Exhibit
      10.40


LOAN AND SECURITY
AGREEMENT





THIS LOAN AND SECURITY
AGREEMENT (the “Agreement”) is dated as of
this 9th day of July, 2009, by and between GRIFFIN LAND & NURSERIES,
INC., a Delaware corporation, with a principal place of business 204 West
Newberry Road, Bloomfield, Connecticut 06002-1308 (the “Borrower”) and PEOPLE’S UNITED BANK, a
federal savings bank having an office at One Financial Plaza, Hartford,
Connecticut 06103 (the “Lender”).


STATEMENT OF
PURPOSE


WHEREAS,the Borrower has
requested that the Lender make a mortgage loan in the principal amount of up to
Ten Million Five Hundred Thousand and 00/100 Dollars ($10,500,000.00) (the
“Loan”) to be secured by
the real property owned by Borrower and commonly known as 14 International
Drive, 15 International Drive and 16 International Drive, East Granby,
Connecticut and 40 International Drive, Windsor, Connecticut (collectively, the
“Property”);
and
 
 WHEREAS,the Lender has agreed
to make the Loan and the Borrower desires to enter into the Loan, all upon the
terms and conditions set forth in this Agreement;
 
 NOW, THEREFORE, for good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged by the parties hereto, and intending to be legally bound hereby,
such parties hereby agree as follows:


ARTICLE
I




DEFINITIONS




Section
1.01.          Definitions.  The
following terms when used in this Agreement shall have the meanings assigned to
them below:





“Affiliate” means, with respect
to any Person, any other Person (other than a Subsidiary) which directly or
indirectly through one or more intermediaries, controls, or is controlled by, or
is under common control with, such first Person or any Subsidiary
thereof.  The term control means (a) the power to vote ten percent
(10%) or more of the Capital Securities of a Person having ordinary voting
power, or (b) the possession, directly or indirectly, of any other power to
direct or cause the direction of the management and policies of a Person,
whether through ownership of voting Capital Securities, by contract or
otherwise.  Notwithstanding the foregoing, (a) no individual shall be
an Affiliate of a Person solely by reason of his or her being a director,
officer or employee of such Person and (b) the Lender shall not be an Affiliate
of Borrower.





“Agreement” shall mean this
Loan and Security Agreement, as it may be amended or modified from time to
time.





“Anti-Terrorism Laws” shall
have the meaning set forth in Section
5.01(w).





“Applicable Law” means all
applicable provisions of constitutions, laws, statutes, ordinances, rules,
treaties, regulations, permits, licenses, approvals, interpretations and orders
of courts or Governmental Authorities and all orders and decrees of all courts
and arbitrators.
  “Borrower” shall mean Griffin
Land & Nurseries, Inc., a Delaware corporation.





“Borrower’s Knowledge” or words
of similar import used in this Agreement shall mean solely the actual knowledge
of (i) Frederick M. Danziger, President of the Borrower; (ii) Anthony J. Galici,
Vice President, Secretary and Chief Financial Officer of the Borroweror (iii) Thomas M.
Lescalleet, Senior Vice President of Griffin Land, a division of the Borrower,
who have been active in the management of the Property and the Borrower, without
any duty of inquiry or investigation of any type.




“Business Day”
means:


(a)           any
day which is neither a Saturday or Sunday nor a legal holiday on which
commercial banks are authorized or required to be closed in Bridgeport,
Connecticut;




(b)  when such
term is used to describe a day on which a payment or prepayment is to be made in
respect of a LIBOR Rate Loan, any day which is: (i) neither a Saturday or Sunday
nor a legal holiday on which commercial banks are authorized or required to be
closed in New York City; and (ii) a LIBOR Business Day; and





(c)           when
such term is used to describe a day on which an interest rate determination is
to be made in respect of a LIBOR Rate Loan, any day which is a LIBOR Business
Day.





“Capital Lease” means, with
respect to Borrower, any lease of any property that should, in accordance with
GAAP, be classified and accounted for as a capital lease on a balance sheet of
Borrower.





“Capital Securities” means,
with respect to any Person, any and all shares, interests (including partnership
interests or limited liability company interests), participations or other
equivalents (however designated, whether voting or non-voting) of such Person’s
capital, whether now outstanding or issued hereafter.





“Closing” means the advance of
the Initial Tranche.





“Closing Date” means the date
of this Agreement.





“Code” means the Internal
Revenue Code of 1986, and the rules and regulations thereunder, each as amended,
supplemented or otherwise modified from time to time.






2








“Collateral” means,
collectively, all estate, right, title and interest which the Borrower now has
or may later acquire in and to (i) the “Premises” as defined in the Mortgage,
(ii) the “Leases” and “Rents” as defined in the Collateral Assignment, as well
as all other collateral now and hereafter granted to the Lender as security for
the Obligations; and (iii) the UCC Collateral (as defined in Section 4.01
herein).




“Collateral Assignment” means
the Assignment of Leases and Rentals dated the date hereof from the Borrower to
Lender.





“Debt” means, with respect to
any Person at any date and without duplication, the sum of the following
calculated in accordance with GAAP:  (a) all indebtedness for borrowed
money and all obligations evidenced by bonds, debentures, notes or other similar
instruments of any such Person; (b) all obligations of such Person to pay the
deferred purchase price of property or services, except trade accounts payable
arising and paid in the ordinary course of business and accrued expenses
incurred in the ordinary course of business;(c) all obligations of
any such Person as lessee under Capital Leases; (d) all debt secured by any Lien
upon property or assets owned by such Person, notwithstanding that such Person
has not assumed or become liable for the payment of such debt; (e) all Guaranty
Obligations of any such Person; (f) all obligations, contingent or otherwise, of
any such Person relative to the face amount of letters of credit, whether or not
drawn, including any reimbursement obligation, and banker’s acceptances issued
for the account of any such Person; (g) all obligations of such Person with
respect to all Capital Securities of such Person subject to repurchase or
redemption otherwise than at the sole option of such Person (provided, that, if the
documents governing such repurchase or redemption obligation do not require such
repurchase or redemption if the same would violate the provisions of this
Agreement, only to the extent such repurchases or redemptions are permitted to
be paid under the terms of this Agreement), but only to the extent such
obligations are no longer contingent; and (h) all obligations incurred by any
such Person pursuant to the Interest Rate Protection Agreement.





“Debtor Relief Laws” means the
United States Bankruptcy Code, Title 11 of the United States Code, 11 U.S.C.
§101 et seq., as amended from time to time, or any successor statute, and all
other applicable liquidation, conservatorship, bankruptcy, moratorium,
rearrangement, receivership, insolvency, reorganization, winding up or similar
debtor relief laws, whether federal, state, local or foreign from time to time
in effect affecting the rights of creditors generally.





“Default” means any of the
events specified in Section 10.01 which
with the passage of time, the giving of notice or the satisfaction of any other
condition, would constitute an Event of Default.





“Default Rate” has the meaning
ascribed to it in each Note.





“Dollars or $” means, unless
otherwise qualified, dollars in lawful currency of the United
States.






3





“Environmental Laws” means any
and all federal, state and local laws, statutes, ordinances, rules, regulations,
permits, licenses, approvals and orders of courts or Governmental Authorities,
relating to the protection of human health or the environment, including
requirements pertaining to the manufacture, processing, distribution, use,
treatment, storage, disposal, transportation, handling, reporting, licensing,
permitting, investigation or remediation of Hazardous Materials, including but
not limited to the Comprehensive Environmental Response, Compensation and
Liability Act.





“ERISA” means the Employee
Retirement Income Security Act of 1974, and the rules and regulations
thereunder, each as amended, supplemented or otherwise modified from time to
time.





“ERISA Affiliate” means any
Person who together with the Borrower is treated as a single employer within the
meaning of Section 414(b), (c), (m) or (o) of the Code or Section 4001(b) of
ERISA.





“Event of Default” means any of
the events specified in Section 10.01,
provided that any requirement for passage of time, giving of notice, or any
other condition, has been satisfied.





“Executive Order” has the
meaning assigned thereto in Section 5.01(w) hereof.





“Federal Reserve Board” means
the Board of Governors of the Federal Reserve System, or any successor
thereto.





“Fiscal Year” means the fiscal
year of Borrower ending on the Saturday occurring nearest November
30.





“GAAP” means generally accepted
accounting principles, as recognized by the American Institute of Certified
Public Accountants and the Financial Accounting Standards Board, consistently
applied and maintained on a consistent basis throughout the period
indicated.





“Governmental Approvals” means
all authorizations, consents, permits, approvals, licenses, exemptions and other
qualifications of, registrations and filings with, and reports to, all
Governmental Authorities.





“Governmental Authority” means
any nation, province, state or political subdivision thereof, federal, state or
local, and any government or any Person exercising executive, legislative,
regulatory or administrative functions of or pertaining to government, and any
corporation or other entity owned or controlled, through stock or capital
ownership or otherwise, by any of the foregoing.





“Guaranty Obligation” means,
with respect to any Person, without duplication, any obligation, contingent or
otherwise, of any such Person pursuant to which such Person has directly or
indirectly guaranteed any Debt or other obligation of any other Person and,






4






without
limiting the generality of the foregoing, any obligation, direct or indirect,
contingent or otherwise, of any such Person: (a) to purchase or pay (or advance
or supply funds for the purchase or payment of) such Debt or other obligation
(whether arising by virtue of partnership arrangements, by agreement to keep
well, to purchase assets, goods, securities or services, to take-or-pay, or to
maintain financial statement condition or otherwise) or (b) entered into for the
purpose of assuring in any other manner the obligee of such Debt or other
obligation of the payment thereof or to protect such obligee against loss in
respect thereof (in whole or in part); provided, that the
term Guaranty Obligation shall not include endorsements for collection or
deposit in the ordinary course of business.





“Hazardous Materials” means any
substances or materials (a) which are or become defined as hazardous wastes,
hazardous substances, pollutants, contaminants, chemical substances or mixtures
or toxic substances under any Environmental Law, (b) which are toxic, explosive,
corrosive, flammable, infectious, radioactive, carcinogenic, mutagenic or
otherwise harmful to human health or the environment and are or become regulated
by any Governmental Authority, (c) the presence of which require investigation
or remediation under any Environmental Law, (d) the discharge or emission or
release of which requires a permit or license under any Environmental Law or
other Governmental Approval or (e) which contain, without limitation, asbestos,
polychlorinated biphenyls, urea formaldehyde foam insulation, petroleum
hydrocarbons, petroleum derived substances or waste, crude oil, nuclear fuel,
natural gas or synthetic gas in amounts in excess of those permitted by
applicable Environmental Laws.





“Interest Rate Protection
Agreement” shall have the meaning assigned thereto in Section
3.09.





“Leasing Costs” shall mean (1)
the costs reasonably incurred by the Borrower to perform, or cause to be
performed, tenant improvements required under any new or renewed lease of all or
any portion of the Property, which new or renewed lease was permitted pursuant
to, or otherwise approved by the Lender in accordance with, the Collateral
Assignment; and (2) the costs of leasing commissions incurred by Borrower in
connection with the leasing of the Property or any portion thereof, provided
that (x) such leasing commissions are reasonable and customary for properties
similar to the Property and the portion of the Property leased for which such
leasing commission is due, and (y) the amounts of such leasing commissions are
determined pursuant to arm’s length transactions between Borrower and any
leasing agent to which a leasing commission is due, and excluding any leasing
commissions which shall be due any director, officer or shareholder of Borrower
or any Affiliate of Borrower.





“Lender” shall mean People’s
United Bank, a federal savings bank, its successors and assigns.





“Lender’s Office” means, with
respect to the Lender, the office of the Lender referenced in preamble of this
Agreement.


“LIBOR Business Day” shall have
the meaning ascribed to it in the Note.






5





“LIBOR Rate Loan” means the
Loan while such Loan is bearing interest at a rate based upon the LIBOR Rate (as
defined in the Note).





“Lien” means any lien
(statutory or other), mortgage, pledge, hypothecation, assignment, deposit
arrangement, security interest, charge or other encumbrance of any kind
including any conditional sale or other title retention agreement, and any lease
in the nature thereof.  For purposes of this Agreement, a Person shall
be deemed to own subject to a Lien any asset which it has acquired or holds
subject to the interest of a vendor or lessor under any conditional sale
agreement, Capital Lease or other title retention agreement relating to such
asset.





“Loan Document” means,
individually, and “Loan
Documents” means, collectively, this Agreement, the Note, the Interest
Rate Protection Agreement, the Security Documents and each other document,
instrument, certificate and agreement executed and delivered by the Borrower in
connection with the above or otherwise referred to herein or contemplated
hereby, all as may be amended, restated or otherwise modified.





“Material Adverse Effect” means
a material adverse effect (i) on the financial condition of Borrower, or (ii) on
the ability of Borrower to perform its material obligations under any Loan
Document to which it is a party.





“Mortgage” means the Open-End
Mortgage Deed and Security Agreement dated the date hereof from the Borrower to
the Lender pursuant to which Borrower grants to the Lender a lien in all the
Property, in form and substance acceptable to the Lender, as it may be amended
or modified from time to time, to secure the Note and the Interest Rate
Protection Agreement.





“Obligations” means, in each
case, whether now in existence or hereafter arising: (a) the principal of and
interest on the Loan, (b) all obligations owing by Borrower under the Interest
Rate Protection Agreement and (c) all other fees and commissions (including
attorneys’ fees), obligations, covenants and duties owing by Borrower to the
Lender arising pursuant to this Agreement, the Note or any of the other Loan
Documents, and including any such obligations incurred after the commencement of
any proceeding under any Debtor Relief Law (including any interest accruing
under any Loan Document after the filing of a petition with respect to the
Borrower under any Debtor Relief Law whether or not allowed or allowable as a
claim in the related proceeding).





“Operating Account” means commercial
checking account to be established in the name of the Borrower at the Lender and
which shall be identified as the “Operating Account” hereunder when its opened
by an amendment to this Agreement signed by both the Borrower and the
Lender.





“Permitted Liens” shall have
the meaning assigned thereto in Section
9.03.





6
 
  
 “Person” means an individual,
corporation, limited liability company, partnership, association, trust,
business trust, joint venture, joint stock company, pool, syndicate, sole
proprietorship, unincorporated organization, Governmental Authority or any other
form of entity or group thereof.





“Prime Rate” means the interest
rate from time to time announced by the Lender at its principal office as being
its “Prime Rate” for commercial borrowings of this type, which rate may not
necessarily be the Lender’s lowest or best rate.  The Prime Rate may
be determined and re-determined on a daily basis and each change in the Prime
Rate shall be effective on and following the date of such change without notice
or demand to the Borrower.





“Prime Rate Loan” means the
Loan while such Loan is bearing interest at a rate based upon the Prime
Rate.





“Property” collectively means
those certain pieces or parcels of real property owned by Borrower and commonly
known as 14 International Drive, 15 International Drive and 16 International
Drive, East Granby, Connecticut and 40 International Drive, Windsor,
Connecticut, together with all improvements thereon and appurtenances thereto,
all being more particularly described in the Mortgage encumbering said
Property.





“Responsible Officer” means any
of the following: the chief executive officer, chief financial
officer, president, vice president or any other officer reasonably
acceptable to the Lender.





“Security Document” means,
individually, and “Security
Documents” means, collectively, the Mortgage, the Collateral Assignment
and each other agreement or writing pursuant to which Borrower purports to
pledge or grant a lien or security interest in any real or personal property or
assets securing the Obligations, together with all documents delivered in
connection therewith.





“Solvent” means, as to any
Person on a particular date, that such Person (a) has capital sufficient to
carry on its business and transactions and all business and transactions in
which it is about to engage and is able to pay its debts as they mature, (b)
owns assets having a value, both at fair valuation and at present fair saleable
value, greater than the amount required to pay its liabilities (including
contingencies) as they become absolute and matured, and (c) does not believe
that it will incur debts or liabilities beyond its ability to pay such debts or
liabilities as they mature.





“Subsidiary” means as to any
Person, any corporation, partnership, limited liability company or other entity
of which more than fifty percent (50%) of the outstanding Capital Securities
having ordinary voting power to elect a majority of the board of directors or
other managers of such corporation, partnership, limited liability company or
other entity is at the time, directly or indirectly, owned by or the management
is otherwise controlled by such Person (irrespective of whether, at the time,
Capital Securities of any other class or classes of such corporation,
partnership, limited liability company or other entity shall have
or






7






might
have voting power by reason of the happening of any
contingency).  Unless otherwise qualified references to “Subsidiary” or “Subsidiaries” herein shall
refer to those of the Borrower.




“UCC” means the Uniform
Commercial Code as codified in the State of Connecticut or as codified in any
other state the laws of which are required by Article 9 thereof to be applied in
connection with the issue or perfection of security interests, as such statutes
are in effect during the term hereof.  All terms used in this
Agreement which are defined in the UCC shall be construed and defined in
accordance with the meaning and definition ascribed to such terms under the UCC,
unless another meaning is specifically provided herein.





“United States” means the
United States of America.





Section
1.02.General.  Unless
otherwise specified, a reference in this Agreement to a particular section,
subsection, Schedule or Exhibit is a reference to that section, subsection,
Schedule or Exhibit of this Agreement.  Wherever from the context it
appears appropriate, each term stated in either the singular or plural shall
include the singular and plural, and pronouns stated in the masculine, feminine
or neuter gender shall include the masculine, the feminine and the
neuter.  The words “include”, “includes” and “including” shall be deemed to
be followed by the phrase “without limitation”.  The word “will” shall be construed to
have the same meaning and effect as the word “shall”.





Section
1.03.Other Definitions and
Provisions.





(a)Use of Capitalized
Terms.  Unless otherwise defined therein, all capitalized terms
defined in this Agreement shall have the defined meanings when used in this
Agreement, the Note and the other Loan Documents or any certificate, report or
other document made or delivered pursuant to this Agreement.





(b)Miscellaneous.  The
words hereof, herein and hereunder and words of similar import when used in this
Agreement shall refer to this Agreement as a whole and not to any particular
provision of this Agreement.




ARTICLE
II




THE
LOANS; LENDER FEES





Section
2.01.The
Loan.  Subject to the satisfaction of the terms and conditions
hereof and at the discretion of the Lender, and in reliance on the
representations and warranties contained herein and in the other Loan Documents,
the Lender agrees to furnish the Loan, which shall be a term loan to the
Borrower consisting of not more than three (3) tranches (each a “Tranche”) in an aggregate
amount not to exceed the original principal amount of the lesser of (i) Ten
Million Five Hundred Thousand and 00/100 Dollars ($10,500,000.00); (ii) seventy
percent (70%) of the “as is” value of the Property; or (iii) the amount which
would result in a debt service coverage ratio equal to or greater than the
required Debt Service Coverage Ratio (as hereinafter defined) on an “as leased”
basis.  The Loan shall be used to (a) pay related closing expenses,
and (b) return a portion of the equity to the Borrower.






8





Section
2.02.Limitations.  In
addition to the limitations set forth in Section 2.01 above, the Loan shall be
advanced subject to the following limitations:





(a)           On
the date of this Agreement, the Borrower shall be eligible to receive an advance
(the “Initial Tranche”)
not to exceed the lesser of: (i) Eight Million Five Hundred Thousand and 00/100
Dollars ($8,500,000.00); (ii) seventy percent (70%) of the “as is” value of the
Property; or (iii) the amount which would result in a debt service coverage
ratio equal to or greater than the required Debt Service Coverage Ratio on an
“as leased” basis including rents payable under the Master Lease (as hereinafter
defined), as if such rents were being paid.





(b)           The
Borrower will be eligible to receive the remaining portion of the Loan not
advanced in the Initial Tranche in not more than two (2) additional Tranches
(each a “Future Tranche”
and collectively the “Future
Tranches”) upon satisfaction of the following conditions:







(i)           The
aggregate amount of all Tranches shall not exceed the original principal amount
of the lesser of (i) Ten Million Five Hundred Thousand and 00/100 Dollars
($10,500,000.00); (ii) seventy percent (70%) of the then “as is” value of the
Property; or (iii) an amount which would result in a debt service coverage ratio
equal to or greater than the Debt Service Coverage Ratio on an “as leased” basis
excluding rents payable under the Master Lease.







(ii)           All
Future Tranches shall be advanced, if at all, not later than July 9,
2012.







(iii)           The
Borrower shall enter into and execute an Interest Rate Protection Agreement (as
hereinafter defined) and such additional documentation as is necessary thereto
for each Future Tranche.







(iv)           For
each requested Future Tranche, the Lender may require the Borrower to provide
the Lender with a new or updated appraisal of the Property, which new or updated
appraisal shall comply with all of the requirements of Section 2.05 of this
Agreement for the appraisal required as a condition precedent to the
Closing.  Notwithstanding anything contained herein to the contrary,
if the requested Future Tranche is more than eighteen (18) calendar months after
the Closing Date, the Borrower shall provide the Lender with a new appraisal of
the Property, which appraisal shall comply with all of the requirements of
Section 2.05.







Section
2.03.Interest and Repayment of
Principal of Loan.  The Note evidencing the Loan (the “Note”) is attached hereto as
Schedule A, and
contains all the terms relative to the repayment of principal, the payment of
interest and the rate at which interest shall accrue.





Section
2.04.Maturity
Date.  The entire balance of the Loan shall be due and payable
on or before the Maturity Date (as defined in the Note).





9
 
  
 Section
2.05.Appraisals.  Unless
otherwise specified herein or in the Mortgage, any appraisals referenced or
required by this Agreement shall mean an appraisal, to the reasonable
satisfaction of the Lender, of the Property prepared by an MAI appraiser
approved by the Lender, which approval shall not be unreasonably withheld, which
appraisal must be paid for by the Borrower.





ARTICLE
III


GENERAL
LOAN PROVISIONS





Section
3.01.Manner of
Payment.  Each payment by the Borrower on account of the
principal of or interest on the Loan or of any fee, commission or other amounts
payable to the Lender under this Agreement, the Note or Mortgage shall be made
not later than 3:00 p.m. (New York time) on the date specified for payment under
such document or instrument, as applicable, to the Lender at the Lender’s Office
for the account of the Lender (except as specified below), in Dollars, in
immediately available funds and shall be made without any set-off, counterclaim
or deduction whatsoever.  Any payment received after such time but
before 4:00 p.m. (New York time) on such day shall be deemed a payment on such
date for the purposes of Section 10.01, but
for all other purposes shall be deemed to have been made on the next succeeding
Business Day.  Any payment received after 4:00 p.m. (New York time)
shall be deemed to have been made on the next succeeding Business Day for all
purposes.  If any payment under this Agreement, the Note or Mortgage
shall be specified to be made upon a day which is not a Business Day, it shall
be made on the next succeeding day which is a Business Day, and such extension
of time shall in such case be included in computing any interest if payable
along with such payment.  Borrower hereby grants to the Lender the
right to make withdrawals from the Operating Account to make payments on the
Obligations as and when due hereunder.





Section
3.02.Credit of Payments and
Proceeds.  In the event that Borrower shall fail to pay any of
the Obligations when due and the Obligations have been accelerated pursuant to
Section 10.02,
all payments received by the Lender upon the Note and the other Obligations and
all net proceeds from the enforcement of the Obligations shall be applied as set
forth in Section
10.03.





Section
3.03.Voluntary Prepayment of the
Loan.  The Loan may be prepaid upon the terms and conditions
set forth in the Note evidencing the Loan.  Borrower acknowledges that
additional obligations may be associated with any such prepayment under the
terms and conditions of the Note and the Interest Rate Protection
Agreement.  Borrower shall give the Lender notice of any proposed
prepayment of the Loan in accordance with the Note, which notice shall specify
the proposed date of payment and the principal amount to be
paid.  Each partial prepayment of the principal amount of the Loan
shall be accompanied by the payment of all charges outstanding on the Loan
(including any Prepayment Fee, as defined in the Note) and of all accrued
interest on the principal repaid to the date of payment.





Section
3.04.LIBOR Rate Lending
Unlawful.  If the Lender shall reasonably determine (which
determination shall, upon notice thereof to Borrower, be conclusive and






10










Section
3.05.Intentionally
Omitted.





Section
3.06.Increased
Costs.  If on or after the date hereof the adoption of any
applicable law, rule or regulation or guideline (whether or not having the force
of law), or any change therein, or any change in the interpretation or
administration thereof by any governmental authority, central bank or comparable
agency charged with the interpretation or administration thereof, or compliance
by the Lender with any request or directive (whether or not having the force of
law) of any such authority, central bank or comparable agency:





(a)           shall
subject the Lender to any tax, duty or other charge with respect to the Loan or
its obligation to make the LIBOR Rate Loan, or shall change the basis of
taxation of payments to the Lender of the principal of, or interest on, the Loan
or any other amounts due under this agreement in respect of the Loan or its
obligation to make the Loan (except for the introduction of, or change in the
rate of, tax on the overall net income of the Lender or franchise taxes, imposed
by the jurisdiction (or any political subdivision or taxing authority thereof)
under the laws of which the Lender is organized or in which the Lender’s
principal executive office is located); or





(b)           shall
impose, modify or deem applicable any reserve, special deposit or similar
requirement (including, without limitation, any such requirement imposed by the
Board of Governors of the Federal Reserve System of the United States) against
assets of, deposits with or for the account of, or credit extended by, the
Lender or shall impose on the Lender or on the London interbank market any other
condition affecting the Loan or its obligation to make the Loan;





and
the result of any of the foregoing is to increase the cost to the Lender of
making or maintaining the Loan as a LIBOR Rate Loan, or to reduce the amount of
any sum received or receivable by the Lender under this agreement with respect
thereto, by an amount deemed by the Lender to be material, then, within fifteen
(15) days after demand by the Lender, Borrower shall pay to the Lender such
additional amount or amounts as will compensate the Lender for such increased
cost or reduction.





Section
3.07.Increased Capital
Costs.  If any change in, or the introduction, adoption,
effectiveness, interpretation, reinterpretation or phase-in of, any law or
regulation,






11











Section
3.08.Taxes.  All
payments by Borrower of principal of, and interest on, the Loan and all other
amounts payable hereunder shall be made free and clear of and without deduction
for any present or future income, excise, stamp or franchise taxes and other
taxes, fees, duties, withholdings or other charges of any nature whatsoever
imposed by any taxing authority, but excluding franchise taxes and taxes imposed
on or measured by the Lender’s net income or receipts or income from the Loan
(such non-excluded items being called “Taxes”).  In the
event that any withholding or deduction from any payment to be made by Borrower
hereunder is required in respect of any Taxes pursuant to any applicable law,
rule or regulation, then Borrower will:





(a)           pay
directly to the relevant authority the full amount required to be so withheld or
deducted;





(b)           promptly
forward to the Lender an official receipt or other documentation satisfactory to
the Lender evidencing such payment to such authority; and





(c)           pay
to the Lender such additional amount or amounts as is necessary to ensure that
the net amount actually received by the Lender will equal the full amount the
Lender would have received had no such withholding or deduction been
required.





Moreover,
if any Taxes are directly asserted against the Lender with respect to any
payment received by the Lender hereunder, the Lender may pay such Taxes and
Borrower will promptly pay such additional amount (including any penalties,
interest or expenses) as is necessary in order that the net amount received by
the Lender after the payment of such Taxes (including any Taxes on such
additional amount) shall equal the amount the Lender would have received had not
such Taxes been asserted.





If
Borrower fails to pay any Taxes when due to the appropriate taxing authority or
fails to remit to the Lender the required receipts or other required
documentary






12







Section
3.09.Interest Rate Protection
Agreement.  Borrower has entered into a certain ISDA 2002
Master Agreement with the Lender (together with the confirmation thereof and all
schedules thereto, and as may be amended or substituted from time to time, the
“Interest Rate Protection
Agreement”) dated as of the Closing Date (the “ISDA Commencement Date”), in
order to eliminate the risk with respect to fluctuation of the interest rate in
connection with the Loan.  The Interest Rate Protection Agreement
shall be effective as of such date with the payment terms and the rate as
referenced therein to commence on the ISDA Commencement Date and shall continue
until the Maturity Date and shall, at all times, be in a notional amount equal
to the entire outstanding principal amount of the Loan.  If the
Interest Rate Protection Agreement shall expire prior to the Maturity Date and
leave any principal of the Loan uncovered thereby, or if for any other reason
any principal portion of the Loan shall be uncovered by the Interest Rate
Protection Agreement during the period of time commencing on the ISDA
Commencement Date and ending on the Maturity Date, such uncovered amount shall
be immediately due and payable.  All costs, expenses, penalties and
indemnity obligations that may be incurred by Lender as a result of Borrower’s
default under, or termination of, the Interest Rate Protection Agreement,
including but not limited to the costs of unwinding the Interest Rate Protection
Agreement, shall be (a) subject to immediate reimbursement by Borrower pursuant
to the terms hereof and to the Interest Rate Protection Agreement, and (b)
secured by the Security Documents.  In the event the Loan is
terminated or Borrower repays all amounts due under the Loan prior to the
termination date set forth in the Interest Rate Protection Agreement, subject to
the terms thereof, Borrower shall be obligated to terminate said Interest Rate
Protection Agreement and pay to the Lender any and all amounts that may be
outstanding under said Interest Rate Protection Agreement in addition to any
other amounts that may be due the Lender under this Agreement, the Note and the
other Loan Documents.  In the event Borrower makes a partial
prepayment on the Loan as permitted hereby, Borrower shall be obligated to pay
to the Lender any and all amounts that may be payable under the terms of the
Interest Rate Protection Agreement with respect to such partial prepayment in
addition to any other amounts that may be due the Lender under this Agreement,
the Note and the other Loan Documents.





ARTICLE
IV




COLLATERAL
AND GRANT OF SECURITY INTEREST





Section
4.01.Security
Interest.  As security for the payment of the Loan and the
performance by the Borrower of its Obligations, the Borrower hereby mortgages,
pledges and assigns to the Lender, and gives and grants to the Lender, security
interests in all of its personal property and fixtures which are now or
hereafter installed or stored at the Property and all of its right, title and
interest in and to the items and types of property, described or referred to
below, whether now owned or hereafter acquired and which are now or hereafter
installed or stored at the Property, and the proceeds and products thereof, (all
of which property is herein collectively called the “UCC Collateral”), which
security interest is and shall remain first and prior and which UCC Collateral
shall remain free and clear of all








13







mortgages,
pledges, security interests, liens, and other encumbrances and restrictions on
the transfer thereof except liens permitted hereunder.





(a)           All
of Borrower right, title and interest in and to all appliances, machinery and
equipment owned by the Borrower now or hereafter installed or stored at the
Property, including but not limited to gas and electric fixtures, radiators,
heaters, engines and machinery, boilers, ranges, elevators, escalators,
incinerators, motors, dynamos, sinks, disposals, dishwashers, water closets,
basins, medicine chests, pipes, faucets and other plumbing and heating fixtures,
ventilating apparatus, dryers, air-conditioning equipment and units, paneling,
refrigerating plant, refrigerators, whether mechanical or otherwise, fire
prevention and extinguishing apparatus, shades, awnings, screens, blinds,
carpeting, wall cabinets, furniture and equipment, and also any and all other
fixtures and articles of personal property owned by the Borrower now or
hereafter attached to, stored at, the Property.





(b)           All
rents, income, profits, security deposits and other benefits to which the
Borrower may now or hereafter be entitled from the leases of the
Property.





(c)           All
of the Borrower’s right, title and interest in and to proceeds of casualty and
other insurances relating to the Property and all causes of action, claims,
compensation and recoveries for any damage, condemnation or taking of the
Property, or for any conveyance in lieu thereof, whether direct or
consequential, or for any damage or injury to the Property, or for any loss or
diminution in value of the Property.





(d)           The
foregoing collateral includes all additions, replacements and substitutions
thereof and thereto and all proceeds of all of the foregoing, as these terms are
used and defined in the Uniform Commercial Code.





(e)           All
of the Borrower’s right, title and interest in and to the Operating
Account.





(f)           All
Proceeds (as such term is defined in Article 9 of the UCC), including without
limitation all proceeds and all products of all Collateral described
above.  The security interest described herein continues in all UCC
Collateral, notwithstanding sale, exchange or other disposition thereof by the
Borrower.





Section
4.02.Authorization Re: Financing
Statements.





(a)           The
Lender may at any time and from time to time file financing statements,
continuation statements and amendments thereto that describe the Collateral and
which contain any other information required by Lender or by Part 5 of Article 9
of the UCC for the sufficiency or filing office acceptance of any financing
statement, continuation statement or amendment, including whether the Borrower
is an organization, the type of organization and any organization identification
number issued to the Borrower.  The Borrower shall furnish any such
identification number issued promptly to the Lender.






14







(b)           Nothing
contained herein shall be construed to narrow the scope of the security interest
granted hereby in any of the Collateral or the perfection or priority thereof or
to impair or otherwise limit any of the rights, powers, privileges or remedies
of the Lender hereunder except as (and then only to the extent) specifically
mandated by Article 9 of the UCC to the extent then
applicable.  Notwithstanding the foregoing, the parties agree that
Lender’s security interest hereunder shall not extend to any Hazardous Materials
or devices utilized primarily for the storage of Hazardous
Materials.




ARTICLE
V




REPRESENTATIONS
AND WARRANTIES OF THE BORROWER





Section
5.01.Representations and
Warranties.  To induce the Lender to enter into this Agreement
and to induce the Lender to make the Loan, the Borrower hereby represents and
warrants to the Lender, that:





(a)           Organization; Power;
Qualification.  The Borrower is duly formed, validly existing
and in good standing under the laws of the jurisdiction of its formation, has
the power and authority to own its properties and to carry on its business as
now being and hereafter proposed to be conducted and is duly qualified and
authorized to do business in each jurisdiction in which the character of its
properties or the nature of its business requires such qualification and
authorization except where the failure to be qualified would not reasonably be
expected to have a Material Adverse Effect.





(b)           Authorization of Agreement,
Loan Documents and Borrowing.  The Borrower has the right,
power and authority and has taken all necessary corporate and other action to
authorize the execution, delivery and performance of this Agreement and each of
the other Loan Documents to which it is a party in accordance with their
respective terms.  This Agreement and each of the other Loan Documents
to which it is a party have been duly executed and delivered by a duly
authorized officer of the Borrower, and each such document constitutes the
legal, valid and binding obligation of the Borrower, enforceable in accordance
with its terms, except as such enforcement may be limited by any Debtor Relief
Law from time to time in effect which affect the enforcement of creditors rights
in general and the availability of equitable remedies.





(c)           Compliance of Agreement,
Loan Documents and Borrowing with Laws, etc.  Except as set
forth on Schedule
5.01(c), the execution, delivery and performance by the Borrower of the
Loan Documents to which it is a party, the borrowings hereunder and thereunder
and the consummation of the other transactions contemplated hereby and thereby
do not and will not, by the passage of time, the giving of notice or otherwise:
(i) require any Governmental Approval or violate any Applicable Law relating to
the Borrower, (ii) conflict with, result in a breach of or constitute a default
under the Borrower’s articles of incorporation, by-laws or other organizational
documents of the Borrower or any indenture, material agreement or other
instrument to which it is a party or by which any of its material properties may
be bound or any Governmental Approval relating to the Borrower, or (iii) result
in, or require the creation or imposition of, any Lien upon or with respect to
any property now owned or hereafter acquired by the Borrower other than Liens
arising under the Loan Documents.






15








(d)Compliance with Law;
Governmental Approvals; Other Consents and Approvals.  The
Borrower: (i) has all Governmental Approvals required by any Applicable Law for
the Borrower to own and operate the Property, each of which is in full force and
effect, (ii) is in compliance with each Governmental Approval and Applicable Law
applicable to the Borrower’s ownership and operation of the Property, and (iii)
except as set forth on Schedule 5.01(d), has
obtained all Governmental Approvals and other consents and approvals required or
necessary for the consummation of the transactions contemplated by the Loan
Documents.





(e)Tax Returns and
Payments.  The Borrower has duly filed or caused to be filed
all material federal, state, local and other material tax returns required by
Applicable Law to be filed, and has paid, or made adequate provision for the
payment of, all material federal, state, local and other taxes, assessments and
governmental charges or levies upon it and its property, income, profits and
assets which are due and payable, except such taxes, assessments and
governmental charges or levies that are being contested in good faith by
appropriate proceedings and with respect to which adequate reserves have been
established on the books of the Borrower to the extent required by
GAAP.  No Governmental Authority has asserted any Lien or other claim
against the Borrower with respect to unpaid taxes which has not been discharged
or resolved.  The charges, accruals and reserves on the books of the
Borrower in respect of federal, state, local and other taxes for all Fiscal
Years and portions thereof since the organization of the Borrower are in
Borrower’s judgment adequate.





(f)Intentionally
Omitted.





(g)Environmental
Matters. Except for the matters set forth on Schedule 5.01(g)
hereto:





(i)           The
Property does not contain, and to the Borrower’s Knowledge has not previously
contained, any Hazardous Materials in amounts or concentrations which: (A)
constitute or constituted a material violation of applicable Environmental Laws,
or (B) could reasonably be expected to give rise to liability under applicable
Environmental Laws;
 
 (ii)           All
operations conducted in connection with the Property are in material compliance,
and, to the Borrower’s Knowledge, have been in material compliance, with all
applicable Environmental Laws, and to the Borrower’s Knowledge there is no
contamination at, under or about the Property which materially interferes with
the continued operation of the Property or materially impairs the fair saleable
value thereof;
 
 (iii)           Borrower
has not received any written notice of violation, alleged violation,
non-compliance, liability or potential liability regarding Hazardous Materials,
or compliance with Environmental Laws relating to the Property, nor to the
Borrower’s Knowledge is there any reason to believe that any such notice will be
received or is being threatened;
 
 16
 (iv)           To
the Borrower’s Knowledge, (A) Hazardous Materials have not been disposed at, or
transported from the Property in any manner which would give rise to liability
under Environmental Laws, and (B) Hazardous Materials have not been generated,
treated, stored, or disposed of at, on or under any of the Property in violation
of, or in a manner that would give rise to liability under, any applicable
Environmental Laws;
 
 (v)           No
judicial proceedings or governmental or administrative action is pending, or, to
Borrower’s Knowledge, is threatened, under any Environmental Law with respect to
the Property to which the Borrower is or will be named as a party, nor are there
any consent decrees or other decrees, consent orders, administrative orders or
other orders outstanding under any Environmental Law with respect to the
Property; and
 
 (vi)           To
Borrower’s Knowledge, during the Borrower’s, or any of Borrower’s Affiliates,
period of ownership or occupancy, there has been no release of Hazardous
Materials at or from the Property, in violation of, or in a manner that could
reasonably be expected to give rise to liability under, any Environmental
Law.
 
 (vii)           To
Borrower’s Knowledge, there has been no release prior to the Borrower’s
ownership period of Hazardous Materials at or from the Property, in violation
of, or in a manner that could reasonably be expected to give rise to liability
under, any Environmental Law.
 
 (viii)           To
Borrower’s Knowledge, there has been no threat of release at any time, of
Hazardous Materials at or from the Property, in violation of, or in a manner
that could reasonably be expected to give rise to liability under, any
Environmental Law.


(h)           ERISA.  The
Borrower and each ERISA Affiliate of it is in compliance with all applicable
provisions of ERISA and the regulations and published interpretations thereunder
with respect to all employee benefit and pension plans and no liability has been
incurred by the Borrower or any such ERISA Affiliate of the Borrower which
remains unsatisfied for any taxes or penalties with respect to any such employee
benefit and pension plan.




(i)           Margin
Stock.  The Borrower is not engaged principally or as one of
its activities in the business of extending credit for the purpose of purchasing
or carrying any margin stock (as each such term is defined or used in Regulation
U of Federal Reserve Board).  No part of the proceeds of the Loan will
be used for purchasing or carrying margin stock or for any purpose which
violates the provisions of Regulation T, U or X of such Federal Reserve
Board.




(j)           Government
Regulation.  The Borrower is not an investment company or a
company controlled by an investment company (as each such term is defined or
used in the Investment Company Act of 1940, as amended), and the Borrower is
not, or after giving






17


effect
to the Loan will not be, subject to regulation under any other Applicable Law
which limits its ability to incur or consummate the transactions contemplated
hereby.






(k)           Employee
Relations.  There are no pending or, to the Borrower’s
Knowledge, threatened or contemplated strikes, work stoppage or other collective
labor disputes involving its employees.




(l)           Health and Safety;
Zoning.




(i)
            Borrower
      has obtained all necessary certificates, licenses and other approvals,
      governmental and otherwise, necessary for the occupancy of the Property
      and the operation of the Property and all required zoning, building code,
      land use, environmental and other similar permits or approvals, all of
      which are in full force and effect as of the date hereof and not subject
      to revocation, suspension, forfeiture or
  modification.





(ii)
            The
      Property and the present and contemplated use and occupancy thereof are in
      full compliance with all applicable zoning ordinances, health and building
      codes, land use laws, fire codes and other similar
  laws.





(iii)
            The
      Property is served by all utilities required for the current or
      contemplated use thereof.  Except as provided in the next
      sentence, all utility service is provided by public utilities and the
      Property has accepted or is equipped to accept such utility
      service.  The portions of the Property known and numbered as 14
      International Drive, East Granby, Connecticut and 40 International Drive,
      Windsor, Connecticut have drinking water supplied by wells located on such
      properties.





(iv)
            All
      public roads and streets necessary for service of, and access to, the
      Property for the current or contemplated use thereof have been completed,
      are serviceable and all-weather and are physically and legally open for
      use by the public.





(v)
            The
      Property is served by public water and sewer systems; however, as provided
      in Section 5.01(l)(iii) above, drinking water at the 14 International
      Drive, East Granby, Connecticut property and the 40 International Drive,
      Windsor, Connecticut property is obtained from wells located on such
      properties.





(vi)
            The
      Property is free from damage caused by fire or other
    casualty.





(vii)
            All
      costs and expenses of any and all labor, materials, supplies and equipment
      used in the construction of the Improvements (as defined in the Mortgage)
      have been paid in full.





(viii)
            Borrower
      has paid in full for, and is the owner of, all furnishings, fixtures and
      equipment (other than tenants’ property) used in
  connection






18






with
      the operation of the Property, free and clear of any and all security
      interests, liens or encumbrances, except the lien and security interest
      created hereby.




(ix)
            All
      liquid and solid waste disposal, septic and sewer systems located on the
      Property, if any, are in a good and safe condition and repair and in
      compliance with all Applicable
Laws.





(x)
            No
      portion of the Improvements is located in an area identified by the
      Secretary of Housing and Urban Development or any successor thereto as an
      area having special flood hazards pursuant to the Flood Insurance Acts or,
      if any portion of the Improvements is located within such area, Borrower
      has obtained and will maintain the insurance prescribed in Section 3 of
      the Mortgage.





(m)           No Material Adverse
Effect.  Since the date of the most recent financial statements
the Borrower has delivered to the Lender, there has been no material adverse
change in the properties, business, results of operations or financial condition
of the Borrower and no event has occurred or condition arisen that would
reasonably be expected to have a Material Adverse Effect thereon.  The
most recent financial statements the Borrower has delivered to the Lender sets
forth a complete and correct listing of all Debt and Guaranty Obligations of the
Borrower as of the date thereof.




(n)           Solvency.  The
Borrower is and will remain Solvent.




(o)           Title to
Properties.  The Borrower has valid and legal title to all of
the personal property and assets owned by it necessary to operate the
Property.




(p)           Liens.  The
Collateral is not subject to any Lien, except Permitted Liens.




(q)           Debt and Guaranty
Obligations.  Except as set forth on Schedule 5.01(q), the
Borrower is in material compliance with all of the terms of all of its Debt and
Guaranty Obligations that are to remain outstanding during any portion of the
term of the Loan, and all instruments and agreements relating thereto, and no
default or event of default, or event or condition which with notice or lapse of
time or both would constitute such a default or an event of default, on the part
of the Borrower exists with respect to any such Debt and Guaranty
Obligation.




(r)           Litigation.  Except
for matters set forth on Schedule 5.01(r),
there are no actions, suits or proceedings pending or, to the Borrower’s
Knowledge, threatened, against or in any other way adversely relating to or
affecting the Borrower, its operations or any of its properties in any court or
before any arbitrator of any kind or before or by any Governmental Authority,
which would reasonably be expected to have a Material Adverse
Effect.




(s)           Absence of
Defaults.  No event has occurred or is continuing which
constitutes a Default or an Event of Default.






19






(t)           Accuracy and Completeness of
Information.  All written information, reports and other papers
and data (other than financial forecasts) produced by or on behalf of the
Borrower and furnished to the Lender were, at the time the same were so
furnished, complete and correct in all material respects.  The
documents, including any financial statements, furnished or written statements
made to the Lender by the Borrower on or prior to the date hereof in connection
with the negotiation, preparation or execution of this Agreement or any of the
Loan Documents, taken together, do not and will not contain any untrue statement
of a fact material to the creditworthiness of the Borrower or omit to state a
fact necessary in order to make the statements contained therein not misleading
in light of the circumstances in which they were made, all except as otherwise
qualified herein or therein.  The Borrower is not aware of any facts
which it has not disclosed in writing to the Lender having a Material Adverse
Effect (other than general economic conditions), or insofar as any Borrower can
now foresee, would have a Material Adverse Effect.




(u)           Fees and
Commissions.  Borrower does not owe any brokerage or similar
fees or commissions in connection with obtaining the Loan, except (i) those paid
directly to the Lender and (ii) a broker commission payable to CBRE Capital
Markets for which Borrower is solely responsible.


(v)           Foreign Assets Control
Regulations.  Neither the borrowing by Borrower nor the use of
the proceeds thereof will violate the Foreign Assets Control Regulations, the
Foreign Funds Control Regulations, the Transactions Control Regulations, the
Cuban Assets Control Regulations, the Iranian Assets Control Regulations or any
other transaction or asset control regulations of the United States Treasury
Department (31 C.F.R. Subtitle B, Chapter V, as amended).
 
 (w)           Anti-Terrorism
Laws.




(i)  Borrower
is not in violation of any laws or regulations relating to terrorism or money
laundering (“Anti-Terrorism
Laws”), including Executive Order No. 13224 on Terrorist Financing,
effective September 24, 2001 (the “Executive Order”) and the
Uniting and Strengthening America by Providing Appropriate Tools Required to
Intercept and Obstruct Terrorism Act of 2001, Public Law 107-56.




(ii)  Borrower
is not a Prohibited Person.  A “Prohibited Person” is any of
the following:





(a)  a person
or entity that is listed in the Annex to, or is otherwise subject to the
provisions of, the Executive Order;





(b)  a person
or entity owned or controlled by, or acting for or on behalf of, any person or
entity that is listed in the Annex to, or is otherwise subject to the
provisions of, the Executive Order;






20






(c)  a person
or entity with whom any bank is prohibited from dealing or otherwise engaging in
any transaction by any Anti-Terrorism Law;




(d)  a person
or entity who commits, threatens or conspires to commit or supports “terrorism”
as defined in the Executive Order; or




(e)  a person
or entity that is named as a “specially designated national and blocked person”
on the most current list published by the U.S. Treasury Department Office of
Foreign Asset Control at its official website or any replacement website or
other replacement official publication of such list.




(iii)  To the
Borrower’s Knowledge, Borrower (1) has not conducted any business or engaged in
making or receiving any contribution of funds, goods or services to or for the
benefit of any Prohibited Person, (2) has not dealt in, or otherwise engaged in
any transaction relating to, any property or interests in property blocked
pursuant to the Executive Order, and (3) has not engaged in or conspired to
engage in any transaction that evaded or avoided, or had the purpose of evading
or avoiding, or attempted to violate, any of the prohibitions set forth in any
Anti-Terrorism Law.





Section
5.02.Representations Relating to
Collateral.  With respect to the Collateral, the Borrower
represents, warrants and covenants that:




(a)           Borrower
is the sole owner, free and clear of all liens, claims, security interests and
encumbrances, except for Permitted Liens, and Borrower is fully authorized to
sell, transfer, pledge and/or grant a security interest in each and every item
of Collateral;




(b)           To
the Borrower’s Knowledge, none of the transactions underlying or giving rise to
the Collateral violate any applicable state or federal laws or regulations, and
all documents relating to the Collateral are legally enforceable in accordance
with their terms.  The failure of any Collateral to fully comply with
the provisions of this Section shall not affect, terminate, modify or otherwise
limit the Lender’s lien or security interest in the Collateral.  The
Borrower shall immediately notify the Lender of the failure of any Collateral to
fully comply with the provisions of this Section.





Section
5.03.Survival of Representations
and Warranties, etc.  All representations and warranties set
forth in this Article
V and all representations and warranties contained in any certificate
delivered pursuant to this Agreement, or in any of the Loan Documents (including
any such representation or warranty made in, or in connection with, any
amendment thereto) shall constitute representations and warranties made under
this Agreement.  All representations and warranties made under this
Agreement:  (i) shall be made or deemed to be made at and as of the
date hereof, (ii) survive the closing of the Loan and shall not be waived by the
execution and delivery of this Agreement, any investigation made by or on behalf
of the Lender or the making of the Loan hereunder, and (iii) shall be








21








made or
deemed to be made at and as of the date of each request to the Lender for a
Future Tranche.





ARTICLE
VI


FINANCIAL
INFORMATION AND NOTICES





Section
6.01.Financial Statements.
Until all the Obligations have been paid and satisfied in full, unless consent
has been obtained in the manner set forth in Section 11.09 hereof,
Borrower will furnish or cause to be furnished to the Lender annually (i) within
ninety (90) days after the close of each Fiscal Year of Borrower that ends
during the life of the Loan, financial reports with respect to the Property
showing the annual rent roll, profit and loss statements, other income, and the
detailed operating expenses of the Property prepared and certified by the
Borrower, all in accordance with GAAP and in such detail as the Lender may
reasonably require; (ii) within ten (10) days upon the Borrower’s filing of Form
10-K with the Securities and Exchange Commission (“SEC”), audited financial
statements of the Borrower; (iii) financial statements of all tenants at the
Property required to provide same under the terms of its lease within thirty
(30) days of Borrower’s receipt of the same; and (iv) such other financial
information in such detail as the Lender may reasonably require within a
reasonable period of time following the Lender’s request for same, but no longer
than thirty (30) days after such request.  Notwithstanding the
foregoing, for so long as the Borrower is a publicly traded company and is
required to file its financial statements annually with the SEC, the financial
reports required under (ii) above shall be satisfied by the Borrower’s filing of
the Form 10-K and the Borrower’s delivery of a copy of the same to the
Lender.





Section
6.02.Intentionally
Omitted.





Section
6.03.Notice of Litigation and
Other Matters.  Promptly (but in no event later than five (5)
days after Borrower obtains knowledge thereof) Borrower shall provide
Lender with written notice of:  (a) the commencement of all
proceedings and investigations, including those by or before any Governmental
Authority, and all actions and proceedings in any court or before any arbitrator
against or involving the Borrower or the Property or any other Collateral, which
would reasonably be expected to have a Material Adverse Effect; (b) any notice
of any violation received by the Borrower from any Governmental Authority with respect to the Property or the
Collateral including any notice of violation of Environmental Laws;
(c) any labor controversy that has resulted in, or threatens to result in, a
strike or other work stoppage against the Borrower which would reasonably be
expected to have a Material Adverse Effect; (d) any attachment, judgment, lien,
levy or order exceeding (1) $250,000 that has been assessed against the Borrower
or (2) $100,000 that has been assessed against the Collateral, in either case
excluding judgments that are fully covered by insurance; (e) any Default or
Event of Default by which the Borrower, the Property or the Collateral may be
bound; and (f) any Collateral is (i) materially damaged or destroyed, or suffers
any other material loss, or (ii) is condemned, confiscated or otherwise taken,
in whole or in part, or the use thereof is otherwise diminished so as to render
impracticable or unreasonable the use of such asset or property for the purpose
to which such property was used immediately prior to such condemnation,
confiscation or taking, by exercise of the powers of condemnation or eminent
domain or otherwise, and in either case the amount of






22






Casualty Loss





Section
6.04.Accuracy of
Information.  All written information, reports, statements and
other papers and data furnished by or on behalf of the Borrower to the Lender
(other than financial forecasts and information prepared by third parties and
required to be delivered to the Lender by this Agreement) whether pursuant to
this Article VI
or any other provision of this Agreement, or any of the Loan Documents, shall
be, at the time the same is so furnished, complete and correct in all material
respects.






ARTICLE
VII


AFFIRMATIVE
COVENANTS





Until all
of the Obligations have been paid and satisfied in full, unless consent has been
obtained in the manner provided for in Section 11.09, the
Borrower covenants and agrees as follows:





Section
7.01.Preservation of Existence
and Related Matters.  Borrower shall preserve and maintain its
separate existence, form, jurisdiction of organization and tax status, and all
rights, franchises, licenses and privileges necessary to the conduct of its
business, and qualify and remain qualified as a foreign corporation and
authorized to do business in each jurisdiction where the nature and scope of its
activities require it to so qualify under Applicable Law except where the
failure to be qualified would not reasonably be expected to have a Material
Adverse Effect.





Section
7.02.Maintenance ofProperty; Operation of
Property.  In addition to the requirements of any of the Loan
Documents, protect and preserve all properties useful in and material to the
Collateral, maintain in good working order and condition (subject to ordinary
wear and tear) all of the Collateral and from time to time make or cause to be
made all renewals, replacements and additions to the Collateral.





Section
7.03.Insurance.  Borrower
shall keep the Collateral insured with no less than the following
coverages:  (i) Fire and extended coverage insurance including
vandalism and malicious mischief, broadened to the so-called “All Risk of
Physical Loss” coverage basis, in an amount, after application of any
deductibles acceptable to the Lender, of not less than one hundred percent
(100%) of the full replacement value of the insured property (both real and
personal, including fixtures and equipment) at the time of issuance of such
policy or policies and at each renewal date thereof, exclusive of land,
excavations, foundations and other items normally excluded from the such
policies; (ii) loss of rent insurance in an amount not less than the aggregate
rental value of the Property for a period of one (1) year if available, or
business interruption insurance in an amount acceptable to the Lender, as the
case may be; (iii) public liability insurance in an amount not less than
$1,000,000.00 and workman’s compensation insurance (if applicable); and (iv)
flood insurance, if any of the improvements on the Property are located in an
area designated as a special flood hazard area by the Director of the Federal
Emergency Management Agency, naming the Lender as an additional insured
party.  If no flood insurance is to be provided, Borrower shall
provide Lender with evidence satisfactory to Lender from a licensed surveyor or
engineer that the






23







Section
7.04.Accounting Methods and
Financial Records.  Borrower shall maintain a system of
accounting, and keep such books, records and accounts (which shall be true and
complete in all material respects) as may be required or as may be necessary to
permit the preparation of financial statements in accordance with GAAP and in
compliance with the regulations of any Governmental Authority having
jurisdiction over it or any of its properties.





Section
7.05.Payment and Performance of
Obligations.  Pay and perform all Obligations under this
Agreement and the other Loan Documents, and pay or perform within applicable
grace periods (a) all taxes, assessments and other governmental charges that may
be levied or assessed upon it or any of its property and that would reasonably
be expected to have a Material Adverse Effect, and (b) all other indebtedness,
obligations and liabilities that would reasonably be expected to have a Material
Adverse Effect in accordance with customary trade practices; provided, that the
Borrower may contest any item described in clause (a) or (b) of this Section 7.05 in good
faith so long as adequate reserves are maintained with respect thereto in
accordance with GAAP.





Section
7.06.Compliance With Laws and
Approvals.  Observe and remain in compliance with all
Applicable Laws relating to the ownership and operation of the Property and
maintain in full force and effect all Governmental Approvals with respect to the
Property in each case where failure would reasonably be expected to have a
Material Adverse Effect.





Section
7.07. Environmental
Laws.  In addition to and without limiting the generality of
Section7.06 with respect to
the Property, Borrower shall (a) comply with all applicable Environmental Laws;
(b) obtain and comply with any and all licenses, approvals, notifications,
registrations or permits required by applicable Environmental Laws; (c) conduct
and complete all investigations, studies, sampling and testing, and all
remedial, removal and other actions required under applicable Environmental
Laws, and promptly comply with all lawful orders and directives of any
Governmental Authority regarding such Environmental Laws, except orders and
directives that are being challenged in good faith; and (d) defend, indemnify
and hold harmless the Lender, and its Subsidiaries, Affiliates,






24











Section
7.08.Compliance with
ERISA.  In addition to and without limiting the generality of
Section 7.06,
Borrower shall comply with all applicable provisions of ERISA and the
regulations and published interpretations thereunder with respect to all
employee benefit and pension plans maintained by Borrower and any Affiliate of
Borrower.





Section
7.09.Visits and
Inspections.  Borrower shall permit representatives of the
Lender or its designated agents, from time to time, and upon reasonable prior
notice, not more frequently than once per Fiscal Year (unless a Default or Event
of Default shall have occurred) and during Borrower’s regular business hours
without disruption to Borrower’s business or to any tenants at the Property, to:
(a) visit and inspect the Property (including the performance of field audits);
(b) inspect, audit and make extracts from Borrower’s books, records and files
relating to the Property, including management letters prepared by independent
accountants; and (c) discuss with Borrower’s principal officers and its
independent accountants, the operation of the Property by the
Borrower.  Borrower shall not be responsible for the cost of any field
examinations unless the same are conducted during the continuance of an Event of
Default in which event, the Borrower shall reimburse the Lender for the conduct
of any field examinations at Lender’s then current per diem rates plus
expenses.




Section
7.10.Appraisals.  From
time to time, Borrower shall permit the Lender to obtain additional appraisals
of all or any portion of the Property, and if an appraisal is required by law,
is made to ascertain the value of the Property upon considering a loan
extension, or is commissioned following an Event of Default, then Borrower shall
pay to the Lender within ten (10) business days of demand all costs of such
appraisal.  Appraisals shall be the property of the Lender and, except
for appraisals performed in connection with the Borrower’s request for a Future
Tranche or an extension of the Loan (in each such case Lender shall provide
copies of such appraisals to Borrower provided the Borrower signs the Lender’s
then standard non-disclosure and non-reliance agreement), the Lender will have
no obligation to disclose the content of any appraisals to any person or entity,
including the Borrower.


Section
7.11.OperatingAccount.  Throughout
the term of the Loan, the Borrower shall maintain an Operating Account in the
name of the Borrower at the Lender into which Borrower shall deposit all
advances under the Loan (including all Tranches), all proceeds of sale from the
sale of portions of the Property and all other income and profits derived from
the Property.  Without limiting the generality of the foregoing,
Borrower shall deposit or cause to be deposited directly into said account all
income and profits derived or received






25










Section
7.12.Further
Assurances.  Borrower shall make, execute and deliver all such
additional and further acts, things, deeds and instruments as the Lender may
reasonably require to document and consummate the transactions contemplated
hereby and to vest completely in and insure the Lender its rights under this
Agreement, the Note and the other Loan Documents.





Section
7.13.Principal
Office.  Borrower shall not change its principal executive
offices from the address first set forth above, change its name, or change the
location of the Collateral or the books and records related thereto without
giving the Lender thirty (30) days’ advance notice and in the event of such
change taking all such actions requested by the Lender to ensure the continued
perfection of its security interest.  In addition, Borrower shall not
remove any Collateral from the States in which the Borrower is
located.





Section
7.14.Intentionally
Omitted.





Section
7.15.Master
Lease.  The Borrower shall not amend, modify or terminate and
shall maintain those two (2) certain master leases by and between the Borrower,
as landlord, and Tradeport Development IV, LLC, a wholly owned Subsidiary of the
Borrower, as master tenant (collectively, the “Master Lease”) of the entire
Property in full force and effect until the earlier of (i) the Maturity Date; or
(ii) such time as the Lender grants Borrower’s request for Lender’s consent to
release and terminate the Master Lease (the “Master Lease Release
Request”).  The Lender’s consent to a Master Lease Release
Request shall be subject to the satisfaction of the following conditions: (1)
the Property is at least ninety percent (90%) occupied by third party tenants
not affiliated with the Borrower and such tenants have commenced occupancy under
their respective leases and commenced paying rent pursuant to leases permitted
pursuant to, or otherwise approved by, the Lender in accordance with the
Collateral Assignment; (2) the Borrower has provided the Lender with a current
financial statement in accordance with Section 6.01(i) above, (3) the Borrower
has provided financial statements confirming that the projected property
operations at the Property (without taking into consideration the Master Lease)
demonstrate an income which will result in amount equal to or greater than the
Debt Service Coverage Ratio for a full twelve (12) calendar month period with
the prospective year’s net operating income and debt service under the Loan, all
as determined by the Lender in its reasonable discretion; (4) no Event of
Default has occurred or is continuing; (5) there exists no fact or condition
which with the passage of time or giving of notice, or both, would constitute an
Event of Default hereunder or under the Loan Documents; and (6) the Borrower has
satisfied the Master Lease Reserve (as hereinafter defined). Upon
Borrower’s satisfaction








26







of the
foregoing conditions, Lender will approve Borrower’s Master Lease Release
Request in writing whereupon the Master Lease shall be terminated and of no
further force or effect.





Section
7.16.Compliance with
Anti-Terrorism Laws.  Borrower
shall not (1) conduct any business or engage in making or receiving any
contribution of funds, goods or services to or for the benefit of any Prohibited
Person, (2) deal in, or otherwise engage in any transaction relating to, any
property or interests in property blocked pursuant to the Executive Order or any
other Anti-Terrorism Law, or (3) engage in or conspire to engage in any
transaction that evades or avoids, or has the purpose of evading or avoiding, or
attempts to violate, any of the prohibitions set forth in any Anti-Terrorism Law
(and Borrower shall deliver to the Lender any certification or other evidence
requested from time to time by the Lender in its reasonable discretion,
confirming Borrower’s compliance herewith).





ARTICLE
VIII




FINANCIAL
COVENANTS




Until all
of the Obligations have been paid and satisfied in full, unless consent has been
obtained in the manner set forth in Section 11.09
hereof:





Section
8.01.Debt Service Coverage
Ratio.  As of each Fiscal Year end of the Borrower during the
term of the Loan, the Property must maintain a debt service coverage ratio (the
“Debt Service Coverage
Ratio”) of not less than 1.30 to 1, to be determined by Lender in its
reasonable discretion, based upon the net operating income from the Property
(calculated as if all rent under the Master Lease was being paid unless the
Master Lease has been terminated in accordance with Section 7.15) compared to
total debt service under the Loan for such period.





Section
8.02.Intentionally
Omitted.





Section
8.03.Master Lease
Reserve.





(a)           As
a condition precedent to the effectiveness of the Lender’s consent to the
Borrower’s Master Lease Release Request, the Borrower shall deposit the sum of
Three Hundred Thousand and 00/100 Dollars ($300,000.00) (the “Master Lease Reserve Deposit”)
with the Lender into a restricted interest bearing account at the Lender (the
“Master Lease Reserve
Account”).  The Master Lease Reserve Deposit and all monies
deposited or held in the Master Lease Reserve Account shall not constitute a
trust fund and may be commingled with other escrow monies held by
Lender.  The Borrower shall have no ability to withdraw any sums from
the Master Lease Reserve Account except for such disbursements as are authorized
to be made by the Lender as set forth herein.  Borrower shall execute
and deliver to Lender a Pledge Agreement in the form attached hereto as Schedule B whereby
the Borrower shall, inter
alia, pledge, assign and grant a security interest to Lender, as
additional security for the Loan, all of Borrower’s right, title and interest in
and to the Master Lease Reserve Account, the funds contained therein and all
interest earned or accrued thereon, if any.  Upon the occurrence of an
Event of Default hereunder or under any other Loan Documents, Lender may apply
any sums then present in the Master Lease Reserve Account to the payment of the
Loan in any order in its sole








27







discretion.  Except
as set forth herein, the Lender shall retain the Master Lease Reserve (as
hereinafter defined) in the Master Lease Reserve Account.  The Lender
shall disburse the funds from the Master Lease Reserve Account subject to the
terms of Section 8.03(b) below, to fund or reimburse the Borrower for the
Leasing Costs upon presentation of an invoice or paid receipt.  The
Lender shall have no obligation to make any disbursements from the Master Lease
Reserve Account during the continuance of any Event of Default, or if any event
or condition then exists that but for the giving of notice or the passage of
time, or both, would constitute an Event of Default.  Borrower shall
pay all Leasing Costs out of its own funds (not including any advances from the
Loan) during any period in which the Lender is not obligated to release funds
from the Master Lease Reserve Account as hereinbefore provided.





Notwithstanding
anything contained herein to the contrary, in the event that the Borrower is
eligible for, and the Lender does make, a disbursement from the Master Lease
Reserve Account, the Borrower shall make monthly deposits into the Master Lease
Reserve Account (each a “Subsequent Master Lease Reserve
Deposit” and collectively with the Master Lease Reserve Deposit, the
“Master Lease Reserve”)
in an amount equal to the lesser of Twenty Thousand and 00/100 Dollars
($20,000.00) or the amount required to restore the Master Lease Reserve to Three
Hundred Thousand and 00/100 Dollars ($300,000.00).  Such Subsequent
Master Lease Reserve Deposits shall be payable on the first month following any
disbursement from the Master Lease Reserve Account and continuing monthly
thereafter as and when payments of principal and interest are due under the Note
until the balance in the Master Lease Reserve Account is equal to Three Hundred
Thousand and 00/100 Dollars ($300,000.00).





(b)           All
disbursements from the Master Lease Reserve Account shall be subject to the
following additional conditions:





(i)           Upon
ten (10) days prior written request from Borrower and satisfaction of the
requirements set forth in herein, Lender shall disburse amounts from the Master
Lease Reserve Account to reimburse Borrower for the actual Leasing Costs
incurred.  Each request for disbursement from the Master Lease Reserve
Account shall be on a form provided or approved by Lender and shall be submitted
to the Lender together with such invoices, receipts or other information and
additional documentation as Lender may require, in form and substance reasonably
satisfactory to Lender.





(ii)           Lender
shall have no obligation to make any advance if there exists an Event of
Default, or any condition, circumstance or occurrence which but for the giving
of notice or passage of time would constitute an Event of Default or Borrower is
in default under any lease, contract or obligation affecting the
Property.





(iii)           Notwithstanding
anything contained herein to the contrary, Borrower shall not make a request for
disbursement from the Master Lease Reserve Account more frequently than once in
any calendar month.





28
 
   (c)           Notwithstanding
anything contained herein to the contrary, provided (i) no Event of Default has
occurred and is continuing; (ii) there exists no fact or condition which with
the passage of time or giving of notice, or both, would constitute an Event of
Default under the Loan Documents; and (iii) the balance in the Master Lease
Reserve Account is not less than Three Hundred Thousand and 00/100 Dollars
($300,000.00), the Lender shall release all interest earned or accrued on sums
held or maintained in the Master Lease Reserve Account to Borrower upon the
Borrower’s written request to be made not more frequently than once per calendar
quarter.





ARTICLE
IX




NEGATIVE
COVENANTS




Until all
of the Obligations have been paid and satisfied in full, unless consent has been
obtained in the manner set forth in Section 11.09 hereof,
the Borrower shall not:





Section
9.01.Limitations on
Debt.  Create, incur, assume or suffer to exist any Debt
secured by the Collateral except:





(a)            the
Obligations;





(b)            Debt incurred
in connection with the Interest Rate Protection Agreement;





(c)            purchase
money Debt and Capital Leases for equipment secured solely by such equipment,
and other Debt secured by Permitted Liens.





Section
9.02.Limitations on Guaranty
Obligations.  Create, incur, assume or suffer to exist any
Guaranty Obligations secured by or encumbering the Collateral.





Section
9.03.Limitations on
Liens.  Create, incur, assume or suffer to exist, any Lien on
or with respect to the Collateral, whether now owned or hereafter acquired,
except the following (“Permitted
Liens”):





(a)           Liens
for taxes, assessments and other governmental charges or levies (excluding any
Lien imposed pursuant to any of the provisions of ERISA or Environmental Laws)
not yet due or as to which the period of grace, if any, related thereto has not
expired or which are being contested by the Borrower in good faith by
appropriate proceedings and adequate reserves in respect thereof have been
established on the books of the Borrower to the extent required by
GAAP;





(b)           the
claims of materialmen or mechanics or lessors for labor, materials, supplies or
rentals incurred in the ordinary course of business, which are being contested
by the Borrower in good faith and by appropriate proceedings and adequate
reserves in respect thereof have been established on the books of the Borrower
to the extent required by GAAP;





(c)           Liens
consisting of deposits or pledges made in the ordinary course of business in
connection with, or to secure payment of, obligations under workers’






29











(d)           Liens
constituting encumbrances in the nature of zoning restrictions, easements and
rights or restrictions of record on the use of real property, which in the
aggregate are not substantial in amount and which do not, in any case, detract
from the value of the Collateral or impair the use thereof in the ordinary
conduct of business;





(e)           Liens
of the Lender;





(f)           Liens
described on Schedule
9.03(f);





(h)           normal
and customary rights of setoff with respect to deposits of cash in favor of
banks or other depository institutions.





Section
9.04.Intentionally
Omitted.





Section
9.05.Limitations on Mergers and
Liquidation.  Merge, consolidate or enter into any similar
combination with any other Person (unless the Borrower shall be the surviving
entity, providedBorrower has given Lender
reasonable advance notice thereof and such merger or consolidation is not
reasonably expected to result in a Material Adverse Effect) or liquidate,
wind-up or dissolve itself (or suffer any liquidation or
dissolution).





Section
9.06.Limitations on SaleofCollateral.  Convey,
sell, lease, assign, transfer or otherwise dispose of any of the Collateral,
whether now owned or hereafter acquired except:





(a)           the
sale, transfer, lease or other disposition of machinery, parts, equipment and
other assets no longer used in the operation of the Property, so long as the net
proceeds therefrom are used to repair or replace damaged property or to purchase
or otherwise acquire new assets or property;





(b)           leases
or licenses of real, personal or intangible property in the ordinary course of
business, subject to the Collateral Assignment; and





(c)           the
settlement, discount or compromise of receivables which constitute part of the
Collateral in the ordinary course of business in connection with the collection
thereof.





Section
9.07.Intentionally
Omitted.





Section
9.08.Intentionally
Omitted.





Section
9.09.Intentionally
Omitted.






30







Section
9.10.Certain Accounting
Changes.  Change its Fiscal Year end without prior notice
to Lender, or make any change in its accounting treatment and reporting
practices except as required or permitted by GAAP.





Section
9.11.Intentionally
Omitted.





Section
9.12.Transfer of
Property.  A sale, conveyance, or transfer, whether voluntary,
by operation of law or otherwise, of all or any portion of, or interest in, all
or any portion of the Property or the placing of any mortgage, lien or other
encumbrance on the Property without prior written consent of the Lender in each
case.  Notwithstanding the foregoing, the Borrower shall have the
right to obtain a partial release (“Partial Release”) of any
entire parcel comprising a portion of the Property (the “Release Property”) from the
Mortgage and Loan Documents only upon satisfaction of the conditions set forth
below:





(a)           Borrower
must provide not less than thirty (30) days, but not more than one hundred
twenty (120) days, prior written notice to Lender requesting a Partial Release
and identifying the Release Property and date upon which it desires to have the
Release Property released (“Partial Release
Date”).





(b)           No
Event of Default shall have occurred and be continuing at the time Borrower
requests a Partial Release or on the Partial Release Date.





(c)           The
Lender shall order, at the Borrower’s sole cost and expense, an appraisal of
each Property, including, but not limited to, the portion of the Property which
is to be the Release Property.





(d)           As
of the Partial Release Date, and, after giving effect to the Partial Release to
occur on such date, the Debt
Service Coverage Ratio for the remaining Property not released from the
Mortgage shall be not less than 1.30 to 1 as determined by Lender in its
reasonable discretion.





(e)           As
of the Partial Release Date, and after giving effect to the Partial Release to
occur on such date, the loan to value ratio for the remaining Property equals no
more than seventy percent (70%), as determined by Lender in its reasonable
discretion.





(f)           Borrower
shall have delivered to Lender forms of all documents necessary to release the
Release Property from the liens created by the Mortgage and the other Loan
Documents, each in appropriate form required by Applicable Law and otherwise
satisfactory to Lender and its counsel in all respects together with the Release
Fee which shall be applied in reduction of the then outstanding principal
balance of the Loan and the applicable Prepayment Fee.  As used
herein, the term “Release Fee” shall mean one hundred twenty percent (120%) of
the portion of the Loan attributed by the Lender to the Release
Property.  The allocated portion of the Loan with respect to each
entire parcel constituting a portion of the Property shall be determined by the
Lender based upon the Lender’s review and approval, prior to the Partial Release
Date, of the appraisal reports ordered by the Lender in accordance with
subparagraph (c) above.






31







(g)           Borrower
shall have delivered a certificate from an officer of the Borrower certifying
that the requirements set forth above have been satisfied in all material
respects.




(h)           Borrower
has paid all amounts then due and unpaid under the Loan Documents through (and
including) amounts due on the Release Date and in connection with the Partial
Release.





(i)           Lender
shall have received a copy of a deed conveying all of the Borrower’s right,
title and interest in and to the Release Property to an entity other than
Borrower and a letter from Borrower countersigned by a title insurance company
acknowledging receipt of such deed and agreeing to record such deed in the real
estate records of the appropriate recording office in which the Release Property
is located.





(j)           Borrower
agrees to pay all of Lender’s expenses incurred in connection with reviewing and
documenting such Partial Release, which amounts must be paid by Borrower whether
or not the proposed Partial Release is approved or executed.  Upon
Borrower’s failure to pay such amounts, and in addition to Lender’s remedies for
Borrower’s failure to perform, the unpaid amounts shall be added to principal,
shall bear interest at the Default Rate (as defined in the Note) until paid in
full and payment of such amounts shall be secured by the Mortgage and the other
Collateral.





(k)           Notwithstanding
anything contained herein to the contrary, no Partial Release granted by Lender
shall, in any way, impair or affect the lien or priority of the Mortgage
relating to the portion of the Property not included in the Partial Release or
improve the position of any subordinate lienholder with respect thereto, except
to the extent that the obligations hereunder shall have been reduced by the
actual monetary consideration, if any, received by Lender for such Partial
Release.  The Mortgage shall continue as a lien and security interest
on the portion of the Property not included in a Partial Release.





ARTICLE
X


DEFAULT
AND REMEDIES





Section
10.01.Events of
Default.  Each of the following shall constitute an Event of
Default, whatever the reason for such event and whether it shall be voluntary or
involuntary or be effected by operation of law or pursuant to any judgment or
order of any court or any order, rule or regulation of any Governmental
Authority or otherwise:





(a)Default in Payment
Obligations.  Borrower shall fail to pay any principal,
interest, or both, whether by acceleration, maturity or otherwise, of the Loan
when due in accordance with the terms of the Note and the continuation of such
failure beyond any applicable grace period provided therein.





(b)Misrepresentation.  Any
representation or warranty made by the Borrower under this Agreement, any Loan
Document or any amendment hereto or thereto (except those representations and
warranties made as of a date certain and representations and warranties which
are no longer true and correct because of the consummation of a






32











(c)Default in Performance of
Other Covenants and Conditions.  There shall be a default in
the performance or observance of any term, covenant, condition or agreement
contained in this Agreement (other than as specifically provided for otherwise
in this Section
10.01) or any other Loan Document and such default shall continue for a
period of thirty (30) days after notice from Lender and expiration of any cure
period as provided therein provided , however, that if (i) the curing of such
failure cannot be accomplished with due diligence within said period; (ii)
granting an additional period of time within which to cure such failure would
not (I) result in any material impairment of the Collateral, or any portion
thereof, or the Lender’s lien thereon or (II)have a Material Adverse Effect; and (iii)
the Borrower commences to cure such failure promptly upon learning thereof and
thereafter diligently and continuously prosecutes the cure of such failure, then
such period shall be extended for such time as shall be reasonably necessary to
cure such failure; provided further, however, such extended cure period shall
not be applicable to any failure which can be cured by the payment of
money.





(d)Interest Rate Protection
Agreement.  Any default shall occur pursuant to the Interest
Rate Protection Agreement which shall continue beyond any applicable cure
period, including without limitation, if any termination payment shall be due by
Borrower under the Interest Rate Protection Agreement and such amount is not
paid when due and following the expiration of any applicable cure
period.





(e)Material Adverse
Effect.  A Material Adverse Effect shall occur.





(f)Voluntary Bankruptcy
Proceeding.  The Borrower shall (i) commence a voluntary case
or file a petition under any Debtor Relief Law, (ii) consent to or fail to
contest in a timely and appropriate manner any petition filed against it in an
involuntary case under any Debtor Relief Law, (iii) apply for or consent to, or
fail to contest in a timely and appropriate manner, the appointment of, or the
taking of possession by, a receiver, custodian, trustee, or liquidator of itself
or of a substantial part of its property, domestic or foreign, (iv) admit in
writing its inability to pay its debts as they become due, (v) make a general
assignment for the benefit of creditors, or (vi) take any corporate action for
the purpose of authorizing any of the foregoing.





(g)Involuntary Bankruptcy
Proceeding.  A case or other proceeding shall be commenced
against the Borrower or the Master Tenant in any court of competent jurisdiction
seeking (i) relief under any Debtor Relief Law, or (ii) the appointment of a
trustee, receiver, custodian, liquidator or the like for the Borrower for all or
any substantial part of its assets, domestic or foreign, and such case or
proceeding shall continue without dismissal or stay for a period of ninety (90)
consecutive days, or an order granting the relief requested in such case or
proceeding (including an order for relief under any Debtor Relief Law) shall be
entered.





(h)Failure of
Agreements.  This Agreement or any other Loan Document shall,
for any reason (excluding the actions of the Lender), cease to be in full force
and






33





(i)Judgment.  A
judgment or order for the payment of money which causes the aggregate amount of
all such judgments not fully covered by insurance to exceed $250,000 shall be
entered against the Borrower by any court and such judgment or order shall
continue without discharge, stay, proper appeal or posting of an appropriate
bond for a period of ninety (90) days.





(j)Post Closing
Items.  The Borrower shall fail to deliver or satisfy any of
the post closing items set forth on Schedule 10.01(k) hereof within the time
periods set forth on such Schedule 10.01(k).





Section
10.02.Remedies.  Upon
the occurrence and continuation of an Event of Default (after taking into
account any applicable period of notice, grace or cure), the Lender may by
notice to Borrower:




(a)Acceleration.  Declare
the principal of, and interest on, the Loan and the Note at the time outstanding
and all other amounts owed to the Lender under this Agreement or any of the
other Loan Documents and all other Obligations to be forthwith due and payable,
whereupon all of the foregoing shall immediately become due and payable without
presentment, demand, protest or other notice of any kind, all of which are
expressly waived, anything in this Agreement or the other Loan Documents to the
contrary notwithstanding, that upon the occurrence of an Event of Default
specified in Sections 10.01(g) or 10.01(h), all Obligations shall automatically
become due and payable.




(b)Rights of
Collection.  Exercise all of the Lender’s other rights and
remedies under this Agreement, the other Loan Documents and Applicable Law, in
order to satisfy all of the Obligations.




(c)Receiver.  Without
limiting, and in addition to, any other rights, options and remedies the Lender
has under the Loan Documents, the UCC, at law or in equity, upon the occurrence
and continuation of an Event of Default under Section 10.01(a),
Section 10.1(g)
or Section
10.1(h) and the acceleration of the Loan pursuant to Section 10.02 as a
result thereof, the Lender shall have the right to apply for and have a receiver
appointed by a court of competent jurisdiction in any action taken by the Lender
to enforce its rights and remedies in order to manage, protect, preserve, sell
or dispose the Collateral and continue the operation of the Property and to
collect all revenues and profits thereof and apply the same to the payment of
all expenses and other charges of such receivership including the compensation
of the receiver and to the payments as aforesaid until a sale or other
disposition of such Collateral shall be finally made and
consummated.  THE BORROWER HEREBY IRREVOCABLY CONSENTS TO AND WAIVES
ANY RIGHT TO OBJECT TO OR OTHERWISE CONTEST THE APPOINTMENT OF RECEIVER AS








34








PROVIDED
ABOVE.  BORROWER (I) GRANTS SUCH WAIVER AND CONSENT KNOWINGLY AFTER
HAVING DISCUSSED THE IMPLICATIONS THEREOF WITH COUNSEL, (II) ACKNOWLEDGES THAT
(A) THE UNCONTESTED RIGHT TO HAVE A RECEIVER APPOINTED FOR THE FOREGOING
PURPOSES IS CONSIDERED ESSENTIAL BY THE LENDER IN CONNECTION WITH THE
ENFORCEMENT OF ITS RIGHTS AND REMEDIES UNDER THIS AGREEMENT AND THE OTHER LOAN
DOCUMENTS, AND (B) THE AVAILABILITY OF SUCH APPOINTMENT AS A REMEDY UNDER THE
FOREGOING CIRCUMSTANCES WAS A MATERIAL FACTOR IN INDUCING THE LENDER TO MAKE THE
LOAN; AND (III) AGREE TO ENTER INTO ANY AND ALL STIPULATIONS IN ANY LEGAL
ACTIONS, OR AGREEMENTS OR OTHER INSTRUMENTS IN CONNECTION WITH THE FOREGOING AND
TO COOPERATE FULLY WITH THE LENDER IN CONNECTION WITH THE ASSUMPTION AND
EXERCISE OF CONTROL BY THE RECEIVER OVER ALL OR ANY PORTION OF THE
PROPERTY.





Section
10.03.Allocation of Payments After
Exercise of Remedies.  The Lender shall have the right to
accept any payments made with respect to the Loan following acceleration
thereof, regardless of whether the Borrower have received notice of such
acceleration.  Such payment shall not cure any Event of Default,
except that any default interest rate imposed shall be removed, unless and until
all Obligations of the Borrower to the Lender are paid in full.  The
Lender’s acceptance of such payment shall not constitute a waiver of any right
of the Lender nor shall acceptance of such payment constitute an agreement by
the Lender to forbear from seeking collection of the Loan.





Section
10.04.Rights and Remedies
Cumulative; Non-Waiver, etc.  The enumeration of the rights and
remedies of the Lender set forth in this Agreement is not intended to be
exhaustive, and the exercise by the Lender of any right or remedy shall not
preclude the exercise of any other rights or remedies, all of which shall be
cumulative, and shall be in addition to any other right or remedy given
hereunder or under the Loan Documents or that may now or hereafter exist in law
or in equity or by suit or otherwise.  No delay or failure to take
action on the part of the Lender in exercising any right, power or privilege
shall operate as a waiver thereof, nor shall any single or partial exercise of
any such right, power or privilege preclude other or further exercise thereof or
the exercise of any other right, power or privilege or shall be construed to be
a waiver of any Event of Default.  No course of dealing between the
Borrower, the Lender or their respective agents or employees shall be effective
to change, modify or discharge any provision of this Agreement or any of the
other Loan Documents or to constitute a waiver of any Event of
Default.





Section
10.05.Power of
Attorney.  For the purposes of carrying out the provisions and
exercising the rights, remedies, powers and privileges granted by or referred to
in this Section 10.05, the Borrower
hereby irrevocably constitutes and appoints the Lender its true and lawful
attorney-in-fact, with full power of substitution, to execute, acknowledge and
deliver any instruments and do and perform any acts which are referred to in
this Section
10.05, in the name and on behalf of the Borrower provided, however, the
foregoing power of attorney shall be exercisable by the Lender only during the
continuance






35









ARTICLE
XI


MISCELLANEOUS





Section
11.01. Notices.  Unless
otherwise specified herein, all notices hereunder (“Notice”) to any party hereto
shall be in writing and shall be given (a) by certified mail, return receipt
requested, or (b) by nationally recognized overnight courier (e.g., UPS or
Federal Express), or (c) by electronic facsimile transmission (with confirmation
of successful transmission) or by electronic mail (provided, however, that if a
notice is given by facsimile or electronic mail, a copy of such notice shall
also be delivered by one of the other delivery methods set forth in clauses (a),
and (b) above), in each case addressed to such party at its address indicated
below:





(a)           If
to the Borrower:




Frederick
M. Danziger


Griffin
Land & Nurseries, Inc.


One
Rockefeller Plaza


Suite
2301


New York,
NY 10020


Facsimile
No.:  (212) 218-7910


E-mail:
mike.danziger@grifland.com





And





Anthony
Galici


Griffin
Land & Nurseries, Inc.


90 Salmon
Brook Street


Granby,
CT 06035


Facsimile:
(860) 653-1625


E-mail:  agalici@insy.com





With a
copy, to:





Thomas M.
Daniells, Esq.


Murtha
Cullina LLP


CityPlace,
185 Asylum Street


Hartford,
CT  06103


Facsimile
No.: (860) 240-6150


E-mail:  Tdaniells@murthalaw.com






36






(b)           If
to the Lender:





People’s
United Bank


One
Financial Plaza


Hartford,
Connecticut  06103


Attention:
Sean Kenny


Facsimile
No.: (860) 280-2690


E-Mail:
Sean.Kenny@peoples.com





With a
copy to:





John J.
Kindl, Esquire


Pullman
& Comley, LLC


90 State
House Square


Hartford,
Connecticut  06103


Facsimile
No.: (860) 424-4370


E-Mail:
JKindl@pullcom.com





or to any
other address specified by such party in writing.  All such notices,
requests, demands and other communication shall be deemed given upon the earlier
of (i) receipt by the party to whom such notice is directed (or a person of
suitable age and discretion accepting such notice at such address) or (ii)
refusal to accept delivery by the party to whom such notice is directed (or by
such other suitable person).


Section
11.02. Expenses; Indemnity; Release
of Claims.  Except as otherwise provided in this Agreement,
Borrower will (a) pay all reasonable out-of-pocket expenses of the Lender in
connection with (i) the preparation, execution and delivery of this Agreement
and each other Loan Document, whenever the same shall be executed and delivered,
and (ii) the preparation, execution and delivery of any waiver, amendment or
consent by the Lender relating to this Agreement or any other Loan Document,
including reasonable fees and disbursements of legal counsel to the Lender, (b)
pay all reasonable out-of-pocket expenses of the Lender actually incurred in
connection with any enforcement of any rights and remedies of the Lender
under this Agreement after an Event of Default, including consulting with
appraisers, accountants, attorneys and other Persons concerning the nature,
scope or value of any right or remedy of the Lender hereunder or under any other
Loan Document or any factual matters in connection therewith, which expenses
shall include the reasonable fees and disbursements of such Persons, provided,
however, that while no Event of Default exists, Borrower shall not be required
to reimburse the Lender for the costs and expenses of any appraisers,
accountants, attorneys and other Persons, unless otherwise specified herein, and
(c) defend, indemnify and hold harmless the Lender, and its Subsidiaries,
Affiliates, employees, agents, officers and directors (each an Indemnified
Party), from and against any losses, penalties, fines, liabilities, settlements,
damages, costs and expenses, suffered by any such Indemnified Party in
connection with any claim, investigation, litigation or other proceeding
(whether or not the Lender is a party thereto) and the prosecution and defense
thereof, arising out of or in any way connected with this Agreement, any other
Loan Document or the Loan, including reasonable attorney’s and consultant’s
fees, except to the






37











Section
11.03.Set-off.  In
addition to any rights now or hereafter granted under Applicable Law, and not by
way of limitation of any such rights, upon the occurrence and during the
continuance of any Event of Default, the Lender is hereby authorized by Borrower
at any time or from time to time, without notice to the Borrower or to any other
Person, any such notice being hereby expressly waived, to set off and to
appropriate and to apply any and all sums present or in transit to the Operating
Account or the Master Lease Reserve Account against and on account of the
Obligations.





Section
11.04.Governing
Law.  THIS
AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE
STATE OF CONNECTICUT, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF
LAWS.  Any action or proceeding to enforce or defend any rights
under this Agreement or under any agreement, instrument or other document
contemplated hereby or related hereto; directly or indirectly related to or
connected with the Loan or the negotiation, administration or enforcement
thereof; or arising from the debtor/creditor relationship of the Borrower and
the Lender shall be brought either in the Superior Court of Connecticut or the
United States District Court for the District of Connecticut; provided, however,
that any action or suit on this Agreement, the Mortgage or Collateral Assignment
or other collateral agreement securing the Loan may, at Lender’s option, be
brought either in any State or Federal court located within the County in which
the Property securing this Loan is located or any other Connecticut Court
properly having jurisdiction.  The parties hereto agree that any
proceeding instituted in either of such courts shall be of proper venue, and
waive any right to challenge the venue of such courts or to seek the transfer or
relocation of any such proceeding for any reasons.  The parties hereto
further agree that such courts shall have personal jurisdiction over the
parties.  Any judgment or decree obtained in any such action or
proceeding may be filed or enforced in any other appropriate court.





Section
11.05.Consent to Jurisdiction;
Service of Process.





(a)           Borrower
hereby irrevocably consents to the personal jurisdiction of the state and
federal courts located in the State of Connecticut, in any action, claim or
other proceeding arising out of any dispute in connection with this Agreement,
the Note and the other Loan Documents, any rights or obligations hereunder or
thereunder, or the performance of such rights and obligations.





(b)           To
the extent that the Borrower has or hereafter may acquire: (i) any immunity from
jurisdiction of the state or federal courts located in the State of Connecticut
or from any legal process out of any such court (whether through service or
notice, attachment prior to judgment, attachment in aid of execution, execution
or otherwise) with respect to itself or its property, or (ii) any objection to
the laying of the venue or of an inconvenient forum or any suit, action or
proceeding brought in a state or federal court located in the State of
Connecticut, Borrower hereby irrevocably waives such immunity or






38











Section
11.06.Waiver of Jury
Trial;
Commercial Waiver.





(a)           WAIVER OF JURY
TRIAL.  THE BORROWER DOES HEREBY IRREVOCABLY WAIVE ITS RIGHT TO
A JURY TRIAL WITH RESPECT TO ANY ACTION, CLAIM OR OTHER PROCEEDING ARISING OUT
OF ANY DISPUTE IN CONNECTION WITH THIS AGREEMENT, THE NOTE OR THE OTHER LOAN
DOCUMENTS, ANY RIGHTS OR OBLIGATIONS HEREUNDER OR THEREUNDER, OR THE PERFORMANCE
OF SUCH RIGHTS AND OBLIGATIONS.





(b)           COMMERCIAL
WAIVER.  THE BORROWER HEREBY ACKNOWLEDGES THAT THE TRANSACTION
OF WHICH THIS AGREEMENT IS A PART IS A COMMERCIAL TRANSACTION AND WAIVES ITS
RIGHTS TO NOTICE AND HEARING UNDER CHAPTER 903a OF THE CONNECTICUT GENERAL
STATUTES OR BY OTHER APPLICABLE LAW WITH RESPECT TO ANY PREJUDGMENT REMEDY WHICH
THE LENDER OR ANY OTHER HOLDER OF THE OBLIGATIONS MAY DESIRE TO USE RELATING TO
ANY OF THE COLLATERAL.





(c)            Intentionally
Omitted.





Section
11.07.Reversal of
Payments.  To the extent the Borrower makes a payment or
payments to the Lender or the Lender receives any payment or proceeds of the
Collateral which payments or proceeds or any part thereof are subsequently
invalidated, declared to be fraudulent or preferential, set aside and/or
required to be repaid to a trustee, receiver or any other party under any Debtor
Relief Law, state or federal law, common law or equitable cause, then, to the
extent of such payment or proceeds repaid, the Obligations or part thereof
intended to be satisfied shall be revived and continued in full force and effect
as if such payment or proceeds had not been received by the Lender.





Section
11.08.Punitive
Damages.  The Lender and Borrower hereby agree that no such
Person shall have a remedy of punitive or exemplary damages against any other
party to a Loan Document and each such Person hereby waives any right or claim
to punitive or exemplary damages that it may now have or may arise in the future
in connection with any Dispute, whether such Dispute is resolved through
arbitration or judicially.





Section
11.09.Amendments, Waivers and
Consents.  Any term, covenant, agreement or condition of this
Agreement or any of the other Loan Documents (other than the Interest Rate
Protection Agreement, the terms and conditions of which may be amended, modified
or waived by the parties thereto)] may be amended or waived by the Lender, and
any consent may be given by the Lender, if, but only if, such amendment, waiver
or consent is in writing signed by the Lender and, in the case of an amendment,
signed by Borrower.





Section
11.10.Agreement
Controls.  In the event there is a conflict or inconsistency
between this Agreement and any other Loan Document, the terms of this








39







Agreement
shall control; provided, that any provision of the Security Documents which
imposes additional burdens on the Borrower or further restricts the rights of
the Borrower or gives the Lender additional rights shall not be deemed to be in
conflict or inconsistent with this Agreement and shall be given full force and
effect.





Section
11.11.Survival.  Notwithstanding
any termination of this Agreement, the indemnities to which the Lender is
entitled under the provisions of this Article XIand any
other provisions of this Agreement and the Loan Documents shall continue in full
force and effect and shall protect the Lender against events arising after such
termination as well as before.





Section
11.12.Counterparts.  This
Agreement may be executed in any number of counterparts and by the different
parties hereto in separate counterparts, each of which when so executed shall be
deemed to be an original and all of which taken together shall constitute one
and the same agreement.  Delivery of an executed counterpart of a
signature page to this Agreement by telecopier, facsimile or other electronic
means shall be as effective as delivery of a manually executed counterpart of
this Agreement.The
signature of any party on this Agreement by telecopier, facsimile or other
electronic means is to be considered as an original signature, and the document
transmitted is to be considered to have the same binding effect as an original
signature on an original document.  At the request of any party, any
telecopier, facsimile or other electronic signature is to be re-executed in
original form by the party which executed the telecopier, facsimile or other
electronic signature.  No party may raise the use of a telecopier,
facsimile machine or other electronic means, or the fact that any signature was
transmitted through the use of a telecopier, facsimile machine or other
electronic means, as a defense to the enforcement of this
Agreement.





Section
11.13.Headings.  Titles
and captions of Articles, Sections and subsections in this Agreement are for
convenience only, and neither limit nor amplify the provisions of this
Agreement.





Section
11.14.Severability.  Any
provision of this Agreement or any other Loan Document which is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
only to the extent of such prohibition or unenforceability without invalidating
the remainder of such provision or the remaining provisions hereof or thereof or
affecting the validity or enforceability of such provision in any other
jurisdiction.





Section
11.15.Entirety.  This
Agreement together with the other Loan Documents represents the entire agreement
of the parties hereto and thereto, and supersedes all prior agreements and
understandings, oral and written, if any, including any commitment letters or
correspondence relating  to the Loan Documents or the transactions
contemplated herein or therein.





Section
11.16.Termination.  This
Agreement shall remain in effect from the date hereof through and including the
date upon which all Obligations shall have been paid and satisfied in
full.  The Lender shall release all Liens on the Collateral in favor
of the






40








Section
11.17.No Commitment to Extend or
Refinance.  The Borrower acknowledges that it is the Borrower’s
responsibility to pay the Loan as required hereunder.  The Lender is
under no obligation to extend the maturity date of, or refinance, the Loan, or
except with respect to the provision of Future Tranches which are provided for
herein, to provide additional financing to the Borrower.  The Borrower
acknowledges that, as of the date hereof, the Lender has not made any commitment
or representations pertaining to the further extension or refinancing of the
Loan or except with respect to the provision of Future Transactions which are
subject to the term hereof, the provision of additional financing to the
Borrower.  The Borrower further acknowledges that no oral
representations or commitments by the Lender or any officer or employee thereof
pertaining to the further extension or refinancing of the Loan or the provision
of additional financing shall be binding upon the Lender.





Section
11.18.Assignment;
Participation.  The Lender reserves the right to assign all or
any portion of all or any Loan to other lenders (with a corresponding reduction
in Lender’s share of such Loan) or to participate out all or any portion of the
Loan.  The Borrower hereby grants to the Lender the right to
distribute to potential investors, assignees and participants, without further
notice to the Borrower, and at the Lender’s sole discretion, any information
relative to the Borrower, including, but not limited to, preliminary budgets,
pro forma statements and financial statements.  The rights conferred
upon the Lender by this Agreement shall be automatically extended to and vested
in any assignee or transferee of the Lender upon the Borrower’s receipt of
notice of such assignment or transfer; provided, however, that no such
assignment or transfer shall enlarge the obligations of the Borrower
hereunder.





Section
11.19.Exculpation.  Notwithstanding
anything contained herein to the contrary, the provisions of Section 20 of the
Note which limit recourse of the Obligations against the Borrower are hereby
incorporated by reference to the fullest extent as if the text of such Section
were set forth in its entirety herein.





[No
Further Text On This Page – Signature Page Follows]


41


IN WITNESS WHEREOF, the
parties hereto have caused this Agreement to be executed under seal by their
duly authorized officers, all as of the day and year first written
above.








LENDER:PEOPLE’S
      UNITED BANK/s/
      John J. Kindl
            
            By:
      /s/ Sean M.
      KennyJohn
      J. Kindl
            
            Sean
      M. Kenny, Vice President/s/
      Brian J. KirschBrian
      J. Kirsch








BORROWER:GRIFFIN
      LAND & NURSERIES, INC.,a
      Delaware corporation/s/
      Frank J. Saccomandi, III
            
            By:
      /s/Anthony J.
      GaliciFrank
      J. Saccomandi, III
            
            Its
      Vice PresidentDuly
      Authorized/s/
      John J. KindlJohn
      J. Kindl














42





STATE
      OF CONNECTICUT
            ))
            ss:
            HartfordCOUNTY
      OF HARTFORD
            )





On this
the 9th day of July, 2009, before me, the
undersigned officer, personally appeared Sean M. Kenny, who
acknowledged himself to be the Vice President of PEOPLE’S UNITED BANK, a
federally chartered savings bank, and that he as such and being duly authorized
so to do, executed the foregoing instrument for the purposes therein contained
by signing the name of the federally chartered savings bank by himself as such
Vice President.




IN WITNESS WHEREOF, I hereunto
set my hand.









/s/
      John J. KindlJohn
      J. KindlCommissioner
      of the Superior Court





















STATE
      OF CONNECTICUT
            ))
            ss:
            HartfordCOUNTY
      OF HARTFORD
            )





On this
the 9th day of July, 2009, before me, the
undersigned officer, personally appeared Anthony J. Galici, who
acknowledged himself to be the Vice President of GRIFFIN LAND & NURSERIES,
INC., a Delaware corporation and that he as such and being authorized so
to do, executed the foregoing instrument for the purposes therein contained by
signing the name of the corporation by himself as such Vice
President.




IN WITNESS WHEREOF, I hereunto
set my hand.







/s/
      Frank J. Saccomandi, IIIFrank
      J. Saccomandi, IIICommissioner
      of the Superior Court





43


SCHEDULE
5.01(c)


COMPLIANCE
OF AGREEMENT, LOAN DOCUMENTS


AND
BORROWING WITH LAWS, ETC








NONE


44


SCHEDULE
5.01(d)


COMPLIANCE
WITH LAW; GOVERNMENTAL APPROVALS; OTHER CONSENTS AND APPROVALS





NONE







45


SCHEDULE
5.01(g)


ENVIRONMENTAL
MATTERS





All
matters set forth in the following Reports:





DATE
            TITLE
            PREPARED
      BY
            PREPARED
      FORMay
      2009
            Phase
      I Environmental Assessment
              14,
      15, 16 & 40 International Drive,
              East
      Granby/Windsor, Connecticut
              (GeoQuest
      project #1564)
            GeoQuest
            Griffin
      Land
              and
              People’s
      United
              BankJune
      11, 1999
            Potable
      Drinking Water Well Sampling
              New
      England Tradeport
              14,
      15 & 16 International Drive
              East
      Granby, CT 06026
              (Hygenics
      Project No. 1340.027)
            Hygenics
              Environmental
              Services,
      Inc.
            GE
      Capital Real EstateApril
      14, 1999
            Phase
      I Environmental Site Assessment Report
              New
      England Tradeport
              14
      International Drive
              East
      Granby, CT 06026
              (Project
      #3176.034)
            Hygenics
              Environmental
              Services,
      Inc.
            GE
      Capital Real EstateApril
      14, 1999
            Phase
      I Environmental Site Assessment Report
              New
      England Tradeport
              15
      International Drive
              East
      Granby, CT 06026
              (Project
      #3176.034)
            Hygenics
              Environmental
              Services,
      Inc.
            GE
      Capital Real EstateApril
      14, 1999
            Phase
      I Environmental Site Assessment Report
              New
      England Tradeport
              16
      International Drive
              East
      Granby, CT 06026
              (Project
      #3176.034)
            Hygenics
              Environmental
              Services,
      Inc.
            GE
      Capital Real EstateAugust
      17, 1994
            Revised
      Phase I Environmental Site
              Assessment
      at 14, 15 & 16 International Drive
              East
      Granby, Connecticut
              (HRP
      #CEN-0219.P1)
            HRP
      Associates, Inc.
            CenterbankMay
      6, 1999
            Letter
      from David Platt, Esq. of Murtha
              Cullina
      Richter and Pinney, LLP to Sandra P.
              Wooten,
      Access Operations Manager of GE
              Capital
      Corporation
            Murtha
      Cullina
              Richter
      and
              Pinney,
      LLP
            Griffin
      Land &
              Nurseries,
      Inc.








46


SCHEDULE
5.01(q)








EXCEPTIONS
TO DEBT AND GUARANTY


OBLIGATIONS
COMPLIANCE








Griffin
Center Development IV, LLC (“GCD IV”) and Griffin Center Development V, LLC
(“GCD V”) are the borrowers under a mortgage loan from Webster
Bank.  Griffin Land & Nurseries, Inc. is the sole member of these
LLCs.  The office buildings at 5 and 7 Waterside Crossing, Windsor,
Connecticut are the mortgaged property for that loan.  Under the terms
of the Webster Bank mortgage, as amended, the aforesaid properties must maintain
a debt service coverage ratio of 1.0x for the twelve months ended December 31,
2009 (the debt service coverage ratio for the prior twelve month period was
waived).





Based on
current projections, the properties will most likely not be able to achieve the
required debt service coverage ratio for the twelve months ended December 31,
2009.




47


SCHEDULE
5.01(r)


LITIGATION








The
Internal Revenue Service is currently conducting a routine examination of the
Borrower’s federal income tax returns for the Borrower’s Fiscal Years 2004, 2005
and 2006.  The Borrower has no reason to believe that the result of
such examination will have a Material Adverse Effect.

















48





SCHEDULE
9.03(f)


LIENS











I.
            Liens
      on the 14 International Drive
Property





a.
            Gas
      service easement in favor of The Connecticut Light and Power Company dated
      December 16, 1977 and recorded in Volume 59 at Page 122 of the East Granby
      Land Records; assigned to Yankee Gas Services Company by Assignment dated
      and recorded June 30, 1989 in Volume 86 at Page 630 of the East Granby
      Land Records.





b.
            Electric
      distribution easement in favor of The Hartford Electric Light Company
      dated Marcy 27, 1978 and recorded in Volume 59 at Page 347 of the East
      Granby Land Records.





c.
            Electric
      distribution easement in favor of The Hartford Electric Light Company
      dated June 1, 1979 and recorded in Volume 61 at Page 373 of the East
      Granby Land Records.





d.
            Declaration
      of Covenants and Restrictions/Easements of Use and to Use made by Culbro
      Land Resources, Inc. dated and recorded January 17, 1986 in Volume 74 at
      Page 121 of the East Granby Land Records; amended by Amendment dated April
      23, 2002 and recorded May 7, 2002 in Volume 134 at Page 568 of the East
      Granby Land Records.





e.
            Declaration
      of Easement for Right of Way and Drainage made by Culbro Land Resources,
      Inc. dated September 20, 1983 and recorded in Volume 68 at Page 727 of the
      East Granby Land Records.





f.
            Boundary
      Line Agreement made by Griffin Land & Nurseries, Inc. dated April 23,
      2002 and recorded May 7, 2002 in Volume 134 at Page 571 of the East Granby
      Land Records.





g.
            Conditions
      of State Traffic Commission Report No. 170-0812-01 dated October 28, 2008
      and recorded January 5, 2009 in Volume 176 at Page 378 of the East Granby
      Land Records and in Volume 1650 at Page 599 of the Windsor Land
      Records.





h.
            Conditions
      and Requirements of State Traffic Commission Certificate No. 813-B dated
      January 6, 2003 and recorded January 12, 2009 in Volume 176 at 467 of the
      East Granby Land Records and in Volume 1651 at Page 28 of the Windsor Land
      Records.





49







II.
            Liens
      on the 15 International Drive
Property





a.
            Gas
      service easement in favor of The Connecticut Light and Power Company dated
      December 16, 1977 and recorded in Volume 59 at Page 122 of the East Granby
      Land Records; assigned to Yankee Gas Services Company by Assignment dated
      and recorded June 30, 1989 in Volume 86 at Page 630 of the East Granby
      Land Records.





b.
            Electric
      distribution easement in favor of The Hartford Electric Light Company
      dated March 27, 1978 and recorded in Volume 59 at Page 347 of the East
      Granby Land Records.





c.
            Electric
      distribution easement in favor of The Hartford Electric Light Company
      dated June 1, 1979 and recorded in Volume 61 at Page 373 of the East
      Granby Land Records.





d.
            Declaration
      of Covenants and Restrictions/Easements of Use and to Use made by Griffin
      Land & Nurseries, Inc. dated May 6, 1999 and recorded May 14, 1999 in
      Volume 121 at Page 374 of the East Granby Land
  Records.





e.
            Conditions
      of State Traffic Commission Report No. 170-0812-01 dated October 28, 2008
      and recorded January 5, 2009 in Volume 176 at Page 378 of the East Granby
      Land Records and in Volume 1650 at Page 599 of the Windsor Land
      Records.





f.
            Conditions
      and Requirements of State Traffic Commission Certificate No. 813-B dated
      January 6, 2003 and recorded January 12, 2009 in Volume 176 at 467 of the
      East Granby Land Records and in Volume 1651 at Page 28 of the Windsor Land
      Records.





50





III.
            Liens
      on the 16 International Drive
Property





a.
            Gas
      service easement in favor of The Connecticut Light and Power Company dated
      December 16, 1977 and recorded in Volume 59 at Page 122 of the East Granby
      Land Records; assigned to Yankee Gas Services Company by Assignment dated
      and recorded June 30, 1989 in Volume 86 at Page 630 of the East Granby
      Land Records.





b.
            Electric
      distribution easement in favor of The Hartford Electric Light Company
      dated May 27, 1978 and recorded in Volume 59 at Page 347 of the East
      Granby Land Records.





c.
            Electric
      distribution easement in favor of The Hartford Electric Light Company
      dated June 1, 1979 and recorded in Volume 61 at Page 373 of the East
      Granby Land Records.





d.
            Declaration
      of Covenants and Restrictions/Easements of Use and to Use made by Griffin
      Land & Nurseries, Inc. dated May 6, 1999 and recorded May 14, 1999 in
      Volume 121 at Page 387 of the East Granby Land
  Records.





e.
            Declaration
      of Easement for Right of Way and Drainage made by Culbro Land Resources,
      Inc. dated September 20, 1983 and recorded in Volume 68 at Page 727 of the
      East Granby Land Records.





f.
            Easement
      Agreement by and between River Bend Associates, Inc. and Griffin Land
      & Nurseries, Inc. dated April 23, 2002 and recorded May 7, 2002 in
      Volume 134 at Page 574 of the East Granby Land
  Records.





g.
            Conditions
      of State Traffic Commission Report No. 170-0812-01 dated October 28, 2008
      and recorded January 5, 2009 in Volume 176 at Page 378 of the East Granby
      Land Records and in Volume 1650 at Page 599 of the Windsor Land
      Records.





h.
            Conditions
      and Requirements of State Traffic Commission Certificate No. 813-B dated
      January 6, 2003 and recorded January 12, 2009 in Volume 176 at 467 of the
      East Granby Land Records and in Volume 1651 at Page 28 of the Windsor Land
      Records.





IV.
            Liens
      on the 40 International Drive
Property





a.
            Slope
      Rights granted by Culbro Corporation to the Town of Windsor in a deed
      dated August 3, 1994 and recorded August 11, 1994 in Volume 1014 at Page
      315 of the Windsor Land Records.






51





b.
            Conditions
      of Special Use Permit granted by the Windsor Town Plan and Zoning
      Commission dated August 17, 1999 and recorded August 20, 1999 in Volume
      1206 at Page 173 of the Windsor Land
Records.





c.
            Conditions
      of State Traffic Commission Report No. 170-0812-01 dated October 28, 2008
      and recorded January 5, 2009 in Volume 176 at Page 378 of the East Granby
      Land Records and in Volume 1650 at Page 599 of the Windsor Land
      Records.





d.
            Conditions
      and Requirements of State Traffic Commission Certificate No. 813-B dated
      January 6, 2003 and recorded January 12, 2009 in Volume 176 at 467 of the
      East Granby Land Records and in Volume 1651 at Page 28 of the Windsor Land
      Records.

















52


SCHEDULE 10.01(k)


POST
CLOSING ITEMS





ITEM
            DELIVERY
      DATE


53


SCHEDULE
A





Note






54


SCHEDULE
B





Pledge
and Control Agreement



















55