<PAGE>   1

                                                                   EXHIBIT 10.65


                                  VERTICAL CLUB
                                      LEASE

                                 MARCH 26, 1985



<PAGE>   2

                    AMENDED AND RESTATED NET OPERATING LEASE

                                      AMONG

             HIRSCHFELD REALTY CLUB CORPORATION AND 328 E. 61 CORP.,

                                    Landlord

                                     - and -

                    VERTICAL FITNESS AND RACQUET CLUB, LTD.,

                                     Tenant

Premises:      330 East 61st Street and
               333 East 60th Street,
               New York, New York

Dated: March 26, 1985


<PAGE>   3

                                      INDEX

<TABLE>
<CAPTION>
  ARTICLE                                              SUBJECT                                             PAGE
  -------                                              -------                                             ----
<S>          <C>                                                                                           <C>
     1.      Term .......................................................................................    3

     2.      Rental .....................................................................................    4

     3.      Use of Demised Premises; The Existing Leases ...............................................    9

     4.      Payment of Taxes ...........................................................................   14

     5.      Prorations .................................................................................   18

     6.      Condition and Care of the Demised Premises; Repairs, Improvements and Alterations ..........   18

     7.      The 328 Easement ...........................................................................   25

     8.      Zoning Rights ..............................................................................   27

     9.      Compliance with Laws .......................................................................   30

    10.      Indemnification of Landlord; Limitation of Liability .......................................   35

    11.      Insurance ..................................................................................   37

    12.      Damage or Destruction ......................................................................   42

    13.      Condemnation ...............................................................................   50

    14.      Removal of Tenant's Property ...............................................................   55

    15.      Landlord's Right to Perform Tenant's Covenants and cure Tenant's Defaults; Tenant's Right to  
               Perform Landlord's Covenants and Cure Landlord's Defaults ................................   56

    16.      Discharge of Liens .........................................................................   59

    17.      Landlord's Access to Demised Premises ......................................................   60

    18.      Assignment, Subletting and Control .........................................................   61

    19.      Default ....................................................................................   66

    20.      Quiet Enjoyment ............................................................................   73

    21.      Subordination ..............................................................................   74

    22.      Brokerage ..................................................................................   78

    23.      Lease Status; Landlord's and Tenant's Certificates .........................................   79

    24.      Holdover ...................................................................................   80

    25.      Renewal Options ............................................................................   80

    26.      Surrender of Premises ......................................................................   92

    27.      Signs ......................................................................................   93

    28.      Waiver of Trial by Jury ....................................................................   93

    29.      Miscellaneous Provisions ...................................................................   94
</TABLE>



<PAGE>   4



<TABLE>
<S>               <C>
EXHIBIT A-1    -  Legal Description of the Main Parcel

EXHIBIT A-2    -  Legal Description of the Elevator Shaft Parcel

EXHIBIT B-1    -  Permitted Encumbrances for Main Parcel

EXHIBIT B-2    -  Permitted Encumbrances for Elevator Shaft Parcel

EXHIBIT C      -  Form of Memorandum regarding terms of Lease and Restrictions on 336 Site

EXHIBIT D      -  Existing Leases Assignment Agreement

EXHIBIT E      -  Form of Existing Lease Estoppel Certificate

EXHIBIT F      -  Copies of Existing Leases

EXHIBIT G      -  Form of 328 Easement Agreement

EXHIBIT H      -  Form of Amended Non-Disturbance Agreement
</TABLE>



<PAGE>   5

                    AMENDED AND RESTATED NET OPERATING LEASE

        THIS LEASE, dated as of March 26, 1985, by and among Hirschfeld Realty
Club Corporation, a New York corporation, formerly known as Vertical Club
Corporation, having an office at 336 East 61st Street, New York, New York 10021
("Hirschfeld") and 328 E. 61 Corp., a New York corporation, having an office at
336 East 61st Street, New York, New York 10021 ("328" and, together with
Hirschfeld, being hereinafter collectively referred to as "Landlord"), as
landlord, and Vertical Fitness and Racquet Club, Ltd., a New York corporation,
having an office at 330 East 61st Street, New York, New York 10021, as tenant
("Tenant").

                              W I T N E S S E T H:

        WHEREAS, Hirschfeld and Tenant are the parties to a certain lease, dated
as of August 26, 1980, as modified by Letter Agreement, dated September 29, 1980
(said lease, as so modified, being hereinafter referred to as the "Prior
Lease"), covering a substantial portion of the Demised Premises (as hereinafter
defined);

        WHEREAS, Landlord and Tenant are mutually desirous of amending the Prior
Lease and restating the same in its entirety, upon the terms and subject to the
conditions set forth in this Agreement.

        NOW, THEREFORE, in consideration of the foregoing and the mutual
covenants contained herein, the parties hereto hereby mutually agree that the
Prior Lease is amended and restated in its entirety so that all of the terms and
provisions thereof are as contained herein as follows:

        Landlord hereby leases to Tenant and Tenant hereby leases from Landlord
that certain parcel of land (the "Main Parcel") being more particularly
described on Exhibit A-1 annexed hereto and made a part hereof and that certain
parcel of land (the "Elevator Shaft Parcel") being more particularly described
on Exhibit A-2 annexed hereto and made a part hereof, together with the building
(the "Building") and other structures and improvements now or hereafter erected
thereon (the "Improvements").

        TOGETHER WITH:

        (a) all right, title and interest, if any, of Landlord in and to any
land lying in the bed of any street, road or avenue, open or proposed, in front
of or adjoining the Main Parcel, to the center line thereof;

        (b) all right, title and interest, if any, of Landlord in and to any
strips and gores of land adjacent to, abutting or used in connection with the
Main Parcel, and in and to easements, if any, inuring to the benefit of the
Demised Premises (or the fee owner thereof), the equipment located on the roof
of the Adjacent Parcel (as hereinafter defined) or otherwise as more
particularly described in the 328 Easement (as defined and being more
particularly described in Section 7.01 hereof);

        (c) all appurtenances and hereditaments belonging or in any wise
appertaining to the Main Parcel; and

        (d) all apparatus, fixtures, equipment and articles of personal property
now or hereafter attached to or used in connection with the operation and
maintenance of the Improvements (all of the foregoing items being hereinafter
collectively referred to as the "Demised Premises").

        SUBJECT TO the Existing Leases (as hereinafter defined) and all those
certain conditions and other matters affecting the title of the Demised Premises
as set forth on Exhibits B-1 and B-2 annexed hereto and made a part hereof (the
"Permitted Encumbrances").

        IT IS MUTUALLY COVENANTED AND AGREED between Landlord and Tenant as
follows:

                                    ARTICLE 1



<PAGE>   6

                                      TERM

        1.01 TO HAVE AND TO HOLD the Demised Premises for a term that commenced
on the date set forth in the Prior Lease (the "Commencement Date") and expiring
on September 30, 2001 (such date, or such earlier date upon which the term of
this Lease shall terminate or such later date to which the term of this Lease
shall be extended, being hereinafter referred to as the "Expiration Date").

        1.02 Simultaneously with the execution hereof, Landlord and Tenant shall
each duly execute and acknowledge a memorandum of lease in the form annexed
hereto as Exhibit C, and Tenant shall cause same to be duly recorded in the New
York County Office of the Register of the City of New York (the "City Register's
Office"), as affecting (i) the Demised Premises and (ii) the 336 Site (as
defined in Article 7 hereof), but only to the extent provided by Article 8
hereof with respect to the utilization of Excess Zoning Rights (as defined in
Article 8 hereof) that are appurtenant to the Demised Premises and the Adjacent
Parcel (as defined in Article 7 hereof) in connection with the construction of
the East Tower Improvements (as defined in Article 8 hereof) in such manner so
as to, among other matters, prevent any encroachment onto the Demised Premises,
or any portion thereof.

                                    ARTICLE 2
                                     RENTAL

        2.01 Tenant agrees to pay Landlord a fixed rental ("Fixed Rent"), (a)
with respect to the period from and after the date hereof and until September
30, 1988, at the rate of Seven Hundred Ninety Two Thousand ($792,000) Dollars
per annum and (b) for each ensuing four (4) year period (i.e., October 1, 1988
until September 30, 1992, October 1, 1992 until September 30, 1996, October 1,
1996 until September 30, 2000), and for the one (1) year period from October 1,
2000 until September 30, 2001, at a rate equal to the Fixed Rent per annum that
was payable immediately prior to the commencement of such four (4) year period
or one (1) year period, as the case may be, increased by Seventy-Two Thousand
($72,000) Dollars.

        The Fixed Rent shall continue to be payable in equal monthly
installments equal to one-twelfth (1/12th) of the annual rate of Fixed Rent, in
advance, on the first day of each successive calendar month during the term of
this Lease, at the office of Landlord, or such other place as Landlord may
designate in writing from time to time. Rent for any portion of a month shall be
prorated. The Fixed Rent payable by Tenant pursuant hereto shall be over and
above all other payments required to be made by Tenant as provided in this
Lease.

        All Fixed Rent, additional rent (as hereinafter provided) and other sums
payable by Tenant hereunder shall be paid in lawful money of the United States
of America, which shall be legal tender for the payment of all public and
private debts at the time of payment.

        If Landlord shall not have received the payment of any Rent or other sum
due it pursuant to the provisions of this Lease within fifteen (15) days after
the date on which such rent or other sum first became due (the "Due Date"), then
Tenant shall pay to Landlord, on demand as a late payment penalty or fee,
interest thereon at the Penalty Rate from the Due Date until payment of such
amount is received by Landlord. Provision in this Lease for a late payment fee
or penalty shall not be deemed to be in lieu of Landlord's rights hereinafter
provided for upon the occurrence of an Event of Default.

        2.02 Tenant shall pay for all public utilities, including all charges
for electricity, water, sewerage, heat, fuel oil, gas, steam and telephone,
incurred in connection with the operation of the Demised Premises during the
term of this Lease. Tenant shall have the right, in the exercise of its sole and
absolute discretion, to enter into such new arrangements or to continue existing
arrangements in effect with respect to submetering or otherwise accounting for
and billing subtenants of any portion of the Demised Premises.

        2.03 During the remaining current term of each of the Existing Leases
(as that term is defined in Article 3 hereof), Tenant shall also pay to
Landlord, as additional rent hereunder, an amount equal to any and all rental


<PAGE>   7
payments payable by the sub-tenants under the terms of each of the Existing
Leases (less the portion of any such rental payments that are attributable to
tax and/or insurance-cost escalations, pursuant to the provisions of Section 44
of the Larama Lease and Section 46 of the L.P. Lease, respectively), which
amount shall be payable by Tenant to Landlord whether or not such rents have
been actually paid by the sub-tenants under each of the Existing Leases to
Tenant. In connection with the assignment by Landlord to Tenant of all its
right, title and interest in and to the Landlord's interest under each of the
Existing Leases as referred to in Section 3.01 hereof, Landlord shall promptly
notify the tenants under each of the Existing Leases to make all rental and
other payments thereunder directly to Tenant and Tenant shall hereafter have the
absolute right to bring any action or proceeding against the tenants under
either of the Existing Leases for non-payment of rent or otherwise take any
appropriate actions to enforce the provisions thereof.

        To the extent that either of the tenants under the Existing Leases is in
arrears with respect to payment of rent or other charges under its lease as of
the date hereof (or is obligated to pay charges thereunder that are attributable
to periods prior to the date hereof which are not yet due), Tenant shall remit
such amounts to Landlord on an if, as and when collected basis (in the case of
amounts in arrears at the date hereof after receipt by Tenant of current rentals
and any arrearages arising from and after the date hereof); provided, however,
that Landlord will be entitled to receive arrearages owing to Landlord on the
date hereof from the tenants under the Existing Leases (but only to the extent
not more than thirty (30) days in arrears on the date hereof) from first rentals
or other charges paid to Tenant by each of the tenants under the Existing
Leases.

        From and after the expiration of the existing terms of each of the
Existing Leases and throughout the remainder of the original term of this Lease,
Tenant shall pay to Landlord, as additional rent hereunder, a fixed rental for
the spaces presently covered by each of the Existing Leases (the "Additional
Space") calculated as follows:

        (1) With respect to the space covered by the Larama Lease, from and
after the expiration of the term thereof on October 31, 2000 and until the
Expiration Date of the original term of this Lease, additional rent shall be
payable hereunder for such space at a rate equal to the then fair market rental
value thereof (such fair market rental value to be determined on the basis of
(a) the use being made of such Additional Space at the date hereof or (b) the
use being made of such Additional Space immediately prior to such term
expiration, whichever yields the higher value, and considering the terms and
conditions of this Lease), which fair market rental value shall be determined by
appraisal in accordance with the provisions of Sections 25.03 and 25.04 hereof;
provided, however, that Landlord shall be responsible for and bear all costs and
expenses incurred by either party with respect to such appraisal.

        (2) With respect to the space covered by the L.P. Lease, from and after
the expiration of the term thereof on June 30, 1990, additional rent shall be
payable hereunder for such space (i) for the four (4) year period from and after
July 1, 1990 and until June 30, 1994, at a rate equal to the then fair market
rental value thereof, (such fair market rental value to be determined on the
basis of (a) the use being made of such Additional Space at the date hereof or
(b) the use being made of such Additional Space immediately prior to such term
expiration, whichever yields the higher value, and considering the terms and
conditions of this Lease), which fair market rental value shall be determined by
appraisal in accordance with the provisions of Sections 25.03 and 25.04 hereof
and (ii) for each of the ensuing four (4) year period (i.e., July 1, 1994 and
until June 30, 1998), and the period from July 1, 1998 until September 30, 2001
(the Expiration Date of the original term of this Lease), at a rate equal to the
amount of additional rent payable hereunder with respect to such Additional
Space that was payable immediately prior to commencement of such period,
increased by ten (10%) percent of the annual rent payable as provided in clause
(i) above.

        2.04 Except as otherwise specifically set forth herein, this Lease shall
be deemed and construed to be a "net lease" and Tenant shall pay absolutely net
throughout the term of this Lease, the Fixed Rent, additional rent and all other
amounts payable by Tenant hereunder (collectively, "Rent"), free of any charges,
assessments, impositions, expenses or deductions of any kind, and under no
circumstances or conditions, whether now existing or hereafter arising, or
whether within or beyond the present contemplation of the parties, shall
Landlord be expected or required, except as otherwise specifically provided
herein, to make any payment of any kind whatsoever or be under any other
obligation or liability hereunder, and Tenant agrees to pay all costs and
expenses of every kind and nature


<PAGE>   8
 whatsoever arising from or in connection with the Demised Premises which may
arise or become due during, or with respect to, the period from and after the
date hereof and until the Expiration Date, and which, except for the execution
and delivery hereof, would have been payable by Landlord.

                                    ARTICLE 3
                  USE OF DEMISED PREMISES; THE EXISTING LEASES

        3.01 Subject to and in accordance with all applicable rules,
regulations, laws, zoning and other ordinances, statutes and requirements of all
governmental authorities and the Fire Insurance Rating Organization and Board of
Fire Insurance Underwriters, and any similar bodies, having jurisdiction
thereof, Tenant is hereby authorized to and shall be permitted to use the
Demised Premises for any lawful purpose, including, without limitation, as a
tennis and sport complex, health spa, office space, restaurant, night club,
cabaret, restaurant, garage and for the sale of sports and fitness equipment,
health foods, vitamins and juices; provided, however, that the use of the
Demised Premises shall at all times continue to be commensurate with, at least
comparable in quality to and harmonious with the uses made of buildings and
improvements in the vicinity of the Demised Premises. It is acknowledged by the
parties hereto that the portion of the Demised Premises (a) currently occupied
by L.P. Rent A Car, Inc. ("L.P."), a New York corporation, pursuant to the
provisions of a certain Lease, dated July 17, 1980 (the "L.P. Lease"), between
Vertical Club Corporation, as landlord, and L.P., as tenant, the landlord's
interest thereunder (together with the security deposit and accrued interest
thereon, if any, held by Landlord thereunder) having been assigned to Tenant on
even date herewith by an assignment agreement (the "Existing Leases Assignment
Agreement") in the form annexed hereto as Exhibit D, such premises comprising
certain basement space (exclusive of mechanical equipment areas) currently being
utilized as a garage operation are for the storage and rental of motor vehicles,
together with a ramp and driveway exit therefrom leading to and exiting upon
East 61st Street, New York, New York, all being more particularly described in
the L.P. Lease, and (b) currently occupied by Larama Corp. ("Larama"), a New
York corporation, pursuant to the provisions of a certain Lease, dated October
22, 1980 (the "Larama Lease" and, together with the L.P. Lease, being
collectively referred to herein as the "Existing Leases"), between Vertical Club
Corporation, as landlord, and Larama, as tenant, the landlord's interest
thereunder (together with the security deposit and accrued interest thereon, if
any, held by Landlord thereunder) having been assigned to Tenant on even date
herewith by the Existing Leases Assignment Agreement, such premises being
commonly referred to as the ground floor level of 333 East 60th Street, New
York, New York, and being more particularly described in the Larama Lease, is
currently being used as a nightclub, cabaret and for the conduct of a restaurant
business. Simultaneously with the delivery to Tenant of the Existing Leases
Assignment Agreement covering both of the Existing Leases in the manner as
aforesaid, Landlord shall use its reasonable efforts in order to cause each of
the tenants under the Existing Leases to designate Tenant as an additional named
insured on all policies of insurance maintained by each of the tenants under the
Existing Leases and to deliver certificates evidencing such coverage to Tenant.

        3.02 Landlord will use its reasonable efforts in order to cause to be
delivered to Tenant, simultaneously with the execution hereof, an estoppel
certificate ("Existing Lease Estoppel Certificate") executed by each of the
tenants under the Existing Leases in the form annexed hereto as Exhibit E, with
respect to each of their respective tenancies covering portions of the Demised
Premises pursuant to the Existing Leases. Landlord hereby represents and
warrants to Tenant with respect to each of the Existing Leases that (i) same is
in full force and effect, (ii) Landlord has received no written notice of any
default thereunder which remains in effect and is not aware of any fact or facts
which would now or with the giving of notice or the passage of time, or both, be
a default under the terms thereof (other than a default by Landlord in
performing general maintenance obligations), (iii) annexed hereto as Exhibit F
are true and complete copies thereof and all amendments thereto and there are no
other agreements, written or oral, between Landlord and either of the Existing
Tenants to amend or otherwise modify either of the Existing Leases and (iv)
there are no unpaid fees, commissions or other items of compensation owing to or
claimed by any brokers with respect to either of the Existing Leases.

        3.03 From and after the date hereof, Tenant, in its capacity as
successor landlord under each of the Existing Leases, shall have the sole and
absolute right to deal exclusively with each of the tenants under the Existing
Leases with respect to any and all matters concerning their respective
tenancies. Landlord acknowledges and agrees that


<PAGE>   9

Tenant is authorized, in its sole and absolute discretion, subject, however, to
the terms of the Existing Leases, to make whatever changes and alterations it
deems necessary or desirable in connection with its use of all or any portion of
the Demised Premises and the space covered by either or both of the Existing
Leases including, without limitation, the construction of a stairway connecting
the public lobby area of the Demised Premises to all lower levels thereof and
the entering into of any existing or future agreements between Tenant and either
or both of the tenants under the Existing Leases that Tenant deems appropriate
in connection with effecting the construction of such stairway; provided that
such changes and alterations do not impair the structural integrity or diminish
the value of the Demised Premises as a whole or cause any violation of any
applicable laws, ordinances or other requirements of the appropriate local
governmental authorities, and that the use of the Demised Premises and the space
affected by such changes and alterations continue to remain in compliance with
the provisions of Section 3.01 hereof.

        3.04 Landlord hereby covenants and agrees to indemnify and save harmless
Tenant from and against any and all liabilities, damages, suits, claims (whether
by either of the tenants under the Existing Leases or by brokers) and demands
(other than with respect to general maintenance obligations) arising from or in
connection with any and all matters pertaining to either of the Existing Leases
(or the security deposits thereunder) with respect to the period up to and
including the date of this Lease. Tenant hereby covenants and agrees to
indemnify and save harmless Landlord from and against any and all liabilities,
damages, suits, claims (whether for brokerage fees or otherwise), and demands in
connection with either of the Existing Leases (or the security deposits
thereunder), but only to the extent any such matters arise from and after the
date hereof and result from conditions or circumstances (other than conditions
requiring the performance of general maintenance obligations) which did not
exist prior to the date hereof (i.e., the date of this Amended and Restated Net
Operating Lease).

        3.05 Except as otherwise provided in Article 9 hereof with respect to
Existing Conditions (as defined in Article 9), Tenant agrees not to use or
occupy or permit the Demised Premises to be used or occupied, nor do or permit
anything to be done in or on the Demised Premises, or any part thereof, in a
manner that would in any way violate any Certificate of Occupancy in effect with
respect to the Demised Premises, make void or voidable any insurance then in
force with respect thereto, make it impossible to obtain fire or other insurance
thereon required to be furnished hereunder by Tenant, cause or be likely to
cause structural injury to any of the Improvements or constitute a public or
private nuisance or waste.

        3.06 Neither any action or inaction by Landlord nor any of the
provisions contained herein shall be deemed or construed to indicate that
Landlord has granted to Tenant any right, power or permission to do any act or
to enter into any agreement that may create, give rise to, or be the foundation
for, any right, title, interest, lien, charge or other encumbrance upon the
estate of Landlord in and to the Demised Premises.

                                    ARTICLE 4
                                PAYMENT OF TAXES

        4.01 As used herein, the term "Taxes" shall mean all taxes, assessments,
water charges and sewer rents, rates and charges, transit taxes, charges for
public utilities, excises, levies, vault charges (if any), license and permit
fees and other governmental charges, general and special, ordinary and
extraordinary, foreseen or unforeseen, of any kind and nature whatsoever which
at any time during the term of this Lease may be assessed, levied, confirmed,
imposed upon or become a lien against the Demised Premises, or any portion
thereof, and which are assessed and are, or become, a lien during the term of
this Lease, and such franchises as may be appurtenant to the use of the Demised
Premises, this transaction or any document to which Tenant is a party in
connection with any of the foregoing matters.

        4.02 As additional rent, Tenant shall pay, as the same shall become due
and payable, and before any fine, penalty, interest or other cost accrues
thereon as a result of the non-payment thereof, all Taxes which are assessed and
are, or become, a lien during the term of this Lease with respect to the Main
Parcel. Tenant shall, promptly after payment, deliver to Landlord receipts
evidencing payment of all such Taxes. Tenant may pay any Taxes in installments,
if payment may be so made, without fine or penalty. Landlord shall furnish to
Tenant bills for Taxes


<PAGE>   10

upon receipt, and no obligation of Tenant under this Section 4.02 shall arise
prior to Tenant's receipt thereof. However, Landlord shall have the right to
cause bills for Taxes to be sent by the appropriate governmental authority
directly to Tenant, in which event Landlord shall not be obligated to furnish
same to Tenant in the manner provided by the immediately preceding sentence.
"After payment of any Taxes, however, Tenant shall have the right to proceed, in
good faith, to contest such Taxes or tax liens against the Demised Premises, or
any part thereof, or the validity thereof, by appropriate legal proceedings.

        4.03 At the request of Tenant, Landlord shall be required to join in any
and all actions or proceedings referred to in the preceding Section 4.02, in
which event any such action or proceeding may be taken by Tenant in the name of,
but without expense to Landlord. Tenant shall serve notice upon Landlord of
Tenant's intention to take such action or initiate such proceeding, and
Landlord's failure to join in such action or proceeding within ten (10) days
from the date of Landlord's deemed receipt of Tenant's notice in the manner
provided by Section 29.01 hereof shall thereupon constitute the immediate
authorization and appointment by Landlord of Tenant to act as Landlord's true
and lawful representative and attorney-in-fact, coupled with an interest, with
full power and authority in Landlord's name, place and stead to make, execute,
sign, acknowledge, and swear, deliver, file and record at the appropriate
governmental or other offices or with any appropriate parties, such documents as
may be reasonably required by the subject matter of such notice. In connection
therewith, Tenant shall indemnify and hold harmless Landlord from and against
any and all loss, claim, damage, cost or expense, including, without limitation,
reasonable attorneys' fees and disbursements, that Landlord may incur by reason
of any such action or proceeding or any instrument or document executed by
Landlord, or by Tenant on behalf of Landlord, pursuant to this Section 4.03. The
provisions of this Section 4.03 shall not be construed to require Tenant to pay
any Taxes that Tenant is not otherwise obligated to pay under the terms of this
Lease.

        4.04 If Tenant shall at any time fail to pay Taxes when due, Landlord
shall have the right to require Tenant to enter into an escrow arrangement with
and to pay over to the Trustee (as that term is defined in Section 11.03
hereof), on a monthly basis in advance, an amount equal to one-twelfth (1/12) of
the annual Taxes. If Tenant shall thereafter promptly make payment of Taxes for
the next ensuing one (1) year period in accordance with the requirements of this
Lease, such escrow arrangement shall be terminated, subject to reinstatement if
Tenant shall subsequently fail to pay such Taxes as aforesaid. It is understood
that any amounts paid to the Trustee shall be held in trust and applied to the
payment of the Taxes in question and, while held by the Trustee, shall be
invested in the manner described in Section 11.03 hereof, and that interest
accruing thereon shall be held by the Trustee for the benefit of Tenant.

        4.05 Nothing contained herein shall require Tenant to pay income taxes
assessed against Landlord, or any capital levy, corporation franchise, excess
profits, estate, succession, inheritance, transfer or New York State gains taxes
of Landlord, unless such taxes are imposed or levied or assessed as a total or
partial substitute for, or in lieu of, any other Taxes required to be paid by
Tenant pursuant to Section 4.02, in which event same shall be deemed to
constitute Taxes and shall be paid by Tenant.

                                    ARTICLE 5
                                   PRORATIONS

        All utility costs and similar items of expense pertaining to the Demised
Premises for the year of termination of this Lease shall be prorated between
Landlord and Tenant as of the Expiration Date.

        Pursuant to the terms of the Prior Lease, Tenant was responsible for the
payment of seventy-nine (79%) percent of Taxes pertaining to the Demised
Premises, and Landlord was required to pay twenty-one (21%) percent of all such
Taxes. An appropriate adjustment and proration shall be made as of the date
hereof in order to reflect the reallocation of the prospective responsibilities
of the parties hereto with respect to the payment of such Taxes (ie., Tenant
shall hereafter be responsible for 100% of Taxes attributable to the Main
Parcel) and with respect to any other amounts payable, owing or otherwise held
under each of the Existing Leases.


<PAGE>   11

                                    ARTICLE 6

                   CONDITION AND CARE OF THE DEMISED PREMISES;
                      REPAIRS, IMPROVEMENTS AND ALTERATION

        6.01 Except and to the extent otherwise expressly provided in Section
6.02, Tenant will take good care of and maintain the Demised Premises and all
roadways, sidewalks and curbs in, on, adjacent and appurtenant thereto, in good
order and repair at Tenant's sole cost and expense, and shall promptly remove
all accumulated snow, ice and debris from any and all roadways, sidewalks, and
curbs located upon or appurtenant to the Demised Premises and from any and all
other sidewalks and curbs adjacent to the Demised Premises. Tenant will make all
other necessary repairs and replacements to the Demised Premises, whether
ordinary or extraordinary, foreseen or unforeseen, structural or non-structural,
during the term of this Lease and will keep the same in good condition and
repair and will, at the expiration or sooner termination of this Lease, return
the Demised Premises to Landlord in good condition and repair, excepting
ordinary wear and tear, damage and destruction by fire or other casualty covered
by insurance and any material matters or conditions caused by or resulting from
the willful acts of Landlord, or any matters existing at the time of a
termination of this Lease by Landlord pursuant to the provisions of Section
25.05 hereof.

        In connection with the foregoing, Landlord will maintain in good
condition and repair the roof of the Adjacent Parcel, and will afford Tenant
reasonable access (and immediate access in the event of a system breakdown or
other operating emergency in order to effect service or other repairs, which
repairs and other costs incurred by Tenant in connection therewith shall be at
Tenant's expense), to the air conditioning equipment, restaurant exhaust system
equipment, chilling units and other equipment servicing the Demised Premises,
now or hereafter situated on the roof of the Adjacent Parcel as well as pipes
and other suspended mechanical apparatus running across the air space over the
rear yard of the Adjacent Parcel. In connection with the foregoing, Tenant shall
be responsible for the repair of any damage caused by Tenant or its equipment to
the roof of the Adjacent Parcel and the compliance with all legal requirements
applicable to such equipment and the maintenance thereof on the roof of the
Adjacent Parcel.

        6.02 Except as may otherwise be expressly agreed by Landlord and Tenant,
Landlord shall not under any circumstances be required to build any improvements
on the Demised Premises, or to make any repairs, replacements, alterations or
renewals of any nature or description to the Demised Premises or to any of the
Improvements, whether interior or exterior, ordinary or extraordinary,
structural or non-structural, foreseen or unforeseen, or to make any expenditure
whatsoever in connection with this Lease or to inspect or maintain the Demised
Premises in any way.

        6.03 In the event of any new construction, repair, changes or
alterations by Tenant to the Demised Premises, the Rent payable under this Lease
shall not be increased, reduced or abated in any manner whatsoever.

        6.04 Tenant shall have the right at any time and from time to time
during the term of this Lease, at its cost and expense, to make whatever
structural and non-structural changes and alterations with respect to the
Demised Premises (inclusive of Additional Spaces) as are reasonably required in
order to maintain and use the same in a manner that is consistent with the
requirements described in Article 3 hereof, and to otherwise continue to use all
those portions of the roof of the Adjacent Parcel presently used by Tenant and
in a manner that is consistent with its present usage and of the Demised
Premises without additional rent or other charge therefor (all of the foregoing
are hereinafter collectively called "Tenant Changes" and any of the foregoing is
called a "Tenant Change"), subject, however, in all cases to the following:

                (i) Landlord shall receive prior notice of any specific Tenant
        Change involving an estimated cost of more than One Hundred Thousand
        ($100,000) Dollars; provided, however, that such prior notice shall not
        be required in the event of an emergency, but will be provided to
        Landlord as soon thereafter as is reasonably possible. Such amount (the
        "Base Amount") shall be proportionately increased or decreased (the
        "Adjusted Amount") for each calendar year during the term of this Lease,
        commencing with the Calendar Year 1986, by an amount (the "CPI


<PAGE>   12

Adjustment") computed in accordance with the percentage increase or decrease in
the Consumer Price Index for all Urban Consumers, New York and the Northeast
Region, issued and published by the Bureau of Labor Statistics of the United
States Department of Labor (1967=100) (the "CPI"); if the CPI is not available
then based upon a reasonable substitute or successor index, or, if such a
successor or substitute index is not available or may not lawfully be used for
the purposes stated herein, then based upon a reliable governmental or other
non-partisan publication, selected by Tenant, evaluating changes in the cost of
living or purchasing power of the consumer dollar, if such a publication is
available and may be lawfully used for the purposes stated herein. For the
purposes of calculating fluctuations in the CPI, the calendar year 1985 shall be
considered to be the base year (the "Base Year").

                The Adjusted Amount for each calendar year during the term of
        this Lease shall be determined as follows: the Base Amount shall be
        increased or decreased to equal the product obtained by multiplying (a)
        the Base Amount by (b) a fraction, the numerator of which is the average
        monthly CPI for the calendar year immediately preceding the calendar
        year in question, and the denominator of which is the average monthly
        CPI for the Base Year.

                (ii) No Tenant Change shall be undertaken until Tenant shall
        have procured and paid for, so far as the same may be required from time
        to time, all necessary permits and authorizations of all municipal
        departments and governmental subdivisions having jurisdiction thereof;
        and, at Tenant's expense, Landlord shall join in the application for any
        such permits and authorizations whenever Tenant determines such action
        to be necessary. Landlord's failure to join in such application within
        ten (10) days after Landlord's deemed receipt pursuant to Section 29.01
        of such application and requests Landlord to join therein, shall
        thereupon constitute the immediate authorization and appointment by
        Landlord of Tenant as Landlord's true and lawful representative and
        attorney-in-fact, coupled with an interest, with full power and
        authority in Landlord's name, place and stead to make, execute, sign,
        acknowledge, and swear, deliver, file and record at the appropriate
        governmental or other offices or with any appropriate parties, such
        documents as may be reasonably required by the subject matter of such
        notice. In connection therewith, Tenant shall indemnify and hold
        harmless Landlord from and against any and all loss, claim, damage, cost
        or expense, including, without limitation, reasonable attorneys' fees
        and disbursements, that Landlord may incur in connection with the
        application for and issuance of such permits and authorizations, any
        work performed pursuant thereto and any instrument or document executed
        by Landlord, or by Tenant on behalf of Landlord, pursuant to this
        subdivision (ii).

                (iii) Any Tenant Change involving an estimated cost of more than
        One Hundred Thousand ($100,000) Dollars, as adjusted by the CPI
        Adjustment, shall be conducted under the supervision of a licensed
        architect or engineer selected by Tenant and shall be made in accordance
        with detailed plans and specifications (the "Plans and Specifications")
        and cost estimates prepared by such architect or engineer. Promptly
        after request by Landlord, Tenant shall cause copies of the Plans and
        Specifications to be delivered to Landlord, and upon Landlord's request
        shall keep Landlord reasonably informed of the progress of any such work
        performed in connection with any such Tenant Change.

                (iv) Any Tenant Change shall be made promptly and in a good
        workmanlike manner and in compliance with all applicable permits and
        authorizations and building and zoning laws, ordinances, orders and
        requirements of all federal, state and municipal governments and the
        appropriate departments, commissions, boards and officers thereof; and
        in accordance with the orders, rules and regulations of the Board of
        Fire Insurance Underwriters and any other body hereafter exercising
        similar functions having or asserting jurisdiction over the Demised
        Premises.

                (v) Tenant shall carry all necessary worker's compensation
        insurance covering all persons employed in connection with any work
        performed in connection with any Tenant Change and with respect to which
        death or bodily injury claims could be asserted against Landlord,
        Tenant, the Demised Premises or the Improvements, and general liability
        and property damage insurance for the mutual benefit of Tenant and
        Landlord with limits of not less than those required to be carried
        pursuant to Article 10 hereof shall be maintained by Tenant, at Tenant's


<PAGE>   13

        sole cost and expense, at all times when any work is in process in
        connection with any new construction, repair, change or alteration and
        shall furnish Landlord with evidence of any and all such coverage.

                (vi) No Tenant Change shall impair the structural integrity or
        diminish the value of any building comprising a part of the Demised
        Premises. The building of additional stories onto the Demised Premises
        or any part thereof or the creation of any additional floor area therein
        (as that term is used in the Zoning Resolution) is specifically
        prohibited under the terms of this Lease.

                (vii) All Tenant Changes that become permanently affixed to the
        Demised Premises shall, upon the expiration or prior termination of this
        Lease and all renewal terms hereof, become the property of Landlord.

                                    ARTICLE 7
                                THE 328 EASEMENT

        7.01 Simultaneously with the execution hereof, 328, as the fee owner of
a certain parcel of land, together with the improvements situated thereon, and
being commonly known as 328 East 61st Street, New York, New York (the "Adjacent
Parcel"), which parcel is contiguous to the Demised Premises (the Elevator Shaft
Parcel constituting a portion thereof), has executed, acknowledged and delivered
to Tenant for recordation in the City Register's Office, an easement agreement
(the "328 Easement Agreement") in the form annexed hereto as Exhibit G and made
a part hereof, pursuant to which, among other matters, 328 has granted to
Hirschfeld, as well as to Tenant, certain easements, for so long as this Lease
shall remain in effect (which easements are collectively referred to herein as
the "328 Easement") in order to allow the continued and uninterrupted (i)
encroachment onto the portion of the Adjacent Parcel constituting the Elevator
Shaft Parcel of a certain elevator shaft structure constituting a part of the
Demised Premises, to the extent more particularly described in the 328 Easement
Agreement; (ii) access to and use of those certain fire stairs that lead down to
the rear yard of the Adjacent Parcel, fire doorway access to such stairway on
the second and third floors and at the ground level of the Demised Premises;
(iii) ingress to and egress from the rear yard of the Adjacent Parcel; and (iv)
ingress to and egress from (through the existing roof top accessway from the
Demised Premises) and use of, the roof of the Adjacent Parcel for the purpose of
operating, maintaining, installing or removing any and all air-conditioning
equipment, restaurant exhaust system equipment, chilling units and other
equipment servicing the Demised Premises and being now situated on such roof (as
well as pipes and other suspended mechanical apparatus running across the air
space over the rear yard of the Adjacent Parcel), all as more particularly
identified and described in the 328 Easement Agreement. The 328 Easement shall
run with the land and shall inure to the benefit of all future owners, tenants
and subtenants of the Main Parcel for so long as this Lease shall remain in full
force and effect. In case of any conflict between the provisions of this Section
7.01 and the provisions of the 328 Easement Agreement, the provisions of the 328
Easement Agreement shall control.

                                    ARTICLE 8
                                  ZONING RIGHTS

        8.01 Landlord expressly retains all excess floor area and/or development
rights (collectively, the "Excess Zoning Rights") determined pursuant to the
Zoning Resolution of the City of New York, effective as of December 15, 1961, as
amended on August 17, 1977 (as so amended, or as the same may hereafter be
amended, the "Zoning Resolution") that are appurtenant to the Demised Premises
and based upon the Improvements existing thereon as of the date hereof, and
Tenant shall have no entitlement thereto. Tenant shall, upon reasonable request
by Landlord, but at no cost to Tenant, take such actions and execute such
documents as Landlord may reasonably deem necessary or desirable in order to
confirm the continued ownership and retention by Landlord of the Excess Zoning
Rights.

        8.02 (a) Simultaneously with the execution and delivery of this Lease,
the parties hereto shall join in the execution (and Landlord shall have
theretofor caused all other necessary parties in interest to either join in or
duly waive their right to join in) of a Zoning Lot and Development Merger
Agreement, a Zoning Lot Description and Ownership Statement and a Declaration of
Zoning Lot Restrictions, as described in Section 12-10 of the Zoning Resolution.
Each of the foregoing documents shall be duly filed and recorded with the
appropriate local


<PAGE>   14

governmental authorities in order to validly create or ratify the continued
existence of a single zoning lot with respect to the Demised Premises and the
328 Site.

        Landlord's use of the Excess Zoning Rights shall be expressly limited to
the specific purpose of erecting improvements (the "East Tower Improvements") on
that certain parcel of land, together with the improvements situated thereon,
and commonly known as 336 East 61st Street, New York, New York (the "336 Site"),
as provided by this Section 8.02. In connection with the construction of the
East Tower Improvements, Landlord expressly covenants and agrees that it shall
not be entitled to (i) erect any structure on, under, across or over the air
space over the boundary lot line on all sides of the Demised Premises, or any
portion thereof, or otherwise erect any structure on the 336 Site which
encroaches upon the Demised Premises, or any portion thereof; (ii) alter or
enlarge any structure on the 336 Site in a manner which encroaches upon the
Demised Premises, or any portion thereof; (iii) use any portion of the
improvements on the Demised Premises for "party wall" purposes; or (iv) enter
upon the Demised Premises, or any portion thereof (except to such extent as may
be reasonably required for the construction work on the 336 Site for inspection
purposes only and such limited entry shall only be permitted after the business
hours of the Demised Premises or on reasonable advance notice during business
hours, or in case of emergency, in which event prior notice will not be
required). Landlord expressly covenants and agrees that the construction of the
East Tower Improvements shall be conducted in such manner so as not to increase
any costs or expenses borne by Tenant with respect to the operation or
maintenance of the Demised Premises, impair in any way the structural support of
the Demised Premises or unreasonably interfere with the peaceable and
uninterrupted conduct of Tenant's business at the Demised Premises, (e.g.,
Landlord shall not cause the entrance to the Demised Premises or the streets in
the vicinity thereof to be unreasonably blocked by trucks, vans or other
vehicles whether in connection with the delivery of construction materials, for
parking purposes or otherwise; Landlord shall not allow any scaffolding or other
platform or structure to encroach unreasonably upon the entrance to the Demised
Premises or any portion thereof; Landlord shall take reasonable steps in order
to prevent any action on its behalf or by its agents, employees, and contractors
that might cause the falling of any dirt or debris onto the roof or any other
portion of the Demised Premises; and Landlord shall not allow any temporary or
other structures to be erected unreasonably near the entrance to the Demised
Premises). Landlord shall indemnify and save harmless Tenant from and against
any and all liability, loss, cost, claim, injury, damage or other expense of any
nature whatsoever that may be claimed or asserted against Tenant or otherwise
suffered by any member (or guests of any member) of the health club or other
facilities operated at the Demised Premises resulting from the unreasonable
interference with the use of the Demised Premises by any such parties arising
from or in connection with any construction work performed by or on behalf of
Landlord with respect to the East Tower Improvements.

                                    ARTICLE 9
                              COMPLIANCE WITH LAWS

        9.01 Except with respect to (a) any current or potential future
violation of the existing Certificate of Occupancy for the Building which
results solely by reason of the use and operation of the Demised Premises as a
health club on a basis substantially similar to the manner of use and operation
thereof at the date hereof (excluding, however, any such violation resulting
from alterations or physical changes heretofore or hereafter made by Tenant in
the Demised Premises) and (b) any currently existing violation of applicable
governmental laws or rules arising from the actual or purported status, prior to
the date hereof, of the Demised Premises as constituting a part of a single
zoning lot (together with the Adjacent Parcel) (collectively, "Existing
Conditions") (which matters neither Tenant nor Landlord shall in any way be
obligated to cure), Tenant shall comply with all orders, regulations, rules and
requirements of every kind and nature relating to the Demised Premises, now or
hereafter in effect, of all governmental authorities, whether they be usual or
unusual, ordinary or extraordinary, or whether they or any of them relate to any
structural changes or requirements of whatever nature, or to changes or
requirements incident to or as the result of any use or occupancy thereof or
otherwise, including all orders, rules and regulations of the national and local
boards of fire underwriters or any other body exercising similar functions. In
the event that as a result of the failure of either of the parties hereto to
effect the cure of any Existing Conditions, any governmental authority with
jurisdiction over the Demised Premises determines that the continued use of the
Demised Premises by Tenant in the furtherance of its business affairs, as
conducted at the date hereof, is unlawful or must be further restricted in any
material and adverse


<PAGE>   15

way, then Tenant shall have the right to cancel this Lease on not less than
thirty (30) days prior written notice to Landlord, and at the expiration of such
time period, this Lease and the term hereof shall cancel and terminate as if
such date was the Expiration Date of this Lease; provided, however, that
Landlord shall be entitled to elect, at any time prior to expiration of the
aforesaid thirty (30) day period, by notice to Tenant, to cure any such Existing
Conditions and, if such cure is effected prior to the expiration of said thirty
(30) day period, or if such Existing Condition is not susceptible of being cured
within such thirty (30) day period and Landlord commences to cure and diligently
prosecutes such cure to completion within a reasonable period thereafter, then
Tenant will not be entitled to so cancel this Lease. Notwithstanding the
foregoing, Landlord expressly agrees that the status of any and all Existing
Conditions with respect to the Demised Premises (and any actions that may
hereafter be taken by any govermental authority in connection therewith) shall
not constitute a basis for declaring the occurrence of an Event of Default on
the part of Tenant hereunder. In addition, Landlord covenants and agrees not to
take any action with respect to any Existing Condition that might in any way
interfere with Tenant's use of the Demised Premises without the prior written
consent and express authorization of Tenant.

        Tenant shall procure, pay for and maintain all permits, licenses and
other authorizations necessary to operate the Demised Premises, except as
otherwise provided herein, and shall pay all costs and expenses incidental to
complying with the foregoing matters. So long as the actions of Tenant are not
reasonably anticipated to result in a penalty being imposed against the Demised
Premises, or any portion thereof, or any penalty or civil or criminal liability
against Landlord, or subject the Demised Premises to forfeiture, or cause the
Demised Premises to be closed on either a temporary or permanent basis, Tenant
shall have the right to contest or review any such order referred to in this
Section 9.01 by legal proceedings or in such manner as Tenant may deem advisable
and may have any such order cancelled, removed or revoked, without actual
compliance therewith. If any such actions or proceedings are instituted by
Tenant, they shall be instituted and conducted diligently and in good faith at
the expense of Tenant and without cost to Landlord, and in connection with any
such contest with respect to the validity or application, in whole or in part,
of any such legal requirements, Tenant may, subject to the conditions set forth
in the second sentence of this paragraph, postpone compliance therewith pending
the determination of such contest, but shall be required to bond or post other
equivalent security with the Trustee, to the extent of at least one hundred ten
(110%) percent of the contested amount, in order to protect the interest of
Landlord hereunder. In the event of any default by Tenant under this section (or
if any of the conditions set forth in the second sentence of this paragraph
cease to be complied with), Landlord may comply with any such order, regulation,
rule or requirement and the cost and expense of so doing may be paid by Landlord
and shall be repaid to Landlord by Tenant on demand, as additional rent due
hereunder, together with interest thereon at a rate equal to two (2%) percent
over the rate of interest that is announced from time to time by Citibank, N.A.
as its "prime" or "base" rate (such interest rate being calculated as aforesaid,
is hereinafter referred to as the "Penalty Rate"); and if Tenant shall fail
promptly so to do, Landlord shall be entitled to obtain such reimbursement and
interest from the Trustee out of the security deposited with it.

        9.02 At the request of Tenant, Landlord shall be required to join in any
and all actions or proceedings referred to in the preceding Section 9.01, in
which event any such action or proceeding may be taken by Tenant in the name of,
but without expense to, Landlord. Tenant shall serve notice upon Landlord of
Tenant's intention to take such action or initiate such proceeding, and
Landlord's failure to join in such action or proceeding within ten (10) days
from the date of Landlord's deemed receipt of Tenant's notice (in the manner
provided by Section 29.01 hereof) shall thereupon constitute the immediate
authorization and appointment by Landlord of Tenant to act as Landlord's true
and lawful representative and attorney-in-fact, coupled with an interest, with
full power and authority in Landlord's name, place and stead to make, execute,
sign, acknowledge, and swear, deliver, file and record at the appropriate
governmental or other offices or with any appropriate parties, such documents as
may be reasonably required by the subject matter of such notice. In connection
therewith, Tenant shall indemnify and hold harmless Landlord from and against
any and all loss, claim, damage, cost or expense, including, without limitation,
reasonable attorneys' fees and disbursements, that Landlord may incur in
connection with any such actions or proceedings, any failure of Tenant to comply
with any such order or requirement during such contest and any instrument or
document executed by Landlord, or by Tenant on behalf of Landlord, pursuant to
this Section 9.02. Nothing contained in this Section 9.02 shall be construed as
obligating either Landlord or Tenant to take any action with respect to any of
the Existing Conditions.



<PAGE>   16

                                   ARTICLE 10

                          INDEMNIFICATION OF LANDLORD;
                             LIMITATION OF LIABILITY

        10.01 Except as otherwise provided herein, Tenant shall indemnify and
save Landlord harmless from and against, and shall reimburse Landlord for, all
liabilities, damages, fines, penalties, claims, costs, and expenses, whether
found in tort, in contract or otherwise, including reasonable attorneys' fees
and disbursements, which may be imposed upon or incurred or paid by or asserted
against Landlord as a result of (but without the fault or negligence of
Landlord) the use, misuse, occupancy, possession or unoccupancy of the Demised
Premises or negligent or tortious act by Tenant or any other person claiming by,
through or under Tenant or their respective agents, employees, licensees,
invitees or guests, any Tenant Change and anything done in, on or about the
Demised Premises or any part thereof in connection therewith, any accident,
injury, death or damage to any person or property occurring in, on or about the
Demised Premises or any portion thereof, or any failure on the part of Tenant to
perform or comply with any of the provisions contained in this Lease on its part
to be performed or complied with. Tenant shall, at its own cost and expense,
resist or defend against any and all such actions, claims and demands and shall
indemnify Landlord for all costs, expenses and liabilities Landlord may incur in
connection therewith if Tenant fails to satisfy its obligations hereunder.

        10.02 Except as otherwise provided herein, Tenant shall fully and
exclusively control the Demised Premises and be responsible for the condition,
operation, repair, replacement, maintenance and management of the Demised
Premises.

        10.03 If at any time during the term of this Lease Landlord shall fail
to perform any covenant or obligation on its part to be performed hereunder or
shall otherwise incur any liability to Tenant with respect to any matter
pertaining to the Demised Premises, and Tenant shall recover a money judgment
against Landlord with respect thereto, such judgment shall be satisfied only (i)
out of the proceeds of sale produced upon execution of such judgment and levy
thereon against Landlord's interest in the Demised Premises and (ii) by judicial
attachment or other legal process with respect to the rents or other income from
the Demised Premises receivable by Landlord. The provisions of this Section
10.03 are not intended to relieve Landlord from the performance of any of its
obligations hereunder, but rather to limit Landlord's liability in the case of
the recovery of a judgment against it, as aforesaid, nor shall any of the
provisions of this Section be deemed to limit or otherwise affect Tenant's right
to seek enforcement of the remedies of injunctive relief or specific
performance.

                                   ARTICLE 11
                                    INSURANCE

        11.01 Tenant shall, throughout the term of this Lease, at its own cost
and expense (including all costs and expenses of recovery, if any), obtain and
maintain in full force and effect and in the name of Tenant, Landlord and, if so
requested by Landlord, the Fee Mortgagee, as their respective interests may
appear:

                (i) insurance against loss or damage by fire or other casualty,
        with all risk (including vandalism and malicious mischief) "extended
        coverage" and such other risks or hazards as are customarily insured
        against in the applicable locality at the time in connection with
        premises of similar type to the Demised Premises, including, without
        limitation, damage by lightning, hail, explosion, windstorm, tornado,
        cyclone, riot, disorder or civil commotion, smoke damage, vandalism and
        malicious mischief (when obtainable and if not included in "extended
        coverage"). Such insurance shall be in an amount sufficient to prevent
        Landlord or Tenant from becoming a co-insurer within the terms of the
        applicable policies, but in no event shall such policies be in an amount
        of less than ninety (90%) percent of the full replacement value of the
        Demised Premises. Such insurance shall contain inflation guard and
        increased cost of construction endorsements covering the Demised
        Premises (including, without limitation, the structure of the Building)
        and all replacements, additions and improvements


<PAGE>   17

        thereof, and of all fixtures, elevators, equipment and other personal
        property therein, in amounts sufficient to prevent Landlord or Tenant
        from becoming a co-insurer under the terms of the applicable policies,
        and in no event shall any such policy be in an amount less than ninety
        (90%) percent of the full replacement cost thereof from time to time;

                (ii) general liability insurance written on a so-called
        "Comprehensive" General Liability Insurance Form for the mutual benefit
        of Landlord, Tenant and the Fee Mortgagee, covering the Demised Premises
        against claims on account of bodily injury, death and property damage
        incurred upon or about the Demised Premises, inclusive of the elevators
        therein, such insurance to be written with limits of not less than Ten
        Million ($10,000,000) Dollars for death or injuries to one or more
        persons from one occurrence, and not less than Three Million
        ($3,000,000) Dollars for damage to property;

                (iii) adequate explosion insurance with respect to steam and
        pressure boilers and similar apparatus, if any, located on the Demised
        Premises;

                (iv) insurance against loss or damage to the Demised Premises
        resulting from water damage, if reasonably obtainable;

                (v) war risk insurance as and when such insurance is obtainable
        from the United States Government or any agency or instrumentality
        thereof, and a state of war or national public emergency exists or
        threatens, in an amount not less than the full insurable value of the
        Demised Premises;

                (vi) worker's compensation insurance subject to statutory limits
        or better in respect of any work or other operations on or about the
        Demised Premises;

                (vii) business interruption insurance, in an amount sufficient
        to enable Tenant to pay all rental amounts that are from time to time
        due to Landlord with respect to the Demised Premises for a period of one
        (1) year;

                (viii) such other types of insurance with respect to the Demised
        Premises and in such amounts as Landlord from time to time may
        reasonably request against such other insurable hazards which at the
        time in question are commonly insured against (and are obtainable for
        the Demised Premises at commercially reasonable rates) in the case of
        property similar to the Demised Premises; and

                (ix) during the performance of any construction with respect to
        any Tenant Change at a cost in excess of One Hundred Thousand ($100,000)
        Dollars, subject to the CPI Adjustment, broad form builder's all-risk
        insurance, as calculated on a completed value basis.

        11.02 All such insurance shall:

                (i) be obtained from and maintained with reputable and
        financially sound insurance company(ies) authorized to issue such
        insurance in the State of New York;

                (ii) be reasonably satisfactory to Landlord and to the Fee
        Mortgagee;

                (iii) contain an agreement by the insurer that it will not
        cancel or modify any such policy except after fifteen (15) days prior
        written notice to Landlord and the Fee Mortgagee;

                (iv) provide that any loss otherwise payable thereunder shall be
        payable notwithstanding any act or negligence of Landlord or Tenant
        which might, absent such agreement, result in a forfeiture of all or
        part of the payment of such loss; and


<PAGE>   18

                (v) state on the face of the policy that Landlord is not and
        shall not become liable for payment of premiums thereunder.

        11.03 All proceeds payable pursuant to any of the policies referred to
in this Article 11, on account of the loss involved, except any such proceeds
payable pursuant to general liability insurance coverage directly to an injured
party, as described in Section 11.01(ii) hereof, shall be payable over to a
trustee (the "Trustee"), who shall be an Institutional Lender (as defined in
Section 13.01 hereof) other than the Fee Mortgagee and appointed by Tenant (and
whose costs and expenses shall be borne by Tenant), it being agreed that such
proceeds shall be held in trust by the aforesaid Trustee for the purposes hereof
and shall be invested by the Trustee in certificates of deposit or treasury
bills, as the Trustee shall in its reasonable discretion determine, and any
interest which accrues thereon or any amounts earned as a result of such
investment shall become part of the proceeds, after subtracting therefrom an
administrative fee payable to the Trustee, as well as any costs and expenses
paid or incurred by the Trustee in connection with its investment of the
proceeds. In the case of reconstruction of the Demised Premises, such proceeds
shall be disbursed by the Trustee in the manner provided by Section 12.03
hereof.

        11.04 Prior to the expiration of any such insurance policy, Tenant shall
deliver to Landlord a certificate evidencing the replacement or renewal thereof.
Tenant shall furnish Landlord and the Fee Mortgagee with duplicate original(s)
or original certificate(s), together with true copy(ies) of all such insurance
policies, including renewal and replacement policy(ies), together with written
evidence that the premiums therefor have been paid. It is understood and agreed
that said policies may be blanket policies covering other locations operated by
Tenant, its affiliates or subsidiaries, provided that such blanket policies
otherwise comply with the provisions of this Article 11, and provided further
that such policies specifically allocate coverage for the Demised Premises in
accordance with the requirements of this Article 11.

        11.05 Tenant shall not take out separate insurance concurrent in form or
contributing in the event of loss with that required to be furnished by Tenant
under Article 11 of this Lease, unless Landlord and any Fee Mortgagee designated
by Landlord are included as named insured, with loss payable as provided in this
Article 11. Tenant shall immediately notify Landlord whenever any such separate
insurance is taken out and shall deliver to Landlord duplicate original(s)
thereof, or original certificate(s) evidencing the same with true copies
thereof, as provided in this Lease.

                                   ARTICLE 12
                              DAMAGE OR DESTRUCTION

        12.01 If any portion of the Demised Premises is damaged or destroyed by
fire or other cause during the term of this Lease, Tenant shall promptly give
notice thereof to Landlord, and Tenant shall, except as otherwise provided
herein, be obligated to repair, replace and rebuild (collectively, "Repair") the
same, notwithstanding the sufficiency or availability of insurance proceeds and,
if the insurance proceeds received by Tenant with respect to any such damage or
destruction of the Demised Premises are not sufficient to Repair the Demised
Premises (or damaged portion thereof), then Tenant will be required to most the
deficiency with the Trustee and such amounts shall be disbursed for
reconstruction purposes pursuant to Section 12.02 hereof. In connection
therewith, the Demised Premises shall be restored at least to the extent of the
value, and as nearly as possible to the character and size dimensions (e.g.,
square footage) of the property involved, as it was immediately before the loss,
to the extent permissible by applicable zoning regulations. Notwithstanding the
foregoing, in the event of any such damage or destruction which affects more
than twenty five (25%) percent of the Demised Premises and which shall take
place at any time during the five (5) year period immediately preceding the
Expiration Date of this Lease, and, if Tenant shall then be in compliance with
the insurance requirements of Section 11.01 hereof and shall not have taken or
failed to take any action which results in its insurance carrier being entitled
to and in fact disclaiming liability for the loss in question, then Tenant may
elect not to commence or otherwise complete the Repair of the damaged or
destroyed portion of the Demised Premises and, in such event, Tenant's sole
obligation to Landlord will be to deliver the Demised Premises to Landlord,
together with an assignment of Tenant's right to receive any insurance proceeds
in respect of such damage or destruction to all or any portion of the Demised
Premises and any insurance proceeds


<PAGE>   19

in Tenant's possession and received in respect of the damage or destruction in
question, net of any and all sums theretofore expended by Tenant, if any, in
connection with the Repair of such condition, in which event, this Lease shall
be deemed terminated and of no further force and effect. Any Repairs performed
by Tenant in connection with this Article 12 shall be done in a first class
workmanlike manner, and in accordance with the provisions of Article 6 hereof.

        12.02 Subject to the terms of the currently existing Fee Mortgage (as
defined and specifically referred to in Section 21.01 hereof), for the purpose
of paying towards the cost of such Repair, the Trustee shall, pursuant to the
terms of Section 11.03 hereof, hold in trust all insurance proceeds which may be
received by said Trustee and any amount deposited by Tenant with the Trustee
pursuant to Section 12.01, and shall disburse such proceeds and amount in the
case of Repairs or specific Tenant Changes, in the manner provided by Section
12.03 hereof.

        12.03 The aforesaid insurance proceeds and any amount deposited by
Tenant with the Trustee pursuant to Section 12.01, shall be paid by the Trustee
to Tenant in payment for the proportionate amount of costs and expenses
theretofore incurred ("Proportionate Amount") that the fund from time to time
held by the Trustee bears to the estimated full cost of the Repair in question
with respect to work and materials actually incorporated in the Demised Premises
from time to time, in installments, as the making of the Repair work progresses,
upon the requisition certificates of Tenant and a licensed architect retained by
Tenant to supervise the Repair. Each such requisition certificate shall set
forth (i) a description of all work performed since the last requisition
certificate was submitted to the Trustee, (ii) an estimate of the cost of the
remaining work to be performed to complete the Repair and (iii) a statement of
the architect that such requisition is not being submitted for work that has
been previously performed and paid for from the insurance proceeds or other
amount held by the Trustee and that the work in question has been properly
performed. If any mechanic's lien is filed against the Demised Premises, Tenant
shall not be entitled to receive any further installment until such lien is
satisfied, discharged of record or otherwise bonded against collection from
against the Demised Premises. The insurance proceeds and any other amount in the
hands of the Trustee shall not be reduced below the amount specified by Tenant's
architect in the certificates furnished with each draw request as the amount
required to complete the Repairs. If the amount of such insurance proceeds and
any other amount shall be in excess of the cost of any Repairs undertaken by
Tenant, such excess shall be paid to Tenant; provided, however, that if an Event
of Default on the part of the Tenant with respect to its monetary obligations
hereunder shall have occurred and then be continuing, such excess shall first be
applied to cure such Event of Default and the remainder shall be paid to Tenant.

        To the extent that any insurance proceeds or other amount held in escrow
by the Trustee shall be made available to Tenant to pay for its costs of making
such repairs, restoration, rebuilding and replacements; said payments shall be
made only under the condition that the Trustee be assured that at all times the
Demised Premises shall be free of liens or claims of liens by reason of such
work, or that any liens or claims of liens existing against the Demised Premises
shall be bonded against collection from against the Demised Premises and
provided further that the Proportionate Amount of the portion of the proceeds
and other amounts paid out at any time shall not exceed the Proportionate Amount
of the value of the actual work and materials incorporated in the repaired,
restored, rebuilt or replaced Demised Premises and the conditions described in
Article 6 are complied with. Tenant shall hold in trust all insurance proceeds
and any other amounts disbursed to Tenant by the Trustee, which proceeds and any
other amounts shall be used solely to pay for the costs of reconstruction to
effect the Repair of the Demised Premises.

        Notwithstanding the foregoing, if an Event of Default on the part of
Tenant has occurred and is then continuing under this Lease, the Trustee shall
make no further payment of insurance proceeds or any other amounts to Tenant
unless and until such Event of Default has been cured, it being understood that
in the event this Lease is terminated as a result of such Event of Default prior
to commencement or completion of the Repair in question, the amount of insurance
proceeds and any other amounts then held by the Trustee which are required to
complete the Repair in question shall be paid to Landlord; provided, however,
that in no event whatsoever will any insurance proceeds attributable to any of
Tenant's Property be paid to Landlord.


<PAGE>   20

        12.04 In the event of any damage to or destruction of the Demised
Premises, Tenant shall promptly notify Landlord and the Fee Mortgage and shall
make prompt proof of loss to the relevant insurance company(ies). Tenant is
hereby authorized, in the exercise of its sole and absolute discretion, to
settle or otherwise compromise and directly collect the proceeds of any and all
insurance claims on behalf of all interested parties, provided that all such
proceeds are applied to the reconstruction of the Demised Premises; provided,
however, that if such damage or destruction shall occur at any time during the
five (5) year period immediately preceding the Expiration Date of this Lease and
Tenant shall elect not to effect the Repair of the Demised Premises, as provided
in Section 12.01 hereof, then Landlord shall thereupon have the right to settle
and compromise such insurance claims and the provisions of the immediately
following paragraph shall not apply.

        At the request of Tenant, Landlord shall be required to join in any and
all actions, proceedings or settlements with respect to the collection of such
proceeds, in which event any such action, proceeding or settlement may be taken
or made by Tenant in the name of, but without expense to Landlord. Tenant shall
serve notice upon Landlord of Tenant's intention to take such action, initiate
such proceeding or make such settlement,and Landlord's failure to join in such
action, proceeding or settlement within ten (10) days from the date of
Landlord's deemed receipt of Tenant's notice in the manner provided by Section
29.01 hereof shall thereupon constitute immediate authorization and appointment
by Landlord of Tenant to act as Landlord's true and lawful representative and
attorney-in-fact coupled with an interest, with full power and authority in
Landlord's name, place and stead to make, execute, sign, acknowledge, and swear,
deliver, file and record at the appropriate governmental or other offices or
with any appropriate parties, such documents as may be reasonably required by
the subject matter of such notice. In connection therewith, Tenant shall
indemnify and hold harmless Landlord from and against any and all loss, claim,
damage or expense, including, without limitation, reasonable attorneys' fees and
disbursements, that Landlord may incur in connection with any such action,
proceeding or settlement and any instrument or document executed by Landlord, or
by Tenant on behalf of Landlord, pursuant to this Section 12.04.

        12.05 The provisions and requirements of Article 6 hereof shall apply
with respect to any repairing, restoring, rebuilding or replacing made pursuant
hereto; and same shall be made in accordance with the Plans and Specifications
(copies of which Tenant shall cause to be delivered to Landlord) to the extent
same is practicable.

        Notwithstanding anything contained herein to the contrary, Tenant's
obligation to effect the Repair (as defined in Section 12.01) of the Demised
Premises shall be reduced and abated to the extent, if any, that the Fee
Mortgagee under the existing Fee Mortgage is permitted to and actually requires
that any insurance proceeds be paid to and retained by such Fee Mortgagee
instead of being applied in payment of the cost of such Repair. Landlord will
use its reasonable efforts to induce the Fee Mortgagee to make such proceeds
available to Tenant for purposes of making Repairs in the manner provided
herein. It is expressly agreed, however, that any refinancing of the existing
Fee Mortgage and any other Fee Mortgage hereafter placed against the Demised
Premises shall in all events expressly provide for the payment of all insurance
proceeds to Tenant for than purpose of effecting Repairs of the Demised Premises
in accordance with such reasonable procedures (which may include a requirement
that such Fee Mortgagee hold and disburse the insurance proceeds in lieu of the
Trustee) as such Fee Mortgagee shall agree to in order to effectively carry out
the provisions of this Article 12, and such procedures shall supersede those
provided for in this Article 12.

        12.06 Landlord and Tenant shall each look first to any insurance in its
favor before making any claim against the other party for recovery for loss or
damage resulting from fire or other casualty, and to the extent that such
insurance is in force and collectible and to the extent permitted by law,
Landlord and Tenant each hereby releases and waives all right of recovery
against the other or any one claiming through or under each of them by way of
subrogation or otherwise. The foregoing release and waiver shall be in force
only if both releasor's insurance policies contain a clause providing that such
a release or waiver shall not invalidate the insurance and also, only if such
clause can be obtained without additional premiums. Each party hereto shall
notify the other if it is unable to obtain from its respective insurance carrier
such a clause or if such clause is only available at additional cost.


<PAGE>   21

        12.07 Tenant hereby agrees that, notwithstanding any damage or
destruction to the Demised Premises or any portion thereof as described herein,
Tenant shall not be relieved of its obligation to pay to Landlord the Rent due
hereunder for its use of the Demised Premises-(and/or its use of Additional
Space, as described below) unless and until this Lease is terminated (unless
such termination is due to the existence of an Event of Default on the part of
Tenant hereunder); provided, however, that the additional rent payable hereunder
with respect to the Additional Space (to the extent and for so long as the
existing term(s) of the L.P. and/or the Larama Leases shall remain in effect)
shall be reduced and/or abated to the extent provided by the provisions of
Article 9 of the L.P. Lease and/or Article 9 of the Larama Lease.

                                   ARTICLE 13
                                  CONDEMNATION

        13.01 If at any time during the term of this Lease, the whole or
substantially all of the Demised Premises shall be taken or condemned (a
"Taking") for any public or quasi-public purpose by any lawful power or
authority, by the exercise of the right of condemnation or eminent domain or by
agreement between Landlord and those authorized to exercise such right, this
Lease and the term hereof shall terminate and expire on the date of such Taking
and the Rent and other sums of money and charges herein reserved and provided to
be paid by Tenant shall be apportioned and paid by Tenant to the date of such
Taking. If this Lease shall be terminated in accordance with this Section 13.01,
compensation from the award (the "Award") made in such Taking shall be
distributed in the order of priority as indicated below:

                (i) First, to the Qualified Fee Mortgagee (as such capitalized
        term is hereafter defined), up to the amount of the then outstanding
        principal balance of the Fee Mortgage, but not more than the Qualified
        Fee Mortgage Amount (as such capitalized term is hereafter defined); and

                (ii) The balance of the Award shall be apportioned and
        distributed between Landlord and Tenant in such manner and amount as
        they may mutually agree upon or, if they fail to reach agreement with
        respect thereto, then such apportionment shall be resolved by appraisal
        of the respective interests of Landlord and Tenant (giving due
        consideration to the distribution referred to in clause (i) above) in
        accordance with the provisions of Section 25.04 hereof.

        For purposes of this Article 13, a Qualified Fee Mortgagee shall be
deemed to mean an "Institutional Lender" (as hereinafter defined) that is the
holder of a Fee Mortgage, affecting the Demised Premises (but only to the extent
that the outstanding principal balance of such Fee Mortgage does not exceed
eighty (80%) percent of the fair market value of the Demised Premises on a free
and clear basis immediately prior to the condemnation in question, as determined
by appraisal in accordance with the procedures set forth in Section 25.04
hereof, such amount being referred herein as the Qualified Fee Mortgage Amount)
and which mortgage does not require the payment of installments of debt service
thereunder on an annual basis in an amount that is greater than one-hundred ten
(110%) percent of the annual Rent that is payable hereunder at the time in
question.

        For purposes of this Section 13.01, an "Institutional Lender" shall be
deemed to mean the holder of a first mortgage that is a bank, savings bank,
savings and loan association, trust company, insurance company, real estate
investment trust, university, one of the foregoing acting as a trustee,
teacher's retirement or pension fund, pension or retirement fund covering
employees of a government or governmental authority or subdivision or agency or
public corporation, or other investing entity having total assets or endowment
of not less than Two Hundred Fifty Million ($250,000,000) Dollars and generally
referred to and acknowledged in the New York City real estate industry to be an
"institutional lender" or "institutional investor".

        13.02 If a Taking shall occur with respect to twenty-five (25%) percent
or more of the Demised Premises, or all reasonable means of ingress and egress
to and from the Demised Premises are permanently eliminated by reason of any
such Taking, then and in any of such events, Tenant shall have the right,
exercisable by written notice delivered to Landlord within sixty (60) days after
such Taking, to terminate this Lease and upon delivery of the foregoing


<PAGE>   22

notice to Landlord, this Lease and the term hereof shall cease and the Fixed
Rent and other charges payable by Tenant hereunder shall be apportioned and paid
to the date of the Taking. If this Lease is terminated in accordance with this
Section 13.02, Tenant shall be entitled to its share of the Award determined in
accordance with the procedures set forth in Section 13.01 hereof.

        13.03 If there shall be a Taking not resulting in the termination of
this Lease as aforesaid, the term hereof shall not be reduced or affected in any
way, and:

                (i) Tenant shall be entitled to the percentage of the Award to
        which it would be entitled under Section 13.01 hereof that is equivalent
        to the percentage of the Demised Premises so taken and to a Tenant's
        Improvements Award to the extent Tenant's Improvements are in fact
        taken.

                (ii) Tenant shall apply the portion of the Award that it
        receives pursuant to the preceding clause (i) to restore, to the extent
        reasonably possible, the remaining portions of the Demised Premises to
        its former condition.

                (iii) The Fixed Rent payable for the balance of the term of this
        Lease shall be equitably and proportionately reduced from the date of
        the Taking, based on the reduction, from time to time, in the square
        foot floor area of the Demised Premises occasioned thereby.

                (iv) Except to the extent that Tenant may be prevented from so
        doing pursuant to the terms of the order of the condemning authority,
        Tenant shall perform and observe all of the terms, covenants, conditions
        and obligations hereof upon the part of Tenant to be performed and
        observed, as though such Taking had not occurred.

        13.04 In the event of any Taking, Landlord shall immediately notify
Tenant and Tenant shall have the absolute right to participate in the
condemnation proceedings, including, without limitation, any and all
negotiations or litigation with the condemning authority and Landlord shall at
all times cooperate with Tenant in connection therewith.

        13.05 Nothing contained herein shall be construed to preclude Tenant
from prosecuting any additional claim directly against the condemning authority
in such condemnation proceedings for loss of business, depreciation or damage to
and/or cost of removal or the value of, stock and/or trade fixtures, furniture
and other personal property belonging to Tenant, but only provided that any
award made in respect of any such claim is not in diminu- tion of any portion of
the Award for the Main Parcel, the Elevator Shaft Parcel or the Building.

                                   ARTICLE 14
                          REMOVAL OF TENANT'S PROPERTY

        14.01 Except as hereinafter provided, all of Tenant's permanent
improvements or alterations to the Demised Premises (collectively, the "Tenant
Improvements") shall become the property of Landlord following the expiration of
the term of this Lease.

        14.02 Tenant shall have the right, at any time during the term of this
Lease, to remove "Tenant's Property", consisting of machinery, trade equipment,
business and trade fixtures and other trade equipment placed, installed,
supplied or made by it in or on the Demised Premises, at Tenant's cost and
expense (without any contribution or reimbursement therefor by Landlord), and
which may be removed, provided that Tenant shall be liable for the cost of
repairing any damage to the Demised Premises caused as a result of Tenant's
removal of Tenant's Property. As used herein and hereinafter, the term Tenant's
Property shall not include or be deemed to include any item now or hereafter
installed in or on the Demised Premises that is an integral part thereof,
including, without limitation, heating, ventilating, and air conditioning plants
and systems, electrical and plumbing fixtures and systems, the elevators
situated on the Elevator Shaft Parcel and other like equipment and fixtures, if
any.


<PAGE>   23

                                   ARTICLE 15

                      LANDLORD'S RIGHT TO PERFORM TENANT'S
                      COVENANTS AND CURE TENANT'S DEFAULTS;
                      TENANT'S RIGHT TO PERFORM LANDLORD'S
                     COVENANTS AND CURE LANDLORD'S DEFAULTS

        15.01 If Tenant shall at any time fail to satisfy any of the monetary
charges or obligations for which Tenant is responsible hereunder in the manner
and to the extent provided herein or shall otherwise fail to bond adequately the
collection against the Demised Premises of any Tax or other monetary charges or
expenses, then Landlord, without waiving or releasing Tenant from any of its
obligations hereunder, may at its option serve a notice to Tenant providing that
if Tenant does not pay any such sum on Tenant's part to be paid as provided
herein within ten (10) days after Tenant's deemed receipt of such notice (as
provided by Section 29.01 hereof), then Landlord shall have the right but not
the obligation to pay such amount on behalf of Tenant. In the event that
Landlord gives any such notice, Landlord shall thereupon become responsible for
properly paying such sum, and Tenant agrees to reimburse Landlord upon demand
(as additional rent) for the amount of any such payments made by Landlord on
Tenant's behalf and such amounts shall constitute items of additional rent
payable hereunder and shall be paid by Tenant to Landlord on written demand,
together with interest thereon at the Penalty Rate (as that term is defined in
Section 9.01 hereof) computed from the date such funds are advanced by Landlord
until reimbursed by Tenant. If Tenant does not reimburse Landlord for any such
sums so expended by Landlord on behalf of Tenant, together with interest
thereon, within ten (10) days after Tenant's deemed receipt (in accordance with
Section 29.01 hereof) of the aforesaid written demand for payment, then an Event
of Default (as defined in Article 19 hereof) on the part of Tenant hereunder
will be deemed to have occurred. If Tenant shall at any time fail to satisfy any
of the non-monetary obligations on its part to be performed hereunder and has
not begun the process of complying with or curing any such matter, or is not
otherwise diligently pursuing such compliance or cure to completion, and if such
failure to perform on the part of Tenant causes an emergency situation to exist,
then Landlord shall thereupon have the right to enter the Demised Premises
without notice for the express limited purpose of effecting the cure of such
non-monetary obligation. In the event that Landlord takes any such action,
Landlord shall thereupon become responsible for properly performing such act
and, in the case of any repairs to the Demised Premises, or any portion thereof,
Landlord shall be obligated to cause any work to be performed in good and
workmanlike manner, in compliance with all applicable permits and authorizations
and building and zoning laws, ordinances, rules and requirements of all federal,
state, and municipal government authorities, and Tenant agrees to reimburse
Landlord upon demand (as additional rent) for the amount of any such payments
made by Landlord on Tenant's behalf and such amounts shall constitute items of
additional rent payable hereunder and shall be paid by Tenant to Landlord on
written demand, together with interest thereon at the Penalty Rate (as that term
is defined in Section 9.01 hereof) computed from the date such funds are
advanced by Landlord until reimbursed by Tenant.

        15.02 If Landlord shall at any time fail to make any payment or perform
any act on its part to be made or performed hereunder beyond any applicable
grace period (including, without limitation, its obligation to pay all Taxes
with respect to the Adjacent Parcel), and Landlord has not cured such default or
has not commenced and is not diligently proceeding to cure same, then Tenant,
without waiving or releasing Landlord from any of its obligations hereunder, may
at its option and upon not less than ten (10) days prior written notice (and
without any notice in the case of an emergency), pay any sum or perform any act
on Landlord's part to be paid or performed as provided herein. Landlord agrees
to reimburse Tenant upon demand for all amounts expended by Tenant with respect
to the foregoing and all out-of-pocket expenses incurred or payments made in
connection with the foregoing, which amounts shall bear interest at the Penalty
Rate from the date of their disbursement or payment by Tenant until reimbursed
by Landlord. The amount of any payment made or expense incurred by Tenant in
connection with Landlord's failure to pay Taxes on the Adjacent Parcel shall be
set-off against any future rent or other payments due by Tenant under this
Lease.

                                   ARTICLE 16
                               DISCHARGE OF LIENS


<PAGE>   24

        16.01 Tenant will not create, permit to be created or otherwise allow
the continued existence of any lien, encumbrance or charge upon the Demised
Premises, or any part thereof, or the income therefrom, having any priority or
preference over this Lease or ranking on a parity with the estate, right and
interest of Landlord in the Demised Premises, or the Land, or any part thereof,
or the income therefrom. Tenant covenants and agrees to cause the prompt
discharge of record of any and all such matters and will not suffer any matter
or thing whereby the estate, right and interest of Landlord might be impaired
except as expressly provided in this Lease.

        16.02 If, as a result of action or inaction by Tenant, any mechanic's,
laborer's or materialmen's lien shall at any time be filed against any part of
the Demised Premises, Tenant shall cause the same to be discharged of record
within thirty (30) days after the notice of the filing thereof by payment,
deposit, bond, order of a court of competent jurisdiction or otherwise.

        16.03 All materialmen, contractors, artisans, mechanics, laborers and
any other persons who now or hereafter have contracted with Tenant for the
furnishing of any labor, services, materials, supplies or equipment with respect
to any portion of the Demised Premises at any time from the date hereof until
the end of the term of this Lease, are hereby charged with notice that they must
look exclusively to Tenant to obtain payment for the same.

                                   ARTICLE 17
                      LANDLORD'S ACCESS TO DEMISED PREMISES

        17.01 Landlord and its duly authorized representatives shall have the
right to enter the Demised Premises at reasonable times after business hours
(unless an emergency requires Landlord's access during business hours), upon
giving to Tenant reasonable prior written notice under the circumstances, for
the purpose of:

                (i) inspecting the conditions of same, and making such repairs,
        alterations, additions, or improvements thereto as may be necessary by
        reason of Tenant's failure to make any repairs or perform any work
        required of Tenant pursuant to the terms of this Lease. Nothing
        contained herein shall imply any duty of Landlord to make any such
        inspections, repairs, alterations, additions, or improvements unless
        expressly otherwise provided in this Lease;

                (ii) exhibiting the same (but only between the hours of 11:00
        a.m. and 3:00 p.m.) to persons who may wish to purchase or mortgage the
        same; and

                (iii) during the one (1) year period preceding the Expiration
        Date (as the same may be extended by properly exercised Renewal
        Option(s)), exhibiting the same to persons who may wish to lease the
        same and placing a notice of reasonable size on the Demised Premises
        offering the same or any part thereof for rent.

                                   ARTICLE 18
                       ASSIGNMENT, SUBLETTING AND CONTROL

        18.01 If this Lease be assigned, or if the Demised Premises, or any part
thereof, be sublet or occupied by anybody other than Tenant, Landlord may, upon
the occurrence and during the continuance of an Event of Default on the part of
Tenant hereunder, collect rent from the assignee, subtenants or occupants of
Tenant, and apply the net amount collected in reduction of the rent reserved
herein, but no such assignment, subletting, occupancy or collection shall be
deemed a waiver of the requirements and restrictions hereafter set forth
regarding the subletting of the Demised Premises or the assignment of this
Lease, or the acceptance of the assignee, subtenant or occupants of Tenant, or a
release of Tenant from the further performance by Tenant of its obligations
under the provisions of this Lease.

        18.02 With respect to any subletting or assignment of all or any portion
of Tenant's interest under this Lease and the leasehold estate created hereby,
the following matters, to the extent hereinafter set forth, shall be complied
with:


<PAGE>   25

                (i) Any assignee shall assume, by written, recordable
        instrument, the due performance of all Tenant's prospective obligations
        under this Lease; provided, however, that Tenant shall not thereby be
        released from liability hereunder. In connection with such assumption,
        Landlord shall be required to deliver to such assignee a landlord's
        estoppel certificate addressed to such party and otherwise in compliance
        with the requirements of Article 23 hereof. If Landlord fails to deliver
        such certificate within thirty (30) days after Tenant's (or such
        assignee's) request therefor, then the same shall be deemed given and to
        constitute a certification to the extent and in the manner so provided
        by Article 23 hereof.

                (ii) Such assignment and/or subletting shall be subject to all
        the provisions, terms covenants and conditions of this Lease.

                (iii) Each sublease under the provisions of this Article 18
        shall provide that (a) such sublease is subject and subordinate to all
        of the terms, covenants and conditions of this Lease and to all of the
        rights of Landlord hereunder and shall not extend beyond the Expiration
        Date of the term of this Lease and (b) in the event this Lease shall
        terminate before the expiration of such sublease, the subtenant
        thereunder will (but only if and to the extent that Landlord agrees not
        to disturb the tenancy of such subtenant so long as such subtenant is
        not in default beyond any applicable grace period with respect to the
        performance of its obligations under the provisions of such sublease),
        at Landlord's option, attorn to Landlord and waive any rights the
        subtenant may have to terminate the sublease or to surrender possession
        thereunder, as a result of the termination of this Lease.

        18.03 Tenant may mortgage its leasehold interest under this Lease,
provided that same is subject and subordinate to the interest of Landlord and
the present or any future Fee Mortgagee in the Demised Premises and that same
does not violate the provisions of any loan documents supplied to Tenant
evidencing or securing such Fee Mortgage(s) of Landlord's interest in and to the
Demised Premises. Tenant agrees to execute, in recordable form, such instruments
as may be reasonably required from time to time in order to confirm such
subordination. Landlord expressly undertakes to furnish to Tenant, upon request,
copies of any Fee Mortgage affecting the Demised Premises as well as any and all
supportive documentation pertaining thereto.

        18.04 The interest of Tenant hereunder may be assigned or sublet in its
entirety, or all or substantially all of the outstanding capital stock of Tenant
sold, without Landlord's prior consent, to an assignee, subtenant or purchaser,
if such person or entity will have a net worth immediately after such sale in an
amount that is equal to or greater than the lesser of the net worth of Tenant as
of (a) the date immediately preceding such transaction or (b) the date hereof.
Notwithstanding the foregoing, Tenant shall expressly have the right to effect
an assignment of its entire interest under this Lease to the then current
management of the business conducted at the Demised Premises without Landlord's
consent or complying with any requirement imposed by this Section 18.04.

        Tenant shall expressly have the right, without obtaining Landlord's
consent or complying with any requirement imposed by this Section 18.04, to
cause the management of the business conducted at the Demised Premises to be
carried out under a management agreement arrangement, whereby Tenant may enter
into a management agreement with an Affiliate, (as hereinafter defined) of
itself for the management of the Demised Premises. Such Management Agreement may
provide, among other matters, for the payment of such management fees as Tenant
shall deem appropriate for the performance of management services. In connection
with the foregoing, Tenant shall expressly have the right, without obtaining
Landlord's consent or complying with any requirement imposed by this Section
18.04, to assign this Lease to a corporation substantially all of the capital
stock of which is owned by the members of the health club facility conducted at
the Demised Premises (and/or Tenant or an Affiliate of Tenant).

        18.05 With Landlord's prior written consent, which consent may not be
unreasonably withheld, Tenant may assign all of its interest in the Lease, or
sublet all or any portion of the Demised Premises to any person or entity that
does not satisfy the requirements of Section 18.04 hereof. In addition, Landlord
hereby agrees to indemnify and hold harmless Tenant from and against any and all
liability, loss, cost, injury, damage or other expense whatsoever that


<PAGE>   26

        Tenant may incur as a result of Landlord's failure to give its consent
hereunder, in the event that it is finally determined by a court of competent
jurisdiction that Landlord's failure to give any such consent was unreasonable.

        18.06 Notwithstanding the provisions of the preceding Section 18.05,
Tenant may, without Landlord's prior written consent:

                (a) assign all or sublet any portion of its interest in and to
        this Lease and the Demised Premises to an Affiliate of itself;

                (b) sublet any portion of the Demised Premises to any party for
        the purpose of continuing to use the sublet portion for the same purpose
        as such portion of the Demised Premises so sublet was used prior to such
        subletting (e.g., as a restaurant/night club with respect to the space
        currently occupied by Larama, as a garage with respect to the space
        currently occupied by L.P., or as a restaurant with respect to the third
        floor restaurant space);

                (c) sublet any portion of the Demised Premises to any person or
        entity for any use or operation that is related to the primary current
        use of the Demised Premises (e.g., as a sports clothing and/or sports
        equipment boutique, massage or physical therapy service, or aerobic
        dance center);

                (d) the aggregate of space within the Demised Premises to be
        further sublet from and after the date hereof pursuant to subparagraphs
        (b) and (c) above shall be limited to not more than thirty (30%) percent
        of the Demised Premises; provided, however, that the Additional Space
        presently covered by each of the Existing Leases shall be excluded for
        all purposes from any and all calculations made pursuant to this Section
        18.06(d) in connection with the determination of such limitation.

        For purposes of this Article 18, the term "Affiliate" shall mean, with
respect to a specific entity, any natural person, or any firm, corporation,
partnership, association, trust or other entity which, directly or indirectly,
controls, or is under common control with such entity. For purposes hereof, the
term "control" shall mean the possession, directly or indirectly (and, in the
case of a corporation, of at least fifty-one (51%) percent of all classes of
voting stock of the corporation in question) of the power to direct or cause the
direction of the management and policies of any such entity, whether through the
ownership of voting securities, by contract, or otherwise.

                                   ARTICLE 19
                                     DEFAULT

        19.01 The occurrence and continuance of any one or more of the following
events shall be deemed to constitute an "Event of Default" hereunder:

                (i) Tenant shall default with respect to the payment of any Rent
        payable under this Lease or any other sum when and as the same shall
        become due and payable, and such default shall continue for a period of
        ten (10) days after Tenant's deemed receipt of written notice from
        Landlord specifying such default, which notice shall be delivered in
        accordance with Section 29.01 hereof;

                (ii) Tenant shall default with respect to the performance or
        compliance with any of the agreements, terms, covenants or conditions on
        the part of Tenant to be performed under the provisions of this Lease
        (other than those referred to in the foregoing subsection 19.01(i)
        hereof) for a period of thirty (30) days after Tenant's deemed receipt
        of notice from Landlord specifying the items in default, which notice
        shall be delivered in accordance with Section 29.01 hereof, or in the
        case of any such default or condition which is susceptible of being
        cured but which cannot with due diligence be cured within said thirty
        (30) day period, if Tenant fails to proceed within said thirty (30) day
        period to commence to cure the same and thereafter to prosecute the
        curing of such default with due diligence (provided, however, that the
        time period within which Tenant may cure a default susceptible of being
        cured but which cannot with due diligence be cured within said thirty
        (30) day period shall be extended for such period as may be necessary to
        complete the same with all due diligence);


<PAGE>   27

                (iii) if Tenant shall commence or institute any case, proceeding
        or other action (x) seeking relief on its behalf as debtor, or to
        adjudicate it a bankrupt or insolvent, or seeking reorganization,
        arrangement, adjustment, winding-up, liquidation, dissolution,
        composition or other relief with respect to it or its debts under any
        existing or future law of any jurisdiction, domestic or foreign,
        relating to bankruptcy, insolvency, reorganization or relief of debtors,
        or (y) seeking appointment of a receiver, trustee, custodian or other
        similar official for it or for all or any substantial part of its
        property, or if Tenant shall make a general assignment for the benefit
        of creditors;

                (iv) if any case, proceeding or other action shall be commenced
        or instituted against Tenant (x) seeking to have an order for relief
        entered against it as debtor or to adjudicate it a bankrupt or
        insolvent, or seeking reorganization, arrangement, adjustment,
        winding-up, liquidation, dissolution, composition or other relief with
        respect to it or its debts under any existing or future law of any
        jurisdiction, domestic or foreign, relating to bankruptcy, insolvency,
        reorganization or relief of debtors, or (y) seeking appointment of a
        receiver, trustee, custodian or other similar official for it or for all
        or any substantial part of its property, which either (1) results in any
        such entry of an order for relief, adjudication of bankruptcy or
        insolvency or such an appointment or the issuance or entry of any other
        order having a similar effect or (2) remains undismissed for a period of
        one hundred twenty (120) days, or if any case, proceeding or other
        action shall be commenced or instituted against Tenant seeking issuance
        of a warrant of attachment, execution, distraint or similar process
        against all or any substantial part of its property which results in the
        entry of an order for any such relief which shall not have been vacated,
        discharged, or stayed or bonded pending appeal within one hundred twenty
        (120) days from the entry thereof;

                (v) if Tenant shall take any action in furtherance of, or
        indicating its consent to, approval of, or acquiescence in, any of the
        acts set forth in subsections (iii) or (iv) above;

                (vi) if a trustee, receiver or other custodian is appointed for
        any substantial part of the assets of Tenant which appointment is not
        vacated or effectively stayed within thirty (30) business days; or

                (vii) if the Demised Premises shall be abandoned by Tenant or
        shall become vacant during the term of this Lease.

        Upon the occurrence and during the continuance of an Event of Default on
the part of Tenant, Landlord shall have the right to deliver to Tenant, in
accordance with Section 29.01 hereof, a final notice specifying the date and
time on which the Lease will be effectively terminated, which date shall not be
less than ten (10) days from the date on which Tenant shall be deemed to have
received such notice pursuant to Section 29.01 hereof, and on the date specified
in such notice this Lease shall expire with the same force and effect as though
the date so specified were the date herein originally fixed as the Expiration
Date, and all rights of Tenant under this Lease shall expire but Tenant shall
remain liable as hereafter provided.

        19.02 Upon any expiration or termination of this Lease pursuant to the
provisions of Section 19.01 hereof, Tenant shall quit and peacefully surrender
the Demised Premises to Landlord and Landlord, upon, or at any time after any
such expiration or termination, may, without further notice, enter upon and
re-enter the Demised Premises and possess and repossess itself thereof, by
force, summary proceedings, ejectment or otherwise, and may dispossess Tenant
and remove Tenant and all other persons and property from the Demised Premises
and may have, hold and enjoy the Demised Premises and the right to receive all
rental income of and from the same.

        Promptly after any such expiration or termination, Landlord shall be
required to use reasonable efforts in order to relet the Demised Premises, or
any part thereof, in the name of Landlord or otherwise, for such term or terms
(which may be greater or less than the period which would otherwise have
constituted the balance of the term of this Lease) and on such conditions
(which, may include concessions or free rent) as Landlord, in the exercise of
its commercially reasonable business judgment, may determine and may collect and
receive the rents therefor, which


<PAGE>   28

sums shall be applied in the discharge of any surviving monetary obligations of
Tenant to Landlord hereunder. The provisions of this paragraph shall survive any
such expiration or termination of this Lease.

        No such expiration or termination of this Lease shall relieve Tenant of
Tenant's liability and obligations under this Lease, and such liability and
obligations shall survive any such expiration or termination. In the event of
any such expiration or termination, Tenant shall pay to Landlord the Rent and
all other charges required to be paid by Tenant up to the time of such
expiration or termination of this Lease. Thereafter, and until the end of what
would have been the term of this Lease in the absence of such expiration or
termination (but only if and to the extent that Landlord continues to comply
with and perform its obligations under the provisions of the immediately
preceding paragraph), Tenant shall be liable to Landlord for and shall pay to
Landlord as and for liquidated damages for Tenant's default, the equivalent of
the amount of the Rent and other charges which would be payable under this Lease
by Tenant if this Lease were still in effect, less the net proceeds of any
re-letting effected pursuant to the provisions of this subsection 19.02, after
deducting all of Landlord's reasonable expenses in connection with such
re-letting, including, without limitation, all reasonable repossession costs,
brokerage and management commissions, operating expenses, legal expenses,
reasonable attorneys' fees, alteration costs, and expenses of preparation for
such re-letting. In no event shall Tenant be entitled to receive any proceeds of
reletting if such proceeds exceed the amount owed by Tenant to Landlord
hereunder.

        Tenant shall pay such liquidated damages (herein called "deficiency") to
Landlord monthly on the days on which the Fixed Rent and additional rent would
have been payable under this Lease if this Lease were still in effect and
Landlord shall be entitled to recover from Tenant each monthly deficiency as the
same shall arise.

        19.03 No failure by Landlord or Tenant to insist upon the strict
performance by the other respective party of any covenant, agreement, term or
condition of this Lease or to exercise any right or remedy consequent upon a
breach thereof, and no acceptance of full or partial rent by Landlord during the
continuance of any such breach on the part of Tenant, shall constitute a waiver
of any such breach or of such covenant, agreement, term or condition. No
covenant, agreement, term or condition of this Lease to be performed or complied
with by either party and no breach thereof, shall be waived, altered or modified
except by a written instrument executed by the other party. No waiver of any
breach shall affect or alter this Lease but each and every covenant, agreement,
term and condition of this Lease shall contin- ue in full force and effect with
respect to any other then existing or subsequent breach thereof.

        19.04 Tenant hereby expressly waives, to the extent permitted by law,
the service of any notice of intention to re-enter or notice to quit provided
for in any statute (other than notices expressly provided for herein), or of the
institution of legal proceedings to that end, and Tenant, for and on behalf of
itself and all persons claiming through or under Tenant, also waives any and all
right of redemption or re-entry or repossession or to restore the operation of
this Lease in case Tenant shall be dispossessed by a judgment or by warranty of
any court or judge or in the case of re-entry or repossession by Landlord or in
the case of any expiration or termination of this Lease.

        19.05 It is expressly agreed that the failure of Tenant to take any
action in order to effect the cure of any Existing Conditions shall not be
considered a default by Tenant with respect to the performance of its
obligations hereunder and shall in no event whatsoever constitute the basis for
the occurrence of an Event of Default on the part of Tenant hereunder.

                                   ARTICLE 20
                                 QUIET ENJOYMENT

        Landlord hereby represents and warrants to Tenant that it has full
right, power and authority to enter into this Lease for the term herein granted
and Landlord covenants and agrees with Tenant that upon Tenant's paying the Rent
and other charges due hereunder, and observing and performing all the terms,
covenants and conditions on Tenant's part to be observed and performed, Tenant
may peaceably and quietly enjoy the Demised Premises, free from any
interference, molestation or acts of Landlord or any corporate or other entity
that controls, is controlled by


<PAGE>   29

or is under common control with Landlord or of anyone claiming by, through or
under Landlord or any party affiliated with Landlord, subject, nevertheless, to
the terms and conditions of this Lease.

                                   ARTICLE 21
                                  SUBORDINATION

        21.01 This Lease is subject and subordinate only to a first priority fee
mortgage (the "Fee Mortgage") affecting Landlord's interest in the Demised
Premises being currently held by Citibank, N.A. (the "Fee Mortgagee"). Landlord
will use reasonable efforts to deliver to Tenant, simultaneously with the
execution and delivery hereof, an amended non-disturbance agreement in the form
annexed hereto as Exhibit H, duly executed and acknowledged by the Fee
Mortgagee, with respect to the estate of Tenant under this Lease.
Notwithstanding the foregoing, Landlord hereby agrees not to take any actions
that might cause the existing non-disturbance agreement heretofore executed by
the Fee Mortgagee not to continue to remain in full force and effect in the
event that the aforesaid amended non-disturbance agreement is not obtained. This
Lease will also be subject and subordinate to all renewals, modifications,
consolidations, replacements and extensions of the Fee Mortgage; provided,
however, that any successor to the Fee Mortgagee or any other holder of a
replacement shall be required to agree, in addition to those matters referred to
in Section 12.05 hereof, in a separate instrument delivered to Tenant, either to
the provisions substantially as set forth in Exhibit H annexed hereto or as
follows:

                (i) that in the event of foreclosure, the holder of such
        mortgage will cause the sale of the Demised Premises in any foreclosure
        action to be made subject to this Lease, provided that no Event of
        Default on the part of Tenant has occurred and is then continuing;

                (ii) that such mortgagee or anyone acquiring the Demised
        Premises through or under such mortgagee will not disturb the possession
        of Tenant during the term of this Lease or any extension hereof other
        than upon the occurrence and during the continuance of an Event of
        Default on the part of Tenant here under; provided, however, that if an
        Event of Default on the part of Tenant has occurred and shall be
        continuing at the time of such foreclosure, then upon the cure of such
        Event of Default prior to the entry of an order of foreclosure under
        such mortgage, the non-disturbance covenant referred to herein shall be
        deemed to be reinstated in all respects and the terms and provisions of
        this Lease shall continue to remain in full force and effect unless and
        to the extent otherwise provided herein;

                (iii) that Tenant will attorn to such mortgagee (and to any
        purchaser of such mortgagee's interest in and to the Demised Premises at
        a foreclosure sale); provided, however, that such mortgagee or purchaser
        shall not be bound by (a) any amendment to this Lease not consented to
        by such mortgagee, (b) any prepayment of Rent hereunder for a period in
        excess of thirty (30) days or (c) any claims or offsets against a prior
        holder of the Landlord's interest hereunder; and

                (iv) such mortgage shall provide (or the holders thereof, shall
        separately agree) that so long as an Event of Default on the part of
        Tenant has not occurred and is continuing, the proceeds of any insur-
        ance coverage with respect to the Demised Premises payable by reason of
        fire or other insured casualty shall first be applied in payment of the
        cost of restoring the Demised Premises after such injury or taking (in
        accordance with such procedures as may be reasonably approved by such
        mortgagee), before any part of such proceeds shall be applied on account
        of any part of such mortgage indebtedness. The lien of any mortgage
        shall not cover any trade fixtures or other personal property paid for
        and installed in the Demised Premises by Tenant (or any persons claiming
        under Tenant) without any contribution or reimbursement therefor by
        Landlord.

        21.02 The aforesaid provisions shall be self-operative and no further
instrument of subordination shall be required. In the event Landlord desires
confirmation of the provisions of this Article, Tenant shall execute, promptly
and without charge therefor, any instrument, in recordable form, that Landlord
may reasonably request in order to confirm the foregoing matters. However, if
Tenant shall fail to execute any such instrument, in recordable form, within
twenty (20) days after Tenant's deemed receipt (in the manner provided by Sec-
tion 29.01 hereof) of


<PAGE>   30

Landlord's notice of request therefor, such inaction shall thereupon constitute
the immediate authorization and appointment by Tenant of Landlord to act as
Tenant's true and lawful attorney-in-fact, coupled with an interest, with full
power and authority in Tenant's name, place and stead to make, execute, sign,
acknowledge, and swear, deliver, file and record at the appropriate governmental
or other offices or with any appropriate parties, an instrument, in recordable
form, setting forth the foregoing matters. In connection therewith, Landlord
shall indemnify and hold harmless Tenant from and against any and all loss,
claim, damage, cost or expense, including, without limitation, reasonable
attorneys' fees and disbursements, that Tenant may incur as a result of any
provision specifically set forth in such subordination (and with respect to
which Tenant would not otherwise incur liability under this Lease).

        21.03 Notwithstanding the foregoing, should the Fee Mortgagee or any
substitute or successor holder of a fee mortgage covering Landlord's interest in
the Demised Premises require that this Lease be prior rather than subordinate to
the Fee Mortgage or any other applicable mortgage, Tenant shall promptly upon
request therefor by Landlord or such mortgagee, and without charge therefor,
execute a document effecting and/or acknowledging such priority.

                                   ARTICLE 22
                                    BROKERAGE

        Landlord and Tenant each represents and warrants to the other that it
has dealt with no brokers with respect to entering into this Lease and that
neither party nor its respective representatives has done any acts, had any
negotiations or conversations, or made any agreements or promises which will in
any way create or give rise to any obligation or liability for the payment of
any fee, charge, commission or other compensation to any broker or finder with
respect to this Lease. Landlord and Tenant each agrees to forever indemnify,
defend and save harmless the other of, from and against any and all claims or
suits for compensation, commission and/or otherwise which may be asserted or
made by any broker, person or entity for bringing about this Lease as a result
of any dealings by each respective party or its representatives with such other
broker, person or entity, including, without limitation, all costs, losses,
liabilities, damages and expenses (including, without limitation, reasonable
attorneys' fees and disbursements) related thereto.

                                   ARTICLE 23
               LEASE STATUS; LANDLORD'S AND TENANT'S CERTIFICATES

        Landlord and Tenant shall, each without charge at any time and from time
to time during the term of this Lease, within fifteen (15) days after receipt of
a request from the other party, certify by written instrument, duly executed,
acknowledged and delivered to the other party hereto or to any other party
specified by Landlord or Tenant, as the case may be:

                (i) That this Lease is unmodified, that the same is in full
        force and effect if such then be the case (or, if there has been
        modification, that the same is in full force and effect, if such then be
        the case, as modified and stating the modifications) and certifying that
        this Lease is a true and exact copy of the Lease between the parties
        hereto;

                (ii) To the best of its knowledge, whether or not there are then
        existing any breaches or defaults by the other party under any of the
        terms of this Lease and specifying such breach or default or any setoffs
        or defenses against the enforcement of any of the agreements, terms,
        covenants or conditions of this Lease upon the part of the Landlord or
        Tenant, as the case may be, to be performed or complied with (and, if
        so, specifying the same and the steps being taken to remedy the same);
        and

                (iii) The dates, if any to which the rental(s) and other charges
        under this Lease have been paid in advance.

        If Landlord or Tenant shall at any time fail to deliver to the other any
such certification within the aforesaid time period, such failure shall be
deemed to constitute an affirmation that this Lease is unmodified, in full force
and effect


<PAGE>   31

without default on the part of Landlord or Tenant and that each of the matters
referred to in the aforesaid items (i), (ii), and (iii) shall in all respects be
true and correct without restriction or exception.

                                   ARTICLE 24
                                    HOLDOVER

        After the expiration of the term of this Lease if not extended, or
extended term, if extended, if Tenant shall continue in possession thereafter
and Landlord shall accept the payment of Rent hereunder, such possession shall
be on a month-to-month basis upon the same terms of this Lease until terminated
at the end of a month by either party upon thirty (30) days advance written
notice to the other party.

                                   ARTICLE 25
                                 RENEWAL OPTIONS

        25.01 Tenant shall have the option (the "First Renewal Option") to
extend the term of this Lease for an additional period ("First Renewal Term") of
ten (10) years commencing on the day immediately succeeding the Expiration Date,
and terminating on the tenth anniversary of the Expiration Date. The First
Renewal option must be exercised by written notice ("First Renewal Notice") sent
by Tenant to Landlord by certified or registered mail, return receipt requested,
not later than eighteen (18) months prior to the Expiration Date. Any
termination, cancellation or surrender of Tenant's interest in this Lease during
the original term hereof shall terminate Tenant's right to exercise the First
Renewal Option. Tenant's right to exercise the First Renewal Option shall not
apply upon the occurrence and/or during the continuance of an Event of Default
on the part of Tenant hereunder. Upon delivery of the First Renewal Notice by
Tenant in accordance with the terms hereof, this Lease shall thereupon be deemed
renewed for the First Renewal Term with the same force and effect as if the
First Renewal Term had originally been included in the term of this Lease, and
this Lease, as extended, shall be upon the same terms, covenants and conditions
as are contained herein, except that (i) the amount of Fixed Rent payable during
the First Renewal Term (with respect to the entire Demised Premises, inclusive
of the Additional Space) shall be equal to the higher of (a) the amount
determined by mutual agreement of the parties hereto at least four (4) months
prior to the commencement of the First Renewal Term or by appraisal as
hereinafter provided and (b) the amount of Fixed Rent (inclusive of rent payable
for all Additional Space) payable during the last year of the original term of
this Lease (the "Prior Fixed Rent"), and shall be payable as provided below and
(ii) the number of renewal terms shall be reduced from two (2) to one (1), which
remaining renewal term is described and defined below as the "Second Renewal
Term". In addition, any default or Event of Default that has occurred and that
shall be continuing as of the expiration of the original term of this Lease
shall continue to constitute a default or Event of Default upon the commencement
of the First Renewal Term.

        If the parties hereto fail to agree upon the amount of Fixed Rent
payable during the First Renewal Term (with respect to the entire Demised
Premises, inclusive of the Additional Space) at least four (4) months prior to
the expiration of the original term of this Lease, the Fixed Rent shall be the
amount determined by appraisal in accordance with the provisions of Section
25.04 hereof to be the fair market rental value of the Demised Premises
(inclusive of the Additional Space), such fair market rental value to be
determined on the basis of (a) the use being made of the Demised Premises at the
date hereof or (b) the use being made of the Demised Premises immediately prior
to the expiration of the original term of this Lease, whichever yields the
higher value, and considering the terms and conditions of this Lease; provided,
however, that in no event shall the Fixed Rent during the First Renewal Term be
less than the Prior Fixed Rent.

        The amount of Rent payable during the First Renewal Term shall
thereafter be increased after the expiration of five (5) lease years from and
after the date of the commencement of the First Renewal Term, by the CPI
Adjustment; provided, however, that for purposes of making such calculation the
Base Year shall be deemed to be the last lease year of the original term and
such adjustment shall be made with reference to the then expiring lease year
(which new Rent shall be payable on an annual basis for the remaining five (5)
lease year period until


<PAGE>   32

expiration of the First Renewal Term). In no event shall the Fixed Rent be
reduced pursuant to the provisions of this paragraph.

        Upon Tenant's exercise of its option to extend the term of this Lease
for the First Renewal Term, Landlord and Tenant, upon demand by either party,
shall execute and deliver an instrument in recordable form, setting forth the
new expiration date of the term of this Lease.

        25.02 If the term of this Lease shall have been duly extended for the
First Renewal Term, Tenant shall have the option (the "Second Renewal Option")
to extend the term of this Lease for an additional period ("Second Renewal Term"
and, together with the First Renewal Term, being hereinafter sometimes
collectively referred to as the "Renewal Terms") of ten (10) years commencing on
the day immediately succeeding the Expiration Date of the First Renewal Term,
and terminating on the tenth anniversary of the Expiration Date of the First
Renewal Term. The Second Renewal Option must be exercised by written notice
("Second Renewal Notice") delivered by Tenant to Landlord by certified or
registered mail, return receipt requested, not later than eighteen (18) months
prior to the Expiration Date of the First Renewal Term. Any termination,
cancellation or surrender of Tenant's interest in this Lease during the original
term (or First Renewal Term) hereof shall terminate Tenant's right to exercise
the Second Renewal Option. Tenant's right to exercise the Second Renewal Option
shall not apply upon the occurrence and/or during the continuance of an Event of
Default on the part of Tenant hereunder.

        Upon delivery of the Second Renewal Notice by Tenant in accordance with
the terms hereof, this Lease shall thereupon be deemed renewed for the Second
Renewal Term with the same force and effect as if the Second Renewal Term had
originally been included in the term of this Lease, and this Lease, as extended,
shall be upon the same terms, covenants and conditions as are contained herein,
except that (i) the amount of Fixed Rent payable during the Second Renewal Term
(with respect to the entire Demised Premises, inclusive of the Additional Space)
shall be equal to the higher of (a) the amount determined by mutual agreement of
the parties hereto at least four (4) months prior to the commencement of the
Second Renewal Term or by appraisal as hereinafter provided and (b) the amount
of Fixed Rent payable during the last year of the First Renewal Term, and shall
be payable as provided below and (ii) there shall be no additional renewal
terms. In addition, any default or Event of Default that has occurred and that
shall be continuing as of the expiration of the First Renewal Term shall
continue to constitute a default or Event of Default upon the commencement of
the Second Renewal Term.

        If the parties hereto fail to agree upon the amount of Fixed Rent
payable during the Second Renewal Term (with respect to the entire Demised
Premises, inclusive of the Additional Space) at least four (4) months prior to
the expiration of the First Renewal Term, the Fixed Rent shall be the amount
determined by appraisal in accordance with Section 25.04 of this Lease to be the
fair market rental value of the Demised Premises (inclusive of the Additional
Space), such fair market rental value to be determined on the basis of (a) the
use being made of the Demised Premises at the date hereof or (b) the use being
made of the Demised Premises immediately prior to the expiration of the First
Renewal Term, whichever yields the higher value, and based upon the terms and
conditions of this Lease; provided, however, that in no event shall the Fixed
Rent during the Second Renewal Term be less than the Fixed Rent payable during
the last year of the First Renewal Term.

        The amount of Fixed Rent payable during the Second Renewal Term shall
thereafter be increased after the expiration of five (5) lease years from and
after the date of commencement of the Second Renewal Term, by the CPI
Adjustment; provided, however, that for purposes of making such calculation the
Base Year shall be deemed to be the final lease year of the First Renewal Term
and such adjustment shall be made with reference to the then expiring lease year
(which new Rent shall be payable on an annual basis for the remaining five (5)
lease year period until expiration of the Second Renewal Term). In no event
shall the Fixed Rent payable hereunder be reduced pursuant to the provisions of
this paragraph.

        Upon Tenant's exercise of its option to extend the term of this Lease
for the Second Renewal Term, Landlord and Tenant, upon demand by either party,
shall execute and deliver to each other an instrument in recordable form,
setting forth the new expiration date of the term of this Lease.


<PAGE>   33

        25.03 If the Fixed Rent applicable to the first lease year of either or
both of the Renewal Terms shall not have been determined at or prior to the
respective commencement dates thereof, then until such determination is made
Tenant shall continue to pay the Fixed Rent (inclusive of the rent for the
Additional Space) payable by Tenant immediately prior to commencement of such
Renewal Term. Upon a determination by the appraisers of the Fixed Rent
applicable to the Renewal Term in question, Tenant shall forthwith pay to
Landlord any deficit represented by the difference between the monthly
installments of Fixed Rent actually paid for such Renewal Term and the monthly
installments of Fixed Rent as so determined for the same period by the
appraisers with respect to such Renewal Term (or, if higher, the Fixed Rent,
inclusive of Rent payable for the Additional Space, during the last year of the
preceding term).

        25.04 Either Landlord or Tenant may submit any question required by the
provisions hereof to be presented to binding appraisal by written notice to that
effect to the other party and shall in such notice appoint a disinterested
person of at least ten (10) years experience as a real estate appraiser, who
shall be a member of a recognized society of appraisers and shall have had
experience in appraising major commercial properties located in the City of New
York, as appraiser on its behalf. Within thirty (30) days thereafter, the other
party shall by written notice to the first party appoint a second disinterested
person possessing like qualifications as appraiser on its behalf. The two (2)
appraisers thus appointed shall then appoint a third disinterested appraiser
possessing the aforesaid qualifications. Each of the three (3) appraisers thus
appointed shall, within thirty (30) days after the appointment of the third
appraiser, submit to Landlord and Tenant a written appraisal setting forth such
appraiser's determination with respect to the question presented, provided that:

                (i) if the second appraiser shall not have been appointed as
        aforesaid, the first appraiser shall alone proceed to determine such
        matter, and such sole appraiser shall then submit to Landlord and Tenant
        a written appraisal setting forth such appraiser's determination with
        respect to the question presented within thirty (30) days after the
        thirty (30) day period for the appointment of the second appraiser shall
        have lapsed; and

                (ii) if the two (2) appraisers appointed by the parties shall be
        unable to agree, within fifteen (15) days after the appointment of the
        second appraiser, on the appointment of a third appraiser, they or
        either of them shall give written notice of such failure to agree to
        Landlord and Tenant, and, if Landlord and Tenant fail to agree upon the
        selection of such third appraiser within fifteen (15) days after the
        appraisers appointed by Landlord and Tenant give such notice, then
        either of Landlord and Tenant, upon written notice to the other of them,
        may request such appointment by the American Arbitration Association in
        New York, New York (or any successor thereto), or on its failure,
        refusal or inability to act, may apply for such appointment to the then
        President of the Association of the Bar of the City of New York.

The final determination of the question presented shall be equal to the
numerical average of the two (2) appraised determinations which are the closest;
provided, however, that if the average of the three (3) appraised determinations
shall result in an amount which is the same as the appraised determination that
is the median of the three (3), the final determination of the question
presented shall in such case be equal to such median appraised determination;
and provided further, however, that if the second party shall not have chosen an
appraiser, the final determination of the question presented shall be equal to
the determination of the sole appraiser. The determination made as above
provided shall be conclusive upon the parties and judgment upon the same may be
entered in any court having jurisdiction thereof. Each party shall pay the fees
and expenses of the appraiser appointed by such party and one-half (1/2) of the
fees and expenses of the third appraiser and the other fees and expenses of the
appraisal properly incurred hereunder. Tenant further agrees to provide all
information, documents or data reasonably requested by any appraiser appointed
hereunder.

        25.05 Notwithstanding the foregoing, at any time during the term of this
Lease but, if Tenant shall have exercised the First Renewal Option, not less
than twenty-four (24) months prior to the expiration of the First Renewal Term,
Landlord shall have the right by giving notice (the "Cancellation Notice") to
Tenant to cancel this Lease (such cancellation in no event to be effective prior
to expiration of the First Renewal Term) for the express


<PAGE>   34

limited purpose of tearing down, razing, substantially rehabilitating or
demolishing the Building and rebuilding on the site of the Building, or
integrating same with a new structure to be built on the 328 Site following the
demolition or substantial rehabilitation of the structure presently situated
thereon. The preceding provisions of this Section 25.05 shall, in all events, be
subject to Tenant's right to continue to occupy the Demised Premises throughout
the original term of this Lease and throughout the First Renewal Term in the
event that Tenant duly exercises the First Renewal Option.

        This Lease and the term hereof shall cancel and terminate on the date
set forth in the Cancellation Notice as if such date was the Expiration Date of
this Lease; provided, however, that Tenant, if it shall have exercised the First
Renewal Option, may continue to remain in possession of the Demised Premises
until the later of (a) the expiration of the First Renewal Term or (b) the date
set forth for the termination of this Lease in the Cancellation Notice.

        25.06 In the event that Landlord determines, subsequent to the serving
upon Tenant of the Cancellation Notice that Landlord no longer intends to raze,
tear down, demolish or substantially rehabilitate the Building in order to
rebuild on the site of the Building or integrate same with a new structure,
Landlord may withdraw such Cancellation Notice by notice delivered to Tenant in
accordance with the provisions of Section 29.01 hereof; provided, however, that
if Tenant shall have exercised the First Renewal Option and the Cancellation
Notice is withdrawn by Landlord during the last five (5) years of the First
Renewal Term, Tenant shall then have the right, at its option, to either
exercise the Second Renewal Option as provided in Section 25.02 (or, if fewer
than 18 months shall remain in the First Renewal Term, to exercise such option
within 60 days after Landlord's withdrawal of the Cancellation Notice), and
continue to remain in possession under this Lease or terminate this Lease on the
date fixed in the Cancellation Notice. If Tenant elects so to terminate this
Lease, then Tenant shall have no further liability under this Lease upon the
effective date of the termination hereof and Landlord shall indemnify and save
Tenant harmless from and against any and all liability, loss, cost, injury,
damage or other out-of-pocket expense of any nature whatsoever that Tenant may
incur or become subject to as a result of its receipt of the Cancellation
Notice, whether or not Tenant determines to surrender the Demised Premises and
terminate this Lease as a result thereof; such indemnification shall also apply
to any and all out-of-pocket costs and expenses incurred by Tenant with respect
to relocating the conduct of its business to another location in the event that
Landlord elects, after delivery to Tenant of the Cancellation Notice, not to
raze, tear down, demolish or substantially rehabilitate the Building and Tenant
nevertheless elects to terminate the Lease and surrender the Demised Premises to
Landlord as above provided.

        25.07 Promptly following the termination of this Lease pursuant to the
provisions of Section 25.06, but only if Tenant shall have exercised the First
Renewal Option, Landlord must demolish or so alter the character and function of
the Demised Premises such that the same may not, except as hereinafter provided,
thereafter be utilized as a health club, unless the Cancellation Notice is
withdrawn by Landlord at least one (1) year prior to the termination date of the
Lease set forth in such Cancellation Notice and Tenant nevertheless elects to
terminate this Lease in accordance with the terms of the Cancellation Notice as
originally given to Tenant. In the event that Landlord does reopen or use the
Demised Premises as a health club or related facility (other than a health club
facility for use primarily by the residential tenants of such structure and
their guests) within twenty-four (24) months after the termination of this Lease
under the provisions of Section 25.06, Landlord shall be liable to Tenant, if
Tenant shall have exercised the First Renewal Option, for an amount equal to the
rental value of a health club facility that is substantially identical to the
Demised Premises, assuming that the lease covering such facility would have had
a remaining term of at least ten (10) years at the time of determining such
rental value. Such rental value shall be determined by appraisal in accordance
with the procedures provided by Section 25.04 hereof. The provisions of this
Section 25.07 shall survive the expiration or sooner termination or cancellation
of this Lease.

                                   ARTICLE 26
                              SURRENDER OF PREMISES

        At the expiration or sooner termination of the term of this Lease,
Tenant shall surrender the Demised Premises in the same condition as the same
were in upon delivery of possession thereto under this Lease, reasonable wear
and tear and damage by fire, other casualty and the elements excepted, and shall
surrender all keys for the Demised


<PAGE>   35

Premises to Landlord at the place then fixed for the payment of rent and shall
inform Landlord of all combinations on locks, safes and vaults, if any, in the
Demised Premises. Tenant shall at such time surrender all unutilized insurance
proceeds and claims therefor, and shall assign to Landlord its right to receive
any future insurance proceeds with respect to the Demised Premises. Tenant shall
remove all Tenant's Property in accordance with the provisions of Article 14
hereof, and any and all of such property not so removed shall, at Landlord's
option, become the exclusive property of Landlord or may be disposed of by
Landlord.

                                   ARTICLE 27
                                      SIGNS

        Tenant may, during the term of this Lease, upon obtaining any and all
necessary permits from the appropriate governmental authorities, paint or erect
and maintain, at its cost and expense, signs of such dimensions and materials
relating to Tenant's business as it may deem appropriate in or about the Demised
Premises. Such signs shall, at the option of Landlord, be removed by Tenant upon
the termination of its occupancy of the Demised Premises, and Tenant shall be
liable for and shall repair any damage to the Demised Premises caused by such
removal.

                                   ARTICLE 28
                             WAIVER OF TRIAL BY JURY

        Landlord and Tenant each hereby waive trial by jury in any action,
proceeding or counterclaim brought by either against the other upon any matters
whatsoever arising from or in connection with this Lease, Tenant's use or
occupancy of the Demised Premises, except in the case of claims of injury or
damage.

                                   ARTICLE 29

                            MISCELLANEOUS PROVISIONS

        29.01 Notices. All notices, demands and requests under this Lease shall
be in writing and shall be sent by United States registered or certified mail,
postage prepaid, return receipt requested, or by reputable overnight courier
service, and addressed as follows:

   To Tenant:                    Vertical Fitness and
                                 Racquet Club, Ltd.
                                 c/o Health and Tennis Corporation
                                 of America, Inc.
                                 Suite 2810
                                 2029 Century Park East
                                 Los Angeles, California 90067
                                 Attention:   Mr. Tom White

   with copies to:               Miller & Seeger
                                 60 East 42nd Street
                                 New York, New York 10165
                                 Attention: Israel G. Seeger, Esq.

                                 Lurie, Sklar & Simon, Ltd.
                                 180 North Michigan Avenue
                                 Chicago, Illinois 60601
                                 Attention: Michael L. Sklar, Esq.

                                 Skadden, Arps; Slate, Meagher & Flom
                                 919 Third Avenue


<PAGE>   36

                                 New York, New York 10022
                                 Attention: Benjamin F. Needell, Esq.

   To Landlord:                  Hirschfeld Realty Club Corporation
                                 336 East 61st Street
                                 New York, New York 10021
                                 Attention: Mr. Abraham J. Hirschfeld

                                      -and-

                                 328 E. 61 Corp.
                                 336 East 61st Street
                                 New York, New York 10021
                                 Attention: Mr. Abraham J. Hirschfeld

   with a copy to:               Hirschfeld Realty
                                 336 East 61st Street
                                 New York, New York 10021
                                 Attention: Mr. Elie Hirschfeld

Notice, demands and requests delivered by Tenant to either 328 or Hirschfeld (at
the addresses provided herein or such other addresses designated by such parties
pursuant to the provisions hereof), shall be deemed to have been served or given
to Landlord for all purposes under this Lease. Either party may, by notice given
to the other party, designate a new address to which notices, demands and
requests shall be sent and, thereafter, any of the foregoing shall be sent to
the address most recently designated by such party. Notices, demands and
requests which shall be served upon Landlord or Tenant (a) if sent by registered
or certified mail in the manner as aforesaid, shall be deemed to have been
served or given for all purposes under this Lease three (3) business days after
such notice, demand or request shall be sent in the manner provided herein or
(b) if sent by reputable overnight courier, shall be deemed to have been served
or given for all purposes under this Lease on the date of actual delivery or
rejection of such a properly addressed notice, demand or request.

        29.02 Consents. Any consent or approval required of either of the
parties hereto under the terms of this Lease shall be deemed given if not
objected to within thirty (30) days of the delivery of the notice requesting
such consent or approval.

        29.03 Entire Agreement. This Lease and the Exhibits attached hereto sets
forth the entire agreement between the parties hereto with respect to the
subject matter hereof and supersedes all prior understandings, discussions,
negotiations and representations, if any, with respect thereto. No subsequent
amendment to this Lease shall be binding upon Landlord or Tenant unless reduced
to writing and signed by Landlord and Tenant.

        29.04 Binding Effect; Successors and Assigns. Subject to the terms and
conditions of this Lease, the covenants, conditions and agreements contained in
this Lease shall be binding upon and inure to the benefit of Landlord and Tenant
and their respective legal representatives, successors and permitted assigns.

        29.05 Invalidity of Particular Provisions. If any term or provision of
this Lease or the application thereof to any persons or circumstances shall, to
any extent, be invalid or unenforceable, the remainder of this Lease or the
application of such term or provision to other persons or circumstances shall
not be affected thereby, and each term and provision of this Lease shall be
valid and be enforced to the fullest extent permitted by law.

        29.06 Captions. Captions or titles of the sections, paragraphs and
subparagraphs of this Lease are inserted solely for convenience of reference and
shall not constitute a part of this Lease, nor shall they affect its meaning,
construction or effect.


<PAGE>   37

        29.07 Non-Merger. The leasehold estate created by this Lease shall not
merge with the fee estate in the event that the same person or entity acquires,
owns or holds, directly or indirectly, the fee estate and the leasehold estate
in the Demised Premises.

        29.08 Interpretation of Words. A masculine pronoun wherever used herein
shall be construed to include the feminine or neuter where appropriate. The
singular form wherever used herein shall be construed to include the plural
where appropriate and vice versa.

        29.09 Governing Law. This Agreement shall be governed by and construed
in accordance with the laws of the State of New York.

        29.10 Further Documents. Each of the parties hereto agrees to execute,
acknowledge and deliver or cause to be delivered such other deeds, documents,
affidavits and certificates as the other party may from time to time reasonably
request in order to confirm this Agreement and the performance of the
obligations of such party under the terms hereof or to confirm the expiration or
sooner termination of the term of this Lease, in such form as shall be
reasonably satisfactory to the other respective party.

        29.11 Counterparts. This Lease may be executed in any number of
counterparts, each of which shall be deemed an original and all of which shall
constitute but one and the same instrument.

        29.12 Relationship of the Parties. It is the intention of the parties
hereto to create the relationship of Landlord and Tenant, and unless expressly
otherwise provided herein, nothing contained herein shall be construed to make
the parties hereto liable for any of the debts, liabilities or obligations of
the other party.

        29.13 Ownership of Leased Premises. Tenant acknowledges that the Demised
Premises are the property of Landlord and that Tenant has only the right to the
possession and use thereof upon the terms, covenants and conditions set forth in
this Lease. Landlord represents claims and liabilities arising out of or
resulting from ownership of the Demised Premises subsequent to the effective
date of such sale or transfer.

        IN WITNESS WEEREOF, the parties hereto have duly executed this Lease as
of the day and year first above written.

ATTEST:                                     HIRSCHFELD REALTY CLUB
                                              CORPORATION LANDLORD


/s/ ELIE HIRSCHFELD                         BY: /s/ ABRAHAM HIRSCHFELD
----------------------------------             ---------------------------------
(Assistant)  Secretary                         (Vice) President



ATTEST:                                     328 E. 61 CORP.  LANDLORD


/s/ ELIE HIRSCHFELD                         BY:   /s/ ABRAHAM HIRSCHFELD
----------------------------------             ---------------------------------
(Assistant)  Secretary                         (Vice) President



                                            VERTICAL FITNESS AND RACQUET
                                              CLUB, LTD., TENANT


<PAGE>   38

ATTEST:


/s/ MICHAEL SKLAR                           BY:   /s/ ROY ZURKOWSKI
----------------------------------             ---------------------------------
(Assistant)  Secretary                         (Vice) President



Consented TO BY GUARANTOR FOR
REMAINING TERM OF GUARANTY

HEALTH AND TENNIS CORPORATION
  OF AMERICA, INC.

By:  /s/ ROY ZURKOWSKI
----------------------------------
    (Vice) President



<PAGE>   39

STATE OF NEW YORK            )
                             : ss. :
COUNTY OF NEW YORK           )

        On the 26th day of March, 1985, before me came Abraham Hirschfeld, to me
known, who, being by me duly sworn, did depose and say that he resides at 825
Fifth Avenue, New York, New York; that he is the (Vice) President of HIRSCHFELD
REALTY CLUB CORPORATION, the corporation described in and which executed the
foregoing instrument by order of the Board of Directors of said corporation and
that he signed his name thereto by like order.


                                            /s/ JOAN B. MOLLOY
                                               ---------------------------------
                                               Notary Public


                                                        JOAN B. MOLLOY
                                               Notary Public, State of New York
                                                          No 4721246
                                                Qualified in Westchester County
                                               Commission Expires March 30, 1986


STATE OF NEW YORK            )
                             : ss. :
COUNTY OF NEW YORK           )

   On the 26th day of March, 1985, before me came Elie Hirschfeld to me known,
who, being by me duly sworn, did depose and say that he resides at 425 E. 50th
Street, New York, New York; that he is the (Assistant) Secretary of HIRSCHFELD
REALTY CLUB CORPORATION, the corporation described in and which executed the
foregoing instrument by order of the Board of Directors of said corporation and
that he signed his name thereto by like order.


                                            /s/ JOAN B. MOLLOY
                                               ---------------------------------
                                               Notary Public


                                                       JOAN B. MOLLOY
                                               Notary Public, State of New York
                                                          No 4721246
                                               Qualified in Westchester County
                                               Commission Expires March 30, 1986


<PAGE>   40

STATE OF NEW YORK            )
                             : ss. :
COUNTY OF NEW YORK           )

        On the 26th,day of March, 1985, before me came Abraham Hirschfeld to me
known, who, being by me duly sworn, did depose and say that he resides at 825
Fifth Avenue, New York, New York; that he is the (Vice) President of 328 E. 61
Corp., the corporation described in and which executed the foregoing instrument
by order of the Board of Directors of said corporation and that he signed his
name thereto by like order.


                                            /s/ JOAN B. MOLLOY 
                                               ---------------------------------
                                               Notary Public

                                                       JOAN B. MOLLOY
                                                Notary Public, State of New York
                                                         No 4721246
                                                Qualified in Westchester County
                                               Commission Expires March 30, 1986



STATE OF NEW YORK            )
                             : ss. :
COUNTY OF NEW YORK           )

        On the 26th,day of March, 1985, before me came Elie Hirschfeld to me
known, who, being by me duly sworn, did depose and say that he resides at 425 E.
5th Street, New York, New York; that he is the (Assistant) Secretary of 328 E.
61 Corp., the corporation described in and which executed the foregoing
instrument by order of the Board of Directors of said corporation and that he
signed his name thereto by like order.


                                            /s/ JOAN B. MOLLOY
                                               ---------------------------------
                                               Notary Public

                                                        JOAN B. MOLLOY
                                               Notary Public, State of New York
                                                          No 4721246
                                                Qualified in Westchester County
                                               Commission Expires March 30, 1986


<PAGE>   41

STATE OF NEW YORK            )
                             : ss. :
COUNTY OF NEW YORK           )

        On the 26th,day of March, 1985, before me came Roy Zurkowski, to me
known, who, being by me duly sworn, did depose and say that he resides at 451
Goodhue Road, Bloomfield, Michigan; that he is the (Vice) President of VERTICAL
FITNESS AND RACQUET CLUB, LTD., the corporation described in and which executed
the foregoing instrument by order of the Board of Directors of said corporation
and that he signed his name thereto by like order.


                                            /s/ JOAN B. MOLLOY
                                               ---------------------------------
                                               Notary Public

                                                        JOAN B. MOLLOY
                                               Notary Public, State of New York
                                                         No 4721246
                                                Qualified in Westchester County
                                               Commission Expires March 30, 1986



STATE OF NEW YORK            )
                             : ss. :
COUNTY OF NEW YORK           )

        On the 26th,day of March, 1985, before me came Michael Sklar, to me
known, who, being by me duly sworn, did depose and say that he resides at 379
Dell Lane, Highland Park, Illinois; that he is the (Vice) President of
HIRSCHFELD REALTY CLUB CORPORATION, the corporation described in and which
executed the foregoing instrument by order of the Board of Directors of said
corporation and that he signed his name thereto by like order.


                                            /s/ JOAN B. MOLLOY
                                               ---------------------------------
                                               Notary Public

                                                       JOAN B. MOLLOY
                                               Notary Public, State of New York
                                                          No 4721246
                                                Qualified in Westchester County
                                               Commission Expires March 30, 1986