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                                                                   Exhibit 10.19


                             OPERATING AGREEMENT OF
                       PARSIPPANY OFFICE ASSOCIATES L.L.C.
                     A NEW JERSEY LIMITED LIABILITY COMPANY


                  This OPERATING AGREEMENT OF PARSIPPANY OFFICE
ASSOCIATES L.L.C., a New Jersey limited liability company, (this "Agreement") is
made and entered into as of December 28,1999, by and between MACK-CALI REALTY,
L.P., a Delaware limited partnership ("MC") as the Managing Member (as the
Managing Member may be changed or replaced from time to time hereunder, the
"Managing Member") and SLAB INVESTMENTS HOLDING, INC., a Delaware corporation
("SLAB") as a Member (each of MC and SLAB is sometimes referred to herein as a
"Member" and collectively as the "Members").

                  1. FORMATION/GOVERNING LAW. This limited liability company
("Company") shall be formed and established as a limited liability company as
of the date hereof, pursuant to the provisions of the New Jersey Limited
Liability Company Law, NJSA 42 ET SEQ. (the "Act"). This Agreement shall be
governed by New Jersey law.

                  2. NAME. The name of the Company shall be PARSIPPANY OFFICE
ASSOCIATES L.L.C.

                  3. CERTIFICATES. On December 17, 1999, a Certificate of
Formation (the "Certificate") was filed in the Office of the Secretary of State
of New Jersey.

                  4. PRINCIPAL PLACE OF BUSINESS. The principal place of
business of the Company shall be at c/o Mack-Cali Realty Corporation, 11
Commerce Drive, Cranford, New Jersey 07016, or at such other place(s) in New
York or New Jersey as may be designated from time to time by the Managing
Member.

                  5. OFFICE AND AGENTS. The name and address of the registered
agent for service of process on the Company in the State of New Jersey shall be
Corporation Service Company, 830 Bear Tavern Road, West Trenton, New Jersey
08628. The Managing Member in its reasonable discretion and upon notice to the
other Member may change the agent specified in this Section 5 of this Agreement.

                  6. PURPOSES OF COMPANY. The purpose of the Company shall be to
acquire for investment purposes, and own, finance, refinance, sell, assign or
otherwise dispose of, the investment entities described in Section 9 below
(each, together with any other entity that is owned by the Company, an
"Investment Entity" and collectively, the "Investment Entities"), owning the
Properties (as


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defined in Section 9 below) and other assets related thereto. The purposes of
the Company shall include any and all other general business activities
incidental or reasonably related to the foregoing.

                  7. TERM. The term of the Company shall begin on the date the
Certificate is filed with the Secretary of State of New Jersey and shall
continue until December 31, 2029, unless the term of the Company is extended by
an amendment to this Agreement so stating and executed by each of the Members,
or unless the Company is sooner terminated or liquidated in accordance with the
provisions of the Act or this Agreement. The Company's business shall be
terminated, and the Company shall be liquidated, upon the bankruptcy of any
Member unless a majority in interest of the remaining Members elect in writing,
by notice to all Members given within ninety (90) days thereafter, to
reconstitute the Company and continue its business, which right of election is
hereby granted to them. Notwithstanding any provision to the contrary contained
herein, the Company's business shall be terminated, and the Company shall be
liquidated, in the event the Company no longer owns any interest in any
Investment Entity or all Investment Entities have disposed of the Properties and
no longer own any interest therein.

                  8. RELATIONSHIP OF PARTIES. This Agreement shall be construed
and deemed to create a limited liability company. Nothing herein contained shall
be considered to constitute any Member as the agent of any other Member, except
as may be specifically authorized and provided for herein.

                  9. CAPITAL CONTRIBUTIONS. At the closing ("Closing") under the
Purchase Agreement (as defined below in this Section 9), the Members shall
contribute, as their respective capital contributions ("Capital Contributions")
to the Company, the amounts set forth on Exhibit A (in the respective
proportions stated on Exhibit A) in connection with the Company's purchase of
100% of the membership interests in the following Investment Entities pursuant
to that certain Agreement of Sale and Purchase dated as of even date herewith
("Purchase Agreement"): Mack- Cali Campus Realty L.L.C, a New Jersey limited
liability company, and Mack-Cali Morris Realty L.L.C., a New Jersey limited
liability company. Such Investment Entities own the parcels of real property and
the leasehold interest described on Exhibit B attached hereto (each such real
property, together with any related leasehold interest, a "Property" and
collectively the "Properties", including all improvements thereon and the
personal property related thereto that is owned by the applicable Investment
Entity). Each Member hereby acknowledges and agrees that all costs and expenses
(including without limitation, attorneys' fees and costs) incurred by such
Member in connection with this Agreement and (solely as a Member of the Company)
the Purchase Agreement, the Management Agreement and the Asset Management
Agreement (as such terms are defined in Section 11) shall be borne by such
Member.

        Except as specifically set forth in this Section 9 or elsewhere in this
Agreement or agreed to separately in writing by all of the Members or required
by law, (i) none of the Members shall be required or entitled to make any
additional capital contributions to the Company, to make loans to the Company,
to provide any financing to the Company, or to cause any financing to be made
available to


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the Company, (ii) the Members shall not have any further liability to contribute
money to or in respect of the liabilities or obligations of the Company, and
(iii) the Members shall not be liable for any liabilities of the Company. All
additional capital contributions will require the approval of both Members
(which approval may be withheld in each Member's sole and absolute discretion)
and shall be funded by the Members PARI PASSU in their respective Funding
Proportions shown on Exhibit A. In the event the Managing Member determines that
additional funds are necessary for ordinary and reasonable business purposes of
the Company, any Investment Entity or any Property but additional capital
contribution for such funds is not approved by both Members and the Managing
Member decides to lend such funds (which the Managing Member may but shall not
be required to do), the Managing Member shall provide notice to the other Member
that the Managing Member intends to lend such funds to the Company as a loan.
Within 5 days after receiving such notice from the Managing Member, the other
Member shall have the right to participate in such loan in an amount equal to
such member's respective Funding Proportion multiplied by the amount of such
funds by providing notice thereof (setting forth the percentage of such funds
the other Member elects to lend) to the Managing Member. Failure to provide such
notice by the other Member to the Managing Member shall be deemed an election by
the other Member not to participate, and the Managing Member shall fund the
entire loan within 5 days after the other Member's failure to provide such
notice. If such a notice is timely given by the other Member to the Managing
Member, within 5 days thereafter, the other Member shall fund the percentage of
the loan set forth in such notice and the Managing Member shall fund the
remainder of the loan. The loans made by the Members to the Company in
accordance with this paragraph shall accrue interest at LIBOR plus 200 basis
points per annum, compounded monthly, from the date such loans are made until
repaid by the Company.

         As used in this Agreement, "LIBOR" shall mean, with respect to each
LIBOR Reference Period, the rate (expressed as a percentage per annum) for
deposits in U.S. dollars, for a one-month period, that appears on Telerate Page
3750 (or the successor thereto) as of 11:00 a.m., London, England time, on the
related LIBOR Determination Date. If such rate does not appear on Telerate Page
3750 as of 11:00 a.m., London, England time, on such LIBOR Determination Date,
LIBOR shall the arithmetic mean of the offered rates (expressed as a percentage
per annum) for deposits in U.S. dollars for a one-month period that appear on
the Reuters Screen LIBOR Page as of 11:00 a.m., London, England time, on such
LIBOR Determination Date, if at least two such offered rates so appear. If fewer
than two such offered rates appear on the Reuters Screen LIBOR Page as of 11:00
a.m., London, England time, on such LIBOR Determination Date, SLAB shall request
the principal London, England office of each of any four major reference banks
in the London interbank market selected by SLAB to provide such bank's offered
quotation (expressed as a percentage per annum) to prime banks in the London
interbank market for deposits in U.S. dollars for a one-month period as of 11:00
a.m., London, England time, on such LIBOR Determination Date for amounts
approximately equal to SLAB Return Amount. If at least two such offered
quotations are so provided, LIBOR shall be the arithmetic mean of such
quotations. If fewer than two such offered quotations are so provided, SLAB
shall request each of any three major banks in New York City selected by SLAB to
provide such bank's rate (expressed as a percentage per annum) for loans in U.S.
dollars to leading European


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banks for a one-month period as of approximately 11:00 a.m., New York City time,
on the applicable LIBOR Determination Date for amounts approximately equal to
the SLAB Return Amount. If at least two such rates are so provided, LIBOR shall
be the arithmetic mean of such rates. If fewer than two such rates are so
provided, then LIBOR for the applicable LIBOR Reference Period shall be LIBOR as
in effect for the next preceding LIBOR Reference Period. LIBOR shall be
determined in accordance with this paragraph by SLAB or its designee.
Notwithstanding the foregoing, LIBOR for the period commencing on the date
hereof and ending January 5, 2000 shall be 6.49% per annum.

         As used herein, the term "LIBOR Business Day" shall mean any Business
Day on which commercial banks in the City of London, England, are open for
interbank or foreign exchange transactions.

         As used herein, the term "LIBOR Determination Date" shall mean, with
respect to any LIBOR Reference Period, the date that is two (2) LIBOR Business
Days prior to the first day of such LIBOR Reference Period.

         As used herein, the term "LIBOR Reference Period" shall mean, (i)
initially, the period commencing on the date of this Agreement for the
Guaranteed Payments and the loan funding date for the Member loans and ending on
the first occurring fifth (5th) day of a calendar month thereafter, and (ii)
thereafter, a period commencing on the sixth (6th) day of such calendar month
and ending on the fifth (5th) day of the following calendar month.

                  10. CAPITAL ACCOUNTS. An individual capital account shall be
maintained for each Member, and tax allocations made pursuant to this Agreement
shall be made, in accordance with applicable Treasury Regulations under Section
704 of the Internal Revenue Code of 1986, as amended ("Code"). The Managing
Member shall be the "Tax Matters Partner" of the Company and shall be
responsible for filing the tax returns of the Company on a timely basis (but no
later than May 15 of each year). The Managing Member shall be responsible for
complying with any and all reporting requirements on behalf of the Company,
including those set forth on Exhibit D. All tax decisions, tax returns and
settlements with taxing authorities shall be subject to the reasonable approval
of both Members.

                  11. POWERS AND RESPONSIBILITIES OF THE MEMBERS; PROPERTY
MANAGEMENT; ASSET MANAGEMENT FEE; SALE RIGHTS; INDEMNITY.

         (a) Subject to the approval rights of the Members under Sections 11(b)
and 11(c) and the sale and financing rights of the Members under Section 11(d),
and except as otherwise provided herein, the then Managing Member shall have all
of the rights, power and authority of a manager in a limited liability company
under the Act and the management and operation of the affairs, activities and
business of the Company shall be vested exclusively in the Managing Member. The
Members hereby authorize the Managing Member to execute all documents and to
take all actions as may be necessary or


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desirable on behalf of the Company which are consistent with the Company's
purposes, any major decisions approved by the Members under Section 11(b) or
11(c), and any sale or financing decisions made by the applicable Member under
Section 11(d). The Members hereby approve the budgets attached hereto as Exhibit
E with respect to the Properties (the "Current Budgets") and, subject to the
approval rights and the restrictions contained elsewhere in this Agreement, the
Managing Member may cause the Investment Entities to make the expenditures
described in the Current Budgets (as the same may be modified from time to time
by the Managing Member in the exercise of its commercially reasonable business
judgment, which modifications, in each instance and in the aggregate, shall not
increase the total expenses set forth in the Current Budgets by more than 10% to
pay expenditures reasonably required with respect to the Property and provided
that such increased expenditures do not prevent the Guaranteed Payments from
being made to SLAB under Section 13(c)(1)). The Members also hereby approve that
certain Leasing and Management Agreement dated as of December 28, 1999
(collectively, the "Management Agreement") with respect to the Properties and
that certain Asset Management Agreement dated as of December 28, 1999 ("Asset
Management Agreement") with respect to the Investment Entities and the
Properties.

         MC shall be the Managing Member until the earlier to occur of the
following: (i) MC is removed as the Managing Member under Section 11(e); or (ii)
a majority in Residual Percentages (as set forth in Exhibit A) of the Members
elects to remove MC as the Managing Member by providing written notice thereof
to MC at any time after January 2, 2001.

         (b) Subject to the provisions of Section 11(d) but notwithstanding any
other provision to the contrary herein, so long as MC is the Managing Member,
the following actions and matters are major decisions requiring the reasonable
(except as otherwise provided) written approval of the Members (whether in
advance in a business plan, budget, or other pre-approval, or at the time of the
action in question, as the case may be):

                  (i) Entering into, approving, terminating or modifying to any
         material extent the Management Agreement or the Asset Management
         Agreement (SLAB may withhold its approval to the foregoing actions and
         matters in this clause (i) in its sole and absolute discretion), or
         selecting any architect, engineer, broker, leasing agent, property
         manager, marketing or other consultant, contractor or sales agent for
         any Property, any Investment Entity or the Company who are not
         currently providing services to the Investment Entities or the Company
         or in connection with the Properties in the ordinary course of
         business;

                  (ii) Terminating or modifying to any material extent the
         insurance policies currently maintained by the Investment Entities with
         respect to the Properties);

                  (iii) Terminating any leases at any Property (except by reason
         of a material breach of a tenant thereunder), or entering into,
         approving or modifying to any material extent any lease at any
         Property, in each case which is for either more than 25% of the total
         leaseable space of


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         the building at issue or more than 40,000 square feet of leaseable
         space. All new leases shall be on such terms and conditions which are
         not less favorable to the landlord than those of similar leases entered
         into at arm's length between unrelated parties for comparable leases of
         space in the area where the Properties are located;

                  (iv) Causing or permitting the Company or any Investment
         Entity to file for bankruptcy or other relief from creditors, including
         without limitation, an assignment for the benefit of creditors, an
         admission in writing by any such entity of its inability to pay its
         debts generally as they become due, causing the Company, a Member's
         membership interest in the Company, any Investment Entity, the
         Company's membership interest in any Investment Entity, or any Property
         or any part thereof or interest therein to be subject to the authority
         of any trustee, custodian or receiver or to be subject to any
         proceeding for bankruptcy, insolvency, reorganization, arrangement,
         readjustment of debt, relief of debtors, dissolution or liquidation or
         similar proceedings (collectively and singly, "Bankruptcy Action")
         (SLAB may withhold its approval to all actions and matters in this
         clause (iv) in its sole and absolute discretion);

                  (v) Making any distributions except as permitted hereunder, or
         establishing reserves with respect to a Property in excess of 10% of
         the annual cash flow from such Property or releasing funds therefrom
         except in accordance with this Agreement and the reasonable needs of
         the Company's business (SLAB may withhold its approval to all actions
         and matters in this clause (v) in its sole and absolute discretion);

                  (vi) Dissolving, terminating or liquidating the Company or any
         Investment Entity, or redeeming any interest of any Member, except as
         provided herein (SLAB may withhold its approval to all actions and
         matters in this clause (vi) in its sole and absolute discretion);

                  (vii) Entering into, approving, terminating or modifying the
         terms of any contracts, agreements, leases and other undertakings with
         any Member or its affiliates (SLAB may withhold its approval to the
         foregoing actions and matters in this clause (vii) in its sole and
         absolute discretion); PROVIDED, HOWEVER, that entering into, approving,
         terminating or modifying to any material extent any service contracts
         and other contracts and agreements (not otherwise specifically
         addressed herein) with non-affiliates shall be permitted without any
         Member approval so long as such contracts are entered into for
         reasonable business purposes of the Company or the Investment Entities
         on bona fide market terms and conditions for comparable goods or
         services and for the area where the Properties are located.
         Notwithstanding anything to the contrary contained in this Agreement,
         to the extent any affiliate of MC is now or hereafter becomes a party
         to any contract, agreement, lease or other undertaking entered into
         with the Company or any Investment Entity (including without
         limitation, the Purchase Agreement, the post-closing agreements in
         connection therewith, the Management Agreement and the Asset Management
         Agreement), SLAB, acting alone, shall have the exclusive right and
         authority on behalf of the Company (A) to exercise termination rights
         in accordance with the terms of such


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         document, (B) to enforce and defend the Company's or the applicable
         Investment Entity's rights (including without limitation, right to seek
         damages for breach of representations and warranties and enforce
         indemnities) under such document (including by prosecution or defense
         of any proceeding or action that it deems necessary or appropriate),
         and (C) to retain Company or Investment Entity counsel of its choosing
         in connection with the foregoing at MC's expense. MC shall disclose to
         SLAB in writing whether any party to a proposed contract, agreement,
         lease or other undertaking to be entered into with the Company or any
         Investment Entity is an affiliate of MC promptly after MC becomes aware
         of such relationship and such proposed contract, agreement, lease or
         other undertaking, and, in any event (and without limiting the
         foregoing), prior to the Company's or such Investment Entity's
         execution of the same. As used in this Agreement, an "affiliate" of a
         Member shall mean any other individual, corporation, limited liability
         company, partnership, trust, association or other entity or
         organization directly or indirectly controlling, controlled by or under
         common control with such Member. The term "control" or derivatives of
         same shall mean direct or indirect ownership of more than 50% and/or
         possession of the power to direct the management policies;

                  (viii) Acquiring, selling, conveying, exchanging,
         hypothecating, pledging, encumbering or otherwise transferring all or
         any portion of or any interest in any Property or Investment Entity
         (other than pursuant to Section 11(d)), or in any other real property
         now or hereafter owned by the Company or any Investment Entity (SLAB
         may withhold its approval to all actions and matters in this clause
         (viii) in its sole and absolute discretion);

                  (ix) Performing, or causing to be performed, any construction,
         repair or rebuilding of any improvements at the Properties (except in
         an emergency to correct or alleviate any unsafe conditions or except as
         may be required under any tenant leases); PROVIDED, HOWEVER, that SLAB
         may withhold its approval in its sole and absolute discretion on
         decisions to repair or rebuild after a casualty or partial condemnation
         costing more than $250,000 or to construct any new buildings or
         increase the size of any existing buildings. If the Members agree to
         repair or rebuild, any insurance or condemnation proceeds of more than
         $250,000 shall be placed in an escrow and the Members shall reasonably
         agree upon the terms and conditions for the release of the proceeds
         from the escrow in connection with such repair or rebuilding. Any
         insurance or condemnation proceeds not used to repair or rebuild shall
         be distributed to the Members pursuant to Section 13;

                  (x) Except as otherwise provided herein, incurring any
         indebtedness on behalf of the Company or any Investment Entity (except
         that the Members hereby approve any reasonable, ordinary and necessary
         trade payables incurred in the ordinary course of business to
         non-affiliates of the Managing Member, and payments made, pursuant to
         non-affiliate contracts which are in effect at the Closing or which are
         approved by the Members); making, executing or delivering on behalf of
         the Company or any Investment Entity any indemnity bond or surety bond;
         lending funds belonging to the Company or any Investment Entity to any
         person



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         or entity, or extending any person, firm or corporation credit on
         behalf of the Company or any Investment Entity; obligating the Company,
         another Member or any Investment Entity as a surety, guarantor or
         accommodation party to any obligation, except by endorsing checks for
         deposit to the Company's or an Investment Entity's accounts in the
         ordinary course of business, or granting or permitting any lien or
         encumbrance on any Property other than mechanics' liens for work
         performed at the Properties (SLAB may withhold its approval to all
         actions and matters in this clause (x) in its sole and absolute
         discretion);

                  (xi) Confessing a judgment against the Company or any
         Investment Entity; settling or adjusting any claims (including without
         limitation, insurance claims) against or of the Company or any
         Investment Entity; consenting to any condemnation awards or
         settlements; or commencing, defending or discontinuing any legal
         actions or proceedings involving the Company or any Investment Entity,
         to the extent such judgment, claims, awards, settlements, actions or
         proceedings have an aggregate amount in controversy exceeding $250,000
         (SLAB may withhold its approval in its sole and absolute discretion
         with respect to condemnation awards or settlements in excess of 10% of
         the cost of the Property at issue and with respect to any other actions
         or matters in this clause (xi) having an aggregate amount in
         controversy exceeding $1,000,000);

                  (xii) Submitting binding proposals to, or entering into,
         approving, terminating or modifying binding agreements with,
         governmental officials relating to zoning, subdivision, environmental
         or other land use or entitlement matters (SLAB may withhold its
         approval to the foregoing actions and matters in this clause (xii) in
         its sole and absolute discretion; PROVIDED, HOWEVER, that SLAB shall
         have only reasonable approval rights with respect to binding agreements
         regarding zoning and entitlement matters related to tenant improvements
         at the Properties or to landscaping, utility easements, buffers and
         other similar items and conditions required by the Towns of Hanover or
         Parsippany, New Jersey, in connection with obtaining development
         approvals for adjacent land so long as the Properties are not
         materially adversely affected thereby; PROVIDED, FURTHER, that any
         actions taken in order to comply with the applicable zoning and other
         land use requirements shall not require any approval of SLAB);

                  (xiii) Possessing, assigning or using funds or other property
         of the Company or any Investment Entity for other than a Company or
         Investment Entity purpose (SLAB may withhold its approval to the
         actions and matters in this clause (xiii) in its sole and absolute
         discretion);

                  (xiv) Partitioning all or any portion of any Property, or
         filing any complaint or instituting any proceeding at law or in equity
         seeking such partition (SLAB may withhold its approval to the actions
         and matters in this clause (xiv) in its sole and absolute discretion);

                  (xv) Purchasing any assets or equipment on behalf of or in the
         name of the Company or any Investment Entity (except in connection with
         transfers among Investment Entities under



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         Section 11(d)) other than those required in the ordinary course of the
         Company's or such Investment Entity's business (SLAB may withhold its
         approval to the actions and matters in this clause (xv) in its sole and
         absolute discretion);

                  (xvi) Except as otherwise provided in Section 11(d) of this
         Agreement, entering into, approving, terminating or modifying to any
         material extent any loan document or loan instrument to which the
         Company or any Investment Entity is or will be a party or the Company,
         any Investment Entity or any Property is or will be bound or subject
         to, or giving any consent, approval or waiver, or making any
         determination or stipulation, on behalf of the Company or any
         Investment Entity under any such loan document or instrument (SLAB may
         withhold its approval to the actions and matters in this clause (xvi)
         in its sole and absolute discretion);

                  (xvii) Admitting any new Members or causing or permitting any
         merger or restructuring of the Company or the Investment Entities
         (other than pursuant to Section 11(d)) (SLAB may withhold its approval
         to the actions and matters in this clause (xvii) in its sole and
         absolute discretion);

                  (xviii) Modifying or terminating this Agreement or any other
         Company organizational documents or any organizational documents of any
         Investment Entity (SLAB may withhold its approval to the actions and
         matters in this clause (xviii) in its sole and absolute discretion);

                  (xix) Changing the nature of business or business purpose of
         the Company or any Investment Entity (SLAB may withhold its approval to
         the actions and matters in this clause (xix) in its sole and absolute
         discretion);

                  (xx) Making any expenditures not in compliance with the
         Current Budgets, except as the Current Budgets may be modified pursuant
         to Section 11(a) above (SLAB may withhold its approval to the actions
         and matters in this clause (xx) in its sole and absolute discretion);

                  (xxi) Approving the acceptability of any post-closing
         deliveries under the Purchase Agreement and post-closing adjustments
         under the Purchase Agreement; and

                  (xxii) Any other matter that requires the approval of both
         Members under this Agreement (SLAB may withhold its approval to all
         such matters in its sole and absolute discretion unless indicated
         otherwise).

         No amount shall be expended by any Member for a major decision without
first obtaining the approval of the Members (to the extent such approval is
required hereunder at such time). However, the Managing Member may expend
reasonable amounts in response to an emergency (which amounts shall be
reimbursed by the Company or the Investment Entities, as applicable). Failure to
disapprove in writing by a Member within five (5) business days (unless another
time period is specified in this



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Agreement) after receiving a written request for approval from the other Member
under this Agreement shall be deemed an approval of the action or matter in the
request, provided that such request states conspicuously that failure to approve
within such time period constitutes such Member's approval. Any request for
approval herein shall describe the action or matter to be approved with
sufficient specificity to permit a reply, and any approval or disapproval
thereof shall set forth the reasons therefor with sufficient specificity to
permit a reply.

         (c) Subject to the provisions of Section 11(d) but notwithstanding any
other provision to the contrary herein, while MC is not the Managing Member, the
following actions and matters are major decisions requiring the written approval
of MC, which MC may withhold in its sole and absolute discretion:

                  (i) Causing or permitting the Company or any Investment Entity
         to file for bankruptcy or other relief from creditors, including
         without limitation, an assignment for the benefit of creditors, an
         admission in writing by any such entity of its inability to pay its
         debts generally as they become due, causing the Company, a Member's
         membership interest in the Company, any Investment Entity, the
         Company's membership interest in any Investment Entity, or any Property
         or any part thereof or interest therein to be subject to the authority
         of any trustee, custodian or receiver or to be subject to any
         proceeding for bankruptcy, insolvency, reorganization, arrangement,
         readjustment of debt, relief of debtors, dissolution or liquidation or
         similar proceedings;

                  (ii) Dissolving, terminating or liquidating the Company or any
         Investment Entity, or redeeming any interest of any Member, except as
         provided herein;

                  (iii) Entering into, approving, terminating or modifying to
         any material extent the terms of contracts, agreements, leases or other
         undertakings with any affiliates of SLAB. Notwithstanding anything to
         the contrary contained in this Agreement, to the extent any affiliate
         of SLAB is now or hereafter becomes a party to any contract, agreement,
         lease or other undertaking entered into with the Company or any
         Investment Entity, MC, acting alone, shall have the exclusive right and
         authority on behalf of the Company (A) to exercise termination rights
         in accordance with the terms of such document, (B) to enforce and
         defend the Company's or the applicable Investment Entity's rights under
         such document (including by prosecution or defense of any proceeding or
         action that it deems necessary or appropriate), and (C) to retain
         Company or Investment Entity counsel of its choosing in connection with
         the foregoing at SLAB's expense. SLAB shall disclose to MC in writing
         whether any party to a proposed contract, agreement, lease or other
         undertaking to be entered into with the Company or any Investment
         Entity is an affiliate of SLAB promptly after SLAB becomes aware of
         such relationship and such proposed contract, agreement, lease or other
         undertaking, and, in any event (and without limiting the foregoing),
         prior to the Company's or such Investment Entity's execution of the
         same;



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<PAGE>

                  (iv) Possessing, assigning or using funds or other property of
         the Company or any Investment Entity for other than a Company or
         Investment Entity purpose;

                  (v) Admitting any new Members or causing or permitting any
         merger or restructuring of the Company or the Investment Entities
         (other than pursuant to Section 11(d));

                  (vi) Modifying or terminating this Agreement or any other
         Company organizational documents or any organizational documents of any
         Investment Entity; and

                  (vii) Changing the nature of business or business purpose of
         the Company or any Investment Entity.

         (d) Notwithstanding any provision to the contrary contained herein
(including without limitation, Section 11(b) hereof), the Members shall have the
following rights:

                  (i) From the date of this Agreement and until January 2, 2001
         (the "Outside Closing Date"), MC shall have the right, in MC's sole and
         absolute discretion without the other Member's approval being required,
         to negotiate, enter into and perform under, on behalf of the Company
         and/or the Investment Entities, one or more agreements with one or more
         parties (including MC's affiliates) for the sale, financing or
         refinancing of one or more Properties and/or Investment Entities (or
         the ownership interests therein) on any terms and conditions, PROVIDED
         that: (A) any such transaction closes on or prior to the Outside
         Closing Date; (B) all accrued and unpaid Guaranteed Payments to SLAB
         under Section 13(c)(1) must have been made; (C) in the case of sale, a
         financing or refinancing of all of the Properties or interests therein
         not previously sold, financed or refinanced under this Section 11(d)
         (the "Remaining Properties"), the cash sale price received by the
         Company and the Investment Entities at the closing thereunder or the
         loan amount received by Company and the Investment Entities must at
         least be equal to an amount that will result in SLAB receiving, from
         proceeds of the transaction and previous transactions, the sum of the
         amounts described in Sections 13(b)(2)(i), 13(b)(2)(ii), and 13(c)(1)
         hereof (the "SLAB Return Amount"); (D) in the case of sale, a financing
         or refinancing of less than all of the Remaining Properties, the cash
         sale price received by the Company and the Investment Entities at the
         closing thereunder or the loan amount received by Company and the
         Investment Entities must at least be equal to an amount that will
         result in SLAB receiving (in addition to all accrued and unpaid
         Guaranteed Payments), from proceeds of the transaction and
         distributions under Section 13(b)(i), 102% of the amount(s) set forth
         for the Property(ies) at issue in Exhibit C; (E) in the case of sale, a
         financing or refinancing of less than all of the Remaining Properties,
         the Property(ies) to be sold, financed or refinanced must be owned by a
         separate Investment Entity(ies) created and maintained as a limited
         liability company, and the Company and the other Investment Entities
         must not be subject to any personal liability under such sale,
         financing or refinancing (and no other assets of the Company or any
         Investment Entity except those that are the subject of such sale,
         financing or refinancing



                                       11
<PAGE>

         shall be subject to the claims of the lender or purchaser in such
         transaction, whether for debt service, damages or any other amounts),
         and there must not then exist any monetary breach or any uncured
         material non-monetary breach by MC hereunder; and (F) in the case of a
         sale, financing or refinancing of less than all of the Remaining
         Properties, there must not then exist any uncured monetary or material
         non-monetary breach by MC hereunder (except that with respect to
         Section 11(f)(xix) hereof (which shall be determined without regard to
         whether MC used reasonable commercial efforts and without regard to
         materiality), the seller under the Purchase Agreement must also have
         failed to make the deliveries as required by Sections 8.4(c), 8.4(d)
         and 8.4(e) of the Purchase Agreement) and there must not have been a
         material adverse change with respect to any of the other Remaining
         Properties (including without limitation, the value, cash flow or
         tenancy at any such Property). In transactions described in the
         immediately preceding clause (F), MC shall provide written notice of
         same to SLAB at least fifteen (15) business days prior to entering into
         a binding agreement with respect to such transaction and SLAB shall
         have the right to determine, in its sole discretion, whether there has
         been a material adverse change with respect to any of the other
         Remaining Properties. SLAB's failure to provide written notice of such
         determination within fifteen (15) business days after its receipt of
         such notice from MC shall be deemed to be SLAB's determination that
         there has been no such material adverse change. Except as otherwise
         provided in this Section 11(d)(i), until the Outside Closing Date, MC
         shall have the right to perform any act, or execute and deliver any
         document or instrument, as may be reasonably necessary or appropriate
         in connection with such transactions without any other Member's
         approval being required. Notwithstanding the last sentence of Section
         11(b)(ix), the purchaser of a Property or interests therein shall be
         entitled to receive an assignment of any casualty or condemnation
         proceeds allocable to such Property to the extent not theretofore used
         to repair, rebuild or replace the Property (and for which the purchaser
         is not otherwise receiving an appropriate reduction in the purchase
         price).

                  (ii) At any time (A) after the Outside Closing Date, if SLAB
         has not then received the SLAB Return Amount, or (B) MC is in breach of
         Section 11(f)(xix) hereof (which shall be determined without regard to
         whether MC used reasonable commercial efforts and without regard to
         materiality) AND the seller under the Purchase Agreement has failed to
         make the deliveries as required by Sections 8.4(c), 8.4(d) and 8.4(e)
         of the Purchase Agreement, a majority in Residual Percentages of the
         Members (which term, as used herein, shall mean the Members owning
         greater than 50% of all Residual Percentages in the Company) shall have
         the right, in its sole and absolute discretion without the approval of
         any other Member being required, to negotiate, enter into and perform
         under, on behalf of the Company and/or the Investment Entities one or
         more agreements with one or more parties (including affiliates of the
         electing Members) for the sale, financing, refinancing or
         securitization of one or more Properties and/or Investment Entities (or
         the ownership interests therein) on any terms and conditions; PROVIDED,
         HOWEVER, that MC shall have the right to purchase the assets being sold
         or provide such financing or refinancing (as applicable) on the same
         terms and conditions, which right MC must exercise by providing written
         notice thereof to SLAB within 20 days after receiving



                                       12
<PAGE>

         written notice from SLAB setting forth such terms and conditions. MC's
         failure to provide such notice timely shall be deemed MC's election not
         to exercise such right. If MC timely exercise such right, the closing
         shall occur within 30 days thereafter. If MC has not been removed as
         the Managing Member, MC shall cooperate in connection with the
         transactions contemplated under this clause (ii). In connection with
         the sale, financing, refinancing or securitization transactions under
         this Section 11(d)(ii), a majority in Residual Percentages of the
         Members shall (1) have the right to perform any act, or execute and
         deliver any document or instrument, as may be reasonably necessary or
         appropriate in connection with such transactions without any other
         Member's approval being required and (2) cause all costs of the
         foregoing, including without limitation the following due diligence
         items, if required to be provided by the Company or the Investment
         Entities in connection with any such transaction, to be paid at the
         Company expense: engineering reports, Phase I environmental reports,
         appraisal, title reports, searches and endorsements, surveys, and
         certificates of occupancy.

                  (iii) The proceeds (net of transaction costs and expenses)
         from any sale, condemnation, casualty, financing, refinancing or
         securitization described in paragraphs (i) and (ii) of this Section
         11(d) shall be distributed or paid by the Company as provided in this
         Agreement.

                  (iv) In connection with the sale, financing, refinancing or
         securitization transactions described in paragraphs (i) and (ii) of
         this Section 11(d), the Member with the right to cause such
         transactions to occur shall have the right, in such Member's sole and
         absolute discretion without the other Member's approval being required,
         to form one or more additional single-member Investment Entities owned
         by the Company and to cause the existing Investment Entities to
         transfer one or more Properties which are the subject of such sale,
         financing, refinancing or securitization to such additional Investment
         Entities and to transfer the Company's interest in such additional
         Investment Entities or the Property(ies) owned thereby. Except as
         otherwise provided in Section 11(d)(i), such Member shall give written
         notice of any transaction described in this Section 11(d) to the other
         Member at least ten (10) days prior to causing the Company to enter
         into such transaction.

         (e) No Member (including any Managing Member) shall be liable,
responsible or accountable in damages or otherwise to the other Member or the
Company or any Investment Entity for any act or omission of such Member on
behalf of the Company, except for fraud, gross negligence or material breach of
this Agreement. Except as provided in this Section 11(e), the Company shall
indemnify and hold harmless each Member (including any Managing Member) and its
affiliates from and against any obligations, damages, claims, liabilities,
losses, costs or expenses, including reasonable attorneys' fees and costs
(collectively, "Claims"), incurred in connection with or arising out of such
Member acting as a Member or on behalf of the Company in accordance with this
Agreement.



                                       13
<PAGE>

         Each Member shall be liable to the other Member for such other Member's
actual damages to the extent caused by any fraud, gross negligence or material
breach of this Agreement by the liable Member and not caused by any fraud, gross
negligence or material breach of this Agreement by the other Member. As used in
the immediately preceding sentence of this paragraph, the term "actual damages"
shall: (1) include, without limitation, the costs (including reasonable
attorneys' fees and costs) of enforcing the rights of a Member under this
Agreement and collecting such damages; and (2) include, without limitation, any
and all kinds of damages actually paid by such other Member to unaffiliated
third parties (including any consequential, speculative, punitive or special
damages actually paid by such other Member to unaffiliated third parties); but
(3) exclude any other consequential, speculative, punitive or special damages.
MC hereby agrees to indemnify and hold harmless SLAB and its affiliates from and
against any third-party Claims to the extent caused by MC's fraud, gross
negligence or material breach of this Agreement and not by SLAB's fraud, gross
negligence or material breach of this Agreement. Any amounts payable under this
paragraph shall be made immediately upon written demand therefor and shall
accrue interest from the date of such demand until paid at the lesser of fifteen
percent (15%) per annum or the highest rate permitted by applicable law.

         Without limiting the foregoing, upon the occurrence of any of the
following, (A) SLAB shall have the right to remove MC as the Managing Member of
the Company, (B) any distributions to MC under Section 13(b)(2) (other than its
Guaranteed Payments) shall be subordinated to any and all distributions and
payments to SLAB hereunder, and (C) SLAB shall have the right to institute
reasonable cash management procedures pursuant to which tenants will make
payments under their leases directly to a lock box account and SLAB will control
all disbursements therefrom:

                  (i) fraud by MC with respect to the Company, any Investment
         Entity or any Property or with respect to any transactions contemplated
         hereunder;

                  (ii) any gross negligence on the part of MC with respect to
         any of its duties and obligations hereunder which is not cured to
         SLAB's reasonable satisfaction within 45 days after receiving written
         notice of such gross negligence from SLAB;

                  (iii) failure by MC to use any available cash to make the
         Guaranteed Payments under Section 13(c)(1) for three (3) consecutive
         months;

                  (iv) any monetary default by MC under this Agreement at any
         time;

                  (v) any representation or warranty made by seller in the
         Purchase Agreement (or in any other documents delivered to the Company
         thereunder) or made by MC in this Agreement shall have been false or
         misleading in any material respect when made and MC fails to cure (to
         SLAB's reasonable satisfaction) such breach of representation or
         warranty within forty five (45) days after MC's receipt of written
         notice of such breach from SLAB;



                                       14
<PAGE>

                  (vi) except as provided in clause (ix) below of this Section,
         material breach of any non-monetary covenants set forth Section 11(f)
         (determined without regard to whether MC used its reasonable commercial
         efforts in connection therewith) or a material breach of any other
         non-monetary provisions hereof by MC and MC's failure to cure (to
         SLAB's reasonable satisfaction) such breach within forty five (45) days
         after MC's receipt of written notice of such breach from SLAB;

                  (vii) any monetary breach or material non-monetary breach of
         the Management Agreement by the property manager or the Asset
         Management Agreement by the asset manager;

                  (viii) any Bankruptcy Action with respect to MC; and

                  (ix) breach of Section 11(f)(xix) (determined without regard
         to whether MC used its reasonable commercial efforts in connection
         therewith).

         Any notice alleging a breach or gross negligence referenced above shall
specify the breach or gross negligence with sufficient particularity to permit
the cure, and any such cure shall be at the breaching Member's expense. The
non-breaching Member may effect such cure at the breaching Member's expense if
the breaching Member shall fail to effect such cure timely. If MC is removed (or
if a majority in Residual Percentages of the Members is entitled to remove MC)
as the Managing Member hereunder, SLAB shall have the right to terminate all
agreements and contracts between the Company and any affiliates of MC (including
without limitation, the Asset Management Agreement and the Management
Agreement).

         (f) So long as MC is the Managing Member hereunder, MC shall use
reasonable commercial efforts to:

                  (i) not take any actions that require SLAB's approval under
         Section 11(b) without first obtaining such approval or otherwise in
         accordance with Section 11(b);

                  (ii) not cause or permit any Bankruptcy Action;

                  (iii) not cause or permit the Company or the Investment
         Entities to own any encumbered asset other than pursuant to Section
         11(d) (financing right);

                  (iv) not cause or permit the Company or the Investment
         Entities to engage in any business other than the ownership, management
         and operation of the Properties and the Investment Entities;



                                       15
<PAGE>

                  (v) do all things necessary to preserve the Company's and the
         Investment Entities' existence and limited liability company
         formalities;

                  (vi) conduct and operate the business of the Company and the
         Investment Entities as presently conducted and operated in material
         respects;

                  (vii) not cause or permit the Company or the Investment
         Entities to be responsible for the debts or obligations of any person
         or entity other than the Company or the Investment Entities;

                  (viii) provide prompt written notice to SLAB of any
         litigation, bankruptcy, administrative or other court or governmental
         proceedings pending or threatened (in writing) against the Company, any
         Investment Entity or any Property which might have a material adverse
         effect;

                  (ix) not cause or permit the Company to engage in any
         transaction which would cause any obligation, or action taken or to be
         taken, hereunder to be a non-exempt (under a statutory or
         administrative class exemption) prohibited transaction under the
         Employee Retirement Income Security Act of 1974 (or any successor
         legislation thereto), as amended ("ERISA"). MC further covenants and
         agrees to deliver to SLAB such certifications or other evidence from
         time to time throughout the term of this Agreement, as requested by
         SLAB in its sole discretion, that: (i) the Company is not an "employee
         benefit plan" as defined in Section 3(3) of ERISA, which is subject to
         Title I of ERISA, or a "governmental plan" within the meaning of
         Section 3(3) of ERISA; (ii) the Company is not subject to state
         statutes regulating investments and fiduciary obligations with respect
         to governmental plans; and (iii) one or more of the following
         circumstances is true:

                           (1)      Equity interests in the Company are publicly
                                    offered securities, within the meaning of 29
                                    C.F.R. SECTIONS 2510.3-101(b)(2);

                           (2)      Less than twenty-five percent (25%) of each
                                    outstanding class of equity interests in the
                                    Company are held by "benefit plan investors"
                                    within the meaning of 29 C.F.R. SECTIONS
                                    2510.3-101(f)(2); or

                           (3)      The Company qualifies as an "operating
                                    company" or a "real estate operating
                                    company" within the meaning of 29 C.F.R.
                                    SECTIONS 2510.3- 101(c) or (e) or an
                                    investment company registered under The
                                    Investment Company Act of 1940.

                  (x) cause the Company, the Investment Entities and the
         Properties to comply at all times with all laws, statutes, ordinances,
         regulations and other governmental or quasi-



                                       16
<PAGE>

         governmental requirements to which the Company or any Investment Entity
         is subject and with private covenants now or hereafter relating to the
         ownership, construction, use or operation of the Properties, including,
         but not limited to, those concerning environmental or ecological
         requirements;

                  (xi) keep the Properties free and clear of monetary liens
         (except pursuant to Section 11(d) or with required approval under
         Section 11(b));

                  (xii) cause the Company, the Investment Entities and the
         property manager under the Management Agreement to take such
         commercially reasonable actions as may be necessary or appropriate to
         own and operate the Properties in a professional, diligent and
         first-class manner;

                  (xiii) not commit or suffer any waste of the Properties or
         make or permit to be made any change in the use of the Properties which
         will in any way materially increase the risk of fire or other hazard
         arising out of the operation of the Properties, or take or cause to be
         taken any action that might invalidate or give cause for cancellation
         of any insurance policy, or do or permit to be done thereon anything
         that could in any material way impair the value of the Properties;

                  (xiv) cause the Company, the Investment Entities and the
         property manager under the Management Agreement to keep and maintain
         proper and accurate books, records and accounts (separate from those of
         MC's affiliates or any other person or entity) reflecting all of the
         financial affairs of the Company and the Investment Entities and all
         items of income and expense in connection with the operation of the
         Properties;

                  (xv) cause the property manager under the Management Agreement
         and the asset manager under Asset Management Agreement to comply with
         the terms and conditions of such agreements and not permit a breach
         thereof by such managers;

                  (xvi) cause the Company and the Investment Entities to pay
         promptly all taxes, assessments and other governmental impositions with
         respect to the Company, the Investment Entities and the Properties;

                  (xvii) if the Company or the Investment Entities have
         employees, cause the payment of the salaries and other compensation of
         such employees (or the proportionate share of such salaries and
         compensation allocable to the Company and the Investment Entities, as
         applicable);

                  (xviii) provide prompt notice to SLAB of any material breach
         hereunder by MC;



                                       17
<PAGE>

                  (xix) maintain (with respect to MC) an "investment grade"
         rating by Standard Poor's or Moody's or a book value determined in
         accordance with generally accepted accounting principles (excluding
         good will and adding back all accumulated depreciation and
         amortization) of at least $1,500,000,000;

                  (xx) not cause or permit the Company and the Investment
        Entities to commingle their funds and other assets with those of any
        affiliate of MC or any other person or entity; and

                  (xxi) cause the Company and the Investment Entities to
        maintain their assets in such a manner that it will not be costly or
        difficult to segregate, ascertain or identify their individual assets
        from those of any affiliate of MC or any other person or entity.

               12. DETERMINATION OF PROFITS AND LOSSES. The net profits and net
losses of the Company shall be as determined for federal income tax purposes for
each calendar year. The Members intend that the Company be treated as a
partnership for tax purposes and each Investment Entity be treated as a
disregarded entity for income tax purposes. The Members hereby agree that they
will not cause or permit the Company or any Investment Entity to become a
taxable entity. No Member shall under any circumstances be required to pay or
restore any portion of the negative balance in its capital account or to repay
any portion thereof to the Company, any Company creditor or another Member. No
Member may demand the return of its capital contributions, it being intended
that all distributions be made pursuant to Section 13 below.

               13. ALLOCATION OF INCOME AND LOSSES; DISTRIBUTIONS; GUARANTEED
PAYMENTS.

        (a)    TAX ALLOCATIONS.

               (i) Tax losses of the Company for any fiscal period shall be
        allocated (A) first to MC, until its capital account has been reduced to
        zero, (B) then to SLAB, until its capital account has been reduced to
        zero, and (C) then to the Members in accordance with their Residual
        Percentages.

               (ii) Taxable income of the Company for any fiscal period shall be
        allocated (A) first to SLAB, until SLAB has been allocated an aggregate
        amount of income under this clause (ii) equal to the amount
        distributable to SLAB pursuant to Section 13(b)(2)(i) and (B) thereafter
        to the Members in accordance with their Residual Percentages.

               (iii) For purposes of this Section 13(a)(iii), Guaranteed
        Payments shall not be treated as distributions. On or before April 15 of
        each year, the Company shall, upon the written request of any Member
        ("Requesting Member"), pay (to the extent the Company has available
        funds, determined prior to making distributions for the preceding
        calendar year), as an advance against future distributions to the
        Requesting Member under Section 13(b)(1) and



                                       18
<PAGE>

         13(b)(2)(iv), (a "Tax Payment Advance") to the Requesting Member an
         amount equal to the excess of (A) 40% multiplied by the Requesting
         Member's cumulative allocations of income pursuant to Section
         13(a)(ii)(B), over (B) the sum of (x) the Requesting Member's
         cumulative distributions from the Company under Sections 13(b)(1) and
         13(b)(2)(iv) from the date hereof through the end of the preceding
         calendar year (net of repayments thereof) and (y) the outstanding
         balance(s) of all the unpaid Tax Payment Advances to such Requesting
         Member. A copy of any request for a Tax Payment Advance shall be given
         by the requesting Member to the other Member. Such advance shall not
         bear interest, and shall be repayable both (A) out of future
         distributions to the Requesting Member under Sections 13(b)(1) and
         13(b)(2)(iv) (such payment to be made by withholding such
         distributions, with such distributions being deemed to have been
         distributed to the Requesting Member and then paid by the Requesting
         Member to the Company), and (B) if earlier, upon the liquidation of the
         Company or upon demand following the Requesting Member's ceasing for
         any reason to be a Member hereunder, which payments shall be made from
         the distributions otherwise payable to such Member in connection with
         the liquidation. In no event shall the Company be required to borrow
         money or to sell any asset in order to fund any Tax Payment Advance.

        (b)    DISTRIBUTIONS.

               (1) CASH FLOW FROM OPERATIONS. Distributions of net available
cash from any source (other than distributions of sale, casualty, condemnation,
loan or securitization proceeds described in Section 11(d)) and proceeds of any
other capital transactions remaining after Guaranteed Payments (as defined in
and in accordance with Section 13(c) below), expenses, debt service, reserves
and capital improvements for any period shall be made as follows, after first
repaying any loans made by the Members to the Company and Investment Entities
pursuant to Section 9 (loans which have been outstanding the longest shall be
repaid first, with any loans that have been outstanding for an equal period
being repaid pro rata, in proportion to such loans' respective balances, and
with the accrued and unpaid interest being repaid first and then the principal
being repaid next) (such excess net available cash, the "Excess Cash Flow"): to
the Members, PARI PASSU, 55% to SLAB and 45% to MC; PROVIDED, HOWEVER, that the
Managing Member shall have the right to not make the distribution of such Excess
Cash Flow distributable to SLAB and hold it in Company reserve earmarked to make
the distribution under Section 13(b)(2)(i) (in which case, the amount
distributable to SLAB under Section 13(b)(2)(i) shall be reduced by the amount
so earmarked when distribution thereof is made to SLAB under Section
13(b)(2)(i)) and distribute such Excess Cash Flow to SLAB as a distribution
under Section 13(b)(2)(i) at such time as SLAB would otherwise be entitled to a
distribution under Section 13(b)(2)(i).

               (2) SALE/REFINANCING PROCEEDS. Distributions of sale,
disposition, loan or securitization proceeds described in Section 11(d) (or any
insurance or condemnation proceeds not used to repair, rebuild or replace the
Properties) and proceeds of any other capital transactions remaining after
Guaranteed Payments (as defined in and in accordance with the subsection
entitled



                                       19
<PAGE>

"Guaranteed Payments" below in this Section 13), and reasonable, ordinary and
necessary expenses being paid in connection therewith shall be made in the
following order of priority after first repaying any loans made by the Members
to the Company and Investment Entities (loans which have been outstanding the
longest shall be repaid first, with any loans that have been outstanding for an
equal period being repaid pro rata, in proportion to such loans' respective
balances, and with the accrued and unpaid interest being repaid first and then
the principal being repaid next):

               (i) First, such amounts (including reserved amounts under Section
        13(b)(1)) shall be distributed to SLAB until SLAB has received an amount
        equal to (A) the product of two percent (2%) of SLAB's Capital
        Contributions times (B) the number of years (commencing with January 1,
        2000) during which such Capital Contributions were outstanding (with
        each partial year treated as a full year) reduced by cash flow paid to
        SLAB in the 55/45 ratio under Section 13(b)(1) and not held in reserves
        described in Section 13(b)(1);

               (ii) Second, the balance shall be distributed to SLAB to the
        extent of its Capital Contributions attributable to the Properties as
        set forth on Exhibit C for which a sale, loan or securitization has
        occurred and which have not previously been repaid pursuant to this
        section 13(b)(2)(ii);

               (iii) Third, the balance shall be distributed to MC to the extent
        of its Capital Contributions attributable to the Properties as set forth
        on Exhibit F for which a sale, loan or securitization has occurred which
        have not been repaid by distributions to it under this Section
        13(b)(2)(iii); and

               (iv) Next, the balance shall be distributed to the Members, PARI
        PASSU, 55% to SLAB and 45% to MC.

               (3) LIQUIDATING DISTRIBUTIONS. Upon liquidation of the Company,
after all of the Company's debts have been paid, distributions shall be made in
accordance with the Members' capital accounts.

        (c) GUARANTEED PAYMENTS. The Company shall make guaranteed payments
under Code Section 707(c) ("Guaranteed Payments"), on the fifth (5th) day of
each calendar month (commencing with February 5, 2000) from available cash from
any source, to the Members for the use of their respective capital contributions
as follows (with amounts not paid currently being added to the unpaid principal
amount of the Guaranteed Payments then owing):

               (1) First, to SLAB in an amount equal to SLAB's accrued and
        unpaid Guaranteed Payments, which shall mean an amount equal to SLAB's
        capital contributions which have not been repaid by distributions to it
        under Section 13(b)(2)(ii) multiplied by LIBOR plus 200 basis



                                       20
<PAGE>

         points per annum, compounded monthly (using the rate under Section 9
         applicable that month applied to total outstanding balance), until the
         date the payment is made; and

               (2) After making the Guaranteed Payments described in Section
        13(c)(1), to MC in an amount equal to MC's accrued and unpaid Guaranteed
        Payments, which shall mean an amount equal to MC's capital contributions
        which have not been repaid by distributions to it under Section
        13(b)(2)(iii) multiplied by the rate in effect from time to time that is
        122% of the rate used in Section 13(c)(1).

               14. RESTRICTIONS ON TRANSFER. Neither of the Members shall
transfer, assign, pledge or hypothecate any of their respective right, title or
interest in the Company, or permit transfers of direct or indirect ownership in
such Member without the prior written approval of the other Member, which
approval may be granted or withheld in the other Member's sole and absolute
discretion, except as may be required by law or by reason of an individual's
death, incapacity or divorce, and except as necessary to effect the transactions
described in Section 11(d). Nothing in this Section 14 shall be construed to
prohibit or restrict any sale, transfer, assignment, pledge or hypothecation of
any stock (or any interests therein) of any publicly-traded entity which
directly, indirectly or ultimately owns any interest in any Member, or the
transfer of units or partnership interests in Mack-Cali Realty, L.P, or the
transfer of any direct or indirect interest in the Company by any Member to its
affiliates, or the transfer of any interest in DLJ Mortgage Capital, Inc. No
transfer herein shall affect the obligations and liabilities of the transferring
party hereunder.

               15. WAIVER OF NON-COMPETITION. Each Member hereby acknowledges
and agrees that each Member and its affiliates may continue to pursue their
existing businesses, including without limitation, acquisition, financing,
development, operation, management, leasing of, and investments in, any
properties or projects, and the disposition thereof, regardless of whether the
same is competitive with the Properties. Each Member further acknowledges and
agrees that no Member or any of its affiliates shall be obligated to present any
particular investment or business opportunity to the Company or the other Member
or its affiliates, even if such opportunity is of a character which, if
presented to the Company or the other Member, could be undertaken by the Company
or the other Member, and each Member and each of its affiliates shall have the
right to acquire for its own account, or to recommend to others, any such
opportunity. Notwithstanding any provision to the contrary in this Agreement, MC
hereby agrees not to induce any existing tenant at the Properties (while owned
by the Company or the Investment Entities owned by the Company) to breach,
modify or terminate such tenant's lease at the Properties in favor of a lease at
another property owned by MC or its affiliates

               16. ACCOUNTANTS AND ATTORNEYS; ENGINEERING REPORTS AND
APPRAISALS. PricewaterhouseCoopers shall be the Company's accountants, and the
Company may engage any of Battle Fowler LLP, Weil Gotshal & Manges LLP and Farer
Siegel & Fersko (with respect to environmental matters) as Company's attorneys.
Other accountants may be engaged so long as their engagement is not to perform
an audit of the Company's or any Investment Entity's books or to sign tax




                                       21
<PAGE>

returns for the Company or any Investment Entity (all of which must be done by
PricewaterhouseCoopers). Any change of Company accountants, or additional
attorneys, shall be subject to the reasonable approval of both Members. The
Managing Member shall cause engineering reports and appraisals of the Properties
to be prepared at the Company expense within 30 days after the Outside Closing
Date.

               17. REPRESENTATIONS AND WARRANTIES. Each Member hereby represents
and warrants to the other Member as follows:

               i.      Such Member is duly formed and validly existing under the
                       laws of the jurisdiction of its organization with full
                       power and authority to enter into this Agreement and to
                       conduct its business to the extent contemplated in this
                       Agreement;

               ii.     This Agreement has been duly authorized, executed and
                       delivered by such Member and constitutes the valid and
                       legally binding agreement of such Member, enforceable in
                       accordance with its terms against such Member, except as
                       such enforceability may be limited by bankruptcy,
                       insolvency, moratorium and other similar laws relating to
                       creditors' rights generally, by general equitable
                       principles and by any implied covenant of good faith and
                       fair dealing;

               iii.    The execution and delivery of this Agreement by such
                       Member and the performance of its duties and obligations
                       hereunder do not result in a breach of any of the terms,
                       conditions or provisions of, or constitute a default
                       under, any indenture, mortgage, deed of trust, credit
                       agreement, note or other evidence of indebtedness, or any
                       lease or other agreement, or any license, permit,
                       franchise or certificate to which such Member is a party
                       or by which it is bound or to which its properties are
                       subject or require any authorization or approval under or
                       pursuant to any of the foregoing, or violate any statute,
                       regulation, law, order, writ, injunction, judgment or
                       decree to which such Member is subject, or require any
                       governmental consent; and

               iv.     Such Member is relying on such Member's own tax, legal
                       and accounting professionals and consultants in
                       connection with such Member entering into this Agreement.

               18. WAIVER OF RIGHT OF PARTITION. Each Member hereby waives all
rights to commence an action for the partition of the Company, the Investment
Entities or the Company's or the Investment Entities' property.



                                       22
<PAGE>

               19. MEETINGS. Meetings of the Members shall not be required
unless requested by any Member by written notice to the Company and the other
Member. All Members shall be given written notice of any meeting of the Company
at least twenty (20) days prior to any such meeting by the Member requesting
such meeting. Any meetings shall be held at the record-keeping office of the
Company or at any other reasonably convenient location within New York City or
New Jersey as the requesting Member may reasonably approve and specify in such
notice.

               20. COUNTERPARTS. This Agreement may be executed in counterparts
and execution and delivery by facsimile transmission is authorized for all
purposes.

               21. NOTICES. Any notices or solicitations of approval required or
permitted to be given under the terms of this Agreement shall be in writing and
shall be deemed to have been given when (i) personally delivered with signed
receipt obtained, (ii) when transmitted by facsimile machine, with printed
confirmation of successful transmission to the facsimile machine number set
forth in the appropriate address listed below being obtained by the sender from
the sender's facsimile machine or telephonically from the addressee, or (iii)
when deposited in the United States first class mail if sent postage prepaid by
registered or certified mail, return receipt requested, in each case addressed
as follows:

        IF TO MC:

               c/o Mack-Cali Realty Corporation
               11 Commerce Drive
               Cranford, New Jersey 07016
               with separate notices to the attention of:
               Mr. Mitchell E. Hersh
               Tel:    (908) 272-8000
               Fax:    (908) 272-6755
               and
               Roger W. Thomas, Esq.
               Tel:    (908) 272-2612
               Fax:    (908) 497-0485

        with a copy to:

               Battle Fowler LLP
               75 East 55th Street
               New York, New York  10022
               Attn:   Richard L. O'Toole, Esq.
                       Leslie H. Loffman, Esq.
               Tel:    (212) 856-7000



                                       23
<PAGE>

               Fax:    (212) 856-7810

        and to:

               Battle Fowler LLP
               2049 Century Park East, Suite 2350
               Los Angeles, California 90067
               Attn:   Sanford C. Presant, Esq.
                       Sung H. Shin, Esq.
               Tel:    (310) 788-3000
               Fax:    (310) 277-0336

        IF TO SLAB:

               SLAB Investments Holding, Inc.
               c/o Donaldson, Lufkin & Jenrette
               277 Park Avenue
               New York, New York 10172
               with separate notices to the attention of:
               Mr. John Bricker
               Tel:    (212) 892-2657
               Fax:    (212) 892-6101
               and
               Mr. Dante LaRocca
               Tel:    (212) 892-4964
               Fax:    (212) 892-6101

               and
               280 Park Avenue, 5th Floor
               New York, New York 10172
               Attn:   Mr. Mark Competiello
               Tel:    (212) 892-4939
               Fax:    (212) 892-4955



                                       24
<PAGE>




        with a copy to:

               Weil Gotshal & Manges
               767 Fifth Avenue
               New York, New York  10153
               Attn:   J. Philip Rosen, Esq.
                       Larry Gelbfish, Esq.
               Tel:    (212) 310-8000
               Fax:    (212) 310-8007

The time to respond to any notice shall commence to run on the date of delivery
at the appropriate addresses (or attempted delivery if delivery is refused
during normal business hours).

               22. ATTORNEYS' FEES. In the event a party hereto files any
action, lawsuit or other legal proceeding against another party hereto by reason
of any breach of any of the covenants, agreements or provisions contained in
this Agreement, the prevailing party in such proceeding will be entitled to have
and recover certain fees from the other party including all reasonable
attorneys' fees and costs resulting therefrom.

               23. SET-OFF. In addition to any rights and remedies of the
Members provided by law, each Member shall have the right, without prior notice
to the Company (with such notice being expressly waived by the Company to the
extent permitted by law) upon any Bankruptcy Action with respect to the Company
or any Investment Entity, to set-off and apply against any amounts owed to such
Member, any amounts owing from such Member to the Company, at or at any time
after the occurrence of such Bankruptcy Action, and the aforesaid right of
set-off may be exercised by such Member against the Company or against any
trustee in bankruptcy, debtor in possession, assignee for the benefit of
creditors, receiver or execution, judgment or attachment creditor, or anyone
else claiming through or against the Company, notwithstanding that such right of
set-off shall not have been exercised by such Member prior to the making,
filing, issuance or service upon such Member of, or of notice of, any such
Bankruptcy Action.

               24. CONSTRUCTION. Headings at the beginning of each section or
subsection are solely for the convenience of the parties and are not a part of
this Agreement. This Agreement shall not be construed as if it had been prepared
by one of the parties, but rather as if both parties had prepared the same. All
exhibits, schedules and other attachments hereto are incorporated as a part of
this Agreement by this reference. This Agreement shall be interpreted using New
Jersey law (without regard to conflict of law provisions). As used herein, the
words "lease," "tenant" and any derivatives thereof shall also include subleases
and subtenants, as the context permits or requires.

               25. SEVERABILITY. If any term or other provision of this
Agreement is invalid, illegal, or incapable of being enforced by any rule of law
or public policy, all of the other conditions and



                                       25
<PAGE>

provisions of this Agreement will nevertheless remain in full force and effect,
so as to cause the economic substance of the transactions contemplated hereby
not to be affected in any adverse manner to either party.

               26. SOLE DISCRETION. In any instance in this Agreement in which a
Member (including the Managing Member) may act in its sole discretion, such sole
discretion means the sole, absolute and unfettered discretion of such Member,
without any express or implied obligation or duty of good faith.

               27. PRESS RELEASES. Before either Member discloses in writing to
any third party any of the terms and conditions of this Agreement (or the
transaction contemplated hereby), such Member shall provide a copy of such
writing to the other Member for its review and comment (but not its approval).
Either Member may request a meeting to discuss any such writing.

                               [signatures follow]


                                       26
<PAGE>



               IN WITNESS WHEREOF, the undersigned Members have executed this
Agreement as of the date first written above.


                         SLAB INVESTMENTS HOLDING, INC.,
                         a Delaware corporation

                         By:
                              ------------------------------------
                                John Bricker, its Vice President




                         MACK-CALI REALTY, L.P.,
                         a Delaware limited partnership

                         By:    Mack-Cali Realty Corporation,
                                a Maryland corporation,
                                its general partner

                                By:
                                    ------------------------------
                                      Roger W. Thomas,
                                      its Executive Vice President

                               [END OF SIGNATURES]


                                       27
<PAGE>



                                    EXHIBIT A
                                    ---------

                   CAPITAL CONTRIBUTIONS; FUNDING PROPORTIONS;
                            AND RESIDUAL PERCENTAGES

<TABLE>
<CAPTION>
                       CAPITAL               FUNDING                RESIDUAL
MEMBER                 CONTRIBUTIONS         PROPORTIONS            PERCENTAGES

<S>                    <C>                       <C>                   <C>
MC                     $  68,400,000             45%                   45%
SLAB                   $  83,600,000             55%                   55%

                       -------------             ----                 ----
Total:                 $ 152,000,000             100%                 100%
</TABLE>







                                       A-1

<PAGE>



                                    EXHIBIT B
                                    ---------

                                LEGAL DESCRIPTION



                                 [see attached]


                                       B-1

<PAGE>



                                    EXHIBIT C
                                    ---------

                    SLAB ALLOCATION OF CAPITAL CONTRIBUTIONS


                                 [see attached]








                                       C-1

<PAGE>



                                    EXHIBIT D

                             REPORTING REQUIREMENTS

        1. GOVERNMENTAL REPORTS; MEETINGS. MC shall, at Company expense, use
reasonable efforts to cause to be prepared and timely filed with appropriate
federal, state and foreign regulatory and administrative bodies, all reports
required to be filed with such entities under then current applicable laws,
rules and regulations, subject to the reasonable approval of the Members. Such
reports shall be prepared on the accounting or reporting basis required by such
regulatory bodies. Each Member shall be provided with a copy of any such report.

        2. ACCESS; AUDIT. Each Member shall permit any other Member to review
and copy, during normal business hours at the office of the Company, all Company
financial records and information. Each Member shall have the right to have such
records and information audited at Company expense; PROVIDED, HOWEVER, if such
audit reveals material errors or omissions in such records and information due
to actual fraud or misappropriation of funds by any Member, such Member shall
reimburse the Company for the expense of audit. MC shall maintain (at the office
of the Company) reports required or otherwise prepared and delivered hereunder,
copies of which shall be furnished to each Member when available, at the
Company's expense, together with (upon request from any Member) such
supplementary records and reports as are necessary to reflect the allocation
among the Members of the tax items and distributions of the Company shown on any
reports furnished (or required to be furnished) to the Members under this
Agreement. MC shall promptly provide any and all records, reports and
information regarding the Company, any Investment Entity or any Property
requested by SLAB from time to time to the extent such records, reports and
information are in MC's possession or control.

         3. FINANCIAL AND STATUS REPORTS. (a) MC shall cause the following
reports to be issued at Company expense:

               (i) MC shall use reasonable efforts to cause to be issued to the
        Members, at Company expense, audited annual financial reports (except
        for year 1999, which may be unaudited but certified by MC) within 90
        days following the close of each year (including a balance sheet and
        income and expense statements, showing sources and uses of funds, cash
        on hand, distributions, changes in financial position, tax information,
        unpaid Guaranteed Payments, fees under the Asset Management Agreement
        and the Management Agreement, Capital Contributions, and unrepaid Member
        loans on a Member-by-Member basis). Such financial reports shall be
        prepared using GAAP; and

               (ii) MC shall use reasonable efforts to cause to be issued to the
        Members quarterly unaudited financial reports, in reasonable detail and
        certified by the Managing Member, within 40 days after the close of each
        calendar quarter other than the fourth quarter of each year



                                      D-1
<PAGE>

         (commencing with the calendar quarter ending on March 31, 2000),
         internally prepared by MC and reviewed by the Company's accountants,
         including a balance sheet and income and expense statements (showing
         receipts on a tenant-by-tenant basis, and material defaults, to the
         extent requested by either MC or SLAB upon reasonable notice), sources
         and uses of funds, cash on hand, distributions, changes in financial
         position, unpaid Guaranteed Payments, Asset Management Fees, Capital
         Contributions, and unrepaid Member loans.

        (b) In preparing reports required under this Agreement, MC may rely on
information furnished by third parties (including property managers and
accountants) to the extent that it is reasonable to do so.



                                       D-2

<PAGE>



                                    EXHIBIT E
                                    ---------

                                 CURRENT BUDGETS



                   [MACK-CALI TO PROVIDE TO DLJ FOR APPROVAL]





                                       E-1

<PAGE>


                                    EXHIBIT F
                                    ---------

                     MC ALLOCATION OF CAPITAL CONTRIBUTIONS



                                 [see attached]




                                       F-1