loss of or damage to any property caused by theft or breakage,
                  or by  steam,  water,  rain or snow or for any loss or  damage
                  caused by or  attributable to the condition or arrangements of
                  any  electrical  or other  wiring or for any damage  caused by
                  smoke or for any other  loss  whatsoever  with  respect to the
                  Leased Premises,  goods placed therein or any business carried
                  on therein.

         (b)      In the event that the Leased  Premises [or the Complex] or any
                  part or parts thereof are closed,  inaccessible or unusable by
                  reason of damage,  necessary  repair or by virtue of any other
                  cause or condition  whatsoever,  whether  within or beyond the
                  Landlord's  control,  the  Landlord  shall  not be  liable  or
                  responsible  in any way for any loss of  business or any other
                  damage  to  or  loss,  direct,   indirect,   consequential  or
                  otherwise  sustained  or  suffered by the Tenant nor shall the
                  Tenant be entitled to any  abatement of Rent,  except,  in the
                  case  of  damage  to the  Leased  Premises  and  as  expressly
                  provided in Article IX hereof.

LIMIT OF TENANT'S LIABILITY

   8.04 The Tenant shall not be liable to the  Landlord  for any direct  injury,
loss or damage  required to be insured by the Landlord  pursuant to Section 8.02
to the extent of the proceeds actually  recovered by the Landlord or which would
have been  recovered had the Landlord  complied  with its insurance  obligations
hereunder,  and which is in excess of $50,000.00 per occurrence,  whether or not
such injury loss or damage is caused by the Tenant,  or its officers,  directors
or  employees,  provided  that the Tenant  promptly  advises the Landlord of the
occurrence of such injury loss or damage,  and the Tenant shall be and is hereby
released  in  respect  of the same,  it being  understood  and  agreed  that the
Landlord  shall not be  required to look to its  insurance  under  Section  8.02
hereof for  losses of  $50,000.00  or less and in such case the Tenant  shall be
responsible for the cost thereof.



<PAGE>
                                      -14-


INDEMNITY

   8.05     (INTENTIONALLY DELETED)


                       ARTICLE IX - DAMAGE AND DESTRUCTION

ABATEMENT OF RENT

  9.01 If the Building or any portion thereof is damaged or destroyed by fire or
by other  casualty  against  which the Landlord is required to insure under this
Lease,  Rent  shall  abate  in  proportion  to the area of that  portion  of the
Building which, in the reasonable opinion of the Landlord's  insurer, is thereby
rendered  unfit for the  purposes of the Tenant  bears to the area of the entire
Building  (but  only to the  extent  to which  the  Landlord  actually  receives
proceeds  under its loss of rental  income  insurance  or which  would have been
received if the Landlord had complied with its  obligations  under paragraph (c)
of Section  8.02) until the Building is repaired and rebuilt as certified by the
Landlord's  Architect  and the  Landlord  agrees that it will,  with  reasonable
diligence,  repair and  rebuild  the  Building,  subject to  Section  9.02.  The
Landlord's  obligation to rebuild and restore the Building shall not include the
obligation  to  rebuild,  restore,  replace  or  repair  any  chattel,  fixture,
Leasehold  Improvements,  or any other thing that is the  property of the Tenant
and/or for which the Tenant is to maintain insurance under paragraph (b) and (c)
of Section 8.01 (in this Section  collectively called "Tenant's  Improvements");
the Building shall be deemed repaired and rebuilt when the Landlord's  Architect
certifies that the Building has been  substantially  repaired and rebuilt to the
state where the Tenant could occupy it for the purpose of rebuilding, restoring,
replacing  or  repairing  the  Tenant's   Improvements.   The  issuance  of  the
certificate  of the Landlord's  Architect  shall not relieve the Landlord of its
obligation to complete the repairing and rebuilding as aforesaid, but the Tenant
shall forthwith after issuance of such certificate proceed to rebuild,  restore,
replace and repair the Tenant's Improvements, and the provisions of Section 5.03
shall apply to such work, mutatis mutandis.

TERMINATION

  9.02     Notwithstanding the provisions of Section 9.01 hereof, if:

         (a)      the Building or any portion thereof is damaged or destroyed by
                  any cause  whatsoever and cannot in the reasonable  opinion of
                  the  Landlord  be rebuilt or made fit for the  purposes of the
                  Tenant as  aforesaid  within one hundred and eighty (180) days
                  from the date of such damage or destruction; or

         (b)      the Building is damaged or destroyed by an uninsured peril,

the Landlord may, at its option,  terminate  this Lease by giving to the Tenant,
within sixty (60) days' after the date of such damage or destruction,  notice of
termination and thereupon Rent shall be apportioned and paid to the date of such
damage or destruction and the Tenant shall immediately  deliver up possession of
the Leased Premises to the Landlord. If the Landlord does not elect to terminate
the Lease it shall  repair and  rebuild  the  Building  in  accordance  with the
provisions of Section 9.01 hereof.

                               ARTICLE X - DEFAULT

EVENTS OF DEFAULT

  10.01    An "Event of Default" shall occur whenever:

         (a)      the Tenant  fails to pay the Rent hereby  reserved or any part
                  thereof within ten (10) days after Tenant's receipt of written
                  notice   thereof   given  by  the   Landlord  to  the  Tenant.
                  (Notwithstanding  the  foregoing,  it is understood and agreed
                  that if the Tenant is a party other than The Children's  Place
                  (Canada),  LP or a Permitted  Transferee  specified in Section
                  6.01 of  this  Lease  and the  Landlord  is  required  to give
                  written notice twice in any 12 consecutive month period during
                  the Term to that other party,  then the Landlord  shall not be
                  required  to  thereafter  give  notice and an Event of Default
                  shall occur if the other party fails to pay Rent,  or any part
                  thereof,  on the day  appointed  for payment  thereof  whether
                  lawfully demanded or not);

         (b)      the Tenant shall have breached or failed to comply with any of
                  its covenants and agreements contained in this Lease (save for
                  non-payment  of Rent) and  shall  have  failed to remedy  such
                  breach or  non-compliance  within  fifteen  (15) days (or such
                  longer period as may reasonably be required,  having regard to
                  the nature of the default)  after written notice thereof given
                  by the Landlord to the Tenant;



<PAGE>
                                      -15-


         (c)      the  Tenant  shall  make any  assignment  for the  benefit  of
                  creditors or become  bankrupt or insolvent or take the benefit
                  of any  Act  now or  hereinafter  in  force  for  bankrupt  or
                  insolvent debtors;

         (d)      the Tenant is a  corporation  and any order  shall be made for
                  the  winding-up  of the  Tenant  or other  termination  of the
                  corporate existence of the Tenant;

         (e)      the Tenant makes or attempts to make a bulk sale of assets not
                  in the ordinary course of the Tenant's business;

         (f)      a trustee, receiver,  interim receiver,  receiver and manager,
                  custodian  or   liquidator  is  appointed  for  the  business,
                  property,  affairs or revenue of the Tenant and such appointed
                  individual is not removed within ten (10) days;

         (g)      this  Lease  or any  of  the  Tenant's  assets  on the  Leased
                  Premises  are  taken or seized  under  writ of  execution,  an
                  assignment,   pledge,  charge,  debenture  or  other  security
                  instrument;

         (h)      the  Tenant   abandons  or  attempts  to  abandon  the  Leased
                  Premises;

         (i)      the Tenant  makes or applies to the relevant  authority  for a
                  permit  or  approval   for,  any   installation,   alteration,
                  addition,  modification  or improvement to the Leased Premises
                  without the prior  written  approval or  authorization  of the
                  Landlord as required under Section 5.03 hereof;

         (j)      the Leased Premises shall be used by any person other than the
                  Tenant or the Tenant's permitted  assignees or for any purpose
                  other than as set out in Section 7.01;

         (k)      any insurance policy on the Building or any part thereof shall
                  be  cancelled  or shall be  threatened  by the  insurer  to be
                  cancelled or the coverage thereunder reduced in any way by the
                  insurer  by  reason  of the use or  occupation  of the  Leased
                  Premises  or any part  thereof  by the  Tenant  and the Tenant
                  shall have failed to remedy the condition  giving rise to such
                  cancellation, threatened cancellation or reduction of coverage
                  within  forty-eight  (48) hours'  written  notice given by the
                  Landlord to the Tenant;

         (l)      the  Tenant  sells  or  disposes  of the  goods,  chattels  or
                  equipment  in the Leased  Premises  or removes,  commences  or
                  threatens  to remove them from the Leased  Premises so that in
                  the opinion of the  Landlord  there would not, in the event of
                  such sale,  disposal or removal,  be  sufficient  goods on the
                  Leased  Premises  subject to distress  which would satisfy all
                  Rent due or accruing hereunder for a period of six (6) months;

         (m)      the  Tenant  shall at any  time  during  the  Term or  renewal
                  thereof  use  the  Leased  Premises,  whether  within  the use
                  permitted by Section  7.01 or not, in a manner  which  imposes
                  upon the Landlord any obligation to modify,  extend,  alter or
                  replace  any  part  of  the  Leased  Premises  or  any  of the
                  machinery,  equipment or other  facilities  used in connection
                  with the Leased Premises, which obligation is not fulfilled by
                  the Tenant at its own cost in a timely manner; or

         (n)      the  Leased  Premises  are  vacant for any period in excess of
                  fifteen (15) days other than during repairs or renovations.

Notwithstanding  the Bankruptcy  and Insolvency Act (Canada) or otherwise,  upon
the  occurrence of an Event of Default,  the then current  month's Rent and next
ensuing three (3) months' Rent shall  immediately  become due and be paid by the
Tenant to the Landlord as  accelerated  Rent and the  Landlord  may  immediately
distrain for the same together with any Rent arrears then unpaid.

RIGHT OF RE-ENTRY

  10.02

         (a)      Upon the  occurrence of an Event of Default,  the Landlord may
                  at any time  thereafter,  upon notice to the Tenant,  re-enter
                  the  Leased  Premises  or any part  thereof in the name of the
                  whole  and  terminate  this  Lease  and all the  rights of the
                  Tenant thereunder.

         (b)      If and whenever the Landlord  exercises its option to re-enter
                  the Leased  Premises  and  terminate  this Lease  pursuant  to
                  paragraph (a) of this Section:

                  (i)      the  Tenant  shall  immediately   vacate  the  Leased
                           Premises  and the  Landlord may remove or cause to be
                           removed from the Leased  Premises  the Tenant  and/or
                           any other  occupant or  occupants  thereof and remove
                           all  property  therefrom  and sell or dispose of such
                           property  as  the  Landlord   considers   appropriate
                           without  liability  for loss or  damage  and  without
                           prejudice  to the rights of the  Landlord  to recover
                           arrears of Rent or damages incurred by the Landlord;



<PAGE>
                                      -16-


                  (ii)     the  Landlord  shall be  immediately  entitled to the
                           payment  of  Rent  up  to  the  date  of  termination
                           together  with all expenses  incurred by the Landlord
                           in respect of such termination.

RELETTING

  10.03 At any time  when the  Landlord  is  entitled  to  re-enter  the  Leased
Premises or terminate this Lease,  the Landlord may without notice to the Tenant
and  without  terminating  the Lease  enter upon and take  custody of the Leased
Premises  in the  name of and as  agent  of the  Tenant,  together  with all the
Tenant's improvements,  fixtures and furnishings, and sublet the Leased Premises
in the name of and as the agent of the Tenant on whatever terms the Landlord may
deem  appropriate  but no such  action by the  Landlord  shall  waive any of the
obligations  of the  Tenant  or  limit  the  subsequent  exercise  of any of the
Landlord's  remedies  for  default.  If the  Landlord  shall  sublet  the Leased
Premises as  aforesaid,  the Landlord  shall be entitled to receive all sublease
rent and apply the same in its discretion to any  indebtedness  of the Tenant to
the Landlord under this Lease and/or to the payment of any costs and expenses of
reletting,  and the  Landlord  shall be liable to account to the Tenant only for
the excess,  if any, of monies actually  received by it. If the sublease rent is
less than is necessary to pay and discharge all the then existing and continuing
obligations of the Tenant hereunder, the Tenant shall pay such deficiency to the
Landlord  upon demand from time to time.  Notwithstanding  any such re-entry and
subletting  without  termination,  the  Landlord  may  at  any  time  thereafter
terminate  this Lease by reason of the previous or any other  default  under the
Lease and the provisions of Section 10.02 shall apply.

DISTRESS

  10.04     (INTENTIONALLY DELETED)


RIGHT OF LANDLORD TO CURE DEFAULTS

  10.05 After the provision of any notice and/or  applicable  cure period as may
be provided  for in this Lease,  if any, if the Tenant fails to perform or cause
to be performed any of the covenants or obligations  of the Tenant  herein,  the
Landlord  shall  have the right (but  shall not be so  obligated)  to perform or
cause  to be  performed  and to do or  cause to be done  such  things  as may be
necessary or incidental thereto  (including without limiting the foregoing,  the
right to make  repairs,  installations,  erections and expend  monies),  and all
payments,  expenses,  charges, fees and disbursements  incurred or paid by or on
behalf of the  Landlord  in respect  thereof  shall be paid by the Tenant to the
Landlord  within  ten (10)  days'  written  demand  therefor  together  with all
reasonable legal and administrative costs of the Landlord in respect thereof.

REMEDIES NOT EXCLUSIVE

  10.06 Mention in this Lease of any particular remedy or remedies in respect of
any  default  or  threatened  default by the  Tenant in the  performance  of its
obligations shall not preclude the Landlord from exercising, or limit the extent
of, any other remedy in respect  thereof,  whether at law, in equity or pursuant
to any express  provision hereof. No remedy shall be interpreted as exclusive or
dependent upon any other remedy, and the Landlord may from time to time exercise
any one or more of such remedies independently or in combination.

NON-WAIVER

  10.07 No condoning,  excusing or  overlooking by the Landlord or the Tenant of
any default, breach or non-observance by the other party at any time or times in
respect of any covenant,  proviso or condition herein contained shall operate as
a waiver of the  Landlord's or the Tenant's  rights  hereunder in respect of any
continuing or subsequent default,  breach or non-observance,  or so as to defeat
or affect in any way the rights of the Landlord or the Tenant  herein in respect
of any such continuing or subsequent  default or breach,  and no waiver shall be
inferred  from or implied by  anything  done or omitted by the  Landlord  or the
Tenant, save only an express waiver by the Landlord or the Tenant in writing.

RECOVERY OF ADJUSTMENTS

  10.08 The Landlord shall have (in addition to any other right or remedy of the
Landlord)  the same rights and remedies in the event of default by the Tenant in
payment of any amount payable by the Tenant hereunder as the Landlord would have
in the case of default in payment of Rent.



                                      -17-

<PAGE>

                 ARTICLE XI - SUBORDINATION AND ACKNOWLEDGEMENTS

MORTGAGES

  11.01 At the option of the Landlord or the  applicable  mortgagee,  chargee or
trustee (as the case may be), this Lease shall be subject and subordinate to any
and all  mortgages,  charges  and deeds of trust (and  instruments  supplemental
thereto),  which may now or at any time hereafter  affect the Leased Premises in
whole  or in  part,  or the  Lands,  or the  Building  whether  or not any  such
mortgage,  charge or deed of trust affects only the Leased Premises or the Lands
or the Building or affects other premises as well. The Tenant  acknowledges  and
agrees that any such mortgagee, chargee or trustee may unilaterally postpone and
subordinate  its  mortgage,  charge  or deed of  trust  to  this  Lease  and any
renewals, modifications,  consolidations,  replacements or extensions thereof to
the intent  that this Lease and all right,  title and  interest of the Tenant in
the Leased  Premises shall be prior to the rights of such  mortagee,  chargee or
trustee as fully as if such Lease had been  executed and  registered  before the
registration of the mortgage, charge or deed of trust, as applicable. On request
at any time and from time to time of the Landlord or of the  mortgagee,  chargee
or trustee under any such  mortgage,  charge or deed of trust,  the Tenant shall
promptly,  at no cost to the  Landlord or  mortgagee,  chargee or  trustee,  but
provided that the holder of any such mortgage, charge or deed of trust agrees in
writing with the Tenant not to disturb the Tenant's  use and  occupation  of the
Leased  Premises so long as the Tenant is not in default under this Lease beyond
applicable notice and cure periods:

         (a)      attorn to such  mortgagee,  chargee or trustee  and become its
                  tenant of the  Leased  Premises  or the  tenant of the  Leased
                  Premises  of any  purchaser  from such  mortgagee,  chargee or
                  trustee in the event of an exercise of any permitted  power of
                  sale contained in any such  mortgage,  charge or deed of trust
                  for the then unexpired residue of the Term on the terms herein
                  contained; and/or

         (b)      postpone and subordinate  this Lease to such mortgage,  charge
                  or deed of trust to the intent  that this Lease and all right,
                  title and interest of the Tenant in the Leased  Premises shall
                  be subject to the rights of such mortgagee, chargee or trustee
                  as fully as if such mortgage, charge or deed of trust had been
                  executed and registered and the money thereby secured had been
                  advanced   before   the   execution   of   this   Lease   (and
                  notwithstanding any authority or consent of such mortgagee, or
                  trustee, express or implied, to the making of this Lease).

  Any such  attornment or  postponement  and  subordination  shall extend to all
renewals, modifications,  consolidations, replacements and extension of any such
mortgage, charge or deed of trust and every instrument supplemental or ancillary
thereto or in  implementation  thereof.  The Tenant shall forthwith  execute any
instruments  of attornment or  postponement  and  subordination  which may be so
requested to give effect to this Section.  The Tenant shall,  if required,  also
confirm to the Landlord's mortgagee:  (i) that no prepayments of rent (except as
provided  in this  Lease) and no  material  amendments  of this  Lease  shall be
binding on such mortgagee unless the mortgagee  consents thereto;  (ii) that the
mortgagee  shall not be liable for any default of the Landlord  under this Lease
arising prior to the mortgagee  becoming a mortgagee in possession of the Leased
Premises or succeeding to the Landlord's  interest in this Lease; (iii) that the
mortgagee  shall be  responsible  for landlord  obligations  only so long as the
mortgagee  realizes on its security by entering  into  ownership,  possession or
control  of the Leased  Premises;  and (iv) that the Tenant  will  deliver  such
mortgagee, simultaneously with delivery to the Landlord, a copy of any notice to
the  Landlord  alleging  default by the Landlord of its  obligations  under this
Lease;  provided  however,  in no event  shall the Tenant be required to provide
such  confirmation  more  than two (2) times in any  twelve  (12)  month  period
without charge to the Landlord.

CERTIFICATES

  11.02 The Tenant shall,  within not more than ten (10) days'  written  request
therefor, execute and return to the Landlord or its mortgagee as required by the
Landlord from time to time and without cost to the Landlord or its mortgagee,  a
statement in writing  certifying that this Lease is unmodified and in full force
and effect (or if modified,  stating the  modifications and that the Lease is in
full force and  effect as  modified),  the amount of the annual  Basic Rent then
being paid hereunder,  the dates to which the same, by installment or otherwise,
and other charges hereunder have been paid, whether or not there is any existing
default on the part of the  Landlord  of which the Tenant  has  notice,  and any
other information  reasonably required;  provided however, in no event shall the
Tenant be required to provide such  confirmation  more than two (2) times in any
twelve (12) month period without charge to the Landlord.

                        ARTICLE XII - ACCESS BY LANDLORD

ENTRY BY LANDLORD

12.01    (INTENTIONALLY DELETED)


EXHIBITING LEASED PREMISES

  12.02 The Tenant shall permit the Landlord or its agents to exhibit the Leased
Premises  to  prospective  tenants  during  the last six (6)  months of the Term
thereof  during normal  business  hours upon at least 24 hours  advance  notice.
Notwithstanding  the  foregoing,  in the event the Tenant does not  exercise any
option that is  available  to it to renew or extend the Term,  the  Landlord may
(during business hours after at least twenty-four (24) hours notice) exhibit the
Leased  Premises at any time after the  earlier of the date the Tenant  notifies
the Landlord  that it will not be  exercising  such option or, in the absence of
such notice, the last day on which the Tenant may exercise such option.



                                      -18-
<PAGE>


                          ARTICLE XIII - MISCELLANEOUS

NOTICE

  13.01  (a)      Any notice,  request,  statement or other writing  pursuant to
                  this  Lease  shall be deemed  to have been  given if mailed by
                  registered  prepaid  post  or  by  facsimile  transmission  as
                  follows:


                  In the case of the Landlord, to:

                  ORLANDO CORPORATION
                  6205 Airport Road
                  5th Floor
                  Mississauga, Ontario
                  L4V lE3

                  Attention:     President

                  Facsimile #:  (905)  677-2824


                  In the case of the Tenant, to:

                  THE CHILDREN'S PLACE (CANADA), L.P.
                  c/o The Children's Place Retail Stores, Inc.
                  915 Secaucus Road
                  Secaucus, NJ 07094

                  Attention:        Vice President of Real Estate

                  Facsimile #:      (201) 558-2832


                  With a copy to:

                  THE CHILDREN'S PLACE (CANADA), L.P.
                  c/o The Children's Place Retail Stores, Inc.
                  915 Secaucus Road
                  Secaucus, NJ 07094

                  Attention:        General Counsel's office

                  Facsimile #:      (201) 558-2840


                  and such notice  shall be deemed to have been  received by the
                  Landlord or the Tenant (as  applicable)  on the third business
                  day  after  the date on which it  shall  have  been so  mailed
                  (provided that in the event that there is an  interruption  of
                  postal service,  the aforesaid  period shall be extended for a
                  period  equivalent to the period of such  interruption)  or on
                  the day of  facsimile  transmission  if made  before 5:00 p.m.
                  Eastern Time on a business day,  otherwise on the business day
                  next following, as evidenced by a written confirmation of such
                  facsimile transmission.

         (b)      Notice shall also be  sufficiently  given if and when the same
                  shall be delivered,  in the case of notice to the Landlord, to
                  an  executive  officer  of the  Landlord,  and in the  case of
                  notice to the  Tenant  to him  personally  or to an  executive
                  officer of the  Tenant  located at the  address  provided  for
                  notice herein if the Tenant is a corporation.  Such notice, if
                  delivered, shall be conclusively deemed to have been given and
                  received at the time of such delivery. If in this Lease two or
                  more  persons are named as Tenant,  such notice  shall also be
                  sufficiently  given if and when  the same  shall be  delivered
                  personally  to any one of such  persons.  Provided that either
                  party may, by notice to the other, from time to time designate
                  another  address  in Canada  or the  U.S.A.  to which  notices
                  mailed more than ten (10) days thereafter shall be addressed.


REGISTRATION

  13.02 The Tenant  covenants  and agrees with the Landlord that the Tenant will
not register or record this Lease or any part  thereof  against the title to the
Lands or any part thereof  except by way of notice which shall be subject to the
prior  written  approval  of the  Landlord  not to be  unreasonably  withheld or
delayed and which shall only describe the parties, the Leased Premises,  and the
Term and any options to renew or extend (as applicable). The Tenant covenants to
execute and return to the  Landlord  such  notice,  prepared by the  Landlord in
registrable  form  setting  out the  aforesaid  details,  within  ten (10) days'
written request  therefor.  The Landlord,  on its own behalf,  may also register
notice of this Lease,  or a short form  thereof,  against title to the Lands and
the  Tenant  hereby  appoints  the  Landlord  as its  agent for the  purpose  of
preparing and submitting any Land Transfer Tax affidavit  required in connection
with such registration.



<PAGE>
                                      -19-


PLANNING ACT

  13.03 Where  applicable,  this Lease shall be subject to the condition that it
is effective only if the Planning Act (Ontario) is complied  with.  Pending such
compliance,  the Term and any renewal  periods shall be deemed to be for a total
period of one (1) day less than the maximum lease term  permitted by law without
such compliance.

OBLIGATIONS AS COVENANTS

  13.04 Each obligation or agreement of the Landlord or the Tenant  expressed in
this Lease,  even though not  expressed  as a covenant,  is  considered  to be a
covenant for all purposes.

SEVERABILITY

  13.05  Any  provision  of this  Lease  that is  determined  to be  illegal  or
unenforceable  at law  shall  be  considered  separate  and  severable  from the
remaining  provisions  which  shall  remain  in force  and be  binding  upon the
Landlord and the Tenant.

OVERHOLDING

  13.06  If the  Tenant  shall  continue  to  occupy  all or part of the  Leased
Premises after the expiration of the Term with the consent of the Landlord,  and
without any further written  agreement,  the Tenant shall be a monthly tenant at
one hundred and  twenty-five  percent  (125%) of the monthly  Basic Rent payable
during the last year of this  Lease and  otherwise  on the terms and  conditions
herein set out except as to length of tenancy.

UNAVOIDABLE DELAYS

  13.07 Whenever and to the extent the Landlord is unable to fulfill or shall be
delayed or restricted in the  fulfillment of any obligation  hereunder by reason
of being unable to obtain the material,  goods, equipment,  service,  utility or
labour  required  to enable it to fulfill  such  obligation  or by reason of any
statute, law, regulation, by-law or order or by reason of any other cause beyond
its reasonable control,  whether of the same nature as the foregoing or not, the
Landlord shall be relieved from the  fulfillment of such  obligation for so long
as such cause continues and the Tenant shall not be entitled to compensation for
any inconvenience,  nuisance or discomfort thereby occasioned. There shall be no
deduction  from the Rent or other monies  payable  under this Lease by reason of
any such failure or cause.

EVIDENCE OF PAYMENTS

  13.08 The Tenant shall  produce to the  Landlord  upon  request,  satisfactory
evidence of due payment by the Tenant of all payments required to be made by the
Tenant under this Lease.

LIEN

  13.09     (INTENTIONALLY DELETED)

TIME OF ESSENCE

  13.10 Time shall be of the essence of this Lease and every part thereof.


LAW

  13.11 This Lease shall be governed by and  construed  in  accordance  with the
laws of the Province of Ontario.


CAPTIONS/HEADINGS

  13.12 The  captions  appearing in the margin of this Lease and in the headings
to the Articles of this Lease have been inserted as a matter of  convenience  of
reference  only and do not in any way  whatsoever  define,  limit or enlarge the
scope or meaning of this Lease or any part thereof.

JOINT AND SEVERAL LIABILITY

  13.13 If the  Tenant  shall be  comprised  of more  than  one (1)  party,  the
liability of each such party under this Lease shall be joint and several.

TENANT PARTNERSHIP

  13.14 If the Tenant shall be a partnership,  each person who shall be a member
of such partnership or successor thereof shall be and continue to be jointly and
severally   liable  for  the   performance  and  observance  of  all  covenants,
obligations  and  agreements  of the Tenant under this Lease even if such person
ceases to be a member of such partnership or successor thereof.



                                      -20-

<PAGE>

ENVIRONMENTAL ASSESSMENTS

  13.15 The  Landlord or its agent shall have the right to enter upon the Leased
Premises and conduct  environmental  assessment  audits from time to time during
the Term or any renewal thereof.

ENVIRONMENTAL MATTERS

  13.16 The Landlord  agrees that the Leased  Premises,  not taking into account
the Tenant's use, shall be in compliance with all Applicable Laws as at the date
they are delivered to the Tenant. The Landlord also warrants that to the best of
its knowledge there has been no extra hazardous use of the Leased Premises,  nor
installation  of any asbestos.  The Landlord  covenants  and agrees,  at its own
expense,  to be  responsible  for and to complete  the removal,  remediation  or
clean-up,  in accordance  with all Applicable Laws of: (i) any and all Hazardous
Substances existing at or prior to the Early Access Period, or that migrate onto
the Leased  Premises  (including  both surface and  subsurface  migration)  from
adjoining  lands,  that in  either  case  exceed  the  Ministry  of  Environment
guidelines as set out in the publication  entitled  Guideline for Remediation at
Contaminated  Sites in Ontario for  industrial/commercial  property  where it is
reasonably  demonstrated that such  contamination is injurious or detrimental to
the health of the Tenant's  employees or the Tenant's use or  occupation  of the
Leased Premises;  and (ii) any Hazardous Substances in or at the Leased Premises
caused by the Landlord or the Landlord's Employees or contractors.

EASEMENTS

  13.17 The Tenant acknowledges that the Lands are subject to such rights-of-way
and other  easements  as are  designated,  if any, in Schedule  "A" hereto.  The
Tenant agrees to postpone this Lease, upon demand by the Landlord to:

         (a)      such  further  easements  in  favour  of  adjoining  lands for
                  purposes  of  ingress  and egress as may be  requested  by the
                  Landlord from time to time; and

         (b)      easements  regarding  utilities  or sewers as may be  required
                  from time to time.

ENTIRE AGREEMENT

  13.18 The Tenant acknowledges that there have been no representations  made by
the Landlord which are not set out in the Lease. The Tenant further acknowledges
that the Lease  constitutes the entire agreement between the Landlord and Tenant
and may not be modified  except as herein  explicitly  provided or by subsequent
agreement in writing duly signed by the Landlord and the Tenant.



                                      -21-

<PAGE>


EFFECT OF LEASE

13.19 This Indenture and everything  herein  contained  shall extend to and bind
and  may  be  taken   advantage   of  by  the   respective   heirs,   executors,
administrators,  successors  and  assigns,  as the case  may be,  of each of the
parties  hereto,  subject to the granting of consent by the Landlord as provided
herein to any assignment or sublease, and where there is more than one tenant or
there is a female party or a corporation,  the  provisions  hereof shall be read
with all grammatical  changes thereby rendered necessary and all covenants shall
be deemed joint and several.

                     IN WITNESS  WHEREOF the parties  hereto have duly  executed
this Lease.



LANDLORD:                    ORLANDO CORPORATION

                             Per: /s/  Doug Kilner
                                  -------------------------------------
                                  Authorized Signing Officer
                                  Name:     Doug Kilner
                                  Position:  President

                             Per:   /s/ William O'Rourke
                                  -------------------------------------
                                  Authorized Signing Officer
                                  Name:     William O'Rourke
                                  Position:  SVP, Finance

                             WE HAVE AUTHORITY TO BIND THE CORPORATION.

TENANT:                      THE CHILDREN'S PLACE (CANADA), LP
                             BY TCP INVESTMENT CANADA II CORP., GENERAL PARTNER

                             Per:   /s/  Mario Ciampi
                                  -------------------------------------
                                  Authorized Signing Officer
                                  Name:     Mario Ciampi
                                  Position:  SVP

                             Per:  /s/  Steven Balasiano
                                  -------------------------------------
                                  Authorized Signing Officer
                                  Name:     Steven Balasiano
                                  Position:  Vice President

                             I/WE HAVE AUTHORITY TO BIND THE CORPORATION



<PAGE>

                                  SCHEDULE "A"

                              DESCRIPTION OF LANDS


P.I.N. 13214-0025 (LT)

PCL BLOCK 11-1, SEC 43M1023; PT BLK 11, PL 43M1023, PART 13, 18 TO 25, 43R20960;
S/T LT1028851, LT1558169, LT1558170 MISSISSAUGA

SUBJECT TO EASEMENTS TO CREATE A MUTUAL  DRIVEWAY  SERVICING THE LEASED PREMISES
AND THE ADJACENT LANDS FOR BRITANNIA ROAD WEST.



<PAGE>


                                 SCHEDULE "A-1"

                                    SITE PLAN








<PAGE>

                                  SCHEDULE "B"

                                   DEFINITIONS

For the purposes of this Lease:

(a)      "ADDITIONAL  RENT"  means all amounts  payable by the Tenant  under the
         provisions of this Lease, whether payable to the Landlord or otherwise,
         over and above Basic Rent.

(b)      "APPLICABLE  LAWS"  means any  statutes,  laws,  by-laws,  regulations,
         ordinances,   and   requirements  of  governmental   and  other  public
         authorities  having  jurisdiction  over  or in  respect  of the  Leased
         Premises  or  Building,  or any  portion  thereof,  and all  amendments
         thereto  at any time  and from  time to  time,  and  including  but not
         limited to the  Environmental  Protection Act,  R.S.O.1990,  c.E.19, as
         amended, and the Canadian Environmental Protection Act, R.S.C. 1985.

(c)      "BASIC RENT" means those  amounts set out as Basic Rent in Section 2.02
         of this Lease.


(d)      "BUILDING"  means the  building  erected  on the Lands and  municipally
         known as 6040 Cantay Road in the City of  Mississauga,  in the Regional
         Municipality of Peel.


(e)      "CAPITAL  TAX" means the amount  imputed by the  Landlord in respect of
         capital  or  place  of  business  taxes,  excises,  rates,  duties  and
         assessments presently or hereafter levied,  imposed,  rated, charged or
         assessed  from time to time upon the Landlord  and/or the owners of the
         Leased Premises by any government or other applicable taxing authority,
         based upon,  in whole or in part,  a reference  to or on account of the
         capital  employed or invested by the Landlord  and/or the owners of the
         Lands, the Building and improvements  thereto,  or on account of its or
         their ownership thereof.  Capital Tax shall be calculated (i) as if the
         Leased  Premises  were the only  property of the  Landlord  but without
         reference  to  exempted  amounts,  (ii) on the basis of the  Landlord's
         determination of the amount of capital attributable  thereto, and (iii)
         by multiplying the amount of capital by the applicable tax rate imposed
         without any discounts, adjustments or reductions.


(f)      "HAZARDOUS SUBSTANCES" means, without limitation, any and all hazardous
         substances,  hazardous  waste,  dangerous  goods,  toxic  waste,  toxic
         substance,  contaminants,  pollutants or related  materials,  including
         without  limitation,  heavy oil,  pesticides,  flammables,  explosives,
         radioactive materials,  asbestoses,  urea formaldehyde foam insulation,
         radon gas,  PCB,  any  products  of waste,  or any other  contaminants,
         pollutants,  substances  or products  declared to be hazardous or toxic
         under the Applicable Laws.

(g)      "LANDLORD'S ARCHITECT" means a qualified architect, engineer or Ontario
         Land Surveyor from time to time chosen by the Landlord.

(h)      "LANDS"  means the parcel of land hatched on the Site Plan  attached as
         Schedule  "A-1",  being part of the lands  described  in  Schedule  "A"
         hereto.

(i)      "LEASE"  means  this  Lease and any  schedules  annexed  hereto and any
         amendments  from time to time made to this Lease in accordance with the
         provisions herein set out.

(j)      "LEASED PREMISES" means the Lands and the Building.

(k)      "LEASEHOLD  IMPROVEMENTS" means all fixtures (save for trade fixtures),
         installations, additions, improvements and alterations made, erected or
         installed in or on the Leased Premises by or on behalf of the Tenant.

(l)      "PROPORTIONATE  SHARE" means that fraction  having as its numerator the
         Rentable  Area  of the  Building  and  having  as its  denominator  the
         Rentable  Area of all  buildings  in the  Complex as defined in Section
         3.04 of this Lease.

(m)      "RENT" means Basic Rent and Additional Rent.


<PAGE>

                                                         Page #2 of Schedule "B"


(n)      "RENTABLE AREA OF THE BUILDING" means the area of the Building measured
         in accordance  with the SIOR  standard of  measurement  for  industrial
         buildings.

(o)      "TAXES"  means  all  taxes,  rates,  duties,   levies  and  assessments
         whatsoever   (imposed  by  any  and  all  taxing   authorities   having
         jurisdiction)  levied,  charged or assessed upon the Lands and Building
         or upon any part or parts thereof and all improvements now or hereafter
         erected or placed on the Lands,  or charged  against  the  Landlord  on
         account thereof, including but not limited to local improvement charges
         (but  excluding  profit and excess profit taxes and taxes assessed upon
         the income of the Landlord). In addition to the foregoing,  Taxes shall
         include any and all taxes, charges,  levies or assessments which may in
         the  future be  levied,  charged  or  assessed  in lieu  thereof  or in
         addition  thereto.  Taxes  shall also  include  all costs and  expenses
         incurred  by the  Landlord  in  obtaining  or  attempting  to  obtain a
         reduction or prevent an increase in the amount  thereof and the cost of
         all  consultants,  solicitors and accountants  retained by the Landlord
         with respect  thereto.  Taxes shall also include a management fee of up
         to five percent (5%) per annum of the  foregoing  amounts  incurred for
         the Landlord's services in administering, determining and appealing the
         Taxes, as may be applicable.


(p)      "TERM"  means that period of time set out in Section 1.02 of this Lease
         (and any and all extensions or renewals thereof, as may be applicable).


(Q)      "TRANSFER" has the meaning ascribed thereto in paragraph (a) of Section
         6.01 of this Lease.

(R)      "TRANSFEREE"  has the  meaning  ascribed  thereto in  paragraph  (a) of
         Section 6.01 of this Lease.

(S)      "YEAR" means each calendar year, the whole or part of which is included
         within the Term. (q)



<PAGE>

                                  SCHEDULE "C"

                        EXTERIOR MAINTENANCE/REPAIR WORK

<TABLE>
<CAPTION>
<S>                                 <C>
Building  Repairs - General         Minor  caulking,  clean-up and repairs of a general
nature.

Roof Repairs:                       Maintain and repair roof as required to keep the roof in a well-maintained condition.

Painting:                           Paint outside doors and frames, bollards, roof flashing and rooftop units as required.

Electrical Repairs:                 Maintain and repair outside lights, replace ballasts and lamps as required.

Paved Areas:                        Maintain and repair all asphalt and paved areas (including but not limited to pavement
                                    surface, curbs, sidewalks, catchbasins and concrete dolley pads).

Parking Lot Sweeping:               Sweep entire parking lot.

Parking Lot Striping:               Line paint parking areas.

Landscaping:                        Fertilizing,  weed  spraying,  lawn cutting,  till and edge all beds and tree pits,
                                    pruning all shrubs as  required,  spraying of insects on trees and shrubs.  Pruning
                                    and root feeding all trees and replacing dead plant material as required.

Lawn Sprinklers:                    Start-up and winterize irrigation system, replace sprinkler heads as required and maintain
                                    system.

Spring Clean-Up:                    General spring clean-up of debris accumulated over the winter months.

Window Cleaning:                    Clean exterior windows six (6) times per year
</TABLE>



<PAGE>

                                  SCHEDULE "D"

                                 LANDLORD'S WORK

The Landlord shall, at its own expense, provide the following work to the Leased
Premises prior to the Commencement  Date. Such work shall be completed in a good
and  workmanlike  manner,  subject  to delays by causes  beyond  the  Landlord's
reasonable control.

The Leased Premises will comprise  exterior  materials of architectural  precast
panels to the  office,  with  tinted  thermopane,  sealed  float  glass units in
colored  aluminum  frames.  The warehouse area will have insulated,  prefinished
metal panels.


<TABLE>
<CAPTION>
<S>                                          <C>
Heights                                      Nominally  10'-0" to the suspended  acoustic ceiling in the office area and
                                             30'-0" to the underside of the structural steel in the warehouse.

Office Area Finishes                         Suspended  T-bar  ceiling with 2'-0" x 4'-0"  acoustic  tile,  lay-in.  All
                                             interior  partitions  to  be  10'-0"  high.  Steel  stud  and  drywall,  2"
                                             fiberglass  sound  attenuation  batts between metal studs in the partitions
                                             designated as insulated.  Doors to be 3'-0" x 7'-0" in hollow metal frames,
                                             including hardware. Landlord to provide glass vestibule at main entrance to
                                             the office area.  Male/female  washrooms are provided within this space for
                                             the  office  area  and a  separate  set  of  washrooms  for  the  warehouse
                                             employees,  in accordance with a mutually agreed upon  partitioning  layout
                                             and local codes.  Landlord to provide  electric,  wiring to the office area
                                             with voice and data outlets / connection points at locations  designated by
                                             the Tenant.  Flooring and millwork for the office and washrooms  area to be
                                             installed by Tenant.

Lunchroom                                    To accommodate  twenty-five  (25) employees,  complete with counters by the
                                             Tenant, provision for a refrigerator, microwave, hot/cold running water and
                                             electrical for vending equipment as mutually agreed.

HVAC                                         Supply  all labor,  equipment,  and  materials  that are  required  for the
                                             complete  installation  and  testing of the new  heating,  ventilating  and
                                             air-conditioning  systems to the office.  Heating and  air-conditioning  by
                                             means of a  constant  volume  system.  Supply  and  install  heating to the
                                             warehouse area by means of gas-fired unit heaters, suspended from joists.

Electrical                                   Main  electrical  service to be 600 amps,  347/600V,  3 phase,  4 wire. The
                                             following  general  illumination is provided:  Office - 65 FC by commercial
                                             fluorescent  fixtures,  Warehouse  - 30 FC by metal  halide  HID  lighting,
                                             400-watt fixtures, one fixture per 550 s.f. of warehouse area.

Concrete Floors                              The floor slab to the office area,  to be four-inch  (4") concrete with one
                                             layer of  reinforcing  mesh,  finished  and  cured.  The floor  slab to the
                                             warehouse  area to be  seven-inch  (7") concrete  reinforced  with 25 kg/m3
                                             steel fibers  reinforcing.  Traprock floor hardener shall be applied at the
                                             rate of 60 lbs./100 sq. ft.  premixed.  No provision is made for pads, pits
                                             or bases.  Bay sizes to be 36'-0" X 45'-0".  Landlord  to  provide  Defined
                                             Traffic F min 40 floor  flatness  tolerance  to 22,680 s. f. of  contiguous
                                             warehouse space where designated by the Tenant.

Fire Protection                              Landlord  to supply and  install a standard  wet-type  sprinkler  system to
                                             light hazard requirements in the office.  Landlord to supply and install an
                                             E.S.F.R. sprinkler system in the warehouse.

Overhead                                     Doors  Supply and install  fourteen  (14) 8'-0" X 10'-0"  insulated  metal,
                                             manually  operated  overhead  doors at shipping and  receiving  area,  each
                                             complete with door seal,  rubber bumpers,  and 35,000 lb. manually operated
                                             dock leveler.  Supply and install one (1) 12'-0" X 10'-0"  insulated metal,
                                             electrically  operated  overhead doors with four (4) steel pipe  protection
                                             bollards.

Exterior                                     Landscaping  and  sodding  provided  for entire  site,  with  asphalt-paved
                                             driveways and parking areas.  Landlord to provide chain-link fenced-in area
                                             for truck/trailer parking adjacent to shipping/receiving area.
</TABLE>



<PAGE>

                                                         Page #2 of Schedule "D"

<TABLE>
<CAPTION>
<S>                                          <C>
Items Not Included                           The following items have not been included:  Winter  construction  charges,
                                             other floor loadings or finishes, garbage protecting equipment,  furniture,
                                             signs, security or other alarm systems,  computer rooms, process electrical
                                             or mechanical,  task lighting,  additional lighting to suit racking layout,
                                             cooling to the production  area,  painting  structural steel or deck, truck
                                             restraints,  canopy  over truck  area,  pit for scale,  flammable/hazardous
                                             material  storage room,  process drains and  interceptors,  carousels,  and
                                             G.S.T.
</TABLE>


<PAGE>


                               INDEMNITY AGREEMENT

         THIS AGREEMENT is dated the 12th day of August, 2003


B E T W E E N:

                               ORLANDO CORPORATION
                       (hereinafter called the "LANDLORD")

                               OF THE FIRST PART;


                                     - and -

                    THE CHILDREN'S PLACE RETAIL STORES, INC.
                     (hereinafter called the "INDEMNIFIER")

                               OF THE SECOND PART;


IN ORDER TO induce the  Landlord  to enter into the Lease  dated the 12th day of
August , 2003 between Orlando Corporation (as Landlord) and The Children's Place
(Canada),  LP (the "Tenant") by TCP Investment Canada II Corp.,  General Partner
regarding  the property  municipally  known as 6040 Cantay Road,  in the City of
Mississauga,  Province of Ontario (the "Lease") and more particularly  described
therein, and other good and valuable  consideration (the receipt and sufficiency
of which consideration is hereby  acknowledged) the Indemnifier hereby makes the
following  Indemnity and agreement (the  "Indemnity")  with and in favour of the
Landlord:

1.        The Indemnifier shall at all times, perform and observe all covenants,
          provisoes,  conditions  and agreements on the part of the Tenant to be
          performed or observed under the Lease including but not limited to the
          payment of Rent and all other  amounts from time to time payable under
          the Lease.

2.        The Indemnifier  shall indemnify the Landlord with respect to all loss
          to and damage that may be suffered by the Landlord in  consequence  of
          any default by the Tenant in the performance  and/or observance of all
          of the Tenant's obligations and covenants under the Lease.

3.        The Indemnifier's  obligation  pursuant to this Indemnity is that of a
          principal  obligor  and  not  a  mere  guarantor  or  surety  and  the
          Indemnifier  shall be jointly and  severally  bound with the Tenant to
          the  Landlord  for  the  due   performance  of  all  of  the  Tenant's
          obligations under the Lease

4.       If any default shall be made by the Tenant in the performance of any of
         its  obligations  under the Lease,  the Landlord  shall not be bound or
         required to proceed against the Tenant or any other obligated person or
         to have  recourse to or exhaust any security  from time to time held by
         it for the performance of such obligation or to pursue any other remedy
         whatsoever which may be available to it, before proceeding  against the
         Indemnifier.

5.       The obligations of the Indemnifier under this Indemnity shall in no way
         be released, discharged or reduced and the rights of the Landlord under
         this  Indemnity  shall  in no  way be  prejudiced  or  impaired  by any
         neglect,  delay or forbearance of the Landlord in demanding,  requiring
         or enforcing  performance by the Tenant of any of its obligations under
         the Lease or by the  Indemnifier of any of its  obligations  under this
         Indemnity or by granting any  extensions of time for  performance or by
         waiving any performance  (except as to a particular  performance  which
         has been expressly  waived in writing by the Landlord) or by permitting
         or consenting to any assignment or subletting  referred to in the Lease
         or by the  dissolution  of the Tenant or any other event or  occurrence
         which  would have the effect in law of  terminating  the  existence  or
         obligations  of the Tenant prior to the  expiration  of the term of the
         Lease  (except  by  the  voluntary  acceptance  by  the  Landlord  of a
         surrender of the Lease) or by any agreements or other dealings  between
         the Landlord  and the Tenant  having the effect of amending or altering
         the Lease or the obligations of the Tenant thereunder or by any want of
         notice by the Landlord to the  Indemnifier of any default of the Tenant
         or by any  other  matter,  thing,  act  or  omission  of  the  Landlord
         whatsoever.



                                      -2-

<PAGE>

6.       Without limiting the generality of the foregoing,  the liability of the
         Indemnifier  under this Indemnity  shall not be (and shall be deemed to
         not have been) waived,  released,  discharged,  impaired or affected by
         reason of the release or discharge  of the Tenant in any  receivership,
         bankruptcy,   winding-up  or  other   creditors'   proceedings  or  the
         repudiation, rejection, disaffirmance or disclaimer of the Lease in any
         proceeding  including,  without  limitation,  any proceeding  under the
         Bankruptcy  and Insolvency Act (Canada) and shall continue with respect
         to the periods prior thereto,  thereunder and thereafter,  for and with
         respect  to the  Term as if the  Lease  had  not  been  disaffirmed  or
         disclaimed.

7.       The  obligations of the  Indemnifier  pursuant to this Indemnity  shall
         extend to the Term of the Lease and to any  overholding  by the  Tenant
         thereafter  and to any  renewal or  extension  of the Term of the Lease
         which  results  from the  exercise by the Tenant of any right or option
         contained in the Lease.

8.       The Indemnifier shall only be released by payment in full of all monies
         that the Landlord  would have  received  pursuant to the Lease,  if the
         Lease had continued  throughout the Term thereof unless the Lease shall
         have been terminated by the Landlord for any reason other than an Event
         of  Default  occurring  under  the  Lease or the  Landlord  shall  have
         voluntarily  accepted a  surrender  of the Lease.  Notwithstanding  the
         foregoing,  the  Landlord  agrees that  following  receipt of a written
         request   accompanied  by  the  Tenant's   current  audited   financial
         statements,  it will fully release the Indemnifier from its obligations
         hereunder  should  the  Landlord  be  satisfied  on the  basis  of such
         financial statements (and such other financial  information and records
         as the Landlord may reasonably  require) that the tangible net worth of
         The  Children's  Place  (Canada),  LP exceeds  ($Cdn.)  Twenty  Million
         ($20,000,000.00)  Dollars.  For the purpose of determining whether such
         threshold  has been met,  tangible  net worth shall be deemed to be the
         amount  of the  limited  partnership's  total  assets  in excess of the
         amount of its total liabilities, less its goodwill and other intangible
         assets;  and any such release,  in order to be  effective,  shall be in
         writing signed by the Landlord.


9.       This  Indemnity  shall be governed by and construed in accordance  with
         the laws of the Province of Ontario.

10.      The Indemnifier  shall submit to the jurisdiction of the governing laws
         of the Lease and any action or  proceedings  brought by the Landlord to
         enforce its rights pursuant to this Indemnity.

11.      Any notice, request, demand or other writing pursuant to this Indemnity
         shall  be  sufficiently  given  if  delivered  by hand  and left at the
         recipient's  address,  or  transmitted  by  telecopier,   addressed  as
         follows:

         In the case of notice to the Landlord to:

         Orlando Corporation
         5th Floor
         6205 Airport Road
         Mississauga, Ontario
         L4V 1E3

         Attention:        President

         Facsimile No:     (905) 677-2824

         And in the case of notice to the Indemnifier to:

         The Children's Place Retail Stores, Inc.
         915 Secaucus Road
         Secaucus, NJ 07094

         Attention:        Vice President, Real Estate

         Facsimile No:     (201) 558-2832

         With a copy to the General Counsel

         Facsimile No:     (201) 558-2840





                                      -3-
<PAGE>

         Either the Landlord or the  Indemnifier may from time to time by notice
         given in accordance  with the  provisions  of this Section,  change its
         address or other details  pertaining to such address set out above, and
         from and after the date, such notice is deemed to have been received as
         hereinafter  provided,  the  address  or other  details  set out  above
         pertaining  to the party giving such notice shall be deemed  amended in
         accordance with such notice.

         Any notice given as aforesaid and delivered by hand or facsimile  shall
         be deemed to have been received on the date of delivery or transmission
         as the case may be.

12.      The expressions "Event of Default",  "Landlord",  "Tenant",  "Term" and
         "Rent" and other  terms or  expressions  where used in this  Indemnity,
         respectively, have the same meaning as in the Lease.

13.      The Indemnifier hereby acknowledges  receipt of an executed copy of the
         Lease and this Indemnity.

14.      Wherever in this Indemnity  reference is made to either the Landlord or
         the Tenant,  the  reference  is deemed to apply also to the  respective
         heirs, executors, administrators,  successors and assigns and permitted
         assigns,  respectively, of the Landlord and the Tenant, as the case may
         be, named in the Lease.  Any  assignment  by the Landlord of any of its
         interest in the Lease operates  automatically  as an assignment to such
         assignee of the benefit of this Indemnity.


                  IN WITNESS  WHEREOF  the  Landlord  and the  Indemnifier  have
signed this Indemnity.



LANDLORD:                       ORLANDO CORPORATION


                                Per:    /s/  Doug Kilner
                                    -------------------------------
                                Name:  Doug Kilner
                                Title:    President

                                Per:    /s/  William O'Rourke

                                Name: William O'Rourke
                                Title:   SVP, Finance

                                We have the Authority to Bind the Corporation


INDEMNIFIER:                    THE CHILDREN'S PLACE RETAIL STORES, INC.


                                Per:    /s/  Mark Rose
                                    -------------------------------
                                Name:  Mark Rose
                                Title:    Vice President

                                Per:    /s/  Susan Schiller
                                    ----------------------------------------
                                Name:  Susan Schiller
                                Title:    Vice President

                                I/We have the Authority to Bind the Corporation





<PAGE>

                               SURRENDER OF LEASE

         THIS AGREEMENT dated of the 12th day of August, 2003


B E T W E E N:

                            ORLANDO CORPORATION, AND
                              ORION PROPERTIES LTD.
                       (hereinafter called the "Landlord")

                                OF THE FIRST PART

                                     - and -

                        THE CHILDREN'S PLACE (CANADA), LP
               BY TCP INVESTMENT CANADA II CORP., GENERAL PARTNER
                              (hereinafter called the "Tenant")

                               OF THE SECOND PART


         WHEREAS:

         (a)      By a lease  dated the 21st day of  August,  2000  between  the
                  Landlord and HMV Canada Inc.  (herein  "HMV"),  as tenant (the
                  "Lease"),  the  Landlord  did demise and lease unto HMV, for a
                  term of five (5) years  commencing  on the 1st day of October,
                  2000  and  ending  on the  30th day of  September,  2005  (the
                  "Term"),  the premises  municipally  known as 6291 Ordan Drive
                  and  being  more  particularly  described  in the  Lease  (the
                  "Leased Premises");

         (b)      Pursuant   to  an   assignment   dated  April  10,  2002  (the
                  "Assignment"),  HMV assigned the Lease to the Tenant effective
                  the 15th day of May, 2002;

         (c)      By a consent to assignment  dated the 5th day of April,  2002,
                  the Landlord gave its consent to the Assignment; and

         (c)      The Tenant and Landlord  have entered into a lease dated as of
                  August 12, 2003 (the "New  Lease") in respect of the  premises
                  municipally  known as 6040 Cantay  Road,  Mississauga  and the
                  Tenant has agreed to surrender the Lease and vacate the Leased
                  Premises as of the day before the commencement date of the New
                  Lease (the "Surrender Date").

                  NOW THEREFORE THIS AGREEMENT WITNESSETH that, in consideration
of the covenants herein contained and other good and valuable consideration (the
receipt and adequacy of which is hereby acknowledged), the parties hereto hereby
agree as follows:

1. The Tenant hereby  assigns,  surrenders and yields up unto the Landlord,  its
successors  and assigns,  the Lease and the Leased  Premises  and the  unexpired
residue of the Term subsequent to the Surrender Date to the intent that the Term
subsequent to the  Surrender  Date and all estate and right of the Tenant in the
Leased   Premises   subsequent  to  the  Surrender  Date  shall  be  merged  and
extinguished in the reversion expectant thereon, and covenants with the Landlord
that it has the right,  full power and absolute  authority to assign,  surrender
and yield up the Lease and the Leased Premises.

3. The Tenant releases the Landlord from any and all liability  arising under or
by virtue of the Lease other than liability which the Lease  expressly  provides
will continue after any termination of the Lease.

4. Provided that: (a) the Tenant has paid to the Landlord the Rent and all other
amounts  owing  and/or  are  payable  by the  Tenant  under  the Lease up to and
including the Surrender  Date; (b) the Tenant has  performed,  complied with and
satisfied  all of the Tenant's  covenants,  obligations  and  liabilities  under
and/or in respect of the Lease up to and including the Surrender  Date;  and (c)
the Tenant  surrenders to the Landlord vacant  possession of the Leased Premises
in  accordance  with the  provisions of the Lease by no later than the Surrender
Date, then the Landlord  releases the Tenant from liability  arising or accruing
under the Lease  subsequent to the Surrender Date provided that the Tenant shall
not be released with respect to any  environmental  contamination  of the Leased
Premises that may accrue or arise prior to the  Surrender  Date or any liability
of the  Tenant  which the  Lease  expressly  provides  will  continue  after any
termination of the Lease.

5. The within surrender and the Tenant's within release shall be effective as of
the Surrender Date.

6. This Agreement shall enure to the benefit of and be binding upon the parties
hereto and their respective successors and assigns.




                                       -2-
<PAGE>

         IN WITNESS WHEREOF the parties hereto have executed this Agreement


LANDLORD:                            ORLANDO CORPORATION

                                     Per:    /s/  Doug Kilner
                                         ---------------------------------------
                                            Authorized signing officer
                                     Name:  Doug Kilner
                                     Title: President


                                     Per:   /s/  William O'Rourke
                                         ---------------------------------------
                                            Authorized signing officer
                                     Name:  William O'Rourke
                                     Title: SVP, Finance

                                     We Have Authority to Bind The Corporation


LANDLORD:                            ORION PROPERTIES LTD., (BY ITS AUTHORIZED
                                     PROPERTY MANAGER ORLANDO CORPORATION

                                     Per:    /s/  Doug Kilner
                                         ---------------------------------------
                                            Authorized signing officer
                                     Name:  Doug Kilner
                                     Title: Authorized Signing Officer


                                     Per:   /s/  William O'Rourke
                                         ---------------------------------------
                                            Authorized signing officer
                                     Name:  William O'Rourke
                                     Title: Authorized Signing Officer

                                     We Have Authority to Bind The Corporation


TENANT:                              THE CHILDREN'S PLACE (CANADA), LP

                                     BY TCP INVESTMENT CANADA II CORP.,
                                        GENERAL PARTNER


                                     Per:   /s/  Mark Rose
                                         ---------------------------------------
                                            Authorized signing officer
                                     Name:  Mark Rose
                                     Title: Vice President


                                     Per:   /s/  Susan Schiller
                                         ---------------------------------------
                                            Authorized signing officer
                                     Name:  Susan Schiller
                                     Title: Vice President

                                     I/We Have Authority to Bind The Corporation





</TEXT>
</DOCUMENT>
