RALEIGH, N.C. (AP) _ Raleigh would offer the Hartford Whalers a lease on a $120 million arena, set to open in 1999, if they end their agreement in Connecticut and find a temporary home.

``There are a lot of balls in the air right now,'' said Steve Stroud, chairman of Raleigh's Centennial Authority, which discussed the lease for two hours behind closed doors Monday.

``We hope they all land in our favor.''

Whalers owner Peter Karmanos wants to move the team from Hartford to Raleigh or Columbus, Ohio, but Raleigh has emerged as the clear favorite. He was expected to announce his choice this week.

Whalers officials neared a two-year lease agreement Monday to play at Greensboro Coliseum until the Raleigh arena is completed in 1999.

Fayetteville's Cumberland County Crown Coliseum was under consideration last week, but concern about its 13,500 seating capacity shifted the spotlight back to 21,500-capacity Greensboro Coliseum.

Stroud said the Centennial Authority has not drafted a lease yet for the Whalers in Raleigh because of uncertainty over the team's Hartford lease and its interim playing site.

``Once those issues are resolved, we're in a position to reach a lease agreement quickly,'' Stroud said.

The authority planned to meet again Tuesday.

The Connecticut Development Authority said the Whalers must pay the state $20 million to end their lease agreement a year earlier than scheduled. If the Whalers stayed in Hartford another season, they would have to pay only $5 million to leave. State House Speaker Thomas Ritter has proposed boosting the early exit fee to $40 million.

Stroud said he was anxious about the exit fee demanded by Connecticut because he said Karmanos probably would stay in Hartford rather than pay a $40 million fee. But he added, ``Mr. Karmanos has operated in good faith with us, and we're confident.''

He said Whalers and Greensboro officials were making good progress toward an agreement allowing the team to play at Greensboro Coliseum through the 1998-99 season.

Whalers general manager Jim Rutherford also said the team was close to reaching a lease agreement at Greensboro. He said the major remaining issue was what to do with the Carolina Monarchs of the American Hockey League, who now play there.

Howard Williams, a Monarchs owner who is handling the club's negotiations with the Whalers, said the current coliseum lease entitles the Monarchs to ``reasonable'' compensation if forced out by the Whalers.

Options for the Monarchs would be to sell the team to Karmanos, suspend operations for two seasons, or move to another city for two seasons, then return to Greensboro.

The Monarchs have said they were interested only in selling the team to Karmanos, but Rutherford has said the Whalers are not interested in owning a minor league team.

Williams said another plan surfaced in discussions with Rutherford.

Raleigh's current minor-league team, the IceCaps of the East Coast Hockey League, might want to leave the market as soon as possible if the Whalers move to Raleigh. The Monarchs then could move to Raleigh for two years and return to Greensboro when the Whalers move to Raleigh in 1999, Williams said.