LEASE

THIS LEASE, made and entered into this 28th day of January, 1996 by and between DENNIS R. WASHINGTON, d/b/a WESTERN TRADE CENTER, of Missoula, Montana, hereinafter referred to as "Lessor", and ULTRAFEM, INC., of Missoula, Montana, hereinafter referred to as "Lessee" whether one or more.

RECITALS:

Lessor owns real property in Missoula, Montana, more particularly located at 1600 North Avenue West and as and comprising approximately 24,000 square feet as depicted on Exhibit "A" attached hereto and hereinafter referred to as Premises.

Lessor is desirous of leasing such Premises to Lessee, who is desirous of leasing the commercial premises pursuant to the negotiated terms of this agreement.

NOW, THEREFORE, in consideration of the foregoing recitals and the premises and payment hereinafter provided, Lessor hereby leases to Lessee that commercial space referenced in recital A and Lessee hereby leases from Lessor said Premises pursuant to the following terms, conditions and covenants.

1. TERM. The parties hereto agree that the term of this Lease shall be for a period of three years commencing February 1, 1996 and ending January 31, 1999, at that monthly rental amount hereinafter specified.

2. RENT. Lessee hereby covenants and agrees to pay Lessor, Western Trade Center, Missoula, Montana, or such other person, firm or corporation, or at such other place as Lessor from time to time may designate in writing a monthly rental of Six Thousand Five Hundred Dollars ($6,500.00) which shall be payable in advance on the first day of each and every month during the term of this Lease. Rent for any partial calendar month during the term hereof shall be prorated at the rate for such month, and shall be due and payable on the first day of such month.

Lessor agrees to pay for the cost of heat.

Lessee agrees to pay for all lights and electricity.

3. ACCEPTANCE OF THE PREMISES. Except with respect to the act of negligence or intentional misconduct of Lessor, Lessor shall not be responsible nor have any liability whatsoever at any time for loss or damage to Lessee's fixtures, equipment or other property of Lessee installed or placed by Lessee on the Premises. By occupying the Premises, Lessee shall be deemed conclusively to have accepted the same and to have acknowledged that the Premises are in good and tenantable condition. Except as set forth in this Lease, no representations have been made to Lessee by Lessor, or its agents, with respect to the Premises or their fitness or suitability for Lessee's use.

4. MAINTENANCE AND REPAIRS. Lessor shall keep the foundation, the outer walls, gutters, down spouts and roof of the Premises in good repair; provided that Lessor shall not be obligated to make any repairs occasioned by the act or negligence of Lessee, its employees, agents, servants, customers and other invitees; and provided further that Lessor shall have no obligation to paint, recover or refurbish exterior walls or the interior surfaces of the walls. During the term hereof, at its sole cost and expense, Lessee shall keep all parts of the interior of the Premises, including without limitations, the doors, interior walls in good order, operating condition and repair. Lessee shall also keep the Premises in a clean, sanitary and safe condition in accordance with all directions, rules and regulations of any health officers, building inspectors or other proper officers of the governmental agencies having jurisdiction and shall dispose of all trash and waste materials in the outside trash containers to be provided by Lessee for this purpose. Lessee shall comply with all requirements of law, ordinances and other rules and regulations that affect the Premises. Lessee shall permit no injury to the Premises or the improvements of which they are a part, and Lessee shall, at its own cost and expense, replace any light bulbs, frames and accessory parts thereof on the Premises that may expire, be broken or damaged during the term hereof. At the expiration of the term, Lessee shall surrender the Premises broom clean and in as good order as the same are on the Lease Commencement Date, reasonable wear and tear, excepted.

5. TAXES. Lessor specifically agrees to pay all real property taxes assessed against the subject property and to carry sufficient structural insurance.

6. INSURANCE. During the term hereof, Lessee shall, at its sole cost and expense, maintain the following insurance with respect to the Premises: (a) standard fire and extended coverage insurance insuring all of its fixtures, furniture and equipment for the full replacement value thereof; and (b) public liability insurance with limits of not less than One Million Dollars ($1,000,000) per person bodily injury, One Million Dollars ($1,000,000) per occurrence bodily injury, and One Hundred Thousand Dollars ($100,000) for property damage per occurrence, or a combined single limit of liability of Five Hundred Thousand Dollars ($500,000), insuring against claims of any and all personal injury, death or damage occurring in or about the Premises or the sidewalks adjacent thereto. Each such insurance policy shall be issued by an insurance company of recognized standing, authorized to do business in the State of Montana and reasonably satisfactory to Lessor. The policies required in the above paragraph shall name Lessor as an additional insured and where applicable be payable to Lessor and Lessee as their interest may appear. If required by Lessor, such policies shall also contain a loss payable endorsement in favor of the holder of any mortgage affecting the Premises. All such policies shall provide that no cancellation or termination thereof or any material modification thereof shall be effective except on ten (10) days' prior written notice to Lessor, and, if applicable, said mortgagee. From time to time during the term hereof, Lessee will provide to Lessor current certificates of insurance evidencing Lessee's compliance with the terms of this section.

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