CREDIT AGREEMENT
                                   dated as of
                                  June 15, 1998
                                     between
                        RECKSON SERVICE INDUSTRIES, INC.,
                                   as Borrower
                                       and
                      RECKSON OPERATING PARTNERSHIP, L.P.,
                                    as Lender
                                   relating to
                     RECKSON STRATEGIC VENTURE PARTNERS, LLC


<PAGE>
                                Table of Contents

                                                                            Page
                                                                            ----
                                   ARTICLE I.
                            DEFINITIONS
  Section 1.1 Definitions......................................................1
           (a)      Terms Generally............................................1
           (b)      Other Terms................................................1

                            ARTICLE II.
                   THE REVOLVING CREDIT FACILITY
  Section 2.1 Commitment and Loans.............................................6
  Section 2.2 Borrowing Procedure..............................................6
  Section 2.3 Termination and Reduction of Commitment..........................6
  Section 2.4 Repayment........................................................6
  Section 2.5 Optional Prepayment..............................................7

                           ARTICLE III.
                         INTEREST AND FEES
  Section 3.1 Interest Rate....................................................7
  Section 3.2 Interest on Overdue Amounts......................................7
  Section 3.3 Maximum Interest Rate............................................8

                            ARTICLE IV.
                     DISBURSEMENT AND PAYMENT
  Section 4.1 Method and Time of Payments......................................8
  Section 4.2 Compensation for Losses..........................................9
  Section 4.3 Withholding and Additional Costs.................................9
           (a)      Withholding................................................9
           (b)      Additional Costs..........................................10
           (c)      Certificate, Etc..........................................10
  Section 4.4 Expenses; Indemnity.............................................10
  Section 4.5 Survival........................................................11

                            ARTICLE V.
                  REPRESENTATIONS AND WARRANTIES
  Section 5.1 Representations and Warranties..................................11
           (a)      Good Standing and Power...................................11
           (b)      Authority.................................................11
           (c)      Authorizations............................................12
           (d)      Binding Obligation........................................12
           (e)      Litigation................................................12
           (f)      No Conflicts..............................................12
           (g)      Taxes.....................................................12
           (h)      Properties................................................12
           (i)      Compliance with Laws and Charter Documents................13
           (j)      No Material Adverse Effect................................13
           (k)      Disclosure................................................13
  Section 5.2 Survival........................................................13

                            ARTICLE VI.
                       CONDITIONS PRECEDENT
  Section 6.1 Conditions to the Availability of the Commitment................13
           (a)      This Agreement............................................13
           (b)      Certificate of Incorporation and By-Laws..................13
           (c)      Representations and Warranties............................14
           (d)      Other Documents...........................................14
           (e)      REIT Status of Reckson....................................14
           (f)      Certain Loans Subject to Reckson's Approval...............14
  Section 6.2 Conditions to All Loans.........................................14
           (a)      Borrowing Request.........................................14
           (b)      No Default................................................14
           (c)      Debt-to-Equity Ratio......................................14
           (d)      Representations and Warranties; Covenants.................14
  Section 6.3 Satisfaction of Conditions Precedent............................15

                           ARTICLE VII.
                             COVENANTS
  Section 7.1 Affirmative Covenants...........................................15
           (a)      Financial Statements; Compliance Certificates.............15
           (b)      Existence.................................................15
           (c)      Compliance with Law and Agreements........................16
           (d)      Authorizations............................................16
           (e)      Inspection................................................16
           (f)      Maintenance of Records....................................16
           (g)      Notice of Defaults and Adverse Developments...............16
  Section 7.2 Negative Covenants..............................................16
           (a)      Mergers, Consolidations and Sales of Assets...............17
           (b)      Liens.....................................................17
           (c)      Indebtedness..............................................17
           (d)      Dividends.................................................17
           (e)      Certain Amendments........................................17

                           ARTICLE VIII.
                         EVENTS OF DEFAULT
  Section 8.1 Events of Default...............................................17

                            ARTICLE IX.
                   EVIDENCE OF LOANS; TRANSFERS
  Section 9.1 Evidence of Loans...............................................19

                            ARTICLE X.
                           MISCELLANEOUS
  Section 10.1 Applicable Law.................................................20
  Section 10.2 Waiver of Jury.................................................20
  Section 10.3 Jurisdiction and Venue; Service of Process.....................20
  Section 10.4 Confidentiality................................................21
  Section 10.5 Amendments and Waivers.........................................21
  Section 10.6 Cumulative Rights; No Waiver...................................21
  Section 10.7 Notices........................................................21
  Section 10.8 Certain Acknowledgments........................................22
  Section 10.9 Separability...................................................22
  Section 10.10 Parties in Interest...........................................22
  Section 10.11 Execution in Counterparts.....................................22




<PAGE>


                  CREDIT AGREEMENT,  dated as of June 15, 1998,  between Reckson
Service  Industries,   Inc.,  a  Delaware  corporation,  and  Reckson  Operating
Partnership,  L.P., a Delaware limited partnership relating to Reckson Strategic
Venture Partners, LLC ("RSVP").


                              W I T N E S S E T H:

                  WHEREAS,  the Borrower has  requested  the Lender to commit to
lend to the Borrower up to $100 million on a revolving  basis for  investment in
RSVP; and

                  WHEREAS,  the Lender is willing to make revolving credit loans
on the terms and conditions provided herein;

                  NOW, THEREFORE, the parties agree as follows:

ARTICLE I.........
                                   DEFINITIONS
Section 1.1        Definitions.

(a) Terms Generally . The definitions  ascribed to terms in this Agreement apply
equally  to both the  singular  and plural  forms of such  terms.  Whenever  the
context may require,  any pronoun  shall be deemed to include the  corresponding
masculine,  feminine  and neuter  forms.  The words  "include",  "includes"  and
"including"  shall  be  interpreted  as  if  followed  by  the  phrase  "without
limitation".  The  phrase  "individually  or in the  aggregate"  shall be deemed
general  in scope  and not to refer to any  specific  Section  or clause of this
Agreement. All references herein to Articles,  Sections,  Exhibits and Schedules
shall be deemed  references  to  Articles  and  Sections  of, and  Exhibits  and
Schedules to, this Agreement  unless the context shall  otherwise  require.  The
table of contents,  headings  and  captions  herein shall not be given effect in
interpreting or construing the provisions of this Agreement. Except as otherwise
expressly  provided  herein,  all references to "dollars" or "$" shall be deemed
references to the lawful money of the United States of America.

(b) Other Terms . The following  terms have the meanings  ascribed to them below
or in the Sections of this Agreement indicated below:

                  "Adjusted  Indebtedness"  means, with respect to the Borrower,
         the Borrower's  Indebtedness  determined without regard for any amounts
         described in clause (viii) of the definition of "Indebtedness."

                  "Affiliate"  means,  with  respect  to any  Person,  any other
         Person that  controls,  is  controlled  by, or is under common  control
         with, such Person.

                  "Agreement" means this credit agreement, as it may be amended,
         modified or supplemented from time to time.

                  "Available  Commitment"  means, on any day, an amount equal to
         (i) the  Commitment  on such day minus (ii) the  aggregate  outstanding
         principal amount of Loans on such day.

                  "Borrower" means Reckson Service Industries,  Inc., a Delaware
         corporation.

                  "Borrowing Date" means, with respect to any Loan, the Business
         Day set forth in the relevant  Borrowing Request as the date upon which
         the Borrower desires to borrow such Loan;

                  "Borrowing  Request"  means a request  by the  Borrower  for a
         Loan, which shall specify (i) the requested Borrowing Date and (ii) the
         aggregate amount of such Loan.

                  "Business Day" means any day that is not a Saturday, Sunday or
         other  day on  which  commercial  banks  in The  City of New  York  are
         authorized by law to close.

                  "Capital Lease Obligations" means, with respect to any Person,
         the  obligation  of such Person to pay rent or other  amounts under any
         lease with respect to any property  (whether  real,  personal or mixed)
         acquired or leased by such Person that is required to be accounted  for
         as a liability on a consolidated balance sheet of such Person.

                  "Commitment"  means $100  million less (i) the amount of loans
         made by the Lender to the Borrower for the funding of investments  made
         by RSVP prior to the spin-off distribution of shares of common stock of
         Borrower by Reckson and (ii) the amount of any investments  made by the
         Lender in joint venture  investments made with RSVP, and as such amount
         may be reduced from time to time pursuant to Section 2.3.

                  "Commitment  Termination  Date"  means the earlier to occur of
         (i) June 15, 2003 and (ii) the date, if any, on which the Commitment is
         terminated.

                  "Confidential  Information" means information delivered to the
         Lender  by  or on  behalf  of  the  Borrower  in  connection  with  the
         transactions  contemplated  by or otherwise  pursuant to this Agreement
         that is  confidential  or  proprietary  in  nature at the time it is so
         delivered  or  information  obtained by the Lender in the course of its
         review of the books or records  of the  Borrower  contemplated  herein;
         provided  that  such  term  shall not  include  information  W that was
         publicly  known or  otherwise  known to the Lender prior to the time of
         such disclosure,  (ii) that subsequently becomes publicly known through
         no act or omission by the Lender or any Person  acting on the  Lender's
         behalf,  (iii) that  otherwise  becomes  known to the Lender other than
         through  disclosure by the Borrower or (iv) that constitutes  financial
         information   delivered  to  the  Lender  that  is  otherwise  publicly
         available.

                  "Default"  means any  event or  circumstance  which,  with the
         giving of notice or the passage of time, or both,  would be an Event of
         Default.

                  "EBITDA" means for any fiscal  period,  the  Consolidated  Net
         Income or  Consolidated  Net Loss,  as the case may be, for such fiscal
         period,  after restoring thereto amounts deducted for (a) extraordinary
         losses (or deducting  therefrom any amounts included therein on account
         of  extraordinary  gains) and special  charges,  (b)  depreciation  and
         amortization (including write-offs or write-downs) and special charges,
         (c)  the  amount  of  interest   expense  of  the   Borrower   and  its
         Subsidiaries,  if any, determined on a consolidated basis in accordance
         with GAAP, for such period on the aggregate  principal  amount of their
         consolidated  indebtedness,  (d)  the  amount  of  tax  expense  of the
         Borrower and its  Subsidiaries,  if any,  determined on a  consolidated
         basis in  accordance  with GAAP,  for such period and (e) the aggregate
         amount of fixed and contingent  rentals payable by the Borrower and its
         Subsidiaries,  if any, determined on a consolidated basis in accordance
         with GAAP,  for such period with respect to leases of real and personal
         property.

                  "Effective  Date"  has the  meaning  assigned  to such term in
         Section 6.1.

                  "Event of Default"  has the  meaning  assigned to such term in
         Section 8.1.

                  "GAAP" means generally accepted accounting principles,  as set
         forth in the opinions and  pronouncements of the Accounting  Principles
         Board of the American  Institute of Certified  Public  Accountants  and
         statements and  pronouncements  of the Financial  Accounting  Standards
         Board or in such  other  statements  by such other  entities  as may be
         approved by a significant  segment of the accounting  profession of the
         United States of America.

                  "Governmental  Authority" means any nation or government,  any
         state or other political  subdivision thereof and any entity exercising
         executive,   legislative,   judicial,   regulatory  or   administrative
         functions of or pertaining to government.

                  "Guaranty" means, with respect to any Person,  any obligation,
         contingent  or  otherwise,  of such Person  guaranteeing  or having the
         economic  effect of guaranteeing  any  Indebtedness of any other Person
         (the "primary obligor") in any manner,  whether directly or indirectly,
         and including any  obligation of such Person (i) to purchase or pay (or
         advance  or  supply   funds  for  the  purchase  or  payment  of)  such
         Indebtedness  or to  purchase  (or to advance  or supply  funds for the
         purchase of) any security for the payment of such Indebtedness, (ii) to
         purchase  property,  securities or services for the purpose of assuring
         the holder of such  Indebtedness of the payment of such Indebtedness or
         (iii) to maintain  working  capital,  equity  capital or the  financial
         condition  or  liquidity  of the  primary  obligor  so as to enable the
         primary obligor to pay such  Indebtedness.  The term "Guaranteed" shall
         have the corresponding meaning.

                  "Indebtedness"  means,  with  respect to any  Person,  (i) all
         obligations  of such  Person  for  borrowed  money or for the  deferred
         purchase  price of  property or services  (including  all  obligations,
         contingent or otherwise,  of such Person in connection  with letters of
         credit, bankers' acceptances,  interest rate swap agreements,  interest
         rate cap agreements or other similar  instruments,  including  currency
         swaps) other than indebtedness to trade creditors and service providers
         incurred in the  ordinary  course of business  and payable on usual and
         customary  terms,  (ii) all  obligations  of such Person  evidenced  by
         bonds,  notes,  debentures  or other  similar  instruments,  (iii)  all
         indebtedness  created or arising  under any  conditional  sale or other
         title  retention  agreement  with respect to property  acquired by such
         Person  (even  though the  remedies  available  to the seller or lender
         under  such  agreement  are  limited  to  repossession  or sale of such
         property),  (iv) all Capital Lease Obligations of such Person,  (v) all
         obligations of the types described in clauses (i), (ii),  (iii) or (iv)
         above  secured  by (or for which the  obligee  has an  existing  right,
         contingent  or  otherwise,  to be  secured  by) any Lien upon or in any
         property  (including  accounts,  contract rights and other intangibles)
         owned by such Person, even though such Person has not assumed or become
         liable for the payment of such  Indebtedness,  (vi) all preferred stock
         issued by such Person which is redeemable,  prior to full  satisfaction
         of the Borrower's obligations under this Agreement (including repayment
         in full of the Loans and all interest accrued  thereon),  other than at
         the option of such  Person,  valued at the greater of its  voluntary or
         involuntary  liquidation  preference plus accrued and unpaid dividends,
         (vii) all  Indebtedness of others  Guaranteed by such Person and (viii)
         all  Indebtedness  of any partnership of which such Person is a general
         partner.

                  "Indemnitee"  has the meaning assigned to such term in Section
         4.4(b).

                  "Intercompany  Agreement"  means the  intercompany  agreement,
         dated  as of the date  hereof,  by and  between  the  Borrower  and the
         Lender.

                  "Interest  Period"  means,  with  respect  to any  Loan,  each
         three-month  period  commencing on the date such Loan is made or at the
         end of the preceding  Interest  Period,  as the case may be;  provided,
         however, that:

(i)               any Interest  Period that would otherwise end on a day that is
                  not a Business Day shall be extended to the next Business Day,
                  unless such Business Day falls in another  calendar  month, in
                  which  case  such  Interest  Period  shall  end  on  the  next
                  preceding Business Day;

(ii)              any Interest  Period that begins on the last Business Day of a
                  calendar  month (or on a day for which there is no numerically
                  corresponding  day in the  calendar  month  at the end of such
                  Interest Period) shall,  subject to clause (iii) below, end on
                  the last Business Day of a calendar month; and

(iii)             any  Interest  Period  that  would  otherwise  end  after  the
                  Commitment  Termination  Date then in effect shall end on such
                  Commitment Termination Date.

                  "Lender" means Reckson Operating Partnership, L.P., a Delaware
         limited partnership.

                  "Lien" means,  with respect to any asset of a Person,  (i) any
         mortgage, deed of trust, lien, pledge, encumbrance,  charge or security
         interest in or on such asset,  (ii) the  interest of a vendor or lessor
         under any conditional sale agreement,  capital lease or title retention
         agreement  relating to such asset, and (iii) in the case of securities,
         any  purchase  option,  call or similar  right of any other Person with
         respect to such securities.

                  "Loans" has the meaning assigned to such term in Section 2.1.

                  "Material  Adverse  Effect"  means any  material  and  adverse
         effect  on  (i)  the  consolidated  business,   properties,   condition
         (financial or otherwise) or operations,  present or prospective, of the
         Borrower and its Subsidiaries,  (ii) the ability of the Borrower timely
         to  perform  any of its  material  obligations,  or of  the  Lender  to
         exercise  any  remedy,  under  this  Agreement  or (iii) the  legality,
         validity, binding nature or enforceability of this Agreement.

                  "Net Assets" means, with respect to the Borrower,  the greater
         of (i) the sum of the Borrower's  paid-in capital and retained earnings
         or (ii) the excess of the Value of all of the Borrower's  assets of any
         kind over the Borrower's Adjusted Indebtedness.

                  "Permitted  Liens" means,  collectively,  the  following:  (i)
         Liens  expressly  approved by the Lender,  which  approval shall not be
         unreasonably withheld; (ii) Liens imposed by any Governmental Authority
         for  taxes,  assessments  or  charges  not yet due or  that  are  being
         contested  in good  faith  by  appropriate  proceedings  and for  which
         adequate  reserves are being  maintained (in accordance with GAAP); and
         (iii) Liens existing on the date hereof.

                  "Person"   means   any   individual,    sole   proprietorship,
         partnership,   joint  venture,  trust,   unincorporated   organization,
         association,  corporation,  institution,  public  benefit  corporation,
         entity or government (whether Federal,  state,  county, city, municipal
         or otherwise, including any instrumentality,  division, agency, body or
         department thereof).

                  "Prime Rate" means the prime rate (or if a range is given, the
         highest  prime  rate)  listed  under  "Money  Rates" in The Wall Street
         Journal for such date or, if The Wall Street  Journal is not  published
         on such date, then in The Wall Street Journal most recently published.

                  "Reckson"  means Reckson  Associates  Realty Corp., a Maryland
         corporation.

                  "Responsible  Officer"  means  the  chief  executive  officer,
         president, chief financial officer, chief accounting officer, treasurer
         or  any  vice  president,  senior  vice  president  or  executive  vice
         president of the General Partner.

                  "RSI Facility  Agreement" means the credit agreement dated the
         date hereof between Borrower and Lender in respect of the operations of
         Reckson Service Industries, Inc.

                  "RSVP  Platform"  means a particular real estate market sector
         in which RSVP invests.

                  "SEC" means the  Securities  and Exchange  Commission  (or any
         successor Governmental Authority).

                  "Subsidiary"  means,  at any  time  and  with  respect  to any
         Person,  any  other  Person  the  shares  of stock  or other  ownership
         interests of which having  ordinary voting power to elect a majority of
         the board of directors or with respect to other  matters of such Person
         are at the  time  owned,  or the  management  or  policies  of which is
         otherwise at the time controlled, directly or indirectly through one or
         more  intermediaries  (including  other  Subsidiaries) or both, by such
         first  Person.  Unless  otherwise  qualified  or the context  indicates
         clearly  to  the  contrary,   all  references  to  a  "Subsidiary"   or
         "Subsidiaries"  in this Agreement refer to a Subsidiary or Subsidiaries
         of the Borrower.

                  "Taxes"  has the  meaning  assigned  to such  term in  Section
         4.3(a).

                  "Value"  means,  with  respect  to  any  asset  owned  by  the
         Borrower,  the present value of the net cash flow reasonably  projected
         by the Borrower to be received  with  respect to its  ownership of such
         assets,  discounted  at an interest  rate that the Borrower  reasonably
         determines  appropriate  given the risks associated with such asset and
         such projected net cash flow, but in no event at an interest rate lower
         than  2%  above  the  Prime  Rate  in  effect  at  the  time  that  the
         determination of Value is made.

ARTICLE II.
                          THE REVOLVING CREDIT FACILITY

Section  2.1  Commitment  and Loans . Until  the  Commitment  Termination  Date,
subject to the terms and conditions of this Agreement, the Lender agrees to make
revolving credit loans (collectively,  "Loans") in dollars to the Borrower in an
aggregate  principal  amount  at any one  time  outstanding  not to  exceed  the
Commitment.

Section 2.2 Borrowing  Procedure . In order to borrow a Loan, the Borrower shall
give a Borrowing  Request to the Lender,  by telephone,  telex or telecopy or in
writing,  not later than 10:30 A.M.,  New York time,  on the third  Business Day
before the  Borrowing  Date (or such later time or date as the Lender may in its
sole  discretion  permit).  (If any Borrowing  Request is made otherwise than in
writing,  Borrower  shall promptly  confirm such Borrowing  Request in writing.)
Subject to  satisfaction,  or waiver by the  Lender,  of each of the  applicable
conditions  precedent  contained in Article VI, on the Borrowing Date the Lender
shall make available, in immediately available funds, to the Borrower the amount
of the requested Loan.

Section 2.3 Termination and Reduction of Commitment . The Borrower may terminate
the Commitment,  or reduce the amount  thereof,  by giving written notice to the
Lender, not later than 5:00 P.M., New York time, on the fifth Business Day prior
to the date of  termination  or  reduction  (or such  later  time or date as the
Lender may in its sole discretion permit).

Section 2.4  Repayment . Loans  shall be repaid,  together  with all accrued and
unpaid interest thereon, on the Commitment Termination Date.

Section 2.5 Optional Prepayment . The Borrower may prepay Loans by giving notice
(specifying  the Loans to be prepaid in whole or in part,  the principal  amount
thereof to be prepaid and the date of prepayment)  to the Lender,  by telephone,
telex,  telecopy or in writing not later than 12:00 noon,  New York time, on the
fourth  Business Day preceding  the proposed  date of prepayment  (or such later
time or date as the  Lender  may in its sole  discretion  permit).  (If any such
prepayment  notice is made  otherwise  than in writing,  Borrower shall promptly
confirm such notice in writing.) Each such prepayment  shall be at the aggregate
principal amount of the principal being prepaid,  together with accrued interest
on the  principal  being  prepaid  to the  date of  prepayment  and the  amounts
required by Section 4.3.  Subject to the terms and conditions of this Agreement,
prepaid Loans may be reborrowed.


ARTICLE III.

                                INTEREST AND FEES

Section 3.1  Interest  Rate . Each Loan shall bear  interest  from the date made
until the date repaid,  payable in arrears,  with respect to Interest Periods of
three months or less, on the last day of such Interest Period,  and with respect
to Interest  Periods longer than three months,  on the day which is three months
after  the  commencement  of such  Interest  Period  and on the last day of such
Interest Period,  at a rate per annum equal to the greater of (i) the sum of (x)
2% and (y) the Prime Rate for the applicable  Interest Period and (ii) 12%. With
respect to each Loan  outstanding  for one year or  longer,  such 12% rate shall
increase  to 12.48%,  12.98%,  13.50% and  14.04% as of the  anniversary  of the
making of such Loan,  for the  second,  third,  fourth and fifth years that such
Loan is outstanding, respectively.  Notwithstanding the foregoing, if the amount
of  interest  to be paid by the  Borrower  to the Lender  exceeds  the amount of
EBITDA of the Borrower for the immediately  preceding  calendar  quarter (ending
the last day of September,  December, March, or June), the Borrower shall not be
obligated  to repay the amount of interest  in excess of EBITDA of the  Borrower
for such period.  Any such amount of unpaid interest shall be added to principal
and shall accrue  interests  thereon.  Payments under the Notes shall be applied
first to any fees,  costs or expenses due under the Notes or hereunder,  then to
interest,  and then to principal.  Notwithstanding  any other  provision of this
Agreement,  all  outstanding  principal  and  interest of the Loan and all other
amounts payable  hereunder,  if not sooner paid, shall be due and payable on the
Commitment Termination Date.

Section  3.2  Interest  on  Overdue  Amounts . All  overdue  amounts  (including
principal,  interest and fees)  hereunder,  and,  during the  continuance of any
Event of Default  that  shall have  occurred,  each Loan,  shall bear  interest,
payable on demand,  at a rate per annum  equal to the  greater of (i) the sum of
(x) 3% and (y) Prime Rate for the applicable  Interest Period and (ii) 13%. With
respect to each Loan  outstanding  for one year or  longer,  such 13% rate shall
increase  to 13.48%,  13.98%,  14.50% and  15.04% as of the  anniversary  of the
making of such Loan for the second, third, fourth and fifth years that such Loan
is outstanding, respectively.

Section 3.3

         Maximum Interest Rate . (a) Nothing in this Agreement shall require the
Borrower to pay  interest at a rate  exceeding  the maximum  rate  permitted  by
applicable  law.  Neither this Section nor Section 10.1 is intended to limit the
rate of  interest  payable  for the  account of the Lender to the  maximum  rate
permitted by the laws of the State of New York (or any other  applicable law) if
a higher rate is permitted with respect to the Lender by supervening  provisions
of U.S. Federal law.

         (b) If the amount of interest  payable for the account of the Lender on
any  interest  payment  date in respect of the  immediately  preceding  interest
computation  period,  computed  pursuant to this Article  III,  would exceed the
maximum  amount  permitted by  applicable  law to be charged by the Lender,  the
amount of interest  payable for its account on such interest  payment date shall
automatically be reduced to such maximum permissible amount.

         (c) If the amount of interest  payable for the account of the Lender in
respect of any interest computation period is reduced pursuant to Section 3.3(b)
and the amount of interest  payable for its account in respect of any subsequent
interest  computation  period would be less than the maximum amount permitted by
law to be charged by the  Lender,  then the amount of  interest  payable for its
account in respect  of such  subsequent  interest  computation  period  shall be
automatically  increased to such maximum permissible amount; provided that at no
time shall the  aggregate  amount by which  interest paid for the account of the
Lender has been  increased  pursuant to this Section 3.3(c) exceed the aggregate
amount by which  interest  paid for its account  has  theretofore  been  reduced
pursuant to Section 3.3(b).

ARTICLE IV.
                            DISBURSEMENT AND PAYMENT

Section 4.1       Method and Time of Payments .

         (a) All payments by the Borrower hereunder shall be made without setoff
or  counterclaim to the Lender,  for its account,  in dollars and in immediately
available funds to the account of the Lender  theretofore  designated in writing
to the Borrower not later than 12:00 noon,  New York time,  on the date when due
or,  in the  case of  payments  pursuant  to  Sections  4.3 and 4.4 or  payments
otherwise  specified  as payable  upon demand,  forthwith  upon  written  demand
therefor.

         (b) Whenever  any payment from the Borrower  shall be due on a day that
is not a Business Day, the date of payment thereof shall be extended to the next
succeeding Business Day. If the date for any payment of principal is extended by
operation  of law or  otherwise,  interest  thereon  shall be  payable  for such
extended time.


<PAGE>




Section 4.2  Compensation  for Losses . (a) If (i) the Borrower  prepays  Loans,
(ii) the  Borrower  revokes any  Borrowing  Request or (iii) Loans (or  portions
thereof)  shall become or be declared to be due prior to the scheduled  maturity
thereof,  then  the  Borrower  shall  pay to the  Lender  an  amount  that  will
compensate  the  Lender  for any loss  (other  than lost  profit)  or premium or
penalty  incurred by the Lender as a result of such  prepayment,  declaration or
revocation in respect of funds obtained for the purpose of making or maintaining
the Lender's Loans, or any portion thereof.  Such compensation  shall include an
amount  equal to the excess,  if any,  of (i) the amount of interest  that would
have accrued on the amount so paid or prepaid,  or not borrowed,  for the period
from the date of such payment or prepayment or failure to borrow to the last day
of such  Interest  Period (or, in the case of a failure to borrow,  the Interest
Period that would have commenced on the expected Borrowing Date) in each case at
the  applicable  rate of interest for such Loan over (ii) the amount of interest
(as reasonably  determined by the Lender) that would have accrued on such amount
were it on deposit  for a  comparable  period with  leading  banks in the London
interbank market.

         (b) If  requested by the  Borrower,  in  connection  with a payment due
pursuant  to this  Section  4.2,  the Lender  shall  provide  to the  Borrower a
certificate setting forth in reasonable detail the amount required to be paid by
the Borrower to the Lender and the computations  made by the Lender to determine
such  amount.  In the  absence of  manifest  error,  such  certificate  shall be
conclusive as to the amount required to be paid.

Section 4.3       Withholding and Additional Costs .

         (a) Withholding . All payments under this Agreement (including payments
of principal and interest)  shall be payable to the Lender free and clear of any
and  all  present  and  future  taxes,  levies,  imposts,  duties,   deductions,
withholdings, fees, liabilities and similar charges (collectively, "Taxes") . If
any Taxes are required to be withheld or deducted from any amount  payable under
this Agreement,  then the amount payable under this Agreement shall be increased
to the amount which,  after  deduction from such  increased  amount of all Taxes
required  to be withheld  or  deducted  therefrom,  will yield to the Lender the
amount stated to be payable under this  Agreement.  The Borrower shall also hold
the Lender  harmless and  indemnify it for any stamp or other taxes with respect
to the preparation,  execution, delivery, recording,  performance or enforcement
of this  Agreement (all of which shall be included  within  "Taxes") . If any of
the Taxes specified in this Section 4.3(a) are paid by the Lender,  the Borrower
shall,  upon  demand of the  Lender,  promptly  reimburse  the  Lender  for such
payments,  together  with any  interest,  penalties  and  expenses  incurred  in
connection  therewith.  The Borrower shall deliver to the Lender certificates or
other valid  vouchers for all Taxes or other charges  deducted from or paid with
respect to payments made by the Borrower hereunder.
<PAGE>

         (b)  Additional  Costs  .  Subject  to  Section  4.3(c),   and  without
duplication of any amounts payable  described in Section 4.2 or 4.3(a), if after
the date  hereof any change in any law or  regulation  or in the  interpretation
thereof by any court or  administrative  or Governmental  Authority charged with
the  administration  thereof or the  enactment  of any law or  regulation  shall
either (1) impose,  modify or deem  applicable any reserve,  special  deposit or
similar  requirement  against the Lender's  Commitment or Loans or (2) impose on
the Lender any other condition  regarding this Agreement,  its Commitment or the
Loans and the result of any event  referred  to in clause (1) or (2) shall be to
increase the cost to the Lender of maintaining  its Commitment or any Loans made
by the Lender (which increase in cost shall be calculated in accordance with the
Lender's  reasonable  averaging and attribution  methods) by an amount which the
Lender deems to be material, then, upon demand by the Lender, the Borrower shall
pay to the Lender an amount equal to such increase in cost.

         (c) Certificate,  Etc. If requested by the Borrower, in connection with
any demand for payment pursuant to this Section 4.3, the Lender shall provide to
the Borrower a certificate setting forth in reasonable detail the basis for such
demand,  the amount  required  to be paid by the  Borrower  to the  Lender,  the
computations made by the Lender to determine such amount and satisfaction of the
conditions  set forth in the next  sentence.  Anything  to the  contrary  herein
notwithstanding,  the Lender  shall not have the right to demand any  payment or
compensation under this Section 4.3 (i) with respect to any period more than 180
days prior to the date it has made a demand  pursuant to this  Section  4.3, and
(ii) to the extent that the Lender  determines  in good faith that the  interest
rate on the relevant  Loans  appropriately  accounts for any  increased  cost or
reduced  rate of return.  In the  absence of  manifest  error,  the  certificate
referred to above shall be conclusive as to the amount required to be paid.

Section  4.4  Expenses;  Indemnity  . (a)  The  Borrower  agrees:  (i) to pay or
reimburse  the  Lender  for all  reasonable  out-of-pocket  costs  and  expenses
incurred in connection with the preparation and execution of, and any amendment,
supplement or modification  to, this Agreement and any other documents  prepared
in connection  herewith or therewith,  and the  consummation of the transactions
contemplated hereby and thereby,  including,  without limitation, the reasonable
fees and  disbursements of Brown & Wood LLP, counsel to the Lender;  and (ii) to
pay or reimburse the Lender for all  reasonable  costs and expenses  incurred in
connection  with the  enforcement  or  preservation  of any  rights  under  this
Agreement  and any such other  documents,  including,  without  limitation,  the
reasonable fees and  disbursements  of counsel to the Lender.  The Borrower also
agrees to indemnify the Lender against any transfer  taxes,  documentary  taxes,
assessments  or  charges  made by any  Governmental  Authority  by reason of the
execution and delivery of this Agreement.

         (b) The  Borrower  agrees to  indemnify  the Lender and its  directors,
officers,  partners,  employees,  agents and  Affiliates  (for  purposes of this
paragraph,  each, an "Indemnitee") against, and to hold each Indemnitee harmless
from,  any and all claims,  liabilities,  damages,  losses,  costs,  charges and
expenses  (including  fees and  expenses  of  counsel)  incurred  by or asserted
against any Indemnitee arising out of, in any way connected with, or as a result
of (i)  the  execution  or  delivery  of  this  Agreement  or any  agreement  or
instrument  contemplated  by this  Agreement,  the  performance  by the  parties
thereto of their respective obligations under this Agreement or the consummation
of the transactions and the other  transactions  contemplated by this Agreement,
(ii)  the use of the  proceeds  of the  Loans or (iii)  any  claim,  litigation,
investigation or proceeding relating to any of the foregoing, whether or not any
Indemnitee is a party thereto; provided that such indemnity shall not, as to any
Indemnitee,  be  available  to the extent  that such  losses,  claims,  damages,
liabilities  or  related  expenses  are  determined  by  a  court  of  competent
jurisdiction by final and nonappealable judgment to have resulted from the gross
negligence or willful misconduct of such Indemnitee.

         (c) All  amounts  due  under  this  Section  4.4  shall be  payable  in
immediately available funds upon written demand therefor.

Section 4.5 Survival . The  provisions of Sections 4.2, 4.3 and 4.4 shall remain
operative and in full force and effect  regardless of the expiration of the term
of this Agreement, the consummation of the transactions contemplated hereby, the
repayment of any of the Loans,  the reduction or termination of the  Commitment,
the invalidity or  unenforceability  of any term or provision of this Agreement,
or any investigation made by or on behalf of the Lender.

ARTICLE V.
                         REPRESENTATIONS AND WARRANTIES

Section  5.1  Representations  and  Warranties  . The  Borrower  represents  and
warrants to the Lender as follows:

         (a) Good  Standing and Power . The Borrower  and each  Subsidiary  is a
limited partnership or corporation,  duly organized and validly existing in good
standing under the laws of the  jurisdiction of its  organization;  each has the
power to own its property  and to carry on its business as now being  conducted;
and  each is duly  qualified  to do  business  and is in good  standing  in each
jurisdiction  in which the  character  of the  properties  owned or leased by it
therein or in which the  transaction  of its business  makes such  qualification
necessary,  except  where  the  failure  to be so  qualified,  or to be in  good
standing,  individually or in the aggregate, could not reasonably be expected to
have a Material Adverse Effect.

         (b)  Authority . The Borrower  has full power and  authority to execute
and deliver,  and to incur and perform its  obligations  under,  this Agreement,
which has been duly authorized by all proper and necessary action. No consent or
approval of limited  partners is  required  as a  condition  to the  validity or
performance  of, or the  exercise by the Lender of any of its rights or remedies
under, this Agreement.

         (c)   Authorizations  .  All   authorizations,   consents,   approvals,
registrations,  notices,  exemptions and licenses with or from any  Governmental
Authority or other Person necessary for the execution,  delivery and performance
by  the  Borrower  of,  and  the  incurrence  and  performance  of  each  of its
obligations  under,  this  Agreement,  and the  exercise  by the  Lender  of its
remedies  under this  Agreement  have been  effected or obtained and are in full
force and effect.

         (d)  Binding  Obligation  . This  Agreement  constitutes  the valid and
legally  binding  obligation of the Borrower  enforceable in accordance with its
terms,  subject as to  enforcement to  bankruptcy,  insolvency,  reorganization,
moratorium  and similar laws of general  applicability  relating to or affecting
creditors' rights and to general equity principles.

         (e) Litigation . There are no proceedings or investigations now pending
or, to the knowledge of the Borrower,  threatened before any court or arbitrator
or  before  or by  any  Governmental  Authority  which,  individually  or in the
aggregate,  if  determined  adversely  to the  interests  of the Borrower or any
Subsidiary, could reasonably be expected to have a Material Adverse Effect.

         (f) No  Conflicts . There is no  statute,  regulation,  rule,  order or
judgment,  and no provision  of any  agreement  or  instrument  binding upon the
Borrower or any Subsidiary,  or affecting their properties,  and no provision of
the certificate of limited partnership, certificate of incorporation,  agreement
of limited partnership or by-laws (or similar  constitutive  instruments) of the
Borrower or any  Subsidiary,  that would  prohibit,  conflict with or in any way
impair the  execution or delivery of, or the  incurrence or  performance  of any
obligations of the Borrower under,  this Agreement,  or result in or require the
creation or imposition of any Lien on property of the Borrower or any Subsidiary
as a consequence of the execution, delivery and performance of this Agreement.

         (g) Taxes . The Borrower and the Subsidiaries  each has filed or caused
to be filed all tax  returns  that are  required  to be filed and paid all taxes
that are  required to be shown to be due and  payable on said  returns or on any
assessment  made  against  it or  any of  its  property  and  all  other  taxes,
assessments, fees, liabilities,  penalties or other charges imposed on it or any
of  its  property  by  any  Governmental   Authority,   except  for  any  taxes,
assessments,  fees,  liabilities,  penalties  or other  charges  which are being
contested  in good faith and (unless the amount  thereof is not  material to the
Borrower's  consolidated  financial  condition) for which adequate reserves have
been established in accordance with GAAP.

         (h)  Properties . The Borrower and the  Subsidiaries  each has good and
marketable  title to, or valid  leasehold  interests  in, all of its  respective
properties and assets.  All such assets and properties are so owned or held free
and clear of all Liens, except Permitted Liens.

         (i) Compliance  with Laws and Charter  Documents . Neither the Borrower
nor any Subsidiary is, or as a result of performing any of its obligations under
this Agreement will be, in violation of (a) any law, statute,  rule,  regulation
or order of any  Governmental  Authority  applicable to it or its  properties or
assets  or  (b)  its   certificate  of  limited   partnership,   certificate  of
incorporation,   agreement  of  limited  partnership,  by-laws  or  any  similar
document.

         (j) No  Material  Adverse  Effect . Since May 15,  1997,  there has not
occurred or arisen any event, condition or circumstance that, individually or in
the aggregate, could reasonably be expected to have a Material Adverse Effect.

         (k)  Disclosure  . All  information  relating  to the  Borrower  or its
Subsidiaries  delivered  in  writing  to  the  Lender  in  connection  with  the
negotiation,  execution  and delivery of this  Agreement is true and complete in
all material respects.  There is no material fact of which the Borrower is aware
which, individually or in the aggregate,  would reasonably be expected adversely
to  influence  the  Lender's  credit  analysis  relating to the Borrower and its
Subsidiaries which has not been disclosed to the Lender in writing.

Section 5.2 Survival . All  representations  and warranties made by the Borrower
in this  Agreement,  and in the  certificates or other  instruments  prepared or
delivered in connection with or pursuant to this Agreement,  shall be considered
to have  been  relied  upon by the  Lender,  (ii)  survive  the  making of Loans
regardless of any  investigation  made by, or on behalf of, the Lender and (iii)
continue  in full  force  and  effect  as long as the  Commitment  has not  been
terminated  and,  thereafter,  so long as any Loan,  fee or other amount payable
under this Agreement remains unpaid.

ARTICLE VI.
                              CONDITIONS PRECEDENT

Section 6.1 Conditions to the  Availability  of the Commitment . The obligations
of the Lender  hereunder are subject to, and the Lender's  Commitment  shall not
become available until the earliest date (the "Effective Date") on which each of
the  following  conditions  precedent  shall  have been  satisfied  or waived in
writing by the Lender:

         (a) This Agreement . The Lender shall have received this Agreement duly
executed and delivered by the Borrower.

         (b)  Certificate of  Incorporation  and By-Laws . The Lender shall have
received the following:

(i)      a copy of the  Certificate  of  Incorporation  of the  Borrower,  as in
         effect on the  Effective  Date,  certified by the Secretary of State of
         Delaware, and a certificate from such Secretary of State as to the good
         standing of the Borrower, in each case as of a date reasonably close to
         the Effective Date; and

(ii)     a  certificate  of a  Responsible  Officer of the  Borrower,  dated the
         Effective  Date,  and  stating  that  attached  thereto  is a true  and
         complete copy of the By-Laws of the Borrower as in effect on such date.

(c)      Representations  and  Warranties . The  representations  and warranties
         contained  in Section  5.1 shall be true and  correct on the  Effective
         Date,  and the Lender shall have  received a  certificate,  signed by a
         Responsible Officer of the Borrower, to that effect.

(d)      Other   Documents  .  The  Lender  shall  have   received   such  other
         certificates, opinions and other documents as the Lender reasonably may
         require.

(e)      REIT Status of Reckson . The borrowing  shall not, in the sole judgment
         of the Lender, endanger Reckson's status as a REIT.

(f)      Certain Loans Subject to Reckson's Approval.  In respect of any Loan or
         Loans aggregating $25 million in a single RSVP Platform,  Reckson shall
         have approved the Lender's making such Loan in its sole discretion.

Section 6.2 Conditions to All Loans . The obligations of the Lender to make each
Loan are subject to the conditions  precedent that, on the date of each Loan and
after giving effect thereto,  each of the following  conditions  precedent shall
have been satisfied, or waived in writing by the Lender:

         (a)  Borrowing  Request . The Lender  shall have  received a  Borrowing
Request in accordance with the terms of this Agreement.

         (b) No Default . No Default or Event of Default shall have occurred and
be  continuing,  nor shall any Default or Event of Default  occur as a result of
the making of such Loan.

         (c)  Debt-to-Equity  Ratio.  The Lender  shall have  received  from the
Borrower a certificate  demonstrating that the ratio of the Borrower's  Adjusted
Indebtedness  to the  Borrower's  Net Assets,  taking into account the requested
Loan and the assets, if any, to be acquired by the Borrower with the proceeds of
such Loan, shall not exceed 4-to-1.

         (d) Representations and Warranties; Covenants . The representations and
warranties  contained  in Section 5.1 shall have been true and correct when made
and (except to the extent  that any  representation  or warranty  speaks as of a
date  certain)  shall be true and  correct on the  Borrowing  Date with the same
effect as though such representations and warranties were made on such Borrowing
Date;  and the  Borrower  shall  have  complied  with all of its  covenants  and
agreements under this Agreement.



<PAGE>

Section 6.3
         Satisfaction of Conditions  Precedent . Each of (i) the delivery by the
Borrower of a Borrowing  Request  (unless the  Borrower  notifies  the Lender in
writing to the contrary prior to the Borrowing  Date) and (ii) the acceptance of
the  proceeds of a Loan shall be deemed to  constitute  a  certification  by the
Borrower  that,  as of the  Borrowing  Date,  each of the  conditions  precedent
contained in Section 6.2 has been  satisfied with respect to the Loan then being
made.

ARTICLE VII.
                                    COVENANTS
Section  7.1  Affirmative  Covenants  .  Until  satisfaction  in full of all the
obligations  of  the  Borrower  under  this  Agreement  and  termination  of the
Commitment of the Lender hereunder, the Borrower will:

         (a)  Financial  Statements;  Compliance  Certificates  . Furnish to the
Lender:

(i)      as soon as available,  but in no event more than 60 days  following the
         end of each of the first three quarters of each fiscal year,  copies of
         the Borrower's  Quarterly Report on Form 10-Q being filed with the SEC,
         which  shall  include a  consolidated  balance  sheet and  consolidated
         income statement of the Borrower and the Subsidiaries for such quarter;

(ii)     as soon as available,  but in no event more than 120 days following the
         end of each fiscal year, a copy of the Borrower's Annual Report on Form
         10-K being  filed with the SEC,  which shall  include the  consolidated
         financial  statements  of the Borrower and the  Subsidiaries,  together
         with a  report  thereon  by  Ernst &  Young  LLP  (or  another  firm of
         independent certified public accountants reasonably satisfactory to the
         Lender), for such year;

(iii)    within five  Business Days of any  Responsible  Officer of the Borrower
         obtaining knowledge of any Default or Event of Default, if such Default
         or Event of Default is then continuing,  a certificate of a Responsible
         Officer of the Borrower  stating that such  certificate is a "Notice of
         Default" and setting forth the details thereof and the action which the
         Borrower is taking or proposes to take with respect thereto; and

(iv)     such  additional  information,  reports or  statements,  regarding  the
         business,  financial condition or results of operations of the Borrower
         and its  Subsidiaries,  as the Lender from time to time may  reasonably
         request.

         (b)  Existence . Except as  permitted by Section  7.2(a),  maintain its
existence in good  standing  and qualify and remain  qualified to do business in
each jurisdiction in which the character of the properties owned or leased by it
therein or in which the  transaction of its business is such that the failure to
qualify,  individually or in the aggregate, could reasonably be expected to have
a Material Adverse Effect.

         (c)  Compliance  with Law and  Agreements  .  Comply,  and  cause  each
Subsidiary to comply,  with all  applicable  laws,  ordinances,  orders,  rules,
regulations  and  requirements  of all  Governmental  Authorities  and  with all
agreements  except where the necessity of  compliance  therewith is contested in
good faith by appropriate  proceedings or where the failure to comply therewith,
individually  or in the  aggregate,  could not  reasonably be expected to have a
Material Adverse Effect.

         (d) Authorizations . Obtain, make and keep in full force and effect all
authorizations from and registrations with Governmental Authorities required for
the validity or enforceability of this Agreement.

         (e)  Inspection  . Permit,  and cause each  Subsidiary  to permit,  the
Lender to have one or more of its  officers and  employees,  or any other Person
designated  by the Lender,  to visit and inspect  any of the  properties  of the
Borrower and the Subsidiaries and to examine the minute books,  books of account
and  other  records  of the  Borrower  and the  Subsidiaries,  and to  photocopy
extracts  from such minute  books,  books of account and other  records,  and to
discuss its  affairs,  finances  and  accounts  with its  officers  and with the
Borrower's  independent  accountants,  during normal  business hours and at such
other reasonable times, for the purpose of monitoring the Borrower's  compliance
with its obligations under this Agreement.

         (f)  Maintenance of Records . Keep, and cause each  Subsidiary to keep,
proper books of record and account in which full,  true and correct entries will
be made of all  dealings or  transactions  of or in relation to its business and
affairs.

         (g) Notice of Defaults and Adverse  Developments . Promptly  notify the
Lender upon the discovery by any  Responsible  officer of the  occurrence of (i)
any Default or Event of Default;  (ii) any event,  development  or  circumstance
whereby the financial  statements most recently  furnished to the Lender fail in
any material  respect to present fairly,  in accordance with GAAP, the financial
condition and operating  results of the Borrower and the  Subsidiaries as of the
date of such financial statements;  (iii) any material litigation or proceedings
that are instituted or threatened (to the knowledge of the Borrower) against the
Borrower or any Subsidiary or any of their  respective  assets;  (iv) any event,
development or  circumstance  which,  individually  or in the  aggregate,  could
reasonably  be expected to result in an event of default (or, with the giving of
notice or lapse of time or both, an event of default) under any Indebtedness and
the amount thereof;  and (v) any other development in the business or affairs of
the  Borrower  or any  Subsidiary  if the effect  thereof  would  reasonably  be
expected,  individually or in the aggregate,  to have a Material Adverse Effect;
in each case describing the nature thereof and the action the Borrower  proposes
to take with respect thereto.

Section  7.2  Negative  Covenants  .  Until  satisfaction  in  full  of all  the
obligations  of  the  Borrower  under  this  Agreement  and  termination  of the
Commitment of the Lender hereunder, the Borrower will not:

(a)

<PAGE>



         Mergers,  Consolidations  and Sales of Assets . Wind up,  liquidate  or
dissolve its affairs or enter into any merger,  consolidation or share exchange,
or  convey,  sell,  lease or  otherwise  dispose  of (or  agree to do any of the
foregoing at any future time),  whether in one or a series of transactions,  all
or any substantial part of its assets, or permit any Subsidiary so to do, unless
such transaction or series of transactions are expressly approved by the Lender,
which approval shall not be unreasonably withheld.

         (b) Liens . Create,  incur,  assume or suffer to exist any Lien upon or
with  respect to any of its  property or assets,  whether now owned or hereafter
acquired,  or assign or  otherwise  convey any right to receive  income,  except
Permitted Liens.

         (c) Indebtedness . Create, incur, issue, assume, guarantee or suffer to
exist any Indebtedness, except:

      (i)   Indebtedness  to the Lender  under this  Agreement  or under the RSI
            Facility Agreement,

      (ii)  Non-recourse Indebtedness of the Borrower and any Subsidiary secured
            by  mortgages,  encumbrances  or  liens  specifically  permitted  by
            Section 7.2(b), and

      (iii) Indebtedness  expressly  approved  by the Lender in  writing,  which
            approval may be withheld in the Lender's sole discretion.

         (d)  Dividends . Declare any  dividends on any of its shares of capital
stock unless such dividend or distribution  is expressly  approved in writing by
the Lender.

         (e)  Certain  Amendments  . Amend,  modify  or  waive,  or permit to be
amended,  modified or waived,  any provision of its Certificate of Incorporation
unless,  within not less than 5 days prior to such  amendment,  modification  or
waiver (or such later time as the Lender may in its sole discretion permit), the
Borrower  shall have given the Lender  notice  thereof,  including  all relevant
terms and  conditions  thereof,  and the Lender shall have  consented in writing
thereto.

ARTICLE VIII.
                                EVENTS OF DEFAULT



Section 8.1 Events of Default . If one or more of the following events (each, an
"Event of Default") shall occur:

         (a) The Borrower  shall fail duly to pay any principal of any Loan when
due, whether at maturity, by notice of intention to prepay or otherwise; or

         (b) The Borrower shall fail duly to pay any interest,  fee or any other
amount payable under this Agreement within two days after the same shall be due;
or

         (c) Borrower shall fail duly to observe or perform any term,  covenant,
or agreement contained in Section 7.2; or

         (d) The Borrower  shall fail duly to observe or perform any other term,
covenant or agreement  contained in this Agreement,  and such failure shall have
continued unremedied for a period of 30 days; or

         (e) Any  representation or warranty made or deemed made by the Borrower
in this Agreement,  or any statement or representation  made in any certificate,
report or opinion  delivered by or on behalf of the Borrower in connection  with
this  Agreement,  shall prove to have been false or  misleading  in any material
respect when so made or deemed made; or

         (f)  The  Borrower  shall  fail  to pay any  Indebtedness  (other  than
obligations  here  under) in an amount of $100,000 or more when due; or any such
Indebtedness  having an aggregate  principal  amount  outstanding of $100,000 or
more  shall  become or be  declared  to be due prior to the  expressed  maturity
thereof; or

         (g) An involuntary case or other proceeding shall be commenced  against
the Borrower seeking liquidation, reorganization or other relief with respect to
it or its debts under any applicable bankruptcy,  insolvency,  reorganization or
similar law or seeking the  appointment  of a custodian,  receiver,  liquidator,
assignee,  trustee,  sequestrator  or similar  official of it or any substantial
part of its property, and such involuntary case or other proceeding shall remain
undismissed  and  unstayed  for a period  of more  than 60 days;  or an order or
decree approving or ordering any of the foregoing shall be entered and continued
unstayed and in effect; or

         (h) The Borrower shall  commence a voluntary  case or proceeding  under
any  applicable  bankruptcy,  insolvency,  reorganization  or similar law or any
other case or  proceeding to be  adjudicated a bankrupt or insolvent,  or any of
them  shall  consent  to the entry of a decree or order for relief in respect of
the  Borrower  in  an  involuntary  case  or  proceeding  under  any  applicable
bankruptcy,   insolvency,   reorganization  or  other  similar  law  or  to  the
commencement of any bankruptcy or insolvency  case or proceeding  against any of
them,  or any of them  shall  file a  petition  or  answer  or  consent  seeking
reorganization  or relief under any applicable law, or any of them shall consent
to the filing of such petition or to the appointment of or taking  possession by
a custodian,  receiver,  liquidator,  assignee, trustee, sequestrator or similar
official  of the  Borrower  or any  substantial  part  of its  property,  or the
Borrower shall make an assignment for the benefit of creditors,  or the Borrower
shall admit in writing its  inability to pay its debts  generally as they become
due, or the Borrower  shall take  corporate  action in  furtherance  of any such
action;

         (i) One or more judgments  against the Borrower or attachments  against
its property, which in the aggregate exceed $100,000, or the operation or result
of which could be to interfere  materially and adversely with the conduct of the
business  of the  Borrower  remain  unpaid,  unstayed  on appeal,  undischarged,
unbonded, or undismissed for a period of more than 30 days; or

         (j) Any  court or  governmental  or  regulatory  authority  shall  have
enacted, issued, promulgated, enforced or entered any statute, rule, regulation,
judgment,  decree, injunction or other order (whether temporary,  preliminary or
permanent)  which  is in  effect  and  which  prohibits,  enjoins  or  otherwise
restricts, in a manner that, individually or in the aggregate,  could reasonably
be  expected  to  have a  Material  Adverse  Effect,  any  of  the  transactions
contemplated under this Agreement; or

         (k) Any Event of Default  shall occur and be  continuing  under the RSI
Facility Agreement.

then,  and at any time  during the  continuance  of such Event of  Default,  the
Lender  may,  by  written  notice to the  Borrower,  take  either or both of the
following actions,  at the same or different times: (i) terminate  forthwith the
Commitment and (ii) declare any Loans then outstanding to be due,  whereupon the
principal of the Loans so declared to be due,  together  with  accrued  interest
thereon  and any unpaid  amounts  accrued  under this  Agreement,  shall  become
forthwith due, without presentment,  demand,  protest or any other notice of any
kind (all of which are hereby expressly waived by the Borrower);  provided that,
in the case of any Event of Default described in Section 8.1(g) or (h) occurring
with respect to the Borrower, the Commitment shall automatically and immediately
terminate and the principal of all Loans then outstanding, together with accrued
interest  thereon and any unpaid  amounts  accrued under this  Agreement,  shall
automatically and immediately become due without presentment, demand, protest or
any other  notice of any kind (all of which are hereby  expressly  waived by the
Borrower).

ARTICLE IX.

                          EVIDENCE OF LOANS; TRANSFERS

Section  9.1  Evidence  of  Loans  . (a)  The  Lender  shall  maintain  accounts
evidencing the  indebtedness  of the Borrower to the Lender  resulting from each
Loan made by the Lender from time to time,  including  the amounts of  principal
and interest payable and paid to the Lender in respect of Loans.

         (b) The Lender's written records described above shall be available for
inspection during ordinary business hours by the Borrower from time to time upon
reasonable prior notice to the Lender.

         (c) The entries made in the Lender's written or electronic  records and
the  foregoing  accounts  shall be prima  facie  evidence of the  existence  and
amounts of the indebtedness of the Borrower therein recorded; provided, however,
that the failure of the Lender to maintain any such account or such records,  as
applicable, or any error therein, shall not in any manner affect the validity or
enforceability of any obligation of the Borrower to repay any Loan actually made
by the Lender in accordance with the terms of this Agreement.

ARTICLE X.

                                  MISCELLANEOUS

Section 10.1  Applicable Law . THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED
IN  ACCORDANCE  WITH THE LAWS OF THE STATE OF NEW YORK  APPLICABLE  TO CONTRACTS
MADE AND TO BE PERFORMED ENTIRELY WITHIN SUCH STATE.

Section  10.2 Waiver of Jury . THE  BORROWER  AND THE LENDER EACH HEREBY  WAIVES
TRIAL BY JURY IN ANY JUDICIAL PROCEEDING INVOLVING,  DIRECTLY OR INDIRECTLY, ANY
MATTER (WHETHER SOUNDING IN TORT,  CONTRACT OR OTHERWISE) IN ANY WAY ARISING OUT
OF,  RELATED  TO,  OR  CONNECTED  WITH  THIS  AGREEMENT,  OR  THE  RELATIONSHIPS
ESTABLISHED HEREUNDER.

Section 10.3  Jurisdiction and Venue;  Service of Process . (a) The Borrower and
the Lender each hereby irrevocably submits to the non-exclusive  jurisdiction of
any state or federal court in the Borough of Manhattan, The City of New York for
the purpose of any suit,  action,  proceeding or judgment relating to or arising
out of this Agreement and to the laying of venue in the Borough of Manhattan The
City of New York. The Borrower and the Lender each hereby irrevocably waives, to
the fullest extent  permitted by applicable  law, any objection to the laying of
the venue of any such suit, action or proceeding brought in the aforesaid courts
and hereby irrevocably waives any claim that any such suit, action or proceeding
brought in any such court has been brought in an inconvenient forum.

         (b)  Borrower  agrees  that  service of  process in any such  action or
proceeding  may be effected by mailing a copy thereof by registered or certified
mail (or any  substantially  similar  form of  mail),  postage  prepaid,  to the
Borrower at its address set forth in subsection 10.7 or at such other address of
which the Lender shall have been notified pursuant thereto. The Borrower further
agrees that nothing  herein shall affect the right to effect  service of process
in any  other  manner  permitted  by law or shall  limit the right to sue in any
other jurisdiction; and

         (c) The Borrower  waives,  to the maximum extent not prohibited by law,
any  right it may have to claim or  recover  in any legal  action or  proceeding
referred to in this subsection any special, exemplary, punitive or consequential
damages.

Section 10.4

         Confidentiality  . The  Lender  agrees (on behalf of itself and each of
its Affiliates,  partners,  officers,  employees and representatives) to use its
best efforts to keep confidential, in accordance with their customary procedures
for handling  confidential  information  of this nature and in  accordance  with
commercially  reasonable  business  practices,  any  Confidential   Information;
provided that nothing herein shall limit the disclosure of any such  information
(i) to the extent  required by statute,  rule,  regulation or judicial  process,
(ii) to counsel for the Lender,  (iii) to auditors or  accountants,  (iv) by the
Lender  to an  Affiliate  thereof,  or (v) in  connection  with  any  litigation
relating to  enforcement  of this  Agreement;  provided  further,  that,  unless
specifically  prohibited  by  applicable  law or court order,  the Lender shall,
prior to disclosure  thereof,  notify the Borrower of any request for disclosure
of  any  Confidential   Information  (x)  by  any   Governmental   Authority  or
representative thereof or (y) pursuant to legal process.

Section 10.5 Amendments and Waivers . (a) Any provision of this Agreement may be
amended,  modified,  supplemented or waived,  but only by a written amendment or
supplement, or written waiver, signed by the Borrower and the Lender.

         (b) Except to the extent expressly set forth therein,  any waiver shall
be  effective  only in the specific  instance  and for the specific  purpose for
which such waiver is given.

Section 10.6 Cumulative  Rights; No Waiver . Each and every right granted to the
Lender hereunder or under any other document  delivered in connection  herewith,
or allowed it by law or equity, shall be cumulative and not exclusive and may be
exercised  from time to time.  No failure on the part of the Lender to exercise,
and no delay in exercising, any right will operate as a waiver thereof, nor will
any single or partial  exercise by the Lender of any right preclude any other or
future exercise thereof or the exercise of any other right.

Section 10.7 Notices . Any communication, demand or notice to be given hereunder
will be duly given when  delivered  in writing or by  telecopy to a party at its
address as indicated  below or such other address as such party may specify in a
notice  to the other  party  hereto.  A  communication,  demand or notice  given
pursuant to this Agreement shall be addressed:

                  If to the Borrower, to:

                           Reckson Service Industries, Inc.
                           225 Broadhollow Road
                           Melville, New York  11747
                           Telecopy:          (516) 719-7400
                           Attention:          Chief Financial Officer



<PAGE>



                  If to the Lender, to:

                           Reckson Operating Partnership, L.P.
                           225 Broadhollow Road
                           Melville, New York  11747
                           Telecopy:          (516) 694-6900
                           Attention:          Chief Financial Officer

         This Section 10. 7 shall not apply to notices referred to in Article II
of this Agreement, except to the extent set forth therein.

Section  10.8  Certain  Acknowledgments  .  The  Borrower  hereby  confirms  and
acknowledges  that  (a) the  Lender  does  not have  any  fiduciary  or  similar
relationship  to the Borrower by virtue of this  Agreement and the  transactions
contemplated  herein and that the  relationship  established  by this  Agreement
between the Lender and the  Borrower  is solely that of creditor  and debtor and
(b) no joint  venture  exists  between the  Borrower and the Lender by virtue of
this Agreement and the transactions contemplated herein.

Section 10.9 Separability . In case any one or more of the provisions  contained
in this  Agreement  shall be invalid,  illegal or  unenforceable  in any respect
under any law,  the  validity,  legality  and  enforceability  of the  remaining
provisions  contained  herein  shall  not in any  way be  affected  or  impaired
thereby.

Section  10.10  Parties in Interest . This  Agreement  shall be binding upon and
inure to the  benefit  of the  Borrower  and the  Lender  and  their  respective
successors  and  assigns,  except  that the  Borrower  may not assign any of its
rights  hereunder  without  the prior  written  consent of the  Lender,  and any
purported assignment by the Borrower without such consent shall be void.

Section 10.11  Execution in Counterparts . This Agreement may be executed in any
number  of  counterparts  and  by  the  different  parties  hereto  on  separate
counterparts, each of which when so executed and delivered shall be an original,
but all the counterparts shall together constitute one and the same instrument.



                  IN WITNESS  WHEREOF,  the  parties  hereto  have  caused  this
Agreement to be duly executed as of the date first above written.

                                    RECKSON SERVICE INDUSTRIES, INC.,
                                    as Borrower


                                     By:      /s/ Scott H. Rechler\
                                              -----------------------
                                              Name:  Scott H. Rechler
                                              Title:  President

                                    RECKSON OPERATING PARTNERSHIP, L.P.,
                                    as Lender

                                      By:     RECKSON ASSOCIATES REALTY CORP.,
                                               its general partner

                                      By:      /s/ Mitchell Rechler
                                              -------------------------
                                               Name:  Mitchell Rechler
                                               Title:  Executive Vice President